(Oslo ,17 August 2021 )Axactor SE (Axactor , OSE: ACR) delivered a total income in the second quarter ofEUR 65.9 million , up 130% from the same period last year (28.7 million), and an EBITDA* ofEUR 22.2 million , a significant improvement versus last year's second quarter (-30.0 million) as the return towards a normalized business environment continues. "Improved collections and recovery rates as well as improved cost position within our core business areas have been the key progress drivers this quarter. While the second quarter last year may not be the best benchmark due to the extraordinary situation caused by the global Covid-19 outbreak, we have improved the performance significantly versus the previous quarter. All in all, the second quarter takes us one step closer towards our key financial objective of delivering an attractive return on equity for shareholders," saysJohnny Tsolis , CEO ofAxactor .Axactor delivered a 34% increase in gross revenue* toEUR 95.2 million (70.8). Total income in the second quarter wasEUR 65.9 million (28.7), representing an increase of 130%. EBITDA* wasEUR 22.2 million (-30.0) and cash EBITDA* ended atEUR 65.7 million (44.4), equivalent to an increase of 48% compared to the corresponding period last year. Operating profit (EBIT) wasEUR 19.8 million for the second quarter (-32.6). Net profit ended atEUR 4.4 million (-44.4) including a positive one-off foreign exchange gain ofEUR 1.5 million and a negative one-time effect ofEUR 0.6 million in write-down of capitalized loan fees. Operating expenses for the quarter includeEUR 0.9 million in restructuring costs related to the cost saving program initiated earlier in 2021. Estimated annual savings from cost saving actions implemented during the first half 2021 isEUR 3.9 million . Expected annual savings when all initiatives are implemented at year-end isEUR 5.2 million . "Our cost saving program is progressing well, and we realized higher savings than estimated in the second quarter. The program is one of several components to further improve profitability and we expect the cost reduction program to reach full P&L-effect in the fourth quarter this year," addsJohnny Tsolis .Axactor's annualized return on equity excluding non-controlling interests for the second quarter 2021 was 6.9% (-36.1%). Business segment updateAxactor operates in two main segments: non-performing loans (NPL) and third-party collection (3PC). The real estate owned (REO) segment is treated as a run-off scenario and is expected to steadily decline over time. NPL gross revenue was all-time high in the second quarter despite marginally declining book value. NPL gross revenue grew 27% toEUR 69.0 million (54.5). The NPL total income grew 221% toEUR 39.7 million from the second quarter last year (12.4). The growth came partially because of higher activity levels as societies are reopening, but also as a result of continuous investments in new NPL portfolios over the last twelve months. In addition, net revalutions for the quarter ended atEUR -1.4 million , compared toEUR -27.0 million for the second quarter 2020. NPL investment was at a historic low ofEUR 12.3 million in the second quarter asAxactor continues to strictly prioritize the best deals.Axactor is currently acquiring portfolios at attractive rates, with gross IRR on signed forward flow contracts 47% higher than on the current book. As such,Axactor expect current book gross IRR on non-performing loans to improve over time. 3PC total income grew 34% compared to the second quarter last year, ending atEUR 12.9 million (9.7). The impacts of government-imposed restrictions throughoutEurope are still affecting operations, although the impacts are gradually reducing. Several new 3PC deals have been signed during the quarter, including a transformational deal forAxactor inSweden . The deal establishesAxactor as a serious contender in the Swedish 3PC market, a market whereAxactor has previously held a very small market share. Outlook Going forward,Axactor expects 3PC volume to return to pre-pandemic levels as societies re-open, and to see market activity increase for both 3PC and NPL. The company is strictly prioritizing the best NPL deals and expect NPL investments of approximatelyEUR 200 million for 2021, depending on market activity in the fourth quarter. However,Axactor will prioritize NPL deleveraging over investments if market prices are perceived as unfavorable. For the cost savings program initiated in the first quarter 2021,Axactor targetsEUR 1.2 million in additional annualized savings by year-end, bringing the total expected annual savings to an estimatedEUR 5.2 million . "Through continued focus on cost efficiency, improving tax rates and lower funding cost,Axactor expects return on equity to increase further over time. Favorable changes to the business mix are also expected to have a positive impact, through growth in the capital light 3PC segment and a decreasing REO portfolio," concludesJohnny Tsolis . *EBITDA and other alternative performance measures (APMs) are defined and reconciled to the IFRS financial statements as a part of the APM section on page 34 of the second quarter and half-year 2021 financial report. Live presentation and webcastAxactor will present its interim second quarter and half-year 2021 financial results today at08:30 am (CET) . The presentation will take place atHotel Continental , Stortingsgata 24/26,Oslo at 08.30 (CET). The presentation will be held in Norwegian. For attendance atHotel Continental please send an e-mail to liv.overby@axactor.com. In addition, there will be a global investor webcast with a live Q&A session at 10.00 (CET). The webcast will be held in English and can be accessed through the following URL: https://streams.eventcdn.net/axactor/q2-2021/register or through participant dial-in:Denmark : +4578723250Norway : +4723500236Sweden : +46850558355United Kingdom : +443333009035United States : +16467224902 For additional information, please contact:Johnny Tsolis , CEO,Axactor , tel: +47 913 35 461, e-mail: johnny.tsolis@axactor.comKyrre Svae , Chief of Strategy & IR,Axactor , tel: +47 478 39 405, e-mail: kyrre.svae@axactor.com AboutAxactor Axactor Group is a next-generation debt management company operating inNorway ,Sweden ,Finland ,Germany ,Spain andItaly with an ambitious growth strategy.Axactor acquires and collects on own portfolios of non-performing loans and also provides debt collection and accounts receivable management for third parties. After only six years in business, external analysis show thatAxactor already has an industry leading cost-to-collect ratio on NPL. The company has approximately 1,100 employees. To learn more, visit www.axactor.com This information is considered to be inside information pursuant to the EU Market Abuse Regulation and is subject to the disclosure requirements pursuant to Section 5-12 the Norwegian Securities Trading Act. Thisstock exchange announcement was published byKyrre Svae , Chief of Strategy & IR atAxactor SE , on17 August 2021 at07:00 CET .
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