- Seasonally strong fourth quarter, business activity not impacted by Omicron
- Continued positive economic sentiment, despite inflationary pressures and supply chain challenges
- Significant client wins and retentions, including a transformational CMS deal in the UK
- Delivery on key priorities; transformation program and organic growth
- Acceleration of case migrations and increase in global front office utilisation
- Scalability of the operating platform visible with robust cash revenue growth and stable cash costs driving margin expansion
Financial results in brief, October-December 2021 (October-December 2020)
- Adjusted EBIT increased to SEK 2,355 M (1,611)
- Cash EBIT increased to SEK 2,171 M (1,523)
- Q4 cash EPS increased to SEK 13.93 (9.00)
- Q4 cash RoIC increased to 12.0 per cent (8.7)
- Available liquidity at the end of the quarter was SEK 19.5 bn (17.1)
Full year 2021 (full year 2020)
- Adjusted EBIT increased to SEK 7,014 M (5,738)
- Cash EBIT increased to SEK 6,343 M (5,580)
- Cash EPS increased to SEK 28.98 (25.28)
- Cash RoIC increased to 8.9 per cent (7.7)
- Net debt/Full year cash EBITDA was 3.9x (4.0x)
The Board of Directors of Intrum AB proposes that the Annual General Meeting distributes a dividend to the shareholders of SEK 13.50 per share (12.00), corresponding to a total of SEK 1,631 M (1,450).
Presentation of year-end announcement
Anders Engdahl, President & CEO and Michael Ladurner, CFO, will present the results and answer questions in an audio cast with telephone conference at 9:00 a.m. CET. The conference will be held in English. To listen in, please dial:
+46 8 519 993 83 (SE)
+44 333 300 9264 (UK)
+1 646 722 4902 (US)
Comment by President & CEO Anders Engdahl
“For 2021 we saw growth of cash revenues of 4 per cent, also driven by a seasonally strong fourth quarter that has not been impacted by the Omicron variant. For the same period cash EBITDA grew by 6 per cent and cash EBIT by 14 per cent, demonstrating the operating leverage of the business.
Within the Credit Management Services segment’s gradual normalisation of new case inflows continues into the fourth quarter with improving inflows across the board, also in higher value financial services claims and the trend is set to extend into 2022. Our focus on client value proposition combined with high commercial activity has enabled us to win key new and retain important existing clients. Amongst others, Intrum UK won a transformational mandate from a major retail bank covering the outsourcing of the collections and recoveries functions for the bank.
For our Strategic Markets we observe a broad-based and sharp recovery from the pandemic, with a very strong finish to 2021. In Spain, particularly our real estate activities performed strongly with SEK 3.7 bn of RE sales in the fourth quarter and SEK 12.8 bn for 2021, which represents approximately 2.4 per cent of all pre-owned real estate sales in the country. In Italy we have seen normalisation of legal system effectiveness during the fourth quarter with significant opportunities for further growth, particularly in the UtP (Unlikely to Pay) area, with SEK 53 bn of AuM (asset under management) added to the platform in 2021. In Greece, the trajectory of strong performance continues.
The Portfolio Investments segment had record gross cash collections of SEK 11.8 bn (11.0) and a return to growth in terms of capital deployed of SEK 8.1 bn (5.1) at attractive returns for the full year 2021. The segment has significantly outperformed expectations during the year. Going forward we expect to continue to deploying capital in line with our double digit organic growth target.
The transformation towards ONE Intrum has progressed with significant operating leverage. Optimising resource allocation and focus on the modern, common platforms has enabled increased cash revenues by 10 per cent compared to pre-pandemic level, while keeping cash spend flat between 2019 and 2021. We end 2021 with four global front offices, covering 15 markets and c. 16 per cent of all Intrum calls globally per month. During 2021 we have also accelerated case migrations to the new operating platform, it is now our largest collection system and represents c. 20 per cent of all Intrum cases.
Our sustainability agenda is advancing towards the strategic targets. I am happy to see that both Intrum’s client satisfaction index – as well as our employee engagement index has increased for the third consecutive year, reaching the highest level to date. During the autumn we have completed a Human Rights Due Diligence in alignment with the United Nations Guiding Principles on Business and Human Rights, and we are now defining actions to mitigate risks.
Looking into 2022, our two key priorities remain unchanged – we will continue to deliver on transformation and organic growth. We foresee further normalisation in the CMS segment, boosted by our 2021 commercial successes starting to contribute as well as exploiting economies of scale of the ONE Intrum platform. In 2022 we expect a return of a normal seasonal pattern, with relatively weaker first and third quarters and stronger second and fourth quarters.”