2021
Annual Report
Axactor at a glance 4
Our presence 5
Entering an era of value generation 6
Our values 7
Our purpose and vision 8
Highlights of the year 9
Key ıgures 11
Letter from the CEO 12
Report of the Board of Directors 14
Responsibility statement 24
Sustainability report 25
GRI Index 46
Corporate governance report 48
Board of Directors 55
Executive management 57
Shareholder information 61
Financials statements of Axactor Group and Parent Company 63
Summary of notes to the consolidated ınancial statements 70
Summary of notes to the parent company 119
Alternative Performance Measures 140
Content
Gross revenue
0
50
100
150
200
250
300
350
400
2021202020192018
EUR million
368
325
239
344
EBITDA
0
20
40
60
80
100
2021202020192018
EUR million
24
92
46
32
Axactor at a glance
Axactor is a pan-European company focusing on craftmanship debt collection with digital and
state-of-the-art solutions for managing non-performing loans. The Group has two core business
segments: Acquisition and collection on own portfolios of non-performing loans (NPL) and
debt collection on behalf of third-party customers (3PC). The primary focus is unsecured debt
originated within the ınancial sector. In addition, Axactor has a non-core business segment
which is currently in run-off mode, acquiring and selling repossessed assets (REO).
Axactor has operations across Finland, Germany, Italy, Norway, Spain and Sweden, and had
approximately 1,100 FTEs at the end of the 2021. The book value of NPLs was EUR 1.1bn at the
end of 2021, with an estimated remaining collection of EUR 2.1bn.
Estimated Remaining Collection (ERC), NPL
0
1
2
3
2021202020192018
EUR billion
1.4
2.0
2.2
2.1
Cash EBITDA
0
50
100
150
200
250
300
2021202020192018
EUR million
251
136
224
210
Axactor Group4
Gross revenue per country
SWE
13%
ITA
8%
FIN
7%
ESP
38%
NOR
19%
DEU
14%
Our presence
Annual report 2021 5
• Aggressive growth
• Market entries
• Establish IT and operations
Establish platform Secure foundation Value generation
• Grow size in existing markets
• Operational excellence
• Initiate divided payments
• New strategy
• Stabilize operations
• Exit non-core segments
NPL ERC
EUR million
317
633
1,388
2,038
2,169
2,141
Established
as Axactor
Q4-2015
2025202420232022202120202019201820172016
Entering an era of value generation
Through a clear growth strategy Axactor has expanded its operations into six geographies since the inception in 2015: Finland, Germany, Italy,
Norway, Spain and Sweden. The aggressive growth has been targeted at sound markets for owning and collecting on non-performing loans
(NPL) within Europe. Through an industry leading IT and operations platform and 1,096 skilled employees, Axactor is positioned as an attractive
partner for banks and the ınancial sector.
6 Axactor Group
Our values
Passion
We are passionate about everything we do
· Being focused
· Feeling personal commitment
· Loving challenges and wanting to improve
Trust
We act with integrity, create trust, and build long-term relationships
· Delivering what we promise
· Being straight and clear in our communication and treating everyone with
respect
· Cooperating effectively together as a team to be best in our selected
markets and segments
Proactive
We are proactively looking for things to improve
· Constantly learning from each other
· Solving problems with an innovative and creative approach
· Dedicating and continuously developing ourselves to deliver the
best possible service
Our core values deıne us and are embedded in everything we do. They serve as a
declaration of how we treat each other, our customers, debtors, and our partners. As we
expand into new markets, recruit new talent, and face new challenges, these values guide our
decisions and actions.
Annual report 2021 7
Our purpose and vision
Purpose
Our purpose is to help people and companies to a better future.
We wake up every morning proud of working for Axactor because we know we make a
difference. Every day we passionately help people pay their bills and make sustainable plans to
get out of debt. Every day we help hard-working companies to get paid for their products and
services. Last but not least, every day, we serve as an important cornerstone of the ınancial
system – enabling people to beneıt from tomorrow’s money today. No debt collection, no
borrowing of tomorrow’s money.
Click here to learn more about our purpose
Vision
Our vision is to be the industry benchmark.
Axactor was founded in 2015 because we believed it was possible to do it better. We were
convinced it was possible to operate more efıciently with innovative and less costly IT-systems
and more streamlined processes. A company raising the bar on environmental, social, and gov-
ernmental standards. A company that delivers the best advice and fairest treatment of debtors,
with more satisıed customers, happier employees, and, with higher return to investors. Our
vision is to be the industry benchmark. The company that reinvents debt collection and that
other will use as the benchmark when they want to improve.
Click here to learn more about our vision
Axactor Group8
Highlights of the year
Full year 2021
x A year impacted by continued pandemic and positioning the
company for future value creation
x Gross revenue of EUR 344 million, up 6% from 2020
Total income ended at EUR 195 million, down 3% compared
to 2020
x EBITDA for the year of EUR 24 million, resulting in an EBITDA
margin of 12%
x Cash EBITDA of EUR 224 million, up from EUR 210 million in 2020
x EUR 114 million invested in NPL portfolios throughout the year,
of which EUR 71 million invested under forward low agreements
x NPL book value decreased from EUR 1,125 million at the end of
2020 to EUR 1,096 million at the end of 2021, partly due to the
relatively low investment level and partly due to net negative
NPL revaluations
x Estimated remaining collections on NPL portfolios ended the year
at EUR 2,141 million
x 3PC total income growth of 3% with markets slowly normalizing
towards the end of 2021 after a period of historically low volumes
during the Covid-19 pandemic
x REO sales upheld on same volume as in 2020, totaling EUR 40
million for 1,263 assets
x Net proıt for 2021 was EUR -46 million
x Conducted large balance sheet restructuring including share issues,
reınancing of funding lines and the acquisition of the minority stake
in Axactor Invest I
x Obtained credit rating from leading credit rating agencies Moody’s
and S&P, and issued a EUR 300 million rated bond in the European
high yield market
x Return on equity (excluding non-controlling interests) was -9%
x Announced the acquisition of Italian debt collection service
provider Credit Recovery Service
Annual report 2021 9
Signiıcant events in 2021
2021 was a year impacted by the continuation of the Covid-19
pandemic and characterized by high uncertainty. Mitigating meas-
ures from the governments to contain the virus were introduced,
withdrawn and re-introduced on a running basis following the
development and spread of the virus. Large parts of Axactor’s work
force have been working from home ofıce for long periods during
2021, and local restrictions such as moratoriums, payment reliefs and
interest caps have been prolonged in several of Axactor’s six countries
of operation.
Simpliıcation and increased transparency were the mantras of
2021 for Axactor. At the end of 2020 and into early 2021, Axactor
performed a large balance sheet restructuring. The exercise included
an increase in share capital, the acquisition of a minority stake in a
co-investments vehicle, and the reınancing of several credit lines at
improved terms and with extended maturities. Furthermore, Axactor
issued its ırst rated bond with ACR03 in the third quarter. The REO
funding facility from Nomura was also repaid in full during the year.
At the end of 2021, these transactions secure a sound equity ratio
of 29%, a healthy leverage ratio of 3.4, and a clean setup for its core
business with only two sources of credit: bond loans and the revolving
credit facility.
After a promising ırst half of the year, NPL collection performance
deteriorated to 89% for the third quarter. Although there was a
positive development during the fourth quarter, it was not sufıcient to
support the book value of the portfolios. As a response, Axactor did
a thorough review of the portfolios and took down future collection
estimates. Total net NPL revaluations in 2021 thus ended at negative
EUR 44.1 million. The new book values are considered robust, and the
Group is in a good position to deliver proıtable growth going forward.
NPL investments for 2021 ended at EUR 114.0 million. Axactor
continued to prioritize quality over quantity and remained capital
disciplined. The most attractive portfolios for Axactor on the market
in 2021 were forward low portfolios in the Nordic countries and
Germany. As forward low contracts typically have a length of 12 to 24
months, these contracts secure volumes going into 2022. Estimated
investment commitments for 2022 at the end of 2021 stood at EUR
117 million, enough to secure book value growth in 2022.
A cost reduction program was launched at the start of the year, aiming
to reduce operating expenses by EUR 4.7 million compared to the
fourth quarter 2020. The main elements of the program were site
consolidations and outsourcing of non-core business. The project
concluded successfully with annualized savings of EUR 5.5 million,
enhancing Axactor’s margins and cost-to-collect position.
The 3PC segment saw lower volumes during the pandemic both
due to government-imposed restrictions and from lower consumer
spending. The situation was gradually normalizing towards the end
of 2021 and the segment income ended 3% up from 2020. Most of
the cost reduction program was directed at the 3PC segment with
signiıcant restructuring costs. The margin improved substantially
towards the end of the year as the initiatives came into full effect.
The acquisition of Italian debt collection service provider Credit
Recovery Service announced in 2021, closed early 2022, will further
enhance the healthy development for the 3PC segment.
Operational improvements are continuously being implemented and
Axactor is pleased to see good results in 2021. User trafıc through
the self-service debtor portal increased by ıve times compared to
2020. The operational department delivered strong solution rates,
as evidenced by winning 72% of all 3PC benchmark competitions
participated in during the fourth quarter.
Axactor Group10
Key ıgures
Gross
Revenue
344
EUR million
6% y/y
ERC, NPL
2,141
EUR million
-1% y/y
EBITDA
24
EUR million
12% margin
Cash
EBITDA
224
EUR million
Equity
ratio
29%
Key Figures Axactor Group
EUR million 2021 2020
Gross revenue 344.5 325.2
Total income 195.1 201.2
EBITDA 23.7 32.0
Cash EBITDA
1)
223.8 209.5
Depreciation and amortization (excl portfolio amortization) (9.7) (10.8)
Net ınancial items (54.8) (53.4)
Tax (expense)
(5.3)
(1.8)
Net proıt/(loss) after tax
(46.0)
(34.0)
Return on equity, excluding non-controlling interests (8.5%) (6.1%)
Return on equity, including non-controlling interests (11.3%) (9.1%)
Growth total income, period to period
(3.0%)
(29.5%)
Cash and cash equivalents, end of period
2)
38.2
47.8
Gross revenue from NPL Portfolios 254.9 236.5
Gross revenue from REO Portfolios 39.8 40.4
Acquired NPL portfolios during the period 114.0 208.2
Acquired REO portfolios during the period 0.2 0.4
Book value of NPL, end of period 1,095.8 1,124.7
Book value of REO, end of period 29.3 78.8
Estimated remaining collection (ERC), NPL
2,140.5
2,169.2
Equity ratio 29% 28%
Interest bearing debt, end of period 838.3 936.2
Number of Employees (FTEs), end of period 1,096 1,128
Price per share, last day of period 7.55 10.70
1) Cash EBITDA is EBITDA adjusted for change in forward low derivatives, calculated cost of share option program, portfolio amortizations and revaluations, REO cost of sales and
REO impairments. See APM table
2) Restricted cash excluded
Annual report 2021 11
A brighter future
Letter from the CEO
There is unfortunately no way around the fact that result wise, 2021 was
a challenging year for Axactor. The pandemic continued to impact our
operations in a wide variety of ways. New variants of the virus and local
restrictions came and went throughout the year. In short, 2021 was a
year characterized by high uncertainty. This has been challenging to
handle not only from an administrative perspective, but also for our
employees who again had to endure long periods at home ofıce.
Returning to proıtable growth
As a young company with a short track record and limited amounts of
data, Axactor had to assume a certain level of risk to achieve the desired
growth during our ırst years after formation. The growth strategy paid
off, with Axactor today being among the leading credit management
companies in Europe. During the second half of 2021 however, certain
portfolios did not meet the expected level of collection. This resulted in
a net negative revaluation of EUR 43 million in the fourth quarter of the
year, mainly directed at portfolios acquired in 2017 and 2018 and with
an extra emphasis on Swedish portfolios. The new revised collection
curves, combined with a substantially higher proıtability on more
recent acquisitions, puts us in a much better position going into 2022
than we have had in the past.
Our 3PC segment has been strengthening throughout 2021 as we
have managed to retain our most important customers through the
pandemic. Now that volumes are returning, we expect the segment to
continue the positive development into 2022. To further enhance our
3PC service offering in Italy, we announced the acquisition of the debt
collection servicer Credit Recovery Service. They are a great ıt with
our strategy, servicing banks and ınancial institutions.
During the year we completed a cost reduction program aimed
primarily at site consolidations and outsourcing of non-core business.
Such processes are tough, but unfortunately necessary. The positive
side is that with the conclusion of the cost reduction program, we
have an efıcient operational setup well-suited for our needs. In
2022 we will shift focus from cost reductions to continuous smaller
improvements for our everyday operations to maintain our position
as a market leader in terms of cost-to-collect.
To simplify and improve our legal and ınancial structure we completed
a long series of signiıcant transactions during 2021. The result was
an increased equity ratio, and extended maturities and improved
terms for all major credit lines. At the end of the year, we have a much
cleaner legal structure for our continued operations, with two sources
of credit: bond loans and our revolving credit facility. Despite the
negative revaluations in the fourth quarter, our cash low has remained
good throughout 2021. Axactor is a solid company in a comfortable
liquidity position. We have an investment capacity of around EUR 300
million for 2022, ready to take part in the increasing market for NPL
acquisitions.
To sum up, we spent 2021 positioning Axactor for future value creation.
Operational excellence
Our employees are our greatest asset and their wellbeing is on the
top of our agenda. Both because we care deeply about our people,
but also because we believe that satisıed employees perform better,
both at work and at life in general. This year we joined forces with
Great Place To Work to measure the satisfaction of our employees.
I am very pleased that ıve out of our six countries of operations were
certiıed as a Great Place To Work. It is quite uncommon to receive
this certiıcation the ırst time the survey is performed, and we will
strive to further improve in 2022.
The people of Axactor have had another difıcult year with disruptions
from Covid-19, as well as difıcult transitions arising from the site
consolidations and outsourcing initiatives. Still, our operational depart-
ments have delivered good results, as evidenced by the very strong
scores on both debtor and customer satisfaction. I am impressed by
how the whole organization has handled these troubling times, and
I ırmly believe we have the best people onboard to take Axactor to
the next level.
Strong focus on sustainable business
With a continued focus on improving the sustainability of our business,
Axactor signed the United Nations Global Compact in 2021. We thus
commit to making its principles a part of our strategy, our culture, and
our day-to-day operations, beneıtting both our stakeholders and the
society as a whole. I am excited to present our ırst “Communication
of Progress”, which is incorporated into our sustainability report.
I would also like to take this opportunity to reiterate our continued
commitment to the UN Global Compact initiative.
Axactor Group12
I ırmly believe we have the best
people onboard to take Axactor
to the next level
Johnny Tsolis,
CEO
Annual report 2021 13
1. Market development
The years leading up to the Covid-19 pandemic were categorized by
high supply in the market for both sale and outsourcing of non-per-
forming loans. During the last two years, the pandemic has temporarily
disrupted the market. Consumer lending volumes have declined and
default rates are reduced. In addition, local restrictions have paused
collection processes. As more and more of these restrictions were
lifted towards the end of 2021, the market gradually returned.
The market activity for non-performing loan sales was back to a nor-
malized level at the end of 2021. However, the lower volume of defaults
through the pandemic has reduced the average volume for individual
transactions compared to pre-pandemic levels. With increasing con-
sumer spending and lending, the generation of non-performing loans is
expected to increase. Alongside a continued focus from regulators on
banks and ınancial institutions to ofload bad debt from their books, the
market activity for both portfolio sales and outsourcing of collection
services should continue to gain momentum in 2022.
2. Strategy
Axactor was incepted on the notion that the debt collection industry
was inefıcient. As a young challenger without legacy, Axactor could
disrupt the market in terms of cost-to-collect. During 2021 a strategy
update was implemented, intensifying the focus on this cornerstone
of Axactor’s vision.
To ensure that Axactor maintains the position as a market leader in
terms of cost-to-collect a cost reduction program was implemented
throughout 2021. The program aimed primarily at outsourcing non-
core operations and reducing the number of operative sites. A total
of seven ofıces were closed during the year, with the remaining sites
taking over the operational tasks. At the end of 2021 Axactor has the
desired locations for the long run in all six countries of operation.
With the conclusion of the cost reduction program at year-end,
focus is shifted from cost reductions to continuous operational
improvements and cost saving innovations.
The updated strategy entails a narrow focus on the core competence
of Axactor: fresh unsecured consumer debt originated within the
regulated ınancial sector in carefully selected markets. Axactor
performs craftsmanship debt collection services well suited for the
typical size and complexity of these claims. Furthermore, this segment
is perceived by Axactor as having the best risk/reward relationship.
To maximize proıts, Axactor focuses primarily on this core competence.
Axactor offers two main products to its customers: third-party
debt collection services and acquisition of non-performing loans.
By combining the two product offerings, Axactor both diversiıes
its income stream and leverages synergies between the business
segments in terms of business origination, collection execution and
data generation. In addition, the combined product offering improves
scale beneıts for both business segments.
Having dedicated and motivated employees with great industry
knowledge is crucial to deliver on the strategy. To attract, retain and
develop the best talents, a high attention is directed towards making
Axactor an attractive employer with good career opportunities.
The Axactor Academy program offers a wide variety of courses to
increase the employees’ skill sets. Promising talents are given the
opportunity to participate in a mentorship program, where senior staff
members provide personal guidance and learning opportunities for
the participants. These initiatives are in place to enable the desired
performance culture that characterizes Axactor.
To enable the employees to achieve their potential, they need
efıcient tools to perform their work. Axactor has had a clear strategy
from day one of having modern, standardized and efıcient common
IT solutions for the Group. As a young company with very little legacy,
Axactor has had the opportunity to design and build its IT environment
from scratch. The result is an IT platform with low maintenance cost
combined with a high level of efıciency and security.
Report of the Board of Directors
Total income per country
%
NOR
18%
DEU
16%
FIN
5%
ITA
9%
ESP
49%
SWE
3%
NOR SWEESPITADEUFIN
2021
Total income
EUR 195.1m
NPL book value per country
%
ESP
24%
NOR
23%
DEU
12%
SWE
21%
ITA
10%
FIN
10%
NOR SWEESPITADEUFIN
NPL
book value
EUR 1.1bn
Axactor Group14
To further develop operations and enhance future efıciency, a
continued emphasis is put on business intelligence, advanced data
analytics and contact and payment channels. During 2021, new
scorecards utilizing machine learning were developed, numerous
business intelligence reports implemented and trafıc through the
self-service debtor portal increased signiıcantly. These areas of
development will remain crucial for Axactor also going forward.
Another important beneıt of having common systems and setup
on both the IT and the organizational side, is improved cross-border
cooperation. It eases communication between countries, which in
turn enables sharing of best practices and innovations.
Cyber security is continuously growing in importance. A beneıt of
Axactor’s strategy is that the modern and streamlined IT environment
by default is up to the best current security standards. Working with
large amounts of personal data, the employees of Axactor have a
continuous focus on cyber security in their everyday operations.
Training sessions and stress tests are performed on a running basis
to be prepared for potential attacks. Axactor was the victim of an
attempted large scale phishing attack in 2021 and is pleased to see
that all routines and responses were in place to prevent the attack.
Axactor strives to be a transparent, reliable and trustworthy company
with focus on fair treatment of debtors, clients and employees alike.
As a part of this ambition, Axactor has joined the United Nations
Global Compact and adheres to the United Nations sustainable
development goals 5 Gender equality, 8 Decent work and economic
growth, 13 Climate action and 16 Peace, justice and strong institutions.
This ambition is inherent in Axactor’s DNA and affects all parts of the
Group’s business and decisions. Axactor sees working in a sustainable
matter as an obvious goal in itself, and it is also an increasingly
important factor for banks and ınancial institutions when they select
their business partners.
In order to fund the substantial growth during Axactor’s formative years,
the Group adapted its legal structure to exploit available sources of
credit. This resulted in a complicated and sub-optimal structure. During
2020 and 2021 several actions were taken to streamline the legal and
funding structure, including mergers, reınancing of credit lines and
liquidation of redundant legal entities. Not only does this ease the
administrative burden and cost, but it also increases transparency and
makes it more comprehendible for investors, customers and other inter-
ested parties. This increased transparency is also in line with Axactor’s
continuous focus on sustainable development and ESG factors.
To enable access to the European bond market, Axactor obtained
credit ratings from leading credit rating agencies Moody’s and S&P
during 2021. Subsequent to obtaining the credit rating, Axactor raised
EUR 300m in a rated bond issue directed towards the European high
yield market at a substantially lower margin than obtained for previous
bond issues. This was a milestone for Axactor in the strategic quest to
obtain a lower funding cost.
At the end of 2021 Axactor has a clean legal structure for its continued
operations, with two sources of credit: bond loans and the revolving
credit facility. The result is increased lexibility and reduced funding
cost. To support even more lexibility at further improved prices, the
Group over time aims to increase the share of unsecured bond loans
relative to secured bank ınancing.
With a relatively short history, Axactor has acquired the majority of
its NPL portfolio during an economic cycle of high prices. With the
current market environment and a strict price discipline the Group
expects a gradual improvement over time. During 2021, Axactor
acquired portfolios with a weighted average gross IRR of 23.4%,
compared to an average of 15.7% on the total back book at the
beginning of the year. NPL investments are expected to increase
signiıcantly from the historically low level of EUR 114 million in 2021.
To underline this, estimated commitments for 2022 under signed
contracts already amounts to EUR 117 million at the end of 2021.
These commitments have a weighted average gross IRR of 21.9%,
also substantially higher than the average of 16.3% for the current
back book.
Axactor has established a skilled, scalable, lean, and passionate
organization that is well positioned to continue the company’s growth
journey. To deliver proıtable growth, Axactor will continue to improve
operational performance, show investment discipline and grow the
capital light part of the business. The Group will further intensify the
investor relations work with banks, bond market, equity market and
other sources of capital. Finally, Axactor will continue to pursue fair
debtor treatment, high customer satisfaction and happy employees.
3. Operations
When entering 2021 the expectation was that the pandemic situation
would affect the business operations in a more limited way than in
2020. The majority of the workforce was still working from home at
the start of the year, but the home ofıce regulations were expected
to be removed within a short time period. Axactor had operational
capacity to handle the expected increase in volumes with limited
need to increase manning.
The beginning of 2021 nevertheless started slowly due to stronger
seasonality effects within the NPL segment and lower than expected
3PC volumes from the existing customers. The moratoriums in Italy
and Spain had continued into 2021 and affected both NPL and 3PC
collections. Volumes from both 3PC and NPL forward low contracts
were limited by low default rates in the banks in the Northern part of
Europe. While the NPL segment improved during the ırst half of the
year, the 3PC segment took longer to recover.
A cost saving program was initiated during the ırst quarter as a response
to the lower volumes. The largest part of the program was related to
closing down operational sites and divisions servicing 3PC customers.
Annual report 2021 15
In Spain, the restructuring meant that the services done in Sevilla,
Bilbao and Zaragoza were moved to the three larger operational
centers in Madrid, Valladolid, and Alicante. For Finland, a homeshoring
initiative was conducted with the close-down of the back ofıce
departments in Estonia and Latvia and transferring the tasks back
to Finland. In Germany, the non-core ıeld-service operation was
outsourced. In Norway, a decision to close down the Hamar ofıce
was made. Axactor Norway have gathered all operations in the main
ofıce of Drammen going forward. The total effect of the cost saving
program was an annualized saving of EUR 5.5 million.
Together with an improved cost base there was also a clear positive
trend of ınding amicable solutions with debtors, as well as highly
efıcient tax refund campaigns. The improved collections and recovery
rates gave an impression of returning back towards normality. Debtors
in all markets were also satisıed with the communication and
treatment, resulting in an average score of 4.5 out of maximum 5 in
the group wide debtor satisfaction survey. The high score was upheld
for the rest of 2021 and is a great testament of the work done by the
operational staff. Axactor is always trying to help the debtors back to
a sound economy, through ırm but friendly guidance and advice.
The second half of 2021 started off quite challenging during the
summer months. Even though the number of payments were at a
stable level, the average payment size dropped and resulted in lower
NPL collections. In addition, several 3PC contracts were transformed
into NPL forward low contracts resulting in lower revenues for
the 3PC segment. Towards the end of 2021 the NPL collection
performance steadily improved to 98% in December, while 3PC
volumes started to return as moratoriums and local restrictions
were gradually lifted.
Throughout 2021, resources and priority have been given to further
develop the debtor portal. Investments have been made to utilize
innovative payment solutions, offer self-service solutions to more
debtors, and build more advanced logic into the service to offer a
tailormade journey through the portal. The usage of the portal has
increased rapidly and the number of debtors logging in was over
ıve times higher in 2021 compared to 2020.
Axactor is continuing its dedication to strengthen the usage of data to
achieve more efıcient collection and securing good debt collection
practices. During 2021 the company has added new sources of data
to improve the enterprise data warehouse. The enterprise data
warehouse holds consistent data to facilitate cross border reports
and enable best practice sharing. Such cooperation is key within the
business intelligence community in Axactor, connecting business
intelligence employees in both the countries and on Group level.
The advanced analytics team was strengthened during the year, and
new areas have been supported by scorecards and improved analytic
capabilities. The scorecards are integrated in the daily operations and
play a key role in deciding the optimal worklow and supporting the
collection strategy development. Analysis have been conducted to
optimize call center opening hours and connecting the debtor with
the best suited case handler.
The efıciency measures implemented during 2021 have yielded
satisfactory results. The cost reduction program, the cost culture
in general, increased digital collection and self-service, as well as
leveraging advanced data analytics, are all supporting the key strategic
goal of being the market leader in terms of cost efıciency. The NPL
cost-to-collect ratio has been improved from 43.1% in 2020 to 42.5%
in 2021, despite the restructuring cost taken through the year.
NPL estimated remaining collections per country
0
500
1,000
1,500
2,000
2,500
2021202020192018
EUR million
1,388
2,169
2,141
2,038
NOR SWEESPITADEUFIN
REO book value per country
0
50
100
150
200
250
2021202020192018
EUR million
29
129
79
200
NOR SWEESPITADEUFIN
Axactor Group16
Axactor was faced with two relevant global security vulnerabilities in
2021. During the summer the Microsoft print spooler vulnerability was
discovered, and in December the Log4j vulnerability became known.
Both vulnerabilities were successfully mitigated with minimal impact
on the operational services of Axactor systems. The high focus on
information security, clear routines and policies, and the cooperation
with external partners, were success factors in reducing the impact.
Throughout the 2021 Axactor has continued the work to improve
information security awareness among all employees. Multiple
sessions, online learning programs and phishing campaigns have
been conducted. Results from the phishing campaigns shows positive
results with higher focus and understanding among the employees.
The work to increase awareness will continue to be a part of the yearly
information security exercises and planning for Axactor.
The REO segment has been in run-off mode in 2021 with no new
portfolios acquired since 2018. Sales volumes were nonetheless
upheld at a high level throughout the year, following a strategy of fast
paced liquidation.
4. Corporate Social Responsibility
Axactor strives to maintain the highest level of professional standards
and places maximum focus and importance upon honesty, integrity,
accountability, transparency, and compliance in all aspects of its con-
duct of business. Axactor is committed to comply with all applicable
laws and regulations in all business activities and act in an ethical,
sustainable, environmental, and socially responsible manner, practice
good corporate governance and respect internationally recognized
human rights principles. To safeguard compliance and support the
effectiveness of such acts, an open and ongoing dialogue on these
issues, internally and externally shall be maintained. The Board and the
executive management of Axactor are committed to Environmental,
Social and Governmental responsibility (ESG), supporting the UN
Sustainable Development Goals with speciıc focus on: 5. Gender
equality; 8. Decent work and economic growth; 13. Climate action;
16. Peace, justice and strong institutions. The UN SDG commitments
support the company’s values and policies ensuring a sound corporate
culture. During 2021 Axactor further strengthened its commitment to
the UN Sustainable Development Goals, by becoming a signatory to
the UN Global Compact. The sustainability report describes in detail
Axactor’s work on ESG, including the company’s reviews of working
environment, gender equality and the Group’s effects on the external
environment for 2021.
5. Financial performance
Total income
Total income for 2021 ended at EUR 195.1 million, down from EUR
201.2 million in 2020. The main driver of the decrease was net
negative NPL revaluations and an increase in NPL amortization rate
from 37% to 41%. This impact was partially offset by a 6% increase in
gross revenue, with increased collection on NPL portfolios and a 3%
growth in 3PC income.
Net NPL revaluations for the year were negative EUR 44.1 million, of
which EUR 37.6 million were taken in the fourth quarter as a response
to low collection performance during the second half of 2021. The
majority of the revaluations in the fourth quarter were directed at
portfolios acquired during 2017 and 2018, with an extra emphasis on
Swedish portfolios. With the new curves, Axactor is well positioned
to deliver a collection performance luctuating around 100% going
forward.
Gross revenue from the NPL segment increased by 8% to EUR 254.9
million in 2021 (236.5). The increase is mainly explained by portfolio
investments, as well as the gradual lifting of Covid-19 induced
collection restrictions across Europe. Due to the pandemic adjusted
curves put in place in 2020, the NPL amortization rate was lower than
normal in 2020. In 2021 the NPL amortization rate increased from 37%
to 41%, which in monetary terms translates to an increase from EUR
86.3 million in 2020 to EUR 104.4 million. Adding net NPL revaluations
of negative EUR 44.1 million (-36.9) and contribution from change in
forward low derivatives of negative EUR 0.8 million (-0.8), NPL total
income ended at EUR 105.6 million for 2021 (112.5). This represents
54% of total income (56%).
Total income by segment
0
50
100
150
200
250
300
2021202020192018
EUR million
285
207
NPLPortfolios 3PC REO portfolios
Other/Not allocated
201
195
Annual report 2021 17
Estimated remaining collection (ERC) on the NPL portfolios stood at
EUR 2,140.5 million at the end of 2021 (2,169.2), of which EUR 268.8
million is expected to be collected in 2022.
Continued investments in NPL portfolios are expected to drive gross
revenue growth for the NPL segment in 2022. Axactor invested a
modest EUR 114.0 million in NPL portfolios in 2021, down from EUR
208.2 million in 2020. The investment pace picked up throughout the
year, with 75% of total investments deployed during the second half
of 2021. These acquisitions provide momentum going into 2022.
In addition, a total estimated EUR 117 million of investments are
committed in signed contracts for 2022 per the end of 2021. Adding
new contracts in 2022, Axactor expects to deploy EUR 200-250 million
in NPL portfolio investments during the coming twelve months.
During 2021 Axactor implemented an update to its strategy with an
intensiıed focus on the core competence of the Group. This means a
stricter capital discipline with investments directed at fresh unsecured
non-performing consumer loans from known sellers. This reduces risk,
leverages customer relationships in both the 3PC and NPL segments
and ensures Axactor invests only in attractively priced, high-quality
portfolios. This strategy is evidenced by a signiıcantly higher gross IRR
on acquisitions in 2021 compared to the average for the back book.
This trend is expected to continue into 2022, with the current volume
commitments also made on gross IRR levels well above the current
back book average.
The 3PC business reported total income of EUR 49.6 million for 2021,
up 3% from 2020 (48.3). Local collection restrictions have hampered
growth for large parts of 2021, and several 3PC contracts were
transformed into NPL forward low contracts. Towards the end of the
year, the development turned positive in terms of both volume from
existing contracts and from new business. During the fourth quarter,
Axactor announced an agreement to acquire 100% of the shares in
the Italian debt collection service provider Credit Recovery Service
(CRS). The transaction was formally completed in January 2022 and
will have immediate impact on the results for 2022. 3PC continue to
be an important business segment for Axactor, providing a capital
light income stream and providing important synergies with the NPL
segment. The 3PC total income corresponded to 25% of total income
for the company in 2021 (24%).
The REO segment is in run-off mode and has not been considered
part of Axactor’s core business for some time. To further emphasize
this fact, the segment will be reported as discontinued operations
effective from 2022. Total income for the REO segment for 2021
ended at EUR 39.8 million, 1% down from last year (40.4) and
representing 20% of the Group’s total income (20%). A total of 1,263
assets were sold during the year, compared to 1,403 assets sold in
2020. While income and assets sold were upheld at a good level, the
number of assets in inventory declined 46% in 2021. Total number of
assets left in inventory at year-end is 1,446.
Operating expenses
Total operating expenses for 2021 amounted to EUR 171.4 million
(169.2), excluding depreciation and amortization. A cost reduction pro-
gram was implemented during the year, with annualized savings of EUR
5.5 million. Related restructuring costs of EUR 4.2 million are included in
total operating expenses for 2021. Furthermore, a settlement amounting
to EUR 2.2 million with a Swedish bank regarding the termination of a
forward low agreement was reached in the fourth quarter of 2021.
REO cost of sales of EUR 44.6 million (36.8) and REO impairments of
EUR 5.9 million (16.1) are included in operating expenses for 2021.
The impairments came as a result of reduced price expectations in
order to continue the fast paced ofloading of remaining assets.
Personnel costs accounted for EUR 61.3 million in 2021 (54.9) and
is the single most important input factor in Axactor’s operations.
The increase compared to last year is partly explained by restructuring
costs in 2021 and partly by temporary cost reductions put in place
during the initial phase of the Covid-19 pandemic in 2020.
Other expenses amounted to EUR 59.6 million (61.4), including IT/
infrastructure costs, legal fees and REO servicing costs.
Contribution by segment
The total contribution margin amounted to EUR 68.3 million in 2021
(71.7). The contribution margin relects the segments’ contribution to
EBITDA before local SG&A, IT and corporate cost. Please see Note 5
for more details.
The contribution margin from the NPL segment was EUR 69.5 million
in 2021 (75.3), relecting the net negative revaluations of 44.1 million
(36.9). The NPL contribution margin thus decreased to 66% of total
income (67%).
The contribution margin from 3PC was EUR 15.4 million (17.4),
corresponding to 31% of total income (36%). Most of the restructuring
costs in 2021 were directed towards the 3PC segment, and the margin
is thus expected to increase signiıcantly in 2022 as the saving initiatives
gain full effect.
The contribution margin from REO was negative EUR 16.5 million
(21.0), after cost of secured assets sold of EUR 44.6 million (36.8) and
impairments of EUR 5.9 million (16.1). The contribution margin was
hence negative 41% (-52%).
Local SG&A, IT and corporate cost amounted to EUR 44.6 million
(39.7) for 2021.
Axactor Group18
EBITDA
As a consequence of the net negative NPL revaluations and the REO
impairments, EBITDA shrunk from EUR 32.0 million in 2020 to EUR
23.7 million in 2021. The resulting EBITDA margin was 12% (16%). After
the correction of future NPL collection curves and the cost reduction
program carried out in 2021, Axactor expects proıtable growth in 2022.
Cash EBITDA ended at EUR 223.8 million in 2021, up from EUR 209.5
in 2020.
Further details on reported alternative performance measures are
available in chapter 8.7 Reported APMs.
Operating proıt (EBIT)
Some of the investments in the collection platforms during the initial
years of the Group’s history have now been fully depreciated or
amortized. After a period of stabilizing investments, depreciation
and amortization – excluding amortization of NPL portfolios – fell to
EUR 9.7 million in 2021 (10.8).
Operating proıt (EBIT) was hence EUR 14.1 million for 2021 (21.2).
Net ınancial items
Net ınancial items were negative EUR 54.8 million in 2021 (53.4),
comprising ınancial revenue of EUR 3.0 million (12.6) and ınancial
expenses of EUR 57.8 million (66.0).
Interest expenses on borrowings accounted for EUR 52.9 million in
2021, down from EUR 63.6 million in 2020. Several measures were
taken during the year to reduce the effective interest cost. At the very
beginning of the year, a large restructuring of Axactor’s balance sheet
was conducted. This included several loan reınancing transactions,
and EUR 7.1 million in loan fees pertaining to the reınanced loan
facilities were written down in 2020. Later in 2021, the bond like
instrument owned by Sterna Finance was reınanced through the issue
of an ordinary rated bond loan with a lower interest rate.
During the last years Axactor has seen a high volatility in its FX
exposure towards NOK and SEK. Measures have been taken in 2021 to
reduce this volatility, and the net foreign exchange impact included in
net ınancial items for 2021 was a modest EUR -1.5 million, compared
to a net impact in 2020 of EUR 11.5 million.
Other net ınancial expenses amounted to EUR -0.4 million (-1.3).
Proıts and tax
The proıt before tax was negative EUR 40.7 million in 2021 (32.2), and
the net proıt was negative EUR 46.0 million (34.0).
Axactor recorded a tax expense of EUR 5.3 million in 2021, compared
to a tax expense of EUR 1.8 million in 2020. Axactor expects to trend
towards a normalized average effective tax rate of approximately 25%
over time.
Net proıt to shareholders was negative EUR 32.8 million (18.1),
whereas the net proıt to non-controlling interests was negative EUR
13.2 million (15.9).
Total comprehensive income was negative EUR 37.3 million for 2021
(45.3), with the deviation from reported net proıt/(loss) after tax
mainly explained by foreign currency translation differences. EUR 24.1
million of this loss was attributable to shareholders of the parent
company (29.5) and EUR 13.2 million to non-controlling interests (15.9).
Earnings per share totaled EUR -0.112 both on an ordinary and on a
fully diluted basis (-0.099).
Financial position
Total assets amounted to EUR 1,293.2 million at the end of 2021
(1,363.6), of which book value of purchased NPL portfolios accounted
for EUR 1,095.8 million (1,124.7).
0
20
40
60
80
100
2021202020192018
EBITDA and EBITDA margin
EUR million and %
3292
+99%
46
32%
24
16%
22%
12%
Return on equity, excluding non-controlling interests
-10
-8
-6
-4
-2
0
2
4
6
8
2021202020192018
%
1.7 %
-8.5 %
-6.1 %
6.0 %
Annual report 2021 19
Total non-current assets amounted to EUR 1,196.7 million (1,215.3),
including intangible assets of EUR 87.5 million (82.6). This relects
intangible assets and goodwill acquired since inception, as well as
deferred tax assets of EUR 13.7 million (7.8).
Current assets amounted to EUR 96.5 million (148.3), including stock
of REO assets of EUR 29.3 million (78.8) and total cash and cash
equivalents of EUR 44.0 million (50.7), including EUR 5.8 million in
restricted cash (2.9).
Total interest-bearing debt stood at EUR 838.3 million at the end of
2021 after a net repayment of debt during the year (936.2).
Total equity amounted to EUR 381.2 million (375.7), including
non-controlling interests of EUR 1.0 million (74.1). A total of EUR 51
million was raised in new equity in 2021, while non-controlling
interests were reduced signiıcantly when Axactor acquired the
minority stake in the co-invest vehicle Axactor Invest I. The equity
ratio was 29% at the end of 2021 (28%).
Supervision of ınancial reporting
As communicated in a press release on 13 December 2021, Axactor SE
has received a conclusion from the Norwegian Financial Supervisory
Authority (FSA) in accordance with the preliminary conclusion as
stated in the press release of 2 September 2021. The FSA requires
that the company expands its measurement model for portfolios
of non-performing loans (NPL) with more input variables capturing
current and future macroeconomic conditions and use of scenarios
with effect from the reporting of the annual accounts for the ınancial
year 2022. The company take notice of the conclusion from FSA and
will implement the requested changes accordingly.
The notice from the FSA also requires the company to conduct a new
measurement of one speciıc NPL portfolio as of 2019 and onwards.
The company will document the assumptions used for estimates of
future credit losses occurring after 2026. The company has performed
a new measurement with the information available at the end of 2019
and an external valuation agency has provided a benchmark valuation
to verify the internal measurement. Based on the updated measure-
ment, the company has booked an impairment of EUR 1.8 million in
the fourth quarter of 2021. The error is related to 2019, but is regarded
as not material and a retrospective restatement has not been made,
in accordance with IAS 8 Accounting Policies, Changes in Accounting
Estimates and Errors.
6. Cash low and Financing
Net cash low from operating activities, including NPL and REO invest-
ments, amounted to EUR 109.6 million in 2021 (-1.7). The improvement
compared to 2020 was mainly due to reduced investments in NPL
portfolios. The amount paid for NPL portfolios fell from EUR 213.0
million in 2020 to EUR 115.4 million in 2021. The difference between
the amount paid and total NPL investments for the year is related to
deferred capex on certain contracts. Excluding investments in NPL
portfolios, cash low from operating activities was EUR 224.7 million
(209.7), mainly driven by the increase in cash EBITDA. The difference
between cash EBITDA and cash low from operating activities before
NPL investments relates to taxes paid of EUR 3.3 million (5.5) and a
decrease in working capital, excluding forward low derivatives, of
EUR 4.2 million (5.7).
Net cash outlow from investing activities was EUR 4.7 million in 2021
(6.1), mainly relecting reduced IT and infrastructure investments.
Net cash low from ınancing activities was negative EUR 112.4 million
in 2021 (-15.7). Net proceeds from borrowings were negative EUR
86.2 million after debt repayments (-2.8), whereas proceeds from
equity issues were EUR 50.8 million (50.8).
Proceeds to non-controlling interests were EUR 6.6 million for 2021 (7.0).
Interest payments, loan fees and costs related to share issues
represented a cash outlow of EUR 67.5 million in 2021 (53.9).
Funding
At the beginning of 2021 a large restructuring of the balance sheet was
completed. The restructuring exercise included several steps aimed at
lowering the effecting funding cost and simplifying the legal structure
to reduce administrative cost and increase transparency. In short, the
steps were:
x A share capital increase by contribution in kind was done as payment
for the minority stake in the co-invest vehicle Axactor Invest I.
After the transaction Axactor owns 100% of shares and A-notes
in Axactor Invest I. As part of the transaction, the B-notes held by
Sterna Finance were converted into a bond-like debt instrument
with Axactor SE as counterpart
NOR SWEESPITADEUFIN
0
100
200
300
400
500
2021202020192018
Annual NPL investments per country
EUR million
462
208
114
398
Axactor Group20
x Axactor’s main funding line, a revolving credit facility from DNB and
Nordea, was reınanced and the maturity extended to 2024. As part
of the reınancing, the revolving credit facility in Axactor Invest I was
merged with the main funding line. The new loan agreement has
similar terms as the previous main funding line, but with a pricing
mechanism dependent on the portfolio loan-to-value. The total
facility is of EUR 620 million, of which EUR 75 million in the form of
an accordion option
x The bond loan AXA01 was reınanced with a new bond issue,
ACR02. The vast majority of the AXA01 bonds were rolled into
ACR02 bonds, with the remaining AXA01 bonds settled. Pricing and
general terms for ACR02 are similar as for AXA01
x Subsequent to the share capital increase by contribution in kind, a
private placement of EUR 30 million was carried out. Following the
private placement, an additional EUR 20 million were raised through
a repair issue
Through the roll-up of Axactor Invest I, Geveran increased their
ownership share in Axactor to 44.31%, triggering a mandatory offer
for the remaining Axactor shares. The offer was placed at NOK 8 per
share. The Board of Directors decided not to recommend shareholders
to accept the offer. Geveran received valid acceptances under the
mandatory offer for a total of 625,806 shares, corresponding to
approximately 0.23% of the registered share capital and voting rights
in the company.
These transactions signiıcantly increased the equity and extended the
majority of debt maturities to 2024, while the roll-up of Axactor Invest
I will be accretive for the shareholder’s return on equity.
Further to the above transactions, Axactor obtained a credit rating
from leading credit rating agencies Moody’s and S&P, and issued its
ırst rated bond loan in 2021. The ACR03 bond has an outstanding
balance of EUR 300 million and a loating interest rate of EURIBOR
+535bps. This bond loan is thus signiıcantly less expensive than the
unrated ACR02 bond. Proceeds from the ACR03 issue were partly
used to reınance the bond like debt instrument held by Sterna ınance
and the local Italian credit lines.
The REO ınancing from Nomura was amortized in full during 2021.
