REG - ASA Intnl. Grp PLC - August 2020 business update
August 2020 business update and revised date for interim results
Amsterdam, 16 September 2020 - ASA International, ("ASA International", the "Company" or the "Group"), one of the world's largest international microfinance institutions, today provides the following update of the impact of COVID-19 on its business operations during the month of August 2020.
· The immediate health impact of COVID-19 on the Company's operations remains low.
· Liquidity continues to remain high with approximately USD 105m of unrestricted cash and cash equivalents across the Group on 31 August 2020.
· The pipeline of funding deals under negotiation totals approximately USD 220m.
· Collection efficiency remained in the mid to high nineties in eight operating countries, which in the aggregate represented more than 70% of the pre-tax profitability of all the Group's country operations in 2019.
· Disbursements as percentage of collections in August exceed 100% in most countries with the exception of India, Pakistan, the Philippines, Uganda and Rwanda.
· As a result, the number of clients and OLP stabilized and started to gradually increase in many operating countries.
· The aggregate Moratorium amounts to USD 40.7m, which represents 10% of the Group's outstanding loan portfolio ("OLP") and is primarily concentrated in India (37% of the aggregate Moratorium), the Philippines (28%), Kenya (12%) and Uganda (11%).
· The Company has followed guidance from the FCA and FRC on corporate reporting timetables in light of COVID-19 and is now proposing to publish its 2020 interim results on 14 October and not 22 September 2020 as originally planned. This will enable the Company to provide a better assessment of the quality of the Group's loan portfolio and any proposed ECL provision to reflect the impact of COVID-19.
Health impact of COVID-19 on our communities
· As of 31 August 2020, the immediate health impact of COVID-19 on the Company's operations remains low with 28 of our 12,535 staff members confirmed as infected, but with no deaths. The number of confirmed infections amongst our 2.3m clients increased from 176 at end of July to 303 as at 30 August 2020, resulting in 17 deaths until now.
· While the infection rate in our operating countries continues to increase, the speed of growth and the absolute number of confirmed infections and, in particular, the number of deaths remain relatively low in comparison to Europe, USA and Latin America. This is illustrated by the relatively few deaths in each of our operating countries as percentage of the size of the population which ranges between zero to 47 deaths per million population in our operating countries compared to 363 to 846 deaths per million in the U.S.A., Mexico, Brazil and the wealthiest European countries.
Funding
· Unrestricted cash and cash equivalents remain high at approximately USD 105m on 28 August 2020.
· The Company secured approximately USD 2m of new loans from local and international lenders in August 2020.
· About 72% of the Company's USD 220m pipeline of future wholesale loans are supported by (agreed) term sheets and/or draft loan documentation. The terms and conditions of the remaining 28% are being negotiated with lenders.
Collection efficiency until 29 August 2020 (1)
Country
7 June -13 June
14 June -20 June
21 June -27 June
28 June -4 July
5 July-11 July
12 July-18 July
19 July-25 July
26 July-31 July
01 Aug-07 Aug
08 Aug-14 Aug
15 Aug-22 Aug
23 Aug-29 Aug
India
37%
40%
47%
50%
53%
49%
41%
37%
41%
49%
53%
58%
Pakistan
95%
92%
94%
95%
97%
96%
96%
95%
96%
96%
96%
94%
Sri Lanka
66%
93%(2)
91%
95%
91%
90%
93%
94%
93%
92%
95%
95%
Myanmar
95%
95%
97%
95%
96%
96%
97%
97%
96%
96%
97%
97%
The Philippines
64%
66%
69%
74%
71%
72%
73%
74%
70%
65%
65%
67%
Ghana
99%
100%
100%
100%
99%
99%
99%
101%
101%
100%
99%
99%
Nigeria
93%
94%
94%
95%
91%
91%
89%
94%
90%
94%
90%
90%
Sierra Leone
94%
95%
98%
101%
97%
95%
100%
102%
94%
96%
96%
97%
Kenya
71%
76%
88%
88%
78%
73%
72%
75%
69%
73%
70%
74%
Tanzania
98%
98%
98%
99%
99%
99%
99%
99%
100%
98%
98%
98%
Uganda
22%
33%
40%
41%
46%
44%
47%
53%
57%
63%
63%
63%
Rwanda
77%
79%
83%
82%
84%
82%
88%
89%
88%
89%
86%
82%
Zambia
98%
98%
98%
99%
98%
98.4%
99%
99%
99%
99%
99%
99%
(1) Collection efficiency refers to actual collections from clients divided by expected collections for the period; since any moratorium on the repayment of loans are only granted to clients after the end of the month, the collection efficiency is not affected by the grant of such moratorium;
(2) Sri Lanka improved due to a write-off of overdue loans caused by the Government imposed debt relief program and Easter Sunday Bombings
· Collection efficiency across the Group remained in the mid to high nineties in 8 out of 13 operating countries.
