The Norwegian B2Holding, part of which is Debt Collection Agency (DCA), announced its 2019 Annual Results Report on the 30th of April. For the leading pan-European debt specialist 2019 was a year of successful transformation, driven by the new strategic direction that the company took. The main pillars were profitable growth through focused investments in core markets and strengthening the Group’s servicing capabilities. In addition, special focus was put on the improved use of data and digitalization of services and processes.
B2Holding ended 2019 with total operating revenues amounted of EUR 291.4 mln compared to EUR 295 mln. in 2018, a decrease of EUR 3.22 mln. or 1.3%, due to the portfolio one-off net write-downs of EUR 39.34 mln. The total revenues for the year include EUR 241 mln. from purchased loan portfolios (declined by 5.9% compared to 2018), revenues from external collection amounted to EUR 30.3 mln. (16.8% increase from 2018), and other revenues amounted to EUR 20.1 mln, marking an increase of 61.4% compared to 2018.
Gross cash collections increased in 2019 with EUR 122 mln. or 30.1% to EUR 527.5 mln. due to significant growth in purchased loan portfolios and collection activity. Gross cash collection raised in all geographical segments with a steady cost level, however total revenues for Central and South-East Europe were down from 2018, following the negative net actualization/revaluation charges mainly relating to the one-off write-downs of secured portfolios in Croatia, Bulgaria and Romania in the second quarter of 2019. However, the negative results were compensated by a strong performance during the year’s second half.
The Group’s core business of unsecured loans (67 % of the gross cash collection and 71.8 % of the Estimated Remaining Collection) performed better than expectations with gross collection 6,5 % above the initial forecasted collection curve. The market for unsecured portfolio acquisitions is stable with good pipeline visibility.
Cash EBITDA was EUR 403.8 mln., an increase of 34.89% compared to 2018, while operating profit EBIT dropped by 30.4% to EUR 97 mln.
By year-end 2019 B2Holding reached total face value of purchased loan portfolio of EUR 16,275 mln., adding an investment of EUR 346 mln. for the current year.
“In 2019, we outlined a new strategy for the Group with a stronger focus on our core markets and increased servicing revenues through assets under management, while continuing to improve the effectiveness and efficiency in our operations. Our primary focus has shifted from mainly being a debt investor to also continue our focus on increased debt servicing”, said Erik J. Johnsen, CEO of B2Holding ASA.
A significant step towards increased focus and control was the implementation of a new organizational structure with two business lines: Unsecured (some of which are Norway, Sweden, Denmark, Finland, Poland, Spain, Portugal, Bulgaria, Czech Republic, Hungary) and Secured (among which are Italy, France, Romania, Greece, Slovenia, Croatia, Serbia) markets. The countries are allocated according to their dominant asset class and the expected market potential.
As a leading pan-European debt specialist B2Holding aims to bridge the gap that non-performing loans create in the credit market by finding solutions to debt problems. Honesty, fairness, and ethical collection are fundamentals in the Group’s way of doing business. Following the line of CSR, the goal for 2019, as well as in 2018, was to keep the number of complaints on permanent low level. Indeed, they represented 0.001% of total number of claims.
The full Annual Report 2019 is available here: https://b2holding-annualreport.no/