REG - ZAIM Credit Systems - First quarter 2022 trading update

Adalan VenturesAnnouncement

22/06/2022 07:00

For best results when printing this announcement, please click on link below:
http://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20220622:nRSV6700Pa&default-theme=true

RNS Number : 6700P  ZAIM Credit Systems PLC  22 June 2022

For Immediate Release

22 June 2022

Zaim Credit Systems Plc

("Zaim" or the "Group")

First quarter 2022 trading update

Zaim Credit Systems plc (the 'Group' or 'Zaim'), the fintech group, announces
a trading update from its wholly owned subsidiary, Zaim-Express LLC, ('Zaim
Express') in respect of the first quarter of the financial year ended 31
December 2022.

 

First Quarter 2022 Highlights( )(1)( ):

 

·    Strong quarterly performance with continued growth of the key
business metrics both quarter-on-quarter and year-on-year.

·    Loans issued grew by 5% quarter-on-quarter and 61% year-on-year basis
to £8.2m. On a constant currency basis, Loans issued increased by 24%
quarter-on-quarter and 81% year-on-year

·    Loans issued online reached £6.9m growing by 6% quarter-on-quarter
and 60% year-on-year, which corresponded with 25% and 80% growth on constant
currency basis respectively

·    Loans issued via mobile application launched in Q2 2021 increased by
28% quarter-on-quarter to £0.9m in Q1 2022 or by 49% on constant currency
basis (no year-on-year comparison)

·    Significant foreign exchange fluctuations between the functional
currency and the reporting currency were observed during Q1, these moves
reversed during Q2. Constant currency comparisons are presented to assist the
presentation

·    Online and mobile segments continuing to be the key engines for
growth representing 84% and 10% of loans issued respectively

 

Siro Cicconi, Zaim's CEO commented:

"Despite the economic volatility the business performance of the Group
remained strong, demonstrating the seventh consecutive quarter of growth.

As our operating currency is the Russian rouble and reporting currency is the
British pound, the fluctuation of exchange rate of these currencies affects
our reported performance.

Even with this negative influence of the forex rates our business continued to
grow both on quarter-on-quarter (5% in GBP terms and 24% on constant currency
basis) and year-on-year (61% in GBP terms and 81% on constant currency basis).
We are significantly overperforming a very fast-growing market: the Russian
microfinance market grew by 37% year-on-year( 2 ) on constant currency basis
(22% in GBP terms). In Q2 2022 we saw the reversal of the forex trend with
Russian rouble significantly strengthening vs. British pound, which will
positively influence our reported numbers in the second quarter of 2022.

 

In Q2 2021 we launched our branded mobile application that became an important
sales channel and significant growth driver of our business. In Q1 2022 the
mobile application was responsible for over 10% of loans issued, which now
represents a significantly larger proportion than our physical store business"

First quarter 2022 trading update (5)

The table below presents the two main KPI's (loans issued and default rate)
for the last five quarters:

 

 Quarter Ended                                        March-21  June-21  Sept-21  Dec-21   March-22
 Loans Issued (£'000)                                 5,109     6,332    6,830    7,813    8,225

 Loans Issued Growth Rate QoQ                         34%       24%      8%       14%      5%
 Loans Issued Online (£'000)                          4,308     5,405    5,677    6,501    6,909
 Loans Issued Online Growth Rate QoQ                  49%       25%      5%       15%      6%
 Loans Issued via Mobile Application (£'000)          -         158      420      671      860
 Loans Issued via Mobile Application Growth Rate QoQ  -         n/a      167%     60%      28%
 Loans Issued Offline (£'000)                         801       768      733      641      456
 Loans Issued Offline Growth Rate QoQ                 (13%)     (4%)     (5%)     (13%)    (29%)
 Weighted Average Default Rate( 3 )                   20,8%     24.5%    22.7%     21.9%   See note( 4 )

 

In order to eliminate the effect of GBP/RUB fluctuations on the financial
results of Zaim Express, below is the table of loans issued on constant
currency basis. For the purpose of this calculation average GBP/RUB exchange
rate for Q1 2021 (102.5048) is used.

 

 Quarter Ended                                        March-21  June-21  Sept-21  Dec-21  March-22
 Loans Issued (£'000)                                 5,109     6,407    6,752    7,461   9,250

 Loans Issued Growth Rate QoQ                         37%       29%      3%       11%     24%
 Loans Issued Online (£'000)                          4,308     5,471    5,612    6,202   7,770
 Loans Issued Online Growth Rate QoQ                  52%       27%      3%       11%     25%
 Loans Issued via Mobile Application (£'000)          -         159      415      647     967
 Loans Issued via Mobile Application Growth Rate QoQ  -         n/a      161%     56%     49%
 Loans Issued Offline (£'000)                         801       777      725      612     513

 Loans Issued Offline Growth Rate QoQ                 (12%)     (3%)     (7%)     (16%)   (16%)

 

Zaim Express continued to see growth in loans issued by 5% QoQ (24% on
constant currency basis), driven by expansion of the online and mobile
platforms and funded from its existing cash resources. Group policy remains to
operate the Company and Zaim Express as two self-funded entities.

The weighted average default rate decreased slightly to 21.9% in Q4 as a
result of more conservative approach to the credit scoring in line with the
management expectations.

 

Notes:

 

(1) All figures presented throughout this announcement represent unaudited
management information taken from the internally generated management accounts
of Zaim-Express LLC

( )

(2) According to the Central Bank of Russia's latest available data, growth
of the in the loans issued in Q1 2022 was 37% compared to Q1 2021

 (

3 )Default rate is defined as no payment received after 120 days of the
origination of the loan

(4 )Data is not yet available for the quarter ended 31 March 2022 as the
earliest time to determine default rates is 120 days after the end of the
period

(5) Starting from our Q1 2022 trading update we are introducing the new
reporting segment - "Loans issued via mobile application". Starting from Q2
2021 loans issued via mobile application were accounted within "Loans Issued
Online" category. In the table below loans issued via mobile application for
Q2 2021 to Q4 2021 are deducted from the previously reported loans issued
online, which explains the difference in the numbers of loans issued online
compared with previously reported for the respective periods

 

*Ends*

 

Follow us on Twitter - @ZaimcreditSyst

Sign up for our Newsletter -  https://tinyurl.com/4jjuuwve
(https://tinyurl.com/4jjuuwve)

 

Enquiries:

 Zaim Credit Systems Plc
 Simon Retter

 Siro Cicconi                         Tel: +44 (0) 73 9377 9849
 Alex Boreyko                         Tel: +7 925 708 98 16

                                      investors@zaimcreditsystemsplc.com

 Adviser: Beaumont Cornish Limited
 Roland Cornish / James Biddle        Tel: +44 (0) 20 7628 3396

 Optiva Securities Limited
 Vishal Balasingham                   Tel: +44 (0) 20 3137 1902

 

 

The information contained within this announcement is deemed by the Company to
constitute inside information as stipulated under the Market Abuse Regulations
(EU) No. 596/2014 ("MAR").

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact
rns@lseg.com (mailto:rns@lseg.com)
 or visit
www.rns.com (http://www.rns.com/)
.

RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our
Privacy Policy (https://www.lseg.com/privacy-and-cookie-policy)
.   END  TSTBKDBQBBKDDAB