KSPI

Thanks, Sammy. Good morning. Good afternoon, everyone. I'm David Ferguson from Kaspi.kz. Welcome to our second quarter and first half 2026 financial results call. With me is Kaspi.kz's CEO and co-founder, Mikheil Lomtadze, and our deputy CEOs, Tengiz Mosidze and Yuri Didenko. As usual, Mikheil will take you through the financial and strategic highlights from the second quarter. I'll talk through the broader financials, and then we'll open the call up to Q&A. On that note, over to you, Mikheil.

Thank you, David. Thank you for everyone joining this call. Our financial performance for the second quarter is strong. The revenue went up 15%, adjusted EBITDA 5%. Considering the performance and the strong financial position of the company, the board is recommending to increase the dividends by 18% compared to the first Q dividend. Our core businesses continue to perform. The marketplace GMV plus 15% driven by the e-commerce, which is our strategic most important focus both in Kazakhstan and Türkiye. It's 28% growth on the constant currency basis. TPV, our major business in the payment, still continues to grow very nicely, around 13% growth quarter-on-quarter. Average net loan portfolio continues to grow strongly around 18% year-over-year. E-commerce is the area which we believe is extremely important for us.

That's the final destination for our consumers and merchants, is where we can add the most of the value in terms of enabling the purchases and connecting merchants and sellers. E-commerce GMV has grown nicely around 28% on the constant currency basis year-over-year. The take rate continues to expand. The main driver of the take rate is the value added services, which we continue scaling, and that's about delivery and advertising. What is important is how engaged the consumers remain and how frequently they transact with us. The number of purchases per consumer continue to grow in both Türkiye and Kazakhstan, and the e-com purchases grew 33%, which is a very nice growth, and we delivered in excess of 76 million purchases in the second quarter.

About 20% of our GMV is a 1P, that is 1P, mainly the e-grocery in Kazakhstan, which is the fastest growing e-commerce vertical for us, and the 1P in Türkiye, which is electronics, and historically has been a category for 1P in Türkiye. We are about 53% of our GMV in Kazakhstan and 47% in Türkiye. Again, both for us, the important priority is just continue building up our e-commerce capabilities and making sure that the delivery quality and the speed is improving. The value-added services are monetized, and we just continue working on converting the traffic and the properties that we have into the purchases from our consumers. Connecting merchants and consumers to each other successfully. E-commerce has been growing the take rate with the value added services.

As you can see, the value-added services grew 49% on a constant currency growth and 27% real growth. Growing faster on the constant currency basis than e-commerce revenue. Again, just to reinforce the fact that we are extremely responsible in terms of growing those additional sorts of services and making sure that we deliver the value for the merchants and also, we make sure that our services are highly reliable on the delivery side and highly relevant on the advertising side. If we sort of promote something to our consumers that actually is something they really need, and we deliver value to both merchants and the consumers through this experience. We're also approaching this new stage of our company's development. As you know, Kaspi.kz has done a sort of reinventions of itself or transformations multiple times during its history.

We've started from financial services, then we expanded into the ecosystem of everyday services, and then we united all these everyday services in a single Super App. Now we're approaching the stage when we want to develop the personal AI assistant, which will help with everyday tasks to our consumers and to our merchants. On the 1st of July, we launched Kasper, which is the assistant for our consumers. We started with the one task now, which is actually enabling shopping. Kasper actually is built on our technology and is built on our data and built on our consumer experience, and it's in a single mobile application, so it's actually integrated in our Super App. Kasper, we call him Kasper, our new personal assistant.

He can actually understand your needs, he can recommend the best products, he can engage in a conversation with you and ask the clarifying questions, compare different products, give you the reviews, and so on and so forth. It's enabled in voice and texts, so you can actually either type your task or you can record it by voice, and then Kasper helps you to find the right product for you among 20 million products in our Kazakhstan e-commerce platform. He can follow up with the smart questions, and then he can lead you to the right product for you, which you can after complete in our e-commerce. We have launched it in the 1st of July. We have been scaling during the month. Now it's available to everyone, to all our consumers in Kazakhstan. Has been very rapid sort of scaling.

It's still early to give you any sort of detailed performance metrics, but I think the metrics we already have are quite encouraging. One out of five customers whom Kasper was available actually used it. Response rate is around three seconds; this just tells you that all the sort of investments we have done both in the compute but also in optimizing the speed have played off really nicely. You as a consumer get response really quickly, which is extremely important for any AI model and assistant. The consumers are looking for the products across pretty much the entire catalog. 22 product categories have been covered so far, which is pretty much our entire catalog, which just tells you that the Kasper is performing the tasks across a wide range of the products that we have.

8 in 10 conversations, 80% of conversations actually end up with a product recommendation, 60% of those take customer through the specific product. If you are looking for vacuum cleaner, he will just guide you through the process, understand your needs, you basically have your product in the shopping cart. What is important is obviously the speed. With the Kasper is 50% faster than just a regular product discovery, 50% faster adding to favorites, 30% faster to the basket. Again, what we believe is that this sort of technology or this customer experience is leapfrogging all the traditional way of you to finding the products. You are scrolling, you are reading, you are analyzing the information on the screen, you are tapping buttons, and so on and so forth.

You are spending much more time going through multiple stages of the product discovery and understanding the product that you need yourself. Kasper is actually speeding up this process. Kasper is helping to find the products faster, he's really is working on the task with you, rather than you sort of typing in the search box name of the product. Highly relevant, highly reliable, faster, those are the most important metrics for us at the moment. Our goal is to build the trusted assistant. Assistant is equal trust, which means that if you don't trust your assistant, you can easily fire him.

We treat Kasper like your personal assistant, our priority now is to build the trust, which means highly reliable, highly relevant service that actually helps you to buy a product, which is exactly the product that you need. This is our priority as we're scaling Kasper. It's just one month, those are really very encouraging metrics that we observe with the Kasper interaction of consumers with Kasper. This is just an example of the queries, which basically tell you how different it is interacting with the Kasper, actually the traditional search or traditional way to find the products.

You usually type the product that you have in mind, traditional e-commerce or marketplace way to offer you a product is you are trying to give you a selection of the products, which you then are reading through, familiarizing yourself with the ratings, also narrowing down through filters and other navigation tools which have been developed over time. When customers are interacting with the Kasper now, they just give him a task. "I want to give my goddaughter a gift for her second birthday." "I want to have aftershave for consistency and effect that has a strong smell." "I want a sprayer that I can set up next to the house, it creates a cool mist." This type of interaction and the type of tasks which Kasper is getting and able to solve is really remarkable.

We're true sort of believers in this technology, which we have been developing already for quite some time behind the scenes and getting ready to scale it. It's really remarkable how consumers interact, how Kasper really helps. Those examples which you see here, they actually ended up in a real order. It's really important when you sort of think how customers do mission shopping, how they're focused on delivery, when give me the items which can be delivered within three hours. Solve this type of problem, which I have, like after double-sided tape, adhesive was left on the plastic window, what product will help to remove it? This is not the regular search. This is you asking someone to help with an advice. All those things are extremely encouraging for us. We're scaling Kasper as we speak in our e-commerce platform.

Again, our mission is to develop a personal assistant for everyday tasks, e-commerce and shopping is just the one task we're now focused on. In the future, we believe that Kaspi.kz can help with all other tasks across all our services in our Kaspi.kz Super App. Now I just would like to give you a bit of a demo. Some of you that actually watch the screen, I think it will be pretty cool. David, can we go to the demo? Kaspi.kz actually has a dedicated space in our e-commerce. You can basically type the task which you want Kaspi.kz to perform. For example, I need a vacuum cleaner. Kaspi.kz does basic analysis. He starts asking you clarifying questions. For example, what type of vacuum cleaner suits you best? He goes into the requirements.

