iFast Corp's Q3 net profit rises 29.5% to S$2.6m

IFAST Corporation (iFast Corp) has shrugged off volatile market conditions and its loss-making China business to post a higher net profit of S$2.6 million in its third quarter, 29.5 per cent higher than the year-ago period.

Earnings per share for the mainboard-listed wealth management fintech platform increased to 0.98 Singapore cent from a restated 0.76 Singapore cent for the three months ended Sept 30.

Revenue rose 19.6 per cent to S$31.4 million from the previous year. iFast Corp credited this to the growth in the group's business and asset under administration (AUA) for its business-to-consumer and business-to-business divisions. AUA had swelled 18.7 per cent year-on-year to reach a new high of S$8.50 billion as at Sept 30.

Singapore, which contributes the lion's share of revenue, saw revenue grow 11.9 per cent in the third quarter, mostly thanks to stronger investment trading volumes in exchange-traded funds (ETFs) and stocks and subscription of investment in unit trusts. 

Stock and ETF transactions in have also risen in recent quarters in Hong Kong, where revenues jumped 41.4 per cent in the quarter.

In Malaysia, its bonds and discretionary portfolio management service grew significantly this year, although it also saw a slight slowdown in its unit trust business growth amid volatile market conditions and poor investors' sentiment in recent quarters. Revenue there grew 38.1 per cent year-on-year in the quarter.

But iFast Corp's  Chinese business in the third quarter saw losses widen by 24.4 per cent year-on-year to S$1.28 million.

"(The) China operation is continuing to build iFAST brand and business in this new market," the company said. 

"Poor market sentiment" in recent quarters from "the combined effects of weak performance in the China equity market due to escalating tensions over trade wars between the US and China and some failures in peer-to-peer lending platforms" also weighed down its Chinese performance, it said. 

The group said that it expects its  overall business performance in 2018 to post a "healthy improvement" over 2017, but the Chinese operation is expected to come in a slightly higher loss this year. 

The group has also been working towards a structure that could, in the medium to long term, have  its Hong Kong and China businesses  organised as a separate and standalone listed subsidiary.  The group said it expects this to "strengthen the overall capital base of the group". 

iFast Corp has also applied for a virtual banking licence in Hong Kong.

A third interim dividend of 0.75 cent per share has been proposed for the quarter, same as last year.

iFast Corp shares ended S$0.01, or 0.9 per cent, down at S$1.12 on Friday.