TIDMKSPI
RNS Number : 1080Q
JSC Kaspi.kz
25 October 2021
Kaspi.kz Announces 3(rd) Quarter 2021 Financial Results
Kazakhstan, 25 October 2021 - JSC Kaspi.kz ("Kaspi.kz", "we", or
the "Company") which operates the Kaspi.kz Super App, Kazakhstan's
leading mobile Super App, today publishes its unaudited
consolidated IFRS financial results for the quarter ending 30
September 2021.
Key highlights
-- Super App DAU increased 50% year-over-year to 6.5 million, a
substantially faster rate than MAU, which increased by 27%
year-over-year to 10.8 million, with the ratio of DAU to MAU now
60%.
-- Average monthly transactions per active consumer increased by
94% year-over-year to a record 45.3.
-- Following its hugely successful launch last year, Kaspi Pay
continues to scale at an incredible rate, significantly increasing
the number of merchants engaged in the Kaspi Ecosystem.
o Active merchants increased 417% year-over-year to reach
182K.
o 215K active Kaspi Pay POS devices by September 2021, up 10x
year-over-year.
o By number of transactions, Kaspi Pay acquiring accounted for
75% of all Kaspi.kz in-store purchase transactions during 3(rd)
quarter of 2021, with third-party acquiring down to just 25%.
o Consumers continue to embrace Kaspi Pay's contactless Kaspi QR
technology. Number of in-store transactions using Kaspi Pay
acquiring increased 13.6x year-over-year, with Kaspi QR accounting
for 83% of all in-store transactions in the 3rd quarter of
2021.
o Currently, only 43% of total merchants are using services on
both our Payments and Marketplace Platforms. We expect a larger
Payments Platform merchant base to in turn drive another step-up in
Marketplace merchant growth.
-- Only 40% of consumers use all three of our platforms, which
provides another significant growth opportunity.
-- In e-Commerce we continue to scale Kaspi Smart Logistics
Platform, with total deliveries up 138% year-over-year, 52% of
orders delivered within <=2 days and 97% of deliveries free for
consumers.
o We have launched Kaspi Express Delivery and in September
around 10% of orders in Almaty were delivered in less than 3
hours.
o We have started to roll out Kaspi Postomat locker network,
which will further enhance Kaspi Smart Logistics value proposition
for consumers, merchants and delivery partners.
-- Kaspi Travel hit another milestone with over 1mn tickets sold in the 3rd quarter, up 112% quarter-over-quarter, fueled by growth in both airline and railway ticket sales.
-- We continue working hand in hand with state bodies to make
government services accessible to all citizens. Distribution of
pensions and social benefits for newborns added. MAU of GovTech in
our Super App increased 4.1x year-over-year, taking total monthly
users to 7 million.
-- Payments RTPV increased 103% year-over-year, increasing at a
faster rate than TPV for the first time.
-- Marketplace total GMV increased 134% year-over-year.
o m-Commerce GMV up 294% year-over-year.
o e-Commerce GMV up 69% year-over-year.
-- Fintech TFV increased 174% year-over-year.
-- Payments adj. net income [1] up 111% year-over-year and
record 64% adj. net income margin.
-- Marketplace adj. net income up 201% year-over-year and record 68% adj. net income margin.
-- Fintech adj. net income up 55%, adj. net income margin up to
43% and 77% ROE for 9 months 2021.
-- Kaspi.kz adj. net income up 90% year-over-year and record 52% adj. net income margin.
-- Proposed 3(rd) quarter dividend of 468KZT per GDR, equivalent
to around KZT90 billion, subject to shareholder approval.
-- Upgrading Payments RTPV growth to around 105% year-over-year.
-- Upgrading Marketplace GMV growth to around 110%
year-over-year. Take rate guidance increases to around 8.5%.
-- Upgrading Fintech TFV growth to above 125% year-over-year, with cost of risk below 2%.
-- Upgrading Kaspi.kz 2021 adj.net income guidance to around
KZT445 billion. This compares with guidance of around KZT425
billion, provided at our last results update in July.
-- Acquisition of 100% of Portmone Group completed. Portmone
gives us a solid starting platform in Ukraine with a 1) National
Bank of Ukraine payments license, 2) Visa & Mastercard
accreditation and 3) relationships with thousands of merchants and
a wide pool of banks.
-- SPA to acquire 100% of BTA Bank Ukraine signed. This bank has
very limited operating activity, no branches, no loan portfolio and
is solely acquired for full banking license purposes only, enabling
us to launch mobile wallets, accounts and provide consumers with
payments and fintech products. The proposed acquisition will have
no material financial impact on Kaspi.kz and is expected to close
in the first half of 2022.
