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REA Group reflects on strong year

REA Group reflects on strong year

by Simon Parker 0 comments

Simon Parker

A fall in the number of agents subscribing to REA Group’s Australian websites has done little to stifle the company’s growth, with the group reporting robust unique browser numbers and profit growth over the year.

REA Group’s chairman Hamish McLennan told shareholders at the Group’s annual general meeting earlier this week that 2012 had been strong for the organisation across all of its international businesses, pointing to growth in both revenue and profit.

Mr McLennan said while the property market was “softer” in 2012, the group “focused on providing added value to agents through new products and services, as well as by extending listing duration to support agents and help them achieve their business objectives”.

“In 2012, we achieved growth throughout our operations in Australia, Europe and Hong Kong.”

According to Mr McLennan, group financial highlights included:

• Revenue of $277.6 million, an increase of 16 per cent
• EBITDA of $126 million, up 22 per cent
• Net Profit of $86.8 million, up 29 per cent
• Cash grew to $181.6 million, up 32 per cent
• Earnings Per Share of 66.2 cents, up 25 per cent

Greg Ellis, CEO and managing director at REA Group, told shareholders that the result was achieved despite a fall in paying agents, which fell from 22,919 in 2011 to 21,448 in 2012 “due to market contraction and consolidation”.

He said the number of property listings for the group was stable at 1.6 million.

The Australian business accounted for 88 per cent of the Group’s revenue in 2012, followed by Italy with eight per cent, Luxembourg with three per cent and Hong Kong at one per cent.

Within the Australian business, the residential real estate market accounted for 60 per cent – or $152 million – of the Group’s revenue for the year. The number of paying agents in Australia declined from 9,559 in 2011 to 9,069 this year.

A highlight for the group was the uptake of diamond subscriptions, which he said had exceeded expectations.

Mr Ellis also pointed to the group’s success at migrating customers from its website to mobile – while website unique browser numbers declined by 12.1 per cent over the year to 6.5 million, this was partly offset by the rapid rise in mobile unique browser numbers, which rose by more than 100 per cent on-year to 1.35 million.

Average minutes spent on the site per month topped 44 minutes, well up on its nearest rival at 27 minutes, a statistic Mr Ellis pointed to earlier this year that was a key metric for measuring their success.

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REA Group reflects on strong year
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