- Zip Co (ASX:ZIP) shares are up 10 per cent on its 2Q24 report
- The company took out a $150 million debt facility in the quarter
- Zip’s balance sheet continues to improve with available cash and liquidity increasing nearly $30 million since Q1FY23
- The US market is driving Zip across the line as management points to “particularly strong seasonal performance”
- Shares last traded at 70 cents
Zip Co (ASX:ZIP) has released its Q2 FY24 results, flagging also the entire company ended the quarter EBTDA cash positive based on strong US tailwinds.
Forecasting also its 1H FY24 guidance, group cash is expected to be up to $33 million in 1H24 – compared to negative $33 million in 1H FY23.
The market liked the news, with Zip shares up 10.24 per cent to 70 cents in the first hour of trade.
All metrics up
On all fronts, Zip appears to be the beneficiary of a world slowly exiting the COVID years. All metrics are up year on year (YoY).
Transaction volumes hit $2.8 billion in Q2FY24, up 8.5 per cent YoY.
Quarterly revenue grew 26 per cent YoY to $225.6 million; revenue margins jumped from 7.1 per cent in Q2FY23 to 8.2 per cent in Q2FY24.
Zip recorded 20.6 million transactions across the quarter, up 4.1 per cent YoY, and cash transaction margins increased to 3.5 per cent from 2.8 per cent the year prior.
Household names on-board
The company’s success this quarter is largely steeped in the American market where revenue was up 34 per cent YoY due to record transaction volumes.
Bad debts with the company continue to remain below the 1.5 per cent target (by one pip) and Australian bad debts are now down to 3.64 per cent of overall owing.
RM Williams, event logistics provider Moshtix and National Geographic were among companies that integrated Zip payments tech into their operations through the quarter.
ZIP shares last traded at 70 cents.