-- With a banking license and Portmone's payments licenses we
are well positioned to replicate our Super App strategy in
Ukraine.
To the Shareholders of Kaspi.kz:
On the heels of our record first half, we are reporting an
excellent 3(rd) quarter - indicative of the strength and breadth of
the Kaspi.kz Super App business model. The Kaspi.kz team keeps
demonstrating extraordinary execution by delivering again and again
for our customers, Kazakhstan and our shareholders.
We previously stated that our no.1 goal this year is to
substantially scale our merchant base, primarily via the roll out
of Kaspi Pay and Kaspi QR. During the 3(rd) quarter of 2021, we
continued to drive massive growth in active merchants, up 417%
year-over-year. The opportunity ahead remains substantial and now
we're also seeing a significant acceleration in Marketplace
merchant onboarding. With only 43% of merchants available on both
our Payments and Marketplace Platforms, there is still a lot we can
do to help merchants accelerate their growth.
With an expanded merchant base our consumers are using the
Kaspi.kz Super App more than ever. Engagement levels once again hit
record highs, with average transactions per consumer nearly
doubling to 45 transactions per month. Just to put this number into
perspective, PayPal reports 44 transactions per year - twelve times
less! We have best in class engagement by global standards but with
only 40% of our consumers using all three of our platforms, here
too there is still more opportunity. We will continue to strengthen
our consumer value proposition and increase our relevance to
consumers' and merchants' everyday lives.
Over the summer we launched Express Delivery in less than 3
hours and Kaspi Postomat self-service locker network, our two
latest additions to the Kaspi Smart Logistics Platform. Kaspi Smart
Logistics Platform already delivers 52% of orders within 48 hours,
almost entirely free for the buyer. In September around 10% of
orders in Almaty, the largest city in Kazakhstan, were delivered in
less than 3 hours through our new Express Delivery service. As we
rollout Kaspi Postomat and Express Delivery this and next year,
Kaspi Smart Logistics will bring even more value to our consumers,
merchants and delivery partners.
Strong consumer and merchant trends in turn drive rapid
financial growth and in the 3(rd) quarter all three of our
platforms delivered standout results across every performance
metric. As a result, we're upgrading our 2021 Payments, Marketplace
and Fintech KPIs. We're also pleased to upgrade our Kaspi.kz
consolidated net income guidance for the third time this year and
now expect adj. 2021 net income of around KZT445 billion.
Globally we are all embracing all things digital economy and
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 to capture the multi-year
structural growth opportunity offered by digitalisation in
Kazakhstan.
With today's proposed acquisition of a banking license in
Ukraine and following the successful acquisition of Portmone, we're
also starting to put in place the foundations for Kaspi.kz to play
a leading role in the broader region's digital transformation. We
have the right strategy and our incredible team knows how to
execute. We have recently expanded our equity based long-term
incentive program to 74 key team members and I'm delighted that
they along with our shareholders will be able to increasingly share
in our success .
With many exciting plans we remain as optimistic about the
future as ever!
Thank you for being our shareholder.
Mikheil Lomtadze
Kaspi.kz CEO and co-founder
10.8 million Kaspi.kz Super App users. Engagement at all-time
highs
DAU up 50% to 6.5 million, 60% DAU to MAU, avg. 45.3
transactions per consumer/month
Kaspi.kz's Super App serves as a single gateway to our Ecosystem
and gives our Payments, Marketplace and Fintech Platforms
unrivalled competitive advantages. During the 3(rd) quarter of
2021, Super App user and engagement levels continued to reach
all-time highs.
DAU (Daily Active Users) increased 50% year-over-year to 6.5
million, a substantially faster rate than MAU (Monthly Active
Users), which increased by 27% year-over-year to 10.8 million.
Highly discoverable digital transaction linked products and
services ensure the Kaspi.kz Super App is integral to consumers'
daily lives. The ratio of DAU to MAU reached 60%, which is amongst
the highest levels of user engagement of any Super App globally and
another step-up, compared to 51% during the 3rd quarter of
2020.
Engagement is closely tied to one of our most important
strategic objectives, namely, to facilitate digital transactions
across all areas of the typical household's spending. Average
monthly transactions per active consumer increased by 94%
year-over-year to 45.3 from 23.4 during the 3rd quarter of
2020.
To drive engagement and transaction levels even higher, our top
strategic priority is to onboard as many merchants, as rapidly as
possible. During the 3rd quarter of 2021, growth in total number of
active merchants accelerated again to 417% year-over-year and
reached 182K. Only 43% of merchants are available on both our
Payments and Marketplace Platforms, representing a substantial
future growth opportunity. However, we're now seeing that a high
number of Payments Platform merchants are going on to become
m-Commerce and e-Commerce merchants, enhancing the breadth and
depth of their relationship with the Kaspi.kz Ecosystem.
