QuickFee Ltd (ASX: QFE) shares dropped this morning after the company released its Q1 business update. At the time of writing, the QuickFee share price is down 3.67% to 52 cents.
Let's see how the company tracked for Q1 FY21 and why the QuickFee share price is falling.
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What's driving the QuickFee share price lower?
The QuickFee share price is falling lower after the company announced a mixed first quarter result for the period ending 30 September. The payment and lending solutions company achieved rapid growth into the United States market. Lending was up 91% to US$4.1 million on the prior corresponding period. The surge in demand was driven by a combination of new firm activations and increased lending from existing firms. This represents the company's fourth consecutive quarter of record lending in the US.
In addition, transaction volumes continued to benefit from the accelerated shift to online payments, in particular, electronic invoices. This reflected a 215% jump in the number of transactions to 63,000 compared to Q1 FY20. In total, transaction value in the US came to US$127.2 million, up 213%.
Across the Pacific, however, QuickFee said the government stimulus measures designed to help combat the economic effects of COVID-19 heavily impacted its results in Australia. Lending declined by 41% to $6.4 million as cash flow for small to medium-sized businesses received JobKeeper and other tailored financial packages. QuickFee anticipates that when government supports unwind, normal levels of funding will return.
What did the CEO say?
QuickFee CEO Bruce Coombes said due to it first mover advantage in the US market, the company has achieved rapid growth in its lending and platform transactions.
Mr Coombes also mentioned QuickFee's partnership with Splitit Ltd (ASX: SPT) which looks to launch its product in mid-October. He said:
In addition to the structural tailwinds benefiting QuickFee in the US, the launch of the new 'interest free' product in partnership with Splitit represents a major growth opportunity. An additional 650,000 accounting and law firms in the US, along with new market segments and geographies are now target firms for QuickFee's suite of products.
The build of the receivables management system and e-invoicing product for the US market is expected to be launched this quarter. This remains a major development for QuickFee and is expected to help further drive take-up of QuickFee's lending product.
New CFO appointment
QuickFee announced the appointment of Simon Yeandle as chief financial officer, who has started the position today.
Mr Yeandle is a chartered accountant with more than 25 years of experience in software-as-a service (SaaS), fintech, and media organisations. His previous roles include CFO of businesses such as oOh!media Ltd (ASX: OML) and 3P Learning Ltd (ASX: 3PL). Mr Yeandle is recognised for leading the finance function which oversaw a number of successful acquisitions and debt/equity raising projects.
Mr Coombes welcomed the CFO appointment, saying:
Given Simon's significant experience in senior financial roles and high growth companies, we are very excited to welcome him to the QuickFee team and look forward to his contribution to continue our rapid growth.
