Despite challenging market conditions, REA Group has posted an eight per cent increase in both earnings and revenue for the financial year ending June 30.
Australia’s major real estate listing service announced their results to the market on Friday, which also showed an eight per cent decline in listings over the past year, with the Sydney and Melbourne markets being particularly weak due to 18 per cent and 11 per cent declines in listings respectively.
The results show REA Group has been impacted by the slowdown in property markets across the country but has reported gains with the inclusion of the HomeTrack business along with Commercial and Developer businesses.
Given the recent moves by the RBA to slash official interest rates to one per cent from 1.5 per cent, as well as negative being retained and the recent APRA changes, property markets around the country will likely see improved conditions.
REA’s chief executive Owen Wilson, believes there are some key indicators in place that suggest property markets are turning things around, which should translate into improved earnings, particularly in the latter half of 2020.
“A number of factors are now in place to support a market recovery, including lower interest rates and an improved lending environment,” Mr Wilson said.
“REA has delivered a strong result in a year of unprecedented market conditions. Our continued revenue growth was achieved despite significant declines in listings and new developments – a clear illustration of the value we deliver to customers and consumers.
“Coupled with a very healthy increase in buyer activity, it signals an eventual recovery of listing volumes.”
Mr Wilson was also very positive on how the company’s market share and audience held up during the downturn.
“We increased our audience lead during the year and property seekers are now spending more time on our app than ever before.
“Australians remain passionate about property and they recognise that realestate.com.au is their go-to destination for the best content, deepest insights, and richest market data,” Mr Wilson said.
“The strength of REA’s strategy positions the Group well to continue to deliver superior value to our customers and consumers.”
In terms of their actual numbers, the company’s result was dragged down by impairment charges and brand write-offs totalling $188.9 million.
The directors declared a final dividend of 63 cents a share, up from 62 cents in the same period last year.