Welcome to Qliro Q4 Report 2022. For the first part of the conference call, the participants will be in listen only mode. During the questions and answer session, participants are able to ask questions by dialing star five on their telephone keypad. Now I will hand the conference over to CEO Christoffer Rutgersson and CFO Robert Stambro. Please go ahead. This call is being recorded. Welcome to Qliro Q4 Report 2022. For the first part of the conference call, the participants will be in listen only mode. During the questions and answer session, participants are able to ask questions by dialing star five on their telephone keypad. Now I will hand the conference over to CEO Christoffer Rutgersson and CFO Robert Stambro. Please go ahead.
Welcome to the presentation of Qliro's year-end report for 2022. My name is Christoffer Rutgersson, and I'm the CEO for Qliro. With me today, I also have our CFO, Robert Stambro. 2022 was a transformational year for Qliro, marked by significant improvements in our platform capabilities, launching a new strategy focused on safe and simple e-commerce payments with a relentless commitment to our merchant-focused approach. We also built a new team to execute on the strategy while making sure to become a profitable business in the short term. I'm confident that our strong position in e-commerce payments for Nordic enterprise merchants, coupled with our proven track record of delivering flexible solutions that drive conversion or increase sales for merchants and supporting our merchants international growth journeys has set the foundation for an exciting period of accelerated growth in our payment solution business.
We're also excited about packaging these capabilities for smaller companies, given our new expansion to the market segment of small and medium-sized e-commerce segment. Next page. As mentioned before, we have made significant investments in strengthening our team in the past year. In the quarter, we have welcomed several new leaders to our executive management team, as mentioned last time. In January, we welcomed Robin Soubry as our Chief Product and Marketing Officer with almost a decade of experience in product management within e-commerce payments across Europe from Ingenico and most recently Worldline. Robin just moved to Stockholm together with family from Brussels in order to join Qliro, and we're grateful to have him here.
We have also welcomed Anna Engman as our new Chief People Officer with extensive experience from talent acquisition within tech, as well as building other successful tech organizations in the past, most recently at Detectify. We welcomed Carl-Åke Nilsson as our interim Chief Risk Officer, and he's the former co-founder of Sevenday Bank. He will be here for the short term before we have a permanent risk officer in place, which is expected to join Qliro in early Q2. We have also added many new leaders across the Qliro team as part of our ongoing efforts to enhance our operating model and to execute on our strategy of expanding within payment solutions.
More than 50% of all leaders in Qliro are new in their positions since I was announced as a new CEO this summer, with a good balance of external recruitments and internal promotions. Rebuilding our extended leadership team with new talents bring a wealth of experience and expertise. I'm confident that their new positive energy will also play an important role in the achievement of our payment strategy and long-term growth plans. In the fourth quarter of 2022, we report a 6% increase in our revenues despite the general decline in the e-commerce market. For the full year, we have seen an 8% growth in revenues. Furthermore, we took SEK 28 million in cost within our profitability program, and we have now completed the previously communicated one-off investments related to the profitability measures by the year-end of 2022.
This reflects our high level of activities in the business to deliver on the transformation of Qliro and our ongoing efforts to drive profitability and position us for a positive earnings before tax, which is expected in 2023. Our cost development, excluding items affecting comparability, increased by 6% in Q4 and by 1% for the full year. This temporary increase in underlying cost in Q4 was due to investment in our ongoing transformation that we haven't included as items affecting comparability, I will let Robert comment on the details later in our presentation. We have also successfully onboarded four new small merchants in the SME segment during the quarter, we have an onboarding backlog of eight additional new merchants which have signed contracts with Qliro but didn't go live during the Christmas sales period.
All of these new merchants are SME, and now we are expecting them to be live before the summer. Finally, I'm glad to report that our Black Week and Christmas sales was successful and without incidents. This was due to our investment in modern methods and capabilities for continuous end-to-end testing of our systems, which was introduced in the third quarter. Our commitment to improving and maintaining high uptime and technical performance of our services remain a priority as we will continue to invest our technology platforms to improve our leading merchant experience. Regarding our profitability program, during Q4, we made significant progress towards the implementation of the full profitability program. Our efforts have resulted in several initiatives being completed, and we remain focused on the remaining ones.
