Fast-growing microlender, GetBucks Limited posted a P2.3 million aftertax loss for the year ended June 30, 2019, as a write off of receivables from a sister company cancelled out increases in the loan book and topline revenues.
GetBucks Limited, a subsidiary of Luxembourg-headquartered MyBucks, is amongst the larger microlenders in the aggressively competitive local market dominated by Letshego Holdings.
According to its recently released results, GetBucks’ loan book rose 28% year-on-year to P48.7 million by June 30 last year, while revenues quickened 11% to P42.9 million.
However, the company was forced to write off P4.3 million in outstanding invoice payments from a sister company, VSS Financial Services, pushing it into negative territory.
The write off, combined with increases in salaries, collection costs as well as fines and penalties paid, pushed up GetBucks’ operating expenses to P44.4 million from P28.7 million.
Management said the losses were also due to the implementation of IFRS 9, a new reporting standard where companies are required to state broader “expected credit losses” which widen the impairment provision.
“The board is optimistic that going forward
The directors said going forward, the focus would be on restructuring the balance sheet to reduce the cost of funding and thus better price credit products, operational efficiency and robust governance structures.
“These pillars will aid in significantly improving the group’s profitability and growth in its asset base, while leveraging cutting edge technologies to deliver above-average customer service and competitive pricing and products.
“The business model remains strong and the group is expected to close all leakages from the past and command a significant market share,” the directors said.
GetBucks commenced operations in Botswana in 2012 and as a group, has local subsidiaries that include BU Bucks, CashCorp, TU Employee Benefits, Ochwe Developers and others.