DDM Holding AG: Interim report January–September 2015
Significant transactions in the pipeline
Highlights third quarter 2015
- Pipeline remains strong with significant transactions expected to be signed in Q4
- Net collections decreased by 8 percent to EUR 2.4M (Q3 2014: EUR 2.6M)
- Cash EBITDA amounted to EUR 1.1M (Q3 2014: EUR 1.6M)
- Gross ERC as of end of September 2015 is EUR 57.2M (Q3 2014: EUR 56.5M)
Highlights first nine months 2015
- Net collections increased by 38 percent to EUR 11.6M (9 months 2014:EUR 8.4M)
- Cash EBITDA amounted to EUR 7.5M (9 months 2014: 5.1M)
Comment by the CEO
Following successful completion of our refinancing in the second quarter 2015, the third quarter 2015 has been marked by work on significant transactions where DDM is in exclusivity. Some of these are expected to be signed before the end of the year and contribute to a positive result for the full year 2015.
In tandem with these processes, we continue to work on our capital structure raising additional funding for coming investments.
Gross ERC (Estimated Remaining Collections) increased by 1% during the third quarter 2015 as compared to the same period in 2014.
Net collections in the third quarter of 2015 amounted to EUR 2.4M, a decrease of 8% compared to third quarter 2014, while net collections increased by 39% for the first nine months in 2015, compared to the same period last year.
Collections in Russia temporarily slowed down during the third quarter due to the weakness in the Russian ruble, but improved at the end of the quarter as the ruble recovered. Collections in Poland have not been performing according to initial forecast as legal collections have taken longer than expected. We are actively working with our servicers to catch up to our timetable and do not foresee any adjustments to the ERC relating to the Polish portfolios. Our actions and efforts continue to result in strong collections in Romania and Czech Republic. In addition, our investment in Hungary shows strong performance and collections are outperforming the original forecast.
Cash EBITDA (net collections less operating expenses) during the third quarter amounted to EUR 1.1M, a decrease of 32% compared to the same period 2014, while increasing by 47% for 9 months 2015, compared to the nine months in 2014.
Cash flow from operating activities before working capital changes was EUR 1.8M in the first nine months 2015, an increase of 194% compared to the same period in 2014, while cash flow from operating activities in the third quarter 2015 was negative EUR 2.2M, largely a reflection of the costs associated with the refinancing undertaken at the end of the second quarter.
Market outlook
We remain positive on the outlook of DDM as we continue to see strong growth in our pipeline of investment opportunities and reinforcement of DDMs position in the market as a leading investor and manager of distressed assets. We currently work on several significant transactions in exclusivity with the selling party and we anticipate signing some of these before the end of the year, contributing to a strong result for the full year 2015.
Presentation of the interim report
The Interim Report and presentation material are available at www.ddm-group.ch on 12 November 2015, at 08:00 a.m. CET.
CEO Gustav Hultgren and CFO Fredrik Olsson will comment on the report at a conference call on 12 November 2015, starting at 10:00 a.m. CET. The presentation can be followed live on www.ddm-group.ch
Please find attached the full report.
For more information, please visit DDM’s website at www.ddm-group.ch or contact:
Anders Antonsson, Investor Relations
Mail: a.antonsson@ddm-group.ch | Tel: 46 8 4080 9030
DDM Holding AG (Nasdaq First North Stockholm: DDM) is a multinational investor and manager of distressed assets. Since 2007, the DDM Group has built a successful platform in Eastern Europe, with 2.2 million receivables in nominal value over EUR 1.7 billion. DDM Treasury Sweden AB (publ) (NGM: DDM1) is a subsidiary wholly owned by DDM Holding AG. Pareto Securities is DDM Holding AG’s Certified Adviser.
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