(Alliance News) - ASA International Group PLC on Monday said it recorded a "solid" operational performance in the first half, with loan-book growth in line with its own expectations.
The emerging markets microfinance lender noted, however, its dollar earnings are "somewhat behind" expectations due to "larger than expected" currency headwinds in Ghana and Pakistan, two of ASA's largest markets.
Shares in ASA International were 8.8% lower in London on Monday morning at 351.00 pence each.
In the six months to June 30, net profit was USD16.1 million, almost double the USD8.5 million recorded the year before.
At June 30, ASA's outstanding loan portfolio stood at USD419.5 million, 21% higher than the USD347.4 million seen at the same point a year prior.
ASA's average outstanding loan per client grew 6.4% to USD181 from USD174 the year before. The microlender's total number of clients increased 15% to 2.3 million.
The percentage of the loan book that has one or more instalment of repayment of principal past due for more than 30 days increased to 1.0% in the first half from 0.4% the year before.
ASA's cost-to-income ratio increased to 61% from 54% the year before.
"In the first half of 2019, we maintained our positive operating and financial performance," said Chief Executive Dirk Brouwer.
Brouwer continued: "With the exception of a slower growth rate in West Africa, primarily due to customary seasonality effects, we have continued to see strong branch, client and loan portfolio growth across most of our markets. In particular, East Africa continues to perform well with higher than expected operational and earnings growth."
In south east Asia and west Africa, ASA saw its financial performance come in "below expectations", due to "worse than expected" depreciation of Ghanaian cedi and "slower than expected" growth in Nigerian and the Philippines.
East Africa, however, saw higher-than-expected operating and financial growth, which ASA said reaffirmed its confidence in the region as a "major future profit generator" for the firm.
"As expected, currency movements continue to have an impact on our USD performance, however, we remain focused on our long-term growth strategy by growing our loan portfolio, expanding our geographical footprint, aligning growth in assets and liabilities, as well as enhancing our digital platform. As a result, we look forward to continued growth with confidence," added Brouwer.
ASA did not declare an interim dividend, in line with its policy.
Asa Int (ASAI)