REG-Rightmove Plc: Trading Statement

RightmoveAnnouncement

10/05/2024 07:15

10 May 2024

Rightmove plc

 

Rightmove plc

 

AGM Update

 

Strong Start to 2024; Reiterating Full Year Revenue and Margin Guidance

Updating ARPA Guidance to Reflect Increased Customer Numbers

 

 

AGM update

 

In advance of its Annual General Meeting today, Rightmove plc, the UK's number
one property portal, provides the following update on trading for the period
from 1 January 2024.  Unless otherwise stated, figures relate to the
four-month period ending 30 April 2024. 

 

Our expectations for revenue and profit for the full year are unchanged.

 

Market update

 

Our most recent monthly House Price Index 1  (#_ftn1) reported the average
asking price for properties coming to market increasing by 1.1%
month-on-month, with annual house price growth of 1.7%, the highest for 12
months. 

 

Sales agreed between January and April 2024 are 17% higher than the same
period last year, with both sellers and buyers now increasingly looking to
transact, and we continue to anticipate total sales transactions of 1.1
million in 2024.  Higher mortgage rates continue to stretch affordability for
the average buyer, and the market is operating at different speeds across its
many segments and areas.  Completion times remain lengthy, with an average of
five months between an offer being accepted and completion. 

 

According to our latest Rental Tracker 2  (#_ftn2), the rental market remains
very busy, with an estimated 50,000 properties needed to return the supply of
rental properties to pre-pandemic levels.  With an 18% increase in listings
availability in the first four months of 2024 compared to the same period in
2023, rental agents received an average of 14 leads per available property,
and average rents were 7.6% higher than the same period in 2023.

 

 

Trading update

 

Audience update

 

Rightmove remains the place to which consumers turn first - they continue to
choose Rightmove for over 80% of all consumer time spent on UK property
portals 3  (#_ftn3).  Our consumers are also highly engaged - over 8 million
users are opted into our marketing, we sent over 19 million leads to agent
partners, and we delivered over 40% of email leads through our app in the
period. 

 

Customer update

 

Within Estate Agency, net membership increased by c.250 since the 2023
year-end, due to strong agent retention and particular strength in the
lettings market (c.170 net growth in lettings-only branch count and rental
operators).  Our digital end-to-end solution, Lead to Keys, attracted over 70
new partners to Rightmove and over 170 existing partners added the product to
their subscription. Independent agent subscriptions to Optimiser Edge now
exceed 700, ahead of our expectations when setting the plan for 2024.  Our
current expectation is that agent branches will increase by up to 2% during
2024 relative to 2023, ahead of our expectations earlier in the year.  

 

The increase in membership numbers is positive for revenue and profit and
provides increased consumer choice on the Rightmove site. Lettings-only agents
typically have a lower ARPA, particularly those with relatively low stock.  

 

New Homes has seen over 90 new developments added to our new, entry-level
Access package, which is tailored specifically to housing associations.  As
with lettings-only agency branches, the additional developments are positive
for revenue, profit and consumer choice; housing association ARPA is lower
than for mainstream new homes developments.  Based on the overall market
context for developers, we expect the total number of developments for 2024 to
remain relatively flat on 2023. 

 

ARPA growth, excluding the recent change in customer mix, would be in line
with our previous guidance of +£100-110.  There has been no change to
Rightmove's longstanding approach to contract renewals and pricing, and our
usual discussions in the period have proceeded as expected. 

 

Guidance update

 

As a result of the combined impact of the above, we now expect a different mix
of ARPA and customer numbers from that anticipated at the start of the year. 
We therefore update guidance for 2024 as follows:

 
* Full year revenue guidance unchanged, at +7-9% on 2023
* Full year underlying operating margin guidance unchanged, at 70%
* Customer numbers expected to grow by up to +2% on 2023, versus previous
guidance of a slight decrease
* ARPA growth updated to +£75-£85 on 2023's £1,431, reflecting the change
in customer mix, as outlined above
 

Other updates

 

Alongside Lloyds Banking Group, Nationwide and NatWest, we were pleased to
invest in Coadjute, a platform which aims to digitise the home-moving process
and to make it more efficient for consumers, agents and the wider industry. We
acquired HomeViews, the UK's biggest community of verified resident reviews of
property developments, to enable our strategic opportunities within the Rental
Operator sector.

 

Our Strategic Growth Areas of Mortgages, Commercial, and Rental Services are
all performing in line with our expectations.  Within Mortgages, we have had
a positive start to the year, with strong consumer interest and machine
learning-led optimisation improving the mortgage journey for consumers and
improved outcomes for our partners.  Our Commercial re-platforming continues
at pace, with a new landing page expected later this year.  As set out above,
Rental Services continues to see strong uptake from lettings agents, and our
new Lettings customers will also build a pipeline for Rental Services going
forward.

 

We remain focused on building success with our agent and developer partners,
providing real-time, tailored, digital solutions based on the largest UK
property datasets to help them to build their businesses; free resources,
training and CELA qualification preparation for all members; and resolute
focus on high-quality leads, which remain many multiples ahead of our
competition.

 

Johan Svanstrom, CEO, said:

 

"Overall, we continue to expect a better year for the UK property market in
2024 than in 2023.  Within that, we see different dynamics across the many
segments that we serve, with particular strength in resales.  We are pleased
to see our existing and new partners recognising the value that we can deliver
together.  We have a growing, innovative portfolio of digital services,
exemplified by strong take-up of Optimiser Edge and an increase in lettings
branches and affordable new homes developments.  We remain confident in
achieving a year of good financial and strategic progress and are focused on
driving further long-term platform growth."

 

 

Enquiries:   

Investor Relations Investor.Relations@rightmove.co.uk

Powerscourt  rightmove@powerscourt-group.com

 

About Rightmove
* Rightmove has the UK's largest selection of properties for sale and to rent,
adds more listings than anyone else, and over 80% of all time spent on
property portals is on Rightmove.
* Rightmove's vision is to give everyone the belief that they can make their
move by giving people the best place to turn and return to for access to tools
and expertise to make it happen.
* People can search Rightmove for residential resale, new homes, rentals,
commercial property and overseas properties and use tools and information
including getting a Mortgage in Principle, checking local sold prices,
property valuations, market trends, maps and schools.
* Customers include the following key groups: estate agents, lettings agents,
new homes developers, rental operators, commercial property operators and
overseas property agents.
* Using the UK's largest housing datasets, we issue a number of regular
reports to track housing market indicators: our monthly House Price Index
(established 2002), our quarterly Rental Trends Tracker (established 2015),
and a weekly Mortgage Rates Tracker (established 2023). Historical data is
available on request.
* Founded in 2000, Rightmove listed on the London Stock Exchange in 2006 and
is a member of the FTSE 100 index.
 

 1  (#_ftnref1) Published on 22 April, for the period 10 March to 13 April
2024.

 2  (#_ftnref2) Published on 29 April, for the period 1 January to 31 March
2024.

 3  (#_ftnref3) Source: Comscore Media Metrix Desktop, Mobile Web, Mobile App,
March 2024, United Kingdom. Comscore revised Desktop data is based on
preliminary April 2024 data analysis for the United Kingdom.



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