ANNUAL REPORT INTRUM JUSTITIA A N N U A L R EP O R T 2 0 ...

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26 Markets and clients In 2010 only about 10 percent of the credit management services market was outsourced. In other words, the potential exists for us to significantly increase our market share. 90,000 clients in 22 countries – plus growth potential The market for professional credit management services is growing. There are many reasons for this, but in general the market is growing because more and more businesses are discovering the difference between handling the whole credit management process themselves and outsourcing it to a specialist. Despite this trend of credit management that is traditionally handled internally being increasingly outsourced to specialist companies like Intrum Justitia, only about 10 percent of the credit management services market is outsourced. In other words, the potential exists for us to significantly increase our market share. WHY IS THE MARKET fOR PROfESSIONAL CREDIT MANAGEMENT SERVICES GROWING? • Fluctuations in business make it unprofitable to staff up for peak periods. • Specialized and leaner organizations understand that it is more profitable to concentrate on their core business. • Smaller companies cannot afford in-house credit management experts, yet still need such expertise. • New companies that are still feeling their way need the expertise and efficiency they can get from specialists. • Following up on late payments costs European businesses and official bodies an estimated EUR 25 billion a year. • Several industries are deregulating – including financial services, telecommunications, energy and healthcare. Deregulation increases competition and invoice volume, which means that companies need the necessary tools and knowledge to take greater risks and make faster credit decisions. CLIENTS Intrum Justitia has 90,000 clients in 22 European countries. The main industries are telecom, infrastructure (energy and water) and banking and finance. In 2010 Intrum Justitia also experienced good growth in sectors such as telecom, utilities and e-commerce. The 150 biggest clients account for around 40 percent of the company’s revenues. No client stand for more than 2 percent of total revenues. Examples of clients are the Nordic banks Swedbank and Nordea, the Austrian bank BAWAG, Swedish credit card company EnterCard and Hungarian Provident Financial in the Finance sector. In the medical sector we work with Swiss company Ärztekasse that administrates medical clinics and Belgian AZ Jan Portaels. In telecom we have good cooperations with Sunrise in Switzerland, Vodafone in Hungary and Slovak Telekom among others and in the energy sector the Nordic energy company Fortum is a good example. COMPETITORS Intrum Justitia has competitors in all geographical markets and in all parts of the credit management chain. The credit management sector is, however, still very fragmented, which means that there are few competitors with an equally extensive offering and with the same geographical reach as Intrum Justitia. Examples of competitors that operate in several of Intrum Justitias markets are Arvato Inforscore, Cetelem-Effico, Coface, EOS and Lindorff. In the financial services segment Intrum Justitia has competitors such as Aktiv Kapital which focuses mainly on investing in portfolios of receivables. In individual geographical markets there are a number of smaller companies focusing on parts of the credit management chain, such as local collections companies, law firms and accounting firms.
