Intrum — Interim / Quarterly Report 2022

Apr 29, 2022

Interim report First quarter, 2022

First quarter, 2022

• Continued strong delivery in seasonally softer first quarter
• No direct impact from the war in Ukraine
• Current macro challenges expected to further drive demand for Intrum services
• All segments positively contributing to 10 per cent cash reve nues growth compared to first quarter 2021
• Continued improvement of new inflows in Credit Management Services
• Strong performance in Strategic Markets and Portfolio Investments
• In the first quarter cash EBIT increased to SEK 1,409 M (1,365), cash RoIC decreased to 7.7 per cent (7.8) and cash earnings per share (cash EPS) decreased to SEK 4.58 (5.68)
• Cash EBIT for Credit Management Services decreased to SEK 314 M (396) and the adjusted operating margin decreased to 18 per cent (22). The segment cash RoIC for the quarter was 6.6 per cent (8.4)
• Cash EBIT for Strategic Markets increased to SEK 728 M (645) and the adjusted operating margin increased to 32 per cent (31). The segment cash RoIC for the quarter was 19.8 per cent (16.4)
• Cash EBIT for Portfolio Investments increased to SEK 942 M (830), cash RoIC was 9.6 per cent (9.6) and total portfolio investments for the quarter amounted to SEK 1,784 M (1,739)

				Rolling
	First quarter			12 months	Full year
	Jan–Mar	Jan–Mar	Change
SEK M, unless otherwise indicated	2022	2021	%	2022	2021
Revenues	4,478	4,200	7	18,067	17,789
Adjusted revenues	4,471	4,198	7	17,929	17,656
Operating earnings (EBIT)	1,323	1,531	-14	6,267	6,475
Adjusted operating earnings (EBIT)	1,471	1,532	-4	6,952	7,014
Earnings per share, SEK	4.57	6.06	-25	24.40	25.88
Adjusted earnings per share, SEK	5.34	6.06	-12	28.14	28.86
Cash EBITDA	3,035	2,712	12	12,633	12,310
Cash EBIT	1,409	1,365	3	6,387	6,343
Cash EPS, SEK	4.58	5.68	-19	27.89	28.98
Cash RoIC, %	7.7	7.8	-0.1 ppt	8.9	8.9
Net debt/RTM cash EBITDA, x				3.8	3.9
Cash EBIT: Credit Management Services	314	396	-21	1,558	1,640
Cash EBIT: Strategic Markets	728	645	13	3,092	3,009
Cash EBIT: Portfolio Investments	942	830	13	3,674	3,561
Total portfolio investments made	1,784	1,739	3	8,151	8,106
Carrying value of portfolio investments	39,113	35,104	12	39,113	38,231
Adjusted return on portfolio investments, (ROI), %	13	14	-1.1 ppt	14	14

Comment by the President and CEO Strong delivery in seasonally slower quarter

During the first quarter we continued to deliver on our two strategic objectives – transformation and organic growth. Despite a seasonally slower quarter, I am very pleased with the continued strong organic growth, resulting in 10 per cent increase in cash revenues and 12 per cent increase in cash EBITDA compared to the same period last year. The strong cash flow generation contributed to reducing our leverage ratio to 3.8 times. I am also satisfied to see that all three segments positively contributed to cash revenues growth and, in particular, that our servicing segments are now on an accelerating growth trajectory. We see a high and increasing level of business activity across all segments and across all markets, which supports our organic growth ambition going forward.

At the same time, we are witnessing the most serious humanitarian crisis in decades – the war in Ukraine. Alongside many others, Intrum has donated towards UNHCR's refugee relief efforts. While Intrum does not have any business or operations in Ukraine or Russia, and the direct business consequences for Intrum are immaterial, the economic impact on the European economy may indirectly affect our business.

This war represents the second significant exogenous shock to the European economy in two years, with immediate consequences such as a spike in inflation driven by high energy and food costs. Combined with lingering pandemic effects on supply chains, this has caused the outlook for the European economy to deteriorate and interest rates to rise. As consumer affordability is being eroded, combined with increased credit utilisation, we see our clients preparing for increased late payment volumes.

A new macro climate will drive demand for Intrum services

In March 2022 the EU Economic Sentiment Indicator dropped substantially, mainly driven by sharply lowered consumer confidence. At the same time, the ECB's Bank Lending Survey indicates a significant increase in demand for consumer credit. Looking at household savings, Eurostat data shows that the savings ratio has reverted to close to pre-pandemic levels. At the same time the household investment rate has significantly increased. Overall a higher cost of living, combined with decreasing pandemic buffers, has resulted in a growing utilisation of credit.

While this is not yet visible in bank's non-performing loan ratios, currently at 2 per cent, Stage 2 loans now stand at just over 9 per cent, and increasing. Furthermore, the European Banking Authority indicates that, given prevailing uncertainties, banks should be prepared to cope with asset quality deterioration – with the associated increasing demand for our services.

ONE Intrum transformation remains fully on track

The ONE Intrum transformation continued at full speed in the first quarter. I am very proud with the progress across all initiatives, particularly our ability to continuously increase volumes benefitting from our global footprint. Our global front offices are now serving 16 Intrum markets and 17 per cent of all calls. The new global operating platform is our largest collection system with 8 million cases, equaling 20 per cent of all cases. We have now also successfully completed our first migration of secured cases in Greece. Additionally, we recently migrated our first cases from Sweden with five more countries expected to migrate volumes to the platform during this year.

I am very excited about the potential to apply advanced analytics and automation technology to our core operating processes and systems. We remain on track to deliver SEK 1 billion of recurring benefits by end of 2023 and can already now see how our technology roadmap can bring substantial further benefits and savings above our stated targets as we continue into 2024 and beyond.

Steady progress in Credit Management Services

During the quarter Credit Management Services saw continued improvement in business conditions. We observed increasing new case inflows, with utilities claims significantly up compared to the same period last year. Commercially, the first quarter was very strong with new sales exceeding our ambitious target. This includes the signing of Sainsbury's Bank in the UK and other sizeable new deals across multiple geographies in addition to a large number of important renewals with existing clients.

Cash revenues increased by 2 percent to SEK 1,054 million compared to the same quarter last year. Operating expenses increased "We see a high and increasing level of business activity across all three segments and across all markets which supports our organic growth ambition going forward. "

compared to the same quarter last year due to the FX development as well as other external spend which will start generating incremental revenues during the coming quarters. Underlying cost trajectory is on track as evidenced by the significant improvement in our FTE cost-to-collect ratio of 0.8 ppt compared to the first quarter of 2021.

Strategic Markets on solid growth trajectory

While the first quarter was seasonally slower, following a very strong finish to 2021, Italy, Greece and Spain continued to deliver strong underlying performance. Furthermore, we continued to see a strong improvement in the earnings quality as significant transactional revenues in the first quarter last year were replaced by asset based recurring revenues this quarter. In Italy, our franchise has made significant progress and is now on track to deliver market-leading performance across all asset classes. This is also reflected in increased client activity, including capturing new and extending existing mandates from flagship international investors such as SPF Investment Management and CRC. 60 per cent of our Italian assets under management now relate to parties other than our partner Intesa Sanpaolo.

In Spain, the impact from the loss of the contract with Sareb will negatively impact revenues later this year. However, it will be immaterial from a profit point of view, thus improving margins. The positive growth we are currently experiencing in Spain will continue to support the profit generation in the segment. Cash revenues came in 5 per cent above the first quarter of 2021 at SEK 1,418 million, with the continued margin improvement demonstrating the scalability of our platform.

Portfolio Investments continue to perform strongly

Our highly diversified book continues to generate attractive returns with minimal volatility.

In the first quarter the collection performance was 110 per cent relative to the active forecast, with a cash return on invested capital of 9.6 per cent. During the quarter we collected SEK 3,145 million, up 15 per cent compared to the same quarter last year. We also invested SEK 1,784 million at fairly stable expected return levels. Cash EBITDA for the segment was SEK 2,486 million, up 19 per cent compared to the first quarter 2021. Performance and deployment are in line with the expected contribution from Portfolio Investments towards selffunded organic growth as well as financial targets.

