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REA Group has posted a strong result in Q3 of the financial year, reporting year-on-year revenue growth of 23 per cent off the back of the housing market’s record prices.
The company, which operates realestate.com.au and is owned by NewsCorp Australia, brought in revenue totalling $869 million in the nine months to March 31 2022, with a quarterly earnings before interest, tax, depreciation and amortisation (EBITDA) of $523 million.
Putting the results down, in part, to the country’s strong performance in residential property, REA Group chief executive officer Owen Wilson commented: “Australians transacted property at pace during the quarter as continued high demand gave sellers the confidence to bring their properties to market.
“These conditions, combined with record take up of our premium products, contributed to our very strong result. We also continued to see excellent growth in our strategically important financial services, data and Indian businesses.”
The company noted that its July 2021 acquisition of Mortgage Choice had also helped instil confidence in the brand’s growth.
The deal, which added a substantial broking footprint to the REA Group’s operations, was finalised at the start of the financial year following clearance of the arrangement by the Supreme Court of NSW. At the time, the enterprise value of the mortgage business was estimated at $244 million.
The group’s latest financials confirmed it was continuing to target full-year positive operating jaws, excluding the impact of the REA India and Mortgage Choice acquisitions, with low double-digit operating cost growth expected.
Mr Wilson commented on the outlook for closing the year on strong footing, despite the fact that April national residential listings were shown to be down 8 per cent year-over-year.
“The Australian property market is very healthy. While we are seeing housing price moderation in some areas, the strong economic fundamentals will continue to support robust conditions beyond this quarter. We are excited by the significant growth opportunities throughout our business and are well positioned to deliver another strong full year result,” he said.
The group’s financial report stated that it anticipated Q4 volume headwinds would be offset by higher residential and commercial yields supported by contracted price rises and increased depth penetration. It also noted that strong deferred March volumes would be reflected in Q4 results and expects growth in revenue from both its REA India and data operations.
Of the performance of the group’s flagship product, Mr Wilson said the audience to realestate.com.au was the “largest and most engaged” it’s ever been.
“This is key to our success, and we were pleased to realise a strong increase in active members during the quarter, with greater uptake of our property tracking and valuation tools,” he noted.
ABOUT THE AUTHOR
Juliet Helmke
Based in Sydney, Juliet Helmke has a broad range of reporting and editorial experience across the areas of business, technology, entertainment and the arts. She was formerly Senior Editor at The New York Observer.
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