DDM Treasury publishes its Interim Report (January-June 2014)

Second quarter 2014

  • Consolidated net revenues for the period April–June 2014 amounted to SEK 18.6M

  • Operating earnings (EBIT) amounted to SEK 16.8M, including revaluations of purchased asset portfolios amounting to SEK 8.7M

  • Operating margin (EBIT) was 69%

  • Net profit for the period amounted to SEK 16.0M

First six months of 2014

  • Consolidated net revenues for the period January–June 2014 amounted to SEK 33.9M

  • Operating earnings (EBIT) for the period January–June 2014 amounted to SEK 29.7M. Operating earnings include revaluations of purchased asset portfolios amounting to SEK 23.9M

  • DDM Treasury Sweden AB (publ) and the consolidation with its subsidiary DDM Invest XX AG was founded mid-2013, therefore comparable numbers for the consolidated entity are limited to June 2013

Excerpts from the Interim Report:

Comment by the CEO

Following a turbulent first quarter of 2014, with geopolitical turbulence and pressure on the Russian Ruble, the second quarter 2014 was characterised by two mile stone events. Firstly, preparations for the listing of the ultimate parent company of DDM Treasury DDM Sweden AB, DDM Holding AG, which was listed on Nasdaq OMX First North in Stockholm. Secondly, DDM has made investments in portfolios acquired in core, and new markets.

During the second quarter 2014 DDM reengaged with investments in Russia and also made a first investment in Slovenia. During the first six months of 2014, DDM invested in portfolios to a total amount of SEK 89.2M.

DDM continues to focus on its historical core markets, Russia and Romania, and at the same time also dedicating efforts to the wider region of Eastern Europe, where we see great potential and hope to announce further acquisitions and markets entries in the coming period.

Earnings before depreciation and amortisation (EBITDA) period April–June 2014 amounted to SEK 22.7M. Operating earnings (EBIT) amounted to SEK 16.8M, and operating margin was 69%. This result includes revaluations of purchased asset portfolios of SEK -8.7M (DDM Treasury Sweden AB and the consolidation with its subsidiary DDM Invest XX AG was founded mid-2013, therefore comparable numbers for the consolidated entity are limited to June 2013.)

I am pleased to welcome our new CFO, Mr. Fredrik Olsson, to DDM. He will join the company on 1 September 2014 and will be instrumental in the group’s consolidation, accounting and related processes.

Market outlook

The core markets are characterised by considerable regional differences and there is substantial uncertainty regarding the macroeconomic situation in several countries in the region. In a substantially weakened macroeconomic situation, with increased unemployment and volatile exchange rates, DDM could be negatively affected.

In DDM’s view, the group’s strategic focus is well attuned to the market trend, where selling companies and banks need to generate stronger and more predictable cash flow, as well as the need to create additional alternatives for financing, for example by selling portfolios. These are trends that, in the long term, will benefit DDM.

For more information, please contact:

Anders Antonsson, Investor Relations
Mail: a.antonsson@ddm-group.ch | Tel: 46 8 4080 9030

Gustav Hultgren, CEO of DDM
Tel: 46 8 4080 9030

DDM Treasury Sweden AB (publ) (NGM: DDM1) is a subsidiary wholly owned by DDM Holding AG. DDM Holding AG is a leading multinational investor and manager of distressed assets. Since 2007, the DDM Group has built a successful platform in Eastern Europe, with over 2 million receivables in nominal value over EUR 1.4 billion.

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About Us

DDM Treasury AB (publ) is a subsidiary of DDM Holding AG (First North: DDM) a leading acquirer and manager of distressed assets, offering the prospect of attractive returns from the expanding Central and Eastern Europe market. Since 2007, the DDM Group has built a successful platform in Central and Eastern Europe, currently managing 2.3 million receivables with a nominal value of over EUR 2 billion. For sellers (banks and financial institutions), management of portfolios of distressed assets is a sensitive issue as it concerns the relationship with their customers. For these sellers, it is therefore critical that the acquirer handles the underlying individual debtors professionally, ethically and with respect. DDM has longstanding relations with sellers of distressed assets, based on trust and the Company’s status as a credible acquirer. The banking sector in Central and Eastern Europe is subject to increasingly stricter capital ratio requirements resulting in distressed assets being more expensive for banks to keep on their balance sheets. As a result, banks are increasingly looking to divest portfolios of distressed and other non-core assets. DDM Holding AG, the Parent Company, is a company incorporated and domiciled in Baar, Switzerland and listed on Nasdaq First North in Stockholm, Sweden, since August 2014.

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