Marti Technologies, Inc. (“Marti” or the “Company”) (NYSE
American: MRT), Türkiye’s mobility super app, today announced its
financial and operational results for the first half of 2023.
2023 First Half Year Consolidated Financial and Operational
Highlights
- Consolidated net revenue of $9.5 million during 1H’23, similar
to $9.7 million during 1H’22.
- Cost of revenues, excluding depreciation and amortization,
increased 23% to $8.7 million during 1H’23 compared to 1H’22 due to
higher numbers of field personnel and greater lease expenses driven
by managing a larger scale fleet.
- Average number of vehicles deployed increased by 19% to 34
thousand in 1H’23 compared to the same period in 2022.
- Consolidated adjusted EBITDA was $(8.9) million in 1H’23
compared to $(1.2) million in 1H’22, driven primarily by
investments in scaling the ride-hailing business and secondarily by
back-to-back years of local inflation and the Company’s price
increases in excess of inflation being offset by a decline in
average daily rides per vehicle in the Company’s two wheeled
electric vehicle segment.
- Actions to reduce the cost base of Marti’s two wheeled electric
vehicle segment began in Q2 2023, with a lag to the adverse
movement observed in average daily rides per vehicle.
Marti Founder and Chief Executive Officer
Alper Oktem said, “As we navigate through the evolving landscape of
urban mobility, we believe our strategic addition of ride-hailing
as a new business line has positioned us for growth. Following a
highly successful pilot phase in Q4 2022, we established ride
hailing as a new business line in the first half of 2023. This
addition significantly broadened our service offerings, allowing us
to cater to a more diverse customer base, and aligning our services
with the evolving demands of our ridership.
In line with our strategy of serving as
Türkiye’s mobility super app, we currently offer ride hailing,
e-scooter, e-bike, and e-moped services all under a single app. By
June 30, 2023, our ride-hailing service had gained substantial
traction, boasting over 124,000 riders and more than 40,000
registered drivers. Over 34,000 of these drivers are in Türkiye’s
largest city, Istanbul. This is in contrast to less than 18,395
taxis serving the city. These impressive numbers underscore the
appeal of our services in the Turkish market, and we are further
investing in scaling the business.
Despite the numerous challenges we faced,
including the earthquake in Türkiye earlier this year where we both
assisted in earthquake relief efforts and redeployed our vehicles
from affected areas to other regions, our adaptability allowed us
to maintain our total revenue at a commendable $9.5 million for the
first half of 2023. This resilience demonstrates our commitment to
delivering value even in adverse circumstances. Looking ahead, we
recognize the potential for our ride-hailing business to drive
future growth. We believe our investments will generate lasting
value for our stakeholders.”
Business Updates
Ride-Hailing Revolutionizes Urban Mobility
Embarking on the next stage of Marti’s journey to redefine urban
mobility, Marti introduced its ride-hailing service in Q4 2022.
Following a successful pilot, Marti’s ride-hailing initiative was
established as a new business line in the first half of 2023.
Marti’s service offers both car and motorcycle ride-hailing
options. Riders and drivers agree on the price of their ride in
light of price recommendations for similar past rides, and Marti
currently does not charge a fee for this service.
As of June 30, Marti’s ride-hailing network boasts over 124,000
riders served by a team of more than 40,000 registered drivers, of
which over 34,000 are in Türkiye’s largest city, Istanbul. This
remarkable growth becomes even more significant when compared to
the 18,395 traditional taxis navigating Istanbul. In the first half
of 2023, Marti allocated approximately $1.2 million toward its
ride-hailing headquarters team, consisting primarily of management,
engineering, data science, and marketing personnel.
While Marti already has a significant rider base of over 4.5
million Marti app riders from Marti’s e-bike, e-scooter, and
e-moped services, the Company is further investing in rider
acquisition, and making significant investments in driver
acquisition for its ride hailing business. During the first half of
2023, Marti spent $2.5 million on strategic online and offline
marketing initiatives. Additionally, the cross-promotions Marti
offers for its ride hailing riders to use its two-wheeled electric
vehicle services highlight the complementary nature of its
multi-modal services. The success of these cross-promotions in
driving demand for ride hailing proves the Company’s sound strategy
of building two wheeled electric vehicle services first and
layering ride hailing on top. Although the order in which Marti
introduced these services is different than that pursued by most
ride hailing firms globally, who launched as ride hailing firms
before expanding into two wheeled electric vehicles, Marti believes
that the outcome will be similar.