· In India collection efficiency gradually increased to 58% prior to the end of the government-imposed moratorium, and further increased to 78%, excluding any overdue collection, during the first two weeks in September.
· Due to increased infection rates and the associated disruption in the Philippines, collection efficiency reduced by approximately 5% to 67%.
· Kenya was not able to substantially improve collection efficiency yet, keeping it relatively steady at 69-74%.
· Uganda succeeded in substantially improving its collection efficiency from 41-53% in July to 57-63% in August.
Disbursements vs collections of loans until 29 August 2020(3)
· With the business environment gradually improving, disbursements of fresh loans continued to increase in amount and as a percentage of weekly collections in almost all countries in August.
Country
7 June-13 June
14 June-20 June
21 June-27 June
28 June-4 July
5 July-11 July
12 July-18 July
19 July-25 July
26 July-31 July(4)
01 Aug-07 Aug
08 Aug-14 Aug
15 Aug-22 Aug
23 Aug-29 Aug
India
Nil
1%
8%
12%
25%
37%
74%
61%
54%
70%
78%
74%
Pakistan
60%
60%
60%
68%
79%
82%
87%
88%
72%
85%
90%
91%
Sri Lanka
12%
43%
52%
27%
101%
57%
40%
71%
8%
74%
128%
145%
Myanmar
61%
68%
71%
68%
76%
80%
95%
62%
73%
101%
114%
122%
The Philippines
19%
40%
61%
46%
80%
69%
70%
73%
57%
51%
70%
79%
Ghana
109%
105%
105%
128%
130%
107%
110%
116%
120%
120%
112%
117%
Nigeria
70%
82%
84%
78%
102%
103%
116%
86%
67%
96%
104%
104%
Sierra Leone
85%
91%
99%
66%
122%
101%
113%
93%
110%
131%
139%
97%
Kenya
63%
56%
67%
70%
74%
84%
67%
76%
85%
87%
99%
101%
Tanzania
52%
65%
70%
76%
83%
118%
123%
113%
104%
121%
116%
112%
Uganda
N/A
N/A
1%
15%
46%
51%
32%
42%
75%
78%
69%
Rwanda
106%
113%
101%
92%
98%
52%
98%
108%
88%
93%
79%
87%
Zambia
91%
113%
89%
68%
199%
160%
176%
157%
136%
184%
181%
188%
(3) Disbursements vs collections refers to actual loan disbursements made to clients divided by total loans collected from clients in the period; (4) Slowdown of branch operations due to official EID holidays in latter part of this week.
Development of Clients and Outstanding Loan Portfolio
· With disbursement gradually increasing in many operating countries, OLP increased to USD 412m (up 1%) in August 2020.
Clients (in thousands)
Delta
OLP (in USDm)
Delta
Countries
Dec/19
Jul/20
Aug/20
Dec- Aug
Jul - Aug
Dec/19
Jul/20
Aug/20
Dec - Aug USD
Dec - Aug CC
Jul - Aug USD
India
732
713
707
-3%
-1%
181.9
167.3
169.4
-7%
-4%
1%
Pakistan
439
405
397
-9%
-2%
62.5
54.0
52.8
-16%
-9%
-2%
Sri Lanka
63
54
56
-12%
2%
9.4
8.4
8.5
-9%
-7%
1%
Myanmar
152
136
136
-10%
0%
31.5
30.1
31.0
-2%
-11%
3%
The Philippines
340
297
284
-17%
-4%
52.7
46.5
45.0
-15%
-18%
-3%
Ghana
165
141
142
-14%
1%
41.6
35.7
37.6
-10%
-8%
5%
Nigeria
260
213
215
-17%
1%
32.7
23.8
23.5
-28%
-23%
-1%
Sierra Leone
34
30
31
-10%
2%
2.9
3.2
3.6
23%
23%
12%
Kenya
101
79
80
-21%
0%
17.6
11.9
12.0
-32%
-27%
1%
Tanzania
123
100
101
-18%
1%
20.5
16.1
17.5
-14%
-14%
9%
Uganda
101
93
90
-11%
-3%
10.4
8.5
8.1
-22%
-22%
-4%
Rwanda
21
19
19
-9%
-2%
3.0
2.7
2.7
-10%
-8%
-1%
Zambia
2
4
4
89%
6%
0.2
0.3
0.4
106%
185%
19%
Total
2,533
2,286
2,261
-11%
-1%
467
408
412
-13%
-10%
1%
Selected moratorium on loan repayments
· Clients and OLP under moratorium continued to increase in India, the Philippines, Uganda and Rwanda in August, but overall by substantially reduced amounts.
