EQS-News: IuteCredit Finance S.à r.l.
/ Key word(s): Quarter Results/Quarterly / Interim Statement
Iute Group reports unaudited results for 9M/2024 Steady and profitable transition to the modern banking in Southeastern Europe
OPERATIONAL HIGHLIGHTS
FINANCIAL HIGHLIGHTS
Tallinn, Estonia, 7 November 2024. Iute Group, a leading European personal finance group, reported today unaudited results for 9M/2024. "Iute Group's ongoing transition of from a fintech microcredit provider to the Modern Banking Group in the Balkans has been steady and profitable for 9 months 2024. The shift in services and revenue streams from pure lending to an integrated offering of Wallet Services, Insurance Intermediation, and Instant Lending is visible in both customer numbers and revenues. In addition, a further evolution in the use of deep data in the Group's operations is underway, with the scope of data analytics not being limited to loan decisions alone. While the results are promising, challenges remain. The biggest challenge is to increase profitability, because at Iute Group every new product, solution, or business initiative should generate a reasonable return. Success is measured by the amount of money we generate from paying customers. We need more success. It is therefore encouraging, that Iute Group grew again compared to the previous quarter and increased its performing customer pool by 3% to 236 thousand customers. The new customers were acquired mainly by Iute Non-Bank in Moldova, Albania, and Bulgaria. Energbank is expected to complete its first digitalization projects by the end of 2024, which will unlock new smartphone app possibilities for its customers both in wallet and in loan services. Iute Group's balance sheet also grew compared to the previous quarter, increasing by 3% to 408 million EUR. The share of yielding assets grew even faster, with the net loan portfolio up 6% quarter-on-quarter to 281 million EUR. Thus, the portfolio growth is on track for the target of 300 million EUR by end of 2024. There is less idle capital on the balance sheet while the decline in the pricing of newly issued loans has stabilized. The Non-Bank loan portfolio yields an APR of 38% while Energbank loans yield an average APR of almost 11%. Customer transaction activity with their wallets was stable. Growth in Albania was offset by a decline in Moldova caused by the suspension of certain remittance services from Russia, prescribed by authorities towards all banks. Overall, the growth of wallet revenues accelerated alongside that of insurance intermediation revenues. The latter two revenue streams contributed more than 17% of Iute Group's total revenue in 9M 2024, and their share continues to grow. Although, revenue momentum is starting to improve, with marginal gains in operational efficiency and better credit risk management, the pressure on profitability remains high. An example of the increase in operational efficiency is the 22% share of fully automated loans issued by Non-Bank subsidiaries in Q3 2024. Full automation means that there is not a single human intervention or manual operation involved in the entire loan origination cycle, starting from the loan application by the customer through to the signing of the loan agreement and disbursement of the loan to the customer. The Non-Bank's OPEX to revenue ratio remains below 40%. Improved credit risk management is reflected in the rise of Iute Group's Non-Bank CPI30 up 0.3 percentage points quarter-on-quarter to 87.0%. One full point is approximately equivalent to 1.8 million EUR. The overall economic situation in the Balkans is fragmented. However, the decline in inflation and interest rates throughout the region gives rise to justified optimism for falling interest costs for Iute Group, even though competition with banks is likely to lead to a continuous decline in loan yields. In other words, savings in the cost of capital for the Group will be passed on to end customers. The economies and national currencies of our countries show no signs of weakening, while and some are becoming increasingly integrated into European markets. While Albania aims to join the Single Euro Payments Area (SEPA), Bulgaria is expected to adopt the euro in 2025. Moldova has just narrowly passed a referendum on its constitutional goal of joining the EU. Energbank's operational turnaround continues to be a work in progress with marginal gains achieved. We believe that Energbank's cost-to-income ratio is the key metric to measure the success of the turnaround. Anything over 60% is a failure in the short term and anything over 40% is a failure in the long term. On the bottom line, Iute Group's annual net profit target of 10 million EUR is in sights, while the initially set 15 million EUR is beyond reasonable expectations. Other key performance indicators are well on track, including growth in customer pool, balance sheet, and revenue," said Tarmo Sild, CEO of Iute Group.
CEO Tarmo Sild and CFO Kristel Kurvits will comment on the unaudited 9M/2024 results by means of a webcast presentation today, 7 November 2024, 10.00 CET. The webcast/call will be held in English. Please register in time to participate in the webcast/call at: The corresponding presentation will also be available on the Company's website prior to the earnings webcast/call. Kristel Kurvits, Group Chief Financial Officer (CFO) Iute Group is a fintech company established in 2008 in Estonia. The Group specializes in consumer finance, payment services, banking, and insurance products. It serves customers in Albania, Bulgaria, Moldova, and North Macedonia. Iute Group finances its loan portfolios with equity, deposits, and secured bonds on the Regulated Market of the Frankfurt Stock Exchange and the Nasdaq Baltic Main List. www.iute.com 07.11.2024 CET/CEST Dissemination of a Corporate News, transmitted by EQS News - a service of EQS Group AG. |
| Language: | English |
| Company: | IuteCredit Finance S.à r.l. |
| 14, rue Edward Steichen | |
| 2540 Luxembourg | |
| Luxemburg | |
| ISIN: | XS2378483494 |
| WKN: | A3KT6M |
| Listed: | Regulated Market in Frankfurt (General Standard); Regulated Unofficial Market in Berlin, Dusseldorf, Hamburg, Hanover, Munich, Stuttgart, Tradegate Exchange |
| EQS News ID: | 2024237 |
| End of News | EQS News Service |
2024237 07.11.2024 CET/CEST
