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현대카드 Ir 자료 (2013) en 현대카드 Ir 자료 (2013) en Presentation Transcript

  • Hyundai Card is... Investor Presentation Hyundai Card 2013
  • Disclaimer These presentation materials have been prepared by Hyundai Card Co., Ltd. (“HCC or the Company”), solely for the use at this presentation and have not been independently verified. No representations or warranties, express or implied, are made as to, and no reliance should be placed on, the accuracy, fairness or completeness of the information presented or contained in this presentation. Neither the Company nor any of its affiliates, advisers or representatives accepts any responsibility whatsoever for any loss or damage arising from any information presented or contained in this presentation. The information presented or contained in this presentation is current as of the date hereof and is subject to change without notice and its accuracy is not guaranteed. Neither the Company nor any of its affiliates, advisers or representatives make any undertaking to update any such information subsequent to the date hereof. This presentation should not be construed as legal, tax, investment or other advice. Certain information and statements made in this presentation contain “forward-looking statements.” Such forward-looking statements can be identified by the use of forward-looking terminology such as “anticipate,” “believe,” “considering,” “depends,” “estimate,” “expect,” “intend,” “plan,” “planning,” “planned,” “project,” “trend,” and similar expressions. All forward-looking statements are the Company’s current expectation of future events and are subject to a number of factors that could cause actual results to differ materially from those described in the forward-looking statements. Caution should be taken with respect to such statements and you should not place undue reliance on any such forward-looking statements. Certain industry and market data in this presentation was obtained from various trade associations, and the Company’s have not verified such data with independent sources. Accordingly, the Company’s make no representations as to the accuracy or completeness of that data, and such data involves risks and uncertainties and is subject to change based on various factors. This presentation does not constitute an offer or invitation to purchase or subscribe for any shares or other securities of the Company’s and neither any part of this presentation nor any information or statement contained therein shall form the basis of or be relied upon in connection with any contract or commitment whatsoever. Any decision to purchase shares in any offering of shares of the Company’s should be made solely on the basis of the information contained in the offering document which may be published or distributed in due course in connection with any offering of shares of the Company’s, if any. The contents of this presentation may not be reproduced, redistributed or passed on, directly or indirectly, to any other person or published, in whole or in part, for any purpose.
  • Key Highlights 2013 1 • Stable profitability : Operating profit of KRW 220 billion and ROA of 1.7% • Effective marketing : Highest average monthly spending (KRW 800k/month) among peers as a result of unique marketing efforts • Excellent asset quality : 0.8% delinquency rate (30 days +) • Sound capital structure : Leverage of 4.9x and a capital adequacy ratio of 19.4% • Strong liquidity : Short term debt coverage ratio of 87.5% • Chapter 2, turn the page : Simplified brand portfolio, M and X card
  • Shareholder Financial & Operational Support 2 Relationship with Shareholders - Innovative “Point Programs” 2013 - Total Investment to date : U$650mm (As of 2013 end) 2010 - Stable & solid operational base 54.0% GE Capital’s Financial Support - GE Capital provides U$200mm back-up credit-line 2008 - 2006 ~ 2008 Exercising of Warrants (Additional equity investment) 2006 - GE Capital increases paid in capital by KRW 165bn 2005 - Establishment of joint venture with GE Capital - Extensive sales network - Powerful financing arm - Effective marketing tool - Most successful joint venture - Sole consumer finance window in Korea 43.3% - Advanced knowledge of risk management - Financial support - Active involvement in management and daily operations - GE Capital purchases KRW 200bn subordinated bond - GE Capital acquires KRW 313bn equity interest in HCC
