Key figures

KEY FINANCIAL AND PERFORMANCE INDICATORS OF THE GROUP

Based on data from audited financial statements for the respective years

	2021	2020	2019
Key financial data
Net interest income (EUR ’000)	16 717	14 572	11 569
Operating profit (EUR ’000)	13 829	5 539	8 131
Profit for the period (EUR ’000)	13 829	5 539	8 131
Cos to income ratio (CIR)	39.46%	47.51%	52.58%
Employees	226	211	203
Total assets (EUR ’000)	976 204	850 704	560 061
Financial debt (EUR ’000)	360 909	342 490	217 943
Tangible common equity (TCE) / Total tangible managed assets (TMA) *	33.82%	33.56%	29.40%
Equity and reserves (EUR ’000)	440 736	382 594	232 738
Total risk coverage: (EUR ’000)	285 954	180 205	87 456
Risk coverage reserve	159 196	112 567	99 778
Risk coverage reserve used for provisions	(29 496)	(28 197)	(27 829)
Portfolio loss reserve (specific reserve capital)	159 700	102 264	15 507
Portfolio loss reserve used to compensate provisions in the distribution of annual profit	(3 446)	(6 429)	-
Liquidity ratio for 180 days **	518%	464%	582%
Net Cash flows from operating activities (EUR ’000)	49 555	21 966	39 813
Net Cash flows from financing activities (EUR ’000)	43 768	165 800	18 700
Net Cash flow from investing activities (EUR ’000)	4 553	(4 016)	(11 230)
Support instruments gross value (EUR ’000), of which	979 130	872 302	667 649
Financial instruments gross value (EUR ’000) ***
Loans (excluding sales and leaseback transactions)	315 674	302 481	225 144
Guarantees	414 978	359 605	284 232
Venture capital funds	85 973	73 165	68 331
Land Fund, of which:	79 163	68 258	39 634
- sales and leaseback transactions	32 999	31 500	15 268
- investment properties	46 164	36 758	24 366
Total	895 788	803 509	617 341
Number of transactions	30 978	26 578	22 437
Volumes issued (EUR ’000) (by financial instrument) ***
Loans (excluding sales and leaseback transactions)	100 966	138 238	64 320
Guarantees	126 997	137 425	98 240
Venture capital funds	29 158	14 014	9 022
Land Fund, of which:	10 595	28 191	16 384
- sales and leaseback transactions	3 254	16 796	7 239
- investment properties	7 341	11 395	9 145
Total	267 716	317 868	187 966
Number of transactions	6 579	6 147	5 559
Total contribution to economy, including the participation of the final recipients (EUR ’000)	791 646	696 306	531 661
Leverage for raised private funding	177%	114%	142%
Volume of support programmes funding per employee (EUR ’000)	3 964	3 808	3 041
Long-term rating assigned by Moody’s Investors Service	Baa1	Baa1	Baa1

* TMA includes off-balance sheet item outstanding guarantees.

** The calculation of liquidity ratio takes into account the previous experience and management estimate of the expected amount and timing of guarantee claims

*** Taking into account the significance of the volume, the Land Fund portfolio, which consists of leaseback transactions and investment properties, is also presented in the operational volumes for the period. As in compliance with the accounting principles and IFRS the leaseback transactions are accounted for under the loans, the loan volume in this table has been reduced for the volume of the leaseback transactions as it is recorded under the Land Fund portfolio.

