iFAST Corporation Ltd’s Mixed Track Record In Growing Its Business

iFAST Corporation Ltd (SGX: AIY) is an Internet-based investment products distribution platform provider that has a business presence in Singapore, Hong Kong, Malaysia, China and India.

One of the things that I like to do when analysing a company is to study its track record. The past is no guarantee of the future. But historical information is the most reliable thing that we can use as our basis to forecast what lies ahead.

And this brings me to the main purpose of this article, which is to have a quick overview of IFAST’s historical business growth.

Bumpy growth

The table below is a snapshot of the company’s important financial metrics from 2013 2017:

Source: iFAST 2017 annual report

Here are a few points worth highlighting:

1. Firstly, iFAST’s revenue has grown by a cumulative 56% – or 11.8% per year – from 2013 to 2017.

2. Secondly, the company’s net profit growth is slower than its revenue growth in the period above. After increasing from S$7.9 million in 2013 to S$12.1 million in 2015, iFAST’s net profit fell hard in 2016, before recovering somewhat in 2017. But still, the company’s net profit in 2017 was 26% lower than in 2015. Cumulatively, the company’s net profit was up by 14% from 2013 to 2017.

3. Thirdly, the company’s EPS (earnings per share) has fluctuated between a low of 2.08 cents in 2016 to a high of 4.65 cents in 2015. Cumulatively, its EPS had declined by 12% in all from 2013 to 2017; iFAST held its IPO (initial public offering) in December 2014, and the listing increased the company’s share count.

4. Lastly, the company’s dividend per share has grown by a respectable 52% for the period under observation.

A Foolish conclusion

In summary, iFAST has shown strong growth in revenue and dividend over the last five years. But, its net profit has not managed to keep up, largely due to start-up losses in its young China business. Together with an increase in its share count from its IPO, its EPS declined in the same period.

Meanwhile, there are 28 surprising and important things we think every Singaporean investor should know—and we’ve laid them all out in The Motley Fool Singapore’s new e-book. Packed with information and insights, we believe this book will help you be a better, smarter investor. You can download the full e-book FREE of charge—simply click here now to claim your copy.

The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Singapore contributor Lawrence Nga doesn’t own shares in any companies mentioned. The Motley Fool Singapore has a recommendation on iFAST Corporation Ltd.