Rea Group Ltd · ASX:REA
Rea — H1 2024 Earnings Presentation
44 slides from Rea's earnings presentation, Feb 8, 2024
Slide 1: REA Group Investor & Analyst Presentation H1 FY24
ASX Announcement 8 February 2024 REA Group Investor & Analyst Presentation H1 FY24 On behalf of REA Group Ltd (ASX:REA) please find attached a results presentation for the half-year ended 31 December 2023. -ends- For further information, please contact: REA Group Ltd Investors: REA Group Ltd Media:
Slide 2: Half year results
Slide 3: Agenda
Agenda Financial highlights Property market update Business highlights Financial results update ~ O)REAGroup
Slide 4: Financial highlights
Slide 5: FY half year core financial results
FY 24 half year core financial results Revenue"’ EBITDA’** Net profit after tax’ Reported net profit after tax” $726m $439m $250m $127m +18% +22% +22% -37% 60% $0.87 «16% $1.89 .22% $314m $84m Operating Dividend per share, Earnings 31 December 2023 Net debt? EBITDA’ 2.3margin FY24 interim Per Share!
Slide 6: Property market update
Property market update © REAGroup
Slide 7: The Australian property market has normalised, and new lending has improved
The Australian property market has normalised, and new lending has improved New national listings modestly below the 6-year average in New lending improved during the half as property prices and Q2, with the large YoY increase in Sydney and Melbourne sales volumes increased. The value of new mortgag
Slide 8: Increase in buyer enquiries and reduction in days on site
Increase in buyer enquiries and reduction in days on site demonstrates strong demand Demandis healthy with buyer enquiries up 15% YoY’, following Strong demand has resulted in a reduction in days on site as an extraordinary level of enquiries in IH22 and weaker properties turn over more quickly and
Slide 9: Business Highlights
Slide 10: 1H24 highlights
1H24 highlights Consumer highlights 10.6m unique audience’ Australia’s #1 property portal'®) Highly engaged and loyal audience with 2.8x as many app users as nearest competitor @ realEstimate” More than 1in 4 Australian properties tracked by owners? 41% YoY increase in properties tracked by their ow
Slide 11: Clear focus on strategic priorities
Clear focus on strategic priorities Largest audiences, most engaged consumers Building the next generation marketplaces Superior customer value Unparalleled data insights () Refer to page 42 for audience metric sources. Audience & Consumer Engage Australia’s largest audience of property seekers"®),
Slide 12: Australia's #1 address in property in every state
Australia’s #1 address in property in every state” % Average monthly realestate.com.au unique audience on all platforms 10.6m° 5.5m Exclusive monthly audience") 020 mm Total average monthly visits to realestate.com.au on all platforms 126m 5x More total time spent on realestate.com.au compared to ou
Slide 13: Engaging member experiences driving quality leads and delivering deeper market insight
Engaging member experiences driving quality leads and delivering deeper market insight x Register for inspection 24 Shearwater Esplanade Sar Sample sample@outiookcom 0435 620 478, () REA internal data, Jul 23 - Dec 23 (average). (2) REA internal data, Jul 23 - Dec 23 (average) vs. Jul 22 - Dec 22 (a
Slide 14: Customers highly engaged with our premium suite of digital products and services
Customers highly engaged with our premium suite of digital products and services Premiere+ & Audience Maximiser record penetration Record Premiere+ penetration, exceptional yield growth, and record AMAX penetration +20% vor Increase in Monthly Active Ignite Users! with 32% YoY growth in customers on
Slide 15: New Pro subscription launched in October
New Pro subscription launched in October $599 per month! PIPPINSHALL Pippin & Hall - Richmond « 1 soar rae 78 listings Agency Marketplace Agency Services 7 a ; Comparable Agency Elevate Market Analysis Agency Elevate I d Enrichment |g Agency Dashboard with greater onsite brand visibility and Discoun
Slide 16: Ignite - a unique integrated digital platform for customers
Ignite - a unique integrated digital platform for customers Differentiating REA’s offering and connecting customers with Australia's largestand most active property audience.) Ignite supports customers to efficiently and effectively do business aD Lead generation Innovative digital Asuite of integra
