Credit Corp Group Limited (CCP)
Views and News
A Tried and Tested Debt Ledger Collector Growing Steadily
CCP is a leading specialist collector of debts in Australia, experienced in working out debts and advances found difficult by major banks, financial institutions and corporations. It purchases ledgers of such debts at agreed substantial discounts that reflect their problem nature.
After a major and in retrospect excessive price run-up into 2007, its own high debt exposure and some weakness in staff abilities partly related to its rapid growth, the GFC hit hard. Following a period of quiet but decisive restructuring, with management changes and a focus on training and conservative financing, CCP is again, more cautiously we believe and trust, demonstrating the prospects for a seasoned and strong operator in this field.
Recent News Highlights
As at 31/12/2012 : see details at www.creditcorp.com.au (new window? Shift+Click)
| 21/12/2012 One-off Item and Revised Purchasing Guidance |
| 03/12/2012 Response to ASX Price Query |
| 08/11/2012 AGM, Chairman's Address and CEO's Presentation |
| 04/10/2012 2012 Annual Report to Shareholders |
| 07/08/2012 FY12 Full Year Results & Presentation |
| 16/05/2012 Upgrades FY12 Guidance on strong 10-month figures; Debt low; Well positioned for FY13 |
| 13/04/2012 Final Settlement of Shareholder Class Action |
| 02/02/2012 1H12 result: positive result and outlook |
| 19/12/2011 Conditional Settlement of Shareholder Class Action |
| 19/12/2011 AGM Address and Presentation |
May guidance for FY12 (February guidance in brackets): Purchase Debt Ledger acquisitions up at $84-88m ($75-85m); NPAT at $26-27m ($25-27m); Basic EPS 57-59 cents (55-59¢).
Free cash flow, ten months to April: $31.7m (pcp $18.1m); Net bank debt, April $1.9m (pcp $29.5m). Purchases and collections meeting expectations, CCP also driving collections from earlier PDLs while maintaining efficiency. Strong payers base suggests this will continue. CCP continues to increase collection capacity / headcount.
The strong FY12 purchasing will underpin solid profits in FY13. CCP continues to maintain purchasing discipline. Two consumer lending products launched in 1H12 showing positive early results; further products scheduled for launch in coming months.
The recent initiative of a US debt purchasing operation is on track. This involves purchasing in partnership with a local private buyer / collector, with an outlay to date of $1.8m. Early collections are in line with expectations; a CCP operations manager has been relocated to the US to work with its partners, while direct collections by CCP staff are scheduled for 1Q13.
We see CCP as now soundly managed and well on track.
Half-yearly Performance & Estimates - CCP
| Year-end June | FY11A | 1H12A | FY12A | 1H13A | FY13A | FY14E | FY15E |
|---|---|---|---|---|---|---|---|
| Sales, $m | 0.00 | 0.00 | 1.7 | 66.3 | 135.9 | 157.0 | 170.0 |
| EBITDA, $m | 0.00 | 0.00 | -81.5 | 26.8 | 47.5 | 49.3 | 50.8 |
| EBIT, $m | 0.00 | 0.00 | -83.2 | 26.4 | 46.3 | 48.4 | 49.5 |
| Report NPAT, $m | 21.1 | 13.1 | 26.6 | 18.9 | 32.0 | ||
| Adj. NPAT, $m | 32.0 | 33.1 | 36.0 | ||||
| Reported EPS, ¢ | 47.00 | 29.00 | 58.00 | 41.00 | 70.00 | ||
| Adjusted EPS, ¢ | 70.00 | 72.10 | 78.00 | ||||
| EPS %FY/Growth | 50% | 23% | 59% | 21% | 3% | 8% | |
| Dividend, ¢ | 20.0 | 13.0 | 29.0 | 20.0 | 37.0 | 36.00 | 39.00 |
| Franking, % | 100% | 100% | 100% | 100% | 100% | 100% | 100% |
