REG - JSC Kaspi.kz - 1st Quarter 2023 Financial Results

Kaspi.kz AOAnnouncement

24/04/2023 07:15

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RNS Number : 1948X  JSC Kaspi.kz  24 April 2023

 

 

Kaspi.kz First Quarter 2023 Financial Results

Almaty, Kazakhstan, 24 April 2023 - JSC Kaspi.kz ("Kaspi.kz", "we", or the
"Company") which operates the Kaspi.kz and Kaspi Pay Super Apps, today
publishes its unaudited consolidated IFRS financial results for the quarter
ending 31 March 2023.

First quarter 2023 highlights

·    Average monthly transactions per active consumer up 20%
year-over-year to 64.

·    To drive transactions even higher, over the last three years we have
prioritised onboarding as many merchants, as rapidly as possible. Now our
focus is evolving as we aim to increase transaction intensity between
consumers and merchants. RTPV transactions increased 56% year-over-year and
Total GMV purchases increased 71%.

·    e-Grocery, in partnership with Magnum, is seeing strong momentum and
extremely positive consumer feedback.

o  e-Grocery GMV up 5.7x, purchases up 4.3x and consumers up 5.5x
year-over-year.

o  Plan to invest around KZT20-25 billion per annum over the next 3 years, on
track and unchanged.

·    Kaspi B2B Payments continues to prove itself as a transformative
payments proposition for merchants and their suppliers, with RTPV transactions
up 2.5x year-over-year. B2B Payments can be the start of a long list of
innovative B2B services.

·    The breadth and depth of Marketplace's product proposition
significantly enhanced.

o  e-Commerce SKUs up 2.0x year-over-year to 3.1 million.

o  International package holidays now available on Kaspi Travel.

·    We continue to scale Kaspi Smart Logistics Platform, with total
orders delivered up 232% year- over-year to 7.7 million.

o  92% of deliveries free for the consumer.

o  49% of orders delivered in ≤2 days.

o  3,980 Kaspi Postomats operational in March 2023 across 102 towns &
cities, accounting for 37% of orders delivered. Around 6,000 lockers planned
by end-2023.

·    First quarter 2023 financials strong, with consolidated Kaspi.kz
revenue up 53% and adj. net income up 52% year-over-year.

·    60% of first quarter 2023 adj. net income from our Payments and
Marketplace Platforms. Share of contribution from Fintech Platform will keep
reducing.

·    Preparation for a US listing commenced, subject to market conditions.

·    Long-term capital allocation policy unchanged.

o  GDR repurchase program of up to $100 million launched in March.

o  Based on our first quarter 2023 results, our Board of Directors has
proposed a dividend of KZT750/GDR, subject to shareholder approval.

·    At our full-year 2022 financial results in February, we provided
detailed 2023 KPIs and financial guidance. Since then, trading has remained
strong. As previously flagged, we continue to expect year-over-year growth to
be 1H and especially 1Q weighted for Marketplace GMV and Fintech TFV, with
significantly higher funding costs and ongoing macro volatility likely to
remain themes. Notwithstanding, we expect to once again deliver good operating
and financial results in 2023.

To the shareholders of Kaspi.kz:

 

I'm pleased to report that 2023 has got off to a great start. Our consumers
and merchants are transacting more and more with us, resulting in strong
top-line momentum across all our platforms. However, as you know we've never
just been a top-line growth story and our Super App business model is designed
to ensure as much growth and revenue as possible drops through to the
bottom-line. First quarter 2023 adj. net income growth of 52% year-over-year,
isn't too bad in this regard.

 

In every update since our IPO, I've told you that growing our merchant base is
our top strategic priority and I think we've delivered. In first quarter of
2023, the number of merchants increased 75% year-over-year to over 500k. This
is a remarkable achievement by our team, keeping in mind that we had around
30k merchants just three years ago. In 2023 and beyond we still expect strong
growth in new merchants, but now our focus and priority N1 is to grow
transactions between consumers and merchants. You can see that this is already
happening, with Total GMV and RTPV transactions up 71% and 56% year-over-year
respectively and monthly transactions per consumer hitting 64 in the first
quarter. Our consumers transact through us 2x per day on average, which is
best-in-class by global standards and testament to the relevance of our
products to the consumers and merchants who use them.