KEY FINANCIAL AND PERFORMANCE INDICATORS

Based on data from audited financial statements for the respective years

	2021	2020	2019	2018	2017 (corrected) *	2016 (corrected) *
Key financial data
Net interest income (EUR ’000)	16 717	14 572	11 569	11 302 **	11 602	11 024
Operating profit (EUR ’000)	13 829	5 539	8 131	4 092	8 709	2 170
Profit for the period (EUR ’000)	13 829	5 539	8 131	4 092	8 709 *	2 170
Cos to income ratio (CIR)	39.46%	47.51%	52.58%	74.84% ***	50.30% *	88.40%
Employees	226	211	203	222	230	242
Total assets (EUR ’000)	976 204	850 704	560 061	495 939	453 668 *	443 400 *
Financial debt (EUR ’000)	360 909	342 490	217 943	177 249	146 157	141 854
Tangible common equity (TCE) / Total tangible managed assets (TMA) ****	33.82%	33.56%	29.40%	31.70%	35.10% *	36.50%
Equity and reserves (EUR ’000)	440 736	382 594	232 738	221 590	222 848 *	210 406 *
Total risk coverage: (EUR ’000)	285 954	180 205	87 456	77 815	67 593 *	66 508 *
Risk coverage reserve	159 196	112 567	99 778	85 276	62 651	63 636 *
Risk coverage reserve used for provisions	(29 496)	(28 197)	(27 829)	(19 268)	(4 753)	(4 323)
Portfolio loss reserve (specific reserve capital)	159 700	102 264	15 507	11 807	9 695	7 195
Portfolio loss reserve used to compensate provisions upon approval of the annual report	(3 446)	(6 429)	-	-	-	-
Liquidity ratio for 180 days *****	518%	464%	582%	227%	482% *	449%
Net Cash flows from operating activities (EUR ’000)	49 555	21 966	39 813	7 997	(10 146)	34 518
Net Cash flows from financing activities (EUR ’000)	43 768	165 800	18 700	12 013	22 299	5 560
Net Cash flow from investing activities (EUR ’000)	4 553	(4 016)	(11 230)	8 307	3 891	759
Support instruments gross value (EUR ’000), of which	979 130	872 302	667 649	553 628	465 724
Financial instruments gross value (EUR ’000) ***
Loans (excluding sales and leaseback transactions)	315 674	302 481	225 144	210 208	207 065	217 429
Guarantees	414 978	359 605	284 232	236 895	182 376	147 175
Venture capital funds	85 973	73 165	68 331	59 698	62 299	64 785
Land Fund, of which:	79 163	68 258	39 634	21 717	11 328	4 635
- sales and leaseback transactions	32 999	31 500	15 268	6 923	520	-
- investment properties	46 164	36 758	24 366	14 794	10 808	4 635
Total	895 788	803 509	617 341	528 518	463 068	434 024
Number of transactions	30 978	26 578	22 437	18 603	14 655	11 561
Volumes issued (EUR ’000) (by financial instrument) ******
Loans (excluding sales and leaseback transactions)	100 966	138 238	64 320	59 608	51 349	59 465
Guarantees	126 997	137 425	98 240	88 765	68 615	56 109
Venture capital funds	29 158	14 014	9 022	4 149	2 638	21 356
Land Fund, of which	10 595	28 191	16 384	10 823	6 359	3 704
- sales and leaseback transactions	3 254	16 796	7 239	6 835	520	-
- investment properties	7 341	11 395	9 145	3 988	5 839	3 704
Total	267 716	317 868	187 966	163 345	128 961	140 634
Number of transactions	6 579	6 147	5 559	5 590	4 839	4 537
Total contribution to the economy, including the contribution of the final recipients (EUR ‘000)	791 646	696 306	531 661	460 045	370 560	359 706
Leverage for raised private funding	177%	114%	142%	162%	185%	162%
Volume of support programmes funding per employee (EUR ’000)	3 964	3 808	3 041	2 381	2 013	1 793
Long-term rating assigned by Moody’s Investors Service	Baa1	Baa1	Baa1	Baa1	Baa1	-

* Due to change of accounting policy on investments in venture capital funds and adoption of IFRS 9 requirements that effects the accounting of public funding risk coverage the comparatives for 2017 and 2016 have been restated.

** Due to reclassification of fees and commission related to lending activities following the industry practise, excludes fees and commission not related to lending activities, the comparatives for 2018 have been reclassified with subsequent ratio recalculation.

*** Due to reclassification of staff and administrative costs to be compensated as well as respective income on compensation, the comparatives for 2018 have been reclassified with subsequent ratio recalculation.

