The Sezzle Inc (ASX: SZL) share price has dropped lower in morning trade following the release of a coronavirus update.
At the time of writing the buy now pay later provider's shares are down 5% to 76 cents.
What did Sezzle announce?
This morning the Afterpay Ltd (ASX: APT) rival released an update to the market outlining its response plans to the coronavirus outbreak.
According to the release, starting on March 13, Sezzle implemented a mandatory work-from-home policy, suspended all business travel, and promoted the principle of social distancing to its employees.
The company revealed that it has also allowed for unlimited sick time for any employees experiencing symptoms related to COVID-19.
Positively, these operational changes are not expected to negatively impact the running of its business whilst these adjustments are undertaken.
It isn't just its employees that Sezzle is looking after. The company revealed that to support its shoppers, it is expanding its fee forgiveness and payment flexibility programs.
It will give every Sezzle shopper the ability to utilise two free reschedules of payments on their orders during this difficult time.
How is the business performing?
The release advises that Sezzle's business operations have continued through the spread of the virus with relatively no impact.
It revealed that its Underlying Merchant Sales (UMS) in February reached a record high of US$40.2 million with a positive Net Transaction Margin. The UMS for February represents a 319% increase over the same month last year.
And while the company has seen a small impact on its support systems, in the form of a slight increase in ticket volumes, it believes this is primarily due to the supply chain impacts of the outbreak.
Management notes that it had US$35.2 million in cash and cash equivalents at the end of January and a US$100 million credit facility available to support its growing business operations. This facility is 20% drawn and can support significant UMS payment growth.
Charlie Youakim, Sezzle's CEO, said: "The COVID-19 pandemic that is currently unfolding puts everything into perspective. We are in a global health emergency, and our priority is to make sure that we're doing everything we can to help with the response. Our business is in a strong position, which allows us to help others. We will do our best to support our stakeholders as we all work through these events."
"We will also continue to monitor early indicators with our Sezzle shoppers to understand what the impact of COVID-19 means for them. Our short-term loan duration limits our risk exposure in scenarios like this. Our digital systems also allow us to make quick changes to our underwriting models to adjust to a fluid economic situation," he added.
