iFast Corporation Ltd’s Latest Earnings: What Investors Should Know

iFast Corporation Ltd  (SGX: AIY) released its fiscal second-quarter earnings report this morning. The reporting period was for 1 April 2015 to 30 June 2015.

iFast is an internet based investment products distribution platform which was listed late last year. Folks in Singapore may be familiar with its consumer facing platform, The business of iFast can be divided into two buckets: the B2C (business-to-consumer) division and the B2B (business-to-business) division.

You can learn more about iFast’s IPO (initial public offering) here.

Financial highlights

Here’s a quick take on the latest financial figures from iFast:

  1. For the second quarter of 2015, revenue for iFast was up by 21.9% on a year-on-year comparison, coming in at $23.2 million.
  2. After netting off commissions and fees, iFast reported net revenue of $11.4 million for the second quarter of 2015, a 26% increase from the same quarter a year ago. Of this amount, $9.4 million (or 82%) was recurring in nature.
  3. Profit for the period was up 24.6% year-on-year to $3.2 million.
  4. That said, earnings per share (EPS) was down 3% compared to the same quarter last year. iFast recorded 1.26 cents in EPS in the reporting quarter due to a higher share count.
  5. Moving on, cash flow from operations for the reporting quarter was $3.1 million with capital expenditures clocking in at just $313,000. The low capex gave iFast a positive free cash flow of $2.8 million. For perspective, the selfsame figures a year ago were $1.6 million, $252,000, and $1.35 million, respectively.
  6. As of 30 June 2015, iFast’s assets under administration (AUA) was S$5.7 billion, up 14.7% year-on-year. This is an important figure for investors to track given that iFast had mentioned in its IPO prospectus that “the size of our AUA is a good indicator of our net revenue.”
  7. As of 30 June 2015, the company had $24.6 million in cash and equivalents and no debt; that’s a strong balance sheet.

Overall, iFast continues to deliver results with the company hitting its stride as a publicly-listed entity. For the second quarter of 2015, iFast’s board of directors had proposed an interim dividend of 0.68 Singapore cents per share.

Operational highlights

At the end of the second quarter, iFast’s B2C business segment had recorded AUA of S$1.45 billion. Meanwhile, the B2B side clocked in AUA of S$4.26 billion. AUA from the B2B and B2C segments had grown by 15.7% and 12.2% year-on-year, respectively.

At the country level, Singapore’s net revenue grew by 28.7% from a year ago to $8.1 million. Elsewhere, Hong Kong and Malaysia had recorded respective net revenues of $2.7 million and $0.5 million.

In other news, iFast’s Singapore operations had received regulatory approval to distribute bonds and exchange traded funds. Beyond that, iFast has also entered into an agreement to acquire a stockbroking firm, Winfield Securities Limited, in Hong Kong.

Both developments may represent further growth opportunities in the future for the firm and investors can watch for signs of growth partly through changes in the firm’s AUA.

Foolish summary

At its opening price of $1.48 on Wednesday, iFast traded at around 36 times its trailing earnings.

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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Singapore contributor Chin Hui Leong doesn’t own shares in any companies mentioned.