One of the things which is important for any vacuum cleaner is size of your apartment. He will ask you to clarify size of your apartment. He will ask you the budget. What's your budget within which you want to buy the vacuum cleaner? In basically couple of seconds, he pulls together for you different vacuum cleaners which are available in Kaspi.kz Shop. They're described in a simple language. He gives you a list of the vacuum cleaners, which are acceptable for you. You can ask him to compare specific models. He runs comparison. On one screen, you can see the main characteristics. You can compare the products. You can actually use your voice. You can give him task with your voice. This task can be actually something which is really cool.

For example, in terms of added value, like which of these vacuum cleaners is best suited for a person with allergies? He gives you a selection of the products which fit this criteria explains why. If you see some technical term, you can ask him. For example, he's telling you that HEPA filter is important. You can ask him what is HEPA filter. He can tell you in a simple language what is HEPA filter. You select the vacuum cleaner you want, you push the button. That's it. You can continue through the checkout and actually buying the product. All the charts obviously stored, personalized and things like that. You can go back and forth. It's really very interesting. It's important development for us.

As I've said, we are starting from the shopping experience because that's where we can add most of the value. Over time, we plan Kaspi.kz to expand in all our services in our super apps. Also the service is highly scalable, and when it's built on the high-quality data, can become highly relevant. Obviously, the Kaspi.kz is highly scalable to all our other markets, and the businesses. We'll be thinking about scaling him to Turkey as well. Another just a quick update. We have secured the banking license, so we've basically completed the acquisition of Rabobank A.Ş., and now we're building up our fintech capabilities. We will be investing around $300 million, as we initially said, just for the capital of the bank. We're scaling fintech products now, and we're building up the capabilities to roll them out next year.

We expect no material impact this year. Obviously, this is fintech and financial services is where we started. We're true believers that you can deliver the most value to your consumers and to your merchants when you actually combine capabilities of the fintech and the e-commerce together. That's something which is important strategically for us. This is something which we're extremely experienced and successful and we'll be rolling them out next year, the fintech products, both for consumers and merchants. We're not sitting idle, obviously. We have been working on launching the new shopping loan based on the consumer finance license which we already have in Turkey. We've launched the new shopping loan on Hepsiburada. Basically, flow is extremely similar to what you actually have in Kaspi.kz itself.

You can actually select the products, and based on the product, you can select the monthly payment which fits best of your needs, and then you can proceed seamlessly through the checkout. This product we're piloting, and the new shopping loan is already 0.4% of the GMV in June. Again, we have been preparing ourself for quite some time. In any financial services, originating loan or financing customer is step 1. Actually, being paid back, it's more important than originating the loan. For all these months, we have been building up our risk management capabilities, rolling out risk management, which consists of the approval, managing the consumer, and also the collection process, like the entire loan journey. We have been implementing and rolling out now. Now we're comfortable with all the metrics, and we're piloting the new cash loan Basically on the Hepsiburada platform.

Again, we're strong believers that combining this around the consumers' and merchants' shopping experience and the fintech experience and the financial products will create a lot of value for consumers and merchants, and therefore a lot of value for the company. The products which we'll be focused on to roll out as we build the foundation for them will be products around shopping, around merchants, and you know all the products that Kaspi.kz has, right? We have shopping loan, BNPL, merchant finance, and the consumer finance product. Obviously, savings accounts and so on and so forth. You can expect us that next year we'll be launching those products in Turkey. Banking license allows us to do that. Technology, we're rolling out in Turkey, encourages and risk management, basically, all those things coming together very nicely.

We're very optimistic about launching financial services and fintech products in Türkiye. Back to you, David.

All right. Thank you, Mikheil. Just to run through the financials, starting firstly with marketplace. Marketplace constant currency GMV growth up 15% year-on-year. As you saw, that's driven by e-commerce, GMV growth up 28%, with m-commerce and travel broadly flat, consistent with trends in the first quarter. Take rate increase 110 basis points to 12.1%, again, driven by e-commerce and specifically advertising and delivery. The revenue and EBITDA growth of 11% and 9%, that is reported growth, not constant currency, impacted by 21% depreciation of the Turkish lira versus the Kazakh tenge. That's the first thing to keep in mind. The second thing to keep in mind, 9% EBITDA growth, that differential versus revenue growth of that margin pressure, that's sort of the least pronounced we've seen actually for the last couple of years and despite the investments that we're making into Hepsiburada.

Moving on to payments. TPV growth up 13%. That's a slight moderation, reflecting a slight moderation in inflation. As inflation continues to come down, TPV growth will reduce accordingly. The take rate declines by seven basis points. Again, that is something similar to what we saw in the first quarter. Longer run trend, though, driven by changes in product mix in favor of Kaspi Pay. The result is reported revenue growth up 5% and EBITDA down 1%. The pressure on EBITDA is two things. Number one, it's the investment in Kaspi Alaqan, that's pay by palm. It's tech and product development spend. Number two, you should keep in mind the adjusted EBITDA excludes the interest revenue that payments generate. That interest revenue is up 15% year-on-year. That's not reflected in EBITDA but is reflected in net income, is net income accretive.

Then on to fintech. Firstly, we talked on our last call about strategically focusing on loans that generate more revenue. These are longer duration loans. What that really means is within the loan portfolio, the mix is shifting. BNPL, short duration, low revenue generating loan is getting smaller in the mix. Other loans, general purpose, merchant financing are growing in share with the mix. You're seeing decent loan portfolio growth up 18%, the mix changing in favor of higher revenue generating loans. Pricing is stable, the result is faster revenue growth, revenue growth above net loan portfolio growth and revenue growth up 23% year-on-year. That's the first point. The second point would be that you see that cost of funding remains an issue, up 150 basis points year-on-year in the second quarter.

As some of you will have seen, Kazakhstan lowered its National Bank rate at the end of June, and we lowered on one of our products our deposit rate last week, effective last Wednesday, I believe. That was our first rate cut for over two years. It applies to our three-month duration product, which is around 30% of deposits. We lowered the rate from 20% to 19%. Clearly this isn't reflected in Q2 numbers. Some of it will be reflected in Q3. It's a three-month duration product, so it'll be reflected to a much greater extent in the 4th quarter and then fully as we go into next year. The bigger point to keep in mind is this isn't just about one rate cut.

For the last several years on this call, we've been talking about how high rates have been a pressure on the bottom line. If inflation continues to fall in Kazakhstan, rates will continue to come down. You can see that growth in our deposits is strong, up 21%. Naturally, we will be able to pass those rate cuts through, and that will be very beneficial at the bottom line for us over actually not just one quarter, but potentially over the next couple of years. In the second quarter, EBITDA up 6%, though, versus the revenue growth of 23%. On the risk side of things, cost of risk, 0.7%. That's up slightly versus 0.6% in the second quarter of last year, but flat quarter-on-quarter. We would expect cost of risk to moderate slightly in the second half of the year.

The NPL ratio, NPL coverage trends consistent with what we've talked about previously, as the portfolio mix shifts, particularly towards merchant financing and to a lesser extent, the car loan. These are products with a higher probability of collection; therefore, we keep those NPLs on the balance sheet for longer. A higher probability of collection means they require less coverage. This remains just a function of changing mix. If you look at the real-time credit metrics, you see whether it be first, second payment default on the left, or delinquency rates on the right, they remain low and stable. To wrap everything up for the second quarter, reported revenue up 15%, driven by e-commerce and fintech revenue growth. Adjusted EBITDA up 5%, impacted by higher rates and investments into Turkiye. Net income, flat.

