Recently LatAm Autos completed a strategic review which led to its focus on the company's Mexican and Ecuadorean business units where it holds strong and dominant market positions respectively while reducing expenditure in Argentina, Panama and Peru.
In Mexico, LatAm Autos’ strongest performer in 2016 was Seminuevos, demonstrating significant growth in revenue, brand and user engagement. The company expects revenue momentum to continue in 2017 with this month's release of MotorCredit onto the Mexican market.
LatAm Autos has stated that it continues to benefit from clear market leadership in Ecuador as well, with the roll-out of the new revenue streams in 4Q 2016 ― MotorCredit was launched in November 2016.
Also in Ecuador, LatAm Autos claims its 100% owned platform Patiotuerca, has experienced a 57% increase in monthly leads from car buyers to car sellers versus pcp (as at 31 January 2017).
The company has stated that its operations in Peru are expected to be maintained at cash flow breakeven in 2017 while the expenditure in Argentina and Panama will be reduced to minimal levels with the closure of local offices. The Argentina and Panama domains and organic revenues are expected to be maintained to provide future optionality. Senior management remuneration will also be reduced by 25%.
Funding for the updated strategy has been secured through the fully underwritten A$10m convertible note issuance (the “Notes”), which is expected to provide the necessary capital for LatAm Autos to reach cash flow breakeven. The Notes are fully underwritten by Michael Fitzpatrick and Simon Clausen (Directors of LatAm Autos). The proposed Notes will remain subject to shareholder approval being obtained at an Extraordinary General Meeting (“EGM”) to be scheduled shortly. Rothschild retained as corporate advisor to assess ongoing strategic opportunities
Source: LatAm Autos
Edited by: G. Davila