Ifast Corporation Ltd · SGX:AIY
Ifast — H1 2018 Earnings Presentation
64 slides from Ifast's earnings presentation, Jul 28, 2018
Slide 1: 2Q2018 & 1H2018 Results Presentation
2Q2018 & 1H2018 Results Presentation 28 July 2018 Wealth Management Fintech Platform - Scaling Up iFAST Corporation Ltd.
Slide 2: Disclaimer
Disclaimer This presentation should be read as an overview of iFAST Corporation Ltd.’s ("iFAST Corp" or together with its subsidiaries, the “Group”) current business activities and operating environment. This presentation should not be solely relied upon by current and potential investors when makin
Slide 3: Table of Contents
Table of Contents SECTION TITLE I Financial Results 2Q2018 (Apr - Jun 2018) and 1H2018 (Jan - Jun 2018) Results Financial Indicators Financial Position Interim Dividends II Building A Leading Asian Wealth Management Fintech Platform Opportunities For A Leading Wealth Management Fintech Pla
Slide 4: Key Summary
Key Summary • The Group’s Assets Under Administration (AUA) increased 22.2% YoY, reaching another record high of S$8.33 billion as at 30 Jun 2018, the eighth consecutive quarter of record AUA levels for the Group. • The record AUA has been achieved despite generally tough equity and bond market cond
Slide 5: Group AUA grew 22.2% YoY to record S$8.33 billion
Group AUA grew 22.2% YoY to record S$8.33 billion S$ million AUA (as at 30 Jun 2018): S$8.33 billion¹ $9,000 $8,000 $7,000 $6,000 $5,000 $4,000 $3,000 $2,000 $1,000 $- Dec-06 Dec-00 Dec-01 Dec-02 Dec-03 Dec-04 Dec-05 Dec-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 Dec-13 Dec-14 Dec-15 Dec-16 Dec-17 Jun-06
Slide 6: Fintech Vision 2028
Fintech Vision 2028 • The Company sees the financial eco-system undergoing rapid and tremendous changes in the next 10 years because of factors including Financial Technology (Fintech) innovation and regulations, and shifts in consumer behaviour • The Company believes it has the capabilities and lic
Slide 7: Fintech Vision 2028
Fintech Vision 2028 • The Company’s vision is to be a leading wealth management Fintech platform in Asia. The Management has decided to share the “Fintech Vision 2028” in greater details with the investor community because the Fintech opportunities are tangible and will only increase in the next dec
Slide 8: Financial Results
SECTION I: Financial Results PRIVATE & CONFIDENTIAL. NOT FOR EXTERNAL CIRCULATION. CO. REG. NO. R200007899C iFAST Corporation Ltd.
Slide 9: Presentation of Group’s Results
Presentation of Group’s Results Presentation of Group’s results (including and excluding China) • In view that our China operation is a relatively new market for the Group, we are presenting our presentation results based on the results of: (1) Group (Singapore, Hong Kong, Malaysia) excluding China
Slide 10: Financial Results for Group (excluding China operation) (2Q2018 vs 2Q2017)
Financial Results for Group (excluding China operation) (2Q2018 vs 2Q2017) YoY change S$ (Million) 2Q20171 2Q20172 2Q2018 (%) Revenue 24.56 24.56 30.65 +24.8 Net revenue 11.85 11.85 14.68 +23.9 Other income 0.43 0.31 0.27 -13.2 Expenses 8.60 8.60 10.61 +23.5 Net finance income 0.15 0.15 0.23 +52.0 S
Slide 11: Financial Results for Group (including China operation) (2Q2018 vs 2Q2017)
Financial Results for Group (including China operation) (2Q2018 vs 2Q2017) YoY change S$ (Million) 2Q20171 2Q20172 2Q2018 (%) Revenue 24.66 24.66 30.92 +25.4 Net revenue 11.95 11.95 14.96 +25.2 Other income 0.43 0.31 0.27 -13.2 Expenses 9.84 9.84 12.02 +22.1 Net finance income 0.16 0.16 0.25 +57.1 S
Slide 12: Financial Results for Group (excluding China operation) (1H2018 vs 1H2017)