Continued progress in our sustainability efforts

Sustainability remains an important priority at Intrum and it is very pleasing to see that we are making good progress in relation to our targets. For the third year in a row, we have managed to reduce our greenhouse gas emissions. Intrum's client satisfaction index as well as employee engagement index have improved from 75 to 77 and from 79 to 80 in comparison to 2020, both at historically high levels. The female representation in the Board of Directors has also improved and we continue to focus on diversity and inclusion. Further details can be found in our recently published Annual & Sustainability Report for 2021. During the first quarter, we also developed a new Global Sustainability Policy to further clarify the governance, responsibilities and expectations throughout the business and in relation to key stakeholders.

Organic growth delivery and realising transformation benefits

I am excited to see the organic growth we are delivering with continued improvement in Credit Management Services, strong momentum in Strategic Markets, and continued outstanding execution in Portfolio Investments. Approaching the halfway point of our ONE Intrum transformation, our vision is now starting to translate into visible long-term benefits for our clients, our customers, and our employees. We will deliver SEK 1 billion of recurring savings by the end of 2023, with even more potential in the years beyond, based on a foundation of being simple, scalable, digital, relevant, and growing.

Looking at the near term, as we are entering the seasonally strong second quarter, our servicing segments are expected to demonstrate continued acceleration in their growth trajectories. Credit Management Services in particular is expected to benefit from continued growth in new-case inflows, conversion of already signed contracts as well as the generally increasing demand for our services. In Portfolio Investments we see a growing supply of portfolios, supporting our ability to select attractive investment opportunities across our wide local origination network, while upholding strict pricing discipline. The back book performance is expected to remain strong, despite the macro challenges, supported by sustainably sized granular payment plans.

I expect performance for 2022 in line with financial targets – cash EPS growth of 10 per cent or above and a leverage ratio at or below 3.5 times. My two key priorities for the coming quarters remain: delivering on ONE Intrum and organic growth.

Stockholm, April 2022

Anders Engdahl President & CEO "I am very excited about the potential to apply advanced analytics and automation technology to our core operating processes and systems."

Group overview

Development during the first quarter

Revenues and operating earnings

Total revenues for the quarter increased 7 per cent to SEK 4,478 M (4,200), with organic growth accounting for 2 per cent, revaluations for less than 1 per cent and currency effects for 4 per cent compared to the first quarter of the preceding year. The share of revenues denominated in EUR amounted to 66 per cent (63).

Operating earnings (EBIT) for the quarter amounted to SEK 1,323 M (1,531), with items affecting comparability of SEK -148 M (-1). The adjusted operating earnings, excluding items affecting comparability, decreased to SEK 1,471 M (1,532).

Items affecting comparability

Operating earnings for the quarter included items affecting comparability of SEK -148 M (-1). Portfolio revaluations amounted to SEK 7 M, items affecting comparability attributable to joint ventures to SEK -0 M, items affecting comparability depreciation and amortisations to SEK -22 M, transformation program to SEK -122 M and other items affecting comparability to SEK -11 M.

Net financial items

Net financial items for the quarter amounted to SEK -525 M (-516). Net interest amounted to SEK -474 M (-439), interest cost on leasing liabilites to SEK -9 M (-9), exchange rate differences to SEK 2 M (2) and other financial items to SEK -44 M (-70).

Earnings for the period and taxes

The tax expense for the quarter was SEK 175 M, representing 22 per cent of earnings before tax. The Group's assessment is that the tax expense will, over the next few years, be around 20–25 per cent of earnings before tax for each year, excluding the outcome of any tax disputes.

Net earnings for the quarter amounted to SEK 622 M (787), corresponding to earnings per share of SEK 4.57 (6.06) before dilution and SEK 4.58 (6.06) after dilution.

Cash flow and investments

Cash revenues increased to SEK 5,792 M (5,249). Cash EBITDA and cash EBIT increased to SEK 3,035 M (2,712) and SEK 1,409 M (1,365), respectively. Cash EPS for the quarter amounted to SEK 4.58 per share (5.68). This corresponds to a cash return on invested capital (cash RoIC) of 7.7 per cent (7.8) for the quarter.

Assets and financing

Total assets at the end of the quarter amounted to SEK 90,027 M, compared to SEK 83,189 M at the end of the first quarter of the preceding year. Net debt amounted to SEK 47,806 M (47,367), the share of fixed rate debt amounts to 75 per cent of net debt and is principally composed of EUR bonds with maturities between 2024 and 2027. Net debt in relation to the RTM cash EBITDA stands at 3.8x compared to 4.1x at the end of the first quarter 2021. By the end of the first quarter, Intrum had SEK 3,365 M (3,166) outstanding commercial paper, the increase reflects a more positive short term credit sentiment and the proceeds have been used to repay drawings under the revolving credit facility. At the end of the quarter SEK 4,316 M (1,667) of Intrum's revolving credit facility was utilised.

Cash revenues, SEK M Cash revenues rolling 12 months, SEK M

Cash EBIT, SEK M Cash EBIT rolling 12 months, SEK M

Cash RoIC, % Cash RoIC rolling 12 months, %

Net Debt/RTM cash EBITDA

Segment overview

Credit Management Services, Strategic Markets and Portfolio Investments

Key figures, Q1 2022

	Credit Management	Strategic	Portfolio	Group
SEK M	Services	Markets	Investments	items	Group
Cash revenues	1,054	1,418	3,320	–	5,792
Reported segment earnings	264	427	1,293	-660	1,323
Items affecting comparability	12	55	-3	84	148
Adjusted segment earnings	276	482	1,290	-576	1,471
Depreciation and amortisation	47	248	2	93	390
EBITDA	311	675	1,295	-568	1,713
Portfolio amortisation	–	–	1,233	–	1,233
Adjustment earnings from joint ventures	–	–	-126	–	-126
Adjustment cash flow from joint ventures	–	–	88	–	88
Items affecting comparability	12	64	-3	53	127
Cash EBITDA	324	739	2,487	-515	3,035
Replenishment capex	–	–	-1,545	–	-1,545
Other capex	-9	-11	–	-60	-81
Cash EBIT	314	728	942	-575	1,409
Cash financial items					-640
Cash tax normalised					-215
Recurring consolidated cash earnings					554
Average number of shares outstanding					121
Cash EPS, SEK					4.58
Average invested capital	19,078	14,719	39,289	213	73,299
Cash RoIC, %	6.6	19.8	9.6	–	7.7
Revenues	1,574	1,517	2,006	-619	4,478
Items affecting comparability	–	–	-7	–	-7
Adjusted revenues	1,574	1,517	1,999	-619	4,471
Reported segment earnings	264	427	1,293	-660	1,323
Depreciation and amortisation	47	248	2	93	390
Items affecting comparability	12	64	-3	53	127
Adjusted EBITDA	324	739	1,292	-515	1,839
Adjusted depreciation and amortisation	-48	-257	-2	-61	-368
Adjusted segment earnings	276	482	1,290	-576	1,471

Credit Management Services, Strategic Markets and Portfolio Investments, cont.

Key figures, Q1 2021

	Credit Management	Strategic	Portfolio	Group
SEK M	Services	Markets	Investments	items	Group
Cash revenues	1,038	1,346	2,864	–	5,249
Reported segment earnings	352	439	1,231	-491	1,531
Items affecting comparability	-2	–	3	–	1
Adjusted segment earnings	350	439	1,234	-491	1,532
Depreciation and amortisation	62	218	2	44	326
EBITDA	414	657	1,233	-446	1,858
Portfolio amortisation	–	–	1,007	–	1,007
Adjustment earnings from joint ventures	–	–	-196	–	-196
Adjustment cash flow from joint ventures	–	–	44	–	44
Items affecting comparability	-2	–	1	–	-1
Cash EBITDA	412	657	2,089	-446	2,712
Replenishment capex	–	–	-1,259	–	-1,259
Other capex	-16	-12	–	-60	-88
Cash EBIT	396	645	830	-506	1,365
Cash financial items					-599
Cash tax normalised					-79
Recurring consolidated cash earnings					687
Average number of shares outstanding					121
Cash EPS, SEK					5.68
Average invested capital	18,970	15,699	34,673	236	69,578
Cash RoIC, %	8.4	16.4	9.6	–	7.8
Revenues	1,585	1,434	1,816	-634	4,200
Items affecting comparability	–	–	-2	–	-2
Adjusted revenues	1,585	1,434	1,814	-634	4,198
Reported segment earnings	352	439	1,231	-491	1,531
Depreciation and amortisation	62	218	2	44	326
Items affecting comparability	-2	–	3	–	1
Adjusted EBITDA	412	657	1,236	-446	1,859
Adjusted depreciation and amortisation	-62	-218	-2	-44	-326
Adjusted segment earnings	350	439	1,234	-491	1,532

Credit Management Services

Credit management with a focus on late payments and collections. This segment includes 21 of the 24 European countries in which Intrum maintains credit management operations.

