Good morning, ladies and gentlemen. Welcome to the 2025 AGM for Hipages Group Holdings Limited. My name is Inese Kingsmill, and I'll be chairing today's meeting. It's now 10:00 A.M. in Sydney, and there being a quorum present, I declare the meeting open for business. I also confirm that the meeting has been properly constituted. Before we move to the business of the meeting, I'd like to touch briefly on the format for this year's AGM. To make the experience more engaging and accessible, we've pre-recorded the chair and CEO addresses so you can enjoy a more personable visual presentation from Roby and me. These video addresses will also be available anytime on the Hipages Group Investor Hub, so shareholders who couldn't attend live today and future investors can enjoy them on demand. Today's live session will focus on the formal business of the meeting with a vote by poll.
There'll be an opportunity to ask questions after each item of business, as well as a general Q&A before voting closes. Before beginning the formal business of the meeting, I'd like to ask Kylie Quinlivan, our Company Secretary, today to outline today's procedures and protocols. I also note that our auditor, Louise Harknett at PwC, is in attendance and available later in the meeting to answer any questions on the auditor's report.
Thanks, Inese. The virtual meeting is being held via our share registry, MUFG's online meeting platform. This platform enables shareholders and proxy holders to participate in this live webcast of the meeting, as well as ask questions and submit votes. To enable you to ask questions and submit votes, you will need your HIN or SRN and postcode. You can click the Get a Voting Card button at the top anytime to obtain your voting card. Questions can be submitted at any time. To ask a question, click on the Ask a Question button on the top of the screen. You can choose a specific resolution or general business that your question relates to by using the drop-down box. Those shareholders joining us by telephone today are required to provide a PIN to ask a question on the telephone.
For those of you that do not have the PIN, please contact MUFG on 1-800-990-363. Please note that while you can submit questions from now on, the chair will not address them until the relevant time in the meeting. Kindly include the agenda item number to which your question relates. Please also note that your questions may be moderated, or if we receive multiple questions on one topic, amalgamate it together. Due to time constraints, we may run out of time to answer all of your questions. All questions should be addressed to the chair. The chair will either deal with the question personally or ask someone who is better placed to respond. We will do our best to answer any relevant question raised. I ask that you keep your questions short and to the point so that as many shareholders as possible have a chance to ask a question.
When we reach the formal business of the meeting, voting on all resolutions will be conducted by poll. For the purposes of the poll, the company appoints Aaron Calder of MUFG, the company's share registry, who have examined and prepared summaries of the proxy forms received to act as returning officer and to conduct the poll. Shareholders in attendance virtually that have already submitted a vote by proxy should note that your votes will already be counted towards the poll. You do not need to lodge another vote unless you wish to change your proxy instruction. Shareholders in attendance virtually that have not submitted a vote by proxy and wish to vote on the resolutions being put to the meeting today can do so by registering your shareholding with MUFG.
Instructions on how to register your holding were provided in the notice of meeting and can also be seen on the screen. If you have any problem registering your shareholding with MUFG, please call the support number shown on the screen. To allow shareholders time to log in, the poll is now declared open. Online voting is now open and will remain open until the Chair declares it closed at the end of the formal business. Your votes must have been submitted prior to the portal being closed for them to count. I will now hand back to Inese for her Chair's address.
Thanks, Kylie. Let's now turn to the chair's address, and if you could play the video, please. Good morning, shareholders, and thank you for joining us today for Hipages Group's 2025 annual general meeting. My name is Inese Kingsmill, and I'm the Chair of the company. Today, I'm joined by my fellow directors, Nicholas Gray, Kate Hill, Adir Shiffman, Kate Mills, our CEO and co-founder Roby Sharon-Zipser, as well as Jaco Jonker, our Chief Financial and Operating Officer, Kylie Quinlivan, our Company Secretary, and other members of the Hipages Group management team. FY 2025 was a transformational year for Hipages Group as we continued our evolution from marketplace to SaaS-enabled platform while maintaining trajectory. Our results continue to show the benefits of the disciplined strategic investments we've made with strong marketplace activity on both sides of the marketplace. The group continued its track record of double-digit revenue growth and achieved our FY 2025 guidance for revenue growth, EBITDA margin, and free cash flow.
