|Emitents||mogo AS (213800DOKX626GYVOI32)|
|Veids||2.2. Iekšējā informācija|
Operational and Strategic Highlights
Financial Highlights and Progress
Modestas Sudnius, CEO of Eleving Group, commented:
"Looking back at the last quarter, we see that Eleving Group has successfully managed the challenges faced by the global economy. We see that the business is stable, and that's exactly what we wanted to achieve - to increase the quality of the portfolio and sustain a healthy growth pace. Given the rising inflation, we see that the payment discipline of our clients is slightly changing, but it does not have an impact on our portfolio at significant levels. The reason for that is the strategy we have set previously that is showing its effectiveness during the third and previous quarters of this year.
After a slightly slower first half, in the third quarter, we could see a gradual improvement in consumption figures in the markets we represent, which we see in an increase in the number of applications received and overall growth in the portfolio. Disregarding obtained markets, the net loan portfolio grew by close to 3% in the third quarter. Our consumer lending segment continues to show solid growth in Balkan markets, while the vehicle segment is picking up healthy dynamics again.
In Q3, as in previous ones, one of our key priorities was to streamline our business processes. We continued to improve our underwriting policy and further reviewed our administrative costs and pricing strategies. At the moment, I believe that we have done an excellent job in the areas listed above to successfully overcome the winter period, which often has a particular impact on customers and their ability to meet their obligations.
The main operational focus for the group in the third quarter was the integration of Express Credit – a consumer lender in the South African region, which Eleving Group obtained in July, into the Group's systems and procedures. We aim to finish technical integration during this year and expect a noticeable increase in efficiency and cost-effectiveness after this is done. Newly obtained businesses have great potential for growth in the near future, and, already in the third quarter, it has delivered a sizable addition to Eleving Group’s results.
At the same time, we have not stopped pursuing our green course. In Kenya, our e-boda business is gathering momentum, and we see increasing interest in electric mobility from local consumers and small businesses. In addition, we are a few steps away from launching an identical service in Uganda. Meanwhile, OX Drive has continued to perform strongly in the third quarter, and it is clear that green car-sharing is becoming a preferred way of transport for many people in Latvia."
Maris Kreics, CFO of Eleving Group, commented:
"During the third quarter, we continued to deliver strong results in key business areas. The Group generated revenues of EUR 142.5 mln, with a net portfolio of EUR 327.3 mln. The corresponding adjusted EBITDA for this period stood at EUR 58.5 mln, compared to EUR 51.5 mln from the previous year. Furthermore, the adjusted net profit before FX reached EUR 23.5 mln, an increase of EUR 5.3 mln compared to the nine-month period of 2022.
This is the first quarter in which we have fully integrated ExpressCredit into our portfolio and operations. ExpressCredit has contributed to the Group's overall result with an additional net loan portfolio of EUR 26 mln, revenues of EUR 5.0 mln, EBITDA of EUR 2.9 mln, and comprehensive income of EUR 0.4 mln. This is the performance we expected from the newly integrated business, and we remain optimistic about business prospects in the coming quarters.
During the third quarter, a strong emphasis was placed on further diversification of our funding structure. We laid the foundations for the bond issue concluded in October this year, where investors were offered an exchange of Mogo AS 2021/2024 bonds and a subscription for the new Eleving Group 2023/2028 senior secured and guaranteed bonds with a coupon rate of 13%. As a result, Eleving Group issued bonds worth EUR 50 mln with maturity in 2028. Volume-wise, this already is one of the largest corporate public bond offerings carried out in the Baltics in recent years. Additionally, we see this issue as a great success for further diversification of our funding structure, given that we have onboarded close to 2000 new investors from numerous geographies without large single investor concentration. Also, the new bonds will improve our debt maturity profile. We have reached the point where the next significant maturity is three years away, which gives us considerable time to prepare for it.
In the near future, we plan to attract new debt service providers - local and international investors - to diversify our lender base in markets such as Botswana and Namibia. Finally, in Q4, we plan to strategically deploy newly raised proceeds in accordance with Eleving Group's 2023/2028 bond prospectus, mainly to refinance Mogo AS 2021/2024 bonds and to cover other Group liabilities."
Full unaudited consolidated report on the 9M period ended on 30 September: https://eleving.com/investors/
A conference call in English with the Group's management team to discuss the results is scheduled for 14 November 2023 at 15:00 CET.
Link to register for a conference call can be found here.
Arturs Cakars, Group’s Chief Corporate Affairs Officer
About Eleving Group
Eleving Group comprises a number of financial technology companies with a global presence. The Group operates in the vehicle and consumer finance segments on three continents, providing financial inclusion and disruptively changing financial services industries in its countries of operation. Founded in 2012 in Latvia, the Group has revolutionized how people purchase cars. Having expanded across the Baltics within its first year in business, the Group continued expanding in the following years, servicing 16 active markets. With its headquarters in Latvia, the Group operates in the Baltics, Central, Eastern, and South-Eastern Europe, Caucasus, Central Asia, Sub-Saharan and Eastern Africa. For two consecutive years since 2020, the Group has appeared on the Financial Times list of Europe’s 1000 fastest-growing companies.
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