Spenda (ASX:SPX) secures $50m debt facility as cash receipts grow

• IT services and lending company Spenda (SPX) reports $693,000 in cash receipts for the June quarter, marking a 10 per cent increase on the prior quarter
• This takes cash receipts for FY22 to $2.3 million, which represents a 107 per cent year-on-year growth
• The company’s lending portfolio remained stable with a balance of $12.1 million as of June 30, and further capital is expected to be deployed thanks to a new debt warehouse facility
• The $50 million facility was announced today for a three-year term, and Spenda believes it will help to accelerate business growth
• Spenda shares are down 17.65 per cent to 1.4 cents per share at 1:49 pm AEST

IT services and lending company Spenda (SPX) has reported $693,000 in cash receipts for the June quarter, marking a 10 per cent increase on the prior quarter.

This result takes cash receipts for FY22 to $2.3 million, representing 107 per cent growth compared to the 2021 financial year.

Annual recurring revenue (ARR) continued to grow and now makes up 95 per cent of the company’s revenue. This aligns with Spenda’s new core business model that focuses on ARR rather than project-based work.

Spenda also recorded a 500 per cent quarter-on-quarter increase in business-to-business (B2B) payment flows, with business-to-consumer merchant payment flows staying consistent over the last two quarters.

The company’s lending portfolio reportedly remained stable during the June quarter, with a balance of $12.1 million as of June 30. This marks a very slight increase from the $11.9 million at the end of March.

For the full 2022 financial year, however, Spenda’s lending portfolio experienced a 155 per cent increase since the acquisition of Invigo in July 2021.

Its current lending portfolio yields an average of 19 per cent quarter-on-quarter.

The company ended the quarter with $7.6 million in cash.

Meanwhile, Spenda said it expected further capital to be deployed now that it had established a debt warehouse facility.

In conjunction with today’s quarterly report, the IT stock announced it was entering into a $50 million debt facility agreement with an Australian private credit fund to provide capital to accelerate business growth.

The facility, which reportedly has more favourable funding terms than existing facilities, will enable the company to increase its net margins as well as write larger deals that fall within its credit policy guidelines.

“Scaling our lending facilities through our debt warehouse puts the company in a strong position to capitalise on forecasted trends in B2B payments,” SPX Managing Director Adrian Floate said.

“With digital adoption on the rise and growth in global trade, the demand for better payment infrastructure and faster access to working capital solutions will continue to accelerate.”

Spenda shares were down 17.65 per cent to 1.4 cents per share at 1:49 pm AEST