Group financial performance

 

(UNAUDITED)
(IN USD THOUSANDS)

 

H1 2022

 

FY 2021

 

H1 2021

 

FY 2020

 

YoY %
Change

 

YTD % Change

 

YTD % Change
(constant currency)

Profit before tax 23,843 25,705 7,522 2,578 217% 86% 91%
Net profit 13,079 6,358 1,422 -1,395 807% 311% 352%
Cost/income ratio 66% 77% 85% 98%      
Return on average assets (TTM)(1) 4.6% 1.1% 0.5% -0.2%      
Return on average equity (TTM)(1) 25.5% 6.0% 2.8% -1.3%      
Earnings growth (TTM)(1) 807% 556% 197% -104%      
OLP 378,371 403,738 415,009 415,304 -9% -6% 4%
Gross OLP 398,990 430,698 456,925 445,257 -13% -7% 2%
Total assets 546,093 562,554 585,300 579,260 -7% -3%  
Client deposits(2) 86,291 87,812 86,922 80,174 -1%  -2%  
Interest-bearing debt(2) 299,652 314,413 334,565 337,632 -10% -5%  
Share capital and reserves 100,451 103,443 105,020 107,073 -4%  -3%  
Number of clients 2,403,172 2,380,690 2,506,110 2,380,685 -4%  1%  
Number of branches 2,129 2,044 2,036 1,965 5%  4%  
Average Gross OLP per client (USD) 166 181 182 187 -9% -8% 1% 
PAR>30 days 5.1 5.2% 12.3 13.1%      
Client deposits
as % of loan
portfolio
23% 22% 21%  19%      

(1) TTM refers to trailing twelve months.
(2) Excludes interest payable.

“I am pleased with the Company’s operational and financial performance in the first half of 2022. In most markets we saw good growth of our loan portfolio and high portfolio quality, with pre-tax profits increasing to USD 23.8 million in the first half of 2022.”

Dirk Brouwer - CEO, ASA International Group plc

  • The Company’s operational and financial performance continued to improve with OLP growth and high portfolio quality in most markets leading to pre-tax profit increasing from USD 7.5 million in H1 2021 to USD 23.8 million in H1 2022.
  • Almost all operating countries grew their OLP in constant currency terms, maintain high portfolio quality, and make positive contributions to the Group’s profitability, with the exception of India, Myanmar and Sri Lanka.
  • High OLP growth in Pakistan, the Philippines and Ghana, though tempered by significant currency depreciation in these markets (PKR down 16%, PHP down 8% and GHS down 30% against USD in the Period), which contributed to the decrease of Group OLP in USD terms.
  • As portfolio quality improved or stabilized across most markets, the Company significantly reduced expected credit losses (‘ECL’) charged into the Income Statement to USD 1.9 million (H1 2021: USD 22.1 million and FY 2021: USD 37.5 million). Provisions for expected credit losses on OLP in the balance sheet, including the off-book BC portfolio and interest receivables, reduced from USD 27.5 million to USD 22.0 million primarily for the write offs in H1 2022.
  • ASA India’s OLP reduced in order to continue to prioritise the recovery of existing and overdue loans with a responsible amount of disbursement. As of 30 June 2022, ASA India has collected USD 1.8 million from a total of USD 16.6 million in written-off loans since 2020, while collection efficiency continued to improve reaching 85%.
  • The Group remains well capitalized and has a strong funding pipeline of fresh loans. At 30 June 2022, the Group had approximately USD 91 million of unrestricted cash and cash equivalents, with a funding pipeline reaching approximately USD 190 million. During the Period, the Group successfully raised USD 85 million in fresh debt to fund its operations.

Based on the positive developments during the first half of 2022, it is expected that the Group’s operating performance in terms of OLP growth and portfolio quality will continue to improve. However, the impact of inflation and related FX movements are expected to continue to dampen the financial performance in USD terms in the second half of 2022.

After careful consideration, the Board has decided to not declare a dividend in 2022, however, the Company expects to return to its pre-Covid 30% dividend policy in 2023, assuming the operating and financial performance continues to improve.

DIRK BROUWER, CHIEF EXECUTIVE OFFICER OF ASA INTERNATIONAL, COMMENTED:

“I am pleased with the Company’s operational and financial performance in the first half of 2022. In most markets we saw good growth of our loan portfolio and high portfolio quality, with pre-tax profits increasing to USD 23.8 million in the first half of 2022. Especially Pakistan, the Philippines and Ghana reported high OLP growth, though tempered by significant currency depreciation in these markets, which contributed to the decrease of Group OLP in USD terms. We expect that the positive operating developments of the first half of 2022 will continue to improve in the second half of 2022 but that the impact of inflation and related FX movements will also continue and therefore dampen the financial performance in USD terms in the second half of 2022. Despite the continuous challenging operating environments in India, Myanmar and Sri Lanka, we expect higher demand in the second half of the year from clients of our other subsidiaries which will drive the growth of the Group’s operating performance.”