Airtasker Limited (ART) Earnings Call Transcript & Summary

All right. So one of the things that we love at Airtasker is a little bit of silence to make sure that people can say what they need to say. So we're good at having these silent breaks. But that was a good minute for everyone to join. Welcome this morning to Airtasker's First Half Financial Year '24 Financial Results Presentation. My name is Tim. I'm the Co-Founder and the CEO here at Airtasker, and I'm joined by Mahendra.

Hello. Good morning, everyone. I'm Mahendra Tharmarajah. I'm the CFO at Airtasker.

Thanks, Mahendra. So kicking off, we're going to start with just a little bit of a reminder about Airtasker and what we stand for. So at Airtasker, our mission is to empower people to realize the full value of their skills. And what we mean by that is that our purpose is to help people make money from their unique skills. We believe that every single person's got unique skills. We're really making progress on this mission to empower people to realize the full value of their skills. Since inception, we've created over 13.9 million jobs. We've had over 180,000 people earn money through the Airtasker platform, and we put over $550 million into the pockets of Taskers after we've earned our revenue and net of Airtasker's fees. In order to fulfill our mission, empowering people to realize the full value of their skills, we are doing that by building Australia's and the world's most trusted marketplace to buy and sell local services. And in really, really simple terms, we connect people that need work done with people who want to work. We're doing this in a unique way. First of all, Airtasker is an open community. This helps us create a light touch operating model, which generates very, very high gross margins. And we do this by building a system of transparency and accountability rather than having a big team of manual operations. The second thing that makes Airtasker unique is that we're infinitely horizontal. We don't just offer one service in one category. We actually bring together its long tail of services, all the different things that people need, we can help get done by Airtasker. We had a really, really good first half. We generated positive free cash flow, and we did this by generating solid revenue growth, which we achieved by optimizing our sales funnel. And at the same time, massively improving our operating efficiency by implementing a more lean headcount structure as well as looking into all the ways that we could make our expenditure more efficient. This resulted in us delivering positive free cash flow of $0.1 million, up $4.7 million on the prior period. Our Airtasker marketplaces generated revenue growth of 10.3%. Across to the U.K., we saw our Channel 4 partnership and the launch of our TV campaign on Channel 4, deliver a 30% pop in posted tasks, which we're really excited about, and I'm going to talk about later in this presentation. And we have $17.2 million in cash and term deposits on our balance sheet. So we're well established for the future. Overarchingly, the first half of FY '24 has been very, very successful in delivering profitability, delivering a cash flow generative business, and setting ourselves up for the next phase of international growth. With that, I'm going to pass it over to Mahendra to discuss some of the financial highlights.

