REA Group’s profit fell in 1HY23, but it wasn’t all the wrath of the property market?

Nick Sundich Nick Sundich, February 10, 2023

Not even $16bn REA Group (ASX:REA) can escape the slump in the property market. The company reported its 1HY23 results this morning and saw a 9% drop in residential listings. But was it all the property market?

 

No time to do stock research, but you still want to invest?

 
Stocks Down Under Concierge gives you timely BUY and SELL alerts on ASX-listed stocks!
With price targets, buy ranges, stop loss levels and Sell alerts too.

 

GET A 3-MONTH FREE TRIAL TO CONCIERGE TODAY

 

REA records 5% higher revenues

REA recorded $617m in revenue, a figure that was actually 5% higher than the prior corresponding period. This was underpinned by yield growth in the company’s advertising products in Australia and India.

Residential listings were down 9% nationwide and down 17% in Sydney. But the company claimed that customers were relying on its premium products to maximise the impact of their campaign. 

 

But a 9% decline in NPAT

On the flip side, a sharp rise in operating costs led to a 9% decline in NPAT to $205m. EBITDA fell as well – by 2% to $359m.

REA blamed higher marketing, employee and travel costs, but also noted that cost growth reflected reduced costs from the prior corresponding period due to lockdowns.

 

When will things recover?

REA CEO Owen Wilson said that activity in the property market would pick up when interest rates stabilised. He wouldn’t put a specific timeframe on this, noting that the uncertainty caused by rising interest rates would likely continue in the coming months. 

All things considered, it could have been a lot worse for REA shareholders. The stock is only slightly down this morning.

 

 

Stocks Down Under Concierge gives you timely BUY and SELL alerts on ASX-listed stocks!
 
With price targets, buy ranges, stop loss levels and Sell alerts too.

 

GET A 3-MONTH FREE TRIAL TO CONCIERGE TODAY

 

No credit card needed and the trial expires automatically.

 

Blog Categories

Get Our Top 5 ASX Stocks for FY25

Recent Posts

Nuix

Nuix (ASX:NXL) has quadrupled in 12 months! But is more growth to come?

Nuix (ASX:NXL) has been one of the most controversial companies on the ASX since it listed, but has it turned…

ASX Biotechs

Here are 3 ASX biotechs with major milestones coming right up!

Investing in ASX biotechs is a risky business, even more than most other companies on the market. Unless you own…

buy the dip

When do you know it’s time to ‘buy the dip’? You could be catching a falling knife

‘Buy the dip’ – have you ever heard that term? It implies that when a company’s share price ‘dips’ or decreases,…