Quarterly Report • Oct 30, 2018
Quarterly Report
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· Axactor Germany successfully secured another forward flow of fresh unsecured consumer claims, from a large financial institution. The forward flow is expected to generate an acquisition cost of approximately EUR 20m over the next twelve months. Axactor Sweden signed a total of three new forward flow contracts during the quarter. The most significant of the contracts has a duration of 24 months, and Axactor will acquire an outstanding balance of approximately EUR 40m over two years, across 7,000 cases. Building on the existing relationship in Norway, the agreement to start acquiring fresh claims from Instabank in Sweden was announced in the quarter. The total capex for the two-year forward flow contract is expected to be between EUR 4m and EUR 5m, with claims arriving from April 2019. The last of the three contracts is with a mid-size European bank, and Axactor will acquire micro loans with a total Outstanding Balance (OB) per annum of approximately EUR 7.2 million distributed on an estimate of 8,200 cases
· Axactor Spain added two new outsourcing contracts to provide collection services of secured debt for two relevant players in the real estate market; one of the largest financial institutions and one of the main real estate servicers in Spain. The combined annual contract value is EUR 1.5m across both contracts. Both contracts are for twelve months and renewable for a further twelve months
| EUR million | Q3 2018 | Q3 2017 | YTD 2018 | YTD 2017 |
|---|---|---|---|---|
| Gross revenue | 56.5 | 23.6 | 164.2 | 70.2 |
| Net Revenue | 48.7 | 20.1 | 138.9 | 61.1 |
| EBITDA | 10.0 | 2.0 | 26.7 | 9.2 |
| Cash EBITDA 1) | 32.7 | 6.2 | 91.3 | 19.2 |
| Depreciation and Amortisaton (excl. Portfolio Amortisation) | -1.5 | -1.3 | -4.3 | -3.9 |
| Net Financial Items | -7.7 | -1.0 | -21.7 | -1.9 |
| Tax | -0.4 | 0.6 | -1.1 | -0.1 |
| Net Result | 0.4 | 0.3 | -0.4 | 3.2 |
| Cash and Cash Equivalents at end of Period 2) | 112.0 | 54.7 | 112.0 | 54.7 |
| Acquired portfolios during the Period 3) | 112.6 | 7.0 | 226.8 | 127.8 |
| Book Value of portfolios at end of Period 3) | 631.7 | 246.3 | 631.7 | 246.3 |
| Gross Collection on Portfolios during the quarter 3) | 44.2 | 14.0 | 127.0 | 38.7 |
| Estimated Remaining Collection (ERC) at end of quarter 3) | 1,125.1 | 525.8 | 1,125.1 | 525.8 |
| Interest Bearing Debt at end of Period | 477.4 | 116.1 | 477.4 | 116.1 |
| Number of Employees (FTE) at end of Period | 1,023 | 892 | 1,023 | 892 |
1) Cash EBITDA is adjusted for calculated cost of share option program, portfolio amortisations, revaluations and REO cost of sales.
2) Restricted cash excluded.
3) Includes NPL and REO portfolios.
Continued margin expansion as Axactor delivers a 397% EBITDA growth for the third quarter of 2018 compared to the same quarter last year. The EBITDA for Q3 2018 ended at EUR 10.0m with a margin of 21%, compared to EUR 2.0m and 10% for Q3 2017. Triple digit gross revenue growth is achieved for all three quarters so far in 2018, and the recorded gross revenue for the third quarter ended at EUR 56.5m compared to EUR 23.6m for Q3 2017. To secure future growth, Axactor has invested EUR 112.6m in NPL and REO portfolios during the third quarter of 2018, as well as signing two significant 3PC contracts in Spain. To reduce the company's funding cost, a refinancing deal for the existing REO portfolios was closed with Nomura International plc, freeing up a total of approximately EUR 96m for new investments.
The growth continues for Axactor with an EBITDA of 10.0m in Q3 2018, compared to 2.0m in the same quarter last year. The EBITDA margin increased from 20% in Q2 2018 to 21% in Q3 2018, despite the fact that the third quarter is negatively impacted by the holiday period in both Scandinavia and across Southern Europe. This emphasizes Axactor's continued focus on scale benefits and efficiency through sharing of best practices and know-how across the Group. The Gross revenue for the quarter was EUR 56.5m, up from 23.6m in the same period last year. The cash flow remains strong, with a Cash EBITDA of 32.7m compared to 6.2m in Q3 2017.
The capital light business segments, meaning 3PC and ARM, continue to show a good development in Q3 2018, with respective growth rates compared to the same quarter last year of 31% and 9%. Spain secured two new contracts of significant size during the quarter and together with the other contracts signed earlier in the year Axactor is confident that the strong development will continue for the coming quarters. Sweden has now established both the 3PC and the ARM product and the first clients are starting to generate revenue. The ARM product is still in the start-up phase for Italy and Germany and is expected to generate revenue in these two geographies in 2019.
During Q3 2018, Axactor invested a total of EUR 112.6m in NPL and REO portfolios. The running forward flow volume is currently at a level of close to EUR 15m per month, and with new contracts signed during the third quarter, this is expected to increase further through Q4 2018 and into 2019. This volume will generate significant revenue for Axactor going forward, and the pipeline for NPL portfolios remains strong across the Axactor geographies. The collection performance vs original business case for NPL portfolios
continue the strong trend seen over the past quarters, with last twelve months (LTM) Q3 2018 numbers coming in at 105%. This illustrates the company's ability to deliver on its investments, and to increase the efficiency of the collection platforms. The LTM collection performance vs original business case for REO portfolios was 142% for Q3 2018, as the REO portfolios continue to liquidate quicker than initially anticipated. The REO business cases have a conservative build-up, however, and the REO performance is expected to converge towards business case over time.
In order to reduce the company's funding cost, a re-financing deal for the existing REO portfolios was closed with Nomura International plc in the quarter. The deal is entered into by Reolux Holding S.à.r.l., a jointly owned company with Geveran Trading Co. Limited. The funding cost for the deal with Nomura is made on favorable terms compared to alternative sources of available unrestricted funds in the Axactor Group. The transaction has freed up approximately EUR 88m in cash in Q3 2018, with a further committed EUR 8m for Q4 2018. The released funds are available for Axactor to deploy in new investments across the group. The agreement with Nomura can be upsized in the future for funding of new REO portfolios at an attractive price level.
In order to reduce the burden of administrative expenses and achieve a more efficient group structure, Axactor is currently in the process of relocating the company from Sweden to Norway. An important step in this process was finalized during Q3 2018, when the company was converted from an AB company to an SE (Societas Europaea) company. The new company name is "Axactor SE", with the company registration number 517100-0127. ISIN, ticker and instrument ID remains unchanged.
Gross revenue for the third quarter of 2018 was EUR 56.5m (23.6m), resulting in a growth of 139%. The third quarter of the year is generally a slow quarter in the European DCA business, and the gross revenue is thus down 15% when comparing to Q2 2018. The investments made in NPL and REO portfolios continue to drive growth, and there is a healthy development in 3PC and ARM. Total amortisation and revaluation of NPL portfolios was EUR 7.8m (3.5m) in Q3 2018, leaving the net revenue for the quarter at EUR 48.7m (20.1m).
NPL portfolios accounted for EUR 25.2m (13.7m) or 45% (58%) of total gross revenue in Q3 2018. The REO segment continues to increase its share of total revenues on the back of the large investments made over the previous twelve months, and accounted for EUR 19.0m (0.3m) or 34% (1%) of the gross revenue in Q3 2018. A total of EUR 112.6m (7.0m) was invested in portfolios during the quarter, whereof EUR 43.8m was invested in REOs. The large forward flow contracts signed during 2018 are starting to show in the quarterly investment figures, with a further increase expected over the coming months as more of the contracts become fully operational. The estimated monthly investment from contracted forward flow portfolios at the end of the year is approximately EUR 16m, with an additional upside if further contracts are closed during Q4 2018. In addition to the forward flows, two new one-off portfolios were acquired in Spain and the pipeline for both one-off and forward flow portfolios remains promising. The book value of NPL and REO portfolios at the end of the third quarter of 2018 was EUR 631.7m (246.3m), with a total estimated remaining collection (ERC) of EUR 1,125.1m (525.8m).
