Depth Revenues Increasing for LatAm Autos Ltd (ASX: LAA)

KEY TAKEAWAYS:

• LatAm Autos’ high margin depth products demand has significantly grown.
• LAA has partnered with the ANCA to use additional sales channel for all depth products and classifieds.
• The company has delivered a strong cash flow during the September 2017 quarter.

LatAm Autos is glad to divulge that its high margin depth products demand has significantly grown. The continued penetration of the high margin depth products moreover enhances the leading position of the market of our classifieds business. This is instigated by the increase of network effects of the leading position of our market and adding customers to our value proposition.

LAA has greatly benefited following its partnership with the ANCA (a national Mexican association dealing with used cars). One of the benefits is the opportunity to use additional sales channel for all depth products and classifieds.

Jorge Ribadeneira, LAA’s CEO and Executive Director stated, “The September quarter was both an exciting one from a business perspective but a sad one as we witnessed the earthquake in Mexico. Thankfully, none of the Company’s staff were affected directly, and our condolences go out to those who have suffered.

From a business perspective, Seminuevos is going from strength to strength with very encouraging organic growth, and we expect continued further growth and decreasing cash burn to accelerate our path to breakeven.”

The impact of restructuring, strong sales momentum and strong organic online traffic flows during the September quarter 2017 instigated the strong momentum experienced by LAA during the same period. This saw the delivery of a strong cash flow during the September 2017 quarter by LAA.

The elements that constituted LAA’s restructure included;

• Focusing on the driving depth product sales within the central growth markets of Ecuador and Mexico.
• Focusing on growing the central markets of Ecuador and Mexico to dominant market positions as well as attaining country wide profitability.
• Reducing sales, administration and marketing costs.
• Managing Peru to ensure optimal cash flows whereas maintaining long-term growth optionality.

LAA remains optimistic that it will accelerate its foremost position as the committed auto classifieds website in Ecuador and Mexico.

Tim Handley, the Executive Chairman, stated, “We are pleased with the strong results of the September 201 quarter and we are optimistic that we will enjoy continued strong sales growth momentum as we approach the end of the year.

We are particularly pleased that our depth product sales volume continues to grow strongly consistent with the strategy outlined during our restructure process. As we continue to monetize our obvious network effects in our core growth markets of Mexico and Ecuador, we look forward to transitioning the Company from its initial growth investment phase to its cash generation phase.”

 

About LatAm Autos Ltd (LAA)

LatAm Autos (‘LAA’) owns the leading automotive classifieds websites in Argentina, Mexico, Bolivia, Ecuador, Peru and Panama; and automotive magazines in Argentina, Mexico, Ecuador, Peru and Panama as well as a regional content website.

Request Information