Joint Stock Company Kaspi.kz

Hello everyone and welcome to Kaspi's first quarter 2024 financial results. My name is Harry and I'll be your operator today. If you would like to ask a question during Q&A, please use the raised hand button on your Zoom toolbar or dial star one if you're joining us over the phone today. It is now my pleasure to turn the call over to David Ferguson from Kaspi to begin. David, please go ahead when you're ready.

Hi, thank you, Harry. Hi, everybody. Welcome to our first quarter 2024 financial Financial Results, a conference call. Joining me on the call today, we've got Mikheil Lomtadze, our co-founder and CEO, Pavel Mironov, our chief operating officer and deputy CEO, Tengiz Mosidze, chief financial officer and deputy CEO, and Yuri Didenko, head of capital markets and deputy CEO. As usual, Mikheil will take you through the strategic updates I'll take you through to the financials section and then we'll open the call up for the regular Q&A. So on that note, Mikheil, over to you, please.

Thank you, David. So let's go straight to some of the strategic updates for the first Q. So the quarter is has been strong, so we're off a good start on 2024. The payments TPV has grown nicely 35%, tracked by revenue growth of 25% and net income growth of 25%. Marketplace GNV is up 62%. Revenue is up 108% on the marketplace, driven by the Thank you very much. and the net income plus 3% growth and as the interest rates will be going down there is a significant profitability cushion actually in the fintech business but the volumes are nice and the high quality which is reflected in the revenue growth. We continue to be extremely relevant for our consumers so 71 monthly transactions per active consumer which is the world class standard again 71 transactions per Thank you very much. Next slide. As you see, we have been on this journey of building the payments marketplace and fintech platforms and As the payments and marketplace are the fastest growing, we are really happy now in the first queue, pretty much having them contributing roughly the same share to our bottom line. And if the investors have been following us since initially becoming public on the stock exchange in 2020, this mix has dramatically changed, right? I mean, before that, It was actually pretty much opposite with the fintech actually dominating. And at the moment, we have 68% coming from the fastest growing payments in the marketplace platforms. We have been also putting together and working on what we call value-added services. I mean, those are the services which basically deliver additional value to our merchants and our specifically our marketplace platform. So here you can actually see that our added value services have grown extremely nicely. They now contribute 1.6% out of 9.5% of total take rate on the total marketplace GMV. The classified is the businesses which we entered and acquired last year. So they contribute to Thank you very much. are now in our advertising. And then delivery, which we started to monetize sort of last year, you can see that have grown dramatically. And now they also contribute meaningfully to our take rate. In general, we are over four times up compared to the last year's first skew in validated services. And each of those is growing nicely and fast. And what is, again, extremely important to keep in mind that E-Grocery is a really exciting business, which we pretty much Thank you very much. Double the number of purchases of last year. And if you remember, we're going around the larger purchases, which is weekly purchase, significantly larger average ticket. And that also grow nicely to 14,000 tenge quarter over quarter. So we are firing on all cylinders and launching another major CP in Kazakhstan as we speak. And this year we'll be focusing on three largest cities which represent the majority of retail trade in the grocery business, and that is Almaty, Astana, and Shymkent, and that would be our priority for the year. Another innovation which came from us last year was tours, which is basically family vacations. We have been growing that business Thank you very much. through the seasons this year. So really excited about that business and our consumers love it. And for us, it's the most important reward from our consumers is really the feedback and excitement they're sharing with us. So we're really excited about that business and we'll continue scaling through the year. As we've entered the business of cars last year through the acquisition of which is the leading car classified alongside with the real estate but the leading car classified specifically for our innovation. We have basically told you that we're excited about that business not only because it's a leading classified platform but actually for the fact that now probably acquiring a car is the second largest important decision of the family household and so on. So there is really a wide suite of the services around the car. So as a result, you know, now we are really happy to present you some of the strategy around the cars, which we are scaling, will be scaling through the year. So the number of cars in the country in 2023, the registered cars was roughly around 5 million cars that are owned in the country. The cars which changed ownership during the year, there were about 1.9 million cars. And the number of cars which are actually listed on the Kallosa car marketplace is about 2.4 million. So that just tells you that Kallosa is really the place to go if you want to buy a car. and the value of cars listed on Kallosa is around 37 billion. And the