Great. Thanks, Tim. So I'm going to start by just, I guess, talking at a very high level about some of the areas that we've been focusing on. And I think we'll talk more about them in the subsequent slides. So we've categorized them as revenues and profitability and the key drivers of the profitability and revenue. So if we start with on the left-hand side, our group revenue is -- the group comprised, obviously, the Airtasker marketplaces, both Australia and international as well as our Oneflare business. So group revenue is up just under 7% to $23 million for the half-on-half. Looking at our Airtasker marketplaces, that excludes the Oneflare business. We're up 10% half-on-half. And then the international markets, so principally our U.K. and U.S. businesses are starting to deliver good growth, albeit off a small base, but we're getting 35% for the half year. We're really pleased, as Tim mentioned earlier, to have hit the free cash flow mark. One of the things we said at the full year results that we were intending to be FCF positive over the full year for FY '24. And we obviously hit that mark a little bit earlier. We're still intending on achieving that over a full year. The other thing that's interesting was we managed to achieve operating cash flow for the half, but also for 2 consecutive quarters, so quarter 1 and quarter 2 per our previous 4Cs that we issued to the market. The other main thing we achieved at the end of FY '23 was we implemented a restructure that resulted in reducing our headcount by about 20%. And we've seen the benefits of that cost reduction come through in the half. So our costs are down about $5.5 million half-on-half. And then finally, we've managed to achieve group EBITDA -- a positive group EBITDA of $2 million. So what that means is basically our businesses are largely paying for themselves down to EBITDA line. So that includes our head office fixed costs as well as our expansion into international markets. So what are some of the things that have driven this result? So we had really good, completed task numbers, so completed tasks were up just over 3.5% on the prior period. Everyone is well aware of the well-publicized macro conditions that are existing out there. So we've seen that in terms of book task being down and average task price being down. But what we've been able to achieve is an improved monetization rates. The monetization rate is at just under 20% now. And then we've seen that improve by 19% half-on-half. And one of the things that's driven that is that our cancellation rate has come down to 28%. And then as Tim mentioned earlier, we've got the U.K. marketing campaign launched in October, and we've seen some initial positive growth in posted task numbers. And all of this is supported by our balance sheet and the cash and term deposits on the balance sheet. If we go to the next slide, unpacking some of those items. I think one of the things we wanted to highlight on this slide is really the trend that we've established over -- we've got 5 consecutive halves there. And really all the metrics are heading in the right direction. So group revenue has been growing. Keep in mind, we have had some challenging times prior to this. And so it was probably the starting point was a little bit slow, but certainly, we're getting the revenue year-on-year. Positive cash flow, as I mentioned. So that was up $4 million, $4.5 million -- $4.7 million on the prior period. And then the operating cash flow, as I mentioned, which is a significant turnaround on the previous period, up $7.5 million and then the group EBITDA, similar sort of turnaround, $7.1 million. If we go to the next slide, Tim. So one of the things that -- or 2 of the things that have really driven this performance is we began introducing a new cancellation policy and fee structure through the half year. And that's improved our marketplace reliability. And the intention of these changes were really to try and improve the user experience on the platform. It wasn't really primarily -- it wasn't principally to generate revenue. It was more around improving the experience for both our customers and our Taskers, so everyone was happy on the platform, and we would improve the lifetime value of those users. And we saw the cancellations have gone down to 16%, so they're down about 28% on the prior period. And then on the other side, we've got the monetization rate coming up. So that has improved to 19.8%. So that's up 19% on the prior period. And so we've been addressing a lot of this, I guess, structural issues by creating incentives on the platform to encourage people to, one, complete task; and 2, not to go off-platform. And what these incentives are doing is starting to build some structure around improving our monetization rate. And we rolled out these initiatives progressively through the half year, so we started off with some policies. Then we had sort of fees