24 Jul 2023 07:00
Kaspi.kz 2Q & 1H 2023 Financial Results
Almaty, Kazakhstan, 24 July 2023 - JSC Kaspi.kz ("Kaspi.kz", "we", or the "Company") which operates the Kaspi.kz Super App for consumers and Kaspi Pay Super Apps for merchants, today publishes its unaudited consolidated IFRS financial results for the quarter and first half ending 30 June 2023.
2nd quarter 2023 highlights & 2023 guidance upgrade
· Kaspi.kz 2023 consolidated adj. net income growth guidance upgraded to above 30% year-over-year from around 25%
· Kaspi Juma in July up 82% year-over-year to reach GMV of KZT302 billion. Once again, all expectations exceeded
· With a large and engaged consumer and merchant base, transaction intensity continues to increase rapidly:
o Average monthly transactions per active consumer up 19% year-over-year to 66
o RTPV transactions up 39% year-over-year
o GMV purchases up 37% year-over-year
· e-Grocery (1P) continues to see very strong growth momentum:
o e-Grocery GMV up 4.5x, purchases up 4.3x and consumers up 4.1x year-over-year
o 5% and 12% of total of e-Commerce (1P+3P) GMV and purchases
o Net income positive on a stand-alone basis
o Remain focused on Almaty & Astana. Regional expansion still to come
o Plan to invest around KZT20-25 billion per annum over 3 years, on track and unchanged
· e-Commerce (3P) continues to deliver fast and profitable growth:
o Take Rate up 200bps year-over-year due to initial monetization of Kaspi Delivery and Kaspi Advertising
o 4,372 Kaspi Postomats operational in June 2023, up 160% year-over-year, accounting for 35% of orders delivered. Around 6,000 lockers planned by end-2023
· Kaspi B2B Payments continues to prove itself as a transformative payments proposition for merchants and their suppliers:
o B2B RTPV up 2.6x year-over-year
o B2B Payments now 4% of our Payments Platform's total RTPV
· Kaspi.kz delivered strong second quarter 2023 consolidated financials:
o Revenue up 51% and adj. net income up 46% year-over-year
o Based on our second quarter 2023 results, our Board of Directors has proposed a dividend of KZT750/GDR, subject to shareholder approval
o New $100 million GDR repurchase program to be launched
o $222 million GDRs repurchased since April 2022
· First half 2023 financial results and Kaspi Juma in July have all exceeded our expectations. We're on track to deliver a good 2023 and remain upbeat about our mid-term growth prospects. As a result, we are upgrading our full-year 2023 guidance for all platforms:
o Payments Platform RTPV growth upgraded to around 40% from around 35%
o Marketplace GMV growth upgraded to above 40% from around 35%
o Marketplace 3P take-rate upgraded to around 9% from around 8.5%
o Fintech TFV growth upgraded to around 40% from around 35%
o Kaspi.kz consolidated adj. net income growth upgraded to above 30% from around 25%
· Acquisition of 40% stake in Kazakhstan's leading classifieds business, Kolesa Group, from its private equity shareholder:
o Kolesa owns N1 car classifieds in Kazakhstan, N1 real estate classifieds in Kazakhstan and leading car classifieds in Uzbekistan
o Fast growing and highly profitable with no debt. In 1H23, Kolesa's revenue increased 302% year-over-year to KZT27 billion, with net income up 82% to KZT6 billion
o With a 40% stake, Kaspi.kz will have 51% control of voting rights, board control and will fully consolidate Kolesa
o $88.5 million (around KZT39 billion) purchase price for our interest
o Acquisition to be completed in 3Q or 4Q 2023
· We remain committed to ensuring Kaspi.kz is listed on the most appropriate exchange and will update the market at the right time
To the shareholders of Kaspi.kz:
I'm pleased to report that Kaspi.kz has had a very successful first half 2023. Our consumers and merchants are transacting more and more with us, resulting in strong top-line momentum across all our platforms. As you know we've never just been a top-line growth story and our two-sided Super App business model is designed to ensure as much growth and revenue drops through to the bottom-line as possible. Second quarter 2023 adj. net income growth of 46% year-over-year, is an excellent result and ahead of our expectations.
