Key Performance Indicators

We use Key Performance Indicators (KPIs) to measure our performance against our strategy. The KPIs marked have been externally assured by PricewaterhouseCoopers (PwC) in accordance with the International Standard on Assurance Engagements (ISAE 3000). Management’s basis of reporting. Also see the Independent assurance report. We believe that non-financial performance is as important as financial performance in assessing the growth prospects of our company. For that reason we aim to continually improve how we report on non-financial performance and selected non-financial data has been externally assured against the International Standard on Assurance Engagements since 2009. Information on how we manage non-financial performance can be found on the sustainability section as well as information on the various socially responsible investment indicies we participate in.

Analysts, fund managers or research bodies wishing to receive more information should contact the Investor Relations Manager at investors@ipfin.co.uk

Customers

Customer numbers

The total number of customers across the Group. At the end of 2011 we had 2.4 million customers, an increase of 8.8% on 2010.

Strategic link

  • Customer numbers demonstrate our scale and reach in our individual markets. Growth in our customer base is critically important. However, we will reject potential new customers and not seek to retain customers who contravene our credit policies or have a poor repayment record.

Credit issued per customer

Credit issued per customer

The value of money loaned to customers normally measured over the previous 12 months. In 2011, credit issued per customer was £366, an increase of 3.1% on 2010 at constant exchange rates.

Strategic link

  • The main driver of profit per customer is the amount of credit issued per customer.
  • Credit issued per customer should increase over time and is driven partly by good repayment behaviour. We adopt a ‘low and grow’ strategy and only issue more credit to a customer once their credit worthiness is proven.

Prior year figures are restated at constant exchange rates.

Net customer receivables

Net customer receivables

The amount outstanding from customers for loans issued less impairment provisions calculated in accordance with our IFRS compliant accounting policies. At the end of 2011 net customer receivables were £560.4 million, up 10.3% on 2010 at constant exchange rates.

Strategic link

  • The revenues we earn are calculated by reference to the effective interest rates of the loans we issue and the value of the net customer receivables outstanding.

Prior year figures are restated at constant exchange rates.

Revenue

Financial revenue

Income generated from customer receivables. In 2011 revenue was £649.5 million, an increase of 7.4% on 2010.

Strategic link

  • Most of the business costs are relatively fixed.
  • As revenues increase in line with customer numbers and receivables, developing markets move into profitability and profits and margins grow rapidly.

Prior year figures are restated at constant exchange rates.

Impairment

Impairment

The amount charged as a cost to the income statement as a result of customers defaulting on contractual loan agreements stated as a percentage of revenue – we account prudently and thus a default is classified as the failure to make any weekly payment in full. The cost includes the value of repayments written off as irrecoverable as well as provisions for expected future defaults. In 2011 impairment reduced from 27.6% to 25.8% of revenue.

Strategic link

  • Profitability is maximised by optimising the balance between growth and credit quality.
  • Impairment as a percentage of revenue is a good measure for comparing performance across markets.

Gross cash loss (‘GCL’)

Gross cash loss ('GCL')

The expected total value of contractual customer repayments that will not be collected and will ultimately be written off for any loan or group of loans. Until collections for any cohort are complete, the GCL is a composite of actual and forecast cash collections.

Strategic link

  • A leading-edge measure of the quality of credit issued. Forecasts are based on the actual performance of previous lending.
  • The higher the expected GCL, the higher the impairment charge will be in the periods after the loans are issued.

Direct expenses as % of revenue

Direct expenses as % of revenue

The direct expenses of running the business excluding agents’ commission. Expressing expenses as a percentage of revenue is useful for comparing performance across markets. The cost: income ratio increased slightly to 40.9% due to the impact that higher rebates had on reported revenue.

Strategic link

  • The lower our expenses to revenue ratio, the more efficient we are and the more profit we make.

Share Price

IR Calendar

  • 24 May 2012

    Annual General Meeting

  • 01 Jun 2012

    2011 Final dividend payment

  • 24 Jul 2012

    2012 Interim results announcement

  • 05 Oct 2012

    2012 Interim dividend payment

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