Tradies booking group Hipages turns new leaf with ASX listing

Tradies booking group Hipages turns new leaf with ASX listing

News Limited-backed tradies booking service hipages (ASX: HPG) got to work on the ASX today.

The company, which links home owners and tradies via an app, launched at $2.45 a share for an implied market capitalisation of $318.5 million.

More than $100 million was raised through the IPO, arriving amidst a slew of upcoming listings, with retailer Booktopia (BKG), shopping rewards group Cashrewards (CRW), e-learning operation Cluey (CLU), online lender Harmoney Corp (HMY) and prepared meals delivery service Youfoodz (YFZ) all lined up for floats in the coming weeks.

CEO Roby Sharon-Zipser, who co-founded the company in 2004 after renovating a unit with his wife, said hipages had a strong start to the new financial year as consumer behaviours continued the shift to online and the current environment drove demand for home improvement services.

"With 1.4 million jobs posted to our platform in FY2020, hipages is the leading online platform connecting consumers and tradies in Australia," he said.

"Our listing today on the ASX represents an important milestone for hipages and its shareholders as it will enable us to entrench our sector leadership and drive further innovation that benefits both tradies and their customers."

The former accountant said the group had made a strong start towards its FY21 revenue target of $53.9 million with first quarter total revenue of $13 million, up 15 per cent year-on-year. 

He said October revenue growth had continued at similar levels.

"As we continue our transition to a subscription-only model, we are also benefiting from strong momentum in job numbers as both tradies and consumers recognise the merits of our unique value proposition," he said.

In its prospectus the group forecast a $9.2 million loss in FY21, which is deeper into the red than the $5.9 million negative figure in FY20. At the time of writing, HPG shares were down slightly at $2.42 each.

News Corp Australia is the largest shareholder in the company with a 25.7 per cent interest, while Sharon-Zipser's RSZ Pty Ltd holds close to a 5.8 per cent stake.

About $40 million in gross proceeds was raised through the issue of new shares by the company, with the balance coming via a secondary offer of shares by existing Hipages shareholders.

Those proceeds will be used to invest in Hipages' brand and technology platform, along with expansion into new channels and adjacent opportunities.

"Today marks an important step in our evolution with hipages well positioned to take advantage of powerful digital and community trends that will drive increased demand for our innovative solutions," says chair Chris Knoblanche.

"We believe hipages has a significant role to play in improving the engagement of Australians with a wide range of trade services.

"My fellow directors and I are delighted to welcome our new shareholders to the register and thank existing shareholders for their ongoing support, as we embark on the next phase of our journey."

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