Hi Ian, it's in the Trading Update RNS 29/01/24 - although re-reading it belongs in the EBITDA column so I'll update the article and post the reference
I'm not an accountant but I think you have misinterpreted this (not sure CHRY have made it clear either). They are in no way on track to make $800m of profit, those numbers seem to be saying they will be $800 million better than lasts years huge losses.
Looking at Q32023 they had revenue of 6bn SEK (5.5bn Q2), credit losses of 0.8Bn (1bn Q2), profit of 0.1bn (Q2 I think -.9bn). They also use adjusted operating result of 0.5Bn which I think is EBITDA so excludes loads of costs (they are one of these companies that prefers alternative performance measures as they have huge expenses by the looks of it). Using the current exchange rate that means they made about £7.5M of actual profit in Q3 so if it’s valued at £1.31bn then I think its P/E is a bit more than 2.
Its return on equity is a negative number. As they are basically just a consumer facing lender am I right in thinking negative isn’t ideal?
The $800m came from CHRY's RNS 29/01/24 where (I quote)
"This implies that Klarna's quarterly operating performance has improved by approximately SEK2.1 billion year-on-year, or roughly USD200 million, or approximately USD800 million on an annualised basis."
So improvement not outcome - so I've misread that and so have updated the chart - thanks for spotting that.
Hi,
Where did you get the Klarna $800 million figure from? All I could find is that they made about £9.6 million in Q3 last year (130M SEK). Ian
Hi Ian, it's in the Trading Update RNS 29/01/24 - although re-reading it belongs in the EBITDA column so I'll update the article and post the reference
I'm not an accountant but I think you have misinterpreted this (not sure CHRY have made it clear either). They are in no way on track to make $800m of profit, those numbers seem to be saying they will be $800 million better than lasts years huge losses.
Looking at Q32023 they had revenue of 6bn SEK (5.5bn Q2), credit losses of 0.8Bn (1bn Q2), profit of 0.1bn (Q2 I think -.9bn). They also use adjusted operating result of 0.5Bn which I think is EBITDA so excludes loads of costs (they are one of these companies that prefers alternative performance measures as they have huge expenses by the looks of it). Using the current exchange rate that means they made about £7.5M of actual profit in Q3 so if it’s valued at £1.31bn then I think its P/E is a bit more than 2.
Its return on equity is a negative number. As they are basically just a consumer facing lender am I right in thinking negative isn’t ideal?
This is where I got the info from: https://assets.ctfassets.net/4pxjo1vaz7xk/4RHQluYoE65tXKxI6dQp48/9e5f0a37cdf520341093f744adbdd7f6/Klarna_Q3_2023_Financial_Update.pdf
Obviously none of it matters if the IPO at a decent amount and people don’t look at the numbers to much as they are a ‘startup’!
Hi again Ian,
The $800m came from CHRY's RNS 29/01/24 where (I quote)
"This implies that Klarna's quarterly operating performance has improved by approximately SEK2.1 billion year-on-year, or roughly USD200 million, or approximately USD800 million on an annualised basis."
So improvement not outcome - so I've misread that and so have updated the chart - thanks for spotting that.