Kaspi.kz 1Q 2024 Financial Results

Rhea-AI Summary

Kaspi.kz, a leading company in Kazakhstan, reported strong financial results for the first quarter of 2024, with revenue and net income up by 40% and 28% respectively compared to the previous year. The company's Marketplace platform showed significant growth, with revenue from various services contributing to a higher take-rate. The acquisition of Kolesa.kz has positioned Kaspi.kz as a major player in the auto market, with e-Cars becoming a profitable segment. E-Commerce and e-Grocery segments also saw impressive growth, along with Kaspi Travel and Fintech platforms. The company plans to focus on shareholder value through dividends and efficient capital allocation, while maintaining a strong outlook for future growth.

Positive

• Revenue and net income increased by 40% and 28% YoY respectively.
• Marketplace platform showed strong growth with various services enhancing the take-rate.
• Acquisition of Kolesa.kz led to significant opportunities in the auto market.
• E-Commerce, e-Grocery, Kaspi Travel, and Fintech platforms experienced notable growth.
• Focus on shareholder value through proposed dividends and strategic capital allocation.
• Positive outlook for continued growth and expansion initiatives.

Negative

• None.

Insights

Financial Analyst

Key financial indicators from Kaspi.kz's 1Q 2024 report show a robust growth trajectory, characterizing a vigorous start to the year. The reported 40% increase in revenue and 28% rise in net income year-over-year signal a decisive uptick in business operations. Highlighting the payments and marketplace platforms as sizable contributors to net income, with an ascent from 60% to 68%, underscores the strategic significance of these segments in the broader revenue matrix.

The decision to propose a dividend of KZT850/ADS may appeal to income-focused investors, balancing growth with shareholder returns. This delicate equilibrium helps maintain investor confidence, especially when supported by predictions of continued 25% net income growth into the fiscal year. However, investors should be attentive to the impact of the proposed dividend on the company's capital allocation strategy, particularly regarding its ambitions for international expansion.

Market Research Analyst

The growth numbers within Kaspi.kz's e-commerce and fintech sectors are particularly striking. A 125% growth in e-Grocery GMV and the 44% increase in Travel GMV reflect a strong consumer uptake. These figures are a testament to the company’s ability to capitalize on category-specific demand and resonate with consumer trends.

Moreover, the focus on the autos vertical through Kolesa.kz, evidenced by a substantial 26% of e-Commerce GMV emanating from e-Cars, suggests a strategic pivot to dominate a large, addressable market. The integration of new services like Kaspi Tours and the robust performance of Merchant & Micro Finance lending, which now comprises 17% of TFV, showcases innovative diversification strategies potentially enhancing customer retention and opening up new revenue streams.

Tech Industry Analyst

The technological underpinnings that support Kaspi.kz's 'Super App' ecosystem are central to their market dominance, especially in e-Commerce and fintech. The reported 114% increase in e-Commerce GMV and a higher take-rate indicate not just an expansion in volume but also an improved monetization of the platform's offerings.

The emphasis on an integrated GovTech solution for the autos vertical demonstrates an intersection of technology and regulation that may set new industry standards. Furthermore, the positive net income from the newly launched 1P marketplace in Almaty suggests that Kaspi.kz successfully leverages its tech capabilities to penetrate new markets efficiently. For investors, the company's tech-driven approach signals potentially sustainable growth buoyed by continuous innovation.

ALMATY, Kazakhstan, April 22, 2024 (GLOBE NEWSWIRE) -- Joint Stock Company Kaspi.kz (“Kaspi.kz”, “we”, or the “Company”) (Nasdaq: KSPI) which operates the Kaspi.kz Super App for consumers and Kaspi Pay Super App for merchants, today publishes its unaudited consolidated IFRS financial results for the quarter ended 31 March 2024 (“1Q 2024”).

1Q 2024 Highlights

• Strong start to 2024 with first quarter revenue and net income up 40% and 28% year-over-year (“YoY”), respectively.
• Our faster growing and more profitable Payments and Marketplace Platforms together accounted for 68% of consolidated net income, up from 60% in 1Q 2023.
• All Platforms continued to deliver strong top-line growth in the first quarter of 2024. Once again, Marketplace was our fastest growing platform with GMV and revenue up 62% and 108% YoY respectively:
  • Revenue from delivery, advertising and classifieds value added services added 160bps to Marketplace Take-Rate, which reached 9.5%.
  • Marketplace net income in 1Q 2024 up 76% YoY including rapid growth from e-Grocery and e-Cars.
• Within Marketplace, e-Commerce keeps delivering the stand-out performance:
  • e-Commerce GMV up 114% YoY.
  • e-Commerce Take-Rate up 90 bps YoY to 11.1%.
• Following the acquisition of Kolesa.kz, we are focussing on the autos vertical which is we believe one of the largest areas of household spending:
  • With 1.9 million cars registered in 2023, the addressable market is large.
  • Kolesa.kz gives us the go to platform for car sales and is central to our strategy.
  • We are now aiming to create a 1^st class consumer experience around selling, buying & servicing a car.
  • e-Cars accounted for 26% of e-Commerce GMV and included 1P, 3P car and auto part sales in 1Q 2024.
  • 1,200 vehicles sold in our 1P marketplace in Almaty during the first quarter. Already net income profitable.
• e-Grocery top-line keeps growing fast:
  • GMV up 125% & active consumers up 84% YoY to 566k.
• Kaspi Travel still growing rapidly:
  • Travel GMV up 44% YoY. Take-Rate up 40bps to 4.5%.
  • Last year we launched Kaspi Tours, a vacation packages marketplace, and by 1Q 2024 tours already accounted for 7% of Travel’s GMV.
  • Tours are GMV growth enhancing and had an 8.7% Take-Rate in 1Q 2024.
• M-Commerce delivered accelerating growth compared to the final quarter of 2023:
  • M-Commerce GMV up 34% YoY and take-rate up 90bps to 8.9%.
• In Payments, strong top-line continues to drop-through to bottom-line:
  • Revenue and net income both up 25% YoY.
• Fintech Platform TFV growth up 48% YoY:
  • Merchant & Micro Finance is our fastest growing lending product and at 17% of TFV is increasingly meaningful in size.
  • Fast TFV growth, combined with moderating interest rates expected to drive a strong increase in Fintech net income growth in the final part of 2024.
• Investing in our growth is always our top priority. However, if we have excess capital, we will return it to our shareholders.
  • Based on strong 1Q 2024 Kaspi.kz consolidated financials our Board of Directors proposes a dividend of KZT850/ADS, subject to shareholder approval.
• The second quarter of 2024 has gotten off to a strong start and we observe a healthy and predictable consumer and merchant environment. Taking this into account we continue to expect Kaspi.kz to deliver another year of fast earnings growth at scale in Kazakhstan, with 2024 consolidated net income anticipated to be up around 25% YoY.