Again, reflecting those same pressures on EBITDA. You should also keep in mind that the regulatory changes that were announced last year, particularly higher National Bank reserve requirements, have been introduced in two phases. The first phase was last year, the second kick-up was in the second quarter of this year. You see that pressuring net income. As we go into next year, that is in the base as well. Just another way of cutting things up. I think this just very clearly illustrates where the pressure on profitability is coming from. It's coming from interest rates. We've always said that is cyclical. It now looks we're at the start of the cycle, that going from being a negative, from being a headwind, to being a tailwind. If you think about the investments that we're making into Hepsi.

These things, tech and product spend, sales and marketing, they're not just Türkiye, they're Kazakhstan as well. Actually, you can see that in the context of Kaspi.kz, its earnings generation there, relatively small. That's whether you cut it from an earnings perspective or if you look at it from a dividend perspective, the cash that we're able to return despite these factors and despite these investments. On the guidance. Guidance reiterated. GMV up 17% as of the first half of the year. Guidance for the full year remains around 20%. We would expect faster trends in the second half versus the second quarter, driven by the timing of promotional events and other product initiatives. TPV growth up 13% versus the guidance of around 15%.

There will be, assuming inflation moderates, that will be a downward pressure, although integration with Apple Pay should see us benefit from higher overseas volumes, particularly over the summer period. As we talked about, we've moved from TFE guidance to average net loan portfolio guidance, 20% in the first half of the year, guiding for 15% for the full year. EBITDA is trending up 7% at this stage in the year versus the guidance of around 15%. Overall, we're comfortably on track for where we expected to be at this point in the year. On that note, Sammy, let's open the call up please to Q&A.

Thank you very much. If you'd like to ask a question and you've joined the call via Zoom, please do press the raise hand icon on your screen. If you joined the call via phone, please press star followed by one on your telephone keypad. Our first question comes from Gabor Kemeny. Your line is open. Please go ahead.

Hello. Thank you for the presentation. Can I first ask about the fintech business, please? Indeed, a decline in your deposit pricing for the first time. I think you cut your deposit rates around two months after the central bank policy rate cut. Is this reflective of how you expect your pricing to evolve in light of the central bank policy rates, and can you share your thoughts on how your deposit pricing may evolve in the next few quarters? My other question would be just on a combination of this very quick deposit growth in the quarter, coupled with a drop in your deposit pricing. If you can elaborate a bit further on these trends, please, which clearly left you in a better funding position than you have been for some time. My final question would be on the marketplace dynamics.

It looks like Kazakhstan was growing more quickly this time than Turkey. Can you shed some light on how these respective markets are evolving? Thank you.

Mikheil, do you want to take actually all of those questions?

Yeah, sure. Hi, Gabor. Thank you for your questions. In terms of the deposit rates, in general, we're really focused always on acquiring the customers and delivering them the best product and experience. The previous actions which we really had resulted in a very strong customer and deposit inflow. In terms of our strategy for the pricing in the future, our general strategy really will remain the same. We just look at the dynamics, and if we believe that there is a relationship really strong, considering the market dynamics and the rates on the market, relationship between the way that we price our products and how we acquire customers. If we believe that there is a room to reduce the interest rate because these dynamics on the changing rates on the market allow us to do, then we will do it.

There is no magical formula basically behind it. Our decision to reduce the rate was driven by basically these dynamics. What you could expect is that it's this specific product, which is the three-month savings account, around 30% of our deposit base. You expect the positive impact financially by the end of the year, as deposits churn. The duration again of deposits is three months. All the deposits will be repriced when the duration is finished, so basically in three months. In terms of the marketplace dynamics, again, we have a bit different strategies on the market. Our e-commerce is a priority, but in Kazakhstan, what we're doing is we're just developing a consumer experience based on the specific verticals. That's what gives us the successful growth on the e-commerce side.

We are also growing extremely fast on the e-grocery side, which is also helping both with the consumer engagement, but also profitability on the marketplace, but most important, the growth. In Kazakhstan, our strategy is just we're working vertical by vertical. Again, the electronics has not really recovered, just because of all the price changes and the conflict of the Middle East and things like that. Supply chain just too challenging, GPU prices and chip prices going up. You still see the growth because all other verticals are growing very nicely. Everything around clothing or car spare parts or home items and things like that. We're really happy with the way we're proceeding in Kazakhstan, and the strategy there is go vertical by vertical.

In Turkey, our strategy, considering that we're just starting to actually launch the products for the consumers, especially on the fintech side, for us, it's extremely important to work on foundational things. Even though growth has been there, our focus has not been on the growth, right? Our focus really has been on the consumers. Consumer experience, net promoter score, merchant experience, delivery speed, which we have improved dramatically during the last 12 months year-over-year. Like consumer frequency of transactions increased 15% in Turkey. All those things. Basically, the strategy there, to put it in simple words, it's much better to have 1 million customers which love you rather than 3 million or 5 million customers which have just occasional shopping with you.

The reason why we want this 1 million customers to love us is because next products which we will launch, they will use those products if they are in love with our existing consumer experience. In Turkey, the growth has not been the goal. We have grown nicely. Our goal is to make customers even happier and the merchants even happier. We're building the foundation for the phase of the growth coming next year. We just want to drive the adoption of the new products which we'll launch next year, especially on the fintech side.

Maybe I'll just add one-

I'll just add one, Gabor, on Turkey. When you're looking at its performance in the second quarter, I think you should look actually at order growth over the first half, because you probably remember there was a lot of retail disruption in Turkey in the first half, March, April of last year. That just sort of distort the comp quarter-on-quarter, both in Q1 and Q2. Probably if you look over a longer period of time, H1, where orders increased just under 18%, you get a bit better indication of the performance of the business this year.

Got it. Thank you.

Our next question comes from Maksim Nekrasov. Your line is open. Please go ahead.

Hello. Thank you for the presentation. I have a couple of questions. The first one is very simple. Basically, your first half EBITDA growth was around 7%, and was already trending above the full year guidance. While you mentioned the reduction in the deposit rates that should benefit you in the second half of the year. Simply why EBITDA guidance was unchanged, and how should we think about the second half growth and profitability? The second topic I wanted to ask about, maybe not surprisingly about AI, and the Kasper. I know it's quite early, but maybe if you can tell us about the early benefits you've been seeing so far or any measurable impact. Also, in terms of the costs and what level of investment, should we expect any significant costs related to that project? Yeah. Thank you.

Thanks, Maksim. Maybe I'll take the first question on the guidance, and then Mikheil can take the AI related question. You are right, we lowered the rate on the three-month deposit. That's around 30% of the deposit base last week, last Wednesday. It will take three months to fully reprice that. You're looking at the benefit really big starting to come through from the second part of November. Really only one full month this year. You're right, there is some benefit of it this year, but it's for a relatively short period of time. The full benefit of that, and actually potentially other rate cuts that we might see, will be felt from the beginning of next year.

On the Kaspi.kz, do you want to, David, to pull out the slide?

Yeah.

With the metrics. Yeah, great. In terms of the Kaspi.kz, here, we're just one month into it. Obviously, we have been working with Kaspi.kz ourselves for much longer. Our consumers across Kazakhstan, we have been rolled out now across the whole country on our e-commerce platform. Again, as I mentioned, the initial results are quite encouraging. You have the one out of five customers using, and most importantly, Kaspi.kz completes tasks much faster. Two times faster for consumer to add product to favorites, 30% faster to add to the basket. Those are very important metrics. The metrics that we're focused on now, they're all about trust. Kaspi.kz needs to perform the tasks which it is given, because the trust is the most important first phase for this type of service.

