REA rises in defiance of house price falls
ONLINE property listing company REA Group has reported a jump in quarterly revenue and earnings despite challenging market conditions.
The company behind realestate.com.au yesterday reported revenue after broker commissions of $198.6 million for the three months to March – up 7 per cent from the same period last year.
Earnings before interest, tax, depreciation and amortisation, excluding the group’s share of losses from associates and joint ventures, climbed 6 per cent to $110.7 million.
The result was fuelled by strength in the group’s Australian residential and developer businesses, and the inclusion of numbers from the analytics company it acquired last year, Hometrack Australia.
Still, REA Group warned market conditions were not expected to improve in the short term, with listing numbers impacted by the rapid succession this year of Easter weekend and Anzac Day public holidays, as well as the upcoming federal election.
That was expected to weigh on fourth-quarter results, the group said, and revenue growth this quarter was expected to be slower than in the past quarter.
Chief executive Owen Wilson said: “Our ability to continue to deliver growth despite the significant market headwinds is testament to the strength of our business.
“We remain focused on supporting our customers, who clearly recognise the value we deliver, demonstrated by depth penetration reaching record levels during the quarter.
“It’s almost a decade since we’ve seen market conditions like these, especially in Sydney, where the decline has been the most pronounced.”
Mr Wilson said that with the banking royal commission now finished and the federal election soon to be over, “we expect less uncertainty surrounding the property market as we enter the new financial year”.
REA Group’s trading update yesterday follows a sustained property downturn that has hit capital cities around the country.