Profit taking, page-49

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chris1983

13,667 Posts.

1290

06/04/19

00:44

Post #: 38022038

Originally posted by upside_down: ↑

Assuming 4:1 debt:equity ratio & their current 12x/year lending rate, and not taking into consideration current equity levels,

Let's look at scenarios of different capital raisings:
Capital raised Possible debt leverage (capital x 4) Total Afterpay funding available GMV funding ability ( x 12)
1 $200 million $800 million $1 billion $12 billion
2 $400 million $1.6 billion $2 billion $24 billion
3 $500 million $2 billion $2.5 billion $30 billion
4 $1 billion $4 billion $5 billion $60 billion
5 $2 billion $8 billion $10 billion $120 billion
6 $3 billion $12 billion $15 billion $180 billion
7 $4 billion $16 billion $20 billion $240 billion

Based on the above you can see they won't need more than ~$400 million equity to fund $20 billion GMV. And looking at their equity position they have $340 million balance sheet equity, or $230 million if you take out non-current assets & intangibles. With that $230 mil they can already borrow $920 million on top without raising capital, and fund $14 billion in annualised sales. And that's exactly what they're doing, they have $520 million in A&NZ facilities and are getting another $420 million US facility. This will give them > $10 billion annualised sales funding capacity. They could do another raise of $200 million right now if they wanted to to cover themselves for $20 billion GMV and dilution would be ~3-4%.
Expand
so we won’t be diluted 50%?

thank goodness. I was worried when I read that part.

APT Price at posting: $24.40 Sentiment: Buy Disclosure: Held

1 Upvote

0 Great analysis

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	Capital raised	Possible debt leverage (capital x 4)	Total Afterpay funding available	GMV funding ability ( x 12)
1	$200 million	$800 million	$1 billion	$12 billion
2	$400 million	$1.6 billion	$2 billion	$24 billion
3	$500 million	$2 billion	$2.5 billion	$30 billion
4	$1 billion	$4 billion	$5 billion	$60 billion
5	$2 billion	$8 billion	$10 billion	$120 billion
6	$3 billion	$12 billion	$15 billion	$180 billion
7	$4 billion	$16 billion	$20 billion	$240 billion

Profit taking, page-49

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