Prospa Group Ltd (ASX: PGL) shares cratered 28% this morning after the small business lender warned that its expected calendar year 2019 revenue of $143.8 million would be $12.6 million lower than its IPO prospectus forecast. Originations or loans made over calendar year 2019 of $574.5 million are actually forecast to come in slightly above IPO forecasts.
According to the company the discrepancy between higher loan volumes but lower revenues is because the loans are being made to better credit quality clients at lower interest rates over longer terms.
It also downgraded calendar 2019's EBITDA (operating income) expectations to around $4 million, compared to an IPO prospectus or pro forma forecast for $10.6 million.
Prospa hit the ASX boards in June 2018 after issuing 161.35 million shares at an offer price of $3.78, with the stock having now lost around a third of its value on the back of a disappointing start to life as a public business.
