After an exceptional year, where it was able to generate a record net profit of 16.6 million dinars, “Tunisia Leasing & Factoring” (TLF) is starting 2023 under good auspices. This is in any case what emerges from the results which were revealed during its financial communication organized, Thursday, May 18, at the headquarters of the Tunis Stock Exchange.

During the first quarter of 2023, TLF continues to consolidate its leadership in the leasing market with 19% market share, compared to 44% for the factoring activity. “Our daily battle is not that of market share, we don’t want to be first to be first. What is important for our partners are our results”, underlined, in this sense, Hichem Zghal, general manager of the company. At the end of March 2023, the leasing activity showed strong growth with increases in force amounting to 100 million dinars.

“If we continue at this pace, we can end the year at 400 million dinars, while we have budgeted 375 million dinars for enforcement,” continued the company manager. With the slight increase in outstandings, the stabilization of the rate of hooked assets as well as the improvement in the cost of risk which was, during the first quarter, at -0.4% of outstandings, the recovery in activity is confirmed. “The improvement in the situation of the portfolio has made it possible to make collections which have diluted the risk, whereas the assumption provided for a cost of risk at 1.3%. If we continue with this situation, the impact on the result will be significant,” he added.

On the factoring side, the figures also show a good performance with a turnover established at 140 million dinars, an increase in outstanding financing, a rate of attached assets still under control (4.3%) and a cost of risk not exceeding 0.4%.

A record net result

Returning to the results of 2022, the CEO of the company recalled that TLF was able to generate a record net result of 16.6 million dinars. On a consolidated level, the profit was nearly 21 million dinars. For the leasing activity, production exceeded 340 million dinars, the portfolio outstanding amounted to 700 million, the assets attached to leasing are 11.7% and the cost of risk is 1.3%. outstandings.

“We are far from what we experienced compared to previous years, because of the different situations through which the leasing sector has gone. We are gradually returning to normal levels. Since 2019, with the deterioration of the economic situation and the Covid crisis, our company’s priority has been to strengthen its fundamentals. Commercial activity and ranking in terms of market share have not been our priority. It was necessary to be prudent, but above all to cover the latent risks. We preferred to play it safe and continue to provision and this effort continued until 2022”, underlined Zghal.

He added that the factoring business has been able to hold up over the past few years, and grow in a resilient manner. Significant growth was thus recorded in terms of turnover (15%), but also in terms of outstandings (30%). For the manager of the company, maintaining the rate of hung assets and the cost of risk (which is 0.2% of outstandings) at an extremely low level is “a sign of prudence and good risk management” . With regard to the related activity, “long-term rental”, thanks to which TLF manages a car fleet of 700 vehicles, the turnover amounted to 16 million dinars, posting a growth of 20% during 2022.

Rely less on external resources

The CEO of the company also indicated that the enforcement is mainly dominated by light rolling stock (70%). The distribution of the portfolio by sector of activity reveals a diversification of customers with a dominance of the sectors of trade and services (55%) followed by industries (23%), tourism (10%), construction (8%), and agriculture (4%).

In terms of resources, the company relies less on external resources, explains the CEO of the company. Indeed, with the drop in the money market rate, local resources have become more competitive. In addition, exchange risks and the downgrading of the country’s rating have contributed to the increase in the cost of external resources.

Zghal concluded the presentation with the introduction of “TLFNet”, the first digital leasing platform in Tunisia. As part of the company’s digital development strategy, this new platform aims to digitize the customer journey. It allows users to consult their leasing transactions, obtain all the information they need and download their invoices.