Q4 2024 CURRENC Group Inc Earnings Call
Hello and welcome to CURRENC Group in fiscal year 2024 earnings conference call. Online has been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question in answer session.
If you would like to ask a question during this time, please press star followed by the number one on your telephone keypad. If you would like to withdraw your question, press star one again. Thank you. Now, I would like to turn the call over to Liz, company's IR Council. Please, please go ahead.
CURRENC Group
Liz: Thank you, operator. Hello, everyone, and welcome to CURRENC Group's full-year 2024 earnings conference call. The company's results were issued earlier today and are posted online.
Speaker Change: Joining me on the call today is Mr. Ronnie Hoye, come and see Chief Executive Officer. Mr. Hoye will provide an overview of the company's business and financial highlights followed by a discussion of its business transformation and AI initiative.
Speaker Change: Before we continue, I refer you to our Safe Harbour Statement in the earnings press release, which applies to this call as we will make forward-looking statements.
Speaker Change: Also, please note that this call includes discussions of certain non-GAAP financial measures. Please refer to our earnings release which contains a reconciliation of non-GAAP measures to the most comparable GAAP measures .
Speaker Change: Finally, please note that, unless otherwise stated, all figures mentioned during this call are in US dollars.
Speaker Change: I will now turn the call over to come and see CEO Mr. Ronnie Hoy. Ronnie, please go ahead.
Thank you, Liz. Hello, everyone.
Speaker Change: Thank you for joining us on our first earnings score as a properly list company.
Speaker Change: is truly an important milestone for currency and privilege to address our new and long-standing shoulders as we embarked on this new chapter.
Speaker Change: We greatly appreciate your support and look forward to maintaining transparency.
Consistence, Communication with the Investment Community The Investment Community
Nabotos, who are not well familiar with CURRENC Group.
Now we are a fintech, pannier, empowering financial institution.
which provides AI solutions worldwide.
Speaker Change: We've got our start-in cross-border visual remittance and airtime transfer, and now we are trying to build a global platform providing both individuals and financial institutional institutions.
Speaker Change: We've saved cost-effective ways to move money across the border for over 150 countries.
Now we are...
undergoing a very important business transformation.
to extend our AI-powered offerings.
Speaker Change: While we still remain quietly in our broad omission of serving the financial institution and the balancing of financial inclusivity, going forward.
Speaker Change: We will be focusing on creating more AI-driven solutions that can reduce cost.
and boost the operating efficiency and enhance the customer experiences.
Now, let's reveal our existing core business line first.
I'm
Speaker Change: Today, I mean, in the year 2024, our main bulk of businesses is the digitally-mechanical
Speaker Change: It's conducted through our subsidiary triangle, which we provide a B2B and B2C cross-border transfers.
for a Powerful Unified EPI.
Speaker Change: They can integrate over 5,000 banks and 35 new orders, which cover 150 countries.
Now, in 2024, Franco process 11.4 million remittance transitions.
and the total processing value of the TV.
reached 5.14 billion based on it.
Speaker Change: Now we close out 2024 on a high note in terms of remittance.
and strong growth and solid growth momentum.
Speaker Change: Both the transition volume and the TVV total processing volume increased in 2024.
Speaker Change: which reflected strong, strong demands in key corridors, such as UK, Hong Kong, Singapore, Korea, and as well as some new markets throughout the Southeast Asia.
Now, um...
Speaker Change: We have harnessed the most attractive growth opportunities in cross-border payments and we have built new partnerships growing our active user base.
Despite the intense competition in the markets.
Speaker Change: We also have improved our technological infrastructure during the year which position us to deliver sustainable growth and more shoulder value in the years ahead.
Speaker Change: We also have global air time transfer business for the moment.
which also is provided by Trangle.
and through another Arab.
To see free water cool, we provide local air time in Indonesia.
Speaker Change: Watercoolers serve around 128,000 customers as of the end of 2024.
Speaker Change: And this will be an airtime with a total value of 14.5 million for the full year of 2024.
Speaker Change: Despite that, the air time segment has historically served as the key means of revenue diversification.
