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Why the Marley Spoon (ASX:MMM) share price is one to watch today

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The Marley Spoon AG (ASX: MMM) share price slumped 5.6% lower on Thursday and could be on the move again today.

Shares in the Europe-based meal kit company slumped lower yesterday as the S&P/ASX 300 Index (ASX: XKO) fell 2.0% to 6,638.90 points.

However, the company’s latest quarterly update makes the Marley Spoon share price worth watching today.

Why is the Marley Spoon share price on watch?

Marley Spoon doubled its revenue in 2020 with strong growth driven by the United States market.

The company’s fourth quarter update (Q4 2020) for the period ended 31 December 2020 delivered a result broadly in line with guidance.

Marley Spoon expects to post revenue of 254 million euros (A$404.4 million), within the guidance range and up 96% year on year, or 101% on a constant currency basis.

Q4 revenue jumped 95% on Q4 2019 numbers to 69 million euros (A$109.9 million). US revenue surged in Q4, climbing 146% higher compared to Q4 2019 on a constant currency basis.

The Marley Spoon share price will be in focus today after the company posted its fourth consecutive quarter of active subscriber growth. Average active subscriber numbers climbed to ~233,000 compared to Q1 2020 figures of ~142,000.

Q4 2020 was also the third consecutive quarter of positive operating earnings before interest, tax, depreciation and amortisation (EBITDA). Operating EBITDA totalled 1 million euros (A$1.6 million) for the final quarter of 2020.

Marley Spoon reported unaudited quarterly operating cash flow of -3.6 million euros (-A$5.7 million). That saw the company book a total year-end cash balance of 34.4 million euros (A$54.8 million).

The company’s global contribution margin reached 29% despite Q4 impacts of COVID-19 and peak e-commerce holiday season.

The Marley Spoon share price has surged over the past year. In fact, shares in the meal kit delivery group are up 920% in the last 12 months. Strong growth in the lucrative US market has been key to the company’s robust earnings and share price gains. 

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Motley Fool contributor Ken Hall 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.

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