From plumbers, carpenters and concreters to electricians, New Zealand job management platform for tradies GEO is experiencing strong growth in both AU and NZ as people spend more time at home renovating.

Busy tradies are good business for New Zealand job management platform GEO Limited (NZX:GEO) which has released its FY21 results showing strong growth trends in new customer numbers and revenue retention.

New customer numbers were up 286% in H2 on pcp and up 87% on H1 FY21. Five of the six largest new customer months were delivered in H2 with an ARR retention rate improvement of 90.5% across FY21.

New licence sales rose 174% in H2 on pcp. GEO reported a 12.9% improvement in net loss from operations, 35.6% improvement in EBITDA and a 10.9% improvement in operating and investing cash outflows.

Group revenue for the financial year fell 17.2%  to NZD$4 million, largely down to the divestment of its GEO for Sales business operations in October 2020 and the impacts of early COVID-19 lockdowns.

 

Organising busy tradies becomes big business

GEO CEO Tim Molloy, who is based in Sydney,  told Stockhead when Covid-19 first hit, prospects looked grim for tradies, like many sectors of the economy, but as people spent more time at home, they became a valuable commodity.

“International borders were closed so people weren’t travelling and had more discretionary money to spend,” he said.

“They were thinking they won’t be doing their overseas holiday so started taking more interest in their homes and renovations or even just repairs.”

Molloy said despite small lockdowns, tradies had never been busier and he expected that trend to continue even post-pandemic.

“Our metrics show jobs would go down on the onset of these lockdowns but quite quickly bounce back up again and often to a higher level,” he said.

“In New Zealand in last year’s lockdown, tradie jobs went down by about 44% but came back to the same level four weeks later before increasing a further 15%.”

 

Who’s going to clean the house?

Molloy said with more people and families spending increasing time at home, demand for cleaners also increased.  Cleaners have become one of the company’s major customer acquisitions over the past year.

“People were home more and thought they didn’t want to have to do all that cleaning, so demand for cleaners boomed, and we saw their use of our platform rise substantially,” he said.

“If you’re a fast-growing cleaning company you need to get systems up quickly to take advantage of this boom.”

 

GEO plans to scale up in Australasia and in the UK

GEO CRO Scott Player told Stockhead FY21 had been a fundamental year for the SaaS company, and it was firmly now in its growth phase.

He said growth had been predominantly centred on GEO’s next-generation app GeoNext that enables small and mid-size trade and home/field service businesses to manage quotes, schedule jobs to staff, track job completion, send invoices and get paid faster.

While the company has been focusing predominantly on Australasia, scaling up in other international markets such as the UK and making GeoNext a market leader was now underway.

Geo plans to double its investment in customer acquisition marketing throughout FY22,  in a bid to achieve its target of 30-40% top line growth.

“We’ve taken some of the learnings from the past 12 months and applied it in the UK and are seeing some nice early signs that it’s a market which resonates,” Player said.

“In terms of scale the UK market is at least three times the Aussie market so if we can get the UK right it will provide a really good growth path for us moving forward.”

 

GEO shares up over 100% in past 12 months

It’s been a positive run for investors in GEO, which undertook a $2 million capital raise in 2020. The share price has doubled from 6 to 12 cents in the past 12 months.

If you’re interested in buying New Zealand shares there are various platforms for investors including Sharesies.

This article was developed in collaboration with GEO, a Stockhead advertiser at the time of publishing.

 This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.

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