Georgia Capital PLC · LSE:CGEO
Georgia Capital — Q1 2025 Earnings Presentation
20 slides from Georgia Capital's earnings presentation, 2025
Slide 1: Macroeconomic Overview 1Q25 Results
MACROECONOMIC OVERVIEW 1Q25 RESULTS 1
Slide 2: Georgia's economy on an upward trajectory, nominal GDP to exceed GEL 100 billion
GEORGIA’S ECONOMY IS ON AN UPWARD TRAJECTORY, WITH NOMINAL GDP PROJECTED TO EXCEED GEL 100 BILLION IN 2025 NOMINAL GDP IS EXPECTED TO EXCEED GEL 100 BILLION IN 2025 GEORGIA’S ECONOMY CONTINUED TO EXPAND IN 2025, WITH PRELIMINARY ECONOMIC 9,571 GROWTH AT 9.3% Y-O-Y IN 1Q25 10,000 Nominal GDP, USD bn,
Slide 3: Stronger-than-expected growth supported by domestic activity and external inflows
STRONGER-THAN-EXPECTED ECONOMIC GROWTH IS SUPPORTED BY ROBUST DOMESTIC ACTIVITY AND EXTERNAL INFLOWS LOANS GROWTH DECOMPOSITION BY PURPOSE (ON A CONSTANT CURRENCY BASIS) GENERAL GOVERNMENT FISCAL EXPENSES AND FISCAL DEFICIT (IMF MODIFIED) Consumer Loans Mortgage Current Expenditures Capital Expendit
Slide 4: Price pressures re-emerged, pushing inflation above 3% target
PRICE PRESSURES HAVE RE-EMERGED, PUSHING INFLATION ABOVE 3% TARGET FOR THE FIRST TIME SINCE MARCH 2023 INFLATION REACHED 3.5% Y-O-Y, EXCEEDING THE TARGET FOR THE FIRST TIME SINCE MIXED INFLATION HAS BEEN PICKING UP THE MOST AMONG THE INFLATION MARCH 2023 COMPONENTS Headline Inflation Target End of P
Slide 5: Strong growth drives deleveraging, boosting resilience
STRONG GROWTH IN RECENT YEARS DRIVES SIGNIFICANT DELEVERAGING, BOOSTING RESILIENCE AND UNLOCKING INVESTMENT POTENTIAL GOVERNMENT DEBT AS A PERCENT OF GDP AT ITS LOWEST SINCE 2014, ON THE BACK OF INTERNATIONAL INVESTMENT POSITION (% OF GDP) IMPROVED SIGNIFICANTLY, STRONG ECONOMIC GROWTH AND EXCHANGE
Slide 6: Macroeconomic wrap-up
STRONG GDP GROWTH – PROJECTED NOMINAL GDP TO SURPASS GEL 100 BILLION IN 2025 INFLATION HAS EXCEEDED THE TARGET FOR THE FIRST TIME IN TWO YEARS NBG RE-ENTERED THE FX MARKET WITH A US$ 102 MILLION MACROECONOMIC PURCHASE IN MARCH WRAP-UP SIGNIFICANT DELEVERAGING, BOOSTING RESILIENCE AND UNLOCKING INVES
Slide 7: Sovereign ratings with favourable macro fundamentals
SOVEREIGN RATINGS WITH FAVOURABLE MACRO FUNDAMENTALS Key Ratings Highlights General Facts Rating Agency Rating Outlook Affirmed Ba2 Negative March 2025 BB Stable February 2025 Georgia BB Negative December 2024 Georgia is favorably placed among peers Fitch Rating Country Country Rating Outlook ▪ Area
Slide 8: Georgia's key economic drivers
GEORGIA’S KEY ECONOMIC DRIVERS Top performer compared to peers across a wide range of international rankings Liberal ▪ Liberty Act (effective January 2014) ensures a credible fiscal framework; Fiscal deficit/GDP capped at 3%; Public debt/GDP capped at 60%. economic policy ▪ Following the emergency c
Slide 9: Institutional oriented reforms
INSTITUTIONAL ORIENTED REFORMS OPEN BUDGET INDEX, 2023 | INTERNATIONAL BUDGET PARTNERSHIP ECONOMIC FREEDOM INDEX | 2025 (HERITAGE FOUNDATION) (BUDGET TRANSPARENCY) Ireland 3 Georgia 1 Sweden 3 Lithuania 16 Moldova 5 Czech Republic 20 Norway 8 Latvia 24 Bulgaria 10 Italy 13 Portugal 25 Germany 14 Jap
Slide 10: Economic growth continuing at pace
ECONOMIC GROWTH CONTINUING AT PACE GROSS DOMESTIC PRODUCT NOMINAL GDP STRUCTURE, 2024 Nominal GDP, GEL bln (LHS) Real GDP, YoY % 92 24% 90 81 80 73 20% 70 61 16% Public 60 50 50 11.0% Administration Agriculture, 45 10.6% 9.4% 12% 50 41 7.8% Construction, , 7.0% 6.2% 35 37 40 28 29 32 8% Trade, 15.2%
Slide 11: Unemployment rate at historical lows