		First quarter
	Jan–Mar	Jan–Mar	Change
SEK M	2022	2021	%	2021
Cash revenues	1,054	1,038	2	4,102
Cash EBITDA	324	412	-21	1,701
Other capex	-9	-16	-39	-61
Cash EBIT	314	396	-21	1,640
External revenues	1,054	1,038	2	4,102
Internal revenues	520	546	-5	2,197
Total revenues	1,574	1,585	-1	6,299
Items affecting comparability	–	–	–	–
Adjusted revenues	1,574	1,585	-1	6,299
Segment earnings	264	352	-25	1,430
Items affecting comparability	12	-2	-712	17
Adjusted segment earnings	276	350	-21	1,447
KPI's
Average invested capital	19,078	18,970	1	19,103
Segment cash RoIC, %	6.6	8.4	-1.8 ppt	8.6
Cash revenues change, %	2	-9		-6
– thereof organic change, %	-3	-5		-4
– thereof exchange rates, %	5	-4		-2
– thereof acquired growth, %	–	–		–
Operating margin, %	17	22	-5.5 ppt	23
Adjusted operating margin, %	18	22	-4.6 ppt	23

During the quarter Credit Management Services saw continued improvement in new case inflows with utilities claims significantly up compared to the same period last year. Commercially, the first quarter was very strong with sales exceeding our ambitious target. This includes the signing of Sainsbury's Bank in the UK and other sizeable new deals across multiple geographies in addition to a large number of important renewals with existing clients. The segment's cash revenues increased by 2 per cent and cash EBIT decreased by 21 per cent compared to the first quarter of the preceding year. Operating expenses increased compared to the same quarter last year due to the FX development as well as other external spend which will start generating incremental revenues during the coming quarters. Underlying cost trajectory is on track as evidenced by the significant improvement in our FTE cost-tocollect ratio of 0.8 ppt compared to the first quarter of 2021. Cash return on invested capital was 6.6 per cent (8.4) for the quarter.

Credit Management Services, adjusted operating margin, % and segment cash RoIC, %

Credit Management Services, Cash EBIT, SEK M Cash EBIT rolling 12 months, SEK M

Strategic Markets

Credit management focusing on late payments and collections in Greece, Italy and Spain.

		First quarter	Full year
	Jan–Mar	Jan–Mar	Change
SEK M	2022	2021	%	2021
Cash revenues	1,418	1,346	5	5,624
Cash EBITDA	739	657	12	3,080
Other capex	-11	-12	-8	-72
Cash EBIT	728	645	13	3,009
External revenues	1,418	1,346	5	5,624
Internal revenues	99	88	13	387
Total revenues	1,517	1,434	6	6,011
Items affecting comparability	–	–	–	–
Adjusted revenues	1,517	1,434	6	6,011
Segment earnings	427	439	-3	1,974
Items affecting comparability	55	–	n.m.	251
Adjusted segment earnings	482	439	10	2,225
KPI's
Average invested capital	14,719	15,699	-6	15,504
Segment cash RoIC, %	19.8	16.4	3.4 ppt	19.4
Cash revenues change, %	5	21		4
– thereof organic change, %	1	28		8
– thereof exchange rates, %	4	-7		-4
– thereof acquired growth, %	–	–		–
Operating margin, %	28	31	-2.5 ppt	33
Adjusted operating margin, %	32	31	1.2 ppt	37

Following a very strong finish to 2021 the first quarter of 2022 was seasonally slower. The Strategic Markets continue to deliver strong underlying performance with a significant positive contribution from all three markets. In Italy our franchise has made significant progress and is now on track to deliver market-leading performance across all asset classes. This is reflected in increased client activity and wins, including capturing new and extending existing mandates from flagship international investors such as SPF Investment Management and CRC. 60 per cent of our assets under management now relate to parties other than our partner Intesa Sanpaolo.

In Spain, the impact from the loss of the contract with Sareb will negatively impact revenues later this year. However, it will be immaterial from a profit point of view thus improving margins. Cash revenues for the segment increased by 5 per cent compared to the first quarter of 2021 while cash EBITDA and cash EBIT increased by 12 and 13 per cent, respectively. Cash RoIC amounted to 19.8 per cent (16.4) for the quarter.

Strategic Markets, Cash EBIT, SEK M Cash EBIT rolling 12 months, SEK M

Portfolio Investments

Intrum invests in portfolios of overdue receivables and similar claims, after which Intrum's servicing operations collect on the claims acquired.

	First quarter 2022				First quarter 2021
	Overdue		Financial	Joint	Segment	Overdue		Financial	Joint	Segment
SEK M	receivables	REO	services	ventures	total	receivables	REO	services	ventures	total
Cash revenues	3,135	49	49	88	3,320	2,742	34	45	44	2,864
Cash EBITDA	2,369	4	26	88	2,486	2,019	1	25	44	2,089
Replenishment capex	-1,545	–	–	–	-1,545	-1,259	–	–	–	-1,259
Cash EBIT	824	4	26	88	942	760	1	25	44	830
Total revenues	1,909	49	49	–	2,006	1,737	34	45	–	1,816
Items affecting comparability	-7	–	–	–	-7	-2	–	–	–	-2
Adjusted segment revenues	1,902	49	49	–	1,999	1,735	34	45	–	1,814
Segment earnings	1,142	1	24	125	1,293	1,013	-3	25	196	1,231
Items affecting comparability	-7	2	2	0	-3	-2	3	–	2	3
Adjusted segment earnings	1,135	3	26	126	1,290	1,011	0	25	198	1,234
KPI's
Average invested capital	31,870	323	618	6,479	39,289	28,321	388	468	5,496	34,673
Segment cash RoIC, %	10.3	5.1	16.8	5.4	9.6	10.7	1.2	21.7	3.2	9.6
Total portfolio investments made	1,689	95	–	–	1,784	1,503	37	–	200	1,739
Money-on-money multiple (RTM)	2.04	–	–	–	2.04	2.18	–	–	–	2.18
Book value	32,262	331	–	6,520	39,113	28,984	394	–	5,726	35,104
ERC	66,643	412	–	9,037	76,092	60,956	429	–	6,878	68,263
Cost to collect, paid %	24	97	–	–	25	26	108	–	–	27
Amortisation ratio, %	39	–	–	–	39	37	–	–	–	37
Operating margin, %	60	3	50	–	64	58	-8	55	–	68
Adjusted operating margin, %	60	7	52	–	64	58	2	55	–	68
Return on portfolio	14	2	–	8	13	14	-3	–	14	14
investments, ROI, %
Adjusted return on portfolio investments, ROI, %	14	4	–	8	13	14	1	–	14	14

Portfolio Investments, Adjusted return, %, Cash RoIC, %

Portfolio Investments, Cash EBIT, SEK M Cash EBIT rolling 12 months, SEK M

In the first quarter the collection performance was 110 per cent relative to the active forecast, with a cash return on invested capital of 9.6 per cent. During the quarter we collected SEK 3,145 M, up 15 per cent compared to the same quarter last year. We also invested SEK 1,784 M at fairly stable expected return levels. Cash EBITDA for the segment was SEK 2,486 M, up 19 per cent compared to the first quarter 2021. Our highly diversified book continues to generate attractive returns with minimal volatility and is a significant contributor to our increasing cash EBITDA trajectory. Performance and deployment are in line with the expected contribution from Portfolio Investments towards organic growth as well as financial targets.

