CFSL - Annual report 2018

Group Review Cim Group has had a very satisfactory year financially. While the Group operating income was inline with the financial year 2017 at MUR 1.6bn, profit from continuing operations increased by 16% to MUR 352.1m. This year was a year of consolidation and focus. We undertook a comprehensive strategic review of the Group’s businesses and future outlook. The decision to sell Cim Global in 2017 was made with the recognition of the consolidation internationally in the Global Business sector and the decision to focus our development plans on our financial services and property businesses. At a Group level, we feel that separately listing our financial services and property businesses will create two better focused groups – CIM Financial Services Ltd (“Cim”) for financial services and Lavastone Ltd for property investments. With Lavastone Ltd operating as a fully independent company, it shall also be able to better execute its strategic plan through a more focused management team and its board of directors. This also provides current and future shareholders with an opportunity to benefit from growth prospects in the real estate sector. At a Group level, we also made the decision not to pursue a banking opportunity. We decided that Cim will focus on the development of its core consumer finance business in Mauritius and the region, as well as strengthening our leasing, credit card and factoring propositions. We feel that Cim Finance Ltd has a unique positioning in the market, in particular in consumer finance where we provide access to finance to more than 250,000 Mauritian clients. During the course of the year we made the decision, along with our co-investors, to exit the Ethiopian leasing business First Capital Goods Financing (FCGF). Unfortunately, regulatory requirements imposed as licensing conditions meant that the investment was no longer attractive. GROUP CEO’S OUTLOOK We have invested a significant amount of management time and investment into strengthening our core Mauritian business. We acquired Mauritian Eagle Leasing Company Limited (MELCO) during the year from IBL Group. Cim Finance Ltd is one of the largest leasing companies on the island and we felt that MELCO’s leasing portfolio client base and capabilities of the team complemented those of Cim Finance Ltd. We have also focused some of our investment in technology in Cim Finance Ltd over the last year and will continue to do so going forward. Wehave implementedanenterprisedatawarehouse (EDW) that will enable us to get a 360-degree view of our customers.Wehave started the journey of driving advanced analytics off the EDW that is enabling us to obtain real-time insights across different areas of our business that will enable management to make better and quicker business decisions. We have also automated a number of our core lending processes that now enables straight through processing of the loan application and approval process within a few minutes. Cim Finance Ltd processes over 500,000 small ticket size loans each year, therefore optimising the efficiency of our lending processes leads to significant improvements in turnaround time and customer satisfaction. We have piloted and are looking to launch a digital platform for our retail merchant partners that will enable a more efficient and customer centric process for the over 600 merchants where we do not have a point of sale process. In the new financial year we will also look to roll out an app to our customers, as we have done in Kenya. We have commenced operations of our fintech hire purchase business in Kenya. We engaged a technology partner to support us in deploying a fintech-enabled business model leveraging upon Kenya’s unique mobile digital ecosystem and high consumer awareness of mobile phone app-based lending platforms. We are now partnering with a number of established consumer electronic and furniture retail players in Kenya, as we do in Mauritius, and looking to further expand our retail partner footprint. We have piloted the technology and business model for the second half of FY18 in Kenya and will now look to scale the business up in the new 18 CIM FINANCIAL SERVICES LTD ANNUAL REPORT 2018