Gentera (GENTERA) Q2 2024 earnings summary

Executive summary

• Served 5.39 million clients in 2Q24, with credit clients up 16.8% year-over-year to 4.13 million and a record loan portfolio of MXN 68.863 billion, up 19.3% year-over-year.

• Net income for 1H24 was MXN 2.8 billion, up 13.4% year-over-year, marking the best semester ever.

• EPS for 2Q24 was MXN 0.75, a 10.6% increase year-over-year; controlling company net income for 2Q24 was MXN 1.185 billion.

• Over 64 million insurance policies placed in 1H24, more than 2.5x the prior year, with ongoing ESG and social impact initiatives.

• Digital transformation and modernization strategies are improving efficiency, customer experience, and operational focus.

Financial highlights

• Interest income in 2Q24 rose 24% year-over-year to MXN 9.693 billion; net interest income after provisions increased 8.1% to MXN 5.51 billion.

• Provisions for loan losses surged 59.7% year-over-year in 2Q24, reflecting portfolio growth and higher early NPLs.

• Operating expenses for 1H24 were MXN 9.216 billion, up 13% year-over-year, mainly due to sales force and infrastructure investments.

• Net fees increased 70% year-over-year in Q2 to MXN 1.01 billion, mainly from insurance products.

• Cash and investments stood at MXN 12.701 billion, up 29.1% year-over-year.

Outlook and guidance

• Confident in meeting full-year guidance for portfolio growth (18–20%) and ROE (over 20%), with double-digit loan portfolio growth expected for 2025.

• Cost of risk expected to stabilize around 12% for 2024 and return to 11.5–12% in 2025.

• ROE in Peru expected to recover to 13–15% by year-end and above 20% in the medium term.

• Management expects to reach a new all-time high in net income by year-end 2024.

• Focus remains on driving synergies, digital tools, and innovative methodologies across subsidiaries.