The year 2004 has been very successful for AS Balti Investeeringute Grupp as a consolidation group.
The company\'s goal to be closer to its clients and expand the sales network has proven a success. Since the beginning of 2004 three new branches have been opened: one in Lasnamäe Centrum in Tallinn (January), one in Ülemiste Keskus in Tallinn (April) and one in Narva Centrum (July). Thus, as of the end of 2004 AS Balti Investeeringute Grupp has seven branches throughout Estonia. The launch of new branches has been a success and by the beginning of autumn a considerable loan portfolio has been formed.
The financial results of AS Balti Investeeringute Grupp for the year 2004 were as anticipated. Changes in the company's key economic indicators were comparable with the developments of other companies operating in the financial sector. Both the portfolio of loans issued and the earnings and profit from ordinary activities grew remarkably. The increase in interest expenses and wages and salaries has been relatively lower than the increase in income, and the overall efficiency of the company has improved. The focus on the core activities and active marketing have significantly contributed to the accomplishment of the company's objectives.
The interest income of the consolidation group of AS Balti Investeeringute Grupp was up 54% compared to 2003 and amounted to EEK 64.5 million. At the same time, interest expenses grew by just 14%, amounting to EEK 11.4 million. Both the decline in the general interest level and the increase in the owners\' equity contributed to the relatively small growth in interest expenses.
The Group earned a total of EEK 4.2 million on net fees and commissions, which is up 54% from the previous year.
Administrative expenses grew in the Group by 44% in 2004 when compared to the year 2003, amounting to EEK 29.7 million. An increase in expenses incurred in marketing activities accounted for a significant part in the growth.
The aggregate net profit of the Group grew in 2004 by 52% when compared to the previous year, and amounted to EEK 31.6 million.
In 2004 the Group issued a total of EEK 236 million in loans, which is 52% more than in 2003. As of 31 December 2004 the Group\'s net loan portfolio amounted to EEK 228.2 million and the assets to EEK 269.9 million, exceeding the figures shown at the end of 2003 by 42.5% and 45.9%, respectively.
The total uncollectible accounts (provisioned) have risen to EEK 8.2 million, i.e. by 17% and account for 3.5% of the portfolio as of 31 December 2004. The actual loss ratio of loans continued to be lower than the provision ratio and no material increase of the loss ratio is expected to occur.
The liabilities of the Group grew in the year 2004 to 192 million kroons, i.e. by 41% when compared to the beginning of the financial year. Among other liabilities, the amount of issued bonds has increased notably, amounting to EEK 123 million as of the end of 2004 (a growth of 77%).
The owners\' equity of the Group increased to EEK 78 million during the year 2004, i.e. up 61% when compared to the beginning of the year.
The company\'s objectives for 2005: to continue expanding the sales network and making the service more easily available to clients and to set up a long-term financial base for the company, which would ensure stable financing during the company\'s continuing growth phase. For the purpose of providing the company with a long-term financing base the company applied for a credit institution activity license at the end of 2004.
The balance sheet and income statement are available here.
Eero Varkki
Chief Financial Officer
737 7599