  • Resilient GDP Growth and Increasing Credit Card Usage 3 GDP Growth Rate & Unemployment Rate 2010 2011 2012 2013 GDP Growth Rate 6.1% 3.6% 2.0% 2.8% Unemployment (yr.) 3.7% 3.4% 3.2% 3.1% Key Highlights GDP growth remains near 2% for two consecutive years - Slow recovery, albeit government expenditure increase Volume growth stagnant - Matured market and regulation leads to stagnant Source: Bank of Korea market growth Credit Card Spending* & Usage Rate Credit Card Spending (KRW Tn) 56.8% 350.7 59.6% 390.2 Credit card spending/Total private consumption 66.3% 451.2 61.0% 405.0 Continuous GDP growth backed by the strong government stimulation - Monitor the impact of weak JPY and household debt Countermeasure against regulation on credit card companies 2010 2011 2012 * Excludes cash advance and corporate purchase cards Source: Credit Finance Association 3Q13 - Minimize the impact via enhanced products and channels
  • Balanced-risk Asset Portfolio and Consistent Market Share 4 Receivables Breakdown by Product Key Highlights and Strategy Others 0.6% Balance between profitability and stability by maintaining credit purchase account over 60% Card Loan 26.6% Lump Sum 42.8% Marginal M/S decrease, as refrained from volume Cash Advance 8.5% growth • Total Financial Receivables : KRW 9.9 Tn Installments 21.5% • % credit purchase : 64.3% - Reduce benefits for Cherry Picking customers - Increase benefits for Loyal customers Market Share Credit Purchase* Market Total Credit Card Market (credit purchase*+ financial products) 15.7% 15.5% 15.5% 14.9% Qualitative growth based on loyal customers - Reform product service/card plates to simplify and reinforce card portfolio 14.1% 14.3% 14.5% 2010 2011 2012 13.9% Increase finance volume without deteriorating asset quality * Excludes corporate accounts Source: FISIS 9M13
  • Good Profitability, albeit Slow Economy 5 Income Statement (KRW Bn) Key Highlights and Strategy 2010 2011 2012 2013 YoY 2,260 2,370 2,460 2,503 1.8% Operating Expenses* 1,890 2,045 2,223 2,283 2.7% Operating Revenue* Bad debt expense 185 200 203 248 22.1% Operating income 371 323 237 220 -7.3% Net Income 278 239 194 163 -16.0% * Excluding FX effect Weaker operating revenue growth - Decrease in card income : MDR regulation impacts etc. - Increase in income from financial products : Card loans and revolving loans Increase in operating expenses - Increase in bad debt expenses due to the unfavorable economic conditions and regulations - Transform to efficient cost structure with service reduction ROA ROA 3.5% 2.6% 2010 2011 2.0% 2012 Reinforce profitability to set base for a turnaround 1.7% 2013 - Diversify product portfolio - Optimize the cost structure through reducing point expenses, etc.
  • Excellent Asset Quality and Conservative Reserve Policy 6 30+ Day Delinquency Rate (%) Key Highlights and Strategy Delinquency edged up, but stable since 1Q13 0.6% 0.4% 0.8% 0.7% - Impact from macro: slow economy and higher household debt - Delinquency rate maintained with conservative underwriting policy 2010 2011 2012 2013 Total reserve increased (over 100% vs. FSS regulatory requirement) Total Reserve (KRW Bn) 2010 2011 2012 2013 189 378 544 594 Regulatory coverage** 128% 199% 157% 144% Maintain tightened underwriting process and % of Asset 2.1% 4.0% 5.5% 5.7% employ more efficient collection strategy to enhance Total Reserve* * Reserve under accounting principles + supplemental reserve ** Total Reserve/ Regulatory Requirement asset quality
  • Leverage and Capital Adequacy Soundly Managed 7 Leverage Trend (KRW Bn) Total Equity Total Asset / total Shareholder’s Equity Leverage Regulation < 6X 6.0x 1,737 2010 Key Highlights and Strategy 5.4x 2,008 2011 5.1x 4.9x 2,367 2,197 2012 2013 Capital Adequacy Ratio Maintain dividend payout policy within 6.0X 2010 Capital Adequacy Ratio * FSS guideline: 8.0% Earnings retained for conservative leverage 2011 2012 2013 18.7% 19.6% 18.7% 19.4% in line with FSS guideline