As I mentioned at our first quarter financial results, our focus and N1 priority is to grow transactions between consumers and merchants. You can see that this is happening, with Total GMV and RTPV transactions up 37% and 39% year-over-year respectively and monthly transactions per consumer hitting a record high 66 in the second quarter. Our consumers transact through us more than 2 times per day on average, which is best-in-class by global standards and testament to the relevance of our products to consumers and merchants.
With a large and engaged consumer and merchant base, higher transaction intensity is a function of having a broad and growing suite of top-quality, highly relevant products and services. e-Grocery is a great example of this. During the second quarter of 2023, e-Grocery transactions increased 4.3x year-over-year to over 1 million. As well as growing e-Grocery's top-line, we're laser focussed on ensuring operational efficiency and profitability. In this regard, I'm happy to report that e-Grocery turned net income positive in the second quarter. As we expand in new cities, we will step up investments, however we'll do this with the confidence, that we have a business model capable of delivering scale, profits, and value to our shareholders.
I have previously talked about Kaspi Classifieds, as another area where we can grow. With our acquisition of Kolesa, Kaspi.kz will have market leading positions in autos and real estate classifieds in Kazakhstan. Purchasing a car or home are two of the most important household decisions and Kolesa puts Kaspi.kz at the centre of these transactions. Kolesa is a fast growing, highly profitable business and this transaction is earnings accretive. Combined with our other classifieds, Kaspi.kz now has a portfolio of fast-growing, leading classifieds across Kazakhstan, Azerbaijan and Uzbekistan.
We are acquiring our 40% stake from Kolesa's private equity shareholder. I myself will continue to own 48.42% of Kolesa. However, as part of the transaction, I will transfer 11% to Kaspi.kz, to be held in trust. This will enable Kaspi.kz to have a controlling stake and consolidate Kolesa's financial results. Kolesa and Kaspi.kz share the same values when it comes to building high quality digital products around consumers and sellers everyday needs. I am highly confident that working together, our teams can accelerate the development of new innovative services and here too create significant value for Kaspi.kz's shareholders.
I am also very happy with the results of our initial efforts to monetize Kaspi Advertising and Kaspi Delivery, which together contributed 1.1% to the growth of e-Commerce's take-rate. We will continue to carefully scale these services, making sure that our merchants quite clearly see the growth that comes from investing into delivery and advertising.
With strong first half results and Juma in July delivering GMV growth up 82% year-over-year, I'm delighted that we can now upgrade our full-year 2023 guidance across all our Platforms. The result is that we expect full-year 2023 Kaspi.kz consolidated adj. net income to grow above 30% year-over-year, up from our previous guidance of around 25% growth. All in all, we are on track to deliver a good 2023 and are as upbeat as ever about our mid-term growth prospects.
I always say with every update, our long-term approach to the capital allocation remains unchanged. Investing in our growth, be it organic or via M&A is always the first use for the cash we generate. However, if we have excess capital, we will return it to our shareholders. Here too, the numbers speak for themselves, as we approach a near 3-year track record of returning substantial amounts of capital. Following the second quarter of 2023, our Board of Directors and subject to shareholder approval, has approved a dividend equivalent to KZT750/GDR. Having repurchased $222 million GDRs since April 2022, we are also launching a new up to $100 million buyback program.
Our commitment to ensuring Kaspi.kz is listed on the most appropriate exchange remains unchanged.
Once again, we have proven that our unique two-sided Super Apps business model, the Kaspi.kz Super App for consumers and the Kaspi Pay Super App for merchants, delivers results. Being a fast-growing technology company, profitable, dividend paying, that buys back its own stock and makes high quality, accretive acquisitions to ensure our long-term growth, sets us apart from many leading technology companies around the world.
Kaspi.kz is at the forefront of the new digital revolution, redefined by Super Apps. The combination of our scale with consumers and merchants, reinforced by our Super App strategy, puts us in a completely unique position. With the multi-year structural growth opportunity offered by digitalisation in Kazakhstan and the neighbouring region amongst the most attractive of anywhere globally, we thoroughly intend to capture it.
I am a very happy Kaspi.kz shareholder and proud to be part of our team, which I would like to thank for their incredible execution and dedication to our consumers, merchants and partners. To our long-term shareholders, thank you for your ongoing trust and support.