Speaker Change: Going forward, we strategically believe that we should deemphasize this business. First, to focus more on our resources on the digital remittance business, as well as the new AI solutions business.
which we believe will.
Deliver more stronger long-term growth opportunities and profitability.
Now, um...
Some highlights for the full year of CURRENC Group.
Speaker Change: Firstly, did you remittance business meaning those process through Trangle? The total processing value was 5.14 billion?
Speaker Change: The total number of transitions increased to 11.4 million transitions per year or 24.
So...
Speaker Change: There may be a lot of confusion if you read the financial statement because the 2024 financial statement includes other subsidiaries like 10G Asia and GA, which will already crop out
Speaker Change: So I would like to draw your attention to those really meaningful figures for us. I need the total revenues excluding K&Asia and E.A.
Speaker Change: Now for the total revenues explained to you Asia and GA for the year 2010 it was 42
which represent to turn the turn of free was a mild decline of 3.4%.
Speaker Change: And actually, the decline was mostly due to a quite big decline of 23.8% in.
Group A time revenue.
Speaker Change: And I would also like to remind everyone that as TNT Asia and GA will audit the virus.
Speaker Change: In the year of 2004, so in the fourth queue and going forward, their revenues will not be count and we should look at the revenue contributed by triangle.
Speaker Change: We witness Christmas by triangle and work with care time business as well as the new AI solutions
Speaker Change: and I'm going to be back in about a minute. I'll be right back. I'm going to be back in about a minute.
Speaker Change: Now, as the main part of our business was still the digital emissions. So, let's focus on the digital emissions revenues.
Speaker Change: That is, the revenues contribute mostly by digital emitters of triangle was 18.2 million for a full year 2010-04, which compared to 2013-03 was an increase of 6.4%.
Um, despite that the, uh, TV, uh,
Speaker Change: Processed by a triangle was an increase of 13.2%.
Speaker Change: The overall peak rate of triangle-decide.
Speaker Change: From 0.43% of 2023 down to 0.37% in 2024 and that the decline was many due to intense competition in the market.
Speaker Change: that we want to be more and more price competitive, we want to launch more price competition, so it's to kept you more and more market.
Speaker Change: In other words, we are kind of sacrificing the tick rate in order to get a higher and higher up this is for them.
and also for the co-heater of CURRENC Group 4.
The on demand equity of Bipronet.
Speaker Change: represent only 4.5% of Trudeau TVN. So, RIPO transaction is not a first significant settlement of the company. Traditionally, RIPO's throw.
carries a lower rate.
So with lower and lower
Speaker Change: We expect that the overall fix rate should be bottom out and we expecting a bottom out or the declining trend of the tick rate will come to a halt.
Speaker Change: Now, let's go to the another business, the global aircraft business. This is factory. This was the segment.
Speaker Change: that sustain a significant decline in the year 2004 and that contribute to a decrease in the total revenue as well as the profitability.
Speaker Change: For the Global Aircraft Transfer Revenue for the year of 2004, it was 9.3 million.
Speaker Change: which represent a 23.8% decline as compared to late year 23.
Now, the reason was that the market has...
Speaker Change: changed quite a lot in the past 4 years, especially before and after the COVID.
Speaker Change: There was an increasing growing availability of free Wi-Fi in Southeast Asian countries, especially the Malaysian and Indonesia.
Speaker Change: And therefore, this led to a declining demand for the Malaysian Indonesian airtime transfers.
Speaker Change: And there were that led to a decline in Franco's global atom business in 2024.
Speaker Change: Now, we expected the crime would be kind of continuing, given the market is finished. And we expected a more new market like Africa or other countries.
Speaker Change: We might be possible, possibly explore or expand new markets there on the global Borghietan Transfer of Business
Speaker Change: However, they don't want to place too much emphasis on the airtime.
Speaker Change: Transcript business because of two reasons. One is that they carry a lower worth margin
Speaker Change: In a second, instead, they have a county-civil issue, meaning that we have to provide working capital for that. So we believe that it would be more.
Speaker Change: Useful for the company to make use of the capital and allocate it in expanding its digital rewritten space as well as in expanding its new AI businesses.
Speaker Change: Now, on the other hand, you look at the total direct.
course for revenue.
which exclude the K&DA and GA.
was $28.9 million for the year of 2024.