Going out of 2021, Axactor has two sources of credit: bond loans and
the revolving credit facility from DNB and Nordea. All legal entities
except Axactor SE and the Reolux structure are inside the ringfenced
structure that is funded by the revolving credit facility. This ensures
a clean and transparent setup for Axactors continued operations in
2022 and onwards.
Axactor has remained compliant with all loan covenants through 2021.
7. Reported alternative performance measures
Axactor uses gross revenue, EBITDA, cash EBITDA, Estimated
remaining collection, NPL, Return on equity and Net interest-bearing
debt as an alternative performance measures (APM) to better relect
its operational business performance and to enhance comparability
between ınancial periods. These alternative performance measures
are reported in addition to, but not as a substitute for, the performance
measures reported in accordance with IFRS. Numbers in brackets refer
to the corresponding ıgure in the previous year. For deınition and
reconciliation tables of the used APMs, see page 138.
8. Proposed allocation of the company’s results
The parent company, Axactor SE, had a net negative result after tax
of EUR 16.4 million in 2021, compared to negative EUR 27.2 million in
2020. The result available for disposal of the Annual General Meeting
is as follows:
EUR thousand
Distribution from other paid in capital 16,404
9. Corporate Governance
The governance structure of Axactor SE complies with Norwegian
corporate law and Norwegian securities legislation and stock
exchange regulations. The shares of Axactor are freely negotiable.
There are no restrictions on owning, trading, or voting for shares in the
Articles of Association. The shares in the company are not subject to
any transfer restrictions. The Board has approved guidelines for good
corporate governance in accordance with the Norwegian Code of
Practice for corporate governance issued by the Norwegian Corporate
Governance Board (NCGB and NUES), last revised on 14 October 2021.
Axactor is fully compliant with the NUES recommendations. A detailed
description of the corporate governance principles and reporting for
2021 can be found in the Corporate governance report.
Axactor holds directors, ofıcers and company liability insurance
policies covering the Directors of the Board and the CEO. The policies
are granted by primary and excess insurers. The insurances cover the
liability from claims which may arise from the decisions and actions
taken within the scope of their regular duties. The coverage includes
ınancial protection against the consequences of wrongful acts, their
personal liability, ınancial loss in respect of any securities claim made
against the company and certain costs and ınes related herein. The
policies also cover reimbursement of the company where coverage
has been made on their behalf. Coverage does not include fraudulent,
criminal or intentional non-compliant acts or cases where directors
obtained illegal remuneration, or acted for personal proıt.
Annual report 2021 21
10. Risk proıle
Axactor’s regular business activities entail exposure to various types
of risk. There is a risk that the Group will be unable to compete with
businesses that offer more attractive pricing levels and the Group’s
competitors may have or develop competitive advantages that the
Group is unable to match. Reputational damage due to an unforeseen
event could adversely affect the business and ability to attract new
customers. If the Group is unable to enter new debt collection
contracts, fails to collect third party’s or own debts, is unable to
purchase portfolios at appropriate prices or to make acquisitions that
prove unsuccessful e.g., due to incorrect assumptions. There is also
a risk that the business and ability to implement the business plan will
be materially adversely affected. A failure to comply with applicable
regulations in relevant jurisdictions may materially adversely affect the
ınancial position due to e.g., loss of customers and/or ınes to pay, and
the ability to operate in such jurisdictions due to e.g., loss of license.
A failure to employ and retain skilled personnel and to retain third-party
service providers may have a material adverse effect on the operations.
A pandemic situation may, as experienced in 2020-2021, affect the
operational efıciency, impairment, and the Group’s ınancial results.
Enhanced focus from authorities and stricter rules and practices related
to e.g., AML, GDPR, tax/vat and NPL are ongoing risks. The Group in
all materiality complies with relevant rules and regulations for debt
management providers in all its geographical markets. Axactor is also
subject to regulatory changes in individual markets, such as temporary
rules related to the Covid-19 pandemic, proposal for revised debt
collection regulations in Norway anticipated during ırst half of 2022
and the currently discussed implementation of the NPL regulations
(EU) 2019/630 of 17 April 2019 amending Regulation (EU) No 575/2013
as regards minimum loss coverage for non-performing exposures
in Norway. Axactor monitors regulatory changes relevant for the
business and is member of relevant association of debt collection
and debt purchase companies locally such as ANGECO (member of
FENCA) in Spain. Other important regulatory developments are the
rapidly increasing number of regulations both in Norway and from the
EU on sustainability reporting requirements, such as Regulation (EU)
2020/852 (Taxonomy), the proposal for a Corporate Sustainability
Reporting Directive (CSRD), the Norwegian Transparency Act
(“Åpenhetsloven”), etc. These developments are being carefully
monitored to ensure compliance also going forward. Axactor adheres
to new rules and believe the above-mentioned regulatory changes
will have limited ınancial impact, but in relation to the ever-increasing
reporting requirements, Axactor considers the administrative burden
to be notable.
Axactor also faces operational risks, mainly related to IT stability,
application availability, as well as information security and data
processing. The company seeks to mitigate these risks through
partnerships with certiıed infrastructure, hardware and software and
application providers and strict internal control including vendor
management. These and other risk factors are covered in Note 3 of
the Groups ınancial statement. Axactor’s ınancing and ınancial risks
are managed within the Group in accordance with the Finance policy,
the Treasury policy, and the Hedging policy established by the Board.
Internal and external ınancial operations are concentrated to the
Group’s central ınance function. Axactor’s exposure to market risks
relating to interest rate, currency, credit, liquidity, and ınancing are also
covered in detail in Note 3 to the Group’s ınancial statement.
The main risks related to interest rates, liquidity and ınancing can be
summarized as follows: The interest rate risk relates to the variable
rates on Group’s interest-bearing debt, which amounted to EUR 838.3
million per the end of 2021 (936.2). An annualized increase/decrease
of 100 basis points would increase/ decrease proıt before tax by EUR
7.0 million (9.4). The average effective interest rate for 2020 was 6.9%
(5.8%).
With regards to liquidity, the Group’s objective is to maintain a balance
of ınancial assets that relects the cash requirements of its operations
and investments for the next 12-24 months. The cash low from
operating activities generated by the Group was positive in 2021, with
relatively low investments in NPL portfolios. In previous years the NPL
investments have exceeded the cash low from operating activities
before NPL and REO investments. The 46% drop in amount paid for
NPL portfolios from 2020 to 2021 shows how quickly the investment
level can be scaled down. As long as Axactor deliver positive cash
low from operating activities before NPL and REO investments, the
Group will not hesitate to increase the NPL investments in the future
to secure proıtable growth. Per the end of 2021 the Group held cash
and cash equivalents of EUR 38.2 million excluding restricted cash
(47.8). The liquidity is managed at Group level.
The Group has certain ınancial covenants tied to its funding facilities.
The headroom under these covenants were substantially improved
through a large restructuring of the balance sheet at the start of 2021.
Axactor has thus remained compliant with all covenants throughout
2021. Axactor has an investment capacity of approximately EUR 300
million at the end of 2021, and plans for an investment level in NPL
portfolios between EUR 200 million and EUR 250 million in 2022.
Given the current ınancial position, cash low projections and invest-
ment outlook, the Board consider the liquidity risk to be fairly low.
If any of the risks mentioned above were to materialize, either
individually, cumulatively or together with other circumstances, it
could have a material adverse effect on the Group and/or its business,
results of operations, cash lows, ınancial condition and/or prospects,
which may cause a decline in the value and trading price of the shares.
Axactor has adopted a regime to manage and mitigate these risks. The
Board has adopted a risk management policy. Annually a bottom-up
and top-down risk assessment covering the entire risk spectrum
is carried out. The Chief of Staff has the operational responsibility
for risk management. The countries provide status updates of the
Axactor Group22
internal control, most important risks and mitigation measures to the
executive management on a monthly basis and ad-hoc when needed.
Risks are discussed in the weekly executive management meeting and
are reported quarterly to the audit committee.
11. Going concern
Based on the review of Axactor SE’s ınancial statement, the Board of
Directors conırms that the annual ınancial statements for 2021 have
been prepared on the basis of a going concern assumption, and that
this assumption has been made in accordance with Section 3-3a of
the Norwegian Accounting Act.
12. Outlook
After a challenging 2021, Axactor is in a good position to deliver proıt-
able growth in 2022. The large negative NPL revaluation booked in the
fourth quarter 2021 reduces downside risk for collection performance,
which is expected to luctuate around 100% going forward. The cost
reduction program has delivered above expectation, rendering a
lower cost base going into 2022 than the Group had going into 2021.
Furthermore, a series of initiatives to simplify the legal structure were
carried out in 2021, creating a more efıcient structure in terms of
expenses and administrative burden.
Although total NPL investments for 2021 was on the low side, the
fourth quarter saw a signiıcant uptick in investment level. These
acquisitions provide momentum going into the ırst quarter of 2022.
In addition, Axactor has estimated NPL investment commitments
for EUR 117 million in 2022 at a satisfying gross IRR level of 22%.
The forward low commitments alone are enough to secure positive
NPL book value growth for the coming twelve months. Adding
expected new acquisitions in 2022, Axactor expect to deploy
between EUR 200 million and EUR 250 million in NPL portfolios for
the coming twelve months.
3PC volumes are slowly returning towards pre-pandemic levels as
local restrictions such as moratoriums are gradually phased out.
The market for new 3PC business is healthy as well, with a strong
pipeline of potential new customers. In Italy, the acquisition of Credit
Recovery Service that was ınalized in early January 2022 will have
a signiıcant positive effect. Credit Recovery Service comes with
a recurring annual revenue of approximately EUR 6 million, as well
as improving Axactor’s standing in the Italian 3PC market for fresh
non-performing loans originated within the bank and ınance sector.
The ırst quarter of 2022 has seen increasing geopolitical risk in Europe
with the ongoing conlict in Ukraine. Although Axactor’s operations
are not directly impacted by the conlict, the executive management
and Board closely monitors the situation and potential indirect
business impact, and maintains the business continuity plans.
Oslo, 30 March 2022
The Board of Directors
Merete Haugli
Board member
Brita Eilertsen
Board member
Terje Mjøs
Board member
Lars Erich Nilsen
Board member
Kathrine Astrup Fredriksen
Board member
Hans Harén
Board member
Kristian Melhuus
Chair of the Board
Johnny Tsolis
CEO
Annual report 2021 23
We conırm to the best of our knowledge that the consolidated ınancial statements for 2021 have been prepared in accordance with IFRS
as adopted by the European Union, as well as additional information requirements in accordance with the Norwegian Accounting Act, that
the ınancial statements for the parent company for 2021 have been prepared in accordance with simpliıed IFRS pursuant to the Norwegian
Accounting Act and regulations regarding simpliıed application of IFRS issued by the Norwegian Ministry of Finance, and that the information
presented in the ınancial statements gives a true and fair view of the assets, liabilities, ınancial position and result of Axactor SE and the Axactor
Group for the period.
We also conırm to the best of our knowledge that the Board of Directors' Report includes a true and fair view of the development, performance
and ınancial position of Axactor SE and the Axactor Group, together with a description of the principal risks and uncertainties that they face.
Responsibility statement
Oslo, 30 March 2022
The Board of Directors
Merete Haugli
Board member
Brita Eilertsen
Board member
Terje Mjøs
Board member
Lars Erich Nilsen
Board member
Kathrine Astrup Fredriksen
Board member
Hans Harén
Board member
Kristian Melhuus
Chair of the Board
Johnny Tsolis
CEO
Axactor Group24
The foundation of Axactor’s sustainability work
Axactor’s purpose is to help people and companies to a better future,
by helping companies to get paid, in a sustainable manner for the
debtors, enabling further investments and economic growth. Axactor
recognizes that business has a role to play in solving social challenges
through responsible investments, by supporting and developing the
skills of the employees, and by offering innovative products that cater
to customers’ needs. This combines faster payments and respectful
treatment of debtors, brings down outstanding credits, secures a
stronger ınancial market, and increases quality of life for many people
in ınancial difıculties. Through the core business and supply chain,
Axactor create economic value and opportunities for society and
local communities.
Responsible operations are essential for the license to operate and an
enabler of long-term value creation. Sustainability begins from within
the organization, and a clear tone from the top is crucial. To increase
the transparency in its sustainability reporting, Axactor has prepared this
sustainability report in compliance with the Global Reporting Initiative
(“GRI”) standards. This report has been prepared in accordance with
the GRI Standards: Core option.
At Axactor, everyone from the Board through the executive manage-
ment team, and throughout the entire organization, are accountable
for conducting business in an ethical, sustainable, environmentally,
and socially responsible manner. Axactor practices good corporate
governance, respect internationally recognized human rights principles
and supports the UN Sustainable Development Goals ("SDGs”).
Becoming a signatory to the UN Global Compact during 2021 further
emphasizes this and commits Axactor to the ten principles of the
UN Global Compact, in each of the four areas: human rights, labour,
environment, and anti-corruption. To update its stakeholders and
society on its progress in implementing the ten principles, Axactor
needs to annually communicate on its progress about its efforts in a
“Communication of Progress”. This report also incorporates Axactor’s
ırst Communication on Progress (“COP”). The ten principles are all
relected in Axactor’s various Board approved policies, being the
cornerstone of Axactor’s governance structure.
The ten principles of the UN Global Compact
Human Rights
Principle 1
Businesses should support and respect the protection of internationally proclaimed human rights; and
Principle 2
make sure that they are not complicit in human rights abuses.
Labour
Principle 3 Businesses should uphold the freedom of association and the effective recognition of the right to collective bargaining;
Principle 4 the elimination of all forms of forced and compulsory labour;
Principle 5 the effective abolition of child labour; and
Principle 6 the elimination of discrimination in respect of employment and occupation.
Environment
Principle 7 Businesses should support a precautionary approach to environmental challenges;
Principle 8 undertake initiatives to promote greater environmental responsibility; and
Principle 9 encourage the development and diffusion of environmentally friendly technologies.
Anti-Corruption
Principle 10
Businesses should work against corruption in all its forms, including extortion and bribery.
Axactor has a zero-tolerance policy for corruption, fraud, money-
laundering and terrorist ınancing. To safeguard compliance and
support the effectiveness of relevant regulations, the company aims
to maintain an open and ongoing dialogue on these issues, internally
and externally.
The success of Axactor’s business is dependent on the conıdence
earned from the employees, customers, debtors, and investors.
Credibility is gained by adhering to the given commitments, displaying
honesty and integrity, and reaching company goals solely through
honorable conduct.
Sustainability report
Annual report 2021 25
Highlights from 2021
Sustainability has been an integral part of Axactor’s business operations since the foundation of the company back in 2015. During 2021,
Axactor has continued to improve the maturity and awareness within the entire organization and further improved policies, processes,
systems and reporting mechanisms. Below a brief overview of the highlights from 2021, as detailed within the report:
E
Development of a GHG emissions tool initiated
Signiıcantly reduced number of company cars
Focused on waste reduction in ofıces and amongst suppliers
Plastic reduction initiative
Paper waste reduction initiative
Board support to UN SDG #13
Policies and procedures updated to further address and promote climate action and continued environmentally friendly growth
S
Strengthened the understanding of the company’s purpose for all employees
Measured stakeholders’ satisfaction
Eased access to information and ability to pay through digital solutions: QuickPay and debtor portal
Increased focused on sustainable payment plans, in light of the Covid-19 pandemic
Established cooperation with Great Place To Work to measure employee satisfaction
Set further KPIs to measure sustainability performance
Implemented a new group-wide recruitment-tool to increase focus on talent attractions
More courses launched through Axactor Academy
Performance management and development, e.g. mentor- and student-programs
Continued focus on gender equality and diversity
New brand guideline and fonts, to ensure better readability for people with visual disabilities
G
Ethical committee established
Improved vendor management and introduced a Supplier Code of Conduct
New Group risk and compliance tool implemented to improve internal control, risk management, and internal audit processes
Improved anti-money laundering processes and begun implementation of more automated transaction monitoring
New intranet launched; The People Hub
Participated and shared knowledge in relevant forums, e.g. through regulatory watch initiatives in debt collection associations and
responding to EBAs requests for feedback on NPL standard templates.
Improved procedures for customer and portfolio selections
Improved information security and data privacy governance and awareness
Individual policies established on anti-fraud and anti-corruption, anti-money laundering, anti-trust, and trade sanctions
Whistle-blower channel made available to suppliers
Signed UN Global Compact
Axactor Group26
Strategic focus 2022
Axactor’s vision is to become the industry benchmark. A company that delivers the best advice and fairest treatment of debtors, with more
satisıed customers, happier employees and, with high return on investments. Axactor’s values “passion, trust and proactive” help set the direction
and guide the decisions, actions, and the way Axactor interacts with its stakeholders. Axactor is constantly looking for areas in which to continue
to improve, going into 2022, the following areas will be of importance.
E
Implement GHG measurement tool
Improve climate accounts for the Group
Reduce number of company cars
Set emission reduction targets
Support local initiatives to reduce waste and/or emissions
S
Improve debtor complaint management, e.g. through setting further KPIs for debtor complaints and implement a tool for reporting.
Increase number of scorecards for fairer and more efıcient operations
Continue targeted efforts to improve gender equality and diversity
Certify all six countries as a Great Place to Work
Set KPIs for measuring and reporting on employee training hours
G
Strengthen information security, e.g. through network segmentation, mobile device policy, better security analysis tools, early detection
and root-cause mitigation, automatizing of tools and worklows including improved incident reporting, and continuous awareness
Improved regulatory watch: Focus on EU Taxonomy, CSR Directive, CSDD Directive, NPL Directive, etc.
Increased knowledge-sharing
Expand measurement model for portfolios of non-performing loans (NPL) with more input variables capturing current and future
macroeconomic conditions and use of scenarios
Continue to simplify the legal structure
Strengthen preventive and detective measures to combat ınancial crime
Reporting boundaries
Deıning consistent boundaries for sustainability reporting is challenging
due to the complexity of ownership and operational arrangements
in six different countries, including, among others different regulatory
requirements. Axactor strives to be consistent and transparent about
variations in boundaries and provide a complete report in line with
industry practice. Implementation of common reporting systems and
development of common deınitions and reporting standards have
raised the quality of the report, but there are still improvements to be
made e.g. to be able to report correctly on incidents year over year.
Historic numbers are sometimes adjusted due to e.g., changes in
reporting principles, changes of calculation factors used by
authorities, or re-classiıcation of incidents after investigations.
Policies
The Board’s commitment to ensure that the company maintains
good corporate governance standards is explained in the Corporate
governance report, and the commitment to sustainable operations
in this sustainability report. The Board annually review and approve
policies applicable for every employee in the Axactor group, to
ensure that everyone complies with these commitments, and that
the policies are adjusted to changes in the regulatory environment.
The Board approved the following Group policies in 2021 which all
contains elements to ensure sustainable operations:
Quality Legal and compliance Insider
Corporate
governance
Operations Anti-fraud and
anti-corruption
IT and information
security
Delegation of authority Anti-money
laundering
Code of Conduct
Physical security
Antitrust
Procurement
Corporate social responsibility
Trade sanctions
Finance Environmental Treasury
Communication Debt purchase HR
Data protection
Annual report 2021 27
Material issues and stakeholder engagement
Axactor has updated the materiality analysis conducted in 2020 to
ensure the continuous relevance of the material sustainability aspects
identiıed - the areas considered to be the most important for Axactor
and its long-term value creation. The materiality analysis deınes the
challenges and issues that Axactor and its stakeholders perceive as
most important, and where impact on society and the environment is
considered most decisive.
The materiality analysis is based on feedback from external and internal
stakeholders who have responded to and provided comments on
a questionnaire based on relevant topics inspired by GRI standards,
either by survey or through interviews. External stakeholders included
customers, partners, regulators, suppliers, investors, and lenders.
Internal stakeholders included representatives of the Board, the
executive management, and employees. The survey covered key
factors for Axactor’s daily operations and long-term value creation
related to governance, people, and the environment. The focus areas
and associated issues are presented in the materiality matrix below.
The results of the materiality analysis have been substantially the same
for the last two years, which further conırms what the stakeholders
believe Axactor should focus on going forward.
Axactor’s contribution to the UN’s
Sustainability Development Goals
The SDGs were agreed by all 193 UN member states in 2015, and
provide a common guidance for governments, civil society, and the
private sector to help create a better future for people and the planet.
In 2021 Axactor signed the UN Global Compact, which is a CEO
commitment on implementing universal sustainability principles, which
further strengthens the Group’s previous commitments to the SDGs.
Axactor places the SDGs at the core of its business, emphasizing
especially its commitment to the goals below, which underpins the
results of the materiality analysis. Here are a few examples of how
these goals come into action through the daily operations:
Materiality matrix
Importance for Axactor’s stakeholders
Importance to company
Responsible value chain and partnerships
Relationships with regulators and organisations
Innovative and efıcient product offering
Sound economy for our clients
Increase ınancial literacy in society
Environmental footprint
Working conditions
Ethical business behaviour
Ethical collection by treating customers fairly
Data security
Customer privacy
Preventing ınancial crime and corruption
Diversity, non-discrimination and equal opportunities
Talent attraction and retention
Responsible selection of clients and portfolios
Axactor Group28
UN Goal and Axactor main focus area Examples on Axactor’s contribution
5 Achieve gender equality and
empower all women and girls
Why is this important?
Gender equality at all levels in the organization is pivotal to Axactor’s working environment, corporate culture,
skill set, decision-making, as well as debtor and customer service.
The beneıts of a conscious gender balance throughout the organization adds indisputable value, and Axactor
aims to have a gender balance in all managerial teams, within a range of 40%–60%.
What has our contribution been in 2021?
• Continuous development of sustainable people processes with increased focus on embedding diversity and
inclusion practices in them.
• Roll-out of mentorship program focused on developing talents, women have been prioritized when suitable.
• Extensive mapping of pay gaps between men and women, corrective actions completed
where relevant.
• Measure of experience of equity related to, but not limited to, treatment of men and women through employee
survey (Great Place to Work).
• Substantial increase in women in managerial positions since 2020.
8 Promote sustained, inclusive
and sustainable economic
growth, full and productive
employment and decent
work for all
Why is this important?
Sense of achievement and contribution to a bigger whole are fundamental to many individuals’ well-being.
Contributing to decent work for all individuals regardless of any variable that adds to their uniqueness is a
strategic focus at Axactor.
The beneıts of a diverse and inclusive workplace are manyfold, not least to business performance.
What has our contribution been in 2021?
• 20% of employees are under 30 years of age and 14% of employees are over 50 years of age.
• A certain number of positions (variations per country) are reserved for by employees with disabilities.
• Continuous development of sustainable recruitment, development, and promotion processes with focus
on embedding diversity and inclusion practices in them and avoiding bias in any
of these.
• Roll-out of student program that aims to create a cross-border network for students for, among other things,
knowledge sharing.
13 Take urgent action to combat
climate change and its impacts
Why is this important?
Axactor’s business is low-polluting, and not associated with any signiıcant environmental impact. Despite this,
Axactor recognizes that climate change is one of the biggest challenges of our generation. In recognition of this,
Axactor actively takes steps towards reducing its operational emissions and promoting environmentally friendly
behaviour amongst employees.
What was our contribution in 2021?
• Policies and procedures updated to further address and promote climate action and continued
environmentally friendly growth.
• Project to map the Group’s total GHG emissions, going further than current reporting requirements, to start
working more actively towards reducing the Group’s environmental footprint. The project will continue going
into 2022.
• Paper management project in Spain, having the Group’s most paper-intensive operations because of physical
mail requirements: Successfully recycling 12,920 kg of paper. Resulting in saving 180 trees, 11,6 tons of CO2
emissions, 646 m3 of water usage and 26 m3 of space saved in landılls.
16 Promote peaceful and
inclusive societies for sustainable
development, provide access to
justice for all and build efective,
accountable, and inclusive
institutions at all levels
Why is this important?
Axactor’s focus on responsible and sustainable investment is in the larger picture aimed at achieving good long-
term returns with a limited level of risk, while at the same time contributing to complete avoidance of the violation
of fundamental rights.
What was our contribution in 2021?
• Policies and procedures to prevent and detect unethical behavior, fraud, corruption, money-laundering, trade
sanctions, and terrorist ınancing have been established. The company is committed to a zero-tolerance policy.
• Mandatory compliance trainings for all employees.
• Regular and structured audits to identify weaknesses in policies and processes.
• Supplier Code of Conduct signed by all key suppliers, compliance with the code conırmed through a self-
assessment and veriıed through second line controls vendor management.
• Made whistle-blower channel available to suppliers
• Continued unequivocal dedication to being a ınancially stable company, pay taxes and fees,
and employ staff with the knowledge that this encourages the building of accountable institutions at all levels.
• Axactor contributes to the wider community by paying taxes and government fees.
• Ethical committee established.
Annual report 2021 29
Building a viable ınancial system for people and society
The objectives of the Axactor Group are to engage efıciently,
responsibly, and proıtable for investors, customers, debtors, partners,
and employees. Axactor assists in improving cash low, increasing
liquidity, and minimizing the risk for its customers, while also helping
debtors get out of debt through fair debt collection practices and by
providing support and advise throughout the debt collection process.
Axactor builds trust and conıdence through transparency. Strong
ethical values promoting fair treatment of its stakeholders to protect
reputation and company values are essential to the company’s
success. Mechanisms are in place to ensure that employees are aware
of, and updated on policies, frameworks, and procedures to ensure
ethical behavior in all aspects of the business.
Ethical business conduct
The Group’s corporate principles are relected in policies and proce-
dures, which describes how to make decisions, act, and prioritize.
Both while conducting day to day operations, but also in the planning
phase of projects and strategies. Employees should always act in
accordance with the intention of the policies, and not its letter,
always with the highest standards of ethical integrity.
Employees and representatives of Axactor shall always:
x respect human rights, respect the rights of employees and their
representatives, protect the environment, enable fair competition,
and combat ınancial crime
x balance potential beneıts of actions, against the consequences
to society
x incorporate proıtable business with social, ethical, and
environmental goals and actions
x clearly communicate its demands and expectations regarding
corporate responsibility and ethical conduct to employees and
business partners
x have corporate responsibility as a deıning factor when developing
ınancial products and services, and a deıning factor in asset
management operations
x have a transparent management structure in line with national and
international standards for good corporate governance
x have a strong compliance and internal control culture
x only cooperate with customers, business partners and suppliers
who operate in compliance with laws and regulations, good
business practices and who maintains high ethical and
environmental standards
x ensure that all shareholders and other ınancial market players
are treated and informed equally, and that the information is
consistent, reliable, available, and not misleading
Axactor sets clear responsibilities and expectations for its managers,
employees, and partners. This enables Axactor to operate efıciently
with the necessary oversight and control. Effective governance
structures further allow the Group to work smoothly by ensuring
that everyone has a clear understanding of the distribution of roles,
responsibilities, rights, and accountability. The corporate governance
of Axactor complies with formal regulations and generally accepted
best practices as further outlined in the Corporate Governance report
included in the Annual report 2021. In 2021, Axactor also established
an ethical committee with Board level approval, to manage and advice
on ethical considerations – in relation to a variety of topics, such as,
diversity, discrimination, fraud, and corruption.
All new employees are introduced to the Code of Conduct as part of
their on-boarding and signs a declaration conırming that this is read
and understood. Every employee re-conırms this commitment during
their employment.
In 2021, Axactor launched a Supplier Code of Conduct, which the
Group’s suppliers are required to sign. By signing the Supplier Code
of Conduct, the suppliers acknowledge that they, and any of their
afıliates, agents, suppliers, fully comply with applicable laws, and
adheres to internationally recognized environmental, social, and
corporate governance standards. Each supplier’s commitment to the
Axactor Supplier Code of Conduct is reafırmed through regular com-
pliance questionnaires, and where necessary through enforcement of
the audit rights set out in the Supplier Code of Conduct. The Supplier
Code of Conduct includes a link to a whistle-blower channel, which
may be used to report actual or potential breaches to the Supplier
Code of Conduct on the part of the supplier or Axactor.
Whistleblowing
The company has an independent whistle-blower channel for all
employees within the Group, and for its suppliers, to use if they wish
to report censurable, illegal, or unethical conduct. The whistleblowing
channel is easily accessible through the “intranet”, and through a
link in the Supplier Code of Conduct. The whistle-blower channel is
independent and available 24/7. The channel handles reported cases in
local language with integrity, respect, and conıdentiality, also ensuring
the protection of anyone reporting in good faith. The whistle-blower
channel offers full anonymity if opted for and allows users to engage
in written dialogue and to exchange information without losing their
anonymity. Whistle-blower reports are processed in accordance with
the company’s procedures and in line with data privacy regulations.
The Board is informed of all cases reported, the types of misconduct
and measures taken.
2021 2020
Group total
5
6
Three out of the ıve cases in 2021 were upon further inspection
deemed not to be whistle-blower cases and were followed up
accordingly. The remaining two were issues related to the working
environment and operational practices, both considered non-material.
All reports have been followed up in line with protocol, appropriately
investigated and improvements proposed based on the ındings.
Ethical debt collection is an essential part
of a well-functioning credit market
The markets Axactor operates in have clear local varieties in the
way collection processes are done, but the main principles of the
collection activities are quite aligned. This enables the possibility to
set group wide operational targets and KPIs that still are relevant for
the local markets. Axactor is handling volumes in many stages of the
credit cycle throughout the different markets, from invoicing and
pre-collection to legal collection and long-time surveillance. Paired
with the element of debt purchase, Axactor is truly an integrated part
Axactor Group30
of the European credit market. The debt collection industry enables
banks, ınancial institutions, and companies to give credit. Axactor
believes that this responsibility should not be taken lightly, which is
relected in the in the operational policy, where Axactor commits
to giving services of the highest ethical standards always in line with
principles of good collection practices.
In the majority of countries where Axactor operates, debt collection
is strictly regulated through speciıc debt collection acts and regulations,
requiring a license to operate. Many of the ınancial supervisory
authorities and/or associations have additional certiıcation require-
ments for both debt collection companies and their employees.
Axactor has all mandatory certiıcations and licenses in place, and
proactively seeks to certify employees within the debt collection
profession. Further, Axactor is also actively engaged in the local
debt collection associations and was in 2021 represented in various
boards and sub-committees working on speciıc topics, such as new
legislation and statistical reporting. Axactor’s engagement in local
debt collection associations is motivated by its interest in protecting
its own and the industry’s interest, but always with integrity and
through transparent means. Axactor or its employees shall never
mislead or try to obtain information dishonestly through inappropriate
lobbying. In Finland, the application process has started internally to
become a member of the local debt collection association Suomen
Perimistoimistojen Liitto during 2022.
Country Debt Collection Association Membership
Norway
Virke inkasso
Yes
Sweden Svenska inkassoforeningen Yes
Germany Federal Association of German Debt Collectors (BDIU) Yes
Italy UNIREC Yes
Spain ANGECO Yes
Finland
Suomen Perimistoimistojen Liitto
In process
As a listed company, Axactor reports to the market on a quarterly basis.
Adding to the ınancial numbers, Axactor has also set measurements
to ensure that considerations of sustainability are closely linked with
the company’s activities and value creation.
In understanding key stakeholders’ satisfaction with Axactor’s debt
collection services, the following KPIs have been identiıed: debtor,
employee, and customer satisfaction. The feedback from these three
important stakeholders is of the utmost importance to ensure that
Axactor is delivering on their ambitions and continues to always
improve, both in terms of ınancial results but also in sustainability
performance. The overall results from the surveys listed below gives
Axactor conıdence that the commitment to ethical debt collection is
visible both externally and internally.
Provider Survey 2021
Aggregated
group-score
Internal Debtor satisfaction 4.53 out of 5
Ennova Customer satisfaction 8.5 out of 10
Ennova
Net Promotor Score (“NPS”)
50.3
Great Place to Work
Employee satisfaction
72%
Debtor satisfaction survey
The debtor satisfaction survey is conducted via phone after the
debtor has been talking with a collection advisor. The survey is 100%
automized with no human interaction from Axactor’s side. The debtor
is asked three questions related to the service provided in the previous
call and is asked to rate Axactor’s services on a scale from one to
ıve, where ıve is the highest score. Throughout 2021 all countries
Debtor satisfaction survey
0
1
2
3
4
5
SwedenSpainNorwayItalyGermanyFinland
4.69
4.52
4.52
4.59
4.32
4.61
Annual report 2021 31
have been stable at high levels, and Axactor is committed to ensuring
excellent service to all debtors contacting the contact centers.
Customer satisfaction survey
The customer survey is a valuable measurement of the satisfaction
from key executives in Axactor’s customer’s organizations. Axactor
has other customer related KPIs as well that are measured monthly,
whereas the customer survey is conducted on an annual basis. When
comparing the results for Axactor to statistics from the vendor,
Axactor has enthusiastic customers which is in line with the company
vision of being the industry benchmark. All countries have improved
their score compared to the previous survey. The assessment scales
from one to ten, with ten being the highest score.
The second part of the results from the Ennova customer satisfaction
survey is a measurement of the NPS. The NPS is a proxy for measuring
a combination of the customer’s loyalty and satisfaction with the
Axactor brand. The NPS is ranging on a scale from -100 to +100. A
score above zero is positive, and a score of 50 or more is considered
to be excellent.
Employee satisfaction survey
Within the ıeld of human resources, it was decided in 2021 to change
the vendor for the employee survey, to Great Place to Work (GPTW).
One of the main reasons for choosing GPTW is the focus on trust,
relecting one of the three values of Axactor. Trust develops when
managers are perceived as credible, respectful, and fair. This survey
measures the employee’s relations with managers, their job, and their
colleagues. In total, 1,098 eligible employees received the invitation,
and 85.5% responded.
Out of six countries, Axactor managed to certify ıve as a great place
to work in the ırst year of carrying out this survey and are amongst the
highest performers of employers in several markets. It was only Spain
that fell short of reaching the threshold. Spain was fairly close to the
level required to receive the certiıcation, and Axactor will continue
the good work to secure the certiıcation in 2022, also for Spain.
Axactor also measures on speciıc operational KPIs to trace perfor-
mance and adherence to its business practice principles. The results
will in turn be used to improve Axactor’s debt collection services.
Phone collection
Axactor sees it as its responsibility to be available for debtors wanting
to get in contact and is always proactively trying to get in contact with
debtors to ınd sustainable solutions. Upon this background, Axactor
has deıned a group-wide target to achieve an average service level of
answering 95% of all incoming calls to the contact centers. All contact
centers have an automatic call-back function, to call back all debtors
who does not reach the collection advisors, to ensure that all debtors
Customer satisfaction survey
0
2
4
6
8
10
SwedenSpainNorwayItalyGermanyFinland
9.0
8.7
8.6
8.4
7.8
8.8
NPS
0
10
20
30
40
50
60
70
80
90
100
SwedenSpainNorwayItalyGermanyFinland
72.2
50.0
53.8
46.8
26.3
75.0
Axactor Group32
are serviced. Another important measurement is the nuisance rate
when doing calling activities through the predictive mode. The dialer
ensures that Axactor has enough collection advisors to handle the call
volumes distributed by the sophisticated dialer. The overall target is
that the abandoned call rate should not exceed 1%.
The investments made in state-of-the-art contact center technology
and the resource capacity-planning, ensured that Axactor delivered
on the internal targets in 2021.
Service level
(inbound) Target Actual
Nuisance
rate
(outbound) Target Actual
NOR
95%
98.6% NOR
<1%
0.53%
SWE 99.6% SWE 0.36%
FIN 99.0% FIN 0.32%
GER 95.6% GER 0.34%
ITA 93.8% ITA 0.67%
ESP
99.6%
ESP
0.63%
Quality of payment agreements
Another important KPI is the quality of payment agreements and how
sustainable the agreement is for the debtor. The payer-to-payer ratio
measures how many of the debtors that paid the previous month, who
also paid the following month. This is a good measurement over time
to ensure that payment agreements are not made on terms that are
not possible to fulıl.
Year Payer to payer (avg.) Improvement vs. 2019
2019
71.2%
2020 74.2% +4.2%
2021 75.8% +6.4%
The payer-to-payer ratio has gradually improved year-over-year
and shows that Axactor’s investments in training and education of
employees yields positive results.
Digital collection
Axactor has debtor portals in place for all markets to ensure efıciency
and availability for the debtors. Offering digital payment solutions
enables sounder payment lows in the market in a more environmentally
friendly manner. The self-service solution requires debtors to log in
through secure identiıcation methods and gives debtors an extensive
overview of their debt and correspondence, as well as the possibility
to securely start a dialogue with Axactor.
The use of the portal increased during 2021 with more than 600%
compared to 2020, a development which is expected to continue
in 2022. In addition to the self-service portal, a payment solution
called QuickPay is offered in ıve out of six markets. This is an easy-
to-use payment channel where payment information in the ofıcial
correspondence from Axactor may be used to pay outstanding debt.
Axactor Germany started a project during 2021 to utilize the QuickPay
solution, and when launched in Germany, all Axactor markets will
have the payment solution in place.
Segmentation
In 2021, Axactor has continued to mature in the use of advanced
analytics and business intelligence, to build predictable scorecards to
improve collection processes to increase efıciency and good debt
collection practices through advanced segmentation tools, enabling
adjustment of means when approaching debtors. The ability to
identify vulnerable debtors enables Axactor to provide payment plans
and services that takes into account each debtor's unique situation
– in line with Axactor's core values.
Products and services
Further to the above, ethical debt collection is also about the value-
chain of debt collection and ensuring that customers, debt portfolio
sellers, and vendors used by Axactor, are acting responsibly and fully
comply with applicable laws, and adheres to internationally recognized
environmental, social, and corporate governance standards.
Employee satisfaction survey
0
10
20
30
40
50
60
70
80
90
100
SwedenSpainNorwayItalyGermanyFinland
60%
87%
95%
83%
76%
84%
Annual report 2021 33
Management shall ensure responsible investments. No portfolios which
include use of unethical lending terms or aggressive sales methods, or
are considered unethical for other reasons, shall be purchased. Axactor
has structured purchasing processes and sourcing strategies to ensure
that the services and goods acquired are ethical and of high quality.
Axactor shall ensure that suppliers involved in the debt collection
process, such as ıeld collectors, commit to Axactor’s Supplier Code
of Conduct, and that they have implemented sufıcient organizational
and technical information security measures to protect the privacy
of the personal data processed. Only collection agents through the
acknowledged organization LIC are used for international collection.
Axactor’s core business is collecting unsecured consumer debt, mainly
from regulated banks and ınancial institutions. The customers are
chosen primarily due to the quality of the claims, as the customers are
operating under strict regulations and supervision from authorities.
This way, Axactor limits the risk of purchasing, and collecting on debt
not in accordance with its ethical and business practice requirements.
A “know-your-customer” control shall always be conducted before
entering a contract. Customers who represent an unacceptable
reputational or compliance risk shall not be accepted. Axactor places
signiıcant importance on the mutual contractual obligations relating to
ethics and compliance requirements in the value chain. Information on
good debt collection practices, requirements to the collection process
related to information, transparency, guidance, interest rates etc. are
provided to the customers to ensure compliance and high quality
throughout the debt collection process.
The debt collection process is closely governed. Axactor has
developed solid internal control routines in all countries, which is
being monitored by the local compliance teams and internal audit.
Axactor has implemented a debtor complaint process in each country.
A limited number of complaints were received from debtors during
2021, and none were considered critical. All complaints are handled
in accordance with the applicable local procedures; investigated,
answered, errors (if any) corrected, reported, and ıled. In a number
of markets, Axactor is also subject to supervision by the authorities,
which oversees Axactor’s regulatory compliance. Regulatory scrutiny
is expected to increase in all markets in the years to come, especially
considering the NPL directive which is subject to implementation
across EU Member States. Additionally, Axactor’s customers conducts
regular reviews to ensure that Axactor is compliant with its contractual
commitments, regulatory obligations, and the advertised business
practice principles. Where weaknesses are discovered, corrective
measures are implemented. If weaknesses or errors are discovered in
the customer’s process, advice and instructions are also given promptly
to the relevant customer, to always ensure good debt collection
practices are followed. Always with a view to ensure ethical and
responsible value creation throughout the value chain.
Corporate citizenship
Axactor’s strategy is to be close to the community where it operates,
where the country organizations are the hub of the customer
relationships, based on knowing local regulations and market
conditions for customers and debtors.
In addition to its economic and ınancial responsibilities towards its
investors, Axactor also recognizes its social, cultural, and environmental
responsibility in the local communities where it operates. Empowering
the local organizations to adapt an interactional approach to corporate
citizenship, based on mutual trust and transparency. The goal is to
produce higher standards of living and quality of life for the communities
that surrounds them. Axactor believes that this cannot be achieved
strictly by transactional contributions. Success requires proximity,
expertise, and local engagement.
Even more so now, than in the last decade, the above holds true. In the
aftermaths of the Covid-19 pandemic, many of the communities in
which Axactor operates have seen rising unemployment rates and
challenging economic circumstances. In a time where local communities
need to rebuild their economies, Axactor’s mission has become even
more relevant. Axactor’s purpose is to help businesses to a better
future, not only ensuring that they get paid, but also being an aid to
the companies and people with ınancial difıculties, offering
sustainable solutions.
Corporate citizenship is not about ambitions, it is about tangible
impacts and taking a corporate social responsibility. In 2021, the local
Axactor organizations have engaged in a wide array of initiatives,
including amongst others, supporting the lood victims in Germany
Log-ins
0
1,000
2,000
3,000
4,000
5,000
6,000
Dec-21Nov-21Oct-21Sep-21Aug-21Jul-21Jun-21May-21Apr-21Mar-21Feb-21Jan-21
3,861
5,586
4,804
4,546
4,471
4,626
5,285
5,050
5,058
5,496
5,772
5,021
Number of log-ins to the debtor portal(s).
Axactor Group34
through company organized volunteer work and donations, lea
market on old ofıce equipment to the beneıt of the local children’s
hospital, providing facemasks to hospitals in Spain during the Covid-19
pandemic, and supporting local sports teams.
Ukraine
Along with the rest of the world, Axactor watches with dismay at the
unfolding attacks on Ukraine. Axactor has a partnership with a Ukraine-
based IT supplier and employs a limited number of dedicated resources
based in Ukraine. To contribute to the safety and wellbeing of the
people still in Ukraine, Axactor has provided direct ınancial support to
each person, in dialogue with their employer. Axactor has also decided
to support the valuable work of humanitarian charitable organizations
UNICEF and Red Cross, through company donations. Further, the local
organizations of Axactor have contributed through various means,
such as over-time campaigns where the salaries have been donated
to charitable organizations, fundraising campaigns where Axactor
has matched the contributions from the employees with the same
amounts, collecting necessities to refugees, and paid volunteer work.
Privacy protection and information security
Axactor respects the personal integrity of individuals. Different types
of personal data are processed in different ways and situations,
depending on whether a person is the representative of a customer,
vendor or public authority, debtor, employee, job applicant, visitor,
etc. A robust data privacy framework is required when handling
huge amounts of data, including sensitive data related to individual’s
ınancial and, in many cases, vulnerable situations. Protecting the
fundamental rights and dignity of all data subjects of which Axactor
process personal data is crucial to Axactor, and also reiterated in
the Board approved Group’s policy on data protection. As a listed
company and with great respect for the trust given by partners and
investors, Axactor also focus on safeguarding conıdential information
and trade secrets to which Axactor has access. The data privacy policy
and IT and information security policy sets out detailed procedures
and clear roles and responsibilities applicable for all employees within
the Group and are approved by the Board annually. The information
security procedures below have also been reviewed and where
necessary updated.
IT information assets inventory
Backup
Secure software development Remote access
Best practice guidelines for IT &
information security
Data encryption and
communication
Access control and administration Security incident
Antivirus security Information classiıcation
Vulnerability management
Data migration
Policies and procedures have been adjusted to relect the risk situation.
