The Airtasker Ltd (ASX: ART) share price is down despite the company reporting its FY22 half-year result with a guidance upgrade.
Airtasker links people who want to work with people who need work doing, via a platform.
Airtasker’s solid start to FY22
In the first six months of FY22, Airtasker reported:
- Gross marketplace volume (GMV) growth of 15.5% to $83.6 million
- Revenue growth of 10.4% to $13.9 million
- Average task price increased 24% to $255
- Gross profit rose by 9.5% to $12.9 million
- Second quarter GMV jumped 39% quarter on quarter
- Record weekly GMV run rate of $4.5 million in December 2021
- Negative underlying ‘pro forma’ EBITDA of negative $3.2 million
Lockdowns impacted the first quarter of FY22, with Victoria and NSW heavily impacted. But there was a strong recovery in the second quarter.
During the half, a number of measures were put in place to support the community of taskers (including restoring tier status during lockdown) which resulted in a lower take rate during the period.
The EBITDA went negative reflecting an expected increase in investment in product development, marketing and expansion in the UK and US.
International growth
The UK and US addressable markets are much bigger than Australia, so growing in these two countries could be very beneficial for the Airtasker share price.
Airtasker said it’s trying to achieve task growth in the US. In the second quarter, Airtasker’s US marketplace saw posted task growth of 71% quarter on quarter. It’s focused on four key cities in the US – Atlanta, Kansas City, Dallas and Miami. But it’s also seeing growth in non-core cities.
Turning to the UK, Airtasker’s second-quarter GMV was up 121% year on year.
The company continues to grow its marketing team to expand the business. Its global marketing headcount has doubled from 10 to 20. It’s rolling out a marketing campaign called “The Joy of Done” which will be rolled out across Australia and the UK.
Outlook
The business upgraded its second half guidance, from $105 million, to a range of $107 million to $110 million. This is because of the strength of the growth trajectory and the clear outlook on no further lockdowns.
Airtasker is an interesting business to me. Whilst the Airtasker share price may partly be dropping because of interest rate worries, I think the business can benefit from inflation because of an increasing average task value.
The business has huge aspirations. The gross profit margin is very high and this allows the business to re-invest heavily for growth.
At a share price of $0.72, I wouldn’t be surprised to see the business do well over the next five years. It’s one of the ASX growth shares on my watchlist.