Dear listeners, good morning. Welcome to DelfinGroup Investor Webinar. Today, the CEO of the company, Didzis Ādmīdiņš, and CFO Aldis Umblejs will walk us through the recently announced financial results of 2021. During the presentation, you're encouraged to ask your questions to the company by typing them in the chat window. We'll cover them in the second part of the call. Now, without further ado, I would like to hand over to Didzis and Aldis.
Thank you. Hello, dear participants, ladies and gentlemen, investors and shareholders for joining our DelfinGroup Webinar. Today, here we are. Yes, I, Didzis Ādmīdiņš, CEO of the company, and Aldis Umblejs, CFO of the company. Today we will present to you unaudited results for corresponding 12 months of last year. I will tell you about actualities and highlights of the company, and Aldis will tell about financial and business data of the company. As always, at the end of presentations, we will be glad to answer your questions. Let's start presentation. Yes, let's talk about last year, about 2021. In my opinion, last year was most successful year of the company. We have a lot of improvements in company.
First of all, at the beginning of last year, we changed the legal structure of the company from limited liability company to joint stock company. Then, at the end of March last year, the new Supervisory Board was appointed. We had a lot of product improvements. We had good additions to our management team. Since the very beginning, we are already 12 years profitable. Company is not even 13 years old, but it's 12 years profitable. We had good improvements in all our business segments. For example, consumer loans, we had several records for that business segment. We had the best months, best quarter in terms of loan issuance.
Credit portfolio reached record levels. Also, incomes for this business segment reached record levels. Overall, it was a really good year for our consumer loan segment. Also, we had good improvements for pawn loan segment. We made the acquisition of credit portfolio of fourth largest pawn loan operator in Latvia, Moda Kapitāls. During that we significantly increased our market share. Despite difficulties with COVID-19, we managed to increase our business metrics for that segment. If you look at segment of retail pre-owned goods, we see that more and more people are willing to buy and sell these pre-owned goods to us because they evaluate the service which we are offering, the safety, the guarantee which we are giving.
Overall, we see that this segment is really growing for our company and more and more people willing to be part of circular economy and extend those life cycle of those items which we are selling. Let's go further about highlights of the company. Yes, as I mentioned, the IPO, which was the biggest event of last year. The almost 6,000 shareholders joined our company, and we really evaluate that. Talking about our management team, Sanita Pudnika joined our management team at the end of last year. She has good experience across insurance, banking and fintech, and I can say she is a fintech professional. Since yesterday, she is also on our management board.
Talking about funding, as we promised during IPO, that we will pay back most expensive debt after IPO. Until end of the year, we paid back three most expensive bonds with a coupon rate 14% and 12% annually, of a total volume of EUR 13.5 million. We issued a new bond with coupon rate of 8%, and the subscription period is ongoing at the moment, and more than EUR 7 million is already subscribed. Yes, last year and this year, we are also active on social activities.
For already several years we are supporting senior institution and children's hospital, and at the end of last year, we supported more than 200 younger people to for education for digital skills and digital marketing. Just this week we made EUR 100,000 donation to help Ukraine. Just some other highlights of last year and beginning of this year, we opened this.
At the start of this year we opened new branch in Riga, Zolitūde, and also at the end of last year we opened one new branch in Daugavpils, the second largest city of Latvia, and that branch in Daugavpils were from acquisition of Moda Kapitāls and which previously worked under a brand name Banknote and during that acquisition of credit portfolio, we made acquisition also of this branch and opened a Banknote branch at this place. At the end of last year, we had 93 branches across Latvia.
We had several product improvements, for example, for Banknote and VIZIA, we increased maximum loan amount from EUR 5,000- EUR 7,000 and also we extended the maximum loan term from five to seven years and that's, I could say, a result of very good payment discipline of our clients and also we see there is a good demand for such kind of credit. Also talking about product improvements for VIZIA, we launched a new credit line type of credit and that's the credit line up to EUR 3,000 and also we see that very good demand for this kind of credit and significant part of VIZIA issuance is like issued already on this type of credit.
Also I want to say that last year and also this year, our full focus is on how to improve our product offering to make it wider, to add the new products, to really strong focus on how to improve our products. We look very seriously on UX and service improvements. For example, we introduced new identification methods last year and also we introduced possibility to fill application and get loan through WhatsApp and we are looking other ways how to improve this user interface and UX for our clients.
There is some photos of last year, our mobile app, which we already mentioned and, of course, a photo from Times Square of our when our shares started to list on Nasdaq Riga. Now I will give screen to Aldis and he will tell you about business data and the financial data of corresponding period.
