Metalpha Reports Fiscal Year 2023 Financial Results

Rhea-AI Summary

Metalpha Technology Holding Limited (Nasdaq: MATH) reports $382 million in derivative products issued and $5.7 million income for FY 2023.

Financial Analyst

Metalpha Technology Holding Limited's financial results reveal a notable notional amount of $382 million in derivative products issued under its wealth management arm. This figure is significant as it reflects the volume of derivatives that the company has structured and sold, which is a key revenue driver in the wealth management sector. The generated income of $5.7 million, while modest, indicates a stream of revenue that could impact the company's profitability. However, the adjusted loss reported suggests that despite the revenue from derivatives, the company's overall financial performance may be under pressure.

From an investment perspective, stakeholders should consider the company's ability to manage risk associated with its derivative products. Derivatives can be complex and carry a high level of risk and the company's expertise in managing this risk could be a critical factor in its long-term success. Additionally, the reported loss may affect investor sentiment and could lead to volatility in the company's stock price. Investors would benefit from understanding the specific factors contributing to the loss and the company's plans to return to profitability.

Market Research Analyst

Examining Metalpha's performance in the context of the broader digital asset-based wealth management industry, the reported notional amount of derivative products is indicative of the company's competitive position. While digital assets are a relatively new and rapidly evolving sector, the demand for wealth management services in this space is growing. The company's ability to issue a substantial volume of derivative products suggests it has captured a portion of the market demand.

However, the overall health of the digital asset market and regulatory changes could significantly impact Metalpha's business model. Market research would be required to assess the sustainability of demand for such financial products and services. Additionally, the company's ability to innovate and adapt to market changes will be crucial for its long-term growth and market share retention.

Economist

The financial results reported by Metalpha also have broader economic implications. The performance of companies within the digital asset sector can serve as an indicator of the sector's maturity and integration into mainstream finance. The fact that Metalpha has managed to generate income from derivative products suggests there is an economic appetite for such instruments, which could encourage further financial innovation.

However, the adjusted loss also highlights the economic challenges faced by companies operating in this nascent industry. It raises questions about the scalability and profitability of business models centered around digital assets. Economic analysis would focus on the long-term viability of such companies in the face of potential market saturation, regulatory hurdles and economic cycles that could influence investor confidence and capital allocation.

HONG KONG, Feb. 15, 2024 /PRNewswire/ -- Metalpha Technology Holding Limited (Nasdaq: MATH) (the "Company" or "Metalpha"), a global digital asset-based wealth management company, announced financial results for the fiscal year ended March 31, 2023 (the "FY 2023"). The Company reported the notional amount of derivative products issued of $382 million under its wealth management business arm, which generated fiscal-year income of $5.7 million. The adjusted loss of the Company in FY 2023 was about $0.7 million.

The Company recorded strong year-over-year growth driven by its wealth management business, a key pillar of its operations and revenue model. The Company designs and issues derivative products for institutions and professional investors and recognizes the fair value change of (i) trading of digital assets and derivative contracts and (ii) investment in trusts as income from our wealth management business.

Metalpha prides itself on being one of the world's largest digital asset-based derivative trading firms. The notional amount of derivative products issued in FY 2023 was $382 million compared to only $49 million in the fiscal year ended March 31, 2022 (the "FY 2022"). The income from the wealth management business jumped from $0.1 million in FY 2022 to $5.7 million in FY 2023.

Metalpha aims to provide qualified investors with high-quality product design and trading capabilities and is committed to delivering structured derivative products to cryptocurrency market participants.

"We are pleased to see strong demand for customized products and earn high customer satisfaction. The fast growth of our wealth management business indicates the market's confidence in our business approach. We strive to design products and services with compliance at the core. In the new year, we are confident about the improving market conditions which could lead to stronger demand for our derivative product subscriptions.

At the company level, we aim to maintain a high growth rate and significantly lower expenses as our business scale expands. We will also continue to innovate and diversify our business offerings in a bid to expand our market share in Asia," said Adrian Wang, President of Metalpha.