A large and compelling merchant base, combined with high quality
and innovative digital products in turn drives consumer engagement
and transactions across all our platforms. Consumers active on all
three Kaspi.kz platforms reached 40%, which is an increase from 35%
at just the beginning of this year and 33% in the 3rd quarter of
2020.
We will also continue to launch new products and services and
the success of Kaspi Travel, demonstrates that a large and highly
engaged Super App consumer and merchant base can be leveraged into
new sizeable and fast-growing markets. Kaspi Travel sales soared to
over 1 million tickets during the 3rd quarter 2021, up 112%
quarter-over-quarter. GMV reached KZT25,663 million and take-rate
was 3.3% during the 3rd quarter 2021.
Underpinned by the continued success of Kaspi Pay we continue to
see multiple opportunities across all aspects of our Ecosystem to
drive consumer, merchant, engagement and transaction growth well
into the future.
Kaspi.kz 3Q financial highlights
Adj. net income up 90% YoY. Payments and Marketplace 50% of adj.
cons. net income
During the 3(rd) quarter of 2021, total revenue growth remained
rapid, increasing by 55% year-over-year to reach KZT250,596
million. Every platform delivered a strong performance with rapid
top-line growth and improving year-over-year profitability.
Our Payments Platform, despite a long track record of
consistently high growth, continues to surprise on the upside due
to the mass adoption of Kaspi Pay. Having significantly expanded
our Marketplace merchant base, m-Commerce GMV trends are very
strong, while e-Commerce continues to deliver consistently high
growth. Fintech is rapidly scaling origination, which in turn leads
to accelerating revenue growth.
During the 3rd quarter of 2021, adj. net income increased 90%
year-over-year to KZT130,501 million. Adj. net income margin
increased to 52.1% from 42.5% during the same quarter in 2020.
As our proprietary payments network scales, we continue to
eliminate third-party costs, as well as benefitting from our
Payments Platform's operational gearing. Marketplace Platform is
also seeing the benefits of its inherent operational gearing,
despite the rollout of free delivery for consumers. Our Fintech
Platform's profitability is improving as top-line growth returns at
scale, combined with improving cost of risk.
For the first 9 months of 2021, total revenue reached KZT647,646
million, equivalent to a 41% year-over-year increase. Adj. net
income increased 69% year-over-year to KZT311,512 million,
equivalent to a 48.1% adj. net income margin, up from 40% in the
first 9 months of 2020.
Our net income mix continues to transform quickly and in the
first 9 months of 2021 our faster growing Payments and Marketplace
Platforms accounted for 50% of net income, up from 34% in the same
period in 2020. We continue to expect Payments and Marketplace to
account for the majority of our full-year 2021 adj. net income.
Our cash generation capacity remains as strong as ever. As has
been the case previously, we seek to maintain a 50bps buffer above
local NBK capital adequacy requirements but thereafter will
consider returning excess cash to shareholders and/or M&A that
would allow us to scale our addressable markets further.
For the 3(rd) quarter of 2021, our Board of Directors has
proposed a 468KZT per GDR dividend equivalent to around KZT90
billion, subject to shareholder approval.
Payments Platform
RTPV up 103% and for the first time grows faster than TPV,
revenue up 72% & adj. net income up 111% YoY
Our Payments Platform has always offered consumers a highly
convenient way to shop, pay bills and make peer-to-peer (P2P)
payments via the Kaspi.kz Super App. As has been the case globally,
in Kazakhstan there has been a massive shift to digital payments,
with consumers demanding a seamless and integrated digital
experience no matter where they shop. The Kaspi Pay App is our
response to help merchants digitalise their businesses and exceed
customers' expectations.
Payments Platform is also amongst our most important tools to
attract new consumers and increase engagement, making it
illustrative of the health of the broader Kaspi.kz Ecosystem. With
this in mind, we continue adding new opportunities to spend and
pay, which is a function of new merchants and product
development.
In the 3rd quarter of 2021, we accelerated merchant onboarding
again, up 521% year-over- year to 179.8K merchants. The benefits of
this will be seen in subsequent quarters as new merchants shift
more of their volumes to Kaspi Pay.
As we give our consumers new opportunities to pay, consumer
growth has remained robust. Payments Platform active consumers
increased 28% year-over-year, to reach 9.3 million, in the 3rd
quarter of 2021.
By creating our own closed-loop proprietary payments network, we
have eliminated the need for third-party processors and our
Payments Platform offers merchants and consumers at scale, a
complete end-to-end experience. The result is that over the last 12
months Kaspi Pay has firmly established itself as a major
disruptive force, becoming the digital payments platform of choice
for all types of merchants in Kazakhstan.
