Lifull's Japanese Portal Sees Increased Profitability as Overseas Aggregator Sees Sales Impacted in Q1

February 14, 2023
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The Japanese real estate portal operator Lifull yesterday announced its results for the Q1 of the Japanese financial year. Highlights from the company's operations for the three months that ended December 31st include:

  • Revenue of ¥7.5 billion ($57 million), up 1.5% on a like-for-like basis on the comparison period.
  • Operating income of ¥828 million ($6 million), a 41% increase on the comparison period with Net profit up 55%.
  • A dramatic decrease 65% in the cost of revenue thanks to the sale of Lifull Marketing Partners.

Lifull operates the Homes.co.jp portal domestically as well as international aggregators Mitula, Trovit and Nestoria which together with portal assets such as dotproperty, Hipflat, LaEncontré, and Properati form its Lifull Connect overseas segment.

Domestically the company's portal operations saw revenue rise 3.9% on a like-for-like yearly basis with the increase and a lower marketing expenditure contributing to an 84% improvement in the segment's income for the quarter (¥586 million).

The company's flagship portal is the third in a group of four portals with significant traffic in the Japanese market. Lifull has been leaning heavily into virtual and augmented reality technology as it follows a similar tactic to U.S. giant Zillow in trying to create an all-in-one 'hyper super assistant app' for Japanese property seekers.

As for the company's 'Overseas' segment, revenue generation at Lifull's aggregation sites has been stagnant for some time as the model has suffered from changes in Google's AdSense policy. Although Lifulll claims that measures to remedy the AdSense situation are progressing well, the business was impacted over the last quarter by a decrease in premium CPC sales as its portal customers, especially in Southern Europe, re-evaluated expenditure.

In more positive news for Lifull Connect, the company has agreed to purchase the Thai-based portal and brokerage company FazWaz. Synergies between Lifull's existing assets in the region (dotproperty and Hipflat) and FazWaz's agent network are expected to bring great benefit in a region where Lifull Connect already pulls in more than 2 million monthly visits.

February 14, 2023
Since March 2020 Edmund's job has been to read about, write about, collect data on, analyse and generally know about real estate marketplaces and the companies that run them. Before that he worked at the aggregator Mitula Group (which became Lifull Connect) for five years.

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