Interview: EOS Board on the 2023/24 financial year

Successful performance despite economic challenges: How business has developed in the regions, why sustainability remains a key focus area, and how EOS is optimally prepared for the future. Board interview with CEO Marwin Ramcke and Board members Justus Hecking-Veltman (CFO), Carsten Tidow (Eastern Europe), Stephan Ohlmeyer (Central Europe), and Sebastian Pollmer (Western Europe).

Marwin Ramcke: 
We are looking back on a challenging yet highly successful financial year. Once again, we have had high interest rates, the war in Ukraine, and high inflation across large parts of Europe to contend with this year, and will continue to have to do so. But we are ready and motivated to take on these challenges. As a strong economic partner, we are optimally positioned. Given the situation described, this is a very good result – in fact it is the second highest result achieved to date in the 50-year history of the EOS Group. We owe our success to our more than 6,000-strong workforce. Every single employee played their part and I would like to take this opportunity to thank each and every one of them. The countries I would particularly like to highlight in this context are France, Denmark, Poland, Bulgaria, Bosnia and Herzegovina, Greece, and Slovenia, which produced particularly good results this year. 

Justus Hecking-Veltman:
Despite the decline in earnings, our performance this year was robust once again, our international teams have done an outstanding job. Although our investments have fallen overall, we succeeded in making a number of significant debt purchases in the double- or triple-digit million range, thereby cementing our strong market position. The purchase of receivables portfolios will also remain a key focus area of the EOS Group in the future. Our sights are set on long-term success.

Marwin Ramcke:
A key topic for us was the implementation of the NPL Directive, which we are handling with the utmost care. I am also very proud of our first ESG risk rating, which we received last year from the renowned rating agency Morningstar Sustainalytics. EOS is ranked among the top two percent of all companies rated in the “Consumer Finance” sector. The fact that we achieved this top position right away shows that our corporate responsibility strategy is working. Furthermore, the result gives us an incentive to become a little better every day. After all, sustainability will remain at the heart of our operations.

I am also delighted that we were able to welcome two new members to the EOS Board: Dr. Stephan Ohlmeyer for the newly created Central Europe region and Sebastian Pollmer for Western Europe.

Stephan has a great deal of experience in the market and Sebastian, at his young age, brings extensive EOS know-how and substantial innovative drive to the table. I think this is an important signal to all colleagues that we at EOS are actively seeking change and are open to new approaches.

There will also be another no less significant change this year: I am delighted to report that Dr. Eva Griewel, a fantastic former colleague and first-rate financial expert, will be returning to EOS with effect from August 2024 to assume the role of CFO. I would also like to take this opportunity to extend my heartfelt thanks to our current CFO Justus for his achievements, outstanding commitment, and integrity. He deserves my utmost respect: He is part of the enormous success story that EOS has been able to write in recent years.

Justus Hecking-Veltman:
Thank you, Marwin! I can look back on 17 magnificent and successful years at EOS, during which we invested over EUR 7 billion and achieved an annual double-digit return on capital – a result that is testament to the Group’s extensive expertise in the evaluation of investment opportunities and high operational performance. I would like to thank all of my colleagues in the EOS Group and the Otto Group for the trusting cooperation we have shared! I wish my successor Eva Griewel all the very best in her new role.

Stephan Ohlmeyer:
I can add that I feel very welcome and well received at EOS. I am particularly impressed by the drive and energy demonstrated by all of my colleagues. The new Central Europe region will create enormous synergies for joint business development and is an asset to the entire EOS Group.

Sebastian Pollmer:
I am delighted to be able to assume responsibility for the magnificent Western Europe region. Our companies in this region are highly developed and will continue to be strong partners for banks and corporations in the future. Diversity and cooperation are important success factors here, which is why I am committed to creating equal opportunities for all, focusing particularly on the areas of gender equality and empowering women in leadership positions.

Carsten Tidow:
The Eastern Europe region achieved a fantastic result with a strong operational performance and high investments totaling EUR 212.5 million, all in spite of the considerable headwind we have been experiencing there due to interest rate increases. We achieved new record results for the region in four countries (Bosnia and Herzegovina, Bulgaria, Poland, and Greece). I am very proud of all my colleagues who have broken new ground and given their all. I would also like to take this opportunity to thank the entire team for their energy and ambition! 

