8/5/2025
The Board of Directors of Kruso Kapital has approved the consolidated financial statements as at 31 March 2025, reporting a sharp y/y increase (+138%), with a net income of 1,922 thousand. The 1Q25 net income included the contribution by Pignus – Crédito Economico Popular (CEP), the Portuguese subsidiary consolidated since November 2024. On 31 March 2025, there were roughly 98 thousand pawn tickets underlying the 153.4 million loans, on the rise both on a quarterly and on a yearly basis, driven among other things by the consolidation of CEP. With regard to the pawn loan business in Italy, 19 auctions of pawned assets were held in the quarter (18 in 1Q24), against a higher number of lots y/y. Total income rose by 49% y/y (8.3 million vs 5.5 million on 31.3.2024), mainly driven by the contribution of pawn loans originated in Italy, as a result of greater loan volumes and higher profitability, higher commissions and CEP’s contribution. The increase in interest income and commission income from pawn loans more than offset the increase in interest expense, not with standing the decline in the cost of funding compared to 4Q24. The 44% increase y/y in net commissions was driven by the higher number of auction lots in Italy with rising gold prices, and the related revenues more than offset the lower revenues for the auction houses. Loan loss provisions declined y/y as a result of the new lending policy (for KK and CEP): besides the new loan classification, new coverage ratios were adopted, in particular in CEP, giving rise to a decrease in LLPs.
The y/y change in Operating costs was basically the result of higher personnel expenses, due also to the consolidation of CEP. Other administrative expenses rose y/y, driven by higher stand-alone costs (which include non-recurring costs) and CEP’s consolidation. The change in the amortization of intangible assets was driven by the share of the premium from the purchase of a pawn loan portfolio, as explained in a previous press release published on 24 January 2025, that was recognized under intangible assets. The Group headcount on 31.3.2025 came in at 147 employees (91 on 31.3.2024), and the y/y increase was mainly attributable to the consolidation of CEP’s staff. Income before taxes increased by more than 100% y/y, driven by the strong growth in revenues, featuring a faster rate compared to cost dynamics.
Total assets, up 5% compared to 31 December 2024, mainly comprised customer loans originated by the pawn loans business (up 6.6% compared to 31.12.2024) and by goodwill, totaling 41.1 million. In 1Q25, the company reclassified loans in accordance with the feedback from the Bank of Italy (see the press release dated 20.12.2024). As a result, on 31.3.2025, 34.2 million were classified as nonperforming loans (0.5 million on 31.12.2024), out of a total loan stock of 153.4 million. Out of 34.2 million worth of nonperforming loans, 29.1 million were past due loans (in actual fact, pawn tickets overdue for more than ,90 days), and 5.1 million were unlikely-to-pay loans (mostly pawn tickets waiting to be auctioned). When a pawn loan is not redeemed, it is recovered by auctioning the good pledged as a security (the procedure and the timing are up to the individual company); hence, the reclassification was not due to an increase in credit risk, which indeed remains very low (in spite of the impact from the first time adoption of the new lending policy, the Cost of Risk on 31.3.2025 came in at about 10bps). Intangible assets reported an increase as a result of the recognition of a large share of the premium generated by the purchase of a pawn loan portfolio in January 2025. Financial liabilities measured at amortized cost included the auction surpluses, up by 18% compared to 31.12.2024. Due to banks included the credit facilities granted by Banca Sistema and by other banks (about 30% of total funding). Shareholders’ Equity on 31.3.2025 totaled 51.4 million, up from 49.5 million on 31.12.2024.
On 31 March 2025, total own funds (Total Capital) on a stand-alone basis came to 20.5 million (the same in terms of CET1). Total Capital Ratio (TCR) went down to 20.5% compared to 31.12.2024 (22%). The quarter-on-quarter decline of TCR was mainly due to the increase in RWAs, which went from 92.0 million on 31.12.2024 to 100.1 million on 31.3.2025, due to the new loan classification. In spite of the increase in RWAs, the TCR remains well above the minimum capital requirement, and also above the estimate as at 31.12.2024 (20%) based on the current loan classification (see press release of 6.2.2025).
