SelfWealth shares continue to slide despite record revenues and active traders.
The post SelfWealth (ASX:SWF) share price slips despite record FY21 result appeared first on The Motley Fool Australia. –
At the time of writing, the SelfWealth share price is down 1.37%, trading at 36 cents.
SelfWealth share price tumbles despite record FY21 performance
The SelfWealth share price is struggling to catch a bid on Friday despite delivering record results across key performance metrics. Some key highlights from the company’s FY21 results include:
Revenue of $18.4 million, up 135% year-on-year
Earnings before interest, taxes, depreciation, and amortisation (EBITDA) loss of $0.5 million compared to a $2.4 million loss in FY20
Net loss of $0.6 million compared to a loss of $3 million in FY20
95,189 active traders on the platform, up 105%
Gross profit margin increased to 41.4% from 33.4%
What happened for SelfWealth in FY21?
It’s been a challenging year for the SelfWealth share price, down 36% year-to-date to 35.5 cents.
In stark contrast to its weak share price, the company delivered a record financial performance in FY21.
SelfWealth has hailed FY21 as a successful year of product and features release. These include enabling adults to invest on behalf of children, adding ASX announcements to the platform, flat-fee US trading and the delivery of both native iOS and Android mobile apps.
In December 2020, the company launched its US trading feature, with an encouraging 29% of total active traders adding the new functionality to their existing ASX portfolios in the first six months.
SelfWealth advised that international trading generated $1.2 million in revenue at a higher gross margin than the domestic market.
SelfWealth has made an encouraging step towards profitability, with a positive operating cash flow of $1.1 million in FY21, up from a $147,000 loss in FY20.
This is in light of a 41% surge in operating expenses to $8.5 million, which includes increases in employee benefits, new hires and a three-fold increase in advertising and promotional costs.
SelfWealth CEO Cath Whitaker provided commentary for the company’s focus in FY22.
In FY22, SelfWealth’s core priority is to invest in the next phase of growth to continue market share expansion. SelfWealth has a scalable platform with diversified revenue streams and significant operating leverage.
We see the continuation of favourable external trends, including low-interest rates and the ongoing digitisation of investment markets, underpinning the addressable market growth and we are confident that the company is well-positioned to deliver ongoing growth over the years ahead.
What’s next for SelfWealth?
The SelfWealth share price has a long road to reach break-even.
Encouragingly, the company has laid out a detailed product roadmap, developed based on comprehensive customer surveys and in-depth market research.
SelfWealth said that in Q1 FY22, it will launch live pricing, instant deposits and a desktop US refresh. And in Q2 FY22, the company aims to enter new global markets and improve tax reporting.
Another key highlight for SelfWealth is its plans to implement a cryptocurrency trading feature in FY22, subject to board and relevant regulatory approvals.
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Motley Fool contributor Kerry Sun has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.