6th May 2008 12:10
Rightmove Plc06 May 2008 6 MAY 2008 RIGHTMOVE PLC INTERIM MANAGEMENT STATEMENT Rightmove plc ("Rightmove"), the UK's number one property website, at the startof the Annual General Meeting today, publishes its Interim Management Statementfor the period from 1 January 2008 to 5 May 2008 with management and financialinformation relating to the period 1 January 2008 to 31 March 2008. Current trading: Overview Rightmove has continued to trade strongly since the start of the year, withcontinuing growth in advertiser numbers, traffic and revenues. The number of advertisers on the Rightmove site grew to over 19,500, up 15% on ayear ago and up 2% since the start of the year. Activity on the website is up 22% compared to the same period a year ago toaround 550m page impressions per month. During April 2008, we entered into a bilateral facility of up to £40m with theBank of Scotland for the specific purpose of facilitating share buy-backs.Rightmove continued to repurchase its own shares with a total of 3.93m sharesbought back, as at the end of April, at an average price of 467p and a totalcost of £18.5m. Estate agency A rise in the basic subscription price from £250 to £325 per office per monthwas successfully implemented on 1st January. Membership numbers among estateagents at the end of March were broadly unchanged from the year end, despite anincrease in the number of estate agency branch closures and any leavers as aresult of price rises. This was as a result of continued strong new joinernumbers particularly in Scotland and Northern England where Rightmove'spenetration is below the 90% average. The retention rate for estate agents hasdeclined to around 85%, compared to 92% in 2007, as a result of an increase inagents ceasing trading. We anticipate that the number of branches closing oragents ceasing trading in the second quarter will be higher than in the firstand is unlikely to be outweighed by new joiners. New homes The number of new homes developments on the website has increased byapproximately 150 since the start of the year bringing the total to 3,950. In atougher housing market environment, with properties taking longer to sell, theaverage time that each development remains on the Rightmove website haslengthened. In addition to a significant price rise in January, over 200developers representing over 700 developments switched from monthly to 12 monthcontracts, leaving fewer than 1,000 developments under short-term contracts. Lettings agents Lettings agents advertising on Rightmove have increased in the region of 6% toaround 2,500 since the end of 2007, giving a penetration rate at the end ofMarch of approximately 83%. Some of the estate agents who have ceased tradingcontinue to be Rightmove customers as they have reverted to being predominantlylettings agents. Product development The Group continues to invest in product development. A new range of RightmoveChoice products was introduced in January 2008. Sales of both the original andnew Rightmove Choice products have been healthy as agents look to switch theiradvertising spend from newspapers and print titles to more effective onlineplatforms. An area of particular strength has been the growth in the emailcampaign service which allows advertisers to target specific home buyers whohave registered an interest in a type of property. Holiday Lettings Holiday Lettings, in which Rightmove has a 66.7% interest, traded strongly inthe crucial first quarter and is on track to record substantial revenue growthin the year. Outlook The outlook for the UK property market is very poor with recent announcements onmortgage approvals and from new home developers showing the scale of theslowdown. The competitive environment suggests that Rightmove is gaining significantmarket share of property advertising as a result of declining spend on regionalnewspapers and little change in terms of the relative position of other propertywebsites. We anticipate substantial declines in property advertising in regionalnewspapers. While we believe that up to 5% of this is attributable to agentsgoing out of business, we believe that the majority will reflect reducedspending by businesses which continue to trade. These businesses continue to beRightmove members and in many cases are reinvesting some of the savings they aremaking elsewhere in their business in Rightmove services. If housing market problems result in a decline in the number of estate agentsover a protracted period, together with a decline in the number of newdevelopments commenced and a switch among small developers to the use of estateagents, then there will be an adverse impact on the Rightmove business. Even reflecting a weak outlook for the UK housing market and for propertyadvertising generally, the Board has confidence in meeting market expectationsfor the current year. Contact: Neil Bennett or Charlotte Walsh, Maitland +44 20 7379 5151 This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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