Rightmove (RMV) yet again beat expectations, with 15 per cent growth in underlying operating profits, sending its shares 7 per cent higher on the morning these first-half results were announced. As usual, growth in average revenue per advertiser was the main driver. The average amount paid to the company by estate-agent branches rose 14 per cent to £593 per month on average. In exchange for this, Rightmove lists their properties on its website and offers an ever expanding range of digital tools to help them sell homes.
Interestingly, there was also growth in the number of advertisers for the first time since the 2008 slump. As of 30 June, 18,916 estate-agent branches paid for a presence on Rightmove.co.uk, up from 18,270 in December. But this is not early evidence of a housing recovery, stresses new chief executive Nick McKittrick. Instead, it reflects the popularity of a promotion with very small agents, who previously did not have sufficient stock to justify paying for Rightmove.
The company remains extraordinarily profitable and turned 64 per cent of its revenues into operating cash flow of £42.7m over the period, most of which was distributed to shareholders via share buy-backs (£23.3m) and dividends (£14.1m).
Broker Peel Hunt expects adjusted pre-tax profits of £93m for the full year, giving EPS of 68.7p (from £83.2m and 59.2p in 2012).
RIGHTMOVE (RMV) | ||||
|---|---|---|---|---|
| ORD PRICE: | 2,399p | MARKET VALUE: | £2.45bn | |
| TOUCH: | 2,395-2,405p | 12-MONTH HIGH: | 2,415p | 1,430p |
| DIVIDEND YIELD: | 1% | PE RATIO: | 36 | |
| NET ASSET VALUE: | 11p | NET CASH: | £6.47m | |
| Half-year to 30 Jun | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2012 | 57.9 | 38.9 | 28.6 | 9.00 |
| 2013 | 67.2 | 44.6 | 34.0 | 11.0 |
| % change | +16 | +15 | +19 | +27 |
Ex-div: 9 Oct Payment: 8 Nov | ||||
