Sezzle (ASX:SZL) share price flat despite $30 million loss

Here's how the six month ended 30 June 2021 went for Sezzle.

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The Sezzle Inc (ASX: SZL) share price is flat despite the company reporting its losses increased over the first half of 2021.

Right now, the Sezzle share price is $6.42, the same as it was at Friday's close.

Sezzle share price up despite $30 million loss

 Here's how the buy now, pay later provider performed over the 6 months ended 30 June 2021:

  • After-tax loss of US$30.4 million, compared to a US$8.2 million loss for the prior comparative period
  • US$53,876,000 total income, up 159%
  • Total income for the half year came to US$53.8 million, an increase of 159%
  • Underlying merchant sales of US$786.2 million, a 156% increase

The company reported it received US$46.4 million of Sezzle income in the first half. Of that, US$44.4 million, or 95.8%, came from merchant fees.

It also recognised it received a total of US$7.5 million from account reactivation fees.

The company's transaction expenses were US$18.5 million and its payment processing costs were US$13.5 million.

Those figures represent a 102% increase in costs for the six months ended June 30, 2021, mostly due to an increase in volume of orders transacted by consumers.

Sezzle incurred merchant affiliate program and partnership fees when consumers make purchases with merchants who were referred by another merchant or are associated with a partner platform. These fees equalled a total cost of US$3.2 million.

Total provision for uncollectible accounts was US$22.4 million for the first half of 2021. As a percentage of Sezzle income, the provision for uncollectible accounts was 48.3%.

What happened in the first half for Sezzle?

It's been a busy half year for Sezzle and its share price.

The company entered a proof on concept with the USA's Target, sending its share price a massive 22% higher.

Additionally, it partnered with Ally Bank to offer longer term loans on bigger ticket items than its original platform did.

It also entered an agreement with payment provider Discover. Discover and Sezzle teamed up to allow some of Discover's merchants to offer BNPL services through Sezzle.

Sezzle also saw its number of active merchants increase by 150% compared to the amount it had signed up in the first half of 2020. As of 30 June 2021, Sezzle has 40,274 active merchants. Sezzle states it doesn't depend on any one merchant for more the 7% of its merchant-related fees.

It also saw a 96% increase in its number of active customers. At the end of the half, it had 2,883,825 active users.

Additionally, Sezzle's repeat usage reached 91.6% in the first half of 2021.

Sezzle share price snapshot

The Sezzle share price gained 40.5% over the six months ended 30 June 2021.

It has since fallen 26.9%. Right now, the company's share price has gained 2.7% year to date and has fallen 37.2% since this time last year.

Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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