Interim Report January-March 2011
- Consolidated net revenues for the first quarter of 2011 amounted to SEK 931.8 M (955.2). Adjusted for currency effects, revenues rose by 5.1 percent, of which organic growth amounted to 1.4 percent (1.4).
- Operating earnings (EBIT) amounted to SEK 165.7 M (157.0) including the loss of SEK 8.1 M on the divestment of the Group’s shareholding in an Icelandic associated company. Adjusted for this loss and currency effects, this corresponds to an increase of 18.2 percent.
- The operating margin, excluding the loss on the divestment of the associated company was 18.7 percent.
- Net earnings for the quarter amounted to SEK 108.8 M (100.4) and earnings per share were SEK 1.35 (1.26).
- Investments in Purchased Debt amounted to SEK 370.0 M (170.8), an increase of 117 percent.
- Cash flow from operating activities remains strong, amounting to SEK 322.8 M (327.0).
- The Group’s credit facility has been increased to SEK 4 billion. The framework of the agreement provides scope for an additional SEK 2 billion in ancillary financing. The new agreement is valid for a period of five years.
| Intrum Justitia has had a good start to 2011 and our operating earnings rose by 18 percent adjusted for currency effects and a loss in connection with our divestment of our associated company in Iceland. Intrum Justitia’s service line Purchased Debt developed very well during the quarter. The level of investment has more than doubled to SEK 370 M compared with the preceding year. Adjusted for currency effects, operating earnings rose by 44 percent and return for the quarter amounted to 19.3 percent. We see continued favorable activity with regard to small and medium-sized portfolios and demand for integrated services that include what are known as forward-flow contracts is increasing. Development has been good in Intrum Justitia’s Credit Management service line. The measures taken in recent years to improve efficiency in operations and increase sales activities have produced the desired results. The integration of new and previous acquisitions has also progressed according to plan. First quarter earnings were, however, held back by lower earnings in the Netherlands compared with the preceding year, while countries such as France and the Nordic countries have developed well. The Northern Europe region has developed well, both in Credit Management and Purchased Debt. Pleasingly enough, the level of investment has risen considerably compared with last year, resulting in a strong improvement in margins. Currency-adjusted operating earnings rose by 47 percent and the margin strengthened to about 20 percent. In the Central Europe region, the currency adjusted operating result decreased by 28 percent och the margin was 17 percent. However, if the German operations are excluded, earnings growth in the region is good. In Germany, the aging purchased debt portfolio entails declining volumes. A new country organization, focused strongly on sales activities and seeking new debt portfolios, is now being established. The positive trend in Hungary, Slovakia and the Czech Republic has continued during the first part of the year, with increased operating earnings. In the Western Europe region, currency-adjusted operating earnings rose by 9 percent and the margin strengthened to 16 percent. Thanks to good cost control in the Credit Management service line and a strong trend in Purchased Debt, we are succeeding well despite the continued challenging macroeconomic climate. In the Netherlands, measures to adjust the cost base have begun to take effect although development for the quarter was unsatisfactory. All indicators suggest that demand for services combining traditional Credit Management with Purchased Debt will continue to increase in 2011. As a market leader, with an integrated range of services in these areas, Intrum Justitia benefits by this trend. We see good opportunities to continue expanding our service offering, particularly early in the payment chain, in areas such as credit decision solutions and payment solutions. Our extensive program of measures to enhance earnings in the Credit Management service line is continuing and is expected to generate beneficial effects over the coming years. It is also our assessment that the Group’s investments in debt portfolios will exceed SEK 1 billion during 2011. The interim report and presentation material are available at www.intrum.com. > Investors. President & CEO Lars Wollung and Chief Financial Officer Bengt Lejdström will comment on the report at a teleconference today, starting at 9:00 a.m. CET. The presentation can be followed at www.intrum.com and/or www.financialhearings.com. To participate by phone, call +46 (0)8 5051 3793 (SE) or +44 (0)20 7806 1967 (UK).For more information, please contact: |
Lars Wollung, CEO & President
Tel: 46 8 546 102 02
Erik Forsberg, CFO
Tel: 46 8 546 102 02, E-mail: e.forsberg@ intrum.com
Annika Billberg, IR & Communications Director
Tel: 46 702 67 97 91, E-mail: a.billberg@intrum.com
Intrum Justitia is Europe’s leading Credit Management Services (CMS) group and offers services designed to measurably improve clients’ cash flows and long-term profitability. Intrum Justitia was founded in 1923, has around 3,100 employees in 22 countries and revenues of approximately SEK 3.8 billion in 2010. Intrum Justitia AB is listed on NASDAQ OMX Stockholm since 2002. For further information, please visit www.intrum.com