Rightmove this morning announced a 10% rise in revenue along with an 7% increase in operating profits for the first half of the year, driven it says by “the resilient and growing customer demand for its products and services”.
The latest financial update from the property portal, issued this morning, reveals that revenue increased by 10%, from £16.8m to £179.5m, as more agents increased their use of the platform’s products and upgrades their subscription packages.
This was the the highest revenue growth in a first half period since 2018.
Estate agency investment in Rightmove packages and products resulted in agency revenue and average revenue per advertiser (ARPA) from this cohort both growing by 6%.
Agency ARPA increased by £79 to £1,341.
Here is the statement issued to investors a few minutes ago:
|
Financial Highlights
|
H1 2023 |
H1 2022 |
Change vs 2022 |
% Change vs 2022 |
|
Revenue |
£179.5m |
£162.7m |
£16.8m |
10% |
|
Operating profit |
£129.5m |
£121.3m |
£8.2m |
7% |
|
Underlying operating profit(1) |
£133.2m |
£122.4m |
£10.8m |
9% |
|
Interim dividend |
3.6p |
3.3p |
0.3p |
9% |
|
Basic earnings per share |
12.1p |
11.7p |
0.4p |
3% |
|
Underlying earnings per share(2) |
12.5p |
11.8p |
0.7p |
6% |
· Revenue up £16.8m/10% to £179.5m, as customers increased their use of our digital products and continued to upgrade their packages: the highest revenue growth in a first half period since 2018
· Operating profit of £129.5m, up 7% (2022: £121.3m)
· Underlying operating profit(1) of £133.2m, up 9% (2022: £122.4m)
· Basic earnings per share up 3% to 12.1p (2022: 11.7p); underlying earnings per share(2) up 6% to 12.5p (2022: 11.8p) – lower growth reflects the impact of the corporation tax increase in 2023
· Interim dividend up 9% to 3.6p per ordinary share (2022: 3.3p)
· £97.6m of returns to shareholders through share buybacks and dividends in the first half of 2023 (2022: £100.3m); 10 million shares (1.2% of outstanding share capital) cancelled in the first half of the year (2022: 9.8 million)
· Cash and cash equivalents, including money market deposits, of £43.2m (31 December 2022: £40.1m)
Operational highlights
· Average Revenue Per Advertiser (ARPA) up 9% to £1,411 per month (30 June 2022: £1,290)
· Highest New Homes ARPA growth in any reporting period to date, up £330 (23%), and strong Agency ARPA growth, up £79 (6%), both driven by increased product and package purchases and customer contract renewals
· Membership numbers stable: up 1%/102 since the start of the year at 19,116 (Dec 22: 19,014), with 16,093 Agency branches and 3,023 New Homes developments (31 December 2022: 15,932 and 3,082)
· Time on site averaged 1.4 billion(5) minutes per month over the period (2022: 1.5 billion), reflecting 2023’s slower property market; 27% above pre- pandemic levels (June 2019: 1.1 billion)
· Strong market share continues at 86%(5) (2022: 85%) as Rightmove remains the trusted site that home-hunters turn to first to search for properties and to inform themselves about the housing market
· Penetration of the top Estate Agency package, Optimiser, increased to 36% (Dec 22: 34%) and significant upgrades to the New Homes top package, Advanced, up to 49% (Dec 22: 42%)
· Continued product innovation, including: the launch of Joint Application Mortgages in Principle; Enquiry Manager – our qualification product for Lettings customers; and Track A Property for consumers
· Other business units, now representing 10% of revenues, have grown strongly, up 11%
· SBTi targets validated and renewed focus on green homes initiatives; the second edition of our annual Greener Homes report is published today.
Summary and Outlook
The strength and resilience of Rightmove’s business has remained apparent throughout the first half of 2023. Agents and developers have continued to use our products to win new mandates and to drive their businesses forward, and home-movers have continued to trust our sites to allow them to see the whole of the property market, helping them to make informed decisions. This has allowed us to deliver strong results, despite the backdrop of higher mortgage rates and the increased cost of living.