Looking ahead, Marti aims to surpass 375,000 ride hailing riders
by the end of 2023, a testament to the Company’s commitment to
providing exceptional service to an even larger audience. To
accomplish this, the Company plans to expand its community of
drivers, with a goal of reaching over 80,000 registered drivers by
year-end. These targets also underscore the Company’s belief in
creating economic opportunities for its drivers and offering
affordable transportation options for its riders in an inflationary
economic environment.
Two-Wheeled Electric Vehicle Operations Focused on
Efficiency
The first half of 2023 was marked by high inflation and
substantial currency depreciation in Türkiye. The Turkish Lira
depreciated by 38% in the first half of the year. The May
presidential election was followed by economic normalization
messages from newly appointed Central Bank authorities. Despite the
actions of the Central Bank in raising interest rates, the effects
of these monetary policy decisions will take some time to play out
in the system. In the meantime, inflationary pressures due to
currency depreciation remain pronounced. In the first half of 2023,
the Türkiye government’s year-end inflation expectations were
revised from 22% to 58%.
In response to these challenges, Marti increased its prices by
87% compared to the previous year to counter the inflationary
pressures. While consumer behavior saw a shift, with a 42% decline
in average daily rides per vehicle from 2.15 to 1.25, Marti
increased net revenue per ride by 43% from $0.86 to $1.23 in the
six months ended June 30, 2023.
Marti’s strategic focus in the first half of 2023 was on
operational excellence. Recognizing the importance of streamlined
operations, the Company strategically ceased operations in
underperforming cities. This move optimized the Company’s costs,
allowing it to reallocate its vehicles to higher-performing cities.
Although these underperforming cities contributed less than 8% of
our total revenue, they accounted for over 12% of the Company’s
costs in 2022. By relocating the Company’s resources, the Company
not only reduced expenses but also improved its overall operational
efficiency.
Despite a reduction in fleet size, Marti’s average daily
deployed vehicles increased from 28.7 thousand to 34.4 thousand in
the six months ended in June 30, 2023. Through intensive efforts,
Marti ramped up its deployment rates and vehicle availability. The
implementation of a spare parts usage and expense control system,
coupled with a productivity enhancement project in field
operations, streamlined Marti’s fleet's utilization. Additionally,
the deployment of 2,000 e-mopeds in high-performing areas further
supported Marti’s operational performance. As a result, Marti has
strategically maneuvered to not only maintain its revenue but also
optimize its operations for future growth.
While revenue remained resilient, the cost of revenue, excluding
depreciation and amortization, increased by 23% to $8.7 in the
first half of 2023 from $7.1 in the first half of 2022, affected by
wage increases, relocation of vehicles, and an increased number of
field personnel as Marti deploys more vehicles. Company actions to
reduce the cost base of its two-wheeled electric vehicle segment
began in Q2 2023, with a lag to the adverse revenue impact. General
and administrative costs also increased due to inflationary
pressures on wages, and advisory expenses for the Company’s listing
process. Consequently, adjusted EBITDA margin of the two-wheeled
electric vehicle segment contracted to (49.1)% in 1H’23.
As the Company focuses on growing its ride hailing service, it
will reevaluate opportunities to expand the scale of its two
wheeled electric vehicle services no earlier than the summer of
2024, and on an opportunistic basis at that time.
Operating Results for 1H’23
Consolidated Net Revenues
- Consolidated net revenue decreased by 3% to $9.5 million in
1H’23 compared to the same period in 2022, as the positive effect
of increased average vehicles deployed and pricing actions balanced
the drop in average rides per vehicle per day and lower ride
durations. Revenue generation was impacted by the seasonality of
the business as well as the earthquakes that took place in
February.
Cost of Revenues
- Cost of revenues, excluding depreciation and amortization,
increased by 23%, or $1.6 million, from $7.1 million in 1H’22 to
$8.7 million in 1H’23, primarily due to expansion into relatively
lower demand cities with subscale operations in 2H’22 being
reversed as of Q2 2023, increased field personnel, and operational
lease expense.
General and Administrative Expense; Consulting Expenses
- General and administrative expense increased by 67% to $5.7
million during the six months ended June 30, 2023 compared to the
same period in 2022 as wages increased in line with inflation and
Marti invested in talent prior to its public listing. Consulting
expenses increased by $0.8 million from $0.3 in 1H’22 to $1.1
million in 1H’23 in preparation for the listing. Notably, $1.2
million or 22% of Marti’s general and administrative costs are
attributed to its rapidly expanding ride-hailing division and
investments in its ride-hailing headquarters team.