that were rolled out to small cohorts of either posters or customers or Taskers. And then it's being progressively rolled out. So we haven't still seen the full impact of these initiatives and we're expecting that to come through in the second half. Next slide, Tim. So as we mentioned, we've got pretty solid revenue growth. The group revenue was up 6%, 7% for the half. And that's been a combination of 2 things. We've seen good supply of Taskers despite the fact that posted tasks have been down and top line -- top of funnel demand has been down. We've had good supply in the marketplace, a good volume of Tasker offers, and that's helped us in terms of the completion rates. The completion rate is quite high. And the product improvements that we've rolled out have been layered on the improvement in the monetization rate. Focusing again on the Airtasker marketplaces, so excluding the one player business, revenue was up 10% half-on-half. And we've -- I think we've seen the bottom of the trough, if you like, in consumer demand in '23, and that started to return towards the back end of the half, and I think we're expecting that to come back in H2. We've seen inflation here. And some of the macro factors of the inflation is monetary policy tightening has been paused. So we're optimistic that consumer sentiment will start to return. And then the Oneflare business, the focus really for the half has been on divesting the noncore assets that we talked about in April. So we've completed those sales through the half, and so that's enabled us now to really focus and it's back on the core business and working on building out the efficiency of that operation. Next slide, Tim. So we talked earlier about the sales funnel and the monetization rate. So while completed tasks are up, the demand has been down and so is the average task price. But we started to see book volumes recover in, I guess, the last couple of months as we head into the second half of '24. And so we're optimistic that the sales funnel optimizations that we put in place through the course of H1 to improve the monetization rate and reduce the cancellation rate, will continue to deliver us value as the consumer demand returns to top of funnel. Next slide, Tim. Thank you. So some of the things that we, I guess, did on the expense side of the business in terms of driving operating efficiency. So we obviously improved our group EBITDA overall, $7 million. And it was driven largely, I guess, from the OpEx side by 2 things. Firstly, the headcount reductions that we implemented in April, May '23, which led to about a 20% headcount reduction across the group. That's obviously translated into a bigger rate reduction in terms of expenses. So we have also had some vacancies during the course of and turnover during the course of the half. We've also been selective about which vacancies we've backfilled or how we backfilled or whether we've repurposed those roles to create, I guess, a more lean and more efficient organizational structure. Our marketing costs have gone up year-on-year or half-on-half. And the main reason for that is we've started obviously accelerating our U.K. television campaign through Channel 4. So we did that deal with Channel 4 in June of '23, where they provided us some advertising media, and we started consuming that advertising media and it's basically being expensed through the P&L. And then in our technology and admin cost group, we've decreased that as a proportion of revenue through a program of expense optimization. So we've been working through all our contracts as they come up, so our supply contracts and looking to either rationalize them and consolidate them or negotiate better terms going forward. So that's been quite successful as well. Next slide, Tim. So how has this translated for us? So positive free cash flow has been the result. Just over 100,000, as Tim mentioned earlier, but it's the delta, which is really the interesting part. So almost $5 million turnaround half-on-half. And that's a combination of the topline revenue growth as well as the operating cost efficiency. And then secondly, the operating cash flow. So we've maintained 2 consecutive quarters in HY -- FY '24, sorry, which we've been positive. So those about 700,000 operating free cash flow. And then what this is telling us is that our core Australian business, our Australian marketplaces are generating sufficient cash to essentially fund a couple of things. Firstly, our global head office fixed cost, so our core infrastructure. And then secondly, the investment in our new marketplaces, so principally the U.K. and the U.S. and supporting the U.K. media partnerships. So in addition to, obviously, the media that we acquired from Channel 4, we had to invest money in creating a television campaign and creative. We have to invest money in paid marketing activities and so on. And I'm going to hand it back to Tim now.

