The Laybuy Holdings Ltd (ASX: LBY) share price is up around 5% after making more progress in the UK.
Laybuy is one of the buy now, pay later businesses on the ASX. It’s operating in New Zealand, Australia, the UK and the USA. Consumers can buy now, and pay it off over sex weekly payments without paying interest.
Laybuy’s UK growth
The company announced that a merchant partnership agreement has been signed with the UK’s largest fragrance retailer, The Fragrance Shop. Customers can make purchases both online and in-store.
Laybuy pointed that The Fragrance Shop has 200 stores across the UK and offers 6,000 products.
Management said that agreements such as this are resulting in accelerated growth in the UK, where Laybuy is already recognised as one of the country’s top three BNPL providers.
The company said that its gross merchandise volume (GMV) has more than doubled in the UK, with annualised GMV close to NZ$398 million. Laybuy said this is being driven by strong merchant growth, with active merchants in the UK up 424% year on year.
The UK could be a key part of driving the Laybuy share price higher over time.
Management comments
Laybuy Managing Director Gary Rohloff said: “The UK is our growth engine. In the past quarter alone, we have added 743 new merchants in the UK as well as 53,800 new active customers to reach more than 500,000 active customers, an increase of 143% year on year.
“We remain a market leader in New Zealand and have a growing presence in Australia. Our active merchants in Australia and New Zealand increased 55% year on year, while active customers are up 20% in this more mature market.”
Management also noted that it has signed several larger merchants in the last few months including House of Travel, Adore Beauty Group Ltd (ASX: ABY), Sanity, Wittner, Ksubi, Max Fashions, Collette, Culture Kings, EB Games, Boardriders and Bailey Nelson.
Summary thoughts on Laybuy and the share price
The Laybuy share price has fallen by 56% over the last six months, despite the company’s continuing growth and the recent focus on the sector with the deal for Square to buy Afterpay Ltd (ASX: APT). It’s possible that it represents an opportunistic time to consider it.
There is rising competition in the space and I’m not sure if Laybuy represents a good buy at this lower price today. There are other ASX growth shares I’m focused on more.
