Carsales on track after 27% HY profit lift

AAP

7th Feb 2018

Online vehicle classifieds business carsales.com has lifted its first-half profit 27 per cent and says it is on track to deliver growth in the second half.

The net profit of $60.2 million for the six months to December 31 – up from to $48.7 million for the same period a year ago – was driven by a strong performance from its core domestic divisions.

Revenue rose 12 per cent to $200.1 million, from $178.6 million in the prior corresponding period, while earnings before interest, tax, depreciation, and amortisation grew nine per cent to $90.6 million.

The revenue jump was largely driven by a solid performance in online advertising which grew nine per cent to $141.6 million, and the finance and related services segment which which rose 23 per cent to $32.1 million.

Data, research and services revenue also increased, by seven per cent to $20.6 million.

“This performance reflects a solid contribution from traditional advertising products, enhanced by continued strong growth in adjacent businesses and premium listing/depth products,” caresales.com said on Wednesday.

“Moreover, the business saw improved momentum in the second quarter, driven by both the release of new product enhancements as well as improved consumer sentiment.”

Chief executive Cameron McIntyre said the company was making “excellent progress” on advancing its international business, where revenue grew to $5.8 million, from $3.5 million in the prior corresponding period.

“We see significant long-term opportunity in all our international markets and we are excited to increase our exposure in Korea and Mexico by taking 100 per cent control of these businesses,” Mr McIntyre said.

Carsales.com completed the acquisition of the remaining 50.1 per cent stake of its Korean investment, SK Encar, in January.

Mr McIntyre expects the domestic adjacent businesses to continue to build scale and breadth in the second half of the financial year.

“The second half of FY18 has commenced well with January once again proving to be an attractive month for car buyers in the domestic business,” he said.

“We continue to closely monitor our performance and market conditions and, assuming these remain stable, we anticipate revenue, EBITDA and NPAT growth will remain solid in the domestic core business.”

CARSALES’ RESULTS AT A GLANCE:

* Profit up 27pct to $60.2m

* Revenue up 12pct to $200.1m

* Fully franked interim dividend of 20.5cps, up 1.8 cents

AAP SJZ/CDH/pt