Thanks, Mahendra. So I think a really, really good half in terms of getting back to profitability and getting to cash flow positive, delivered off the back of improvements to the sales funnel, combined with all of those operating efficiencies. So a massive shout out to our team, has done incredible job in a pretty tough environment to deliver what I think is a really, really strong result. Looking forward to the future, so you can really think about Airtasker with 2 main parts to it. The first is that we have $17.2 million in cash and term deposits on our balance sheet. We also have Airtasker's Australian operations, which is cash generative in the first half. When we say it's cash generative, it's generating enough revenue to cover all of our operating expenses globally. So that's our head office, all of our product and engineering function, all of that technology stuff is all being covered and is still generating cash after that. We then have 2 new marketplaces that we're investing in, in the U.S. and the U.K. And really the thesis here is that, it takes an upfront investment to build a network effect and to get a marketplace really moving so that it could be generating cash like it is in Australia. And so we're taking the cash that we're generating through our Australian business, and we're investing that into establishing those network effects in the U.K. and the U.S. to replicate the success that we've proven now in the Australian market. One way that we're turbocharging that cash investment that we're making into the U.S. and the U.K. is to engage media firms into our media for equity partnerships. So in June of last year, we established a partnership with Channel 4, in which they invested $6.7 million of advertising power for a 20% stake in Airtasker. And we're really excited about this because this allows us to reach a huge audience in the U.K. and replicate the success that we had with our Seven West Media in Australia, where we were able to 20x our growth and at the same time deliver Channel 7 a 5x multiple on their investments. So it was really a win-win situation. Last thing I want to highlight here is that we're a very high operating leverage business model. So in that Airtasker Australia business, we're covering all of the product design and engineering that takes to develop a software platform like Airtasker. And so as we go out into the U.K. and the U.S., we don't need to replicate those costs again. The U.K. and the U.S. is all a sales and marketing effort to really build up distribution of this product that we've built and designed in Australia. So if we look at what is our strategy in that Australian business first up, it's to really invest into the customer experience to consolidate the market leadership position that we've built. So we -- this half made some significant improvements to marketplace reliability, for example, implementing a whole new cancellation policy and implementing a smart way of being able to attribute responsibility of any kind of cancellation to either a customer or a Tasker. And what's been really powerful about this is that it's made responsibility really clear in our marketplace, and that's resulted in cancellations coming down 28.4% compared to the previous period. So we've done a lot of work on sales funnels before, getting a 28% improvement in any of these steps in the sales funnel is absolutely phenomenal. So it was a huge amount of effort from the team, and I think a really, really incredible result. We're going to continue to invest in marketplace reliability because this is the #1 thing that our customers are asking for, make the marketplace more reliable, more transparent, and more accountable. The second thing is that we invested a lot into addressing our platform leakage. So as well as having a lot of Taskers doing a record number of completed tasks, we also have tasks that go off-line. And so we did 2 main things here. First of all, we revised our fee structure to reflect and encourage task completion and to disincentivize our task leakage. For example, we bought a connection fee and introduced a connection fee, which basically means that we monetize a task at the beginning of the transaction as well as at the end of our transaction, which means that now 100% of tasks that are booked on Airtasker are monetized. The second thing we did is we implemented our community standards enforcement team to really start enforcing some of the leakage that we saw in our platform and removing some of the bad actors in our marketplace. And this resulted in the monetization rate combined with the efforts on the cancellation rate to improve monetization to -- by 19.3%. The third thing is that we built a lot of tools to help our Taskers be successful in the marketplace. One example of this is that we read through thousands and thousands of messages about why tasks weren't going through to completion, like why they would be canceled. And one of the things that we discovered is that availability is a big issue. And the interesting thing to call out here is it wasn't about scheduling. People don't want to have like a Gmail calendar filled with like lots of little spots about what they're doing. People don't need to be micromanaged like that. But what they do need to be able to do is communicate when they're available, whether it's this Friday, next Saturday, Sunday morning, that's really important and really intuitive. So with that insight, we've built out systems like warning people when the task is urgent. Hey, you booked a task on Sunday already. You sure you want to do this task because this is also on Sunday. We also allow now customers and Taskers to communicate in a very intuitive way when they're available to do tasks. All of these -- this suite of features, which we delivered to make our Taskers more successful, so Tasker engagement actually increased by 24.2% on the previous corresponding period. And that's of some pretty big numbers. I mean we're talking about over 200,000 offers being made per week through the platform. And that kind of engagement improving by 24% year-on-year is absolutely phenomenal. In Australia, we also invested a lot into our brand and to the Airtasker community, and we're going to continue to do that into the future. So some examples of that, Taylor Swift. Everyone's talking about Taylor Swift. And of course, on Airtasker, we had tens of thousands of dollars of GMV going through our marketplace to do everything from buying tickets to queuing up to get Taylor Swift merch through the costume making so that you could look at the part when you go to Taylor Swift's concert. All of this means that Airtasker is really part of the [indiscernible], part of the news media. And you can see here some of the articles that went up on across a lot of the different mastheads are really calling out about how Airtasker has been supporting and being part of the Taylor Swift phenomenon. Other things that we did during the half include rolling out our 2024's annual Tasker awards. We've been doing that for many, many years now. That