KRUK Spólka Akcyjna

KRUK reported 2025 EBITDA and cash EBITDA up 12% year over year, assets up 12%, and year-end portfolio assets of PLN 11.6 billion. Net profit was weaker than operating growth because of taxation, a deferred tax reserve build, Romanian RON depreciation, and roughly PLN 30 million of digital transformation OpEx; the company also cited about PLN 41 million of FX impact from RON depreciation and about PLN 60 million of positive hedging impact. Leverage ended at 2.6x net debt to cash EBITDA, ROE was 20%, 2025 investments were PLN 2.2 billion, and the investment return was about 21% gross IRR and 3x money multiple. For 2026, management said investments should be more than in 2025, roughly PLN 2.4 billion to PLN 2.7 billion, with a return to Spain likely in the second half and similar-sized spending in France versus 2025.

Michal Zasepa framed 2025 as a strong but not fully on-plan year: the business hit record operating profit measures, grew assets, and maintained disciplined leverage, but came in below original investment ambitions mainly because of Spain and a more competitive market environment. He stressed that the company is still seeing resilience in its back book and that recoveries remain above accounting forecasts by a meaningful margin. His tone was confident and strategic, emphasizing the multi-year digital transformation, the planned reorganization into a more investment-company-like structure, and the goal of improving long-term risk management and scalability.

He emphasized that 2025 operating growth was healthy despite roughly PLN 70 million of added costs from FX and digital transformation, plus higher salaries and some legal costs. Finance costs rose because of higher debt, partly offset by lower rates and about PLN 60 million of hedge gains. He also noted the balance sheet stayed conservative, with net debt to cash EBITDA at 2.6x, and highlighted that the company continues to have good access to bank and bond funding. On taxes, he said the higher effective tax rate reflected deferred tax accounting changes and that the group will not be subject to Pillar Two GloBE in 2026 or 2027 because it did not exceed the EUR 750 million revenue threshold.

In Q&A, management explained that the planned reorganization is mainly for business and risk-management reasons, not a strategy change, and said the structure should also help avoid any additional Pillar Two tax on securitization funds if Polish tax authorities give a positive opinion. They said 2026 investments should be above 2025, around PLN 2.4 billion to PLN 2.7 billion, and that Spain could restart buying in the second half of the year depending on recoveries and market opportunities. Management also said France investments should stay roughly similar to 2025 despite lower recoveries, and that future incentive plans are expected to revert from profit before tax back to EPS once the tax environment is stable.