Speaker Change: which represent a decline of 8% as compared to 2023, this was in line with the decline in the global air time business.
But also it refracts that we have.
Speaker Change: Successfully control the directly already so for our digital remittance business. So if you look at the direct
Speaker Change: sale rates for trunkles remittance business. In the year 2023, we paid
0.15% to our PR agents.
Speaker Change: for the digital remittance business. And 20104, the PL-RESO decline at 2, 0.12% meaning that we can get
Say hi, Martin.
Despite that our overall degree was also the kind.
So if you look at the
Speaker Change: The gross profit margin for the meetings business, which excluding TNG Asia and GA.
For the year of 2024, it was 62%.
Speaker Change: which compared to 58% of 2023. So we can see that our gross profit margin for the diesel engines business actually improved because we have successfully control.
Speaker Change: the PR ratio. As for the old robust profit margin for the full year of 2010-04, it was 31 percent.
Speaker Change: which, compared to 28% of 2003, it was also a showing and increased.
Speaker Change: Now, another key thing that I would like to draw you attention is the total operating
Because if you look at the total operating expenses
It was a massive 42 million.
Speaker Change: for the year 2024, which compared to 24 million for the year 2023. Now the substantial increase was many due to a non-tash item, which is a 20.9 million.
Speaker Change: In recognition of the incentive shares granted to employees because the scheme was granted only.
Speaker Change: When there was a completion on the de-spec, so that's why we have the book that in the same share scheme, the non-cash item in the year of 24.
Speaker Change: And also, there was a 1 million shares, expenses, again, non-cash funded to Roth, because we have been engaged in them, and so I will cover the market at the price of it.
Speaker Change: Now, as I stated before, since CURRENC directs 10 to 8 sure and GA in progress in July last year.
So going forward.
Speaker Change: The operating costs reflect the operating costs of triangle water cool and also the headquarters only. Also, there might be new AI initiatives, which would incur also the operating costs.
Speaker Change: Now, therefore, I would like to draw your attention to the Trangle Operating course for the full year 2024.
Speaker Change: It was 12.9 million representing an increase of 4.9%, as compared to...
2023, so the operating expenses of Trangle.
Speaker Change: was actually increased in line with this total processing value. There's no not much surprise on that.
Speaker Change: Now, for WaterCoup, the total operating cost was even lower, 1.2 million for 2024, which one compared to 1.5 million for 2021 is free. Again, it's because of our stringent cost control.
Now, as will the set quarter.
Yeah, many.
Speaker Change: Expenses, which I would come to later on, but quality expenses is the legal professional fee.
Speaker Change: For year 2024 is $1.7 million, for 2023 is $4.7 million.
Speaker Change: Now, almost most of these legal and professional fees were incurred in connection to the fees back. And much of the expenses were used in the extension of the spec before the completion.
Speaker Change: There's also another item that I need to elaborate a little bit.
Speaker Change: It's that there is an item called other income or ad laws. Right now we have booked ad laws.
Speaker Change: 2.2 million or 4 year 2024, but how are these 2.2 million?
There are many big items.
Number one is, do we have a gain on 20.5?
Speaker Change: Minion because we target GA and and and and so we have also diverse the its stats to
Speaker Change: to report. And there are a number of employment laws on the water-cooled triangle, TNGA, GAA, and intercomnet balance.
Speaker Change: which I think more or less will clean up most of the...
Speaker Change: Intangible assets or a good view so that we could have a fresh start to look at in 2023-5 year pet.
Now, um, in order to
To see how the company, what is the probability of truth or the probability of the company.
Speaker Change: We'd like to draw attention to the computer analysis.
Now, um...
Speaker Change: If you look at the total EBITDA for the full year 104, including the ANG, there was a loss of 261.5 million.
However, if you actually, the triangle and vertical,
There was a bit of profit for the financial law of $2.05 million.
Speaker Change: Now, there was a loss on TNG Asia and GA combined into the loss, but this will have no impact on the companies.
from the fourth quarter onward because they were already in the west.
Speaker Change: Now, one key element to look at is the headquarter expenses.