Financial overview

Alternative P&L, Adjusted Group figures

		First quarter		Full year
	Jan–Mar	Jan–Mar	Change
SEK M	2022	2021	%	2021
External revenues	2,559	2,465	4	10,148
Gross cash collections	3,145	2,740	15	11,818
Cash flow from joint ventures	88	44	102	248
Cash revenues	5,792	5,249	10	22,215
Cash EBITDA	3,035	2,712	12	12,310
Replenishment capex	-1,545	-1,259	23	-5,654
Other capex	-81	-88	-8	-314
Cash EBIT	1,409	1,365	3	6,343
Cash financial items	-640	-599	7	-2,013
Cash tax normalised	-215	-79	171	-828
Recurring consolidated cash earnings	554	687	-19	3,502
Average number of shares outstanding	121	121	0	121
Cash EPS, SEK	4.58	5.68	-19	28.98
Cashflow from operating activities to cash EBITDA
Operating cash flow	1,969	1,798	10	10,042
Cash financial items	640	599	7	2,013
Paid tax	215	211	2	893
Change in working capital (NWC)	6	59	-90	-1,057
Other non-cash items	110	196	-44	262
Adjustment earnings from joint ventures	-126	-196	-36	-293
Adjustment cash flow from joint ventures	88	44	102	248
Items affecting comparability excluding impairment	134	1	n.m.	202
Cash EBITDA	3,035	2,712	12	12,310
Adjusted Depreciation and amortisation	-368	-326	13	-1,319
Portfolio amortisations	-1,233	-1,007	22	-4,311
Adjustment earnings from joint ventures	126	196	-36	293
Adjustment cash flow from joint ventures	-88	-44	102	-248
Items affecting comparability joint ventures	0	2	-83	288
Adjusted EBIT	1,471	1,532	-4	7,014

Alternative P&L, Adjusted Group figures

	First quarter 2022
	Credit
	Management	Strategic	Portfolio
SEK M	Services	Markets		Investments Group items	Group
External revenues	1,054	1,418	87	–	2,559
Gross cash collections	–	–	3,145	–	3,145
Cash flow from joint ventures	–	–	88	–	88
Cash revenues	1,054	1,418	3,320	–	5,792
Cash EBITDA	324	739	2,486	-515	3,035
Adjusted Depreciation and amortisation	-48	-257	-2	-61	-368
Portfolio amortisations	–	–	-1,233	–	-1,233
Adjustment earnings from joint ventures	–	–	126	–	126
Adjustment cash flow from joint ventures	–	–	-88	–	-88
Items affecting comparability joint ventures	–	–	-0	–	-0
Adjusted segment earnings	276	482	1,290	-576	1,471
Cash EBITDA margin, %	31	52	75	–	52

Financial overview, cont.

Revenues by type

		Full year
	Jan–Mar	Jan–Mar	Change
SEK M	2022	2021	%	2021
External servicing revenues	2,472	2,385	4	9,726
Gross cash collections	3,145	2,740	15	11,818
Other Portfolio Investments segment	87	80	9	423
revenues
Cash flow from joint ventures	88	44	102	248
Cash revenues	5,792	5,249	10	22,215
Portfolio amortisation	-1,233	-1,007	22	-4,311
Portfolio revaluations	7	2	221	133
Adjustment cash flow from joint ventures	-88	-44	102	-248
Total revenues	4,478	4,200	7	17,789

Change in revenues

	First quarter	Full year
	Jan–Mar	Jan–Mar
Change in revenues, %	2022	2021	2021
Organic growth	2	14	8
Acquired growth	–	–	–
Portfolio revaluations	0	19	1
Exchange rates	4	-7	-3
Total	7	26	6

Items affecting comparability in operating earnings

	First quarter	Full year
	Jan–Mar	Jan–Mar
SEK M	2022	2021	2021
Positive revaluations of portfolio investments	254	317	1,789
Negative revaluations of portfolio investments	-247	-315	-1,656
Items affecting comparability joint ventures	-0	-2	-288
Items affecting comparability depreciation and amortisations	-22	–	-179
Transformation program	-122	–	-73
Other items affecting comparability	-11	-1	-132
Total items affecting comparability	-148	-1	-538
in operating earnings

Net financial items specification

		Full year
	Jan–Mar	Jan–Mar	Change
SEK M	2022	2021	%	2021
Interest earnings	12	4	200	22
Interest costs	-486	-443	10	-1,832
Interest cost on leasing liability according to IFRS 16	-9	-9	0	-37
Exchange rate differences	2	2	0	-11
Amortisation of borrowing costs	-25	-25	0	-103
Commitment fee	-38	-39	-3	-153
Other financial items	19	-6	-417	-60
Total net financial items	-525	-516	2	-2,174

Quarterly overview

Group

	Quarter 1	Quarter 4	Quarter 3	Quarter 2	Quarter 1	Quarter 4	Quarter 3	Quarter 2
SEK M	2022	2021	2021	2021	2021	2020	2020	2020
Cash revenues	5,792	6,053	5,322	5,591	5,249	5,601	5,549	4,977
Cash EBITDA	3,035	3,726	2,906	2,966	2,712	3,124	3,142	2,709
Cash EBIT	1,409	2,171	1,394	1,413	1,365	1,523	1,659	1,294
Cash EPS, SEK	4.58	13.93	3.68	5.67	5.68	9.00	5.88	7.98
Revenues	4,478	4,870	4,294	4,424	4,200	5,109	4,521	3,885
Adjusted revenues	4,471	4,853	4,183	4,422	4,198	4,359	4,520	3,882
Operating earnings (EBIT)	1,323	2,040	1,341	1,563	1,531	1,200	1,688	1,348
Adjusted EBIT	1,471	2,355	1,533	1,594	1,532	1,611	1,687	1,345
Net earnings	622	1,251	541	810	787	576	864	671
Earnings per share, SEK	4.57	8.98	4.33	6.48	6.06	3.40	6.97	5.39
Return on equity, %	10	20	11	16	15	8	16	13
Equity per share, SEK	188.25	183.38	168.72	162.54	171.12	158.05	166.15	159.46
Cash flow from operating activities per share, SEK	16.30	26.54	24.08	17.40	14.88	11.75	17.54	22.30
Average invested capital	73,299	72,224	71,405	70,971	69,578	70,057	71,565	73,555
Cash RoIC , %	7.7	12.0	7.8	8.0	7.8	8.7	9.3	7.0
Number of employees (FTEs)	9,750	9,664	9,733	9,786	9,626	9,458	9,446	9,366

Credit Management Services

	Quarter 1	Quarter 4	Quarter 3	Quarter 2	Quarter 1	Quarter 4	Quarter 3	Quarter 2
SEK M	2022	2021	2021	2021	2021	2020	2020	2020
Cash revenues	1,054	1,056	996	1,012	1,038	1,099	1,089	1,048
Cash EBIT	314	437	396	411	396	281	495	374
Revenues	1,574	1,602	1,541	1,572	1,585	1,664	1,647	1,590
– thereof external clients	1,054	1,056	996	1,012	1,038	1,099	1,089	1,048
– thereof intercompany	520	546	545	560	546	565	559	542
revenues
Adjusted revenues	1,574	1,602	1,541	1,572	1,585	1,664	1,647	1,590
Segment earnings	264	355	356	367	352	328	482	383
Adjusted segment earnings	276	374	356	367	350	328	482	383
Items affecting comparability	12	19	–	-1	–2	–	–	–
Adjusted operating margin, %	18	23	23	23	22	20	29	24
Average invested capital	19,078	19,089	19,174	19,176	18,970	19,093	19,302	19,681
Segment cash RoIC, %	6.6	9.2	8.3	8.6	8.4	5.9	10.3	7.6

Strategic Markets

	Quarter 1	Quarter 4	Quarter 3	Quarter 2	Quarter 1	Quarter 4	Quarter 3	Quarter 2
SEK M	2022	2021	2021	2021	2021	2020	2020	2020
Cash revenues	1,418	1,802	1,160	1,315	1,346	1,461	1,637	1,202
Cash EBIT	728	1,310	482	572	645	875	819	525
Revenues	1,517	1,903	1,257	1,416	1,434	1,558	1,738	1,265
– thereof external clients	1,418	1,802	1,160	1,315	1,346	1,461	1,637	1,202
– thereof intercompany	99	101	97	101	88	97	101	63
revenues
Adjusted revenues	1,517	1,903	1,257	1,416	1,434	1,558	1,738	1,265
Segment earnings	427	901	265	370	439	585	515	345
Adjusted segment earnings	482	1,142	271	373	439	691	515	345
Items affecting comparability	55	242	-6	-3	–	106	–	–
Adjusted operating margin, %	32	60	22	26	31	44	30	27
Average invested capital	14,719	15,118	15,526	15,674	15,699	16,126	16,582	17,487
Segment cash RoIC, %	19.8	34.7	12.4	14.6	16.4	21.7	19.8	12.0

Quarterly overview, cont.

