Cembra H1 2019 results Robert Oudmayer, CEO Pascal Perritaz, CFO Volker Gloe, CRO 23 July 2019 Page Cembr bra a Money y Bank
Agenda 1. 1. H1 2019 9 highligh lights ts Robert t Oudmayer er 2. H1 2019 financial results Pascal Perritaz Volker Gloe 3. Outlook Robert Oudmayer Appendix Page 2 23.07.2019 H1 2019 results Cembr bra a Money y Bank
H1 2019 highlights H1 2019 performance Good momentum in auto and continued growth in cards Highlights Net financing receivables Return on equity Target for assets growth: in line with Target ROE: >15% ■ Positive business performance Swiss GDP growth. In CHF mn +4% +4% with net income CHF 78.6mn ■ +5% net revenues with 17.8% 5,023 17.1% 4,807 good momentum in auto and 15% 15 continued growth in cards ■ Strong 0.8% loss rate offsetting 31.12.18 30.6.19 H1 2018 H1 2019 higher 46.5% cost/income ratio Capital adequacy (Tier 1) Dividend Target Tier 1 capital ratio: >17% 2 Target at least CHF 3.75 for FY 2019 ■ +4% receivables growth 1 ■ ROE 17.1% and Tier 1 capital 18.8% above target levels 2 19.2% 3.75 3.75 18.8% 17 17% 31.12.18 30.6.19 FY 2018 FY 2019E 1 Growth including timing effect at end of period (see page 11) 2 2 Tier 1 capital target of 17% since July 2019 (previously 18%) Page 3 23.07.2019 H1 2019 results Cembr bra a Money y Bank
H1 2019 highlights H1 2019 products and markets Personal loans & auto in line with market, cards outperforming Personal loans Auto loans and leases Credit cards Consumer loans market, in CHF bn New car registrations, in 1,000 cars Transaction volumes, in CHF bn (first six months of year) (first four months of year) +5% +5% Market environment +3% +3% +6% +6% -0.5% 162 158 159 158 157 14.8 14.1 7.19 7.06 7.24 7.66 7.91 12.5 11.6 11.1 2015 2016 2017 2018 H1 ’19 2015 2016 2017 2018 2019 2015 2016 2017 2018 2019 Source: ZEK Source: auto-Schweiz Source: SNB April 2019 ■ Net financing receivables +1% ■ Net financing receivables +4% ■ Cards issued +11% year-on-year Cembra H1 2019 in line with leasing market (+4%) to 946,000 ■ Market share at 33% despite ■ Market share stable at 17% ■ Outperforming market growth aggressive competition with market share of 13% ■ Partnerships performing well; ■ 95% of loan book repriced, ■ Strong presence in NFC trans- with E-vehicles growing establishing a new run rate actions with 20% market share ■ All partnerships performing well Page 4 23.07.2019 H1 2019 results Cembr bra a Money y Bank
H1 2019 highlights H1 operational highlights Key investments and projects on track Maintain momentum Invest in the future ■ Maintain ■ Inves ntain posi sitionin tioning in auto busi siness ness esting ting in digi gitisat tisation on on track ack Execution on partnerships ongoing Implemented CRM platform as basis for cross- • • • 4’000 car dealers (+100 since Dec 2018) selling and up-selling • Low risk profile • Ongoing simplification of customer journey and modernisation of customer service platforms ■ Credit • Potential to accelerate digitisation with cashgate t cards growth wth Continuing growth with all • ■ SME E mark rket t entry planned anned for r Q4 2019 partnerships performing well • Online financing for small companies in • Renewed contract with FNAC Switzerland • Partnership signed with Berlin-based Spotcap ■ Swiss to provide the technology platform for wissbil billing ng growth wth the new service Revenues more than doubled in H1 • • Launch planned • Contract with Swisscom Directories for Q4 2019 expected to take effect from January 2020 on ■ Acquisition of cashgate, closing expected at 31 August/30 September 2019 Page 5 23.07.2019 H1 2019 results Cembr bra a Money y Bank
Agenda 1. H1 2019 highlights Robert Oudmayer 2. 2. H1 2019 9 finan ancial cial resu sults lts Pas Pascal l Per errita itaz Volker er Gloe 3. Outlook Robert Oudmayer Appendix Page 6 23.07.2019 H1 2019 results Cembr bra a Money y Bank
