- Expects full year 2024 revenue growth of 18%
- Shares up 101% over the past year
- North America bookings up 26%
Shares in Trustpilot (TRST) were up more than 16% to 320p in morning trading as the online reviews and analytics platform said it is expecting to report revenue of $211 million for full year 2024, a rise of 18% compared to $176 million last year.
Adjusted EBITDA (earnings before interest, taxation, depreciation, and amortisation) is expected to beat analysts’ consensus estimates of $22.2 million.
BOOKINGS UP
The Denmark-based business said it expects to report a 23% year-on-year rise in bookings to $239 million for the full year 2024 with particularly robust growth from its North America region - up 26%.
Other regions performing well include the UK where bookings were up 22% followed by Europe which saw bookings 18% ahead.
Trustpilot’s CEO Adrian Blair said that the company focused on B2B product innovation and new pricing and product packages last year.
‘As a result, we delivered strong new business growth, combined with a significant improvement in the NDR (net dollar retention rate).’
NDR is calculated by comparing revenue generated by existing customers at the start of a period with revenue generated from those same customers at the end of the period.
Trustpilot said NDR is expected to be 103% for the last 12 months, marginally higher than full year 2023 at 99%.
The company delivered strong cash generation, resulting in cash at 31 December of $69 million (compared to $91 million in full year 2023) after completing a $43 million share buyback programme.
Trustpilot is expected to report its full-year results on 18 March.
EXPERT VIEWS
Russ Mould, investment director at AJ Bell said: ‘Navigating the internet and deciding if you can trust the website through which you are ordering products and services is a key part of everyday life for millions of us. This is no surprise given the alternative is being ripped off or ending up with a substandard experience.
‘In this context you can see why the reviews served by Trustpilot might be in heavy demand and, sure enough, its latest update reveals strong levels of growth and an earnings upgrade. It’s the kind of news which would earn a five-star rating with most shareholders.
‘The more people use its site and post reviews, the more it derives network benefits. As more consumers use the platform and share their own opinions, the richer the insights the company can offer clients.’
Berenberg analysts are positive about the stock saying that North American region is the ‘standout performer.’
‘We understand the improvement in North America has been a key driver of the increase in the group NDR. This is another sign that the value proposition is resonating with customers, and the flywheel effect is in action.’
DISCLAIMER: Financial services company AJ Bell referenced in this article owns Shares magazine. The author of this article (Sabuhi Gard) and the editor (Martin Gamble) own shares in AJ Bell.
