TORONTO: Sunwah International Limited, TSX: SWH (the “Company”), an Asian based financial services firm, today announced its financial results for the period ended September 30, 2017. All figures quoted are in U.S. dollars. Sunwah International and its subsidiaries (collectively “the Group”) recorded a net profit attributable to owners of the Company of $0.3 million in the first quarter of Fiscal 2018, which compares with a small profit of $22,000 last year. The increase is the result of solid growth in the Group’s service revenues as well as strong gains in its proprietary investments portfolio alongside strategies to stabilize its investment returns.
Strong investor sentiment globally, including in Hong Kong and key parts of Asia where the Group is particularly active, contributed to a rise in total revenues for the period to $5.7 million from $4.3 million last year. Realized and unrealized mark-to-market gains in proprietary trading income remained steady relative to last year at $1.2 million while commission and fee income increased significantly to $3.6 million from $1.9 million in Q1 FY2017, reflecting respectable gains within the Group’s brokerage division as well as an upsurge in advisory fee income. Selling and administrative expenses, including commission expenses, rose to $4.8 million from $3.9 million in last year’s corresponding quarter, which was commensurate with the rise in total income.
Sunwah International’s improved financial performance for the quarter reflects a shift in investment strategy within its proprietary trading division to an absolute return focus as well as efforts to strengthen the Group’s fee based earnings, driven by its mainstay Capital Markets Group. In particular, the Company is focused on its international growth strategy and expansion into promising parts of Asia, giving it a first-mover advantage in these regions and positioning the Company to benefit from such initiatives as China’s One Belt One Road project and the newly concluded Free Trade Agreement negotiations between Hong Kong and the Association of South East Asian Nations (ASEAN). Schemes such as these promote economic collaboration amongst Asian nations, resulting in new business opportunities and heightened trade and investment flow.
“We are encouraged by the Group’s operational performance over the last several quarters and are pleased to see this translate into positive financial strides as evidenced by this period’s results and the return to profitability of our proprietary investment division in Fiscal 2017,” said Michael Choi, President and CEO. “The Company continues to target resources within our Capital Markets Group, and we are particularly excited by our expansion into several up-and-coming markets, which positions us to capitalize on new regulatory programs that enhance connectivity between key Asian economies.”