H1 2019 financial results P&L % Income statement H1 2019 H1 2018 Comments In CHF mn Interest income 165.8 162.2 2 Higher interest income is in line with growth of 1 financing receivables; higher income in credit Interest expense -10.7 -10.1 6 cards, partly offset by repricing of the personal Net interest income 1 155.1 152.1 2 loan book Insurance income 9.9 9.8 1 Higher interest expenses are related to increased Credit cards 2 48.1 43.2 11 debt (including higher retail deposits) and wider Loans & leases 6.5 6.7 -3 credit spreads Other 3.1 1.2 158 Lower net interest margin mainly driven by Commission and fee income 67.6 60.9 11 decreased yield in personal loans, due to remaining effect of interest rate cap until H1 2019 Net revenues 222.6 213.0 5 Provision for losses 3 -19.2 -23.9 -20 Credit card fees driven by a 9% volume growth, 2 Operating expense 4 -103.6 -90.6 14 resulting from a YoY increase of 11% in number of Income before taxes 99.8 98.5 1 cards and from a YoY increase of 16% in number of Taxes -21.3 -20.8 2 credit card transactions Net income 78.6 77.7 1 Loss rate of 0.8% affected by one-off related to Basic earnings per share (EPS) 2.79 2.76 1 3 synchronisation of write-off and collection procedures. Core loss performance improved due Key ratios to further optimisation of collections strategies in a favourable macro environment Net interest margin 1 6.2% 6.5% Share of fee income/total 30% 29% Increase largely related to strategic and digital 4 investments, combined with core business growth. Loss rate 3 0.8% 1.0% Some pre-transaction costs related to the cashgate Cost/income ratio 4 46.5% 42.6% AG acquisition are included in H1 2019 ROE (annualised) 17.1% 17.8% ROA (annualised) 2.9% 3.0% Page 7 23.07.2019 H1 2019 results Cembr bra a Money y Bank
H1 2019 financial results Net revenues by source +5% growth in H1 2019 In CHF mn Revenue by source Personal loans Auto lease and loans Credit cards Net financing receivables Net financing receivables Net financing receivables +5% +5% +1% +1% +4% +4% +10% 222.6 1,913 2,062 1,036 1,885 213 13.0 1,974 940 67.6 60.9 31.12.18 30.06.19 31.12.18 30.06.19 31.12.18 30.06.19 Yield (2pt avg) and interest income Yield (2pt avg) and interest income Yield (2pt avg) and interest income 8.6% 8.2% 5.0% 4.9% 7.9% 7.7% 0 162.2 165.8 38 4 1 1 1 5 50 79 79 1 0 49 4 34 -10.1 -10.7 H1 ’18 Volume Rate Other H1 ’19 H1 ’18 Volume Rate Other H1 ’19 H1 ’18 Volume Rate Other H1 ’19 H1 2018 H1 2019 Interest income Commission and fees Interest expense Page 8 23.07.2019 H1 2019 results Cembr bra a Money y Bank
H1 2019 financial results Operating expenses H1 2019 H1 2018 % Income statement Comments In CHF mn 10% year-on-year increase in FTE for organic Compensation and benefits 1 56.9 52.8 8 1 growth and business expansion Professional services 2 8.8 7.4 19 Driven by strategic initiatives and technology Marketing 3 4.7 4.4 7 2 investments as well as pre-transaction Collection fees 5.2 5.4 -4 costs related to the cashgate acquisition Postage and stationary 4 4.9 4.3 14 Driven by non-recurring 2018 benefits 3 Rental expenses (under operating leases) 5 3.2 2.3 39 Information technology 6 14.4 9.6 50 Driven by growth in the number of accounts 4 Depreciation and amortisation 6.8 6.6 3 Increase related to one-off costs for closure of 5 Other 7 -1.3 -2.2 -41 branches and additional space required for Total operating expenses 103.6 90.6 14 business expansion Driven by CHF 3.6mn reimbursement for the 6 Cost / Income ratio 46.5% 42.6% cancellation of the data centre sourcing project in 2018, and increase due to investments in IT and project releases Full-time equivalent employees 1 1 812 741 10 Primarily driven by CHF 0.7mn higher pension 7 Cembra Money Bank 782 721 8 costs resulting from asset performance revaluation Swissbilling 30 20 50 1 1 End of period Page 9 23.07.2019 H1 2019 results Cembr bra a Money y Bank
H1 2019 financial results Balance sheet 30.06.19 31.12.18 % Assets Comments In CHF mn Cash decreased due to business growth and 1 Cash and equivalents 1 414 499 -17 dividend payment in April 2019 Net financing receivables 2 5,023 4,807 4 Net financing receivables were up due to growth Personal loans 1,913 1,885 1 2 across all products related to strong originations as Auto leases and loans 2,062 1,974 4 well as lower repayments Credit cards 1,036 940 10 Timing effect of incoming payables lead to growth Other (Swissbilling) 11 8 38 of net financing receivables at end of period (growth by end of May 2019 was 2.1%) Other assets 153 134 14 Total assets 5,590 5,440 3 Increase in funding to support asset growth 3 Liabilities Equity lower due to dividend payment in April 2019, 4 partly compensated by H1 2019 net income In CHF mn Funding 3 4,499 4,325 4 Deposits 2,953 2,827 4 Short- & long-term debt 1,547 1,498 3 Other liabilities 184 182 1 Total liabilities 4,683 4,507 4 Shareholders’ equity 4 907 933 -3 Total liabilities and equity 5,590 5,440 3 Page 10 23.07.2019 H1 2019 results Cembr bra a Money y Bank
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