The 3PC segment delivered a gross revenue of EUR 10.8m (8.2m) in Q3 2018, and accounted for 19% (35%) of total gross revenue. The 3PC segment increased its share of total revenues compared to the previous quarter, bringing a slightly better balance to the business mix. Spain remains the main driver of the 3PC growth and announced an additional two new large contracts during the quarter.
Accounts Receivable Management (ARM) is currently being rolled out as a business segment throughout the Group. The Norwegian ARM business delivers modest, but stable growth, and the product is now live in Sweden. The ARM segment contributed EUR 1.5m (1.4m), or 3% (6%) of the total gross revenue for the third quarter of 2018.
The reported EBITDA for the third quarter of 2018 was EUR 10.0m (2.0m). The EBITDA margin came in at 21% (10%), up from 20% in Q2 2018. This increase is particularly strong when looking at the shift in business mix from the highmargin NPL segment to 3PC and ARM, compared to the previous quarter. In addition, the third quarter is usually slower than the second quarter, further illustrating Axactors ability to leverage on scale and skill benefits as the company continues to grow.
The cash EBITDA, (EBITDA excluding amortisation and revaluations of NPL portfolios and REO cost of sales, as well as calculated costs related to the share option program) was EUR 32.7m (6.2m) for Q3 2018. The strong cash flow from the investments made into NPL and REO portfolios is the main driver of the growth. This results in a strong cash conversion, with a gross margin (cash EBITDA divided by gross revenue) of 58% for the quarter.
Net profit for the period amounted to EUR 0.4m (0.3m) for the third quarter of 2018.
The total operating expenses for the third quarter of 2018 amounted to EUR 38.7m (18.1m). This includes REO cost of sales of EUR 14.6m (0.1m), representing the reversal of the book value of sold assets and comparable to the amortisation of NPL portfolios.
IT and local SG&A costs amounted to EUR 6.3m (5.0m) for the quarter. The increase can be attributed to increased size of the business.
Depreciation and amortisation excluding amortisation of NPL portfolios was EUR 1.5m (1.3m) for Q3 2018. More than half of the depreciation and amortisation is related to intangible assets acquired through the acquisition of subsidiaries, with IT and infrastructure assets making up most of the remaining amount.
Interest cost on outstanding debt for the third quarter of 2018 was EUR 7.0m (1.8m). Net financial items were negatively impacted by currency effects of EUR 0.3m (positive 0.9m). Adding other financial items, the total net financial items for the quarter ended at EUR -7.7m (-1.0m). This is a reduction of EUR 0.8m compared to Q2 2018, mainly driven by reduced interest costs following the re-financing of the REO portfolios closed in Q3 and the re-payment of subordinated loan notes made by Axactor Invest I in Q2 2018.
The tax expense for Q3 2018 was EUR 0.4m (positive 0.6m). The high effective tax rate is due to some loss-making entities not recognizing any new tax assets in the quarter, while at the same time some profit-making entities are in a taxable position.
The cash flow from operating activities in the third quarter of 2018 amounted to EUR 27.6m (4.9m). The cash EBITDA for Q3 2018 was EUR 32.7m. The main difference between the cash EBITDA and the cash flow from operating activities relates to an increase in net working capital, and taxes paid.
Acquisition of NPL and REO portfolios during Q3 2018 was EUR 112.6m (7.0m). Adjusting for deferred payment on one of the portfolios acquired, the total amount paid for portfolios in the quarter was EUR 110.0m (15.4m). In addition, Axactor continues to invest in IT systems to optimize efficiency, thus, the total cash flow from investments was EUR -112.0m (-18.0m).
Total cash flow from financing activities was EUR 75.5m (49.1m) in Q3 2018. The main element was the re-financing of the REO portfolios which brought approximately EUR 88m of cash into the company in the quarter. The re-financing was partially offset by a re-payment on the RCF loan in order to reduce interest cost. Total free cash and cash equivalents at the end of the period was EUR 112.0m (54.7m).
At the end of the third quarter of 2018, the total equity including minorities for the Group was EUR 326.7m, compared to EUR 259.9m in Q3 2017. The resulting equity ratio at the end of the quarter was 39%, compared to 65% at the same time last year.
The parent company's business activity is to manage the Group's operations. The result after tax for the third quarter 2018 ended at EUR -0.6m (1.2m). Total equity at the parent company at the end of the quarter was EUR 279.3m (272.2m).
Axactor expects significant growth on the back of the capex deployed in NPL and REO portfolios, as well as from the signed forward flow contracts. Q4 2018 is the first full quarter for several of the large forward flow contracts closed during Q2 and Q3 and additional contracts are starting in Q4. The pipeline for both one-off NPL transactions and forward flows remains strong across the Axactor geographies. Together with the Finnish market entry announced in October, Axactor is confident that the growth story will continue through Q4 and into 2019. Further more, we see a tendency of increased IRR on medium/large unsecured NPL portfolios. It is assumed
that this is the consequence of a more challenging funding situation for the industry, as well as a large volume of NPL portfolios for sale. Axactor, however, is in a comfortable liquidity situation with available funds to invest, and thus have a competitive advantage going forward.
Axactor believes a balanced business mix is an important success factor and intends to keep focusing on growth in the 3PC and ARM segments in addition to the growth in NPLs and REOs. The 3PC pipeline in Spain remains strong, and as of Q3 2018 Axactor Sweden has a full product offering including 3PC and ARM.
As the volume in each segment grows, Axactor will see increasing benefits of scale and efficiency. Through the 'One Axactor' program, the company focuses on implementing common values, strategies and systems, and on sharing of best practices. Axactor thus expect further margin expansion across business segments and geographies for the coming quarters.
This report has not been reviewed by the auditor.