This service, it needs to be giving you the recommendations and helping you and guiding you through the process in a highly reliable and highly relevant manner. We're quite encouraged with the Kaspi.kz's performance. In terms of the investments, we have done actually quite a lot of not only investments in terms of the building the data center, which we did last year, the modern data center which enables us enough compute. That actually is results in a number which you see, like three seconds for the response, which I think is remarkable. He can give you highly relevant recommendation when analyzing and going across such a wide range of the products that we sell in just three seconds. Then he can also give you some added value answers based on some of the tasks you actually give him.

It's not just the product listing, but things around the product like reviews, delivery times, ratings, and so on and so forth. In terms of the going forward, we are not thinking about-- First of all, if you think about our competitive advantage compared to many other companies, is that we are operating in 20 million people market. When you think about scaling this type of service in a environment when you operate on a 100 million people market, you have exponential costs associated with rolling out such service. We can enable in a very cost-efficient manner to actually launch the service in Kazakhstan at reasonable costs. That allows us to develop the product, to train the models, and ensure that consumer experience is highly relevant and high quality at a very reasonable cost.

We're not really talking at the moment in terms of price per tokens or anything like that because we are transactional business. For us, what we will measure this functionality in the future is based on how much it actually costs Kaspi.kz to complete the task. Cost to complete the task, the task is enable the purchase. We're a transactional business. The reason why we have been successful historically is because we're always focused enable the transaction. We are not just a chatbot, we're not fancy lifestyle business, we are transactional business. We enable consumers to buy, pay, and shop. Everything that we do eventually results in a transaction. That's an extremely powerful business model. It actually gives us a competitive advantage because transacting means highly relevant information around the transaction.

The reason why the Kaspi.kz has all the ingredients to be highly accurate is because the layer of the data he operates on is extreme accuracy. That's basically is the foundation both of our competitive advantage and also our ability to get this up and running at a very reasonable cost, and the cost will be measured against the transaction, which means complete the purchase. Highly scalable, which means we can deploy this technology in the future in other markets.

Got it. Thank you so much. If I may add another question on the payments, there have been some news about the National QR system. I wonder if you can comment if you saw any changes or any impact and how should the investors think about the long-term impact on the payments business and possibly take rate in the future?

Well, our take rate, as we have said before, is trending towards what is the majority of the payment transactions, and that is actually the transactions which are through our payment system and Kaspi QR, which is priced around 0.95. That's the trend you actually observe. What we have done during the last, in the 2Q, we have introduced two things. We have introduced Apple Pay, which we didn't have before because we thought that Apple Pay was not really necessary for the consumers if we can build much better experience ourselves locally. We introduced Apple Pay and Google Pay. That introduction was driven by the fact that the ability to transact with Apple Pay or Google Pay when you travel, it was something which consumers really asked us quite a lot.

We have decided to launch that service; it brought us additional payment volumes when our consumers travel abroad. That had the positive impact. In Kazakhstan, it doesn't have such an impact, mostly for the international, because again, our consumers, the paying with Kaspi.kz Super App and this range, so we have what? About, I don't remember exact number, but whatever, 800,000 plus/minus points where you can pay with the Kaspi.kz Super App. Consumer in Kazakhstan is extremely happy, and merchants are seamlessly both transacting with each other through our technical capabilities, which we have built. Kaspi Alaqan, also the same, it performs really nicely, especially in the environment where the pay by palm is in high frequency. Sort of environments really. Has been performing really nicely.

We actually scaled Kaspi Alaqan across the country now, during the last, what is it, 30+ days. We worked really closely with the National Bank of Kazakhstan. The priority of National Bank of Kazakhstan and us and all other players in the market was really to make sure that the payment system is highly scalable because of the volumes now on the market, but also highly secured. We have really successfully worked with them during the last, I would say six months, maybe, plus/minus. Really helped to build the secure payment functionality. That functionality is there, our consumers continue transacting with our merchants where they used to, we're getting additional volumes when everybody else is transacting with their mobile applications through our vast majority of our payments network.

Now we see both our consumers and other consumers transacting through the payment network, which is accessible for everyone. We're extremely happy that there is the wide variety of the payment methods as well from everyone. The consumers can choose, and as I've described before, they can choose the most convenient option. When you are traveling, you pay with Apple Pay. When you are in Kazakhstan, you pay with the Kaspi QR or the Kaspi.kz Super App.

Great. Thank you so much.

Our next question comes from James Friedman. James, your line is open. Please go ahead.

Hi. Good morning. Good evening. Mikheil, in your prepared remarks, you alluded to some of the growth initiatives you're anticipating for Turkey next year. I realize now that's not the time, but next year maybe. Could you just remind us what some of those growth plans are for 2027?

Hi, James. Our growth, the way we operate, again, is we're focused on things which are foundational for the merchant experience and the consumer experience. The things which will drive growth next year and are coming through this year are really around increase the speed of delivery. We have increased the speed of delivery roughly about quite substantially. That actually means higher speed of delivery means better conversion rates and the return of customers because they are happy with the consumer experience. The growth on the e-commerce side will just continue growing consumer engagement, mobile app usage, and all the ingredients of this, which is really about delivery and the user experience and so on and so forth. In terms of something which we believe will be fueling sort of long-term growth is the fintech products.

The fintech products we are really excited about, just because that's where our experience is on the one hand. On the other hand, consumers really don't need to buy a TV set. Sorry, they don't need the loan. They need to buy a TV set. Once you are in e-commerce, in the marketplace platform where you actually see the consumer making the actual purchases for the items, this is the best place where the buying decision is happening. This is the best place to introduce the fintech product. Shopping loan, for example, which we have introduced the new shopping loan, which is 0.4% of GMV now. That's a new flow, which enables customers to finance their products seamlessly. There is a whole range of the merchant products, like merchant finance and things like that, which we have done in our home market.

Those would be the primary products which we will launch on the consumer and the merchant side. We will be launching the savings products because in order to fund your growth, you really need the savings. We do have incredible, simple, transparent products which are highly popular in our home market, and those are some of the ideas which we'll bring and technology behind it, because that's something which enables us to scale, we'll bring into 2027. To put it simply, there will be fintech products around consumer, helping them to fund the purchases, fintech products for the merchants so they can actually acquire some of the inventory, and the savings product, which will enable fintech to continue to scale long term.

The fact that we have about $300 million investing into the capital actually gives us a very strong start because that's the funding which we can also use in order to start scaling the fintech products next year. This year we're just building up regular stuff. We just acquired the bank, so we've taken over operational control. Banking systems and things like that for local reporting purposes is something which we're building up. Everything else, we're very comfortable. Risk management, we already rolled out. The mobile application experience, we're already building up in the shopping mall.

Great. Thank you for that. This is the first time that I've analyzed the company that we've seen rates go in your favor, and I'm just wondering, how long does it take to get repriced to the market? What I mean is, in terms of consumer behavior, what have you noticed historically in terms of rate changes going the other way? How durable do you think that this cycle will be? Thank you very much.

James, I just look at inflation. Inflation's been falling now for most of this year. If inflation continues to come down, National Bank rates, which are very high in Kazakhstan by historical standards, will continue to come down. If National Bank rates continue to come down, our deposit rate will come down. You should remember that when rates went up, we weren't the first player in the market to raise rates. When rates go down, it doesn't mean we'll be, I wouldn't expect us to be the first player in the market to lower rates. The long-term dynamic will flow through. I've said to investors before that any rate cuts this year just should give you increased confidence about earnings growth next year. That's the sort of time frame to think about things. Again, it's not about one cut.

What you're looking to see is rate cuts, inflation falling, and for that to be sustained, rate cuts to fall, and for that to be sustained over a decent period of time, in exactly the same way this has been a headwind. You mentioned you've been covering us since beginning of 2024, it's been a headwind for pretty much all of that time, two and a half years.