Portfolio Investments

	Quarter 1	Quarter 4	Quarter 3	Quarter 2	Quarter 1	Quarter 4	Quarter 3	Quarter 2
SEK M	2022	2021	2021	2021	2021	2020	2020	2020
Cash revenues	3,320	3,195	3,166	3,265	2,864	3,041	2,823	2,727
Cash EBITDA	2,486	2,375	2,350	2,402	2,089	2,243	2,065	1,998
Cash EBIT	942	901	907	925	830	834	748	775
Gross cash collections	3,145	3,008	2,961	3,108	2,740	2,937	2,700	2,536
Portfolio amortisation	-1,233	-1,111	-1,072	-1,120	-1,007	-1,063	-972	–994
Portfolio revaluation	7	17	112	3	2	599	1	3
Other Portfolio Investments	87	98	138	107	80	76	66	90
segment revenues
Revenues	2,006	2,012	2,138	2,098	1,816	2,549	1,795	1,635
Segment earnings	1,293	1,312	1,198	1,303	1,231	751	1,094	1,006
Adjusted segment earnings	1,290	1,337	1,305	1,353	1,234	1,063	1,093	1,003
Portfolio investments	1,689	2,683	1,420	1,739	1,503	1,258	837	1,267
Total carrying value of portfolio investments	39,113	38,231	36,179	35,629	35,104	33,305	34,940	34,945
– thereof purchased receivables	32,262	31,478	29,840	29,300	28,984	27,658	27,966	28,032
– thereof joint ventures	6,520	6,438	6,013	5,983	5,726	5,266	6,557	6,507
– thereof real estate	331	315	326	347	394	381	416	406
Adjusted return on portfolio investments, ROI, %	13	14	14	15	14	12	12	11
Amortisation ratio, %	39	37	36	36	37	36	36	39
ERC	76,092	74,337	70,322	69,107	68,263	65,467	64,393	64,674
Replenishment capex	-1,545	-1,474	-1,443	-1,477	-1,259	-1,409	-1,317	-1,223
Money-on-money multiple (RTM)	2.04	2.04	2.05	2.10	2.18	2.08	2.05	2.07
Average invested capital	39,289	37,798	36,478	35,888	34,673	34,602	35,440	36,134
Segment cash RoIC ,%	9.6	9.5	9.9	10.3	9.6	9.6	8.4	8.6

Money-on-money multiple

	Quarter 1	Quarter 4	Quarter 3	Quarter 2	Quarter 1	Quarter 4	Quarter 3	Quarter 2
	2022	2021	2021	2021	2021	2020	2020	2020
Purchase price of portfolios acquired in quarter	1,675	2,133	1,445	1,680	1,443	1,256	837	1,267
ERC 180 months of portfolios	4,239	4,239	2,794	3,414	3,190	2,554	1,791	2,944
acquired in quarter
Quarterly MoM	2.19	1.99	1.93	2.03	2.21	2.03	2.14	2.32
RTM MoM (average of quarterly MoM)	2.04	2.04	2.05	2.10	2.18	2.08	2.05	2.07
In quarter collections	3,145	3,008	2,961	3,108	2,740	2,937	2,700	2,536
RTM MoM (average of quarterly MoM)	2.04	2.04	2.05	2.10	2.18	2.08	2.05	2.07
Replenishment capex	-1,545	-1,474	-1,443	-1,477	-1,259	-1,409	-1,317	-1,223
		Full year 2021				Full year 2020
Replenishment capex		-5,654				-5,355

Five year overview

Group
SEK M	2021	2020	2019	2018	2017
Revenues	17,789	16,848	15,985	13,442	9,434
Adjusted revenues	17,656	16,731	15,780	13,131	9,437
EBIT	6,475	4,695	2,060	3,978	2,728
Adjusted EBIT	7,014	5,738	6,208	4,500	3,128
Net earnings	3,391	2,078	–285	1,943	1,503
Earnings per share, SEK	25.88	15.18	–2.76	14.18	14.62
Return on equity, %	15	9	–2	8	11
Equity per share, SEK	183.33	154.28	168.12	195.16	170.59
Cash flow from operating activities per share, SEK	83.11	68.64	48.77	48.10	–
Average number of employees (FTEs)	9,694	9,379	8,766	7,910	6,293
Group
	Quarter 1	Quarter 1	Quarter 1	Quarter 1	Quarter 1
SEK M	2022	2021	2020	2019	2018
Revenues	4,478	4,200	3,333	3,752	3,115
Adjusted revenues	4,471	4,198	3,969	3,561	3,102
EBIT	1,323	1,531	459	1,347	897
Adjusted EBIT	1,471	1,532	1,095	1,350	973
Cash EBITDA	3,035	2,712	2,633	2,314	1,948
Net earnings	622	787	–33	739	364
Earnings per share, SEK	4.57	6.06	–0.25	5.63	2.77
Return on equity, %	10	15	–0	12	6
Equity per share, SEK	188.25	171.12	165.62	188.55	179.63
Cash flow from operating activities per share, SEK	16.30	14.88	17.37	10.30	11.01
Number of employees (FTEs)	9,750	9,626	9,188	8,133	8,318

Reconciliation of alternative performance measures

			Rolling
	First quarter		12 months	Full year
	Jan–Mar	Jan–Mar	Apr 2021–
SEK M	2022	2021	Mar 2022	2021
Items affecting comparability in revenues
Positive revaluations of portfolio investments	254	317	1,726	1,789
Negative revaluations of portfolio investments	-247	-315	-1,588	-1,656
Total items affecting comparability in revenues	7	2	138	133
Items affecting comparability in operating earnings
Positive revaluations of portfolio investments	254	317	1,726	1,789
Negative revaluations of portfolio investments	-247	-315	-1,588	-1,656
Items affecting comparability joint ventures	-0	-2	-286	-288
Items affecting comparability depreciation and amortisations	-22	–	-201	-179
Transformation program	-122	–	-195	-73
Other items affecting comparability	-11	-1	-142	-132
Total items affecting comparability in operating earnings	-148	-1	-685	-538
Items affecting comparability by earnings statement line
Positive revaluations of portfolio investments	254	317	1,726	1,789
Negative revaluations of portfolio investments	-247	-315	-1,588	-1,656
Cost of sales	-71	-1	-369	-299
Sales, marketing and administration costs	-84	–	-168	-84
Items affecting comparability joint ventures	-0	-2	-286	-288
Total items affecting comparability in operating earnings	-148	-1	-685	-538
Other items affecting comparability by segment
Credit Management Services	-13	2	-32	-17
Strategic Markets	-55	–	-306	-251
Portfolio Investments	4	-3	-178	-185
Common costs	-84	–	-169	-85
Total other items affecting comparability	-148	-1	-685	-538
Adjusted revenues
Revenues	4,478	4,200	18,067	17,789
Items affecting comparability	-7	-2	-138	-133
Adjusted revenues	4,471	4,198	17,929	17,656
Adjusted EBIT
EBIT	1,323	1,531	6,267	6,475
Items affecting comparability	148	1	685	538
Total adjusted EBIT	1,471	1,532	6,952	7,014

			Rolling
	First quarter		12 months	Full year
	Jan–Mar	Jan–Mar	Apr 2021–
SEK M	2022	2021	Mar 2022	2021
Adjusted earnings per share
Net earnings for the period attributable to parent company's shareholders	552	732	2,947	3,127
Items affecting comparability attributable to the parent company's shareholders adjusted for tax	93	1	453	361
Average number of outstanding shares	121	121	121	121
Adjusted earnings per share, SEK	5.34	6.06	28.14	28.86
Portfolio Investments segment earnings excluding items
affecting comparability
Portfolio Investments segment earnings	1,268	1,206	5,000	4,938
Items affecting comparability for investments	-3	3	179	185
Portfolio Investments segment earnings excluding items affecting comparability	1,265	1,209	5,179	5,122
Average carrying value
Average carrying value receivables	31,870	28,321	30,310	29,423
Average carrying value joint ventures	6,479	5,496	6,139	5,893
Average carrying value real estate	323	388	338	353
Total average carrying value	38,672	34,205	36,787	35,670
Return including items affecting comparability	13	14	14	14
Return excluding items affecting comparability	13	14	14	14
Cash EBITDA
EBIT	1,323	1,531	6,267	6,475
Depreciation and amortisation	390	326	1,564	1,500
Portfolio amortisation	1,233	1,007	4,536	4,310
Portfolio revaluations	-7	-2	-138	-133
Adjustments according to loan covenants:
Adjustment earnings from joint ventures	-126	-196	-223	-293
Adjustment cash flow from joint ventures	88	44	292	248
Items affecting comparability excluding portfolio revaluations	134	3	620	489
Items affecting comparability joint ventures	-0	-2	-286	-288
Cash EBITDA	3,035	2,712	12,633	12,310
Net debt
Liabilities to credit institutions	4,305	1,571	4,305	4,060
Bond loans	44,775	44,493	44,775	44,443
Provisions for pensions	344	389	344	329
Commercial paper	3,360	3,165	3,360	3,998
Cash and cash equivalents	-4,977	-2,252	-4,977	-4,553
Net debt at end of period	47,806	47,367	47,806	48,277
Net debt/RTM cash EBITDA			3.8	3.9