ARPA growth was strong in the first half: new homes developers used our Advanced Development Listing and Native Search Adverts products to market their developments, while our agent customers used products such as Featured Agent and Sold By Me to differentiate their brands on our sites to win new vendor mandates. As a result, first half ARPA growth has given us real momentum to deliver full year ARPA towards the top end of our previous guidance range of £95-£105.
Consumers turned to our Mortgage in Principle journey in increasing numbers during the first half to help them to understand their borrowing capacity and mortgage affordability, especially amidst the prevailing interest rate uncertainty. We expect this to continue in the second half and therefore for the revenues in this area of our business, which we earn in partnership with Nationwide, to increase on 2022’s revenues. We expect the remaining Other business units to continue to perform in line with first-half performance and to maintain their year on year growth for the full year.
Disciplined cost management remains a key feature of our business model. Underlying operating margin for the reporting period was 74%. We expect costs to be slightly higher in the second half, as is the usual weighting across the year, and expect a full year operating margin of 73%, in line with previous guidance.
Our performance in the year to date, the clear value of our products to customers and consumers alike, and the outlook for the second half, mean the Board is confident that the Group will deliver in line with its previous expectations for the full year.
As we look further out, it is clear there are significant opportunities available across all our business units. To maximise our ability to take advantage of these opportunities, we will modestly increase our investment in the business to drive organic growth, while maintaining an underlying profit margin of 70 – 72%. We expect this investment to result in double digit revenue and profit growth in the medium term and beyond.
We will host an Investor Day at our London offices on Monday 27 November 2023, where we will set out our strategy for medium term investment to accelerate growth. Further details will be issued closer to the date.
Johan Svanstrom, Chief Executive Officer, said: “This has been another period of strong financial and strategic progress for Rightmove. These results clearly illustrate that Rightmove continues to be the property portal that consumers turn to first and engage with the most, and that our customers continue to use our innovative products and services to support their businesses in both slower and faster housing markets. Our performance against the backdrop of a challenging interest rate environment demonstrates yet again that Rightmove isn’t materially impacted by the property cycle.
“I have been very impressed by what I have seen in my first five months as Rightmove’s CEO and would like to extend my thanks to the team for delivering so strongly. This is a business which has performed consistently well over an extended time-period, and I am excited by the growth opportunities that I see over the long term in the wider UK property market. From here, our aim is to expand our platform, our products and our data, for both customers and consumers, to further digitise the sector, both in our core business and in newer growth areas. We also want to play an active role in facilitating the much-needed green transition of the real estate market, leveraging our vast pool of data and insight to do so.”
Rightmove defends 17% fee hikes as estate agent says ‘no option’ but to pay
…yesterday, Utilities, today, Rightmove.
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“driven by the resilient and growing customer demand for its products and services”
That was a joke… right?
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Fantastic result!
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House prices have risen, fuel prices have risen, cost of living has risen: all generating national headlines.
And then there’s Rightmove. An annual shafting delivered to their customers through thick and thin and who simply roll over and take if with a modest moan each year.
Anyone dare to quantify the percentage increase for each of these over the last 10, 15 or 30 years ?
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In 2006, Rightmove earned on average £183 per estate agency office per month, today its £1,411 per month
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I was conflicted, I wanted to dislike the content but appreciated the fact that it was provided.
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Rightmove annual price increase and record profits, in other news water is wet.
Stop complaining and do something about it!
The same people moaning are the same people who spent £600 a week to advertise in the paper in 2004.
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Agreed Wevegotbuyers39 – here is something interesting to add to your post ….. £600 in today’s money is £1,030.66
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but what are you meant to do. lets be honest, you need to be on Rightmove. not to sell properties necessarily, but on a seller perspective to gain instructions. without Rightmove people will just instruct an agent who is on Rightmove
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What a load of rubbish, if you actually believe that then you are clearly Brainwashed and have no business acumen.
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i would say the same to you. as a seller, if i went to look for property, which 100% of buyers and sellers use Rightmove, and i saw one agent all over the portal and another no where to be seen. Why would i then go with the agent that isnt on Rightmove?
until buyers habits change and go away from Rightmove…. or the majority of agents come off Rightmove… you have to be on it. Rightmove know this and thats why they have everyone over a barrel
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Thats your assumption, buyers and sellers look everywhere for property the main site is Google.
