Zoopla this morning announced a ‘transformational’ year with record revenue and profits.
The company also said that it had showed “continuous agency growth since May” and is confident of delivering further growth.
However, its report also refers to a big drop in agency members – standing at 12,702 at the end of September, down from 16,373 a year earlier.
Revenue from UK agents was also hit, standing at £58.3m, down 7% from £63m the previous year.
Zoopla also said it was charging 11% more per agent advertiser, although revealing that both leads and listings had dropped.
In its results for the year to September 30, it announced a 34% rise in revenue to £107.6m and a 20% rise in profits to £25.4m.
Zoopla bought price comparison business uSwitch in June for £160m. Adjusted EBITDA, earnings after costs, was up 23% to £48.7m. Zoopla said EBITDA had increased following the acquisition.
In this morning’s report, Zoopla said that its property services division “has exhibited robust performance, despite the reduction in the number of UK agency partners following the launch of a new portal operated by Agents’ Mutual at the start of calendar year 2015.
“Agents’ Mutual operates a restrictive practice preventing its members from advertising on more than one of the other more established property portals.”
Zoopla said that traffic to its property platform remained strong, up 4% to 44.7m average monthly visits. However, leads generated for agents were 25.2m during the period, down from 29.2m a year ago. Zoopla said that was down to the group focusing “on the quality of leads and helping its partners win new business.
“The total number of property leads compared to the previous year was impacted by the reduction in UK agency partners and corresponding inventory available.”
The report goes on: “The number of listings featured on the group’s property platform fluctuated throughout the period as a result of the reduction in the number of UK agency partners and teh general shortage of supply in the market.
“As at 30 September 2015, the group had 845,000 property listings advertised (2014: 1.1m).”
CEO Alex Chesterman said: “We have made great progress towards our vision of becoming the consumer champion at the heart of the home with the acquisition of uSwitch, the leading home services comparison platform in the UK.”
He said that the results demonstrated “the Group‘s exceptional value proposition as one of the most cost- effective digital marketing channels for property professionals. Traffic to our property platform remained strong with high levels of user engagement and we recently passed the significant milestone of over seven million downloads of our property apps”.
He said that the comparison services division of Zoopla “outperformed expectations” in the four months since the purchase of uSwitch.
Under a section about principal risks and uncertainties, Zoopla says: “While Agents’ Mutual continues to operate its restrictive advertising provision there is a risk that certain estate agent partners cannot, or choose not to, list on the group’s property services websites”.
Reacting this morning, City analyst William Packer of Exane said that Zoopla’s outlook “as usual is confident”. However, he added that traffic and lead trends are “weak”, reflecting the “continued sizeable loss of inventory”.
However, he said that overall, the numbers announced by Zoopla this morning were “a small positive”, adding “but we expect Agents’ Mutual to remain a significant drag (traffic, inventory, membership, etc.)
“In contrast we expect Rightmove to benefit from increased traffic share and a unique inventory advantage.”
A second analyst, Anthony Codling of Jefferies – the bank which advised Zoopla on its stockmarket flotation last year – said: “Zoopla is leading rather than following the market as it seeks to be the one-stop shop for the home buyer, the Amazon of UK residential, with services ranging across property to tradesmen to utilities.
“In our view, two catalysts are likely to lead to a material re-rating of Zoopla’s shares in the coming months: challenger portal OnTheMarket failing to live up to its own hype of being the UK’s number two portal by January 2016, leading to customers returning to Zoopla, and uSwitch continuing to perform ahead of expectations.”
Basically what I’m reading here is that OTM has all but finished off Zoopla (I’m sure GPL would have said it at some point today) but with operation shotgun to own foot or agents mutual as it’s otherwise known I can expect a big clunky letter from Rightmove explaining my new “pricing options” …thanks everyone
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What? 7.55am and not a single comment from the anti OTM faction? Come on, let’s be having you.
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Rather than try and stir up an argument with what you call the anti OTM faction, would in not be far more productive to discuss with your fellow pro OTM faction what you are going to do about it?
They don’t look bad figures to me and according to your man, you are meant to be toppling this lot next month.
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It wasn’t to stir it up. The comment was ironic. Look it up.
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Looks like I did! Apologies for misreading your comment AI.
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Agency insider isn’t AM.
They are brilliant figures unless you are one of the innocents who are generating that cash for Zoopla and not aware how. If their man had his finger on the pulse he would be using these numbers as a very compelling recruitment campaign.
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Ah, hello danny. You just got in under the wire 🙂
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Forgive me while I present this as I read it;
“Revenue from UK agents was £58.3m, down 7% from £63m the previous year.
Despite charging 11% more per agent advertiser and revealing that both leads and listings had dropped.
However its results for the year to September 30, showed a 34% rise in revenue to £107.6m and a 20% rise in profits to £25.4m”
In other words Zoopla earned about £49.3 million from new revenue streams. What someone has to do is now work out how that is being done, how it is possible and then to use what they find out to their own advantage.
