Multitude Group publishes its preliminary unaudited annual results for 2021

DGAP-News: Ferratum Capital Germany GmbH / Key word(s): Preliminary results
15.03.2022 / 07:30
The issuer is solely responsible for the content of this announcement.

Multitude Group publishes its preliminary unaudited annual results for 2021

Helsinki, March 15, 2022 – Multitude SE (ISIN: FI4000106299, WKN: A1W9NS) (“Multitude” or the “Group”) announces preliminary unaudited results for the year ended December 31, 2021.

Multitude introduced a new strategy and new brands in 2021

During the second quarter of 2021, the Group renamed the previous segments Microloan, PlusLoan, CreditLimit, CapitalBox and Mobile Wallet, including Primeloan. The newly introduced segments and brands within the group are called Ferratum, CapitalBox and SweepBank. According to the new strategy, the Group’s business units now have a more independent role to be even closer to their customers and their specific needs. The Group focuses on critical operations, with cost advantages derived from achieving greater economies of scale.

Financial Highlights

– Selective increase in risk appetite and increased market activity led to significant decrease in impairments and increase in overall portfolio

– Stable cost base and positive profit from continuing operations

– Improvement of current assets, liquidity and net debt to equity ratios

Key figures, in millions of euros

2021

2020*

Income

213.7

230.4

Impairment of customer loans

(71.9)

(91.0)

Earnings before interest and taxes (“EBIT”)

23.9

28.5

pre-tax profit

3.6

6.2

Profit from continuing operations

1.2

5.0

Loss of discontinued operations

(3.8)

(4.5)

Profit (loss) for the year

(2.6)

0.5

Earnings per share, continuing operations (in EUR)

0.06

0.23

Earnings per share, discontinued operations (in EUR)

(0.18)

(0.21)

Earnings per share for the year (in EUR)

(0.12)

0.02

* Restated from discontinued operations

Selective increase in risk appetite and increase in market activity
Group revenues amounted to €213.7 million in 2021, a decrease of €16.8 million (-7.3%), compared to €230.5 million in 2020, mainly due to the group’s decision to stop lending activities in certain markets.

The Group has chosen to apply a more strategic approach by selectively increasing its risk appetite, strengthening its marketing and credit activities, and investing in the development of products and infrastructures, in markets and more stable clientele. These resulted in a regular increase of 82.9 million euros (+23.0%) in the Group’s collective loan portfolio, which amounted to 443.9 million euros at the end of 2021 compared to 361 .0 million euros at the end of 2020. As a result, the above activities resulted in an increase in the Group’s credit, sales and marketing expenses and depreciation.

On the other hand, Multitude’s cautious business approach and enhanced scoring algorithms have proven beneficial in improving the Group’s overall underwriting quality despite high economic volatility, as evidenced by the significant decrease in impairment losses of 91 .0 million euros (39.5% of revenue) in 2020 to 71.9 million euros (33.7% of revenue) in 2021.

Staff costs and general and administrative costs stable year-on-year
In 2020, the Group introduced measures to streamline its operations and reduce its overall expenditure in activities other than lending, marketing and product and infrastructure development in order to counter the impacts of the COVID-19 pandemic and to improve overall operational efficiency and profitability, which resulted in a sharp reduction in the Group’s personnel costs and general and administrative expenses.

During the year 2021, personnel expenses remained stable with a slight decrease from €33.1 million in 2020 to €33.0 million in 2021 (a decrease of €0.1 million or -0.3%), with a slight decrease in the Group’s average headcount from 695 HC in 2020 to 674 HC in 2021. The same applies to the Group’s general and administrative expenses, which amounted to 28, 9 million euros in both 2021 and 2020.

Positive EBIT from continuing operations
EBIT from continuing operations of the Group amounted to €23.9 million and €28.5 million in 2021 and 2020, respectively, which includes other net income of €0.3 million and €0.5 million in 2021 and 2020, respectively.

