- First-half revenue up 10% to £211.7 million
- Year-to-date shares up 21%
- Interim dividend up 9% to 4.05p per share
Shares in Rightmove (RMV) were marginally lower at 785p in morning trading as the FTSE 100 property portal expressed caution about ongoing revenue growth in the second half of the year.
The company said: ‘Following last year’s record second-half we expect the year-on-year revenue growth percentage in the second half to be lower than the first half.’
SUSTAINED TRAFFIC GROWTH
The UK property portal however reported sustained traffic growth with a total of 9.1 billion minutes spent on the platform in the period, up 10% - its second highest on record.
The company also engaged new customers through channels including Facebook, Instagram, LinkedIn and TikTok.
It was good news for shareholders also as the company returned £112.4 million surplus cash to shareholders through share buybacks and dividends with 9.1 million shares purchased and cancelled to 30 June.
WHAT DID THE CEO SAY
Johan Svanstrom, CEO said: ‘Against a backdrop of a positive market for agents, we have seen an increase in agent formation and estate agents using our top package, Optimiser Edge, which helps maximise their performance.
‘Developers of new builds are turning to marketing products including our new Ascend package to help compete for buyers when the ratio of new builds to resale stock is at a post-Covid low.
‘Our investment in technology and people is yielding results and with continued innovation, we remain committed to improving consumers' overall moving journeys, and enabling our partners to grow, compete, and succeed.’
CAUTIOUS SECOND HALF
Russ Mould, investment director at AJ Bell said: ‘Rightmove is being more cautious with second-half guidance, despite the market pricing in further interest rate cuts from the Bank of England which should improve mortgage affordability.
‘Having achieved 10% sales growth in the first half, forward guidance is for 8% to 10% growth. That explains the share price decline on the interim results.
‘Lower interest rates should, in theory, encourage more activity on the property market. Estate agents who use Rightmove’s platform should feel more confident in spending extra money to promote their listings, in the hope that transaction volumes improve, and they scoop up a tidy commission.
‘Rightmove’s more cautious stance could simply be clever expectations management. It is better to under-promise and over-deliver than do the opposite.’
DISCLAIMER: Financial services company AJ Bell referenced in this article owns Shares magazine. The author of this article (Sabuhi Gard) and the editor (Martin Gamble) own shares in AJ Bell.