Data protection impact assessments have been established for all
relevant processing activities, art. 30 registers, privacy declarations
and cookie policies updated, retention periods reviewed, efıcient
communication especially with debtors and use of encryption
discussed, data privacy agreements reviewed, and vendor agreements
updated due to the Schrems II verdict.
Regardless of situation, Axactor shall only process personal data in
accordance with applicable data protection regulations. Appropriate
technical and organizational measures are implemented in accordance
with the GDPR and local data protection laws. Continuous attention
has been paid to the integrity of data subjects as many employees still
worked remotely during the year.
Following the minimization principle, only personal data necessary for
the relevant processing is collected, and the personal data should be
processed fairly and lawfully towards the data subjects. To ensure trans-
parency and safeguard the rights of the data subjects, information on
Axactor’s data processing is provided at Axactor’s web pages, in email
and letters sent, in agreements, internal and external communication.
Personal data is deleted when Axactor no longer has legal grounds
for processing, and the purpose of the processing has been fulılled.
Anonymization- and pseudonymization-techniques are used to
remove unnecessary personal data, e.g. during system testing activities.
Axactor process requests from data subjects regarding their rights and
inform about data breaches in a timely manner in accordance with the
established breach notiıcation procedure. The number of complaints
from debtors claiming breach of GDPR due to incorrect registration of
the debtor in public debt register has increased. However, there has not
been an increase in the number of cases where the local supervisory
authority has ruled in favour of the debtor complaining.
Country
No. of inquiries from
the data supervisory
authority
No. of data breaches
reported to the data
supervisory authority
No. of ınes or
corrections by the data
supervisory authority
Norway
1
0
0
Sweden 1 0 0
Finland 0 6 0
Germany 1 1 0
Italy 0 0 0
Spain
9
0
0
Group total
12
7
0
To build a solid security culture Axactor carries out awareness
activities continuously. During 2021, Axactor extensively carried
out initiatives and trainings to all employees, including regular data
privacy and information security awareness trainings, covering both
theoretical and technical aspects. Multiple waves of custom phishing
test campaigns took place in all countries. These exercises aim to
increase the employee’s awareness of potential threats and cyber-
security issues. The results of these exercises are being regularly
analyzed and discussed to identify further improvement areas and
necessary mitigations. Security surveys performed shows a high
average awareness level amongst the employees. Further, business
continuity and crisis management trainings were conducted during
the year, across all countries and at the corporate headquarters.
The group CISO, the security committees, and the data protection
ofıcers, monitor risks, govern compliance, manage incidents and
government data requests, and report on a regular basis to manage-
ment and the Board. During 2021, this process has been complemented
with the implementation of a new Group risk and compliance tool,
implemented in all countries, supporting a more detailed tracking and
follow-up of the internal controls, and risk management process.
Annual report 2021 35
Data processing agreements are entered with all vendors processing
data on Axactor’s behalf. The vendor responsible for most of the
Group’s infrastructure conırms their compliance through independent
third party ISAE 34002 and ISAE 34000 reports. The main vendor for
application operations and IT development is ISO 27001 certiıed.
New technical measures have been implemented during 2021
to strengthen the level of security at Axactor, such as Data Loss
Prevention functionality with a ırst pilot country, and the extension of
Multi Factor Authentication to core internal applications.
In close cooperation with Axactor’s main infrastructure provider,
important projects have been set-up, laying the foundation for the
network segmentation, and for the disaster recovery backup by means
of inter-regional replication to a Dark Site. These are important
measures towards further mitigation of serious risks in case of
generalized attacks, such as ransomware etc.
Access management has been improved through a more integrated
use of the Axactor conıguration management database. Practices and
technology are adopted to preserve conıdentiality, integrity, and availa-
bility of data. Automated internal security scans are performed regularly
within the infrastructure area. A complementary external penetration
test from an independent specialized company commissioned by
Axactor, including advanced testing on Axactor prioritized systems,
is conducted for an additional level of vulnerability identiıcation.
Deviations and data breaches must be reported internally through
the established incident and data breach notiıcation channel. A clear
operational process for security incident and data breach manage-
ment has been implemented, but awareness must be improved and
types of incidents to be reported and follow-up clariıed. Awareness
activities relect the number of reported incidents.
Physical security assessments are performed at all locations to identify
gaps and potential improvements to secure the quality of the processes.
Preventing ınancial crime and corruption
Each year, millions of transactions pass through Axactor, which entails
an inherent risk for ınancial crime. Axactor is committed to comply
with all applicable laws and regulations to combat fraud, anti-money
laundering, bribery, and corruption in the jurisdictions in which Axactor
operates, and to prevent Axactor from being used for any illegal activity.
This also includes complying with all relevant trade sanctions regu-
lations. Axactor has a zero-tolerance attitude. Non-compliance with
policies to prevent ınancial crime may result in criminal or civil penalties
which will vary according to the offence. Axactor prohibits facilitation
payments, kickbacks, or other improper payment for any reason.
Employees are not permitted to give or receive any gifts or other
beneıts that endanger any decision-making process, which should
be based on sound ınancial principles and/or strategic decisions.
Legitimate charitable contributions may be given, but adequate
measures shall be taken to prevent misuse before entering into such
agreements. All donation requires approval from the Group Chief
of Staff. Charitable contributions to political parties shall never be
approved, and no such contributions have been made during the life-
time of Axactor. This also precludes Axactor’s engagement in political
lobbying. Axactor has strict rules for cash management and account-
ing. No invoices, customer, or vendor who lack documented legal
foundation shall be approved. Cash payments should be avoided, and
when exceptionally used, strict procedures must be followed. Axactor
has detailed policies regulating different preventing and mitigating
actions. These Board approved policies are updated annually to relect
the risks identiıed through the annual risk assessments.
Through a “know your customer” procedure Axactor conducts
appropriate checks to avoid entering into agreements with customers
or suppliers involved in any fraudulent, corruptible, money-laundering,
or other illegal activities, or coming from a sanctioned country, and
to prevent any conlict of interest. Axactor has a structured customer
and supplier selection process, to ensure that the selection is based
on transparent and objective criteria, free from personal interests.
Contracts shall contain warranties of compliance to relevant laws,
regulations and business practice principles, hereunder ethical obli-
gations. Axactor encourages competition by ensuring non-discrim-
ination in customer and supplier selection processes, and promotes
use of resources in an efıcient, effective, and ethical manner. Decision
making shall be conducted in an accountable and transparent manner
in accordance with the Delegation of authority policy.
During the contractual period, the quality and quantity of goods or
services received shall be reviewed to verify that the supplier delivers
according to what has been invoiced. Axactor has implemented
a group-wide contract management system, and accounting and
invoicing system, to manage all supplier agreements and invoices in an
appropriate manner. All records should be as complete and accurate
as possible, and timely kept. In 2021, Axactor has further strengthened
its vendor management process with the introduction of a group-wide
vendor management tool. Having good vendor management routines
allows Axactor to monitor its suppliers’ compliance with Axactor’s
requirements, including identifying and following up any gaps. During
the second half of 2021, all of Axactor’s key suppliers were asked to
verify compliance with Axactor’s Supplier Code of Conduct.
Axactor regularly evaluate systems, internal control mechanisms and
procedures, to ensure that they are effective and efıcient. In addition,
appropriate measures are taken to correct any identiıed deıciencies.
All transactions must be executed in accordance with management’s
general or speciıc authorization. Accurate books and records that
fairly document all ınancial transactions, risk assessments and due
diligence shall be maintained and available in case of audits. Financial
authorities across the jurisdictions Axactor operates are interested in
Axactor’s efforts to combat ınancial crime, and Axactor has an open
and active dialogue with its regulators. Employees are encouraged
to report of any suspicions of violations through one of the many
reporting channels. Axactor is committed to follow up all reports of
suspicious acts and take appropriate action. During 2021, there have
been no cases of conırmed fraud and/or corruption within the Group.
Axactor Group36
Country
No. of reported whistle-blower cases
regarding fraud and/or corruption
No. of reported whistle-blower cases
regarding fraud and/or corruption
2021 2020 2021 2020
Norway 0 0 0 0
Sweden 0 0 0 0
Finland
0
0
0
0
Spain
0
0
0
0
Germany 0 0 0 0
Italy 0 0 0 0
Group total 0 0 0 0
Part of the internal audit work is to provide the Board with reasonable
assurance that controls are present and functioning, also from a fraud
prevention perspective. Internal audit has during the year had focus on
risk of misuse of funds and evaluation of the internal control structure,
by evaluating the transactions in the collection system vs. accounting,
auditing the payment process, audit of NPL portfolio post-sale imple-
mentation, and follow-up on observations from 2020. The results
of internal audits are reported to the Board, risks are when identiıed
managed and mitigating actions are always followed up by the Board.
No material ındings were reported by Group Internal Audit in 2021.
Through 2021, Axactor has further simpliıed its legal and ownership
structure to ease transparency, e.g. by merging Swedish and Finnish
companies, prepared liquidation of the Baltic entities, extracted the
Italian portfolios from the SPV-structure to the operational company
and transferred the ownership of this company into the ınancial ring
fence. Additionally, the ownership of the Luxembourg portfolio holding
company has been acquired in full by Axactor. The work on simplifying
the legal structure is still on-going and will continue going into 2022.
People
Axactor is built around three crucial enablers – People, Systems and
Funding. The employees are carriers of the corporate values and
culture, which is vital to Axactor’s success. The concept of how to run
a successful collection business is based on trust and respect for the
individual – customers, debtors, and employees. With the expertise
and dedication of its employees, Axactor can meet stakeholder
expectations. Axactor strives to ensure that it remains an attractive
workplace for its 1243 employees by providing challenging and
meaningful work and by fostering a culture that empowers everyone
to learn and grow. The company sets clear expectations for its leaders
to act as role models who promote the core values, drive customer
centricity, and inspire their employees to succeed by working with
engagement. In Axactor all stakeholders shall be treated with trust and
respect, provided with professional and ethical advice based on their
individual situation. The strong feedback given by debtors, employees
and customers in the satisfaction surveys presented above shows
Axactor dedication.
Strategic goals, policies and procedures coupled to recruiting, devel-
opment and succession of employees are formulated at the Group
level. The operating companies in the Group have a local HR director
managing all HR related matters daily and assisting the management in
respective markets. Fundamental preconditions are also the ability to act
according to laws and regulations coupled with labour law and the work
environment and the group-wide policies, local procedures, and collec-
tive agreements. During the year, all HR processes have been reviewed.
The People Hub
Correct, easily accessible and comprehendible information is vital
to stay compliant and have efıcient operations. A continuous focus
on new and effective ways to communicate and share information
is needed, to ensure that the right decisions are taken and that the
employees continuously develop their competencies to be able
to deliver the best possible service to the customers and debtors,
Axactor has during the year implemented a new intranet, the “People
Hub”. This also to mitigate the request from the employees for more
information, as highlighted in the employee survey.
Equality and diversity
Axactor invests long-term efforts in creating an inclusive work climate
and increasing diversity. The ambition is that the employees in the
organization will relect society at large. A good mix of competencies
and perspectives creates better results for the entire operation.
Axactor has zero tolerance towards discriminatory behaviour and
does not tolerate discrimination based on age, gender, pregnancy,
parental leave, ethnicity, political opinion, philosophy of life, func-
tional ability, religious beliefs and/or sexual orientation, or any other
characteristics. The culture and work environment are to be inclusive,
with a fundament of mutual respect and appreciation of the beneıts
that arise from different backgrounds, competencies, and experiences.
Employees at all levels are encouraged to voice their opinion or
concern when something is not right or does not feel right. Different
opinions shall always be respected, and people are encouraged to
question the decisions of others.
At Axactor, everyone shall be treated with fairness and respect. Team
spirit, mutual trust and a respectful attitude are important factors of
the Group’s success. It is the responsibility of management to lead
by example, setting a clear tone-from-the-top, to ensure that all
employees are aware of these principles and behaves accordingly.
The employees have through the employee satisfaction survey
conırmed that they are treated fairly, regardless of their age, race or
ethnic origin, gender, and sexual orientation.
Axactor aims to have an even gender balance in all managerial teams,
where genders are represented within a range of 40%–60%. Gender
balance per country 2021:
Annual report 2021 37
Gender balance per country
2021 2020
Number Women % Men % Number Women % Men %
Finland
48
67%
33%
63
76%
24%
Germany 183 67% 33% 225 66% 34%
Italy 120 80% 20% 123 76% 24%
Norway 130 53% 47% 136 54% 46%
Spain 692 65% 35% 640 64% 36%
Sweden
70
71%
29%
48
65%
35%
Group total 1,243 66% 34% 1,235 65% 35%
Examples of measures to increase diversity, has included ensuring job
listings for vacant positions are written in an inclusive manner and to
attract more women to leadership positions. In 2021, Axactor continued
to include diversity and inclusion leadership development courses for
new managers and as part of leadership development activities in all
countries. Overall, the company employed 66% women and 34%
men at the year-end 2021. The percentage of women in the country
management teams has increased from 37% to 44% in 2021, building
upon an increase in 2020 from 29% to 37%, entailing a 15% increase
over the course of two years. Furthermore, leadership positions
below country management level have a majority of women, at 54%.
Axactor has not yet achieved a more balanced gender distribution
across all levels, business functions and countries, but continuous
efforts are giving tangible results.
Gender balance number of employees in %
2021 2020 2019
Number Women % Men % Number Women % Men % Number Women % Men %
Board of Directors
6
50%
50%
7
43%
57%
6
50%
50%
Executive management incl. CM 12 42% 58% 13 31% 69% 13 31% 69%
Country management all countries 39 41% 59% 43 37% 63% 45 29% 71%
All other managers 160 57% 43%
All Group employees
1,243
66%
34%
1,235
65%
35%
1,200
63%
37%
Axactor offers job opportunities to individuals with disabilities. In 2021,
2% of Axactor’s employees in Spain were employees with a disability
grade of more than 33% and 7% in Italy were employees with a
disability grade of more than 46%. All ofıces are universally designed
to accommodate employees with disabilities. In the spring of 2022,
Axactor in Spain will move into new premises designed to better
accommodate employees with disabilities.
Hiring students provides young academics access to employers
that provide relevant work experience and increases employment
in groups that can ınd themselves outside today’s labour market.
Axactor offers students different job training opportunities in all
countries where it operates. The aim is to support the company’s
succession and competency planning, and to promote gender
equality and diversity. As part of the training, each student works at
Axactor full-time or part-time, takes relevant professional develop-
ment courses and learns about the Axactor culture. Several students
are offered jobs in Axactor, while others gain a valuable experience
for their CVs. There are many country-speciıc initiatives to promote
student participation in work life, one of which is that Spain has an
agreement with the university offering students practical experiences.
Furthermore, there are several students that are doing practical
work for vocational studies and work part-time across the Group.
Axactor also has measures in place that help to ensure that older
employees can continue working also after retirement age.
The measures vary between countries. It includes the possibility
of reduced working hours and extra holidays. Out of Axactor’s
1,243 employees, 29 are over the age of 60 years.
Age distribution Group total
0
50
100
150
200
250
65-6960-6455-5950-5445-4940-4435-3930-3425-2920-2415-19
Number of employees per age
2021 2020
Axactor Group38
Equal pay for equal work
Axactor’s remuneration policy states the principle of equal pay for
equal work or work of equal value. From a gender equality and a legal
perspective, it is important to monitor the development of differences
in pay between men and women. Axactor is working systematically to
ensure equal pay for equal work or equal value and to rectify unwar-
ranted pay differences between women and men. Annual analyses are
performed by all countries to facilitate discussions with management
and the local unions where applicable on pay gaps. Axactor works
closely with relevant managers in the organization to ensure fair and
equal pay, to raise awareness and ensure correct salary levels are set.
Axactor has continued the work in developing a job framework across
all countries, to support identiıcation of comparable roles, compe-
tences, and expectations, as well as ongoing work on fair and equal pay.
The Board’s remuneration for 2021 differentiates between the responsi-
bility and types of committees, not men and women – setting the tone
from the top. The remuneration for executives reporting to the CEO
have been harmonized, local market conditions and responsibilities
considered. The work to reduce the gender pay gap will continue
until the gender pay gap has been closed.
Axactor complies with applicable collective bargaining agreements.
A normal principle with a ıxed percentage for salary increase for
all employees will be challenged as it increases already identiıed
differences. There are more men in the company's top positions, more
women in support functions as e.g. HR and more women in part-time
positions. However, these challenges are not hindering Axactor in
achieving the goal of closing the gender pay gap. Gender pay gap
analysis for Axactor:
Salary difference women vs. men, all employees by country % 2021
Finland
-30%
Germany -24%
Italy -46%
Norway -26%
Spain -28%
Sweden
-16%
Group total
-28%
Number Men Women Men % Women % Salary difference %
Board of Directors 6 3 3 50 50 (19)
Executive Management 12 7 5 58 42 (20)
Country Management (excl. Country Managers)
39
23
16
59
41
(18)
All other Managers
160
69
91
43
57
(24)
All Group employees
1243
424
819
34
66
(28)
Gender balance, management
%
0 20 40 60 80 100
All other
managers
Country
management
all countries
Executive
management
incl. CM
Board of
Directors
Women Men Target
50
42
41
57
50
58
59
43
Annual report 2021 39
Salary difference CEO vs. average base salary of all employees.
CEO Salary Average salary per employee
EUR 405,000
EUR 37,434
Talent attraction and retention
It is important for Axactor to attract and retain skilled employees. The
recruitment process is a valuable opportunity to present a positive
image of Axactor as an employer. Career pages have been developed
for all countries. Axactor strives for objectivity in its recruitment, and
extensive work has been carried out to harmonize and professionalize
the recruitment process. Upon this background, Axactor Spain has
introduced an initiative they have branded the “blind CV” in the local
recruitment process, to limit bias by removing identiıers such as
gender, nationality, and age.
Furthermore, internal recruitment and promotion are very positive
and beneıcial. All job vacancies are advertised internally. Managers
encourage employees to actively apply for new positions in the
Group, and Axactor’s internal mobility program helps to retain crucial
expertise, promote Axactor’s culture and contribute to internal career
development. In 2020 a recruitment process with more digital system
support was implemented as a part of the Groups new HR-system, and
this process has been further developed and improved during 2021.
Succession planning is crucial to satisfy the current and future demand
for managers and specialists. One important task for managers at
Axactor is to identify, encourage and develop new managers and
specialists. To prepare prospective managers, mentor programs are
carried out focusing on developing leadership skills, change manage-
ment, and developing the business model. Managers at Axactor must
be act as ambassadors for the company’s corporate culture, one of the
reasons for which managers are often recruited internally. To ensure
success in the work on developing and attracting employees Axactor
monitors the development of new hires and employee turnover.
The Group employee turnover rate for 2021 was 31.3%, which was
substantially higher than in 2020. This is due to organizational restruc-
turing to optimize organizational operations, such as homeshoring the
backofıce functions in the Baltics and closing of 1 site in Norway, 3 sites
in Spain and the ıeld collection service in Germany. The restructuring
processes were all performed in compliance with local law and
regulations and Axactor’s organizational restructuring procedure.
Furthermore, thorough analysis and continuous improvement of the
different elements of the employee journey at Axactor is conducted
regularly to contribute to retention.
Employee turnover by country and gender, %
1)
2021 2020
Total % Women % Men % Total %
Finland
43
26
50
12
Germany 32 48 24 10
Italy 31 49 26 12
Norway 28 27 28 16
Spain 33 42 28 10
Sweden
9
16
5
22
Group total
31
40
27
11
1) Employee turnover refers to the proportion of permanent employees who have left the company in relation to all employees in 2021 including voluntary turnover, retirement,
death, dismissals, organization changes and efıciency.
Organisation
2021
Number of new
employees Women % Men %
Axactor Finland 8 50 50
Axactor Germany 26 62 39
Axactor Italy
36
22
78
Axactor Norway
27
48
52
Axactor Spain 270 42 59
Axactor Sweden 28 21 79
Axactor Group 395 40 60
Continued learning and development
It is important to Axactor that employees can develop in their roles,
and it is stated in Axactor’s HR policy that the company is committed
to continuous professional development of its employees.
The Axactor Academy is the Group’s own centre for learning and
development. All employees have the right and obligation to training
and competence development. Axactor Academy provides the
organization with a streamlined structure to manage the competence
development for all employees. All employees receive training to
secure compliance to relevant laws and regulations such as debt
collection regulations, tax and ınancial regulations, anti-fraud and
anti-corruption, data privacy, information security, anti-money
laundering and terror ınancing and other business ethical standards.
Axactor Group40
Employees are also provided with training that gives them the tools
with which they can give customers or debtors a positive experience,
for instance through in-depth knowledge of the relevant collection
processes they work with, and comprehensive communication
training. Employees are also offered various e-learning courses
throughout the year, some of which are mandatory. Axactor strives to
be transparent and report on trainings, and for the purpose of creating
a foundation to build upon next year, preliminary statistics have been
prepared, detailing the statistics from e-learning courses through the
Group HR system:
Courses
Country Number of courses
Finland
49
Germany 70
Italy 101
Norway 52
Spain 129
Sweden
57
Group total
338
Participants
Courses completed by employee
Quantity of employees
(without duplicates)
15-22 12
10-14 84
5-9
556
1-4
756
Total
1,408
Participants per course
Country
Quantity of courses
(completed/undergoing) Course per employee
Finland 319 5.15
Germany 1,021 4.40
Italy
925
6.61
Norway 361 3.57
Spain 3,582 4.59
Sweden 458 4.92
Average
4.87
Hours spent
Country
Average time (h) spent on
training per employee
Finland 6.8
Germany 9.6
Italy 19.8
Norway 6.5
Spain
16.3
Sweden
18.0
Group total
27.4
Average time spent on training per employee Average time spent on training per employee with Junglemap
13.2 hours 14.2 hours
Annual report 2021 41
Axactor’s managers are held to a high standard and are offered a
variety of courses through Axactor Academy. Managers are expected
to act in accordance with the different elements of Axactor’s
leadership platform – strategic direction, leadership principles, and
corporate values. Managers are offered trainings in a combination
of on-the-job-training, sharing of best practices and knowledge,
e-learning, classroom training and mentorship programs. Learning and
development objectives for both managers and employees are linked
to Group-wide organizational objectives.
In accordance with the performance management process at
Axactor, performance appraisals, including the establishment of new
development goals, are conducted annually between all employees
and their immediate managers. The completion rate of these
performance reviews is close to 100% at all levels of the organization.
Employee’s motivation, development and continuous feedback are
also secured through structured and regular “check-ins”.
Axactor has worked systematically to develop its organization and
culture. The efforts over the last years have been directed towards
securing a global people management system, developing consistent
performance management practices, leadership development efforts
to underpin trust-based leadership, mentoring programs, student
programs and an evaluation of the “employee journey” through an
assessment of the HR processes. All these initiatives are aimed at
creating common structures and further strengthening the trust-based
culture. To verify this, Axactor has partnered with world-leading
employee survey supplier Great Place To Work. The majority of
Axactor’s employees participated in the survey, as provided set out
above. Although it is rare to achieve the certiıcation the ırst year of
running the survey, all countries besides Spain achieved the “Great
Place To Work”-certiıcation. Spain too delivered impressive results,
considering the restructuring process conducted in 2021 and the
severe consequences of Covid-19. The feedback from the employees
show that Axactor has an effective, rational, and competent organi-
zation with a clear strategy. The management set clear expectations
and the employees have high trust in management. There is an
open dialogue where straight answers are given. There are no signs
of discrimination due to sex, religion or the like nor experiences
of sexual harassment. Employees are proud to work for Axactor.
Identiıed areas with improvement potential are internal information
sharing, employee involvement in decision making, recognition of
achievements, focus on middle management, renumeration and
lexibility. Axactor will continue to work to strengthen performance
management, succession planning and increase focus on leadership
development going forward.
Remuneration and beneıts
The main purpose of the company’s remuneration is to encourage
a strong and sustainable performance-based culture which supports
growth in shareholder value over time, based on responsible business
practices and aligned with company values. This is stated in the
Group’s remuneration policy, determined by the Board and approved
by the general meeting.
To attract and retain employees, Axactor offers competitive employment
terms in line with local market conditions. The individual salaries are set
and adjusted by managers and approved in accordance with the
grandfather principle, after which they are communicated to each
individual employee in the annual salary review dialogue between
manager and employee. Conditions and beneıts differ within the
Group and are adapted to the markets where the company operates
and to the collective agreements which have been entered. Axactor
has entered collective bargaining agreements in Sweden, Finland,
Norway, Italy, and Spain. Ca. 69% of all employees are covered by
collective bargaining agreements. Axactor has also offered employees
in Germany the opportunity to sign up for collective bargaining agree-
ments. Axactor commits to the International Labour Conventions
on the freedom of association and the right to collective bargaining
among its employees and has constructive discussions and collabora-
tion with the unions. The collective bargaining agreements regulate,
among other things, salaries, terms of employment such as notice
period. Axactor collaborates well with the unions and facilitates their
work by offering use of Axactor ofıces and equipment for Axactor
union related work. The Group has established a European Works
Council with representatives from all countries in which issues and
topics that have cross-border relevance are addressed. Axactor has
also established networking and afınity groups across the organi-
zation, to ensure employee’s involvement and knowledge-sharing
between the countries.
Axactor recognizes the importance of work-life balance, which is
supported through various initiatives, e.g. accommodating for a sub-
stantial number of part-time employees, most of which are women.
To Axactor’s knowledge, all part-time work is voluntary and is largely
related to students working in combination with studies, employees
with reduced capacity, and mothers with younger children requesting
part-time work after maternity leave. In Italy the amicable and ıeld
collection advisors work part-time, 6 hours per day on shift from 8 to
20. This has been part of a restructuring project of 2018, where the
affected employees voluntarily accepted the part time reduction.
However, in accordance with its commitment to the SDG #5, Axactor
aims to decrease the number of part-time workers. An important
means to this end is the continued focus on the development of
female employees, the encouragement of them taking opportunities
when given and facilitating a good work environment for talented
women. The form of employment is expected to be a topic in all per-
formance appraisals, and leaders are encouraged to work with part-
time employees to ınd other accommodations that can contribute
to minimizing the need for part-time work. Axactor Spain has shown
dedication to the reduction of part-time employees through various
initiatives, one of which is entering into agreements with day-care
centres and toy nurseries that give Axactor employees discounts and
therefore an increased possibility of working full-time.
Other beneıts such as pensions advice, salary exchange, ıtness
subsidies follow market conditions and best practice in each of the
countries and apply equally for all employees in country regardless of
form of employment and percentage of employment. In Norway and
Sweden for instance, Axactor offers e.g. maternity and paternity pay
greater than the statutory requirement.
Axactor Group42
Employees by form of employment, 2021:
Employees by form of employment
2021 2020
Number Women % Men % Number Women % Men %
Regular employment
- Full time 863 63 37 920 63 37
- Part time 204 80 20 237 78 22
Temporary employment 176 63 38 78 58 42
Group total
1,243
1,235
Axactor shall offer a working environment where it is possible to combine work, career, family life and spare time. An important element is the
possibility to take parental leave.
Country
Maternity leave
# of women
# of weeks of
maternity leave
Paternity leave
# of men
# of weeks of
paternity leave
Norway 9 223 3 25
Sweden 11 138 2 2
Finland
6
167
2
7
Germany
8
293
2
12
Italy 14 248 2 2
Spain 21 241 13 99
Group total 61 1,017 22 135
The parental leaves were taken without any restrictions or conse-
quences for the remuneration, beneıts, or work tasks of the employee.
With reference to the statistics presented above, the company
considers itself compliant with the reporting obligations pursuant to
the Norwegian Equality and Anti-Discrimination Act section 26.
Health and work environment
Axactor continuously addresses risks and opportunities related to
the workforce. To sustain a workplace that is healthy and safe – both
physically and mentally – Axactor builds its efforts on an active working
environment, councils, and engagement initiatives, as well as collabo-
ration with unions, employee representatives and local management.
Axactor does not engage in and expressly prohibits any kind of forced-,
compulsory- or child labour in all its operations, including those
serviced by suppliers. A continuous and trust-based dialogue between
managers and their employees makes it possible to detect early signs
of poor health and to ensure the work situation is sustainable in the
long run. This is done systematically across the Group through
structured annual appraisal talks and regular “check-ins”.
Working actively to facilitate a positive work environment, Axactor
encourages employees to be physically active and take care of their
health. There are several initiatives in all countries and ofıces to pro-
mote employees’ health, e.g., initiatives to facilitate cycling to work,
sponsoring of health club membership, common training for groups of
employees, physiotherapist availability in the ofıce on a regular basis,
football games, annual culture and value events dedicated to physical
and mental health, and local health insurances.
Axactor does not accept any form of sexual harassment. Speciıc focus
to raise awareness is given through, e.g. the digital ethical e-learning
courses mandatory for all employees to conduct. Axactor has not
received any whistle-blower reports on incidents of sexual harassment
and the result from the employee satisfaction survey conırms that this
is not a challenge within Axactor.
No. of whistle-blower reports
concerning sexual harassment
No. of reported cases resulting in
disciplinary and/or criminal sanctions
Country 2021 2020 2021 2020
Norway 0 0 0 0
Sweden 0 0 0 0
Finland
0
0
0
0
Spain
0
0
0
0
Germany 0 0 0 0
Italy 0 0 0 0
Group total 0 0 0 0
Annual report 2021 43
All managers have access to tools to be able to act upon early signs
of ill-health among employees and increase the work attendance rate
through proactive wellness initiatives. Furthermore, Axactor monitors
the sick-leave trends, through local HR processes.
Axactor has established a European Works Council with representa-
tives from all countries elected by the employees for two years at a
time. It is a forum for information and discussions for the employees in
the Group. Representatives from the executive management provides
a status of the company at least twice a year. The agenda covers the
structure of the Group, the ınancial and the economic situation and
envisioned developments, anticipated progress of the business, sales,
signiıcant changes to any area within the Group’s company structure,
transfer of undertakings, mergers, cutbacks or closures of undertakings,
personnel policies of the Group and equality between men and
women (as well as minorities) in the Group.
The well-being of the employees is a key factor in relation to
Axactor’s ability to recruit, develop and retain a diverse and motivated
workforce. It is only with such a workforce that Axactor will be able
to continue to provide an even better service to the customers and
debtors in future. Axactor recognized that quality, health, and safety
are integral aspects of the company’s operations, and systems are in
place to monitor and follow up accidents and/or incidents. Axactor’s
business is by nature non-hazardous.
No. of workplace injuries recorded
No. of serious or fatal workplace
injuries recorded No. of commuting injuries recorded
Country 2021 2020 2021 2020 2021 2020
Norway 0 0 0 0 0 0
Sweden 0 0 0 0 0 0
Finland
0
0
0
0
0
1
Spain
0
0
0
0
13
7
Germany 0 0 0 0 0 0
Italy 0 0 0 0 1 0
Group total 0 0 0 0 14 8
Combatting climate change
Axactor shall have a cautious and conscious approach to its envi-
ronmental impact, and the environmental and climate impact from
business operations is of ever-increasing importance for stakeholders
and society. Axactor’s operations are by nature low-polluting and
relatively harmless to the environment. At the same time, Axactor
recognizes that the responsibility to combat climate change is shared,
and the company has since its foundation worked actively to minimize
its environmental footprint. Axactor’s environmental commitments
follows from its environmental policy, which is adopted annually by
the Board. Further, the principles set out in the environmental policy
is also relected throughout the rest of the policies and corporate
governance structure.
Axactor’s risk management system requires the group to identify,
assess and document environmental risks and opportunities. An
environmental risk assessment is conducted annually with high risks
expected to be mitigated through the ordinary risk management
process, and opportunities should be elevated to the executive
management for further evaluation. Additionally, an internal climate
risk assessment of Axactor’s locations have been conducted, showing
limited climate related risks.
Environmental aspects are included in considerations for relevant parts
of the value chain and investments. To ensure this, Axactor has a struc-
tured purchasing process and sourcing strategies to make sure that ser-
vices and goods acquired are provided from suppliers with acceptable
environmental standards and use products and services that represent
the lowest total impact on the environment. Axactor further ensures its
suppliers’ commitments to its environmental expectations, through the
prerequisite to sign Axactor’s Supplier Code of Conduct.
The main source of Axactor´s emissions are generated through
consumption of energy in the company´s ofıces and through business
travel. The single largest source of energy consumption within Axactor
is the servers and data centers, which are run by Axactor’s infrastructure
partner. In 2021, all the servers are run by the same infrastructure vendor,
to among others lessen the environmental impact. This infrastructure
provider is certiıed as a green light house, operating with 100%
renewable energy. Requirements and guidelines to encourage the use
of energy-efıcient and space-saving properties are deıned, and Axactor
is working continuously with the property owners to adopt energy
conservation measures in the buildings where it operates. Additionally,
initiatives are made to actively reduce the need for physical meetings
to reduce travel and encourage a more time-efıcient use of resources.
Below, the Group’s measured emissions for 2021:
Category Subcategory Unit of measure User data kg CO2e/unit Emissions total Prosentage emission
Scope 1
Company cars
Liter
89,765
2.7
240,250
28%
Scope 2 Electricity usage kwh 1,293,121 0.4 467,254 55%
Scope 3 Flights and hotel nights N/A NA NA 144,031 17%
Total emissions 851,534 100%
Axactor Group44
With regards to energy consumption, all Axactor ofıces have systems
for smart controlling and monitoring of ventilation, heating/cooling
and lights. No relocations or reconstruction of existing ofıces shall
lead to higher energy consumption per m. In 2021, the Group’s
subsidiaries in Norway and Germany relocated to brand new ofıces,
compliant with applicable energy use requirements. This is expected
to lead to a reduction in energy costs per m in both countries, visible
in the climate accounts from 2022.
Axactor’s travel procedure speciıes that employees are encouraged to
limit travel whether to the ofıce on day-to-day business or for business
travels and use tele-/video conferencing to avoid unnecessary travels.
At the same time, due to the company’s international operations, some
level of travelling is to be expected. Axactor strives to lower the travel
ratio and aims to choose less emission intensive travels where possible.
In respect of company cars, Axactor has limited use of company cars
and incentivizes the choice of low emission vehicles. It is mandatory
to select models/speciıcations that have a lower-than-average fuel
consumption and emission for its class, according to in the World Light
Vehicle Test Procedures (“WLTP”), however it is strongly encouraged to
choose an electrical vehicle. During 2021, the number of company cars
have been reduced with 29 cars. Axactor aims to reduce the number of
company cars going forward, and the tendency is visible year-over-year,
pursuant to the table below.
No. of company cars
Country Per 31.12.2021 Per 31.12.2020 Change
Norway
1
5
(4)
Sweden 4 6 (2)
Finland 1 1 0
Spain 26 26 0
Germany 14 35 (21)
Italy
10
12
(2)
Group total
56
85
(29)
Further to reducing greenhouse gas emissions, Axactor is also
committed to reducing waste. The general waste hierarchy is to ırst
reduce waste at the source, secondly to reuse items if possible, and
thirdly to ensure that items not possible to reuse are recycled. The
procurement policy shall ensure that all purchases are in line with envi-
ronmentally friendly considerations regarding selection of vendors,
products, and volumes. All ofıces have recycling of paper and systems
for waste sorting to secure proper handling. Not all ofıces have
systems for recycling or ensured environmentally friendly destruc-
tion of used electronic ofıce equipment and some do not offer to
handle employees’ private IT waste. Where possible, Axactor strives
to partner only with certiıed IT suppliers, being obliged to ensure
recycling of IT-equipment and seek efıcient and environmentally
friendly alternatives for sourcing, packaging, and transportation. Both
of Axactor’s largest IT suppliers are certiıed and has such systems in
place. Further improvements concerning waste handling and recycling
across all ofıces are planned to continue, going into 2022.
In 2020, Axactor started to measure and report on greenhouse gas
emissions for a set of speciıc categories. Axactor has continued
building on this bedrock during 2021, with the aim to signiıcantly
improve its climate accounting for 2022. With assistance from climate
mitigation consultants, Axactor has initiated the development of a
greenhouse gas emission tool. The tool will enable Axactor to better
understand and identify its emission sources, enabling the identiıca-
tion and concretization of appropriate mitigating actions, to further
reduce the Group’s greenhouse gas emissions going forward. This
initiative also aims to prepare Axactor to set science-based targets in
the future, in support of the goal to limit global warming to 1.5°C, to
prevent the worst effects of climate change, in accordance with the
Paris Agreement. This also supports Axactor’s ambition to continue
to meet the stakeholder’s future expectations, by delivering on the
promise of sustainable economic growth.
Additionally, the project is also considered important to prepare for the
ever-increasing regulatory requirements – statutory as well as “volun-
tary”. The latter with reference to sustainability rating agencies, credit
rating agencies, banks, green bonds, etc., which comes with separate
requirements, not imposed by governments, but which may still offer
both opportunities and threats for the Group. Regarding statutory
requirements, Axactor is carefully monitoring the developments in
relevant markets. Axactor strongly supports the European Green Deal,
and its ambition for the European Union to become climate neutral by
2050, at the same time acknowledging the challenges that comes with
it. By 2030, the European Union’s aim is to reduce greenhouse gas emis-
sions by at least 55% and achieve climate neutrality by 2050. There is
no doubt that this is an ambitious goal, which will fundamentally change
the level of effort and expertise required in all EU based companies
regarding environmental compliance in the years to come, being an
important driver also for Axactor. Speciıcally, being the cornerstone of
EU’s sustainable ınance strategy, Regulation (EU) 2020/852 (Taxonomy)
aims to create a framework to facilitate sustainable investment. The
Taxonomy Regulation currently has a limited impact on the debt
collection industry, but it is expected to play an increasingly important
role going forward, at which point Axactor will be prepared and able to
act in the best interest of the Group and its investors.
Further to the group-wide initiatives, Axactor strongly supports
and encourages local environmental initiatives, based on a belief
that everything helps. Axactor believes that businesses that actively
engage with the shifting context around them, and strive to be part of
the solution, will be the ones that prosper in the long term.
Annual report 2021 45
GRI Index
GRI standard:
Disclosure: Reference chapter (include page):
101 This report has been prepared in accordance with GRI Standards
Core option
Sustainability report: page. 25
Organizational proıle
102-1 Name of the organization Front page
102-2 Activities, brands, products, and services Axactor at a glance: page. 4
102-3 Location of headquarters
Note 1: page. 71
102-4 Location of operations
Axactor at a glance: page. 4
Our presence: page. 5
102-5 Ownership and legal form Corporate governance report: page. 48
Shareholder information: page. 61-62
102-6 Markets served Axactor at a glance: page. 4
Our presence: page. 5
Report of the Board of Directors: page. 14
102-7 Scale of the organization Axactor at a glance: page. 4
Our presence: page. 5
Key ıgures 2021: page. 11
102-8 Information on employees and other workers Sustainability report: page. 38-40, 43
102-9 Supply chain Axactor at a glance: page. 4
Report of the Board of Directors: page. 15-17
102-10 Signiıcant changes to the organization and its supply chain Highlights of the year: page. 9-10
Letter from the CEO: page. 12
Report of the Board of Directors: page. 15-17
102-11 Precautionary principle or approach
Sustainability report: page. 33-34, 44-45
102-12 External initiatives Sustainability report: page. 25
102-13 Membership of associations Sustainability report: page. 31
Strategy
102-14 Statement from senior decision maker
Letter from the CEO: page. 12
Ethics and integrity
102-16 Values, principles, standards and norms of behavior
Our values: page. 7
Our purpose and vision: page. 8
Sustainability report: page. 30
102-17 Mechanisms for advice and concerns about ethics Sustainability report: page. 30
Corporate governance report: page. 53
Governance
102-18 Governance structure Corporate governance report: page. 51
Board of Directors: page. 55-56
Management: page. 57-60
Stakeholder engagement
102-40 List of stakeholder groups Sustainability report: page. 28, 30
102-41 Collective bargaining agreements Sustainability report: page. 42
102-42 Identifying and selecting stakeholders
Sustainability report: page. 25
102-43 Approach to stakeholder engagement Sustainability report: page. 28, 31-33
102-44 Key topics and concerns raised Sustainability report: page. 28
Axactor Group46
Disclosure: Reference chapter (include page):
Reporting practice
102-45 Entities included in the consolidated ınancial statements Note 2: page. 71
102-46 Deıning report content and topic boundaries
Sustainability report: page. 27
102-47 List if material topics
Sustainability report: page. 28
102-50 Reporting period Front page
102-51 Date of most recent report This is the ırst GRI-based report by Axactor
102-52 Reporting cycle Annually
102-53 Contact point for questions regarding the report vibeke.ly@axactor.com
102-54 Claims of reporting in accordance with the GRI standards
Sustainability report: page. 25, 28
102-55 GRI content index Page. 46-47
Topic speciıc disclosures:
Disclosure: Reference chapter (include page):
103: 1-3 Disclosure on management approach Sustainability report: page. 28
Corporate governance report: page. 48-54
205-1 Operations assessed for risks related to corruption Report of the Board of Directors: page. 22
Sustainability report: page. 36-37
Corporate governance report: page. 53
205-2 Communication and training about anti-corruption policies
and procedures
Sustainability report: page. 36-37, 40-41
Corporate governance report: page. 53
205-3 Conırmed incidents of corruption and actions taken Sustainability report: page. 37
302-1 Energy consumption within the organization
Sustainability report: page. 44
305-1 Direct (scope 1) GHG emissions
Sustainability report: page. 44
305-2 Energy direct (scope 2) GHG emissions Sustainability report: page. 44
305-3 Other indirect (scope 3) GHG emissions Sustainability report: page. 44
401-1 New employee hires and employee turnover Sustainability report: page. 40
403-2 Types of injury and rates of injury, occupational diseases,
lost days of absenteeism, and number of work-related fatalities
Sustainability report: page. 44
404-1 Average hours of training per year per employee Sustainability report: page. 41
405-1 Diversity of governance bodies and employees Sustainability report: page. 38-40
405-2 Ratio of basic salary and remuneration of women to men
Sustainability report: page. 39
406-1 Incidents of discrimination and corrective actions taken Sustainability report: page. 43
418-1 Substantiated complaints concerning breaches of customer
privacy and losses of customer data
Sustainability report: page. 35
419-1 Non-compliance with laws and regulations in the social and
economic area
Corporate governance report: page. 22
Report of the Board of Directors: page. 53
Annual report 2021 47
Axactor SE is a Norwegian SE-company (Societates Europaeae) listed
on the Oslo Børs and bases its corporate governance structure on
Norwegian legislation and recommended guidelines.
Axactor is committed to good corporate governance standards which
contributes to optimizing the value creation over time and strengthens
the stakeholders’ trust and conıdence in the company. The company’s
corporate governance framework regulates the division of roles,
responsibilities and accountability between shareholders, the Board,
CEO, and the rest of the executive management, to ensure that the
company’s resources are applied in an efıcient and sustainable manner.
The Board has the ultimate responsibility for ensuring that good
corporate governance is practiced. Conıdence in Axactor and its
business activities is essential for the Group’s competitiveness. Axactor
is committed to openness and transparency about its principles and
procedures for how the Group is managed.
1. Implementation and reporting on
corporate governance
The company adheres to the Norwegian Code of Practice for corpo-
rate governance (“Code”), last revised 14 October 2021, issued by the
Norwegian Corporate Governance Board (“NUES”). The principles
and implementation of corporate governance are subject to annual
reviews and discussions by the Board, last revised and approved by the
Board 15 December 2021. The current corporate governance policy is
available on the company’s website.
This report addresses Axactor’s main corporate governance policies
and practices and how Axactor has complied with the Code in the
preceding year. Application of the Code is based on the “comply or
explain” principle and any deviation from the Code is explained under
each item. In the AR 2020 Axactor reported on one deviation from
the Code pertaining to share options to the chair of the Board. This
deviation was closed in May 2021. By the company’s own assessment,
Axactor is by year-end fully compliant with all sections of the Code.