  • Well Diversified, Stable Funding Portfolio 8 Funding Portfolio by Product Key Highlights and Strategy Strategic Funding based on market condition ABS 10.3% Loans 2.9% - Exploit tightening spread in longer tenor - Bond proportion increased to accommodate low interest environment Bonds 86.7% • Balance : KRW 7.2 Tn Establish funding portfolio with • Long term : 74.0% ABS under 20%, CP under 10%
  • Strong Liquidity Position and Well-Spread Debt Maturity 9 Liquidity Profile (Unit: KRW Bn) Cash Credit Line 79.0% 36.7% 1,584 Key Highlights and Strategy Short-term Debt Coverage Ratio* 87.5% 65.5% More Cash for Liquidity Reinforcement 1,646 1,514 1,148 ALM based funding: only 26% matures in 1st year 866 841 824 650 743 690 780 2010 2011 2012 2013 498 * Short-term Debt Coverage Ratio = (Cash + Unused committed credit line)/ Short-term debt balance Liabilities (Debt) (Unit: KRW Bn) Keep duration of liability > asset : ALM over140% 26.7% 20.0% 15.3% 10.6% 1,111 1H14 14.7% 1,933 1,450 770 2H14 2015 2016 Maintain short-term debt coverage ratio over 60% 12.6% 1,068 911 2017 2018~
  • Appendix
  • The Premier Korean Credit Card Company 10 • Strongest brand power in industry • Strong asset quality and high brand loyalty - Excellent asset quality with the industry’s lowest delinquency rate of only 0.8% - Highest monthly average spending in industry per customer : KRW 800k • Marketing innovations differentiate brand and drive growth - Strategic marketing program with Hyundai Motor Group - Leadership position in super premium segment • Successful partnership between Hyundai Motor Group and GE Capital - Strong governance with GE Capital's active involvement in management & daily operations - Joint promotions with Hyundai Motor Group • Strong credit profile based on robust fundamentals - International : Fitch (BBB) / S&P (BBB) - Domestic : AA+
  • Committed to Transparent Corporate Governance 11 Board of Directors • HMC 5 : GECC 4 : Outside directors 3 • GECC has veto rights Risk Control Committee Executive Finance Committee Compliance Review Board • Member : 5 from HMC, 5 from GECC • Member : 4 from HMC, 3 from GECC • Member : 9 from HMC, 7 from GECC • Frequency : Monthly • Frequency : Monthly • Frequency : Quarterly • Function • Function • Function -Determination of risk indicator levels and appropriate course of actions in respect thereof GE Presence -Approval of various operating expenses, Capex, business and funding plans -Formulation and execution of compliance strategy, schemes, and improvements • C-Suite executives: Vice President, Deputy CFO, Deputy CRO, Deputy CMO, Controller • Working level : GE employees also involved in day-to-day operations • Transfer of advanced knowledge in various functions through best practice sharing program
  • Product Overview & Market Share 12 Market Share Trend Business Area Features Credit Purchase* Market* Total Credit Card Market (credit purchase*+ financial products) Lump sum • Single-payment purchases • Repaid on a monthly billing cycle Credit Purchase 15.7% 15.7% 15.5% 15.5% Installment 13.8% • Multiple-payment purchases • Payment period of 2-12 months 14.9% 12.8% 14.5% 14.1% 14.3% 13.9% 11.8% 13.1% 11.2% Card loan • Unsecured loans to cardholders • 3 – 36 month maturity 10.1% 8.8% Financial Products Cash advance • Cash withdrawal • Lump sum or installment payback 2006 2007 2008 * Excludes corporate accounts Source: FISIS 2009 2010 2011 2012 3Q13
  • One of Korea’s Most Well Recognized & Respected Brands 13 Strong Brand Drives Higher Customer Loyalty Innovative Branding Activities Strategy: Innovative Experience - Design Library - Super event series Emotional Communication Classic - Various culture projects Dynamic • Design library, specializing • Super concert in design related publications - My Taxi Result: - Well respected, trendsetting image with high customer awareness* - Higher customer loyalty & spending, evidenced through average card usage per customer *88.1% (Source: TNS RI Research 2011) • Unique culture projects of Hyundai card • My Taxi, concept car, in collaboration with KMC