Speaker Change: and the EBITDA laws of 29.28 million. And that was the reason why the company has sustained such a big EBITDA laws.
Speaker Change: The hour of 259.8 million, 259 being the operating expenses for the recognition of the centrifuge, which I have explained.
Speaker Change: One million, also a non-tash item for recognition of shares given to Roth.
Speaker Change: and then there's a lost income loss of 3.2 million. Now in above you see that there was a income loss of 2.2 million.
Speaker Change: Because the headquarters actually incurred 3.2, but there was a game in the subsidiary level. That's why if you look at the headquarters level, there was a loss of 3.2 million.
Speaker Change: And there was a League of Expenses in Tenshwerse and Mokrosation, and so the real Rental General Expenses for the year was only 1.8 million.
Speaker Change: So, going forward, we're expecting that 1.8 million would be quite a record expenses.
Speaker Change: for the headquarters, because the headquarters has no real operations in it. So, the actual headquarters expenses will be including the D&O insurance, the auditing fee.
and also the direct-of-thee.
Speaker Change: The Chief Office of E, the Chief Office of Cary, something like that. So it should be in the range of 1.8 to 2 million.
Speaker Change: Now, for the year of 2010, if you look at the net laws, it was...
Speaker Change: 38.8 million. But again, it was contributed mostly by the net loss of 32 million by the headquarters and the adjustment.
Speaker Change: which I have explained before, and also there was a loss of 3.7 contribute by Kenji Asia and T.E.A. Now, again, as both Kenji A and T.E.A.
Speaker Change: We are now moving forward. We will focus our strategy, our core competency in the Krungo's Remittance Network and also in asserting our A.I. new initiatives.
Speaker Change: So, we believe that, number one, we have streamlined our portfolio.
So, as to enhance our top line growth
Speaker Change: and profitability. Number two, be a listed company. We can have increased brand recognition and we hope we can find more strategic partners to work with us.
So, um...
Speaker Change: We believe that from a macro perspective, the demand for digital remittance remains robust.
Speaker Change: But I think our AI initiatives can also create a whole lot of synergy.
Speaker Change: For the company, because we would help those financial institutions, especially in countries like the Middle East, like Africa.
Speaker Change: to shut up AI causing the AI HR training platform for them.
Bye.
Speaker Change: During this AI initiative, nearly put new clientele and this new clientele could also.
Speaker Change: We enrolled to become the clientele for our digital intelligence business.
Speaker Change: So we believe that the new AI business will create a whole lot of synergy.
Speaker Change: for the digital remittance. And right now we are getting a fresh start and we hope that we can execute this strategic transformation and capitalize on driving optimities in AI era.
So any question cursed?
Speaker Change: We will now begin the question-and-answer session. If you would like to ask questions at this time, simply press star number one on your telephone keypad. If you would like to return your question, press star one again.
Chris: I think I can briefly talk about AI transformation, but I keep my belief here.
Speaker Change: The audience would like to ask more questions on the earlier results, but let me finish on the AI transformation for the time being.
So now...
Speaker Change: What we also have been in the finance of the institution for quite a number of years.
Speaker Change: We know the pin points. There are a number of things that should be handled more efficiently and effectively.
And now that the AI is progressing so rapidly.
Speaker Change: So we believe that the financial services landscape should also change correctly.
Speaker Change: The one critical way for these financial institutions to transform and to become competitive.
Speaker Change: and to engage in more customer interactions or to improve the operating efficiencies.
Through the use of EI.
Speaker Change: So that we can provide the trading platform for these financial institutions.
Speaker Change: We can provide CURR Center so that they don't need to recruit a team of CURR Center staff to answer CURR's routine questions from the customers.
They can even have a team of AI staff too.
across cells to promote their products.
And also they have a team of AI to recruit.
Um, the.
The workers and trained the workers.
Speaker Change: Now there's also another angle that we want to focus on recruiting the employers.
Because there is a huge cause on this HRP comment.
Bye. Bye.
Speaker Change: We are now launched to AI4 higher, which can replace almost 90-something percent of the functions of all the HL departments.
Speaker Change: No matter where the talk about financial institutions or construction workers, construction developers.