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Off to meet the chaps at my Mayfair club this morning.
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Like I said yesterday, can Eye please do something to curb personal attacks that have absolutely nothing for this publication or forum.
Whichever side of the fence you stand, surely everyone agrees that this type of comment is out of order?
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Wilko. That is a very reasonable request but one which is immensely difficult to deal with. Where does ’emphatic’ or ‘passionate’ spill over into ‘rude’ or ‘too personal’? How can we know the various readers’ differing levels of sensitivity to comments? When is a comment sarcastic or ironic and when is it insulting? Our policy is, and will remain, to allow as much free speech as possible within the bounds of the law. In our experience those who may be viewed as overstepping the mark are pretty quickly brought to book by other readers, and those who persist simply show themselves up for what they are.
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His name is Iain Springerrr and he’s off to his Mayfair club, what’s the issue Wilko?
Just a random letting us know what he is upto today.
Unless of course you believe it is some sort of parody account, in which case you should probably ask first before assuming
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Come on Wilko, a bit of satire is funny, not really hurting the bloke. made me chuckle.
Far worse is said, a number of them are in the pro camp as well.
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Well, I did put a question mark after my comment, and have received answers.
Like I said, very very sad that people seem to think that there is, actually, a place for these sorts of personal digs that have nothing to do with the stories whatsoever.
Nick, you say ” Where does ’emphatic’ or ‘passionate’ spill over into ‘rude’ or ‘too personal’? “….
In my view this comment is both personal and rude, and totally un necessary.
But like you say Nick, it is down to different levels of sensitivity and I’ll watch from the side lines to see where you eventually draw the line.
And to all those that continually use this publication to personally knock the management of OTM…….you have been given the green light to continue these comments or even maybe take them to the next level.
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So, commenting on the story;
Z are…” charging 11% more per agent advertiser”……..As expected,the shortfall created by those that left Z,(who likely won’t return), is being paid for by those that were loyal and stayed.
Seems a very fair business model?
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Whilst you may come up with some valid reasons why you should be OTM and not Z Wilko, the last route you want to be heading down is cost. I can only speak for myself, but I would suspect Z charge me not much more than half of what you are paying OTM.
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I never mentioned OTM?
I was simply stating that I believed the shortfall of Z membership was being funded all, or in part, by straight membership increases from those that stayed.
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OK enough of the property portal BS as a paid up advertiser on two of these websites I want to see some serious advertising starting 26th December on all TV stations (except Dave cos only blokes watch that and blokes don’t buy houses, as we all know!)
If OTM out advertise Z then they will get more agents signing up if not status quo or Pink Floyd ?
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“status quo or Pink Floyd ?”……Which line ups/what era?
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PurpleBricks have allegedly raised £50m at £230m valuation
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Yeh right ! Just look at what the stock market boys think of Z’s results today. Well down rather than well done. And, yes, RM’s upwardly mobile share price keeps a-marching on….
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Tristramboris,
PurpleBricks are following the classic ‘first adopter’ strategy of bringing in huge investment so that they, and their investors, can hopefully smother all other potential competitors with massive continual advertising and emerge as the national brand name market leader.
During the expansion and establishment period very few of these first adopters turn a profit, nor do investors expect them to, which means that valuing the business pro rata to investor shareholding is not relevant.
Amazon, Ebay, Facebook and Google are the definitive examples of the strategy PurpleBricks is following but there are many more less well known examples. None of the aforementioned companies turned a profit for years.
Those EA’s laughing at PurpleBricks and their investors will end up the laughing stock.
I’ve repeated on here for nigh on 18 months that the only reason why onliners had just a 2% market share was not because buyers don’t want their service but because so few knew the service existed.
PurpleBricks especially, HouseSimple and Emoov with their TV advertising are accelerating awareness of OEA’s at an exponential rate and any traditional EA who believes this will all fizzle out is either sticking their head in the sand or showing a huge lack of business acumen.
Whilst there will always be a role for traditional high street agents, of which I am one, the real sea change that public awareness of OEA’s will bring will be in attitude towards sale fees.
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Hi Haree – I agree, and if you are the early adopter that wins out, you have a big advantage in the market place.
But what about all the OEA’s who have got loss making models that don’t emerge as the de-facto name for cheap online?
They are left with no winners and loses for the investors and crowd funders.
There is ebay and no number 2 ebay…
Lots of OEA will go pop.
As it stands, Purple Bricks look to be in the box seat to get their float prize, time will tell how their money and marketing turns into profit in the years to come.
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Continued…
OEA’s will turn the focus on fees from the traditional % to ££££’s paid.
More and more, sellers will ask “but how much will I actually pay” and compare that to the fees that they have seen on TV.
Any traditional agent who fails to see that will bring downward pressure on their sales fees, irrespective of the local service offered, is again in my opinion deluding themselves.
Add in the fact that the Government intend to encourage OEA’s and we truly are at the start of massive changes in our industry.
There will inevitably be massive successes … and massive failures to.
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