Mad Paws Advances Acquisition Talks Amid Revenue Growth and Strategic Shifts

Quarterly Performance Highlights

Mad Paws Holding Limited, Australia's leading online pet services platform, has delivered a steady financial performance for the quarter ended June 30, 2025. The company reported group operating revenues of $6.7 million, marking a 2% increase compared to the prior corresponding period. This growth was primarily driven by a robust 31% increase in its Marketplace segment revenue, which benefited from a strategic marketing campaign and a favorable Easter holiday timing shift.

Conversely, the Ecommerce division experienced a 9% decline in revenue, reflecting the company’s ongoing strategic decision to wind down certain brands, including Sash and Waggly. Excluding these brands, Ecommerce revenue showed a modest 3% increase, indicating resilience in core product lines.

Improved Cash Flow and Profitability Metrics

Mad Paws reported a Cash EBITDA loss of just $0.1 million for the quarter, a significant 73% improvement from the prior year. This near break-even performance underscores the company’s focus on operational efficiency and margin enhancement, particularly within its Marketplace business. Operating cash flow was positive at $0.8 million, up $1.0 million year-on-year, supported by disciplined working capital management and a favorable cash cycle inherent to the Marketplace model.

Strategic Transaction with Rover Group

In a major development, Mad Paws entered into a Scheme Implementation Deed with US-based Rover Group, Inc., under which Rover proposes to acquire 100% of Mad Paws shares for approximately $62 million. This transaction values Mad Paws at $0.14 per share in cash, inclusive of an expected $13 million cash inflow from the divestment of the Pet Chemist business to VetPartners Australia.

The acquisition focuses on Mad Paws’ Marketplace operations, with Rover explicitly excluding the Ecommerce assets from the deal. Consequently, Mad Paws is progressing the divestment of Pet Chemist and preparing to close its remaining Ecommerce brands, aligning with the strategic refocus on its core Marketplace platform.

Operational and Financial Discipline

Alongside these strategic moves, Mad Paws has rationalized product and technology employment costs, reflecting the platform’s maturity and a shift towards innovation rather than large-scale development. Capital expenditure was reduced by 66% year-on-year to $0.1 million, while the company also made $0.2 million in debt repayments during the quarter. The company maintains a strong cash position of $2.05 million and has a $2 million loan facility secured with financial covenants in place.

Remuneration payments to executives and directors totaled $87,000 for the quarter, reflecting ongoing governance and leadership costs during this transitional period.

Looking Ahead

Mad Paws’ ability to sustain revenue growth and improve cash flow amid significant strategic transactions demonstrates resilience and operational strength. The successful completion of the Rover acquisition and Pet Chemist divestment will be pivotal in defining the company’s next chapter, focusing on its leading Marketplace platform in Australia’s $30 billion pet services market.