Investor Presentation • May 13, 2022
Investor Presentation
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May 13th, 2022
| 1 | Strong intake of new GBV and steady Collection Rate |
• Approx. €4.9bn of new mandates already secured in 2022 YTD (€1.2bn in Italy and €3.7bn in the Hellenic Region) Forward flows in Q1 2022 totalling €0.8bn (roughly equally split between Spain, Greece and Italy) • • With a total of €5.6bn of new GBV secured in 2022 YTD, already achieved c. 42% of 2022 target (€13-14bn) • Overall pipeline today of €24bn of potential mandates to be assigned in the market in 2022 • GBV increasing to €153bn (+2.1% from Dec-21), pro-forma for mandates secured but not yet onboarded GBV is €158bn • Collections of €1.3bn in line with Q1 2021 (+0.1% YoY) Collection Rate of 4.2% as of Mar-22 (broadly in line with FY 2021 level) • |
✓ |
|---|---|---|---|
| 2 | Strong financial performance in Q1 2022 |
Gross Revenues of €131m (+3.6% Year-on-Year) • • EBITDA ex NRI of €39m (+1.6% Year-on-Year) • EBITDA ex NRI margin of 30.0% Net Income ex NRI of €10m (+34.5% Year-on-Year) • • Stable Net Debt / EBITDA at 2.0x (vs 2.0x as of Dec-21) |
✓ |
| 3 | Sareb does not affect 2024 targets for Iberia |
Sareb decision not to reappoint current servicers (including doValue) communicated on February 24th, 2022 • • Full D&A impact already accounted on FY 2021 results (€4.6m impact post-tax and post-minorities) No material impact in terms of D&A expected for 2022 • • Extraordinary reorganisation cost (NRIs) estimated at max €15m to impact P&L in H2 2022 EBITDA ex NRIs target for 2024 for Iberia (€35-40m) remains intact • • Impact on 2022-2023 in line with previous guidance |
✓ |
| 4 | Macro backdrop will support doValue pipeline |
• Full normalisation of auction and collection activity already in 2021 Moratoria and restrictions on foreclosures lifted in 2021 • • Macro slowdown triggered by conflict in Ukraine will exacerbate formation of NPEs • doValue collection performance remains resilient |
✓ |
Forward Flows New Mandates
| Key Metrics (€m) | Comments | ||
|---|---|---|---|
| +3.6% +7.0%1 |
+1.6% +13.3%1 |
+34.5% | • Comparable consolidation perimeter in Q1 2022 vs Q1 2021 Typically Q1 is a seasonally weak quarter compared to rest of the year • • Q1 2021 was positively affected by €4bn capital gain on Relais notes resale |
| 131 127 |
30.6% 30.0% EBITDA EBITDA margin2 margin |
• Q1 2022 does not feature material exceptional items Positive performance of Italy and very strong performance in Hellenic Region • • EBITDA margin of 30% despite expected relative lower performance of Iberia |
|
| 39 39 |
10 8 |
||
| Gross Revenues | EBITDA ex NRIs Q1 2021 Q1 2022 |
Attributable Net Income ex NRIs |
•Notes:
•1) Excluding from Q1 2021 the €4m capital gain realised from the sale of Relais notes
•2) EBITDA ex NRIs margin for Q1 2021 and excluding €4m capital gain realised from the sale of Relais notes stands at 28.3%
7 Q1 2022 results
| Item | Q1 2021 | Q1 2022 | Delta | Comments |
|---|---|---|---|---|
| GBV | €161bn | €153bn | broadly stable |
• Approx. €5.5bn already won but yet to be onboarded will bring to €158bn pro-forma GBV |
| Collections | €1.3bn | €1.3bn | +0.1% | GBV dynamic driven by acceleration of collections post COVID • and by one-off disposals by banks clients, partially offset by inflows |
| Collection Rate | 3.3% | 4.2% | +0.9 p.p. | Increase in Collection Rate driven by post COVID normalisation • and early signs of productivity gains (doTransformation) |
| Gross Revenues | €126.6m | €131.3m | +3.6% | Strong increase in Gross Revenues and Net Revenues mainly • driven by more favourable GBV mix and higher revenues from |
| Net Revenues | €111.6m | €116.1m | +4.0% | ancillary activities Excluding €4m Relais capital gain in Q1 2021, Gross Revenues • increase is +7.0% and EBITDA ex NRIs increase is +13.3% |
| EBITDA ex NRIs | €38.7m | €39.3m | +1.6% | • Strong growth in EBITDA driven by increase in Net Revenues |
| EBITDA ex NRIs margin | 30.6% | 30.0% | -0.6 p.p. | partially offset by increased operating costs • Limited NRIs at c. €0.4m at EBITDA level • Growth in Net Income ex NRIs driven by increase in EBITDA, |
