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TB
Thankyou, very thought provoking
Hopefully more insight with TSL results on Thursday
I shall also be looking out at Companies House for ClearPay Finance Ltd (Co no 05198026.) accounts to 30/6/20 to see what can be gleaned. They were published last time on 24/6/20. There was a loan from APT of Ā£25m which increased to Ā£50m in Dec 2019 and paid interest at 3.75%. I'm expecting much more detail in them for 2020
Ps
APT could have a turbulent day on Monday following the selloff on Friday
I will be adding TSL if so
...thus paying a lower price and capturing more growth for themselves.
Afterpay have published a very informative presentation relating to their H1 2021 results. Helpfully, the presentation provides details of regions, customer spending and customer numbers.
Here's a plot spoiler:
The Afterpay group has grown considerably.
The Clearpay part of Afterpay has grown astronomically.
Clearpay is now a much bigger portion of the group than it was 12 months ago. The ThinkSmart stake in Clearpay has increased substantially in value.
Having spoilt the plot, here's a few of the figures to give some detail to the assertions above.
Afterpay sales have increased by 106% to A$9.8bn from A$4.7bn.
Clearpay sales have increased by 288% to A$785m from A$202m.
As a proportion of group sales, Clearpay has increased to 8% from 4%.
In regards to active customers:
Afterpay customers have increased by 80% to 13.1m from 7.3m
Clearpay customers have increased by 812% to 1.6m from 400k
Helpfully, the presentation gives some details as to how the spending patterns of customers develop over time. In the first year, a new customer will make 4 transactions; second year 11, third 16 and fourth 21. It seems customers become more confident with BNPL and more confident with their ability to manage their money.
On top of the increasing transactions, the presentation also shows that the value per transaction also increases over time.
Simple calculations with the customer and spending figures show group spend per customer of A$749 in H1 2021.
Clearpay is A$490 in the same period. If this represents 4 transactions, then each is valued at A$122.
If we assume that all of the current Clearpay customers have started during the last 12 months, they will have made 4 transactions each. Next year they will make 11. In the absence of any customer growth then the collective spend will be 1.6 million x 122 x 11 = A$2,147m
Rather than static customer numbers we can, perhaps, try to account for some growth here too. A Google search gives population figures for Australia and New Zealand as 25.8m and 4.9m respectively. A combined population of 30.7m. With ANZ having 3.4m active customers that's around 10% of the population. Applying that metric to the UK population would give around 6m customers.
If we guesstimate an increase of 1m UK customers in the next twelve months, this new cohort will spend 1m x 122 x 4 = A$488m.
Combining the two spending figures gives a total UK spend of A$2,635m.
I doubt if any of the figures I've used will be the outcomes that occur. I do, however, think that as an illustration of a possible future that the direction of travel is clear: Clearpay is becoming a bigger part of Afterpay; Clearpay is becoming more valuable.
My view is that the growth outlined above poses a dilemma for Afterpay. Do they hang on until the call option in August 2023 and pay a higher price for the part of Clearpay they don't currently own or do they seek to buy the remainder of Clearpay early thus