Okay. Thanks, David. Thanks, Mikheil.

We currently have no further questions; I'd like to hand back to David for some closing remarks.

All right. Sammy, thanks very much. Thank you, everyone, for your time today. Happy to follow up offline. We are in London and New York in early September, post-holiday period, happy to follow up in person. Thanks again for your time today. Keep in touch and have a good summer. Thanks, everyone. Bye-bye.

Thank you. Bye-bye.

This concludes today's call. We thank everyone for joining. You may now disconnect your lines.

Hello, everybody, and welcome to the Kaspi.kz first quarter 2026 financial results. My name is Elliot, and I'll be your coordinator today. If you would like to ask a question, please press the raise hand icon if you have joined the call via Zoom. If you have joined us on the phone, please press star one on your telephone keypad. I would now like to hand you over to David Ferguson, Head of Investor Relations at Kaspi. Please go ahead.

Thank you, Elliot. Good morning, good afternoon, everyone. Welcome to Kaspi.kz first quarter 2026 financial results call. I'm David Ferguson from Kaspi. As usual, with me on the call I've got our Co-Founder and CEO, Mikheil Lomtadze. The rest of the management team, key members of the management team, Tengiz Mosidze and Yuri Didenko, are Deputy CEOs of the company. We're going to do things a little bit differently to how we've done them in the past. For today and going forward, we're going to make the first quarter and the third quarter calls financial updates and where relevant, updates to the guidance. There's no change to today. We'll keep the full year results and the interim results for more detailed calls where Mikheil will talk about the strategy, products, other initiatives going on in the company.

I think this should be a more efficient way of doing things. Particularly, I know a lot of you have multiple companies reporting at the same time, and it should make for more interesting full year and interim results calls. On that note, I will hand over to Mikheil. He'll make a couple of introductory comments, and then I'll take you through the rest of the presentation. Mikheil, over to you.

Thank you, David. Hello, everyone. You know, we have started the year in the first quarter with a good growth and strong growth in e-Commerce, which was driven by the also higher purchasing frequency and some of the services, value-added services, showing additional monetization faster than the GMV growth itself. Our e-Commerce did grew 41% year-over-year on a constant currency and pro forma basis. Importantly, the transactions grew 43% year-over-year. Frequency of the quarterly purchases now reached 15, which is also quite a substantial growth of 44% year-over-year. We are remaining a very profitable company.

You know, we're happy that the board recommended a dividend of KZT 850 per ADS, which represents about 64% payout ratio. The general sort of message for everyone is pretty simple, that we are creating a much larger, you know, bigger, more diversified business. Now we're happy with both building on our strength of the super app, leading positions in our home market, Kazakhstan, but also, you know, creating additional growth in Türkiye. The one thing which I wanted to mention briefly that e-Commerce for us is important as I've mentioned before. You know, we are the company which is focused on the front end of the consumer and merchant relationship.

When I say front end of consumer and merchant relationship, I mean the point where the purchase and sale decision is happening. The purchase and sale decision is happening on e-Commerce, where consumers are searching, reviewing, and buying goods on the one hand, in the future with the help of the AI agents. On the other hand, you have merchants that are also creating those listings and getting additional sales. When you combine this together on top of it, you do have additional value-added services. The simplest today would be advertising and delivery value-added services, which have grown actually quite substantially, about 73% year-over-year. We remain very optimistic. We believe in the future of our company.

As you've probably been already learned that I've made a investment myself alongside with Tencent and other long-term shareholders. I remain fully aligned and true believer in the company. You know, we are really excited about some of the services we're working on. You know, hopefully during the year, as David mentioned, we'll be providing more detailed overview of some of the products we have been already launching. We'll be sharing with you how excited we are about the range of innovations which companies is launching and working on. That's, you know, pretty much everything from me at this stage. Back to you, David.

Sure. Thanks a lot, Mikheil. I'll run through the financials both at the platform, at the group level, and then up guide on the guidance. Just quickly to sort of summarize, consolidated revenue up 31% year-on-year and adjusted EBITDA up 9% year-on-year. I think the simple message, the first quarter on track with where we expected to be. On the dividend, as Mikheil said, KZT 850 a share. This is the same amount as when we brought back the dividend for the fourth quarter, and we said at the time, extrapolate the amount throughout the four quarters of this year. It's consistent with what we've said and what you can assume for forecasting purposes. At a divisional level, marketplace GMV growth of 19%. This is constant currency pro forma.

Just to remind people, we acquired Hepsiburada at the end of January. On a reported basis, it's in the numbers for three months this quarter versus approximately two months in the first quarter of last year. Pro forma constant currency gives you the true indication, the real growth in the business. Marketplace GMV up 19% on the same basis, e-Commerce GMV up 41% year-on-year. That's sort of the true rate of growth in e-Commerce. TPV up 14%, not affected to any material extent by Hepsiburada. TFV down 2%, but average loan portfolio up 23%, and I'll talk a little bit more about that later on. Moving on to the segments.

As we talked about both at the full year results and for that matter over the last 12 months, e-Commerce is one of our most important areas of focus and will be one of the main drivers of growth over the next couple of years. E-commerce GMV up 41% year-on-year. Again, constant currency pro forma like for like, driven by purchases up 43% year on year. Here again, we've spoken about the importance of driving order growth both in Kazakhstan and in Türkiye. You see the result of this or another way of looking at this, purchases for consumer on e-Commerce up from 10.4 last year to 15 this year. That's really an indication that the existing consumer base is becoming more engaged.

As we scale an engaged consumer base, it drives more opportunities for monetization around advertising, delivery, Fintech, and so on. It's the foundation of sustainable, healthy, long-term profitability in e-Commerce. That metric moving very much in the right direction and contributing to the take rate increasing up 90 basis points year on year to 15.8%. Today, around half of the GMV is coming from Kazakhstan and Turkey, so the businesses are broadly equal in size and importance, with the bulk of the marketplace business being 3P. The 1P component is coming primarily from Hepsi. Around a third of their GMV is 1P, with e-Grocery in Kazakhstan also contributing. To reinforce that point, you now see e-Commerce revenue growing faster than GMV because of take rate expansion or because of growth in value-added services.

In this case, this is advertising and delivery revenue up 73% year-on-year versus e-Commerce revenue growth up 58% year-on-year. Again, with a more engaged user base, more opportunities to drive monetization, and you see this coming through here. The revenue growth is, just to be clear, on the reported basis. If we look at marketplace growth, again, just to keep in mind, e-Commerce is around 60% of market GMV, marketplace GMV. The other 40% comes primarily from m-Commerce and to a lesser extent, travel in Kazakhstan. GMV growing at a slower rate, up 19% year-on-year, but with revenue growth up 49% and EBITDA up 12%. What we are seeing really is that that transition from offline to online retail or that transition from m-Commerce to e-Commerce is gathering momentum.

Hence, the stronger growth from e-Commerce versus overall marketplace GMV growth. Revenue up 49% for marketplace and EBITDA up 12%. On the EBITDA, that primarily reflects the inclusion of Hepsiburada for the three-month period versus two months in 2025. As you know, as we've said previously, the aim with Hepsiburada is to keep it around EBITDA breakeven this year. You've got a full three-month consolidation of a business that's around EBITDA breakeven, slightly positive, hence the slower EBITDA growth versus the revenue growth. Moving on to payments. Our payments, 15% TPV growth versus Sorry, 14% TPV growth versus the guidance of around 15%. Revenue growing at a slower rate, up 7% year-on-year as a result of take rate compression.