Selling and Marketing Cost
- Selling and marketing cost increased by $2.5 million from $0.3
million in 1H’22 to $2.8 million in 1H’23. At $0.2 million in
1H’23, selling and marketing cost in Marti’s two-wheeled electric
vehicle business was parallel to the same period in 2022. Selling
and marketing cost in the ride-hailing business was $2.5 million,
driven primarily by driver and rider acquisition campaigns, and
cross promotions at the two-wheeled electric vehicle business for
the ride-hailing riders. As our ride-hailing business has yet to
generate revenue, $0.5 million of variable costs incurred to
generate rides were included in sales and marketing costs. This
includes the data cost of servers and mapping services, and call
center costs for onboarding drivers and offering customer support
in the ride-hailing business.
Cost of Revenues
- Consolidated adjusted EBITDA decreased by $7.7 million to
$(8.9) million, and adjusted EBITDA margin decreased by 81% to
(94)% in the first half of 2023 when compared to the first half of
2022, primarily as a result of investments in the ride-hailing
business. The adjusted EBITDA margin for the two-wheeled electric
vehicle business decreased by 37% to (49)% due to the expanded cost
of revenue base costs.
2023 Guidance
Marti is presenting its full year 2023 guidance, as summarized
below:
2023 Guidance for Consolidated
Operations, including Ride Hailing Investments
NET REVENUE
$20.1 M
ADJUSTED EBITDA
$(17.8) M
The Company’s 2023 Guidance contemplates the following
assumptions:
- Focusing on expansion of the ride-hailing business, which
includes investments in scaling ride-hailing.
- Reevaluating potential two-wheeled electric vehicle investments
on an opportunistic basis no earlier than the summer of 2024 and
factoring in the operational efficiency improvements anticipated in
the Company’s two-wheeled electric vehicle operations.
The full year 2023 guidance provided herein and the targeted
number of riders and registered drivers by year end in the Ride
Hailing Business are based on Marti’s current estimates and
assumptions and are not a guarantee of future performance. The 2023
guidance and targets provided are subject to significant risks and
uncertainties, including the risk factors discussed in the
Company's reports on file with the Securities and Exchange
Commission (“SEC”), that could cause actual results to differ
materially. There can be no assurance that the Company will achieve
the results expressed by this guidance or the targets.
Non-GAAP Financial Measures
This financial information and data contained herein are not
presented in accordance with generally accepted accounting
principles of the United States (“GAAP”) including, but not limited
to, adjusted EBITDA, adjusted EBITDA margin and certain ratios and
other metrics derived therefrom. We define these metrics as
follows:
Adjusted EBITDA as depreciation, amortization, taxes,
financial expenses (net of financial income) and one-time charges
and non-cash adjustments, plus net income (loss). The one-time
charges and non-cash adjustments are mainly comprised of customs
tax provision expenses resulting from the one-time amendment of
customs duties, period adjustments for the founders’ salary which
resulted from a one-time lump sum deferred payment made to the
founders, and lawsuit provision expense which the Company does not
consider the provision to be reflective of its normal cash
operations.
Adjusted EBITDA margin as adjusted EBITDA/net
revenue.
These non-GAAP financial measures are not measures of financial
performance in accordance with GAAP and may exclude items that are
significant in understanding and assessing the Company’s financial
results. Therefore, these measures should not be considered in
isolation or as an alternative to net income, cash flows from
operations or other measures of profitability, liquidity or
performance under GAAP. You should be aware that the Company’s
presentation of these measures may not be comparable to similarly
titled measures used by other companies. The Company believes these
non-GAAP measures of financial results provide useful information
for management and investors regarding certain financial and
business trends relating to the Company’s financial condition and
results of operations. The Company believes the use of these
non-GAAP financial measures provides an additional tool for
investors to use in evaluating ongoing operating results and trends
and in comparing the Company’s financial measures with other
similar companies, many of which present similar non-GAAP financial
measures to investors. These non-GAAP financial measures are
subject to inherent limitations as they reflect the exercise of
judgments by management about which expense and income are excluded
or included in determining these non-GAAP financial measures and
accordingly, should always be considered as supplemental financial
results to those calculated in accordance with GAAP.
