iCar Asia Ltd (ASX: ICQ) shares soared 20 per cent to 32.5 cents in trade today after it reported it hit EBITDA (operating income) breakeven over November 2019. Moreover, it also told investors to expect revenue growth of '50% or more' in 2020.
In fairness some of the forecast revenue growth is be due to the contribution from the acquisition of Carmudi, which is an Indonesian-based automobile website that is expected to help double iCar's Indonesian revenues.
Indonesia is still posting overall EBITDA losses, but it's the modest success of iCar's websites in Thailand and Malaysia that has helped it arrive at 'EBITDA breakeven' last month. In the latter two countries it reports it's delivering consistent positive EBITDA margin growth.
According to its latest Appendix 3B regulatory filing iCar has 424.4 million shares on issue to give it a market value around $138 million based on the 32.5 cents share price.
For the quarter ending September 30 2019 it posted an operating cash loss of $1.5 million on sales of $3.6 million. Therefore we can see a lot of growth is still baked into its valuation.