results in some great media and PR as we recognize our Taskers on shows like Sunrise. We had a brand integration into Amazon Prime's new series, Deadloch, which is really, really great to see. I don't want to spoil any of the murder mystery from that series, but Airtasker feature is pretty heavily in the cast there. And then we do some really good things just to recognize Taskers in our community. So at Valentine's Day this year, rather than handing it up and making it romantic, we took the opportunity to share some love with our Taskers. You can see some of that going down on TikTok and Instagram, which was pretty, pretty cool to see. Overall, this resulted in Airtasker having a brand awareness in Australia of over 64%. And this is a phenomenal thing to see when our investment into above-the-line marketing was basically 0 during this period. We talked a little bit about marketing expenditure, and we've really been disciplined and super highly efficient with our marketing expenditure to maintain brand awareness at that kind of level, it's pretty phenomenal. And that makes us the #1 brand in terms of awareness for local services. So in Australia, we're really protecting our business and driving profitable growth. If we look over to overseas markets, what we're doing is we're looking at what we did in Australia, and we're looking to replicate that success again into the U.K. and the U.S. markets. So in Australia, for over a 5-year period, we partnered up with Seven West Media. And during that period, Seven West Media ended up owning about a 20% stake in Airtasker. And we were able to, during that period through their marketing and advertising grow revenue over 20x during that period. And then to give Channel 7 an exit, that generated them a 5x investment multiple when they exited the business. That was a really, really powerful phenomenon for us. And if you look on this left-hand side chart there, you can see that trajectory that we're able to build in Australia. And if we're able to replicate that success into the U.K. in a much, much bigger market, I think it's super exciting. So we've commenced rolling out that strategy into new markets, starting with our partnership with Channel 4 in the U.K., which gives us $6.7 million of advertising power first up and gives us access to 47 million people in the U.K., which is huge. It's 78% of the U.K. population. So a very, very broad distribution network. So we recently rolled out our U.K. television campaign, which was called Airtasker, Yeahtasker. Yes, it does rhyme. We think it's very, very clever. But if you see the ad, it's really a delightful lab, which pays homage to '90s nostalgia whilst talking about all the different ways that you can get Airtasker to help you get stuff done. We've got an amazing cast, which includes Rose, a lovely handy person in the London market. So this launched in the U.K. in October of 2023, so about 3 months ago on Channel 4. And as soon as that popped up on to TV, we started seeing a really, really strong result with posted tasks increasing about 30% on PCP. What's even more exciting though is that this is what happened in the low period. This is the quiet time, like you've got to project yourself into the Northern Hemisphere of London. This is the rainy time. This is the time where people aren't outside. And you can see there that we've got the spring summer period coming up. So we're really excited to see how this campaign, combined with our marketing investments on top of the TV campaign, really deliver as we head into May and June. Now across to the United States, we're doing a lot of things in the United States. I'm going to talk about them on the next page. But these are some images from Airtasker helping to heal the Bay, which is a Los Angeles social community project. Airtasker has been working on a growth lever called marketplace stimulus, which I'll quickly touch on. Marketplace stimulus is basically -- we sat back, and we thought, why are we going out and giving our money to Google to go and promote Airtasker when we've got this base of like tens of thousands of Taskers in our community who are just dying to get their first job on Airtasker. And so we thought, is there a way that we can create jobs on Airtasker to promote Airtasker. And so we've been stimulating the Los Angeles market. That's resulted in some really, really great results, which has a twofold benefit. One is that we create jobs in our marketplace and our Taskers are able to win their first job, get that first review and build their reputation, our passport, which makes them more trusted to new customers that come in. But at the same time, with that same job, we've got people out there who are doing a letterbox distribution, doing street marketing, all to promote Airtasker again. And so this flywheel that we're building are super exciting. We're seeing some incredible results coming out of this that you can start to see taking effect in the later part of last -- of the previous half and into the new calendar year. Overall, we saw the U.S. deliver a booked tasks growth of about 20% year-on-year. And we've done that in the context of having a much, much lower marketing budget into the U.S. And we're doing this intentionally. We really wanted to prove out the profitability of the model, use this time to fine-tune all of the growth levers because when we land that U.S. media partnership, we're going to want to really, really scale with efficiency. And so I think it's been a great opportunity to get really disciplined, fine-tune the growth levers, and get ready for the next phase of growth. So wrapping up and looking ahead, first half of this financial year has been really, really successful. We've delivered a positive free cash flow, which is in line with the guidance that we gave at the beginning of this financial year. And we can reaffirm that guidance that FY '24, we are going to be delivering our full year positive cash flow results. So we got there early, but we're certainly going to be delivering that for the full year as well. We did a lot of changes during the period, which did 2 things. One, is increase our sales funnel efficiency. Two, is to manage costs and improve our operating efficiency. And we think both of those 2 things are going to combine to deliver further impact as we go into the second half of this financial year. We've got $17.2 million in cash and term deposits on our balance sheet and no debt. And really, what that means is that with that cash and our Australian business now generating a significant free cash flow after covering all of our head office costs, we're in a really strong position to fund expansion into the U.S. and the U.K. and to turbocharge that with our local media partnerships. So lots to be done going into the second half. And -- but I did want to stop and pause and reflect on the great results that we've delivered in the first half, and I congratulate the team on what's been a phenomenal effort in challenging conditions. So with that, open it up to some questions. Mahendra, back to you.