We reported a statutory NPAT of $2.4 million and delivered a step change in free cash flow generation. The board remains committed to disciplined capital management to ensure the group is well-positioned to fund its growth while delivering long-term value for shareholders. Our robust balance sheet was further strengthened this year by our strong free cash generation with a closing cash balance of and no debt. This provides the group with a strong foundation to continue investing in our strategic evolution, including selectively exploring inorganic opportunities to accelerate our growth and deliver additional capability. In FY 2025, the board determined the best use of shareholders' capital is to continue to invest for growth, and therefore no dividend was declared. Looking ahead, the board will continue to balance the group's investment requirements with capital returns to shareholders.
As a technology company, we see artificial intelligence as an instrumental lever to enrich our user experience whilst also increasing our productivity. We're embedding generative predictions across our product and operations, positioning Hipages to deliver greater value to both homeowners and tradies. For homeowners, this means simpler discovery and smarter ways to plan, connect, and manage projects. For tradies, it means AI-driven tools that support quoting, scheduling, customer management, and business optimization. Cyber resilience, of course, remains a high priority for the board, and we continue to invest in advanced security and privacy technologies, including automated incident response and data detection platforms, while driving a culture of awareness across the group to protect customer trust as digital threats evolve. Our people are central to our growth, and our culture is a competitive advantage.
In FY 2025, the group strengthened engagement, diversity, and well-being, fostering an inclusive and high-performing workplace that lifted capability, resilience, and retention. It is pleasing to see that we have retained strong team engagement with 86% of Hipages' work, and the group reporting its lowest attrition rate in more than a decade. Hipages Group is also recognized by Forbes as a leader in diversity and inclusion and was ranked the number one best place to work for women by Work 180. This is a testament to the strong focus of Roby and the whole team to make Hipages Group a great and inclusive place to work. In FY 2025, the board and management team continued our ESG journey by focusing on what we can control: the experience of our employees, our impact through operations, and the integrity of our governance systems. Rather than chase scale, we pursued authenticity.
This year's achievements reflect deliberate action in support of our long-term ambition to be the most trusted partner in the trades industry. This focus is driving superior customer service. Ultimately, it underpins long-term shareholder value. The group's strategy is clear and simple: a platform-based business and further penetrate the significant addressable market by driving stronger engagement and offering more services to our tradie customers. On behalf of the board, I would like to thank the Hipages Group team for their dedication and execution throughout the year. We feel confident in the strategic direction of the group and the execution capability of the team under the leadership of our CEO and Co-founder, Roby Sharon-Zipser, for his leadership and vision. I'd also like to thank my fellow directors for their counsel and support this year.
Finally, thank you to all of you, our valued shareholders, for your continued support and interest in Hipages Group. I'll now hand over to Roby to talk about our strategic evolution, market opportunities, and outlook.
Thank you, Inese, and good morning, shareholders, and thanks for joining us today. As Inese said, FY 2025. Hipages Group, and I'm very pleased to have achieved our financial guidance while completing the most significant strategic evolution in our history, having successfully migrated our Australian customers onto our new single trading platform and new pricing packages on target. We are seeing encouraging signs of increased retention and engagement from the early cohorts of tradies who are actively using Hipages Trading Core for job management, reinforcing our confidence in our platform strategy. We also successfully transitioned our New Zealand business to a full subscription model, replicating our successful model transition in Australia several years ago. Alongside this, we delivered improvements in our key drivers and a step change in free cash flow generation. Importantly, every incremental dollar of revenue generated in FY 2025 over the prior year delivered $0.47 of free cash.
Turning to our financial highlights for the year, MRR grew by 14% to $7.4 million, driving a 12% growth to $80.8 million. Total revenue grew by 10% to $83.1 million, which was in line with our guidance from the half-year. Our gross profit margin remained very strong at 89% as we delivered a record EBITDA margin of 24%, up two percentage points on the PCP. Net profit after tax was $2.4 million, a significant increase from the prior year. Looking at our key drivers, Group ARPU grew by 9% to $2,267, with the Australian ARPU up 8% to $2,381, and New Zealand's ARPU up 23%, benefiting from all traders now being on a subscription. Our total trading count was stable at 36,600, with 1% growth in Australia offset by an expected decline in New Zealand as we migrated to the full subscription model.
