Joint Stock Company Kaspi.kz

Hello and welcome everyone to the Kaspi.kz first quarter 2025 financial results. If you would like to ask a question and you have joined the call via Zoom, please press the red icon on your screen. If you've joined us on the phone, please press star 1 on your telephone keypad. I will now hand you over to David Ferguson, Head of Investor Relations at Kaspi.kz to begin. David, please go ahead.

Thank you Maxine. Good afternoon, good morning to everyone. Thanks a lot for joining us for our first quarter 2025 financial results. I'm David Ferguson. I'm joined as usual by Mikheil Lomtadze, our CEO and co-founder, Yuri Didenko and Tengiz Mosidze, our deputy CFOs. Deputy CEOs, sorry. So Mikheil will take you through the strategic update. I'll run you through the operational performance in the first quarter. I'll do that quickly and then spend a bit more time on the guidance for the remainder of the year. There's a couple of moving parts to discuss and then we'll open up the call for Q&A. So on that note, I'll hand it over to Mikheil. Mikheil, over to you. Thank you.

Hello everyone, so let's just go through our first few performances. In general, we had a good first few. The company itself is performing at the levels which we expected broadly within our expectations. The payments You know, the continued strong growth, revenues plus 16%, net income 21%. The marketplace in the first group grew 20% year over year and the revenue 33%, net income 19%. And the fintech origination volumes grew 17%, 18% revenue, 8% net income. The monthly transactions have been... Thank you very much. requirements to register smartphones, which was introduced in Kazakhstan and that had a quite significant temporary impact on the demand for smartphones. And then on the fintech side, we see the continuous high interest rate environment, which again will continue probably through this year. and we are here also introducing higher interest new deposit products, which I will talk a bit as well. So next slide, David, please. So the e-grocery, this is the business which we have started, you know, the fastest growing business in our e-commerce. We continue scaling e-grocery. Fast and expect to continue strong growth through the year. The active consumers reached almost 1 million. The GMV 64% up year over year and then the purchases are 66% up year over year with 3.3 million purchases in the first few. As you know, we are operating in the three cities, three largest cities now. and we are planning to enter another two cities so the team continues to execute on the grocery and you see the average ticket is very good stable and yeah we just continue sailing across the country with the Simultaneously, as you know, Kaspi is very good at continuously perform an operational side, but also scale. And we are entering the new cities to support the growth, and we expect eGrossery to continue scaling fast through the year. New term deposits that we have launched for consumers. Those deposits are aiming at a higher interest rate. Our interest rate The environment has been basically due to all sorts of factors which have nothing to do with Kaspi itself. We are in the high interest environment and there is a demand for deposits. which on the one hand have high interest, on the other hand those deposits are for sort of savings where you can top up deposits basically anytime but the term of deposit is actually fixed to the three or six months. The deposits itself have been very successful on the market as you can see we went from basically nothing to 84,000 consumers and almost 379 billion intenge of those deposits. So they're growing fast. There is a demand for those deposits and therefore this product has been quite successful. And we will be, you know, as you know, the strategy we have always had historically is those are the best consumers that are saving with you. and in the future they're making purchases through all our other services and therefore investing into acquiring the consumer deposits and the consumers with deposits have been part of our historical strategy always. Again, in the future interest rates will go down and therefore there is additional opportunity for the profitability. At this stage we are in the insurance environment, therefore we're taking advantage of this as well. We have been going through the different deposit terms upgrades, so this is just a bit of a timeline for you guys to understand. So, for example, we did reduce the deposit in February of 2024 from 14% to 15%, but then in 2025, We do have a high interest environment. So we have introduced six-month maturity deposits at 17%. Then we have increased the rate on all our current deposits from 14% to 15%. And then we introduced the three-month maturity deposit at 18% interest rate. The way that we work with our consumers, for example, when we increase the rate of the existing deposit from 14% to 15%, We repriced our entire portfolio. So that's the way our products work. And we have been doing this consistently for, you know, as long as we have basically deposited products. So that's something you should keep in mind. As soon as we increase the interest rate, we reprice our entire portfolio. So when we went from 14% to 15%, we therefore repriced everything. The existing portfolio of our Kaspi deposit. And now the fastest growing deposits are the ones which offer the higher interest rate of 18 and 17%. A couple of other things. We have raised Eurobonds. This is our first Eurobond, which we have successfully raised 650 million at 6.250%, which is due in 2030. Again, this was for us an opportunity to build a track record with fixed income investors and this is the first Eurobond we have done. And yeah, considering our strategy for international expansion and investments in Turkey more specifically, it's good to be in a position of the financial strength. That's good to build a track record, but also specifically that transaction was successful in our Eurobond fundraising. We have also signed the agreement to acquire Rabobank. And this is a fully licensed bank, which doesn't really have any customers and doesn't have branch network. and this enables us to you know continue developing a fintech products in in the in the turkey and also our initial plan is that you know we'll invest roughly around 300 million dollars in 2025 to fund our fintech strategy in tokyo so david i'm back to you just to go through the platforms