Hipages Group (HPG) H2 2025 earnings summary

Executive summary

• Achieved key strategic milestones, including full migration of over 33,000 Australian tradies to the Single Trading Platform (STP)/Tradiecore and transition to a full subscription model in New Zealand, driving ARPU growth in both markets.

• Demonstrated strong recurring revenue, ARPU, and free cash flow growth, highlighting the scalability and efficiency of the operating model.

• Maintained leadership as the top platform for connecting homeowners with tradies in Australia and New Zealand, with brand awareness at 68%.

• Achieved FY25 guidance for revenue growth, EBITDA margin, and free cash flow, despite executing complex technology migrations and new pricing models.

• ARPU increased 9% to $2,267, with Australia up 8% to $2,381 and New Zealand benefiting from the new subscription model.

Financial highlights

• Total revenue grew 10% year-over-year to $83.1m; recurring revenue rose 12% to $80.8m, now 97% of total revenue.

• EBITDA before significant items increased 20% to $19.6m, with EBITDA margin expanding 2ppt to 24%.

• Free cash flow surged 162% to $5.6m, with free cash flow margin at 47%.

• Net profit after tax reached $2.4m, a significant increase from the prior year (excluding significant items).

• Cash and funds on deposit totaled $26.9m with no debt at year-end.

Outlook and guidance

• FY26 targets: total revenue growth of 10–12%, EBITDA margin of 24–26%, and free cash flow of $8–10m, assuming stable macroeconomic conditions.

• Long-term management EBIT margin target of 30% at scale, leveraging a high fixed cost base for operating leverage.

• Strategic focus on enhancing lead pricing, matching, self-serve capabilities, and embedding AI across products and operations.

• Plans to launch new software features and adjacent services to deepen engagement and open new revenue streams.