Financial Results for Group (excluding China operation) (1H2018 vs 1H2017) YoY change S$ (Million) 1H20171 1H20172 1H2018 (%) Revenue 46.52 46.52 61.44 +32.1 Net revenue 22.96 22.96 28.89 +25.8 Other income 0.87 0.54 0.55 +1.8 Expenses 16.98 16.98 21.09 +24.2 Net finance income 0.34 0.35 0.44 +30.0
Slide 13: Financial Results for Group (including China operation) (1H2018 vs 1H2017)
Financial Results for Group (including China operation) (1H2018 vs 1H2017) YoY change S$ (Million) 1H20171 1H20172 1H2018 (%) Revenue 46.76 46.76 61.88 +32.3 Net revenue 23.12 23.12 29.33 +26.9 Other income 0.87 0.55 0.56 +1.8 Expenses 19.27 19.27 23.89 +24.0 Net finance income 0.35 0.35 0.47 +32.0
Slide 14: Results Overview for Group (excluding China operation)
Results Overview for Group (excluding China operation) S$ (Million) FY20141 FY2015 FY2016 FY2017 1H2018 Revenue 78.35 85.34 79.89 100.65 61.44 Net revenue 36.68 41.53 40.46 49.01 28.89 Other income 0.24 1.53 1.88 2.50 0.55 Operating expenses 25.62 30.06 33.13 37.40 21.09 Net finance income 0.10 0.75
Slide 15: Results Overview for Group (including China operation)
Results Overview for Group (including China operation) S$ (Million) FY20141 FY2015 FY2016 FY2017 1H2018 Revenue 78.35 85.34 80.60 101.17 61.88 Net revenue 36.68 41.53 40.69 49.45 29.33 Other income 0.24 1.53 1.88 2.50 0.56 Operating expenses 26.14 31.08 37.16 42.28 23.89 Net finance income 0.10 0.80
Slide 16: PBT margin for Group (based on net revenue)
PBT margin for Group (based on net revenue) (excluding China operation) (including China operation) 35% 35% 33.1% 31.1% 30.7% 29.5% 30.1% 29.6% 30% 30% 25% 24.3% 25% 21.8% 20.4% 20% 20% 15.0% 15% 15% 10% 10% 5% 5% 0% 0% 2014 2015 2016 2017 1H2018 2014 2015 2016 2017 1H2018 Notes: 1. PBT margins (201
Slide 17: Financial Indicators
Financial Indicators S$ (Million) FY2014 FY2015 FY2016 FY2017 1H2018 Operating 10.18 14.18 5.63 13.22 10.41 Cashflows Capital 2.34 5.45 6.61 7.47 4.16 Expenditure 31 Dec 31 Dec 31 Dec 31 Dec 30 Jun S$ (Million) 2014 2015 2016 2017 2018 Net Current 63.16 68.32 64.39 60.18 59.52 Assets 31 Dec 31 Dec 3
Slide 18: Cash position
Cash position As at 31 Dec 2017 As at 30 Jun 2018 (S$ million) (S$ million) Cash and cash equivalents 33.50 28.25 Other investments¹ 22.41 20.78 Total cash and other investments 55.91 49.03 Note: 1. Other investments comprise investments in financial assets under current assets 18
Slide 19: Number of issued shares
Number of issued shares As at 31 Dec 2017 As at 30 Jun 2018 Total number of issued shares 264,672,618 266,169,968 (excluding treasury shares) 19
Slide 20: Our Consolidated Financial Position as at 30 Jun 2018
Our Consolidated Financial Position as at 30 Jun 2018 S$’000 NON-CURRENT ASSETS Fixed Assets 3,266 Intangible Assets 14,264 Associates 2,348 Other Investments 3,952 Deferred Tax Assets 791 Prepayments & Others 274 TOTAL NON-CURRENT ASSETS 24,895 CURRENT ASSETS Trade & Other Receivables 29,332 Uncomp
Slide 21: Our Consolidated Financial Position as at 30 Jun 2018 (cont’d)
Our Consolidated Financial Position as at 30 Jun 2018 (cont’d) S$’000 CURRENT LIABILITIES Uncompleted contracts - sellers 22,898 Trade & Other Payables 18,723 Finance Lease 5 Current Tax Payable 1,457 TOTAL CURRENT LIABILITIES 43,083 NON-CURRENT LIABILITIES Deferred Tax 1,289 Finance Lease 11 TOTAL
Slide 22: Second Interim Dividend for FY2018
Second Interim Dividend for FY2018 Second Interim Dividend for FY2018 - Schedule Dividend per share 0.75 cents per ordinary share Ex-dividend date 3 Aug 2018 Record date and time 7 Aug 2018 (5.00 pm) Payment date 20 Aug 2018 • For the second interim dividend for 2Q2018, the Directors proposed a divi
Slide 23: Building A Leading Asian Wealth Management Fintech Platform
SECTION II: Building A Leading Asian Wealth Management Fintech Platform iFAST Corporation Ltd.
