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Operator: Good day, and thank you for standing by. Welcome to the VEF Third Quarter 2025 Earnings Call. [Operator Instructions] Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, David Nangle, CEO of the company. Please go ahead.
David Nangle: Thank you very much, Heidi, and good morning and good afternoon, everybody, and thank you once again for attending our results call this time for Q3 '25. My apologies to our investors and followers in the U.S. We started a bit earlier this time around, but can't be helped because of travel plans. But thank you for dialing in nonetheless. Going straight into -- and joining me on the call, as per always, will be our CIO, Alexis Koumoudos, who will join us for the valuation section and portfolio update. But going straight into the deck, going to Slide 2. And I guess just events of the quarter, but more really areas worth highlighting from today's release and what we're seeing, and it's really fourfold. One is NAV continuing to trend higher. It shouldn't be a surprise given the capital market trends, macro trends and everything we're seeing, but we're also seeing it through the prism of our portfolio. We ended the quarter at nearly $406 million of NAV, up 8.3% quarter-on-quarter and nearly 15% year-to-date. And that's just a nice supportive trends from markets, multiples, FX. But most importantly, it's really around the portfolio, which is now in a -- I like to think of it as a lower beta mode, breakeven, reigniting growth, better risk reward, and that's feeding through to the numbers that we're seeing in the portfolio that come through every month and every quarter as we see it. Point two is around Creditas. Clearly, our largest holding still in the portfolio. Two aspects on this, one fundamental to its performance, this reacceleration of growth that we're seeing in Creditas. It's not V-shaped, it's U-shaped. It's gradual. It's picking up. We're seeing the loan growth year-on-year from Q1 at 11%. It was very little year before year-on-year to 14% in Q2 and picking up again in Q3, given everything we see at the company. But then you cross-reference that with quality fintech companies attracting capital. And Creditas just announced its latest bond closure, raised $50 million senior bond, 10.5%, 3.5-year bond, but also made an announcement, a very high-level announcement about a month ago around a planned equity round of about $100 million -- minimum of $100 million at an indicative valuation of $3.3 billion. So it's an early high stage or high-level announcement that will be followed up upon, which we obviously press released, but it's just a sign that quality fintech companies are once again attracting the right kind of capital. Point three, and this kind of touches on the first two points is around fintech markets. They just are strong at the moment, and this is capital markets into fintech markets, and this is capital flowing in as well as capital flowing out. I think everybody grabs on the high-level announcements around Klarna IPO or Chime IPO in the U.S., and that's what grabs the front page of the financial press. But within our world and within the broader fintech ecosystem, we're seeing a lot of capital flowing into companies across early to late-stage rounds once again. So we're getting back to healthy capital inflow markets as well as capital flowing out, not just with IPOs, but also M&A and secondaries. And we see that in our portfolio, and there's plenty of examples, and it's just coming through from the broader ecosystem. And point four, the final point, not on this slide, but it's really around pipeline. This is an area that we're really spending more and more time on. We're getting more focused on a select number of quality EM fintech targets and just positioning ourselves and our shareholder capital for the right moment with the right asset at the right time to put the next Creditas [ EasyCo ] into our portfolio to work for medium- to long-term value accretion for all. Moving on to Slide 3, just a quick highlight on the numbers. As I said, from a dollar point of view, we tend to focus on NAV. Total NAV, we're now back over $400 million, given the performance year-to-date, $405.7 million, up 8% quarter-on-quarter, as I said. And from a SEK point of view, on a per share basis, we end the quarter at SEK 3.75 NAV per share in SEK terms, still trading at a fairly robust discount to that from a trading point of view, but that is starting to close in the markets. And finally, from my side on Slide #4, just a general path since inception of VEF and our NAV, not NAV per share, but overall NAV. And what we're seeing is an evolution of what we've been talking about for the last few quarters, mainly at the back end of last year, we talked about the reset and things starting to grow again, macro, micro factors working nicely in our favor. And that just gets reflected in your NAV as you start to grow again, and then that happens to feed through to share price and your market cap. And in markets like this, the discount tends to close as well and all kind of works in a nice manner once the trends continue. I will stop from my side at this point and come back at the end, but I'm going to pass over to Alexis, our CIO, who's going to talk you through some of the valuation moves and approaches we had in this quarter and some of the detail behind that. Alexis, over to you.