Financial report

Condensed consolidated income statement

		First quarter
	Jan–Mar	Jan–Mar	Full year
SEK M	2022	2021	2021
Revenues from clients	2,560	2,465	10,149
Revenues from portfolio investments calculated	1,912	1,733	7,507
using the effective interest method
Positive revaluations of portfolio investments	254	317	1,789
Negative revaluations of portfolio investments	-247	-315	-1,656
Total revenues	4,478	4,200	17,789
Cost of sales	-2,633	-2,365	-9,555
Gross earnings	1,845	1,836	8,233
Sales, marketing and administrative expenses	-648	-500	-2,051
Participation in associated companies and joint ventures	126	196	293
Operating earnings (EBIT)	1,323	1,531	6,475
Net financial items	-525	-516	-2,174
Profit before tax	797	1,015	4,301
Taxes	-175	-228	-910
Net earnings for the period	622	787	3,391
Of which attributable to:
Parent company's shareholders	553	732	3,127
Non-controlling interest	69	54	265
Net earnings for the period	622	787	3,391
Average no of shares before dilution, '000	120,821	120,871	120,828
Average no of shares after dilution, '000	120,857	120,871	120,830
Earnings per share before dilution
Profit from continuing operations, SEK	4.57	6.06	25.88
Total earnings per share before dilution, SEK	4.57	6.06	25.88
Total earnings per share after dilution, SEK	4.58	6.06	25.88

Condensed consolidated statement of comprehensive income

	First quarter	Full year
	Jan–Mar	Jan–Mar
SEK M	2022	2021	2021
Net earnings for the period	622	787	3,391
Other comprehensive earnings, items that
will be reclassified to profit and loss:
Currency translation difference	693	1,297	1,753
Comprehensive income for the year attributable to hedging of	-171	-425	-411
currency and other
Other comprehensive earnings, items that
will not be reclassified to profit and loss:
Remeasurement of pension liability	-4	–	51
Comprehensive income for the period	1,140	1,658	4,785
Of which attributable to:
Parent company's shareholders	1,047	1,565	4,446
Non-controlling interest	93	93	338
Comprehensive income for the period	1,140	1,658	4,785

Condensed consolidated balance sheet

	31 Mar	31 Mar	31 Dec
SEK M	2022	2021	2021
ASSETS
Intangible fixed assets
Goodwill	33,218	32,523	32,758
Capitalised expenditure for IT development	897	953	917
and other intangibles
Client relationships	3,964	4,855	4,136
Total intangible fixed assets	38,079	38,331	37,811
Tangible fixed assets
Right-of-use assets	714	799	756
Investment property	0	1	0
Other tangible fixed assets	212	213	218
Total tangible fixed assets	927	1,013	974
Other fixed assets
Shares in joint ventures	6,520	5,726	6,438
Portfolio investments	32,262	28,984	31,478
Deferred tax assets	1,717	1,335	1,748
Long-term interest-bearing receivables	10	–	10
Other long-term receivables	76	107	79
Total other fixed assets	40,586	36,151	39,754
Total fixed assets	79,591	75,495	78,539
Current assets
Accounts receivable	975	1,270	1,299
Inventory of real estate	331	394	315
Client funds	965	1,152	1,063
Tax assets	158	157	170
Other receivables	1,471	1,253	1,578
Prepaid expenses and accrued earnings	1,558	1,216	1,366
Cash and cash equivalents	4,977	2,252	4,553
Total current assets	10,436	7,694	10,334
TOTAL ASSETS	90,027		83,189 88,883

SEK M	31 Mar	31 Mar	31 Dec
SHAREHOLDERS' EQUITY AND	2022	2021	2021
LIABILITIES
Attributable to parent company's	22,744	20,241	21,698
shareholders
Attributable to non-controlling interest	3,083	3,008	2,989
Total shareholders' equity	25,826		23,249 24,687
Long-term liabilities
Liabilities to credit institutions	4,305	1,571	4,060
Bond loans	44,025	43,393	43,693
Long-term leasing liabilities	543	621	582
Other long-term liabilities	432	484	478
Provisions for pensions	344	389	329
Other long-term provisions	41	61	42
Deferred tax liabilities	1,087	1,113	1,103
Total long-term liabilities	50,777	47,633	50,288
Current liabilities
Bond loans	750	1,100	750
Commercial paper	3,360	3,165	3,998
Client funds payable	965	1,152	1,063
Accounts payable	393	542	504
Earnings tax liabilities	1,143	832	1,198
Advances from clients	29	55	29
Short-term leasing liabilities	219	223	223
Other current liabilities	2,582	2,776	1,908
Accrued expenses and prepaid earnings	3,973	2,450	4,225
Other short-term provisions	9	14	10
Total current liabilities	13,424	12,307	13,908
TOTAL SHAREHOLDERS' EQUITY AND LIABILITIES	90,027	83,189 88,883

Condensed consolidated statement of changes in shareholders' equity

	2022			2021
	Attributable to			Attributable to
	Parent	Non		Parent	Non
	Company's	controlling		Company's	controlling
SEK M	shareholder	interest	Total	shareholder	interest	Total
Opening balance, January 1	21,698	2,989	24,687	18,676	2,915	21,591
Repurchase of shares	–	–	–	–	–	–
Dividends paid	–	–	–	–	–	–
Change in Group structure	–	–	–	–	–	–
Treasury shares	–	–	–	–	–	–
Share base payment	-2	–	-2	–	–	–
Comprehensive earnings	1,047	93	1,140	1,565	93	1,658
for the period
Closing balance, March 31	22,744	3,083	25,826	20,241	3,008	23,249

Condensed consolidated cash flow statement

	First quarter		Full year
	Jan–Mar	Jan–Mar
	2022	2021	2021
Operating activities
EBIT	1,323	1,531	6,475
Depreciation/amortisation and impairment	390	326	1,500
Amortisation/revaluation of portfolio investments	1,226	1,005	4,178
Other adjustment for items not included in cash flow	-110	-196	-263
Interest received	12	4	22
Interest paid	-600	-558	-1,822
Other financial expenses paid	-52	-45	-213
Earnings tax paid	-215	-211	-893
Cash flow from operating activities before changes in working	1,975	1,856	8,985
capital
Changes in factoring receivables	-50	-42	-115
Other changes in working capital	44	-16	1,172
Cash flow from operating activities	1,969	1,798	10,042
Investing activities
Purchases of intangible fixed assets	-72	-74	-72
Purchases of tangible fixed assets	-10	-14	-262
Sale of tangible and intangible fixed assets	–	–	3
Portfolio investments in receivables	-968	-1,135	-7,038
Property holdings	-14	-7	70
Other cash flow from investing activities	98	63	-710
Cash flow from investing activities	-966	-1,167	-8,009
Financing activities
Borrowings and repayment of loans	-623	-646	2,139
Repurchase of shares	–	–	-41
Share dividend to parent company's shareholders	–	–	-1,451
Dividend to non-controlling shareholders	–	–	-244
Cash flow from financing activities	-623	-646	401
Total change in liquid assets	380	-15	2,434
Opening balance of liquid assets	4,553	2,134	2,134
Exchange rate differences in liquid assets	44	133	-15
Closing balance of liquid assets	4,977	2,252	4,553
Group total
Cash flow from operating activities	1,969	1,798	10,042
Cash flow from investing activities	-966	-1,167	-8,009
Cash flow from financing activities	-623	-646	401

Condensed income statement – parent company

	First quarter	Full year
	Jan–Mar	Jan–Mar
SEK M	2022	2021	2021
Revenues	180	152	690
Gross earnings	180	152	690
Sales and marketing expenses	-8	-7	-33
Administrative expenses	-346	-226	-1,037
EBIT	-174	-81	-380
Earnings from subsidiaries	0	0	0
Exchange rate differences on monetary items classified as	-99	-258	-316
expanded investment and hedging activities
Net financial items	-211	-229	912
Earnings before tax	-485	-568	216
Tax	0	–	0
Net earnings for the period	-485	-568	216

Net earnings for the period corresponds to comprehensive earnings for the period.