| EBITDA Margin | 0 | 0 | 0 | 40% | 35% | 31.4% | 29.9% |
| NPAT Margin | 0 | 0 | 0 | 28% | 24% | 21.1% | 21.2% |
| ROE, % | 20% | 0 | 22% | 14 | 23% | ||
| EBIT/Interest | 0.7 | 0.0 | 0.7 | 73.06 | 83.99 | ||
| Net Debt / Equity | 0.23 | 0 | -0.02 | 0.03 | 0.04 | ||
| CashFlow/Sh, ¢ | 266.4 | 34.9 | 85.3 | 2.8 | 22.9 | 259.8 | 330.7 |
| Y/E Shares, m | 45.3 | 45.6 | 45.6 | 46.0 | 46.0 |
| Notes |
| Data sourced from IRESS Market Technology Limited. EPS Growth compared with the pcp is shown in most columns, except 1H11A and 1H12A which show the first half % of full year EPS. In a handful of cases, unadjusted share splits may give strange changes in ratios. |
Half-year Performance & Estimates - CCP
| Year-end June | 1H11A | FY11A | 1H12A | FY12A | 1H13A | FY13E | FY14E |
|---|---|---|---|---|---|---|---|
| Sales, $m | 3,877 | 0.00 | 0.00 | 1.7 | 66.3 | 136.0 | 156.0 |
| EBITDA, $m | 0.00 | 0.00 | 0.00 | -81.5 | 26.8 | 45.1 | 48.4 |
| EBIT, $m | 10.6 | 0.00 | 0.00 | -83.2 | 26.4 | 42.0 | 49.1 |
| Report NPAT, $m | 10.6 | 21.1 | 13.1 | 26.6 | 18.9 | ||
| Adj. NPAT, $m | 13.1 | 29.0 | 32.9 | ||||
| Reported EPS, ¢ | 24.00 | 47.00 | 29.00 | 58.00 | 41.00 | ||
| Adjusted EPS, ¢ | 28.70 | 63.00 | 71.70 | ||||
| EPS %FY/Growth | 51% | 50% | 23% | -1% | 9% | 14% | |
| Dividend, ¢ | 10.0 | 20.0 | 13.0 | 29.0 | 20.0 | 36.00 | 36.00 |
| Franking, % | 100% | 100% | 100% | 100% | 100% | 100% | 100% |
| EBITDA Margin | 21% | 0 | 0 | 0 | 40% | 33.2% | 31.0% |
| NPAT Margin | 9% | 0 | 0 | 0 | 28% | 21.3% | 21.1% |
| ROE, % | 25% | 20% | 0 | 22% | 14% | ||
| EBIT/Interest | 4.5 | 0.7 | 0.0 | 0.7 | 73.06 | ||
| Net Debt / Equity | 1.03 | 0.23 | 0 | -0.02 | 0.03 | ||
| CashFlow/Sh, ¢ | 127.3 | 266.4 | 34.9 | 85.3 | 2.8 | 292.8 | 340.7 |
| Y/E Shares, m | 44.9 | 45.3 | 45.6 | 45.6 | 46.0 |
| Notes |
| EPS Growth compared with the pcp is shown in most columns, except 1H10A and 1H11A which show the first half % of full year EPS. |
Half-yearly Performance & Estimates - CCP
| Year-end June | FY10A | 1H11A | FY11A | 1H12A | FY12A | FY13E | FY14E |
|---|---|---|---|---|---|---|---|
| Sales, $m | 0.00 | 3,877 | 0.00 | 0.00 | 1.7 | 136.0 | 139.0 |
| EBITDA, $m | 0.00 | 0.00 | 0.00 | 0.00 | -81.5 | 42.8 | 45.5 |
| EBIT, $m | 0.00 | 10.6 | 0.00 | 0.00 | -83.2 | 41.3 | 44.8 |
| Report NPAT, $m | 13.6 | 10.6 | 21.1 | 13.1 | 26.6 | ||
| Adj. NPAT, $m | 26.6 | 29.3 | 31.6 | ||||
| Reported EPS, ¢ | 30.00 | 24.00 | 47.00 | 29.00 | 58.00 | ||
| Adjusted EPS, ¢ | 58.00 | 63.10 | 67.50 | ||||
| EPS %FY/Growth | 51% | 57% | 50% | 23% | 9% | 7% | |
| Dividend, ¢ | 8.0 | 10.0 | 20.0 | 13.0 | 29.0 | 31.00 | 34.00 |
| Franking, % | 100% | 100% | 100% | 100% | 100% | 100% | 100% |
| EBITDA Margin | 0 | 21% | 0 | ******% | -4794% | 31.5% | 32.7% |
| NPAT Margin | 0 | 9% | 0 | ******% | 1564.7% | 21.5% | 22.7% |
| ROE, % | 15% | 25% | 20% | 22% | |||
| EBIT/Interest | 0.8 | 4.5 | 0.7 | ****** | 0.69 | ||
| Net Debt / Equity | 0.48 | 1.03 | 0.23 | 0 | -0.02 | ||
| CashFlow/Sh, ¢ | 232.4 | 127.3 | 266.4 | 34.9 | 85.3 | 221.6 | 210.0 |
| Y/E Shares, m | 44.6 | 44.9 | 45.3 | 45.6 | 45.6 |
| Notes |
| Data sourced from IRESS Market Technology Limited. EPS Growth compared with the pcp is shown in most columns, except 1H11A and 1H12A which show the first half % of full year EPS. In a handful of cases, unadjusted share splits may give strange changes in ratios. |
Company Overview
See above and on the Credit Corp Group website.