This financial information and data contained herein also
includes certain projections of non-GAAP financial measures. Due to
the high variability and difficulty in making accurate forecasts
and projections of some of the information excluded from these
projected measures, together with some of the excluded information
not being ascertainable or accessible, the Company is unable to
quantify certain amounts that would be required to be included in
the most directly comparable GAAP financial measures without
unreasonable effort. Consequently, no disclosure of estimated
comparable GAAP measures is included and no reconciliation of the
forward-looking non-GAAP financial measures is included.
About Marti
Founded in 2018, Marti is Türkiye’s leading mobility app,
offering multiple transportation services to its riders. Marti
operates a ride hailing service that matches riders with drivers
traveling in the same direction, and owns and operates a large
fleet of e-mopeds, e-bikes, and e-scooters. All of Marti’s
offerings are serviced by proprietary software systems and IoT
infrastructure. For more information visit ir.marti.tech.
Cautionary Statement Regarding Forward-Looking
Information
This press release contains statements that are not based on
historical fact and are “forward-looking statements” within the
meaning of the “safe harbor” provisions of the Private Securities
Litigation Reform Act of 1995. For example, statements about the
anticipated growth, including the number of riders and registered
drivers, of the ride hailing business, the full year 2023 guidance,
and the expected future performance and market opportunities of
Marti and the ride sharing business are forward-looking statements.
In some cases, you can identify forward looking statements by
terminology such as, or which contain the words “will,” “aim,”
“anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,”
“forecast,” “future,” “intend,” “may,” “plan,” “possible,”
“predict,” “project,” “seek,” “should,” “target,” “will,” “would”
and variations of these words or similar expressions. Such
forward-looking statements are subject to risks, uncertainties and
other factors. Actual results may differ materially from the
expectations expressed or implied in the forward-looking statements
as a result of known and unknown risks and uncertainties.
These forward-looking statements are based on estimates and
assumptions that, while considered reasonable by Marti and its
management are inherently uncertain and are subject to a number of
risks and assumptions. These statements are not guarantees of
future performance and are subject to risks, uncertainties and
other factors, some of which are beyond Marti’s control, are
difficult to predict, and could cause actual results to differ
materially from those expressed or forecasted in the
forward-looking statements. Known risks and uncertainties include
but are not limited to: (i) the effect of the public listing of the
Company’s securities on its business relationships, performance,
financial condition and business generally, (ii) risks that the
business combination may disrupt the Company’s current plans or
divert management’s attention from its ongoing business operations,
(iii) the outcome of any legal proceedings that may be instituted
against the Company or its directors or officers related to the
business combination or otherwise, (iv) the Company’s ability to
maintain the listing of its securities on the NYSE American, (v)
volatility in the price of the Company’s securities due to a
variety of factors, including without limitation changes in the
competitive and highly regulated industries in which the Company
currently or plans to operate, variations in competitors’
performance and success and changes in laws and regulations
affecting the Company’s business, (vi) the Company’s ability to
implement business plans, forecasts, and other expectations, and
identify opportunities, (vii) the risk of downturns in the highly
competitive tech-enabled mobility services industry, (viii) the
Company’s ability to build its brand and consumers’ recognition,
acceptance and adoption of its brand, (ix) the risk that the
Company may not be able to effectively manage its growth, including
its design, research, development and maintenance capabilities, (x)
technological changes and risks associated with doing business in
an emerging market, (xi) risks relating to dependence on and use of
certain intellectual property and technology and (xii) and other
important factors or risks discussed in the Company’s filings with
the SEC, accessible on the SEC’s website at www.sec.gov and the
Investors Relations section of Company’s website at
https://ir.marti.tech. Any investors should carefully consider the
risks and uncertainties described in the documents filed by the
Company from time to time with the SEC as most of the factors are
outside the Company’s control and are difficult to predict. As a
result, the Company’s actual results may differ from its
expectations, estimates and projections and consequently, such
forward-looking statements should not be relied upon as predictions
of future events. The Company cautions not to place undue reliance
upon any forward-looking statements, including its 2023 guidance
and ride sharing targets, which speaks only as to management
expectations and beliefs as of the date they are made. The Company
disclaims any obligation or undertaking to update or revise any
forward-looking statements, whether as a result of new information,
future events or otherwise, other than to the extent required by
applicable law.
