Link copied to clipboard
In a depressing environment for small-cap trading stocks, investors are on the hunt for the few corporations with a physically powerful business style aligned with the frugal consumer mindset.
We’re not talking about suppliers of brown rice and kerosene – or not yet – but less expensive vacations.
Camplify (ASX:CHL), the Airbnb of the caravan and RV industry, is navigating both its housing market and Europe, where it has ramped up its acquisitions.
Camplify, a former peer-to-peer operator, connects recreational vehicles (RVs) with renters and facilitates contracts, insurance, and bills in exchange for a large portion of the ticket.
Camplify founder and CEO Justin Hales says that as the economy shrinks, the RV industry plays more, a trend that’s evident since the 1970s.
“Clients are determined to take a vacation, but they need to (optimize) their spending,” he said at Australia’s recent microcaps investment conference. “We will offer relatively affordable vacations. “
He says Camplify is 25 to 30 cents less expensive than classic campervan rental companies, which congregate on the airport’s expensive grounds and concentrate on inbound tourism than domestic tourists.
On the source side, there are 800,000 personal motorhomes in Australia and most of them stay in the driveway for 46 weeks a year. Monetizing those assets through an intermediary is a surefire way to stretch household budgets.
By contrast, Hales says, the company is limited by supply. It lists 15,000 motorhomes here and 18,000 in Europe, which is a fraction of the market compared to owning a van.
Camplify recorded a total transaction (TTV) of $146 million in the year to June 2023, an increase of 172%. Revenue soared 133 percent to $38 million, with gains in New Zealand, also known as RV Isle, up 1,100 percent.
Last week, the company reported a September TTV (first) quarter of $41. 5 million, an increase of 107 percent, and a profit of $11. 7 million (an increase of 114 percent).
For the fourth consecutive quarter, the company also posted positive revenue of $80,000, compared to $1. 6 million a year ago.
From the average booking payout of $1,733 in 2022-2023, Camplify recouped $437 (25 per cent), but this segment of the price is now close to the target of 30 per cent.
In the future, Camplify expects to earn almost as much from its insurance operations, MyWay, as it does from booking fees.
For investors, Camplify has been a comfortable ride since the company went through Covid in June 2021, with the stock gaining more than 50 percent.
Hales notes that Camplify has an overall market share of 1% across all of its geographies.
One outstanding question is whether Camplify is vulnerable to a new festival as peer-to-peer giants seize this opportunity.
Hales says other people like Stayz don’t see the company as significant and would struggle to achieve economies of scale.
“We’ve built a platform for accommodation on wheels, very different from a hotel or a car rental,” he says.
“Stayz is unlikely to launch, but they could always acquire the leading operator and that happens to be us.”
There is a precedent. The owner of major Maui and Britz brands, New Zealand’s Tourism Holdings, last year acquired Apollo Tourism and Leisure, an ASX-listed RV rental company, but not before it was closely vetted by the festival’s watchdog.
This story does not constitute a recommendation on monetary products. You deserve to seek independent advice before making any monetary decisions.
The perspectives, information, or reviews expressed in interperspectives in this article are solely those of the interviewees and do not constitute Stockhead’s perspectives. Stockhead does not provide, endorse, or otherwise assume responsibility for the monetary product recommendation contained in this article.
Link copied to clipboard
Get the newest Stockhead delivered to your inbox for free.
Get the latest inventory news delivered straight to your inbox.
By continuing, you confirm that we process non-public data in accordance with our Privacy Policy.