QuickFee Faces Credit Impairment and Leadership Change Risks Despite Solid Growth

Mixed Transaction Trends in Key Markets

QuickFee Limited (ASX – QFE) has delivered a nuanced performance in the fourth quarter of fiscal 2025 to date, with its US Pay Now and Australian Finance segments showing encouraging growth, while the US Finance arm faces headwinds. Total Transaction Value (TTV) for US Pay Now rose 9% year-on-year to US$352 million, reflecting steady demand for immediate payment solutions. Meanwhile, Australian Finance TTV increased 5% to A$10 million, supported by strong uptake of QuickFee’s 'Q Pay Plan' buy-now-pay-later product.

However, the US Finance segment experienced a 28% decline in TTV, primarily due to the termination of a key US firm’s loan originations following credit impairment issues. This setback has been compounded by broader market uncertainty linked to US trade tariffs and political factors, which have dampened lending activity.

Connect Platform Hits New Heights

QuickFee’s Connect platform, which integrates e-invoicing and automated collections, achieved a record volume of 47,000 invoices processed in April and May 2025 alone, surpassing the 37,000 invoices processed in the entire previous quarter. This surge is attributed to onboarding of contracted firms, increased adoption by existing clients, and seasonal invoicing spikes following the US tax season.

Strategic Refinancing and Capital Raise

In a significant financial move, QuickFee completed a A$118 million refinancing package with Viola Credit, replacing previous facilities from Northleaf Capital Partners and Wingate Corporate Investments. This three-year senior secured revolving credit facility provides enhanced liquidity and flexibility, with initial committed amounts of A$45 million and US$15 million, plus optional additional tranches.

Complementing this, QuickFee secured a A$5 million term loan from Fancourt Capital Group to support further loan book growth. The company also successfully raised A$1.25 million through a share placement and an additional A$0.25 million via a Share Purchase Plan, demonstrating strong investor confidence despite recent challenges.

Credit Impairment and Legal Action

QuickFee has recognised a one-off provision expense of US$2.2 million (A$3.3 million) related to unpaid loan instalments from a US firm that defaulted on repayments. The company is pursuing legal proceedings in the US to recover these amounts and is exploring insurance claims. While the ultimate recoverability remains uncertain, QuickFee’s maximum exposure is capped at this provision.

Leadership and Strategic Review

Following the resignation of US President Jennifer Warawa, QuickFee’s Chief Operating Officer James Drummond is acting as interim US President while the company conducts a comprehensive leadership review. Additionally, QuickFee has received unsolicited acquisition inquiries for its US business, with preliminary confidential discussions underway. No decisions or assurances have been made regarding any potential sale.

Outlook and Earnings Guidance

Despite the credit impairment and US Finance challenges, QuickFee reported positive underlying earnings before tax, depreciation, and amortisation (EBTDA) for April and May 2025. The company maintains its FY25 underlying EBTDA guidance of A$1.5 million to A$2.5 million, excluding the one-off credit provision. Statutory EBTDA guidance remains in the range of -A$0.8 million to -A$1.8 million, reflecting the ongoing impact of the impairment.