Arrow Global (ARW) continues to look to the less mature debt purchase markets in Europe for growth. After acquiring the debt servicing operations of Dutch bank RNHB Hypotheekbank, the group co-invested in real estate loans with a face value of around €1.7bn (£1.5bn). The distressed debt buyer is also moving into Italy - which has the highest volume of non-performing loans in Europe. The group is awaiting approval from the Bank of Italy to purchase debt servicing business Zenith, which it expects to receive during the first half of the year.
Organic loan purchases were £223m, up around a quarter on 2015. Together with assets gathered as part of its acquisition of Dutch-Belgian debt servicer Vesting, that took the face value of loans bought last year to £2.2bn. Acquiring loans in excess of the required replacement rate meant the 84-month estimated remaining collections - an important pipeline measure - increased by 30 per cent. Core loan collections last year were up by the same amount at £286m thanks to gradual growth of the portfolio. Portugal was the biggest contributor to building the loan portfolio as the country's banks continued to deleverage.
Analysts at Shore Capital expect adjusted net assets of 121p at the end of December 2017.
ARROW GLOBAL (ARW) | ||||
|---|---|---|---|---|
| ORD PRICE: | 313.3p | MARKET VALUE: | £546m | |
| TOUCH: | 313-313.5p | 12-MONTH HIGH: | 338p | LOW: 171p |
| DIVIDEND YIELD: | 2.9% | PE RATIO: | 21 | |
| NET ASSET VALUE: | 96p* | NET DEBT: | £816m | |
| Year to 31 Dec | Turnover (£m) | Pre-tax profit (£m) | Earning per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2012 | 66 | 12.1 | 7 | nil |
| 2013 | 93 | 21.0 | 10 | nil |
| 2014 | 111 | 24.1 | 10 | 5.1 |
| 2015 | 165 | 39.3 | 18 | 7.1 |
| 2016 | 236 | 31.4 | 15 | 9.1 |
| % change | +43 | -20 | -17 | +28 |
Ex-div: 8 Jun Payment: 6 Jul *Includes intangible assets of £167m, or 96p a share | ||||
