TechFinancials Share Price Up 20% on H1 Report
On July 29th TechFinancials’ share price slumped to 8.5p but now on the release of their H1 2016 report the shares are now trading at 15.5p middle, up a storming 82%!
The main performer driving the TechFinancials share price up has been the B2C division where DragonFinancials has started performing to their potential. An earlier post suggested that TechFinancials might want to offload the B2C division and focus on their successful B2B business but that now looks unnecessary.
The H2 2016 Revenue was $9.86m (H2 2015: $7.34m) showing a 34% increase which in turn has lead to a Gross Profit of $7.36m up from $5.18m.
Although R&D, selling and marketing expenses, plus admin expenses all increased on their equivalent numbers from the same period in 2015, the Operating Profit for H2 2016 was still $1.59m (up from $0.1m. H2 2015) leading to a Post Tax Profit of $1.25m (H2 2015: -$80k). The cash position is a healthy $3.9m.
Asaf Lahav, Group Chief Executive Officer of TechFinancials, commented:
“We are pleased with these solid results. We are now seeing the fruits of our growth strategy and supporting initiatives undertaken during 2015 to return our B2C division to profitability. These include the agreement with Optionfortune, the investment in new product launches and our efforts to penetrate markets with high growth potential by opening an office in Hong Kong“.
OptionFair & DragonFinancials
Although the B2C business generated revenues from external customers of $4.47m (against the $5.39m from B2B licenses) it is not clear how much of this $4.47m was generated by OptionFair as opposed to the DragonFinancials business. TechFinancials are ‘extremely pleased’ by the success of the DragonFinancials JV and, along with other comments about the Far East market, it would appear that this is where the focus of attention will be directed. If that were to be the case then OptionFair could still be off-loaded, especially if the B2C numbers are disguising a poor performance by that ‘skin’.
There is no further direct reference to the US market which is also a good sign that the senior management are taking a more pragmatic view of what is achievable.
These numbers are most welcome and would suggest that the company is now on an even keel. With its advances in the Far East the company is certainly moving into a huge market segment, one which is likely to dwarf Europe. Onwards and upwards………
The full half year report can be accessed here.