TCS Group Holding PLC
TCS Group Holding PLC
- ISIN: US87238U2033
- Land: Zypern
Nachricht vom 20.11.2019 | 08:00
TCS Group Holding PLC reports another quarter of record profit in 3Q 2019
TCS Group Holding PLC (TCS)
TCS Group Holding PLC reports another quarter of record profit in 3Q 2019
LIMASSOL, CYPRUS - 20 November 2019. TCS Group Holding PLC (LI: TCS, MOEX: TCSG) ("Tinkoff", "We", the "Group", the "Company"), Russia's leading provider of online financial and lifestyle services via its Tinkoff ecosystem, today announces its interim condensed consolidated IFRS results for the third quarter and nine months ended 30 September 2019.
Oliver Hughes, CEO, commented:
"I am happy to report substantial growth in our customer base and net loan portfolio, as we continued to deliver record-high quarterly profit and achieve important technological milestones.
Tinkoff continues to deliver strong results amid the evolving regulatory environment and ongoing changes in Russia's consumer banking market. Our net loan portfolio grew by 61% in 9M'19, underpinned by strong customer base expansion. Meanwhile our net profit in the first nine months of the year rose by over 32% compared to the same period last year to reach RUB 25.1 bn.
A key focus of 2019 has been on further building the ecosystem and expanding our non-credit business lines, which accounted for 32% of our total revenue in the first nine months. The number of current account customers increased by 39%, while the number of customers in Tinkoff Investments increased 2.4x. These figures demonstrate that customers are increasingly turning to Tinkoff for a greater share of their lifestyle needs. We do far more than finance!
In the first days of the third quarter we completed a successful SPO on the London Stock Exchange, raising $300 million in gross proceeds to further reinforce our capital position and support Tinkoff's continued growth. On 28 October, Tinkoff GDRs began trading on the Moscow Exchange, giving more Russian investors the opportunity to invest in a company they trust for all their financial and lifestyle needs. We are confident that this move will support the liquidity and market capitalisation growth of Tinkoff going forward.
Tinkoff has delivered an excellent quarter, and this is a result of our dedication to product, interface and customer service. Customers respond eagerly to our initiatives to improve our app and services by engaging more actively with the app and the broader Tinkoff ecosystem. We will continue this impressive growth on all fronts in 2020."
FINANCIAL AND OPERATING REVIEW
In 3Q'19, the Group's total revenue grew by 50% y-o-y to RUB 43.6 bn (3Q'18: RUB 29.0 bn). Gross interest income increased by 51% y-o-y to RUB 28.8 bn (3Q'18: RUB 19.0 bn), thanks to the continued growth of our customer base and the expansion of our product range.
Gross interest yield declined to 32.3% in 9M'19 due to the increase of the non-credit card share of our portfolio. The interest yield on the Group's securities portfolio decreased to 6.8% (3Q'18: 6.9%).
In 3Q'19, interest expense grew by 39% y-o-y to RUB 5.5 bn (3Q'18: RUB 3.9 bn), driven by both significant growth of customer base and new bond issues. At the same time, our cost of borrowing decreased to 5.7% in 3Q'19 following gradual decrease in deposit rates.
In 3Q'19, net margin grew by a remarkable 55% y-o-y to RUB 22.9 bn (3Q'18: RUB 14.8 bn), primarily as a result of solid net loan growth.
Cost of risk rose to 9.1% in 3Q'19 (2Q'19: 8.9%), reflecting high loan growth rates, front-loaded provisioning under IFRS9, and continued fine-tuning of our credit risk and approval models. Meanwhile, our risk-adjusted net interest margin decreased to 14.4% in 3Q'19 (3Q'18: 18.1%) due to the continued product diversification of our loan portfolio towards more secured and lower interest rate products.
Our non-credit business lines continue to deliver robust performance thanks to customer base growth, and represent 32% of the Group's total revenue in the first nine months of 2019. Fee and commission income rose by 33% y-o-y to RUB 9.4 bn in 3Q'19 (3Q'18: RUB 7.0 bn), accounting for 21% of total revenue, while Tinkoff Insurance more than doubled its income y-o-y to RUB 4.3 bn (3Q'18: RUB 2.0 bn).
As at the end of 9M'19, the Group had:
Operating expenses decreased q-o-q from RUB 11.8 bn in 2Q'19 to RUB 11.5 bn in 3Q'19 (3Q'18: RUB 8.7 bn) due to lower advertising activity. The cost-to-income ratio decreased to 34.4% in 3Q'19 (3Q'18: 39.6%).
