26th Jul 2019 09:11
(Alliance News) - Property website Rightmove PLC on Friday reported a rise in first half pretax profit and said it will buy a tenant referencing services company for up to GBP20 million.
Rightmove will pay an initial GBP16 million for Van Mildert Landlord and Tenant Protection Ltd, a tenant referencing services and rent guarantee insurance firm. The acquisition also includes future deferred consideration, payable in 2022 and based on revenue performance, capped at GBP4 million.
In the year ended November 20, Van Milder's pretax profit was GBP1.4 million and net revenue was GBP3.6 million, a 19% increase in both figures year-on-year. Van Milder's gross assets stood at GBP3.3 million.
Rightmove's pretax profit rose to GBP108.1 million in the six months to June 30 from GBP98.1 million the year before, with revenue up 10% at GBP143.9 million from GBP131.1 million.
This was attributed to stronger growth in average revenue per advertiser to GBP1,077 per month from GBP987, a rise of GBP90.
Membership numbers did fall to 20,209 from 20,454 at the end of 2018, however, "reflecting a 3% decline in mainly low-stock Agency branches offset by strong growth in New Homes development".
Overall, Rightmove is forecasting that the second half will continue to see growth in average revenue per customer as well as low-stock branches, which will keep development numbers stable. It expects to deliver on it annual expectations.
The company raised its interim dividend 12% to 2.8 pence per share from 2.5p per share.
Chief Executive Peter Brooks-Johnson said: "A 4.6% drop in transactions compared to 2018 has put pressure on some low-stock agency branches and created opportunity for others. We're focused on helping all our customers succeed by delivering the most significant and effective exposure for their properties and brands to compete to win home sale instructions and also by being the largest source of high quality leads. We've seen strong adoption of our new digital solutions and existing packages by new homes developers and agents as they recognise the value of the UK's largest property audience and Rightmove's unique data insight."
"We're looking forward to welcoming Van Mildert, a highly respected tenant referencing company, to the Rightmove family which will augment our Rightmove Tenant Passport in our quest to make renting a property faster, easier and more efficient for tenants, landlords, and agents alike."
Shares in Rightmove were down 1.1% at 506.00 pence on Friday morning.
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