Intrum – solid start of 2018
This information is information that Intrum Justitia AB (publ) is obliged to make public pursuant to the EU Market Abuse Regulation. The information was submitted for publication, through the agency of the contact person set out below, at 07.00 CET on 2018-04-27.
- Operating earnings, adjusted for non-recurring expenses and revaluations of portfolios of receivables improved to SEK 973 M. Compared to the first quarter (pro forma) of 2017 operating earnings increased by 10 percent.
- Portfolio investments for the quarter amounted to SEK 1,373 M. The carrying amount for portfolio investments has risen by 7 percent since the end of 2017.
- The sale of Intrum Justitia’s former subsidiaries in Norway and Lindorff’s former subsidiaries in Sweden, Denmark, Finland and Estonia was completed on March 20, 2018.
“Intrum has had a stable start to 2018 with underlying growth in operating earnings of 10 percent in the first quarter. We are also seeing our portfolio investments continuing to develop well and we invested SEK 1.4 billion in new portfolios during the quarter. In Credit Management, sales increased by 3 percent, and although the operating margin has fallen slightly to 25 percent, our cost-cutting measures and increased efficiency have begun to yield results, and we anticipate progressively increasing margins for the remainder of 2018. Overall, I am very pleased with how we have begun 2018,” says Mikael Ericson, President and CEO of Intrum.
The integration and restructuring processes following the merger with Lindorff has continued in early 2018 and in the countries where operations are being merged, several initiatives have been taken to ensure integration is completed according to plan. In Spain, around 18 offices will close and the number of employees will be reduced by about 400 people. In the Netherlands, operations from two offices will be merged and this is scheduled for completion by the end of the summer.
“Integration efforts are continuing, and we are now working intensively to ensure that our operations are run efficiently and with substantial focus on delivering value to clients and customers. To date, we have realized SEK 280 million of the cost synergies we anticipated in connection with the merger. This is in line with overall target of realizing SEK 580 million in cost synergies by 2020,” says Mikael Ericson.
Following the end of the quarter, Intrum has signed an agreement with the Italian bank, Banca Intesa Sanpaolo, on a long-term partnership in which Intrum, together with Intesa Sanpaolo, will establish a market-leading unit for the handling of past-due receivables in Italy. The deal will be completed in the fourth quarter of 2018, and Intrum’s net investment is expected to be EUR 670 million.
“The transaction with Intesa Sanpaolo is a milestone for Intrum, whereby we clearly demonstrate how our market-leading position and many years of experience in credit management generate opportunities for transactions that will transform our entire industry. European banks have a great need to find partners able to support them in reducing their exposure to past-due and amortized loans in their balance sheets, and Intrum is one of the few players able to embark on partnerships of that kind,” concludes Mikael Ericson.
The interim report and presentation material are available at www.intrum.com/Investor relations.
President & CEO Mikael Ericson and Acting CFO Thomas Moss will comment on the report at GT30, Grev Turegatan 30, in Stockholm, on April 27, starting at 9:00 a.m. CET.
The presentation can also be followed at www.intrum.com and/or www.financialhearings.com.
To participate by phone, call +46 8 566 427 01 (SE), +44 20 300 898 17 (UK), or +1 855 753 2236 (US).
For further information, please contact:
Mikael Ericson, President and CEO, tel: +46 8 546 102 02
Thomas Moss, Acting CFO, tel: +46 8 546 102 02
Louise Bergström, Investor Relations Manager, tel: +46 8 546 103 42
Intrum is the industry-leading provider of Credit Management Services with a presence in 24 markets in Europe. Intrum helps companies prosper by offering solutions designed to improve cash flows and long-term profitability and by caring for their customers. To ensure that individuals and companies get the support they need to become free from debt is one important part of the company’s mission. Intrum has more than 8,000 dedicated and empathetic professionals who serve around 80,000 companies across Europe. In 2017 pro-forma revenues amounted to SEK 12.2 billion. Intrum is headquartered in Stockholm, Sweden and the Intrum share is listed on the Nasdaq Stockholm exchange. For further information, please visit www.intrum.com.