iFast Q4 net profit falls 82% amid strategic investments, tough market conditions

FINTECH platform iFast Corporation posted an 82 per cent drop in net profit to S$1.3 million for its fourth quarter (Q4) ended Dec 31, 2022, from S$7.2 million a year earlier.

In a bourse filing on Tuesday (Feb 14), the group said that its profitability declined substantially in 2022 due to several factors, namely strategic investments it had made throughout the year, preparations for its Hong Kong ePension division, and impairment losses related to the exit from its onshore Indian platform business.

Earnings per share stood at 0.44 Singapore cent for the fourth quarter, down from 2.6 cents a year earlier.

Revenue for Q4 2022 fell 13 per cent to S$47.4 million, from S$54.6 million previously. iFast said that it faced “very tough financial market conditions globally” during the year.

As at Dec 31, the company’s assets under administration declined 8.3 per cent year on year to S$17.42 billion. iFast noted, however, that its net inflows of client assets – which it said was the most important indicator of its long-term growth potential – remained healthy at S$263 million in Q4, and S$2.1 billion in FY2022 overall.

A final dividend of 1.4 Singapore cents per share was proposed for FY2022, unchanged from the year before. The dividend will be paid on May 19, 2023, once it is approved by shareholders at the group’s annual general meeting on Apr 26.

For the full year ended Dec 31, 2022, net profit was down 79 per cent year on year to S$6.4 million; revenue was down 5 per cent to S$205.3 million.

Full-year net revenue, which is revenue earned by the group after deducting commission and fee expenses as well as interest expenses, rose 3.8 per cent year on year to S$118.2 million.

Meanwhile, iFast’s net revenue excluding its banking operations declined 3.4 per cent year on year to S$110.1 million, as a result of turbulent financial market conditions during the year.

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The company expects to enter a period of high growth in terms of revenue and profitability between 2023 and 2025, due to substantial contributions to come from its ePension division in Hong Kong as well as some initial tangible progress in its digital banking business.

Shares of iFast closed 0.6 per cent higher at S$5.43 on Tuesday, before the release of the results.