Zoopla's share price rises as revenues hit a record high but acquisition costs hit profits

 
Shruti Tripathi Chopra
Follow Shruti
FBL-ENG-PR-WEST BROM-EVERTON
Zoopla enjoyed record traffic of over 314m visits to the company’s websites and apps (Source: Getty)

Zoopla's shares rose nearly five per cent this morning after the online house-hunting group revealed a jump in revenue in the six months to 31 March.

The figures

The FTSE 250 property firm's revenues rose 22 per cent to £117.9m in the period, up from £96.4m a year ago.

However, pre-tax profits slipped to £22.5m, down from £28.1m last year, due to acquisition-related costs and share-based payments.

Zoopla also enjoyed record traffic of over 314m visits to the company’s websites and apps with over 68 per cent of it coming via mobile.

The group's adjusted earnings before interest, tax, depreciation and amortisation (Ebitda) increased by 11 per cent to £45m while an interim dividend of 1.9p per share is to be paid to shareholders.

Why it's interesting

Zoopla began 2017 by acquiring data company Hometrack for £120m in January, a sign that the group's growth strategy is focused on acquisitions. Other businesses it has bought in the past include uSwitch, PrimeLocation, Hometrack and Property Software Group.

However, Zoopla boss Alex Chesterman is not upbeat about the property industry’s growth this year.

In an interview with City A.M. earlier this year, Chesterman said: “The Brexit vote has had an impact and that is not surprising given the resulting uncertainty.

“We saw property sales volumes fall quite significantly in the second half of last year, compared to the period before the vote,” he added.

Read more: How Brexit will affect UK house prices, according to Zoopla's boss

What Zoopla said

Alex Chesterman, founder and chief executive of ZPG said:

“Our property division has performed very well, driven by continued portal partner win-backs, strong demand for our up-sell products and the continued migration of our software partners to cloud-based products. The integration of Hometrack into the wider business is progressing well and, since the acquisition, we have signed new deals with TSB and Bank of Ireland and extended our relationship with HSBC, now serving 17 of the top 20 UK mortgage lenders.

We remain incredibly excited by the underlying growth across each of the business divisions, our recent acquisitions and the significant cross-sell opportunities to our highly engaged consumer audience and our unrivalled partner base.

Related articles