H1 2023 Interim Report - Donkey Republic realizes positive EBITDA and 118% revenue growth in H1-2023. EBIT guidance for 2023 is adjusted upwards.
Financial report for the period 1 January 2023 - 30 June 2023
*Contains inside information*
Company Announcement No. 21 2023
Financial overview
Doubling the revenue and improving the contribution margin to over 50% while keeping the fixed cost on a stable level, enabled Donkey Republic to record a positive EBITDA for the first time in its history. With a profitable operation in place and further bikes available to deploy, the company is in a good position to continue its growth path and achieve its full year guidance. The capital raise that was concluded in July furthermore provides Donkey Republic the capability to pursue growth opportunities.
Guidance for 2023
The revenue guidance for 2023 of 13M to 15M EUR and EBITDA guidance of 1.2M to 1.4M EUR as outlined in the annual report remain unchanged. Also the assumptions highlighted in the annual report remain valid, with the only exception being the roll out of the fleet. With market driven delays in the deal cycle, especially in regards to the periods prior to awarding contracts, the active fleet growth will be lower than originally anticipated. This development however can be compensated by an improved revenue per bike. The slower and lower fleet growth also leads to a reduced depreciation than originally planned, resulting in an improved EBIT expectation for the full year.
Consequently, the revised EBIT guidance is adjusted to negative 1.6-1.3M EUR from negative 2.0-1.8M EUR. The guidance for 2024 remains unchanged as previously communicated.
Highlights for the period - H1
Especially an improved utilization per bike has led to an increase of MaaS rider revenue by 61% vs. the same period last year. Improved product features and better bike availability especially in Donkey Republic’s larger cities have been driving this growth.
Strong increase of over 2M EUR within the MaaS B2G and B2B segment is coming from the completed ramp-up of all major subsidized operations, Antwerp, KielRegion and Turku.
The more than doubling of the revenue was achieved with a merely 49% increase in operational cost, leading to an almost three fold increase of the contribution margin (+280% vs. H1 2022). This improvement is mainly driven by having an experienced and well trained team of shepherds (bike mechanics), that ensure efficient and stable operation across the cities.
The substantial improvements within the contribution margin are the main drivers for recording a positive EBITDA, which is an improvement of 2.4M EUR vs. the first half of 2022. Further supporting this is the fixed cost development that stayed stable over the last year, despite a doubling of the revenue.
Cash and cash equivalents is with 3.6M EUR approximately 40% below last year’s level, but with existing bike orders largely being paid, a positive EBITDA and the capital raise in July, the company sees itself in a good position to further pursue growth opportunities that require bike investments.
Events after H1 2023
Private placement - With reference to Company Announcement No. 14 - 2023, DonkeyRepublic Holding A/S carried out a private placement of new shares, resulting in gross proceeds totaling 2.5M EUR (18.6M DKK). The capital raise was concluded with the purpose of facilitating the pursuit of new long-term subsidized city contracts with subsequent fleet growth, which is anticipated to positively impact the company’s EBT and generate favorable operating cash flows. These contracts are projected to further establish a growth trajectory that positions Donkey Republic for sustained profitability beyond 2024.
This announcement is a summary and should be read in conjunction with Donkey Republics’ Half-Year Report for H1 2023, published on 25 August 2023. A downloadable PDF version will be available on the company website.
