Increase in issuances continue to drive strong profitability in terms of EBITDA growth

OPERATIONAL AND STRATEGIC HIGHLIGHTS

• Group loans issued increased strongly by 55.6% equalling EUR 178.4 million (2018:  EUR 114.6 million), of which EUR 53.7 million in mid-tier markets (2018: EUR 33.1 million)
• In line with the announced commitment, Mogo Finance shareholders have injected additional EUR 3 million of capital during Q4 2019. This marks total new capital of EUR 5 million injected into the Group during 2019 with further EUR 5 million to follow by the end of Q1 2020
• Mogo Finance has divested its used car retail business by selling Longo brand entities resulting in a gain of EUR 1.0 million for the Group. This sale will allow to fully focus Group’s operations on the lending business in order to significantly increase the overall profitability. Longo will continue to remain a strategic used car sales partner for Mogo
• By following its profitable growth strategy, the Group has managed to deliver annual profitability of now 8 markets (2018: 6 markets) measured by net profit and 10 markets (2018: 6 markets) measured by EBITDA
• As of the end of 2019 full regional HUB teams as well as group management team have all been set up, no significant further pressure on costs expected                                                                                                                                                          

FINANCIAL HIGHLIGHTS AND PROGRESS                              

• Interest and similar income including income from used car rent up strongly by 40.5% to EUR 76.7 million (2018: EUR 54.6 million)
• Significant growth in total equity by 61.8% to EUR 28.8 million (31.12.2018: EUR 17.8 million)
• Rapid increase in EBITDA by 54.4% to EUR 31.5 million (2018: EUR 20.4 million)
• Net profit for the period improved notably by 34.8% to EUR 6.2 million (2018: EUR 4.6 million)

Modestas Sudnius, CEO of Mogo Finance, commented:

“During 2019 we have executed well on our strategy for the year – to focus on the profitability – and have delivered a record annual EBITDA with a more than 50% increase compared to the year 2018.

This was mainly driven by significant profitability and operational performance improvements particularly in mid-tier markets as well as solid results in our mature countries.

Longo business line sale, together with now fully staffed regional and group management teams, will help us to fully focus on our core mission – providing mobility by the use of most convenient financing solutions.

Mogo Group is well positioned to have another record-breaking year ahead of us with core focus on continuous top line and profitable growth .”

The full unaudited report for the twelve months ended 31 December 2019 is available under https://current.mogo.finance/investment/results-and-reports/.

Conference Call:

A conference call in English with the Group’s management team to discuss these results is scheduled for 18 February 2020, at 15:00 CET. 

Please register: http://emea.directeventreg.com/registration/8799929

The presentation for the conference call will be available here as of 18 February 2020, at 09:00 CET. 

About Mogo Finance:

Mogo Finance is one of the largest and fastest-growing secured used car financing companies in Europe.  Recognizing the niche in used car financing underserved by traditional lenders, Mogo Finance has expanded its operations to 17 countries issuing over EUR 550 million up to date and running a net loan and used car rent portfolio over EUR 190 million. Mogo offers secured loans up to EUR 15,000 with maximum tenor of 84 months making used car financing process convenient, both for its customers and partners. Wide geographical presence makes Mogo unique over its rivals and diversifies revenue streams.

Mogo Finance operates through its own branch network, more than 2,000 partner locations and strong online presence. Physical footprint makes Mogo Finance top of mind brand in used car financing. Established in 2012, headquartered in Riga, Latvia Mogo Finance operates in:  Latvia, Estonia, Lithuania, Georgia, Poland, Romania, Bulgaria, Moldova, Albania, Belarus, Armenia, Uzbekistan, Kazakhstan, North Macedonia, Bosnia and Herzegovina, Kenya and Uganda.

IMPORTANT INFORMATION

The information contained herein is not for release, publication or distribution, in whole or in part, directly or indirectly, in or into the United States, Australia, Canada, Hong Kong, Japan, New Zealand, South Africa or any other countries or otherwise in such circumstances in which the release, publication or distribution would be unlawful. The information contained herein does not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of, the bonds in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration, exemption from registration or qualification under the securities laws of any such jurisdiction. Persons into whose possession this announcement may come are required to inform themselves of and observe all such restrictions

This announcement does not constitute an offer of securities for sale in the United States. The bonds have not been and will not be registered under the Securities Act or under the applicable securities laws of any state of the United States and may not be offered or sold, directly or indirectly, within the United States or to, or for the account or benefit of, U.S. persons except pursuant to an applicable exemption from, or in a transaction not subject to, the registration requirements of the Securities Act.

This announcement does not constitute a prospectus for the purposes of Directive 2003/71/EC, as amended (the “Prospectus Directive”) and does not constitute a public offer of securities in any member state of the European Economic Area (the “EEA”).

This announcement does not constitute an offer of bonds to the public in the United Kingdom. No prospectus has been or will be approved in the United Kingdom in respect of the bonds. Accordingly, this announcement is not being distributed to, and must not be passed on to, the general public in the United Kingdom. The communication of this announcement as a financial promotion may only be distributed to and is only directed at (i) persons who are outside the United Kingdom or (ii) investment professionals falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the “Order”) or (iii) high net worth companies, and other persons to whom it may lawfully be communicated, falling within Article 49(2)(a) to (d) of the Order (all such persons in (i), (ii) and (iii) above together being referred to as “Relevant Persons”). Any invitation, offer or agreement to subscribe, purchase or otherwise acquire such securities will be engaged in only with, Relevant Persons. Any person who is not a Relevant Person should not act or rely on this announcement or any of its contents.

PROFESSIONAL INVESTORS ONLY – Manufacturer target market (MIFID II product governance) is eligible counterparties and professional clients only (all distribution channels). No PRIIPs key information document (KID) has been prepared as the bonds do not constitute packaged products and will be offered to eligible counterparties and professional clients only.