Okay. Thanks, Didzis. I will be taking over and talk about the financial performance of the group. During the fourth quarter, DelfinGroup continued a strong growth in all business segments, as well achieved the best results in the history of the company. The total amount of loans issued in 2021 reached EUR 52.45 million and that is an increase by 10% compared to 2020. This is in line with our long-term targets to reach the net portfolio of EUR 70 million by end of 2024. The total accumulated revenues end of fourth quarter reached EUR 25.5 million, and they grew by 39% compared to the third quarter, and by 8% on a year-on-year basis.
This is a result of the increase of issued loan volumes throughout the year and the increase of the outstanding loan portfolio at the year-end. As for EBITDA, it increased to EUR 3.2 million, an increase by EUR 800,000 compared to the previous quarter, and on a year-on-year basis, EBITDA increased by EUR 700,000. That was an increase by 28% compared to the last year. This was achieved due to the increase in revenues and better payment discipline of our clients. The profit before tax reached EUR 1.7 million for the last quarter, an increase by 42% compared to the third quarter and by 42% also on a year-on-year basis.
The fourth quarter profit before tax was the largest ever quarterly profit in the history of the company. Moving forward, I will discuss briefly in more detail our business segments, consumer loans, pawn loans, and then sale of used goods and their performance. Following the strong demand for our consumer loans, the net portfolio grew by EUR 4.7 million in the last quarter in 2021. On a year-on-year basis, the increase was even more spectacular. The portfolio grew by EUR 12.5 million or 51%. The portfolio growth is in line with our long-term financial targets.
Our focus on extending the repayment terms as well as increasing the maximum amount available to clients are reflected in the increase of the average loan amount and the weighted average term of the loans issued. The non-performing loan ratio, loans exceeding 90 days past due, has decreased also during the fourth quarter and was the lowest ever, 1.9%. Such a result was achieved by applying prudent underwriting procedures as well as by using third-party debt sales companies for part of the non-performing loan portfolio. The pawn loan portfolio continues to grow for the fourth consecutive quarter.
Although it is slightly behind the level of 2020, please bear in mind that most of the time throughout 2021, there were various COVID-19 restrictions imposed in Latvia, limiting the number of customers we were able to serve in our branches. Any further lifting of restrictions should positively affect the pawn loan segment going forward in this year. The sale of pre-owned goods continues growing also in the fourth quarter, reaching EUR 2.4 million. Similar to the pawn loan segment, also here there has been some negative effect from COVID-19 on the sale of pre-owned goods, since majority of our sales are done through our physical shops.
However, by focusing more on online sales, we have been able to shift a larger part of the sales through online channels, and a larger part of our customers value the convenience in making their purchases through our online shop and goods being delivered to their homes. The total revenues for the fourth quarter increased by 10%, thanks to the continued strong demand for the consumer loans and the overall growth of the loan portfolio. The credit loss expenses for the fourth quarter have decreased because of the sale of a non-performing loan portfolio to asset collection companies that was done end of the year. This all resulted in the increase of after-tax profit by 53% compared to the previous quarter and 3% on a year-on-year basis.
As for the balance sheet, the total balance sheet has increased by 30% following the increase of the loan portfolio, and that was largely financed by the proceeds we received during IPO. The financial ratios show the good performance of the group it delivered in the fourth quarter of 2021. I would like to point out specifically the equity ratio, since this, as expected, has increased significantly during the fourth quarter because of the received IPO proceeds as well as the good results the group delivered on the fourth quarter. Likewise, in line with our financial strategy, we aim to maintain this financial ratio at a high level going forward.
The cost of interest-bearing liabilities continues to decrease and has reached an average of 7.5%. This is the lowest average rate ever for the group, and it is in line with the goals we set during the IPO. It was achieved by repaying and refinancing our most expensive interest-bearing liabilities, and I will touch upon that in the next slide. DelfinGroup continues to employ a balanced capital structure that consists of equity borrowings by bonds and then financing attracted through Mintos platform. As it is mentioned previously by Didzis, following the IPO, we repaid one 40% coupon bond on maturity and made an early redemption of two bonds with 40% and 12% coupon rates.
In addition, during November, the company started subscription for a new bond emission with an 8% coupon rate. The subscription is still ongoing, and up until now, over EUR 7 million have been subscribed. As it was communicated during the IPO process, company is committed to pay out regular dividends to shareholders and has done so at the end of December by distributing the first dividends after IPO. In total, EUR 512,000 were distributed to shareholders for the third quarter of 2021. In addition, on last Friday, the company proposed to distribute another EUR 780,000 as fourth quarter dividends, which shareholders will vote on during the Shareholders Meeting on March 28.
In total, it is expected that the company will pay out dividends five times during 2022. Although the share performance is a little bit disappointing, and the price over the year it was below the IPO price, compared to the other financial industry peers, DelfinGroup shares are relatively cheaply valued, and offers a potential good investment that is justified by good financial results and as well as the attractive dividends. To receive the latest information and news about our company, we encourage you to subscribe to our newsletter. This can be done through our website that is shown now on the screen. With that, I would say we conclude our presentation, and we can move forward to the questions and answers session.