Mikheil LomtadzeKaspi.kz CEO and co-founder
Kaspi.kz 2nd quarter 2023 Engagement Highlights
RTPV transactions up 39%, Total GMV purchases up 37% YoY & 66 transactions per consumer/month
The Kaspi.kz and Kaspi Pay Super Apps for consumers and merchants give our Payments, Marketplace and Fintech Platforms unrivalled competitive advantages. During the second quarter of 2023, Super App transaction levels once again hit all-time highs.
Increased adoption of our existing products by merchants and consumers, along with a growing range of new products facilitates higher transactions across more areas of household spending and merchant's business activity. Average monthly transactions per active consumer, increased 19% year-over-year to 66, during the second quarter of 2023.
To drive transactions higher, over the last three years we prioritised onboarding as many merchants, as rapidly as possible. In 2023 we still expect strong growth in new merchants, but our focus is to grow the number of transactions between consumers and merchants.
During the second quarter of 2023, RTPV transactions increased 39% year-over-year and Total GMV purchases including e-Grocery increased 37%. Fast growth in transactions illustrates just how relevant our products are to our customers and merchants.
Kaspi Pay and m-Commerce are the basis of our day-to-day relationship with merchants. Going forward, we will grow earlier stage merchant services including e-Commerce, B2B Payments, Kaspi Advertising, Kaspi Delivery and financing for merchants and SMEs. These products all help our merchants invest in their business, reach new customers and increase their sales. They will also ensure we continue to deliver fast top and bottom-line growth. Growing adoption of Kaspi Delivery and Kaspi Advertising is already making a difference to e-Commerce's take-rate. The growth opportunity ahead is substantial and as these initiatives gradually scale, we will of course provide more detail.
P2P, Bill Payments, BNPL, Kaspi QR and GovTech are fundamental to high day-to-day consumer engagement. Going forward, we will grow less mature services including e-Commerce & Kaspi Postomats, Kaspi Travel's full range of products, e-Grocery and Kaspi Classifieds. These services help our consumers discover the products they need, at the best possible prices, from local merchants, with free delivery, saving time and money. With consumer penetration across our full range of Super App services still low, here too the opportunity ahead remains significant.
From start-up in Almaty less than two years ago, we continue growing Kaspi e-Grocery. With an innovative, high-quality digital offering, we believe we can transform the food shopping experience in Kazakhstan. This is a sizeable opportunity and exciting joint project with Magnum, Kazakhstan's leading food retailer. As e-Grocery scales, it will mean higher Super App engagement, faster financial growth and further value creation for our shareholders.
During the second quarter of 2023, e-Grocery purchases increased 4.3x year-over-year and the number of consumers was up 4.1x. With increased scale, e-Grocery turned net income positive, led by our initial dark store operations in Almaty.
We started to roll out Kaspi Postomats in late-2021 and had 4,372 lockers by the end of June 2023, accounting for 35% of e-Commerce deliveries. Postomats increase the share of successful 1st time deliveries, lower the cost of last-mile-delivery and will help us protect Marketplace's long-term profitability. Postomats are also a key part of our plan to make commerce in Kazakhstan more environmentally sustainable. With consumer feedback extremely positive, we continue to plan for around 6,000 Postomats by the end of the year.
Kaspi B2B Payments, which was born out of Bill Payments and P2P, is an example of how we can grow transactions by targeting completely new types of customers, in this case wholesalers, distributors and manufacturers. Number of B2B Payments transactions increased 2.2x year-over-year, during the second quarter of 2023 and with this product still in its early days, we expect B2B Payments to keep growing fast. In the medium- term, B2B Payments can be the start of a long list of innovative B2B services.
As always, we will continue to launch new services and our product pipeline in 2023 and beyond is as exciting as ever.
Kaspi.kz 2Q & 1H 2023 Financial Highlights
Top & bottom-line growth ahead of expectations
Revenue up 51% and adj. net income up 46% YoY in 2Q23
During the second quarter of 2023, total revenue increased 51% year-over-year to KZT448 billion. For the first half of 2023, total revenue increased 52% to KZT853 billion.
Our Payments Platform delivered fast and consistent top-line growth, due to the ongoing success of Kaspi Pay and Kaspi B2B Payments. In Marketplace, m-Commerce, e-Commerce and Kaspi Travel all contributed, albeit with the year-over-year comparison challenging, given a strong rebound in consumer demand in the second quarter of 2022. Kaspi Travel and e-Grocery are additive to Marketplace growth. Faster TFV origination in the second half of 2022, translated into strong Fintech revenue growth in the first half of 2023, even with lower yield year-over-year.