| Attributable Net Income ex NRIs | €7.7m | €10.4m | +34.5% | lower D&A and net positive revaluation of financial assets |
| Net Debt | €376.5m | €400.9m | +6.5% | Increase in Net Debt in LTM driven by several one off items • such as BidX1 acquisition (€10m), share buy-back (€5m), Tax |
| Financial Leverage | 2.3x | 2.0x | -0.3x | Claim payment (€33m) Stable leverage in Q1 2022 (vs Dec-21) • |
• Inflows from existing clients: €0.8bn (roughly equally split between Spain, Greece and Italy)
13 Q1 2022 results
14 Q1 2022 results
| % of Gross Revenues |
73 | % of tot | % of tot | 77 | % of Gross Revenues |
|---|---|---|---|---|---|
| 9% 1% 6% |
11 2 7 |
16% 2% 10% |
17% 2% 11% |
13 2 9 |
10% 1% 7% |
| 42% | 53 | 72% | 70% | 53 | 41% |
| Q1 2021 | Q1 2022 | ||||
| HR IT |
RE SG&A |
•Notes:
•1) Excluding from Q1 2021 the €4m capital gain realised from the sale of Relais notes, the ratio of Operating Expenses ex NRIs to Gross Revenues stands at 59%
EBITDA
| doValue Group |
Italy | Hellenic Region |
Iberia | |
|---|---|---|---|---|
| Collections | €1.3bn | €0.4bn (30% of tot) |
€0.4bn (28% of tot) |
€0.5bn (42% of tot) |
| Collection Rate | 4.2% | 2.4% | 5.4% | 6.6% |
| Gross Revenues | €131m | €43m (33% of tot) |
€53m (40% of tot) |
€36m (27% of tot) |
| EBITDA ex NRIs | €39m | €10m (26% of tot) |
€28m (70% of tot) |
€1m (4% of tot) |
| EBITDA margin ex NRIs |
30% | 24% | 53% | 4% |
•Notes:
•1) Collections exclude curing
•2) Collection Rate calculated on the basis of GBV in stock for the LTM Mar-22
18 Q1 2022 results
Cash Flow
| Net Debt (€m) | Comments | |||
|---|---|---|---|---|
| 2.0x Net Debt / EBITDA 402 300 261 8 (167) |
2.0x Net Debt / EBITDA 401 297 258 7 (162) |
Significant liquidity position with no maturities before 2025 • - Approx. €162m cash position as of Mar-22 • All bond debt structure achieved in Q3 2021 - €265m issued in Aug-20 (5.0% coupon, 2025 maturity) - €300m bond issued in Jul-21 (3.375% coupon, 2026 maturity) - Full reimbursement of bank debt in Jul-21 - Previously bank debt had an amortising repayment profile - Improved liquidity profile (bullet) and longer maturity - Fitch and Standard & Poor's BB rating confirmed at Stable Outlook and achieved targets for rating category Financial Leverage at 2.0x as of Mar-22 (vs 2.0x as of Dec-21) • - Achieved lower end of leverage target range of 2.0-3.0x • Dividend of €40m paid in May-22 |
||
| Dec-21 Cash Bank Debt |
Mar-22 Bond 2025 Bond 2026 |
• Approx. €120m of total gross credit lines - Pool of Italian, Spanish and Greek banks |
•Data related to Q1 2021 have been restated following the completion of the Purchase Price Allocation of doValue Greece
23 Q1 2022 results
| Condensed Balance Sheet | 3/31/2022 | 12/31/2021 | Change € | Change % |
|---|---|---|---|---|
| Cash and liquid securities | 161,693 | 166,668 | (4,975) | (3)% |
| Financial assets | 62,336 | 61,961 | 375 | 1% |
| Property, plant and equipment | 31,138 | 34,204 | (3,066) | (9)% |
| Intangible assets | 543,949 | 545,225 | (1,276) | (0)% |
| Tax assets | 153,748 | 152,996 | 752 | 0% |
| Trade receivables | 204,946 | 206,326 | (1,380) | (1)% |
| Assets held for sale | 10 | 30 | (20) | (67)% |
| Other assets | 15,272 | 17,226 | (1,954) | (11)% |
| Total Assets | 1,173,092 | 1,184,636 | (11,544) | (1)% |
| Financial liabilities: due to banks/bondholders | 562,586 | 568,459 | (5,873) | (1)% |
| Other financial liabilities | 74,245 | 76,017 | (1,772) | (2)% |
| Trade payables | 63,083 | 73,710 | (10,627) | (14)% |
| Tax liabilities | 113,035 | 113,060 | (25) | (0)% |
| Employee termination benefits | 9,663 | 10,264 | (601) | (6)% |
| Provisions for risks and charges | 38,668 | 44,235 | (5,567) | (13)% |
| Other liabilities | 106,032 | 104,888 | 1,144 | 1% |
| Total Liabilities | 967,312 | 990,633 | (23,321) | (2)% |
| Share capital | 41,280 | 41,280 | - | n.s. |
| Reserves | 121,521 | 96,299 | 25,222 | 26% |
| Treasury shares | (4,678) | (4,678) | - | n.s. |
| Profit (loss) for the period attributable to the Shareholders of the Parent | ||||
| Company | 8,869 | 23,744 | (14,875) | (63)% |
| Net Equity attributable to the Shareholders of the Parent Company | 166,992 | 156,645 | 10,347 | 7% |
