Ifast Corporation Ltd · SGX:AIY
Ifast — H1 2020 Earnings Presentation
59 slides from Ifast's earnings presentation, Jul 23, 2020
Slide 1: 2Q2020 & 1H2020 Results Presentation
23 JULY 2020 2Q2020 & 1H2020 Results Presentation iFAST Corporation Ltd.
Slide 2: Disclaimer
Disclaimer This presentation should be read as an overview of iFAST Corporation Ltd.’s (“iFAST Corp” or the “Company”, and together with its subsidiaries, the “Group”) current business activities and operating environment. This presentation should not be solely relied upon by current and potential i
Slide 3: Table of Contents
Table of Contents o Key Summary Pg. 4 o Beneficiary of Increased Digital Adoption in the Wealth Management Industry o 2Q2020 (Apr–Jun 2020) & 1H2020 (Jan–Jun 2020) Results Pg. 9 Section I o Financial Indicators Financial Results o Interim Dividend o AUA Breakdown: Markets & Products Pg. 24 Section I
Slide 4: Key Summary
Key Summary • The Group reported a record quarterly net profit of S$4.53 million in 2Q2020, an increase of 84.7% compared to 2Q2019. This was achieved on the back of a 21.2% year-on-year (YoY) increase in net revenue, and a 25.8% YoY increase in gross revenue. For 1H2020, the Group’s net profit grew
Slide 5: Beneficiary of Increased Digital Adoption in the Wealth Management Industry
Beneficiary of Increased Digital Adoption in the Wealth Management Industry • The wealth management industry is undergoing rapid change driven by the acceleration in digital adoption and transformation in recent times. • As a leading Fintech wealth management platform in Asia, the increase in the pa
Slide 6: Group AUA grew 11.5% YTD and 23.4% YoY to S$11.15 billion
Group AUA grew 11.5% YTD and 23.4% YoY to S$11.15 billion as at 30 June 2020 S$ million AUA (as at 30 Jun 2020): S$11.15 billion1 $12,000 $11,000 $10,000 $9,000 $8,000 $7,000 $6,000 $5,000 $4,000 $3,000 $2,000 $1,000 $- Jun-17 Jun-01 Jun-02 Jun-03 Jun-04 Jun-05 Jun-06 Jun-07 Jun-08 Jun-09 Jun-10 Dec
Slide 7: Net inflows & Subscription ex-switching
Net inflows & Subscription ex-switching S$ million Net inflows S$ million Subscription ex-switching $1,400 $5,000 $1,247 $4,618 $4,328 $1,200 $4,500 $4,000 $1,000 $976 $3,605 $942 $3,500 $786 $800 $3,000 $2,453 $2,500 $600 $2,000 $1,798 $1,574 $400 $360 $1,500 $235 $1,000 $200 $500 $- 2016 2017 2018
Slide 8: iFAST Singapore Total Sales ex-switching
iFAST Singapore Total Sales ex-switching S$ million 1,300 1,200 1,100 1,000 900 800 700 600 500 400 300 200 100 - B2B B2C iFAST Corporation Ltd.
