The REA Group, operators of the leading Australian website of Realestate.com.au together with operations in Hong Kong and Europe announced their full year results for the financial year ending 30 June 2013.
The group saw revenue growth of 21% to A$336.5m with an EBIDTA growth of 30% to A$163.7m. The EBIDTA margin increased from 45% to 49%, still well behind the margin of 73% achieved by Rightmove as reported recently in their half-year results.
The company whilst operating in Luxembourg, Italy and Hong Kong as well as Australia generates just under 90% of revenue from Australian operations and technically all of its EBIDTA from Australia – the group bears a A$5.8m corporate overhead which is larger than the combined EBIDTA of $4.6m from operations outside of Australia.
The most significant contributor to the performance of the company in the past year has been the growth in premium depth products. Growth in this product range across the Australian operation amounted to an incremental $43.1m representing 79% of the overall revenue growth.
Core subscriber revenue growth for the residential business slowed again, in 2012 the growth was 8%, this year slowing to just 4% indicating a critical price point having been reached for core subscription services considering the fairly static number of paying agents at 9,114.
The ARPA grew 26% in the year driven by the strong growth in depth product, at A$1,989 per month it continues to grow at a steady rate.
The Commercial business of the site RealCommercial.com.au saw a rather poor 9% growth in revenue generating A$29m in the year. The company did qualify this performance by disclosing that a component of sales in the second half of the year had been deferred as the product was of longer-duration products with a 90 to 360 day period. This revenue would be reported in FY2014, as an indication of this new business the company commented that measured on a cash basis the revenue was up 23%.
The company reported that the combined Australian websites had a average monthly engagement of 188 million minutes up from 174 million last year, what is interesting is the data reported that the nearest competitor reported as Domain.com.au combined with CommercialRealestate.com.au suffered a significant fall in monthly engagement from 56 million minutes per month to 47 million.
As with most leading portals the importance of mobile continues apace with the combined mobile site and apps representing 37% of traffic up from 22% a year ago. The mobile apps from both realestate.com.au and realcommercial.com.au totaled 2.2 million as at 30th June 2013.
The share market response to the results was mixed, the performance beat market consensus estimates yet the stock slipped on the announcement from A$34 a share to A$32.50 a share. The market capitalization though remains above A$4 billion representing a 26 times multiple of EBIDTA.