Great. Thanks, Tim. We've got a few questions here. I think we've touched on some of them, but I'll moderate them and read them out and then we can allocate either Tim or myself to respond. So the first question is, can you talk to what you're currently seeing on the platform from a posted tasks perspective? Booked tasks and average task price were both lower in the first half. Is it more of the same so far in third quarter or second half of the year? Or is the consumer getting more confidence in posting more tasks. Tim?

Great question. So the direct answer to that is that the year-on-year gap definitely peaked early on in the half, and we start to see that gap close up and actually return to growth. So that's some really, really exciting news. And I think one of the things about being a real-time marketplace is that we can get a sense of consumer sentiment very, very early on. And so we saw that when interest rates were starting to rise in calendar year '22 and into '23, I think, we felt that impact very early on in the piece. And equally, as consumer confidence starts to improve again, I'm hopeful that we're going to see the impacts of that earlier on, and there's not a huge lag on that.

Great. So the next question is monetization rate has improved significantly. Can you remind us of the work that has been done to date to drive this up? And where you see this potentially impact -- getting to -- sorry once the cancellation fee structure rolls through all the cohorts?

Sure. So first of all, the -- there are a number of steps that we took all aimed at being focused on improving reliability and reducing cancellations in our marketplace. The biggest thing that I would say that we implemented was a very, very clear model of responsibility. So we told customers, here's what you're responsible for, and we told Taskers, here's what you're responsible for. If you can't meet that responsibility, there's a fee associated with that. That's the cancellation fee. And I think that was really, really powerful in incentivizing both customers and Taskers to be aligned and want the same thing, which is not to have a cancellation and to see the task through and to be accountable to that. So that was the work that I would say had the biggest impact on the monetization rate, but that was also supported by a really strong supply side. We had 24%, 25% increase in Tasker engagement on the platform. So it always helps to have more work as higher competition results in higher quality of service. We also had a suite of features, which we just shipped and shipped and shipped and shipped to make small changes to the way that people would communicate, the way that they would be able to share their availabilities and things like that. So all of that had a big impact on the cancellation rate. But these features primarily rolled out between August and September and even some of them only in February of this year. And so really, the numbers which we've shared in terms of the improvements to the cancellation rate and monetization rate are only part of the story because you'll see a full half of that coming into the next half, which is very, very exciting to see.

Thanks, Tim. You mentioned the group intends to accelerate investment in marketing activities to drive revenue growth in the Australian, U.K. and U.S. marketplaces. Is there a set budget for this? And when is this likely to happen?

Well, first of all, I think that what we have been really proud of is building a business which is sustainable and cash flow generative. And as previously communicated, we are very much committed to being full year FY '24 group cash flow positive, and that's going to remain the case for this full financial year. As we generate more cash and we partner with more local media partners who can provide resources to the local entities that we have, we can consider us scaling that further. But I think it's really important to say that certainly for the foreseeable period and this financial year '24, for sure, we have $17.2 million cash on the balance sheet. We've got no debt, and we're generating cash, and that's going to be the case going forward.

Okay. Turning to Oneflare. Can you talk to Oneflare and what you think will be required to see this business accelerate growth? Is there additional investment required?

