German Fintech NAGA Continues Strong Growth Path

The number of new customers and trading volumes has grown significantly with an increase of over 50% since Q1.

Hamburg-based NAGA Group has reported further strong growth in the current second quarter of 2020, the firm announced today. The number of new customers and trading volumes has grown significantly, with an increase of over 50% since Q1, according to NAGA.

“With the recovery of the financial markets and despite weakening volatility, we were able to continue on our growth path. Our new customer registrations and trading activity are developing positively. In April and May alone, we were able to exceed the trading volume of the entire first quarter with a total of EUR 24 billion, and welcomed more new customers than in the first 3 months of the year together”, said Benjamin Bilski, CEO at NAGA Group.

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The company also reported its first customers and sales from China. After months of preparation, the operational business started on 7 June 2020, and the first customers were accepted.

Bilski said that offering NAGA’s service in China has been the firm’s goal for a long time.

“We anticipate healthy and sustainable growth and will focus heavily on the project in China. The potential is extremely large in this market,” he added.

Furthermore, NAGA’s upcoming challenger bank app “NAGA Pay” met with a lot of interest recording 5,000 pre-registrations just weeks after the announcement of its launch for Q4 this year, which supports the company’s strategy to enter the mobile-banking segment.

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Raising additional growth capital

Based on the greatly improved earnings and the targeted expansion course in Southeast Asia and China, the Management Board has decided to raise additional growth capital, according to NAGA.

As a result, the firm today resolved a cash capital increase with subscription rights for the shareholders. Up to 2,000,000 new shares are to be issued at a subscription price of EUR 2.50 per new share. Shareholders can subscribe to two new shares for thirty-nine old shares. The subscription period is expected to begin on 03 July 2020 and is expected to end on 16 July 2020 (inclusive).

In addition, the new shares are to be offered to qualified investors at a placement price of EUR 2.50 – and thus, at a price that corresponds to the subscription price – as part of a pre-placement starting today. Hauck & Aufhäuser accompanies the placement as Sole Global Coordinator and Sole Bookrunner. The new shares will initially be offered for sale as part of a private placement to qualified investors in Germany and other select jurisdictions (outside the United States).

Bilski said that after last year’s very exhausting restructuring, NAGA got back on track. The greatly improved and focused marketing strategy, combined with a significant reduction in costs and the focus on new markets, made the major difference compared to the years before, he noted.

Additionally, the firm published its results for the past financial year 2019. The announced and implemented restructuring resulted in high one-time expenses, particularly in the form of severance and compensation payments.

According to preliminary figures, NAGA will, therefore, see 2019 at the group level with declining trading revenues of EUR 3,897 thousand (previous year: EUR 4,222 thousand), a negative EBITDA of EUR -9,167 thousand (previous year: EUR -EUR 270 thousand) and an annual net result of EUR -13,377 thousand (previous year: -EUR 4,401 thousand).

“The result of the 2019 financial year compared to 2020 once again underpins the success of the realigned company strategy. This momentum allows us to fully position NAGA for global expansion and sustainable growth,” Bilski concluded.

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