Laybuy shares go into trading halt

Gary Rohloff, managing director of Laybuy. Photo / Jason Oxenham

Kiwi buy now pay later operator Laybuy Group Holdings has gone into a trading halt at the request of the company as it looks to de-list from the Australian stock exchange.

The firm, which has its head office on Auckland’s North Shore, listed on the ASX in September 2020 with an initial public offer price of A$1.41.

But its shares have fallen sharply and are worth just A6 cents.

In an announcement this morning the company said it would be placed into a halt pending it releasing an announcement in relation to an application to be removed from the official list of ASX.

“Unless ASX decides otherwise, the securities will remain in trading halt until the earlier of the commencement of normal trading on Wednesday, 25 January 2023 or when the announcement is released to the market.”

The company undertook a restructure last year, shedding a third of its workforce and cutting costs in a bid to get to profitability.

In its last update to the market on November 29 the company said it was on track to achieve earnings before interest, tax, depreciation and amortisation (EBITDA) profitability in March 2023.

Its EBITDA in the half year ended September 30, 2022 was -$13.9 million - a 35.2 per cent improvement on the same period in the prior year while its tax loss narrowed by 34 per cent to -$14.9m.

At the time managing director Gary Rohloff said the first half of its financial year had seen the company make strong progress on its pathway to profitability.

“We achieved these results through a resolute focus on implementing our strategy, which sees us reducing costs across the business while at the same time improving the quality of our customer base and reducing fraudulent activity on our platform.”

Its default rate had fallen to 2 per cent - a drop of 60 basis points year on year.

Rohloff founded the business in 2017 after a conversation with family about a safe and easy alternative to credit cards to buy a pair of jeans. At the time of its listing it was valued at A$246m.

But with buy now pay later businesses falling out of favour with investors its market capitalisation is now just A$15.45m.