Speaker Change: and our main target is actually helping those employees who have a lot of micro-locals.
Speaker Change: I like the construction workers, transportation workers who worked in PDHs.
Speaker Change: So imagine that if we can help them to serve the HR function to distribute the series to the staff and also.
Speaker Change: To help the staff to send money back to the home man. So it's a one-off thing that we are trying to achieve.
So these are all the...
Speaker Change: or the AI initiative that we are now trying to push ahead.
Speaker Change: There are something like AI, the AI data center, which can...
Speaker Change: which can solve the problem of computing power needs, but I think we could come across that later on if we have the more concrete.
Speaker Change: details. You guys can refer to the announcements we have posted.
So, um.
Let's...
Yes, thank you.
Operator, so we take Q&A now.
Speaker Change: Absolutely. Sorry for the interruption earlier. We will now begin the question and answer session. If you would like to ask a question at this time, simply press star. Followed by the number one on your telephone keypad. If you would like to withdraw your question, press star one again.
CURRENC Group
Bye.
Yeah.
Speaker Change: In your first question comes on the line of Andrew Scott with your odd capital, Andrew, please go ahead.
Hey, thanks for taking my questions and, hey, um...
How are you running? Congrats on the strong results.
Speaker Change: So, my first question here is to do around your announcement of your first customer for Seamlet AI.
Speaker Change: It's kind of wondering what your expectations were there for the partnership in 2025, maybe.
Speaker Change: When can we expect revenues and then also if you could just kind of update us on the pipeline of maybe other customers, potential customers you're talking with for the product and the staffer hire.
Now, we have in the announcement.
We have cut the deal with the accounting cost.
which is the financial institution in orbit.
Speaker Change: Now, we are now hindering the details, like the totals are up, the delete verbose.
Speaker Change: Centre. And it's very exciting and encouraging that actually we match with the
Speaker Change: Talk about helping the whole country, all the small and medium enterprises, whether they are the financial institutions or not.
and we can help these companies to move.
Speaker Change: Provide the service for AI higher and that AI stop for them.
Bye.
Speaker Change: So, yeah, I think as for the timeline, we hope that we can have a clear cut revenue screen in the second half, at least firstly from on cost.
We are expecting others to come.
Speaker Change: But given the negotiations and period and time, we might be expecting in the by the end of this year or early next year that we can hear more and more revenue stream from the AI services.
Speaker Change: as well as New Crimes there. And one important issue is we want to not just providing these companies with trading.
Speaker Change: Platforms because these financial institutions they have the licenses they may have the capital but they do not have the know how they don't know how to run the business and they have mostly do not have any experience on the
Speaker Change: So, how to conduct the digital intents, how to transact, how to to to to to to to go with it?
Speaker Change: So, one of our objectives actually is helping these financial institutions to make use of Angles Network in CROTIRA.
Speaker Change: in their home country. Now there are two ways to do it. One way it would be to
Speaker Change: to provide them with the infrastructure and and and and take up the fee. But we are more
Interest in co-share
Speaker Change: with them, the reference screen as well as the profit screen.
Speaker Change: They provide the licenses, they provide the clientele and we provide the infrastructure, and we launch a digital remittance through these financial institutions, and we take a share of the revenue stream or the profit stream.
So these are all we are trying to figure out.
Speaker Change: I give you an example of the retail players, typically they charge something like 1.5 to 2.5% while using a triangle as the corridors they only pay out 0.37%.
Speaker Change: Ask to go them into the meetings business there while we provide the platforms, we provide all the know-how, and we share the revenue.
But we're still in a very intense negotiation, so.
I could, I could not.
Speaker Change: This goes too much on this one unless we can begin an announcement.
Speaker Change: No, thank you. You provide a lot of great information there, so I appreciate it. Second one for me on the AI transition.
Speaker Change: The announcement in March regarding the 500 megawatt AI data center that looks like construction is planned for maybe the end of 2026. Can you kind of just talk about currency's role in the partnership. Any additional details.
around that announcement would be greatly appreciated.
Speaker Change: Yeah, you can't now. I totally understand and I can now move on to get some questions here on Tranglo.
Speaker Change: I know that the user is like this. We are now working closely with ARDC, very renowned operators.