Benefits of credit management Sound business and a more favorable economic climate Adynamic economy would be impossible without credit.Credit is essential for economic growth. Our advice and services help our clients make sound credit decisions and manage their credit portfolios in a professional manner. The result is better business for our clients in the form, for example, of increased sales and better cash flow, less credit loss and improved customer relations, and a more favorable economic climate. SLOW RECOVERY We are currently seeing a slow macroeconomic recovery in Europe, albeit with significant differences between the regions where Intrum Justitia operates. It is easier to solve consumers’ financial problems now compared to at the peak of the global financial crisis in 2009. The effects of the crisis are still being felt in parts of Europe, however, and Intrum Justitia’s business is therefore affected as well. CLEAR NEED fOR BETTER CREDIT MANAGEMENT AND RISK ASSESSMENT Unsustainable levels of household debt in the USA and Europe triggered the global financial crisis. When the crisis spread to the real economy, companies not only found themselves facing a sharp decline in demand, but longer payment times and pressure on cash flow as well. Today many companies are clearly in need of better credit management and risk assessment. Companies are also increasingly aware of the fact that credit management is not their core business and that a professional would be better at handling the entire process – from prospecting customers and making credit decisions to collecting debt. The benefits of professional credit management include faster payments, lower costs, improved cash flow and better control over receivables. Our clients also benefit from having access to the latest expertise in building customer loyalty and identifying and penetrating new markets. Professional credit management ensures that companies avoid wasting time and money on marketing aimed at customers who are not creditworthy. We offer our clients a menu of credit management solutions – from a single credit management service to total credit management outsourcing. ON-TIME PAYMENT – A MATTER Of SURVIVAL In these times of slow recovery, good credit management is even more important because credit environments have deteriorated or are risky in several markets. This applies to all parts of the credit cycle – from prospecting to debt collection. On-time payment is a matter of survival for many small and medium-sized enterprises. For companies providing consumer credit, understanding their customers’ creditworthiness and payment behavior can help reduce their risk and stimulate sales. Intrum Justitia plays an active role in the market and provides expertise and services to both international corporations and small businesses. This helps our clients improve their business and helps build a healthier economy. 27
Page 1 and 2: INTRUM JUSTITIA ANNUAL REPORT
Page 3 and 4: Net earnings amounted to SEK 452 M
Page 5 and 6: We are working to promote healthy p
Page 7 and 8: ity will increase in these countrie
Page 9 and 10: In addition to being present in 22
Page 11 and 12: We are the market-leading credit ma
Page 13 and 14: Our services Respectful credit mana
Page 15 and 16: insight to feed innovation We are a
Page 17 and 18: Payment services Information is imp
Page 19 and 20: Payment guarantee Many of our custo
Page 21 and 22: Committing to challenge We are ofte
Page 23 and 24: Credit institutions, private and pu
Page 25: Our goal is to be the employer of c
Page 29 and 30: Regions Intrum Justitia has operati
Page 31 and 32: No. of shares traded Intrum Justiti
Page 33 and 34: financial overview Income statement
Page 35 and 36: There are several attractive commer
Page 37 and 38: NET fINANCIAL ITEMS The net financi
Page 39 and 40: GOODWILL The Group’s goodwill amo
Page 41 and 42: PROPOSED APPROPRIATION Of PROfIT Th
Page 43 and 44: Consolidated balance sheet SEK M NO
Page 45 and 46: Consolidated cash flow statement SE
Page 47 and 48: Parent Company income statement SEK
Page 49 and 50: Parent Company balance sheet SEK M
Page 51 and 52: Condensed statement of changes in s
Page 53 and 54: NOTE 1 SIGNIfICANT ACCOUNTING AND V
Page 55 and 56: Legal outlays The Group incurs outl
Page 57 and 58: iod of employment of the employees
Page 59 and 60: GROUP Tangible and intangible fixed
Page 61 and 62: GROUP 2010 2009 Reconciliation SEK
Page 63 and 64: NOTE 11 TANGIBLE fIXED ASSETS GROUP
Page 65 and 66: NOTE 13 JOINT VENTURES Intrum Justi
Page 67 and 68: NOTE 21 LIQUID ASSETS GROUP PARENT
Page 69 and 70: ity amounted to SEK 168.7 M (849.7)
Page 71 and 72: SEK Base salary/fee Variable comp-
Page 73 and 74: 2010 PARENT COMPANY SEK M At fair v
Page 75 and 76: Accounts receivable The Group’s a
Page 77 and 78:
Audit Report We have audited the an
Page 79 and 80:
CHARLOTTE STRÖMBERG Age 51 Directo
Page 81 and 82:
PER CHRISTOFFERSON Age 42, Director
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ATTENDANCE AT BOARD MEETINGS IN 201
Page 85 and 86:
The Board of Directors’ report on
Page 87 and 88:
able on the intranet and ongoing em
Page 89 and 90:
Information for shareholderst Annua
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Intrum Justitia’s annual report 2
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ANNUAL REPORT INTRUM JUSTITIA A N N U A L R EP O R T 2 0 ...

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