That is consistent with longer run trends driven by change in product mix in favor of Kaspi QR and particularly Kaspi B2B payments and overall flat EBITDA growth. Keep in mind that EBITDA excludes interest revenue. Interest revenue is around a quarter of payments revenue, and the EBITDA metric doesn't capture that. It is around a quarter of revenue, and it grew about 26% year-on-year. Overall payments is large, more mature business, but still highly profitable and highly cash generative, as well as strategically being the driver of engagement across our other businesses in Kazakhstan. Moving on to Fintech, and I'll spend a bit more time on this slide.

First of all, average net loan portfolio growth of 23% versus TFV decline of 2% and versus the guidance for the year of 5% TFV growth. We're deliberately choosing to prioritize longer duration loans that generate revenue, that generate more revenue. TFV is an indication of origination, but TFV in itself doesn't drive revenue or financials. It's average loan portfolio that drives revenue, that drives bottom line of the business. We're favoring longer duration loans which generate more revenue. You can see the duration of the portfolio is increased from 7.9 months-9.3 months. Effectively what's happening is BNPL, small ticket short duration is becoming smaller in the portfolio mix and merchant financing and the general purpose loan, which are the longer duration loans are becoming larger in the mix.

While this change is going on, you have this sort of divergence between loan portfolio growth or widening between loan portfolio growth and TFV growth. The combination of 23% loan portfolio growth with stable pricings, Fintech yield of 6% year-on-year translates into 25% revenue growth and 12% adjusted EBITDA growth year-on-year. As we've talked about for now several years, the EBITDA growth is being impacted by a higher funding costs, increased around 220 basis points year-on-year on the back of the interest rate increases in Kazakhstan last year and continues to pressure growth. If rates start to move down, and hopefully now we are at the point where rates have peaked, that will be very helpful to growth next year, profitability growth next year.

I'll also just talk a little bit on the risk metrics because I've had a lot of questions on this over the last couple of months. If you want to look at sort of understand risk in the portfolio and the dynamic, how it's changing, first and second payment default, number one, and delinquency rates are some of the best sort of real-time metrics that we can look at. First and second payment default, people who've taken a loan and immediately missed a payment. You can see that number one, the levels of default are low, 0.9% and 0.4%. That's extremely low. Number two, if you look at the trend going back to the beginning of 2023, it's broadly stable.

There can be some variation at different periods, particularly due to seasonality, but overall, it's a pretty flat chart, pretty flat line. Similarly on delinquency rates, so looking across the portfolio, people who've just missed a payment, a good indication, a good lead indicator for credit quality. Again, exactly the same sort of conclusion, 2.2%, a very low delinquency rate and again, the trend broadly stable over the last couple of years. Whilst a lot of people are focused on peers and then NPL metrics, it's also important when you look at peers to actually look at their sort of real-time risk metrics to get a true understanding of the health of the portfolio.

On the back of those comments, cost of risk, again, broadly flat year-over-year, up 10 basis points to 0.7%, versus 0.6%. On the NPL ratio, NPL ratio moving up, again, the same comments that I've made previously. As the portfolio is shifting towards lower risk merchant finance and car loan, the car loan being secured, what that means is that the probability of collection on NPLs is improving, so we keep more NPLs on the balance sheet. This ratio is effectively just the timing, driven by the timing of write-off rather than the quality of the portfolio. As we keep more loans on the balance sheet because the probability of collection is improving with a higher probability, lower NPL coverage, particularly for the car loan, which is a secured product.

Effectively this coverage ratio is just a function, the change in the coverage ratio is just a function of the change in mix of the loan portfolio in favor of lower risk products that require lower levels of coverage. As mix changes, that will determine how the NPL ratio, coverage ratio changes over time. It's not a change in the underlying coverage of a specific product necessarily. Here are the reported consolidated numbers. Revenue up 31% year-on-year, EBITDA up 9% year-on-year, and net income flat, down 1% year-on-year. Just to put a bit more color around the net income trend, there's two things that are really driving it. One, higher interest expense. I mentioned funding costs in Kazakhstan have gone up 220 basis points year-on-year.

It's funding costs actually in both Kazakhstan and Türkiye, number one. Number two, COGS. What does that mean? That is just driven by the inclusion of Hepsiburada, which has this wonky business that comes with COGS for three months versus two months previously. Thereafter, if you look at the other cost lines, yes, we're making investments into Hepsiburada. If you look at the weight of the extent to which tech and product spend or sales and marketing spend is weighing on profitability is actually relatively minor, under control, where we'd expect it to be. On the guidance, GMV around 20% for the full year on track, unchanged. Same comment for TPV, 15% on track, unchanged. On the TFV, the around 5% was trending below that currently. To some extent, it's a moot point.

The key is to drive faster revenue growth rather than necessarily to drive 5% TFV growth. Overall, that's trending to around 5%. We're on track for around 5% EBITDA growth for the year. Clearly above that in the first quarter, therefore implying slower growth in subsequent quarters, but pretty much exactly where we want to be at this point in time. On that note, let's open the call up to Q&A, please, Elliot.

Thank you. For our Q&A, if you would like to ask a question, please press the Raise Hand icon found on your screen if you've joined the call via Zoom. If you've joined us on the phone, please press star one on your telephone keypad. When preparing to ask your question, please ensure your line is unmuted locally. First question comes from Gabor Kemeny. Please state your company name and proceed with your question.

Hi there. This is Gabor Kemeny from Autonomous Research. I have a few questions. First one will be on Turkey, where your losses narrowed significantly in Q1. You are guiding us towards break-even EBITDA going forward. Can you give us a sense of what sort of losses shall we assume over 2026 in Turkey? Second one will be on the marketplace take rate, which showed a very decent increase in the first quarter. Can you give us a flavor how much seasonality did you notice there in the first quarter? What shall we model here going forward? Some guidance would be helpful. Finally, you made a point that Kazakh interest rates falling might impact your NII next year.

Can you give us some sensitivities to your funding cost and your NIM to falling Kazakh rates? Can you comment on what you actually expect, how you actually expect Kazakh rates to develop from here? Thank you.

Gabor, thanks for the questions. Maybe I'll start and then Mikheil may add some additional comments. I'll do it in reverse order. On the last one on interest rate cuts, we don't assume any interest rate cuts in the guidance this year. I think all you can do or we can do and all you can do is just look at trends in inflation data, and you can see that inflation, it appears, peaked in Kazakhstan in September and has started to fall at quite a decent rate over the last couple of months. That's an encouraging lead indicator. In terms of sensitivity, I would advise just to look at the full-year results presentation from last year because there you see the impact.

We pulled out the impact of last year's interest rate increases on the net income in Kazakhstan. I think broadly, if I remember correctly, if you look in 2025 in Kazakhstan, interest rates moving or our cost of funding moving up by somewhere between 100 basis points-150 basis points knocked around sort of 4% off the net income growth in Kazakhstan. That was all sort of set out last year, so that would be a decent proxy for you to take. On the marketplace take rate, I wouldn't say it's sort of anything to do with seasonality. It's a function of advertising and delivery, and there's been a trend over many years of growing value-added services, which has been additive to take rate.

I would just look at, again, the sort of the increase that you've seen last year year-on-year, and use that as a proxy for what you might expect to see this year. On Turkey, we guide EBITDA breakeven, at least EBITDA breakeven. We've also talked about free cash flow positive as the guardrails we're putting around this business. I wouldn't specifically comment on net income. I'd also just comment that the main focus is really driving engagement, making the investments to drive engagement on the platform, which you'll see first of all through the orders, and that's the best sort of lead indicator for the progress that we're making.

It's very clear. Thank you, David.

Thanks, Gabor. Next question, please.

We now turn to [Maxim Makarov]. Your line is open. Please go ahead.

Hi, Max.