average price of a car listed on Kallosa is about 15,000. So that basically is a huge market and we are in the beginning of our journey to actually revolutionize not only car purchasing experience but actually everything around the car ownership. So the idea is that we are putting together and working is we're really focused on not just a beginning of a consumer's journey with the car. So actually, in most of the whole journey, you would buy a car. You would actually own the car. You need to serve the car. And then at some point, you still sell the car. and then you buy another car. So this business for us, and this is probably also not just the buying the car is important, significant part of the family's household budget is actually going to everything around ownership, around the serving of the car and we believe it's a huge market and if we leverage the data, we leverage technology, we leverage our products, we can really create a remarkable consumer experience. Some of the examples of the different type of services we have in mind, if you look at the car ownership, you buy a car, you need the car financing in order to acquire it, and then you register ownership of the car. You need to insure the car. There is a car and estate-related taxes you have to pay. You issue the driving license or the new driving license. You clean the car. You service the car. You fill it with the petrol. You buy the tires, you buy the auto parts, and then you sell the car, and the whole cycle starts again. So there are so many different multiple touch points around owning and serving the car that we believe that technology to pulling everything together and create first-class consumer experience, I think it's a really exciting opportunity. We really know that we can make our consumers' lives better and we just need to leverage the data and we need to leverage the technology in order to enable this seamless experience around everything around the car. Surprisingly or not surprisingly, some of the services already have been built by us for the last several years. So if you actually take a view of some of the services which we're now pulling together and some of the touch points that we have, they already can give you and an indication that this is something which we have been thinking about in launching services historically around different touch points. And now this comes together into a bigger picture, right? So we have e-cars, which basically is Galloza enabling to sell and to connect buyers and sellers around the car purchase. We have online car finance, which is one of our fastest growing FinTech products right now. It's pretty much fully online. Thank you very much. Just launched this quarter, sold around 1.2 thousand cars when we actually buy and sell cars ourselves, considering that we can build this incredible online experience for our consumers. And then there are validated services through the GovTech platform, which I think Kazakhstan can be extremely proud of. being launched together with the government agencies that you can register a car fully online over coffee in the evening. You can actually pay taxes. And there have been around 2 million car tax payments only in the first queue. You can drive a license. You can issue the driving license. Almost 70,000 driving licenses have been issued. So there are different touch points which we currently have. And by leveraging the technology, we are just pulling this together to take the consumer experience even on more seamless level than before. So really excited about this business opportunity. So if you look at the e-car GME now, we combine different businesses so that that gives you a bit understanding of everything what we do around the cars. So if you look at the car 3P, that's when the car is being sold and the buyers. We connect them on the marketplace. Car parts or auto parts is actually everything from tires to the parts which we also sell through our marketplace already. And then GFV of a 1P is 7% of GFV now, but it's actually about 1.2 thousand cars which we have just sold in the first queue. So, every ticket is high. Therefore, even though it's a 7% of the e-cars, GMVs, just the 1.2 thousand cars really. So we're just beginning to scale that business. Just to give you a little bit of a heads up on the economics of actually, and the take rate is quite healthy, 4.6%, and as we continue getting the scale, the take rate will be expanding. So if you look at the sum of the economics of actually selling the cars, so it's one piece, so we have managed to sell 1.2 thousand cars Value of cars that we sold is around 7% of car GNV. What is, I think, remarkable, there are things which you really focus on in this business, and that means how many days it takes you to sell a car, because that's probably one of the most important KPIs. So it takes us around 30 days. So within the month, we basically buy and sell a car. And already on 1.2 thousand cars, that business is profitable, which I think by itself is Thank you very much. is already in this business. So as you can see, we're evaluating the car based on proprietary technology, but also our ability to understand the defects and understand the quality of the car before we actually buy the car. So that's something which we have been also developing basically starting from last year and now we are fully operational and from now on you can only see the Thank you, David. All right. Thank you, Mikheil. So I'll run you through the three respective platforms and the consolidated financial numbers. So starting with the payments platform.