The Zebit Inc (ASX: ZBT) share price has gone up by more than 12% after the company gave a sales update.
Zebit is a California-based e-commerce company which says it wants to help credit-challenged consumers by giving them access to a set of products, and the ability to pay for those products in instalments over six months with no late fees or interest charges.
Sales update
Zebit announced today that its FY20 fourth net sales were US$44.8 million, which was an increase of 35.2% (or US$11.6 million in dollar terms). In December, net sales were US$21.3 million, which was an increase of 55.4% compared to December 2019.
When adding the fourth quarter net sales to the other three quarters that had already been completed, Zebit was able to report that its total net sales were US$88.1 million, which was higher than FY19.
In the fourth quarter of FY20, Zebit said it executed eight new business to business acquisition partnerships that accounted for 28,800 registered user in the fourth quarter of FY20. Cumulative registered users at the end of the year increased to 792,000. Zebit said it continues to see strong opportunities for customer growth.
Zebit said it performed well extremely through the peak shopping season. Further details will be shared in the FY20 fourth quarter trading update at the end of January. Key performance indicator comparisons to the prospectus will be included in the full year results after that.
Management comments
Zebit CEO and President Marc Schneider said: “The strength of Zebit’s performance through Q4 is a bellwether for the increasing demographic of consumers who value and repeatedly use the company’s eCommerce services. We expect strong growth in 2021 as we expand our reach in helping the increasing number of Americans living paycheck to paycheck purchase everyday products that many of us take for granted. In addition to its primary eCommerce sales channel, as physical stores reopen, Zebit will also enable consumers to continue to finance purchases in physical retailers through sales of electronic gift certificates on our platform that can be redeemed in brick and mortar.”
Summary
Zebit is reporting good growth, but I’m generally quite cautious about investing in businesses that have only been on the ASX for a short while. But Zebit could be one to watch if that growth rate continues. There are other ASX growth shares in the payments sector that I do like today such as Pushpay Holdings Ltd (ASX: PPH) and EML Payments Ltd (ASX: EML).
