Today the REA Group released its full year financials for the 2008 financial year. The results are excellent with strong year on year growth of the business. However, it is the half year on half year growth that shows the truly strong growth of the business.
In the chart below, you can see the year on year growth. Impressively, revenues are up 45% while EBITDA is up 56%.
|$000's||FY 2007||FY 2008|
|Profit After Tax/Minorities||15,064||22,344||48.3%|
If you would like to see the full results, click here - http://investor.rea-group.com/irm/content/newreports.html
When you break down the results into the first and second half of FY 2008, you can see some interesting trends.
|First Half||Second Half||Full Year|
|Profit After Tax/Minorities||7,767||14,577||22,344|
|Expenses / Revenue||80.0%||73.5%||76.5%|
|Net Profit Margin||10.9%||17.3%||14.4%|
|Non Financial KPI's|
|Increase in Employees||108||80||188|
|Increase in Paid Subscribers||1,920||3,547||5,467|
Further analysis reveals, some other observations:
Firstly, display advertising revenue from 3rd parties actually shrunk in the second half of the year. This was counter balanced by strong growth in advertising from the developer market - this is to be expected as developers globally are likely to be having problems in moving stock.
|Source of Revenues ($m)||First Half||Second Half||Full Year||% Change|
|Real Estate Agents||54.7||65.9||120.6||20%|
Secondly, growth in the revenue from the UK operations appears to have stagnated. The good news is that Australia continues to power ahead with 20% half year on half year growth and the Italian business generated strong half year on half year growth of 36%.
|Country Revenues ($000's)||First Half||Second Half||Full Year||% Change|
Finally, when we look at the absolute growth in agents in the first half versus the second half, we can make some observations. When making these observations, it is important to remember that the second half of the year is traditionally stronger in growth as there are European holidays and Christmas in the first half of the year.
|Paying Agents Growth||First Half||Second Half||Full Year||% Growth|