Hot on the heels of the Afterpay Touch Group Ltd (ASX: APT) result earlier this week, buy now pay later rival Sezzle Inc (ASX: SZL) has just handed in its report card.
How did Sezzle perform in the first half?
For the six months ended June 30, Sezzle reported underlying merchant sales (UMS) of $70.2 million. This was a significant increase from the prior corresponding period when the company reported UMS of just $4.5 million.
This strong UMS growth was driven by a material increase in its active customers from 26,724 in the first half of FY 2018 to 429,898 at the end of the first half of FY 2019. The strong growth has continued since then, with active customers rising to 496,307 as of July 31.
Supporting this growth was an increase in active merchants on the Sezzle platform from 815 a year ago to 5,048 at the end of June. And as with customer numbers, active merchants have increased since the end of the half and reached 5,793 at the end of July.
This ultimately led to the company reporting total income of $4.3 million for the first half. This comprised Sezzle income of $3.6 million and end-customer other income of $0.7 million.
Unfortunately, though, Sezzle reported a Net Transaction Margin (NTM) of -0.3% during the half, compared to 1.2% for the prior comparative period. Management advised that the change in NTM was driven by the mix in payment methods by end-customers. Sezzle began accepting credit and debit cards as a form of payment during the second half of 2018, which carry high associated processing costs.
Charlie Youakim, Executive Chairman and CEO of Sezzle, said: "The first half of 2019 was very successful for Sezzle on many fronts. We've seen a strong increase in customer and merchant accounts in addition to our revenue growth. We believe that Sezzle is on the leading edge of an international installment payments mega-trend that has only just begun to take shape."
"The half saw our launch into the Canadian market and our successful IPO on the ASX in July which raised over $35 million. This investment capital has already helped us accelerate our rapid expansion into our current North American markets. We have begun the second half of the year strongly as we continue to build on the momentum that we've already established," Youakim added.
