Australian fintech company SelfWealth Limited (ASX: SWF)
unleashed its revenue figure for the second quarter of Fiscal 2019. The company’s operating revenue jumped up by 22.5% to $522k, compared to the first quarter’s revenue of $426k.
It underscores another record of client acquisition set by the company in December quarter, resulting in strong growth in business volumes. The company further explained that although active traders increased by 34% to 9,369 during the Q2 FY19, there has been slow pace growth in the trade volumes primarily due to softened market conditions and seasonal impact of lower activity in December. This accounts to a marginal 11% increase in trading volumes of 33,994 recorded in Q2 FY19.
SelfWealth currently offers a $9.50 flat-fee ASX brokerage service and integrated, unique data-driven investment portfolio solutions. During the reporting quarter, its value of client cash held increased 18% to $61 million, from $52 million in Q1 FY19.
The company has continued to reduce the cash burn in Q2 FY19, partly reflecting reduced spending on advertising and marketing, lower staff costs and an R&D tax refund. As a result, its cash burn stood at $800k, approximately $400k lower than Q1 FY19. Also, cost per acquisition of each new active trader was down 60% in Q1 FY19.
In December, the company signed a significant agreement with ETFs Capital and ETF Securities Australia to develop and provide $100 million in seed funding for SelfWealth’s first ETF. Subject to the satisfaction of regulatory and ASX approval, the ‘SelfWealth SMSF Leaders ETF’ under the ticker code SELF are expected to be listed on ASX in Fiscal 2019.
SelfWealth CEO Andrew Ward said, “The launch of the SelfWealth SMSF Leaders ETF is expected to be a transformational event for the company, offering clients a high-performing investment asset that complements portfolios constructed using the SelfWealth platform, and delivering a new revenue stream to the company.”
Further, the company informed that its wholesale platform that allows financial advisers to manage client portfolios would eye more advisers joining the team in early 2019. Eventually, leading to significant growth in SelfWealth’s trade volumes and interest revenue.
Going forward, the Company commits to refine and enhance its trading platform, with development for international share trading scheduled for 2019. The company has also introduced updates to its mobile app and order placement process while it targets to position itself as a leader of data-driven investment tools.
“The continued growth of the trader base, a 2019 launch of the SelfWealth ETF, and the reduction in cash burn puts SelfWealth in a strong position,” Mr. Ward said.
In today’s trading session, SelfWealth stock surged 7.692% to last trade at $0.070 on 15 January 2019. Over the past 12 months, SWF has fallen 54.74%.
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