Slide 17: Next generation marketplaces
Next generation marketplaces PropTrack data and solutions driving revenue and powering unique products and experiences + PropTrack achieved double digit revenue growth for the half * Propensity to List score integrated into Ignite’s Seller Lead Enrichment, providing Pro subscription customers with g
Slide 18: REA India - Housing.com the #1 property portal in India
REA India - Housing.com the #1 property portal in India!) O/ Share of app downloads in HI), Closest competitor for web traffic, © india revenue growth YoY 46 %o 43% YoY app traffic growthl® 1.2x average monthly visits +5% YoY"0 21 %o 9 App-first strategy delivering strong results Audience leadership
Slide 19: Global investment
Global investment PropertyGuru Group delivered 13% YoY revenue growth in Q3 with growth in Singapore and Malaysia helping offset ongoing challenges in Vietnam! Sharp decline in US existing home sales to a historical low has resulted in a 15% decline in Move’s HI revenue® Market update: US Existing H
Slide 20: Sustainability is embedded within our strategic agenda
Sustainability is embedded within our strategic agenda 1H FY24 ESG highlights and priorities Social REA’s ESG highly material topics ee ace Product Quality & Service Diversity, Equity & Inclusion + Included in the Australia and Asia Pacific Dow Jones Talent Attraction & Retention Sustainability Indi
Slide 21: Market Outlook
Market Outlook
Slide 22: Financial results update
Slide 23: Core financial operating results
Core financial operating results Core results ($m)! HIFY24 HIFY23 Growth $ Growth % Revenue? Australia 6815 581.0 100.5 7% India 44.0 363 77 21% Group revenue 725.5 617.3 108.2 18% Operating expenses Australia (2.7) (187.0) (247) (13%) India (63.0) (59.1) (3.9) (7%) Corporate (121) (12.3) 0.2 1% Gro
Slide 24: Statutory (reported 4D) vs core results
Statutory (reported 4D) vs core results Statutory Core Significant items! H1FY24 ($m) (reported 4D) results! Group revenue? 725.5 : 725.5 + Group operating expenses o Fair value gain on previously held investment Group operating expenses (409.2) 122.4 (286.8) in CampaignAgent o Integration costs for
Slide 25: Strong growth in Residential revenue
Strong growth in Residential revenue Driven by double-digit Buy yield growth, higher listings and improved geo-mix, partially offset by revenue deferral Residential revenue ($m) Residential national buy listings YoY change 505 7B +19% Ql Q2 Q3 a4 Ql Q2 HIFY23 HIFY24 FY23 FY23 FY23 FY23 FY24 FY24 Nat
Slide 26: Record Premiere+ penetration
Record Premiere+ penetration With YoY growth across all states Residential buy listings penetration (depth)! Record Premiere Residential Buy listing depth penetration * Total depth penetration has increased sequentially and YoY + HIFY24 has seen record Premiere penetration (including Premiere+) + Pr
Slide 27: Commercial & Developer
Commercial & Developer Revenue up 11% with strong growth in Commercial, and modest growth in Developer Commercial & Developer Developer project launches revenue ($m) YoY change vy : - Ql Q2 Q3 Q4 Ql Q2z HIFY23 HIFY24 FY23 F238 FY28FY23FY24FY24 Commercial revenue drivers: + Higher yield, driven by re
Slide 28: Financial Services
Financial Services Settlements down 4%, but submissions growth turned positive during the half, up 1% YoY Financial Services revenue ($m) 35 +4% $6 HIFY23 HIFY24 Financial Services revenue growth of 4% driven by: + Increased penetration of our higher-margin white label products, including Freedom (A
Slide 29: Strong India revenue growth
Strong India revenue growth Driven by Housing.com price rises, increased depth and continued customer growth India revenue ($m)! ot 21%" “4 36 2 2 32 as +32% HIFY23 HIFY24 mProperty & Advertising = Adjacency Revenue increased 21% to $44m: + 32% growth in Property & Advertising revenues (Housing.com
Slide 30: Equity accounted associates
Equity accounted associates Total share of core associate loss of $13m in HI FY24, down from a $12m loss in HI FY23 Move, Inc. ($m)? PropGuru ($m)! 3 Other ($m)* HIFY23 HIFY24 HIFY23 HIFY24 HIFY23 HIFY24 | ed —— - @) (2) 0} 2) W) * Revenue down 15% to US$269m due to + PropertyGuru reported 13% reven
Slide 31: Positive Group and Australian operating jaws