Reduction in net financial charges
Net finance costs decreased by €2.0 million (-8.9%), amounting to €20.3 million in 2021, compared to €22.3 million in 2020, due to the decline in foreign exchange losses and interest expense during the year – the latter resulting from the conversion of a portion of the outstanding 2018 and 2019 bonds into 2021 perpetual bonds, the interest of which is charged directly to earnings retained earnings instead of net income, slightly offset by the premiums paid by the Group on the redemption of converted 2018 and 2019 debt instruments.

Streamlined operations resulting in ongoing overall profitable results
In line with its measures to streamline its operations and its reporting structure, the Group has disposed of all its interests in Ferratum UK Ltd., which requires presenting the results of these discontinued operations separately from those of continuing operations in the consolidated statements of Group. earnings and cash flow.

Accordingly, the Group has allocated post-tax losses from discontinued operations amounting to €3.8 million and €4.5 million in 2021 and 2020, respectively for the comparative years presented. The 2021 loss from discontinued operations includes a loss of €2.0 million on the disposal relating to Ferratum UK Ltd.

Profit after tax from continuing operations amounted to €1.2 million and €5.0 million in 2021 and 2020, respectively.

Solid asset position
Total assets at the end of 2021 amounted to €819.0 million, an increase of €143.9 million (+21.3%), compared to €675.1 million at the end 2020. This is mainly due to the increase in loans and advances to customers and cash and cash equivalents.

Cash and cash equivalents increased by €65.0 million (+27.5%), amounting to €301.6 million at the end of 2021 (2020 – €236.6 million) , while customer loans increased by €82.9 million (+23.0%), amounting to €443.9 million at the end of 2021 (2021 – €361.0 million ), resulting from the Group’s successful “increasing loan disbursements” strategy for its Primeloan product under SweepBank, but also loan portfolio growth in Ferratum and CapitalBox

Current assets amounted to €765.0 million, or 93.4% of the Group’s total assets at the end of 2021 (2020 – €615.1 million, 91.1%), while non-current amounted to EUR 54.1 million, or 6.6% of total assets at the end of 2021. end of 2021 (2020 – EUR 59.9 million, 8.9%).

Increase in customer deposits contributing to the Group’s liquidity
Equity increased from €125.6 million at the end of 2020 to €169.5 million at the end of 2021, resulting in a healthy equity ratio of 20.7% (2020 – 18.6%) . This was accompanied by a corresponding decrease in the net debt to equity ratio from 2.49 at the end of 2020 to 2.05 at the end of 2021. These changes were mainly due to the replacement of parts of the 2018 bonds and 2019 by hybrid capital. bond, accounted for as an equity instrument.

Current liabilities amounted to €508.6 million, or 78.3% of the Group’s total liabilities at the end of 2021, an increase of €202.1 million (+65.9%), compared to to €306.6 million at the end of 2020, i.e. 55.8% of total liabilities at the end of 2020. The increase in current liabilities is mainly due to the increase in outstanding customer deposits, which amounted to €402.0 million at the end of 2021 compared to €275.8 million at the end of 2020 due to – an increase of €126.1 million (+45.7%) and the reclassification of the Ferratum Capital Germany GmbH bonds issued in 2018 and maturing in May 2022.

Total current and non-current customer deposits amounted to €484.8 million at the end of 2021 (2020 – €339.5 million), which contributed positively to the Group’s liquidity, allowing the continuation of strategic growth initiatives in the three tribes.

About Multitude SE:

Multitude is a fully regulated fintech growth platform. Its ambition is to become the most valued financial ecosystem. This vision is backed by over 15 years of solid experience building and scaling fintech. With its full European banking license, deep technology, regulatory, cross-selling and financing know-how, Multitude enables a range of sustainable banking and financial services to grow and grow. Currently, it has three independent business units on this growth platform: Ferratum as a consumer lender, CapitalBox as a business lender, and SweepBank as a shopping and funding app. Multitude and its independent units employ more than 700 people in 19 countries and together generated sales of €213 million in 2021. Multitude was founded in 2005 in Finland and is listed on the Prime Standard segment of the Stock Exchange of Frankfurt under the symbol “FRU”. ‘www.multitude.com

15.03.2022 Broadcast of a Corporate News, transmitted by the DGAP – a service of EQS Group AG.
The issuer is solely responsible for the content of this announcement.

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