 

With a large and engaged user base in place, higher transaction intensity is a
function of having a broad and growing suite of top-quality, highly relevant,
consumer and merchant products. At our full-year 2022 results, we provided
cohort analysis, that showed all users, both old and new, are showing no signs
of slowing when it comes to transacting on our core Payments and Marketplace
Platforms. With new product development extending the role we play, we think
growth will remain rapid for many more years to come.

e-Grocery is a great example of this. During the first quarter of 2023,
e-Grocery transactions increased 4.3x year-over-year to almost 1 million.
Currently we operate 3 dark stores in Almaty and Astana, with plans to add
another 2 later this year. We keep fine-tuning e-Grocery's customer
proposition and operating business model and as we go into 2024, we'll
gradually start to open more dark stores, in more cities. Our team knows how
to execute and our partner Magnum gives us the best food retail expertise in
Kazakhstan. Together we see a lot of potential to create value and as always
our goal is not just growth at any cost, but to build a leading and profitable
e-grocery business, that is loved by our consumers.

Other early-stage products that will grow in importance over the next few
years include advertising, a raft of services by Kaspi Delivery, B2B Payments,
Kaspi Classifieds and SME financing. All these products are ultimately aimed
at driving more transactions and address large market opportunities, that
remain underdeveloped. We will also continue to launch new services and our
product pipeline in 2023 and beyond looks good.

At our full-year 2022 financial results just 2 months ago, we provided
detailed 2023 KPIs and financial guidance. Even considering significantly
higher funding costs and ongoing macro volatility, we continue to expect
strong and profitable growth. All in all, we remain on track to deliver a good
2023 and are upbeat about our mid-term growth prospects.

At our last update, I said that nothing has changed in terms of our long-term
approach to the allocation of capital. Investing in our growth, be it organic
or via M&A is always the first use for the cash we generate. However, if
we have excess capital we will return it to our shareholders. Here too, the
numbers speak for themselves, as we approach a near 3-year track record of
returning substantial amounts of capital. Following the first quarter of 2023,
our Board of Directors and subject to shareholder approval, has approved a
dividend equivalent to KZT750/GDR. We also continue to buyback our own GDRs
and in March launched a new up to $100 million buyback program.

Our commitment to ensuring Kaspi.kz is listed on the most appropriate exchange
also remains unchanged. External factors made this impossible last year but
higher capital market activity so far this year is encouraging.

Kaspi.kz is at the forefront of the new digital revolution, redefined by Super
Apps. The combination of our scale with consumers and merchants, reinforced by
our Super App strategy, puts us in a completely unique position. With the
multi-year structural growth opportunity offered by digitalisation in
Kazakhstan and the neighbouring region amongst the most attractive of anywhere
globally, we thoroughly intend to capture it.

Finally I would like to thank our team for their incredible execution and
dedication to our customers. To our long-term shareholders, thank you for your
ongoing trust and support.

Mikheil Lomtadze

Kaspi.kz CEO and co-founder

 

 

 

Kaspi.kz 1Q 2023 Engagement Highlights
 
 

RTPV transactions up 56%, Total GMV purchases up 71% YoY & 64 transactions
per consumer/month

Kaspi.kz's Super App is Kazakhstan's most popular Super App and gives our
Payments, Marketplace, Fintech and e-Grocery Platforms unrivalled competitive
advantages. During the first quarter of 2023, Super App transaction levels
once again hit all-time highs.

Increased adoption of our existing products by merchants and consumers, along
with a growing range of new products facilitates higher transactions across
more areas of household's spending and merchant's business activity. Average
monthly transactions per active consumer, increased 20% year-over-year to 64,
during the first quarter of 2023.

To drive transactions higher, over the last three years we prioritised
onboarding as many merchants, as rapidly as possible. In 2023 we still expect
strong growth in new merchants, but our focus now is to grow the number of
transactions between consumers and merchants.