2. Business activity
The company’s business as set out in the articles of association is: “to
directly or indirectly through subsidiaries or investment partnerships,
conduct debt collection work, ınancial and administrative services,
legal services, invoicing services, debt acquisition and other investment
activities, as well as therewith associated activities”.
The Board has developed clear objectives, strategies and a risk proıle
for the business within the scope of the deınition of its business,
to create value over time. Axactor’s commitment to sustainable
development is codiıed in the quality policy. Engaging in the activities
described above, the company’s long-term objective is to establish
itself as the industry benchmark within the areas of its operations. The
company will continue to pursue the following main strategies to
reach its overall objective:
x Putting emphasis on loyal and satisıed customers,
x Being an innovative player that takes full advantage of available
technologies to achieve competitive advantages,
x Identifying and securing access to attractive debt portfolios and
other opportunities in the marketplace based on responsible
investment and product offering,
x Being an attractive employer, with a focus on creating an environ-
ment for professional and personal growth, with respect and regard
for each employee,
x Being a proıtable company with a focus on organic and structural
growth,
x Maintain a sound corporate culture, efıcient corporate governance
and preserve Axactor’s integrity by supporting employees to follow
good ethical business standards towards all people and players in all
our markets, and
x Emphasis on becoming and maintaining a position as a leading,
responsible, and sustainable European player in the company’s
market, and
x Helping debtors solving their ınancial commitments through fair
debt collection practices.
A description of the key risk factors and risk management can be
found in the Board’ report on page 14
During 2021, the company has reviewed its policies and procedures
providing business practice guidance on environmental, social and
governance matters including but not limited to human resources,
legal and compliance, data privacy, information security, anti-money
laundering, corporate social responsibility, code of conduct and anti-
fraud and anti-corruption. A separate report on how these policies and
procedures are integrated with the company’s activities and how they
relate to value creation for the company’s stakeholders can be found in
the sustainability report integrated in the Annual report 2021 page 26.
The company’s objectives, strategies and risk proıle are subject to
regular review by the Board throughout the year.
Deviations from the Code: None
3. Equity and dividend
The Board aims to maintain a responsible equity ratio, considering
the company’s goals, strategy, and risk proıle. This to ensure that
the company has an appropriate balance between equity and other
sources of ınancing.
On 31 December 2021, the Group had an equity ratio of 29.5%
and a debt-to-equity ratio of 2.2x. The Board considers the current
capital structure as appropriate in the context of Axactor’s objectives,
strategy and risk proıle.
The Board has stated a policy for shareholder return as part of
the overall strategy. The objective is to generate a return for the
shareholders at a level which is at least equal to other investment
possibilities with comparable risk. The main goal is to build scale,
Corporate governance report
Axactor Group48
improve efıciency and increase proıtability. An increased return
on equity will allow Axactor to initiate dividend payments in the
upcoming 2-3-years.
At the EGM on 5 January 2021, an authorization to increase the
company’s share capital was granted to the Board:
x Authorization to increase the share capital with up to EUR
14,001,570.27130603 by issuing up to 26,750,000 new shares, each
with a nominal value of EUR 0.523423187712375, in connection
with the subsequent repair offering in order to allow those of the
company’s shareholders as of close of trading on 9 December 2020
(as registered in the VPS on 11 December 2020) who were not
allocated shares in the private placement to subscribe for shares on
the same terms as the contemplated private placement.
This authorization expired at the AGM 15 April 2021. The authorization
was utilized in full (26,750,000 shares).
At the AGM on 15 April 2021, 2 authorizations to increase the company's
share capital were granted to the Board:
x Authorization to increase the share capital by issuing new
shares with a total nominal value of up to EUR 19,366,658,
equal to 30,214,546 shares, each with a nominal value of EUR
0.523423187712375 in connection with acquisitions of assets within
the company's core areas of expertise.
x Authorization to increase the share capital by issuing new shares
or acquire own shares with a total nominal value of up to EUR
5,031,313.79 equal to 9,612,325 shares, each with a nominal value
of EUR 0.523423187712375 in connection with the share options
allocated under ESOP 2019 and ESOP 2020 (also named ESOP
2020-B) which are incentive programs for the executive manage-
ment and key personnel.
Both authorizations are valid until the AGM in 2022, and no later than
30 June 2022. As of 31 December 2021, neither authorization have
been used. There was a separate vote on each of the authorizations.
Both authorizations have a limited overall amount by which the
Board is permitted to increase the share capital. For supplementary
information, see the minutes of the AGM held on 15 April 2021
available at www.axactor.com.
Deviations from the Code: None
4. Equal treatment of shareholders
The Board and executive management are committed to treat all
shareholders equally, unless there exists a factual basis for deviation
from this principle, justiıed by the common interests of the company
and the shareholders.
In the event of a capital increase based on authorization from the
general meeting, where the pre-emptive rights of shareholders are set
aside, the company shall provide reasons for the action in the stock
exchange release in which the capital increase is announced.
In 2021 Axactor concluded a private placement, and a contribution
in kind against issuing of new shares. The capital increases main
objectives were to fund growth opportunities and general corpo-
rate purposes. The private placement and the share issuing were
performed 9 December 2020, and were approved on the EGM 5
January 2021, ref. information available on Axactor’s webpage, stock
exchange announcements given December 2020 and January 2021
and the notice to the general meeting dated 15 December 2020. The
EGM concluded, based on a recommendation from the Board, to
offer a subsequent repair offering with a subscription price equal to
the subscription price in the private placement, to mend the adverse
consequences of the private placement for the other shareholders.
Any transactions the company carries out in its own shares shall be
carried out either through the stock exchange or at prevailing stock
exchange prices. If there is limited liquidity in the company’s shares,
other ways to ensure equal treatment of all shareholders shall be
considered. There were no transactions in treasury shares in 2021.
The instruction issued by the Board states how the company shall
manage agreements with closely related parties.
For signiıcant transactions with closely related parties, Axactor will
use valuations and statements from an independent third party.
There were no such signiıcant transactions in 2021, other than the
agreement entered 9 December 2020 with the largest shareholder
Geveran Trading Co. Ltd. and Sterna Finance Ltd., approved by the
EGM 5 January 2021 as reported in the AR 2020 (corporate govern-
ance section no. 4). An independent fairness opinion conırmed by
an independent third party was arranged for this transaction. As part
of this transaction, the B-notes which at the time was held by Sterna
Finance was converted into a bond-like debt instrument, dated 8
February 2021, with Axactor SE as counterpart, a debt instrument
which is fully repaid during 2021. Subsequently, effective 20 February
2021, the parties’ entered an amendment agreement for the company
to cover Geveran Trading Co. Ltd. and Sterna Finance Ltd’s legal costs
of the transaction, as the agreement was of a greater interest to the
company and all its shareholders, necessary to enable the transaction.
For other transactions with related parties, reference is made to
the servicing agreement with Seatankers Management Co. Ltd.
(a company controlled by Geveran) entered 17 February 2020, as
reported in the AR 2020. Secondly, the board has, subject to the
approval of the annual general meeting on 21 April 2022, entered into
an option agreement with Andrés López Sánchez (Country Manager,
Spain), dated 18 May 2021 to secure his retention. Lastly, on 1 October
2021 the company entered an agreement with Aston AS (a company
controlled by Kristian Melhuus, personal deputy board member for
board member Kathrine Astrup Fredriksen) for the delivery of advisory
services to the company (expires automatically by the AGM in 2022).
All three agreements are entered on an arms-length basis and are not
considered signiıcant.
For further details, see note 31 to the ınancial statements for 2021.
Deviations from the Code: None
5. Shares and negotiability
Axactor has one class of shares, and each share carries equal voting
rights. The shares of Axactor SE are freely negotiable. There are no
restrictions on owning, trading, or voting of shares in the articles
of association.
Deviations from the Code: None
Annual report 2021 49
6. General meetings
The general meeting is the company’s ultimate corporate body.
The Board strives to ensure that the general meeting is an effective
forum for communication between shareholders and the Board.
All registered shareholders have the right to participate in the general
meetings, which exercise the highest authority of the company. To
attend, nominee-registered shareholders must be registered in the
VPS by the close of business the day before the general meeting.
Notices of general meetings are made available on newsweb.no and
on the company’s website and are sent to all shareholders no later than
3 weeks in advance of the meeting. The articles of association stipulate
that the supporting documents handling matters to be considered at a
meeting can be made available on the company’s website rather than
being sent to shareholders by post. However, shareholders are still
entitled to receive the documents by post upon request if they so wish.
The general meetings in 2021 were conducted digitally with no prior
registration deadline. When attending the online general meetings
shareholders were able to listen to a live audiocast of the meeting,
see the presentation, submit questions relating to the items on the
agenda and cast their votes in the real time poll. Identiıcation of the
shareholders was secured. The notices included information providing
the shareholders with sufıcient detail for the shareholders to assess
all the matters to be considered as well as all relevant information
regarding attendance and voting procedures including a proxy form
with and without voting instructions that permitted separate votes
for each item up for consideration in the general meetings and each
candidate up for election by the AGM. Advanced votes and proxies
were required to be provided the last business day prior to the general
meetings by electronic means, in writing or by use of written proxy
forms. The chair of the Board declared the general meetings opened.
The person chairing the general meetings was elected by the general
meeting and was considered independent of the company and the
Board. Representatives of the Board, executive management, the
company’s auditor, and the chair of the nomination committee were
present at the AGM. For the EGM only the chair of the Board and CEO
were present which was deemed sufıcient given the items treated.
In 2021, Axactor held its AGM on 15 April 2021 with 51,06% of the
shares represented. In addition, an EGM was held on 5 January 2021
to increase the share capital, with 38% of the shares represented.
The minutes from general meetings are published on newsweb.no
and on the company’s website.
Deviations from the Code: None
7. Nomination committee
The company has established a nomination committee, ref. articles
of association article 8. It consists of 2 members:
x Anne Lise E. Gryte (chair)
x Magnus Tvenge (member)
Both were elected by the AGM in 2020 for a period of 2 years, until
the AGM in 2022, and are considered independent of the Board and
the executive management. Efforts are made to ensure that the
nomination committee comprises of persons with the necessary
expertise and understanding of the shareholders’ interests.
The general meeting in 2020 elected the chair of the nomination
committee and determined the remuneration to the members based
on the nature of the duties performed and the time invested. The
remuneration for the second year was also approved by the general
meeting in 2021.
The duties and responsibilities of the nomination committee is
regulated by the instructions to the nomination committee approved
by the general meeting in 2020. The main responsibilities are to
propose candidates for election to the Board, and to advice on the
remuneration of the board members. Grounds for recommendations
are provided when nominees are presented to the general meeting, at
latest at the time of the notice of the general meeting. All shareholders
are entitled to nominate candidates to the Board, and information on
whom to contact can be found on the company’s website.
The nomination committee monitors the need for any changes in
the composition of the Board through dialogue with the shareholders,
board members, and executive management. The nomination com-
mittee has also reviewed the Board’s report on its own performance
as outlined in section 9 on the next page.
Deviations from the Code: None
Operational
Management
Internal Control
General Meeting (GM)
Board of Directors
Internal Audit
External Audit
Supervisory Authority
Risk Management
Compliance
Other
CEO / Executive-team
Axactor Group50
8. Board of Directors
Composition
The Board shall constitute of 3 to 7 directors, as regulated in the
articles of association clause 5. The Board was elected by the general
meeting. As the chair, Glen Ole Rødland resigned from his duties
29 May 2021, the Board decided to elect Merete Haugli as interim
chair. On 31 December 2021, the Board consisted of the following
6 directors:
Name Role Age
Considered
independent of
main shareholders Served since Term expires
Participation
Board meetings
2021
Share ownership
in Axactor as of
31 December 2021
(direct/indirect)
Merete Haugli Chair 57 Yes 20.01.17 and as
interim chair
since 30.05.21
AGM 2022 28/29 0
Brita Eilertsen Director 59 Yes 20.01.17 AGM 2022 28/29 19,892
Lars Erich Nilsen
1)
Director
40
No
04.05.18
AGM 2022
29/29
0
Kathrine Astrup Fredriksen
1)
Director
38
No
01.04.20
AGM 2022
21/29
0
Terje Mjøs Director 60 Yes 20.01.17 AGM 2022 27/29 400,000
Hans Harén Director 71 Yes 25.05.20 AGM 2022 27/29 22,150
Kristian Melhuus Personal deputy
for Kathrine Astrup
Fredriksen
40 No 15.04.21 AGM 2022 7/29 0
1) According to the NUES, Kathrine Astrup Fredriksen and Lars Erich Nilsen are related to Geveran Trading Co Ltd, which owned 45,98% of the shares in Axactor SE at 31 December
2021, ref. page 62.
All members of the Board are elected until the next AGM and may be
re-elected. The composition of the Board is based on broad representa-
tion of the shareholders, as well as the company’s need for competence,
capacity, and ability to form balanced decisions. Information on each
Board member’s expertise and capacity can be found in the Annual
report 2021 on page 46 and on the company’s website.
Independence
The nomination committee has evaluated all the board members to
be independent of the executive management and material business
contacts. 4 out of 6 board members are regarded as independent
of the main shareholders. The independence of board members is
evaluated by the Board, and if any changes occur, their independence
will be re-evaluated.
Deviations from the Codee: None
9. The work of the Board
The Board has the primary responsibility for overseeing and super-
vising the executive management and operations. The Board has
adopted written instructions which describes the responsibilities
and duties of the Board, including how the Board should handle
agreements with related parties, and regulate the allotment of work
between the CEO and the Board. The instructions also regulate work
related to the Board committees.
The Board’s primary responsibilities include: (i) participating in the
development and approval of the strategy and budget, (ii) performing
necessary monitoring functions, and (iii) acting as an advisory body to
the executive management. The Board’s duties may change over time,
depending on the company’s ongoing needs.
The Board has prepared an annual plan for its work with special
emphasis on goals, strategy, and implementation, to ensure that, (i) the
operation of the company complies with the company’s values, ethical
guidelines and corporate social responsibility, (ii) that the business and
assets are well-managed, and (iii) that the risk management and the
ınancial reporting is carried out in a prudent and satisfactory manner.
The Board has also established rules on conlicts of interest to ensure
that any potential conlicts are identiıed and handled in a professional
manner. If the Board is to consider material matters in which the chair
of the Board is, or has been, personally involved, the meeting in which
the matter is considered shall be chaired by another board member.
There were no such cases in 2021.
The chair of the Board ensures that the Board’s work is performed
in an effective and correct manner. It is the Board’s responsibility to
ensure that that the company is managed with clear distribution of
responsibilities and duties. The Board appoints the CEO, which is
responsible for the day-to-day operations of Axactor Group and
for ensuring that the Board receives accurate, relevant, and timely
information, sufıcient for the Board to carry out its duties. The duties,
responsibilities and delegated authorities for the CEO are stated in the
CEO instruction issued by the Board.
All members of the Board regularly receive information about the
operational and ınancial development. The company’s strategies
are regularly subject to review and evaluation by the Board. The
Board holds regular physical meetings, at least every 2 months,
where the members may elect to attend either physically or virtually.
Extraordinary board meetings are held when necessary and may be
conducted as telephone conferences or, in exceptional circumstances,
the Board may take its decisions on the basis of circulating documents.
In 2021, the Board held 29 board meetings. 4 of these were held prior
to the interim reporting, while 4 were devoted to strategy discussions,
Annual report 2021 51
business, operational and ınancial updates, risk and internal control,
ESG discussions, portfolio assessments, remuneration and employee
related matters, review of polices and instructions etc. In addition,
21 extraordinary board meetings were held to discuss repair issue
in relation to a private placement, bond issue, change of the Board’s
composition, portfolio purchases, process with the Norwegian
supervisory authority, acquisition, budget and deep dive on the local
business operations. The CEO has been present in all board meetings.
However, the Board has discussions without executive management
present in all board meetings and separate discussions with the
auditor without executive management present.
The Board’s work, constitution of the board committees and review
and approval of the Board’s instructions were discussed in the consti-
tutional board meeting following the AGM. In addition to the Board’s
discussions without the executive management present after each
ordinary board meeting, the Board conducts an annual assessment of
its performance and expertise. The assessment of the year 2021 was
conducted in December 2021 and discussed in the board meeting
17 February 2022.The results has been presented to the nomination
committee. In addition, the nomination committee has discussed the
performance with each board member.
Board committees
The Board has established an audit committee, an investment
committee and a remuneration committee to provide subject matter
advice to and preparation for the full Board.
The audit committee’s main responsibilities are to supervise the
Group’s internal control and risk management system, to ensure that
the auditor’s independency, and to ensure that the annual accounts
give a fair picture of the Group’s ınancial results and ınancial condition
in accordance with generally accepted accounting practice. The
audit committee works as the Board’s risk committee, reviews the
procedures for risk management, and assess the risks and ınancial
controls related to the Group’s business activities. The audit com-
mittee ensures that the company has sufıcient focus on ESG to
contribute to sustainable development and appropriate risk manage-
ment to minimize negative impact of the operations. The committee
follow-up on regulatory changes, compliance matters that may have a
material impact on the ınancial statements or policies, monitor material
external investigations, sanctions, claims, litigations, substantial authority
contact, licenses issues and follow up security incidents and whistle
blower reports. The audit committee also receives reports on the work
of the internal and the external auditor and the results of the audits.
As of 31 December 2021, the audit committee consisted of the
following members:
x Hans Harén (Chair)
x Merete Haugli
x Terje Mjøs
x Brita Eilertsen
All of the members are independent of the executive management,
and all of the member(s) have qualiıcations within accounting.
The audit committee held 6 meetings in 2021.
The investment committee oversees the ınancial investment
process and proposals to ensure that the relevant investments meet
the requirements with respect to expected return, responsible
investments and due diligence prior to commitment of funds. Further,
the investment committee quarterly reviews the re-evaluations of
portfolios regularly assess the risks of the market from a micro and
macro perspective and evaluate and implement necessary mitigations
to reduce the risks.
As of 31 December 2021, the Investment Committee consisted of the
following members:
x Brita Eilertsen (Chair)
x Lars Erich Nilsen
x Kathrine Astrup Fredriksen
The investment committee held 20 meetings in 2021.
The remuneration committee develops the philosophy, policy and
guidelines for remuneration that creates the link between remuner-
ation levels, business performance and return to shareholders and
makes proposals to the Board on the employment terms and total
remuneration of the CEO and approve the terms and remuneration
for the executive management which are communicated to the general
meeting. These guidelines create precedence for remuneration
throughout the organization. Further, the committee oversees that
the company has an appropriate succession plan, monitor employee
satisfaction, and assess and follow-up other material employment
issues related to executive personnel.
As of 31 December 2021, the remuneration committee consisted of
the following members:
x Terje Mjøs (Chair)
x Merete Haugli
The remuneration committee held 4 meetings in 2021.
Deviations from the Code: None
10. Risk management and internal control
The Board is responsible for ensuring that the company has sound
internal control and systems for risk and compliance management
appropriate to the extent and nature of the company’s activities.
In 2021 Axactor has continued to build on the advancements made
during 2020 on the ESG performance, further strengthening the
value for the stakeholders and society. Sustainability is an integral
part in the company’s vision to become the industry benchmark,
as also anchored in the quality policy. This is further outlined in the
sustainability report, cf. Annual report 2021 page 25.
The company’s systems and procedures related to risk management
and internal control contributes to efıcient operations, timely and
correct ınancial reporting, and compliance with applicable laws and
regulations. These systems form an integral part of the management’s
decision-making process.
The internal control and risk management system cover the
organizational structure, managerial responsibilities for compliance,
policies and procedures, training, customer and supplier due diligence,
monitoring through ınancial reviews and internal audits, incident
Axactor Group52
investigations and corrective actions as well as reporting. The Code of
Conduct and Group policies are reviewed and approved by the Board
annually. All policies have designated owners within the executive
management, responsible for developing and monitoring compliance
with their respective areas.
The Board has approved the following policies in 2021:
Quality
Legal and compliance
Insider
Corporate governance Operations
Anti-fraud and
anti-corruption
IT and information
security Delegation of authority Anti-money laundering
Code of Conduct Physical security Antitrust
Procurement
Corporate social
responsibility Trade sanctions
Finance
Environmental
Treasury
Communication
Debt purchase
HR Data protection
To each policy a set of procedures are established e.g. the Legal and
Compliance policy has a procedure for managing internal control and
risk management. The risk management framework shall ensure that
the business operations comply with applicable laws and regulations,
commitments to sustainable operations, and business ethics, as well as
ensuring proıtability, efıciency, and continuity. The company operates
a structured risk management process that includes relevant catego-
ries of risk, such as strategic, ınancial, operational and regulatory risks.
A top-down/bottom-up risk assessment is conducted annually. Key
risks are monitored through monthly business reviews with the
executive management, and through quarterly reporting to the
Board. All employees are trained regularly, and annually as a minimum,
through trainings on inter alia business ethics, anti-fraud and anti-
corruption, good debt collection practices, GDPR and anti-money
laundering and customized training within their area of responsibility.
Compliance with the Code of Conduct is another key component in
the Group’s internal control system. The company has established an
independent whistle-blowing channel for all employees and vendors
to report any concerns related to illegal or unethical conduct.
Internal controls are conducted throughout the Group annually, at
deıned intervals which vary between departments. The legal and
compliance functions, locally and at group level, follow up on the
performance of the controls, as well as any deviations and necessary
mitigations. The results are reported to the Board regularly. Axactor’s
internal auditor conduct audits recommended by the Board and
reports its ındings to the Board quarterly.
Axactor’s separate entities prepares its ınancial statements within
a standard ınancial accounting system which is consolidated into
the Group’s results. Impairment testing of NPLs is conducted on a
quarterly basis and goodwill and REOs at least on an annual basis.
These processes are reviewed by the external auditor. The external
auditor presents a review of the internal control procedures, including
identiıed weaknesses and proposals for improvement, to the Board
at least once a year. The audit committee monitors the ınancial
reporting and internal control regularly.
Under Norwegian securities laws, the Norwegian Financial
Supervisory Authorities (FSA) oversees that the ınancial reporting
of issuers of transferable securities which are quoted or for which
admission to quotation has been requested on a regulated market
within the EEA, is compliant with relevant laws and regulations.
As communicated in a press release on 13 December 2021, Axactor SE
has received a conclusion from the Norwegian Financial Supervisory
Authority (FSA) regarding the review of certain accounting practices
and their implications for the AR 2019 and Half-Year Report 2020. The
company take notice of the conclusion from FSA and will implement
the requested changes accordingly. Further information about the
FSA process can be found in Board report page 20 and in note 3 in the
Annual report 2021.
The Board accounts for the main features of the internal control and
risk management systems in the annual report.
Deviations from the Code: None
11. Remuneration of the Board of Directors
The remuneration of Board members is stipulated annually by the
AGM based on the nomination committee’s recommendation. The
remuneration relects the Board’s responsibilities, work, time invested
and the complexity of the company.
The remuneration of Board members is not performance based
and in principle the company does not grant share options to board
members.
The chair the Board receives a higher compensation than the
other board members, and work in board committees provides for
additional compensation. The Board shall be informed if any board
members perform other tasks for the company than exercising their
role as board members. An agreement has been entered with Aston
AS, a company controlled by the personal deputy board member
for Kathrine Astrup Fredriksen, Kristian Melhuus for his advisory
services for the company when he does not act as board member in
Fredriksen’s absence. There were no other arrangements of similar
sort entered in 2021.
Further details about the remuneration of the Board can be found in
note 8 to the annual accounts in the Annual report 2021.
Deviations from the Code: None
12. Salary and other remuneration
of executive management
The Board decides the salary and other compensation paid to the
CEO. The CEO’s salary and bonus are based on an evaluation with
emphasis on speciıc factors determined by the Board. Each year, the
Board carries out an assessment of the salary and other remuneration
to the CEO and revise the total compensation and remuneration
criteria without any executive management present.
The CEO determines the remuneration of executive employees
together with the Board’s remuneration committee. The Board has
Annual report 2021 53
issued guidelines for the remuneration of the CEO and the executive
management team which has been presented and approved by
the AGM and published on the company’s website. The salary level
ensures that the company can attract and retain executive employees
with the desired expertise and experience without harming the
company’s reputation or exceeding the norm in comparable
companies. Performance related salary in the form of share options,
bonus schemes or the like is linked to value creation for shareholders
or the earnings performance over time, and subject to an absolute
limit of 75% of the annual base salary for the CEO and 50% for the
members of the executive team.
The Board’s statement regarding remuneration of the executive
management can be found in note 8 to the annual accounts in the
Annual report 2021.
Deviations from the Code: None
13. Information and communication
The company complies with the relevant recommendations and
market practices for reporting ınancial and other Investor Relation
(“IR”) related information.
The Board and the executive management team prioritize to give
shareholders quick, relevant and current information about the
company and its activity areas, while ensuring equal treatment.
The Board has adopted an insider policy to increase awareness of the
responsibility entailed by the possession of inside information and
the consequences of misusing such information and to ensure that
Axactor itself fulıls its responsibilities. The Board has also adopted
a communication policy which regulates spokespersons on behalf
of the company and disclosure of information to the market and
investor community in a transparent, honest, consistent, reliable and
timely manner. The CEO and the Chief of IR and strategy are the main
contact persons in such respects. Contact details of the IR represent-
atives are available at the company website to facilitate the dialogue
between the company and its shareholders.
Financial information is published by producing quarterly reports and
annual reports as well as stock exchange notices, in accordance with
Oslo Børs’ recommendations.
The Board shall keep itself updated on matters of special importance
to the shareholders. The Board shall therefore ensure that the
shareholders are given the opportunity to make known their points
of view at and outside the general meeting.
Deviations from the Code: None
14. Take-over bids
There are no restrictions in the articles of association to hinder the
acquisition of shares in Axactor. Guidelines have been prepared for
how the Board shall respond to any takeover bids. The guidelines are
in accordance with the Code.
As reported in the AR 2020, and as announced 9 December 2020
and approved by the EGM 5 January 2021, Axactor achieved 100%
ownership of Axactor Invest 1 S.a.r.l through the acquisition of
Geveran's 50% stake therein as one of multiple initiates taken to
strengthen Axactor’s ınancial platform to improve shareholder
returns and support further growth. Axactor and Geveran agreed on a
consideration of 50 million shares to be issued at a share price of NOK
8.00, corresponding to a value for the 50% stake of EUR 38 million.
The transaction increased Geveran’s ownership in Axactor from
31.95% to 46.41% and Geveran was consequently obliged to provide
a mandatory offer to purchase the remaining shares. The offer was
evaluated by an independent third-party expert approved by the Oslo
Børs. The Board decided
to recommend shareholders to not accept the Mandatory Offer.
Geveran received valid acceptances under the mandatory offer for
a total of 625,806 shares, corresponding to approximately 0.23%
of the registered share capital and voting rights in the company.
At completion of the mandatory offer Geveran owned 122,643,578
shares representing 44.53% of the total registered share capital and
voting rights in the company (based on 275,395,464 issued and
registered shares in the company). Following registration of the
share capital increase issued by the company on 23 February 2021,
Geveran's relative shareholding was 40.59% of the total share capital
and voting rights in the company.
Deviations from the Code: None
15. Auditor
The auditor has attended one meeting with the Board at which the
company’s management was not present to review the company’s
ınancial reporting, accounting principles, risk areas, internal control
routines etc. The Board’s audit committee has met twice with the
auditor during 2020 where the auditor presented a plan for the
implementation of the audit work, observations, risks etc. The auditor
has conırmed in writing to the Board and the audit committee that
independence and objectivity requirements are met.
The auditor is only used as a ınancial advisor to the company if
such use of the auditor cannot inluence or call into question the
auditors’ independence and objectiveness in its capacity as auditor
for the company. The Board has established guidelines in respect of
the use of the auditor by the company’s executive management for
services other than the audit. The breakdown between the auditor’s
fee and consultancy fees for 2021 is described in note 9 to the annual
accounts.
At the AGM, the Board presented a review of the compensation paid
to the auditor for audit work required by law and remuneration for
other concrete assignments.
In connection with the auditor’s presentation to the Board of the
annual work plan, the Board also reviewed the work and performance
of the auditor.
The Board arranges for the auditor to attend all AGMs and EGMs when
deemed necessary depending on item treated.
The company’s auditor is PwC and considered independent from the
company and the Board.
Deviations from the Code: None
Axactor Group54
Board of Directors
Brita Eilertsen
Board member
Ms. Eilertsen has experience from investment banking and consulting institutions like SEB
Enskilda, Orkla Finans and Touche Ross Mgmt Consultants (Deloitte). She has held various
board positions for a number of listed and private companies in different industries since 2005.
Eilertsen currently holds board positions for Pareto Bank and C WorldWide.
Ms. Eilertsen holds a Master of Economics and Business Administration (Norwegian
“Siviløkonom”) from the Norwegian School of Economics (NHH) and is a Certiıed Financial
Analyst (AFA).
Merete Haugli
Interim Chair
Ms. Haugli has experience as a board member from a number of companies, currently as chair
in Norwegian property ASA as well as a member of their audit committee. She has also been a
board member of Solstad Offshore ASA, Comrod Communication ASA, Reach Subsea ASA,
RS Platou ASA, and Aktiv Kapital ASA. Ms. Haugli has held several senior positions including
Head of Wealth management in SEB, Head of Formuesforvaltning AS, Partner in First Securities
ASA and Head of investment in Alfred Berg Norway AS. She has also been a member of the
nomination committee of Mowi ASA and North Energy ASA. She was previously Assistant
Chief in the Oslo Police, responsible for the economic crime section.
Ms. Haugli is a business economist from the Banking Academy and from the Norwegian
Business School, BI, with special focus on ınance, tax, and accounting.
Terje Mjøs
Board member
Mr. Mjøs was CEO of Visolit AS from 2017 to 2021, chair of the board of Solid Media Group and a
senior advisor to Apax Partners (private equity) from 2015 to 2017, CEO of EVRY ASA from 2010
to 2015 and before that CEO of Ergo Group AS from 2004 to 2010. He held in the period 1989 to
2004 several senior positions in Hydro IS Partner AS.
Mr. Mjøs has a Cand. Scient. Degree in Computer Science from the University of Oslo, and an
MBA in Economics and Business Administration from Norwegian Business School BI.
Annual report 2021 55
Kathrine Astrup Fredriksen
Board member
Ms. Fredriksen is currently employed by Seatankers Management Co Ltd. in London and serves
as director in SFL Corporation Ltd. Her previous directorships include Seadrill Ltd, Frontline Ltd,
Golar LNG and Deep Sea Supply. She has been a board member in Norwegian Property ASA
since 2016 and SFL Corporation Ltd. since April 2020.
Ms. Fredriksen was educated at the European Business School in London.
Lars Erich Nilsen
Board member
Mr. Nilsen is the CEO and Chair of Seatankers Management Norway AS. He has experience as
an investment analyst from Fearnley Advisors AS and equity analyst from Fearnley Securities AS.
He is also currently a board member of Norwegian Property ASA, Bulk Infrastructure Holding AS
and FP Bolig Holding AS.
Mr. Nilsen has a Master of Economics and Business Administration (Norwegian “Siviløkonom”)
from Norwegian Business School, BI.
Hans Olov Harén
Board member
Mr. Harén has extensive experience from bank and ınance within the consumer ınance segment.
He retired from the position as CEO of Gjensidige Bank ASA in 2017, a position that he held for
eight years. Prior to that, he was Country Business Manager and General Manager Consumer
Business in Citibank consumer segment in Norway. He also has broad experience from senior
positions in American Express, Wasa Insurance and Trygg Hansa Liv.
Mr. Harén holds a degree in business administration (Swedish “Marknadsekonom”) from IHM
Stockholm as well as a training in senior management from the Stockholm School of Economics.
Kristian Melhuus
Deputy Board member (Chair as of 21 February, 2022)
Mr. Melhuus is partner in Sandwater AS, an impact venture capital fund and Deputy Chair of
Mowi ASA. Before partnering up with Sandwater he held the position as director of Seatankers
Management Norway AS, Investment Director in HitecVision, CFO/COO of Liquid Barcodes
and analyst at ABG Sundal Collier. In the EGM 21 February 2022, Kristian Melhuus was elected
Chair of the Board.
Mr. Melhuus holds an MSc in Industrial Economics and Technology Management from the
Norwegian University of Science and Technology (NTNU), and has also studied Finance,
Derivatives, and Econometrics at the University of Karlsruhe.
Axactor Group56
Executive management
Johnny Tsolis
Chief Executive Ofıcer
Mr. Tsolis is the Chief Executive Ofıcer at Axactor, in charge of managing the company.
Mr. Tsolis is a co-founder of Axactor and has previously held positions as Chief Financial Ofıcer
and Chief of Strategy & Projects. He has eight years of experience from working as a consultant
for the Lindorff Group, with main focus on PMI/cost, productivity improvement and post-merger
acquisition processes. Mr. Tsolis has a broad international experience with more than ıve years
on projects abroad, primarily in Spain, Germany, the US, the Netherlands, Denmark, Sweden and
Finland. Mr. Tsolis’ former work experience includes positions as a partner at Cardo Partners AS,
partner at DHT Corporate Services, Handelsbanken Capital Markets and Arkwright.
Mr. Tsolis graduated from BI Norwegian Business School (BI) with an MSc in business degree.
Arnt Andre Dullum
Chief Operating Ofıcer
Mr. Dullum is the Chief Operating Ofıcer at Axactor Group, overseeing the company's
business operations.
Prior to the Chief Operating Ofıcer role, he was Head of Operations in Axactor Norway, and
he has held multiple roles within Lindorff Group and Lindorff Norway, including Operational
Director and Project Director. Mr. Dullum has extensive international experience, working on
multiple Pan-European projects, and has also been stationed in Spain and the Netherlands for
extended periods as an expatriate.
He holds a bachelor’s degree from BI Norwegian Business School (BI) and an MBA with the
highest distinction from Norwegian School of Economics (NHH).
Vibeke Ly
Chief of Staff
Ms. Ly is the Chief of Staff, responsible for legal & compliance, sustainability, internal audit,
HR and marketing & communications.
Ms. Ly has more than nine years of experience from the industry. Prior to joining Axactor, she
held the positions as Group corporate lawyer and Group data protection ofıcer in Intrum, and
EVP group compliance and group corporate lawyer in Lindorff. Earlier she served as a Group
corporate lawyer in EVRY, as an associate in lawyers ırm Grette and as a legal advisor in the
Justice Department.
She holds a Master of Laws from the University of Oslo (UiO), in addition to international law
from Université libre de Bruxelles (ULB) and law and prosecution rights from University of
Bergen (UiB).
Annual report 2021 57
Kyrre Svae
Chief of Strategy and IR
Mr. Svae is the Chief of Strategy and IR at Axactor Group, responsible for the strategy formulation
and investor relations.
He has fourteen years of experience working primarily as a management consultant on projects
in Norway, Sweden, Denmark, Finland, the Netherlands, Germany and the USA. Mr. Svae has
extensive experience from strategy development, operational improvement and M&A in a
wide range of industries, including the debt management industry. His former work experience
includes positions as founder and managing partner in Breidablikk Consulting AS and partner in
Cardo Partners AS.
Mr. Svae holds an MSc from Copenhagen Business School, with part of the degree from Harvard
University and China Europe Int. Business School.
Robin Knowles
Chief Investment Ofıcer
Mr. Knowles is the Chief Investment Ofıcer at Axactor Group, responsible for the purchase and
evaluation of Axactor’s portfolios.
Mr. Knowles has seven years of experience working as the Investment Director at Lindorff
Group. He has broad industry experience across Scandinavia, Continental Europe and the UK
covering the last 20 years, including positions in Aktiv Kapital (PRA), Cabot Financial and Morgan
Stanley as well as his time in Lindorff. His former work experience includes investment banking
with Barclays Bank for four years and container shipping with P&O Nedlloyd for four years,
where he also qualiıed as a management accountant.
He holds a bachelor’s degree from the University of Plymouth and is a qualiıed accountant with
Chartered Institute of Management Accountants (CIMA).
Nina Mortensen
Chief Financial Ofıcer
Ms. Mortensen is the Chief Financial Ofıcer at Axactor Group, having primary responsibility for
managing the company’s ınances.
She has extensive experience in ınancial governance and transformations, ınance operations
and mergers & acquisitions. Ms. Mortensen has held several ınancial leadership positions within
TietoEVRY, among others interim CFO for the EVRY group and Head of Corporate Controlling
and Finance Operations, and within Deloitte.
She holds a master’s degree in economics and business administration from the Norwegian
School of Economics (NHH) and is MBA-qualiıed. Ms. Mortensen is also a certiıed public
accountant (CPA) from BI Norwegian Business School (BI).
Axactor Group58
Lisa Sohtell
Country Manager Sweden
Ms. Sohtell has over 20 years’ experience of customer service as site manager for multiple call
centers at Transcom and Teleperformance. Prior to entering the position as Country Manager at
Axactor Sweden she spent several years as Head of Operations at both Lindorff and Axactor.
Ms. Sohtell studied at the Gothenburg School of Business, Economics and Law (GU).
Heidi Piispanen
Country Manager Finland
Ms. Piispanen has over 20 years’ experience from the debt collection industry and the banking
and ınance industry. Prior to the role as Country Manager in Finland, she was Group Operations
Director in Axactor. Before joining Axactor, she held the position as director of debt purchase
in Lindorff for Finland, Baltics and Russia. Former work experience includes positions as director
of the non-performing loans portfolio in Aktiv Kapital in Finland and as collection department
manager in Citibank.
Ms. Piispanen holds a bachelor’s degree from Helsinki Metropolia University of Applied Sciences.
Steffen Fink
Country Manager Germany
For the last 25 years Mr. Fink has held various management positions for the international credit
insurer, Coface. Before joining Axactor he was "Head of Nordics" with responsibility for all
Scandinavian subsidiaries. He was also CEO of two debt collection companies in Denmark and
Sweden. Until 2014 Mr. Fink was Regional Claims and Debt Collection Director with the same
credit insurer in Germany and responsible for activities in Germany, Russia, the Netherlands and
Scandinavia.
Mr. Fink graduated from Commercial College Wiesbaden and ınalized as a lawyer and notary
professional.
Annual report 2021 59
Andrés López
Country Manager Spain
Mr. López began his professional career advising on legal matters at AIG Europe Limited
company before becoming one of the founding partners of ALD Abogados, a solicitor and legal
startup acquired by Axactor in 2015. Over the past 17 years he has specialized in the Spanish
market, consolidating his experience in acquiring & valuating debt portfolios.
Mr. López holds a degree in law from Complutense University of Madrid, and a PDD from IESE
Business School.
Antonio Cataneo
Country Manager Italy
After having held managerial roles in other sectors, Mr. Cataneo now has over 12 years’ experi-
ence in running debt collection businesses. Before acting as Country Manager in Axactor Italy,
he held primary executive roles in KRUK Group in Italy and was COO & Member of the Board of
Credit Base International.
Mr. Cataneo holds a bachelor’s degree from Universitá di Pavia in political and economic
sciences.
Stina Koren
Country Manager Norway
Ms. Koren has over 20 years of experience working with debt collection and customer service.
Prior to the role as Country Manager at Axactor Norway she has had several management roles
in Lindorff, both in Norway and Sweden, mainly within operations, business development and
digitalization.
Ms. Koren holds a bachelor’s degree from BI Norwegian Business School (BI).
Axactor Group60
Shareholder information
The company’s total capitalization at 31 December 2021 was NOK
2.28 billion, based on a closing share price of that day of NOK 7.55.
Dividend policy
The company is a growth company in a capital-intensive industry.
At this stage, focus will be to ınance purchase of portfolios and devel-
oping operations. The current dividend policy is to not pay cash as
dividend to shareholders. As the return on equity gradually improves,
Axactor aims to update this policy and initiate dividend payments.
Shares and share capital
At 31 December 2021, Axactor had 302,145,464 ordinary shares
outstanding with a par value of EUR 0.523 (rounded) per share, see
note 25 to the ınancial statement. The company has one share
class, and all shares have equal voting rights and the right to receive
dividend. At 31 December 2021 the company had 11,128 shareholders.
Listing
The Company’s shares are quoted and traded in NOK at Oslo Børs
(Ticker: ACR) since 2015. The shares belong to the ınance category
and are registered in the Norwegian Central Securities Depository
(VPS), with DNB Issuer Service Registrar. The shares carry the security
number ISIN SE0011309319.
Principal shareholders
The 20 largest shareholders of Axactor are predominantly Norwegian
and international institutional investors. A table of the 20 largest
shareholders is included in this chapter.
Employee incentive plan
The company has a share option plan for the executive management
and key employees. A total of 0.5 million share options were granted
under this plan during 2021 and per 31 December 2021 8.5 million
share options are outstanding. Further information on the company’s
share option plan has been included in note 26 to the consolidated
ınancial statements.
Investor relations
Axactor wishes to maintain an open dialogue with the capital market.
Regular information is therefore published through the annual report,
interim reports and presentations and stock exchange announcements.
The company distributes all information relevant to the share price to
Oslo Børs. Such information is distributed without delay and simul-
taneously to the capital market and the media and published on the
company website.
The CEO and the Chief of Strategy and IR are responsible for the
company’s investor relations activities and for all communication
with the capital markets. All information is communicated within the
framework established by security and accounting legislation and
rules and regulations of Oslo Børs.
All information regarding Axactor is available on the company’s
website at www.axactor.com.
Annual General Meeting
The annual general meeting is normally held in April or May. Written
notice and additional relevant material are sent to all shareholders
individually or to their custodian bank at least three weeks before
the AGM is to take place. The notice is also made available on the
company’s website. Shareholders are encouraged to participate and
to vote at the AGM. To vote, shareholder must either be physically or
digitally present or be represented by a proxy.