Slide 24: Opportunities For A Leading Wealth Management Fintech Platform
Opportunities For A Leading Wealth Management Fintech Platform • Within the mutual funds markets in Asia, the assets under management (“AUM”) size of authorised and recognised collective investment schemes in Singapore is at S$82 billion in 2016 (Source: MAS Singapore Asset Management Survey 20161)
Slide 25: Factors Driving Adoption Of A Wealth Management Fintech Platform
Factors Driving Adoption Of A Wealth Management Fintech Platform • The Business-to-Consumer (B2C) – the increasing pool of DIY (do- it-yourself) investors • The Business-to-Business (B2B) segment – Growth of the FA industry (IFAs, EAMs) – Adoptions by securities firms, insurance companies, banks • I
Slide 26: Factors Driving Adoption Of A Wealth Management Fintech Platform
Factors Driving Adoption Of A Wealth Management Fintech Platform • Convergence driving demand for integrated platforms – Life insurance industry, unit trust industry and stockbroking industry are all aiming to serve the investments and long- term savings needs of the consumers – Historically seen as
Slide 27: Ecosystem Required For A Successful Wealth Management Fintech Platform
Ecosystem Required For A Successful Wealth Management Fintech Platform • For Fintech platform to be successful, pre-requisites include: – Regulatory licences (capital markets licences including dealing, custodian and fund management) – A strong ecosystem that encompasses capabilities in both the B2C
Slide 28: iFAST Fintech Ecosystem
iFAST Fintech Ecosystem Connecting All to Help Investors Invest Globally and Profitably Fund Houses Fundsupermart.com / FSMOne.com / Holds relevant B2C Bondsupermart licences in 5 markets Banks/ Over Bond Dealers 290,000 customer FA Companies accounts in 5 Markets Over 320 companies, and Stock Finan
Slide 29: The iFAST Fintech Ecosystem
The iFAST Fintech Ecosystem • Products and services: – Unit trusts (over 5,500 funds from 230 fund houses) – Bonds (over 1,000 direct bonds) – Stocks & ETFs – in 3 markets (Singapore, Hong Kong and US) – Discretionary portfolio management services • Over 320 financial institutions and other corporat
Slide 30: The Revenue Drivers
The Revenue Drivers • The iFAST business model predominantly involves growing the size of our assets under administration (AUA). Higher AUA will generally lead to higher revenues. • Recurring income accounts for over 80% of our net revenue • Sources of Non-Recurring Net Revenue – Transaction fees –
Slide 31: Net revenue breakdown between recurring and non-recurring sources
Net revenue breakdown between recurring and non-recurring sources Average contribution from recurring net revenue as opposed to non-recurring net revenue in the S$ million period from 2013 to 1H2018 was 82.3% 60 50 8.5 40 6.9 6.0 7.2 30 6.0 5.6 4.0 4.8 20 18.1 4.6 40.9 12.3 34.6 34.7 4.0 29.5 25.6 2
Slide 32: Group AUA grew 22.2% YoY to record S$8.33 billion
Group AUA grew 22.2% YoY to record S$8.33 billion S$ million AUA (as at 30 Jun 2018): S$8.33 billion¹ $9,000 $8,000 $7,000 $6,000 $5,000 $4,000 $3,000 $2,000 $1,000 $- Dec-06 Dec-00 Dec-01 Dec-02 Dec-03 Dec-04 Dec-05 Dec-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 Dec-13 Dec-14 Dec-15 Dec-16 Dec-17 Jun-06
Slide 33: Net revenue as a ratio of average AUA
Net revenue as a ratio of average AUA 0.800% 0.700% 0.122% 0.126% 0.144% 0.105% 0.140% 0.600% 0.500% 0.400% 0.300% 0.591% 0.615% 0.609% 0.606% 0.590% 0.200% 0.100% 0.000% 2014 2015 2016 2017 1H2018 Recurring net revenue / AUA Non-recurring net revenue / AUA 33