By September 2021, there were 215K active Kaspi Pay POS devices,
up 10.0x year-over-year. This unique and disruptive proposition,
resulted in Kaspi Pay acquiring accounting for 75% of all Kaspi
Gold POS in-store retail transactions during 3rd quarter of 2021,
with third-party acquirers now only processing 25% of our
transactions.
Consumers continue to swiftly embrace Kaspi Pay's contactless
Kaspi QR technology. Number of transactions using Kaspi Pay POS
Solutions increased 13.6x year-over-year, with QR accounting for
83% of transactions in the 3rd quarter 2021. In future quarters, we
expect further strong growth in the number of active Kaspi Pay POS
devices and even higher growth in engagement, as evidenced by the
number of transactions.
During the 3rd quarter of 2021, Total Payment Value (TPV)
increased by 102% year- over-year to reach KZT14.2 trillion.
Revenue Generating TPV (RTPV) increased 103% to reach KZT3.5
trillion. This is the first time RPTV has grown faster than TPV and
is a direct result of our success rolling our Kaspi POS
devices.
Average balances increased 58% year-over-year to KZT571 billion.
Consumers move funds to Kaspi.kz to facilitate future transactions
and rapid growth in account balances is an encouraging lead
indicator for future RTPV growth.
During the 3rd quarter of 2021, Payments Platform revenue grew
by 72% year-over-year to reach KZT58,490 million. For the 9 months
of 2021, Payments Platform revenue increased 79% year-over-year to
reach KZT148,176 million. Take-rate in the 3rd quarter and first 9
months of 2021 was 1.2% in line with our 2021 full-year guidance of
around 1.2%.
Payments Platform adj. net income increased by 111%
year-over-year to KZT37,506 million, with net income profitability
of 64.1% up significantly from 52.3% in the 3rd quarter of 2020.
Payments Platform profitability continues to benefit from cost
savings as we transition payment volumes away from third-party
network providers to our own proprietary payments network, combined
with the platforms operational gearing. For the first 9 months of
2021, Payments Platform adj. net income increased 117%
year-over-year to KZT90,232 million, with net income profitability
of 60.9% up from 50.4% in the same period in 2020.
For the remainder of 2021 we will continue to aggressively
ramp-up our merchant base and expect this to 1) contribute to
ongoing strong growth in RTPV, 2) a more diverse mix of Payments
Platform revenue streams and 3) higher profitability as our
proprietary network disintermediates third-party costs.
With Payments Platform KPIs and financials continuing to deliver
on the upside we are upgrading our 2021 guidance and now expect
RTPV growth of around 105% year-over-year, up from around 100%
previously. We continue to expect adj. net income profitability to
be around 60%.
Kaspi Pay is only 12 months into its journey and we remain
extremely positive about the outlook for our Payments Platform for
the remainder of 2021 and beyond.
For us Kaspi Pay's initial success is just the start of a
multi-year strategy, as we set out to transform commerce for
merchants. With all consumer and merchant metrics showing rapid
momentum, we're in an incredibly strong position to lead the
digital transformation of payments and shopping in Kazakhstan and
over time across the wider region.
Marketplace Platform
m-Commerce GMV up 294%, e-Commerce GMV up 69% & adj. net
income up 201% YoY
Our Marketplace Platform connects both online and offline
merchants with consumers, enabling merchants to increase their
sales using an omnichannel strategy and consumers to buy a broad
selection of products and services from a wide range of 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. Taken together a unified shopping experience,
irrespective of online or offline is a major competitive advantage
and makes our Marketplace relevant across all areas of consumer
spending.
Just as with our Payments Platform, the rapid expansion of our
Marketplace merchant base is an important strategic priority. We're
focused on digitally onboarding Kaspi Pay merchants to Marketplace
and during the 3(rd) quarter of 2021, Marketplace merchants
increased to 81.3K, an acceleration to 187% year-over- year growth.
Over the same period, Marketplace consumers growth accelerated to
40% year-over-year to 4.1 million. We expect merchant growth to
remain at elevated levels in the final quarter of the year, with
more merchants leading to fast growth in consumers and GMV per
consumer over the mid-term.
Our Marketplace platform mix continues to rapidly evolve in line
with our strategic objective of a broadly balanced contribution
from e-Commerce and m-Commerce. In the 3(rd) quarter of 2021,
e-Commerce and m-Commerce accounted for 42% and 58% of GMV
respectively.
