IuteCredit has reported its unaudited results for 6M 2021. Below, you can read the operational, strategic, and financial highlights of the company’s report, as well as comments from the CEO of IuteCredit. 

Operational highlights

• Loan payouts increasing year-on-year (y-o-y) with record-high months in May and June, with the Balance sheet up 6.1% to 123.7 million EUR 
• The number of loans signed up y-o-y 47.9% to 137,367 (6M/2020: 92.880) steadily increasing as of June
• The principal amount of loans issued increased 49.7% to 74,723 million EUR (6M/2020: 49.914 million EUR)
• Gross loan portfolio up 8.7% to 103.3 million EUR (31 December 2020: 95.0 million EUR)
• Repayment discipline (Customer Performance Index, CPI30) further improving to 86.9%
• Net loan portfolio up 11.3% to 88.1 million EUR (31 December 2020: 79.2 million EUR)
• EUR 3.0 million cash inflow from the court-appointed liquidator of the business activities in Kosovo

Strategic highlights

• Increasing geographical and product diversification
• Next successful steps for an extraordinary customer experience in an IuteCredit ecosystem with additional services, such as insurance brokerage, certain data certificates, etc.
• Strong growth in the digitalization of IuteCredit countries towards a fully digital customer journey and the imminent breakthrough of online shopping

Financial highlights

• Interest and commission fee income up 3.0% to 23.4 million EUR (6M/2020: 22.7 million EUR) affected by steadily increasing payouts compared to the 13.9% increase in the average net loan portfolio
• Net interest and commission fee income down 1.1% to 17.0 million EUR (6M/2020: 17.1 million EUR) in connection with the bond issue related to expected business growth
• Total income up 1.1% to 29.2 million EUR (6M/2020: 28.9 million EUR)
• Cost to income ratio at 36.0% (6M/2020: 27.1%) as a result of recovering business activity and the related normalization of costs
• EBITDA increased by 13.9% to 11.3 million EUR (6M/2020: 9.9 million EUR)
• Net profit more than doubled to 3.0 million EUR (6M/2020: 1.3 million EUR)
• Strong capitalization and profitability exceeding Eurobond covenants

IuteCredit’s CEO comments

Tarmo Sild, Group CEO of IuteCredit: “Q2/2021 is the first quarter of real growth we have eagerly expected since last autumn. Exceeding 29 m EUR for all financial services of the Group in H1/2021, we even achieved a new record in total revenue. The trend of irreversible and constantly accelerating digitalization is also reflected in the flourishing business of IuteCredit. In the first six months of 2021, we generated more than 6% of total revenue from various services related to payments, cards, and cash transactions via IuteCredit’s proprietary ATMs that can be accessed easily and fast with a smartphone. All without the need for a debit or credit card. And even more, over 20% of all customers signings in the Q2/2021 were smartphone-based, using either one-time-passwords or biometrics. And last but not least, MyIute app has already been downloaded by more than 50,000 people, even though it was not launched until Q1/2021. Having said that, our customers continued to take out and repay more loans.

The ongoing breakthrough of digitalization is directly reflected in improving IuteCredit’s profitability. We make more money with economies of scale that result in an improved revenue/OPEX ratio. Consolidated assets climbed from 116 million EUR to 123 million EUR as the net loan portfolio grew from 81 million EUR to 88 million EUR. Similar growth applied to the gross loan portfolio. In contrast, liabilities to investors only increased from 94 million EUR to 98 million EUR.

At the same time, the interest rate structures and maturities of our products are changing. Currently, newly issued loans’ average APR stands just above 50%, while maturity is longer than 20 months. In the same period of the previous year, we were still at about 60% and about 16 months. Loan repayment discipline, measurable as a ratio of actual incoming repayments cash flow versus expected repayments cash flow, with maximum delay tolerance of 30 days, remains close to 90%. We recover more than 40% of the defaulted principal within the first 180 days from the date of default.

The free cash position at 15 million EUR remains high as we continue to actively seek growth opportunities. Investment priority for IuteCredit is our mission to offer extraordinary experience in the field of personal finance.

The markets are returning to cautious optimism, which is visible in the loan applications increase. We look impatiently forward to Q3/2021 and expect it to offer new opportunities for the Company and its investors. Given the past performance and prudent future projections, we are even more optimistic that 2021 total revenue will exceed 55 million EUR while the net profit should surpass 6 million EUR. An increase in total assets to 170 million EUR by the end of 2021 also remains a realistic target.” 

About IuteCredit

IuteCredit – established in 2008 – is a European personal finance company. The Group specializes in consumer credit via its 100% subsidiaries using equity and loan capital. IuteCredit serves customers currently in Moldova, Albania, North Macedonia, Bulgaria, and Bosnia and Herzegovina. IuteCredit’s loan products are unsecured consumer loans with maturities between 1 month and 36 months and car-secured loans with maturities up to 60 months. The mission of IuteCredit is to create an extraordinary experience in personal finance by exceeding customers’ expectations.