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ASX 200 drops on return of lockdown in Melbourne

The S&P/ASX 200 Index (ASX: XJO) ended the day down 0.03% to 6,013 points. However, just before the Victorian press conference the ASX 200 was at 6,066 points.

Metro Melbourne has gone back to stage 3 restrictions. People will only be allowed for shopping for food and other essentials, medical purposes and caregiving, work and study if it can’t be done at home and exercise.

Here are some of the highlights from the ASX 200 today:

Afterpay Ltd’s (ASX: APT) big update

Afterpay was able to provide an update with the final quarter of FY20 finishing last week.

The buy now, pay later business said it has seen a strong performance across the business and delivered underlying sales of $11.1 billion in FY20, which was up 112% on the prior corresponding period.

Underlying sales in the fourth quarter of FY20 rose by 127% to $3.8 billion. This was the highest quarterly performance ever, which Afterpay said reflected the accelerating shift to e-commerce to spending since the impacts of COVID-19 emerged globally.

Afterpay said that margins were pleasing. Merchant revenue margins for FY20 are expected to be in line with or better than both the first half of FY20 and FY19.

The net transaction loss (NTL) for FY20 is expected to be up to 55 basis points. The Australia and New Zealand NTL has remained at historically low levels and the NTL within the US and UK regions has improved in the second half compared to the first half of FY20. There has been improving risk performance and historically high payment recovery rates.

The net transaction margin (NTM) for FY20 is expected to be approximately 2%, underpinning a pathway to longer term profitability for the overall business.

The ASX 200 share is expecting earnings before interest, tax, depreciation and amortisation (EBITDA), excluding significant items, for FY20 to be between $20 million to $25 million.

Active customers rose 116% to 9.9 million at the end of FY20. Active merchants rose by 72% to 55,400. Afterpay expects to expand into Canada in the first quarter of FY21. It’s also expecting to expand to in-store in the US this quarter as well.

Afterpay also announced a $800 million capital raising and a sell down by the co-founders where each of them will sell 2.05 million shares.

Magellan Financial Group Ltd (ASX: MFG) funds under management (FUM) announcement at June 2020

Magellan today announced its FUM for June 2020. The global fund manager said its FUM at the end of FY20 was $97.2 billion, down from $98.5 billion at 29 May 2020.

The ASX 200 fund manager experienced net inflows of $249 million, which included net retail inflows of $173 million and net institutional inflows of $76 million.

Average FUM for FY20 was $95.5 billion, an increase from $75.8 billion in FY19.

Magellan said it’s entitled to estimated performance fees of approximately $81 million for FY20.

Sezzle Inc (ASX: SZL) share price soars 24.6%

It was a big day for the buy now, pay later sector on the ASX today.

Sezzle announced that its underlying merchant sales (UMS) jumped 58% quarter on quarter to US$188 million. This was an increase of 349% year on year.

Active consumers rose 28% quarter on quarter to 1.48 million. Active merchants increased by 27% quarter on quarter to 16,112.

The BNPL businesses also said that its repeat usage improved by more than 10 percentage points to 87.5%, compared to 77.2% in June 2019. Older cohorts are using Sezzle more each year. The 2018 Sezzle cohort is now purchasing approximately 15 times a year.

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Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of AFTERPAY T FPO. The Motley Fool Australia has recommended Sezzle Inc. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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