Russell Research in the media
Stock Picks for The Bull.com.au - 24 June 2013
HOLD Credit Corp Group Limited (CCP)
CCP acquires debt ledgers from credit providers. Learning from severe GFC burnout after over-played expansion, it has been rebuilt in a controlled manner. Yet profit growth has still been rapid, with a 20% return on equity and no net debt. An organically grown consumer loan book and a timely staged build-up of debt ledger operations in the US add opportunities to retain double digit growth.
Stock Picks for Sunday Herald Sun – 4 November 2012
HOLD Credit Corp Group Limited, CCP, $7.20
Buys bank and corporate debtors at a price and works them out. Experienced, with high returns and growth. Franked yield 4.4%.
Stock Picks for Sunday Herald Sun - 12 February 2012
BUY: Credit Corp Group Limited, CCP, $5.27
CCP enjoyed a strong first half and raised its profit guidance. With expansion, there is more to come.
Profile
Credit Corp Group
Rating: ♣
Category: Potent Stock ; Midcaps
Action:
Website: www.creditcorp.com.au
| ASX code: | CCP |
| Closing Price, 30/12/2013: | $ 9.450 |
| Market Capitalisation: | $ 427 million |
| 52 Week High: | $ 10.89 |
| 52 Week Low: | $ 7.92 |
| Sector: | Diversified Support Services |
| Index: | S&P/ASX 300 Index |
Summary of Fundamentals
| Year-end June | FY12A | FY13A | FY14E | FY15E |
|---|---|---|---|---|
| NPAT, $m | 26.6 | 32.0 | 33.2 | 36.7 |
| Reported EPS, ¢ | 58.00 | 70.00 | ||
| Adjusted EPS, ¢ | 65.20 | 72.20 | 80.00 | |
| EPS Growth, % | 23% | 12% | 11% | 11% |
| P/E Ratio, x | 16.29 | 14.49 | 13.09 | 11.81 |
| Dividend, ¢ | 29.0 | 37.0 | 37.00 | 40.00 |
| Franking, % | 100% | 100% | 100% | 100% |
| Div. Yield, % | 3.07 | 3.92 | 3.92 | 4.23 |
Notes
| Our Adjusted EPS is used for the last year and forward estimates and as basis for EPS Growth and P/E Ratio. We currently use Reported data for all historic NPAT, for the prior year EPS and as base for last year EPS growth. |
| Data & Chart sourced from IRESS Market Technology Ltd. |
One Year Chart
As at 30 December 2013
Other Highlights
| Sector: | Diversified Support Services |
| Return on Equity, FY13 : | 23% |
| Net Debt to Equity, FY13 : | 4 % |
| EBIT / Interest Cover, FY13 : | 83.99 x |
| Gicscode: | 20201070 |
| First Listed: | 4-Sep-00 |
Business Activities
Credit Corp Group Limited (CCP) is a receivables manager, specialising in debt purchase and debt collection. It acquires purchased debt ledgers (PDLs) of distressed consumer debt from Australia's financial and commercial groups.
Glossary:
| ♠ | "A Core Stock" - reliable long-term yield & growth |
| ♥ | "We like it" - a seasoned performer, growth & yield |
| ♦ | "A tough scout" - creating a potential breakthrough |
| ♣ | "A steady performer" - giving reliable yield or growth |
| Best Stocks | Portfolio of selected attractive investments |
| Potential | Stocks that may have good improvement prospects |
| Speculative | More risky usually smaller stocks with spec. upside |
| Midcaps | In RR Midcap Index, $ 70m to 1,500m market cap. |
| Large Stocks | Larger Stocks upwards of $ 1,500m market cap |