Kadeen Mairs Chief Executive Officer of Dolla Financial Services Limited (Dolla) has released the following report of the Group’s Consolidated Unaudited Financial Statements for the nine (9) months ended September 30, 2022.

Financial Overview
For the nine (9) months ended September 30, 2022, Dolla reported consolidated profit before tax of $201.3 million which represents a 257% or $144.9 million increase over the corresponding period ended September 30, 2021.

Profit before tax for the quarter ended September 30, 2022, was $70.2million; an increase of $47.8 million or 214% over prior year.

Total income year to date (YTD) stood at $475.2 million, an increase of $298.9 million or 170% year on year. Total income for the quarter was $176.9 million, a $108.8 million or 160% increase YoY.

Dolla recorded net interest income before expected credit losses (ECL) of $164.2 million in Q3, an increase of $110.5 million or 206% YoY and $435.9 million YTD.

This increase was driven by the growth in our loan portfolio which positively reflected in both our balance sheet and interest income.

Interest expense remained relatively flat for the nine-month period; increasing by $2.0m or 12% YoY. The effective use of debt to drive growth in the loan book has impacted the movement in interest expense.

Operating expenses for the quarter totalled $95.9 million, representing an increase of $15.5 million or 19% quarter on quarter and $50.2 million or 110% increase Year on Year (YoY). The increase was primarily attributed to increased staff costs as we continue to build capacity to support the company’s growth.

Other costs were associated with process improvements to better serve our customers. ECL for the period also increased by $4.7 million or 28% over last quarter. This results from the growth in our loan book as well as a marginal increase in nonperforming loans.

Earnings Per Share (EPS) for the quarter of $0.04, a reduction from $1.36 in September 2021. This is due to the increase in shares issued from the Initial Public Offering (IPO).

The Company’s efficiency ratio stood at 47% a 4-point increase from the 43% reported last quarter and remains relatively low. Management has taken an active approach in maintaining lean operating expenses, ensuring maximum profitability and return to shareholders.

The Company recorded total loans receivable net of ECL of $1.2 billion for the period ended September 30, 2022, an increase of J$649.5 million or 125% relative to September 2021.

As a result of the IPO, the demand for Dolla’s products has significantly increased and this resulted in increased disbursements over the period. As at September 30, 2022, business loans accounted for 73% of the total loan portfolio, with personal loans accounting for the remaining 27%.

Furthermore, secured loans represented 72% of the total loan portfolio, while unsecured loans accounted for the remaining 28%. The increase in secured loans continued to have a positive effect on the quality of the loan book and the maintenance of low ECL.

Non-performing loans (NPLs) increased from 6.0% to 8.7% quarter over quarter. While NPLs have increased, the overall arrears remain within budgeted expectations.

Management has implemented several strategies to bolster collections to contain delinquency. These strategies will result in a reduction in the Company’s arrears balances in the short term.

The Company recorded total liabilities of $644.8 million for the period ended September 30,2022; an increase of $109.2 million or 20% quarter on quarter and $103.7 million or 19% YoY. The increase is directly related to the increase in the funding of debt during the quarter. Loans payable and Short-Term Borrowings increased to $532.1 million from $429.9 million in the quarter due to a bridge loan received from FirstRock Private Equity (FRPE).

Shareholders’ Equity was $715.4 million as at September 30, 2022, representing a 9% or $61.9 million increase quarter on quarter and $655.1 million or 1321% increase YoY.

The increase stems from the $250.0 million received from the issuance of shares from the IPO in June 2022 as well as the increase in profits throughout the period.

The Company is pleased to announce the successful raise of $1.0bn through the issue of its Corporate Bond and exercised its right to upsize to $1.5bn. The funds will be used to refinance existing debt, support acquisitions to grow the loan portfolio as well as fund organic growth.

As Dolla continues to grow and the demand for its products increases, the Company is well positioned to seize opportunities including partnerships which will support expansion and reach. This focus has led to various partnerships including Innovative Systems whereby Dolla will provide financing for its customers who want to purchase technological products.

Dolla has ended its third quarter strong, which demonstrates the Company’s ability to innovate and execute the company’s long-term strategy. Our loan book and portfolio quality have reached an all-time high and our year to date (YTD) income surpassed $200 million. On the back of these successes, we move into the last quarter of the financial year (FY) with vigour to execute the final phases of our strategic plans for FY22.

Our primary goals remain to provide quality service and products to our customers and to increase value to our shareholders.

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