Mad Paws Marketplace EBITDA Margin Hits 41.7% Amid Strategic Sale

Strong Marketplace Growth Amid Strategic Shift

Mad Paws Holdings Limited, Australia's leading online pet services platform, has delivered a solid financial performance for the 2025 fiscal year, with operating revenues from continuing operations rising 14% to $8.9 million. This growth was underpinned by a 13% increase in Gross Marketplace Value to $39.5 million, driven by more bookings and higher average booking values. The company’s marketplace segment demonstrated impressive operating leverage, with cash EBITDA margins expanding to 41.7%, up 8 percentage points from the prior year.

These results reflect Mad Paws’ scalable platform and disciplined cost management, including a 31% reduction in employment costs and a strategic marketing partnership with Seven West Media. The $4 million marketing contra deployed through this partnership has accelerated brand visibility and customer acquisition, contributing to the marketplace’s momentum.

Divestment and Focus on Core Marketplace

Post year-end, Mad Paws announced a significant strategic pivot by entering a Scheme Implementation Deed with US-based Rover Group, Inc. Under this agreement, Rover intends to acquire 100% of Mad Paws’ shares, focusing on the online marketplace business. Concurrently, Mad Paws is divesting its Pet Chemist business and closing its Sash and Waggly e-commerce brands, marking a clear exit from its e-commerce operations.

The divestment of Pet Chemist is expected to complete by the end of August 2025 for approximately $13 million in cash, subject to adjustments. The closure of Sash and Waggly will see operations cease and deregistration processes commence shortly. These moves aim to sharpen Mad Paws’ focus on its core marketplace, which supports over 300,000 active pet owners and facilitates hundreds of thousands of transactions annually.

Financial Impacts and Outlook

While the group reported a loss before tax of $6.7 million from continuing operations, this was influenced by non-operating costs related to the Rover transaction, impairments on discontinued operations, and increased finance charges from refinancing activities. Importantly, adjusted operating cash flow from continuing operations was positive $1.0 million when excluding one-off items, highlighting the underlying cash-generating strength of the marketplace business.

Corporate costs rose by 27% to $4.2 million, reflecting investments in growth and transaction-related expenses. However, the company improved its operating cash outflow slightly to $0.3 million and reduced investing cash outflows by $1 million compared to the prior year, signaling operational efficiencies as the platform matures.

A New Chapter for Mad Paws

Mad Paws’ CEO, Justus Hammer, emphasised the company’s commitment to unlocking shareholder value through disciplined execution and strategic partnerships. The upcoming acquisition by Rover and the exit from e-commerce mark a pivotal transition, positioning Mad Paws to capitalise on its marketplace’s growth potential in Australia’s $30 billion pet market.

As the company navigates this transformation, investors will be watching closely to see how the integration with Rover unfolds and how Mad Paws leverages its strengthened marketplace platform to drive future growth.