Indonesian e-commerce company Bukalapak announced Monday that its revenue grew by 86 percent year on year to IDR 898 billion ($57.58 million) in the third quarter of 2022 (3Q22), underpinned by strong performance of its online-to-offline solution Mitra Bukalapak.

Bukalapak said in a statement the group’s revenue for nine months of 2022 (9M22) also rose 92 percent year on year to IDR 2589 billion.

Mitra Bukalapak’s 3Q22 revenues increased by 131 percent year on year to IDR 477 billion, while its 9M22 revenues climbed 191 percent year on year to IDR 1,446 billion.

Mitra Bukalapak’s contribution to the company’s revenues increased from 43 percent in 3Q21 to 53 percent in 3Q22.

Meanwhile, Bukalapak continues to deliver positive business growth with 3Q22 total processing value (TPV) went up by 32 percent year on year to IDR 41.3 trillion.

74 percent of the company’s TPV is from outside the Tier 1 regions of Indonesia, where it continues to see strong growth in all-commerce penetration and digitizing trends among offline micro retail stores.

Mitra Bukalapak continued to generate good growth with its TPV surged by 23 percent year on year to IDR 19.7 trillion in 2Q22 and by 37 percent to IDR 54.7 trillion in 9M22.

Mitra Bukalapak’s growth was driven by an improvement in our product mix and a broader range of service offerings to Mitras.

At the end of September 2022, the number of registered mitra was 15.2 million versus 11.8 million at the end of December 2021.

Bukalapak also recorded a net profit of IDR 3,618 billion in 9M22, as compared to a net loss of IDR 1,128 billion in 9M21.

Having experienced a sustained period of quarter on quarter revenue growth, Bukalapak said the third quarter saw the company focus on generating revenue from a lower cost base to deliver its first positive contribution margin.

In 3Q22, Bukalapak emphasized a reduction in costs and incentives whilst seeking to maintain revenue.

Bukalapak said the firm has clearly demonstrated its ability to deliver on this, which is critical in helping the company reach profitability in the future and proves that the business doesn’t overly rely on spending, promotions and subsidies to generate growth.

It said the company is confident that the business case is established, and Bukalapak will re-focus on growing the top line, whilst continuing to deliver a positive contribution margin.

The company continues to focus on its strategy to deliver positive and sustainable growth, while simultaneously managing its expenses.

The 9M22 general and administrative expenses (excluding stock based compensation) ratio to TPV was 1 percent versus 1.2 percent in the same period last year.

Bukalapak’s overall contribution margin, calculated as gross profit after sales and marketing (S&M) costs, improved from -0.1 percent of TPV in 3Q21 to 0.1 percent of TPV in 3Q22.

The firm has also reported a positive overall contribution margin for the first time this quarter.

Meanwhile, the firm Marketplace’s contribution margin improved from 0.2 percent of Marketplace TPV in 3Q21 to 0.5 percent of Marketplace TPV in 3Q22 whilst Mitra Bukalapak’s contribution margin improved from -0.4 percent of Mitra TPV in 3Q21 to -0.3 percent of Mitra TPV in 3Q22.

Bukalapak’s adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) stood at -IDR327 billion in 3Q22, an improvement in adjusted EBITDA ratio to TPV from -1.1 percent of TPV in 3Q21 to -0.8 percent of TPV in 3Q22.

Meanwhile, the company recorded an operating income of IDR 3,533 billion in 9M22, as compared to operating loss of IDR 1,216 billion in 9M21, primarily due to the marked-to-market gain from the investment in PT Allo Bank Tbk.

In addition to its continued efficiency improvements combined with solid growth figures, Bukalapak also has IDR 20.2 trillion of cash and cash equivalents and liquid investments which include government bonds and mutual funds as of the end of September 2022, which is more than 15 times of its annualized 3Q22 adjusted EBITDA.

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