The Group reported record quarterly net income of RUB 9.7 bn in 3Q'19 (3Q'18: RUB 7.3 bn). Net income for 9M'19 amounted to RUB 25.1 bn (9M'18 RUB 19.0 bn). As a result, ROE for 9M'19 stood at 59.0% (9M'18: 72.9%).
In 9M'19, the Group continued to maintain a healthy balance sheet with total assets growing by 35% since the start of 2019 to RUB 507.6 bn (31 Dec'18: RUB 375.5 bn).
The Group's gross loan book grew by 57% YTD to RUB 369.0 bn (31 Dec'18: RUB 234.7 bn), while the net loan book grew by 61% YTD to RUB 319.9 bn (31 Dec'18: RUB 198.5 bn).
The Group's NPL ratio rose to 7.9%, while our loan loss provision coverage remained stable at 1.68 non-performing loans.
The Group's customer accounts increased by 23% YTD to RUB 346.7 bn (31 Dec'18: RUB 280.9 bn).
Tinkoff's total equity increased by 97% YTD to RUB 83.4 bn (31 Dec'18: RUB 42.3 bn). As of 1 October 2019, the Group's statutory N1.0 ratio stood at 11.9%, and its N1.2 ratio was at 10.9%. N1.1 stood at a comfortable 8.4%.
UPDATED GUIDANCE FOR 2019
Following strong underlying growth year to date in 2019, the Group is pleased to update its FY'19 performance guidance:
9M'2019 AND POST-REPORTING PERIOD OPERATING HIGHLIGHTS
Customer base and engagement growth has led to increased market share
Superior and innovative offering combined with targeted marketing activities secure Tinkoff's place as Russia's leading fintech brand
The investment community and industry associations recognize Tinkoff's strong performance
Focus on acquiring best talent to strengthen the Group
CONFERENCE CALL INFORMATION
The Tinkoff management team will host an investor and analyst conference call at 13:00 UK time (16:00 Moscow time, 8:00 U.S. Eastern Standard Time), on Wednesday, 20 November 2019.
The press release, presentation and financial statements will be available on the Tinkoff website at https://www.tinkoff.ru/eng/ir/financials/quarterly-earnings/
To participate in the conference call, please use the following access details:
A live webcast of the presentation will be available at: https://webcasts.eqs.com/tcsgroup20191120
Please register approximately 10 minutes prior to the start of the call.
About Tinkoff Group
TCS Group Holding PLC is an innovative provider of online retail financial services. It includes Tinkoff Bank, mobile virtual network operator Tinkoff Mobile, Tinkoff Insurance, management company Tinkoff Capital, Tinkoff Software DC, a network of development hubs in major Russian cities, and Tinkoff Education. The Group is currently developing Tinkoff ecosystem, which offers financial and lifestyle services.
The Group was founded in 2006 by Russian entrepreneur Oleg Tinkov and has been listed on the London Stock Exchange since October 2013.
The Group's key business is Tinkoff Bank, a fully online bank that serves around 10 mn customers and forms the core of the Tinkoff ecosystem.
Tinkoff Bank is the second largest player in the Russian credit card market, with a share of 13.2%. The 9M 2019 IFRS net income of TCS Group Holding PLC amounted to RUB 25.1 bn. The ROE was 59%.
With no branches, the Group serves all its customers remotely via online channels and a cloud-based call centre. The centre is staffed by over 10,000 employees, making it one of the largest in Europe. To ensure smooth delivery of the Group's products, the Group has a nationwide network of over 2,500 representatives.
In 2018, Global Finance named Tinkoff Bank the world's Best Consumer Digital Bank, and in 2019, 2018, 2016 and 2015, the Best Consumer Digital Bank in Russia. In 2017 and 2013, the Banker recognised Tinkoff Bank as the Bank of the Year in Russia. The bank's mobile app has been consistently praised by local and global independent experts as the best of its kind (in 2013, 2014, 2015, 2016 by Deloitte and in 2018 by Global Finance).
Some of the information in this announcement may contain projections or other forward-looking statements regarding future events or the future financial performance of the Group and Tinkoff Bank. 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. The Group and Tinkoff Bank wish to caution you that these statements are only predictions and that actual events or results may differ materially. The Group and Tinkoff Bank do 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 the Group and Tinkoff Bank, including, among others, general economic conditions, the competitive environment, risks associated with operating in Russia, rapid technological and market change in the industries the Group operates in, as well as many other risks specifically related to the Group, Tinkoff Bank and their respective operations.
|EQS News ID:||917147|
|End of Announcement||EQS News Service|
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