All the (bad) accounts of doValue
DoValue (operator active in impaired loans) closed the first half of the year with net revenues of 191.9 million euros, down by 6.9%. Profit also fell. Facts, numbers and insights
An unlikely challenge with doValue for Alessandro Rivera (in the photo), who after the general direction of the Treasury at the Mef has landed at the helm of the Italian operator active in the management of credit and property portfolios deriving from impaired loans grappling with a controversial evolution and the numbers are plummeting.
Here are the latest news.
DOVALUE'S DIVE ACCOUNTS
DoValue closed the first half of the year with net revenues of 191.9 million euros, down 6.9% compared to the same period last year. Gross revenues stood at 213.7 million (-5.7%).
PROFIT DROPPING FOR DOVALUE
Net profit, including non-recurring items, came to 15.5 million, down 11.2% compared to the first half of 2023. Gross operating margin (ebitda), excluding non-recurring items, decreased by 17.5% to 67.4 million. Operating cash flow stood at 19.6 million euros, with a decrease of 3.8 million compared to the first half of 2023. Net debt fell to 479.4 million, compared to the 517.0 million recorded at the end of March last.
THE DOVALUE OUTLOOK
The company estimates gross revenues in the range of 460-480 million compared to the previous target of 480-490 million. Ebitda is expected between 155-165 million compared to the previous forecast of 160-170 million.
BAG EFFECT
In light of the results, the doValue stock starts with a sharp decline and shows -5.52%.”Such decline could trigger opportunities for the market to sell the stock – we read in a Teleborsa launch – The medium-term technical status of doValue remains negative. In the short term, however, we highlight an improvement in the bullish strength, with the curve meeting the first resistance area at 1.79 Euro, while the supports are estimated at 1.695. The technical implications favor a new bullish trend with a target probably estimated in the 1.885″ area.
THE ACQUISITION OF GARDANT
In recent weeks doValue purchased the Italian non-performing loan manager Gardant in a cash and shares deal. From the merger – wrote Milano Finanza – a leading group will be born in Italy and Southern Europe in debt collection for third parties, with over 160 billion euros under management, approximately 20% of the Italian market, revenues in excess of 600 million and an ebitda over the 200 million. Following the previous announcement on March 21, doValue today, June 7, announced that it has entered into a binding agreement with Tiber Investments, a company affiliated with funds managed by the US-based Elliott, and other minority shareholders, for the acquisition of 100% of the entire share capital of Gardant”
THE SUN SHINES ON DOVALUE
Equally emphatic tones in the Sole 24 Ore in recent weeks: “The merger will create the main player in Italy and Southern Europe in debt collection for third parties, with over 160 billion euros under management, approximately 20% of the Italian market, revenues expected to exceed 600 million and an Ebitda above 200 million. The top structure, in fact, is already defined. Chaired by former Treasury director Alessandro Rivera, the group will be led at European level by Manuela Franchi while Briozzo will continue to follow the Italian activities. The new reality «has the objective, as announced, of positioning itself along the entire credit chain, from the first signs of difficulty onwards, up to the performing activity», says Briozzo. And Gardant will contribute its own asset management company to the new group, which will become an important growth lever abroad. To date, Gardant Investor has raised around 715 million euros, a figure which, however, is destined to grow in the future. The objective, as reiterated by CEO Franchi during the presentation of the operation, is to expand Gardant sgr's activity abroad as well. We look in particular at the countries where DoValue is already active, namely Spain, Greece and Cyprus. «My experience with Gardant is that the management of credit funds also active in direct lending is an important element to complete the product offering – underlines Briozzo – Already today our asset management company is active in the direct lending sector on single name. Looking ahead, I see a pan-European opportunity, where in my opinion no more than two or three complete operators will emerge."
DOVALUE'S 2003 ACCOUNTS (extract from a Startmag article dated 21 March 2024):
In 2023 doValue recorded a net loss of 17.8 million euros, compared to a profit of 16.5 million in 2022. The decline is mainly due to the decrease in Ebitda level, the increase in depreciation, amortization and depreciation and net provisions compared to 2022, mainly related to the write-down of Spanish contracts, as well as lower asset fair value results and higher taxes.
In particular, on the 2023 accounts the overall negative non-monetary impact of the accounting adjustments on the Group's net result amounts to 39.2 million euros. Adjusted net profit (excluding non-recurring items) amounted to 1.8 million, down from 50.6 million in 2022. Ebitda stood at 175.3 million euros, recording a drop of 11%. .8% compared to 2022, when it was equal to 198.7 million. Net revenues, equal to 443.2 million euros, decreased by 11.4% compared to 500.4 million in 2022. Gross revenues were 485.7 million, with a decrease of 13% compared to 558 .2 million recorded in 2022 (or a 4.6% decline excluding Sareb).
As of December 31, 2023, doValue's gross book value stood at 116.4 billion euros, with a modest decline of 3.4% compared to the 120.5 billion recorded at the end of 2022. This figure is attributable to 9, 7 billion Gbv of new acquisitions, 4.9 billion of collections, 4.5 billion of write-downs and 4.4 billion of customer disposals, largely offset by compensation commissions. During 2023, the group was awarded approximately 6.3 billion new mandates: 1 billion in Italy, 4.5 billion in the Hellenic Region and 0.8 billion in the Iberian Region. In relation to the 2023 accounts, the board of directors will not propose the distribution of a dividend at the 2024 shareholders' meeting.
For 2024, the forecasts are for a pipeline of short and medium-term servicing mandates in the doValue markets amounting to 40 billion euros, the actual completion of new primary operations potentially slowed down by the solidity of the banks' balance sheets and the stability of NPL reports. Furthermore, "2024 will be a year of transformation, cost rationalization and investments and will lay the foundations to support growth in 2025 and 2026".
This is a machine translation from Italian language of a post published on Start Magazine at the URL https://www.startmag.it/economia/tutti-i-conti-pessimi-di-dovalue/ on Thu, 08 Aug 2024 09:00:39 +0000.