Condensed balance sheet – parent company

	31 Mar	31 Mar	31 Dec
SEK M	2022	2021	2021
ASSETS
Fixed assets
Intangible fixed assets	534	348	507
Tangible fixed assets	9	13	10
Financial fixed assets	74,180	70,099	73,991
Total fixed assets	74,723	70,460	74,508
Current assets
Current receivables	1,044	367	1,930
Cash and cash equivalents	619	584	602
Total current assets	1,663	951	2,532
TOTAL ASSETS	76,385	71,410	77,040
SHAREHOLDERS' EQUITY AND LIABILITIES
Restricted equity	814	285	786
Unrestricted equity	9,693	11,355	10,212
Total shareholders' equity	10,507	11,640	10,998
Long-term liabilities	56,684	52,758	55,498
Current liabilities	9,194	7,011	10,544
TOTAL SHAREHOLDERS' EQUITY AND LIABILITIES	76,385	71,410	77,040

Other information

Parent Company

The Group's publicly listed Parent Company, Intrum AB (publ), owns the subsidiaries, provides the Group's head office functions and handles certain Group-wide development work, services and marketing.

The Parent Company reported revenues of SEK 180 M (152) for the first quarter and earnings before tax of SEK -485 M (-568). The Parent Company invested SEK 58 M (58) in fixed assets for the quarter and at the end of the quarter held SEK 619 M (584) in cash and cash equivalents. The average number of employees was 60 (63).

Accounting principles

This interim report has been prepared in accordance with the Annual Accounts Act and IAS 34 Interim Financial Reporting for the Group and in accordance with Chapter 9 of the Annual Accounts Act for the Parent Company. In addition to appearing in the financial statements, disclosures in accordance with IAS 34.16A also appear in other parts of the interim report.

The accounting principles applied by the Group and the Parent Company are essentially unchanged compared with the 2021 Annual Report.

Transactions with related parties

During the quarter no significant transactions occurred between the Group and other closely related companies, board members or Group management team.

Market development and outlook

The Group's integrated business model consists of credit management services and portfolio investments and benefits from favourable medium term development prospects in both areas. The Group continues to execute its Transformation program and will gradually standardise, globalise and improve its collections processes. The Group anticipates the actions being taken in this area will continue to improve efficiency and margins, as well as enabling sustainable and organic growth.

Significant risks and uncertainties

Risks to which the Group and Parent Company are exposed include but are not strictly limited to any and all risks relating to economic developments, compliance and changes in regulations, reputation risks, tax risks, risks attribut¬able to IT and information management, epidemic and pandemic risks, geopolitical risks such as political risks, civil unrest, disruption, or conflicts including armed conflicts and war directly or indirectly affecting locations where Intrum or its clients maintain or conduct business, risks attributable to acquisitions, market risks, liquidity risks, credit risks, risks inherent in and associated with portfolio investments and payment guarantees, as well as financing risks. The risks are described in more detail in the Board of Directors' report in Intrum's 2021 Annual and Sustainability report. No new significant risks have arisen besides those described in the Annual and Sustainability report.

Fair value of financial instruments

Most of the Group's financial assets and liabilities (portfolio investments, accounts receivable, other receivables, cash and cash equivalents, liabilities to credit institutions, bonds, commercial paper, accounts payable and other liabilities) are carried at amortised cost in the consolidated financial statements. For most of these financial instruments, the carrying amount is deemed to be a good estimate of fair value. For outstanding bonds with a total carrying value of SEK 44,975 M (44,270) at the end of the quarter, fair value is, however, estimated at SEK 43,946 M (44,829). The Group also holds forward exchange contracts and other financial assets of SEK 187 M (172), as well as financial liabilities of SEK 241 M (245) carried at fair value through the income statement.

The share

Intrum AB's (publ) share is included in Nasdaq Stockholm's Large Cap list. During the period 1 January–31 March 2022, 25,265,241 shares were traded for a total value of SEK 6,372 M, corresponding to 21 per cent of the total number of shares at the end of the period.

The highest price paid during the period 1 January–31 March 2022 was SEK 283.9 (1 February) and the lowest was SEK 209.1 (7 March). On the last trading day of the period, 31 March 2022, the price was SEK 254.9 (latest paid). During the period 1 January–31 March 2022, Intrum AB's (publ) share price rose by 8 per cent, while Nasdaq OMX Stockholm fell by 15 per cent.

Share price, SEK (1 April 2019 – 31 March 2022)

Shareholders

		Capital and
31 March 2022	No of shares	Votes, %
Nordic Capital through companies	47,728,956	39.2
AMF Pension & Fonder	8,843,431	7.3
Swedbank Robur Fonder	5,507,909	4.5
Handelsbanken Fonder	4,603,167	3.8
Första AP-fonden	2,931,960	2.4
Vanguard	2,522,334	2.1
C WorldWide Asset Management	2,083,411	1.7
TIAA - Teachers Advisors	1,715,015	1.4
Norges Bank	1,469,291	1.2
Länsförsäkringar Fonder	1,356,309	1.1
Avanza Pension	1,325,405	1.1
BlackRock	1,182,831	1.0
Robeco	1,050,000	0.9
State Street Global Advisors	931,326	0.8
Capital Group	900,000	0.7
Total fifteen largest shareholders	84,151,345	69.2
Total number of shares excluding treasury	120,854,203

shares

Source: Modular Finance Holdings and Intrum

Treasury holdings of 866,715 shares are not included in the number of shares outstanding. The proportion of Swedish ownership amounted to 39.2 per cent (institutions 10.1 percentage points, mutual funds 18.4 percentage points and private individuals 10.7 percentage points).

Currency exchange rates

	Closing	Closing	Average	Average	Average
	rate	rate	rate	rate	rate
	31 mar	31 mar	Jan–Mar	Jan–Mar	Jan–Dec
	2022	2021	2022	2021	2021
1 EUR=SEK	10.33	10.24	10.48	10.12	10.48
1 CHF=SEK	10.07	9.25	10.11	9.27	9.80
1 NOK=SEK	1.06	1.02	1.06	0.99	0.98
1 HUF=SEK	0.028	0.028	0.029	0.028	0.0299

Events after the balance sheet date

No events after the balance sheet date.

For further information, please contact
Anders Engdahl, President and CEO, tel: +46 8 546 102 02
Michael Ladurner, CFO, tel: +46 8 546 102 02
Michael Ladurner, Investor Relations, tel: +46 8 546 102 02
Michael Ladurner is the contact under the EU Market Abuse

The information in this interim report is such as Intrum AB (publ) is required to disclose pursuant to the EU's markets abuse directive and the Securities Markets Act.

The information was provided under the auspices of the contact person above for publication on 29 April 2022 at 07.00 a.m. CET.

Year-end reports, interim reports and other financial information are available on www.intrum.com.

Denna delårsrapport finns även på svenska.

Stockholm, 29 April 2022

Anders Engdahl

Regulation.

President and CEO

Definitions

Result concepts, key figures and alternative indicators

Acquired growth

Growth in cash revenues related to mergers and acquisitions of Group companies.

Adjusted earnings per share

Net earnings for the period attributable to parent company's shareholders adjusted for IACs attributable to the parent company's shareholders and the corresponding tax amount divided by average number of outstanding shares for the period.

Adjusted revenues

Revenues excluding portfolio revaluations and other items affecting comparability.

Adjusted operating earnings (EBIT)

Adjusted operating earnings (EBIT) is operating earnings excluding revaluations of portfolio investments and other items affecting comparability.

Adjusted operating margin

Adjusted operating earnings (EBIT) in relation to adjusted revenues.

Adjusted segment earnings

Adjusted segment earnings is segment earnings excluding revaluations of portfolio investments and other items affecting comparability.