Alexis Koumoudos: Great. Thanks, Dave. Hi, everyone. Yes, just running through, I think, the major valuation approach and changes in the quarter. I think the biggest change in the quarter is really Konfio that had been marked at latest transaction for about a year. And we rolled it into a mark-to-model valuation methodology now. And that was a big contributor to our quarterly -- our quarter-on-quarter NAV change. Another driver, as you can see on Slide 5, being Creditas. Overall now, with Konfio joining the mark-to-model portion of the portfolio, the mark-to-model methodology accounts for 79% of the valuation methodology for the portfolio and 21% is now valued at latest transaction. And yes -- moving on to Slide 6. So on this slide, we just break down the third quarter NAV evolution. And you can see there are three big contributors to the quarter-on-quarter $31 million growth in our NAV. The first and biggest is the portfolio company performance, which contributed around $20 million in the quarter. The second -- and that's a factor of our portfolio companies growing and executing on their business plans. The second is strong equity market performance and the impact of it on our comps for the mark-to-model valuation methodologies in the portfolio, and that contributed $15 million. And with the further appreciation of the Brazilian real and the Mexican peso in the quarter, contributing another $6 million or so. And that -- there are some small like offsetting factors like our OpEx and coupon payments here. But all in all, those were the biggest drivers in the $31 million quarter-on-quarter growth in our NAV. Moving on to Slide 7. Because of the size of the change in Konfio valuation, we just wanted to walk you through the key contributors to this and why there was a 39% uplift in Konfio's valuation quarter-on-quarter. And there are three key components to this. So first of all, we have the company growth. What we've broken out here and shown is Konfio's loan portfolio has grown 30% year-on-year from August '24 when the last transaction happened to August this year. And then we've broken down some of the key comps that we use for Konfio here. And you can see that there was broad appreciation over the year that Konfio was held at latest transaction in share price and therefore, valuation of the comps. I think the biggest portion of that gain as well was felt in the last quarter where a lot of these stocks performed pretty well. Then the third component to it is the peso appreciation over the year. The peso appreciated 7% versus the dollar over the year. And when we stitch these together, these elements combined with the outlook that we have for Konfio and the business plan that we keep, this results in a 39% uplift over the course of the year for Konfio. And just moving on to Slide 8. So to reiterate, we continue to feel confident in our high-quality portfolio and its ability to compound from here. We see our portfolio growing around 30% year-on-year from a profitable and self-sustaining base. And Dave is going to talk a little bit about Creditas' reacceleration in an upcoming slide. We also definitely feel that we are entering a new cycle, as Dave alluded to at the beginning of the presentation. We're seeing a real pickup in fundraising activity across our core geographies and ecosystems with rounds like Creditas' upcoming that are taking shape. And this increased interest, we feel will definitely benefit our portfolio. Handing back to you, Dave.
