August 9, 2024, Almaty
In the first quarter of fiscal year 2025, Freedom Holding Corp. reported revenue of $450.7 million. This represents an increase of $134.5 million (+43%), driven by the following factors:
● Insurance Underwriting Income: Increased from $44.9 million to $129.4 million (+188%), primarily due to the growth in insurance premiums received, driven by the expansion of insurance operations and an increase in the number of active insurance contracts.
● Interest Income: Rose by $76.7 million, attributed to the expansion of the trading portfolio and a higher share of bonds within it. Additionally, there was an increase in interest income from bank loans provided to clients, margin loans, reverse repo agreements, and bank deposits, as well as available-for-sale securities.
● Net Profit on Derivative Financial Instruments: Increased by $43.1 million (+141%), primarily due to unrealized net profit obtained by the subsidiary JSC Freedom Bank Kazakhstan from the positive revaluation of currency swaps.
● Commission Income: Increased by $16.8 million (+17%), mainly driven by the increase in the number of retail brokerage clients. The growth was also supported by other commission income, primarily due to increased agency fees collected by a holding subsidiary, an online travel ticket aggregator.
● Net Loss on Trading Securities: Increased from $31.8 million in net profit to a net loss of $52.1 million (-264%). This change was due to an unrealized loss on trading securities, resulting from a decline in the value of securities positions held by the company as of June 30, 2024. A significant portion of the unrealized net loss is attributed to Kazakhstan's sovereign bonds, mainly due to the decline in market prices.
Expenses of the holding increased by $177.5 million (+77%). This dynamic was driven by the following factors:
● Commission Expenses: Increased by $51.5 million (+179%), mainly due to the rise in agency fee expenses related to the life insurance business.
● Interest Expenses: Increased by $50.7 million (+53%) due to the growth in short-term financing expenses via repo agreements associated with the expansion of the investment portfolio. The increase was also driven by higher interest on deposits due to the expanding client base of JSC Freedom Bank Kazakhstan.
● Salaries and Bonuses: Increased by $25.9 million (+82%) due to the growing number of employees in companies within the holding.
● Insurance Claims Paid (Net of Reinsurance): Increased by $25.8 million (+120%), primarily due to the expansion of insurance operations between the two quarters.
Net Profit of Freedom Holding Corp. for the first quarter of fiscal year 2025 amounted to $34.3 million. The holding’s earnings per share, calculated based on the basic weighted average number of shares of 59.3 million, was $0.58. The holding’s earnings per share, calculated based on the diluted weighted average number of shares of 60.3 million, was $0.57.
Assets of the holding increased from $8.302 billion to $8.485 billion (+2%). Liabilities increased from $7.315 billion to $7.333 billion (+3%).
The number of brokerage client accounts of the holding as of June 30, 2024, was 532 thousand, an increase of 2 thousand from the previous quarter.
Note:
For the holding, Q1 of fiscal year 2025 ended on June 30, 2024.
About the Company:
Freedom Holding Corp. is a diversified company providing financial services, engaged in brokerage activities, securities trading, investment research and consulting, investment banking, and underwriting services, as well as mortgages, insurance, telecommunications, online ticket sales for flights, and cultural and sporting events. It also offers online supermarket services and many others. Including its subsidiaries, Freedom Holding Corp. has more than 6.8 thousand employees. The headquarters of Freedom Holding Corp. is located in Almaty (Kazakhstan), and its divisions and subsidiaries are located in 20 countries, including Kazakhstan, the USA, Cyprus, Poland, Spain, Uzbekistan, Azerbaijan, and others. The common shares of Freedom Holding Corp. are registered with the U.S. Securities and Exchange Commission and traded under the ticker FRHC on the Nasdaq Capital Market. To learn more about Freedom Holding Corp., visit www.freedomholdingcorp.com.
Media Contacts:
Ramina Fakhrutdinova – Advisor to the Chairman of the Board of Directors for PR, JSC Freedom Finance
E-mail: [email protected]