Hi. Thank you for the presentation. I appreciate your comments regarding the first of all being more focused on financials, but I have to ask about Tencent recently acquiring a minority stake. How should we think about any potential strategic synergies going forward from that and whether it changes in any way your positioning the super app in Kazakhstan and Turkey? That's the first question. The second one is about the marketplace growth in Kazakhstan specifically and any updates on the smartphone situation. Has it normalized? Whether you see any impact from the current situation in the Middle East on the electronic supply.

The third one, final one is on the guidance. We saw EBITDA growth trending above the full year guidance. It's 9%. Your guidance hasn't changed. What kind of factors do you take into account when kind of maintaining the guidance? Should we expect some heavier investments in Turkey or any other reasons? Yeah. Thank you.

All right. Thanks for your questions, Max. I'll take the questions on sort of marketplace growth and guidance, and then maybe Mikheil will make a comment on both the Tencent and his own investment. Yeah, just keep in mind it's the first quarter. The first quarter is exactly where it's the smallest quarter of the year. Q4 is the most important quarter of the year. It's pretty much where we'd expect it to be. You will see in subsequent quarters, the timing of investment having more of an impact on EBITDA and the bottom line. I wouldn't get carried away. That's the first thing. On the marketplace growth, I'd say no material.

There may have been some disruption, but I'd say no material disruption as a result of what's going on in the Middle East and, or supply chain disruption. Broadly speaking, and as a very general comment, the current macro situation or the current geopolitical situation is probably more positive than negative for Kazakhstan macro, but a lot depends on how things evolve over time. That's on your second and third question. On Tencent, Mikheil, is there anything you'd like to add?

I mean, it's exciting to have such a shareholder and the team that was working on the transaction in general. We have been quite admirers of Tencent, you know, believing that Tencent is the pioneer of the super app business model. You know, let's You know, I don't really have anything specific to comment, but in general, when you look at Kaspi is the type of company which is and the team, which is really hungry for knowledge and constant development and improving and developing some of the really incredible innovative services which we always have very strong pipeline of.

I guess, you know, having this relationship with the Tencent, and, you know, some other companies, actually benefiting really us. Also we have a lot to share. There is nothing really specific at the moment which I would like to discuss on this call. Again, you should always keep in mind that you are working with the company and with the management team, which is as hungry and as ever, is constantly learning and constantly thinking, you know, what is the next breakthrough product which is going to change consumer, revolutionize actually consumer experience and the merchant experience. Having such a shareholder is a good thing for us. Thank you.

Great. Thank you so much.

We now turn to James Friedman. Please state your company name and proceed with your question.

Good evening, good morning. It's Jamie at Susquehanna. When you originally bought Hepsiburada, your observations were that the service quality was below what you are accustomed to delivering and that you needed to invest in Hepsi, especially in terms of delivery. I was wondering where you think you are in that journey now. You know, and the metrics that you use, what are you focused on? How have you improved the service, and what are your future objectives with it?

I guess I will take this call, David, right? Yeah. In terms of the, of the strategy, you know, the strategy in our understanding of the, of the word strategy is this is not the thing which you sort of turn on or off from one call to another. We did have a substantial discussion about some of the metrics we would like to bring our Turkey business towards. Those metrics are really the Kaspi's metrics, and they're related to the frequency of the consumer purchases, speed of delivery, and accessibility of the financial options on the marketplace, which again drive the GMV per consumer.

Those metrics have been improving quite nicely during last year, and we see pretty much the same trend. We retain, you know, exactly the same focus. I need to make one sort of comment that it's where we would like that we deliver the same quality of the experience in Türkiye like we do in our home market. That's our goal. It does mean that the experience currently is, I mean, is as good as other players on the market. All the investments we're doing, they are around technology.

They are around organizing the data so that it's readily available in the structure for real-time decision-making and you know, some of the models which we're currently building to enhance consumer and merchant experience. Then to deliver as quickly as possible, and deliver on the weekends or deliver on holidays, but actually deliver the items when consumers want them. If, if you think from the number perspective, this is where all the investments are going. The increase that you saw in the investments were actually around those priorities. We're quite pleased. That's what is reflected in the growth as well.

The reason why we're pleased is that these decisions which we're making and the new initiatives which we're sort of rolling out and completing on the, again, delivery, payment options, the advertising products, personalization, risk management, marketing, all those are giving the results which you see in the growth. That's what keeps us really excited for such a large market. Just to go back again to our strategic strategy is that the e-Commerce in Kazakhstan when we started our business, we started from sort of financial Fintech payments and then e-Commerce. In Turkey, we're working backwards because we actually do have very strong consumer base. We do have the strong base of the merchants, and we do have the online interaction and traffic and the engagement from both.

Now what we really need to do is we really need to roll out some of the services and technology which we have in-house and that what you actually see in some of the numbers for the first Q.

Okay, great. The engagement is increasing significantly. When you think about where that could potentially go, how do you see that traveling? I think the statistics are that the average U.S. consumer transacts e-Commerce 40x a year. I think the average Brazilian is about 10x a year. Where do you think that that will travel to over long term in Turkey, Mikheil?

Yeah. Well, I mean, Jamie, in our, in our case, our sort of benchmark is really, what we have already achieved in our home market. If you think in terms of our home market, you know, if I'm not mistaken, the numbers which we have discussed in the year-end, was it about 27 purchases per consumer? I think, in our home market, in Kazakhstan. There are about seven purchases per consumer in Türkiye. So that just gives you an understanding where what we're really focused on. Again, we're not inventing anything. We're basically taking our playbook, and we're focused, you know, on execution and making sure that technology and data supports it. So that's where our primary focus on.

Of course, this sort of engagement, you know, you are required to make some investments in order to explain your user experience, in order to market it. That's why this year is more of the, you know, I would call it an investment year. We do have our rules, which we would like to still remain a very profitable dividend-paying company. We do have guardrails for the decisions we make, but that's our focus. We want to increase the consumer engagement. We want to have the right assortment for that engagement. We want to have the right merchant base and delivery and the payment methods which support that. The difference, again, as I mentioned, around seven in Turkey and around 27 in Kazakhstan.

In Kazakhstan, growing really, really fast. It will be even bigger this year. Basically, that would be our sort of goal for Turkey.

Okay, perfect. Thank you. I'll drop back in the queue.

Thank you, James.

Now hands over to Hanzade Kilickiran. Please state your company name and proceed with your question.

Mikheil, David, thank you for the presentation. I'm Hanzade Kilickiran covering Hepsiburada at JPMorgan. If I may, I would like to ask a few questions on your strategy for Hepsi. Actually, this question has been partially answered, but you have been consuming some cash in Türkiye after stepping up in marketing campaigns in the past few quarters. This also seemed to put some pressure on the working capital outflows, I mean, particularly in this quarter, which may be, though, a seasonal shift. I wonder, how long will you continue on this strategy? Is there a specific KPI target that you would like to reach before normalizing the marketing activities? That's my first question. The second one is, we have also observed some decline in consumer financing activities in the first quarter in Türkiye.

Is this a deliberate decision like pausing on Hepsipay products before you finalize your license approval in Türkiye? The third one is that, after the initiatives that you have taken in Türkiye, like listing of the small ticket items, which you have been quite successful actually, have you achieved a more diversified GMV, GMVs per category? Thank you.

Yeah, thank you for the questions. In terms of if I got them right, but you please tell me if I miss anything. In terms of the consumer financing, and the consumer finance side, you know, we have our sort of way of really working both on the product side, but most importantly, you know, risk management. It's not only about originating consumer finance, but actually it's about originating that to the right person at the right time with the right amount, but also in the way that the people are sort of repaying you basically. When you originate the wrong consumer finance, it's not an asset, it's a liability for the company in terms of the risk.