Speaker Change: I couldn't disclose the name because we have to get their approval first and they have been doing the ARDC for most.
For quite some time, at least 10 years.
Speaker Change: Now, they will provide or the contest for us. They will provide or the...
Speaker Change: The technological support for us, we will be responsible for sourcing the land, the government support in Malaysia. And my view Alex is a Malaysian. He has a very good relationship from Malaysia.
Speaker Change: And then once we cut a deal with the crimes, we'll then work out with the local government to get the land and also to get the bank approval for the financing for such a.
A project.
Speaker Change: The project can be held for a good return, but it can also be sold out to investment fund. We have also lined up with a number of funds who are willing to take up
Speaker Change: is a long-term investment opportunity. We can work in a facilitator. We can also work [inaudible]
kind of thing.
Speaker Change: No, the background information there was very helpful. So shifting kind of to the...
The core businesses, yeah.
Speaker Change: Yeah, with CURRENC Group. So my first question, you know, the margins were very strong. Cake rate was reduced. You mentioned kind of some improvements to the tech stack in the call and some strong.
Speaker Change: you know cost improvements there so can you just kind of talk about the the larger trajectory of the business.
Speaker Change: Now the strategy is like this, so the market competition has to be very keen.
Speaker Change: So that's why the whole industry that take rates in declining. But last year or the year before we've been trying to capture more markets through low price strategy.
Speaker Change: But in since this year onward, we have been given the instruction to the management that they should not sacrifice with a tech rate so as to capture more markets. We want to
Speaker Change: We want to maintain our profitability. We want to maintain our...
Speaker Change: Our Refugee Stream. So this year, onward, we are the instruction the triangle came is that we want to see the operatic rate.
What am I out like at this level?
Speaker Change: And then secondly is we are setting a key PI for the management that we want to grow the Remacist Grappinields.
Speaker Change: at least by 12.5% this year. So the whole team is now working to increase the rate of remixes to revenue, the TPV without sacrificing the tick rate from this year onwards.
Speaker Change: As for the PLA, we've been trying to select more and more PLA agents, more and more price-competitive please our agent. So meaning that on one hand, we are under a price pressure from our
Speaker Change: Crimes, but on the other hand, you're exerting more and no price pressure on our PR agents. That's why the PR rate actually decreased from 0.15 to 0.12.
Speaker Change: But as a matter of fact, we believe that they are still.
Room for Earth Compressant on the PL agent.
For instance, if you choose...
Speaker Change: e-waters, then the PLB will be even lower. It will choose test pick-up on, then the PLB rate will be higher.
Speaker Change: One way to cut it is we would find more and more competitively world-fail engines.
Speaker Change: On that end, we will also approach more and more banks to get a lower PL agent fee from them.
Speaker Change: Thank you, you know, those great breakdowns. And last for me, if I may, before I jump back in the queue, you're talking about revenue growth in Tranglo. And I know a lot of that will hopefully come from traction in new geographies. So can you kind of talk about...
You know, your progress is expanding in a new country.
Speaker Change: Yeah, we have been trying to easily report that we should try to develop our own retail business in the United States, in Dubai, in Abu Dhabi, in Saudi. So it's to contribute more and more corridors, more and more users for a triangle.
Now we think that it's even more efficient.
and Dorothy Beckett for us to make use of AI solutions.
Speaker Change: So as to reach out to more clients like Konkhoff, like small finance institutions in Middle East.
in Africa so that they could become the new crimes.
Speaker Change: of Trango's corridor. So in this way, we could, on one hand, Europe , AI, new businesses and on the other hand, we are helping Trango to explore, explain its reach to the Middle East and other African countries.
Speaker Change: Great, well thanks again for taking my questions and congrats on my strong results.
Thank you, thank you.
Speaker Change: There are no further questions at this time. I will not turn the call over back over to Liz for closing remarks. Liz?
Liz: Thank you again for joining us today. If you have any further questions, please feel free to contact our Investor Relations team.
Liz: Now, that includes today's call and the company looks forward to speaking with you again soon. Thank you and goodbye. Thank you.
That concludes today's conference call. You may now, it is going to.