Slide 9: Financial Results
SECTION I Financial Results iFAST Corporation Ltd. 9
Slide 10: Financial Results for Group (2Q2020 vs 2Q2019)
Financial Results for Group (2Q2020 vs 2Q2019) S$ (Million) 2Q2019 2Q2020 YoY change (%) Revenue 30.64 38.55 +25.8 Net revenue 16.38 19.84 +21.2 Other income 0.47 1.82 +285.8 Expenses 13.89 15.89 +14.4 Net finance income / (costs) 0.02 -0.02 NM Share of results of associates, net of tax -0.11 -1 -97
Slide 11: Financial Results for Group (1H2020 vs 1H2019)
Financial Results for Group (1H2020 vs 1H2019) S$ (Million) 1H2019 1H2020 YoY change (%) Revenue 57.83 77.03 +33.2 Net revenue 31.39 38.66 +23.1 Other income 1.08 2.38 +119.6 Expenses 27.36 30.99 +13.3 Net finance (costs) / income -0.13 0.14 NM Share of results of associates, net of tax -0.25 -0.07
Slide 12: Results Overview for Group (including China operation)
Results Overview for Group (including China operation) S$ (Million) FY2016 FY20171 FY2018 FY2019 1H2020 Revenue 80.60 101.17 121.24 125.41 77.03 Net revenue 40.69 49.45 59.62 65.20 38.66 Other income 1.88 1.08 1.16 2.04 2.38 Operating expenses 37.16 42.19 49.78 56.06 30.99 Net finance income/(costs)
Slide 13: Results Overview for Group (excluding China operation)
Results Overview for Group (excluding China operation) S$ (Million) FY2016 FY20171 FY2018 FY2019 1H2020 Revenue 79.89 100.65 120.50 124.84 76.49 Net revenue 40.46 49.01 58.87 64.64 38.13 Other income 1.88 1.10 1.16 2.04 2.38 Operating expenses 33.13 37.31 44.12 50.43 28.06 Net finance income/(costs)
Slide 14: PBT margin for Group (based on net revenue)
PBT margin for Group (based on net revenue) (including China operation) (excluding China operation) 35.0% 35.0% 32.8% 30.0% 30.0% 29.2% 26.2% 26.8% 24.3% 24.9% 25.0% 25.0% 20.7% 20.0% 20.0% 17.7% 17.0% 15.0% 15.0% 15.0% 10.0% 10.0% 5.0% 5.0% 0.0% 0.0% 2016 2017 2018 2019 1H2020 2016 2017 2018 2019 1
Slide 15: Financial Indicators
Financial Indicators S$ (Million) FY2016 FY2017 FY2018 FY2019 1H2020 EBITA 7.59 12.96 16.44 17.49 13.71 Net Cash Position1 54.59 55.91 48.06 40.15 42.45 Operating Cash Flows 5.63 13.22 17.62 19.38 19.50 Operating Cash Flows (excluding China 8.79 16.92 21.62 23.54 21.40 Operation) Capital Expenditure
Slide 16: Net Cash Position
Net Cash Position As at 30 Jun 2020 (S$ million) Cash and cash equivalents 26.00 Other investments¹ 20.29 Total cash and other investments 46.29 Less: Bank loans 3.84 Net Cash Position 42.45 (total cash and other investments net off bank loans) Gross Debt-to-Equity Ratio 4.03% Net Debt-to-Equity Rat
Slide 17: Group Operating Cash Flows
Group Operating Cash Flows S$ million 25 23.54 21.62 21.40 19.38 19.50 20 17.62 16.92 15 13.22 10 8.79 5.63 5 0 2016 2017 2018 2019 1H2020 Operating Cash Flows (excluding China) Operating Cash Flows (including China) iFAST Corporation Ltd. 17
Slide 18: Capital Expenditure
Capital Expenditure S$ thousand 14,000 11,901 12,000 10,727 10,000 7,466 8,000 6,615 6,000 5,454 5,062 4,000 2,339 1,714 1,554 2,000 214 - 2011 2012 2013 2014 2015 2016 2017 2018 2019 1H2020 Note: 1. The Group’s estimated capital expenditure for 2020 was S$10.81 million, but does not take into consi
Slide 19: Update on Operating Expenses
Update on Operating Expenses • At the beginning of this year, the Group guided that its operating expenses will amount to approximately between S$59.9 million to S$61.4 million in 2020. • Given the strong performance of the Group in 1H2020 and the positive underlying trends that the Group is current
Slide 20: Number of issued shares
Number of issued shares As at 31 Dec 2019 As at 30 Jun 2020 Total number of issued shares (excluding treasury shares and 268,732,479 271,155,107 subsidiary holdings) iFAST Corporation Ltd. 20
Slide 21: Our Consolidated Financial Position