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and thats your assumption. in my 13 years experience i can think of a small handful that have said they have googled properties for sale.
you still need to advertise them somewhere and if you are doing it just on your website then you wont get anywhere near as much traffic as Rightmove. especially in bigger towns with a high volume of agents. our average fee is over £6,500 so paying Rightmove £1,400 a month isnt a huge amount.
coming off rightmove and loosing just one instruction a month wouldn’t be beneficial
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13 years experience says it all, so what your saying is Rightmove own you? and you cant leave and have no idea how to run an estate agency.
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sounds like you dont know how to run a business. if your average fee is say £6,500 and your net is £100k each month. Rightmove costs £1,400 a month but yet by coming off Rightmove you save £1,400 a month but loose just one instruction but being the only agent in your town of 20 not being on it. Then you are worse off by £5,100.
Just by seeing the benefit of Rightmove is a very important tool, along with many other tools, it doesnt mean rightmove own you.
What is your magical and alternative option then my business person of the year.
I do think there must be a better commercial option other than Rightmove but as things stand it makes no sense just the odd agent leaving here and there.
its not necessarily about selling properties as there are many ways to do that, but instructions. and again, not all instructions are from Rightmove, but that presence on Rightmove is vital. Rightmove is by far the leading way that people buy property.
The problem with Rightmove is that they increase prices so much so quickly, not that it isn’t a good portal. and in comparison to staff wages, premises rent and everything else, it is still a small percentage of outgoings for each office but a vital tool (along with many others). The issue everyone has with Rightmove is them putting the prices up and it not being controlled
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rubbish
I am not an agent I speak as a buyer
they do not look on google
I never have never will
When I am looking to buy my only port of call is RM
Until someone challenges RM does RM will be the go to site
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One for the competitions authority ?
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In October 2011 when it was announced the DMGT trust portals might be passed to Alex Chesterman I posted that would create a duopoly that would increase the Rightmove subscription to £1000- ZPG and DMGT referred themselves to CMA who authorised the merger.
(I tried to stop the merger by pointing out to DMGT executives the opportunity they were passing up)
Everything I predicted in a post on EAT in Octover 2011 has played out as I said it would. The personal fortunes have been made, Trust assets have been stripped and I even proved that if anyone built a system that challenged Rightmove it would not be allowed to flourish.
Too many people who service agents and advise agents have a very shallow understanding of professional agency; their business, their service, their domain knowledge and reputation is dependent on Rightmove so don’t expect anything to change very soon.
It’s your service suppliers who are keeping things as they are
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Agents need to either:
a) Respect and accept that Rightmove have a good business model, even though they are profiteering.
or
b) Stop complaining and do something about it. I’ve created a 100% agent-owned property portal which agents can list on for free by completing a quick form. I’m not sure there is any other alternative?
Rightmove won’t be scared by 10,000 agents joining a mailing list (Say No To Rightmove).
Rightmove won’t be scared by 10,000 agents joining a Facebook group.
But would Rightmove be scared by 10,000 agents joining their own portal? If nothing else, it would potentially provide agents with leverage to negotiate.
Agents need to work together on this….
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I thought that was the whole idea of On The Market
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Would have been better buying Purplebricks and turning that into a portal…..
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That was the ‘original’ intention of On The Market, but then they demutualised. It’s now majority-agent owned, but for how long?
“Would have been better buying Purplebricks and turning that into a portal…..”
Who would have bought it? It would have needed to be agent-owned, so who would have rounded up agents to fund it? Who would have redeveloped it, and implemented a mechanism for all agents to import their properties from various CRMs? Who would have paid for that development? How would you have changed a tarnished brand to represent an industry?
There are a million other questions too.
What I have provided is an example that works (in basic terms). That hasn’t cost any agent a penny. That is ready to be 100% owned by agents. But just needs agent support (in high numbers).