Gentlemen-
Yes, thank you, Aldis.
Thank you. It seems that the presentation and the financial results have been exciting enough since we have received plenty of questions. Let's start with the first one. From which date Moda Kapitāls financials and portfolio are reflected in DelfinGroups numbers, and what was the size of Moda pawn portfolio at the time of the consolidation?
Okay. Aldis, you can cover this one.
Yeah. The Moda portfolio sale sales numbers are included both in the third and the fourth quarter because the sale was ongoing starting basically the moment we announced that. We took over the pawn shops gradually, as well as loans, and the goods. The total amount is around EUR 700,000 if I'm not mistaken.
The small correction, credit portfolio was about EUR 350,000 and other thing was shop, let's say, shop portfolio, the items which we afterwards will sell in our branches.
Right.
Yeah.
Thank you. The next question is related to the dividends. Can we expect some additional annual dividends added to the latest quarterly dividends of EUR 0.0172 per share?
Aldis, can you cover this?
Yes.
Answer this.
Yes, I can cover that, and I can answer with a yes. As mentioned in the slides covering the dividends, I mentioned that we will pay out the dividends five times during this year. That includes four quarterly dividends and one annual dividend for 2021. Regarding the amount that will be decided at a later stage and will be proposed to the shareholders when the audited financial statements will be made available.
Thank you. Third question. Considering the strong loan growth in fourth quarter, how did you manage to keep the amount of booked credit losses so low?
Yes, I can answer on that. Basically, that is the reason for two things. One is the performance of the portfolio as such has improved, and we see that there wasn't a need to create additional loan loss provisions. Second, also I mentioned that we sold part of a non-performing loan portfolio to outside collection companies, and that's. By doing that relieves some of the provisions that offset the provisions we should cover, and that's a net effect.
Thank you. Please explain the difference in the sales numbers of pre-owned goods if compared the data in the presentation and in the Q4 report. There's seemingly a difference. One data source refers to EUR 2.4 million, while the other one to EUR 1.6 million. This perhaps is something that you can also look further into, if needed.
I think I won't be able to answer on spot because I have to look into that.
Maybe that is with markup or without markup. I just search. Maybe we can chat, check, and later answer for this question.
Yeah, we can follow up on this and provide comments a little bit later.
Very good. Thank you. When do you plan to close the current bond issue?
Actually we haven't set a concrete time when we finish it. Basically we tap an issue of new bonds based on the need for additional financing. I think when we see a point either we finance them all or basically we aim to finance all of the issue, but we take it gradually because of the funds we need at certain point. There is no specific closing time right now.
Thank you. Could you please explain a bit further the yield compression that has happened in fourth quarter? Is that in line with the strategic 2024 target?
Okay. It's a little bit hard to answer not knowing to which particular number is this referenced to?
If we may ask the investor, could you please follow up on the specific item that you're referring to? That would allow us to-
Yeah, maybe the slide would be good to have the slide number, yeah, and more details so we could answer.
Thank you. The next question, looks like you further utilized Mintos financing in fourth quarter. Can you disclose on the effective interest rates on that financing source?
Yes. We continued using Mintos platform. The rate for Mintos it's in a range and basically it depends on the term of the loans we are financing. Let's say it's around 7.5%, and that's reflected also in this total average financing cost that we have at the end of the fourth quarter in the slides that we showed previously.
Mm-hmm. Thank you. Currently the last question that we have received, what is the expected impact on Russian invasion in Ukraine on business? What has been done to mitigate the risks?
Okay. I can start and maybe Aldis then can continue. First of all, we don't have any business in Russia or Belarus and our business is only in Latvia. In that perspective, I could say it's safe. Of course, if you look at capital markets, it could be impacted. But at the moment, as you see, also in Nasdaq and other capital markets that it's quite stable. Of course we watch the situation very seriously and we evaluate those risks how they can impact our business case.
I see that would be mostly on capital market side, not so much from demand side or how our clients can fulfill their obligations to pay back loans. Okay.
Yes. I can agree to what Didzis said. Yeah. We don't have direct effect from Russia and Ukraine, but yeah, nevertheless, being in the stock exchange and also having bonds and yeah, that could be some effect. Up until right now we cannot estimate that and we'll see.
Thank you, gentlemen. It seems we have managed to answer all the submitted questions. With this, participants, I would like to close the call. We have recorded this, so the recording will soon be available in DelfinGroups announcements. Participants, thank you for your active engagement today. Aldis, Didzis, thank you for the presentation and for the answers given.
Yes. Thank you. Thank you for this presentation, and thank you all participants. I want to say that subscribe to our newsletter and all the latest news we will send for all the subscribers once a month and there will be all the latest data and all our highlights of the company. Thank you everyone.
Yeah. Thank you.