Slide 34: Pursuing A Virtual Banking Licence in Hong Kong
Pursuing A Virtual Banking Licence in Hong Kong • We believe that the Group currently has quite a comprehensive wealth management Fintech platform that will meet the needs of a broad section of customers. However, the ability to provide some basic banking services such as deposit taking and lending
Slide 35: Pursuing A Virtual Banking Licence in Hong Kong
Pursuing A Virtual Banking Licence in Hong Kong • We believe that the iFAST Fintech Ecosystem is an established ecosystem that will allow the Group to potentially operate successfully as a Virtual Bank in Hong Kong, if given the opportunity • We believe that if the Group is able to obtain a Virtual
Slide 36: Vision 2028 – 10 Year Target
Vision 2028 – 10 Year Target • We have set a 10-year target of achieving S$100 billion in Group AUA by 2028* – This works out to a compound annual growth rate (CAGR) of 28% • For Singapore, our key market currently, we have set a 10-year target of AUA S$35 billion* – This works out to a CAGR of 20%
Slide 37: Our Performance Trends
SECTION III: Our Performance Trends iFAST Corporation Ltd.
Slide 38: AUA Breakdown: Markets & Products
AUA Breakdown: Markets & Products AUA Breakdown By Markets AUA Breakdown by Products 2.2% 3.2% 4.1% 7.6% 6.2% 24.0% 66.2% 86.5% Singapore Hong Kong Malaysia Others (China & India) Unit Trusts Bonds Stocks & ETFs Cash Account
Slide 39: Net sales & Subscription ex-switching
Net sales & Subscription ex-switching S$ million Net Sales S$ million Subscription ex-switching $1,000 $3,000 $942 $900 $2,570 $2,500 $800 $2,210 $700 $2,000 $600 $568 $1,670 $1,547 $1,574 $501 $500 $1,500 $419 $396 $1,193 $400 $1,000 $300 $235 $200 $500 $100 $- $- 2014 2015 2016 2017 1H17 1H18 2014
Slide 40: Recurring and Non-Recurring Net Revenue
Recurring and Non-Recurring Net Revenue S$ (Million) FY2014 FY2015 FY2016 FY2017 1H2018 Recurring net revenue 29.48 34.64 34.71 40.95 23.71 Non-recurring net revenue 7.20 6.89 5.98 8.50 5.62 Total net revenue 36.68 41.53 40.69 49.45 29.33 YoY Change (%) FY2014 FY2015 FY2016 FY2017 1H2018 Recurring n
Slide 41: Net Revenue – Geographical Segment
Net Revenue – Geographical Segment S$ (Million) FY2014 FY2015 FY2016 FY2017 1H2018 Singapore 25.72 30.04 29.54 34.77 19.62 Hong Kong 9.48 9.55 8.66 10.78 7.05 Malaysia 1.48 1.94 2.26 3.47 2.22 China - - 0.23 0.43 0.44 Group 36.68 41.53 40.69 49.45 29.33 YoY Change (%) FY2014 FY2015 FY2016 FY2017 1H2
Slide 42: Net Revenue – B2B Business Segment
Net Revenue – B2B Business Segment B2B Net Revenue FY2014 FY2015 FY2016 FY2017 1H2018 (S$ Million) Recurring net revenue 21.09 24.50 24.49 28.85 16.59 Non-recurring net revenue 4.46 4.09 3.86 5.15 3.37 Total B2B net revenue 25.55 28.59 28.35 34.00 19.96 YoY Change (%) FY2014 FY2015 FY2016 FY2017 1H2
Slide 43: Net Revenue – B2C Business Segment
Net Revenue – B2C Business Segment B2C Net Revenue FY2014 FY2015 FY2016 FY2017 1H2018 (S$ Million) Recurring net revenue 8.39 10.15 10.22 12.10 7.12 Non-recurring net revenue 2.74 2.79 2.12 3.35 2.25 Total B2C net revenue 11.13 12.94 12.34 15.45 9.37 YoY Change (%) FY2014 FY2015 FY2016 FY2017 1H2018
Slide 44: Profit/Loss – Geographical Segment
Profit/Loss – Geographical Segment YoY YoY Profit/Loss Change Change (S$ Million) 2Q20171 2Q2018 (%) 1H20171 1H2018 (%) Singapore 2.87 3.21 +11.7 5.65 6.22 +10.0 Hong Kong 0.53 1.00 +86.9 0.66 1.81 +176.0 Malaysia 0.31 0.36 +16.6 0.56 0.76 +34.3 Other2 (0.11) (0.06) -45.1 (0.24) (0.09) -63.1 Profit
Slide 45: Profit/Loss – Geographical Segment