We design high quality digital products to grow and monetize transaction
volumes. During the first quarter of 2023, RTPV transactions increased 56%
year-over-year and Total GMV purchases including e-Grocery increased 71%. Fast
growth in monetized transactions, despite economic volatility, illustrates
just how relevant our products are to our customers.

Kaspi Pay and m-Commerce are the basis of our day-to-day relationship with
merchants. Going forward, we will grow earlier stage merchant services
including e-Commerce, B2B Payments, Kaspi Marketing, Kaspi Delivery and
financing for merchants and SMEs. These products all help our merchants invest
in their business, reach new customers, increase their sales and ensure we
remain their digital partner of choice. The growth opportunity ahead is
substantial and as initiatives gradually scale, we will of course provide more
detail.

P2P, Bill Payments, BNPL, Kaspi QR and GovTech are fundamental to high
day-to-day consumer engagement. Going forward, we will grow less mature
services including e-Commerce & Kaspi Postomats, Kaspi Travel's full range
of products, e-Grocery and Kaspi Classifieds. These services help our
consumers discover the products they need, at the best possible prices, from
local merchants, with free delivery, saving time and money. With consumer
penetration across our full range of Super App services still low, here too
the opportunity ahead remains significant.

From start-up in Almaty less than two year ago, we now plan to roll out Kaspi
e-Grocery nationwide. With an innovative, high-quality digital offering, we
believe we can transform the food shopping experience in Kazakhstan. This is a
sizeable opportunity and exciting joint project with Magnum, Kazakhstan's
leading food retailer. As e-Grocery scales, it will mean higher Super App
engagement, faster financial growth and further value creation for our
shareholders.

During the first quarter of 2023, e-Grocery purchases increased 4.3x
year-over-year, with the number of consumers up 5.5x. We now account for
e-Grocery as a stand-alone business segment, no longer part of Marketplace and
for the first time have disclosed e-Grocery's income statement.

Our previously announced plan to invest around KZT20-25 billion per annum over
the next 3 years, on track and unchanged.

Kaspi B2B Payments, which was born out of Bill Payments and P2P, is an example
of how we can grow transactions by targeting completely new types of
customers, in this case wholesalers, distributors and manufacturers.

Number of B2B Payments transactions increased 2.5x year-over-year, during the
first quarter of 2023 and with this product still in its early days, we expect
B2B Payments to keep growing fast. In the medium- term, B2B Payments can be
the start of a long list of innovative B2B services.

We started to roll out Kaspi Postomats in late-2021 and had 3,980 lockers by
the end of March 2023. These lockers are installed in 102 towns and cities and
accounted for 37% of e-Commerce deliveries. Postomats increase the share of
successful 1(st) time deliveries, lower the cost of last-mile-delivery and
will help us protect Marketplace's long-term profitability.

Postomats are also a key part of our plan to make commerce in Kazakhstan more
environmentally sustainable, by dramatically reducing distance driven by
couriers. With consumer feedback extremely positive, we're now planning for
around 6,000 Postomats by the end of this year.

As always, we will continue to launch new services and our product pipeline in
2023 and beyond is as exciting as ever.

Kaspi.kz 1Q 2023 Financial Highlights
 
 

Strong top & equally strong bottom-line

Revenue up 53% and adj. net income up 52% YoY

During the first quarter of 2023, total revenue increased 53% year-over-year
to KZT404 billion.

Our Payments Platform delivered fast and consistent top-line growth, due to
the ongoing success of Kaspi Pay and Kaspi B2B Payments. In Marketplace, we
prioritised expanding SKUs, free consumer delivery and the rollout of Kaspi
Postomats. Kaspi Travel's GMV growth remained additive to Marketplace growth.
Faster TFV origination in the second half of 2022, translated into robust
Fintech revenue growth in the first quarter of 2023, even with lower yield
year-over-year.

During the first quarter of 2023, adj. net income increased 52% year-over-year
to KZT178 billion. Adj. net income profitability of 44% was broadly stable
year-over-year.