David Nangle: Super. Thanks, Alexis, for that. Moving on to Slide #9. Just to focus on Creditas because it's been a busy year-to-date in fairness for the company. But I think on a fundamental point of view, this whole idea of reigniting growth is nice to talk about, but it's actually great to see in the numbers. And I guess -- when you talk about reigniting growth, there's elements of the market and people expect a V-shaped recovery, you go back to strong double-digit growth from no growth. But what you're seeing here is a gradual U-shaped recovery in the trends as the machine starts to reignite the lending machine, the underwriting process, which is great because there was a real focus in the years of 2022 and 2023 of efficiency of margins of asset quality of getting to that breakeven point and that sustainability point. And then you switch gears and you balance a better risk-reward model. And you're seeing the year-on-year trends on the top of the slide, the loan portfolio year-on-year trends on a quarterly basis, going from 1% year-on-year to 7% to 11%, 14%. That's a very simple, clear trend. And we see it once again going that feeding through to Q3 of this year, given the data that we're seeing on a monthly basis. So it's a nice trend. It's a gradual trend, getting to 20% to 30% growth level that Creditas feels is a sustainable level if compound at a cash flow neutral positive baseline as it moves forward over the next couple of years. And the revenues obviously feed off that balance sheet growth. And then the flip side of that or linked to that is capital does tend to flow towards companies that are performing in better environments and Creditas is no exception of that. They've just closed another bond, $50 million Eurobond, quite nice to see them closing that. But obviously, a month ago, they did, as I said at the start, they announced the planned fund raise, $100 million, indicative valuation, $3.3 billion, which they believe is coming their way. We keep that very high level until things are firm and concluded. But it's very clear that we welcome any fundraise, debt equity that strengthens Creditas' capital position. It's good news for the company. It's good news for us and where the company is growing. And when all those details become firm, finalized, we will clearly communicate them to the market, a; and b, reflect them in our NAV. Moving on to Slide 10, just getting a little bit more micro on these healthy markets. And one can't go too far on overdoing how healthy they are. But just versus 2022 when the music stopped in 2023 when it was tumbleweeds, there's just been a gradual pickup in activity through '24 and '25 across. We see both sides, private, public entries, exits. We see it in emerging. We look at developed for lead indicators. But in emerging, the benchmark -- we play a lot in Mexico, Brazil and India. There's a lot of strong double-digit million and triple-digit million fundraisers happening across benchmark fintech names, of which some of ours are benefiting. We talked about Creditas just now, but also Juspay earlier this year. So our portfolio companies are benefiting with capital coming in. It also helps us with capital going out. We did a bit of secondary in Juspay. The IPO markets are very healthy -- getting healthier, sorry, in the U.S., and the U.S. tends to lead and the world tends to follow, albeit India has been healthy and we IPO-ed BlackBuck in that market. But we know there are a number of companies getting ready for IPO across a number of scale emerging markets following the U.S. lead. So these are just good trends, capital flowing in and out of the industry is good for our business and for our companies and what we do on a kind of a macro bigger picture level. And then Slide 11 before I wrap up. And just the whole cash and balance sheet, we've been keeping the market up to date on this. I think we've been very focused on getting cash in. We've been talking a lot about it through '24 into early '25. I think the three exits we did, which we've talked -- maybe over talked about at this stage, has put us in a very solid position from a balance sheet point of view and from a debt leverage point of view. We ended the quarter with $17.6 million of cash on balance sheet. Our debt position after paying down approximately half of our debt earlier this year is just over 5% of our NAV at $25 million. So we're in a very comfortable debt position. And we've also used the opportunity year-to-date to be buying back our shares when the discount actually touched nearly 60% at one point. It was just the most obvious thing to do with our capital. We bought back over 2% of our shares, about $5.3 million. So it's been a good exercise in capital in delivering exits, delivering the NAV and then the most logical capital allocation tools as you work through your debt and deleveraging, buying back your shares. And now we're into a -- it's nice to be getting to a point where you can sit back and have a good healthy debate at team and Board level around capital allocation strategy, where we're going from here with the next incremental dollar in, cross-referencing our debt position, which is a lot lower, our equities, which is the discounts closing with the pipeline that we're seeing, and it's a much more robust debate as opposed to one dimensional obvious, we'll pay down our debt, we'll buy back our shares, then we'll get back to investing. So it's a nice evolution of that. And finally, just to wrap up, pretty similar to last time, and we are a beast of consistency, but we try and do that and then we tweak as we go. Look, it's always been about the portfolio. We talk a lot about Creditas, Konfio, and Juspay because they dominate, they're over 80% of our NAV. So it's natural we do so. And the reigniting growth we're seeing at Creditas and Konfio is clear. Juspay continues to compound at a healthy level, and hence, it was able to raise capital earlier this year, and we were able to take money off the table. And fresh capital is coming into our company, which is great. But there is a number of companies coming through. And maybe that's a point for next quarter's