Stockholm, 29 October 2018 The Board of Directors
Bjørn Erik Næss Chairman of the Board
Brita Eilertsen Board member
Lars Erich Nilsen Board member
Beate S. Nygårdshaug Board member
Merete Haugli Board member
Terje Mjøs Board member
Endre Rangnes Chief Executive Officer
| For the quarter end | YTD | ||||||
|---|---|---|---|---|---|---|---|
| EUR thousand | Note | 30 Sept 2018 |
30 Sept 2017 |
30 Sept 2018 |
30 Sept 2017 |
Full year 2017 |
|
| Net revenue | 3, 4 | 48,689 | 20,073 | 138,875 | 59,092 | 87,745 | |
| Other revenue | 0 | 0 | 0 | 2,040 | 2,040 | ||
| Total revenue | 48,689 | 20,073 | 138,875 | 61,133 | 89,785 | ||
| Cost of secured assets sold (REOs) | 7 | -14,598 | -124 | -38,074 | -124 | -1,445 | |
| Personnel expenses collection | -7,709 | -6,650 | -23,770 | -19,178 | -26,578 | ||
| Personnel expenses other | -3,893 | -5,027 | -14,337 | -12,949 | -18,378 | ||
| Operating expenses | -12,461 | -6,255 | -35,959 | -19,715 | -28,569 | ||
| EBITDA | 10,028 | 2,017 | 26,735 | 9,167 | 14,815 | ||
| Amortisation and depreciation | -1,507 | -1,340 | -4,323 | -3,915 | -5,327 | ||
| EBIT | 8,521 | 677 | 22,412 | 5,251 | 9,488 | ||
| Financial revenue | 5 | -169 | 958 | 395 | 2,818 | 3,070 | |
| Financial expenses | 5 | -7,551 | -1,998 | -22,086 | -4,737 | -10,585 | |
| Net financial items | -7,720 | -1,040 | -21,691 | -1,919 | -7,515 | ||
| Profit/(loss) before tax | 801 | -363 | 720 | 3,332 | 1,974 | ||
| Tax expense | -401 | 624 | -1,146 | -94 | 611 | ||
| Net profit/(loss) from continued operations | 399 | 261 | -425 | 3,238 | 2,585 | ||
| Net profit/(loss) to minority interest | -866 | 0 | -524 | 0 | -32 | ||
| Net profit/(loss) to equity holders | 1,266 | 261 | 99 | 3,238 | 2,617 | ||
| Earnings per share: basic | 0.008 | 0.000 | 0.001 | 0.003 | 0.002 | ||
| Earnings per share: diluted | 0.007 | 0.000 | 0.001 | 0.003 | 0.002 |
| For the quarter end | YTD | ||||
|---|---|---|---|---|---|
| EUR thousand | 30 Sept 2018 |
30 Sept 2017 |
30 Sept 2018 |
30 Sept 2017 |
Full year 2017 |
| Net profit/(loss) for the period net of income tax | 399 | 261 | -425 | 3,238 | 2,585 |
| Items that will not be classified subsequently to profit or loss | |||||
| Remeasurement of pension plans | 0 | 0 | 0 | 0 | 8 |
| Items that may be classified subsequently to profit or loss | |||||
| Foreign currency translation differences - foreign operations | 418 | 1,408 | -478 | -3,899 | -3,702 |
| Other comprehensive income/(loss) for the period net of income tax |
418 | 1,408 | -478 | -3,899 | -3,694 |
| Total comprehensive income for the period attributable to: | 818 | 1,668 | -903 | -661 | -1,109 |
| - Equity holders of the parent company | 1,684 | 1,668 | -379 | -661 | -1,077 |
| - Non-Controlling interests | -866 | 0 | -524 | 0 | -32 |
| EUR thousand | Note | 30 Sept 2018 |
30 Sept 2017 |
31 Dec 2017 |
|---|---|---|---|---|
| ASSETS | ||||
| Intangible non-current assets | ||||
| Intangible assets | 19,544 | 18,386 | 18,359 | |
| Goodwill | 54,462 | 54,756 | 53,582 | |
| Deferred tax asset | 4,239 | 2,234 | 3,945 | |
| Tangible non-current assets | ||||
| Property, Plant and equipment | 2,795 | 2,506 | 2,499 | |
| Financial non-current assets | ||||
| Investment in joint ventures | 0 | 3,052 | 0 | |
| Purchased debt portfolios | 6 | 419,108 | 237,927 | 317,150 |
| Other long term receivables | 1,155 | 1,123 | 1,065 | |
| Other long term investments | 170 | 226 | 191 | |
| Total non-current assets | 501,473 | 320,210 | 396,791 | |
| Current assets | ||||
| Stock of secured assets REO's | 7 | 212,555 | 8,373 | 154,101 |
| Current receivables | 7,671 | 7,227 | 8,047 | |
| Other current assets | 8,545 | 8,860 | 13,070 | |
| Restricted cash | 54 | 2,589 | 1,878 | |
| Cash and cash equivalents | 112,018 | 54,748 | 48,604 | |
| Total current assets | 340,844 | 81,797 | 225,700 | |
| TOTAL ASSETS | 842,317 | 402,007 | 622,491 |
| EUR thousand | Note | 30 Sept 2018 |
30 Sept 2017 |
31 Dec 2017 |
|---|---|---|---|---|
| EQUITY AND LIABILITIES | ||||
| Equity attributable to equity holders of the parent | ||||
| Share Capital | 8 | 80,842 | 79,377 | 79,377 |
| Other paid-in equity | 199,135 | 195,773 | 196,298 | |
| Retained earnings profit/(loss) | -18,619 | -15,017 | -15,630 | |
| Reserves | -465 | -184 | 13 | |
| Non-controlling interests | 65,801 | 0 | 31,776 | |
| Total equity | 326,694 | 259,948 | 291,833 | |
| Non-current liabilities | ||||
| Non-current interest bearing debt | 9 | 368,161 | 71,072 | 237,571 |
| Deferred tax liabilities | 5,261 | 6,815 | 5,887 | |
| Other non-current liabilities | 3,736 | 3,447 | 3,002 | |
| Total non-current liabilities | 377,159 | 81,334 | 246,459 | |
| Current liabilities | ||||
| Accounts payables | 4,214 | 2,753 | 4,029 | |
| Current portion of non-current borrowings | 9 | 109,244 | 45,020 | 61,189 |
| Taxes Payable | 1,694 | -445 | 1,376 | |
| Other current liabilities | 23,313 | 13,398 | 17,603 | |
| Total current liabilities | 138,465 | 60,725 | 84,198 | |
| TOTAL EQUITY AND LIABILITIES | 842,317 | 402,007 | 622,491 |
| For the quarter end | YTD | |||||
|---|---|---|---|---|---|---|
| EUR thousand | Note | 30 Sept 2018 |
30 Sept 2017 |
30 Sept 2018 |
30 Sept 2017 |
Full year 2017 |
| Operating actitvities | ||||||
| Profit before tax | 801 | -363 | 721 | 3,333 | 1,974 | |
| Taxes paid | -192 | 0 | -2,373 | -1,419 | -1,531 | |
| Adjustments for: | ||||||
| - Finance income and expense | 7,720 | 1,040 | 21,691 | 1,918 | 7,514 | |
| - Amortisation of debt portfolios | 7,818 | 3,544 | 25,342 | 9,115 | 14,957 | |
| - Cost of sales stock of secured assets | 14,598 | 124 | 38,074 | 124 | 1,445 | |
| - Depreciation and amortisation | 1,507 | 1,340 | 4,324 | 3,915 | 5,327 | |
| - Calculated cost of employee share options | 231 | 588 | 1,180 | 1,259 | 1,806 | |
| - Unrealised foreign currency (gains)/losses | -1,147 | 0 | -1,956 | 0 | 0 | |
| Change in Working capital | -3,743 | -1,414 | 4,713 | -4,749 | -8,099 | |
| Net cash flows operating activities | 27,593 | 4,859 | 91,716 | 13,496 | 23,393 | |
| Investing actitvities | ||||||
| Purchase of debt portfolios and REO's | 6, 7 | -110,013 | -15,449 | -222,146 | -127,551 | -355,202 |
| Investment in subsidiaries | 0 | 0 | 0 | -1,409 | -1,409 | |
| Purchase of intangible and tangible assets | -2,021 | -2,578 | -5,813 | -4,023 | -5,401 | |
| Interest received | 0 | 60 | 0 | 96 | 96 | |
| Net cash flows investing activities | -112,034 | -17,967 | -227,959 | -132,712 | -361,741 | |
| Financing actitvities | ||||||
| Proceeds from borrowings | 9 | 120,973 | 3,000 | 336,058 | 79,057 | 277,752 |
| Repayment of debt | 9 | -49,387 | -14,685 | -154,309 | -34,919 | -42,485 |
| Interest paid | -5,034 | -1,371 | -16,532 | -3,433 | -5,315 | |
| Loan fees paid | 9 | -2,499 | -136 | -5,058 | -2,114 | -10,188 |
| Proceeds from share issue | 0 | 63,858 | 3,147 | 75,274 | 75,274 | |
| Proceeds from non-controlling interests | 11,423 | 0 | 34,548 | 0 | 31,808 | |
| Share issue costs | 0 | -1,578 | -21 | -1,863 | -1,885 | |
