Onthehouse gambles on ‘high-risk, high-reward’ strategy

One of the industry’s major portal and software groups has previewed several major new tech releases while posting a near-$9 million loss.

Onthehouse Holdings reported a net loss of $8.7 million for the 12 months to 30 June 2015 compared to a $423,000 profit in the previous financial year.

However, the underlying position was actually positive, with underlying profit rising 1.8 per cent to $665,000.

The big difference between the headline and underlying results was caused by a series of one-off costs, including a $10.5 million non-cash impairment charge relating to the group’s intangible assets in its Consumer Online division.

Revenue declined 0.6 per cent to $26 million, although unique browser numbers jumped 42.9 per cent to 1.6 million and active agency listings jumped 46 per cent to 3,188.

Onthehouse Holdings used its results announcement to paint a bullish picture of its software and technology plans.

“The group remains committed to the high-risk, high-reward opportunity of capturing a significant share of the property consumer advertising spend by creating a disruptive online real estate offering,” it said.

“In the US and Europe, the growth of Zillow and Zoopla are capturing greater market share as they offer a significantly enhanced consumer experience and industry engagement value proposition similar to Onthehouse.com.au.”

Onthehouse Holdings’ software development costs rose to $5.3 million in 2014-15 – up 27.8 per cent from 2013-14 and 114.7 per cent from 2012-13.

The group has been working on a new website for Onthehouse.com.au, which is currently in advanced testing and is scheduled to be unveiled at year end.

Chief executive Chris Meehan said the new website would deliver a new design, “vastly improved speed” and an improved property estimate feature.

Mr Meehan said the group’s Real Estate Solutions business, which provides software for agents and property managers, had begun work on a next-generation software offering.

“The new software-as-a-service platform will enable Console to continue to grow and retain its customer base, increase revenue per agent through cross-selling of additional products developed in-house or via partners, and explore new revenue opportunities,” he said.

“Real Estate Solutions has strong market share, is very profitable and delivers strong cash flow to the Onthehouse group.”

[Related: Onthehouse Holdings announces sell-off]

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