Katapult Holdings (KPLT) Registration filing summary

Company overview and business model

• Digital, e-commerce POS lease-purchase platform serves U.S. nonprime consumers seeking durable goods; merchant integrations, automated underwriting and flexible payment choices underpin the model.

• Applications receive decisions in five seconds or less on average; the platform reported over 150 merchants and a 48% repeat customer rate at Dec. 31, 2020.

• Customers can buy out, continue lease payments or return goods; the business reports no late fees and uses a proprietary risk model drawing on 500,000+ transactions and five years of repayment data.

Financial performance and metrics

• FY2020 revenue $247.2M vs. $91.9M in FY2019; net income $22.5M vs. net losses of $18.8M in FY2019 and $23.5M in FY2018.

• H1 2021 revenue $158.1M, up from $103.6M YoY; gross profit $49.3M vs. $34.0M, while net loss was $13K vs. net income of $8.8M.

• Q2 2021 revenue rose 27.6% YoY to $77.5M, while gross profit increased 16.7% to $21.5M and net loss was $8.1M vs. net income of $5.1M.

• June 30, 2021 cash $109.8M, revolving credit balance $72.4M and term debt $50.9M; H1 operating cash flow was $7.1M vs. $13.1M used in H1 2020.

• H1 2021 gross originations fell 17.0% YoY in Q2 to $64.4M; Wayfair accounted for 62% of Q2 originations and 72% of FY2020 origination dollars.

Use of proceeds and capital allocation

• No proceeds from securityholder resales; cash exercise of all warrants could generate up to $3.8M, intended for general corporate purposes, potentially including temporary or permanent debt repayment.

• Management retains broad discretion over warrant proceeds; warrant holders may choose not to exercise, so proceeds are conditional.

• Merger and PIPE closed June 9, 2021; the PIPE issued 15.0M shares for $150M, and merger financing included $329.6M cash consideration to pre-merger holders.