Access Financial Services Limited (AFS) for the year ended March 31, 2020 reported $1.70 billion in total interest income, a 21% increase relative to the $1.41 billion recorded in 2019. Of this, Interest Income from Loans amounted to $1.70 billion (2019: $1.40 billion) while Interest Income from Securities totalled $1.37 million (2019: $6.99 million).

Interest Expense for the year ended March 31, 2020 totalled $253.59 million, an 83% increase compared with the $138.61 million booked in 2019. This resulted in AFS booking a Net Interest Income of $1.45 billion for the period, 14% more than the $1.27 billion in 2019. For the quarter, Net Interest Income totalled $341.25 million, a 198% increase relative to the $114.66 million recorded in 2019.

Net Fees and Commission Income for the period under review amounted to $617.75 million, a 98% increase from the $311.38 million in 2019. According to Management, this was due to, “the Embassy Loan’s business model which generates a significant amount of its revenue in fees.”

AFS booked a total of $2.07 billion for Net Trading Income, a 31% increase compared with the $1.58 billion in 2019. For the quarter, a net trading income of $435.81 million was recorded (2019: $287.76 million).

For the year ended March 31, 2020, AFS reported income from Money Services and Other Income of $1.79 million (2019: $29.66 million) and $91.20 million (2019: $44.74 million) respectively. Foreign Exchange posted a loss of $5.48 million relative to a loss of $4.58 million booked in 2019. As such, Other Operating Income for the year totalled $87.51 million compared with $69.82 million in 2019.

AFS reported Operating Expenses of $1.76 billion (2019: $1.10 billion) for the year ended March 31, 2020. Of this:

• Staff Costs totalled $725.44 million (2019: $491.17 million).
• Allowance for Credit Losses amounted to $297.05 million (2019: $146.83 million).
• Depreciation & Amortization amounted to $118.12 million (2019: $30.33 million).
• Other Operating Expenses booked for the period totalled $618.55 million (2019: $433.34 million).

Regarding total operating expenses, Management noted that, “operating expenses for the year was $1.76 billion, compared to the restated amount of $1.1 billion in the prior year. Excluding the allowance for loan losses, operating expenses for the period increased by $507 million year over year, of which Embassy Loans accounted for $442 million. Allowance for credit losses increased with the growth in loan portfolios, and changes to the expected credit loss model due to the impact of Coronavirus (COVID-19).”

AFS reported a Profit before Taxation of $395.53 million for the year relative to $546.66 million recorded in 2019. Following a taxation amount of $65.78 million (2019: $100.31 million), AFS booked Profit for the year of $329.75 million, a 26% decline relative to the $446.35 million recorded for the comparable period in 2019.  The Company noted that this was, “attributable to lower net interest margins and an increase in operating costs, particularly in relation to higher allowance for credit losses and loans written off.” For the quarter, net loss amounted to $38.76 million, relative to a loss of $137.34 million recorded in 2019.

Total Comprehensive Income for the period amounted to $408.05 million (2019: $423.55 million).

Consequently, earnings per share for the year amounted to $1.20 (2019: $1.63), while loss per share for the quarter amounted to $0.14 relative to a loss per share of $0.50 for fourth quarter of 2019. The number of shares used in this calculation was 274,509,840 units. AFS’s stock price closed the trading period on June 30, 2020 at $25.46.

AFS stated that, “this financial year represents the first year of the full consolidation of Embassy Loans Inc. (Embassy Loans), our wholly owned subsidiary in Florida, USA., which was acquired in December 2018. Our strong performance for loan disbursements during the first 11 months of the year was tempered by the impact of the Coronavirus (COVID-19) pandemic in March 2020.”

With regards to the Coronavirus (COVID-19) Impact, Management stated that, “Across both companies within the Group, we managed the impact of Coronavirus (COVID-19) by providing temporary relief assistance to customers; increased the use of technology to submit loan applications via the websites; and direct to bank disbursements.”

Balance Sheet Highlights:

As at March 31, 2020, the company’s assets totalled $5.96 billion, up 32% from $4.51 billion in 2019. This increase was largely attributable to ‘Loans and Advances’ which amounted to approximately $4.47 billion, $1.06 billion more than the $3.41 billion in 2019 “based on company’s strategic focus of growing the portfolios to capture market share, and disbursing larger loans for Embassy Loans,” as per AFS.

Shareholder’s equity as at March 31, 2020 stood at $2.17 billion (2019: $1.90 billion) resulting in book value per share of approximately $7.91 (2019: $6.91).