Sezzle books more sales growth as investors eye off Q4 BNPL reporting season

Sezzle (ASX:SZL) became the first BNPL cab off the rank with Q4 trading results in its market announcement this morning.

The company said underlying merchant sales (UMS) for Q4 came in at $419.8m, up 40.6pc from the September quarter (and triple the prior year period).

SZL said those sales flowed through to merchant fee revenue of $22.5m, (also around three times higher than Q4 2019).

That equates to a charge rate of 5.4 per cent, at the upper-end of the 3-7 per cent range that UBS applied to Afterpay (ASX:APT) sales in some of their 2020 research.

The company said it now has more than 2.2m active consumers, 89.8 per cent of whom were designated as repeat users.

Sezzle said that marked the 24th straight month of increases in return users, a metric it said is a “key driver to lower loss rates”.

SZL shares pushed further above $6 this morning with a gain of around five per cent.

The stock dipped to around $5.30 in December after hitting in August peak above $11 — a gain of around 3,000pc from its March lows.

Sezzle also highlighted an integration partnership with Wix, an Israeli software company listed on the NASDAQ that provides cloud-based web development services such as website building.

The deal will see Sezzle’s platform available for inclusion by Wix users across the US, Canada and India.

Sezzle CEO Charlie Youakim briefly flagged the company’s growth rates in Canada and India, which he said are “exceeding the US”.

The company’s sales summary didn’t provide an update on sales by region.

Along with its Wix partnership, Sezzle said it had also launched an initiative with Transunion, a NYSE-listed consumer credit reporting agency.

Using Transunion’s rating mechanism, Sezzle give customers who pay their instalments on time the opportunity to build a stronger credit score.

Sezzle is the first ASX-listed BNPL to report quarterly sales figures in the wake of the Q4 trading period, which including Christmas shopping season the the Black Friday/Cyber Monday sales promotion at the end of November.

It marks a key reporting period for investors in the sector, who will watching for evidence of ongoing growth rates following some huge 2020 share price rallies.

Sezzle said it will provide more details on its December quarter trading result with the release of its 4C filing on January 29.