Indonesia-based technology firm Bukalapak announced Friday that its revenue grew 29 percent year-over-year to IDR 1.16 trillion ($72.79 million) in the third quarter ended September 30, 2023, underpinned by marketplace segment.
Bukalapak said in a statement that the group’s adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) for the quarter improved by 71 percent year-over-year to -IDR 95 billion.
According to the statement, the group’s marketplace revenue jumped 57 percent year-over-year to IDR 635 billion in the third quarter.
The take-rate in this part of the business has expanded by 109 basis points to 2.96 percent in the third quarter from
1.87 percent in the corresponding period last year due to the improved sourcing and supply chain efficiencies.
The overall contribution margin for the quarter has also delivered a 492 percent improvement year-over-year as the sales and marketing costs slowed.
In the marketplace business, the contribution margin has more than doubled over the past year to 1.03 percent.
73 percent of the company’s total processing value (TPV) is generated outside the Tier 1 regions of Indonesia.
The twin benefits of an all-commerce penetration model and digitizing trends among offline micro retail stores are evident.
Bukalapak said the firm is delivering on the strategy to deliver more profitable and sustainable growth, whilst managing costs and expenses.
It noted the nine-month general and administrative (G&A) expense ratio to TPV has also improved to (0.8 percent) versus (1 percent) in the same period last year.
“We’re pleased with the third quarter of 2023 results, especially the near six-fold increase in contribution margin,” said Teddy Oetomo, Bukalapak’s President.
“We’re on target to deliver our mission of turning profitable in the coming quarters, having posted seven sequential quarters of adjusted EBITDA improvement,
“Once that is achieved, we can focus on consistently growing profitability into 2024 and 2025,” he said.
According to him, these are a solid set of numbers, with strong annual revenue growth and profitability improvements across all its segments, whilst maintaining a pristine balance sheet.
“We have delivered an incredibly strong adjusted EBITDA result in the second quarter, and have now followed this with another quarter-on-quarter improvement,
“We’re continuing to work hard and stay focused for the fourth quarter,” he added.
The firm is maintaining its guidance of being profitable on an adjusted EBITDA basis by the year end 2023.
As the business scales over the coming years, it said the focus is on growing its higher take-rate businesses and driving operational efficiencies so that the long-term
growth momentum continues.
It is noted that Bukalapak has seen the take-rate expand 64 basis points to 2.82 percent in the third quarter from 2.17 percent percent in the corresponding period last year due to the improved sourcing and supply chain efficiencies.
Bukalapak noted that there is scope to improve the take-rate as the benefits of the higher take-rate products are felt across the platform in the future.
It is also noted that the group’s adjusted EBITDA of -IDR95 billion in the third quarter is tracking 18 percent ahead of the original average guidance it gave at the time of the full Year 2022 results where the range was a loss of IDR 100-125 billion for the third quarter.
“Having delivered a robust initial first nine months of trading, we’re very focused on continuing to execute well through the remainder of the year,” said Oetomo.
He said the margin expansion story continues to play out and the business has good momentum as well as excellent future growth opportunities.
“Profitable growth on a sustained basis remains the key commitment and we’re optimistic that we can continue to deliver this for our shareholders over the long-term,” he added.
Bukalapak is a group of tech-based companies and a technology super-enabler for Indonesia’s micro, small and medium-sized enterprises (MSME) transformation and various business verticals.
The firm is building on its heritage of serving more than 130 million users and over 23 million Indonesian MSMEs through its various solutions. It is the first publicly-listed Indonesian technology company.
The firm is now focused squarely on using technology to enable today’s digital lifestyles for both Indonesian MSMEs as well as Indonesians in general, across numerous verticals from marketplace, finance and fintech, offline to online, merchant solutions and procurement.