Annual report 2021 61
20 largest shareholders as registered in VPS at 31 December 2021
Name Shareholding Share%
Geveran Trading Co Ltd 138,920,892 45.98%
Torstein Ingvald Tvenge 10,000,000 3.31%
Ferd AS
7,864,139
2.60%
Verdipapirfondet Nordea Norge Verdi
4,454,162
1.47%
Skandinaviska Enskilda Banken AB 3,079,467 1.02%
Nordnet Livsforsikring AS 2,247,811 0.74%
Endre Rangnes 2,017,000 0.67%
Gvepseborg AS 2,009,694 0.67%
Stavern Helse Og Forvaltning AS 2,000,000 0.66%
Alpette AS 1,661,643 0.55%
Verdipapirfondet Nordea Avkastning
1,643,423
0.54%
Velde Holding AS 1,400,000 0.46%
Verdipapirfondet Nordea Kapital 1,343,933 0.44%
Klotind AS 1,296,693 0.43%
Andres Lopez Sanchez 1,177,525 0.39%
David Martin Ibeas
1,177,525
0.39%
Svein Dugstad
1,154,187
0.38%
Nordea Bank Abp 1,116,576 0.37%
Nordnet Bank AB 1,086,987 0.36%
Latino Invest AS 1,040,000 0.34%
Total 20 largest shareholders 186,691,657 61.79%
Other shareholders
115,453,807
38.21%
Total number of shares 302,145,464 100%
Geographic residence of shareholders as registered in VPS at 31 December 2021
Shareholding Share %
Norway
144,582,187
47.9%
Cyprus 138,920,892 46.0%
Luxembourg 5,131,808 1.7%
Spain 2,469,331 0.8%
Sweden 2,018,062 0.7%
United Kingdom 1,539,706 0.5%
United States 1,254,144 0.4%
Other
6,229,334
2.1%
Total
302,145,464
100%
Ownership structure by size of holdig as registered in VPS at 31 December 2021
Number of holders Number of shares Share %
1-10,000 shares 9,216 13,737,605 4.55%
10,001- 100,000 shares 1,657 45,716,676 15.13%
100,001- 1,000,000 shares 234 54,999,526 18.20%
1,000,001- 5,000,000 shares 18 30,906,626 10.23%
Above 5,000,000 shares
3
156,785,031
51.89%
11,128
302,145,464
100%
Axactor Group62
Financials statements
of Axactor Group and
Parent Company
Consolidated statement of proıt or loss 64
Consolidated statement of comprehensive income 65
Consolidated statement of ınancial position 66
Consolidated statement of changes in equity 68
Consolidated statement of cash lows 69
Notes to the consolidated ınancial statements 71
Parent company statement of proıt or loss 113
Parent company statement of comprehensive income 114
Parent company statement of ınancial position 115
Parent company statement of changes in equity 117
Parent company statement of cash lows 118
Notes to the parent company ınancial statements 120
Annual report 2021 63
Consolidated statement of proıt or loss
For the year ended 31 December
EUR thousand Note 2021 2020
Interest revenue from purchased loan portfolios 6, 18 168,421 163,093
Net gain/(loss) purchased loan portfolios 6, 18 (62,013 ) (49,813 )
Other operating revenue 88,704 87,871
Other income
Total income 5,6 195,127 201,175
Cost of REOs sold, incl. impairment
22
(50,515 )
(52,932 )
Personnel expenses 7, 8 (61,313 ) (54,872 )
Other operating expenses 9 (59,565 ) (61,372 )
Total operating expenses (171,393 ) (169,176 )
EBITDA 23,733 31,999
Amortization and depreciation
10, 14, 15, 16
(9,654 )
(10,838 )
Operating proıt
Financial revenue 11 3,033 12,650
Financial expenses
11
(57,809 )
(66,039 )
Net ınancial items
(54,775 )
(53,390 )
Proıt/(loss) before tax
(40,696 )
(32,228 )
Income tax expense 12 (5,296 ) (1,774 )
Net proıt/(loss) after tax
(45,992 )
(34,002 )
Attributable to:
Non-controlling interests (13,194 ) (15,871 )
Shareholders of the parent company (32,797 ) (18,131 )
Earnings per share: basic 13 (0.112 ) (0.099 )
Earnings per share: diluted
13
(0.112 )
(0.099 )
Axactor Group64
Consolidated statement of comprehensive income
For the year ended 31 December
EUR thousand Note 2021 2020
Net proıt/(loss) after tax
(45,992 )
(34,002 )
Items that will not be classiıed subsequently to proıt or loss
Remeasurement of pension plans (4 ) (58 )
Net gain/(loss) on equity instruments designated at fair value through OCI (16 ) -
Items that may be classiıed subsequently to proıt or loss
Foreign currency translation differences 8,924 (11,278 )
Net gain/(loss) on cash low hedges 19 (230 ) -
Other comprehensive income/(loss) after tax 8,675 (11,336 )
Total comprehensive income/(loss)
(37,317 )
(45,338 )
Attributable to:
Non-controlling interests (13,194 ) (15,871 )
Shareholders of the parent company (24,123 ) (29,467 )
Annual report 2021 65
Consolidated statement of ınancial position
For the year ended 31 December
EUR thousand Note 2021 2020
ASSETS
Intangible non-current assets
Intangible assets 6, 14
Goodwill
6, 14, 15
Deferred tax assets 12 13,700 7,769
Tangible non-current assets
Property, plant and equipment 6, 16 2,290 2,530
Right-of-use assets
6, 10
Financial non-current assets
Purchased debt portfolios 17, 18 1,095,789 1,124,699
Other non-current receivables 338 458
Other non-current investments 17, 21 28 196
Total non-current assets 1,196,698 1,215,346
Current assets
Stock of secured assets 22 29,310 78,786
Accounts receivable 23 7,060 7,124
Other current assets 23 16,154 11,645
Restricted cash 24 5,798 2,946
Cash and cash equivalents
24
Total current assets
Total assets 1,293,175 1,363,627
Axactor Group66
Consolidated statement of ınancial position
For the year ended 31 December
EUR thousand Note 2021 2020
EQUITY AND LIABILITIES
Equity
Share capital 25 158,150 97,040
Other paid-in equity 269,919 236,562
Retained earnings
(40,475 )
(16,036 )
Translation reserve
(7,074 )
(15,999 )
Other reserves (245 ) -
Non-controlling interests 976 74,113
Total equity 381,249 375,680
Non-current liabilities
Interest bearing debt
17, 27
Deferred tax liabilities 12 6,144 6,436
Lease liabilities 10 8,866 2,804
Other non-current liabilities 29, 30 1,994 1,433
Total non-current liabilities 851,415 589,955
Current liabilities
Accounts payable
Current portion of interest bearing debt 17, 27 3,845 356,903
Taxes payable 12 20,259 12,002
Lease liabilities 10 2,185 2,282
Other current liabilities
30
Total current liabilities
Total liabilities
Total equity and liabilities 1,293,175 1,363,627
Oslo, 30 March 2022
The Board of Directors
Merete Haugli
Board member
Brita Eilertsen
Board member
Terje Mjøs
Board member
Lars Erich Nilsen
Board member
Kathrine Astrup Fredriksen
Board member
Hans Harén
Board member
Kristian Melhuus
Chair of the Board
Johnny Tsolis
CEO
Annual report 2021 67
Equity related to the shareholders of the parent company
Restricted Non-restricted
EUR thousand Share capital
Other paid
in capital
Translation
reserve
Other
reserves
Retained
earnings Total
Non
controlling
interest
Total
equity
Closing balance at 31 Dec 2019 81,338 201,879 (4,721 ) 2,153
Result for the period (18,131 ) (18,131 ) (15,871 ) (34,002 )
Other comprehensive income for the period (11,278 ) (58 ) (11,336 ) (11,336 )
Total comprehensive income for the period - - (11,278 ) (18,190 ) (29,467 ) (15,871 ) (45,338 )
Proceeds from non-controlling interests - (6,994 ) (6,994 )
New share issues
Cost related to share issues
(959 )
(959 ) (959 )
Share-based payment 578 578 578
Closing balance at 31 Dec 2020 97,040 236,562 (15,999 ) - (16,036 ) 301,566 74,113 375,680
Result for the period (32,797 ) (32,797 ) (13,194 ) (45,992 )
Other comprehensive income for the period
(245 )
(4 )
Total comprehensive income for the period - - 8,924 (245 ) (32,802 )
(24,123 )
(13,194 )
(37,317 )
Proceeds from non-controlling interests
(6,625 )
(6,625 )
Acquisition of remaining 50% of Axactor Invest 1 7,319 8,363 15,682 (53,317 ) (37,635 )
New share issues 61,110 27,318 88,427 88,427
Cost related to share issues (1,460 ) (1,460 ) (1,460 )
Share-based payment
Closing balance at 31 Dec 2021
(7,074 )
(245 )
(40,475 )
Consolidated statement of changes in equity
For the year ended 31 December
Axactor Group68
Consolidated statement of cash lows
For the year ended 31 December
EUR thousand Note 2021 2020
Operating activities
Proıt/(loss) before tax (40,696 ) (32,228 )
Taxes paid 12 (3,261 ) (5,515 )
Adjustments for:
- Finance income and expenses
- Portfolio amortization and revaluation 5, 18 148,542 123,179
- Cost of secured assets sold, incl. impairment 22 50,515 52,932
- Depreciation and amortization 10, 14, 16 9,654 10,838
- Calculated cost of employee share options 26 180 578
Change in working capital
Cash low from operating activities before NPL and REO investments
Purchase of debt portfolios 18 (115,402 ) (213,032 )
Sale of debt portfolio 450 2,050
Purchase of REOs 22 (193 ) (399 )
Net cash low from operating activities 109,555 (1,668 )
Investing activities
Purchase of intangible and tangible assets
14, 16
(4,718 )
(6,114 )
Interest received 5 25
Net cash low from investing activities (4,712 ) (6,089 )
Financing activities
Proceeds from borrowings
27
Repayment of debt
27
(628,681 )
(84,395 )
Interest paid (42,050 ) (48,392 )
Loan fees paid 27 (24,033 ) (4,503 )
Lease payments 10 (2,812 ) (2,898 )
New share issues 50,792 50,767
Proceeds /(repayments) from/(to) non-controlling interests (6,625 ) (6,994 )
Costs related to share issues
(1,460 )
(959 )
Net cash low from ınancing activities
(112,373 )
(15,743 )
Net change in cash and cash equivalents (7,531 ) (23,499 )
Cash and cash equivalents at the beginning of period 50,725 75,396
Currency translation
(1,172 )
Cash and cash equivalents at end of period, incl. restricted funds
Annual report 2021 69
Note 1 Corporate information 71
Note 2 Summary of signiıcant accounting principles 71
Note 3 Financial risk management objectives and policies 77
Note 4 Critical accounting estimates and judgments in terms
of accounting policies 79
Note 5 Segment reporting 82
Note 6 Income 84
Note 7 Employees, salaries and other compensations 85
Note 8 Key management compensation 86
Note 9 Other operating expenses 89
Note 10 Leases 89
Note 11 Financial items 90
Note 12 Income tax and tax assets and liability 91
Note 13 Earnings per share 92
Note 14 Intangible assets 93
Note 15 Impairment testing of intangible assets with an
indeınite life time 94
Note 16 Tangible assets 95
Note 17 Financial instruments 96
Note 18 Purchased debt portfolios 97
Note 19 Hedge accounting 99
Note 20 Shares in subsidiaries 101
Note 21 Other non-current investments 102
Note 22 Stock of secured assets, REOs 102
Note 23 Accounts receivable and other current assets 103
Note 24 Cash and cash equivalents 104
Note 25 Issued shares and share capital 104
Note 26 Share-based payment 106
Note 27 Borrowings and other interest-bearing debt 108
Note 28 Pension liabilities 110
Note 29 Other non-current liabilities 110
Note 30 Other current liabilities 111
Note 31 Transactions with related parties 111
Note 32 Purchase price allocations 111
Note 33 Pledged assets 112
Note 34 Subsequent events 112
Summary of notes to the
consolidated ınancial statements
Axactor Group70
Notes to the consolidated ınancial statements
Note 1 Corporate information
The parent company Axactor SE (publ) (“Axactor”), with Norwegian
corporate identity number 921 896 328 is a joint-stock company,
domiciled in Norway. The registered address is Drammensveien 167,
NO-0277 Oslo. The company’s shares are traded in Norway on Oslo
Børs.
The principal activities of the Company and its subsidiaries (the Group)
are debt management, specialising on both purchasing and collection
on own debt portfolios and providing collection services for third-
party owned portfolio. The activities are further described in note 5.
The Annual Report and Parent Company Report for Axactor SE (publ)
were adopted by the Board of Directors on 30 March 2022 and will
be submitted for approval to the Annual General Meeting on 21 April
2022.
Note 2 Summary of signiıcant accounting principles
2.1 Basis for the preparation
The consolidated ınancial statements have been prepared in
accordance with International Financial Reporting Standards (IFRS)
as endorsed by the European Union (EU) and effective as of 31
December 2021. Axactor also provides additional disclosures in
accordance with requirements in the Norwegian Accounting Act.
The Parent Company’s functional currency is euro (EUR) and this is
also the reporting currency for the Group. All amounts in the ınancial
reports are stated in EUR thousand unless otherwise speciıed.
As a result of rounding adjustments, the ıgures in one or more
columns may not add up to the total of that column.
Preparation of ınancial statements including note disclosures requires
management to make estimates and assumptions that affect amounts
reported. Actual results may differ. The most important accounting
principles that have been applied are described below. These prin-
ciples have been applied consistently for all years presented, unless
otherwise speciıed.
2.2 Consolidation principles
The Group’s consolidated ınancial statements comprise Axactor SE
and entities in which Axactor SE has control. The Group controls an
entity when the Group is exposed to, or has rights to, variable returns
from its involvement with the entity and has the ability to affect those
returns through its power over the entity.
There is a presumption that if the Group has the majority of the voting
rights in an entity, the entity is considered as a subsidiary. To support
this presumption and when the Group has less than a majority of the
voting or similar rights of an investee, the Group considers all relevant
facts and circumstances in assessing whether it has power over the
entity, including ownership interests, voting rights, ownership structure
and relative power, as well as options controlled by the Group and
shareholder's agreement or other contractual agreements.
The assessments are done for each individual investment. The Group
re-assesses whether it controls an entity if facts and circumstances
indicate that there are changes to one or more of the three elements
of control.
Business combinations are accounted for by using the acquisition
method. Consolidation of a subsidiary begins when the Group obtains
control over the subsidiary and ceases when the Group loses control
of the subsidiary.
Proıt or loss and each component of other comprehensive income
(OCI) are attributed to the shareholders of the parent of the Group
and to the non-controlling interests, even if this results in the
non-controlling interests having a deıcit balance. When necessary,
adjustments are made to the ınancial statements of subsidiaries to
bring their accounting policies in line with the Group’s accounting
policies. All intra-group assets and liabilities, equity, income, expenses,
and cash lows relating to transactions between members of the
Group are eliminated in full on consolidation.
Non-controlling interests are presented separately under equity in the
Group's consolidated statement of ınancial position.
Change in ownership interest without loss of control
A change in the ownership interest of a subsidiary, without a loss of
control, is accounted for as an equity transaction. The consideration is
recognized at fair value and the difference between the consideration
and the carrying amount of the asset is recognized against the equity
attributable to the parent.
Annual report 2021 71
Loss of control
In cases where changes in the ownership interest of a subsidiary lead
to loss of control, the consideration is measured at fair value. Assets
and liabilities of the subsidiary and non-controlling interest at their
carrying amounts are derecognized at the date when the control
is lost. Differences between the consideration and the carrying
amount of the asset are recognized as a gain or loss in proıt or loss.
Investments retained, if any, are recognized at fair value, and surplus
or deıcits, if any, are recognized in proıt or loss as a part of gain/loss
on subsidiary disposal. Amounts included in other comprehensive
income are recognized in proıt or loss or directly as equity depending
on their prior classiıcation in other comprehensive income.
2.3 Functional currencies and presentation currency
The ınancial statements are presented in EUR, which is the functional
currency of the Parent Company, as well as being the presentation cur-
rency for the Group. For the purposes of presenting this consolidated
ınancial statement, the assets, and liabilities of the Group’s non-euro
operations (i.e. Sweden and Norway) are translated to EUR using
exchange rates prevailing at the end of each reporting period. Income
and expense items are translated at the average exchange rates for
each month. All group transactions and group unsettled matters, and
proıt and losses for transactions between group companies that are
put into effect, are eliminated at the consolidation.
2.4 Business combination and goodwill
Business combinations are accounted for using the acquisition
accounting method. Acquisition costs incurred are expensed and
included in operating expenses. When the Group acquires a business,
it assesses the identiıable assets acquired and liabilities assumed for
appropriate classiıcation and designation in accordance with the
contractual terms, economic circumstances, and relevant conditions
as at the acquisition date. The acquirer’s identiıable assets, liabilities
and contingent liabilities that meet the conditions for recognition
are recognized at their fair values at the acquisition date, except for
non-current assets that are classiıed as held for sale and recognized at
fair value less cost to sell, and deferred tax assets and liabilities which
are recognized at nominal value.
Goodwill arising on acquisition is recognized as an asset measured at
the excess of the sum of the consideration transferred, the fair value of
any previously held equity interests and the amount of any non-con-
trolling interests in the acquire over the net amounts of the identiıable
assets acquired and the liabilities assumed. If, after reassessment, the
Group’s interest in the net fair value of the acquirer’s identiıable assets,
liabilities and contingent liabilities exceeds the total consideration of
the business combination, the excess is recognized in the income
statement immediately.
Any contingent consideration to be transferred by the acquirer will be
recognized at fair value at the acquisition date. Subsequent changes
to the fair value of the contingent consideration which is deemed to
be an asset or liability will be recognized in the income statement as
ınancial income or expense. If the contingent consideration is clas-
siıed as equity, it will not be remeasured, and subsequent settlement
will be accounted for within equity.
If the business combination is achieved in stages, the fair value of the
Group’s previously held equity interest in the acquiree is remeasured
to fair value at the acquisition date through the income statement.
For the purpose of impairment testing, goodwill acquired in a business
combination is, from the acquisition date, allocated to each of the
Group’s cash-generating units that are expected to beneıt from the
combination, irrespective of whether other assets or liabilities of the
acquired entity are assigned to those units.
The Group assesses each cash generating unit semi-annually to
determine whether any indication of impairment exists. Where an
indicator of impairment exists, a formal estimate of the recoverable
amount is made, which is considered to be the higher of the actual
value less costs to sell and value in use. If there is an indication that an
asset is impaired, the recoverable amount of the asset is calculated
in accordance with IAS 36 Impairment of Assets. For goodwill, other
intangible assets with indeınite useful lives and intangible assets not
yet ready for use, the recoverable amount is assessed annually.
2.5 Segment reporting
Axactor derives its revenues from the following operating segments:
Non-performing loans (NPL), Third-party collection (3PC) and Real
estate owned (REO). Axactor reports its business through reporting
segments which corresponds to the operating segments. Segment
proıtability and country proıtability are the two most important
dimensions when making strategic priorities and deciding where to
allocate the Group's resources. For management purposes, the Group
is in addition organised into business units based on the geographical
regions.
The internal reporting provided to the Board of Directors of Axactor,
which is the Group's chief decision maker, is in accordance with this
structure.
2.6 Revenue and revenue recognition
Revenue from NPL-portfolios is recognized according to IFRS 9
Financial instruments using the effective interest rate method, while
revenue from 3PC is recognized according to IFRS 15 Revenue from
Contracts with Customers.
The recognition of revenues from NPL portfolios is described in detail
in 2.12.1. The group can sell a NPL portfolio to another debt collector.
The revenue will be recognized at the time the portfolio is transferred
to an external buyer.
3PC revenue is derived from a combination of ıxed fees paid by
Axactor’s customers for services provided and commissions for
solved cases and/or fees paid by the debtors to an Axactor entity.
Revenue from 3PC is recognized in 'Other operating revenue' in the
consolidated statement of proıt or loss.
Revenue from REO is recognized at the point of time where the
ownership of the property has been transferred to an external buyer.
Revenue from REO is recognized in 'Other operating revenue' in the
consolidated statement of proıt or loss.
2.7 Employee beneıts
Pension obligations
The Group’s pension obligations vary between countries depending
on the local legislation and different pension systems, see notes 7, 8,
28 and 29 for further descriptions.
Deıned contribution retirement plans are retirement plans where the
company’s payment obligations are limited to the ıxed contributions
Axactor Group72
and where the fees already have been undertaken. The retirement
beneıts for the individual employee are dependent on the contribu-
tions paid to the retirement plan or an insurance company by the
employer, and the return of capital invested in the retirement fund.
Consequently, it is the employee that holds the risk of return (that the
return will be lower than expected) and the risk of the investment (the
risk that the invested pension provision will not be sufıcient to cover
expected retirement compensation in the future). The obligations of
the Group related to payments of deıned contribution retirement
plans are expensed in the consolidated statement of proıt or loss as
they are earned by the employee for services rendered on behalf of
the employer during the period.
For deıned beneıt plans, the pension obligations do not cease until
the agreed pensions have been paid. Deıned beneıt plans typically
deıne an amount of pension beneıt that an employee will receive on
retirement, usually dependent on one or more factors such as age,
years of service and compensation. The liability recognized in the
consolidated statement of ınancial position in respect of deıned ben-
eıt pension plans is the present value of the deıned beneıt obligation
at the end of the reporting period less the fair value of plan assets.
Share-based compensation
The group operates an equity-settled compensation plan, under
which the entity receives services from employees as consideration
for equity instruments (options) of the Group. The fair value of the
employee services received in exchange for the grant of the option is
recognized as an expense (payroll expenses) over the vesting period.
The total amount to be expensed is determined by reference to the
fair value of the options granted:
x Including any market performance conditions (e.g. an entity's
share price).
x Excluding the impact of any service and non-market performance
vesting conditions.
x Including the impact of any non-vesting conditions.
At the end of each reporting period, the Group revises its estimates
of the number of options that are expected to vest based on the
non-market vesting conditions and service conditions. It recognizes
the impact of the revision to original estimates, if any, in the proıt or
loss, with a corresponding adjustment to equity. The fair value of the
options has been estimated at grant date and is not subsequently
changed. When the options are exercised, and the company elects to
issue new shares, the proceeds received net of any directly attributable
transaction costs are credited to share capital (par value) and share
premium.
Social security costs related to the options are accrued on quarterly
basis. Only at the moment of exercising these social security costs will
become payable for the amount that relates to the actual exercised
number of options.
2.8 Taxes
Income taxes consists of current tax and deferred tax.
Current income tax assets and liabilities for the current and prior
periods are measured at the amount expected to be recovered from
or paid to the taxation authorities. The tax rates and tax laws used
to compute the amount are those that are enacted or substantively
enacted at the reporting date.
Deferred income tax is provided using the liability method on
temporary differences at the reporting date between the tax bases of
assets and liabilities and their carrying amounts for ınancial reporting
purposes. Deferred income tax liabilities are recognized for all taxable
temporary differences except where the deferred income tax liability
arises from the initial recognition of goodwill or of an asset or liability
in a transaction that is not a business combination and, at the time of
the transaction, affects neither the accounting proıt nor taxable proıt
or loss.
A deferred tax asset is recognized to the extent that it is probable that
future taxable proıt will be available or which unused tax losses and
unused tax credits can be utilised. A deferred tax asset arising from
unused tax losses or tax credit is only recognized to the extent that
the entity has sufıcient taxable temporary differences or that there is
convincing other evidence supporting the utilisation of the tax losses
and tax credits, including the impact of time restriction by local tax
authorities. The carrying amount of deferred tax assets are reviewed
at the end of each reporting period. Unrecognized deferred tax assets
are reassessed at each reporting date. Deferred income tax assets and
deferred income tax liabilities are offset only when a legally enforce-
able right exists to set off tax assets against income tax liabilities and
the deferred income taxes relate to the same taxable entity or taxation
authority.
2.9 Intangible assets
Expenditures for software development that can be attributed to
identiıable assets under the Group’s control and with anticipated
future economic beneıts are capitalised and recognized as intangible
assets, in accordance with IAS 38 Intangible Assets. These capitalised
expenses can include staff expenses if the resource has been taken
out of its ordinary course of work for a longer period to work on the
development project, which has been recognized as having future
economic beneıts. Customer relationships that are recognized
as ıxed assets relate to fair value recognized upon acquisition in
accordance with IFRS 3 Business Combinations. They are amortized
on a straight-line basis over their estimated period of use (3–5 years).
Other intangible ıxed assets relate to other acquired rights and are
amortized on a straight-line basis over their estimated period of use.
2.9.1 Goodwill
Goodwill represents the excess of cost of an acquisition over the
fair value of the net identiıable assets of the acquired subsidiary at
the date of acquisition. Goodwill on the acquisition of subsidiaries
is included within intangible assets. Goodwill that arises on the
acquisition of subsidiaries is allocated to cash generating units (CGUs).
Goodwill is measured at cost (residual) less accumulated impairment
losses. Goodwill is tested for impairment at least annually, or when
there are indications of impairment. Impairment is determined for
goodwill by assessing the recoverable amount of each CGU to which
the goodwill relates. When the recoverable amount of the CGU is less
than its carrying amount, an impairment loss is recognized. Impairment
losses relating to goodwill cannot be reversed in future periods. When
the Group disposes of an operation within a CGU or group of CGUs
to which goodwill has been allocated, a portion of the goodwill is
included in the carrying amount of the operation when determining
the gain or loss on disposal. The portion of the goodwill allocated is
measured based on the relative values of the operation disposed of
and the portion of the CGU retained at the date of the partial disposal,
unless it can be demonstrated that another method better relects
the goodwill associated with the operation disposed of.
Annual report 2021 73
The same principle is used for allocation of goodwill when the Group
reorganizes its businesses.
2.9.2 Customer relationships and databases
Separately acquired customer relationships and databases are initially
recognized at historical cost. The assets acquired in a business com-
bination are recognized at fair value at the acquisition date. Customer
relationships and databases have a ınite useful life and are carried at
cost less accumulated amortization. Amortization is calculated using
the straight-line method to allocate the cost over their useful lives of
3 to 6 years.
Development costs on an individual project are recognized as an
intangible asset only when there is an identiıable asset that will
generate expected future economic beneıts and when the cost of
such asset can be measured reliably, otherwise development costs are
recognized as an expense when incurred. During 2021 the Group has
continued the development of the business intelligence system and
business infrastruucture, hereunder debtor- and client portals.
2.10 Tangible ıxed assets
Tangible ıxed assets are reported at cost in the consolidated
statement of ınancial position, with a deduction for accumulated
depreciation and any impairment.Depreciation is made on a straight-
line basis over the asset’s estimated useful life, which is assessed on an
individual basis, ranging from three to six years.
2.11 Right of use assets and lease liabilities
The Group has applied IFRS 16 Leases. At the inception of a contract,
the Group assesses whether the contract is, or contains, a lease. A
contract is, or contains, a lease if the contract conveys the right to
control the use of an identiıed asset for a period of time in exchange
for consideration.
For contracts that constitute, or contain a lease, the Group separates
lease components if it beneıts from the use of each underlying asset
either on its own or together with other resources that are readily
available, and the underlying asset is neither highly dependent on, nor
highly interrelated with, the other underlying assets in the contract.
The Group then accounts for each lease component within the
contract as a lease separately from non-lease components of the
contract.
At the lease commencement date, the Group recognizes a lease
liability and corresponding right-of-use asset for all lease agreements
in which it is the lessee, except for the following exemptions applied:
x Short-term leases (deıned as 12 months or less)
x Low value assets
For these leases, the Group recognizes the lease payments as other
operating expenses in the statement of proıt or loss when they incur.
The lease liability is recognized at the commencement date of the
lease. The Group measures the lease liability at the present value of
the lease payments for the right to use the underlying asset during the
lease term that are not paid at the commencement date.
The lease term represents the non-cancellable period of the lease,
together with periods covered by an option either to extend or to
terminate the lease when the Group is reasonably certain to exercise
this option.
The lease liability is subsequently measured by increasing the carrying
amount to relect interest on the lease liability, reducing the carrying
amount to relect the lease payments made and remeasuring the
carrying amount to relect any reassessment or lease modiıcations,
or to relect adjustments in lease payments due to an adjustment in an
index or rate. The Group does not include variable lease payments in
the lease liability. Instead, the Group recognizes these variable lease
expenses in proıt or loss.
The Group presents its lease liabilities as separate line items in the
statement of ınancial position.
The Group measures the right-of use asset at cost, less any accumu-
lated depreciation and impairment losses, adjusted for any remeasure-
ment of lease liabilities.
The Group applies the depreciation requirements in IAS 16 Property,
Plant and Equipment for depreciating the right-of-use asset, except
that the right-of-use asset is depreciated from the commencement
date to the earlier of the lease term and the remaining useful life of the
right-of-use asset.
The Group applies IAS 36 Impairment of Assets to determine whether
the right-of-use asset is impaired and to account for any impairment
loss identiıed.
2.12 Financial instruments
A ınancial asset or liability is recognized in the consolidated statement
of ınancial position when the Group has a contractual commitment
regarding such an instrument. Financial instruments reported as assets
in the consolidated statement of ınancial position are included in the
line items purchased debt portfolios, other non-current receivables,
other non-current investments, accounts receivables, other current
assets, restricted cash and cash and cash equivalents. The majority
of the Group’s ınancial assets are classiıed as measured at amor-
tized cost, with the exception of derivatives which are classiıed as
measured at fair value through proıt or loss and an investment which
is classiıed as measured at fair value through OCI.
Financial instruments reported as liabilities in the consolidated state-
ment of ınancial position are included in the line items current and
non-current interest bearing debt, accounts payable, lease liabilities
and other current and non-current liabilities. The Group’s debt and
other ınancial liabilities are, with the exception of derivatives, initially
recognized at fair value, including transaction costs directly attribut-
able to the transaction, and are subsequently measured at amortized
cost. Derivative liabilities are, as derivative assets, measured at fair
value through proıt or loss.
A ınancial asset is derecognized when the contractual rights to the
cash lows from the ınancial asset expire, or when the Group has
either transferred the contractual right to receive the cash lows from
that asset or has assumed an obligation to pay those cash lows to one
or more recipients, subject to certain criteria.
Axactor Group74
A ınancial liability is derecognized when the obligation under the
liability is discharged, cancelled or expired, ususally when the Group
has paid the contractual obligation. Interest income and interest cost
are calculated using the effective interest rate method.
2.12.1 Non-performing loans (NPL)
Non-performing loans, presented as ‘Purchased debts portfolios’ in
the consolidated statement of ınancial position, consists of portfolios
of delinquent consumer debts purchased signiıcantly below nominal
value, relecting incurred and expected credit losses, and thus deıned
as credit impaired.
For non-performing loans, timely collection of principal and interest is
no longer reasonably assured at the date of purchase. Non-performing
loans are recognized at fair value at the date of purchase. Since
the loans are measured at fair value, which includes an estimate of
future credit losses, no allowance for credit losses is recorded in the
consolidated statement of ınancial position on the day of acquisition
of the loans. The loans are subsequently measured at amortized
cost according to a credit adjusted effective interest rate. Since the
delinquent consumer debt is a homogeneous group, the future cash
lows are projected on a portfolio basis.
The carrying amount of each portfolio is determined by projecting
future cash lows discounted to present value using the credit adjusted
effective interest rate as at the date the portfolio was acquired. The
total cash lows (both principal and interest) expected to be collected
on purchased credit impaired loans are regularly reviewed. Changes
in expected cash low are adjusted in the carrying amount and are
recognized in the proıt or loss as income or expense in ‘Net gain/
(loss) purchased loan portfolios’. Interest revenue is recognized using
a credit adjusted effective interest rate, included in ‘Interest revenue
from purchased loan portfolios’. The majority of the non-performing
loans are unsecured. Only an immaterial part of the loans, approximately
3% of the book value of the loans, is secured by a property object.
Estimating the timing and amount of cash lows requires signiıcant
professional judgment regarding key assumptions, including severity
of loss, amounts and timing of payment receipts. All of these factors
are inherently subjective and can result in signiıcant changes in cash
low estimates over the term of the loan. Estimated future cash low
(ERC) from the portfolios is assessed and updated regularly and at the
end of each quarter a review of the ERC is made for all the portfolios,
based on the Group's actual collection compared to the forecasted
collection over time, as well as the Group's view on the impact on the
ERC curve of several factors (see note 18) and conditions. The fact
that the claims are credit impaired reduces the presence of non-linear
effects on credit losses.
Non-performing loans that are secured by a property may have
the securing property repossessed. The assets are then transferred
internally to an owning entity at fair value. Any internal gains or losses
arising from the transaction is eliminated at group level until the asset
is sold to an external party. These assets are no longer classiıed as
non-performing loans according to IFRS 9, hence all values relating to
the asset is de-recognized from the portfolio value in the consolidated
statement of ınancial position.
All non-performing loans are classiıed as non-current assets.
2.12.2 Forward low agreements
The Group has entered into several forward low agreements to
purchase future non-performing loan portfolios, ref. note 4. These are
agreements whereby Axactor agrees to buy and the counterparty
agrees to sell future periods' ınancial assets (loans) that fulıls a set of
speciıed criteria (past due status etc.) in a number of batches over
a speciıed time period. The price at which Axactor buys the loans is
agreed when the contract is signed and can be segmented by types
of claim or size bands. The value of a forward low agreement shall
relect fair value.
Any signiıcant changes to the expected future cash low will lead to
a revaluation of the portfolio. If external factors assumed directly or
implicitly in the business case valuation change signiıcantly before the
acquisition date of one or more batches in a portfolio, so that it will
impact the value of the batch(es) through a change in the expected
future cash low from the batch(es), the change in value is recorded as
a fair value adjustment with immediate effect. The fair value adjust-
ment is recognized in the consolidated statement of proıt or loss as
'Other operating revenue'.
2.12.3 Accounts receivable
Accounts receivables are recognized initially at fair value and meas-
ured at amortized cost. Evaluation of the value of overdue accounts
receivable are based on individual judgment and/or from historical
experience.
2.12.4 Trade and other payables
Trade payables are recognized at the original invoiced amount.
Other payables are recognized initially at fair value. The payables are
measured at amortized cost.
2.12.5 Client funds
Client funds arises from cash received on collections on behalf of
a client. Collections are kept on separate restricted bank accounts
and are relected simultaneously as a liability. The funds are reported
as 'Restricted cash' and 'Other current liabilities' in the consolidated
statement of ınancial position, and shown on a separate line in note
24 and note 30.
2.12.6 Cash and cash equivalents
Cash and cash equivalents include cash at banks and on hand and
other short term highly liquid investments with original maturities of
three months or less.
2.12.7 Derivatives
Derivatives are recognized at fair value on the date the contract is
entered into and are subsequently measured at fair value. Derivatives
are designated as hedging instruments in cash low hedge relationships,
and related gains or losses are recognized as described in note 2.17.
2.13 Stock of secured assets / real estate owned (REOs)
Real estate owned consists of portfolios of properties held for sale as
a part of the ordinary course of business. The properties are acquired
exclusively with a view to subsequent resale in the near future and
getting involved in renting out is not part of the business idea. Since
Annual report 2021 75
REOs are held for sale, the Group considers the REOs as stock of
secured assets in accordance with IAS 2 Inventories and valued at the
lower of cost and net realizable value.
2.14 Provisions and contingent liabilities
Provisions are recognized when the Group has a present legal or con-
structive obligation as a result of past events, it is more likely than not
that an outlow of resources will be required to settle the obligation
and the amount can be reliably estimated. Provisions are measured
at the present value of the expenditures expected to be required to
settle the obligation using a pre-tax rate that relects current market
assessments of the time value of the money and the risks speciıc to
the obligation.
If the effect of the time value of money is material, provisions are
discounted using a current pre-tax rate that relects, when appropriate,
the risks speciıc to the liability. When discounting is used, the increase in
the provision due to the passage of time is recognized as a ınance cost.
Restructuring provisions are recognized only when the recognition
criteria for provisions are fulılled. The Group has a constructive obli-
gation when a detailed formal plan identiıes the activities concerned,
the location and number of employees affected, a detailed estimate
of the associated costs, and an appropriate timeline. Furthermore, the
employees affected have been notiıed of the plan’s main features.
2.15 Government grants
The Group has applied IAS 20 for government grants and support
received. Government grants are recognized when there is rea-
sonable assurance that the grant will be received. If conditions are
attached to the grant which must be satisıed before the Group is
eligible to receive the contribution, these conditions will be disclosed.
Government grants relating to costs are deferred and recognized in
proıt or loss over the period necessary to match them with the costs
that they are intended to compensate. Government grants relating
to the purchase of property, plant and equipment are included in
non-current liabilities as deferred income and they are credited to
proıt or loss on a straight-line basis over the expected lives of the
related assets.
2.16 Hedge accounting
The Group has elected to apply hedge accounting rules in IFRS 9.
When a hedging relationship meets the speciıed hedge accounting
criteria in IFRS 9, the Group applies hedge accounting, based on the
purpose of the hedge. Currently the Group only applies cash low
hedge accounting to mitigate the impact of changes in loating
interest rates. Derivatives are used as hedging instruments and consist
of interest rate caps.
At inception, the Group formally documents how the hedging rela-
tionship meets the hedge accounting criteria. It records the economic
relationship between the hedged item and the hedging instrument,
including the nature of the risk, the risk management objective and
strategy for undertaking the hedge, the hedge ratio determined in
the risk management strategy and the ratio in the actual hedges per-
formed and the effect of credit risk on the relationship, which cannot
dominate the value changes from the economic relationship.
For designated and qualifying cash low hedges, the effective portion
of the cumulative gain or loss on the hedging instrument is initially
recognized in OCI as net gain/(loss) on cash low hedges in other
reserves. The ineffective portion of the gain or loss on the hedging
instrument is recognised immediately in proıt or loss as a ınancial
revenue or expense. When the hedged cash low affects the proıt
or loss, the effective portion of the gain or loss on the hedging
instrument is recorded in the corresponding income or expense line.
The market value is calculated by third parties. The calculation is
based on a net present value calculation of the difference from agreed
premium and market premium at the reporting date.
To test the hedge effectiveness, the Group compares the changes in
the fair value of the hedging instruments against the changes in fair
value of the hedged items attributable to the hedged risk.
When a hedging instrument expires, is sold, terminated, exercised,
or when a hedge relationship no longer meets the criteria for hedge
accounting or the risk management objectives, any cumulative gain
or loss that has been recognized in OCI at that time remains in OCI
and is recognized when the hedged forecast transaction is ultimately
recognized in proıt or loss.
2.17 Changes in accounting policies and disclosures
implemented in 2021
Axactor has applied hedge accounting in accordance with IFRS 9
for the ırst time during 2021. Details of the hedge relationships are
described in note 19. The Group has considered the IFRIC agenda
decision 'Conıguration or Customisation Costs in a Cloud Computing
Arrangement' (IAS 38 Intangible assets) and concluded that there was
no resulting changes that needed to be accounted for as a change
in accounting policy. The amendments to IFRS 9, IAS 39, IFRS 7, IFRS
4 and IFRS 16 related to the Interest Rate Benchmark Reform – Phase
2 provide temporary reliefs which address the ınancial reporting
effects when an interbank offered rate (IBOR) is replaced with an
alternative nearly risk-free interest rate (RFR). The amendments had
no impact on the consolidated ınancial statements of the Group. In
all other respects, the accounting principles applied during 2021 are
consistent with principles applied in the previous accounting period.
No new standards or other changes in accounting policies have been
implemented during 2021.
2.18 Changes in accounting policies and disclosures for 2022
calendar year or thereafter
The new and amended standards and interpretations that are issued,
but not yet effective, are not expected to have a material impact on
the Group.
Axactor Group76
Note 3 Financial risk management objectives and policies
Axactor deınes risk as all factors which could have a negative impact
on the ability of the Group to achieve its business objectives. All
economic activities are associated with risk. Axactor’s ınancing and
ınancial risks are managed within the Group in accordance with
the ınancial policy and treasury policy established by the Board of
Directors. In order to manage risk in a balanced way, it must ırst be
identiıed and assessed. Axactor conducts risk management at both a
group and company level, where risks are evaluated and monitored in
a systematic manner. Responsibility for risk management and internal
control is an integral part of management responsibility. Risks asso-
ciated with changes in economic conditions are monitored through
on-going dialogue with each country manage ment team and through
regular checks on developments in each country.
Axactor was compliant with all covenants throughout the year.
The following summary offers an overview of all material risk factors
which are considered especially important for Axactor’s future
development.
Market risks
Axactor’s ınancing and ınancial risks are managed within the Group in
accordance with the treasury policy established and overseen by the
Board of Directors. The treasury policy contains rules for managing
ınancial activities, delegating responsibility, measuring, identifying,
and reporting ınancial risks and limiting these risks. Internal and
external ınancial operations are concentrated to the Group’s central
ınance function in Oslo, which ensures both economies in scale when
pricing ınancial transactions as well as concentration of compe-
tent resources. Because the ınance function can take advantage
of temporary surplus deıcits in the Group’s various countries of
operation, the Group’s total interest expense can be reduced. In each
country, investments, revenues, and most operating expenses are
denominated in local currencies, and thus currency luctuations have a
relatively minor effect on operating earnings. Revenues and expenses
in national currency are thereby hedged in a natural way, which limits
transaction exposure.
Regulatory risks
Regulatory risks, because of increased focus from authorities and
stricter rules e.g. MAR (market abuse regulation), AML (anti money
laundering), GDPR (general data protection regulation), debt
collection laws and BEPS (base erosion and proıt shifting), are being
monitored continuously. During the Covid-19 pandemic Axactor
has faced temporary changes in debt collection regulations in a few
countries. The debt collection industry is also facing reduction of
(regulatory) collection fees as a consequence of a more consum-
er-friendly legislation in both EU and Norway. Axactor continuously
monitors the EU’s regulatory efforts to be able to indicate potentially
negative effects for European credit management companies and to
work for favourable regulatory changes.
The ınancial effect is expected not to be material for the Group.
Interest rate risks
Interest risk is related to the risk the Group is exposed to from changes
in the market’s interest rate which can affect the net proıt. The Group’s
main interest rate risk arises from long-term borrowings with variable
rates, which amounted to EUR 838.3 million at 31 December 2021
(2020: EUR 936.2m). The loans carries a variable interest rate based on
the interbank rate in each currency with a margin. Axactor has entered
into two EUR interest caps at strike at 0,5% for the nominal amount of
EUR 200 million with 3 years duration with start mid December 2022,
in order to mitigate the effect of interest rate changes on the loating
rate bonds and applies cash low hedge accounting. The details of the
hedge relationships are described in note 2.17 and 19.
Any annualised increase by 100 basis point would decrease the
Groups proıt before tax by EUR 7.0 million. (2020: EUR 9.4m). At
31 December 2021, the 3 months EURIBOR was negative. Hence,
any annualised decrease would not affect the Group's proıt. The
average interest rate in 2021 was 6.2% (2020: 6.2%).
Currency risk
Currency risk refers to the risk that the value of liquid and ınancial
instruments may shift because of changes in currencies’ conversion
rates. Much of the Groups business operation is taking place in euro
countries. The Group’s functional currency is therefore held in euro.
However, some of its business operations is in non-euro countries like
Norway and Sweden. This foreign exchange exposure may affect the
Company’s results and the value of monetary assets.
When the ınancial position of foreign subsidiaries are recalculated
in EUR, a translation exposure arises that affects consolidated share-
holders’ equity. This translation exposure is limited by raising loans in
foreign currencies, stated as the aforementioned countries.
Credit risk
Credit risks is the risk that the counterparty will not meet its obliga-
tions under a ınancial contract or customer contract, leading to a
ınancial loss. The Group is exposed to credit risk from its operating
activities, primarily related to purchased debt and trade receivablies.
Customer credit risk is managed subject to established policies,
procedures and controls relating to customer credit risk management.
The maximum exposure to credit risk at the reporting date is the
carrying value of each class of ınancial assets.
The credit risk (excluding purchased debt) is not considered to be a
material risk in Axactor.
Risk inherent in purchased debt
To minimize the risks in this business, caution is exercised in purchase
decisions. The focus is small and medium-sized portfolios with rela-
tively low average amounts, to help spread risks. The acquisitions gen-
erally involve unsecured debt, which reduces the capital investment
and signiıcantly simpliıes administration compared with collateralised
receivables. Purchased debt portfolios are usually purchased at prices
signiıcantly below the nominal value of the receivables, and Axactor
retains the entire amount collected, including interests and fees.
Axactor places high yield requirements on purchased debt portfolios.
Before every acquisition a careful assessment is made with a projection
of future cash lows (collected amount) from the portfolio. In its
calculations, Axactor is aided by scoring models and historical data.
Annual report 2021 77
Scoring entails, the debtor's payment capacity being assessed through
statistical analysis. The historical data is used to assess the impact on
future cash lows of external factors and events. In addition, Axactor
uses specialised industry consultants to get a second opinion on con-
templated debt portfolios purchases. Axactor is therefore comfortable
that it has the expertise required to evaluate the purchased debt.
Liquidity risk
Liquidity risk is the potential loss arising from the Group’s inability to
meet its contractual obligations when due. The Group monitors its risk
of a shortage of funds using cash low forecasts regularly. The driver
of negative cash low from operating activities is investments in NPL
portfolios. These investments can be scaled down relatively quick, as
evident by the 46% reduction in investments in NPL portfolios from
2020 to 2021. The Group generates positive cash low from operating
activities before NPL and REO investments. The Group had cash and
cash equivalents of EUR 44.0 million at 31 December 2021 (2020: EUR
50.7 million).
The following table details the Group’s undiscounted remaining con-
tractual maturity for its non-derivative ınancial liabilities with agreed
repayment periods. For forward low NPL agreements, expected
cash lows are presented. The maturity calculation is made under the
assumption that Axactor has a constant RCF draw in the period. The
table includes both interest and principal cash lows. To the extent that
interest lows are loating rate, the undiscounted amount is derived
from the interest rate curves at the end of the reporting period. The
contractual maturity is based on the earliest date on which the Group
may be required to pay.