We continued to benefit from Payments Platform's operational gearing.
Marketplace profitability increased year-over-year, despite ongoing investment
in free consumer delivery. In Fintech, the combination of yield reduction and
significantly higher funding costs lowered profitability, partially mitigated
by lower provisioning and tight control of operating costs. Higher funding
costs did however help us attract substantial deposit inflows, with average
Kaspi Deposit balances up 45% year-over-year. An enlarged deposit base will
allow us to fund higher TFV over the medium-term and with the decline in
Fintech profitability cyclical, not structural, as interest rates normalise
Fintech profitability will recover.

Our faster growing and higher margin Payments and Marketplace Platforms
continued to deliver strong bottom-line growth, accounting for 60% of adj. net
income, up from 51% in the same period in 2022. In 2023, we expect the
contribution to net income from our Payments and Marketplace Platforms to
increase again year-over-year.

Our cash generation capacity remains as strong as ever. As a result, our Board
of Directors has proposed, subject to shareholder approval, a first quarter
2023 dividend of KZT750/GDR. In addition, in March we commenced a new GDR
buyback program of up to $100mn.

Payments Platform

Strong top-line & even faster bottom-line growth

RTPV up 62%, revenue up 59% and adj. net income up 67% YoY

Our Payments Platform offers a highly convenient way to shop, pay bills and
make peer-to-peer payments using the Kaspi.kz Super App. As has been the case
globally, in Kazakhstan there has been a huge shift to mobile payments, with
consumers demanding a seamless digital experience, no matter where they shop.
Kaspi Pay is our response to help merchants exceed their customers'
expectations and with Kaspi B2B Payments we are now digitalising supplier
payments.

Payments Platform products are also amongst our most important tools to
increase engagement. We continue adding new opportunities to spend and pay,
which is a function of new merchants and product development.

We have prioritised growth in Payments Platform merchants over the last three
years. Merchant growth was up 75% year-over-year in the first quarter of 2023
and is expected to remain strong for the remainder of this year. However, our
focus now is transaction intensity and during the period, number of Payments
Platform revenue generating transactions increased 56% year-over-year. As
merchants shift more of their volumes to us, Revenue Generating TPV (RTPV)
will keep growing at a fast rate.

With a large and diverse merchant base, consumer growth remained robust.
Payments Platform active consumers increased 16% year-over-year, reaching 11.7
million, in the first quarter of 2023.

During the first quarter of 2023, RTPV increased 62% year-over-year to KZT5.8
trillion. Over the same period, Total Payment Value (TPV) increased 50%. RTPV
continues to grow significantly faster than TPV due to our success rolling out
Kaspi Pay, B2B Payments and the ongoing popularity of Bill Payments.

Over the last year, Kaspi B2B Payments has emerged as a fast-growing component
of our RTPV. Our B2B Payments proposition connects small merchants with
wholesalers, distributors and manufacturers, allowing invoices to be settled
instantly and conveniently. During the first quarter of 2023, B2B Payments
RTPV increased 3.1x year-over-year to KZT196 billion and accounts now for 3%
of RTPV. We expect B2B Payments to continue growing significantly faster than
Payments RTPV in 2023.

Average interest free balances increased 6% year-over-year in the first
quarter of 2023 to KZT678 billion. More modest growth in balances, in part is
due to retail disruption and temporarily high balances in the first quarter
last year, along with the increased attractiveness of interest bearing Kaspi
Deposit accounts. In the second quarter of 2023, we expect higher
year-over-year growth in average interest free balances.

During the first quarter of 2023, Payments Platform revenue increased 59%
year-over-year to reach KZT101 billion. Take-rate during the same period was
stable at 1.2%. Take-rate slightly above our full-year 2023 guidance of around
1.1% guidance, is a function of timing and as Kaspi Pay and B2B Payments
keeping growing their share of RTPV, take-rate should gradually move down to
around 1.1%.

