Zoopla chief executive Alex Chesterman has branded rival property website OnTheMarket “a failed experiment” and said his company is winning back customers at a record rate.
OnTheMarket was set up last year to compete with Zoopla and Rightmove, the UK’s two biggest property portals. It allowed estate agents to list their properties more cheaply than its rivals but insisted that any agents using its site could use only one other portal. As the number two in the market, Zoopla was expected to suffer more defections.
However, in reporting full-year results on Wednesday, Mr Chesterman said Zoopla had won back 600 estate agents. “This is the beginning of the end for OnTheMarket,” he said.
Ian Springett, chief executive of OnTheMarket.com, later hit back at Zoopla, saying: “While it clearly suits Zoopla Property Group to position OnTheMarket.com as a ‘failed experiment’, this only serves to underline again some inconvenient truths for Zoopla . . . OnTheMarket.com continues to grow and the number of agent branches listing on the website at the end of October had increased by 15 per cent year-on-year.”
In the year to September, Zoopla’s revenue from these property services rose 9 per cent to £87m. Over the period, it had 927,000 properties listed on its sites — up almost a tenth on the year — and more than 23,000 estate agents and other customers using its products. These numbers have been growing for 18 consecutive months.
Mr Chesterman was cautious about the future, however. “Brexit has caused uncertainty, which has naturally led to a slowdown in property sales,” he said. But he added that “the rental market remains very strong”, and said rental deals outnumbered property sales by a ratio of three to one.
Overall Zoopla, which also owns the PrimeLocation and uSwitch websites, reported group revenues of £198m, up 84 per cent on the previous year, partly because of an acquisition. Pre-tax profits rose 38 per cent to £46m while earnings per share rose from 6.2p to 8.9p.
Zoopla raised its dividend by almost 50 per cent, from 3.5p per share to 5.2p.
Analysts at Numis said it was “a good set of full-year results”, which were a little ahead of estimates. Zoopla’s shares, which have risen by more than a third in the past year, outperforming those of rival Rightmove, were up by 5.8 per cent in Wednesday afternoon trading.
Alongside the results, Zoopla unveiled two new investments. It has put money into Neos, a home insurance company that uses connected devices such as alarms, smoke detectors and water detectors to monitor what is happening in the home. It has also bought Technicweb, which provides web design and hosting services to estate agents.
“We now have significant cross-selling potential with over 23,000 partners taking at least one of our services,” said Mr Chesterman, who added that the company was “stronger and more diversified than ever”.
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