So the Oneflare business has been really, really -- really, really interesting to see the differences between the Oneflare marketplace, which is primarily focused on the supply side of the market and has much more of a subscription model and helps us to unlock those high-value trades categories versus the Airtasker marketplace, which is predominantly the lower value tasks and pay-as-you-go percentage payment model. So there's definitely some great learnings that we've had about seeing the 2 different business models. Over the past 1.5 years, we've really stabilized that platform and brought it up to Airtasker's standards of technology and product investment. We don't see that there needs to be a massive incremental investment into Oneflare. But certainly, we're going to be working on profitable growth. And that means investing into marketing where it delivers us a significant return on investment. So not expecting to see significant incremental investment. We've got a great team that is responsible and super motivated to make the Oneflare platform a success, but we don't see any incremental technology investment at this stage.

Great. Thanks, Tim. I can take the next one. So as it stands, does the improvement in posted task volumes and monetization rates suggest a pickup in revenue growth in the second half? And I think that's fair. Our expectation is that we are seeing a trend of metrics improving. So suppose tasks are going up, as we've mentioned earlier, consumer sentiment is bouncing back. And the monetization initiatives that we rolled out were only there. We're on a phased basis. So we haven't seen the full impact of that, and we expect that to come through in the second half. Turning to the U.S. Why is growth very low in the U.S.? How is competition? And how many cities are we in? And what's our plan to expand?

Yes. So I think for sure, the growth rate that we want to be achieving is much, much far higher than the 27% that we just shared. It is worthwhile calling out the cost base that was invested into the U.S. market was a fraction of the cost base that we had in the prior corresponding period. So the level of efficiency, I think, is something like 75%, 3 to 4x higher than it was in the previous corresponding period. So I think that context of cost management and cost discipline is really, really important. The reason why we're maintaining that cost discipline is because we think that the right way to fund growth in the U.S. market is our buyer and media partnership. And so we're very much maintaining our resources, making sure that we deliver profitability and sustainability so that when we bring in that media partnership opportunity, we can really turbo the business with a high degree of efficiency. And as we do that, for sure, there is going to be a net cash investment as well, but we're going to do it with much, much greater efficiency than we would doing that without a local media partner. So of course, I'm, obviously, alluding to the fact that a media partnership is possible in the United States. And hopefully, at some point in the near future, we'll have some news to share.

Great. Thanks, Tim. I'll take the next one. So the noncore business divestments was set to take at about $1 million of revenue out of the business. Did this impact the first half? Or will this happen in the second half? So there were sort of 4 noncore assets, I guess, that were acquired as part of the Oneflare business. We divested or disposed of 2 of them in FY '23. And the other 2 through the course of the first half, one was this early in the half and the other one was sort of later part of the half. The impact, I think, will be -- well, so the impact or the contribution, I should say, for the first half was probably quite small from both of them, and we would probably classify them as immaterial contributions. So we don't expect there to be a massive delta half-on-half because of those divestments. Next question, turning to Australian marketing. So Australian marketing spend was reduced to focus on cash preservation. You've still managed reasonable growth despite this, given you've reached cash flow positive, is it time to invest surplus cash back into Australian marketing?

Yes. The unit economics that we -- so first of all, I think it's worthwhile calling out that is definitely the case that we are incredibly lean in marketing in the Australian market. If you look at marketing as a percentage of revenue, it was in the range of 4% to 5%, but if you look at it as a percentage of GMV, which is the real sort of sales figure for Airtasker, we're talking a fraction of that, like circa 2% of our sales going back into marketing. So there is very, very, very lean. In one way, I think, that's great because it demonstrates how powerful Airtasker's organic and brand is, how much revenue we can keep driving even with such a small marketing budget. But it does indicate that there is room to invest. And one of the things about Airtasker is we've got incredible unit economics. So if you look at the average task price being in that range of $240 and our monetization rate getting up closer to 20%, you're talking about $45 to $40 of pure gross margin coming out of an incremental task. And that gives us a huge opportunity to be able to invest in a profitable marketing as we ramp back up. We thought it was really important to not just sort of talk the talk about profitability and cash flow -- being cash flow positive at a group level. So we're committed to delivering that in FY '24. But certainly, we see the opportunity to reinvest in the marketing to deliver more profitable growth is definitely opening back up.