A total of SEK 28 million was recognized as items affecting comparability within the program, of which SEK 15.5 million going towards consultancy costs aimed at driving efficiency and implementing new systems. The rest of the expenses included increased amortization of old technology, as we are now fully live with our new data platform of Snowflake, as well as our new platform for our merchant web. The expenses also included severance costs, recruitment costs, and optimization of our office space. We have now completed optimization and upgrade of our office spaces, which will result in cost savings of approximately SEK 45 million in 2023, given that we have reduced our total space. We also took steps to reduce our use of consultants, concluded negotiations with external suppliers, and initiated the process of digitalizing and automating our customer support, sales, and finance departments.
During the quarter, we migrated our older customer support systems to a new platform, which will enhance our operational efficiency going into 2023. Additionally, we just went live with our new CRM system for marketing, sales, and onboarding, which will improve our process for demand generation, which will help us attract, win, and activate new merchants. We're also upgrading and migrating our financial systems with the aim of optimizing our financial processes and reporting within our finance department. We also digitalized our first large batch of customer sendouts, previously sent by physical e-mail, which is quite costly, and we will continue to digitalize the remaining parts of our consumer journey and touchpoints during 2023. These digitalization initiatives are expected to result in cost savings of approximately SEK 10 million during the full year.
In conclusion, we have completed our investments for all previously announced initiatives under the profitability program, with the exception of some internal work and technical developments that will continue during the first half of the year. Given our achievements so far and current trends in the business, we expect to reach our profitability target for 2023. With that, I hand over to Robert for a more detailed financial review. Thank you.
Thank you. Thanks, Christopher. Let's look at the financials and focus on the Q4 figures. Income grows with 6% in a declining e-commerce market. Income growth is driven by a 9% income growth in payment solutions. As previously communicated, Qliro's board of directors decided on a profitability program starting in Q2, spanning until the year end. The purpose was to accelerate the company and to reach profitability during 2023. We have invested a total of SEK 46 million since the start of the program, whereof SEK 28 million in Q4. This was in line with the board's intention. We are now ready to deliver on profitability 2023. All costs taken as a part of the profitability program are reported as items affecting comparability. In Q4, Qliro also received a VAT deduction for 2020 and 2021, reported as an item affecting comparability.
This had a positive effect on our operating profit of SEK 10.3 million in the quarter and will further strengthen Qliro's position towards profitability. Costs, excluding the items affecting comparability, grew with 6% and in line with income growth. This 6% cost increase has been taken to further speed up the acceleration and transformation of Qliro, even though it's not classified as an item that affects comparability. Please be aware that this should not be perceived as a new cost run rate. The credit losses compared to last year, looks at first sight that they are growing a lot, but it has its explanations. In Q4 2021, we released SEK 7.9 million, given a renegotiated volume guarantee agreement and improved credit modeling.
In Q4 2022, this year, we had extra provisioning due to revaluation and write-downs of SEK 7 million connected to the macro environment. To enhance comparability between the quarters, we take out these net effects of SEK 14.9 million, and the adjusted net credit losses thereby grew with SEK 2.8 million, driven primarily by payment and its loan book in absolute terms. Let's turn our eyes towards the segments in the quarter and start with payment solutions that stands for the majority of our income generation. The PAD portfolio continued to show resilience in a weak market development. The loan book continued to grow, driven by changed customer preferences in the checkouts. Customers are to a higher degree using our part payment products or account products in favor of invoices. Invoice volumes were down 20% year-over-year, while account volumes was up 8%.
In total, PAD income grew by 9%. Operating income margin reached 22.3% in the quarter, which is a very attractive margin and 70 basis points higher than same period last year. As mentioned, we had extra provisioning in Q4 due to revaluation and write-downs of SEK 4.1 million in this segment connected to the macro environment. In Q4 2021 last year, we released SEK 4.5 million, given a renegotiated solution rate, guarantee agreement and improved credit modeling. In the adjusted credit losses, we have removed this net effect of SEK 8.6 million to enhance comparability. The underlying credit losses over volume have increased through the long-term trend, as illustrated by the adjusted role in credit losses.