Payments Platform adj. net income increased 67% year-over-year to KZT66
billion, with net income profitability of 65.1% compared to 62.0% in the first
quarter of 2022. Payments Platform profitability continues to benefit from the
elimination of third-party costs, our proprietary payments network's
operational gearing and tight cost control.

In 2023 we continue to expect Payments Platform to deliver RTPV growth of
around 35% year-over-year, with growth weighted towards the first half of the
year. Average current account balances are expected to increase 15%. Take rate
will be around 1.1%. With Payment Platform's inherent operational gearing
unchanged, adj. net income profitability is expected to be in the mid-60%
range.

Looking into the medium-term, Payments Platform cohort analysis continues to
show strong growth across every consumer cohort. Existing consumers keep
spending more with us and as we add more opportunities to transact, fast
growth can be sustained. Kaspi B2B Payments increases our addressable market
further. We will stay disciplined on costs, ensuring strong top-line trends,
drop through to the bottom-line. As a result, we remain extremely positive
about the growth outlook for Payments Platform in 2023 and beyond.

Marketplace Platform
 
 
                                Strong and accelerating GMV
& revenue growth. Faster bottom-line growth
 
  GMV up 77%, revenue up 97% and adj. net income up 104% YoY

Our Marketplace Platform connects merchants with consumers and puts us front
and centre of their purchasing decisions. Merchants can reach around 12.8
million consumers and consumers can find a wide selection of products and
services, at the best possible prices. Kaspi Marketplace champions domestic
Kazakh brands and merchants.

m-Commerce is our mobile solution for shopping in person, while consumers can
use e-Commerce to shop anywhere, any time with free delivery. Kaspi Travel
allows consumers to book domestic and international flights, rail tickets and
overseas package holidays. Marketplace and e-Grocery offer a unified digital
experience, irrespective of online or offline and are relevant across
practically all areas of consumer spending.

Just as with our Payments Platform, the expansion of our Marketplace merchant
base has been an important focus. Now we're prioritising growth in
transactions and during the first quarter of 2023, Marketplace purchases
increased 67% year-over-year. When combined with e-Grocery, purchases
increased 71% year-over-year.

With the attractiveness of Marketplace's consumer proposition continuing to
increase, growth in consumers was strong, up 27% year-over-year to 6.4
million.

Marketplace GMV momentum accelerated again, up 77% year-over-year with GMV
reaching KZT756 billion in the first quarter of 2023.

m-Commerce continues to deliver excellent results. During the first quarter of
2023 purchases increased 46% year-over-year. In early 2022 we scaled back
promotional activity, but the combination of normal levels of promo and growth
in retail trade led to a substantial increase in average ticket-size
year-over-year. As a result, GMV increased 75%, a considerably faster rate
than purchases and reached KZT435 billion. Normalised promotional activity
resulted in m-Commerce's take-rate increasing to 8.0% from 7.4% over the same
period.

In the first quarter of 2023, e-Commerce demand was extremely strong with
orders up 216% year-over-year. GMV increased 79% year-over-year to KZT254
billion, marking the fourth consecutive quarter of accelerating GMV growth
momentum. GMV growth below order growth, reflects our ongoing efforts to
expand the breadth and depth of everyday items at lower price points, in order
to enhance Marketplace's long-term competitive position. E-commerce SKUs
increased 2.0x year-over-year to 3.1 million. As with m-Commerce, normalised
promo, combined with ongoing initial monetization of Kaspi Delivery and Kaspi
Advertising resulted in e-Commerce's take-rate increasing to 10.2% from 8.7%
over the same period.

Our investment in free nationwide delivery for consumers is helping us attract
new e-commerce consumers and merchants and gives Marketplace another long-term
competitive advantage. In the first quarter of 2023, orders delivered
increased 232% year-over-year. Higher delivery volumes enable us to reduce the
unit cost of delivery, making it easier and more profitable for our merchants
to sell throughout Kazakhstan. Delivery now accounts for 96% of orders, was
free for the consumer on 92% of orders, with 49% of orders delivered within 48
hours.