Okay. Thanks, Tim. Next question. So turning to, I guess, a topical area. Are you looking to leverage AI in the short term? If so, can you give us some examples?

Yes. So we're already using AI throughout the business in a number of ways. The first is developers using our GitHub Copilot, and I think there are some great operational efficiency to be had, particularly in technology investment. So a lot of our developers are using a Copilot on a daily basis to be more productive. Another example would be in customer service where we're piloting a chatbot called Brainfish, which allows us to more efficiently and quickly answer our customer service queries. And we've also done some experimentation at a product level where we've experimented with a number of conversational chatbots that can help make posting a task a lot more intuitive and easy by not asking you to fill out a posted task form but rather asking to have a conversation with the chatbot to help describe what you need done in the task. So we definitely starting to look at a lot of these areas to improve operational efficiency and also improve the customer experience. That said, I think, there's clearly an AI hype cycle that's going on right now. And so I think a measured and intentional approach is super, super important. We're not going to be changing Airtasker to AI.rtasker anytime soon because we think it's really important to make sure that we're careful, we watch what's happening and we invest where it makes sense for us at a business level.

Okay. I'm going to take the next one. So the question is what's the revenue target for the U.K. for calendar '24? So our general position is, we don't provide revenue guidance for any market and particularly for newer markets because they're coming off a lower base, and there are too many variables to, I guess, accurately provide guidance to the market. We obviously have our internal targets that we have at various scenarios, but it's certainly something we don't share externally. Next question. What's the plan for EBITDA through to FY '26? Is the plan to stay a green or a positive? Or are we going to be investing?

So I can take an initial stab at that question. So I think definitely, it's important for us as a business to not be in a position where we need to raise capital in the markets, and we can't wash our own face. So from a free cash flow perspective, you can expect that to be certainly cash flow positive in FY '24 and also us having a mindset of being a sustainable cash generative business into the future. In terms of EBITDA, I'd say the one difference between the EBITDA and the cash flow is the amortization of any of the media contract that we do through our local media partnerships. And so for example, with Channel 4, that gave us a lot of media, but we have on our balance sheet, and we're deploying that to grow the network effects in U.K. and that does have a P&L impact without having a cash impact. So I do think that is one major difference. But the principle for business growth is making sure that we're cash generative and not needing to raise capital in order to fund our core business.

Okay. Next question. Do you have a feel for the rebooking or retention rate of customers on the platform?

Yes. So we have some really interesting data around retention and frequency on the platform. And it's so fascinating is when we look at all the customers who used us in the past 12 months, you can see there's incredible retention from prior periods. And so you've got large proportions of revenue coming from cohorts that are 5 years old, 6 years old, 7 years, 8 years old, significant retention. The business problem that we are really focused on though is the frequency. So you're keeping people for a long time, but the time between tasks is too large. And that's indicating that there's a huge opportunity. We have an average purchase frequency per unique paying customer of about 1.8x per year. We think that, that number could be multiples of that. And so if we look at our company mission map, which is where we talk about what our priorities are, the big audacious goal is to move that 1.8x to multiples of that purchase frequency. And so I think what you'll see into the future is some pretty exciting investments actually that we're going to be making to improve customer purchase frequency. So it's lesser retention problem. People love Airtasker. They have a great experience, but it is a frequency problem. They're not thinking about Airtasker frequently enough and generating that frequency of revenue.

Okay. Thanks, Tim. I think that's all the questions. We've got a couple of questions here I think more operationally related to Taskers, and what I might propose is we take those off-line. We'll address those directly with the individuals concerned. Otherwise, I think we've finished going through all the questions. Thank you, everyone, for their attendance today.

Amazing. Thanks, Mahendra. Yes, just thanks, everyone, for your support and attending today and a huge congratulations to the Airtasker team on what was a great result. So thanks so much, team.