| Total Liabilities and Net Equity attributable to the Shareholders of the | ||||
| Parent Company | 1,134,304 | 1,147,278 | (12,974) | (1)% |
| Net Equity attributable to Non-Controlling Interests | 38,788 | 37,358 | 1,430 | 4% |
| Total Liabilities and Net Equity | 1,173,092 | 1,184,636 | (11,544) | (1)% |
•Data related to Q1 2021 have been restated following the completion of the Purchase Price Allocation of doValue Greece
| Condensed Cash flow | 3/31/2022 | 3/31/2021 RESTATED |
|---|---|---|
| EBITDA | 38,919 | 38,247 |
| Capex | (5,064) | (2,748) |
| EBITDA-Capex | 33,855 | 35,499 |
| as % of EBITDA | 87% | 93% |
| Adjustment for accrual on share-based incentive system payments | 1,056 | 974 |
| Changes in NWC (Net Working Capital) | (9,247) | (4,231) |
| Changes in other assets/liabilities | (15,384) | (13,455) |
| Operating Cash Flow | 10,280 | 18,787 |
| Tax paid (IRES/IRAP) | (3,809) | - |
| Financial charges | (6,636) | (6,439) |
| Free Cash Flow | (165) | 12,348 |
| (Investments)/divestments in financial assets | 1,063 | 21,745 |
| Net Cash Flow of the period | 898 | 34,093 |
| Net financial Position - Beginning of period |
(401,791) | (410,556) |
| Net financial Position - End of period |
(400,893) | (376,463) |
| Change in Net Financial Position | 898 | 34,093 |
•Data related to Q1 2021 have been restated following the completion of the Purchase Price Allocation of doValue Greece
| BPO | Business Process Outsourcing, i.e. the outsourcing of non-strategic support activities by banks |
|---|---|
| Early Arrears | Loans that are up to 90 days past due |
| Forward Flows | Agreement with commercial bank related to the management of all future NPL generation by the bank for number of years, customary feature of credit servicing platforms spun off by commercial banks |
| FTE | Full Time Equivalent, i.e. a unit that indicates the workload of an employed person in a way that makes workloads comparable across various contexts |
| GACS | Garanzia Cartolarizzazione Sofferenze, i.e. the State Guarantee scheme put together by the Italian Government in 2016 which favoured the creation of a more liquid NPL market in Italy and allowed banks to more easily deconsolidate NPL portfolios through securitisations |
| GBV | Gross Book Value, i.e. nominal value of assets under management by doValue, represents the maximum / nominal claim by banks / investors to borrowers on their portfolios |
| HAPS | Hercules Asset Protection Scheme, i.e. the State Guarantee scheme put together by the Greek Government in 2019 with the aim of favouring the creation of a more liquid NPL market in Greece and to allow banks to more easily deconsolidate NPL portfolios through securitisations |
| NPE | Non-Performing Exposure, i.e. the aggregate od NPL, UTP and Early Arrears |
| NPL | Non-Performing Loan, i.e. loans which are more than 180 days past due and have been denounced |
| NRI | Non-Recurring Items, i.e. costs or revenues which are non-recurring by nature (typically encountered in M&A or refinancing transactions) |
| Performing Loans |
Loans which do not present problematic features in terms of principal / interest repayment by borrowers |
| REO | Real Estate Owned, i.e. real estate assets owned by a bank / investor as part of a repossession act |
| UTP | Unlikely to Pay, i.e. loans that are between 90-180 days past due and denounced or more than 180 past due and not denounced |
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Certification pursuant article 154 BIS, paragraph 2 of Italian Legislative Decree no. 58 of 24 February 1998 (the Consolidated Financial Law)
Pursuant to Article 154 bis, paragraph 2, of the "Consolidated Law on Finance", Mr Davide Soffietti, in his capacity as the Financial Reporting Officer with preparing the financial reports of doValue S.p.A, certifies that the accounting information contained in this document, is consistent with the data in the supporting documents and the Group's books of accounts and other accounting records.
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Name: Alberto Goretti (Head of Investor Relations) Tel: +39 02 83460127 E-mail: [email protected]
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