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I’m a traditional high street agent but last week I heard a lady moaning about she couldn’t find a property despite searching RM, Zoopla and PB….seriously I think you’ll find a lot of people actually think its a portal rather than an agent, I’ve had people say similar things on vals, any way it was only an idea, no matter how laughable.
I think I would get Ian Springett to run it as he made such good effort with On The Market
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Leave the Mafia behind. I did in January and my bottom line is SO much better…
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In 2006 the average agent was paying £250 per week on newspaper advertising… which is £1727 per month in today’s money
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It’s so funny that some agents are actually trying to justify their decision to keep using Rightmove.
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working in a town with over 20 agents, all on Rightmove. How do you think 1 lone agent would fair being the only one off Rightmove. yes, you may save £1,400 a month, but when the average fee for our office is just over £6k, loosing one instruction off the back of it would be hugely detrimental.
i agree that not all properties sell from Rightmove of course, but we all know, instructions breed instructions and without buyers and sellers seeing what you are doing then they won’t.
either buyers habits need to change, or the majority of agents come off Rightmove in one go.
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You are so right local agent. My West Country firm left RM 2 years ago. We are in a town of 20 firms, all on RM – clients left us and new instructions dropped like a stone. We rejoined and it was business as usual. ‘Hitman’ hasn’t a clue and is talking absolute rubbish. Unless it’s one out, all out, forget about leaving, it’s commercial suicide.
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that’s really interesting to hear. I do think there must be a better commercial option other than Rightmove but as things stand it makes no sense just the off agent leaving hear and there.
its not necessarily about selling properties as there are many ways to do that, but instructions. and again, not all instructions are from Rightmove, but that presence is vital.
The problem with Rightmove is that they increase prices so much so quickly, not that it isn’t a good portal. and in comparison to staff wages, premises rent and everything else, it is still a small percentage of outgoings for each office but a vital tool (along with many others). The issue everyone has with Rightmove is them putting the prices up and it not being controlled
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Agents who can’t conduct their business without Rightmove must have little or no experience.
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agents who are so blinkered to thinking Rightmove doesn’t help business is deluded.
Everyone knows there are issues with Rightmove and they over charge etc. But while there are no alternative portals that have the buyer and seller presence that they do, it is still beneficial to be on Rightmove.
Maybe if you have a very small company and it is your main expense, it may not make sense. But an office bringing in £100k net a month, £1,400 is a drop in the ocean in comparison
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What is the name of your agency let them see how many instructions you have?
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My 40 years experience confirms that Hitman is either having a laugh or, far more likely, hasn’t a clue!
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couldn’t agree more. even with 2/3 years experience you can work it out. unless if you’re a tiny village with one or two agents doing low numbers… which most arent
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Rightmove haven’t been around for 40 years I’m sure with that long experience you could operate a business without them unless you really are brainwashed.
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times change hitman, seems like you need to move away from the 1980’s. as i stated, all the time that the majority of agents use Rightmove and buyer and sellers habits are to use Rightmove then being a lone wolf and coming off is not going to be financially beneficial in any way
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You may be mistaken in to thinking buyers and sellers habits I’d be interested to see some evidence.
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are you even an estate agent? to think buyers and sellers don’t use Rightmove? very odd!
the fact that Rightmove gets between 65-100m views a month (the highest in 2020 being 152m) would suggest that you are unbelievably unaware what your market audience are doing!
for reference, zoopla visitors to the website are between 25-34m a month.
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I expect you don’t know the figures for your area, which would suggest you are believing your own hype.
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the 15 rightmove leads we have had today will say Rightmove is an important tool.
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It maybe important for you but what happens when you are the only one left on there because the others have discovered the real world. Im happy not using them its made my business better, you look like you need them.
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i imagine 90% of agents are on Rightmove, there is a reason for that. i agree when the majority leave then it makes sense. but not when its a minority leaving. it does depend on location and how busy your town is, but for the average agent in a town of multiple agents, you’ll be eaten alive without having that exposure. and for successful business, £1,400 a month for Rightmove is nothing. maybe you’re just a little one man band happy to be making peanuts
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I probably make more than you with less hassle and less overheads. But hey ho I get where you are coming from when you have a beast to feed you have to find food.
