The Airtasker Ltd (ASX: ART) share price could be an opportunity after the business announced its FY22 report.
Airtasker runs a platform for households and businesses to advertise that they have a job or task that needs doing. Those people can then link up with individuals or businesses who can offer to do that work.
How did Airtasker perform in FY22?
The performance of the Airtasker share price and the numbers reported in its result can show very different things. Airtasker shares have been dropping, but the business keeps growing. Earlier in August, the ASX tech share reported:
- Total gross marketplace volume (GMV) increased 23.8% to $189.6 million
- Revenue went up by 18.4% to $31.5 million
- UK GMV went up 114.7%
- US posted task growth rose 49% quarter on quarter in the fourth quarter
- Positive operating EBITDA (EBITDA explained) of $1.3 million
Firstly, let’s have a quick look at what the EBITDA figure was.
Newly listed, rapidly growing tech shares like to get to positive EBITDA because it shows that they are profitable on a day to day basis. In accounting terms, Airtasker isn’t quite there yet. It said that its Australian marketplace plus head operations EBITDA was $1.3 million. Importantly, this profit measure excludes the research and development expense of $7.8 million as well as the $10.6 million loss of the US and UK marketplaces at the EBITDA level.
Airtasker’s actual EBITDA was a loss of $17.1 million.
But, it shows that it’s already profitable with its Australian operations. As the international marketplaces grow, I expect they will quickly reach positive EBITDA as well.
Keep in mind that the Australian marketplace saw $31 million of revenue and a gross margin of $28.9 million. A gross profit margin of 93% is very attractive for future profitability when Airtasker is investing less for growth on things like marketing and product development.
Well-positioned to benefit from inflation
Airtasker thinks it can keep doing well, even under difficult economic conditions.
It said that flexible labour represents a “lower cost alternative” compared to traditional labour sources. Also, around 70% of Airtasker’s jobs are described as essential, and non-discretionary, in nature.
Airtasker also thinks the current environment could mean there’s an increased availability of workers to do jobs, higher household costs could mean there are more incentives to seek more income and higher immigration (and lower COVID “absenteeism”) will mean more worker availability.
I also think that inflation could mean that the value of the tasks posted on the platform could organically increase, leading to bigger revenue for Airtasker (assuming the same revenue margin on GMV).
Final thoughts on the Airtasker share price
Airtasker is a very interesting business in my opinion. While it’s not building a client base generating recurring revenue, such as a business like Xero Limited (ASX: XRO), I think the scale and gross profit margin of Airtasker show great promise for the long-term as it scales in Australia, the US and UK.
Presumably, other markets could be targeted in the long-term, like Canada, New Zealand, South Africa and so on.
At the current Airtasker share price of $0.42, I think it has plenty of positive potential. I’d be very happy to buy shares.
