Cash News
SMITH…ISP remains committed to exploring opportunities for growth whether through acquisitions or mergers
ISP Finance Services Limited (ISP) has taken another step toward expanding through acquisitions, announcing that it has now engaged an investment banker to explore and structure potential growth opportunities. The move signals the microlender’s continued ambition to diversify its portfolio and enhance its market position.
ISP has long been eyeing acquisitions as a strategy for growth, with CEO Dennis Smith previously hinting at upcoming deals during the company’s 2022 annual general meeting. While negotiations at that time were delayed, the company’s recent financial results suggest it may be better positioned to act on these ambitions.
“ISP remains committed to exploring opportunities for growth whether through acquisitions or mergers. To this end, we have engaged an investment banker to structure potential opportunities,” Smith said in the company’s just released annual report.
For the second quarter ending June 30, 2024, ISP reported a strong financial performance, driven by both revenue growth and cost containment. ISP’s focus on managing operating costs has been a key contributor to its profitability. Despite a modest 2.9 per cent increase in operating expenses, the company’s cost-control measures led to a significant reduction in staff costs, which fell by 28.6 per cent or $9.3 million. This helped to propel the company’s profit to $21.2 million, a staggering 341 per cent increase over the corresponding quarter in 2023.
Earnings per share (EPS) also reflected the company’s improved financial health, rising to $0.202 at the end of Q2 2024 — up 339.3 per cent increase compared to $0.046 in the same period last year. However, the growth in profitability was tempered somewhat by an increase in the allowance for credit losses, which rose by 37.4 per cent to $43.5 million.
The company’s loan portfolio has continued to grow, albeit at a slower pace.
Net loans increased by 4.0 per cent to $997 million in Q2 2024, up from $959 million in the same quarter last year. Total assets for the company now stand at $1.18 billion, marking a 9.1 per cent year-over-year increase.
ISP’s 2023 annual report further highlighted the company’s achievements, noting that its net loan portfolio surpassed the J$1-billion mark for the first time, reaching J$1.025 billion by the end of the year — a 34 per cent increase over the previous period.
ISP says it remains focused on disciplined cost management while maintaining a high standard of customer service. The company says it will expanded its loan offerings to cater to its primary customer base, which consists largely of public-sector workers. These loans are designed to address household expenditure, education, and health-care needs.
“Looking ahead, we plan to introduce new products that we believe will enhance shareholder value,” Smith said.