We started to roll out Kaspi Postomat in late-2021 and had 3,980 lockers by
the end of March 2023. These lockers are installed in 102 towns and cities and
accounted for 37% of e-Commerce deliveries, during the first quarter of 2023.
Postomats increase the share of successful 1st time deliveries, lower the cost
of last-mile-delivery and will help us protect Marketplace's long-term
profitability. Given positive customer feedback we're now planning for around
6,000 Postomats by the end of this year.

Kaspi Travel's GMV increased 84% year-over-year to KZT68 billion during the
first quarter of 2023, with ticket sales up 54% to 3.2 million. Over the same
period, take-rate increased by 60bps year-over-year to 4.1%, due to the
growing share of higher take-rate rail bookings. Travel's GMV now accounts for
9% of Marketplace GMV, which is impressive scale in just over two years and we
have just added international package holidays. For the remainder of this year
Travel's fast growth should be additive to Marketplace GMV growth. The
addition of package holidays is expected to be take-rate enhancing over the
medium-term.

Marketplace take-rate increased to 8.4% from 7.5% in the first quarter of
2022. As a result, Marketplace revenue grew faster than GMV and was up 97%
year-over-year to KZT64 billion. Take-rate will vary from quarter-to-quarter
due to the timing of promotional events and higher take-rate year-over-year in
the first quarter of 2023, should not be extrapolated given very low levels of
promotional activity in the first quarter last year. For the remainder of the
year increased monetization of Kaspi Delivery and Kaspi Advertising will
contribute positively but take-rate dilution from Kaspi Travel will partially
offset this and for full-year 2023 we continue to expect a Marketplace
take-rate of around 8.5%.

During the first quarter of 2023, Marketplace Platform adj. net income reached
KZT41 billion, representing a 104% increase year-over-year. Net income
profitability was 63.8% up from 61.5% in the same period in 2022, with
increased investment in free consumer delivery fully offset by tight control
of sales and marketing costs, as well as technology and product development
costs.

In 2023 we continue to expect Marketplace Platform to deliver GMV growth of
around 35% year-over-year. As with our Payments Platform, growth will be
weighted to the first half of the year and in the case of Marketplace this is
especially true of the first quarter. Items sold will continue growing faster
than GMV. However, as new lower ticket categories grow in share, faster GMV
growth is coming through and we expect e-Commerce GMV growth to be faster this
year than in 2022. Take-rate is expected to increase year-over-year to around
8.5%, which reflects faster growth from high take-rate e-Commerce, which in
part is due to higher monetisation of Kaspi Marketing and Kaspi Delivery,
partially offset by Kaspi Travel's higher share of GMV. Adj. net income
profitability is expected to be around 60%, despite ongoing investments in
free consumer delivery.

Looking into the medium-term, as with our Payments Platform, Marketplace
Platform cohort analysis continues to show strong growth across every consumer
cohort. Enhanced shopping categories lead to more transactions per consumer
and help us attract new consumers. Having substantially grown our Marketplace
merchant base over the last two years, our focus will pivot to helping
existing merchants sell more. Earlier-stage initiatives like Kaspi Marketing,
Kaspi Delivery and SME financing are a big part of this and should ensure
strong growth from Marketplace Platform in 2023 and beyond.

Fintech Platform
 
 
                               TFV origination growing fast
YoY, healthy CoR trends & strong deposit base growth
                                         TFV up 76% &
deposits up 45% YoY and 1.7% credit CoR in 1Q23

Our Fintech Platform is fundamentally integrated into our Payments and
Marketplace Platforms. The short-term nature of all our financing and more
specifically Buy-Now-Pay-Later (BNPL) products, allow us to quickly ramp-up or
scale back origination as we observe changes in transaction activity. Kaspi
Deposit accounts fund our origination and the attractiveness of our full range
of Super App services, allows us to ensure our funding is sufficient to meet
origination and transaction demand.

In the first half of last year and especially the first quarter, we took a
cautious approach to Total Finance Value (TFV) origination. In 2023
year-over-year growth is therefore expected to be first half weighted. During
the first quarter of 2023, TFV increased 76% year-over-year, to reach KZT1.5
trillion. We finished the quarter with 5.7 million loan consumers, up 15%
year-over-year.