The increase of underlying credit losses is explained by the 6% loan book growth together with the changed customer behavior, where customers choose part payments or account products in favor of invoices. The account products have better margins but require higher credit reservations than invoices. To sum it up, we continue to show good resilience in a weak market sentiment and income grows with 9%. Customer have changed their behavior in the checkout, favoring account products, and the increase in credit losses are explained by higher reservations driven by loan book growth and customer favoring account products. As you know, our personal loan book has been decreasing in size since the pause in marketing a year ago.
When looking year-over-year, the loan book declined by 17% and income declined by 9%, meaning that operating income margin level grows with 70 basis points, reaching 7.9%. New customer loans reached its lowest point in Q2 and Q3 2022 and started to pick up again in Q4, thereby slowing down the balance deterioration. We have during the quarter worked with initiatives to stabilize the loan book trend, where we proactively offer top-ups together with improvements in our customer communication. We will continue to work with sales activities with the aim of further stabilizing the loan portfolio balance. As you know, we had extra provisioning in the quarter due to the increased macro uncertainties with effects at Q4 with SEK 1.4 million. In Q4 2021 last year, we released SEK 3.4 million given improvements in the credit model.
In the adjusted credit losses, we have removed this net effect of SEK 4.9 million. The losses thereby decreased with SEK 0.1 million year-over-year. Remember, the loan book declined by 17%, meaning that credit losses over loan book increased. The reasoning for the increase in credit loss over loan book is due to a mix effect. We tend to attract less low-risk customers into the personal loans portfolio than previously. This has a positive effect on our income margin with 70 basis points and a negative effect on the adjusted rolling credit losses with 40 basis points. To sum it up, we see a stabilization of new lending starting to pick up from Q2 and Q3 levels. However, with a loan book that is still decreasing in size.
The mixed effect in the portfolio has improved operating income, which given the increased risk levels, also increased adjusted credit losses. First of all, we invested a total of SEK 28 million as part of the profitability program and a total of SEK 46 million since the start of the program. We see that this will have the intended effect on both income and cost. We also had a positive outcome from the Swedish tax authorities, where we received a VAT deduction of SEK 10.3 million that had a positive effect on our result. Summing it up, a total of SEK 7.8 million of items affecting comparability affected the Q4 result. This implies an underlying cost growth of 6%, where underlying costs reach SEK 98 million, SEK 5 million higher than Q4 2021.
The 6% cost increase versus last year should be viewed as temporary for the quarter and not as a new run rate. The increase in underlying costs have been taken to further speed up the acceleration and transformation of Qliro, even though it's not classified as an item affecting comparability. On the graph to the right, this can be seen both on other costs and IT costs. Important to remember is that it will take a couple of quarters until the savings and growth initiatives will materialize before we reach its full effect in 2024. We are confident to reach profitability for the full year 2023. Before I hand over to Christopher, we should have a look at capital and liquidity. Our capital base is built up by CET1 capital and Tier 2 instruments.
The total capital headroom towards the regulatory requirement is currently 5.1%, or SEK 145 million. Our liquidity position is solid, with a liquidity coverage ratio above 200% and a net stable funding ratio above 125%. The majority of our financing is via deposit in EUR and SEK. All in all, we see that we can grow our balance sheet without altering our financing means. With that, I hand over to you, Christopher.
Thank you, Robert. As we move forward, we remain focused on improving our operational efficiency further while executing on our accelerated payment strategy. We will continue to develop our offering for both enterprise and smaller merchants. Our priorities for the next quarter include completing the profitability measures we have outlined, which will then allow us to refine our strategic planning with our new executive team and define our long-term financial targets. Once again, thank you for your time. We look forward to updating you on our progress in the coming quarters. Now let's conclude with the Q&A.
If you wish to ask a question, please dial star 5 on your telephone keypad to enter the queue. If you wish to withdraw your question, please dial star 5 again on your telephone keypad. There are no questions from the telco at this time, so I hand the word back to the speakers.
Thank you. We have received a written question via the webcast from Christian, which is, how is the pipeline for signing larger merchants? In general, we do not guide on our pipeline, but we can however state that our pipeline is larger than at historical levels, and our growth ambition relates to both growing enterprise and our small and medium-sized segment, and we are confident that both will contribute to our growth going forward. In addition, signing and onboarding of enterprises generally takes longer time than SME. Even if we see a larger pipeline than before, we don't expect it to materialize in the short term. We will announce new enterprise merchants as soon as they are signed, and we communicate it through a press release. Thank you.