Despite the challenging economic environment, Letshego achieved double digit growth for the period, with profit before tax up 23% year on year to P544 million.
Profit after tax rose 28% for the same comparative period. Asset quality remains robust with the Group’s Loan Loss Ratio (LLR) within target range at 1.4%, and the non-performing loans ratio reducing to 5.6% (H1 2020: 7.9%).
Strong performance for the interim period was driven by a 20% growth in net customer advances, totalling P11.1 billion.
Product performance saw double digit portfolio growth in Letshego’s primary deduction at source (DAS) portfolio of 16%.
DAS customer numbers increased by 19% to 694k (H1 2020: 586k). The Micro and Small Entrepreneur (MSE) segment remained more sensitive to economic slowdowns with net loan book values dropping 3%.
However, MSE profitability improved with recovery and collection
efficiencies.
Letshego’s Mass Mobile portfolio performed well with a portfolio value increase over 200% year on year.
Net Interest Income increased by 9% to P1.019 billion (H1 2020*: P910million), buoyed by strong net payout growth.
Borrowing costs decreased by 7% year on year (excluding non-risk interest component on mobile loans), following
concerted efforts by the Group to diversify its funding base and grow its customer deposit base.
Operating income was up 14%, despite the new Delta variant of COVID-19.
Letshego remains well capitalised at 34% capital adequacy ratio, and has a strong liquidity position to support business growth.
The Group is pleased to announce an interim dividend of 7.3 thebe, with a dividend yield of 17%.