update. I alluded to companies like Abhi growing triple-digit percentage growth in a lot of its key metrics, and is a company that's doing exceptionally well in Pakistan and into the Middle East. Rupeek gold lending in India is getting a very strong tailwind from the gold price and its core business. Juspay, which is solar panel ecosystem distribution into lending, and is producing record results month-on-month for August into September, and it's feeling very good about itself again. So a lot of this is macro markets, capital trends, but then it feeds into the micro level delivery and it spits out results. So maybe that's one for next quarter. We get a little bit deeper into behind the big three, which we tend to overfocus on. I think the exits we've done so far over the last 12 months have been good. We have no pressure to push anything out the door at the wrong price. We do have offers for different names as we go, and we're selective in what we do, right asset, right time, right check, right price. And we're pretty confident that we could get more out the door in the next 3 to 15 months as we look ahead. And capital allocation has become a broader debate of what is the next most important thing. I think it's a healthy debate, but quite obvious, we've been doing the most obvious next thing with our debt into our equity. And it's just nice to be in a capital comfortable position with options on the table, and we'll continue to do what's best for shareholders, both from a short-term value accretion point of view, but obviously a long-term growth point of view. And that kind of touches on pipeline. And this is probably one of a bit like some of the smaller names in our portfolio, which is worthy of a slide or 2 in the next time we give an update. But pipeline work is getting a lot more focused. We're enamored by a kind of very focused number of fintechs that we've been very close to over the last 3 to 5 years, tracking them and scale in emerging markets, staying close to the founders and their shareholders, watching them trend positive as they come out of the last cycle. And we're just positioning ourselves as we have always done in the past to make sure that we are a capital allocator of choice for best-in-class fintechs who want capital to be with them for their next part of the journey. So these are healthy work streams, debate that we're having at the moment, but it's taking a lot more of our time as we go. But I will stop there and maybe, Heidi, operator, if you want to open up to any questions there are from the floor.
Operator: [Operator Instructions] We will take our first question, and the question comes from the line of Linus Sigurdson.
Linus Sigurdson: Starting off, is there anything at all you can say about how the capital raise for Creditas is progressing? And just on a high level, any indication on what we should expect in terms of a timeline around a potential outcome?
David Nangle: No, look, it's the right question to ask, and I'd do the same if I was in your seat. And we're a little bit or a lot restricted in what we can and can't say for obvious reasons. I guess what I would say is that they wouldn't have made an announcement unless they thought it was real, and then we wouldn't have followed up unless we thought it was real. So that's just probably point number one. And timing is just difficult. It's difficult because these things can take time because there's parties involved and there's structuring and the legals. But I guess the indication that they actually felt confident enough to put it out there in the first place would give you the shorter than longer feel in terms of timeline.
Linus Sigurdson: Okay. That's helpful. And then my second question was on Konfio. You mentioned how the comp set has come up mainly in the last quarter. But can you say anything about how operational momentum has progressed sequentially throughout this past year?
David Nangle: Yes. No, that's fair. And obviously, the core delivery of these companies is key for them and for us. And actually, the reason I called a little bit earlier is I'm off to D.C. for a Konfio Board meeting. So we're doing a good session there with all key shareholders in place. But now they started off the year super strong. Loan growth really picked up. So whereas the kind of Creditas performance has been a gradual reacceleration and Creditas is clearly more transparent in its information. So I guess I always apologize when we can't show what we want to show. Konfio front-loaded a lot of its growth in the first half and it's slowing a bit now. But overall, we're probably going to end the year in a very similar outlook for Creditas and Konfio where they both end up in that 20% to 30% credit growth for the year. Margins are holding strong. Asset margins at about 50%. Pricing is not under pressure in the market that it's playing in. And it's getting more and more efficient on the cost base. Actually, Konfio is probably one of the more impressive companies in our portfolio with use and impact already of AI tools, and it is cash flow positive. So it's building a little bit of cash. One focal point, and we've talked about this line before, and it's been something that I've talked about for a number of quarters is around the licensing, the bank license application, which is very clear and transparent for Konfio and will be a fundamental game changer in terms of franchise value as well as a cost of funding game changer in terms of how they fund themselves. That's just an ongoing process. For me, it's a when, not if scenario. I'd like to think it's in the bag by year-end, given what we've seen with other fintechs like Revolut, [ Plata ], there's been a number over the last 2 or 3 years who have been received their banking license. And I fully believe we're next in line. But I hate to put timing on these things because we get them with regulators. So I think operationally, directionally positive, a bit like Creditas, albeit more front-loaded for this year anyway, next year will be different. And then regulatory rise and fundamentally to the valuation of the business and where it's going, the bank license is the key.