**** TMA includes off-balance sheet item outstanding guarantees.

***** Liquidity ratio calculation takes into account the previous experience and management estimate of expected amount and timing of guarantees claims

****** Taking into account the significance of the volume, the Land Fund portfolio, which consists of sales and leaseback transactions and investment properties, is also presented in the outstanding volumes and in volumes issued in the period. Since according to the accounting principles and IFRS the sales and leaseback transactions are accounted for under the loans, the volume of loans presented in this table has been reduced for the volume of the sales and leaseback transactions as it is recorded under the Land Fund portfolio.

DEFINITIONS OF RATIOS

Net income from interest

“Net income from interest, fees and commission” is equal to the item “Net interest income” in the Statement of Comprehensive Income. Until 2018 this ratio included the following items of the Statement of Comprehensive Income: “Net interest income” and “Net income from fees and commissions”. In 2019 following the industry practise Fee and commission income from lending activities is reclassified to Interest income from “Net income from fees and commissions”. Subsequently the fee and commission income not related to lending activities is reclassified within Other income and as such is not included in this ratio. The item “Net income from fees and commissions” is not applicable in The Statement of Comprehensive Income anymore. The comparatives have been reclassified accordingly. ALTUM uses this indicator as the key financial metric for profitability by evaluating ALTUM Group’s net income amount generated by the portfolio of financial instruments and recognised in the Statement of Comprehensive income. ALTUM management measures and monitors the actual performance of this indicator on a quarterly basis compared to the approved level in ALTUM Group’s budget.

Operating profit

“Operating profit” is calculated by deducting “Operating expenses” from “Operating income before operating expenses” included in the Statement of Comprehensive Income. “Operating expenses” is calculated as the sum of “Staff costs”, “Administrative expense”, “Amortisation of intangible assets and depreciation of property, plant and equipment” and “Impairment gain / (loss), net” included in the Statement of Comprehensive Income.

Cost to income ratio (CIR)

“Cost to income ratio” (CIR) is calculated by dividing the amount of “Staff costs”, “Administrative expense”, “Amortisation of intangible assets and depreciation of property, plant and equipment” by “Operating income before operating expenses” included in the Statement of Comprehensive Income. ALTUM uses CIR to evaluate the operational efficiency. This is one of the measures of operational efficiency which ALTUM management assesses on a quarterly basis in the management reports to evaluate the outputs from different operational activities and efficiency improving measures.

Financial debt

“Financial debt” is calculated as the sum of “Due to credit institutions”, “Due to general government entities”, “Financial liabilities at amortised cost – issued debt securities” and “Support programme funding” included in the Statement of Financial Position less difference between “Risk Coverage Reserve” and “Risk Coverage Reserve Used for Provisions”.

“Risk Coverage Reserve” is disclosed in the Note on Support Programme Funding to the Financial statements of ALTUM Group. “Risk Coverage Reserve Used for Provisions” is the amount of “Risk Coverage Reserve” allocated to and used for provisioning for impairment loss on loan portfolio and guarantees which in its turn is disclosed in the Note on Support Programme Funding to the Financial statements of ALTUM Group.

Tangible common equity (TCE) / Tangible managed assets (TMA)

“Tangible Common Equity” (TCE) is calculated by subtracting the revaluation reserve of available for sale investments from total equity.

The amount of “Total managed assets” (TMA) is calculated by adding the guarantees shown as off-balance sheet items to the total assets of ALTUM Group taking into account provisions for these guarantees and subtracting “Deferred expense”, “Accrued income”, “Property, plant and equipment”, “Intangible assets”, “Other assets” and “Assets held for sale”.

Data for the calculation of both indicators (TCE, TMA) are obtained from ALTUM Group’s Financial statements: Statement of Financial Position and Consolidated Statement of Changes in Equity, notes - Off balance sheet items and contingent liabilities and Provisions. ALTUM uses the ratio “TCE/TMA” to evaluate ALTUM Group’s capital position adequacy and to measure ALTUM Group’s tangible common equity in terms of ALTUM Group’s tangible managed assets including the off-balance sheet item Guarantee portfolio. The Risk and Liquidity Management Committee of ALTUM monitors its level on a quarterly basis.