Low risk, small ticket, short duration Buy-Now-Pay-Later (BNPL) loans
accounted for 43% of TFV in the first quarter of 2023, making them our most
important Fintech Platform product. With Kaspi Juma scheduled to take place in
both the third and fourth quarters, we expect the share of BNPL to step up
again in the second half of the year. Our Merchant Finance products are our
fastest growing lending product and accounted for 14% of TFV in the first
quarter of 2023, up from 10% in the same period last year. We expect lending
to merchants to continue growing at a faster rate than TFV in 2023.

Our average net loan portfolio increased by 32% year-over-year, to KZT3.2
trillion during the first quarter of 2023. Our deposit base has seen
substantial growth since the second half of last year and in the first quarter
of 2023, average savings increased by 45% year-over-year to KZT4.0 trillion.
Deposit consumers increased 35% to 4.0 million. Following strong growth in
deposit consumers and deposit inflows, our loan to deposit ratio fell to 79%
in the first quarter of 2023, from 88% in same period in 2022 and was stable
compared with the fourth quarter of 2022.

During 2022 we raised Kaspi Deposit rates and higher funding costs are
resulting in lower near-term Fintech profitability. However, more deposit
consumers and an enlarged funding base, will enable us to drive faster
origination and more transactions over the medium-term. Hence, we expect our
loan to deposit ratio to gradually move up again over the medium-term.

Portfolio conversion of 2.1x in the first quarter of 2023, is in line with
trends over the last year, reflecting ongoing high early repayments levels and
is indicative of financially healthy consumers borrowing, transacting and
repaying quickly. With no deterioration in consumer credit quality, we expect
to continue benefiting from rapid portfolio conversion in 2023.

Fintech yield was 25.3% during the first quarter of 2023, reflecting the
growing share of lower yielding BNPL and Merchant Finance loans and consistent
with our full-year 2023 guidance of around 25%.

During the first quarter of 2023, our underlying credit cost of risk was 1.7%,
with credit quality strong and consistent with trends seen over the last year.
Low credit cost of risk in part reflects the low-risk nature of our products,
especially BNPL. Our NPL ratio of 6.5%, up from 6.3% at the end of 2022
reflects normal seasonality and is expected to moderate in the second half of
the year.

Fintech Platform revenue increased by 35% year-over-year to reach KZT231
billion, during the first quarter of 2023. Fintech revenue growth is
benefitting from higher origination in the second half of 2022, partially
offset by lower yielding BNPL but remains generally robust.

In the first quarter of 2023, Fintech Platform's adj. net income increased by
24% year- over- year to reach net income of KZT71 billion. Adj. net income
margin of 30.9% compares with 33.8% in the first quarter of 2022. Declining
profitability mainly resulted from higher year- over-year funding costs, with
interest expense up 103% year-over-year. However, higher funding costs were
partially offset by lower provisioning and lower sales and marketing, which
declined by 37% and 18% year-over-year respectively. When interest rates
normalise, we'd expect newly acquired customers to stay with us, resulting in
Fintech margins recovering.

We expect TFV year-over-year growth to remain elevated during the first half
of 2023 and for the full-year to increase around 35% year-over-year. Although
we will continue to prioritise our BNPL product, we also expect Kaspi Business
merchant and SME financing products to keep scaling rapidly. BNPL integrated
with Kaspi Travel is also expected to see strong growth, especially as package
holidays gather momentum. Changing product mix is reflected in our yield
guidance of around 25%. With consumer credit quality high, portfolio
conversion and cost of risk trends are expected to be broadly similar to 2022.
Fintech adj.net income profitability of around 30%, primarily reflects the
near-term impact of higher funding costs.

Looking beyond 2023, our Fintech Platform remains extremely well positioned,
as evidenced by ongoing growth in loan and deposit customers, as well as
deposit inflows. Structural top-line growth will be driven by BNPL as well as
merchant and SME financing, which is underpenetrated in Kazakhstan.
Bottom-line growth will benefit through-the-cycle, from normalising funding
costs and we see further potential to improve our risk management
capabilities, which all combined points to a robust top and bottom-line
mid-term outlook for Fintech.