FINANCIAL HIGHLIGHTS

Notional Amount of Derivative Products Issued

	FY 2022	FY 2023
Notional Amount of Derivative Product Issued	49 million	382 million

Income from Wealth Management Business 

	FY 2022	FY 2023
Income from Wealth Management Business	0.1 million	5.7 million

Adjusted Loss to the Company

	FY 2022	FY 2023
Loss of the Year	(14,428,033)	(20,167,351)
Add: Equity-settled share-based payments under share award scheme	1,468,800	1,045,315
Add: Share purchase warrants expenses	6,063,086	10,176,995
Add: Total loss from discontinued operation	3,193,385	8,248,013
Adjusted Loss	(3,702,762)	(697,028)

The Company filed its annual report on Form 20-F for the FY 2023 (the "2023 Annual Report") with the U.S. Securities and Exchange Commission on February 12, 2024. The 2023 Annual Report included audited financial statements for the FY 2023. The 2023 Annual Report is available online at www.sec.gov.

About Metalpha Technology Holding Limited

Founded in 2015, Metalpha Technology Holding Limited (NASDAQ: MATH) went public on October 20, 2017. The listed Company is dedicated to providing investing and wealth management services with a full-service, institutional-grade platform. With dedicated blockchain expertise, the Company aims to become a leader in the field of crypto wealth management services, bringing robust innovation and transparency to the customers and businesses it serves.

Safe Harbor Statement

This press release contains statements that may constitute "forward-looking" statements pursuant to the "safe harbor" provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as "will," "expects," "anticipates," "aims," "future," "intends," "plans," "believes," "estimates," "likely to" and similar statements. Management has based these forward-looking statements on its current expectations, assumptions, estimates and projections. While they believe these expectations, assumptions, estimates and projections are reasonable, such forward-looking statements are only predictions and involve known and unknown risks and uncertainties, many of which are beyond management's control. These statements involve risks and uncertainties that may cause Metalpha's actual results, performance or achievements to differ materially from any future results, performance or achievements expressed or implied by these forward-looking statements.

Non-IFRS Financial Measure

The Company uses adjusted loss for the period, which is a non-IFRS financial measure, in evaluating its operating results and for financial and operational decision-making purposes. Metalpha believes that adjusted loss helps identify underlying trends in the Company's business that could otherwise be distorted by the effect of certain expenses that the Company includes in its loss for the period. Metalpha believes that adjusted loss for the period provides useful information about its results of operations, enhances the overall understanding of its past performance and future prospects and allows for greater visibility with respect to key metrics used by its management in its financial and operational decision-making.

Adjusted loss for the period should not be considered in isolation or construed as an alternative to loss for the period or any other measure of performance or as an indicator of its operating performance. Investors are encouraged to review adjusted loss for the period and the reconciliation to its most directly comparable IFRS measure. Adjusted loss for the period presented here may not be comparable to similarly titled measures presented by other companies. Other companies may calculate similarly titled measures differently, limiting their usefulness as comparative measures to the Company's data. Metalpha encourages investors and others to review its financial information in its entirety and not rely on a single financial measure.

Adjusted loss for the period represents profit for the period excluding (i) equity-settled share-based payments under the Company's share award scheme, (ii) share purchase warrants expenses (i.e. expenses in relation to the issuance of warrants to certain consultants, employees and business partners); and (iii) loss from discontinued operation.

The table captioned "Reconciliations of Non-IFRS Measure to the Nearest Comparable IFRS Measure" included at the end of this announcement contains a full reconciliation of adjusted loss for the period to loss for the period.

Media Contact

Yiwei Wang
info@metalpha.finance

View original content:https://www.prnewswire.com/news-releases/metalpha-reports-fiscal-year-2023-financial-results-302063042.html

SOURCE Metalpha Technology Holding Limited

FAQ

What is the notional amount of derivative products issued by Metalpha in FY 2023?

Metalpha issued $382 million in derivative products in FY 2023.

How much income did Metalpha generate in FY 2023?

Metalpha generated $5.7 million in income in FY 2023.

What was the adjusted loss of Metalpha in FY 2023?

The adjusted loss of Metalpha in FY 2023 was not provided in the press release.