Airtasker Reports Positive Cash Flow and New Media Partnerships for FY24
ART (ART) Share Update July 2024 Monday 29th
Airtasker Reports Strong Financial Performance and New Media Partnerships
Airtasker Limited (ASX: ART) has delivered strong financial results for FY24, reporting positive free cash flow and notable revenue growth, alongside new media partnerships to drive future growth.
Instant Summary:
- FY24 positive free cash flow of $1.2 million, an improvement of $8.8 million (115.3%) on prior comparative period (pcp).
- Airtasker platform fee revenue up 13.9% on pcp.
- UK 4Q24 revenue up 76.3% on pcp.
- $17.8 million in cash and term deposits on balance sheet.
- $11.0 million in advertising from oOh!media and ARN to accelerate Australian revenue growth in FY25.
Financial Performance
Airtasker has reported a positive free cash flow of $1.2 million for FY24, marking an improvement of $8.8 million (115.3%) compared to the prior comparative period (pcp). The company also achieved a positive operating cash flow of $3.1 million, up $13.9 million (128.1%) on pcp.
This strong cash flow result was driven by solid group revenue of $46.6 million, up 5.6% on pcp, and significant operating efficiencies, including a 31.8% reduction in headcount costs and a 31.9% reduction in administration and corporate costs.
Revenue Growth
Airtasker's platform fee revenue increased by 13.9% on pcp to $34.1 million, thanks to a successful investment program in platform reliability, which saw cancellations reduce by 26.3% on pcp. This led to an all-time record in completed task volumes.
In the UK, Airtasker's revenue for 4Q24 grew by 76.3% on pcp, driven by the success of the 'Airtasker. Yeah tasker!' advertising campaign launched in partnership with Channel 4. This campaign significantly boosted brand awareness and marketplace demand.
New Media Partnerships
To further accelerate growth, Airtasker has announced new media partnerships in Australia with oOh!media Limited and ARN Media Limited. These partnerships, worth $11.0 million in total, will provide Airtasker with extensive out-of-home and audio advertising services over the next two years.
The terms of the partnerships involve issuing each partner with $5.0 million unsecured convertible notes with a 5.8% annual coupon payable at maturity. These notes are convertible into ordinary shares at a 10% discount to Airtasker's 30-trading day volume-weighted average share price or redeemable in cash at Airtasker's option.
CEO's Comments
Tim Fung, Airtasker's Founder and CEO, expressed his satisfaction with the company's performance, stating, 'I'm super pleased to announce that Airtasker has delivered on our promise of positive full-year free cash flow of $1.2 million. During FY24, we focused on platform reliability, which saw cancellations decrease by 26.3% and Airtasker platform fee revenue grow by 13.9%. This now lays the foundation for the re-acceleration of Australian revenue growth in FY25, with the support of our recently announced media advertising partnerships with oOh!media and ARN.'
The positive financial results and strategic media partnerships are likely to boost investor confidence in Airtasker. The significant improvement in cash flow and revenue growth, particularly in the UK market, indicates strong operational performance. The new media partnerships will provide substantial advertising support, potentially driving further revenue growth in FY25.
Investor Reaction:
Analysts are expected to react positively to Airtasker's financial performance and strategic initiatives. The substantial revenue growth and improved cash flow, along with the new media partnerships, are likely to be seen as strong indicators of the company's growth potential.
Conclusion:
Investors should keep an eye on Airtasker's continued performance and the impact of the new media partnerships on revenue growth in FY25. The company's strategic focus on improving platform reliability and expanding brand awareness through advertising partnerships positions it well for future growth.