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Reading some of the commissions earned on here, I think rightmove have plenty of price increases to come.
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This is the summer version of Rightmove are greedy b*stards. The next instalment is in Jamuary when they raise their prices again.
It gives the agents two chances to have a whinge while they open their wallets to be fleeced.
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I’d hate to be scared of leaving Rightmove because of my competitors.
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i’d be scared having you running my company not knowing what my audience are using. regardless of what the competition are doing, i would be more focused on my buyers habits.
as a seller, if you weren’t on Rightmove, i would be looking elsewhere
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Never had a problem selling or listing, clients actually know that we sell properties not Rightmove.
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What is the name of your company then
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No-one likes a know it all but I don’t think anyone can say I didn’t predict all that is happening right now as early as October 2011.
The solution I built, tested and proved, does what it says on the can- it’s now owned by a firm that’s considerably bigger and globally influential than Rightmove.
“Build it and they will come” (credit Peebee 2015) not if they service suppliers, connectors and influencers can stop them!
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“it’s now owned by a firm that’s considerably bigger and globally influential than Rightmove.” – Is that a good thing, Robert?
Does the industry really need 4 big players in the portal space, all monetising their data?
Does the consumer really need to search 4 portals to find a home?
Will it do anything to reduce the astronomical fees that agents already pay?
I’m interested in your opinion. I’ll be honest – the Find Properties portal that I’ve created is a 100% agent-owned proposition, but agents haven’t exactly flocked to it even though it’s free and owned by them! So I’m really not sure what agents want anymore other than to complain on forums and social media about Rightmove fees and profits?
What’s happened to the R4P link btw? Is it being rebranded?
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It’s a very good thing, because of what was built and how it works it is different to a portal .
Someone needs to challenge Rightmove and that won’t ever be their Duopoly partner and it will be a while before OTM grows organically enough to mount a serious challenge. Jason is doing a great job but the staircase to success is slow and steady
From 2018 I tried agent owned but realistically the idea of a co-operative system doesn’t gel. The competitiveness that exists #locally gets in the way.
Agents want a service and results
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Leaving RM for many in a hard stop isn’t possible , contractual obligations and the lack of an alternative strategy for starters . However if you don’t like the way RM profiteer at your expense you can start to plan and slowly wean yourself off RM . RM disrupted the news papers and agents have an opportunity and ability to disrupt RM .
Look at Your P&L and cash flow predictions RM will be taking out more from your business than a lot of agents will in the next 12 months .
They won’t stop if you don’t stop them !!
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Iain White you are correct….As long as agents allow themselves to be bullied by Rightmove they will continue to bully them, the fees will continue to rise until a time when the dam bursts and then the game changes, ‘should they make staff redundant or leave RM’ which is the biggest outlay? What’s more important? and if they do nothing about it then nothing will change for them, RM have bred hostility amongst agents and many agents can’t see past the barn door, here is a small reminder – Day Light Robbery, Blackmail and Shafted are words that come to mind, the only alternative is for agents to promote and work with a genuine Agent friends such as OnTheMarket who have united their member agents, they can be forgiven for the Ian Springett days that’s all in the past, it’s so different now so many things have changed the CEO Jason Tebb is an Ex-Estate Agent who understands the business side and listens to agents. I would encourage anyone to join OTM and participate in the Town Hall meetings. Plan a RM exit strategy speak with agents that have and are doing it right now, if you fail to plan you plan to fail. You own Rightmove nothing they will continue to pull your pants down, ‘If you allow them to”.
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This is the 3rd time I have \asked the name of your company
If you are doing so well why is it a secret?
As a developer I would never use an agent who is not on RM for the simple reason that is where most buyers look.
If your web site show a load of listings and sold properties I could be persuaded but your hysterical ranting make me believe you are just a troll
If you are doing so well surely to let others see that would prove your point
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Your statement makes you sound foolish and sad, by only looking on RM means you are missing out on thousands of potential deals, your tone and expressions explains it all calling people out and accusing them of being a troll means you’ve lost your argument, when the debate is lost slander becomes the tool of a loser, I expect you have very few or no friends.
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