The number of trading homeowner connections remained at record levels at 2.8 million, which reflects healthy marketplace activity. Free cash flow increased materially to AUD 5.6 million, reflecting the significant cash generation potential of our business as we continue to invest for growth. Our strong balance sheet and expanding free cash generation gives us the flexibility to pursue opportunities that accelerate our growth, with a well-developed pipeline of opportunities currently under evaluation. The adoption of job management technology within the trading industry remains in its early stages, and we see substantial opportunity to grow, with currently only 19% penetration of our serviceable addressable market. With trade businesses and particularly sole traders becoming increasingly digital-savvy, we see a huge opportunity to grow by combining our market-leading technology solution with the customer acquisition engine of our marketplace.
In FY 2026, we are focused on driving increased engagement on Hipages Trading Core with new features and functionalities to deliver more intuitive and tailored experiences for both tradies and homeowners. We will be releasing important new features, including self-serve capabilities, while continuing to enhance job matching and lead pricing mechanics designed to make it easier and faster for tradies and homeowners to connect. We will also continue to add new adjacent services and partner offers for our users to further drive engagement and unlock new revenue streams. We expect additional AI integration across our products and operations will further strengthen our offering and unlock new efficiencies. Our subscription model gives us great visibility over future revenues, and our operating model is highly efficient and scalable, which will deliver further operating leverage, margin expansion, and free cash flow generation.
With the heavy lifting of the single trading platform and package migration and New Zealand subscription model implementation behind us, we entered FY 2026 with strong momentum. In FY 2026, we are targeting revenue growth of 10%-12%, an EBITDA margin of 24%-26%, and free cash flow of $8 million-$10 million. I'm pleased to say we are on track to achieve these targets. Additionally, with our largely fixed cost base, we see additional operating leverage and feel confident that over the long term, at current growth rates, we can comfortably deliver a 30% management EBIT or effectively a cash EBIT margin as we strive to achieve the rule of 40. Before I hand back to Inese for the formal business of the meeting, I want to say how proud I am of how excited I am about the opportunities ahead.
We have high ambitions, and I am confident that we have a winning strategy and the team to deliver it. I want to thank the Hipages Group team for their dedication, hard work, and passion, and our board for their guidance during this year of significant transformation. Thank you to our shareholders for your continued support as we build a strong and profitable business fit for the future.
Thank you, Roby. That concludes the presentations for today's meeting. We will now move to the formal business of the meeting as set out in the Notice of Annual General Meeting. The meeting will consider the items of business outlined in the Notice of Meeting disclosed to the market on the 8th of October, 2025. Shareholders received the Notice of Meeting by mail or by email, depending on their election. The Notice of Meeting is to be taken as read. Proxies have been inspected, and all those validly lodged have been accepted. Proxies have been received representing 96,951,135 shares, or about 71% of the issued capital of the company. All undirected proxies or open vote that have nominated the chair as their proxy will be cast in favor of each resolution in the Notice of Meeting. We will now proceed to the resolutions set out in the Notice of Meeting.
The first item of business is to receive the company's annual financial report for the year ended 30 June 2025. The financial report and the reports of the directors and the auditors are now laid before the meeting. There'll be no vote on this item, and this is a discussion item only. The company's auditor for the 2025 financial year, Louise Harknett of PricewaterhouseCoopers, is present to take questions relevant to the conduct of the audit and the preparation and content of the independent auditor's report. Are there any questions or comments on the financial report or the reports of the directors and auditors?
No questions.
Thanks, Kylie. Are there any questions or comments on the management of the company?
Not in relation to the financial statements and reports. No questions. Thanks, Inese.
Are there any questions relevant to the conduct of the audit and the preparation and content of the auditor's report to be put to the auditor?
No.