Total risk coverage

“Total Risk Coverage” is the net funding available for covering the expected credit losses of the State aid programmes implemented by ALTUM. “Total Risk Coverage” is calculated as the total of “Risk Coverage Reserve” and “Portfolio Loss Reserve” (Specific Capital Reserves) less “Risk Coverage Reserve Used for Provisions” and “Portfolio loss reserve used to compensate provisions upon approval of the annual report”. The expected losses are estimated before implementation of the respective State aid programme and part of the public funding received under respective State aid programme for coverage of expected losses on credit risk is transferred either to “Portfolio Loss Reserve” as ALTUM Group’s specific capital reserve or accounted separately as provisions for risk coverage under liabilities item “Risk Coverage Reserve”. “Portfolio Loss Reserve” (specific capital reserve) is disclosed in the Note on Reserves to the Financial statements of the ALTUM Group. “Risk Coverage Reserve” is disclosed in the Note on Support Programme Funding to the Financial statements of ALTUM Group. “Risk Coverage Reserve Used for Provisions” is the amount of “Risk Coverage Reserve” allocated to and used for provisioning for impairment loss on loan portfolio and guarantees which in its turn is disclosed in the Note on Support Programme Funding to the Financial statements of ALTUM Group. “Portfolio loss reserve used to compensate provisions upon approval of the annual report” is disclosed in the Note on Reserves to the Financial statements of the ALTUM Group.

“Total Risk Coverage” is key indicator to be used for assessment of ALTUM’s risk coverage on implemented programmes and long-term financial stability.

180-day liquidity ratio

“180-days-liquidity ratio” is calculated by dividing the amount of the balances “Due from other credit institutions and the Treasury” with a maturity of up to 1 month and “Financial assets at fair value through other comprehensive income and Investment securities” by the amount of the total liabilities maturing within 6 months and total financial commitments maturing within 6 months (off-balance sheet items). The data required for the calculation of the “180-days liquidity ratio” is disclosed in the following ALTUM Group’s Financial statements: Statement of Financial Position and notes – Maturity profile of assets and liabilities under the section of Risk Management, Off-balance sheet items and contingent liabilities. ALTUM uses the “180-days-liquidity ratio” to assess and monitor ALTUM Group’s ability to fulfil ALTUM Group’s contractual and/or contingent liabilities during 6 (six) month with the currently available liquidity resources. “180-days-liquidity ratio” helps to manage ALTUM Group’s liquidity risk in line with ALTUM Group’s/ALTUM’s funding management objectives and risk framework. Risk and Liquidity Management Committee of ALTUM monitors its level on a quarterly basis.

Support instruments gross value

“Support instruments gross value” is calculated as the sum of the gross values of the portfolios of grants, loans, guarantees, venture capital funds and Land Fund

Total contribution to the economy, including the participation of the final recipients, by volumes issued in the period

The 'Total contribution to the economy, including the participation of the final recipients, by volumes issued in the period’ is calculated by adding to the volumes issued by ALTUM the financing provided by the private co-financier and the project promoter.

Leverage for raised private funding

“Leverage for raised private funding” indicates the amount of additional private funds invested in a project in addition to ALTUM’s financing. “Leverage for raised private funding” is determined considering the financing invested by a private co-financier and a project’s implementer, which, on average, makes up to 50 per cent for loans, up to 70 per cent for guarantees and venture capital (except for housing loan guarantees’ programme for the first instalment with a ratio of 795 per cent) in addition to ALTUM’s funding.

Employees

Average number of employees in the report period excluding members of the Council and the Audit Committee.

Volume of support programmes funding per employee

"Support programmes funding per employee" is calculated by dividing the gross value of the Financial Instruments Portfolio by the average number of employees during the period, excluding members of the Supervisory Council and the Audit Committee.

Venture capital

The Venture Capital Funds presented at their gross value.

Contacts for Investor relations

Laura Lapkovska
laura.lapkovska@altum.lv
26165699