APT - Afterpay Limited

[Knobby22]

I totally understand it is a type of lay buy system where you can take the goods on the day as opposed to a traditional lay buy where you have to pay off the total amount before taking possession of the item.

And I agree it is better than using a credit card or O/D.

It is still a form of credit and it still encourages spending beyond ones means as opposed to saving up and then purchasing.

@Knobby22 Good info on the process for non payments, cheers

I actually think APT is a great business but IMO it is currently over valued especially in this retail climate..... in saying that it is on my " stocks to buy in a crash watch list"

Valuation is a judgement call.

The metric that is most important for the valuation is growth, especially internationally. If that slows then it is overvalued. If it is stellar it may be undervalued.
The next report will be very interesting.

 

[fergee]

Valuation is a judgement call.

The metric that is most important for the valuation is growth, especially internationally. If that slows then it is overvalued. If it is stellar it may be undervalued.
The next report will be very interesting.

Aye mate valuation is like beauty "in the eye of the beholder"

 

[frugal.rock]

I have no problem with a provider of services or goods making a profit. In fact I'd prefer that to be the case. They'll be there next time if I wish to utilise them. I just don't like subsidising others' indulgences

Sorry Dona, I wasn't being nice yesterday posting that.... don't know why I did that.
Crickets chirp...

For the retailer, it's another POS payment method.
Yes, they get charged fees.
Don't quote me on this, but I think many retailers are happy to have the extra payment method because of the extra business it brings, which offsets the fees, and them some.

Credit, lay buy... debt, call it what you will.
It's an alternative, to every other product out there.
It's right for some, not others.
Pretty sure the right for some, is the younger generation.
Look mum, my first debt system...
and anything up to maybe 30yr olds?

Young people don't stay young, population growth...if the BNPL product models stick, and manage to keep appealing to the young'uns,
it's going to be like them... growing, year by year, a few ups and downs to be expected.
The take-up of BNPL systems world-wide, is increasing. What can you do? It's a happining thing.

If it's just another payment method, yes, I would haggle as well, just depends on the shop.
Always have to have a haggle at Hardly Normal, Gerry probably factors it in to his prices...

F.Rock

 

[bigdog]

ASX announcements today

"Half Year Results Commentary" (uploaded below)

Results highlights for the half year ended 31 December 2019 (NZ$)1,2,3
• Total revenue of $806.7 million, an increase of 31.6%
• EBITDA4 of $263.2 million, an increase of 20.5%
• Net profit after tax of $184.9 million, an increase of 21.1%
• Basic earnings per share (EPS) of 25.15 cents, an increase of 20.6%
• EBITDA to sales margin of 32.6%, better than expected
• Operating cash flow of $160.6 million and a closing cash balance of $618.4 million
• Marketing investment of $84.1 million targeting opportunities in China and the USA
• Group infant nutrition revenue of $659.2 million, up 33.1%
• Strong growth in China label infant nutrition, with sales doubling to $146.7 million and distribution expanded to 18,300 stores
• USA milk revenue more than doubled and distribution expanded to 17,500 stores

Outlook FY20
Mr Eisen appears confident the company is well-positioned to exceed its medium term growth targets.

He said: “We are now focused on exceeding our mid-term underlying sales target of over $20b by FY22 and we are aiming to reach 9.5 million active customers by the end of this financial year.”

Though, this will come at a cost. He explained: “While this will impact Group profitability in the short term, we expect to achieve higher profitability in each market as they mature over time, in-line with our ANZ experience.”

“We believe we have the right strategy, the right people and the right business model to continue our momentum and deliver long term value for our shareholders,” he concluded.

Given the COVID-19 situation, A2M are assessing the level of discretionary marketing investment and trade marketing activation that can be effectively deployed in China for the remainder of the fiscal year.

580

 

[fergee]

View attachment 100787


ASX announcements today
View attachment 100785

"Half Year Results Commentary" (uploaded below)

Results highlights for the half year ended 31 December 2019 (NZ$)1,2,3
• Total revenue of $806.7 million, an increase of 31.6%
• EBITDA4 of $263.2 million, an increase of 20.5%
• Net profit after tax of $184.9 million, an increase of 21.1%
• Basic earnings per share (EPS) of 25.15 cents, an increase of 20.6%
• EBITDA to sales margin of 32.6%, better than expected
• Operating cash flow of $160.6 million and a closing cash balance of $618.4 million
• Marketing investment of $84.1 million targeting opportunities in China and the USA
• Group infant nutrition revenue of $659.2 million, up 33.1%
• Strong growth in China label infant nutrition, with sales doubling to $146.7 million and distribution expanded to 18,300 stores
• USA milk revenue more than doubled and distribution expanded to 17,500 stores

Outlook FY20
Mr Eisen appears confident the company is well-positioned to exceed its medium term growth targets.

He said: “We are now focused on exceeding our mid-term underlying sales target of over $20b by FY22 and we are aiming to reach 9.5 million active customers by the end of this financial year.”

