Aprila Bank (APRILA) Q3 2024 earnings summary

Executive summary

• Total income grew 32% year-on-year in Q3 to NOK 55.1 million, with gross lending up 29% to NOK 1,111 million and credit line lending up 36%.

• Pre-tax profit reached NOK 9.2 million, impacted by a NOK 2.7 million one-off severance cost; ROE was 13% for Q3 and 15.2% for the last 12 months, rising to 16.8% excluding the one-off.

• Down Payment Loan launched, completing the direct credit product portfolio and enhancing long-term financing options for customers.

• Unique business customers declined 18% year-on-year due to discontinuation of spot factoring.

• CET1 ratio stood at 31.2% as of 30 September 2024, well above the 22.9% capital requirement.

Financial highlights

• Net interest income for Q3 2024 was NOK 48.0 million, up from NOK 35.4 million in Q3 2023.

• Loan losses totaled NOK 15.6 million in Q3, with NOK 13.5 million in provisions and NOK 2.0 million in net realized losses.

• Cost/income ratio improved to 46% in Q3 2024, down from 57% in Q3 2023.

• Earnings per share for Q3 2024 were NOK 0.13, up from NOK 0.12 in Q3 2023.

• Total income for the last 12 months reached NOK 202 million, up 42% year-on-year.

Outlook and guidance

• Priorities for 2024 include accelerating growth, strengthening competitive advantage, and improving long-term profitability.

• Guidance for cost/income ratio improved to 46%; pre-tax profit for 2023 expected to be close to NOK 40 million, above initial forecast.

• Targeting a total income run-rate of approximately NOK 225 million by year-end 2024.

• Credit line accounts expected to reach around 5,600 by year-end, with increased marketing and sales capacity.

• AI adoption and business model scalability expected to drive improved ROE.