Okay. We'll now proceed to the resolutions set out in the Notice of Meeting. Item of business two is the adoption of the remuneration report. Resolution two is as follows. To consider and, if thought fit, to pass with or without amendment, Resolution two, adoption of the remuneration report as an ordinary resolution. If you wish to discuss this resolution, please submit your questions via the Q&A. There is a question from Stephen Maine. Thank you, Stephen. The question says, "Did any of the proxy advisors cover us this year, and did any recommend a vote against any of today's resolutions, including this remuneration report item? If so, what reasons did they give, and did this translate into any material votes?" Please don't say they are confidential. It's standard for companies to be across this detail. Stephen, it is private. We're not able to disclose the details of proxy advisor recommendations. Those are private for the subscribers and the individuals who or institutions who subscribe to those reports. So I'm sorry, I can't actually comment on that.
I think that is the only one at this time on that resolution.
Thank you. The proxies received in relation to this resolution are on the screen. I now put the motion. Shareholders can vote via the online portal. Please click for, against, or abstain on your voting card. Item of business three, the re-election of Adir Shiffman as director. Adir joined the board on the 7th of July, 2023. He's an independent non-executive director and is a member of the Remuneration and Nominations Committee. Adir is an accomplished technology sector founder, investor, and executive chair of ASX-listed global athlete analytics business, Catapult Sports.
A registered medical practitioner with a particular interest in subscription software, e-commerce, and health technology, he has advised many of Australia's largest companies, startups, and early-stage companies on their online strategy and execution. Resolution three is as follows. To consider and, if thought fit, to pass with or without amendment, Resolution three, the re-election of Adir Shiffman as director, as an ordinary resolution. If you wish to discuss this resolution, please submit your answers via the Q&A.
As we haven't received any questions, I'm sure.
Thanks, Kylie. The proxies received in relation to this resolution are on the screen. I now put the motion. The next item of business is the re-election of Kate Hill as director. Kate joined the board on the 25th of August, 2023. She's an independent non-executive director and is chair of the Audit and Risk Committee. Kate is an accountant and public company director with over 30 years' experience working with listed and private companies, including over 20 years as an audit partner with Deloitte Australia. She has extensive audit and capital markets experience, including initial public offerings, capital raising, governance, and compliance. She held a variety of leadership and executive roles within Deloitte, including serving for a period on the board of partners of the Australian firm. Resolution four is as follows.
To consider and, if thought fit, to pass with or without amendment, Resolution four, the re-election of Kate Hill as director, as an ordinary resolution. If you wish to discuss this resolution, please submit your questions via the Q&A.
As we don't have any questions on this resolution.
Thank you. The proxies received in relation to this resolution are on the screen, and I now put the motion. The next item of business is the approval of the 2025 equity incentive to Chief Executive Officer Roby Sharon-Zipser. Resolution five is as follows. To consider and, if thought fit, to pass with or without amendment, Resolution five, approval of grant of deferred equity component of the FY 2025 short-term incentive to Chief Executive Officer Roby Sharon-Zipser, as an ordinary resolution. If you wish to discuss this resolution, please submit your questions via the Q&A.
As we don't have any questions on this item of business.
Thanks, Kylie. The proxies received in relation to this resolution are on the screen, and I now put the motion. Resolution six is the approval of the FY 2026 equity incentive award to Chief Executive Officer Roby Sharon-Zipser. Resolution six is as follows. To consider and, if thought fit, to pass with or without amendment, Resolution six, grant of FY 2026 long-term incentive to Chief Executive Officer Roby Sharon-Zipser, as an ordinary resolution. If you wish to discuss this resolution, please submit your questions via the Q&A.
As we have had a question from shareholder Stephen Maine in relation to this resolution, his question is, "Could the CEO summarize his past LTI grants as to whether they have vested or lapsed? Also, has he ever sold any ordinary shares in the company or bought any on market without relying on an incentive scheme to build his equity position in the company? Please don't say look it up in the annual report and through ASX announcements. It's complicated, and the CEO could factually summarize the situation in 60 seconds.
Thanks, Kylie. Roby, a question directed to you. If you could respond, that would be great.
I'm happy to answer that question. Thanks for the question, and I'll summarize it in less than 60 seconds. My trust, so the RSZ Trust, currently holds 7.8 million shares. That balance is obviously starting from an opening balance of about 8.5 million shares. Over the years, 732,000 shares have been allocated that I've been eligible to exercise. I exercised in every year since our IPO any opportunity to exercise those shares, which ultimately results in a taxation event. Last year, around September, I did sell down 1.4 million shares to pay the ATO obligations because of the exercise of those shares, resulting in income tax obligation. That was the primary purpose of that and obviously a slight ability to divest some of when the majority of my wealth sits within Hipages, or my trust's wealth and family wealth sits in the Hipages business.