| Net cash flows financing activities | 75,476 | 49,088 | 197,833 | 112,002 | 324,961 | |
| Currency translation | 0 | 0 | 0 | 0 | -117 | |
| Net change in cash and cash equivalents | -8,965 | 35,980 | 61,590 | -7,214 | -13,387 | |
| Cash and cash equivalents at the beginning of period | 121,037 | 21,357 | 50,482 | 64,551 | 63,986 | |
| Cash and cash equivalents at end of period | 112,072 | 57,337 | 112,072 | 57,337 | 50,482 |
| Equity related to the shareholders of the Parent Company | |||||||
|---|---|---|---|---|---|---|---|
| Restricted Equity |
Non restricted | ||||||
| EUR thousand | Share capital |
Other paid in capital |
Exchange differences |
Retained earnings and profit for the year |
Total | Non controlling interest |
Total Equity |
| Closing balance 31 December 2016 | 64,198 | 262,127 | 3,714 | -147,151 | 182,888 | 182,888 | |
| Balance 1 January 2017 | 64,198 | 262,127 | 3,714 | -147,151 | 182,888 | 182,888 | |
| Allocation of result from discontinued operations 1) | -128,896 | 128,896 | 0 | ||||
| Net result for the period | 2,617 | 2,617 | -32 | 2,585 | |||
| Comprehensive Profit/(loss) Foreign currency translation differences - foreign operations |
-3,702 | -3,702 | -3,702 | ||||
| Comprehensive Profit/(loss) Remeasurement of pension plans |
8 | 8 | 8 | ||||
| Total comprehensive result for the period | 0 | 0 | -3,702 | 2,625 | -1,077 | -32 | -1,109 |
| Minority of newly consolidated companies | 31,807 | 31,807 | |||||
| New Share issues, May | 2,617 | 8,799 | 11,417 | 11,417 | |||
| New Share issues, August | 3,957 | 16,223 | 20,180 | 20,180 | |||
| New Share issues, September | 8,605 | 35,073 | 43,678 | 43,678 | |||
| Costs related to fund-raising | -1,885 | -1,885 | -1,885 | ||||
| Share based payment | 1,806 | 1,806 | 1,806 | ||||
| Grant of Warrants 2) | 3,051 | 3,051 | 3,051 | ||||
| Closing balance 31 December 2017 | 79,377 | 196,298 | 13 | -15,630 | 260,057 | 31,776 | 291,833 |
| Balance 1 January 2018 | 79,377 | 196,298 | 13 | -15,630 | 260,057 | 31,776 | 291,833 |
| Costs related to share issues | -26 | -26 | -26 | ||||
| Share based payment | 1,181 | 1,181 | 1,181 | ||||
| Comprehensive Profit/(loss) Foreign currency translation differences - foreign operations |
-478 | -478 | -478 | ||||
| Adjustment on initial application of IFRS 15 (net of tax) |
-3,087 | -3,087 | -3,087 | ||||
| Net capital increase/decrease of NCI | 34,549 | 34,549 | |||||
| Result of the period | 99 | 99 | -524 | -425 | |||
| New Share issues (exercise of share options) | 1,465 | 1,682 | 3,147 | 3,147 | |||
| New Share issues | 0.05 | 0 | 0 | ||||
| Closing balance 30 Sept 2018 | 80,842 | 199,135 | -465 | -18,618 | 260,893 | 65,801 | 326,694 |
1) Ref. resolution in Annual general meeting on 31 May 2017.
2) 130 million American style warrants in Axactor to Geveran with an exercise price of NOK 3.25 have been granted. The warrants expire after two years.
| For the quarter end | YTD | ||||
|---|---|---|---|---|---|
| EUR thousand Note |
30 Sept 2018 |
30 Sept 2017 |
30 Sept 2018 |
30 Sept 2017 |
Full year 2017 |
| Other operating income | 174 | 711 | 1,505 | 4,253 | 5,809 |
| Operating expenses | -909 | -1,486 | -3,654 | -5,255 | -7,380 |
| Personnel expenses | |||||
| EBITDA | -735 | -775 | -2,149 | -1,002 | -1,571 |
| Amortisation and depreciation | 0 | 0 | 0 | 0 | 0 |
| EBIT | -735 | -775 | -2,149 | -1,002 | -1,571 |
| Financial revenue | 5,782 | 2,512 | 12,302 | 4,638 | 5,347 |
| Financial expenses | -5,691 | -583 | -10,373 | -700 | -4,971 |
| Net financial items | 90 | 1,929 | 1,929 | 3,938 | 376 |
| Profit/(loss) before tax | -644 | 1,154 | -220 | 2,936 | -1,195 |
| Tax expense | 0 | 0 | 0 | 0 | 0 |
| Net profit/(loss) to equity holders | -644 | 1,154 | -220 | 2,936 | -1,195 |
| EUR thousand | 30 Sept Note 2018 |
30 Sept 2017 |
31 Dec 2017 |
|---|---|---|---|
| ASSETS | |||
| Intangible non-current assets | |||
| Investment in subsidiaries and joint ventures | 150,913 | 123,404 | 129,562 |
| Loans to group companies | 254,337 | 103,918 | 135,602 |
| Other long-term receivables | 170 | 226 | 170 |
| Total non-current assets | 405,420 | 227,548 | 265,334 |
| Current assets | |||
| Short-term intercompany receivables | 8,149 | 3,752 | 3,238 |
| Other current assets | 1,572 | 30 | 2,838 |
| Restricted cash | 0 | 418 | 406 |
| Cash and cash equivalents | 13,186 | 40,842 | 5,235 |
| Total current assets | 22,907 | 45,041 | 11,717 |
| TOTAL ASSETS | 428,326 | 272,590 | 277,050 |
| EQUITY AND LIABILITIES | |||
| Restricted equity | |||
| Share Capital | 80,842 | 79,377 | 79,377 |
| Statutory reserve | 240 | 240 | 240 |
| Total restricted equity | 81,081 | 79,617 | 79,617 |
| Non-restricted equity | |||
| Share premium reserve | 199,139 | 195,779 | 196,304 |
| Retained earnings | -718 | -6,133 | 476 |
| Result for the period | -220 | 2,936 | -1,195 |
| Total non-restricted equity | 198,201 | 192,582 | 195,585 |
| TOTAL SHAREHOLDERS EQUITY | 279,282 | 272,198 | 275,202 |
| LIABILITIES | |||
| Non-current liabilities | |||
| Non-current interest bearing debt | 7 148,628 |
0 | 0 |
| Long term intercompany liabilities | 0 | 0 | 0 |
| Other long term liabilities | 0 | 0 | 0 |
| Total non-current liabilities | 148,628 | 0 | 0 |
| Current liabilities | |||
| Accounts payables | 63 | 189 | 187 |
| Short-term intercompany liabilities | 0 | 0 | 1,531 |
| Other current liabilities | 353 | 203 | 131 |
| Total current liabilities | 416 | 392 | 1,849 |
| TOTAL EQUITY AND LIABILITIES | 428,326 | 272,590 | 277,050 |
| Restricted Equity | Non-restricted Equity | ||||||
|---|---|---|---|---|---|---|---|
| EUR thousand | Share capital | Statutory reserve |
Share premium reserve |
Exchange differences |
Retained earnings |
Result of the period |
Total |
| Balance on 1 January 2017 | 64,197 | 240 | 262,131 | -23 | -132,845 | 4,449 | 198,149 |
| Transfer of prior years net result | 0 | 0 | 0 | 4,449 | -4,449 | 0 | |
| Allocation of result from discontinued operations 1) |
-128,896 | 128,896 | 0 | ||||
| New Share issues, May | 2,617 | 8,799 | 11,416 | ||||
| New Share issues, August | 3,957 | 16,223 | 20,180 | ||||
| New Share issues, September | 8,605 | 35,073 | 43,678 | ||||
| Costs related to fund-raising | -1,885 | -1,885 | |||||
| Share based payment | 1,806 | 1,806 | |||||
| Grant of Warrants 2) | 3,051 | 3,051 | |||||
| Result of the period | -1,195 | -1,195 | |||||
| Closing balance on 31 December 2017 | 79,377 | 240 | 196,302 | -23 | 500 | -1,195 | 275,202 |
| Balance on 1 January 2018 | 79,377 | 240 | 196,302 | -23 | 500 | -1,195 | 275,202 |
| Transfer of prior years net result | -1,195 | 1,195 | 0 | ||||
| Costs related to share issues | -26 | -26 | |||||
| Share based payment | 1,181 | 1,181 | |||||
| Result of the period | -220 | -220 | |||||
| New Share issues (exercise of share options) | 1,465 | 1,682 | 3,147 | ||||
| New Share issues | 0.05 | 0 | |||||
| Closing balance on 30 Sept 2018 | 80,842 | 240 | 199,139 | -23 | -694 | -220 | 279,282 |
1) Ref. resolution in Annual general meeting on 31 May 2017.