UNEMPLOYMENT RATE AT HISTORICAL LOWS UNEMPLOYMENT RATE AT HISTORICAL LOWS, DOWN TO 13.9% IN 2024 FROM 16.4% IN 2023 LABOR FORCE STRUCTURE 30% 27.2% 26.7% Employed Unemployed Labor force Labour force participation rate,% 25% 23.0% 22.1% 1,800 60% 21.7% 20.4% 1,676 19.0% 1,655 1,654 1,641 19.2% 18.1%
Slide 12: Inflation has exceeded the target for the first time in two years
INFLATION HAS EXCEEDED THE TARGET FOR THE FIRST TIME IN TWO YEARS INFLATION Y-O-Y VS. INFLATION TARGET INFLATION COMPONENTS Food and non-alcoholic beverages Alcoholic beverages and tobacco Transport 16 Headline Inflation Core Inflation Target Monetary Policy Rate Housing and utilities Other Inflatio
Slide 13: Exports have increased, driven by re-exported motor cars
EXPORTS HAVE INCREASED, DRIVEN BY CONTINUED STRENGTH IN RE-EXPORTED MOTOR CARS AND RECOVERY IN DOMESTIC GOODS REMITTANCES STABILIZING AS DECLINE FROM RUSSIA IS OFFSET BY INCREASING TRANSFERS RE-EXPORTED MOTOR CARS CONTRIBUTING MOST TO THE SURGING EXPORT IN THE LAST FROM OTHER COUNTRIES QUARTERS Copp
Slide 14: CA deficit narrowed due to improving services and income accounts
CA DEFICIT HAS NARROWED MAINLY DUE TO THE IMPROVING SERVICES AND INCOME ACCOUNTS CA DEFICIT HAS NARROWED TO -4.4% OF GDP, SUPPORTED BY TOURISM AND TRANSPORT TOTAL FX INFLOWS INCREASED SLIGHTLY BY 2.3% Y-O-Y AND AMOUNTED TO US$ 3.0 SERVICES AND IMPROVING INCOME BALANCE BLN IN 1Q25 Goods, net Services
Slide 15: Diversification of external earnings enhances resilience
DIVERSIFICATION OF THE EXTERNAL EARNINGS ENHANCES RESILIENCE EXPORT OF SERVICES INCREASED TO US$ 7.7 BLN IN 2024 (+9% Y-O-Y), DUE TO THE EXPORTS AND RE-EXPORTS, US$ BILLION INCREASING TRAVEL AND TRANSPORT SERVICES Travel ICT services Transport Other services Services Export from BOP, bln USD Service
Slide 16: Trade diversified across countries, export concentration remains
WHILE TRADE HAS BECOME MORE DIVERSIFIED ACROSS COUNTRIES, EXPORT CONCENTRATION REMAINS EVIDENT, WITH MOTOR CARS ACCOUNTING FOR A SIGNIFICANT SHARE EXPORTS AND IMPORTS OF GOODS, Y-O-Y % EXTERNAL TRADE BY COUNTRIES, 1Q25, SHARE IN TOTAL 75% Imports, YoY % Exports, YoY % 75% Export 1.4 USD BLN Import 4
Slide 17: Tourism revenues increased, shift toward new markets
TOURISM REVENUES HAVE INCREASED SOMEWHAT, ACCOMPANIED BY A SHIFT TOWARD NEW MARKETS TOURISM REVENUES TO GDP INTERNATIONAL VISITORS BY COUNTRY Tourism revenues, US$ bln Tourism revenues, % of GDP Number of International Visitors in 1Q25, Thousand Recovery level in 1Q25 (% of 1Q2019 level) 5.0 19% 20%
Slide 18: NBG re-entered the FX market in March 2025
THE NBG RE-ENTERED THE FX MARKET IN MARCH 2025, PURCHASING US$ 102 MILLION TO ADD TO ITS FOREIGN EXCHANGE RESERVES THE NBG HAS KEPT MONETARY POLICY RATE STEADY AT 8.0% SINCE MAY 2024 INTERNATIONAL RESERVES 6,000 Official Reserve Assets, US$ mln Net Foreign Assets, US$ mln 14 5,000 International rese
Slide 19: Loans growth by currencies and sectors
0% 10% 20% 30% 40% 50% -10% 0% 5% 10% 15% 20% 25% Mar-17 Sep-18 Jun-17 Dec-18 Sep-17 Mar-19 Dec-17 Jun-19 Mar-18 Jun-18 Sep-19 Sep-18 Dec-19 LOANS BY CURRENCIES Dec-18 Mar-20 Legal Entities Mar-19 Jun-20 Georgia Capital PLC | Source: NBG Jun-19 Sep-20 Sep-19 Dec-20 Dec-19 Mar-20 Mar-21 GEL Loans, Yo
Slide 20: General government total debt lowest since 2014
GENERAL GOVERNMENT TOTAL DEBT (% OF GDP) LOWEST SINCE 2014 AMID SOLID GROWTH AND EXCHANGE RATE GAINS GENERAL GOVERNMENT TOTAL DEBT AT THE END OF 2024 AMOUNTED TO US$ 11.8 BN IN 2024, GENERAL GOVERNMENT DEBT AS A PERCENT OF GDP REACHED ITS LOWEST LEVEL (36% OF GDP) SINCE 2014 General Government Debt,