Results: Freelancer share price falls 8% despite 120% profit increase

The Freelancer Ltd (ASX: FLN) share price has fallen 1% lower this morning despite recording a 120% increase in its half-year net profit.

| More on:
a woman

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The Freelancer Ltd (ASX: FLN) share price has fallen 8% lower this morning, despite recording a 120% increase in its half-year net profit.

What were the highlights from Freelancer's result?

In its first-half 1H 2019 results, Freelancer reported further strong growth in both registered users and jobs posted on its platform.

Freelancer's total registered users rose to 3.3 million, while 0.9 million jobs were added to the group's platform during 1H 2019.

The company's results presentation also noted the Freightlancer segment, with major customers such as Newcrest Mining Ltd (ASX: NCM) among the 7,000+ operators using the service.

During the half-year period, Freelancer generated unaudited gross payment volume of $400 million which represents a 10% increase on 1H 2018 figures.

The company recorded revenues from ordinary activities of $28.67 million, up 16.1% on prior corresponding period (pcp), while net profit after tax (NPAT) climbed 120% to $157,000 for the group.

Gross profit came in at $24.3 million for the year, up 15% on pcp due to higher revenues, while the company's 85% grow margin was slightly down on pcp due to higher cost of sales coming from its enterprise services revenue

While admittedly off a low base, at the very least it shows that the company's profitability is moving in the right direction even as it continues to build out its operations.

The Aussie growth stock did not declare a dividend as it continues to reinvest in the company and focus on its medium to long-term growth prospects.

Freelancer reported record 1Q 2019 gross GPV from its platform of $158 million, up from 29.2% on pcp.

Freelancer remains free cash flow negative, with net cash used in operations of $987,000 for the half year, down from a net receipt of $1,038,000 in 1H 2018.

This was despite falls across all major cash expenses as the company's receipts from customers nearly halved compared to pcp.

On the balance sheet side, Freelancer reported a minor increase in cash and receivables as total assets climbed to $75.88 million during the year.

Motley Fool contributor Kenneth Hall has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Freelancer Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

More on Share Market News

Fancy font saying top ten surrounded by gold leaf set against a dark background of glittering stars.
Share Gainers

Here are the top 10 ASX 200 shares today

It was another shaky day for ASX shares this Tuesday.

Read more »

forklift holding boxes next to upward trending arrow signifying share price lift

If you don't own this ASX stalwart stock, you're missing some serious stability

This stock is riding strong tailwinds, I really like its outlook.

Read more »

ETF spelt out on cube blocks with rising arrows.

Are these record-breaking ASX ETFs now too expensive to buy?

Should you ever buy an ETF at an all-time high?

Read more »

Two parents and two children happily eat pizza in their kitchen as a top broker predicts a 46% upside for the Domino's share price
Consumer Staples & Discretionary Shares

Buy Domino's shares for a 50% return and attractive dividend yield

Morgan Stanley believes investors should be grabbing a slice of this stock.

Read more »

Three guys in shirts and ties give the thumbs down.
Share Fallers

Why Coles, Liontown, Lovisa, and Wildcat shares are dropping today

These ASX shares are having a difficult session. But why?

Read more »

A businessman looking at his digital tablet or strategy planning in hotel conference lobby. He is happy at achieving financial goals.
Share Gainers

Why DroneShield, Healius, Newmont, and Paragon Care shares are pushing higher

These ASX shares are having a strong session on Tuesday. But why?

Read more »

a mine worker holds his phone in one hand and a tablet in the other as he stands in front of heavy machinery at a mine site.
Materials Shares

Why are ASX lithium shares like Pilbara Minerals crashing on Tuesday?

Lithium stocks are getting another whack today.

Read more »

two colleagues high five each other as they sit side by side at a long desk in front of their laptop computers in an office environment.
Mergers & Acquisitions

Guess which ASX small cap stock is rocketing 27% on 'transformative' merger

Investors are liking the look of this merger plan.

Read more »