2) 130 million American style warrants in Axactor to Geveran with an exercise price of NOK 3.25 have been granted. The warrants expire after two years.
| EUR thousand | YTD 2018 | 2017 | 2016 | 2015 | 2014 | |
|---|---|---|---|---|---|---|
| Number of outstanding shares at beginning of reporting period 1) |
Number | 1,516,488,769 | 1,226,488,769 | 596,614,360 | 90,809,360 | 18,174,922 |
| New share issue 4) | Number | 27,992,251 | 290,000,000 | 629,874,409 | 505,805,000 | 72,634,438 |
| Number of outstanding shares at the end of reporting period 3) |
Number | 154,448,102 | 1,516,488,769 | 1,226,488,769 | 596,614,360 | 90,809,360 |
| Average number of shares 1) 3) | Number | 152,962,958 | 1,327,030,991 | 849,072,460 | 133,687,416 | 29,804,775 |
| Operating result, for continued operations | kEUR | 22,412 | 9,488 | -9,614 | -3,360 | -1,214 |
| Result after tax | kEUR | -425 | 2,585 | -11,169 | -17,810 | -5,055 |
| Operating result per share | EUR | 0.147 | 0.007 | -0.011 | -0.02 | -0.15 |
| Result after financial items per share | EUR | 0.005 | 0.001 | -0.014 | -0.05 | -0.15 |
| Result per share after tax | EUR | -0.003 | 0.002 | -0.013 | -0.13 | -0.17 |
| Shareholders equity per share before dilution 1) | EUR | 1.706 | 0.220 | 0.238 | 0.09 | 0.19 |
| Dividend 2) | kEUR | 0 | 0 | 0 | 0 | 59.69 |
| Price per share at the end of reporting period | NOK | 24.32 | 2.90 | 2.650 | 2.00 | 1.42 |
1) The average number of shares during the twelve month period 2013 has been adjusted for the reversed split as from the beginning of the year.
2) Total dividend, not per share.
3) After effect of reverse split 31 May 2018. Ratio ten old shares give one new share.
4) Before reverse split.
The Parent Company Axactor SE (Company) is a company domiciled in Sweden. These condensed consolidated interim statements ("interim financial statements") comprise the Company and its subsidiaries (together referred to as "the Group"). The group is primery involved in debt management, specialising on both purchasing and collection on own portfolios and providing collection services for 3rd party owned portfolio. The activities are further described in note 3.
The interim report has been prepared in accordance with IAS 34 and recommentations RFR 1 and the Swedish Financial Reporting Board (RFR), and recommendation RFR 2 and the Annual Accounts Act with regards to the Parent Company. The accounting principles applied correspond to those described in the Annual Report for the Financial Year 2017. This interim report does not contain all the information and disclosures available in the annual report and the interim report should be read together with the Annual Report for the Financial Year 2017.
In preparing these interim financial statements, management has made judgements and estimates that effects the application and accounting policies and the reported amounts of assets and lliabilities, income and expenses. Actual result may differ from these estimates. Critical Accounting estimates and judgements in terms of accounting policies are more comprehensive discussed in the Company Annual report for the Financial Year 2017, which is available on Axactors website: www. axactor.com
The significant judgements made by managements applying the Group's accounting policies and the key resources of estimation uncertainty were the same as those described in the last annual financial statements, except for new significant judgements of estimation uncertainty related to the application of IFRS 15, which are described below.
This is the first set of Group's financial statements where IFRS 15 and IFRS 9 have been applied. The treatment of the NPL portfolios under IFRS 9 will remain as according to IAS 39.
The Group adopted IFRS 15 using the modified retrospective method with effect of applying this standard from 1 January 2018 without presenting 2017 restated.
The following table summarises the impact, net of tax, of transision to IFRS 15 on retained earnings and NCI at 1 January 2018:
| EUR thousand | Total |
|---|---|
| Retained earnings | |
| Accrued revenue | 3,304 |
| Related tax | 217 |
| Impact at 1 January 2018 | 3,087 |
| Non-controlling interests | |
| Impact | 0 |
Axactor's regular business activities entail exposure to various types of risk. The company manages such risks proactively and the board of directors regularly analyses its operations and potential risk factors and takes steps to reduce risk exposure. Axactor gives strong emphasis to quality assurance and has quality systems implemented, or under implementation in line with the requirements applicable to its business operations. The risks include but are not limited to credit risk, risk inherent in purchased debt, interst rate risk, regulatory risk, liquidity risks and financing risks. For a more elaborate discussion on the aforementioned risks one is referred to the Company's Annual Report for the Financial Year 2017, which is available on Axactor website: www.axactor.com (note 3 of the Group financial statement).
Axactor delivers credit management services and the company's revenue is derived from the following four operating segments: Non-Performing Loans (NPL), Real Estate Owned (REO), Third Party Collection (3PC) and Accounts Receivable Management (ARM). Axactor's operations are managed through these operating segments.
The NPL segment invests in portfolios of non-performing loans. Subsequently, the outstanding debt is collected through either amicable or legal proceedings.
The REO segment invests in real estate assets held for sale.
The 3PC segment's main focus is to perform debt collection services on behalf of third party clients. They apply both amicable and legal proceedings in order to collect the non-performing loans, and typically receive a commission for these services. They also help creditors to prepare documentation for future legal proceedings against debtors, and for this they typically receive a fixed fee.
ARM handles claims between the invoice date and the default date. The customer issues an invoice to the debtor and Axactor ARM monitors the claim and makes sure the payment is made in due time. If a debtor defaults on the payment, the claim is typically transferred to 3PC for debt collection services.
Axactor reports its business through reporting segments which corresponds to the operating segments. Segment profitability and country profitability are the two most important dimensions when making strategic priorities and deciding where to allocate the Group's resources.
Segment revenue reported below represents revenue generated from external customers. There are no intersegment sales in the current year.