During the second quarter of 2023, adj. net income increased 46% year-over-year to KZT198 billion. For the first half of 2023, adj. net income increased 50% to KZT376 billion.
We continued to benefit from Payments Platform's operational gearing. Marketplace profitability was stable year-over-year, excluding the impact of e-Grocery. In Fintech, the combination of yield reduction and significantly higher funding costs lowered profitability, partially mitigated by tight control of operating costs. Higher funding costs did however help us attract substantial deposit inflows, with average Kaspi Deposit balances up 49% year-over-year in the second quarter of 2023. An enlarged deposit base will allow us to fund higher TFV over the medium-term and with the decline in Fintech profitability cyclical, not structural, as interest rates normalise we expect Fintech profitability to recover.
Our faster growing and more profitable Payments and Marketplace Platforms continued to deliver strong bottom-line growth, accounting for 61% of adj. net income, up from 55% in the first half of 2022. In 2023, we expect the contribution to net income from our Payments and Marketplace Platforms to increase again year-over-year.
Our cash generation capacity remains as strong as ever. As a result, our Board of Directors has proposed, subject to shareholder approval, a second quarter 2023 dividend of KZT750/GDR. In addition, we will commence a new GDR buyback program of up to $100mn. Since April 2022 when we started GDR repurchases, we have bought back GDRs equivalent to $222 million.
Payments Platform
Strong top-line & even faster bottom-line
RTPV up 46%, revenue up 48% and adj. net income up 55% YoY in 2Q23
Our Payments Platform facilitates transactions between and among merchants and consumers. For consumers, Payments Platform is a highly convenient way to pay for shopping transactions, pay regular household bills and make peer-to-peer payments. For merchants, Payments Platform enables them to accept payments online and in-store, issue and instantly settle invoices, pay suppliers and monitor their turnover. Our Payments Platform is our main customer acquisition tool and fundamental to high levels of engagement. We continue adding new opportunities to spend and pay, which is a function of new merchants and product development. Payments Platform proprietary data informs decision making across multiple areas of our business.
We have prioritised growth in Payments Platform merchants over the last three years, our focus now is transaction intensity and during the period, number of Payments Platform revenue generating transactions increased 39% year-over-year. As merchants shift more of their volumes to us, Revenue Generating TPV (RTPV) will keep growing at a fast rate.
With a large and diverse merchant base, consumer growth remained robust. Payments Platform active consumers increased 15% year-over-year, reaching 12.1 million, in the second quarter of 2023.
During the second quarter of 2023, RTPV increased 46% year-over-year to KZT6.7 trillion. RTPV continues growing fast due to growth in Kaspi Pay merchants and transactions, rapid adoption of B2B Payments and the ongoing popularity of Bill Payments. For the first half of 2023, RTPV increased 53% year-over-year to KZT12.5 trillion.
Over the last year, Kaspi B2B Payments has emerged as a fast-growing component of our RTPV. Our B2B Payments proposition connects small merchants with wholesalers, distributors and manufacturers, allowing invoices to be settled instantly and conveniently. During the second quarter of 2023, B2B Payments RTPV increased 2.6x year-over-year to KZT266 billion and now accounts for 4% of RTPV. We expect B2B Payments to continue growing significantly faster than Payments RTPV in 2023.
Average interest free balances increased 20% year-over-year in the second quarter of 2023 to KZT711 billion. This is higher than in the first quarter but with first half 2023 balances up 15%, trends are consistent with our full-year 2023 guidance of around 15% year-over-year growth.
During the second quarter of 2023, Payments Platform revenue increased 48% year-over-year to reach KZT113 billion. Take-rate during the period was stable at 1.2%. For the first half of 2023, Payments Platform revenue increased 53% year-over-year to reach KZT214 billion.
Payments Platform adj. net income increased 55% year-over-year to KZT74 billion. Payments Platform profitability continues to benefit from the elimination of third-party costs, our proprietary payments network's operational gearing and tight cost control. For the first half of 2023, Payments Platform adj. net income increased 62% year-over-year to KZT140 billion.