Our Consolidated Financial Position As at 31 Dec 19 As at 30 Jun 20 S$’000 S$’000 NON-CURRENT ASSETS Plant and Equipment 3,689 3,508 Right-of-use Assets 14,390 21,259 Intangible Assets and Goodwill 22,212 23,442 Associates 5,375 6,005 Other Investments 5,329 5,210 Deferred Tax Assets 1,139 1,002 Pre
Slide 22: Our Consolidated Financial Position
Our Consolidated Financial Position As at 31 Dec 19 As at 30 Jun 20 S$’000 S$’000 EQUITY Share Capital 66,180 66,358 Other Reserves 23,877 29,009 EQUITY ATTRIBUTABLE TO OWNERS OF THE COMPANY 90,057 95,367 Non-Controlling Interests (421) (513) TOTAL EQUITY 89,636 94,854 NON-CURRENT LIABILITIES Deferr
Slide 23: Second Interim Dividend for FY2020
Second Interim Dividend for FY2020 Second Interim Dividend for FY2020 - Schedule Dividend per share 0.75 cents per ordinary share Ex-dividend date 3 Aug 2020 Record date and time 4 Aug 2020 (5.00 pm) Payment date 19 Aug 2020 • For the second interim dividend for 2Q2020, the Directors declared a divi
Slide 24: Our Performance Trends
SECTION II Our Performance Trends iFAST Corporation Ltd. 24
Slide 25: AUA Breakdown: Markets & Products
AUA Breakdown: Markets & Products (as at 30 June 2020) AUA Breakdown By Markets Breakdown by Products 3.0% 8.9% 5.7% 9.5% 7.2% 21.1% 67.0% 77.6% Singapore Hong Kong Unit Trusts Bonds Malaysia Others (China & India) Stocks & ETFs Cash Account iFAST Corporation Ltd. 25
Slide 26: Net revenue breakdown between recurring and non-recurring sources
Net revenue breakdown between recurring and non-recurring sources Average contribution from recurring net revenue as opposed to non-recurring net revenue in the period from 2019 to 1H2020 was 76.6% S$ million 70 60 12.3 11.3 50 8.5 40 6.9 6.0 7.2 10.8 30 6.0 52.9 4.0 48.3 4.8 20 18.1 4.6 40.9 12.3 3
Slide 27: Net revenue as a ratio of average AUA
Net revenue as a ratio of average AUA 0.800% 0.700% 0.105% 0.126% 0.139% 0.138% 0.214% 0.600% 0.500% 0.400% 0.300% 0.609% 0.606% 0.596% 0.594% 0.551% 0.200% 0.100% 0.000% 2016 2017 2018 2019 1H2020 Recurring net revenue / AUA Non-recurring net revenue / AUA iFAST Corporation Ltd. 27
Slide 28: Recurring and Non-Recurring Net Revenue
Recurring and Non-Recurring Net Revenue S$ (Million) FY2016 FY2017 FY2018 FY2019 1H2020 Recurring net revenue 34.71 40.95 48.32 52.94 27.85 Non-recurring net 5.98 8.50 11.30 12.26 10.81 revenue Total net revenue 40.69 49.45 59.62 65.20 38.66 YoY Change (%) FY2016 FY2017 FY2018 FY2019 1H2020 Recurrin
Slide 29: Net Revenue – Geographical Segment
Net Revenue – Geographical Segment S$ (Million) FY2016 FY2017 FY2018 FY2019 1H2020 Singapore 29.54 34.77 39.30 41.95 25.09 Hong Kong 8.66 10.78 14.26 16.71 9.18 Malaysia 2.26 3.47 5.32 5.97 3.86 China 0.23 0.43 0.75 0.57 0.53 Group 40.69 49.45 59.62 65.20 38.66 YoY Change (%) FY2016 FY2017 FY2018 FY
Slide 30: Net Revenue – B2B Business Segment
Net Revenue – B2B Business Segment B2B Net Revenue FY2016 FY2017 FY2018 FY2019 1H2020 (S$ Million) Recurring net revenue 24.49 28.85 33.88 37.12 19.54 Non-recurring net revenue 3.86 5.15 7.22 7.19 4.99 Total B2B net revenue 28.35 34.00 41.10 44.31 24.53 YoY Change (%) FY2016 FY2017 FY2018 FY2019 1H2
Slide 31: Net Revenue – B2C Business Segment
Net Revenue – B2C Business Segment B2C Net Revenue FY2016 FY2017 FY2018 FY2019 1H2020 (S$ Million) Recurring net revenue 10.22 12.10 14.44 15.81 8.31 Non-recurring net revenue 2.12 3.35 4.08 5.08 5.82 Total B2C net revenue 12.34 15.45 18.52 20.89 14.13 YoY Change (%) FY2016 FY2017 FY2018 FY2019 1H20
Slide 32: Profit/Loss – Geographical Segment
Profit/Loss – Geographical Segment YoY YoY Profit/Loss Change Change (S$ Million) 2Q2019 2Q2020 (%) 1H2019 1H2020 (%) Singapore 3.01 5.03 +67.2 5.01 8.55 +70.7 Hong Kong 0.84 0.86 +2.3 1.52 2.44 +60.7 Malaysia 0.41 1.11 +167.6 0.93 1.59 +71.0 Other1 (0.11) -2 -97.3 (0.25) (0.07) -70.0 Profit before
Slide 33: Profit/Loss – Geographical Segment
