REG - ZAIM Credit Systems - Fourth quarter and full year 2021 trading update

Adalan VenturesAnnouncement

14/03/2022 07:30

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RNS Number : 6381E  ZAIM Credit Systems PLC  14 March 2022

For Immediate Release

14 March 2022

Zaim Credit Systems Plc

("Zaim" or the "Group")

Fourth quarter and full year 2021 trading update

Zaim Credit Systems plc (the 'Group' or 'Zaim'), the Russian focused fintech
group, announces a post period end trading update from its wholly owned
subsidiary, Zaim-Express LLC, ('Zaim Express') in respect of the fourth
quarter and the full year ended 31 December 2021.

 

Fourth Quarter 2021 Highlights ( )(1)( ):

·    Strong quarterly performance with impressive growth in loans issued
both on quarter-on-quarter (14%) and year-on-year (105%) basis to £7.8m for
Q4 21

·    Loans issued online reached £7.2m growing by 18% quarter-on-quarter
and 148% year-on-year

·    Online continuing to be the key engine for growth representing 92% of
loans issued; and

·    The Group continued to trade profitably in Q4 2021

 

Full Year 2021 Highlights:

·    First full year completing the successful transition from offline to
online-focused business model with a lower fixed costs base and greater
flexibility

·    Increase in loans issued to £26.0m representing unprecedented
growth of 154% vs. 2020

·    Growth of loans issued online to £23.1m, which is 4.9 times higher
than in 2020

·    Decrease in loans issued offline by 47% to £2.9m due to closure of
stores and transition to online-focused business model

·    Increase in weighted average default rate for the first nine months
of 2020 to 22.7% (2020: 14.1%) in line with management expectations due to
greater portion of first-time clients. This is a direct result of the rapid
growth of the online business.

Siro Cicconi, Zaim's CEO commented:

"It is very hard talking about business in such unprecedented and difficult
times. Despite this we are firmly committed to adhering to all our duties to
our stakeholders and our customers. These results show that the fourth quarter
of 2021 became the sixth consecutive quarter of profitable growth. Our
operational results demonstrate the effectiveness of the online-focused
strategy that we employed in the middle of 2020.

We are significantly overperforming a very fast-growing market: the Russian
microfinance market grew by 35% year-on-year( 2 ), whilst the amount of loans
issued by Zaim Express more than doubled ( 3 ). We are investing in growth,
being careful to maintain cash generation and profitability.

 

Quarter-on-quarter growth remains strong at 14%, showing acceleration vs. the
previous quarter.

 

The business continues to be cash-generative, which we are carefully
reinvesting in order to serve a wider base of clients with our online
business. Our online-focused strategy allows for lower fixed costs and faster
growth that makes us confident in the long-term development of our business.
Our investment in our proprietary platform and process delivered impressive
results and I would like to thank the whole team for their dedication in these
uncertain times."

Fourth quarter 2021 trading update

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

 

 Quarter Ended                         Dec-20  March-21  June-21  Sept-21  Dec-21
 Loans Issued (£'000)                  3,812   5,109     6,332    6,830    7,813

 Loans Issued Growth Rate QoQ          65%     34%       24%      8%       14%
 Loans Issued Online (£'000)           2,889   4,308     5,564    6,097    7,173
 Loans Issued Online Growth Rate QoQ   151%    49%       29%      10%      18%
 Loans Issued Offline (£'000)          923     801       768      733      641
 Loans Issued Offline Growth Rate QoQ  (20%)   (13%)     (4%)     (5%)     (13%)
 Weighted Average Default Rate( 4 )    17.7%   20,8%     24.5%    22.7%    See note( 5 )

 

Zaim Express continued to see strong growth in loans issued by 14%
QoQ, driven by expansion of the online platform.

The weighted average default rate decreased slightly to 22.7% in Q3 as a
result of more conservative approach to the credit scoring in line with the
management expectations.

 

Loans issued for the financial year:

 Full Year Ended        Dec 20   Dec 21   Change
 Loans Issued Online    £4.8m    £23.1m   386.4%
 Loans Issued Offline   £5.5m    £ 2.9m   (46.5%)
 Total Loans Issued     £10.3m   £26.0m   154.2%

 

The Company looks forward to releasing its audited results for the year-ended
31 December 2021 in due course.

 

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 portfolio of microloans in Q3 2021 was 35% compared to Q3 2020

 

(3) Loans issued by Zaim Express in Q4 2021 increased by 105% vs. Q4 2020

(

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

(5 )Data is not yet available for the quarter ended 30 September 2021 as the
earliest time to determine default rates is 120 days after the end of the
period

 

 

*Ends*

 

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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

 Investor Relations: Flowcomms Ltd
 Sasha Sethi                         Tel: +44 (0)7891 677441

                                     sasha@flowcomms.com (mailto:sasha@flowcomms.com)

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

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

 

 

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