In 2023 we now expect Payments Platform to deliver RTPV growth of around 40% year-over- year, up from our previous expectation of around 35%. With Payment Platform's inherent operational gearing unchanged, we now expect full-year 2023 adj. net income to grow around 45% year-over-year. This compares with our previous adj. net income margin guidance, which is equivalent to around 40% adj. net income growth.
Looking into the medium-term, existing consumers keep spending more with us and as we add more opportunities to transact, fast growth can be sustained. Kaspi B2B Payments increases our addressable market further. We will stay disciplined on costs, ensuring strong top-line trends, drop through to the bottom-line. As a result, we remain extremely positive about the growth outlook for Payments Platform in 2023 and beyond.
Marketplace Platform
Strong GMV, revenue growth & bottom-line growth
GMV up 39%, revenue up 78% and adj. net income up 52% YoY in 2Q23
Our Marketplace Platform connects both online and offline merchants with consumers, enabling merchants to increase their sales using an omnichannel strategy and consumers to purchase a broad selection of products and services from a wide range of merchants. Other than in e-Grocery, our Marketplace Platform is a "3P" model. We have strategically positioned Marketplace as the champion for Kazakhstan-based brands and local businesses, which provides us with a competitive advantage over international marketplaces that lack relevant assortment and fast delivery, while we also serve as a gateway into Kazakhstan for international brands.
m-Commerce is our mobile solution for shopping in person, while consumers can use e-Commerce to shop anywhere, any time with free delivery. Kaspi Travel allows consumers to book domestic and international flights, rail tickets and overseas package holidays. e-Grocery helps households with their day-to-day shopping needs and following the completion of our acquisition, Kolesa will give Marketplace leadership in classifieds. All combined, we offer a unified digital shopping experience, irrespective of online or offline, relevant across practically all areas of consumer spending.
Just as with our Payments Platform, the expansion of our Marketplace merchant base has been an important focus. Now we're prioritising growth in transactions and during the second quarter of 2023, Marketplace purchases increased 37% year-over-year.
With the attractiveness of Marketplace's consumer proposition continuing to increase, growth in consumers was strong, up 22% year-over-year to 6.6 million in the second quarter of 2023.
Marketplace GMV momentum was fast, up 39% year-over-year with GMV reaching KZT856 billion in the second quarter of 2023. GMV momentum slowed compared with the first quarter of 2023, due to a tough year-over-year comp, as supply chain disruption in the first few months of last year, led to Marketplace having an extremely strong second quarter in 2022. However, with changes in product mix, increased monetization of Kaspi Delivery and Kaspi Advertising, Marketplace take-rate increased significantly to 8.5% from 7.7%. For the first half of 2023, GMV increased 55% to KZT1.6 trillion.
m-Commerce continues to deliver excellent results. During the second quarter of 2023 purchases increased 19% year-over-year. In early 2022 we scaled back promotional activity, but the combination of normal levels of promo and growth in retail trade led to strong ticket-size growth year-over-year. As a result, GMV increased 35% and reached KZT473 billion. Normalised promotional activity resulted in m-Commerce's take-rate increasing to 8.0% from 7.7% over the same period. For the first half of 2023, m-Commerce GMV increased 52% to KZT908 billion.
In the second quarter of 2023, e-Commerce demand was extremely strong with orders up 148% year- over-year. GMV increased 39% year-over-year to KZT286 billion. GMV growth below order growth, reflects the inclusion of fast growing but lower ticket e-Grocery, which we now account for as part of Marketplace 1P e-Commerce and our ongoing efforts to expand the breadth and depth of everyday items at lower price points. During the period, 1P reached 5% and 12% of e-Commerce (1P+3P) GMV and purchases, respectively. For the first half of 2023, e-Commerce GMV increased 58% to KZT549 billion.
e-Commerce's take-rate increased significantly to 11% from 9.0% during the second quarter of 2022. The main drivers of this were changes in product mix, increased monetization of Kaspi Delivery and to a lesser extent revenue from Kaspi Advertising.
Kaspi Travel's GMV increased 54% year-over-year to KZT96 billion during the second quarter of 2023, with ticket sales up 33% to 4.1 million. Over the same period, take-rate increased by 40bps year- over-year to 4.2%, due to the growing share of higher take-rate rail bookings. Travel's GMV now accounts for 11% of Marketplace GMV. For the remainder of this year Travel's fast growth should be additive to Marketplace GMV growth and we have just added international package holidays, which will become more meaningful next year. The addition of package holidays is expected to be take- rate enhancing. For the first half of 2023, Travel's GMV increased 65% to KZT164 billion.