The accounting policies of the reportable segments are the same as the Group's accounting policies described in note 1. Segment contribution margin represents contribution margin earned by each segment without allocation of management fee, central administration costs, other gains and losses as well as finance costs. The measurement basis of the performance of the segment is the segment's contribution margin.
| EUR thousand | NPL | REO | 3PC 1) | ARM | Eliminations/ Not allocated |
Total |
|---|---|---|---|---|---|---|
| Collections on own portfolios | 25,214 | 18,984 | 0 | 0 | 0 | 44,198 |
| Other operating revenue | 0 | 0 | 10,795 | 1,514 | 0 | 12,309 |
| Portfolio amortisation and revaluation | -7,818 | 0 | 0 | 0 | 0 | -7,818 |
| Net revenue | 17,396 | 18,984 | 10,795 | 1,514 | 0 | 48,689 |
| REO cost of sales | 0 | -14,592 | 0 | 0 | 0 | -14,592 |
| Other direct operating expenses | -5,449 | -2,250 | -7,484 | -736 | 0 | -15,919 |
| Contribution margin | 11,947 | 2,141 | 3,311 | 777 | 0 | 18,177 |
| Local SG&A, IT and corporate cost | -8,149 | -8,149 | ||||
| EBITDA | -8,149 | 10,028 | ||||
| Total Opex | -5,449 | -16,842 | -7,484 | -736 | -8,149 | -38,661 |
| CM1 margin | 68.7 % | 11.3 % | 30.7 % | 51.4 % | na | 37.3 % |
| EBITDA margin | 20.6 % | |||||
| Dopex / Gross revenue | 21.6 % | 88.7 % | 69.3 % | 48.6 % | na | 54.0 % |
| Local SG&A, IT and corporate cost / Gross revenue |
14.4 % |
1) External revenue.
| EUR thousand | NPL | REO | 3PC 1) | ARM | Eliminations/ Not allocated |
Total |
|---|---|---|---|---|---|---|
| Collections on own portfolios | 13,702 | 306 | 0 | 0 | 0 | 14,008 |
| Other operating revenue | 0 | 0 | 8,214 | 1,395 | 0 | 9,609 |
| Portfolio amortisation and revaluation | -3,544 | 0 | 0 | 0 | 0 | -3,544 |
| Net revenue | 10,158 | 306 | 8,214 | 1,395 | 0 | 20,073 |
| REO cost of sales | 0 | -124 | 0 | 0 | 0 | -124 |
| Other direct operating expenses | -3,291 | -79 | -6,170 | -752 | 0 | -10,293 |
| Contribution margin | 6,867 | 103 | 2,044 | 643 | 0 | 9,657 |
| Local SG&A, IT and corporate cost | -7,640 | -7,640 | ||||
| EBITDA | -7,640 | 2,017 | ||||
| Total Opex | -3,291 | -203 | -6,170 | -752 | -7,640 | -18,057 |
| CM1 margin | 67.6 % | 33.7 % | 24.9 % | 46.1 % | na | 48.1 % |
| EBITDA margin | 10.0 % | |||||
| Dopex / Gross revenue | 24.0 % | 66.3 % | 75.1 % | 53.9 % | na | 44.1 % |
| Local SG&A, IT and corporate cost / Gross revenue |
32.3 % |
1) External revenue.
2) Settlement former BoD.
| EUR thousand | NPL | REO | 3PC 1) | ARM | Eliminations/ Not allocated |
Total |
|---|---|---|---|---|---|---|
| Collections on own portfolios | 77,437 | 49,539 | 0 | 0 | 0 | 126,976 |
| Other operating revenue | 0 | 0 | 32,536 | 4,705 | 0 | 37,241 |
| Portfolio amortisation and revaluation | -25,342 | 0 | 0 | 0 | 0 | -25,342 |
| Net revenue | 52,095 | 49,539 | 32,536 | 4,705 | 0 | 138,875 |
| REO cost of sales | 0 | -38,068 | 0 | 0 | 0 | -38,068 |
| Direct operating expenses | -16,404 | -5,901 | -23,788 | -2,213 | 0 | -48,307 |
| Contribution margin | 35,691 | 5,569 | 8,748 | 2,492 | 0 | 52,500 |
| Local SG&A, IT and corporate cost | -25,765 | -25,765 | ||||
| EBITDA | -25,765 | 26,735 | ||||
| Total Opex | -16,404 | -43,970 | -23,788 | -2,213 | -25,765 | -112,140 |
| CM1 margin | 68.5 % | 11.2 % | 26.9 % | 53.0 % | na | 37.8 % |
| EBITDA margin | 19.3 % | |||||
| Dopex / Gross revenue | 21.2 % | 88.8 % | 73.1 % | 47.0 % | na | 52.6 % |
| Local SG&A, IT and corporate cost / Gross revenue |
15.7 % |
1) External revenue.
| EUR thousand | NPL | REO | 3PC 1) | ARM | Eliminations/ Not allocated |
Total |
|---|---|---|---|---|---|---|
| Collections on own portfolios | 38,469 | 306 | 0 | 0 | -30 | 38,746 |
| Other operating revenue / Other revenue | 0 | 0 | 25,026 | 4,437 | 2,040 2) | 31,503 |
| Portfolio amortisation and revaluation | -9,115 | 0 | 0 | 0 | 0 | -9,115 |
| Total revenue | 29,354 | 306 | 25,026 | 4,437 | 2,010 | 61,133 |
| REO cost of sales | 0 | -124 | 0 | 0 | 0 | -124 |
| Other direct operating expenses | -9,342 | -79 | -18,576 | -2,394 | 0 | -30,390 |
| Contribution margin | 20,012 | 103 | 6,450 | 2,043 | 2,010 | 30,619 |
| Local SG&A, IT and corporate cost | -21,452 | -21,452 | ||||
| EBITDA | -19,442 | 9,167 | ||||
| Total Opex | -9,342 | -203 | -18,576 | -2,394 | -21,451 | -51,966 |
| CM1 margin | 68.2 % | 33.7 % | 25.8 % | 46.0 % | na | 50.1 % |
| EBITDA margin | 15.0 % | |||||
| Dopex / Gross revenue | 24.3 % | 66.3 % | 74.2 % | 54.0 % | na | 43.4 % |
| Local SG&A, IT and corporate cost / Gross revenue |
30.5 % |
1) External revenue.
2) Settlement former BoD.
| For the quarter end | YTD | ||||
|---|---|---|---|---|---|
| EUR thousand | 30 Sept 2018 |
30 Sept 2017 |
30 Sept 2018 |
30 Sept 2017 |
Full year 2017 |
| Germany | 4,910 | 4,845 | 14,228 | 14,023 | 19,614 |
| Italy | 1,100 | 1,728 | 5,058 | 6,244 | 8,161 |
| Norway | 7,274 | 2,379 | 14,093 | 7,927 | 11,015 |
| Spain | 33,304 | 8,588 | 98,627 | 24,223 | 40,037 |
| Sweden | 2,101 | 2,533 | 6,869 | 6,675 | 8,918 |
| Other revenue, group | 0 | 0 | 0 | 2,040 | 2,040 |
| Total revenue | 48,689 | 20,073 | 138,875 | 61,132 | 89,785 |
Portfolios can be acquired in another country than the resident of the debtor. The infomation in the above table is based on the location of the customers/debtors.
| Q1 2018 | Q2 2018 | Q3 2018 | |||||||
|---|---|---|---|---|---|---|---|---|---|
| EUR thousand | NPL | REOs | Total | NPL | REOs | Total | NPL | REOs | Total |
| Yield 1) | 18,405 | 18,405 | 16,061 | 16,061 | 17,781 | 17,781 | |||
| CU1 2) | -1,360 | -1,360 | 4,016 | 4,016 | -1,712 | -1,712 | |||
| CU2 3) | -1,745 | -1,745 | -1,385 | -1,385 | 893 | 893 | |||
| CU2 tail 4) | 339 | 339 | 367 | 367 | 434 | 434 | |||
| REOs | 8,672 | 8,672 | 21,883 | 21,883 | 18,984 | 18,984 | |||
| Net Revenue | 15,639 | 8,672 | 24,312 | 19,060 | 21,883 | 40,943 | 17,396 | 18,984 | 36,380 |
1) The effective interest rate on portfolios.
2) Catch up 1. Over- or under-performance compared to collection forecast.
3) Catch up 2. Revaluations and net present value of changes in forecast.
4) Catch up 2 tail. The net present value effect of rolling 180 months forecast.
| NPL | REOs | Total |
|---|---|---|
| 52,248 | 52,248 | |
| 943 | 943 | |
| -2,237 | -2,237 | |
| 1,141 | 1,141 | |
| 49,539 | 49,539 | |
| 52,095 | 49,539 | 101,634 |
1) The effective interest rate on portfolios.
2) Catch up 1. Over- or under-performance compared to collection forecast.
