The Airtasker Ltd (ASX: ART) share price is in a trading halt as it carries out a capital raising to fund global growth.
Airtasker hitting targets
The company said that since listing two months ago, its core marketplace metrics are tracking at or ahead of forecasts. Costs remain at or below plan.
Its prospectus guidance was 405,000 unique paying customers – it had 333,000 in the year to date to March 2021. It guided an average annual purchase frequency of 1.9x, Airtasker said it’s on track for this. The average task price in the prospectus was $189, in the year to date to March 2021 it was $194.
Airtasker has also increased its FY21 gross merchandise volume (GMV) forecast from $143.7 million, up to a range of $148 million to $152 million. The revenue prospectus forecast was $24.5 million, which was upgraded to a range of $25.5 million to $26 million.
The company also said that its gross margin is ahead of forecast.
Management believe there are huge opportunities within existing industries like home services (cleaning, handyman) and business services (office admin, accounting). But it can also provide services in a wide array of other ‘industries’ like flatpack furniture assembly.
International growth
Organic growth in city markets in the UK and US is tracking ahead of expectations. It hasn’t needed to spend much on marketing to achieve the growth. There has been good growth during 2021 in both markets.
Airtasker also announced the $3.4 million acquisition of Zaarly. The plan is that this will accelerate growth in the US. Zaarly has a re-booking functionality that will be integrated into the Airtasker global platform to enable repeat customer transactions. Zaarly has a presence in Dallas and Kansas City – in FY22 it has a goal of launching four or five additional US city-level markets.
Over FY22 and FY23, the company plans to invest $20 million into the US and UK to identify scalable growth tactics while maintaining a sustainable cash burn rate.
Capital raising
Airtasker plans to raise $20.7 million at $1 per new share from institutional and sophisticated investors. That price represents a 7.4% discount to the last closing price.
Summary thoughts on the Airtasker share price
The Airtasker share price has calmed down. The US and UK are huge potential markets and could be opportunities if Airtasker can continue to earn high gross profit margins and grow quickly there without too much marketing spending.
It could be a very good long term ASX share if it can keep growing the volumes and maintain the margins. But it’s hard to value ASX growth shares like this when the potential outcomes are so varied.
