Afterpay Touch shares are at a record high after the-buy-now-pay later service revealed its underlying annual sales are on track to reach more than $2 billion and flagged a potential foray into the US. In the three months to December 31, Afterpay’s underlying quarterly sales hit $551 million, up from $367 million the previous quarter. Sales for the first half of the current financial year were $918 million, Afterpay said on Tuesday, releasing unaudited figures in an update to the ASX. Its underlying sales are now tracking at more than $2 billion on an annualised basis, the company said.
Afterpay Touch also announced was it was exploring expansion into the US market. The company’s shares closed up 16.9 per cent at $7.62, the highest level since the company listed on the ASX in June, 2017, at $2.50. It is rapidly growing its customer base, which was more than 1.5 million by the end of second quarter FY18, an increase of 400,000 on the previous three months. It has also lifted its number of merchants to 11,500, from 8,700 the prior quarter. US-based venture capital firm Matrix Partners will invest $US15 million ($A18.8 million) in the company and Matrix general partner Dana Stalder has been invited to join the Afterpay Touch board. “The market dynamics that provided the opportunity for Afterpay’s launch and rapid growth profile in Australia and New Zealand appear just as prevalent in the United States,” the company said.
“These dynamics relate to a number of macro factors including the retail culture and growth of online commerce, as well as millennial trends in relation to lifestyle, shopping, finance and payments.” Afterpay pays the retailer for a purchase, and the customer pays fortnightly instalments to Afterpay, with the benefit of no interest payments or up-front fees for up to 56 days. Afterpay is the largest but not the only service of its kind in Australia, with Zip Pay, Ezypay and zipMoney among other buy now-pay later platforms in the market.
By – MELISSA JENKINS – Australian Associated Press
ARTICLE SOURCE – www.theaustralian.com.au