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A decision last year from online services marketplace Airtasker (ASX: ART) to cut 45 jobs has contributed to a turnaround in earnings, reducing its employee benefits expense by $5.6 million in the December half while a greater portion of expenditure went towards sales and marketing.
Sydney-based Airtasker reported marginal growth of 6.8 per cent in revenue to reach $23.3 million, but earnings were flipped from a $5.1 million loss in the equivalent period to a group EBITDA of $1.7 million.
The performance improvement was even more pronounced for its Australian operations, going from an EBITDA loss of $2 million to a positive result of more than $7 million.
It is a result that pushed the company tantalisingly close to breakeven in statutory terms with a net loss of $291,000, predominantly due to losses for its growth markets of the US and UK.
Airtasker reports its earnings result was largely driven by top line revenue growth of $1.5 million and the "benefits flowing from the one-time operational restructure implemented in April 2023 that resulted in a 20 per cent headcount reduction".
"I’m super pleased to announce that Airtasker has delivered positive free cash flow ahead of plan and is on track for a full year free cash flow result in FY24," says Airtasker founder and CEO Tim Fung.
"It’s been an incredible achievement by the whole Airtasker team to drive solid revenue growth whilst at the same time delivering massive improvements in operating efficiency.
"Our unwavering focus on the core Airtasker product experience has seen a dramatic improvement in marketplace reliability, fewer cancellations and less leakage. With this much more efficient sales funnel, we’re super excited about the potential as market conditions continue to improve."
He says it has also been "super awesome" to see the partnership with Channel 4 in the UK come to fruition with the launch of its ‘Airtasker. Yeahtasker!’ television brand campaign.
"This brand campaign has already delivered over 30 per cent growth in posted tasks and we can’t wait to see this marketplace grow as the UK heads into the peak spring and summer seasons. We’ve got a massive 2024 ahead," Fung adds.
This UK initiative mimics Airtasker's media-for-equity partnership with Seven West Media (ASX: SWM) here in Australia, which the company claims has resulted in revenue growth of 20x and a 5x investment return for Seven West Media over five years.
During the period Airtasker's sales and marketing expenditure rose 48.6 per cent to $5.5 million, of which $1.1 million was attributed to the ‘Airtasker. Yeahtasker!’ campaign including creative assets, paid marketing and amortisation of the advertising media services asset provided by Channel 4.
This led sales and marketing to comprise 23.6 per cent of total expenditure for the company, compared to 17.1 per cent in the first half of FY23.
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