Fintech Zip Co cuts loss in half

In FY20 the company plans to launch instalments for business, secure strategic deals with banks and partners, enter everyday spend categories, and oversee the launch of its recently acquired PartPay in the UK.

With buy-now pay-later (BNPL) players in a frantic race against time to capture international market share and brand recognition, profit is still an afterthought for the likes of Afterpay (ASX: APT) and Zip Co (ASX: Z1P).

But for the latter this year was a bit different. In its results announced today, Zip highlights an EBTDA of $9.2 million in FY19 compared to a loss of $8.8 million in FY18.

The company still reported a loss before income tax of $11.1 million, but this is a significant improvement on the $22.5 million loss recorded in the previous year.

This improvement been driven by a very strong result with revenue up 138 per cent at $84.2 million and customer numbers rising 80 per cent to more than 1.3 million.

Customers are paying off their entire balance in seven to eight months on average, while net bad debt write-offs were 1.63 per cent compared to 2.61 per cent in FY18.

In a bid to keep up momentum, on Tuesday Zip Co announced it had reached a deal to buy New Zealand company PartPay, which has operations in NZ as well as the United Kingdom, the United States and South Africa.

The Sydney-headquartered fintech saw its transaction volume more than double to $1.13 billion in FY19, and it is targeting that figure to hit $2.2 billion in the current financial year with a goal to have 2.5 million customers on the books.

To read more, please click on the link below…

Source: Fintech Zip Co cuts loss in half