I'm highly, highly committed to the business. I have not gone on market to buy any shares. I'm only really using the mechanics of the equity that's attributed through the rights in the STI and LTI allocations. I believe I've answered that question. Thank you.
Thanks, Roby.
Yeah. Thank you, Roby. I don't think there are any other questions relating to that resolution.
No, Ines.
The proxies received in relation to this resolution are on the screen, and I now put the motion. Now, if the next resolution relates to myself, I will hand over the chair to Kate Hill.
Thank you, Inese. The next resolution, Resolution seven, concerns the approval of the grant of director equity entitlement to the chair, Inese Kingsmill. Resolution seven is as follows. To consider and, if thought fit, to pass with or without amendment, Resolution seven, grant of director equity entitlement to the chair, Inese Kingsmill, as an ordinary resolution. If you wish to discuss the resolution, please submit your questions via the Q&A.
We have received a question on this resolution from shareholder Stephen Maine. He's commented and asked a question. "You don't normally see chairs getting share allocations via an AGM vote. Why are we doing this, and has there been any protest votes?
I think it's probably best if I hand that question over to Kylie to speak about, if you're okay with that.
Sure. The reason why we get the AGM approval for these votes is the directors receive part of their remuneration as equity. As part of the ASX listing rules, we provide for that to be approved by shareholders for a period of three years. As a growth tech company, it plays a role in enabling us to retain our cash balance that we can put forward, and it also enables that our directors have shareholding interests in the company.
Thank you, Kylie. The proxy voting is available on the screen. I will now put the motion. Thank you. I'll now hand back to Inese for the Q&A and conducting a quick call.
We have a couple of, or a question relating to general business. Shareholder Stephen Maine has asked, "How many full-time equivalent staff do we currently have, and is this likely to fall over the coming 12 months with the rapid rollout of AI? Which parts of our business and operations are the most prospective for AI productivity gains, and how energetically are we embracing those opportunities?
Thanks for the question, Stephen. I think this is the best place for Roby to answer. Roby, I'll hand to you.
Thank you for the question. Hipages has, through either direct employment or through what we have in the Philippines, a BPO structure, and also in Vietnam, what we call a distributed model. Effectively, they work full-time for Hipages, approximately 330 full-time equivalent employees. We do have quite a meaningful operational component where people are supporting our customers every day, whether they're homeowners or tradies. We have many, many systems and processes, some manual, some relatively low-value work. As part of our FY 2026 strategic plan, execution of our plan is to look through enablement of those teams, service, sales, support, operations, to allow them to work on higher-value work and remove some of the more menial work through agents and automation that is readily available and becoming more and more readily available.
We're aggressively rolling that out through a number of teams in the business, through our CRM team, our business transformation team, and our sales transformation team. We've seen a number of roles being redistributed in the organization. We haven't put any real gains in headcount in FY 2026 other than replacement roles. I can see a future where, at some stage, replacement roles may not need to be replaced. That's when people naturally exit. We're still working aggressively to take advantage of a lot of the technology that's being presented in the market. Some are good. Some are bad. We're testing and learning, and we'll continue to apply that into the business to improve productivity and ultimately profitability and free cash flow.
Thanks, Roby. Just to wait a second if there are any additional questions for Q&A. It does not appear that there are any additional questions, so thank you. That concludes the resolutions to be voted on today. As noted, we are conducting a poll on all resolutions, and I note that the poll is already open. Can all shareholders voting online please now ensure that they have submitted their votes, and I will allow another moment before the poll is closed. If you have any questions in relation to the submission of online votes, please send them through the ask a question function now.
Okay. There being no further questions, I declare the poll closed. If the staff of MUFG will now process the poll, the results will be announced to the ASX once they are available. That concludes the formal part of the business. I'd like to thank all shareholders for their attendance and declare the meeting closed. As advised earlier, the results of the poll will be announced to the ASX once they're available. Thank you.