OnTheMarket to beat FY21 market expectations
(OTMP ) trading for the year to 31 January 2021 is ahead of previous forecasts following continued strong performance since the Christmas period.
The majority agent-owned company, which operates the OnTheMarket.com property portal, now expects to report revenues and adjusted operating profit for the annual period at around £23m (FY20: £18.8m) and £2.3m (FY20: £9.2m loss), respectively.
These surpass the Group’s previous forecast that revenues and adjusted operating profit for the year would come in at around £22.5m and £1.5m, respectively.
The Company said that measures taken during the year to support agents through customer discounts, whilst at the same time reducing costs and conserving cash, particularly through a reduction in marketing expenditure, had resulted in stronger than expected trading.
The Group cited continued strong performance over Christmas and through January with more than 1.8 million leads generated in January with an average of 146 per advertiser.
The number of visits to the site during January totalled 28 million while it also stated that weekly site visits have exceeded 6 million every week since the start of February 2021.
In particular, the Company said it has seen ‘continued operational progress and strong consumer engagement’ as a result of a successful marketing campaign, strong social media engagement, as well as the group’s new instant online valuation tool, “Value my home” which it said has been successful at ‘significantly increasing’ valuation leads to agents.
Due to the stronger than expected trading, at 31 January 2021 the Company reported that it had net cash of £10.7m and, excluding deferred creditor payments of £0.4m, no borrowings.
The Board informed investors that it continues to focus on balancing investment in the proposition to drive growth whilst carefully managing the Group’s financial resources.
Whilst OTMP said it will continue to closely monitor the impact of COVID-19, it expects marketing expenditure to return to ‘more usual pre-COVID-19 levels’ in the year to 31 January 2022.
‘With a strong balance sheet and anticipated continued growth in the revenue-generating customer base, the Company is also planning to increase investment in new products and services and to invest further in internal website development resources,’ it told investors.
“I am delighted that in a year of challenging circumstances, we are able to report that trading was ahead of our expectations from just a few months ago. Our results to 31 January 2021 build on the strong foundations we have in place upon which we intend to deliver our vision of a portal that provides value to customers and consumers at all stages of the property cycle,” commented Jason Tebb, Chief Executive Officer of OnTheMarket.
He added, “Our broad and deep agent ownership and support, our commitment to fair pricing and our focus on our agent customers at the heart of our business will continue to differentiate OnTheMarket.
We will seek to further evolve our offering through on-going product innovation and increasing consumer engagement through targeted, data-led marketing and the provision of a suite of additional services which will benefit estate agents, housebuilders and consumers.”
Investors will be pleased with the FY21 results amid all the disruption experienced during 2020. Furthermore, most of the strategic initiatives executed during the year will benefit the Company over the medium to longer-term and will enable the Group to take advantage of many of the significant growth opportunities, including expanding its offering across a broader suite of products and services to generate additional revenue at minimal cost.
Shares in OnTheMarket have increased by over three-fold since the beginning of April 2020 with the shares advancing by over 15% during February 2021.
Reasons to Follow OTMP
OnTheMarket, a majority agent-owned company which operates the OnTheMarket.com property portal, is a UK-based residential property portal provider. It aims to deliver an agent-backed portal to agents and new homes developers at ‘sustainably fair prices.’
Back in September 2020, OTMP unveiled to investors that it has signed a portal listing agreement with, one of the largest British-based house building companies.
The agreement followed three months of record leads for OnTheMarket during which the portal had seen average visits of 26.8 million per month and an average of 2 million leads per month. Over 2 million leads were generated in August 2020, an 64% year on year rise.
“As part of our growth strategy we have continued to attract a wealth of developers and expanding this sector remains a key priority for the portal,” commented Helen Whiteley, Commercial Director of OnTheMarket, at the time of the announcement.
Since that period, shares in OTMP have risen by over 15% in value. It said it believes its combined revenue growth and financial discipline will continue to provide ‘increasing value’.
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