Hipages Group Holdings Ltd (ASX:HPG) Shares Surge Following Strong FY24 Results

2 min read | August 22, 2024 06:26 PM AEST | By Team Kalkine Media

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Hipages Group Holdings Ltd (ASX:HPG) Shares Surge Following Strong FY24 Results — Image source: Natee Photo, Shutterstock.com

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Hipages Group Holdings Ltd (ASX:HPG), the online marketplace for tradespeople, has seen its shares rocket today, reflecting a strong investor response to its FY24 financial results. After closing at AU$1.28 per share yesterday, Hipages shares surged to AU$1.62 in early trading on Thursday, marking a remarkable 26.8% increase.

Hipages’ strong performance for the fiscal year ended 30 June 2024 has clearly captured the market's attention. Here are the key financial highlights:

The company reported total revenue of AU$75.8 million, marking a 13% increase from FY 2023. This growth underscores the company's continued expansion and resilience in a competitive market.

Recurring revenue for FY24 reached AU$72.1 million, up 15% year-on-year. This growth reflects robust demand for the platform’s services and effective retention strategies.

Underlying EBITDA surged by 33% to AU$16.4 million, demonstrating significant improvement in operational efficiency and profitability.

Hipages achieved a statutory net profit after tax of AU$3.6 million, a notable turnaround from the previous year's net loss of AU$5.1 million. This return to profitability highlights the company's successful strategic initiatives over the past year.

In addition to financial improvements, Hipages reported record marketplace activity for FY24. The platform saw a 15% increase in recurring revenue, driven by increased competition among tradespeople for fewer job opportunities. This competitive environment contributed to a 13% rise in monthly recurring revenue (MRR) and an 11% increase in average annual revenue per unit (ARPU).

EBITDA margins improved to 22%, up 4% from FY 2023, reflecting efficient cost management despite a 9% increase in operating expenses to AU$59.4 million. Operating cash flow rose by 23% to AU$19.3 million, resulting in positive free cash flow of AU$2.1 million, a significant turnaround from the AU$2.8 million cash outflow reported in FY 2023.

The number of connections on the platform increased by 3% to 2.7 million, with a record 86% of all jobs connected to a tradie. The company also introduced several new platform features and functionalities over the year.

As of 30 June, Hipages held AU$21.3 million in cash and funds on deposit, with no debt, positioning the company well for future growth and investment opportunities.

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