The amounts presented are subject to change dependent on a change
in variable interest rates.
Year ended 31 December 2021
EUR thousand Q1-22 Q2-22 Q3-22 Q4-22 1- 2 years 2- 4 years 4+ years Total
Forward low NPL agreements, non-cancellable
1) 2)
34,597
19,938
19,420
21,092
31,984
-
-
127,030
Forward low NPL agreements, cancellable
1) 2)
- 8,992 7,116 6,300 45,600 17,349 - 85,357
Revolving credit facility DNB/Nordea 2,772 2,772 2,772 2,772 363,064 - 374,152
Bond (ISIN: NO0010914666) 3,578 3,500 3,539 3,578 14,194 203,578 - 231,967
Bond (ISIN: NO0011093718) 4,013 4,102 4,102 4,057 16,273 32,590 312,216 377,352
Other non-current liabilities
-
-
-
-
-
-
1,994
1,994
Accounts payable
7,282
-
-
-
-
-
-
7,282
Other current liabilities 23,177 3,764 - - - - - 26,939
Total 75,418 43,067 36,948 37,799 471,115 253,517 314,210 1,232,074
1) Ref note 2.12.2
2) Expected cash lows. Cash lows are limited to EUR 308.5 million by contracted capex limits
See note 10 for contractual maturities of lease liabilities and note 18 for expected incoming cash low (ERC) from NPL portfolios
Year ended 31 December 2020
EUR thousand Q1-21 Q2-21 Q3-21 Q4-21 1- 2 years 2- 4 years 4+ years Total
Forward low NPL agreements
1) 2)
12,702 12,205 9,636 7,173 21,518 - - 63,234
Revolving credit facility DNB/Nordea 20,139 22,312 18,446 20,996 73,434 254,588 - 409,915
Interest bearing loans Italy 1,945 2,665 3,331 3,294 12,125 16,454 2,400 42,215
Interest bearing loans Nomura 7,515 6,806 6,465 3,790 - - - 24,576
Bond (ISIN: NO0010819725)
200,311
-
-
-
-
-
-
200,311
Interest bearing A & B notes
-
-
-
-
140,000
-
-
140,000
Interest bearing loans DNB/Nordea
(Axactor Invest 1) 7,502 8,651 13,635 10,382 34,436 45,845 - 120,450
Other non-current liabilities - - - - - - 1,433 1,433
Accounts payable 6,148 - - - - - - 6,148
Other current liabilities 16,112 4,159 386 - - - - 20,657
Total
272,373
56,798
51,900
45,635
281,513
316,887
3,833
1,028,939
1) Ref note 2.12.2
2) Expected cash lows. Cash lows are limited to EUR 102.6 million by contracted capex limits
The Group manages the liquidity risk by continuously monitoring
the liquidity status and the monthly rolling consolidated result- and
cash low forecasts. The Group has no contractual maturity on loan
repayments for the next 12 months. Hence, the contractual maturity of
loans presented as less than 1 year (41.5 million) represents estimated
interest payments.
The cash low from operating activities in future years will positively
be affected by the investment levels during 2018-2021. Together with
the Group’s RCF and bond loans this will meet the future payment obli-
gations. The Group had an unused part of the RCF agreement of EUR
193 million, an uncommitted accordion option of EUR 75 million, in
addition to unrestricted cash and cash equivalents of EUR 38.2 million.
Axactor Group78
Axactor was compliant with all covenants throughout the year.
Based on the above described cash situation, the drawing capacity
together with the cash generation from operations the Group
assesses the liquidity to be sufıcient to meet the obligations and
sufıcient lexible to meet future investment priorities.
Financing risk
To support the Group's growth ambitions, the Group continuously work
on securing necessary committed ınancing and alternative funding
sources. Securing non-current ınancing at competitive terms is a major
part of the Group’s long-term liquidity planning. Short term ınancing risk
would be changes in market conditions and or business performance
that limits the Group's ability to source funding at competitive terms.
Capital management
The primary objective of the Group’s capital management is to ensure
the Company maintains a solid capital structure enabling it to develop
and build its business to maximise shareholder value. The Group’s
objective is to maintain a balance of ınancial assets that relects the
cash requirement of its operations and investments for the next 12-24
months. No change was made in the objectives, policies, or process
for managing capital during the year ended 31 December 2021.
Update on process with FSA
As communicated in a press release on 13 December 2021, Axactor SE
has received a conclusion from the Norwegian Financial Supervisory
Authority (FSA) in accordance with the preliminary conclusion as
stated in the press release of 2 September 2021. The FSA requires that
the company expands its valuation model for portfolios of non-per-
forming loans (NPL) with more input variables capturing current
and future macroeconomic conditions and use of scenarios with
effect from the reporting of the annual accounts for the ınancial year
2022. The company takes notice of the conclusion from FSA and will
implement the requested changes accordingly.
The estimation of future cash low is affected by several factors,
including general macro factors, market speciıc factors, portfolio
speciıc factors and internal factors. Axactor is already considering
relevant macro factors and market speciıc factors when estimating
future cash low but not as direct input generating output in the
forecast models. Portfolio speciıc factors and internal factors are
considered to affect the estimation of future cash low signiıcantly
more than changes in general macro factors and market speciıc
factors. The company takes notice of the conclusion from the FSA and
has started the work on expanding the portfolio valuation model to
better relect the macro factors and scenarios as required. The com-
pany has initiated testing to identify the impact of macroeconomic
factors on collection performance. So far, regression analysis has
rejected macroeconomic factors as prediction variables for collection
performance. The company will continue to reıne the analysis with
the aim to identify any variance explained by macroeconomic factors.
The company has implemented requirements for documentation
of the relevant macroeconomic assumptions in portfolio acquisition
processes. The company considers interest rate, unemployment, GDP
growth, housing price growth, inlation, salary growth and regulation
changes to be the most relevant macroeconomic factors. The
company will have the expanded model implemented with effect for
the annual accounts for 2022.
The notice from the FSA also requires the company to conduct a new
measurement of one speciıc NPL portfolio as of 2019 and onwards.
The company is required to document the use of reasonable and sup-
portable assumptions for estimates of future credit losses occurring
after 2026. The company has performed a new measurement with
the information available at the end of 2019 and an external valuation
agency has provided a benchmark valuation to verify the internal
measurement. Based on the updated measurement, the company
has booked an impairment of EUR 1.8 million in the fourth quarter of
2021. The error is related to 2019, but is regarded as not material and a
retrospective restatement has not been made, in accordance with IAS
8 Accounting Policies, Changes in Accounting Estimates and Errors.
Note 4 Critical accounting estimates and judgments in terms of accounting policies
The preparation of the consolidated ınancial statements in conformity
with IFRS requires the use of certain critical accounting estimates and
assumptions that affect the reported amounts of revenue, expenses,
assets and liabilities, and the accompanying disclosures, and the
disclosures of contingent liabilities. It also requires management to
exercise its judgment in the process of applying the Group's account-
ing policies. Uncertainty about these assumptions and estimates could
result in outcomes that require a material adjustment to the carrying
amount of assets or liabilities affected in future periods. Estimates
and judgments are continually evaluated and are based on historical
experience and other factors, where, e.g., the effect of the Covid-19
pandemic impact has been considered and expectations of future
events that are believed to be reasonable under the circumstances.
Critical accounting estimates and assumptions
The Group makes estimates and assumptions concerning the future.
The resulting accounting estimates will, by deınition, seldom equal
the related actual results. The Group based its assumptions and
estimates on parameters available when the ınancial statements
were prepared. Existing circumstances and assumptions about future
developments, however, may change due to market changes or
circumstances arising beyond the control of the Group. Such changes
are relected in the assumptions when they occur. The estimates and
assumptions that have signiıcant risk of causing a material adjustment
to the carrying amounts of assets and liabilities within the next ınancial
year are addressed below.
Revenue recognition of NPL Portfolios
The Group uses the credit-adjusted effective interest rate method to
recognize revenue for portfolios of purchased credit impaired loans.
The use of the credit-adjusted effective interest rate method requires
the Group to estimate future cash lows from the NPL portfolios at
each reporting date. The underlying estimates that form the basis for
revenue recognition depend on variables such as the ability to contact
Annual report 2021 79
the debtor and reach an agreement, timing of cash lows, general
economic environment, and statutory regulations. If the estimations
are revised, the Group adjusts the carrying amount of the portfolios and
loans to relect actual and revised estimated cash lows in accordance
with IFRS 9.5.5.14. Events or changes in assumptions and managements
judgment will affect the recognition of revenue in the period.
Book value of NPL portfolios
Non-performing loans presented as ‘Purchased debt portfolios’ in
the consolidated statement of ınancial position consist of acquired
non-performing (credit impaired) unsecured loans. Such assets are
recognized at amortized cost using the effective interest method.
Changes in assumptions and management's professional judgment
will affect the expected cash low for the portfolios and therefore also
the net present value of future cash lows and the book value of the
portfolios, see note 18.
The Group determines the carrying value by calculating the present
value of estimated future cash lows at the receivables’ initial effective
interest rate. Adjustments are recognized in the income statement.
The valuation method provides the best estimate of the fair value of
debt portfolios.
The carrying value of purchased loans and receivables recognized at
amortized cost does not perfectly match the fair value determined by
discounting the net cash low i.e. the gross cash receipts reduced by the
cost to collect and tax costs discounted with a market-based discount
rate at every end of the reporting period. The method and result of the
fair value estimation at 31 December are described below and shows
a non-signiıcant deviation between the two valuation methods. The
method falls within level 3 of the fair value hierarchy, ref note 17.
Fair value estimation of NPL portfolios
The fair value of ınancial instruments that are not traded in an
active market (e.g. NPL portfolios) is determined by using valuation
techniques such as net present value of estimated cash lows. For
NPL portfolios, the discount rate used is the weighted average cost of
capital, which is the weighted value of the Group’s cost of debt and the
cost of equity. The cost of equity is estimated by applying the capital
asset pricing model. The Group has assumed that this WACC is the
same as the market would use, in order to get to the fair value of the
portfolios.
The preparation of cash low estimates requires signiıcant estimates
to be made by management regarding future cash lows from
portfolios. The estimated future portfolio cash lows are reviewed
by management each quarter considering the current collection
environment. The fair value is estimated to approximately EUR 1,238
million (2020: EUR 1,248 million) and is based on net future estimated
cash lows after tax, discounted with the estimated WACC. The cor-
responding carrying amount is EUR 1,096 million. (2020: 1,125 million),
which is based on IFRS 9 using the estimated gross future cash lows,
where the discount factor is the individual credit-adjusted effective
interest rate for each portfolio.
The fair value estimation is based on estimated net cash lows from
portfolios. The estimated net cash lows from portfolios are the
assumed future collection on portfolios per country, less assumed
collection costs per portfolio before tax. Collection costs consist of
operational costs in the portfolio segment, i.e. commission to debt col-
lection, payroll expenses, premises, communication costs, depreciation,
and other costs directly attributable to the debt purchasing segment.
The collection costs as a percentage of the portfolio collection differ
from portfolio to portfolio, ranging from less than 10% to over 50%. In
addition, the country speciıc marginal tax rate is applied. This individual
collection cost and tax rate is applied to each portfolio’s estimated future
cash low, adding up to an estimated total net cash low for the Group.
The weighted average cost of capital after tax for the portfolio segment
is estimated to 5.8% (2020: 5.4%) at 31 December 2021 (details of the
calculation is shown below). Based on this rate, the discounted value of
the estimated net cash lows indicates that the fair value of portfolios is
approximately EUR 1,238 million (2020: 1,248 million). To evaluate this
calculation, a sensitivity analysis of the cash low estimates is presented
in the table below to show the effect of deviations from the cash low
estimates and variations in the cost of capital.
Fair value sensitivity table
Performance
EUR million 90% 95% 100% 105% 110%
WACC
4% 1,214 1,279 1,345 1,410 1,476
5% 1,117 1,178 1,238 1,299 1,359
9% 1,014 1,069 1,124 1,179 1,234
10% 973 1,026 1,079 1,132 1,184
11%
935
986
1,037
1,088
1,139
12%
900
949
998
1,047
1,096
13% 868 915 962 1,010 1,057
The cost of capital after tax for the portfolio segment is calculated using the capital asset pricing model (CAPM) in combination with the weighted
average cost of capital (WACC). Based on the variables from the table below, the estimated cost of capital after tax is approximately 5.8%.
Axactor Group80
Cost of equity
2021 2020
Risk-free rate (0.479%) (0.724%)
5 year euro area tripple A rated government bonds,
as reported by the European Central Bank
Market risk premium 4.7% 4.7% Damodaran 6 January 2022
Estimated beta (equity)
2.07
1.76
Observed beta for Axactor
Company speciıc premium
6.0%
6.0%
Ibbotson research 2014
1)
Cost of equity before tax 8.8% 8.1%
WACC 5.8% 5.4%
1) Latest data available. The Group considers this to be the best estimate to be available
Risk free rate
The risk-free rate used in the calculation of the WACC is based on
EUR risk-free interest rate, which at 31 December was priced at
negative 0.479%. Most of the Group’s cash low is in EUR, although the
Group has some part of the cash lows in other currencies, the largest
being NOK and SEK. Calculating a currency speciıc WACC, the risk-
free rate element would have increased the WACC slightly compared
to the WACC estimated for the Group.
Risk premium
Based on empirical research done the long-term risk premium is
about 4-6%. It is reasonable to assume that the risk of investing in
non-performing loan portfolios is in the higher end of the observed
average market risk premium. Therefore, a company risk premium of
6% is added to the calculation. These risk premiums are based on the
research found by Ibbotson risk premiums over time report.
Equity beta
The equity beta is based on ıve years of monthly observations for
the Axactor share. The calculations are based on data from Reuters.
Thereafter this is used as a basis for the beta used to calculate cost of
equity for Axactor.
Cost of debt
The average cost of debt for 2021, deıned as the loan interest in
the loan agreements divided by the individual loan balances at 31
December, is 6.9% (2020: 6.9%).
Future cash low estimates
The future cash low estimates are based on the current 15-year IFRS
forecast for the current asset base with no value after this 15-year
period. Therefore, there are no adding cash lows from future invest-
ments included in the fair value estimation.
See note 18 for further details.
Goodwill
In accordance with the stated accounting policy, the Group annu-
ally tests whether goodwill has suffered any impairment or more
frequently if impairment indicators are identiıed. The recoverable
number of cash-generating units has been determined based on
value-in-use calculations. These calculations require the use of
estimates. The value-in-use calculation is based on a discounted cash
low model. The cash lows are derived from the ıve years business
plan approved by the board of directors, and do not include signiıcant
investments that will enhance the performance of the CGU being
tested, except from already committed. The recoverable amount
is most sensitive to the discount rate used for the discounted cash
low model, as well as the expected future cash-inlows (sensitive
to estimates of sales and cost levels) and the growth rate used for
extrapolation purposes. Further details about goodwill and impairment
reviews are included in note 15 Impairment.
Annual report 2021 81
Note 5 Segment reporting
Axactor delivers credit management services and the Group's
revenue is derived from the following three operating segments:
Non-performing loans (NPL), Third-party collection (3PC) and Real
estate owned (REO). Axactor’s operations are managed through these
three operating segments.
The NPL segment invests in portfolios of non-performing loans.
Subsequently, the outstanding debt is collected through either
amicable or legal proceedings.
The 3PC segment’s focus is to perform debt collection services on
behalf of third-party clients. The operation segment applies both
amicable and legal proceedings in order to collect the non-performing
loans, and typically receive a commission for these services. Other
services provided include, amongst other, helping creditors to prepare
documentation for future legal proceedings against debtors, handling
of invoices between the date and the default date and sending out
reminders. For these latter services, Axactor typically receive a ıxed fee.
The REO segment relates to the investment in real estate assets held
for sale. The stock of secured assets was EUR 29.3 million per 31
December 2021 (2020: EUR 78.8 million), see note 22. As of 1 January
2022, the REO segment is considered as discontinued operation and
will be reported separately.
Axactor reports its business through reporting segments which
correspond to the operating segments. Segment revenue reported
represents revenue generated from external customers. Segment
proıtability and country proıtability are the two most important
dimensions when making strategic priorities and deciding where to
allocate the Group’s resources.
The accounting policies of the reportable segments are the same
as the Group’s accounting policies described in note 2. Segment
contribution margin represents contribution margin earned by
each segment without allocation of management fee, central
administration costs, other gains and losses as well as ınance costs.
The measurement basis of the performance of the segment is the
segment’s contribution margin.
Year to date 31 December 2021
EUR thousand NPL 3PC REO
Eliminations/
Not allocated Total
Collection on own portfolios
254,949
-
39,846
-
294,795
Portfolio amortization and revaluation (148,542) - - - (148,542)
Other operating revenue/income:
-Change in forward low derivatives (782) - - - (782)
-Other operating revenue and other income
-
49,640
-
15
49,655
Total income
105,625
49,640
39,846
15
195,127
REO cost of sales - - (44,601) - (44,601)
Impairment REOs - - (5,915) - (5,915)
Direct operating expenses (36,168) (34,235) (5,865) - (76,269)
Contribution margin 69,456 15,405 (16,534) 15 68,342
SG&A, IT and corporate cost (44,609)
(44,609)
EBITDA
23,733
Amortization and depreciation (9,654) (9,654)
Operating proıt 14,080
Total operating expenses
(36,168)
(34,235)
(56,380)
(44,609)
(171,393)
Contribution margin (%) 65.8% 31.0% (41.5%) na 35.0%
EBITDA margin (%) 12.2%
Opex ex SG&A, IT and corp.cost / Gross revenue 14.2% 69.0% 141.5% na 36.8%
SG&A, IT and corporate cost / Gross revenue 13.0%
Axactor Group82
Year to date 31 December 2020
EUR thousand NPL 3PC REO
Eliminations/
Not allocated Total
Collection on own portfolios 236,459 - 40,407 - 276,866
Portfolio amortization and revaluation (123,179) - - - (123,179)
Other operating revenue/income:
-Change in forward low derivatives
(826)
-
-
-
(826)
-Other operating revenue and other income - 48,290 - 24 48,315
Total income 112,454 48,290 40,407 24 201,175
REO cost of sales - - (36,818) - (36,818)
Impairment REOs - - (16,114) - (16,114)
Direct operating expenses (37,174) (30,938) (8,433) -
(76,546)
Contribution margin
75,280
17,352
(20,958)
24
71,698
SG&A, IT and corporate cost (39,699) (39,699)
EBITDA 31,999
SG&A, IT and corporate cost
(10,838)
(10,838)
Operating proıt
21,161
Total operating expenses (37,174) (30,938) (61,365) (39,699) (169,176)
Contribution margin (%) 66.9% 35.9% (51.9%) na 35.6%
EBITDA margin (%) 15.9%
Opex ex SG&A, IT and corp.cost / Gross revenue
15.7%
64.1%
151.9%
na
39.8%
SG&A, IT and corporate cost / Gross revenue 12.2%
Annual report 2021 83
Note 6 Income
The Group operates in seven European countries: Finland, Germany,
Italy, Luxembourg, Norway, Spain, and Sweden. Apart from in
Luxembourg, Axactor delivers credit management services in all
countries. Axactor’s activities in Luxembourg are limited to investing
services for the Group.
The Group’s revenue from continuing operations from external
customers by location of operations and information about its
non-current assets by location of assets are detailed below.
The information in the table presented is based on the location of the
debtors and the country of the company performing the collection
(which correspond). This is not necessarily the same as the country
owning the portfolio. The same principle is used for the allocation of
the non-current assets.
Geographical information
Total income Non-current assets
1)
2021 2020 2021 2020
Finland
10,113
10,710
4,052
4,539
Germany 30,331 31,964 15,884 13,497
Italy 17,387 14,424 9,184 9,720
Norway 35,271 37,949 36,088 33,004
Spain 95,837 87,962 17,519 19,176
Sweden
6,187
18,165
4,115
2,286
Total
195,127
201,175
86,843
82,223
1) Non-current assets consists of intangible assets, goodwill, property, plant and equipment and right-of-use assets.
Portfolio revenue
Portfolio revenue is recognized as 'Interest revenue from purchased loan portfolios' and 'Net gain/(loss) purchased loan portfolios' in the
consolidated statement of proıt or loss and can be split further down as follows:
EUR thousand Yield
1)
CU1
2) 5)
CU2
3) 5)
CU2 tail
4) 5)
Net revenue
2021
Finland 14,931 (1,728) (3,817) - 9,385
Germany 21,612 (1,223) (671) 442 20,160
Italy
16,023
(272)
(816)
133
15,067
Norway
36,889
(5,932)
(4,343)
1,614
28,230
Spain 44,911 (1,605) (15,700) 1,111 28,716
Sweden 34,055 (7,107) (24,465) 2,367 4,849
Total 168,421 (17,867) (49,812) 5,666 106,407
EUR thousand Yield
1)
CU1
2)
CU2
3)
CU2 tail
4)
Net revenue
2020
Finland
14,727
(2,155)
(3,218)
-
9,353
Germany 23,015 (2,260) 355 595 21,705
Italy 16,996 (1,776) (3,559) 275 11,936
Norway 29,703 1,997 (4,032) 1,775 29,443
Spain 47,790 (2,427) (23,574) 978 22,767
Sweden
30,864
(6,325)
(8,728)
2,266
18,076
Total
163,093
(12,945)
(42,755)
5,888
113,280
1) 'Interest revenue from purchased loan portfolios' in the consolidate statement of proıt or loss
2) Catch up 1. Over- or underperformance compared to collection forecast
3) Catch up 2. Revaluations and net present value of changes in forecast
4) Catch up 2 tail. The net present value effect of rolling 180 months forecast, except for Finland who is limited to 180 months from legal date
5) The sum of CU1, CU2 and CU2 tail equals 'Net gain/(loss) purchased loan portfolios' in the consolidated statement of proıt or loss.
Axactor Group84
Note 7 Employees, salaries and other compensations
Personnel expenses
EUR thousand 2021 2020
Salaries
39,862
36,991
Bonus
4,036
3,557
Commission 2,210 1,822
Social contribution 10,047 9,340
Pension cost 1,489 1,320
Share option program 180 580
Other beneıts
3,489
1,262
Total personnel expenses 61,313 54,872
In 2020, the Group received EUR 1.2 million in government assistance related to the Covid-19 pandemic. The assistance was related to support
of employee costs and was hence recognized as a reduction of personell expenses. No support was received for 2021.
Average number of employees
2021 2020
Number of FTE's, start of year
1,128
1,152
Number of FTE's, end of year 1,096 1,128
Average number of FTE's 1,112 1,140
Number of FTE's at end of year, per country
2021 2020
Finland
42
57
Germany 148 187
Italy 104 103
Norway 111 121
Spain 628 614
Sweden
64
45
Total number of FTE's
1,096
1,128
Post-employment beneıts
EUR thousand 2021 2020
Salaries
302
742
Share option program - -
Other beneıts - 1
Total post-employment beneıts 302 743
Axactor Group is compliant with the different local mandatory occupational pension requirement. For information on the country speciıc
pension schemes, see note 28.
The Group has not received government assistance in 2021, neither related to Covid-19 or other government assistance. In 2020, the Group
received government assistance as result of the Covid-19 pandemic for operations in Spain, Norway, Germany, Sweden, and Italy. The type and
nature of ınancial support was different from country to country. All received assistance was related to support of employee costs.
Annual report 2021 85
Overview of received government assistance
EUR thousand 2021 2020 Nature of assistance Unfulılled conditions
Finland - - na na
Germany - 121 Short time allowance No
Italy
-
129
Temporary lay off scheme
No
Norway
-
47
Reduction social security
No
Spain - 906 Temporary workforce reduction program No
Sweden - 7 Reduction social security No
- 1,208
Note 8 Key management compensation
Board of Directors remuneration
EUR thousand 2021 2020
Glen Ole Rødland
2)
27
44
Bjørn Erik Næss
-
34
Kristian Melhuus
1)
10 -
Lars Erich Nilsen 41 47
Kathrine Astrup Fredriksen 41 28
Merete Haugli
3)
54 41
Terje Mjøs 45 44
Brita Eilertsen
47
50
Hans Harén
41
21
Beate S. Nygårdshaug
1)
- 13
Total 306 322
1) Member until 2020
2) Chair of the board until May 2021
3) Interim chair of the board from May 2021 until February 2022
4) Chair of the board from February 2022
The following remuneration has been made to the members of the nomination committee during the year:
Nomination committee
EUR thousand 2021 2020
Anne Lise Ellingsen Gryte
1)
-
-
Magnus Tvenge - 3
Cathrine Loferød Feght
2)
- 3
Robin Bakken
2)
- 4
Total
-
10
1) Member from April 2020
2) Member until April 2020
Axactor Group86
Executive management remuneration 2021
EUR thousand Salary Bonus Pension Other Share option
1)
Total
Johnny Tsolis, CEO 410 87 35 1 39 573
Endre Ragnses, CEO
2)
- 44 - - - 44
Nina Mortensen, CFO
3)
92 20 7 1 -
120
Teemu Alaviitala, CFO
4)
44
16
2
-
-
61
Arnt Andre Dullum, COO 178 18 16 2 17 230
Oddgeir Hansen, COO
5)
46 133 - - - 179
Kyrre Svae, Chief Strategy and IR 185 49 14 2 8 257
Vibeke Ly, Chief of Staff 199 29 14 1 17 261
Robin Knowles, Chief Investment Ofıcer
297
25
3
-
19
344
Steffen Fink, Country Manager Germany
260
24
-
44
5
334
Andres Lopez, Country Manager Spain 265 50 - 13 30 357
David Martin, Country Manager Spain
6)
177 50 - 9 - 236
Lisa Sohtell, Country Manager Sweden 203 19 75 2 26 325
Stina Koren, Country Manager Norway 208 31 7 1 25 271
Antonio Cataneo, Country Manager Italy 170 15 - 12 24 221
Heidi Piispanen, Country Manager Finland 175 53 40 7 5
279
Total
2,909
662
214
93
215
4,093
1) Cost in relation to share option program, not exercised
2) CEO until 3 April 2020
3) CFO from 1 August 2021
4) CFO until 31 January 2021
5) COO until 1 July 2020
6) Country Manager Spain until 14 July 2021
Annual report 2021 87
Executive management remuneration 2020
EUR thousand Salary Bonus Pension Other Share option
1)
Total
Johnny Tsolis, CEO
2)
336 109 6 1 72 524
Endre Rangnes, CEO
3)
700 329 6 - (45) 991
Teemu Alaviitala, CFO
4)
72 - 3 - 4
78
Arnt Andre Dullum, COO
5)
72
-
3
-
29
104
Oddgeir Hansen, COO
6)
270 94 6 - (25) 346
Kyrre Svae, Chief Strategy and IR
7)
72 - 3 - 4 78
Vibeke Ly, Chief of Staff 169 37 6 - 25 238
Siv Farstad, EVP HR
8)
102 - 3 - (20) 84
Robin Knowles, Chief Investment Ofıcer
259
91
3
1
36
390
Steffen Fink, Country Manager Germany
234
18
-
12
3
267
Andres Lopez, Country Manager Spain 244 63 - 50 52 408
David Martin, Country Manager Spain 244 63 - 50 52 408
Lisa Sohtell, Country Manager Sweden 202 82 - 9 45 338
Stina Koren, Country Manager Norway 164 75 6 2 40 287
Antonio Cataneo, Country Manager Italy 201 95 10 - 38 344
Heidi Piispanen, Country Manager Finland
9)
15 - 2 - -
17
Jarkko Jalonen, Country Manager Finland
10)
123
70
35
-
40
267
Total 3,476 1,125 94 126 348 5,170
1) Cost in relation to share option program, not exercised
2) CFO until 26 June 2020, interim CEO from 3 April 2020, permanent CEO from 26 June 2020
3) CEO until 3 April 2020
4) CFO from 1 August 2020 until 31 January 2021
5) COO 50% from 19 May 2020, 100% from 1 September 2020
6) COO until 1 July 2020
7) Chief of Stategy and IR from 1 August 2020
8) Head of HR until 31 March 2020
9) Country Manager Finland from 4 December 2020
10) Country Manager Finland until 3 December 2020
The CEO, Johnny Tsolis, has a six-month notice period and is entitled to a severance pay of six months in case of termination by the company. In
addition, there is a non-compete and non-solicitation clause in the employment agreement. The country managers are entitled to severance pay
from three to twelve months.
The share-based option program is presented in note 26. Bonus stated in tables above relects the paid amounts during the year. At the end of
2021 no loan or prepayments were granted to Board of Directors and executive management.
Members of the executive management employed in Axactor SE has an additional contribution pension entitling them to pension rights for salary
over 12G (Norwegian Grunnbeløp).
Axactor Group88
Note 9 Other operating expenses
Other operating expenses
EUR thousand 2021 2020
Direct operating expenses
9,066
9,597
External services
32,321
32,949
IT expenses 11,496 11,976
Restructuring cost 1,591 1,277
Other operating expenses 5,091 5,573
Total other operating expenses
59,565
61,372
Remuneration to company auditors
PricewaterhouseCoopers
EUR thousand 2021 2020
Fees, auditing
966
780
Fees, audit related services
26
-
Fees, tax advisory 114 33
Fees, other services 72 119
Total fees, PwC 1,179 932
Note 10 Leases
The Group leases premises, ofıce equipment and vehicles under non-cancellable lease agreements. The lease terms are between 1-6 years and
the majority of lease agreements are renewable after the end of the lease period. No periods covered by an option to extend the lease has not
been included in the lease term, as the Group is not reasonably certain to exercise the individual options. Leasing contracts are classiıed as lease
liabilities and right-of-use assets under IFRS 16, see note 2, section 2.11.
Right-of-use assets
EUR thousand Buildings Vehicles Other Total
Right-of-use assets at 1 Jan 2020
5,039
541
267
5,846
New leases 1,421 780 - 2,201
Depreciation of the year (2,358) (502) (187) (3,048)
Disposals (94) (18) - (112)
Currency exchange effects
(58)
(3)
-
(61)
Right-of-use assets at 31 Dec 2020
3,949
797
80
4,826
New leases
9,333
107
51
9,491
Depreciation of the year (2,503) (346) (80) (2,929)
Disposals (484) (84) (4) (572)
Currency exchange effects (48) 1 - (48)
Right-of-use assets at 31 Dec 2021 10,247 475 46 10,768
Remaining lease term 1-6 years 1-4 years 1-3 years
Depreciation method
Linear
Linear
Linear
Annual report 2021 89
The Group had new leases of EUR 9.3 million in 2021, mainly relating to new ofıces in Germany, Norway and Sweden. The interest costs relating to
IFRS 16 Leases during the year are relected in the proıt and loss statement with EUR 366 thousand (EUR 334 thousand). The interest rate used for
discounting the lease liability is based on the interest rate from the Group's external ınancing.
Lease liabilities
EUR thousand 2021 2020
Lease liabilities at 1 Jan
5,086
6,029
New leases, modiıcations and terminations 8,812 1,995
Lease payments (2,812) (2,898)
Currency exchange effects (35) (40)
Lease liabilities at 31 Dec 11,051 5,086
Current
2,185
2,282
Non-current
8,866
2,804
The future aggregated minimum lease payments under lease liabilities are as follows:
EUR thousand 2021 2020
< 1 year
2,717
2,496
1-2 years 2,511 1,396
2-3 years 2,065 1,027
3-4 years 1,821 368
4-5 years 1,800 125
> 5 years
2,100
78
Total undiscounted lease liabilities, end of period
13,015
5,492
Discount element
(1,964)
(405)
Total discounted lease liabilities, end of period 11,051 5,086
Note 11 Financial items
EUR thousand 2021 2020
Financial revenue
Interest on bank deposits
5
25
Exchange gains realized
2,982
705
Net unrealized exchange gain - 11,901
Other ınancial income 46 20
Total ınancial revenue 3,033 12,650
Financial expenses
Interest expense on borrowings
1)
(52,895)
(63,554)
Exchange losses realized
(3,161)
(1,153)
Net unrealized exchange loss (1,326) -
Other ınancial expenses
2)
(427) (1,332)
Total ınancial expenses (57,809) (66,039)
Net ınancial items
(54,775)
(53,390)
1) Figure for 2020 includes expensed capitalized loan fees of EUR 7.1 million related to reınancing.
2) Includes interest expense from negative bank accounts in group multicurrency cash pool and negative interest on bank deposits.
Axactor Group90
Note 12 Income tax and tax assets and liability
Income tax calculation
The Group’s tax expense is affected by several factors, where the most important are limitation of interest deduction, unrecognized tax losses
carried forward, currency effects and local GAAP/IFRS-differences for calculation of taxable proıt.
EUR thousand 2021 2020
Ordinary result before taxes
(40,696)
(32,228)
Basis for income tax
(40,696)
(32,228)
Income tax payable calculated 5,411 15,892
Tax effect on permanent difference
(7,859)
(5,886)
Adjustment for previous year
8
(621)
Tax effect on tax rate reduction (1) (154)
Limitation of interest deduction, for which no deferred tax asset was recognized 4,014 (2,637)
Limitation interest deduction, recognized in deferred tax - 1,465
Use of tax losses, previously not recognized - 108
Tax assets, previously not recognized - (216)
Tax losses for which no deferred tax asset was recognized
(1,530)
(16,009)
Tax effect of change in net deferred income tax liabilites/assets
(3,912)
6,462
Effect on foregin exchange rates (1,426) (178)
Income tax expense (5,296) (1,774)
Deferred taxes
EUR thousand 2021 2020
Non-current portfolios (2,887) (4,416)
Non-current intangible assets/liabilities (159) (1,076)
Current assets 158 1,168
Non-current liabilities
(52)
(822)
Limitation interest carried forward
-
1,274
Re-classiıcation deferred taxes relating to group contribution (2,863) (1,261)
Tax losses carried forward 13,359 6,466
Net deferred tax 7,556 1,333
Deferred tax asset
13,700
7,769
Deferred tax liability
(6,144)
(6,436)
Annual report 2021 91
Unrecognized deferred tax assets
A deferred tax asset is recognized only to the extent that it is probable hat future taxable proıts will be available against which the asset can be
utilized. Tax losses carried forward, not recognized, mainly relates to companies in Luxembourg and Italy. Limitation of interest deduction, not
recognized, relates mainly to Norway:
EUR thousand 2021 2020
Tax losses carried forward, not recognized
32,349
21,120
Limitation of interest deduction, not recognized 4,014 3,992
Net assets not recognized 36,363 25,112
Income tax expense per country
EUR thousand 2021 2020
Germany 1,425 1,677
Italy (92) (493)
Finland 300 56
Luxembourg
-
2,053
Norway
(1,391)
(5,107)
Spain (498) 375
Sweden (5,040) (335)
Income tax expense (5,296) (1,774)
Note 13 Earnings per share
Basic earnings per share (EPS) is calculated by diving the proıt attributable to shareholders of the parent company by the weighted average
number of ordinary shares outstanding during the year according to note 25.
Axactor currently has no share-based compensation programs that results in a dilutive effect on earnings per share. See note 26 for an overview
of outstanding instruments in the share option plan.
The following relects the income and share data used in the basic and diluted EPS calculations:
EUR thousand 2021 2020
Net proıt/(loss) attributable to shareholders of the parent company
(32,797)
(18,131)
Number of shares (in thousands)
Weighted average number of ordinary shares 293,408 182,445
Effects on dilution from share options
-
11,544
Weighted average number of shares adjusted for the effect of dilution
293,408
193,989
Basic earnings per share
(0.112)
(0.099)
Diluted earnings per share (0.112) (0.099)
The following instruments could potentially dilute basic earnings per share in the future:
2021 2020
Employee share options
8,548,969
13,775,508
Axactor Group92
Note 14 Intangible assets
EUR thousand Customer relations Databases Software Goodwill
Other
intangibles Total
Cost price
Cost price at 1 Jan 2020 12,700 3,694 23,150 56,170 3,426 99,140
Acquisition - - 4,988 - 491 5,479
Reclassiıcation - - - - - -
Disposals at cost price - - (62) - - (62)
Currency exchange effects (392) (83) - (1,291) (11)
(1,778)
Cost price at 31 Dec 2020
12,308
3,611
28,076
54,879
3,905
102,779
Acquisition - - 3,131 - 412 3,543
Reclassiıcation - - 619 - - 619
Disposals at cost price - - (2,885) - - (2,885)
Currency exchange effects
324
69
15
1,081
10
1,499
Cost price at 31 Dec 2021
12,631
3,680
28,956
55,960
4,328
105,555
Amortization and impairment
Accumulated amortizations at 1 Jan 2020 (9,620) (2,412) (8,070) - (1,381) (21,483)
Amortization of the year (2,371) (649) (3,463) - (318) (6,800)
Reclassiıcation - - - - - -
Disposals accumulated amortizations - - 62 - - 62
Currency exchange effects 272 48 (12) - 2
310
Accumulated amortizations at 31 Dec 2020
(11,718)
(3,013)
(11,483)
-
(1,697)
(27,911)
Amortization of the year (597) (553) (4,188) - (517) (5,854)
Reclassiıcation - - (619) - - (619)
Disposals accumulated amortizations - - 2,863 - 135 2,998
Currency exchange effects
(316)
(59)
(6)
-
(2)
(383)
Accumulated amortizations at 31 Dec 2021
(12,631)
(3,625)
(13,433)
-
(2,081)
(31,769)
Carrying amount at 31 Dec 2021
-
55
15,523
55,960
2,247
73,784
Useful life 3-5 yr 3-6 yr 3-10 yr na 1-10 yr
For impairment testing of goodwill see note 15.
Annual report 2021 93
Note 15 Impairment testing of intangible assets with an indeınite life time
Goodwill and intangible assets stated in the consolidated ınancial
position are mainly derived from excess values following the
acquisitions of ALD Abagados in Spain (2015), IKAS Group in Norway
(2016), CS Union in Italy (2016), Altor Group in Germany (2016),
Profact in Sweden (2017) and SPT Group Finland (2018). Recognized
goodwill amounts to 56.0 EUR million at 31 December 2021 (2020:
EUR 54.9 million). Other intangible assets related to excess values in
the annual accounts are customer relations, databases, and software,
with a carrying amount of EUR 0.1 million at 31 December 2021 (2020:
EUR 1.2 million).
Only goodwill has an indeınite lifetime, all other intangible assets are
amortized, see note 14.
Goodwill is tested for impairment for each cash generating unit (CGU)
prior to preparation of the annual accounts. The test is performed
annually, and when there are indications of impairment.
The recoverable amount for each CGU has been determined
estimating their value in use (VIU) and comparing that to the carrying
amount of the speciıc CGU. The calculation of VIU has been based
on management's best estimate, relecting the Group's ıve-year
strategy plan set up during 2021. The discount rates are derived as the
weighted average cost of capital (WACC) for a similar business in the
same business environment.
Goodwill has been allocated for impairment testing purposes to
the CGU “Third-party collection business” for the following CGU
“Countries”:
EUR thousand 2021 2020
Finland
2,592
2,592
Germany 9,301 9,301
Italy 7,310 7,310
Norway 21,270 20,166
Spain 14,328 14,328
Sweden
1,159
1,181
Total
55,960
54,878
Cash low projections and assumptions
A ıve-year forecast of discounted cash lows plus a terminal value was
used to determine the net present value of the CGU. Discounted cash
lows related to the third-party collection business were calculated
pre-tax and applying a pre-tax WACC. The pre-tax WACC was
derived by back-solving based on the estimated value using the post-
tax WACC and the post-tax cash low.
The terminal value is based on the estimated pre-tax net cash low in
2026, using a standard perpetuity formula with a long-term growth
rate of 1.5% (2020: 1.5%).
Key assumptions for the value in use calculations
The calculation of VIU for the CGU is most of all sensitive when it
comes to the following assumptions:
Discount rate
The input data for the WACC is gathered from representative sources,
peer groups etc., and this is used to determine the best estimate. The
WACC was calculated after tax, and then back solved to arrive at a
pre-tax WACC. All parameters were set to relect the long-term period
of the assets and time horizon of the forecast period of the cash lows.
Key inputs for the WACC for the CGU:
EUR thousand EUR NOK SEK
Beta
0.76
0.76
0.73
Risk-free interest (0.48%) 1.63% 0.07%
Market risk premium 4.24% 4.72% 4.72%
Small cap premium
6.00%
6.00%
6.00%
Cost of equity 8.80% 11.20% 9.54%
Equity ratio 30.15% 30.15% 30.15%
Cost of debt 5.90% 5.90% 5.90%
WACC 5.83% 6.47% 6.11%
x Risk free rate: 5-year risk free bond per country
x Beta (equity): Unlevered beta based on observed monthly levered
beta for Axactor for the last ıve years
x Market risk premium: The market risk premium is based on
empirical data for risk premium (Damodaran)
x Company speciıc/small cap premium: The company speciıc
premium is based on Ibbotson analysis
x Capital structure: Applied 30% equity ratio based on company
estimates for 2022
x Cost of debt: Applied cost of debt of 5.9% based on company
estimated forecasts
Growth rate
The growth rate in the forecast period is based on management's
expectation for the development in the different markets, and
management's strategic plan. The terminal growth rate at 1.5% applied
in 2020 remains at 1.5% in 2021.
Cash low
The calculation includes cash lows for ıve years, in addition to
terminal value. Cash low estimates are based on a weighted average
of a ıve-year ınancial plan reviewed by the Board of Directors and a
base case with more conservative assumptions.
Axactor Group94
The cash low shows expectation of gross proıt improvement and
revenue growth handled by the existing organization.
Impairment – test results and conclusion
The VIU exceeds carrying amount for each of the CGUs. The impair-
ment test did not indicate that the value of the goodwill needs to be
impaired. Based on a sensitivity analysis, the ceteris paribus impact of
reducing the terminal growth rate from 1.5% to 0.5% would not result
in any impairment of goodwill. Similarly, the ceteris paribus impact of
increasing the WACC by one percentage point would not result in any
impairment of goodwill. Management has considered and assessed
reasonable possible changes for key assumptions and has not identiıed
any instance that could cause the carrying amount of the goodwill to
exceed its recoverable amount.
Note 16 Tangible assets
EUR thousand Fixtures Vehicles Ofıce equipment Total
Cost price
Cost price at 1 Jan 2020 4,373 82 3,326 7,781
Acquisition 201 - 434 635
Reclassiıcation 5 - (4) 1
Disposals at cost price (8) - (129) (137)
Currency exchange effects 10 (2) (27)
(19)
Cost price at 31 Dec 2020
4,581
80
3,600
8,260
Acquisition 472 - 591 1,063
Reclassiıcation 1 - (1) -
Disposals at cost price (2,233) (80) (852) (3,165)
Currency exchange effects
(7)
-
27
21
Cost price at 31 Dec 2021
2,814
-
3,366
6,180
Depreciation and impairment
Accumulated depreciations at 1 Jan 2020 (2,767) (49) (2,060) (4,877)
Depreciation of the year (337) (8) (645) (990)
Reclassiıcation (3) - 2 (1)
Disposals accumulated depreciations 3 - 118 122
Currency exchange effects (4) 2 17
16
Accumulated depreciations at 31 Dec 2020
(3,107)
(55)
(2,568)
(5,730)
Depreciation of the year (338) (7) (515) (860)
Reclassiıcation - - (1) (1)
Disposals accumulated depreciations 1,916 62 747 2,725
Currency exchange effects
2
-
(25)
(23)
Accumulated depreciations at 31 Dec 2021
(1,527)
-
(2,363)
(3,889)
Carrying amount at 31 Dec 2021
1,288
-
1,003
2,290
Useful life 3-6 yr 5 yr 3-5 yr
Annual report 2021 95
Note 17 Financial instruments
The Group’s ınancial assets consist of purchased debt portfolios, derivatives, trade and other receivables, cash and cash equivalents, in addition
to an immaterial equity investment. The majority of the Group’s ınancial assets are classiıed as measured at amortized cost, with the exception
of derivatives which are classiıed as measured at fair value through proıt or loss and the equity investment which is classiıed as measured at fair
value through other comprehensive income (FVOCI). The Group’s debt and other ınancial liabilities are, with the exception of derivatives, initially
recognized at fair value, including transaction costs directly attributable to the transaction, and are subsequently measured at amortized cost.
