4finance reports results for the twelve months ending 31 December 2016

28 February 2017. 4finance Holding S.A. (the ‘Group’), Europe’s largest online and mobile consumer lending group, today announces unaudited consolidated results for the twelve months ending 31 December 2016 (the ‘Period’).

Revenue up 24%, net profit eur 63.2 million, showing continued profitable growth

Financial Highlights

  • Revenue up 24% to EUR 393.2 million in the Period compared with EUR 318.3 million in the prior year period.
  • Adjusted EBITDA was EUR 137.4 million for the Period, up 15%, leading to an adjusted interest coverage ratio of 3.6x.
  • The Group’s profit from continuing operations for the twelve months to 31 December 2016 was EUR 63.2 million, an increase of 9% from EUR 58.2 million in 2015.
  • Net loan portfolio reached EUR 493.9 million as of 31 December 2016, up 60% during the year.
  • Cost to revenue ratio for the Period was 48%, vs. 42% for the twelve months to 31 December 2015, reflecting a significant increase in staff numbers during the year, acquisitions and investment for future growth.
  • Financial strength remains solid with a capital to assets ratio of 25% as of 31 December 2016 and a capital to net loans ratio of 47%.
  • Credit discipline maintained, with a non-performing loans to online loan issuance ratio of 9.3% as of 31 December 2016, within the expected range, and stable asset quality within banking portfolios.

Operational Highlights

  • The number of registered online lending customers reached 6.3 million as of 31 December 2016, up 36% from a year ago, with a further 1.4 million registered banking customers added through TBI Bank.
  • Record online loan issuance in fourth quarter, exceeding EUR 100 million each month, with a growing contribution from Argentina and Mexico.
  • Continued product diversification in existing European markets: launch of instalment loans in Czech Republic in December 2016 (kimbi.cz) following launches in Spain and Romania earlier in the year.
  • TBI Bank delivered a strong financial performance in Q4, and regulatory applications are in process for passporting of credit card licenses and portfolio transfers.
  • Completed transition to two-tier board structure: Mark Ruddock joins Supervisory Board and Kieran Donnelly steps down from management boards.

George Georgakopoulos, CEO of 4finance, commented:

“With revenue growth of 24% and net profit of EUR 63.2 million, our full year results continue a strong track record of delivering solid profits and growing the business. In a year of market changes, we have strengthened our competitive position in Europe and established the foundations for future growth, particularly in Latin America.

“TBI Bank continues to see growth in both consumer lending and deposits in a liquid local market. We are working closely with European regulators on a number of initiatives to use the bank’s capabilities to introduce new products such as credit cards in select markets and to lower our effective overall funding cost for online loans.

“As a responsible lender, we welcome the introduction of new regulation due in a number of markets in 2017/18. We continue to make the positive case for access to online credit for consumers and the value of our products. Regulators increasingly recognise the value of meeting the demand of under-served borrowers within a regulated sector and we believe we are well positioned to meet this need.

“Our confidence in future growth builds on the significant scale, diversification, brand positioning and capabilities of the Group. As Kieran Donnelly leaves us after three years as CEO and then Chairman, we thank him for his significant contribution in establishing
that platform.”

Key Financial Ratios

Year Ended 31 December, 2016 unaudited Year Ended 31 December 2015 unaudited Year Ended 31 December, 2014 audited
2016 2015 2014
Net loan portfolio (in millions of EUR) (1) 493.9 308.3 241.4
Capital/assets ratio (2) 25% 40% 35%
Capital/net loan portfolio (3) 47% 56% 47%
Adjusted interest coverage (4) 3.6x 4.2x 3.7x
Profit before tax margin (5) 21% 23% 27%
Return on average equity (6) 31% 41% 54%
Cost/revenue ratio (7) 48% 42% 37%
Net impairment to revenue ratio (8) 23% 24% 25%
Non-performing loans to loan issuance ratio(9) 9.3% 9.0% 8.8%


  1. Gross loan portfolio less provisions for bad debts.
  2. Total equity/total assets (2014 assets adjusted for effect of bond defeasance).
  3. Total equity/net customer loan portfolio.
  4. Adjusted EBITDA/interest expense.
  5. Profit before tax/interest income.
  6. Profit from continuing operations/average equity (total equity as of the start and end of each period divided by two).
  7. General administrative expenses/interest income.
  8. Net impairment losses on loans and receivables/interest income.
  9. Non-performing online loans with a delay of over 90 days/value of online loans issued. The value of loans issued represents online loans issued
    for the two-year period before commencement of the 90 day past-due period, eg for 31 December 2016: 1 October 2014 to 30 September 2016.


Email:               investorrelations@4finance.com
HQ Address:       Lielirbes iela 17a-8, Riga, LV-1046, Latvia
Website:            www.4finance.com

Conference call

A conference call with management to discuss these results is scheduled for Thursday, March 2 at 15:00 UK time. To register, please visit www.4finance.com/investors

About 4finance
Established in 2008, 4finance is the largest and fastest growing online and mobile consumer lending group in Europe with operations in 16 countries. Putting innovative data-driven analysis into all aspects of the business, 4finance has grown rapidly, issuing over EUR 4 billion to date in single payment loans, instalment loans and lines of credit.

4finance operates through a portfolio of market leading brands with strong regional presence including Vivus, SMSCredit and Zaplo. A responsible lender, offering simple, convenient and transparent products and service, 4finance is meeting growing customer demand from those under-served by conventional lending.

4finance has group offices in Riga (Latvia), London (UK) and Miami (USA), and currently operates in Argentina, Armenia, Bulgaria, the Czech Republic, Denmark, the Dominican Republic, Finland, Georgia, Latvia, Lithuania, Mexico, Poland, Romania, Spain, Slovakia and Sweden. The group also provides consumer and SME lending through TBI Bank, its EU licensed banking operations in Bulgaria and Romania.

Forward looking statements
Certain statements in this document are “forward-looking statements”. These statements are based on management’s current expectations and are subject to uncertainty and changes in circumstances. Actual results may differ materially from those included in these statements.

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