Half-year Report
27 July 2022
International Personal Finance plc
Half-year financial report for the six months ending 30 June 2022
Principal activity
International Personal Finance plc is helping to build a better world through financial inclusion by providing unsecured consumer credit to 1.7m underserved customers across nine countries.
SUSTAINABLE GROWTH AND STRONG FINANCIAL PERFORMANCE
Key highlights
| Ø | Very good first half financial performance underpinning a 23% increase in the interim dividend | ||
| · | Reported first-half profit before tax of £33.8m (H1-21: £43.3m), with all businesses delivering profitable performances. | ||
| · | Underlying first-half profit before tax grew by 45%, after excluding Covid-19 impairment provision releases in H1-21 of £20m. | ||
| · | Increase in the interim dividend of 23% to 2.7 pence per share, consistent with the new progressive dividend policy announced in February 2022 (H1-21: 2.2 pence). | ||
| Ø | Strong growth in customer lending and excellent credit quality | ||
| · | Customer lending increased by 14% (at CER) driven by improving demand. | ||
| · | Closing customer net receivables of £770m, up 14% year on year (at CER). | ||
| · | Customer number growth of 2% to 1.72m customers. | ||
| · | Strong customer repayment performance together with tight credit standards delivered an impairment rate of 7.5% (H1-21: 6.5%). | ||
| Ø | Robust funding position and well-capitalised balance sheet | ||
| · | Headroom on funding facilities of £68m, supports the Group's growth plans into Q4-23. | ||
| · | Equity to receivables ratio of 52.4% at H1-22 (H1-21: 53.8%), supports growth plans and progressive dividend policy. | ||
| Ø | Substantial and sustainable long-term opportunities | ||
| · | Developing exciting new loan card offering to meet the future needs of consumers in Poland; testing due to commence in Q4-22. | ||
| · | Expanded customer representative network and opened new region in Northwest Mexico. | ||
| · | Clearly defined financial model implemented throughout the Group, which aligns all stakeholders and is underpinned by a new target ROE of 15%+. | ||
| Group key statistics | H1-22 | H1-21 | YOY change at CER |
| Customer numbers (000s) | 1,718 | 1,679 | 2.3% |
| Customer lending (£m) | 513.3 | 459.9 | 13.9% |
| Closing net receivables (£m) | 769.9 | 674.2 | 14.0% |
| Reported PBT (£m) | 33.8 | 43.3 | (21.9%) |
| Pre-exceptional EPS (pence)* | 9.1 | 10.3 | (11.7%) |
| Annualised pre-exceptional ROE (%)* | 10.4 | 6.4 | 4.0 ppts |
| Interim dividend per share (pence) | 2.7 | 2.2 | 22.7% |
* Before an exceptional tax credit of £10.5m, see below for details.
Gerard Ryan, Chief Executive Officer at IPF commented:
"We delivered strong growth and a very good financial performance across the Group in the first half of the year. I am pleased to report a 45% growth in underlying profit before tax, with all of our businesses being profitable in the period. We continued to successfully execute our growth strategy and have attracted more customers, increased customer lending in all of our divisions and maintained our focus on excellent credit quality. Whilst the external landscape has become more challenging due to global inflationary pressure and the uncertainties caused by the war in Ukraine, we saw a steady improvement in demand over the course of the second quarter which has continued into the third quarter.
I would like to thank all of our colleagues for their contribution to this result and their ongoing care for our customers and the communities we serve. We see substantial and sustainable long-term growth opportunities for the Group which we will achieve by meeting the needs of more customers with an increased choice of products and distribution channels."
Please refer to the associated PDF document to view the full announcement.
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