Leading online freelancing and crowdsourcing marketplace Freelancer Ltd (ASX: FLN) this morning delivered its best quarterly result to the market.
In a statement to the ASX, the $470 million company revealed quarterly cash receipts totalling $13 million for the fourth quarter of its 2016 financial year (FY16). Over the full year the company said receipts were 35% higher.
Freelancer said cash receipts were $51.9 million for the full year but revenue would be higher given its use of accrual accounting, which allows businesses to report revenue before cash payments are made.
The company's operations were also cash flow positive, which is an important step in the right direction. Freelancer had $35 million in cash with no debt at year-end.
The company also boasted about its ability to keep marketing costs low at 16% of cash receipts through efficiencies, thereby lowering its cost base.
But most importantly the company continues to gain traction with creators. Freelancer said 626,000 jobs were posted in the quarter — an increase of 40%. However, the company made a number of acquisitions during the year.
"2016 was a record year of cash receipts for Freelancer and best since IPO in USD constant currency – our highly cash generative business model yielded for the year record receipts from customers, positive operating cashflow and the company has a strong and growing balance sheet," Freelancer CEO, Matt Barrie, said.
Looking ahead the company expects to report revenue higher than cash receipts, when it releases its full-year result on 23 February 2017.
Foolish Takeaway
At today's prices, Freelancer remains richly priced with expectations for strong growth in years ahead. While it could be a gangbusters growth stock, investors seeking to buy shares may want to wade in slowly over time to mitigate the risk of the company missing analyst expectations.
