Rightmove said this morning that it expects transaction levels to return to pre-pandemic levels this year, dispelling concerns about a slowdown driven by increasing inflation and a higher cost of living.
The company reports that operating profit for the year ended 31 December 2021 was £226.1m, up from £135.1m a year earlier, thanks in part to a boost in monthly Average Revenue Per Advertiser (ARPR), which was up 9% on 2019 to £1,189 per agent.
Performance relative to 2020 reflects the Covid customer discounts provided between April and October 2020, therefore comparisons to 2019 are also included.
Rightmove says revenue is up £15.6m, or 5%, on 2019, reflecting the growth in both customer spending and ARPA, partially offset by a decline in new homes revenues. Relative to 2020, revenues grew by 48%, as similarly strong product usage and package upgrades combined with an absence of 2020’s Covid customer discounts to drive strong revenue growth.
The operating profit of £226.1m, up 6% on £213m in 2019, and up 67% on on the level in 2020.
Underlying operating profit of £231m was recorded, up 5% on £219.7m in 2019 and 68% on the £137.5m achieved in 2020.
Basic earnings per share of 21.3p up 9% from 19.6p compared to 2019, and underlying earnings per share of 21.8p, up 7% from 20.3p. Compared to 2020, basic earnings per share up 69% compared with 12.6p in 2020 and underlying earnings per share up 70% compared 12.8p in 2020.
Final dividend for 2021 of 4.8p, up from 4.5p per ordinary share last year, taking the total dividend for 2021 to 7.8p.
Some £238.8m of cash was returned to shareholders through share buybacks and dividends in 2021. Again, this compares favourably for investors, with £148.5m returned in 2019, and £30.1m in 2020.
Cash, including money market deposits, at the end of the period of £48m was recorded, down from £96.7m in 2020, but up from £36.3m in 2019.
Financial highlights
|
|
2021 |
2020 |
2019 |
Change vs 2020 |
Change vs 2019 |
|
Revenue (£m) |
304.9 |
205.7 |
289.3 |
+48% |
+5% |
|
Operating profit (£m) |
226.1 |
135.1 |
213.7 |
+67% |
+6% |
|
Underlying operating profit(1) (£m) |
231.0 |
137.5 |
219.7 |
+68% |
+5% |
|
Final dividend (pence) |
4.8p |
4.5p |
nil |
7% |
– |
|
Basic earnings per share |
21.3 |
12.6 |
19.6 |
+69% |
+9% |
|
Underlying earnings per share(2) |
21.8 |
12.8 |
20.3 |
+70% |
+7% |
Operational highlights
Average Revenue Per Advertiser (ARPA) up 9% (£101) on 2019 to £1,189 per month (2019: £1,088; 2020: £778)
Relative to December 2019, Agency ARPA is up by £120, or 12%, driven primarily by product purchases, package upgrades and pricing actions
Strong uptake of Rightmove’s premium Optimiser 2020 package, with 21% of independent agents now subscribing, up from 9% in December 2020
Membership numbers are 1% down since the start of the year, at 18,969; with 16,110 (+188) Agency branches and 2,859 (-416) New Homes developments (31 December 2019: 16,347 and 3,462; 31 December 2020: 15,922 and 3,275)
Time on the Rightmove website averaged 1.5 billion minutes per month over the period, up from 13 billion in 2020 and 1 billion in 2020.
Site visits of 2.5 billion, compared with 2.1 billion in 2020 and 1.6 billion in 2019, up 56% from 2019 and up 19% from 2020.
Continued innovation with the launch of three additional digital marketing solutions and further progress in Rental and Mortgages as part of digitising more of the transaction.
Rightmove says its is committed to becoming a Net Zero business and has submitted fully verified near-term and net zero targets to the SBTi to achieve a significant reduction in emissions by 2030
Current trading and outlook
Rightmove’s network effects continue to position us at the heart of the UK property market and our financial performance in 2021 reflects the trust that our customers placed in our digital products to help their businesses to respond to the opportunities presented by the buoyant housing market.
As the market normalises, we expect the number of transactions to return to pre-pandemic levels. We remain alert to the macro environment, but Rightmove is not materially impacted by the property market cycle other than in the most extreme circumstances and we believe the UK online property advertising market will continue to grow.
We will maintain our disciplined cost management and focus on revenue growth, with costs in the historic range of 25%-27% of revenues.
The strength of our proposition, coupled with the innovation delivered during the past two years and the momentum generated during in 2021, underpins the Board’s confidence in Rightmove’s outlook for 2022 and beyond.
Peter Brooks-Johnson, chief executive officer, said: “Our position at the heart of Britain’s home-moving journeys strengthened even further in 2021, with people spending an incredible 18 billion minutes searching and researching for their new home. I’m proud of our role in helping more people than ever before find a home that meets their needs and helping our customers help sellers and landlords achieve the best price by having their properties marketed to by far the biggest home-moving audience in the UK.
“Our ambition to make home moving easier in the UK is undiminished and drives our everyday business and longer-term strategy, and I’m excited about our plans to use our industry leading platform to digitise more of the home-moving journey.”
A presentation for analysts will be available online from 7.15am at plc.rightmove.co.uk/investors/results-centre.
Comments (4)
OKAYYY…
I couldn’t let this pass without commenting. Some may remember it was a regular ritual of mine to compare YoY results from Rightmove and post them here on EYE. Haven’t done it for a while – it looks like February 2018 was the last post in that respect (how time flies!) – so I think now is a good time to dissect the PR puffery and crunch some telling numbers.
ADVERTISER NUMBERS:
Since I last reported (2017 figures) there has been a steady decline in advertisers. There has been a nett reduction of 1458 branches/developments – or 7.1%. NETT reduction. All those that said “50d this” and actually did something about it (plus of course all those that shut up shop for one reason or another) outweighed every bit of “new” business and the ‘SayNoToRightmovers’ who basically shouted “I’M OUT OF HERE!” and slammed the door on the way out – then crept straight back in through the side window – at a rate of SEVEN A WEEK over the four-year period. OUCH!
REVENUE PER ADVERTISER:
Since last report, the ARPA has increased by £267 or 29%. Of that, only 9% is attributable to the last 2 years. Could the gravy train be running out of steam?
REVENUE:
Revenue has increased by £61.6million from the 2017 figure – that’s 25.3%. in 2017 alone it increased by 11% – so slowing considerably.
UNDERLYING OPERATING PROFIT:
Has increased by £46.6million or 25.2%. In 2017 alone it increased by 11% – so the brakes have been firmly bound on since it would seem.
UNDERLYING OPERATING MARGIN:
Down from 75.8% in 2017 to 74% in 2021. Awwww… shame, innit.
Rightmove pretending on paper (or screen) that 2020 didn’t happen doesn’t make it reality. Comparing 2021 with 2019 basically shows the gulf was wide – but incredibly shallow.
Not that it makes any difference. Next year will be back to same old:same old – the yearly rinse and repeat.
But, as eggs is eggs, it won’t be Rightmove getting rinsed…
Whats going on, why no comments
Ha, I thought the same thing but then realised that people are just bored of it. The same news, the same huge rate hikes, the same massive profits. Rightmove simply answer to their shareholders and not their clients – those that pay their fees. It will not change, they will continue to raise the rates until their cost genuinely outstrips their value and they will see an exodus of agents.
How is that Say No to Rightmove campaign going?