During the 3(rd) quarter of 2021 Marketplace GMV increased 134%
year-over-year to KZT483,074 million. m-Commerce had an excellent
quarter and delivered 294% year-over- year GMV growth due in part
to Kaspi Pay merchants subsequently onboarding to m-Commerce.
e-Commerce GMV growth remained rapid and was up 69% year-over-year,
with growth in items sold up 121% year-over-year.
Kaspi Travel's GMV reached KZT25,663 million and KZT48,859
million during the 3rd quarter and first 9 months of 2021
respectively. Although not included in Marketplace GMV, this is
equivalent to just over 5% of GMV in the 3(rd) quarter of 2021,
which is an impressive level of scale given that we only launched
Kaspi Travel in the 3(rd) quarter of 2020. We will continue to
broaden Kaspi Travel's product proposition and combined with the
general recovery in international travel, the outlook for Kaspi
Travel is very exciting. Kaspi Travel's take-rate was 3.3% and 3.1%
for the 3(rd) quarter and first 9 months of 2021, respectively.
The expansion of Kaspi Smart Logistics Platform to more cities
and introduction of free delivery for consumers has made an
important contribution to strong e-Commerce trends. In the 3(rd)
quarter of 2021, delivery volumes increased 138%
year-over-year.
We recently launched Kaspi Express Delivery and in September
around 10% of orders in Almaty were delivered in 3 hours or
less.
During the 3(rd) quarter we also started to roll out of Kaspi
Postomat, with around 300 lockers expected to be launched over the
next couple of months. Kaspi's proprietary big data is helping us
identify the most appropriate locations and our ambition is to
build Kazakhstan's largest locker network over the medium-term. We
expect Kaspi Postomat to result in cost savings of at least 20% vs.
to-door delivery, reduce the number of failed deliveries, with
benefits to the environment from lower pollution and
congestion.
At scale, the addition of Kaspi Postomat and Kaspi Express
Delivery to the Kaspi Smart Logistics Platform will significantly
enhance Kaspi Smart Logistics value proposition for consumers,
merchants and delivery partners.
A 100bps year-over-year increase in take-rate to 8.4% in the
3(rd) quarter of 2021 resulted in Marketplace revenue growing
significantly faster than GMV, increasing 160% year-over-year to
KZT41,657 million. Higher take-rate is the result of ongoing mix
shift away from consumer electronics, the success of our
promotional activities and to a lesser extent Kaspi Logistics and
Kaspi Marketing Services, which are at very early stages of
monetization. For the first 9 months of 2021, Marketplace Platform
revenue increased 183% year-over-year to reach KZT99,400 million.
Take-rate in the first 9 months of 2021 was 8.3%, up 135bps
year-over-year.
During the 3(rd) quarter of 2021, Marketplace Platform adj. net
income reached KZT28,470 million, representing a 201% increase
year-over-year. Net income profitability increased to 68.3% from
59.1% in the same period in 2020. Higher profitability resulted
from higher take-rate, Marketplace Platform's high operational
gearing and was achieved despite the ramp-up in free consumer
delivery.
For the first 9 months of 2021, Marketplace adj. net income
increased 235% year-over- year to reach KZT65,994 million. Net
income profitability increased to 66.4% from 56.0% in the same
period in 2020.
For 2021 we now expect higher Marketplace GMV growth of around
110% year-over-year, up from around 100% previously. Full-year 2021
Marketplace take-rate is now expected to be around 8.5%, up from
our previous guidance of around 8%. We continue to expect adj. net
income profitability to be in the high 60% range.
Going forward, we believe the breadth and depth of our merchant
proposition is one of the most important drivers of GMV/consumer
growth and our long-term competitive advantage. In this regard, we
expect to continue merchant onboarding at elevated levels. With an
enhanced merchant offering and Kaspi Smart Logistics continuing to
scale, we expect to see strong Marketplace GMV growth in the final
months of 2021, with high growth and profitability sustainable well
into the mid-term.
Fintech Platform
TFV up 174% YoY, Buy-Now-Pay-Later 39% of origination, FY21 CoR
now guided below 2.0%
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 the consumer
environment. During the 3(rd) quarter of 2021, Total Finance Value
(TFV) increased 174% year-over-year to an all-time high KZT1.2
trillion. This is faster than we had previously guided for due to
stronger than expected Marketplace GMV growth and an increasingly
favourable consumer backdrop.
