Gonzalo del Pozo is the CEO of the Mitula Group and he recently spent some with the Property Portal Watch team to discuss the Mitula Group business and why they are listing on the Australia Securities Exchange (ASX).
Who is the Mitula Group and what do you do?
The Mitula Group started life in 2009 as Mitula, a Madrid based vertical search company. We provide our advertisers - classified sites (cars, jobs and homes) around the world - with traffic. The model is simple, a property portal or general classifieds site (for example) sends us their listings and we then publish them on our sites. Visitors to our sites then can click on these listings and are then directed back to the listing details page on the originating site and therefore give that site a high quality visit. Most of our advertisers receive clicks for free. However if they want more clicks, they can always pay for them at very competitive rates (on a cost per click basis).
Why did you acquire Nestoria?
We have a mission in the business "to be first choice for classifieds sites around the world for high quality, low cost traffic". With this in mind, we saw an opportunity to bring Nestoria into the Group. They operate real estate vertical search sites in 9 countries and these sites complement our existing operations and therefore allows us to provide advertisers with greater coverage and more clicks.
Are you looking for more acquisitions?
We are definitely looking for more acquisitions. We believe that there are a number of businesses out there that would be great additions to the Mitula Group.
How has the business been performing?
The business is performing very well. We now operate 51 sites in 39 countries. Most of these sites carry cars, jobs and real estate listings. Some also have vacation rentals as well.
In April , the Mitula Group had over 13,000 advertisers posting over 220 million listings across cars, jobs and homes. The Mitula Group network received over 50 million visits in April with Europe and Latin America sites being the most popular. These visitors generated nearly 70 million click outs to our advertisers sites. A great result for a business that is just 6 years old!
What do your financials look like?
We have had great growth of the business. In 2014, we had revenues of AUD 16 million and for the full year 2015, we are forecasting revenues of AUD 23 million. At the same time, our EBITDA margin is getting better growing from 39% in 2014 to 46% in 2015. We have been fortunate to be profitable from the very beginning.
Why are you listing the company?
To deliver on our mission and become the first choice for classifieds sites for traffic, we need to become a much larger business. To do this, we need to have access to funds (and shares) to help us grow the business rapidly. While we are in a great cash flow positive position, we also want to be able to acquire businesses and have access to ready funds and to shares will help us do that. Therefore, but listing the business and becoming a public company, we will be able to quickly and easily fund future acquisition opportunities.
Why are you listing in Australia?
While we are based in Spain, we are really a global business. We have customers all around the world with no single market generating more than 5% of our revenues. So, when it came to listing the company, we decided to look at which markets would make most sense for us. We settled on the Australian stock market for a few reasons.
Firstly, there is a strong understanding of online classifieds businesses with the REA Group, Seek and CarSales all listed there and valued in the billions.
Secondly, there is also a history of businesses being listed there that have operations outside of Australia - for example the iProperty Group, LATAM Autos, iCar and 1-Page.
Finally, our Chairman, Simon Baker, has significant experience with listed Australian businesses. He is the former CEO and Managing Director of the REA Group and the former Chairman of the iProperty Group. Both of these companies had very strong operational and shareholder growth under his leadership.
How much are you raising and how much will the company be valued at?
We are raising AUD 27 million and on listing, it will be valued at AUD 150 million.
When will you actually list?
We are targeting to list the business at the beginning of July.