This ASX communications share just grew revenue by 150%

Here's what drove this company's revenue higher in 2021.

| More on:
Man puts thumb up next to stock market graph

Image source: Getty Images

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

Key points

  • The Frontier Digital Ventures share price is having a rocky end to the week after it released its earnings for 2021 on Thursday 
  • The online marketplaces provider announced its statutory revenue for the year increased 147% 
  • Unfortunately, the market bid the company's stock down 5% yesterday. Though, it's in the green today 

The share price of ASX communications company, Frontier Digital Ventures Ltd (ASX: FDV) has wobbled over the last 2 sessions after it announced that its profits more than doubled last year.

For those unfamiliar with the company, it specialises in providing online marketplaces and property and automotive verticals in emerging regions.

The Frontier Digital Ventures share price slumped after the company's earnings for 2021 were released yesterday. It ended Thursday's session 5.86% lower at $1.20.

However, it's getting back on the horse today. At the time of writing, the Frontier Digital Ventures share price is $1.24, 2.49% higher than its previous close.

For context, the S&P/ASX 200 Index (ASX: XJO) tumbled 2.9% yesterday. It's recovering slightly today, recording a 0.2% gain.

What's driving this ASX communication share this lately?

The Frontier Digital Ventures share price has had a wobbly performance on the ASX after releasing its full year earnings for 2021. Here are its statutory results:

On the company's results, its founder and CEO Shaun Di Gregorio noted "the difficulties in interpreting [the company's] statutory results given [its] mix of consolidated and equity accounted investments".

He pointed investors to look at the company's portfolio view of its results, instead.

They show revenue of $60.2 million – a 154% increase.

Additionally, the company's portfolio EBITDA came to $1.9 million – an increase of $1.3 million on the prior year's and a new record.

Over 2021, Frontier Digital Ventures recognised 383 million users across its portfolios and 1,253 million sessions.

The company also reported an unrealised currency exchange gain of $8.5 million for the period, compared to 2020's unrealised currency exchange loss of $10.2 million.

What else happened during the half?

2021 was a busy period for the ASX communication share.

It acquired the remaining 43.7% interest in the Moroccan car marketplace, Moteur.ma in January and, in February, announced its acquisition of Chilean auto and real estate classifieds Yapo.cl.

Its acquisition of Yapo cost the company around $24 million.

It was a similar story in June and July when it fully acquired both Infocasas –  the leading property portal in Uruguay, Paraguay, and Bolivia – and Encuentra24 – a general marketplace in 5 Latin American markets.

Frontier Digital Ventures also underwent a capital raise last year, bringing in $53.9 million after offering new shares for $1.50 apiece.

The Frontier Digital Ventures share price gained 4.7% over 2021.

What did management say?

Gregorio commented on the company's earnings for 2021, saying:

We are thrilled to report the ongoing growth of the portfolio across 2021 …

We are delighted with the performance of our key operating companies, as they leverage their market leadership positions to grow transaction revenues and enhance their long-term earnings profile.

In particular, the performance of Zameen and InfoCasas provide our other operating companies with the blueprint for high growth transactional marketplaces.

What's next for the ASX communication share?

The company didn't provide guidance for 2022.

However, it did say it's continuing to explore ways to maximise value for shareholders.

Frontier Digital Ventures share price snapshot

The ASX communications company's share price has struggled through 2022 so far.

It's currently 20% lower than it was at the start of this year. It's also 13% lower than it was this time last year.

Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns and has recommended Frontier Digital Ventures Ltd. The Motley Fool Australia has recommended Frontier Digital Ventures Ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on Earnings Results

Two happy excited friends in euphoria mood after winning in a bet with a smartphone in hand.
Earnings Results

ASX 200 stock jumps 10% on strong FY24 results

How did this KFC restaurant operator perform in FY 2024?

Read more »

A male investor wearing a white shirt and blue suit jacket sits at his desk looking at his laptop with his hands to his chin, waiting in anticipation.
Consumer Staples & Discretionary Shares

Guess which ASX 200 stock just slashed its final dividend by 23%

This retailer had a tough time during the 12 months. Here's how it performed.

Read more »

Man jumps for joy in front of a background of a rising stocks graphic.
Earnings Results

Catapult shines: 20% sales growth propels ASX tech stock to new 52-week high

A strong annual result from this tech player has caught investor attention.

Read more »

A man in his 30s holds his laptop and operates it with his other hand as he has a look of pleasant surprise on his face as though he is learning something new or finding hidden value in something on the screen.
Earnings Results

Xero share price leaps 8% on staggering earnings upheaval

A major turnaround in profitability is sending investors into a frenzy over Xero shares today.

Read more »

a construction worker sits pensively at his desk with his arm propping up his chin as he looks at his laptop computer while wearing a hard hat and visibility vest in a bunker style construction shed.
Materials Shares

Which ASX 200 stock just plunged 12% despite record full-year earnings?

It looks like an impressive report card but UBS doesn't like the FY25 guidance.

Read more »

A man sits thoughtfully on the couch with a laptop on his lap.
Earnings Results

ASX 200 tech stock lifts off on another record-setting half-year profit

Investors are bidding up the ASX 200 tech company following its half-year results.

Read more »

increasing rural asx share price represented by happy looking sheep
Earnings Results

Why is this ASX All Ords stock staying strong as profits crash 76%

How is this company's share price marching higher after mowing down more than three-quarters of its profits compared to a…

Read more »

Two men sit side by side on a couch with video game controls in their hands and expressive looks on their faces as they react to the action in front of them in a home setting.
Earnings Results

Guess which ASX 200 stock is surging 11% on an 'outstanding' result

This ASX gaming giant just posted a 17% jump in profits, and its shareholders are basking in the glory.

Read more »