Profit/Loss – Geographical Segment Profit/Loss (S$ Million) FY2014 FY2015 FY2016 FY2017 1H2018 Singapore 9.371 11.82 9.07 11.91 6.22 Hong Kong 2.10 1.65 0.53 1.82 1.81 Malaysia (0.04)3 0.28 0.38 1.07 0.76 Other2 (0.01) (0.02) (0.16) (0.33) (0.09) Profit before tax (excluding China operation) 11.42 1
Slide 46: Net revenue and operating expenses as a ratio of average AUA (excluding China)
Net revenue and operating expenses as a ratio of average AUA for Group (excluding China operation) 0.800% 0.735% 0.738% 0.729% 0.730% 0.711% 0.700% 0.615% 0.607% 0.606% 0.591% 0.582% 0.594% 0.600% 0.556% 0.534% 0.533% 0.513% 0.500% 0.400% 0.300% 0.200% 0.100% 0.000% 2014 2015 2016 2017 1H2018 Net re
Slide 47: Net revenue and operating expenses as a ratio of average AUA (including China)
Net revenue and operating expenses as a ratio of average AUA for Group (including China operation) 0.800% 0.735% 0.738% 0.732% 0.730% 0.714% 0.700% 0.652% 0.615% 0.625% 0.609% 0.606% 0.591% 0.590% 0.594% 0.600% 0.552% 0.524% 0.500% 0.400% 0.300% 0.200% 0.100% 0.000% 2014 2015 2016 2017 1H2018 Net re
Slide 48: Progress of Individual Markets
Progress of Individual Markets Singapore • AUA of the Singapore operation grew 16.5% YoY, reaching S$5.51 billion as at 30 June 2018 • Net revenue grew 19.8% YoY to S$19.62 million in 1H2018, while net profit before tax grew 10.0% YoY to S$6.22 million in 1H2018 • Global markets were generally volat
Slide 49: Progress of Individual Markets
Progress of Individual Markets Singapore • The activities carried out in 1H2018 included seminars touching on a wide range of topics across all product categories to give clients a better understanding of the opportunities and risks in the global markets • The B2B division also continued its efforts
Slide 50: Progress of Individual Markets
Progress of Individual Markets Hong Kong • Hong Kong’s AUA grew 32.4% YoY to S$2.00 billion as at 30 Jun 2018 • Net revenue increased 40.3% YoY to S$7.05 million and net profit before tax improved 176.0% to S$1.81 million in 1H2018 • Though market sentiment was subdued in 2Q2018, there were customer
Slide 51: Progress of Individual Markets
Progress of Individual Markets Malaysia • Malaysia’s AUA grew 35.4% YoY to hit S$630 million as at 30 Jun 2018 • Net revenue grew 42.6% YoY to S$2.22 million and net profit before tax grew by 34.3% YoY to S$0.76 million in 1H2018 • With volatile market conditions in 2Q2018 and poor investors sentime
Slide 52: Progress of Individual Markets
Progress of Individual Markets China • China’s AUA grew 140.5% YoY to RMB 446 million as at 30 Jun 2018; however, AUA in 2Q2018 was lower compared to 1Q2018 due to a redemption by a single institutional client • Benefitting from increasing growth in both the onshore and offshore Chinese segments ove
Slide 53: Progress of Individual Markets
Progress of Individual Markets China • The Group noted that China regulators continued to tighten financial regulations in 2Q2018, however the Group remains well-positioned to benefit from such financial regulations changes in the markets • With more than 50 failures in peer-to-peer (P2P) lending pl
Slide 54: Progress of Individual Markets
Progress of Individual Markets India • As at 30 Jun 2018, iFAST Corp holds an effective 19.2% share of iFAST Financial India Pvt Ltd, the key business of the India business • iFAST Financial India Pvt Ltd is an India-incorporated company engaged in the distribution of investment products including m
Slide 55: Appendices
SECTION IV: Appendices iFAST Corporation Ltd.
