June 6, 2023

ISP Finance Services Limited (ISP) for the three months ended March 31, 2023:

Net interest income marginally increased to $97.14 million (2022: $97.43 million) after interest expenses increased 93% to $13.77 million (2022: $7.12 million) and total interest income increased 6% to $110.91 million (2022: $104.55 million). Management noted that the increase in interest expenses was due to the successful additional debt raise secured in October 2022 to facilitate future expansion plans.

Gross profit declined 2% to $92 million (2022: $93.73 million) following an increase of 39% in commission expense on loans, which closed at $5.14 million (2022: $3.70 million).

Total operating expenses increased 2% to $85.19 million (2022: $83.50 million) despite the 29% decline in allowance for credit loss to $28.11 million (2022: $24 million) as other operating expenses increased 24% to $34.41 million (2022: $27.83 million).

Consequently, profit before taxation declined 33% to $6.89 million (2022: $10.23 million).

After taxation of $861,147 (2022: $1.28 million), net profit declined 33% to $6.03 million (2022: $8.95 million).

Earnings per share (EPS) amounted to $0.06 (2022: $0.09). The trailing twelve-month EPS amounted to $0.52. The number of shares outstanding used for this calculation was 105,000,000. ISP’s stock closed the trading period at a price of $26.29 on June 5, 2023 with a corresponding P/E ratio of 50.45x.

Balance Sheet Highlights:

Total assets as at March 31, 2023 increased 39% to $1.07 billion (2022: $773.81 million). The major contributors to this movement were ‘Cash & cash equivalents’, which increased 278% to $206.69 million (2022: $54.65 million) and ‘Loans, net of provisions for credit losses’, which increased 16% to $789.51 million (2022: $679.48 million).

Shareholders’ equity as at March 31, 2023 increased 12% to $526.80 million (2022: $472.09 million), resulting in a book value per share of $5.02 (2022: $4.50).

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