August 17, 2020

ISP Finance Services Limited’s (ISP), Results for the six months ended June 30, 2020, Total Interest Income amounted to $177.78 million compared to $182.02 million in 2019, a decrease of 2%. For the quarter, Total Interest income amounted to $92.13 million (2019: $95.80 million). Total Interest Income for the six months ended June 30, 2020 was broken down as follows:

• • Interest Income from Loans reduced by 2% to total $177.78 million relative to $182.02 million reported in the same period of 2019.
  • Interest Income Receivables amounted to $84 (2019: $174) for the period under review.

Interest Expense totaled $14.88 million relative to $15.14 million in 2019; this represents a 2% decrease year over year. As a result, Net Interest Income decreased by 2% to total $162.90 million (2019: $166.88 million). Net Interest Income for the quarter decreased 5% to total $84.16 million (2019: $88.25 million).

Commission Expense rose by 222% to $3.56 million (2019: $1.11 million), while other income amounted to $352,000 (2019: $1,000). Foreign Exchange Loss totaled $97,313, relative to a gain of $94,109 booked in 2019. As a result, gross profit decreased to $159.60 million (2019: $165.87 million), while for quarter, gross profit went down by 5% to $83.24 million (2019: $87.93 million).

The Company’s Total Operating Expense amounted to $129.41 million down from $137.23 million in 2019. Expenses were broken down as follows:

• • Staff Costs amounted to $58.49 million (2019: $65.10 million)
  • Allowance for Credit Loss totalled $20.42 million (2019: $27 million)
  • Depreciation was $2.63 million (2019: $2.60 million)
  • Other Operating Expenses amounted to $47.88 million (2019: $42.54 million)

Consequently, net profit for the period under review amounted to $30.19 million relative to a profit of $28.64 million in 2019, a 5% increase year over year. However, net profit for the quarter had an increase of 55% amounting to $19.65 million (2019: $12.65 million).

Management noted that, “the Company has maintained its cost of operations while meeting greater customer demands. The newly established customer sales contact center is contributing to the business development thrust aggressively promoting the Company’s most recent back-to-school loan initiative.”

As a result, EPS for the period closed at $0.29 (2019: $0.27). The EPS for the quarter was $0.19 (2019: $0.12). The 12-month trailing EPS is $0.23, and the number of shares used in our calculations is 105,000,000 units. ISP’s stock last traded on August 17, 2020 at $14.59.

Balance Sheet Highlights:

As at June 30, 2020, ISP reported total assets of $691.46 million, a 6% uptick when compared to $652.72 million in the prior year. This was attributed to the increase of the company’s ‘Cash & Cash Equivalents’ which closed at $49.14 million (2019: $9.79 million), up $39.34 million.

Shareholders’ Equity as at June 30, 2020 was $373.88 million compared to a $349.03 million in 2019. This resulted in a book value per share of $3.56 compared to $3.32 the prior year.

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