Guidance for full-year 2023

At our full-year 2022 financial results in February, we provided detailed 2023
KPIs and financial guidance. Since then, trading has remained strong. As
previously flagged, we continue to expect year-over-year growth to be 1H and
especially 1Q weighted for Marketplace GMV and Fintech TFV, with significantly
higher funding costs and ongoing macro volatility likely to remain themes.
Notwithstanding, we expect Kaspi.kz to once again deliver good operating and
financial results in 2023.

GDR buyback program

On the 22 March 2023 we announced the commencement of a new 4-month GDR
repurchase program. The programs aggregate purchase amount is for up to USD
100 million.

Total GDR's outstanding as at 31 March 2023 were 190,353,730.

Potential listing in the United States

We have previously commented that we are considering the possibility of
listing Kaspi.kz in the United States. We see multiple potential benefits from
a US listing, including an enlarged, more diverse shareholder base and
increased trading liquidity. We have now started to prepare for such an event,
albeit remain in the early stages, with any transaction naturally contingent
upon market conditions.

Conference Call Information

On Monday, 24 April 2023 the management will hold a conference call and
webcast at 1.00pm (London) (8.00am U.S. Eastern Time, 6.00pm Astana time) to
review and discuss the company's results for the quarter ending March 31 2023.

To pre-register for this call, please go to the following link:

https://www.netroadshow.com/events/login?show=d4713773&confId=49188

You will receive your access details via email.

Kaspi.kz Platform Income Statements

Kaspi.kz Consolidated Financial Statements

About Kaspi.kz

Kaspi.kz's mission is to improve people's lives by developing innovative
mobile products and services. To deliver upon this we operate a unique
two-sided Super App model - Kaspi.kz Super App for consumers and Kaspi Pay
Super App for merchants.

The Kaspi.kz Super App is Kazakhstan's most popular mobile app, with 12.8
million MAU in 1Q 2023, 8.3 million of whom access our services daily. The
Kaspi Pay Super App is the digital partner of choice for businesses and
entrepreneurs in Kazakhstan, with 512K merchant partners in 1Q 2023.

Through these Super Apps consumers and merchants can access our leading
Payments, Marketplace, Fintech and e-Grocery Platforms. All our services are
designed to be highly relevant to users' everyday needs and enable consumers
and merchants to connect and transact, using our proprietary payments network.

In partnership with Magnum, Kazakhstan's largest food retailer, we have
launched e-Grocery. Together we are digitalising food retail, with the aim of
creating a dramatically better shopping experience. Consumers access e-Grocery
using the Kaspi.kz Super App, can choose from around 12k SKUs, at competitive
prices, with free same-day delivery.

The combination of a large, highly engaged consumer and merchant base,
best-in-class, highly relevant digital products and a capex lite approach,
results in strong top-line growth, a profitable business model and enables us
to continue innovating, delighting our users and fulfilling our mission.

Kaspi.kz has been listed on the London Stock Exchange since 2020.

For further information david.ferguson@kaspi.kz +44 7427 751 275

Forward-looking statements

Some of the information in this announcement may contain projections or other
forward- looking statements regarding future events or the future financial
performance of Kaspi.kz. You can identify forward looking statements by terms
such as "expect", "believe", "anticipate", "estimate", "intend", "will",
"could," "may" or "might", the negative of such terms or other similar
expressions. Kaspi.kz wish to caution you that these statements are only
predictions and that actual events or results may differ materially. Kaspi.kz
does not intend to update these statements to reflect events and circumstances
occurring after the date hereof or to reflect the occurrence of unanticipated
events. Many factors could cause the actual results to differ materially from
those contained in projections or forward-looking statements of Kaspi.kz,
including, among others, general economic conditions, the competitive
environment, risks associated with operating in Kazakhstan, rapid
technological and market change in the industries the Company operates in, as
well as many other risks specifically related to Kaspi.kz and its respective
operations.

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