To the shareholders of Kaspi.kz:

Having completed our US listing on Nasdaq, we’re 100% focussed upon execution.

During the first quarter, top-line growth momentum remained strong across all areas of our business. As was the case last year, e-Commerce keeps going from strength to strength, with GMV up 114% year-over-year. Within this, e-Grocery GMV increased 125% year-over-year. Kaspi.kz is the market leader in e-Commerce and e-Grocery and as we have said previously, we believe these two areas offer amongst the biggest opportunities for us to create value for both our customers and shareholders, over the next couple of years.

When we acquired Kolesa.kz, I promised you that it wouldn’t take long for us to start transforming the car market. With 1.9 million used cars registered in 2023, we believe this is another large opportunity. The value of cars alone listed on Kolesa.kz is around $37 billion.

We’re developing products across multiple areas of autos spending. Integrated GovTech including tools to register a newly purchased car, along with our payments and fintech products give us a strong starting point. Already GMV from e-Cars, which includes the sale of vehicles and their parts is equivalent to 26% of our e-Commerce GMV in 1Q 2024. On our newly launched 1P marketplace, we sold 1,200 cars during the quarter and by leveraging our technology and data we’re net income profitable. As we ensure the Kaspi.kz Super App and Kolesa.kz are the logical destinations for all auto related spending, we expect cars to be another source of fast and profitable long-term growth for us.

Turning to some of our other fast-growing initiatives, here also momentum remains strong. During the first quarter, Marketplace valued-added services revenue, increased 4.3x year-over-year. In Kaspi Travel, GMV from Kaspi Tours increased 350% from its launch in 2Q 2023. Meanwhile, Merchant & Micro Finance lending has reached 17% of TFV and alongside Online Car Finance is our fastest growing Fintech product. Each of these new services are not only helping us to keep growing fast but will open new areas for product innovations in the future.

As usual, if we have excess capital, we return it to our shareholders. For the first quarter of 2024, our Board of Directors has recommended a dividend of KZT850/ADS, subject to shareholder approval. As we said at our full-year 2023 results, we will take an opportunistic approach when it comes to future ADS buybacks. Investors should keep in mind though, that over the long-term we believe international expansion is a better route to large and sustainable value creation. When we find the right opportunity, we won’t hesitate to put our capital to work.

The first half of the year has gotten off to a strong start. The consumer and merchant environment are healthy and we’re very much on track to deliver another year of strong top and bottom-line growth.

Mikheil Lomtadze
Kaspi.kz CEO and co-founder

Click on, or paste the following link into your web browser, to view the full announcement.

http://ml.globenewswire.com/Resource/Download/55ab2fe6-89d7-4169-be67-9b073d7abea9

For further information

David Ferguson, david.ferguson@kaspi.kz +44 7427 751 275

FAQ

What were Kaspi.kz's revenue and net income growth rates in the first quarter of 2024?

Kaspi.kz reported a 40% increase in revenue and a 28% increase in net income compared to the previous year.

What was the contribution of the Payments and Marketplace Platforms to Kaspi.kz's consolidated net income?

Payments and Marketplace Platforms together accounted for 68% of Kaspi.kz's consolidated net income in the first quarter of 2024.

How much did the revenue from delivery, advertising, and classifieds value-added services contribute to the Marketplace Take-Rate?

Revenue from delivery, advertising, and classifieds value-added services added 160bps to Marketplace Take-Rate, reaching 9.5% in the first quarter of 2024.

What was the year-over-year growth in e-Commerce GMV and e-Commerce Take-Rate?

E-Commerce GMV grew by 114% YoY, and the e-Commerce Take-Rate increased by 90 bps to 11.1% in the first quarter of 2024.

What dividend per ADS was proposed by Kaspi.kz's Board of Directors based on the 1Q 2024 financials?

Kaspi.kz's Board of Directors proposed a dividend of KZT850/ADS, subject to shareholder approval, based on the strong financial results of the first quarter of 2024.