Our average net loan portfolio increased by 56% year-over-year,
reaching KZT1.9 trillion during the 3(rd) quarter of 2021. Overall
loan portfolio growth significantly below TFV growth is one of the
benefits of our Super App origination strategy. Our consumers can
take exactly what they need, via seamlessly integrated Fintech
Platform products at the point of purchase and conveniently repay
whenever they want commission and penalty free. This results in
growth in origination above average portfolio growth, lower cost of
risk and more transactions on our Marketplace and Payments
Platforms. For our consumers, in addition to convenience they carry
lower levels of total indebtedness. Higher portfolio conversion of
2.3x in the 3(rd) quarter of 2021, up from 2.0x and 1.4x in the 2nd
quarter of 2021 and 3rd quarter of 2020 respectively, also reflects
higher early repayments levels, as a healthy consumer once again
transacts normally. With consumer trends continuing to improve and
our focus on low ticket origination we expect portfolio conversion
to remain rapid throughout the remainder of 2021 and into next
year.
BNPL and general purpose loans now account for broadly similar
shares of TFV, 39% and 43% respectively during the 3(rd) quarter
2021. Our new Merchant and Micro Business Finance products continue
to gain traction quickly, accounting for 7% of TFV in the 3(rd)
quarter of 2021. Yield was 29.8% during both the 3(rd) quarter and
first 9 months of 2021 respectively. We expect to deliver a full
year 2021 Fintech yield of around 30%, which is consistent with our
guidance throughout 2021.
During the 3(rd) quarter of 2021 our underlying credit related
cost of risk improved to 1.5% from 2.7% (pre-macro factor
adjustment) in the 3(rd) quarter of 2020. Improving cost of risk,
despite significantly higher origination reflects ongoing
improvements in our data driven origination capabilities, as well
as our efforts to constantly improve the efficiency of our
collection processes. With our origination and collection
capabilities continuing to improve, we now target full- year 2021
CoR below 2.0%, which is an improvement on our previous guidance of
around 2% and initial guidance at the start of 2021 of below
3%.
Fintech Platform revenue increased by 35% year-over-year,
reaching KZT150,449 million during the 3(rd) quarter of 2021 and
increased by 17% year-over-year to reach KZT400,070 million during
the first 9 months of 2021. Lower yielding Buy-Now-Pay- Later
(BNPL) and Merchant Finance products slightly muted Fintech revenue
growth, but these trends were in line with our internal goals and
with origination now on track to grow above 125% year-over-year in
2021, revenue growth will continue to accelerate in subsequent
quarters.
In the 3(rd) quarter of 2021, Fintech Platform's adj. net income
increased by 55% year-over-year to reach net income of KZT64,525
million, with adj. net income margin reaching 42.9% from 37.2% in
the 3(rd) quarter of 2020. For the first 9 months of 2021 adj. net
income increased by 26% year-over- year to reach KZT155,286
million, with adj. net income margin reaching 38.8% from 35.9% in
the same period in 2020. Fintech Return on Equity[2] during the
first 9 months of 2021 remained extremely healthy at 77.2%.
Assuming the macro-backdrop continues to improve for the
remainder of 2021, we expect elevated TFV origination. Although we
will continue to prioritise our BNPL product, just under 10% of TFV
will come from our recently launched merchant financing and SME
Fintech products.
For 2021 we now expect TFV origination of above 125%
year-over-year, which is an increase compared to our previous
around 110% growth guidance. We continue to expect yield to be
around 30%, which is in line with our assumptions throughout this
year but with CoR now below 2.0%, which is better than our previous
guidance of around 2.0% and despite higher origination. The result
should be net income profitability in the high-30% range, which is
consistent with previous guidance of high-30%.
Acquisition of Portmone Group completed. Banking license in
Ukraine to be acquired
On 8 October 2021 Kaspi Pay, a 100% owned subsidiary of JSC
Kaspi.kz announced that it had completed the acquisition of 100%
Ukrainian payments company Portmone Group. The acquisition of
Portmone gives Kaspi.kz a payments license and Visa and Mastercard
accreditation in Ukraine. The consolidation of Portmone Group is
not expected to have any material impact on Kaspi.kz's 2021
financial results.
We have entered into SPA to acquire 100% of BTA Bank Ukraine.
This bank has very limited operating activity, no branches, no loan
portfolio and is solely acquired for full banking license purposes
only, enabling us to launch mobile wallets, accounts and provide
consumers with payments and fintech products. The proposed
acquisition will have no material financial impact on Kaspi.kz and
is expected to close in the first half of 2022.
With banking license and Portmone's payment licenses we are in a
strong position to replicate our Super App strategy in Ukraine.
Ukraine is a 42 million population opportunity, characterised by
high cash penetration (44% cash withdrawals), low e-Commerce
penetration (8% of retail), low unsecured consumer lending (less
than 4.5% of GDP) and high smartphone penetration (over 70%).
In the medium-term, Ukraine can also become an important source
of IT talent and a development hub for Kaspi.kz.
Share-based compensation expanded and now includes 74 key
employees
Following our IPO, we introduced an LTIP program in 2020. In
September 2021, the program was expanded to include 74 senior
executives and other key personnel, who will receive Kaspi.kz share
options. Awards are payable in annual instalments over a five-year
vesting schedule.
