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Ayondo full-year loss balloons to 50.2m Swiss francs

CATALIST-listed fintech group Ayondo incurred a net loss of 50.2 million Swiss francs (S$67.2 million) for the financial year ended Dec 31, 2018, widening more than five times from a loss of 9.8 million francs a year earlier, it said on Thursday.

Ayondo had issued a profit warning on April 23, flagging a bigger net loss for FY2018 due to the impairment of certain intangible assets arising from poor financial performance.

In Thursday's earnings statement, it said the continued losses were due to poor business performance mainly as a result of unfavourable trading conditions arising from low volatility in financial markets and the tightening measures in contract for difference (CFD) markets from European and UK regulators in 2018. Lower marketing expenditure also meant that the Group could not replace trading clients following large drawdowns, it added.

Loss per share was 0.01 franc for FY2018, compared to 0.016 franc in the previous year.

Trading revenue edged up to 20.80 million francs from 20.76 million francs a year ago.

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This slight increase in revenue was despite an 8 per cent decrease in the total number of active clients to 47,298 from 51,606 in FY2017.

Average revenue per active client rose by 9 per cent to 440 francs for the full year, with increases in all segments.

Ayondo’s current liabilities exceeded its current assets by 8.26 million francs as at 31 Dec, 2018, and it was in a net liability position of 8.28 million francs as at end-2018.

Ayondo said that its unaudited results announcement for FY18 were prepared on the assumption that the group is able to continue as a going concern to the best of knowledge and belief of the directors.

The management said it is confident of successfully completing the proposed disposal of Ayondo’s 99.91 per cent-owned UK subsidiary Ayondo Markets Limited (AML) to BUX Holdings, thus significantly reducing the group’s liabilities.

On April 16, Singapore Exchange’s regulation unit instructed Ayondo to put on hold its plan to dispose of AML, pending clarity over the group’s financial situation as well as AML’s compliance with a UK authority.

Ayondo said on Thursday that it is also exploring other opportunities that could satisfy the going concern and business viability issues and will make an announcement when necessary.  It cautioned shareholders against placing undue reliance on its unaudited results for

The goodwill, capitalised software development costs and the investment in app developer MyHero were fully impaired in FY2018 due to the uncertainty surrounding the current future of Ayondo. Total impairment of asset amounted to 37.1 million francs.

The group faced working capital deficiency due to continued losses, which were a result of poor business performance.

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