Afterpay Touch Group Ltd (ASX: APT) shares are in a trading halt on Thursday morning, after announcing it will launch a $108 million capital raising to fund international expansion to the UK.
The funds raised will be used to acquire 90% of the issued shares in ClearPay.
ClearPay is a UK based payments company through which customers can purchase items up to £450 (~A$793) in value and make repayments in three interest-free monthly instalments.
“The acquisition of ClearPay will allow Afterpay to accelerate its entry into the UK market and enable further deployment of Afterpay’s global system,” the company said.
The company is continuing its expansion into new and existing international markets, underpinned by continued strong performance and growth in Australia and New Zealand.
Afterpay launched in the US in May 2018, with underlying sales (GMV) of approximately A$12 million in June and A$20 million in July. The momentum is continuing, with over 800 retailer contracts signed to date, over 400 merchants currently transacting on the US Afterpay platform, and over 150,000 registered US-based customers having transacted to date.
The raising will be completed today, with Afterpay shares expected to return to trade on Friday morning.
Full-Year Results Highlights
The equity raising was announced at the same time as the company reported its full-year results with the company posting group revenue and other income in FY18 of $142.3 million, up 390% on FY17.
The group recorded a statutory loss before of $7.6 million, down 47% from a loss of $14.4 million in FY17. Excluding significant items, group EBITDA was up 468% to $33.8 million while EBTDA was up 380% to $27.7 million.
The company will not pay a dividend for the period.
The company says growth in Afterpay underlying sales and a stable merchant revenue margin boosted results. In FY18 underlying sales were over $2.18 billion, up 289% on FY17.
Integrated merchants continued to grow strongly up by 176.7% from 6,000 merchants reported at 30 June 2017 to approximately 16,600 current live merchants at 30 June 2018.
Afterpay reported its customer base continues to grow. It has approximately 2.2 million unique registered end-customers and more than 92% of customers are active and returning customers.
Since the beginning of 2018, the Afterpay Touch Group Ltd share price has gained over 210%, compared to the S&P/ASX 200 Index, which has gained 3.13% in the period.