In 2021, the company’s revenues grew by approximately 60.3% and amounted to approximately NIS 760.1 million, compared with approximately NIS 474.2 million in the corresponding period last year (Corona). The increase in income is due to an increase in the average loan portfolio held by the Company along with an increase in the average interest rate on the loan portfolio and an increase in the index. The Company’s revenues grew in the fourth quarter of 2021 by approximately 28% and amounted to approximately NIS 177.3 million, compared with approximately NIS 138.9 million in the corresponding quarter last year due to an increase in the volume of the credit portfolio.
In 2021, net financing expenses amounted to approximately NIS 89 million, compared with approximately NIS 44.3 million. The increase in financing expenses was due to the increase in the index and an increase in the volume of index-linked credit. The Company’s net financing expenses in the fourth quarter of 2021 amounted to approximately NIS 15.4 million, compared with approximately NIS 13.9 million in the corresponding quarter last year.
In 2021, the net profit jumped by more than 2 and amounted to approximately NIS 181.3 million, compared with approximately NIS 70.9 million in the corresponding period last year (Corona year). The increase in net profit is mainly due to the reasons mentioned above. The increase in net profit was partially offset by an increase in financing expenses due to the increase in the portfolio as well as an increase in marketing and management expenses and in general, when in the corresponding period last year the number of employees was low compared to the reporting period. The net profit in the fourth quarter of 2021 amounted to NIS 34.7 million, compared with NIS 34.4 million in the corresponding quarter last year. Net income was affected by an increase in the volume of revenues offset by the increase in the loan portfolio held to maturity, an increase in general and administrative expenses mainly due to an increase in the number of employees and an increase in marketing expenses.
Credit loss expenses in 2021 were reduced to NIS 53.9 million, compared with NIS 75.1 million in 2020. The decrease in expenses is due to a change in the product mix, technological improvements in collection and service activities and a general improvement in the morale of payments in the economy. In the fourth quarter, credit loss expenses amounted to NIS 10.6 million, compared with NIS 7.8 million in the corresponding quarter last year.
In 2021, the weighted credit damage amounted to 1.52%, compared with 2.2% in 2020. The weighted credit damage in the fourth quarter amounted to 1.11%, compared with 0.88% in the corresponding quarter last year.
As of December 31, 2021, the balance of the loan portfolio provided and marketed by the Company amounted to NIS 9.1 billion (including a loan portfolio that has been approved and / or marketed for third parties), compared with NIS 8.2 billion as of December 31, 2020. In the fourth quarter of In 2021, a check transaction in the amount of NIS 582 million was carried out, while after the date of the report, two additional check transactions were made in the amount of NIS 458 million. There is a decrease in the rate of check transactions from the loans made by the company due to the high leverage ratio of the company which allow it to keep a loan portfolio higher on the balance sheet and consequently improve the long term profitability.
The direct portfolio of direct financing that was not transferred to third parties as of December 31, 2021 amounted to approximately NIS 3.9 billion, compared with approximately NIS 3.5 billion as of September 30, 2021 and approximately NIS 2.7 billion as of December 31, 2020.
The Company’s shareholders’ equity as of December 31, 2121 amounted to approximately NIS 956 million, compared with approximately NIS 679.1 million as of December 31, 2020. The increase is due to the profit in 2021 in the amount of approximately NIS 181 million, from an additional share issue To the public in the amount of approximately NIS 149 million, from the exercise of options in the amount of approximately NIS 9 million and the granting of options to the Company’s employees in the amount of approximately NIS 9 million. Equity partially offsets a dividend dispute in the amount of approximately NIS 72 million. The company’s high financial strength allows the company to significantly increase its credit portfolio based on existing capital.
In accordance with the dividend distribution policy, the Company reports a dividend distribution of approximately NIS 32.5 million, which will be paid in April, 2022.
In November, the company announced that it would start operating in the field of residential-backed loans (mortgages) in accordance with the company’s strategic plan for the coming years.
Eran Wolf, CEO of Direct Finance“We are concluding a record year in the company’s results and a strong quarter. We continued to implement the company’s growth strategy as can be seen in the increase in the volume of loans made, the volume of loan portfolio held by the company and the jump in net profit.” And an improvement in the discount rate of the company’s loan portfolios that have been converted to third parties. “We are working to establish a significant” Market Place “that will include extensive information in the field of vehicles and will be a center of attraction for those looking for a new and used vehicle.