With Marketplace take-rate up year-over-year and e-Grocery growing fast, revenue grew significantly faster than GMV and was up 78% year-over-year to KZT86 billion. Take- rate will vary from quarter-to-quarter due to the timing of promotional events but for the remainder of the year increased monetization of Kaspi Delivery and Kaspi Advertising will contribute positively and offset take-rate dilution from Kaspi Travel. For the first half of 2023, Marketplace revenue increased 95% year-over-year to KZT 158 billion.
During the second quarter of 2023, Marketplace Platform adj. net income reached KZT47 billion, representing a 52% increase year-over-year. Net income profitability growth below revenue growth, reflects the inclusion of e-Grocery. However, the underlying profitability of Marketplace was broadly stable year-over-year and during the second quarter, e-Grocery turned net income positive on a stand-alone-basis. For the first half of 2023, Marketplace Platform adj. net income increased 74% to KZT87 billion.
In 2023 we now expect Marketplace Platform to deliver GMV growth of above 40% year- over-year, up from around 35% previously. Around 200bps of this increase comes from the inclusion of e-Grocery, with the majority due to strong momentum across e-Commerce, m-Commerce and Travel and the success of Kaspi Juma. Take- rate is now expected to increase year-over-year to around 9%, above our previous around 8.5% guidance. This reflects faster growth from high take-rate e-Commerce and the success of Kaspi Juma in July, which we plan to repeat in November. Adj. net income is now expected to grow above 45% year-over-year, including the impact of e-Grocery, above our previous adj. net income margin guidance, which is equivalent to around 40% adj. net income growth.
Looking into the medium-term, enhanced shopping categories and services lead to more transactions per consumer and help us attract new consumers. Having substantially grown our Marketplace merchant base over the last two years, our focus is now on helping existing merchants sell more. Earlier-stage initiatives like Kaspi Advertising, Kaspi Delivery and SME financing are a big part of this and combined with rapid growth from e-Grocery and classifieds should ensure strong growth from Marketplace Platform in 2023 and beyond.
Fintech Platform
TFV origination growing fast YoY, healthy CoR trends & strong deposit base growth
TFV up 48% & deposits up 49% YoY and 2% credit CoR in 2Q23
Our Fintech Platform provides consumers with BNPL, finance and savings products, and merchants with merchant finance services.
In the first half of last year, we took a cautious approach to Total Finance Value (TFV) origination. In the first half of 2023, TFV origination is running at normalised levels but 2023 year-over-year growth is expected to be first half weighted. During the second quarter and first half of 2023, TFV increased 48% and 60% year-over-year, to reach KZT1.7 trillion and KZT3.3 trillion respectively. We finished the quarter with 5.9 million loan consumers, up 13% year-over-year.
Low risk, small ticket, short duration Buy-Now-Pay-Later (BNPL) loans accounted for 42% of TFV in the second quarter of 2023, making them our most important Fintech Platform product. With Kaspi Juma taking place in both the third and fourth quarters, we expect the share of BNPL to step up again in the second half of the year. Our Merchant Finance products are our fastest growing lending product and accounted for 16% of TFV in the second quarter of 2023, up from 8% in the same period last year. We expect lending to merchants to continue growing at a considerably faster rate than TFV in 2023.
Our average net loan portfolio increased by 37% year-over-year, to KZT3.3 trillion during the second quarter of 2023. Our deposit base has seen substantial growth since the second half of last year and in the second quarter of 2023, average savings increased by 49% year-over-year to KZT4.3 trillion. Deposit consumers increased 32% to 4.3 million. Following strong growth in deposit consumers and deposit inflows, our loan to deposit ratio fell to 74% in the second quarter of 2023, from 80% in same period in 2022.
During 2022 we raised Kaspi Deposit rates and higher funding costs are resulting in lower near-term Fintech profitability. However, more deposit consumers and an enlarged funding base, will enable us to drive faster origination and more transactions over the medium-term. Hence, we expect our loan to deposit ratio to gradually move up again.
