QIWI Plc (NASDAQ:QIWI) Q2 2020 Earnings Conference Call - Final Transcript

Aug 19, 2020 • 08:30 am ET

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QIWI Plc (NASDAQ:QIWI) Q2 2020 Earnings Conference Call - Final Transcript

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Q & A
Operator
Operator

Thank you. [Operator Instructions] Our first question comes from the line of Chris Kennedy with William Blair. Please proceed with your question.

Analyst
Chris Kennedy

Hello. Thanks for taking the question. Can you go into a little bit more color on your B2B initiatives, please? Thank you.

Executive
Varvara Kiseleva

Chris, I'm sorry for the radio silence. We're trying to see if the equipment works well. So, Boris will take the question. He will talk about --

Executive
Boris Kim

No, I'm okay. I'm okay. I was just on mute. I was just on mute. Thank you, Varvara.

Executive
Varvara Kiseleva

Yes.

Executive
Boris Kim

Thank you for your question. My understanding is that your question refers to Flocktory and Factoring business. Indeed, we have consolidated 100% of Flocktory in December and this company is a B2B company which provides the management of customer cycle. It's basically a beta company and you -- what is viewed by this company that they showed very good results even during the crisis, which is -- I would say -- more or less obvious, because especially during the crisis time, relationship with customers, attracting new customer and keeping loyalty with old customer is necessary for all the companies, especially in e-commerce segment.

The second company in B2B segment is Factoring PLUS. They offer structured financing for SME segment. So, they work with SME company which works with big companies, so they have some orders from them, they provide with materials of services for big company.

And they have two basic products, factoring itself and bank guarantees. Both products demonstrated very good resilience to provided situation during the first half of the year. And the business model looks very promising and we are planning to develop the ecosystem for SME segment in this field, providing new product. And so, we are discussing like three new products which we are going to launch to the end of this year.

Analyst
Chris Kennedy

Great. Thanks for that additional color. And then just one other one. Can you give an update on the sports betting market and I understand there's some regulatory changes in the fall; how could that impact your business? Thanks a lot guys.

Executive
Boris Kim

Yes, I will give you a small update regarding the regulation of betting segment, and probably Andrey will give you some more details regarding market itself.

You know that we already mentioned that the government was considering the proposal from Boxing Federation regarding the change in regulation of betting market. And according to the media report, the government has decided to postpone the discussion of this proposal and until autumn.

And the first reaction of regulators and market participants to the proposal was generally negative. At the grant of its proposal, the federation mentioned below contributions to the development of sports and the lack of transparency in their calculations. These problems were addressed with the adoption in July of two laws specifying the regulation of the industry.

They also reported in the press about the affiliation of the Boxing Federation on one of the market players and at least they have