Linus Sigurdson: That's very much appreciated. And then I wanted to ask on your other investments line in your NAV keeps getting larger. And is there anything you can say about the general direction of travel in that end of the portfolio in terms of operating performance?
David Nangle: Yes. No, like I alluded at the end of the presentation. What we'll do is we'll do a session in the next results deck where we get into some of the names beyond the top 3 because even though the top 3 dominate over 80%, there's still a big state that's not the top 3. And there are names like Abhi. It's really growing exceptionally fast. It's the only fintech in Pakistan with a banking license, which gives an exceptional position to enable growth and value creation, but it's also doing very well in the Middle East and the interaction between the two regions. As I said with Solfacil, the solar lender and ecosystem play in Brazil. Once again, their trends are picking up very strong, strong double-digit growth in that name. And Nibo is another one I didn't mention in the accounting stats from software like [ Fortnox ] for Brazil, we're seeing this kind of 30% to 40% compounding profitable growth now, albeit from a small base, don't get me wrong because these aren't scale like Creditas. And so there's -- it's -- I mean there's some which are going less exciting in there, as you would expect. But it's -- I think we're going to see some breakout names coming out of there into the top end of the portfolio that we'll be highlighting a more consistent basis as we go forward.
Linus Sigurdson: Okay. And then my final question, could you comment anything about how you think about exits near term in terms of should we think more like full sales or more like your partial exit in Juspay?
David Nangle: Yes. No, that's fair. We think about it a lot. And what we've learned -- you learned a lot doing this over time, but you should always be trying to exit. You should always be looking for the dollar in and you should owe -- and you're not forcing anything, but it just should be constant. So we have a number of work streams and people owning those work streams across different areas, M&A, IPO, secondaries and across key individual names. And more likely than not, it will be slicing of positions like what we did with Juspay. So you stay in the game of company X or company Y. You take a sliver off the table, $10 million, $20 million of top 3, for example. And as you go, as they raise money or somebody leans in versus a wholesale exit of a company. So I think historically, people tended to think about exit as your IPO or maybe your M&A. What investors are getting more and more comfortable and used to is that the secondary market for private companies is becoming a more real thing. We're seeing obviously daily flow in big global private companies like Stripe, for example, and SpaceX, there's daily markets in them. But that trend and theme is actually flowing down to smaller markets, emerging markets and smaller stocks, albeit it's less liquid at the gray market, but it's more and more happening. And doing them around events when a company is raising like Juspay did this year, it's easy, but around that, there's a lot of conversations going on constantly. And that's also from the shopping and the investment side. So when there's -- when we're looking at a pipeline of 5 companies or 10 companies, yes, you're waiting for the next fund raise to be part of that lead it or be part there in. But in between funding rounds, there's always areas where you can clean up cap tables, buy secondary and buy employee shares, the founder might want to take some money off the table. So it's becoming a much more intricate area of capital in capital out as opposed to the plain vanilla Series A, B, C, D is the way in, and M&A and IPO is the way out.
Operator: There are no further questions. I would like to hand back for closing remarks.
David Nangle: Super. Thank you, Heidi. Look -- and thank you, everybody, for dialing in at a slightly earlier time this time around. We're pretty happy where we're at from a business point of view year-to-date and how everything is going, but there's a hell of a lot more work to do. We're quite excited. We're working hard. And it's not just the short term in terms of what we're doing with the exits, the buybacks, to pay down debt, but it's also reigniting growth in our portfolio companies, but also in our pipeline engine for putting more capital to work in the medium term into the next-gen winners at VEF because -- we're 10 years old or young at this stage, but we're looking forward to the next 10 to 20 years of doing more of the same, but obviously bigger, better, faster. So thank you very much.
Operator: This concludes today's conference call. Thank you for participating. You may now disconnect.