We have been really happy with the way we have rolled out the, you know, the new risk management system. As we were rolling out the risk management system, you know, we basically slowed down the origination. If for everybody's benefit on the call, the Hepsiburada has fully owned consumer finance subsidiary. Actually, you know, we in Turkey can originate consumer loans. We wanted to get first the whole system, which, you know, Kaspi has to bring it to the to our business in Turkey and then, you know, we feel now increasingly comfortable with the opportunities to do more in the consumer finance. That's, that's on the consumer finance side. Again, we were not in a hurry.

We didn't want to originate anything above the normal course of business. We're putting together the risk systems and data management in order to do it at the extraordinary quality, which is acceptable at our level. Like we have, you know, cost of risk a bit over 2% in Kaspi, which is world-class. That's on the consumer finance side. In terms of the diversification, well, what we have done really last year is which gave us, as you said, the very strong results, is we are focused on the merchants and we've realized that if we want to promote the merchants and give them ability to sell the low-ticket items, we actually had to improve our delivery experience, but also provide the reasonable delivery fees.

That's what we have done last year. We continue doing it this year. We also roll out, you know, our data-driven logistics platform. We're actually, you know, completing this in the first Q, and that's something which with the help of our, you know, LLM and forecasting models, you know, that will give us a substantial improvement in the speed of delivery and the quality. We're quite happy with the performance, and we see the low-ticket items growing really fast, but also 3P growing faster than 1P. That's on the merchant side and low tickets. In terms of the marketing, again, we're a data-driven company, so we're not really focused on just, you know, making sort of driving the traffic in the short term.

We're not driven by the weekly targets or whatever. We're really driven by, you know, putting the system in place, which enables us to have a profitable growth in the future. From that perspective, when we do marketing, we're not solving the short-term targets. We are actually building the engine to generate the very sustainable recurring and repetitive target traffic from our consumers. Yeah, that's what we have done last year, and that's what we will continue doing this year. Our goal is simple, that the consumers that we acquire, they continue to be engaged with us and deliver value and the profits in the future. You know, initially, you really do need to invest in order for consumers to experience your products and services.

Thank you, Mikheil. Is it reasonable to say that your initial target is more like frequency focus? I mean, to take up the Turkey's frequency numbers close to Kaspi.

Our focus is engaged consumer base. An engaged consumer base comes with a frequency. Frequency is just one indicator that consumers love your products and they come back to you and shop with you frequently. Yes, you're correct.

Thank you very much.

Thank you, Hanzade.

We now turn to Sergej Belozerov. Please state your company name and proceed with your question.

Hi, this is Sergej calling from Greyhound Capital. Good to see a results improvement in Turkey. I have two, three questions. One is on Rabobank. Has there been any update or is there any reason for the delay? Then on, in Kazakhstan, on the payment take rate, you mentioned already it has come down quite a bit. Is that the reason? What are the reasons behind that? Is it the shared QR code? Have we seen the worst in terms of the drop or what's the current situation and what can we expect going forward? Lastly, on Tencent, you already briefly touched on it.

I would like to understand, is it purely passive investments from Tencent or more deeper cooperation? Is there a potential that they acquire a bigger stake in your company from maybe our larger shareholders who want to sell? Thank you.

All right, Serge, thank you for your questions. I'll certainly start. Payments take rate, it's nothing to I know we've spoken before about national payment system. It's nothing to do with that. If you look at the sort of take rate decline, you look at it over the last three years, 3-5 years for that matter, I think you'd see that it's broadly consistent each year. It's largely been driven by Kaspi QR at 95 basis points and Kaspi B2B payments, which is a lower take rate product growing in share. It's purely mix mechanical. It will continue to the extent that Kaspi QR continues to outperform other payment products. I guess can't broadly be go below 95 basis points. It's kind of the floor. That's on that. On Rabobank, no update, nothing to report.

Base case remains that we hope to close the transaction over by the summer. It's kind of out of our hands. The wheels turn slowly, we continue to work and aim for closing at that point. On Tencent, I'm not sure if there's much we can add, I wouldn't wanna sort of speculate on their behalf about what they might do or might not do in the future. Maybe that, I think your question is a question for Tencent, not a question for Kaspi.

Well, perhaps just if it's pure passive investment or a deeper cooperation, maybe if you could answer that would be great.

Yeah. All right. Sorry, yeah. Fair question. It's primarily a financial investment.

Perfect. Thank you very much.

I'll turn to [Ronak Gadia]. Please state your company name and proceed with your question.

[Ronak], you might be on mute.

Hey, hey, good afternoon. hope you can hear me now. yes, this is [Ronak] from Dunross. maybe, I've got about three questions. First one, I guess, is just a follow-up from the previous caller. On the payment side, obviously the decline in take rate is understood, and you can see that in the revenue reduction. I was just trying to understand what are the factors driving the drop in EBITDA? Because you could see the EBITDA was flat on a year-on-year basis. if you could just comment on what the drivers there were. Going to the Fintech space, like you mentioned, you know, the focus is to grow the car finance and merchant loans.

Could you maybe give some guidance on what the implications of that would be in terms of on the NIMs? What are the respective lending rates for those segments vis-a-vis unsecured loans and BNPL? Then the last one, just on the recent capital that you raised, the $600 million, if you could just give some insights into how that will be deployed. Will all of that be injected into Turkey, or will there be some sort of split between Turkey and Kazakhstan? Thank you.

Thanks, [Ronak]. On the last question, the official line is general corporate purposes. What does that mean? There's no one specific big bang project, across both Kazakhstan and Turkey, there's multiple initiatives, growth initiatives. This just gives us more flexibility in how we fund those initiatives. We're pretty pleased that we were able to raise the $600 million at the 5.9% rate that we were able to do that at. More flexibility at a cost that makes a lot of sense for us. That's on that side of things. I mean, on Fintech take rate, of Fintech pricing. You should look at the trend over the last 12 months at the gross level.

It's been broadly stable. I wouldn't wanna provide guidance going forward, but I wouldn't expect it to be dramatically different to that going forward. I think there was another question that I've forgotten.

Take rate on payments. I think the, you know, take rate on payments is answer is exactly the same and quite simple, and that what something which we have said on every quarter of our results, is basically that 0.95% is the acquiring fee on the QR codes. The share of QR codes is increasing. There is about 0.5% roughly on the B2B payments, which is increasing even faster. It's a function of the faster-growing, you know, bigger numbers on the payment side. In terms of the EBITDA margin or I mean, this is like, what. 50%+ EBITDA margin business.

I mean, from that perspective, I mean, it's really a very profitable business. It's just such a huge scale that there is no really, you know, economies of scale at this stage. It's a big business. It's matured. We do are making some innovations in this field, like, you know, Kaspi Alaqan, for example, which has close, you know, to the 1 million registered users already and growing quite nicely. Again, this is a really big business which delivers profitability on the one hand, but also, most importantly, actually delivers the engagement from the consumers and merchants, which is the backbone for anything we do now.

Whether you think in terms of the e-Commerce or if you think in terms of AI technology and things like that's the big boon for, you know, future innovation. The direct monetization is nice, very important, but actually, as far as I'm concerned from 5-10 years perspective, it's secondary. What it really gives us is this huge advantage of having, you know, incredibly high-quality data, which enables us to train our models to be very precise in their decision-making.

Sure. Thanks, guys.

Thank you.

We have no further questions. I'll hand back to you, David, for any final remarks.

All right. Thanks, Elliot. Thanks everyone for your time today. Please feel free to reach out if you'd like to follow up on anything. I know we've got a few guys in Kazakhstan this week, so looking forward to seeing you. Thanks a lot, and speak soon. Thank you. Bye-bye.

Thank you. Bye-bye.

Thank you, everyone. This concludes today's webinar. You may now disconnect from the call.