Intrum Justitia AB: Year-end report 2014
Comment by President and CEO Lars Wollung
Intrum Justitia’s strong performance continued into the fourth quarter. Consolidated income rose by 8 percent and operating earnings increased by 13 percent compared with the yearearlier period, adjusted for currency effects, revaluations of purchased debt portfolios and items affecting comparability. It is mainly the Central Europe and Western Europe regions that are contributing to growth and the improvement in earnings. We are retaining a high level of profitability in Northern Europe, but the performance remains relatively unchanged compared with the year-earlier period. For our service lines, both Financial Services and Credit Management contributed to the improvement in earnings in the fourth quarter.
Investments in purchased debt in the fourth quarter totaled SEK 454 M, which contributed to a healthy increase of 15 percent in the carrying amount of purchased debt since the end of 2013. Moreover, the fourth quarter has seen a solid return for purchased debt of 21 percent excluding items affecting comparability. The supply of purchased debt has been relatively good in several countries, but we have also seen persistently high price competition in a number of markets.
We can look back on a very positive financial development for the full-year 2014. In relation to our financial objectives, we are achieving an increase in earnings per share of 31 percent, which is well above our target of a minimum 10 percent increase, and a return on purchased debt of 20 percent, which exceeds our target of a return of at least 15 percent. For our third objective regarding debt (net debt in relation to operating earnings before depreciation and amortization), we report a ratio of 1.9, which is just short of our target of a minimum of 2.0.
Intrum Justitia is well positioned to achieve continued healthy growth during the coming years. We have an effective business model, with credit management services and financial services combining to provide mutual support. Our organization has a strong focus on constant improvements, with continual development and follow up of a vast number of change management projects in all countries. Over the next few years, we therefore see good opportunities for profitable growth, mainly through increased operational efficiency, growth within purchased debt, acquisitions within Credit Management and development of new services for financing before an invoice has fallen due.
Presentation of the year-end report
The interim report and presentation material are available at www.intrum.com/Investor relations. President & CEO Lars Wollung and Chief Financial Officer Erik Forsberg 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, +44 (0) 203 428 1434 (UK) or +46 (0) 8 566 426 92 (SE).
For further information, please contact:
Erik Forsberg, CFO
Tel: +46 8 546 102 02
Intrum Justitia is Europe’s leading Credit Management Services (CMS) group, offering comprehensive services, including purchase of receivables, designed to measurably improve clients’ cash flows and long-term profitability. Founded in 1923, Intrum Justitia has some 3,600 employees in 20 markets. Consolidated revenues amounted to about SEK 4.6 billion in 2013. Intrum Justitia AB is listed on NASDAQ OMX Stockholm since 2002. For further information, please visit www.intrum.com