Currency exchange Ozforex Group Ltd (ASX: OFX) had seen its share price gain 2.2% to $2.80 in early morning trading, after releasing its interim results, for the six months to end of September 2015.
Unfortunately for shareholders, the 1.2% fall in the S&P/ASX 200 (index: ^AXJO) (ASX: XJO) has pulled back OzForex's shares to being up just 0.4%.
Here's a quick summary of the key facts:
- Record turnover, up 34%, surpassing $10 billion for the first time ever
- Revenues up 30% to $58.1 million
- Underlying EBITDA up 14% to $18.1 million
- Reported net profit down 6% to $11.2 million
- Underlying net profit up 12% to $12.3 million
- Dividend of 3.6 cents, fully franked
The company also note that it had seen strong growth in active clients, transaction numbers and average transaction value. Growth in operating income grew in all regions, with North America particularly strong at 57% and Asia with 35%.
Ozforex says it remains debt free, with $48.3 million in cash on its books.
Looking forward, Ozforex CEO Richard Kimber says a number of initiatives should increase turnover and attract even more customers. Those include 24 hours, 7 days a week trading in the second half and reducing the $1,000 minimum transaction size to $250.
The company reaffirmed its 2016 full financial year guidance of between $38.5 and $40.5 million in EBITDA (earnings before interest, tax, depreciation and amortisation), suggesting an even stronger second half result.
Banking services
A key factor determining the value of Ozforex shares is the support for the company shown by the company's bankers. While the company doesn't need debt itself, it does need bank support for transactional banking, wholesale foreign exchange and deposits as well as making transfers.
Westpac Banking Corp (ASX: WBC) withdrew its support earlier this year but fears other banks would follow haven't eventuated.
Ozforex was able to replace Westpac quite quickly and has relationships with around 14 banks currently.
Foolish takeaway
Shares don't look cheap at the current price of around $2.80, trading on a prospective P/E ratio of around 22.8x and a dividend yield of around 2.6%. But if Ozforex can continue to grow at such high rates, then today's price may well be an opportunity.