Balance Sheet
(in thousands $)
December 31, 2022
1H 2023
Total current assets
20,455
12,480
Cash and cash equivalents
10,498
3,970
Accounts receivable, net
375
553
Inventories
3,332
3,640
Operating lease right of use assets
2,683
673
Other current assets
3,567
3,644
VAT receivables
3,135
2,721
Other
433
922
Total non-Current assets
20,423
19,225
Property, equipment and deposits, net
19,423
18,689
Intangible assets
160
182
Operating lease right of use assets
841
353
Total assets
40,878
31,705
Current liabilities
15,867
13,338
Accounts payable
3,574
3,558
Short-term financial liabilities, net
7,294
6,104
Operating lease liabilities
2,153
544
Deferred revenue
1,328
1,311
Accrued expenses and other current
liabilities
1,518
1,821
Non-current liabilities
17,412
22,186
Long-term financial liabilities, net
16,38
21,457
Operating lease liabilities
674
290
Other non-current liabilities
357
438
Stockholders’ equity
7,600
-3,819
Capital Paid1
51,282
51,282
Additional paid in capital
3,059
3,640
Accumulated other comprehensive loss
-7,588
-7,558
Accumulated deficit
-39,183
-51,183
Total liabilities and stockholders’
equity
40,878
31,705
Income Statement
(in thousands $)
1H 2022
1H 2023
Revenue
9,731
9,485
Cost of Revenues
-11,625
-13,018
Gross Profit
-1,894
-3,533
Selling and marketing expenses
-235
-3,211
General and administration expenses
-3,390
-5,668
Research and development expenses
-573
-1,500
Other income/expense (Net)
-286
-191
Operating loss before finance
costs
-6,379
-14,104
Financial income
607
2,720
Financial expense
-861
-616
Loss before tax
-6,633
-12,000
Cash Flow
(in thousands $)
1H 2022
1H 2023
Cash flow from operating
activities
Net loss
-6,633
-12,000
Adjustments to reconcile net loss to
net cash used in operating activities
7,114
7,583
Depreciation and amortization
4,834
4,672
Loss of disposal asset
-
162
Stock-based (forfeited), compensation,
net
785
582
Interest expense-income, net
741
550
Foreign exchange losses/ (gains)
420
1,247
Other non-cash
334
370
Changes in operating assets and
liabilities
-2,256
-1,678
Accounts receivable
-292
-177
Inventory
-961
-308
Other assets and prepayments
-1,107
-1,395
Income tax payable
-530
-
Accounts payable
754
-15
Deferred revenue
227
-17
Other liabilities
-347
235
A. Net cash from / (used in) operating
activities
-1,775
-6,095
Cash flow from investing
activities
Purchases of vehicles
-4,443
-3,431
Purchases of other property, plant and
equipment
-226
-497
Purchases of intangible assets
-89
-72
Proceeds from disposal of property, plant
and equipment
-
5
B. Net cash from / (used in) investing
activities
-4,757
-3,994
Cash flow from financing
activities
Proceeds from issuance of convertible
notes
-
7,500
Payments of term loans
-3,041
-3,938
C. Net cash from/ (used in) financing
activities
-3,041
3,562
D. Increase (decrease) in cash and cash
equivalents and restricted cash (A+B+C)
-9,573
-6,527
E. Effect of exchange rate
changes
-337
-
F. Net increase in cash and cash
equivalents (D+E)
-9,910
-6,527
G. Cash and cash equivalents at
beginning of the year
13,216
10,498
Cash and cash equivalents at ending of
the year (F+G)
3,306
3,970
Non-GAAP Reconciliations
(in thousands $)
1H 2022
1H 2023
Net Loss
-6,633
-12,000
Depreciation and Amortization
4,834
4,672
Income Tax Expense
0
0
Financial Income
-607
-2,720
Financial Expense
861
616
Customs tax provision expense
-380
-78
Lawsuit provision expense
-61
67
Salary cut off adjustment
0
0
Other
0
0
Stock based compensation expense
accrual
784
574
Adjusted EBITDA
-1,202
-8,869
Adjusted EBITDA margin
(12.4
)%
(93.5
)%
View source
version on businesswire.com: https://www.businesswire.com/news/home/20231013791686/en/
Investor Relations Contact: Ozge Arcasoy Marti
Technologies Inc. ir.marti.tech investor.relations@marti.tech
Marti Technologies (AMEX:MRT)
Graphique Historique de l'Action
De Avr 2024 à Mai 2024
Marti Technologies (AMEX:MRT)
Graphique Historique de l'Action
De Mai 2023 à Mai 2024