Portfolio conversion of 2.2x in the second quarter of 2023, is in line with trends over the last year, reflecting ongoing high early repayments levels and is indicative of financially healthy consumers borrowing, transacting and repaying quickly. With no deterioration in consumer credit quality, we expect to continue benefiting from rapid portfolio conversion throughout 2023.
Fintech yield was 26.2% during the second quarter of 2023, reflecting the growing share of lower yielding BNPL and Merchant Finance loans and consistent with our full-year 2023 guidance of around 25%.
During the second quarter of 2023, our underlying credit cost of risk was 2.0%, with credit quality strong and consistent with trends seen over the last year. Low credit cost of risk in part reflects the low-risk nature of our products, especially BNPL. Our NPL ratio of 6.1%, down from 6.3% at the end of 2022 reflects the normal seasonality we have described previously and is expected to remain around current levels for the remainder of the year.
Fintech Platform revenue increased by 45% year-over-year to reach KZT249 billion, during the second quarter of 2023. Fintech revenue growth is benefitting from higher origination over the last six to nine months, slightly offset by lower yielding BNPL. For the first half of 2023, Fintech revenue increased by 40% to KZT480 billion.
In the second quarter of 2023, Fintech Platform's adj. net income increased by 36% year-over-year to reach net income of KZT77 billion. Adj. net income growth below revenue growth, mainly resulted from higher year- over-year funding costs, with interest expense up 75% year-over-year. However, higher funding costs were partially offset by lower sales and marketing costs, which declined by 15% year-over-year. When interest rates normalise, we'd expect newly acquired customers to stay with us, resulting in Fintech margins recovering. For the first half of 2023, Fintech adj. net income increased by 31% year- over- year to reach net income of KZT148 billion.
We expect TFV year-over-year growth to remain fast during the second half of 2023 and for the full-year to grow around 40% year-over-year, which is above our previous around 35% expectation. Although we will continue to prioritise our BNPL product, we also expect Kaspi Business merchant and SME financing products to keep scaling rapidly. BNPL integrated with Kaspi Travel is also expected to see strong growth, especially as package holidays gather momentum. Changing product mix is reflected in our unchanged yield guidance of around 25%. With consumer credit quality high, portfolio conversion and cost of risk trends are expected to be broadly similar to 2022. Fintech adj.net income growth guidance of around 15% year-over-year, reflects the near-term impact of higher funding costs but is higher than our previous adj. net income margin guidance, which is equivalent to around 10% adj. net income growth.
Looking beyond 2023, our Fintech Platform remains extremely well positioned, as evidenced by ongoing growth in loan and deposit customers, as well as deposit inflows. Structural top-line growth will be driven by BNPL as well as merchant and SME financing, which is underpenetrated in Kazakhstan. Bottom-line growth will benefit through-the-cycle, from normalising funding costs and we will continually improve our risk management capabilities, which all combined points to a robust top and bottom-line mid-term outlook for Fintech.
Guidance for full-year 2023
First half 2023 financial results and Juma in July have all exceeded our expectations. As a result, we are upgrading our full-year 2023 RTPV, GMV and TFV guidance for our Payments, Marketplace and Fintech Platforms.
We are also upgrading take-rate guidance for Marketplace, due to the increased monetization of Kaspi Delivery, Kaspi Advertising and the success of Juma.
The inclusion of e-Grocery in Marketplace adds approximately 200bps to our full-year 2023 GMV growth.
We now expect full-year 2023 Kaspi.kz consolidated adj. net income to grow above 30% year-over-year, which is higher than our previous guidance of around 25%.
As our business becomes increasingly diverse, with various products at different stages of their development changing profitability trends are less indicative of underlying performance and more the result of evolving business mix. As a result, we will now provide platform year-over-year adj. net income growth guidance, instead of adj. net income profitability guidance. However, in our first half 2023 financial results update, for full transparency we have provided our original and upgraded 2023 guidance in both formats.
Our full-year 2023 guidance does not include any contribution from Kolesa Group.
Acquisition of Kolesa Group
We have entered into an agreement to acquire 39.76% of Kolesa Group, from an indirect subsidiary of Baring Vostok Private Equity Fund V.