A further highlight in the region is the expansion of the collaboration in Poland with the International Finance Corporation (IFC), a World Bank subsidiary. This success is attributable to the smooth cooperation between five countries and numerous departments at EOS. 

Sebastian Pollmer:
Despite the headwind we have been experiencing in individual countries, the region has had a good year, achieving sales of EUR 323.4 million. France not only celebrated its 30th birthday, but also performed well financially and, together with a co-investor, was able to secure the purchase of a record portfolio with a nominal value of EUR 364 million. Denmark also remains on track with a strong performance in its tenth anniversary year, successfully concluding two large forward-flow agreements with leading consumer credit banks. Portugal is now well established on the market after just two years and continues to sprint toward success.

Stephan Ohlmeyer:
We implemented numerous restructuring measures in Germany during the past financial year, which are now starting to bear fruit. All employees are doing a great job – thank you to everyone! I would particularly like to mention Slovenia, which has performed exceptionally well in a comparatively small market. I am feeling very confident about the future, not least because the new Central Europe region will have numerous positive effects on our cooperation.

Marwin Ramcke:
The uncertain macroeconomic times are set to remain, but we have made handling uncertainty on a professional level our strength, can act with resilience and the required flexibility, and are focused on achieving the best solutions for our customers. We will continue to focus on investments in non-performing loans (NPLs), as they form the basis of our business. Co-investments will also remain part of our strategy.

Our 50th anniversary, which we will celebrate this year, also serves to remind us just how far we have come and how many highlights we have to look back on. Our business stabilizes the economy and promotes growth – and has been doing so since 1974. This is something that we can be proud of. I am very pleased to be celebrating our milestone birthday in this financial year!

Needless to say, we are not resting on our laurels. We thrive on innovation and drive change – this is how we will continue to be successful. 

Justus Hecking-Veltman:
One of our major advantages is that we operate in more than 20 countries, which ensured a regionally diversified portfolio. In terms of asset classes, the risks are also spread across secured receivables, real estate and, in particular, unsecured receivables. Although we do not achieve the same level of success in all areas, our teams have a high level of evaluation expertise and we have been cautious and successful overall in our investment decisions. Therefore, despite the economically and, in particular, politically difficult climate, we can look forward with confidence to this new financial year.

Carsten Tidow:
Activities will be focused on the aforementioned collaboration with the IFC: We will invest jointly in Poland for a minimum period of three years. It is also very important to me to create greater scope for the international exchange of ideas and knowledge and thereby exploit the benefits of our international group. A good example in this context is the expansion of robotic process automation (RPA), which we are working on in several countries. This technology relieves employees of numerous repetitive tasks and increases efficiency and quality in receivables management. 

Stephan Ohlmeyer:
Within the new structure for Central Europe, we will systematically expand business development. Our aim is to create a new level of openness, find new capital partners, and open up new revenue streams. For example, the volume of unsecured NPLs offered is declining in the Central Europe region and, for this reason, we intend to expand investments in secured NPLs. Some countries already have the appropriate know-how, others can benefit from it.

Sebastian Pollmer:
My focus for Western Europe is on digitalization, innovative refinancing concepts, and diversity. A prime example of digital optimization is Kollecto+, the EOS Group’s central web-based collection software, the introduction of which in Spain marked the pinnacle of international cooperation: The project relies on the joint expertise and commitment of our teams in Romania, Spain, Germany, Croatia, and Poland. We want to build on such successes.

Marwin Ramcke:
This is absolutely correct – the fact that we have an international reach not only reduces risks, but also allows best practices to be shared across borders, meaning that we continue to learn from each other and benefit from the diversity within our Group. 

Another factor here is that we act responsibly. This makes us a reliable partner for banks and companies, allowing them to focus on their core business.

But the most important factor is that we have the right people with the right spirit in the right place! Once again, this past financial year has clearly demonstrated to me that, as a team, we at EOS can overcome all challenges. For this, I am truly grateful.