Freedom Holding revenue jumps 40% to $732.5 million on brokerage growth

Freedom Holding Corp. reported fiscal first-quarter revenue of $732.5 million, up 40% from a year earlier, driven by growth across its brokerage and banking segments.

"Our results this quarter reflect the continued strength and momentum of our business across the Freedom ecosystem," Chief Executive Officer Timur Turlov said.

Brokerage revenue rose 60% to $282.6 million, banking revenue climbed 54% to $225.2 million, and the Other segment doubled to $73.9 million. Net income fell to $31.7 million, or 52 cents a share, from $37.4 million, or 61 cents, a year earlier, as total expenses rose 45% to $691.7 million.

Total assets reached $14.05 billion, up from $13.16 billion at the end of March, while shareholders' equity rose to $1.54 billion. The company completed a $300 million share offering in July and acquired a 99.32% stake in Turkish Bank A.Ş. for $33.4 million, extending its banking footprint beyond Kazakhstan.

Interest income climbed 49% to $295.1 million, helped by higher margin lending and customer loan income, while fee and commission income rose 46% to $156.7 million on brokerage activity. Net gains on trading securities increased to $79.8 million from $45.6 million, reflecting gains on Kazakhstan sovereign and corporate debt.

The banking segment served 5.447 million customers as of June 30, up from 5.026 million at the end of March, with deposits growing 20% to $3.03 billion. Brokerage customers rose to 874,000 from 858,000, while insurance customers fell to 924,000 from 1.117 million after regulatory changes in Kazakhstan reduced new business volumes.

Total customers across the group reached 8.743 million, up from 8.1 million. Operating cash flow swung to an outflow of $341.6 million from an inflow of $480.8 million a year earlier, with financing activities providing $1.22 billion.

On June 24, S&P Global Ratings raised its long-term issuer credit ratings to BB- from B+ on Freedom Finance JSC, Freedom Finance Europe, Freedom Finance Global, and Freedom Bank Kazakhstan, with stable outlooks. The company also acquired ChessBase GmbH, a German chess software provider, on June 1.

The revenue expansion points to continued momentum in Freedom's digital fintech strategy, though higher expenses and a swing to negative operating cash flow bear watching. Investors will look to the integration of Turkish Bank and the rollout of Freedom's ecosystem in Turkey as the next events to watch.

This article is for informational purposes only and does not constitute investment advice.