May 1, 2024

ISP Finance Services Limited (ISP)

Audited financials for the twelve months ended December 31, 2023:

ISP Finance Services Limited (ISP) for the twelve months ended December 31, 2023, reported a 20% increase in Total Interest Income totalling $519.25 million compared to $432.46 million in the corresponding period last year. Total Interest Income for the fourth quarter had a 43% increase to close at $151.29 million compared to $105.91 million for the comparable quarter of 2022.

Interest Expense amounted to $60.48 million (2022: $37.05 million), this represents an increase of 63% year over year. Consequently, net interest income increased by 16% to $458.76 million compared to $395.41 million for the twelve months ended December 31, 2022. The company booked net interest income of $136.85 million for the fourth quarter versus $89.91 million reported for the similar quarter of 2022.

Commission Expenses on loans increased by 42% from $16.22 million in 2022 to $23.03 million in the period under review.

Gross Profit increased by 15% to close at $435.74 million (2022: $379.20 million). For the quarter, Gross profit totalled $131.73 million (2022: $85.02 million).

Allowance for Credit Loss for the twelve months ended December 31, 2023, amounted to $128.80 million, a 38% increase relative to $93.00 million reported in 2022, while Other operating expenses totalled $126.91 million a 13% increase from the corresponding period last year. (2022: $111.85 million). As a result, Total operating expenses for the twelve months ended December 31, 2023, amounted to $368.72 million, a 12% increase relative to $328.26 million reported in 2022.

Profit Before Taxation for the twelve months ended December 31, 2023, amounted to $75.85 million, a 17% increase relative to $65.02 million reported in 2022. Profit Before Taxation for the fourth quarter amounted to $36.38 million (2022: $10.52 million).

Taxation for the twelve months ended December 31, 2023, had a 19% increase to reach $9.23 million (2022: $7.78 million). As such, Net Profit for the twelve months amounted to $66.62 million, a 16% increase from the $57.24 million reported in 2022. For the fourth quarter, Net Profit was $33.21 million (2022: $9.55 million).

Consequently, Earnings Per Share for the twelve months amounted to $0.63 (2022: EPS: $0.55), while Earnings Per Share for the quarter totalled $0.32 (2022: EPS: $0.09). The number of shares used in these calculations was 105,000,000.

Notably, ISP’s stock price closed the trading period on April 30, 2024, at a price of $30.50 with a corresponding P/E ratio of 48.07x.

Balance Sheet Highlights

The company’s assets totalled $1.12 billion (2022: $1.06 billion). The movement in total assets was influenced by 35% uptick in ‘Loans, net of provisions for credit losses’ to $1.02 billion (2022: $760.62 million), while ‘Investments’ declined by 89% to offset the movement, closing at $25.00 million relative to $225.00 million last year.

Shareholder’s equity was $584.85 million (2022: $518.23 million), representing a book value per share of $5.57 (2022: $4.94).

Disclaimer:

Analyst Certification – The views expressed in this research report accurately reflect the personal views of Mayberry Investments Limited Research Department about those issuer (s) or securities as at the date of this report. Each research analyst (s) also certify that no part of their compensation was, is, or will be, directly or indirectly, related to the specific recommendation (s) or view (s) expressed by that research analyst in this research report.

Company Disclosure – The information contained herein has been obtained from sources believed to be reliable, however its accuracy and completeness cannot be guaranteed. You are hereby notified that any disclosure, copying, distribution or taking any action in reliance on the contents of this information is strictly prohibited and may be unlawful. Mayberry may effect transactions or have positions in securities mentioned herein. In addition, employees of Mayberry may have positions and effect transactions in the securities mentioned herein.