The company’s release of its AGM has had a negative effect on its share price today…
The post iCar Asia (ASX:ICQ) share price tumbles 6% on AGM Presentation appeared first on The Motley Fool Australia. –
At the time of writing, the car listings company’s shares are down 6.15% to 30.5 cents.
Key highlights in the AGM presentation
In its announcement, iCar Asia highlighted the growing market of the Association of Southeast Asian Nations (ASEAN).
According to the ASEAN Automotive Freedom 2020 Statistics, ASEAN is the fifth largest car transaction market in the world. This is followed by China, the United States, Japan, and Germany.
Pleasingly, iCar Asia’s market comprises the three biggest ASEAN countries, namely Thailand, Indonesia, Malaysia. The trio alone represents 73% of the company’s entire transactions in its operating markets. Furthermore, iCar Asia is considered the number one network of automotive shopping portals across the South East Asian nations.
Group average monthly revenue increased up by 37% from January to April 2021 when compared against the prior corresponding period. This resulted in achieving revenue of $5.8 million. The improved performance was attributed to the car trading business in Malaysia, predominately its used car segment.
While sales jumped in the double digits, management focused on keeping costs down with operating expenses at $7 million. iCar Asia noted that costs are still higher than revenue due to the lingering impact of COVID-19, particularly affecting Indonesia. Expenses rose 9% over the first 4 months of 2021 against the prior comparable time frame.
A possible catalyst for iCar Asia shares falling today is its earnings before interest, tax, depreciation and amortisation (EBITDA) metric. EBITDA sank 34% to a loss of 2.7 million against FY20’s January to April period which saw a loss of $1.8 million. The EBITDA margin also plummeted to 65% in 2021, a drop of 51% between the two timeframes.
To address the disappointing Indonesian performance, the company is running cross-promotion of new car clients. In addition, iCar Asia launched its iCar Suite in Q4 FY20 as a key subscription revenue driver.
iCar Asia share price snapshot
Over the course of the last 12 months, iCar Asia shares have been volatile moving in large swings. The company’s shares reached a 52-week high of 45 cents, before continuing to decline as low as 23 cents recently. Year-to-date share price performance is down roughly 20%.
On valuation grounds, iCar Asia presides a market capitalisation of about $133 million, with more than 436 million shares outstanding.
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Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.