KTC declares 4.205 billion in first nine months net profits. Receivables growth hit an all-time high in the past two years with plans to expand member base and fortify quality of ports.

Stocks and Financial Services Press Releases Friday October 18, 2019 17:54
Bangkok--18 Oct--Krungthai Card

KTC announces net profits for the first nine months with a 8 percent growth at 4.205 billion. Budget will be allocated to stimulate marketing activities and expand member base. Policy to expand member base and in main business caused portfolio to have grown at an all-time high in the past two years. Credit card spending spiked to 10.4 percent while NPL for both credit card and personal loan businesses dropped even more to 1.07 percent. For the final part of the year, the firm is moving forward by expanding customer base and fortifying portfolio to achieve target indices.

Mr. Rathian Srimongkol, President & Chief Executive Officer, "KTC" or Krungthai Card Public Company Limited, states, "KTC has adjusted its strategies to generate more revenue from growth in new accounts and portfolio in the past nine months. Not only did our overall ports grew at an all-time high in the past two years since Q3 of 2018, but it also contributed positively to overall credit card spendings which grew staggeringly in the past nine months, while its receivables continued to have high quality. For Q3, the firm has a profit of 1.292 billion, a 7 percent decrease, as the firm has increases in reserve expenses to correspond to port growth, card approval expenses, and marketing promotion campaigns to stimulate cardmembers to make transactions using KTC cards. As a result, the overall expenses for Q3 experienced a 10 percent growth while total revenue grew 4 percent."

As of September 30, 2019, KTC has a net profit of 4.205 billion and a total asset value of Bt. 79.618 billion (9 percent increase). Total member base numbered 3.43 million (6 percent increase), comprising of 2,460,595 credit cards (7 percent surge). Total credit card receivable 51.137 billion (10 percent growth). KTC credit card spending growth in the past nine months totaled 10.4 percent. Net NPL (non-performing loan) continues to remain low at 1.07 percent. NPL for credit cards is 0.96 percent. Personal loans numbered 973,356 accounts (5 percent growth). Personal loans receivable amounted to 28.219 billion (9 percent growth) and NPL for the personal loans business totaled 0.83 percent.

In the past nine months, KTC has revenue of Bt. 16.699 billion, a 6 percent increase compared to the same period last year from interest (including credit usage fees) which grew 7 percent, fees which grew 4 percent, and bad debt receivables which grew 2 percent. Meanwhile, the firm has a cost to income ratio of 34 percent, a decrease from 34.8 percent in the same period last year. The firm had selling and administration expenses of Bt. 5.685 billion, a 4 percent increase compared to the same period last year due to an increase in new member acquisition, which caused credit card receivables to expand at an all-time high. Moreover, the firm had organized a significant amount of marketing promotion campaigns which caused an increase of 14 percent in marketing expenses. Along with this, personnel expenses and operating expenses increased 5 percent and 4 percent, respectively. Meanwhile, fees were in similarly valued. Despite this, KTC continues to maintain its financial expenses at the same level.

Mr. Rathian adds, "Regarding "Pico Finance", "Nano Finance", and "Auto Title Deed Loan", KTC has gained licenses for all three business practices in August and September of 201, currently under system and process development. It is expected to see reflected income from these three new businesses within 18-24 months from actual business operation date."

"For the final quarter of the year, KTC has allocated its budget to constantly expand its customer base, including both credit cards and personal loans. Additionally, the firm has increased its marketing expenses to stimulate consumer spending with aims for the receivables to grow with quality which may have an effect on net profits. However, the firm will continue to monitor and be prepared and appropriate business strategy for the changing economic condition. Along with this, the firm will continue to operate every element of its business to comply to set policies and targets, and the company has determined to achieve its 2019 performance approximately as previously planned."

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