Slide 56: Business Overview
Business Overview • iFAST Corporation Ltd. is a wealth management fintech platform with assets under administration (AUA) of S$8.33 billion as at 30 Jun 2018 (stock code: AIY) • Main business divisions: – Business-to-Consumer (B2C) platform, Fundsupermart (including its new FSMOne multi- products ac
Slide 57: Milestones
Milestones 2000 2008 2014 Launch of Fundsupermart.com (B2C) • Launch of iFAST Platform Services • Incorporation of iFAST Platform in Singapore (B2B) in Hong Kong Services (Shenzhen) Qianhai in China • Launch of Fundsupermart.com • Listing on SGX-ST 2002 (B2C) and iFAST Platform Services Launch of iF
Slide 58: Milestones (cont’d)
Milestones (cont’d) 2016 2017 2018 • Acquisition of a stockbroking • Launch of Stocks & ETFs on FSM • Hong Kong: iFAST Platform Services (HK) company and an insurance brokerage Hong Kong Limited awarded Internet Finance Award 2017 firm in Hong Kong • Launch of Bonds on FSM Malaysia Bronze prize in t
Slide 59: iFAST’s Fintech Footprint: Past and Present
iFAST’s Fintech Footprint: Past and Present PAST: Building the Foundation (2000-2013) PRESENT: Stepping Up the Game (2014-2018) Focus on building Fintech capabilities in- Focus on broadening the range and depth of house to efficiently and effectively deliver investment products and asset classes ava
Slide 60: Licences Held and Products and Services Available (as at end Jun 2018)
Licences Held and Products and Services Available (as at end Jun 2018) • Fund Distributor Qualification [CSRC] • Associate Member of AMAC • Member of SAMC Products available: UT • Registered Investment Adviser with the Securities and Exchange Board of India • Association of Mutual Funds in India (AM
Slide 61: 1H2018 Activities
1H2018 Activities (L-R) What and Where to Invest 2018 (Hong Kong); What and Where to Invest 2018 (Malaysia KL & Penang) (L-R) FSM Invest Expo (Singapore); Annual General Meeting & Pre-AGM Business Update (Singapore); (L-R) iWALK; SGX My First Stock Carnival 2018 (Singapore); Singapore Book Fair 《自学成
Slide 62: Our Value Proposition
Our Value Proposition PRODUCT B2B B2C PROVIDERS CUSTOMERS DIY INVESTORS • One platform, multiple • One platform, multiple investment • One platform, multiple B2C and B2B customers products investment products • No need to enter into • Adoption of recurring revenue business • Competitive and transpar
Slide 63: Fees Illustration
Fees Illustration FUND HOUSES TRAILER FEE PLATFORM FEE PLATFORM FEE B2B CUSTOMERS UPFRONT FEE B2C CUSTOMERS UPFRONT FEE WRAP FEE FX CONVERSION FEES B2B FINANCIAL ADVISORY COMPANIES FINTECH SOLUTIONS OTHER SERVICE FEES FACILITIES 63
Slide 64: Thank you.
Thank you. For more information, Please visit www.ifastcorp.com PRIVATE AND CONFIDENTIAL. NOT FOR EXTERNAL CIRCULATION. CO. REG. NO. R200007899C