Positive Group and Australian operating jaws Operational expenses($m)! 287 Australia operating results growth! 23% W% o REA India 18% excl Moc 3 11% ~ =COGs \ 2% 0paatine® anit 11% excl Moc (incl. travel & entertainment) s 3 Technology and other 3% 3 m Marketing related 4% ¢ FY2I FY22 FY23 HIFY24 Em
Slide 32: Increased investment in strategic initiatives
Increased investment in strategic initiatives Group capital expenditure ($m) Investment strategy 40.0 25% 120.0 nig. . 20% 100.0 95 MEE Office fit out costs & 800 16% 3 memes REA Ince capex g 60 S mmm Australia Capex 2 600 3S g . . 10% 2 D&A expense 40.0 - Capex as % revenue 5% (excl office fit out)
Slide 33: Strong cash position funding further investment
Strong cash' position funding further investment Group cash flow ($m) a7) Opening Receipts Paymentsto Income Netinterest Investment Other Dividends Other Closing cash cash from suppliers taxespaid —_ paid in investing paid ~— financing _ balance! balance customers and subsidiaries activities activit
Slide 34: Current trading
Current trading + January National residential new Buy listings were up 12% YoY, with Sydney and Melbourne both increasing by 28%. Combined listings for December and January were in line with the 6-year average. If this trend continues, we would anticipate FY24 YoY listings growth of 3-5%. + Residen
Slide 35: Q&A
Q&A ts Owen Wilson ¢ / Chief Executive Officer Janelle Hopkins Chief Financial Officer O REA Group
Slide 36: Supplementary Information
Supplementary Information Where 10 million Australians buy, rent & sell realestate. com. aU ustralia's #1 address in prope © REAGroup
Slide 37: Core vs. reported reconciliation
Core vs. reported reconciliation Growth Core vs. reported recon HIFY24 HIFY23 % Share of associate non-core costs Core operating income 725.5 617.3 18% . REA'S share of restructuring anginy airment costs offset by revaluation gains from financial liabilities incurred by Core and reported operating i
Slide 38: Cash flow reconciliation
Cash flow reconciliation Cash flow recon: n ($m: HIFY24 HIFY23 Growth EBITDA’ 426.0 347.3 23% Working capital movement (73.1) (42.0) (74%) Net interest paid (7.6) (5.4) (41%) Income taxes paid (88.8) (101.2) 12% Capital expenditure (60.0) (58.7) (2%) Other 14.7 77 92% Free cash flow 211.2 147.7 43%
Slide 39: Revenue breakdown
Revenue breakdown Revenue category!:2($m) HIFY24 HIFY23 Growth Revenue category!:2($m HIFY24 HIFY23 Growth Australia Australia Total depth revenue’ 555.8 466.2 19% Residential bevel oe ne we Subscription revenue? 30.0 30.9 (3%) wonmercial SomeoPet 59.6 492 n% . a 4 .. /o Media, Data & Other 59.6 49.
Slide 40: Financial comparatives: half year
Financial comparatives: half year Core Financial Results’ Reported HIFY20 HIFY2I HIFY22 HIFY23 HIFY24 HIFY24 Group results Growth % $m Growth % Growth % $m Growth % $m Growth % $m Total revenue? 440.3! (6%| 430.4! (2%) i 37% 6173! 5% 725.5! 18% 725.5 Total operating income 440.3; (6%)| 430.41 (2%) 3
Slide 41: Financial comparatives
Financial comparatives FYI9 FY20 Core Financial Results! FY21 FY22 FY23 Reported FY23 Group results $m Growth% $m Growth% $m Growth% $m Growth% $m Growth % $m Total revenue? 8749! a%| 820.3! (6%) 927.81 13%| 1169.5! 26%| 1183.2! 1% 1183.2 Total operating income 874.9 3%} 820.3, +(6%)| ~—=«927.8 13%]
Slide 42: Glossary
Glossary Buyer enquiries Buyer enquiries include email enquiry, phone number reveals, applied for inspection, SMS agent, and Developer brochure downloads. Cash Cash includes cash and cash equivalents. EBITDA Earnings before Interest, Tax, Depreciation and Amortisation excluding contribution from ass
Slide 43: Audience metric sources
Audience metric sources A Ipsos iris Online Audience Measurement Service, July - Dec 2023 (average), P14+, PC/laptop/smartphone/tablets, text only, Homes and Property Category, Realestate.com.au Brand Group, Audience (000’s). B Ipsos iris Online Audience Measurement Service, July - Dec 2023 (average
Slide 44: Disclaimer
Disclaimer The information in this presentation is in summary form only and does not purport to be comprehensive or complete. It contains information that has been derived from publicly available sources that has not been independently verified, This presentation should be read in conjunction with t