February 15, 2021
ISP Finance Services Limited’s (ISP) for the year ended December 31, 2020 reported total interest income of $369.11 million compared to $367.20 million in 2019, a marginal increase of 1%. For the quarter, total interest income amounted to $105.49 million (2019: $91.22 million). Total income is broken down as follows:
- Interest income from loans grew 1% to total $369.11 million relative to $367.07 million in the same period of 2019.
- Interest income receivables went down 100%, amounting to $203 (2019: $129,852).
Interest expense totaled $29.58 million relative to $31.51 million in 2019; this represents a 6% decrease. As a result, net interest income grew by 1% to total $339.53 million (2019: $335.69 million). Net interest income for the quarter amounted to $98.13 million (2019: $75.86 million).
Commission expense rose 132% to $6.92 million (2019: $2.72 million). In addition, foreign exchange loss totaled $79,404, compared to foreign exchange gain of $46,428 reported in the prior year.
As such, gross profit amounted to $333.23 million in 2020, a negligeable 0.1% rise relative to that of $332.97 million a year prior. For the quarter, gross profit rose 29% to $96.47 million (2019: $74.90 million).
The company’s total operating expenses amounted to $266.29 million, down 14% from $309.98 million in 2019, while for the quarter operating expense closed at $79.96 million (2019: $57.71 million). ISP highlighted that, “The Company has maintained its cost of operations while meeting greater customer demands. While additional expenses were incurred in setting up a cloud operating platform, the investment has supported our business development and collections functions.”
- The expenses for the period are broken down as follows:
- Staff costs amounted to $100.23 million (2019: $122.06 million).
- Allowance for credit loss totaled $60.23 million (2019 $87.64 million).
- Depreciation was $5.31 million (2019: $5.22 million).
- Other operating expenses amounted to $100.51 million (2019: $95.07 million).
Profit before taxes totaled $70.44 million (2019: $23.12 million). No taxes were reported for the year (2019: $180,081). Consequently, net profit for the period amounted to $70.44 million relative to $22.94 million in 2019, a 207% increase. Net profit for the quarter amounted to $19.68 million (2019: $17.08 million). ISP noted that, “The increase in profits was attributable to operating efficiencies and increase productivity from new work-from-home systems. While the economy continues to be affected by the battle against the COVID-19 pandemic, we have been able to respond to our customers loan needs.”
Total comprehensive income for the period under review closed at $70.44 million (2019: $22.94 million). While for the quarter, total comprehensive income amounted to $19.68 million (2019: $17.08 million).
As a result, EPS for the period closed at $0.67 (2019: $0.22). The EPS for the quarter was $0.19 (2019: $0.16). The number of shares used in our calculations is 105,000,000 units. Notably, ISP closed the trading period on February 12, 2021 at a price of $22.00 with a corresponding P/E ratio of 32.80 times.
Balance Sheet Highlights:
As at December 31, 2020, ISP reported total assets of $751.64 million, a 10% increase when compared to $683.20 million in the prior year. ‘Other receivables’ and ‘Loans net of provisions for credit losses’ contributed to this increase closing the period at $30.65 million (2019: $2.89 million) and $659.52 million (2019: $627.26 million), respectively.
Shareholders’ Equity as at December 31, 2020 was $413.77 million compared to $342.33 million in 2019. This resulted in a book value per share of $3.94 compared to $3.27 the prior year.
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