  • Chapter 2 : For the Next New 10 years 14 Two Track Brand Portfolio Point Two Key Benefit • Simple Card Product - Simplified Product portfolio - Concentrate on saving Point • Service Differentiation - Selecting card product by usage amount (M1~M3) Cash Back • Discount through cash-back system - Cash-back from every merchandise • Service Differentiation - Selecting card product by usage amount (X1~X2)
  • Key Indicators 15 (Unit : KRW Bn, %) 2013 Credit Purchase 11.8% 12.8% 13.8% 15.7% 15.7% 15.5% 15.5% 14.5% Total Market 8.8% 10.1% 11.2% 13.1% 14.1% 14.3% 14.5% 13.8% 3,508 4,507 5,616 7,136 9,186 9,563 9,898 9,947 Credit Purchase 77.6% 74.1% 72.9% 74.3% 65.7% 68.1% 66.7% 64.3% Financial 19.8% 25.8% 27.1% 25.7% 34.3% 31.7% 32.9% 35.1% 2.6% 0.1% 0.0% 0.0% 0.1% 0.2% 0.4% 0.6% Operating Income 111 73 258 286 371 324 237 220 2.2% 0.4% 0.7% 0.3% 0.4% 0.6% 0.7% 0.8% Allowance for Loan Loss 158 104 135 142 189 174 181 205 158 104 135 142 189 378 544 594 Capital Adequacy Ratio 31.3% 28.4% 23.6% 22.5% 18.7% 19.6% 18.7% 19.4% 4.1X 4.1X 4.6X 4.9X 6.0X 5.4X 5.1X 4.9X 2,199 2,933 3,980 5,165 7,197 7,068 7,073 7,243 Bond 68.5% 66.8% 64.6% 72.8% 73.6% 85.3% 80.4% 86.7% Bank Loans 6.3% 4.7% 3.0% 2.0% 10.1% 1.4% 1.0% 2.9% CP 9.3% 14.8% 14.1% 11.0% 9.1% 6.9% 4.9% - ABS 15.9% 13.6% 18.3% 14.1% 7.2% 6.3% 12.7% 10.3% Cash 143 149 360 391 650 743 690 780 Credit Line - 150 120 20 498 841 824 866 S-T Debt coverage Liquidity 2012 Total Funding Portfolio 2011 Asset Leverage Capital Adequacy 2010 Total Reserve** Asset Quality 2009 30+ Delinquency Profit 2008 Others Asset Portfolio 2007 Total Market Share 2006 13.1% 27.3% 32.7% 18.6% 36.7% 79.0% 65.5% 87.5% * Including supplemental reserve
  • Good Profitability, albeit Slow Economy 16 Income Statement (KRW Bn) K-GAAP K-IFRS 2008 2009 2010 2011 2012 2013 YoY Operating Revenues 1,594 1,841 2,337 2,408 2,526 2,528 0.1% (excl. FX effect) 1,444 1,795 2,260 2,370 2,460 2,503 1.8% Operating Expenses 1,337 1,555 1,966 2,084 2,292 2,308 0.7% (excl. FX effect) 1,186 1,509 1,890 2,045 2,223 2,283 2.5% Card expenses 506 730 863 924 1,044 1,028 -1.5% Interest expenses 187 221 319 357 343 313 -8.9% SG&A Expenses 367 398 484 538 606 637 5.0% 357 441 570 525 440 469 6.5% Bad Debt expenses 103 113 185 200 203 248 22.0% Provision for unused Credit Line -3 42 14 1 0 1 - Operating Income 258 286 371 324 237 220 -7.3% Income before Tax 272 295 371 324 236 219 -7.4% Net Income 202 213 278 239 194 163 -16.0% ROA 3.9% 3.5% 3.5% 2.6% 2.0% 1.7% ROE 16.7% 15.1% 17.6% 12.6% 9.2% 7.1% PPOP
  • Korean Credit Card Market Features 17 • Conservative lending environment - Low usage of revolving credit card products, as full payment of monthly balance preferred • Strong credit infrastructure - Well developed credit bureau system to check credit based transactions - Credit card company’s own credit scoring system for further credit assessment • Cash-less society - Credit card available for the payment in all private sectors, thus accounts 61% of all private sector expense • Strict government oversight - Regulations governing new origination practices and customer cash advance limits
  • Korea Credit Card Industry: Then & Now 18 Combined Asset portfolio Credit Purchase Total Asset Quality (30+ Day Delinquency Rate) Financial Products 34.8% 64.9% 28.3% 65.2% 35.1% 2003 2.0% 3Q13 Capital Adequacy Ratio 2003 3Q13 Regulatory & Infrastructure Changes: - Credit bureau system established 27.9% - Companies must maintain capital adequacy ratio of above 8% -5.5% 2003 Source: FSS - Reinforced standard on new credit card issuance 3Q13
  • Investor Relations Contacts Jungsang Kim, Head of Investor Relations Phone +82 2 2167 7034 jungsang.kim@hyundaicard.com Suh ye Choi, Manager of Investor Relations Phone +82 2 2167 7541 sychoi@hyundaicard.com Justin Lee, Manager of Investor Relations Phone +82 2 2167 8082 justin.j.lee@hyundaicard.com Jay Moon, Assistant Manager of Investor Relations Phone +82 2 2167 5312 jaymoon@hyundaicapital.com Hyunyoung Jang, Assistant Manager of Investor Relations Phone +82 2 2167 6955 hyunyoung.jang@hyundaicard.com http://ir.hyundaicard.com/