Payment solution provider Zip Co’s stock rebounds, closing at its 52-weeks high today, after the company joined hands with Australia’s largest pharmacy retailer for the delivery of interest-free payments solutions. The stock closed the day’s trading session at $1.270, up by 6.723% 12 February 2019.
In the media release to ASX, Zip Co Limited (ASX: Z1P) announced that it has partnered with Chemist Warehouse Retail Services Pty Ltd to offer Zip interest-free payments to its customers. That means now Australians can make interest-free payments through using Zip account gateway when shopping online and in-store across Chemist Warehouse, My Beauty Spot, My Chemist, & ePharmacy.
CEO and Managing Director of Zip, Larry Diamond stated that this partnership enables Zip customers to pay for every day spend across Chemist Warehouse platform through Zip’s interest-free digital wallets providing better payment terms and experience.
Zip expects to go live throughout the Chemist Warehouse’s Australian store network within the next few months. This deal aligns with the company’s strategic vision of collaborating with Australia’s largest retailers for building a stronger customer base.
Further, in the last week of January 2019, ZIP Co unleashed the record-breaking quarterly results with over 1 million customers. The company posted record revenue of $19.2 million, up 28% on the previous quarter, for the quarter ended 31 December 2018. This translates the tremendous growth on customer numbers’ front that has gone up by 20% to 170k in the quarter.
Zip finished the second quarter of Fiscal 2019 with its biggest promotional campaigns to then, with Zip Frenzy, Black Friday, Cyber Monday and Boxing Day all recording more than twice the volumes achieved in the previous year.
It has also recorded 84% improvement in cash operating result of $4.6 million in Q2 FY19 compared to Q1 FY19. Moreover, the company confirmed that its operating leverage continues to enhance with scale – costs continue to reduce as a percentage of average receivables, dropping from 17.2% in Q1 to 16.1% in Q2.
The transaction volume for November and December both exceeded $100 million, taking total transaction volume for the quarter to $304.4 million, representing a growth of 60% compared to Q1 FY19 and 117% compared to the previous corresponding period.
Going forward, the company intends to replace its current warehouse facilities to achieve greater scale at a lower cost. It is expected to announce the debt structure by the fourth quarter of Fiscal 2019. As at 31st December 2018, Zip had total facilities available of $531 million. However, subsequent to the quarter end, the Company finalised the documentation to increase the NAB facility by a further $100m, taking total facilities to $631 million.
Zip has posted as massive as 618.48% returns on stock exchange over the last five years. Moreover, the stock has witnessed a positive price change of 9.17% over the past 12 months.
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