Our initial 2020 program in part included phantom based shares.
However, we have now replaced these with equity settled awards,
with the aim of better aligning the interests of participants with
the long-term interests of Kaspi.kz and its shareholders.
Amortisation of share-based compensation during the 3(rd)
quarter of 2021 amounted to KZT5,295 million and for the first 9
months of 2021 KZT13,746 million. For full-year 2021 we expect
amortisation of share-based compensation to be around KZT19.5
billion.
In March 2021, share options in the quantity of 382,223 shares
were exercised from treasury shares under the share-based LTIP
plan. Total shares outstanding as at 30 September 2021 were
192,187,223.
Outstanding share options as at 30 September 2021 were
2,154,082.
Shares in JSC Kaspi.kz to be listed on AIX
In addition to the listing of its common shares on the
Kazakhstan Stock Exchange, Kaspi.kz has applied for and expects its
common shares to be admitted for listing on the Astana Stock
Exchange (AIX), commencing Tuesday, October 26(th) 2021. This
listing will provide additional convenience to our shareholders to
hold and trade our common shares directly. Shares listed on AIX are
exempt from withholding tax on dividends.
Conference call information
On 25 September 2021 Kaspi.kz will host a conference call and
webcast at 1.00pm (London) (8.00am U.S. Eastern Time, 6.00pm
Nur-Sultan time) to review and discuss the company's results for
the 3(rd) quarter of 2021. To pre- register for this call, please
go to the link below. You will receive your access details via
email.
https://www.incommglobalevents.com/registration/client/8837/3q21-conference-call/
About Kaspi.kz
Kaspi.kz's mission is to improve people's lives by developing
innovative mobile products and services. At our core is the
Kaspi.kz Super App, the leading mobile app in Kazakhstan.
The Kaspi.kz Super App serves as a single gateway to our
Payments, Marketplace and Fintech Platforms and is an integral part
of our users' daily lives. As people's lives become increasingly
digitalised, Super App usage is expected to grow supported by
accelerating adoption of cashless payments, e-Commerce and digital
financial services.
Kaspi.kz operates an Ecosystem business model, where the growth
and development of one service contributes to the growth and
development of other services, creating a powerful virtuous cycle.
Increasing usage of a growing number of services puts Kaspi.kz in a
strong position to keep 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
Kaspi.kz Consolidated Income Statement
3Q 3Q 3Q 2021
9M 2020, 9M 2021, 9M 2021 2020, 2021, ADJUSTED,
KZT KZT ADJUSTED, KZT KZT KZT
MM MM KZT MM MM MM MM
----------------------------- ----------- ----------- ----------- --------- --------- -----------
Revenue 460,859 647,646 647,646 161,763 250,596 250,596
----------------------------- ----------- ----------- ----------- --------- --------- -----------
growth, % - - 41% - - 55%
----------------------------- ----------- ----------- ----------- --------- --------- -----------
Interest Revenue 239,077 298,196 298,196 82,393 112,594 112,594
----------------------------- ----------- ----------- ----------- --------- --------- -----------
Fees, Commissions
& Other 126,553 136,188 136,188 39,663 51,302 51,302
----------------------------- ----------- ----------- ----------- --------- --------- -----------
Transaction & Membership
Revenue 64,182 119,705 119,705 26,417 47,149 47,149
----------------------------- ----------- ----------- ----------- --------- --------- -----------
Seller fees 33,355 96,548 96,548 15,218 40,341 40,341
----------------------------- ----------- ----------- ----------- --------- --------- -----------
Other gains and
losses (2,308) (2,991) (2,991) (1,928) (790) (790)
----------------------------- ----------- ----------- ----------- --------- --------- -----------
Cost of revenue (145,469) (177,174) (176,465) (51,967) (62,500) (62,159)
----------------------------- ----------- ----------- ----------- --------- --------- -----------
growth, % - - 21% - - 20%
----------------------------- ----------- ----------- ----------- --------- --------- -----------
% of revenue 31.6% 27.4% 27.2% 32.1% 24.9% 24.8%
----------------------------- ----------- ----------- ----------- --------- --------- -----------
Interest Expenses (100,883) (126,269) (126,269) (36,503) (43,494) (43,494)
----------------------------- ----------- ----------- ----------- --------- --------- -----------
Transaction Expenses (11,061) (11,015) (11,015) (4,074) (4,213) (4,213)
----------------------------- ----------- ----------- ----------- --------- --------- -----------
Operating Expenses (33,525) (39,890) (39,181) (11,390) (14,793) (14,452)
----------------------------- ----------- ----------- ----------- --------- --------- -----------
Total net revenue 315,390 470,472 471,181 109,796 188,096 188,437
----------------------------- ----------- ----------- ----------- --------- --------- -----------
growth, % - - 49% - - 72%
----------------------------- ----------- ----------- ----------- --------- --------- -----------