Clients under moratorium
As % of
Countries
March
April
May
June
July
August
Total Clients
India
0
0
0
182,318
181,878
165,618
23%
Pakistan
0
0
0
0
0
0
0%
Sri Lanka
0
0
0
37,891
9,002
78
0%
Myanmar
2,307
2,101
35,056
12,394
7,876
15,308
11%
The Philippines
1,297
0
57,130
145,086
65,405
60,373
21%
Ghana
0
0
0
0
0
0
0%
Nigeria
0
0
4,042
10,523
9,763
0
0%
Sierra Leone
0
91
1,225
1,336
1,178
0
0%
Kenya
20,453
17,366
9,660
7,778
26,697
0
0%
Tanzania
0
194
5,323
4,162
0
0
0%
Uganda
8,269
0
0
75,360
59,563
49,897
55%
Rwanda
436
0
7,746
7,886
4,703
2,800
15%
Zambia
0
0
0
0
0
0
0%
Total
32,762
19,752
120,182
484,734
366,065
294,074
13.0%
Moratorium amounts (in USD thousands)
As %
As % of Total Moratorium
Countries
March
April
May
June
July
August
Total
of OLP
India
0
0
0
5,831
5,414
3,690
14,935
9%
37%
Pakistan
0
0
0
0
0
0
0
0%
0%
Sri Lanka
0
0
0
1,150
247
2
1,399
16%
3%
Myanmar
40
42
700
332
242
391
1,747
6%
4%
The Philippines
16
0
929
6,262
2,115
1,996
11,318
25%
28%
Ghana
0
0
0
0
0
0
0
0%
0%
Nigeria
0
0
135
459
425
0
1,019
4%
3%
Sierra Leone
0
1
11
20
21
0
52
1%
0%
Kenya
679
434
2,158
734
811
0
4,817
40%
12%
Tanzania
0
5
147
115
0
0
266
2%
1%
Uganda
77
0
0
1,728
1,562
1,176
4,543
56%
11%
Rwanda
5
0
163
221
126
76
590
22%
1%
Zambia
0
0
0
0
0
0
0
0%
0%
Total
817
482
4,242
16,850
10,964
7,330
40,685
9.9%
100.0%
As of 31 August 2020, total moratorium on loan repayments granted to clients amounted to USD 40.7m, which represents 9.9% of the Group's OLP.
· The aggregate number of clients benefiting from a moratorium and the total amount of moratorium granted has gone down from 485K and USD 16.7m in June to 366K and USD 10.8m in July, and 294K and USD 7.3m in August. It is expected that this trend line will continue.
· Despite the increased disruption caused by COVID-19, the moratorium granted to clients in the Philippines went down in August from 65K clients and USD 2.1m by the end of July to 60K clients and USD 2.0m at the end of August.
· India's moratorium amounts to USD 14.9m, which represents 37% of the total moratorium amount and is artificially high, because the Indian Government allowed each client to opt for a moratorium at no additional (reputational) cost to the client until the end of August this year. However, following the end of the government-imposed moratorium by the end of August, collection efficiency has continued to increase during the August and the first weeks of September, which is expected to lead to the gradual collection of outstanding moratorium amounts as well.
Enquiries:
ASA International Group plc
Investor Relations +31 6 2030 0139
Véronique Schyns vschyns@asa-international.com
About ASA International Group plc
ASA International is one of the world's largest international microfinance institutions, with a strong commitment to financial inclusion and socioeconomic progress. The company provides small, socially responsible loans to low-income, financially underserved entrepreneurs, predominantly women, across South Asia, South East Asia, West and East Africa.
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