Performing as expected isn’t always enough when you trade on a price-to-earnings ratio of more than 20 as Zoopla-owner ZPG (ZPG) has now discovered.
The shares dive 5.5% to 326p as it posts results that only match expectations for the 12 months to 30 September, rather than exceed them.
ZPG separately announces the £70.7m acquisition of Netherlands-based automated property valuations provider Calcasa.
As we discuss in this article, the company recently bid for comparison site GoCompare (GOCO) as it continues to build on its existing portfolio of businesses in the online property space and in price comparison.
GETTING INTO THE DETAIL
The company has now announced full year revenue up 24% to £244.5m and earnings before interest, tax, depreciation and amortisation (EBITDA) ahead by 25% at £96.4m.
The dividend is hiked 10% as the company ‘remains comfortable with current market expectations’ for £302m of revenue and £118m of EBITDA in 2018.
Net debt is up from £146.5m to £191.5m and is likely to increase further following the Calcasa deal, which involves an upfront payment of £26.5m and a performance-based earn out of £44.2m.
Investec says that in ‘building on its existing Hometrack business - this looks a sensible bolt-on deal at first glance’.
Liberum comments: ‘ZPG remains our favoured portal pick as we view it as the most advanced on the way to monetising the cross-sell opportunity in property, which we have indicated previously as a £3bn opportunity for ZPG. The acquisition of Calcasa today suggests that this focus remains as strong as ever.’
