Buy now pay later company Openpay has rolled over two of its three debt facilities, but its future remains uncertain with its biggest facility still under review.
The company announced yesterday that a A$10 million working capital facility maturing next month has been extended to October next year, with the facility increased by $2.5 million.
And a $30 million corporate debt facility maturing next month has been extended until July next year.
When the company released its 2021/22 financial report last month, it said a third facility – a $65 million receivables funding facility – was under review. There was no news on that yesterday.
Openpay lost a lot of money last financial year and is relying on the continuation of its debt arrangements to stay afloat. It reported a loss for $82.4 million for the year to June, following a loss of $63.1 million in 2020/21.
Revenue grew from $26.3 million in 2020/21 to $34.2 million in the year to June but the employee benefit expense alone was $44.1 million, other operating expenses were $33.3 million, finance costs were $17.7 million and the receivables impairment expense was $9.4 million.
Net cash used in operating activities was $81.2 million. Cash and cash equivalents on the balance sheet fell from $52.1 million in 2020/21 to $10.3 million at June 30. The company has a net liability of $14.9 million, making it technically, or balance sheet, insolvent.
The 2021/22 financial report, which was not audited, said: “There is a material uncertainty that may cast significant doubt on the group’s ability to continue as a going concern and, therefore, that it may be unable to realise its assets and discharge its liabilities in the normal course of business.
“The directors believe that the funds available from existing cash reserves and debt facilities, combined with sourcing new funds through (but not limited to) securing additional debt facilities and/or the issue of new shares, would provide the group with sufficient working capital to carry out its stated objectives for at least the next 12-month period.”