iFast Corporation Ltd’s Latest Earnings Report: Revenue Bounces Back Up

iFast Corporation Ltd  (SGX: AIY) reported its third-quarter earnings results this morning. The reporting period was for 1 July 2016 to 30 September 2016.

As a quick background, iFast is an internet-based investment products distribution platform which got listed in late 2014. Folks in Singapore may be familiar with its consumer facing product: 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 the company here or catch up with the results from the previous quarter here.

Financial highlights

The following’s a quick rundown on some of the latest financial figures for iFast:

  1. For 2016’s third-quarter, iFast’s revenue rose 2.3% year-on-year to $21.0 million.
  2. On a net revenue basis (net of commissions and fees), iFast reported $10.68 million, a 5.3% increase from the same quarter in 2015.
  3. But, profit for the reporting period plunged 35.3% to $1.91 million.
  4. Earnings per share (EPS) for the reporting quarter declined over 35%, falling from 1.10 cents in the third-quarter last year to 0.71 cents in the reporting quarter.
  5. iFast recorded cash flow from operations of $1.35 million for the reporting quarter. Capital expenditure was $364,000 for the same period. The lower capital expenditure gave iFast positive free cash flow of around $1 million for the third-quarter of 2016. This is down from the $3.45 million seen a year ago.
  6. As of 30 September 2016, assets under administration (AUA) was S$6 billion. This is up 10.8% year-on-year.
  7. The company also reported $24.8 million in cash and equivalents and $24,000 in debt (in financing lease liabilities), as of 30 September 2016. This is a slight decline from the $23.8 million in cash and equivalents and no debt recorded at the end of September 2015.

To sum up the reporting quarter, iFast’s revenue bounced back from the previous quarter’s decline. But its profit is down a hefty 35.3% year-on-year. The investment products platform provider maintains a strong balance sheet and recorded free cash flow as well. The financial strength provides the company options for its future.

iFast’s board of directors proposed an interim dividend of 0.68 cents per share, unchanged from the year before.

Operational highlights

At the country level, Singapore’s net revenue grew by 9.2% year-on -year to $7.74 million for the third-quarter of 2016. Elsewhere, Hong Kong and Malaysia recorded net revenue of $2.26 million and $0.63 million, respectively. Hong Kong’s revenue had dropped by almost a quarter from a year ago.

In terms of net profit, Singapore dropped by 7.6% to end the quarter at $2.6 million. Hong Kong and Malaysia recorded $275,000 and $137,000 in net profit respectively.

At its opening share price of $0.82 today, iFast traded at 29 times trailing earnings and a trailing dividend yield of 3.3%.

To keep up with the latest financial and stock market news, sign up now for a FREE subscription to The Motley Fool's weekly investing newsletter, Take Stock Singapore. It contains investing tips and tricks, and teaches you how you can grow your wealth in the years ahead.

Like us on Facebook to follow our latest hot articles. The Motley Fool's purpose is to help the world invest, better.

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.