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2017-02-09

Hoist Finance: Year-end report 2016

October - December 2016

· Gross cash collections on acquired loan portfolios increased 7
per cent to SEK 1,105m (1,032).

· Total revenue increased 8 per cent to SEK 672m (621). ?
· Reported EBIT was SEK 242m (211) and the EBIT margin was 36 per
cent (34).

· Profit before tax totalled SEK 155m (132).
· Portfolio acquisitions totalled SEK 1,568m (1,451).
· Basic earnings per share were SEK 1.41 (1.32). Diluted earnings
per share were SEK 1.38 SEK (1.29).

Figures in parentheses refer to Q4 2015.

31 December 2016

· Carrying value on acquired loan portfolios totalled SEK 12,658m
(11,279).

· Gross 120-month ERC (Estimated Remaining Collections) totalled
SEK 21,375m (19,367).

· Total capital ratio improved to 16.76 per cent (15.21).
· CET1 capital ratio was 12.46 per cent (12.32).
· Proposed dividend per share of SEK 1.30 (0.75).
Figures in parentheses refer to 31 December 2015.

Events during the quarter

· Hoist Finance issued EUR 30m of Additional Tier 1 capital to
further optimise its capital structure.

· Launch of the HoistSpar app, making it easier and more convenient
for customers to monitor their savings.

· Larger forward flow agreements entered. The agreements cover a
range of predetermined volumes in 2017.

Statement by the CEO

Strong fourth quarter marking the end of a successful year

We have now closed 2016 and Hoist Finance can look back on another
successful and profitable year, during which we have continued to
strive towards our vision - a leading debt restructuring partner to
international banks and financial institutions.

During the year we continued to operate in line with our strategy,
gradually strengthening our market presence. Several key milestones
on our growth journey were achieved during the year, amongst others
our entry into the Spanish market, our strategic partnership with the
Bank of Greece, and the establishment of our EMTN programme to
diversify and broaden our funding base.

Operating profit (EBIT) increased 39 per cent and profit before tax
increased 87 per cent compared to full year 2015.

Major portfolio acquisitions and strong earnings during Q4

The fourth quarter showed strong development. Year-on-year, operating
profit (EBIT) increased 14 per cent and profit before tax increased
18 per cent. Portfolio acquisitions totalled SEK 1,568 million during
Q4, seasonally the strongest quarter for investments. We acquired
portfolios for a total value of SEK 3,329 million during the year, in
line with investments made during the three preceding years. We
continue to consistently invest in accordance with our profitability
requirements, with acquisitions at long-term sustainable levels in
terms of both profitability and risk. This also enables the
generation of stable, predictable and profitable growth for our
shareholders going forward.

Strengthened positions on a regional level

In Region West Europe, an increased focus on the integration of the
2015 Compello acquisition produced results. The region's EBIT, EBIT
margin and return on book improved steadily during the year. The
establishment of operations in Spain during the second quarter is
already starting to have a positive impact on earnings.

Region Mid ended the year with major portfolio acquisitions, which
included a strengthening of our position in small- and medium-sized
enterprise (SME) loans through the acquisition of an SME portfolio
from Banco Popolare in Italy. A portfolio was also acquired in Italy
from one of Europe's largest consumer banks, the third transaction in
which the seller chose Hoist Finance as partner. These acquisitions
strengthen our position and broaden our expertise and capacity beyond
the consumer segment.

In Region Central East, focus during the year was on optimising
operations. Several improvement initiatives have resulted in a
maintained operating margin as compared with the same period last
year, despite lower acquisition activity. A service contract was also
terminated during the autumn, with resources reallocated to our core
business.

Outlook for 2017

Looking to next year, we see a continuation of favourable market
conditions. Growth is driven by the movement of several markets
towards greater market maturity, with NPL sales becoming an
increasingly integrated part of the financial ecosystem.

Continued regulatory pressure and profitability problems for banks are
also strong drivers for market growth. By selling NPLs, banks can
lower their costs, clear their balance sheets and, not least, focus
on their core business.

Our partners are to an increasing extent looking for well-known,
highly respected purchasers who meet all regulatory requirements and
who have a documentd track record of treating customers fairly and
respectfully. With our status as a regulated financial institution,
our high ethical standards for customer relations, our strong
financial position and our geographic presence, we are well
positioned for future growth opportunities.

We will continue our efforts to strengthen our position as a leading
partner to international banks and financial institutions in Europe.
This includes actively evaluating opportunities to enter new
geographic markets and, in a disciplined way, continuing to increase
our presence in other asset classes such as secured loans and SME
loans.

In late 2016 a forward flow agreement was signed for portfolio
acquisitions in 2017 valued at SEK 800 million. Along with the strong
start to 2017 and the healthy market growth we see ahead of us, this
reinforces our ambition to reach our targets.

Jörgen Olsson

CEO

Hoist Finance AB (publ)

Hoist Finance AB (publ) (the "Company" or the "Parent") is the parent
company of the Hoist Finance group of companies ("Hoist Finance").
The Company's wholly owned subsidiary, Hoist Kredit AB (publ) ("Hoist
Kredit") is a regulated credit market company. Hence, Hoist Finance
produces financial statements in accordance with the Swedish Annual
Accounts Act for Credit Institutions and Securities Companies. In
order to assess the operational performance of the debt purchasing
and collection operations and to facilitate comparison with our
competitors, Hoist Finance supplements its statutory financial
statements with an operating income statement. The operating income
statement is prepared based on the accounting and valuation
principles used in the statutory financial statements, with no
amendments or adjustments thereto.

The information in this interim report is such that Hoist Finance is
obligated to publish under the EU Market Abuse Regulation and the
Swedish Securities Market Act. This information was submitted for
publication on 9 February 2017 at 8:00 AM CET.

Michel Jonson

Group Head of Investor Relations

Tel: 46 8 555 177 19

About Hoist Finance

Hoist Finance is a leading debt restructuring partner to international
banks and financial institutions, offering a broad spectrum of
advanced solutions for acquisition and management of non-performing
unsecured consumer loans. Hoist Finance operates through eleven
in-house collection centers across Europe, complemented by local
external debt servicing partners. The total carrying value of Hoist
Finance's acquired loans was approximately SEK 11.3 billion as per 31
December 2015. The parent company Hoist Finance AB (publ) is listed
on Nasdaq Stockholm Mid-Cap list and its subsidiary Hoist Kredit AB
(publ) is a regulated "Credit Market Company" under the supervision
of the Swedish Financial Supervisory Authority (Sw.
Finansinspektionen). In Sweden, the company offers internet-based
savings deposit services through HoistSpar, with around 85,000
accounts.

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http://news.cision.com/hoist-finance/r/year-end-report-2016,c2183710
http://mb.cision.com/Main/8270/2183710/625758.pdf

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