3) Catch up 2. Revaluations and net present value of changes in forecast.
4) Catch up 2 tail. The net present value effect of rolling 180 months forecast.
| EUR thousand | NPL | REOs | Total |
|---|---|---|---|
| Yield 1) | 44,731 | 44,731 | |
| CU1 2) | 0 | 0 | |
| CU2 3) | -1,126 | -1,126 | |
| CU2 tail 4) | 0 | 0 | |
| REOs | 2,282 | 2,282 | |
| Net Revenue | 43,605 | 2,282 | 45,887 |
1) The effective interest rate on portfolios.
2) Catch up 1. Over- or under-performance compared to collection forecast.
3) Catch up 2. Revaluations and net present value of changes in forecast.
4) Catch up 2 tail. The net present value effect of rolling 180 months forecast.
| For the quarter end | YTD | ||||
|---|---|---|---|---|---|
| EUR thousand | 30 Sept 2018 |
30 Sept 2017 |
30 Sept 2018 |
30 Sept 2017 |
Full year 2017 |
| Financial revenue | |||||
| Interest on bank deposits | 5 | 60 | 7 | 97 | 109 |
| Exchange gains | 0 | 920 | 0 | 2,546 | 2,704 |
| Exchange gains realised | 76 | 0 | 364 | 0 | 0 |
| Net unrealised Exchange gains | -190 | 0 | 0 | 0 | 0 |
| Other financial income | -59 | -22 | 24 | 185 | 257 |
| Total financial revenue | -168 | 958 | 395 | 2,828 | 3,070 |
| Financial expenses | |||||
| Interest expenses on borrowings | -7,013 | -1,837 | -20,195 | -4,370 | -6,942 |
| Exchange losses | 0 | -4 | 0 | -162 | -3,144 |
| Exchange losses realised | -61 | 0 | -279 | 0 | 0 |
| Net unrealised Exchange losses | -125 | 0 | -125 | 0 | 0 |
| Other financial expenses | -353 | -157 | -1,487 | -214 | -498 |
| Total financial expenses | -7,552 | -1,998 | -22,086 | -4,746 | -10,585 |
| Net financial items | -7,720 | -1,040 | -21,691 | -1,919 | -7,515 |
| EUR thousand | 30 Sept 2018 |
30 June 2018 |
31 March 2018 |
30 Sept 2017 |
30 June 2017 |
31 March 2017 |
31 Dec 2017 |
|---|---|---|---|---|---|---|---|
| Acquisition cost, opening balance | 337,391 | 337,391 | 337,391 | 131,729 | 131,729 | 131,729 | 131,729 |
| Purchase | 133,042 | 64,264 | 46,792 | 119,442 | 111,072 | 66,288 | 206,446 |
| Disposals | -7,246 | -7,246 | -7,246 | -132 | 0 | 0 | -132 |
| Classification | -1,224 | -2,998 | 0 | 0 | 0 | 0 | 0 |
| Repossession of secured assets | -2,578 | 0 | 0 | 0 | 0 | 0 | 0 |
| Translation differences | -2,305 | -5,412 | -3,050 | -110 | -63 | 0 | -652 |
| Accumulated acquisition cost | 457,080 | 385,999 | 373,887 | 250,929 | 242,738 | 198,017 | 337,391 |
| Amortisation & Revalution, opening balance | -20,240 | -20,242 | -20,242 | -3,744 | -3,744 | -3,833 | -3,744 |
| Amortisation and revaluation of the year 1) | -25,342 | -17,524 | -7,050 | -9,115 | -5,575 | -2,283 | -14,949 |
| Disposals | 7,246 | 7,246 | 7,246 | 0 | 0 | 0 | 55 |
| Classification | 1,224 | 2,998 | -628 | 0 | 0 | 0 | 0 |
| Repossession of secured assets | -235 | 0 | 0 | 0 | 0 | 0 | 0 |
| Impairment | -628 | -628 | 0 | 0 | 0 | 0 | 0 |
| Translation differences | 3 | 655 | 947 | -144 | 0 | 0 | -1,603 |
| Accumulated amortisation, closing balance | -37,972 | -27,495 | -19,727 | -13,002 | -9,319 | -6,116 | -20,240 |
| Net book value | 419,109 | 358,505 | 354,158 | 237,927 | 233,419 | 191,901 | 317,150 |
1) Gain on disposals amounts EUR 2,254 million, netted in P&L as Portfolio Amortisation & revaluation
| EUR thousand | 30 Sept 2018 | 30 June 2018 | 30 Sept 2017 | 30 June 2017 | 31 Dec 2017 |
|---|---|---|---|---|---|
| Acquisition cost, opening balance | 154,101 | 154,101 | 0 | 0 | 0 |
| Purchase | 93,715 | 49,903 | 8,497 | 8,070 | 155,546 |
| Repossession from secured NPL | 2,813 | 0 | 0 | 0 | 0 |
| Cost of sold secured assets | -38,074 | -23,476 | -124 | 0 | -1,445 |
| Total | 212,555 | 180,528 | 8,373 | 8,070 | 154,101 |
| Number of assets | 7,388 | 6,161 | 600 | 600 | 4,800 |
| Number of shares | Share capital (EUR thousand) |
|
|---|---|---|
| At 1 January 2015 | 90,809,360 | 4,753,173 |
| New share issues | 505,805,000 | 26,475,007 |
| At 1 January 2016 | 596,614,360 | 31,228,180 |
| New share issues, February | 59,600,000 | 3,119,602 |
| New Share issues, May | 220,400,000 | 11,536,247 |
| Acquisition subsidiary, IKAS group May | 49,033,589 | 2,566,532 |
| Acquisition subsidiary, CS Union June | 20,840,820 | 1,090,857 |
| New share issues, October | 71,723,893 | 3,754,195 |
| New share issues, November | 158,276,107 | 8,284,539 |
| New share issues, December | 50,000,000 | 2,617,116 |
| At 1 January 2017 | 1,226,488,769 | 64,197,268 |
| At 31 March 2017 | 1,226,488,769 | 64,197,268 |
| New share issues, May | 50,000,000 | 2,617,116 |
| At 30 June 2017 | 1,276,488,769 | 66,814,384 |
| New share issues, August | 75,600,000 | 3,957,000 |
| New share issues, September | 164,400,000 | 8,605,077 |
| At 31 December 2017 | 1,516,488,769 | 79,376,461 |
| At 31 March 2018 | 1,516,488,769 | 79,376,461 |
| Exercise of share options, April | 27,992,250 | 1,465,114 |
| New share issues, May | 1 | 0 |
| At 31 May 2018 | 1,544,481,020 | 80,841,575 |
| At 30 June after Reverse split 1:10 | 154,448,102 | 80,841,575 |
| At 30 September after Reverse split 1:10 | 154,448,102 | 80,841,575 |
| Name | Shareholding | % Share |
|---|---|---|
| GEVERAN TRADING CO Ltd | 24,558,613 | 15.90 % |
| VERDIPAPIRFONDET DNB | 10,303,065 | 6.67 % |
| TVENGE TORSTEIN | 7,000,000 | 4.53 % |
| FERD AS | 5,335,139 | 3.45 % |
| SONGA TRADING INC | 4,742,346 | 3.07 % |
| VERDIPAPIRFONDET ALFRED BERG GAMBAK | 3,555,376 | 2.30 % |
| VERDIPAPIRFONDET ALFRED BERG NORGE | 2,890,144 | 1.87 % |
| VERDIPAPIRFONDET DELPHI NORDEN | 2,514,978 | 1.63 % |
| GVEPSEBORG AS | 2,036,494 | 1.32 % |
| VPF NORDEA NORGE | 2,013,102 | 1.30 % |
| UBS AG | 1,966,051 | 1.27 % |
| ALPETTE AS | 1,661,643 | 1.08 % |
| VERDIPAPIRFONDET ALFRED BERG AKTIV | 1,655,103 | 1.07 % |
| NORDNET LIVSFORSIKRING | 1,565,076 | 1.01 % |
| RMB INTERNATIONAL FUND | 1,472,238 | 0.95 % |
| CITIBANK, N.A. | 1,281,188 | 0.83 % |
| ARCTIC FUNDS PLC | 1,270,554 | 0.82 % |
| VPF NORDEA KAPITAL | 1,214,748 | 0.79 % |
| MARTIN IBEAS DAVID | 1,166,725 | 0.76 % |
| LOPEZ SANCHEZ ANDRES | 1,166,725 | 0.76 % |
| KLOTIND AS | 1,076,259 | 0.70 % |
| TVENGE ØYSTEIN ERLING | 1,075,000 | 0.70 % |
| LATINO INVEST AS | 1,030,000 | 0.67 % |
| VPF NORDEA AVKASTNING | 1,027,387 | 0.67 % |
| ELENA AS | 894,000 | 0.58 % |
| JPMORGAN CHASE BANK | 893,823 | 0.58 % |
| VARDFJELL AS | 891,401 | 0.58 % |
| RANGNES ENDRE | 864,000 | 0.56 % |
| INTELCO CONCEPT AS | 850,000 | 0.55 % |
| NOMURA INTERNATIONAL | 775,377 | 0.50 % |
| Total 30 largest shareholders | 88,746,555 | 61.05 % |
| Other shareholders | 65,701,547 | 38.95 % |
| Total number of shares | 154,448,102 | 100.00 % |
| Total number of shareholders | 9,674 |
| % Share |
|---|
| 15.9 % |
| 1.1 % |
| 0.8 % |
| 0.8 % |
| 0.7 % |
| 0.6 % |
| 0.4 % |
| 0.4 % |
| 0.4 % |
| 0.2 % |
| 0.1 % |
| 0.1 % |
| 0.1 % |
| 0.0 % |
| 0.0 % |
| 0.0 % |
| 0.0 % |
| 0.0 % |
| 0.0 % |
1) Geveran Trading Co Ltd owns 50% of Luxco Invest1 S.A and Reolux Holding S.à.r.l., companies controlled by Axactor Group.
