- iCar Asia (ICQ) has received a record cash receipt of $4.2 million for the fourth quarter of 2019
- This is a 39 per cent increase compared to the same period last year
- iCar also announced that the $2.29 million purchase of Carmudi Indonesia is now complete
- The company expects 2020 to deliver more than 50 per cent revenue growth
- In mid-afternoon trade, iCar’s share price is up an even 11 per cent with shares trading for 40.5 cents apiece
iCar Asia (ICQ) has received a record cash receipt of $4.2 million for the fourth quarter of 2019.
This is a $1.2 million, or 39 per cent, increase compared to the same period last year.
Growth was driven by strong cash collections in all business units including new and used car all three countries as the contribution from the one and a half months of Carmudi Indonesia’s operations.
Even excluding the impact of the Carmudi acquisition, iCar reached a record quarterly cash receipt result in Q4 2019.
This combined Indonesian business is expected to more than double iCar’s Indonesian revenues, increasing the overall contribution to the company’s revenues from 12 to 22 per cent.
The identified synergies are expected to result in the combined Indonesian businesses breaking even in 2020.
Strong cash receipts and lower expenditure led to a significant decrease in net operating cash flow by 25 per cent over Q4 2018 and 37 per cent on an annual basis versus 2018.
This is a result of iCar’s operations in Malaysia and Thailand now consistently being positive cash contributors and Indonesia having its net cash outflow and corporate costs remaining stable compared to 2018.
It also includes transaction costs associated with the Carmudi acquisition, initial impact of the Carmudi business operations before synergies are fully realised, and one-off expenditures in Q4.
The expected full realisation of revenue and cost synergies in Indonesia will require iCar to sustain a short investment period of a few months.
Following this period, iCar expects to return to EBITDA (earnings before interest, taxes, depreciation and amortisation) breakeven and profitability.
The company is expected to become cashflow positive in the second half of 2020 and be EBITDA positive in aggregate for the entire year.
iCar closed the year with $6.8 million in cash and cash equivalents after taking into account the $2.29 million purchase price of Carmudi.
The company also has access to additional funds in the form of a $5 million debt facility.
iCar expects to utilise only its existing cash and cash equivalents as it grows the business to cashflow breakeven and is not factoring in drawing down on the loan or accessing any other capital in its current expenditure plans.
Revenue in 2020 is currently expected to grow by more than 50 per cent on a year to year basis.
This will be achieved through iCar’s core business, as well as the contribution of the Carmudi business.
“The year of 2019 was a highly successful year for the group as we achieved run-rate EBITDA breakeven for the group in November 2019, one month ahead of our guidance,” CEO Hamish Stone commented.
“With the acquisition of Carmudi Indonesia now completed, we look forward to an even more successful year in 2020 where we will leverage on our leadership positions in all three countries to further grow our business portfolio into greater profitability,” he added.
In mid-afternoon trade iCar’s share price is up an even 11 per cent with shares trading for 40.5 cents apiece in a $154.9 million market cap.