OnTheMarket showed more losses as it released its results for the six months to the end of July.
While revenue was up 14% on the same period last year, at £8m, it chalked up an operating loss of £7.2m, up from £5.7m.
Its costs also rose by 23% to £14.8m as it spent more on its sales and IT teams.
The business, which is backed by agents, still had cash in hand as at the end of July, but at £8.8m this was sharply down on the £15.7m that OTM held at the end of January. The cash balance was £8.6m at the end of September.
OTM also reported that the average branch numbers listed at the end of July were 12,434 – well up from the 7,788 at the same time last year.
The number stood at 12,622 at the end of September. OTM said that this figure reflected “the recruitment of new agents offset by the removal of agent branches following the expiry of free trial periods”.
Web and mobile visits were also up, by 75%, to 120.7m during the period.
In the results announced this morning, OTM said that as at July 31, 1,308 branches had been signed up under new paying contracts. The figure increased to 2,346 branches as at the end of last month, September. Of this number, 42% are under long-term contracts of three or five years paying an average of £331 per month.
Others are on cheaper, shorter-term contracts, paying an average £203 per month.
The portal had already said in a recent update on September 26 that due to market conditions, it has been slower than anticipated in converting agents to long-term, full-tariff contracts, and announced that it has introduced the shorter, cheaper contracts.
OTM also included in its results an update on the litigation with Connells brand Gascoigne Halman, saying that in July OTM received payment of a further £1.1m in respect of cost recovery. This more than offset the fees involved in the litigation, over the then ‘one other portal’ rule, and where OTM won the case.
Reporting on its property listings, OTM said the number stood at 641,672 as at September 30. It said that this represented around 64% of Rightmove’s inventory and 85% of Zoopla’s.
OTM said that between July 3 and September 30 its listings grew by around 90,000 while Zoopla’s fell by some 66,000.
OTM had earlier reduced its revenue and profit guidance for 2020 and 2021 and in today’s results CEO Ian Springett referred to this, saying: “Our results for the six months to 31 July 2019 were in line with our expectations.
“Our recent guidance indicated that agents had not committed to full-tariff, long-term paying contracts at the pace expected, however they have responded positively to the changes to our offering.
“We continue to convert agents to full-tariff, long-term contracts with share issuance: 42% of branches signed to new paying contracts since conversion began have been under these contracts.
“Following the share issuance arising from these contracts, over 3,000 agent firms operating over 6,000 UK agency branches will be OnTheMarket shareholders, increasing the strong core membership around which we are building OnTheMarket.
“Their backing for their portal in a variety of practical ways is key to creating an edge over our rivals in the portals market.
“We have recently supplemented our offering to agents with the introduction of lower-priced, short-term offers, with the aim of maximising the number of paying agents and migrating all to full-tariff contracts progressively.
“Take-up of these short-term offers has led to an encouraging acceleration in the rate at which agents are converting onto paying contracts.
“The continued strong growth in the operational performance of the OnTheMarket.com portal provides encouragement for the future. We have delivered another set of record-breaking traffic and leads results for our estate and letting agent shareholders and customers.
“I thank all my colleagues for all their hard work in driving OnTheMarket forward in pursuit of its objectives.”
Yesterday evening, OTM’s shares closed at 83.5p, some 1.8% down over the day.