Profit/Loss – Geographical Segment Profit/Loss (S$ Million) FY2016 FY20172 FY2018 FY2019 1H2020 Singapore 9.07 10.62 11.86 9.96 8.55 Hong Kong 0.53 1.77 3.42 4.42 2.44 Malaysia 0.38 1.07 1.37 1.76 1.59 Other1 (0.16) (0.33) 0.52 (0.05) (0.07) Profit before tax (excluding China operation) 9.82 13.13 1
Slide 34: Transaction Volume Of Bondsupermart’s Affiliated Brokers From Inception
Transaction Volume Of Bondsupermart’s Affiliated Brokers From Inception S$ million 700.00 612.30 600.00 516.78 500.00 400.00 353.47 334.72 300.00 249.72 262.60 229.80 184.09 200.00 100.00 29.92 13.38 0.00 2012 2013 2014 2015 2016 2017 2018 2019 1H19 1H20 iFAST Corporation Ltd. 34
Slide 35: Update on Digital Bank Licence Application in Singapore
Update on Digital Bank Licence Application in Singapore • The iFAST-led consortium is among the nine digital wholesale bank (DWB) applicants that have met the eligibility criteria required to progress to the next stage of assessment. • In the announcement released on 18 June 2020, the Monetary Autho
Slide 36: Update on Digital Bank Licence Application in Singapore
Update on Digital Bank Licence Application in Singapore • If the DWB licence application is successful, iFAST Corp expects to launch its digital banking services by the end of 2021. • Based on estimates, the digital bank launch is expected to add between 9% to 11% to the Group’s operating expenses i
Slide 37: Progress of Individual Markets: Singapore
Progress of Individual Markets SINGAPORE • Net revenue for the Singapore operation increased by 20.4% YoY to S$12.91 million in 2Q2020, and rose by 22.5% YoY to S$25.10 million in 1H2020. • The growth in net revenue was due to the robust growth rates in AUA, sales and net inflows for FSMOne.com, its
Slide 38: Progress of Individual Markets: Singapore
Progress of Individual Markets SINGAPORE • FSMOne.com investors continued to invest actively into the different investment products including unit trusts, stocks, ETFs, bonds and cash solutions. • There was a significant contribution to net revenue from the stockbroking business, as investors contin
Slide 39: Progress of Individual Markets: Hong Kong
Progress of Individual Markets HONG KONG • Net revenue for the Hong Kong operation increased by 10.4% YoY to S$4.36 million in 2Q2020, and rose by 20.5% YoY to S$9.18 million in 1H2020. • The AUA of the Hong Kong operation recovered by 8.3% QoQ as global equities market continues to improve and grew
Slide 40: Progress of Individual Markets: Hong Kong
Progress of Individual Markets HONG KONG • iFAST Hong Kong’s focus on embracing Fintech has also allowed it to better position itself to work closely with its partners to take on the challenges. • Cash accounts balance of the Hong Kong operation continued to increase in 2Q2020 indicating that both t
Slide 41: Progress of Individual Markets: Malaysia
Progress of Individual Markets MALAYSIA • Net revenue for the Malaysia operation increased by 40.5% YoY to S$2.31 million in 2Q2020, and rose by 27.1% YoY to S$3.86 million in 1H2020. • The AUA of the Malaysia operation grew 35.5% YoY to a record high of S$992 million as at 30 June 2020. As markets
Slide 42: Progress of Individual Markets: Malaysia
Progress of Individual Markets MALAYSIA • In 2Q2020, the B2B division saw a decline in sales of unit trusts due to the implementation of MCO. However, the pent up demand led to a pick up in business towards the end of 2Q2020 as the MCO condition loosens. • The bond business also saw strong inflows a
Slide 43: Progress of Individual Markets: China
Progress of Individual Markets CHINA • Net revenue for the China operation grew 301.5% YoY to S$0.27 million in 2Q2020, and rose by 112.9% to S$0.53 million in 1H2020. • The AUA of the China operation grew 32.7% QoQ and 56.3% YTD to approximately RMB 805 million (equivalent to S$159 million) as at 3
Slide 44: Progress of Individual Markets: China