Derivative liabilities are, as derivative assets, measured at fair value through proıt or loss.
The Group uses the following hierarchy for determining and disclosing the fair value of ınancial instruments by the inputs used in the valuation
techniques:
Level 1: Quoted prices in active markets for identical assets or liabilities
Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly
Level 3: Inputs for the asset or liability that are not based on observable market data (unobservable input)
The level in this fair value hierarchy within which the measurements are categorized is determined based on the lowest level input that is
signiıcant to the fair value measurement.
The following table shows the carrying amounts and fair values of ınancial assets and ınancial liabilities, including their levels in the fair value
hierarchy. It does not include fair value information for ınancial assets and ınancial liabilities not measured at fair value if the carrying amount is
a reasonable approximation of fair value. For other non-current investments, only the amount related to the equity investment measured at fair
value through OCI is included in the table.
Financial instruments
Carrying amount Fair value
EUR thousand
Loans and
receivables
Other ınancial
assets and
derivatives Total Level 1 Level 2 Level 3 Total
31 Dec 2021
Financial assets
NPL portfolios 1,095,789 - 1,095,789 - - 1,238,070 1,238,070
Forward low derivatives, asset - - - - - - -
Investment measured at FVOCI
-
5
5
-
-
5
5
Total
1,095,789
5
1,095,794
-
-
1,238,075
1,238,075
Financial liabilities
Interest bearing debt 838,256 - 838,256 503,320 351,998 - 855,318
Forward low derivatives, liability - 409 409 - - 409 409
Cash low hedge derivatives
-
230
230
-
230
-
230
Total
838,256
639
838,894
503,320
352,228
409
855,957
31 Dec 2020
Financial assets
NPL portfolios 1,124,699 - 1,124,699 - - 1,247,501 1,247,501
Forward low derivatives, asset - 257 257 - - 257 257
Investment measured at FVOCI
-
20
20
-
-
20
20
Total
1,124,699
277
1,124,976
-
-
1,247,778
1,247,778
Financial liabilities
Interest bearing debt 936,185 - 936,185 204,000 736,185 - 940,185
Forward low derivatives, liability - 1,091 1,091 - - 1,091 1,091
Total
936,185
1,091
937,276
204,000
736,185
1,091
941,276
The fair value of the bond loans was determined using the quoted market values for the bond loans from the Norwegian Verdiforetakenes
Forbund. The fair value of the other interest-bearing loans at 31 December 2021 is equal to the nominal value and accrued interest.
Axactor Group96
Forward low derivatives, balance movements
EUR thousand 2021 2020
Balance at 1 Jan (834) -
Deliveries of forward low contracts 1,221 (882)
Value change
(796)
48
Balance at 31 Dec
(409)
(834)
Note 18 Purchased debt portfolios
EUR thousand 2021 2020
Balance at 1 Jan 1,124,699 1,041,919
Acquisitions during the year
3)
113,979 208,250
Collection (254,949) (236,459)
Yield - Interest revenue from purchased loan portfolios
168,421
163,093
Net gain/(loss) purchased loan portfolios
1)
(62,013)
(49,813)
Repossession of secured NPL to REO (845) (2,279)
Deliveries of forward low contracts (1,221) -
Disposals
1)
(193) (403)
Translation difference 7,911 392
Balance at 31 Dec
1,095,789
1,124,699
Payments during the year for investments in purchased debt amounted to EUR
2)
115,402
213,032
1) Gain on disposals is netted in proıt or loss as 'Net gain/(loss) purchased loan portfolios'
2) Payments during the year will not correspond to credit impaired acqusitions during the year due to deferred payments
3) Reconciliation of credit impaired acquisitions during the year;
Nominal value acquired portfolios 827,810 424,062
Expected credit losses at acquisition (713,831) (215,812)
Credit impaired acquisitions during the year 113,979 208,250
For a description of Axactor's accounting principles for purchased debt, see note 2 and for a description of revenue recognition and fair value
estimation, see note 4.
Non-performing loans consist of portfolios of delinquent consumer debts purchased signiıcantly below nominal value, relecting incurred
and expected credit losses, and thus deıned as credit impaired. NPLs are recognized at fair value at the date of purchase. Since the loans are
measured at fair value, which includes an estimate of future credit losses, no allowance for credit losses is recorded in the consolidated statement
of ınancial position on the day of acquisition of the loans. The loans are subsequently measured at amortized cost applying the credit adjusted
effective interest rate method.
Since the delinquent consumer debt is a homogenous group, the future cash lows are projected on a portfolio basis.
The carrying amount of each portfolio is determined by projecting future cash lows discounted to present value using the credit adjusted
effective interest rate as at the date the portfolio was acquired. The total cash lows (both principal and interest) expected to be collected on
purchased credit impaired loans are regularly reviewed and updated in line with expectation on an array of economic factors and conditions over
time. Changes in value resulting from changes in expected cash low are adjusted in the carrying amount and are recognized in proıt or loss as
income or expense in ‘Net gain/(loss) purchased loan portfolios’. Interest income is recognized using the credit adjusted effective interest rate,
included in ‘Interest revenue from purchased loan portfolios’.
The majority of the non-performing loans are unsecured. Only an immaterial part of the loans, approximately 3% of the book value of the loans,
is secured by a property object.
Annual report 2021 97
EUR thousand
Market
Book value
2021 2020
Finland
111,841
118,225
Germany 131,059 126,689
Norway 249,439 230,338
Sweden 228,068 267,432
Italy 111,348 122,832
Spain
264,034
259,183
Total 1,095,789 1,124,699
The estimation of future cash low is affected by several factors, including general macro factors, market speciıc factors, portfolio speciıc factors
and internal factors. Axactor considers relevant macro factors and market speciıc factors when estimating future cash low but not as direct input
generating output in the forecast models. Portfolio speciıc factors and internal factors are considered to affect the estimation of future cash low
signiıcantly more than changes in general macro factors and market speciıc factors.
Axactor has incorporated into the estimated remaining collection (ERC) the effect of the economic factors and conditions that is expected to
inluence collections going forward. An analysis of the effects of historical crises like the ınancial crisis in 2008 and the experience on collections
during the Covid-19 pandemic over the last years has formed the basis for the current ERC.
The ERC represents the estimated gross collection on the NPL portfolios. The yield represents the interest revenue from purchased loan portfo-
lios and can be reconciled as the ERC less amortization. The ERC, amortization and yield can be broken down per year as follows (year 1 means
the ırst 12 months from the reporting date):
ERC at 31 December 2021:
EUR thousand Estimated remaining collection (ERC), amortization and yield per year
Year 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 Total ERC
ERC 268,832 261,948 225,843 200,819 177,633 160,087 141,774 127,467 114,766 103,142 93,135 84,078 72,064 58,344 50,611 2,140,543
Amortization 107,788 118,694 101,236 91,330 81,907 76,761 69,424 65,132 61,836 59,169 57,780 57,213 53,505 47,268 46,746 1,095,789
Yield 161,045 143,254 124,607 109,489 95,726 83,326 72,350 62,335 52,930 43,973 35,354 26,865 18,559 11,075 3,864 1,044,754
ERC at 31 December 2020:
EUR thousand Estimated remaining collection (ERC), amortization and yield per year
Year 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 Total ERC
ERC 283,369 253,413 222,474 198,545 178,731 160,049 142,649 128,421 116,276 105,617 95,752 87,016 79,133 65,609 52,099 2,169,153
Amortization 125,840 114,880 99,902 90,097 83,014 76,036 69,272 64,823 61,897 60,088 58,845 58,587 59,228 54,092 48,097 1,124,699
Yield 157,529 138,533 122,573 108,447 95,717 84,013 73,377 63,598 54,379 45,529 36,907 28,428 19,905 11,517 4,003 1,044,454
Axactor Group98
Note 19 Hedge accounting
The Group´s risk management objective is to mitigate the effect of interest rate changes related to its loating rate instruments. In order to
achieve the objective, the Group´s strategy is to use derivatives to limit the impact of changes in interest rates on the Group´s interest expenses.
The Group applies cash low hedge accounting to ensure that the Group´s risk management strategy is relected in its ınancial statements.
Cash low hedges
Interest rate risk in loating rate instruments
The Group´s risk management objective and strategy is to apply cash low hedge accounting for interest rate risk in order to mitigate the effect
of increasing EURIBOR rates on issued bonds and therefore limit the impact on the Group´s interest expenses. The hedged items consist of a
proportion of issued loating-rate bonds. The hedged risk is deıned as interest rate risk for EURIBOR interest rates. The hedging instruments
consist of interest rate caps. The hedge ratio for the relationships is deıned by the ratio of the principal of the interest rate cap to the designated
proportion of the hedged item, resulting in 100% hedge ratio. Potential sources of ineffectiveness have been identiıed as differences in timing of
cash lows of hedged items and hedging instruments, derivatives used as hedging instruments having a non-nil fair value at the time of designation
and the effect of changes in counterparties’ credit risk on the fair values of hedging instruments or hedged items.
The Group started with hedge accounting at the end of 2021. All comparable ıgures for 2020 for the tables presented below are hence 0 and
not presented as separate tables. The Group’s strategy is to hedge between 50% and 70% of interest bearing debt with a duration of three to
ıve years.
The ınancial instruments designated as hedged items in current cash low hedge relationships are:
Hedged items - cash low hedges
Other reserves
EUR thousand Nominal amount
Nominal amount
designated for
hedge accounting
Changes in
fair value used
to calculate
ineffectiveness Continuing hedges
Discontinued
hedges
31 Dec 2021
Interest rate risk
Floating rate issued bonds
200,000
200,000
-
(230)
-
Total
200,000
200,000
-
(230)
-
The hedged items are included as part of interest bearing debt in the consolidated statement of ınancial position.
Annual report 2021 99
The table below sets out the derivatives designated as hedging instruments in current cash low hedge relationships, and the outcome of the
Group´s hedging strategy:
Hedging instruments - cash low hedges
EUR thousand Up to 1 year 1-5 years Over 5 years Total
31 Dec 2021
Interest rate caps
Nominal amount 2,778 197,222 - 200,000
Average strike 0.5% 0.5% - 0.5%
Carrying amount
EUR thousand
Nominal
amount Assets Liabilities
Changes in
fair value used
to calculate
ineffectiveness
Changes
in value
recognised
in OCI
Ineffectiveness
recognised in
proıt or loss
Amount
reclassiıed from
other reserves
to proıt or loss
31 Dec 2021
Interest rate risk
Interest rate caps
200,000
-
230
-
(230)
-
-
Total
200,000
-
230
-
(230)
-
-
The hedging instruments are included as part of other non-current liabilities in the consolidated statement of ınancial position. The effective
portion of the gain or loss on the hedging instrument is, if applicable, included as part of ınancial expenses. Hedge ineffectiveness is, if applicable,
recorded as part of ınancial expenses or ınancial revenue. Amounts reclassiıed from the cash low hedge reserve into proıt or loss are, if
applicable, recorded as part of ınancial expenses.
Axactor Group100
Note 20 Shares in subsidiaries
Subsidiary company
EUR thousand Share of ownership
Share of
voting rights
Ofıce
location,
city
Ofıce
location,
country
Result
2021
Equity
2021
Axactor Italy Holding Srl 100.0% 100.0% Cuneo Italy (571) 86,238
Axactor Italy SpA 100.0% 100.0% Cuneo Italy 853 64,014
Axactor Capital Italy Srl
4)
100.0% 100.0% Cuneo Italy (2,263) (325)
Axactor Portfolio Holding AB
100.0%
100.0%
Gothenburg
Sweden
(27,902)
339,399
Axactor Platform Holding AB 100.0% 100.0% Gothenburg Sweden (1,241) 132,674
Axactor Sweden AB 100.0% 100.0% Gothenburg Sweden (16,583) 12,213
Axactor Norway Holding AS 100.0% 100.0% Oslo Norway 3,319 31,016
Axactor Capital AS 100.0% 100.0% Drammen Norway 11,363 134,705
Axactor Norway AS
100.0%
100.0%
Drammen
Norway
(1,152)
581
ReoLux Holding Sarl
1)
50.0%
50.0%
Luxembourg
Luxembourg
(15,894)
(7,383)
Axactor Invest 1 Sarl 100.0% 50.0% Luxembourg Luxembourg 11,342 19,465
Axactor Capital Luxembourg Sarl 100.0% 100.0% Luxembourg Luxembourg 13,594 109,242
Beta Properties SLU
2)
100.0% 100.0% Madrid Spain (1,218) 2,224
Borneo Commercial Investments SLU
2)
100.0% 100.0% Madrid Spain (550) 635
Alcala Lands Investments SLU
2)
100.0% 100.0% Madrid Spain (615) 178
PropCo Malagueta SL
3)
75.0% 75.0% Malaga Spain (8,180) 13,131
Proyector Lima SL
3)
75.0%
75.0%
Madrid
Spain
(7,360)
9,059
Axactor Espana SLU 100.0% 100.0% Madrid Spain 1,671 30,776
Axactor Espana Platform SA 100.0% 100.0% Madrid Spain (3,520) 1,140
Axactor Germany Holding GmbH 100.0% 100.0% Heidelberg Germany (327) 12,609
Axactor Germany GmbH 100.0% 100.0% Heidelberg Germany (5,904) (18,030)
Heidelberger Forderingskauf GmbH
100.0%
100.0%
Heidelberg
Germany
4,246
22,644
Heidelberger Forderungskaurf II GmbH
100.0%
100.0%
Heidelberg
Germany
(971)
(2,169)
Axactor Finland OY 100.0% 100.0% Jyväskylä Finland (3,076) 5,955
SPT Latvija SIA
4)
100.0% 100.0% Riga Latvia (17) (3)
SPT Inkasso OÜ
4)
100.0% 100.0% Tallin Estonia (54) 9
1) The parent company owns 50% of the shares of Reolux Holding. Based on the contractual arrangements between the Group and the other investor, the Group has concluded
that it has control of Reolux Holding and the company is therefore consolidated in the Group's ınancial statements.
2) The company is owned 100% by Reolux Holding Sarl, in which Axactor owns 50% of the shares and has control.
3) The company is owned 75% by Reolux Holding Sarl, in which Axactor owns 50% of the shares and has control.
4) Dormant, to be liquidated
The ınancial ıgures of the subsidiaries have been included in the consolidated ınancial statements of Axactor Group from the date of acquisition.
During 2021, several small entities have been liquidated or merged into other Axactor entities to simplify the legal structure within the Group.
Annual report 2021 101
Note 21 Other non-current investments
Other non-current investments
EUR thousand 2021 2020
Club Financiero Génova, S.A 11 21
Insurance funds (severence scheme in Italy) - 142
Investment measured at FVOCI
4
20
Other investments
13
13
Total other non-current investments
28
196
Note 22 Stock of secured assets, REOs
EUR thousand 2021 2020
Acquisition cost, balance at 1 Jan 78,786 129,040
Acquisitions during the year
1)
193 399
Repossession of secured NPL
845
2,279
Cost of sold secured assets
(44,601)
(36,818)
Aquisition cost, balance at 31 Dec
35,225
94,901
Impairment (5,915) (16,114)
Balance at 31 Dec 29,310 78,786
Number of assets
1,446
2,694
1) Acquisitions include expenses for registry, inscription and upgrades to existing assets in inventory. No new REOs are acquired.
REO assets are held for sale and therefore considered as stock of secured assets in accordance with IAS 2 Inventories, valued at the lower of cost
price and net realizable value. All REO assets are located in Spain and owned by Spanish entities.
The challenging pricing conditions have continued to affect the projected estimates for this business. Based on external valuations an impairment
amounting to EUR 5.9 million was recognized in 2021 (2020: EUR 16.1 million).
The REO segment is considered to be a discontinued segment from 2022 and will be presented as discontinued operation from 1 January 2022.
Axactor Group102
Note 23 Accounts receivable and other current assets
Accounts receivable
EUR thousand 2021 2020
Accounts receivable
7 060
7 124
Due to the nature of the business the amount of outstanding accounts receivable is low and shows an acceptable aging. Allowances for doubtful
debts are recognized against account receivables on an individual basis, set per country. The allowance amount recognized is not material.
Other current assets
EUR thousand 2021 2020
Prepaid taxes
3,019
2,132
Prepaid expenses 4,609 2,791
Accrued revenues
1)
2,754 2,989
Forward low derivatives, asset - 257
Other
5,772
3,477
Total other current assets
16,154
11,645
1) Accrued revenue relates to 3PC business
A forward low agreement is an obligation to acquire a portfolio of cases described in a contract. Typically, these agreements are to buy defaulted
cases from the vendor on a monthly basis. The total volume under the contract can be capped. The price for the cases in the forward low is
agreed upfront when the contract is signed. Initially the value of the derivative is nil, as the future expected collection level is unchanged from the
valuation assumption underlying the contract. If the future cash low estimates for the forward low changes from the assumed level when signing
the contract, there can be a change in the value of the derivative. Forward low derivative liabilities are shown in note 30.
Annual report 2021 103
Note 24 Cash and cash equivalents
For the purpose of the consolidated statement of cash lows, cash and bank deposits include cash on hand and in banks. Cash and cash equivalent
at the end of the reporting period as shown in the cash low statement can be reconciled to the related items in the consolidated statement of
the ınancials position as follows:
EUR thousand 2021 2020
Cash and bank deposits
38,155
47,779
Restricted cash - client funds
1)
5,090 1,177
Restricted cash and bank deposits - other 708 1,769
Total cash and cash equivalents 43,953 50,725
1) The corresponding client funds payable is reported as part of other current liabilities in note 30.
Restricted cash at the end of the reporting period relates to client funds, deposits for building rent guarantee and employee withholding taxes.
There has been a classiıcation error between restricted and unrestricted cash in the fourth quarter 2021 Interim report due to an erroneous setup
in the reporting in one of the subsidiaries. The classiıcation error amounted to EUR 3.4 million and has been corrected in the Annual Report.
Total cash and cash equivalents remains unchanged.
The composition of the cash per currency is shown below:
EUR thousand 2021 2020
NOK
17,583
10,510
SEK 548 (6,808)
EUR 25,816 47,012
GBP 6 10
Total cash and cash equivalents
43,953
50,725
Cash in bank earns interest at loating rates based on daily bank deposit rates.
Note 25 Issued shares and share capital
Issued shares and share capital
Number of shares Share capital (EUR)
At 31 Dec 2019 155,395,464 81,337,590
New share issues, Feb 30,000,000 15,702,696
At 31 Dec 2020 185,395,464 97,040,286
New share issues, Jan
50,000,000
26,171,159
New share issues, Jan
40,000,000
20,936,928
New share issues, Mar 26,750,000 14,001,570
At 31 Dec 2021 302,145,464 158,149,942
Each share has the same rights and has a par value of EUR 0.523 (rounded). All issued shares are fully paid.
Axactor Group104
20 largest shareholders at 31 Dec 2021
Name Shareholding Share %
Geveran Trading Co Ltd 138 920 892 46.0 %
Torstein Ingvald Tvenge 10 000 000 3.3 %
Ferd AS
7 864 139
2.6 %
Verdipapirfondet Nordea Norge Verdi
4 454 162
1.5 %
Skandinaviska Enskilda Banken AB 3 079 467 1.0 %
Nordnet Livsforsikring AS 2 247 811 0.7 %
Endre Rangnes 2 017 000 0.7 %
Gvepseborg AS 2 009 694 0.7 %
Stavern Helse Og Forvaltning AS 2 000 000 0.7 %
Alpette AS 1 661 643 0.5 %
Verdipapirfondet Nordea Avkastning
1 643 423
0.5 %
Velde Holding AS 1 400 000 0.5 %
Verdipapirfondet Nordea Kapital 1 343 933 0.4 %
Klotind AS 1 296 693 0.4 %
Andres Lopez Sanchez 1 177 525 0.4 %
David Martin Ibeas
1 177 525
0.4 %
Svein Dugstad
1 154 187
0.4 %
Nordea Bank Abp 1 116 576 0.4 %
Nordnet Bank AB 1 086 987 0.4 %
Latino Invest AS 1 040 000 0.3 %
Total 20 largest shareholders 186 691 657 61.8 %
Other shareholders
115 453 807
38.2 %
Total number of shares 302 145 464 100 %
Total number of shareholders
11 128
Shares owned by related parties
Name Shareholding Share %
Latino Invest AS
1)
1 040 000 0.3 %
Johnny Tsolis Vasili
1)
670 000 0.2 %
Terje Mjøs Holding AS
3)
400 000 0.1 %
Robin Knowles
2)
183 714 0.1 %
Kyrre Svae
2)
150 000
0.0 %
Vibeke Ly
2)
133 750 0.0 %
Arnt Andre Dullum
2)
110 000 0.0 %
Nina Mortensen
2)
95 000 0.0 %
Hans Olov Harén
3)
22 150 0.0 %
Brita Eilertsen
3)
19 892
0.0 %
1) CEO/Related to the CEO of Axactor
2) Member of the Executive Management Team of Axactor
3) Member of the Board of Directors of Axactor / controlled by member of the Board of Directors of Axactor
Annual report 2021 105
Note 26 Share-based payment
To incentivise and retain key employees, the Group operates an equity-settled option plan, where one stock option may convert into one
ordinary share in Axactor SE. The options carry neither rights to dividends nor voting rights before exercised into ordinary shares. In general,
participants resigning loses their options when leaving the Company.
The Group uses the Black-Scholes-Merton option pricing model at time of grant to determine the impact of stock option grants in
accordance with IFRS 2 Share-based payment.
The model utilizes the following parameters as input; the Company's share price, the strike price of the options, the expected lifetime of the
options, the risk-free interest rate equalling the expected lifetime and the volatility associated with the historical price development of the
underlying share.
The total fair value of the options is amortized over the vesting period.
Social security provisions are accrued on a quarterly basis and become payable at exercise of the options. The social security provisions are
estimated based on the gain on the options multiplied with the relevant social security rate.
The total expense recognized for the share-based programs during 2021 was EUR 0.2 million (2020: EUR 0.6 million). Total social security
provisions amounts to EUR 0 at 31 December 2021 and 2020 (social security costs on exercised options have been paid in connection with
the relevant exercises, hence taken out of the provisions accounts). The total intrinsic value of the employee stock options was EUR 0 at 31
December 2021 (2020: EUR 0) as the lowest strike value is higher than the share price at period end.
For 2021, the Company's granted share-based payment arrangements are quantitatively described with their weighted average parameters to the
Black-Scholes-Merton option pricing model.
Granted instruments 2021
Parameters connected to instruments granted in 2021
Instrument
Quantity
31.12.2021
(instruments)
Quantity
31.12.2021
(shares)
Contractual
life
1)
Strike
price
1)
(NOK)
Share
price
1)
(NOK)
Expected
lifetime
1)
Volatility
1)
Interest
rate
1)
FV per
instrument
1)
Vesting
conditions Vesting structure Strike structure
Options 500,000 500,000 3.90 24.10 9.30 2.40 50.00% 0.74% 0.67 Service
conditions
only
The awards are vesting
annually over two years
with the ırst vesting
approximately one
year from grant date
20% of the total award
has a strike price of
17,50 NOK
30% of the total award
has a strike price of
22,00 NOK
50% of the total award
has a strike price of
28,00 NOK
1) Weighted average parameters at grant of instrument
As the employee options are "non-transferable", and the options' gains are taxed with personal income tax (higher), whereas gains on ordinary
shares are taxed with capital gains tax (lower), it is reasonable to assume that participants tend to exercise early. Hence estimated lifetime of the
options is expected to be shorter than the time from grant until expiry. However, exercise patterns are monitored frequently and expected option
lifetime for future grants will relect exercise behaviour.
At year end the Group has options outstanding that were granted from 2017 to 2021 and the exercise prices vary from NOK 17.5 to NOK 37.5 per
option.
Axactor Group106
The table below illustrates the status on all outstanding options at 31 December 2021 and the activity during the year.
Share option plan
2021
Activity Number of options
Weighted
average strike
price (NOK)
Outstanding at beginning of year
13,775,508
24.98
Granted
500,000
24.10
Forfeited (4,101,481) 26.54
Expired (1,625,058) 12.74
Outstanding at end of year 8,548,969 26.50
Vested CB 4,531,169 28.05
Outstanding instruments overview
Outstanding instruments Vested instruments
Strike price (NOK)
Number of
instruments
Weighted
average remaining
contractual life
Weighted
average strike
price (NOK)
Vested
instruments
31.12.2021
Weighted
average strike
price (NOK)
17.5 0
950,000
3.50
17.50
283,333
17.50
22.00
1,425,000
3.50
22.00
425,000
22.00
24.50 723,189 2.32 24.50 723,189 24.50
26.50 723,189 2.32 26.50 723,189 26.50
28.00 3,059,466 3.23 28.00 708,333 28.00
30.00 419,375 0.54 30.00 419,375 30.00
32.00 419,375 0.54 32.00 419,375 32.00
35.00 419,375 0.54 35.00 419,375 35.00
37.50
410,000
0.54
37.50
410,000
37.50
Total 8,548,969 4,531,169
Annual report 2021 107
Note 27 Borrowings and other interest-bearing debt
EUR thousand Currency Facility limit Nominal value
Capitalized
loan fees
Accrued
interest
Carrying
amount, EUR Interest coupon Maturity
Facility
Bond (ISIN: NO0010914666) EUR 200,000 (4,778) 3,033 198,255 3m EURIBOR+700pbs 12.01.2024
Bond (ISIN: NO0011093718) EUR 300,000 (3,853) 791 296,938 3m EURIBOR+535bps 15.09.2026
Total bond loan - 500,000 (8,631) 3,824 495,193
Revolving credit facility DNB/Nordea EUR 545,000 17,368 (8,936) 21 8,453 EURIBORmargin 22.12.2023
(multiple currency facility)
NOK
114,267
114,267
NIBORmargin
22.12.2023
SEK 220,343 220,343 STIBORmargin 22.12.2023
Total credit facilities 545,000 351,977 (8,936) 21 343,063
Total borrowings at 31 Dec
545,000
851,977
(17,566)
3,845
838,256
whereof:
Non-current borrowings 834,411
Current borrowings 3,845
of which in currency:
NOK 114,267
SEK 220,343
EUR
503,646
EUR thousand Bond loan Credit facilities Other borrowings
Total
borrowings
Total borrowings at 31 Dec 2019 199,069 495,318 235,546 929,933
Proceeds from loans and borrowings
-
73,302
8,329
81,631
Repayment of loans and borrowings - (43,251) (41,144) (84,395)
Loan fees - (4,503) - (4,503)
Total changes in ınancial cash low - 25,548 (32,815) (7,267)
Change in accrued interest - (2) 94 92
Amortization capitalized loan fees
1)
1,214 11,521 2,799
15,534
Currency translation differences
-
(2,106)
-
(2,106)
Total borrowings at 31 Dec 2020
200,283
530,278
205,625
936,185
Proceeds from loans and borrowings 311,050 231,446 - 542,496
Repayment of loans and borrowings (11,050) (411,175) (206,456) (628,681)
Loan fees
(10,948)
(13,087)
2
(24,033)
Total changes in ınancial cash low
289,052
(192,816)
(206,454)
(110,218)
Change in accrued interest 3,513 (45) (334) 3,134
Amortization capitalized loan fees 2,345 4,239 1,165 7,749
Currency translation differences - 1,406 - 1,406
Total borrowings at 31 Dec 2021 495,193 343,063 -
838,256
1) Includes expensed capitalized loan fees of EUR 7.1 million related to the reınancing
Axactor Group108
Maturity
EUR thousand Currency
Carrying
amount
Total future
cash low
Estimated future cash low within
6 months
or less 6-12 months 1-2 years 2-5 years
ISIN NO 0010819725
EUR
198,255
231,967
7,078
7,117
14,194
203,578
ISIN NO 0011093718 EUR 296,938 377,352 8,114 8,159 16,273 344,806
Total bond loan 495,193 609,319 15,192 15,276 30,467 548,384
Revolving credit facility DNB/Nordea
(multiple currency facility)
NOKSEKEUR
343,063
374,152
5,544
5,544
363,064
-
Total credit facilities
343,063
374,152
5,544
5,544
363,064
-
Total borrowings at 31 Dec
838,256
983,472
20,736
20,820
393,531
548,384
The maturity calculation is made under the assumption that no new portfolios are acquired and the revolving credit facility draw is constant to
maturity date.
Bond loan
Bond (ISIN NO 0010914666) ACR02 was placed at 3m EURIBOR +7.00% interest, with maturity date 12 January 2024.
The bond is listed on Oslo Børs.
The following ınancial covenants apply:
x Interest coverage ratio: >4.0x (Pro-forma adjusted Cash EBITDA to net interest expenses)
x Leverage ratio: <4.0x (NIBD to pro-forma adjusted cash EBITDA).
x Net loan to value: <75% (NIBD to total book value all debt portfolios and REOs)
x Net secured loan to value: <65% (secured loans less cash to total book value all debt portfolios and REOs).
Trustee: Nordic Trustee
Bond (ISIN NO 0011093718) ACR03 was placed at 3m EURIBOR +5.35% interest, with maturity date 15 September 2026.
The bond is listed on Oslo Børs.
The following ınancial covenants apply:
x Interest coverage ratio: >4.0x (Pro-forma adjusted Cash EBITDA to net interest expenses)
x Leverage ratio: <4.0x (NIBD to pro-forma adjusted cash EBITDA).
x Net loan to value: <80% (NIBD to total book value all debt portfolios and REOs)
x Net secured loan to value: <65% (secured loans less cash to total book value all debt portfolios and REOs).
Trustee: Nordic Trustee
Revolving credit facility DNB/Nordea
The revolving credit facility consists of EUR 545 million in a multicurrency facility, with an addition of 75 million in the form of accordion option.
The loan carries a variable interest rate based on the interbank rate in each currency with a margin.
The following ınancial covenants apply:
x NIBD ratio to pro-forma adjusted cash EBITDA < 3:1 (secured loans (RCF) less cash to pro-forma adjusted cash EBITDA L12M)
x Portfolio loan to value ratio < 60 % (NIBD to total book value of debt portfolios)
x Portfolio collection performance > 90 % (actual portfolio performance L6M to active forecast L6M)
x Parent loan to value < 80 % (total loans for the Group less cash to total book value of all debt portfolios and REOs)
The maturity date for the facility is 22 December 2023.
Annual report 2021 109
All material subsidiaries of the Group are guarantors and have granted a share pledge and bank account pledge as part of the security package for
this facility. ReoLux Holding Sarl is not part of the agreement nor the security arrangement.
Italian banks
In the fourth quarter of 2021, local Italian facilities have been repaid in full by drawing on the RCF and Italian subsidiaries have been incorporated in
the loan agreement and security arrangement with DNB and Nordea.
Note 28 Pension liabilities
Axactor meets the different local mandatory occupational pension requirements in the countries where Axactor operates.
Axactor operates deıned contribution retirement beneıt plans for all qualifying employees of its subsidiaries in Sweden and Norway. The Group’s
legal obligation for these plans is limited to the contributions.
The employees of the Finnish, Spanish and German subsidiaries are member of a state managed retirement beneıt plan operated by the
government of respectively Finland, Spain, and Germany. The subsidiaries are required to contribute a speciıed percentage of payroll costs to the
retirement beneıt scheme to fund the beneıts. The Group’s legal obligation for these plans is limited to the contributions.
In Italy all employees are entitled to a termination indemnity (TFR) upon termination of employment for any reason. This TFR is considered a
deıned beneıt obligation to be accounted for in accordance with IAS 19. Axactor funds deıned beneıt plans for the qualifying employees.
Pension liabilities are recognized in the consolidated statement of ınancial position as other non-current liabilities (note 29).
The total pension expenses recognized in the consolidated statement of proıt or loss amount to EUR 1.5 million (2020: EUR 1.3 million) and
represent contributions payable to these plans by Axactor at rates speciıed in the rules of the plans.
Note 29 Other non-current liabilities
EUR thousand 2021 2020
Other non-current accruals 471 222
Cash low hedge derivatives (note 19) 230 -
Pension liability (note 28)
1,293
1,210
Total other non-current liabilities
1,994
1,433
Axactor Group110
Note 30 Other current liabilities
EUR thousand 2021 2020
Public duties
3,943
3,983
Personnel related liabilities
6,452
3,828
Accrued solicitors 544 492
Deferred payments relating to NPL 8,863 5,504
Forward low derivatives, liability
2)
409 1,091
Accrued restructuring cost 1,039 439
Client funds payable
1)
5,090
1,177
Other accruals 600 4,143
Total other current liabilities 26,941 20,657
1) The corresponding client funds cash balance is reported as part of cash in note 24
2) For a description of forward low derivatives, see note 23.
Note 31 Transactions with related parties
EUR thousand 2021 2020
Related party balances as per year end
Geveran Trading Co LTD owned 50% of Axactor Invest 1, a company controlled and consolidated by Axactor
Group, has by one of its subsidiaries subscribed to deeply subordinated income sharing notes issued by
Axactor Invest 1. The loan was fully repaid in Q1 2021. - 140,000
Following the co-investment partnership with Geveran, notes in the amount of EUR 230 million have been
issued, of which for EUR 185 million has been subscribed to by Sterna Finance, a company in the Geveran
Group. The loan was fully repaid in Q1 2021. - 185,000
Related party transactions during the year
On 17 February 2020, the Company entered into a servicing agreement with Seatankers Management Co.
Ltd., a company controlled by Geveran, under which Seatankers Management Co. Ltd. has agreed to provide
the Company with advisory and other support services upon request. The agreement is entered on an
arm-length basis and is not considered material. 7 114
On 5 January 2021 Axactor aquired the remaining 50% of the shares in Axactor Invest 1 Sarl from Geveran
Trading Co LTD. Axactor Invest 1 Sarl was prior to the aquisition fully consolidated by Axactor, as a result
of this there is a change between non-controlling interest and equity related to shareholders of the parent
company in the consolidated statement of changes in equity. 37,635 -
For additional information on agreements entered with related parties, see corporate governance section.
Note 32 Purchase price allocations
Axactor has not acquired any shares in other companies in 2021 or 2020.
Annual report 2021 111
Note 33 Pledged assets
EUR thousand 2021 2020
Group
977,958
776,050
Parent (Axactor SE)
530,843
271,504
All material subsidiaries of the Group are guarantors and have granted a share pledge and bank account pledge as part of the security package
for the revoving credit facility, see note 27. ReoLux Holding Sarl is not part of the agreement nor the security arrangement.
Note 34 Subsequent events
Acquisition of CR Services
On 3 January 2022, Axactor took control over 100% of the shares in the Italian debt collection agency Credit Recovery Services S.r.l. The business
combination is considered not to be material for the Group.
Conversion of Axactor SE to Axactor ASA
On 17 February 2022, the Board of Directors decided to initiate the process of converting Axactor SE from a Societas Europaea company to a
Norwegian Allmennaksjeselskap (ASA).
Conlict in Ukraine
The conlict in Ukraine does not directly impact Axactor’s operations. The Group’s ınancial and non-ınancial exposure to Ukraine is not material
but is being closely monitored.
Axactor Group112
Parent company statement of proıt or loss
For the year ended 31 December
EUR thousand Note 2021 2020
Management services to group companies 10,519 7,675
Other revenue - -
Total revenue 10,519 7,675
Personnel expenses 3 (4,922) (4,289)
Operating expenses 5
(7,394)
(6,331)
Total operating expense
(12,315)
(10,620)
EBITDA (1,797) (2,945)
Amortization and depreciation 6, 9, 10 (2,004) (1,665)
Operating proıt
(3,801)
(4,610)
Financial revenue 7 23,561 21,345
Financial expenses 7 (36,187) (44,720)
Net ınancial items (12,626) (23,375)
Proıt/(loss) before tax
(16,427)
(27,985)
Income tax expense 8 23 754
Net proıt/(loss) after tax (16,404) (27,231)
Distibution to share premium reserve
(16,404)
(27,231)
Annual report 2021 113
Parent company statement of comprehensive income
For the year ended 31 December
EUR thousand Note 2021 2020
Net proıt/(loss) after tax
(16,404)
(27,231)
Items that may be classiıed subsequently to proıt and loss
Net gain/(loss) on cash low hedges
18
(230)
-
Other comprehensive income/(loss) after tax (230) -
Total comprehensive income/(loss)
(16,634)
(27,231)
Axactor SE114
EUR thousand Note 2021 2020
ASSETS
Intangible non-current assets
Intangible assets 10 10,291 10,451
Deferred tax assets 8 - 1,227
Investment in subsidiary 12 532,086 334,804
Tangible non-current assets
Property, plant and equipment 9 71 103
Right-of-use assets 6 521 681
Financial non-current assets
Loans to group companies
15
290,507
116,030
Total non-current assets
833,475
463,296
Current assets
Receivables to group companies 15 37,310 38,438
Other current assets 13 664 404
Restricted cash 14 402 446
Cash and cash equivalents 14
4,182
10,542
Total current assets
42,558
49,830
Total assets 876,033 513,126
Parent company statement of ınancial position
For the year ended 31 December
Annual report 2021 115
EUR thousand Note 2021 2020
EQUITY AND LIABILITIES
Equity
Share capital 158,150 97,040
Other paid in capital 218,386 219,580
Other reserves 18 (230) -
Result for the year
(16,404)
(27,231)
Total restricted equity
201,753
192,349
Total equity 11 359,903 289,389
Non-current Liabilities
Interest bearing debt
16
491,369
-
Interest bearing debt from group companies
15
-
-
Deferred tax liabilities 8 167 -
Lease liabilities 6 401 558
Other non-current liabilities 230 -
Total non-current liabilities 492,167 558
Current Liabilities
Accounts payables
781
842
Current intercompany liabilities 15 15,607 18,999
Current portion of interest bearing debt 16 3,824 200,283
Taxes payable 8 1,962 1,787
Current portion of lease liabilities 6 156 144
Other current liabilities
17
1,632
1,124
Total current liabilities
23,964
223,179
Total liabilities 516,131 223,737
Total equity and liabilities
876 033
513 126
Parent company statement of ınancial position
For the year ended 31 December
Oslo, 30 March 2022
The Board of Directors
Merete Haugli
Board member
Brita Eilertsen
Board member
Terje Mjøs
Board member
Lars Erich Nilsen
Board member
Kathrine Astrup Fredriksen
Board member
Hans Harén
Board member
Kristian Melhuus
Chair of the Board
Johnny Tsolis
CEO
Axactor SE116
Parent company statement of changes in equity
For the year ended 31 December
Equity related to the shareholders of the Parent Company
Restricted Non-restricted
EUR thousand Share capital
Other paid in
capital
Other
reserves
Result for
the year Total
Total
Equity
Balance on 1 Jan 2020 81,338 188,033 (3,135) 184,897 266,235
Merger effect when merged with subsidiary Axactor AS
Transfer of prior years net result
1)
(3,135)
3,135
-
-
Result of the period (27,231) (27,231) (27,231)
Total comprehensive income for the period (3,135) (24,096) (27,231) (27,231)
New share issues (exercise of share options) 15,703 35,064 35,064 50,767
Cost related to share issues
(959)
(959)
(959)
Share-based payment
578
578 578
Group contribution - - -
Closing balance at 31 Dec 2020 97,040 219,580 (27,231) 192,349 289,389
Transfer of prior years net result
1)
(27,231) 27,231 - -
Result of the period (16,404) (16,404) (16,404)
Net gain/(loss) on cash low hedges
(230)
(230)
(230)
Total comprehensive income for the period
(27,231)
(230)
10,827
(16,634)
(16,634)
Acquisition of remaining 50% of Axactor Invest 1 - -
New share issues 61,110 27,318 27,318 88,427
Cost related to share issues (1,460) (1,460) (1,460)
Share-based payment
180
180
180
Closing balance at 31 Dec 2021
158,150
218,386
(230)
(16,404)
201,752
359,903
1) Ref. resolution in Annual general meeting on 10 April 2019 and 1 April 2020
Annual report 2021 117
Parent company statement of cash lows
For the year ended 31 December
EUR thousand 2021 2020
Operating activities
Proıt/(loss) before tax (16,427) (27,985)
Taxes paid 8 (1,787) (726)
Adjustments for:
- Finance income and expense
7
5,616
(5,340)
- Impairment of subsidiaries 7 6,760 26,946
- Net exchange gain /(loss) realized 7, 16 (1,350) 1,769
- Depreciation and amortization 6, 9, 10 2,004 1,665
- Impairment on inter company receivable 1,600 -
- Calculated cost of employee share options
81
81
Change in Working capital
1,500
2,881
Net cash low from operating activities
(2,003)
(709)
Investing activities
Investment / share issue in subsidiaries (148,100) (2,000)
Purchase of intangible and tangible assets 9, 10 (1,652) (2,130)
Interest received
1
4
Net group contribution received
4,346
4,234
Net cash low from investing activities
(145,405)
108
Financing activities
Proceeds from external borrowings 16 299,717 -
Loans to subsidiaries / repaid from subsidiaries
15
(176,593)
(37,975)
Interest paid
(21,217)
(14,539)
Lease payments 6 (144) (156)
Loan fees paid 16 (10,976) -
New share issues 50,792 50,767
Costs related to share issues (1,460) (959)
Net cash low from ınancing activities 140,119 (2,863)
Net change in cash and cash equivalents
(7,289)
(3,464)
Cash and cash equivalents at the beginning of period 10,988 14,801
Currency translation 886 (350)
Cash and cash equivalents at end of period, incl. restricted funds 4,584 10,988
Axactor SE118
Summary of notes to the
parent company
Note 1 Corporate information 120
Note 2 Summary of signiıcant accounting principles 120
Note 3 Personell expenses 121
Note 4 Key management compensation 121
Note 5 Other operating expenses and remuneration to auditors 123
Note 6 Commitments and leases 124
Note 7 Financial items 125
Note 8 Income tax and tax assets and liabilities 126
Note 9 Tangible assets 127
Note 10 Intangible assets 127
Note 11 Share capital and shareholder information 128
Note 12 Subsidiaries 129
Note 13 Other current assets 129
Note 14 Cash and cash equivalents 130
Note 15 Loans and receivables to group companies 130
Note 16 Borrowing 131
Note 17 Other current liabilities 132
Note 18 Hedge accounting 132
Annual report 2021 119
Notes to the parent company ınancial statements
Note 1 Corporate information
The Parent Company Axactor SE (publ), with Norwegian corporate
identity number 921 896 328 is a joint stock company, domiciled in
Norway. The registered address is Drammensveien 167, NO-0277
Oslo. The company’s shares are traded in Norway on Oslo Børs.
The Annual Report and Parent Company Report for Axactor SE (publ)
were adopted by the Board of Directors on 30 March 2022 and will
be submitted for approval to the Annual General Meeting on 21 April
2022.
Note 2 Summary of signiıcant accounting principles
These parent company ınancial statements should be read in
conjunction with the consolidated ınancial statements of the Axactor
Group, published together with these ınancial statements. With
the exceptions described below, Axactor SE applies the accounting
policies of the Group, as described in Axactor Group's disclosure, note
2 Summary of signiıcant accounting principles, and reference is made
to the Axactor Group note for further details. Insofar that the company
applies policies that are not described in the Axactor Group note due
to group level materiality considerations, such policies are included
below if necessary, for sufıcient understanding of Axactor’s accounts.
The principal accounting policies applied in the preparation of these
ınancial statements are set out below. These policies have been
consistently applied to all the years presented, unless otherwise stated.
