Domain CEO confident in 'winning back' listings growth
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More news: Domain chief executive Jason Pellegrino said he remains confident in the platform’s ability to “win back” listings growth, as the company’s shares fell on news of its first-half earnings despite a lift in profits.
“The one area that probably didn’t go to plan as we expected it, but we're working on, is that listings coverage. And we’re actually sort of turning that around and closing that gap,” Pellegrino said on the company’s earnings call, stressing the company’s depth penetration growth and uplift in paid listings.
Shares in Domain fell 5.49% at 11:33 am AEDT. Analysts highlighted the company’s underperformance in listings growth compared to market leaders REA Group.
In a note, UBS analyst Lucy Huang said Domain’s listing underperformance of 2% compared to REA Group’s 4% listings growth was likely due to weakness in Tasmania, Western Australia and Queensland.
E&P Capital’s analyst Entcho Raykovski said: “Given the NPAT miss and lower listings, we’d expect the stock to trade lower than the market today".
Domain rides property turnaround as profit lifts 48%
The news: A turnaround in the Sydney and Melbourne property markets has helped Domain drive a 48.7% profit increase for the first half, despite stalling residential listings.
The numbers: Domain posted net profit of $25.8 million for the six months to December 2023, up 48.7% on the $17.3 million reported in the same period last year.
The real estate classifieds business raked in $202.2 million in revenue, up 11% on the $182.1 million reported in the first half of last year. It reported EBITDA of $68.4 million, broadly in line with expectations and up 32% on the $51.8 million in the first half of last year. Earnings per share were 4.1 cents. Listings were down 2%.
What they said: “The first half of FY24 has seen a pleasing turnaround in the property market environment in Sydney and Melbourne, although other markets have remained challenging, impacted by rising interest rates and cost of living pressures,” Domain chief executive Jason Pellegrino said in a statement Wednesday.
“We have retained our disciplined marketplace approach, with operating expenses increasing less than 3% year-on-year in the first half. We continue to be optimistic about the opportunities available to our marketplace and our ambition to become a much bigger business.”
The source: ASX announcement