2) CEO/Related to the CEO of Axactor SE.
3) Member of the executive management team of Axactor SE and former owner of ALD, Spain.
4) Related to the CFO of Axactor SE.
5) Banca Sistema S.P.A. owns 10% of the shares in Axactor Italy Srl, a company controlled by Axactor Group.
6) Member of the executive management team of Axactor SE.
7) Member of the Board of Directors of Axactor SE/controlleed by member of the Board of Directors of Axactor SE.
8) Primary insider of Axactor SE.
9) Company controlled by primary insider of Axactor SE.
10) Financing party.
As from 31 May 2018 the shares in Axactor SE are traded ex reverse split, with the new ISIN and new face value. Ratio: Ten old shares give one new share. New ISIN: SE0011309319. New Face value: EUR 0.5234232.
| EUR thousand | Currency | Interest rate | Carrying amount | Year of maturity |
|---|---|---|---|---|
| Balance at 1 January 2018 | EUR / NOK 1) 3) | Variable | 298,760 | 2017-2022 |
| New issues | ||||
| Italian Banks 2) | EUR | 23,885 | 2018-2022 | |
| DnB/Nordea | EUR | 73,898 | 2020 | |
| Listed Bond Loan 4) | EUR | 150,000 | 2021 | |
| Nomura 5) | EUR | 88,275 | 2021 | |
| Repayments | ||||
| Italian Banks | EUR | -27,309 | ||
| DnB/Nordea | EUR | -47,000 | ||
| Other | EUR | -80,000 | ||
| Other movements | ||||
| Capitalized loan fees | -5,031 | |||
| Amortized loan fees on loans | 2,648 | |||
| Currency translations | -721 | |||
| Balance at 30 Sept 2018 | 477,405 |
1) The debt facility agreement with DNB Bank ASA and Nordea Bank AB is EUR 350 million, whereof 150 million are in the form of accordion options. The facility has final maturity three years after signing. The loan carries a variable interest rate based on the interbank rate in each currency with a margin.
Under the terms of this debt facility the group is required to comply with the following financial covenants: the Group NIBD Ratio < 3; the Portfolio Leverage Ratio < 60 % and Collection performance > 90 %.
All material subsidiaries of the group are guarantors and have granted a share pledge and bank account pledge as part of the security package for this facility. Italian subsidiaries together with the co-invest vehicle in Luxembourg as well as the REO Holding company In Luxembourg are not a part of the agreement nor the security arrangement.
2) The facilities of the Italian banks relate to eleven different facilities and agreements with several Italian banks. Banca Sistema (which has a minority share of 10 % in the Italian subsidiary) is providing one of these facilities, and has granted a facility of EUR 29.5 million to finance further acquisitions of portfolios. The loan carries a variable interest rate based on the interbank rate with a margin. Some of the loans are secured with collaterals worth EUR 24 million.
| 3PC | Third Party Collection |
|---|---|
| ARM | Accounts Receivable Management |
| B2B | Business to Business |
| B2C | Business to Consumer |
| BoD | Board of Directors |
| CGU | Cash Generating Unit |
| CM1 | Contribution Margin |
| Dopex | Direct Operating expenses |
| ERC | Estimated Remaining Collection |
| EPS | Earnings Per Share |
| EUR | Euro |
| FTE | Full Time Equivalent |
| IFRS | International Financial Reporting Standards |
| NOK | Norwegian Krone |
| NPL | Non-Performing Loan |
| OB | Outstanding Balance |
| PCI | Purchased Credit Impaired |
| PPA | Purchase price allocations |
| REO | Real Estate Owned |
| SEK | Swedish Krone |
| SG&A | Selling, General & Administrative Expenses |
| SPV | Special Purpose Vehicle |
| VIU | Value in Use |
| WAEP | Weighted average exercise price |
| Yield | The effective interest rate on portfolios |
| CU1 | Catch up 1. Over- or underperformance compared to collection forecast |
| CU2 | Catch up 2. Revaluations and net present value of changes in forecast |
| CU2 tail | Catch up 2 tail. The net present value effect of rolling 180 months forecast |
| Quarterly Report - Q3 | 30.10.2018 |
|---|---|
| Quarterly Report - Q4 | 13.02.2019 |
Annual General meeting 09.04.2019
The company's annual report will be available on the company's website.
Contact details
Axactor SE (publ) Norra Hamngatan 18 411 06 Göteborg Sweden
Telephone: +46 8 402 28 00 [email protected] www.axactor.com
The shares of Axactor SE (publ.) are listed on the Oslo Stock Exchange, ticker AXA.
Cautionary Statement: Statements and assumptions made in this document with respect to Axactor SE's ("Axactor") current plans, estimates, strategies and beliefs, and other statements that are not historical facts, are forward-looking statements about the future performance of Axactor. Forward-looking statements include, but are not limited to, those using words such as "may", "might", "seeks", "expects", "anticipates", "estimates", "believes", "projects", "plans", strategy", "forecast" and similar expressions. These statements reflect management's expectations and assumptions in light of currently available information. They are subject to a number of risks and uncertainties, including, but not limited to, (i) changes in the economic, regulatory and political environments in the countries where Axactor operates; (ii) changes relating to the statistic information available in respect of the various debt collection projects undertaken; (iii) Axactor's continued ability to secure enough financing to carry on its operations as a going concern; (iv) the success of its potential partners, ventures and alliances, if any; (v) currency exchange rate fluctuations between the euro and the currencies in other countries where Axactor or its subsidiaries operate. In the light of the risks and uncertainties involved in the debt collection business, the actual results could differ materially from those presented and forecast in this document. Axactor assumes no unconditional obligation to immediately update any such statements and/or forecasts.
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