As a result of rounding adjustments, the ıgures in one or more
columns may not add up to the total of that column.
2.1 Basis for preparation
The ınancial statements of the Parent Company are prepared
in accordance with simpliıed IFRS pursuant to the Norwegian
Accounting Act §3-9 and regulations regarding simpliıed application
of IFRS issued by the Norwegian Ministry of Finance on 3 November
2014. The Company follows the exception from IAS 10 regarding
timing of recognition of group contribution and dividend.
The Parent Company’s functional currency is Euro (EUR) and this is
also the reporting currency for the Group. All amounts in the ınancial
reports are stated in EUR thousands unless otherwise speciıed.
2.2 Investments In subsidiaries and associated companies,
and other non-current Investments.
Investments in subsidiaries are accounted for using the cost method
in the parent company accounts. The investments are valuated at
cost unless impairment losses occur. Write-down of investments are
recognized under 'Impairment' in the statement of proıt or loss.
2.3 Segment reporting
Axactor SE's activities are currently organized as one operating
unit for internal reporting purposes, thus no segment information is
presented in these ınancial statements.
Axactor SE120
Note 3 Personell expenses
Personell expenses
EUR thousand 2021 2020
Salaries
3,507
3,048
Bonus
806
25
Social contribution 479 384
Pension cost 103 107
Share Option program 83 81
Other beneıts
(57)
644
Total personnel expenses
4,922
4,289
Axactor SE meets the local mandatory occupational pension requirement.
Average number of employees
EUR thousand 2021 2020
Number of FTE's, start of year
16
18
Number of FTE's, end of year 19 16
Average number of FTE's 17 17
Post-employment beneıts
EUR thousand 2021 2020
Salaries - 528
Other beneıts - 1
Total post-employment beneıts
-
529
Note 4 Key management compensation
Board of Directors remuneration
EUR thousand 2021 2020
Glen Ole Rødland
2)
27 44
Bjørn Erik Næss - 34
Kristian Melhuus
1)
10 -
Lars Erich Nilsen 41 47
Kathrine Astrup Fredriksen 41 28
Merete Haugli
3)
54
41
Terje Mjøs
45
44
Brita Eilertsen 47 50
Hans Harén 41 21
Beate S. Nygårdshaug
1)
- 13
Total
306
322
1) Member until 2020
2) Chair of the board until May 2021
3) Interim chair of the board from May 2021 until February 2022
4) Chair of the board from February 2022
Annual report 2021 121
The following remuneration has been made to the members of the nomination committee during the year:
Nomination committee
EUR thousand 2021 2020
Anne Lise Ellingsen Gryte
1)
-
-
Magnus Tvenge - 3
Cathrine Loferød Feght
2)
- 3
Robin Bakken
2)
- 4
Total
-
10
1) Member from April 2020
2) Member until April 2020
Executive management remuneration 2021
EUR thousand Salary Bonus Pension Other Share option
1)
Total
Johnny Tsolis, CEO
410
87
35
1
39
573
Endre Ragnses, CEO
2)
- 44 - - - 44
Nina Mortensen, CFO
3)
92 20 7 1 - 120
Teemu Alaviitala, CFO
4)
44 16 2 - - 61
Arnt Andre Dullum, COO 178 18 16 2 17 230
Oddgeir Hansen, COO
5)
46 133 - - - 179
Kyrre Svae, Chief Strategy and IR 185 49 14 2 8
257
Vibeke Ly, Chief of Staff
199
29
14
1
17
261
Robin Knowles, Chief Investment Ofıcer 297 25 3 - 19 344
Total 1,451 420 91 7 100 2,069
1) Cost in relation to share option program, not exercised
2) CEO until 3 April 2020
3) CFO from 1 August 2021
4) CFO until 31 January 2021
5) COO until 1 July 2020
Axactor SE122
Executive management remuneration 2020
EUR thousand Salary Bonus Pension Other Share option
1)
Total
Johnny Tsolis, CEO
2)
336 109 6 1 72 524
Endre Rangnes, CEO
3)
700 329 6 - (45) 991
Teemu Alaviitala, CFO
4)
72 - 3 - 4 78
Arnt Andre Dullum, COO
5)
72 - 3 - 29 104
Oddgeir Hansen, COO
6)
270
94
6
-
(25)
346
Kyrre Svae, Chief Strategy and IR
7)
72
-
3
-
4
78
Vibeke Ly, Chief of Staff 169 37 6 - 25 238
Siv Farstad, EVP HR
8)
102 - 3 - (20) 84
Robin Knowles, Chief Investment Ofıcer 259 91 3 1 36 390
Total
2,051
660
40
3
79
2,834
1) Cost in relation to share option program, not exercised
2) CFO until 26 June 2020, interim CEO from 3 April 2020, permanent CEO from 26 June 2020
3) CEO until 3 April 2020
4) CFO from 1 August 2020 until 31 January 2021
5) COO 50% from 19 May 2020, 100% from 1 September 2020
6) COO until 1 July 2020
7) Chief of Stategy and IR from 1 August 2020
8) Head of HR until 31 March 2020
The CEO, Johnny Tsolis, has a six-month notice period and is entitled to a severance pay of six months in case of termination by the company. In
addition, there is a non-compete and non-solicitation clause in the employment agreement.
The share-based option program is presented in Group note 26. Bonus stated in tables above relects the paid amounts during the year. At the
end of 2021 no loan or prepayments were granted to Board of Directors and executive management.
Members of the executive management employed in Axactor SE has an additional contribution pension entitling them to pension rights for salary
over 12G (Norwegian Grunnbeløp).
Note 5 Other operating expenses and remuneration to auditors
Other operating expenses
EUR thousand 2021 2020
Direct operating expenses 972 1,008
External services 2,651 1,049
IT expenses 3,590 4,037
Other operating expenses
181
236
Total other operating expenses
7,394
6,331
Annual report 2021 123
Remuneration to company auditors
PricewaterhouseCoopers
EUR thousand 2021 2020
Audit 227 113
Audit related services
-
-
Tax advisory
55
33
Other services 15 79
Total 297 225
Note 6 Commitments and leases
The company leases premises only. The Facility contract was entered into 01.04.2020, and is being recognized as right-of-use asset and lease
liability from this date.
Leasing contracts are classiıed as lease liabilities and right-of-use assets under IFRS 16. See Axactor Group note 2.12.
Right-of-use assets
EUR thousand Buildings Total
Right-of-use assets at 1 Jan 2020
54
54
New leases 801 801
Depreciation of the year (174) (174)
Right-of-use assets at 1 Jan 2021 681 681
New leases - -
Depreciation of the year
(160)
(160)
Right-of-use assets at 31 Dec 2021
521
521
Remaining lease term 1-6 years
Depreciation method Linear
Axactor SE124
Lease liabilities
EUR thousand 2021 2020
Lease liabilities at 1 Jan 701 56
New leases and lease modiıcations - 801
Lease payments
(144)
(156)
Lease liabilities at 31 Dec
558
701
Current: 156 144
Non-current 401 558
The future aggregated minimum lease payments under lease liabilities are as follows:
EUR thousand 2021 2020
Undiscounted lease liabilities and maturity of cash outlow
< 1 year 185 181
1-2 years 188 185
2-3 years 192 188
3-4 years 49 192
4-5 years
-
49
> 5 years
-
-
Total undiscounted lease liabilities at 31 Dec
614
795
Discount element (57) (94)
Total discounted lease liabilities at 31 Dec 558 701
Note 7 Financial items
EUR thousand 2021 2020
Financial revenue
Interest on bank deposits
1
4
Interest on intercompany loans 12,778 16,468
Group contribution 4,323 4,625
Exchange gains realized 2,012 249
Net unrealized exchange gain 4,447 -
Other ınancial income
-
-
Total ınancial revenue
23,561
21,345
Financial expenses
Interest expense on borrowings (27,041) (15,498)
Exchange losses realized (662) (2,017)
Impairment of subsidiary (8,360) (26,941)
Other ınancial expenses
(123)
(264)
Total ınancial expenses
(36,187)
(44,720)
Net ınancial items (12,626) (23,375)
Annual report 2021 125
Note 8 Income tax and tax assets and liabilities
EUR thousand 2021 2020
Proıt/(loss) before tax
(16,427)
(27,985)
Adjustment prior year
(297)
-
Non deductable expenses 2 12
Other permanent differences 3,547 24,731
Interest expense limitation 8,118
Group contribution with tax effect 15,942 19,733
Change in deferred tax
(640)
(7,037)
Adjustment for currency differences due to tax calculation in NOK (119) 149
Basis for income tax
10,126
9,603
Taxes payable before tax decution scheme 2,227 2,113
Tax deduction scheme
1)
(265) (326)
Taxes payable 1,962 1,787
Change in deferred taxes
1,460
1,534
Adjustment for previouse year (158) 198
Tax effect on permanent difference - 1,431
Effect on foreign exchange rates (1,279) (180)
Tax on Group contribution
-
(2,228)
Income tax expense
23
754
1) Skattefunn - Tax deduction scheme in Norway for companies with research and develoment projects.
Temporary differences
EUR thousand 2021 2020
Current assets 214 175
Limitation interest carried forward 3,202 1,209
Tax losses carried forward, recognized - -
Differences not included in the calculation of deferred tax
(3,583)
(156)
Net income tax reduction temporary differences
(167)
1,227
Net deferred tax asset - 1,227
Net deferred tax liability (167) -
Net deferred tax (167) 1,227
Axactor SE126
Note 9 Tangible assets
EUR thousand Fixtures Ofıce eqipment Total
Cost price
Cost price at 1 Jan 2020
100
39
140
Acquisition 45 56 101
Cost price at 31 Dec 2020 145 95 241
Acquisition 6 7 13
Cost price at 31 Dec 2021 152 102 253
Amortization and impairment
Accumulated depreciations at 1 Jan 2020
(63)
(39)
(102)
Depreciation of the year (25) (11) (36)
Accumulated depreciations at 31 Dec 2020 (88) (50) (138)
Depreciation of the year (25) (19) (44)
Accumulated depreciations at 31 Dec 2021 (113) (69) (182)
Carrying amount at 31 Dec 2021
38
33
71
Useful life 3-5 yr 1-5 yr
Note 10 Intangible assets
EUR thousand Software Other Intangibles Total
Cost price
Cost price at 1 Jan 2020
9,385
2,264
11,648
Acquisition 1,549 481 2,029
Disposals at cost price (62) - (62)
Cost price at 31 Dec 2020 10,871 2,745 13,616
Acquisition 1,227 412 1,639
Disposals at cost price
-
-
-
Cost price at 31 Dec 2021
12,098
3,157
15,255
Amortization and impairment
Accumulated amortizations at 1 Jan 2020 (1,363) (409) (1,772)
Amortization of the year (1,144) (311) (1,455)
Disposals of accumulated amortizations
62
-
62
Accumulated amortizations at 31 Dec 2020
(2,445)
(720)
(3,165)
Amortization of the year
(1,447)
(352)
(1,799)
Disposals of accumulated amortizations - - -
Accumulated amortizations at 31 Dec 2021 (3,892) (1,072) (4,965)
Carrying amount at 31 Dec 2021
8,206
2,084
10,291
Useful life
3-10 yr
1-10 yr
Annual report 2021 127
Note 11 Share capital and shareholder information
Issued shares and Share capital
Number of
shares
Share capital
(EUR)
At 31 Dec 2019 155,395,464 81,337,590
New share issues, Feb 30,000,000 15,702,696
At 31 Dec 2020 185,395,464 97,040,286
New share issues, Jan
50,000,000
26,171,159
New share issues, Jan
40,000,000
20,936,928
New share issues, Mar 26,750,000 14,001,570
At 31 Dec 2021 302,145,464 158,149,943
Each share has the same rights and has a par value of EUR 0.523 (rounded). All issued shares are fully paid.
20 largest shareholders as at 31 Dec 2021
Name Shareholding Share %
Geveran Trading Co Ltd
138,920,892
46.0%
Torstein Ingvald Tvenge 10,000,000 3.3%
Ferd AS 7,864,139 2.6%
Verdipapirfondet Nordea Norge Verdi 4,454,162 1.5%
Skandinaviska Enskilda Banken AB 3,079,467 1.0%
Nordnet Livsforsikring AS
2,247,811
0.7%
Endre Rangnes
2,017,000
0.7%
Gvepseborg AS 2,009,694 0.7%
Stavern Helse Og Forvaltning AS 2,000,000 0.7%
Alpette AS 1,661,643 0.5%
Verdipapirfondet Nordea Avkastning 1,643,423 0.5%
Velde Holding AS 1,400,000 0.5%
Verdipapirfondet Nordea Kapital 1,343,933 0.4%
Klotind AS
1,296,693
0.4%
Andres Lopez Sanchez 1,177,525 0.4%
David Martin Ibeas 1,177,525 0.4%
Svein Dugstad 1,154,187 0.4%
Nordea Bank Abp 1,116,576 0.4%
Nordnet Bank AB
1,086,987
0.4%
Latino Invest AS
1,040,000
0.3%
Total 20 largest shareholders
186,691,657
61.8%
Other shareholders 115,453,807 38.2%
Total number of shares 302,145,464 100%
Total number of shareholders 11,128
Axactor SE128
Shares owned by related parties
Shareholding Share %
Latino Invest AS
1)
1,040,000 0.3%
Johnny Tsolis Vasili
1)
670,000 0.2%
Terje Mjøs Holding AS
3)
400,000
0.1%
Robin Knowles
2)
183,714
0.1%
Kyrre Svae
2)
150,000 0.0%
Vibeke Ly
2)
133,750 0.0%
Arnt Andre Dullum
2)
110,000 0.0%
Nina Mortensen
2)
95,000 0.0%
Hans Olov Harén
3)
22,150 0.0%
Brita Eilertsen
3)
19,892 0.0%
1) CEO/Related to the CEO of Axactor
2) Member of the Executive Management Team of Axactor
3) Member of the Board of Directors of Axactor / controlled by member of the Board of Directors of Axactor
Note 12 Subsidiaries
Subsidiary company
EUR thousand
Share of
owner-
ship
Share of
voting
rights
Ofıce
location,
city
Ofıce
location,
country
Book value
in parent
company
Result
2021
Equity
2021
Axactor Portfolio Holding AB
100.0%
100.0%
Gothenburg
Sweden
369,234
(27,902)
339,399
Axactor Platform Holding AB
100.0%
100.0%
Gothenburg
Sweden
162,852
(1,241)
132,674
Reolux Sarl
1)
50.0% 50.0% Luxembourg Luxembourg - (15,894) (7,383)
1) An impairment of EUR 6.8 million was recognized in 2021 due to reduced asset prices in the Reolux subsidiaries.
Note 13 Other current assets
Other current assets
EUR thousand 2021 2020
Prepaid expenses
675
407
Other current receivables
(11)
(2)
Total other current assets
664
404
Annual report 2021 129
Note 14 Cash and cash equivalents
EUR thousand 2021 2020
Cash and bank deposits
4,182
10,542
Restricted cash
402
446
Total cash and cash equivalents
4,584
10,988
Composition of the cash per currency
NOK 1,058 1,435
SEK
349
358
EUR 3,171 9,185
GBP 6 10
Total cash and cash equivalents
4,584
10,988
Note 15 Loans and receivables to group companies
2021 2020
EUR thousand
Loans to
group
companies
1)
Current IC
receivables
Loans
from group
companies
Current IC
payables
Loans to
group
companies
1)
Current IC
receivables
Loans
from group
companies
Current IC
payables
Axactor Portfolio Holding AB 6,417 218 - - (11) - -
Axactor Platform Holding AB 243,336 313 - 54,357 89 - (3,187)
Axactor Norway Holding AS - 4,322 - - 6,013 - -
Axactor Norway AS
-
718
-
(1,607)
-
1,152
-
(427)
Axactor Capital AS
4,452
17,947
-
(13,761)
-
19,241
-
(14,995)
Axactor Sweden AB - 435 - (120) - 220 - (179)
Axactor Germany Holding GmbH - 2,157 - - - - -
Axactor Germany GmbH - - - (17) - 1,605 - -
Axactor Espana, S.L.U. - (32) - (5) - 26 - -
Axactor Platform España S.A - 1,075 - (45) - 392 - (146)
Axactor Capital Luxembourg S.a.r.l.
-
172
-
- 41 - -
Axactor Italy Holding S.r.l.
156
-
-
16,758
-
-
-
Axactor Italy S.p.A 210 - - (24) 5,100 457 - (26)
Axactor Capital Italy Srl - 314 - - (21) - -
Axactor Invest 1 S.a.r.l.
2)
- 9,352 - - 8,960 - -
Reolux Holding S.a.r.l 35,936 50 - 39,815 12 - -
Axactor Finland Holding OY
-
270
-
-
-
-
-
Axactor Finland OY
-
-
-
(30)
-
262
-
(38)
Closing balance at 31 Dec
290,507
37,309
-
(15,607)
116,030
38,438
-
(18,998)
1) Loans to subsidiaries carries an interest rate of 6.3-7.38 %, to be paid at year end.
2) An impairment of EUR 1.6 million has been recognized in 2021 due to reduced real estate prices in Spain.
An ECL (Expected Credit Loss) assessment according to IFRS 9 has been carried out and concludes that there is no expected credit loss on
receivables to Group companies.
Axactor SE130
Note 16 Borrowing
EUR thousand Currency
Facility
limit
Nominal
value
Capitalized
loan fees
Accrued
interest
Carrying
amount, EUR Interest coupon Maturity
Facility
Bond (ISIN: NO0010914666) EUR 200,000 (4,778) 3,033 198,255 3m EURIBOR+700pbs 12.01.2024
Bond (ISIN: NO0011093718)
EUR
300,000
(3,853)
791
296,938
3m EURIBOR+535bps
15.09.2026
Total bond loan
500,000
(8,631)
3,824
495,193
Total borrowings at 31 Dec 2021
495,193
whereof:
Non-current borrowings 491,369
Current borrowings 3,824
EUR thousand
Bond
loan
Total
Borrowings
Balance at 1 Jan 200,283 200,283
Proceeds from loans and borrowings
500,000
500,000
Repayment of loans and borrowings
(200,283)
(200,283)
Loan fees (10,976) (10,976)
Total changes in ınancial cash low 288,741 288,741
Change in accrued interest 3,824 3,824
Amortization capitalized loan fees
1)
2,345 2,345
Currency translation differences
-
-
Total borrowings at end 31 Dec 2021
495,193
495,193
1) Includes expensed capitalized loan fees of EUR 0.4 million related to the reınansing of the bond
Maturity
EUR thousand Currency
Carrying
amount
Total future
cash low
Estimated future cash low within
6 months
or less 6-12 months 1-2 years 2-5 years
ISIN NO 0010819725 EUR 198,255 231,967 7,078 7,117 14,194 203,578
ISIN NO 0011093718 EUR 296,938 377,352 8,114 8,159 16,273 344,806
Total bond loan 495,193 609,319 15,192 15,276 30,467 548,384
Total Borrowings at 31 Dec 2021
495,193
609,319
15,192
15,276
30,467
548,384
Annual report 2021 131
Bond (ISIN NO 0010914666) ACR02 was placed at 3m EURIBOR +7.00% interest, with maturity date 12 January 2024.
The bond is listed on Oslo Børs.
The following ınancial covenants apply:
x Interest coverage ratio: >4.0x (Pro-forma adjusted Cash EBITDA to net interest expenses)
x Leverage ratio: <4.0x (NIBD to pro-forma adjusted cash EBITDA).
x Net loan to value: <75% (NIBD to total book value all debt portfolios and REOs)
x Net secured loan to value: <65% (secured loans less cash to total book value all debt portfolios and REOs).
Trustee: Nordic Trustee
Bond (ISIN NO 0011093718) ACR03 was placed at 3m EURIBOR +5.35% interest, with maturity date 15 September 2026.
The bond is listed on Oslo Børs.
The following ınancial covenants apply:
x Interest coverage ratio: >4.0x (Pro-forma adjusted Cash EBITDA to net interest expenses)
x Leverage ratio: <4.0x (NIBD to pro-forma adjusted cash EBITDA).
x Net loan to value: <80% (NIBD to total book value all debt portfolios and REOs)
x Net secured loan to value: <65% (secured loans less cash to total book value all debt portfolios and REOs).
Trustee: Nordic Trustee
Note 17 Other current liabilities
EUR thousand 2021 2020
Public duties 359 283
Personnel related liabilities 807 717
Other accruals
467
123
Total other current liabilities
1,632
1,124
Note 18 Hedge accounting
The Group´s risk management objective is to mitigate the effect of interest rate changes related to its loating rate instruments. In order to
achieve the objective, the Group´s strategy is to use derivatives to limit the impact of changes in interest rates on the Group´s interest expenses.
The Group applies cash low hedge accounting to ensure that the Group´s risk management strategy is relected in its ınancial statements.
Cash low hedges
Interest rate risk in loating rate instruments
The Group´s risk management objective and strategy is to apply cash low hedge accounting for interest rate risk in order to mitigate the effect
of increasing EURIBOR rates on issued bonds and therefore limit the impact on the Group´s interest expenses. The hedged items consist of a
proportion of issued loating-rate bonds. The hedged risk is deıned as interest rate risk for EURIBOR interest rates. The hedging instruments
consist of interest rate caps. The hedge ratio for the relationships is deıned by the ratio of the principal of the interest rate cap to the designated
proportion of the hedged item, resulting in 100% hedge ratio. Potential sources of ineffectiveness have been identiıed as differences in timing of
cash lows of hedged items and hedging instruments, derivatives used as hedging instruments having a non-nil fair value at the time of designation
and the effect of changes in counterparties’ credit risk on the fair values of hedging instruments or hedged items.
The Group started with hedge accounting at the end of 2021. All comparable ıgures for 2020 for the tables presented below are hence 0 and
not presented as separate tables. The Group’s strategy is to hedge between 50% and 70% of interest bearing debt with a duration of three to
ıve years.
Axactor SE132
The ınancial instruments designated as hedged items in current cash low hedge relationships are:
Hedged items - cash low hedges
Other reserves
EUR thousand Nominal amount
Nominal amount
designated for
hedge accounting
Changes in
fair value used
to calculate
ineffectiveness Continuing hedges
Discontinued
hedges
31 Dec 2021
Interest rate risk
Floating rate issued bonds
200,000
200,000
-
(230)
-
Total
200,000
200,000
-
(230)
-
The hedged items are included as part of interest bearing debt in the consolidated statement of ınancial position.
The table below sets out the derivatives designated as hedging instruments in current cash low hedge relationships, and the outcome of the
Group´s hedging strategy:
Hedging instruments - cash low hedges
EUR thousand Up to 1 year 1-5 years Over 5 years Total
31 Dec 2021
Interest rate caps
Nominal amount 2,778 197,222 - 200,000
Average strike 0.5% 0.5% - 0.5%
Carrying amount
EUR thousand
Nominal
amount Assets Liabilities
Changes in
fair value used
to calculate
ineffectiveness
Changes
in value
recognised
in OCI
Ineffectiveness
recognised in
proıt or loss
Amount
reclassiıed from
other reserves
to proıt or loss
31 Dec 2021
Interest rate risk
Interest rate caps
200,000
-
230
-
(230)
-
-
Total
200,000
-
230
-
(230)
-
-
The hedging instruments are included as part of other non-current liabilities in the consolidated statement of ınancial position. The effective
portion of the gain or loss on the hedging instrument is, if applicable, included as part of ınancial expenses. Hedge ineffectiveness is, if applicable,
recorded as part of ınancial expenses or ınancial revenue. Amounts reclassiıed from the cash low hedge reserve into proıt or loss are, if
applicable, recorded as part of ınancial expenses.
Annual report 2021 133
Auditor’s report
PricewaterhouseCoopers AS, Dronning Eufemias gate 71, Postboks 748 Sentrum, NO-0106 Oslo
T: 02316, org. no.: 987 009 713 MVA, www.pwc.no
Statsautoriserte revisorer, medlemmer av Den norske Revisorforening og autorisert regnskapsførerselskap
To the General Meeting of Axactor SE
Independent Auditor’s Report
Report on the Audit of the Financial Statements
Opinion
We have audited the financial statements of Axactor SE, which comprise:
• The financial statements of the parent company Axactor SE (the Company), which comprise
parent company statement of financial position as at 31 December 2021, parent company
statement of profit or loss, parent company statement of comprehensive income, parent
company statement of changes in equity and parent company statement of cash flows for the
year then ended, and notes to the financial statements, including a summary of significant
accounting policies, and
• The consolidated financial statements of Axactor SE and its subsidiaries (the Group), which
comprise the consolidated statement of financial position as at 31 December 2021, the
consolidated statement of profit or loss, consolidated statement of comprehensive income,
consolidated statement of changes in equity and consolidated statement of cash flows for the
year then ended, and notes to the financial statements, including a summary of significant
accounting policies.
In our opinion:
• the financial statements comply with applicable statutory requirements,
• the financial statements give a true and fair view of the financial position of the Company as at
31 December 2021, and its financial performance and its cash flows for the year then ended in
accordance with simplified application of international accounting standards according to
section 3-9 of the Norwegian Accounting Act, and
• the financial statements give a true and fair view of the financial position of the Group as at 31
December 2021, and its financial performance and its cash flows for the year then ended in
accordance with International Financial Reporting Standards as adopted by the EU.
Our opinion is consistent with our additional report to the Audit Committee.
Basis for Opinion
We conducted our audit in accordance with International Standards on Auditing (ISAs). Our
responsibilities under those standards are further described in the Auditor’s Responsibilities for the
Audit of the Financial Statements section of our report. We are independent of the Company and the
Axactor Group134
Independent Auditor's Report - Axactor SE
(2)
Group as required by laws and regulations and the International Ethics Standards Board for
Accountants’ International Code of Ethics for Professional Accountants (including International
Independence Standards) (IESBA Code), and we have fulfilled our other ethical responsibilities in
accordance with these requirements. We believe that the audit evidence we have obtained is sufficient
and appropriate to provide a basis for our opinion.
To the best of our knowledge and belief, no prohibited non-audit services referred to in the Audit
Regulation (537/2014) Article 5.1 have been provided.
We have been the auditor of the Company for 4 years from the election by the general meeting of the
shareholders on 17 October 2018 for the accounting year 2018.
Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of most significance in
our audit of the financial statements of the current period. These matters were addressed in the
context of our audit of the financial statements as a whole, and in forming our opinion thereon, and we
do not provide a separate opinion on these matters. The business activities are largely unchanged
compared to last year. We have not identified regulatory changes, transactions or other events that
qualified as new Key audit matters for our audit of the 2021 financial statements. The valuation of the
portfolios continues to be an important focus area in our audit.
Key Audit Matter How our audit addressed the Key Audit Matter
Valuation of debt portfolios
Debt portfolios represent a considerable
part of the Group’s total assets. The
valuation of the portfolios includes
substantial elements of management
judgement. The book value of debt
portfolios is determined by projecting
expected future cash flows and
discounting them to present value using
the effective interest rate as of the date
the portfolios were acquired.
Some of the key judgmental assumptions
related to the valuation includes the size
of expected future cash flows, and timing
of future payments. The estimated timing
and size of payments of cash flows require
judgement and experience to assess and
the estimates may differ from actual
timing and size of payments.
Management performed a review every
quarter in which they assessed the
performance of the group’s portfolios,
with particular focus directed towards
whether portfolios met certain
performance criteria. The procedure
was
We satisfied ourselves to the accuracy of initial
recognition of portfolios by tracing purchase prices in
the contracts back to registration in the system on a
sample basis. We also checked completeness, by
reconciling value per 31.12.2021 of the debt portfolios
from the database, which is used as a source for the
performance review, to the booked value. To test the
accuracy of managements assumptions about timing
and size of payments, we sampled and matched
reported cash collection to underlying bank statements.
Correspondingly, we obtained cash collection reports
and traced the amounts to the database.
We obtained a detailed understanding of
management’s review and relevant controls associated
with the review management performed quarterly, and
tested the control performed.
We sampled all portfolios not meeting management’s
defined performance criteria at year end. Based on
obtained documentation for these portfolios, including
inspection of the underlying figures in the database, we
challenged management’s assumptions and conclusions
noted in their review. We discussed with them their
assessments and tested assumptions, and where
deemed necessary, obtained and evaluated additional
documentation that substantiated management’s
Annual report 2021 135
Independent Auditor's Report - Axactor SE
(3)
designed to identify portfolios with need
to adjust the book value.
We focused on this area because
valuation of the debt portfolios carries the
inherent risk that judgmental
assumptions may affect the Groups net
profit.
conclusions. We performed recalculation based on our
own models to test the completeness and accuracy of
the company’s, portfolio database.
For one portfolio, management had obtained a separate
report to support their own judgement. We obtained,
read, and understood the report and met with the
experts management used. We tested whether the
experts based their calculations on accurate and
complete data from the company. We looked at the
model and the assumptions underlying the model and
considered whether the model contained the elements
that we expected and the reasonableness of the
assumptions. To understand the results from the
report, we held extensive interviews with the experts
where we challenged the methodology and
assumptions.
We assessed qualifications, competence, and objectivity
of the experts by among other, reviewing their terms of
engagement to determine whether there were unusual
terms that might have affected their objectivity or
imposed scope limitations upon their work. Based on
this work, we were satisfied that the experts remained
objective and competent, and that the scope of their
work was appropriate.
We discussed with management how the Covid-19
pandemic may have affected the assumptions
underpinning the value of the loan portfolios.
We also evaluated the models management used to
discount the cash flows and tested the accuracy of the
inputs and whether the models made calculations as
expected. Any differences encountered as part of our
detailed testing fell within a reasonable range.
The Group notes 2.12.1, note 3, note 4 and note 18 to
the financial statements are relevant for the description
of the Group’s debt portfolios. We read the notes and
found them to be adequate and give a balanced
overview of the different parameters and judgmental
assumptions used.
Other Information
The Board of Directors and the Managing Director (management) are responsible for the information
in the Board of Directors’ report and the other information accompanying the financial statements.
The other information comprises information in the annual report, but does not include the financial
statements and our auditor’s report thereon. Our opinion on the financial statements does not cover
the information in the Board of Directors’ report nor the other information accompanying the financial
statements.
Axactor Group136
Independent Auditor's Report - Axactor SE
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In connection with our audit of the financial statements, our responsibility is to read the Board of
Directors’ report and the other information accompanying the financial statements. The purpose is to
consider if there is material inconsistency between the Board of Directors’ report and the other
information accompanying the financial statements and the financial statements or our knowledge
obtained in the audit, or whether the Board of Directors’ report and the other information
accompanying the financial statements otherwise appears to be materially misstated. We are required
to report if there is a material misstatement in the Board of Directors’ report or the other information
accompanying the financial statements. We have nothing to report in this regard.
Based on our knowledge obtained in the audit, it is our opinion that the Board of Directors’ report
is consistent with the financial statements and
contains the information required by applicable legal requirements.
Our opinion on the Board of Director’s report applies correspondingly to the statements on Corporate
Governance and Corporate Social Responsibility.
Responsibilities of Management for the Financial Statements
Management is responsible for the preparation of financial statements that give a true and fair view in
accordance with simplified application of international accounting standards according to the
Norwegian Accounting Act section 3-9, and for the preparation and true and fair view of the
consolidated financial statements of the Group in accordance with International Financial Reporting
Standards as adopted by the EU, and for such internal control as management determines is necessary
to enable the preparation of financial statements that are free from material misstatement, whether
due to fraud or error.
In preparing the financial statements, management is responsible for assessing the Company’s and the
Group’s ability to continue as a going concern, disclosing, as applicable, matters related to going
concern and using the going concern basis of accounting unless management either intends to
liquidate the Group or to cease operations, or has no realistic alternative but to do so.
Auditor’s Responsibilities for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole
are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report
that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee
that an audit conducted in accordance with ISAs will always detect a material misstatement when it
exists. Misstatements can arise from fraud or error and are considered material if, individually or in
aggregate, they could reasonably be expected to influence the economic decisions of users taken on the
basis of these financial statements.
As part of an audit in accordance with ISAs, we exercise professional judgment and maintain
professional scepticism throughout the audit. We also:
• identify and assess the risks of material misstatement of the financial statements, whether due
to fraud or error. We design and perform audit procedures responsive to those risks, and
obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The
risk of not detecting a material misstatement resulting from fraud is higher than for one
Annual report 2021 137
Independent Auditor's Report - Axactor SE
(5)
resulting from error, as fraud may involve collusion, forgery, intentional omissions,
misrepresentations, or the override of internal control.
• obtain an understanding of internal control relevant to the audit in order to design audit
procedures that are appropriate in the circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the Company's or the Group's internal control.
• evaluate the appropriateness of accounting policies used and the reasonableness of accounting
estimates and related disclosures made by management.
• conclude on the appropriateness of management’s use of the going concern basis of
accounting, and, based on the audit evidence obtained, whether a material uncertainty exists
related to events or conditions that may cast significant doubt on the Company and the
Group's ability to continue as a going concern. If we conclude that a material uncertainty
exists, we are required to draw attention in our auditor’s report to the related disclosures in
the financial statements or, if such disclosures are inadequate, to modify our opinion. Our
conclusions are based on the audit evidence obtained up to the date of our auditor’s report.
However, future events or conditions may cause the Company and the Group to cease to
continue as a going concern.
• evaluate the overall presentation, structure and content of the financial statements, including
the disclosures, and whether the financial statements represent the underlying transactions
and events in a manner that achieves a true and fair view.
• obtain sufficient appropriate audit evidence regarding the financial information of the entities
or business activities within the Group to express an opinion on the consolidated financial
statements. We are responsible for the direction, supervision and performance of the group
audit. We remain solely responsible for our audit opinion.
We communicate with the Board of Directors regarding, among other matters, the planned scope and
timing of the audit and significant audit findings, including any significant deficiencies in internal
control that we identify during our audit.
We also provide the Audit Committee with a statement that we have complied with relevant ethical
requirements regarding independence, and to communicate with them all relationships and other
matters that may reasonably be thought to bear on our independence, and where applicable, related
safeguards.
From the matters communicated with the Board of Directors, we determine those matters that were of
most significance in the audit of the financial statements of the current period and are therefore the
key audit matters. We describe these matters in our auditor’s report unless law or regulation precludes
public disclosure about the matter or when, in extremely rare circumstances, we determine that a
matter should not be communicated in our report because the adverse consequences of doing so would
reasonably be expected to outweigh the public interest benefits of such communication.
Report on Other Legal and Regulatory Requirements
Axactor Group138
Independent Auditor's Report - Axactor SE
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Report on compliance with Regulation on European Single Electronic Format
(ESEF)
Opinion
We have performed an assurance engagement to obtain reasonable assurance that the financial
statements with file name 549300P5VT8OMA17TJ33-2021-12-31-en.zip have been prepared in
accordance with Section 5-5 of the Norwegian Securities Trading Act (Verdipapirhandelloven) and the
accompanying Regulation on European Single Electronic Format (ESEF).
In our opinion, the financial statements have been prepared, in all material respects, in accordance
with the requirements of ESEF.
Management’s Responsibilities
Management is responsible for preparing, tagging and publishing the financial statements in the single
electronic reporting format required in ESEF. This responsibility comprises an adequate process and
the internal control procedures which management determines is necessary for the preparation,
tagging and publication of the financial statements.
Auditor’s Responsibilities
For a description of the auditor’s responsibilities when performing an assurance engagement of the
ESEF reporting, see: https://revisorforeningen.no/revisjonsberetninger
Oslo, 30 March 2022
PricewaterhouseCoopers AS
Anne Lene Stensholdt
State Authorised Public Accountant
Annual report 2021 139
Alternative Performance Measures (APM) used in Axactor
APM Deınition Purpose of use Reconciliation IFRS
Gross revenue Total income plus portfolio amortizations
and revaluations, and change in forward low
derivatives
To review the revenue before split into
interest and amortization (for own portfolios)
Total income in consolidated
statement of proıt or loss
Cash EBITDA EBITDA adjusted for change in forward
low derivatives, calculated cost of share
option program, portfolio amortizations
and revaluations, REO cost of sales and
REO impairments
To relect cash from operating activities,
excluding timing of taxes paid and
movement in working capital
EBITDA (total income minus total
operating expenses) in consolidated
statement of proıt or loss and net
cash low from operating activities in
consolidated statement of cash lows
ERC Estimated remaining collection express the
expected future cash collection on own
portfolios (NPLs) in nominal values, over the
next 180 months
ERC is a standard APM within the industry
with the purpose to illustrate the future cash
collection including estimated interest
revenue and opex
Purchased debt portfolios in
consolidated statement of ınancial
position
Net interest bearing
debt (NIBD)
Net interest bearing debtmeans the
aggregated amount ofinterest bearing debt,
less aggregated amount of unrestricted cash
and cash equivalents, on a consolidated basis
NIBD is used as an indication of the Group's
ability to pay off all of its debt
Non-current interest bearing debt,
current portion of interest bearing
debt and unrestricted cash and cash
equivalents in the consolidated
statement of ınancial position,
adjusted for capitalized loan fees and
accrued interest according to note 27.
Return on equity (ROE),
including or excluding
non-controlling interests
Net result divided by average quarterly
equity for the period
Measures the proıtability in relation to
stockholders’ equity
Equity in consolidated statement of
changes in equity
APM tables
Gross revenue
EUR thousand 2021 2020
Total income
195,127
201,175
Portfolio amortizations and revaluations 148,542 123,179
Change in forward low derivatives 782 826
Gross revenue
344,451
325,180
EBITDA and Cash EBITDA
EUR thousand 2021 2020
Total income 195,127 201,175
Total operating expenses
(171,393)
(169,176)
EBITDA
23,733
31,999
Change in working capital related to forward low derivatives
782
826
Calculated cost of share option program 180 578
Portfolio amortizations and revaluations 148,542 123,179
REO cost of sale, including impairment
50,515
52,932
Cash EBITDA
223,752
209,514
Taxes paid
(3,261)
(5,515)
Change in working capital, excl. forward low derivatives 4,209 5,714
Cash low from operating activities before NPL and REO investments 224,700 209,713
Alternative Performance Measures
Axactor Group140
Estimated remaining collection, NPL
EUR thousand 2021 2020
Purchased debt portfolios
1,095,789
1,124,699
Estimated opex for future collection at time of acquisition 296,290 303,731
Estimated discounted gain 748,463 740,722
Estimated remaining collection, NPL
2,140,543
2,169,153
Net interest bearing debt (NIBD)
EUR thousand 2021 2020
Non-current portion of interest bearing debt 834,411 579,282
Current portion of interest bearing debt
3,845
356,903
Total interest bearing debt
838,256
936,185
Capitalized loan fees (17,566) (1,283)
Accrued interest 3,845 705
Nominal value interest bearing debt 851,977 936,763
Unrestricted cash and cash equivalents 38,155 47,779
Net interest bearing debt (NIBD)
813,821
888,984
Return on equity, excluding non-controlling interests
EUR thousand 2021 2020
Net proıt/(loss) after tax attributable to shareholders of the parent company
(32,797)
(18,131)
Average total equity for the period related to the shareholders of the parent company
384,751
296,222
Return on equity, excluding non-controlling interests
(8.5%)
(6.1%)
Return on equity, including non-controlling interests
EUR thousand 2021 2020
Net proıt/(loss) after tax
(45,992)
(34,002)
Average total equity for the period 407,454 375,526
Return on equity, including non-controlling interests (11.3%) (9.1%)
Annual report 2021 141
Active forecast Forecast of estimated remaining collection on NPL portfolios
Board Board of directors
Cash EBITDA margin Cash EBITDA as a percentage of gross revenue
Chair
Chari of the board of directors
Contribution margin (%) Total operating expenses (excluding SG&A, IT and corporate cost) as a percentage of total income
Collection performance Collection on own NPL portfolios in relation to active forecast
Equity ratio Total equity as a percentage of total equity and liabilities
Forward low agreement Agreement for future aquisitions of NPLs at agreed prices and delivery
Gross IRR The credit adjusted interest rate that makes the net present value of ERC equal to NPL book value,
calculated using monthly cash lows over a 180-months period
Group Axactor SE and all its subsidiaries
NPL amortization rate NPL amortization divided by NPL gross revenue
One off portfolio aquisitions Aquisition of a single portfolio of NPLs
Opex Total operating expenses
Recovery rate Portion of the original debt repaid
Replacement capex Aquisitions of new NPLs to keep the same book value of NPLs from last period
SG&A, IT and corporate cost Total operating expenses for overhead functions, such as HR, ınance and legal etc
Solution rate
Accumulated paid principal amount for the period divided by accumulated collectable principal amount
for the period. Usually expressed on a monthly basis
Yield Interest revenue from purchased loan portfolios
Terms
Axactor Group142
3PC Third-Party Collection
AGM Annual General Meeting
APM Alternative Performance Measures
ARM
Accounts Receivable Management
B2B Business to Business
B2C Business to Consumer
BoD Board of Directors
BS Consolidated Statement of Financial Position (Balance Sheet)
CF Consolidated Statement of Cash Flows
CGU Cash Generating Unit
CM1 Contribution Margin
D&A Depreciation and Amortization
Dopex Direct operating expenses
EBIT Operating proıt/Earnings before Interest and Tax
EBITDA Earnings before Interest, Tax, Depreciation and Amortization
ECL Expected Credit Loss
EGM
Extraordinary general meeting
EPS Earnings Per Share
ERC Estimated Remaining Collection
ESG Environmental, social and governance
ESOP Employee Stock Ownership Plan
FSA The Financial Supervisory Authority
FTE Full Time Equivalent
GHG Greenhouse gas emissions
IFRS International Financial Reporting Standards
LTV Loan to value
NCI Non-Controlling Interests
NPL Non-Performing Loan
OB Outstanding Balance, the total amount Axactor can collect on claims under management,
including outstanding principal, interest and fees
OCI
Consolidated Statement of Other Comprehensive Income
P&L Consolidated Statement of Proıt or Loss
PCI Purchased Credit Impaired
PPA Purchase Price Allocations
REO Real Estate Owned
ROE Return on Equity
SDG Sustainable development goal
SG&A Selling, General & Administrative
SPV Special Purpose Vehicle
VIU Value in Use
VPS Verdipapirsentralen/Norwegian Central Securities Depository
WACC Weighted Average Cost of Capital
WAEP Weighted Average Exercise Price
Abbreviations
Annual report 2021 143
Financial calendar 2022
Annual General Meeting 21.04.2022
Quarterly Report - Q1 28.04.2022
Quarterly Report - Q2 18.08.2022
Quarterly Report - Q3 27.10.2022
Quarterly Report - Q4 17.02.2023
Contact details
0277 Oslo
Norway
www.axactor.com
The shares of Ax actor SE (publ.) are listed on Oslo Børs, ticker ACR.
Cautionary Statement: Statements and assumptions made in this document with respect to Axactor SE’s (“Axactor”) current plans, estimates,
strategies and beliefs, and other statements that are not historical facts, are forward-looking statements about the future performance of Axactor.
Forward-looking statements include, but are not limited to, those using words such as “may”, “might”, “seeks”, “expects”, “anticipates”, “estimates”,
“believes”, “projects”, “plans”, strategy”, “forecast” and similar expressions. These statements relect management’s expectations and assumptions
in light of currently available information. They are subject to a number of risks and uncertainties, including, but not limited to, (i) changes in the
economic, regulatory and political environments in the countries where Axactor operates; (ii) changes relating to the statistic information available
in respect of the various debt collection projects undertaken; (iii) Axactor’s continued ability to secure enough ınancing to carry on its operations
as a going concern; (iv) the success of its potential partners, ventures and alliances, if any; (v) currency exchange rate luctuations between euro
and the currencies in other countries where Axactor or its subsidiaries operate. In the light of the risks and uncertainties involved in the debt
collection business, the actual results could differ materially from those presented and forecast in this document. Axactor assumes no
unconditional obligation to immediately update any such statements and/or forecasts.
axactor.com
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