Though, this will come at a cost. He explained: “While this will impact Group profitability in the short term, we expect to achieve higher profitability in each market as they mature over time, in-line with our ANZ experience.”

“We believe we have the right strategy, the right people and the right business model to continue our momentum and deliver long term value for our shareholders,” he concluded.

Given the COVID-19 situation, A2M are assessing the level of discretionary marketing investment and trade marketing activation that can be effectively deployed in China for the remainder of the fiscal year.

580

Hey @bigdog love what you do man and really appreciate it but I think we have half APT half A2M posted above?

 

[bigdog]

Share price now up 2.36%

SP two minutes ago Share price was up 1.47%

 

[barney]

Share price now up 2.36%

Currently up 3% today ….

I'm no fundamentalist, and I know the Company is positioning itself for growth …. but ….

Given they turned over almost $5 billion in the Half Year, and still lost $31 million … and ...

Their Balance sheet is predominantly made up of recent Cap Raising efforts.

Is there any cause for concern that they are biting off too much too quickly?

 

[Knobby22]

Nope
Their customers and merchants are increasing greatly, this cost money to sign up, set up the systems etc.
Their losses are reducing. They are now profitable in Australia. The US customers are now more than the ANZ customers. All metrics are improving.
Once they stabilise the profits will be large but first they need to grow for a couple more years.

Very happy.

 

[sptrawler]

Currently up 3% today ….

I'm no fundamentalist, and I know the Company is positioning itself for growth …. but ….

Given they turned over almost $5 billion in the Half Year, and still lost $31 million … and ...

Their Balance sheet is predominantly made up of recent Cap Raising efforts.

Is there any cause for concern that they are biting off too much too quickly?

View attachment 100792

Given that they turned over $5 billion and what is their take 3%?, how come the loss, I'm not following them but that seems like a lot of income for a loss.
Especially when you consider they are an online platform.

 

[barney]

Very happy.

I hope you're right Knobby ….

They have certainly had no trouble getting heavy hitters to 'loan' them lots of cash which is a big vote of confidence.

On the flip side, with a $9.5 billion market cap they have some catching up to do when they do become cashflow positive.

Too scary for me … I'll stick to my $4 million micro Specs where its safe

 

[fergee]

APT's long term trend still seems to be intact.

It is still trading in the trend channel and hasn't broken through its weekly 55ma.

IMO it looks like there could be a support level around the $28 region if this breaks the low $20's could well be on the cards.

This is one of the stocks on my crash watch list to buy for the long term, once I feel there is good value for me in it.

 

[Ferret]

2 months since the SPP and APT now cheaper than the SPP price. Amazing how things can turn.
And now that they are at these prices I don't want them! Well, not yet.

I always wondered how the business model would go in a recession. I guess we'll find out over the next six months.

 

[Knobby22]

Yes, I sold mine 3 weeks ago with most shares.
My concern is that if we enter a severe recession/depression then no one will buy anything so Afterpay sales will go through the floor. My second concern is that we enter a new Depression.

 

[Ferret]

Yes, I sold mine 3 weeks ago with most shares.

Well done Knobby. You're a better investor than I am!

 

[barney]

Yes, I sold mine 3 weeks ago

Well done Knobby ….. Great to be able to look at something in hind sight and know you made an excellent decision in real time

 

[aus_trader]

Funny that Guys, Knobby was still cheering on the APT story on the 27th of this month as can be seen from the earlier comments while he sold out ha ?

Nope
Their customers and merchants are increasing greatly, this cost money to sign up, set up the systems etc.
Their losses are reducing. They are now profitable in Australia. The US customers are now more than the ANZ customers. All metrics are improving.
Once they stabilise the profits will be large but first they need to grow for a couple more years.

Very happy.

 

[Knobby22]

Funny that Guys, Knobby was still cheering on the APT story on the 27th of this month as can be seen from the earlier comments while he sold out ha ?

Yea, fair call.
It was one of the last, must have waited for announcement. Apologies I didn't post my sell next day after saying good things about the company.

Upload contract.

 

[aus_trader]

Yea, fair call.
It was one of the last, must have waited for announcement. Apologies I didn't post my sell next day after saying good things about the company.

Upload contract.

All good Knobby22, it wasn't meant to specifically target you. Apologies if it came across as such, it's just that posters say they bought at the bottom or sold out near the top without proof.

Not to mention, some fundies (the cheating ones) keep on "Buy", "Undervalued", "Accumulate" ratings and get journalists to publish highly bullish stories about specific companies to get us, the poor retail suckers to put on the bids while they smartly sell out of their positions to us and book in profits.

 

[Knobby22]

I feel a bit bad though, not posting I sold them.
I sort of sold nearly everything over 3 days. (Couldn't do it over one day- (too thick) - and then just stopped posting on shares and just commented on the Coronus financial implications thread where I joined qldfrog as an absolute bear.

 

[bigdog]

ASX announcement today
17/03/2020 9:02:19 AM US Regulatory Settlement