Amortisation percentage

Amortisation on portfolio investments during the period, as a percentage of collections.

Cash EBIT

Cash EBITDA less replenishment capex and other capex.

Cash EBITDA

Cash EBITDA is adjusted operating earnings (EBIT) adding back depreciation and amortisations and portfolio amortisations. In addition, the EBIT contribution from joint ventures is replaced by the actual cash contribution from the joint venture.

Cash EPS

Cash EBIT minus cash net financial items and cash net tax normalised divided by the average number of outstanding shares.

Cash return on invested capital (RoIC)

Annualised cash EBIT divided by average invested capital for the period. Average invested capital calculated using quarterly opening and closing balances for the relevant period. Year to date and RTM is calculated using the opening and closing balances of the quarters in the period.

Cash revenues

Revenues excluding non-cash revenues such as portfolio amortisation and earnings from joint ventures.

Cash tax normalised

Earnings tax paid adjusted for non recurring items.

Cash flow from joint ventures

The cash flow received by Intrum in form of distributions and dividends from investments in non-consolidated joint ventures.

EBITDA

EBITDA is defined as operating earnings (EBIT) adding back deprecation and amortisations of tangible and intangible assets.

Estimated remaining collections, ERC

The estimated remaining collections represent the nominal value of the expected future collection on the Group's portfolio investments, including Intrum's anticipated cash flows from investments in joint ventures.

Exchange rates

Growth in cash revenues related to the effects of changes in exchange rates.

External revenues

Revenues from Intrum's external clients and revenues generated from Real Estate Owned assets (REO).

Internal revenues

Predominantly related to revenues paid by the Portfolio Investment segment to Credit Management Services and Strategic Markets segments for collection activities made on the behalf of Intrum's own portfolios.

Items affecting comparability

Significant earnings items that are not included in the Group's normal recurring operations and that are not expected to return on a regular basis. These may include but are not limited to portfolio revaluations, restructuring costs, closure costs, reversal of restructuring or closure reservations, cost savings programs, integration costs, extraordinary projects, divestments, impairment of non-current fixed assets other than portfolio investments, acquisition and divestment expenses, advisory costs for discontinued acquisition projects, costs for relocation to new office space, termination and recruitment costs for members of Group Management and country managers, as well as external expenses for disputes and unusual agreements. Items affecting comparability are specified because they are difficult to predict and have low forecast values for the Group's future earnings trend.

Net debt

Net debt is interest-bearing liabilities and pension provisions less liquid assets and interestbearing receivables.

Net debt/cash EBITDA

This key figure refers to net debt divided by Cash EBITDA on a rolling 12-month basis. The key figure is included among the Group's financial targets, it is an important measure for assessing the level of the Group's borrowings and is a widely accepted measure of financial capacity among lenders. This key figure is calculated in accordance with the definitions stated in the terms of the Group's revolving syndicated loan facility, which means, among other things, that participations in non-consolidated joint ventures is only included to the extent that earnings are distributed to Intrum and that operations acquired during the period are included on a pro forma-basis throughout the 12-month period.

Operating earnings (EBIT)

Operating earnings consist of revenues less operating expenses as shown in the income statement.

Operating margin

The operating margin consists of operating earnings expressed as a percentage of revenues.

Operating margin, segment

The operating margin, segment consists of service line earnings expressed as a percentage of revenues.

Organic growth

Organic growth refers to the average increase in cash revenues in local currency, adjusted for revaluations of portfolio investments and the effects of acquisitions and divestments of Group companies. Organic growth is a measure of the development of the Group's existing operations that management has the ability to influence.

Other capex

Investments made to maintain and grow the business. For example, IT and tangible assets.

Portfolio investments – collected amounts, amortisations and revaluations

Portfolio investments consist of portfolios of delinquent consumer debts purchased at prices below the nominal receivable. These are recognised at amortised cost applying the effective interest method, based on a collection forecast established at the acquisition date of each portfolio. Revenues attributable to portfolio investments consist of collected amounts less amortisation for the period and revaluations. The amortisation represents the period's reduction in the portfolio's current value, which is attributable to collection taking place as planned. Revaluation is the period's increase or decrease in the current value of the portfolios attributable to the period's changes in forecasts of future collection.

Total portfolio investments made

The investments for the period in portfolios of overdue receivables, with and without collateral, investments in real estate and in joint ventures whose operations entail investing in portfolios of receivables and properties.

Replenishment capex

The estimated portfolio investments required to maintain the ERC in a steady state. Calculated by dividing the in quarter gross cash collections by the RTM MoM multiple.

REO Real estate owned.

Return on Portfolio Investments (ROI)

Return on portfolio investments is the service line earnings for the period, excluding operations in factoring and payment guarantees (financial services), recalculated on a full-year basis, as a percentage of the average carrying amount of the balance-sheet item purchased debt. The ratio sets the segment's earnings in relation to the amount of capital tied up and is included in the Group's financial targets. The definition of average book value is based on using average values for the quarters. Year to date and RTM is calculated using the opening and closing balances of the quarters in the period.

Revenues

Consolidated revenues include external servicing earnings (variable collection commissions, fixed collection fees, debtor fees, guarantee commissions, subscription earnings, etc.), earnings from portfolio investments operations (collected amounts less amortisation and revaluations for the period) and other earnings from financial services (fees and net interest from financing services).

RTM

Rolling Twelve Months, RTM, refers to figures on a last 12-month basis.

RTM MoM multiple

The average quarterly underwriting money-on-money multiple for the past 12 months. Calculated by dividing the lifetime ERC of acquired portfolios with the purchase price of the portfolios.

Segment earnings

Segment earnings relate to the operating earnings of each segment, Credit Management Services, Strategic Markets, Portfolio Investments and Group items.

About Intrum

Intrum is the industry-leading credit management company in Europe with presence in 24 markets. We help companies prosper by offering solutions designed to improve cash flow as well as long-term profitability and by caring for their customers. Our focus is to create shared value for business and society, which both benefit from companies being paid on time and citizens getting out of debt. Intrum has around 10,000 dedicated professionals who serve around 80,000 companies across Europe. In 2021, the company generated revenues of SEK 17.8 billion. Intrum is headquartered in Stockholm, Sweden, and the Intrum AB (publ) share is listed on the Nasdaq Stockholm exchange. For further information, please visit www.intrum.com.

Business model

We ensure that companies are paid by offering a full range of services covering companies' entire credit management chain. In our Credit Management Services and Strategic Markets segments we act as agents, collect late payments on our clients' behalf and generate a commission. In our Portfolio Investments segment we act as principals and invest in portfolios of overdue receivables as well as similar claims and collect on our own behalf.

Intrum as an investment

Growing market – The market for our services is growing, supported by our clients' desire to manage their balance sheets, also aided by regulation, focus on their core businesses as well as ongoing NPL generation. Digitisation and changes in customer behaviour lead to new types of receivables being generated. This market backdrop is a strong foundation for sustainable organic growth.

Market-leading position – Intrum is the industry leader in Europe, with a presence in 24 countries. We also work with partners to cover approximately 160 countries across the world. Given our comprehensive footprint we can partner with clients across several markets. Our broad knowledge spans multiple industries and our scale enables us to invest in the newest technologies and innovative solutions.

A complete range – Intrum offers a complete range of credit management services, covering companies' complete credit management chain.

Considerable trust and 100 years of experience – Our work can only be performed if we have our clients' complete trust and conduct our operations ethically and with respect for the end-customer. Our 100 years of experience demonstrate the strength of our business model. We build long-term partnerships with our clients.

Intrum leads the way towards a sound economy – A functioning credit market is a prerequisite for the business community and consequently for society as a whole. Intrum plays an important role in this context.

Financial targets

Returns: Cash RoIC >10% medium term

Growth: Cash EPS >10% p.a. on average medium term

Leverage: Net debt/Cash EBITDA 2.5–3.5x by end of 2022

Shareholder remuneration policy: Absolute annual increase in dividend per share

For further details and definitions, see https://www.intrum.com/investors/financial-info/ financial-targets/

Financial calendar 2022

29 April 2022	Annual General Meeting
21 July 2022	Interim report for the second quarter

Intrum AB (publ)

Sicklastråket 4, Nacka 105 24 Stockholm, Sweden Tel +46 8 546 10 200 Fax +46 8 546 10 211 www.intrum.com info@intrum.com