KRUK Spólka Akcyjna (KRU) Q2 2025 earnings summary

Executive summary

• Net profit for H1 2025 was PLN 584.2 million, down 3% year-over-year, with revenue rising 8% to PLN 1,600 million and cash EBITDA up 9% to PLN 1,300 million, driven by growth in Italy, Spain, and Poland.

• All markets were profitable in Q2, with a strong positive trend and robust cash position.

• Investments in debt portfolios decreased 10% year-over-year to PLN 805.5 million, while recoveries from purchased portfolios increased 10% to PLN 1,910.3 million.

• Return on equity stood at 22%, and the carrying amount of the debt portfolio reached PLN 10.8 billion, up 18% year-over-year.

Financial highlights

• Leverage at 2.5x, well below the internal limit of 3.0; net debt/cash EBITDA: 2.5x; net debt/equity: 1.3x.

• Revenue: PLN 1,600 million (+8% y/y); operating and administrative expenses: PLN 764 million (+13% y/y).

• Cash EBITDA: PLN 1,300 million (+9% y/y); finance costs: PLN 219 million (+18% y/y).

• Asset base grew 18% year-over-year, nearing PLN 11 billion.

• Release of PLN 37 million deferred tax provision in Q2; effective tax rate expected in mid-single digits for 2025.

Outlook and guidance

• On track to deploy about PLN 2.5 billion in portfolio purchases for the full year.

• Management expects continued sustainable growth, regular dividend payouts, and a net debt-to-cash EBITDA ratio at or below 3.0.

• Less conservative recovery projections for the next 6 months due to recurring positive deviations between actual and projected recoveries.

• Digital transformation program underway, with major gains expected post-2029.

• Effective tax rate of 15% or higher anticipated from 2027 due to Pillar 2 global taxation.