Progress of Individual Markets CHINA • iFAST China has continued to achieve healthy growth in 2Q2020 as it continues to work on improving the suite of products and services offered to its B2B partners. • While the COVID-19 situation continues to improve in China, the China operation has ensured that
Slide 45: Progress of Individual Markets: India
Progress of Individual Markets INDIA • As at 30 June 2020, iFAST Corp holds an effective 38.0% share in iFAST Financial India Pvt Ltd, the key business of the Group’s India business, which engages in the distribution of investment products including unit trust in India. • India’s AUA fell by 12.1% Y
Slide 46: Appendices
SECTION III Appendices iFAST Corporation Ltd. 46
Slide 47: Business Overview
Business Overview • iFAST Corporation Ltd. is a wealth management fintech platform with assets under administration (AUA) of S$11.15 billion as at 30 June 2020 (stock code: AIY). • Main business divisions: o Business-to-Consumer (B2C) platform, Fundsupermart (including the new FSMOne multi-products
Slide 48: Milestones
Milestones Launch of Fundsupermart.com (B2C) in Hong Kong • Distribution of bonds and ETFs in Launch of “FSM Mobile” Singapore iPhone application. The • Launch of online discretionary portfolio Android version of the “FSM Launch of management service (DPMS) in Hong Kong Mobile” was launched in Funds
Slide 49: Milestones (cont’d)
Milestones (cont’d) • iFAST Singapore clinched “Fastest Growing SGX-ST • Launch of HKEX stockbroking services on FSM Hong Kong Member” Award at SGX Awards Night 2019 • Launch of bonds on FSM Malaysia and online DPMS in • iFAST Malaysia launched retail bonds under the Securities Malaysia Commission M
Slide 50: iFAST Fintech Ecosystem
iFAST Fintech Ecosystem (as at 30 Jun 2020) 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 490,000 customer FA Companies accounts in 5 markets Over 450 compan
Slide 51: The iFAST Fintech Ecosystem
The iFAST Fintech Ecosystem • Products and services: ─ Unit trusts (over 7,500 funds from over 270 fund houses) ─ Bonds (over 1,400 direct bonds) ─ Stocks & ETFs – in 3 markets (Singapore, Hong Kong and US) ─ Discretionary portfolio management services • Over 450 financial institutions and other cor
Slide 52: 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 approximately 80% of our net revenue • Sources of Non-Recurring Net Revenue ─ Transactio
Slide 53: Licences Held and Products and Services Available
Licences Held and Products and Services Available (as at 30 June 2020) LICENCES HELD: • Fund Distributor Qualification [CSRC] • Associate Member of AMAC • Member of SAMC PRODUCTS AVAILABLE: UT LICENCES HELD: • Registered Investment Adviser with SEBI LICENCES HELD: • Registered Mutual Fund Distributo
Slide 54: 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 55: 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% 0.765% 0.732% 0.735% 0.731% 0.714% 0.700% 0.652% 0.625% 0.614% 0.629% 0.609% 0.606% 0.613% 0.596% 0.594% 0.600% 0.551% 0.500% 0.400% 0.300% 0.200% 0.100% 0.000% 2016 2017 2018 2019 1H2020 Net re
Slide 56: 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% 0.763% 0.729% 0.736% 0.733% 0.711% 0.700% 0.607% 0.606% 0.582% 0.599% 0.596% 0.600% 0.556% 0.572% 0.562% 0.551% 0.553% 0.500% 0.400% 0.300% 0.200% 0.100% 0.000% 2016 2017 2018 2019 1H2020 Net re
Slide 57: 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 iFAST Corporation Ltd. 57
Slide 58: 1H2020: Activities & Achievements
1H2020: Activities & Achievements iFAST Corp’s Pre-AGM Virtual Information Session and Annual General Meeting 2020 was successfully held via live webcast in April 2020. (L-R) Our Macro Research analysts were invited to be on the judging panel of the Eurasia Asset Management Challenge 2020 organised
Slide 59: THANK YOU!
TO HELP INVESTORS AROUND THE WORLD INVEST GLOBALLY AND PROFITABLY THANK YOU! For more information, please visit: www.ifastcorp.com iFAST Corporation Ltd.