margin, % 68.4% 72.6% 72.8% 67.9% 75.1% 75.2%
----------------------------- ----------- ----------- ----------- --------- --------- -----------
Technology & product
development (18,653) (30,929) (24,802) (6,558) (10,964) (8,530)
----------------------------- ----------- ----------- ----------- --------- --------- -----------
Sales and marketing (31,108) (41,330) (41,314) (13,295) (12,346) (12,330)
----------------------------- ----------- ----------- ----------- --------- --------- -----------
General and administrative
expenses (10,174) (16,571) (9,677) (3,452) (5,545) (3,041)
----------------------------- ----------- ----------- ----------- --------- --------- -----------
Provision expense (34,550) (22,899) (22,899) (4,455) (8,196) (8,196)
----------------------------- ----------- ----------- ----------- --------- --------- -----------
Operating income 220,905 358,743 372,489 82,036 151,045 156,340
----------------------------- ----------- ----------- ----------- --------- --------- -----------
growth, % - - 69% - - 91%
----------------------------- ----------- ----------- ----------- --------- --------- -----------
margin, % 47.9% 55.4% 57.5% 50.7% 60.3% 62.4%
----------------------------- ----------- ----------- ----------- --------- --------- -----------
Income tax (36,522) (60,870) (60,977) (13,232) (26,236) (25,839)
----------------------------- ----------- ----------- ----------- --------- --------- -----------
Net income 184,383 297,873 311,512 68,804 124,809 130,501
----------------------------- ----------- ----------- ----------- --------- --------- -----------
growth, % - - 69% - - 90%
----------------------------- ----------- ----------- ----------- --------- --------- -----------
margin, % 40.0% 46.0% 48.1% 42.5% 49.8% 52.1%
----------------------------- ----------- ----------- ----------- --------- --------- -----------
Kaspi.kz Consolidated Balance Sheet
31-Dec-2020, 30-Sep-2021,
KZT MM KZT
MM
------------------------------------------ ------------ ------------
Cash and cash equivalents 330,409 235,720
------------------------------------------ ------------ ------------
Mandatory cash balances with NBK 27,659 32,869
------------------------------------------ ------------ ------------
Due from banks 44,259 54,536
------------------------------------------ ------------ ------------
Investment securities and derivatives 869,572 839,261
------------------------------------------ ------------ ------------
Loans to customers 1,404,554 2,086,208
------------------------------------------ ------------ ------------
Property, equipment and intangible
assets 70,016 74,229
------------------------------------------ ------------ ------------
Other assets 51,645 64,257
------------------------------------------ ------------ ------------
Assets classified as held for
sale 8,628 -
------------------------------------------ ------------ ------------
Total assets 2,806,742 3,387,080
------------------------------------------ ------------ ------------
Due to banks - 26,396
------------------------------------------ ------------ ------------
Customer accounts 2,150,581 2,649,397
------------------------------------------ ------------ ------------
Debt securities issued 139,111 136,232
------------------------------------------ ------------ ------------
Payables to shareholders 360 -
------------------------------------------ ------------ ------------
Other liabilities 40,983 54,795
------------------------------------------ ------------ ------------
Subordinated debt 78,009 65,990
------------------------------------------ ------------ ------------
Liabilities directly associated
with the assets classified as
held for sale 3,038 -
------------------------------------------ ------------ ------------
Total liabilities 2,412,082 2,932,810
------------------------------------------ ------------ ------------
Share capital 95,825 97,530
------------------------------------------ ------------ ------------
Additional paid-in-capital 506 506
------------------------------------------ ------------ ------------
Revaluation reserve of financial
assets 5,171 5,581
------------------------------------------ ------------ ------------
Share-Based Compensation reserve 8,788 14,822
------------------------------------------ ------------ ------------
Retained earnings 280,828 331,431
------------------------------------------ ------------ ------------
Total equity attributable to Shareholders
of the Company 391,118 449,870
------------------------------------------ ------------ ------------
Non-controlling interests 3,542 4,400
------------------------------------------ ------------ ------------
Total equity 394,660 454,270
------------------------------------------ ------------ ------------
Total liabilities and equity 2,806,742 3,387,080
------------------------------------------ ------------ ------------
([1]) Net income adjusted for share-based compensation
([2]) Calculated as ratio of Fintech's net income to avg. equity
of Kaspi.kz adjusted for net income attributable to Payments and
Marketplace segments.
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