Domain grows listings again with low interest rates driving demand
Low interest rates and a property market recovery have helped real estate listings group Domain Holdings report its first year-on-year rise in market listings since 2018 but the company remains cautious, deferring any dividend until its full-year results.
Domain’s results for the half year ending December 31 met market expectations with revenue of $138.4 million, which represents a like-for-like decline of 5.5 per cent, and a slight rise in net profit to $19.4 million.
“I am excited to report the first year-on-year growth in market listings since I joined Domain two-and-a-half years ago,” said Domain chief executive Jason Pellegrino.
“We are executing on the opportunity that lies in front of us. This is reflected in increased depth penetration, acceleration in our controllable yield, and 20 per cent like-for-like core digital EBITDA (earnings before interest, tax, depreciation and amortisation) growth in the first half.”
Mr Pellegrino sees further opportunities ahead in a low interest rate environment and from the potential for stamp duty reform.
“It is encouraging to see we are now entering a supportive environment for property, with low interest rates and high levels of demand. Although we have seen a modest early recovery, property turnover remains well below historic mid cycle levels. Longer term there’s an opportunity for stamp duty reform to provide a further step change to transaction volumes,” he said.
Last November Domain plans announced plans to cut almost 12 per cent in costs in the first half of the new financial year as it warned the spring selling season was weaker than previous years. The half year showed a cost reduction of 14.5 per cent but this included benefits from the Jobkeeper scheme.
The real-estate listings company scrapped its dividend at last year’s results after factors related to the coronavirus pandemic hit the company’s bottom line.
On Tuesday, the company said in light of the continued COVID-19 uncertainty the board has deferred consideration of a dividend until the full-year results.
Domain swung to a $227 million loss for the 2019-2020 financial year, dragged down by a major write-down of its digital division.
More to come
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Colin Kruger is a business reporter. He joined the Sydney Morning Herald in 1999 as its technology editor. Other roles have included the Herald’s deputy business editor and online business editor.
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Source: Thanks smh.com