Kolesa owns Kazakhstan's leading car and real estate online classifieds, Kolesa.kz and Krisha.kz. In addition, Kolesa also owns Avtoelon.uz, the leading online car classifieds in Uzbekistan. Just like Kaspi.kz, Kolesa.kz and Krisha.kz have no.1 brand recognition.
Purchasing a car or home are two of the most important household financial decisions and combined with Kolesa, Kaspi.kz will become even more relevant to our consumers. We will integrate our Payments and Fintech Platforms products and with more data and user insights, we can rapidly develop new products and services together.
Autoelon.uz is not only the leading auto classifieds in Uzbekistan's but takes Kaspi.kz into Uzbekistan. Uzbekistan is a large, fast-growing and rapidly changing country. With an on the ground presence, we will be better positioned to understand consumers' and merchants' digital needs and develop the right products and services, when we believe the time is right.
Combined with our classifieds in Azerbaijan, Kaspi.kz now has a portfolio of leading, fast growing classifieds across three countries.
Kolesa is fast growing and highly profitable. In the first half of 2023, Kolesa's revenue increased 302% year-over-year to KZT27 billion, with net income up 82% to KZT 6 billion.
The purchase price for our stake is $88.5 million (around KZT39 billion) and will be paid in cash. Kolesa is debt free. We estimate the transaction, will be earnings enhancing in the near-term.
Mikheil Lomtadze will remain Kolesa's largest shareholder, but as part of this transaction, will transfer 11% of his shares in Kolesa to Kaspi.kz, to be held in trust. This will enable Kaspi.kz to hold around 51% voting rights, have board control and fully-consolidate Kolesa in its financial statements.
The transaction is expected to close in either the third or fourth quarter of 2023, subject to customary procedures. Kaspi.kz's 2023 financial guidance does not include any contribution from Kolesa Group.
GDR buyback program
In April 2023 we announced the commencement of a 4-month GDR repurchase program, which has subsequently been concluded, with 531,995 GDRs repurchased, equivalent to $42 million. Since our initial GDR repurchases commenced in April 2022, we have repurchased GDRs equivalent to $222 million.
Our Board of Directors has subsequently approved a new up to $100 million.
Total GDR's outstanding as at 30 June 2023 were 189,912,828.
Potential alternative listing
We continue to take steps to enlarge and diversify our shareholder base, as well as improve stock trading liquidity. As part of this, our commitment to ensuring Kaspi.kz is listed on the most appropriate exchange remains unchanged.
Conference call invitation
On Monday, 24 Jul 2023 the management will hold a conference call and webcast at 1.00pm (London) (8.00am U.S. Eastern Time, 6.00pm Astana time) to review and discuss the company's results for the quarter ending June 30 2023.
To pre-register for this call, please go to the following link:
https://www.netroadshow.com/events/login?show=34dc8b8f&confId=52917
You will receive your access details via email.
Kaspi.kz Platform Income Statements
Kaspi.kz Consolidated Financial Statements
About Kaspi.kz
Kaspi.kz's mission is to improve people's lives by developing innovative mobile products and services. To deliver upon this we operate a unique two-sided Super App model - Kaspi.kz Super App for consumers and Kaspi Pay Super App for merchants.
The Kaspi.kz Super App is Kazakhstan's most popular mobile app, with 13.2 million MAU in 2Q 2023, 8.6 million of whom access our services daily. The Kaspi Pay Super App is the digital partner of choice for businesses and entrepreneurs in Kazakhstan, with 529K merchant partners in 2Q 2023.
Through these Super Apps consumers and merchants can access our leading Payments, Marketplace, and Fintech Platforms. All our services are designed to be highly relevant to users' everyday needs and enable consumers and merchants to connect and transact, using our proprietary payments network.
In partnership with Magnum, Kazakhstan's largest food retailer, we have launched e-Grocery. Together we are digitalising food retail, with the aim of creating a dramatically better shopping experience. Consumers access e-Grocery using the Kaspi.kz Super App, can choose from a wide selection of products, at competitive prices, with free same-day delivery.
The combination of a large, highly engaged consumer and merchant base, best-in-class, highly relevant digital products and a capex lite approach, results in strong top-line growth, a profitable business model and enables us to continue innovating, delighting our users and fulfilling our mission.
Kaspi.kz has been listed on the London Stock Exchange since 2020.
For further information david.ferguson@kaspi.kz +44 7427 751 275