Zoopla is going from strength to strength thanks in part to its acquisition of comparison website uSwitch earlier this year, which is doing even better than expected, as well as a rise in estate agency customers.
According to its latest trading update to the City, Zoopla, which earlier this year acquired online price comparison site uSwitch for £160million in a move designed to differentiate it from rivals Rightmove and OnTheMarket, has attracted a further 146 UK estate agents to its membership since July, contributing to growth in turnovers and profits.
Zoopla has accepted that it lost business this year to challenger property website, OnTheMarket.com (OTM), but now insiststhat its UK agency membership is “continuing its return to growth.”
Zoopla now has a total of 12,701 agency customers on its books, along with 2,706 new homes customers and 737 overseas members.
Zoopla forecasts that full-year revenue will increase by a third to £107 million, with adjusted cash profit up by a fifth to £48 million. These optimistic projections are supported by the company’s decision to diversify its offering with its uSwitch acquisition, which has outperformed expectations, while its portal division was in line.
There has been a positive reaction to Zoopla’s return to growth, with Zoopla’s share pricing ending last week up 6 per cent to 247p, a seven-week high, driven by a vow that it will meet 2016 expectations.
But despite Zoopla’s return to growth, OTM’s Chief Executive, Ian Springett (left), believes that Zoopla’s latest update to the City only serves to underline the success and progress of OTM in continuing to disrupt the property portals market.
He said, “Zoopla Property Group’s latest trading update serves to highlight the success of OnTheMarket.com, which is already firmly established as a leading portal.
“The key fact is that over 90 per cent of our member agents moved both their properties and the associated listing revenue from Zoopla Property Group when they signed up to OnTheMarket.com. It is no surprise that its (Zoopla’s) UK agency membership remains 22 per cent down year-on-year or that it has increased by only 1 per cent since its last update for July.”
“Support for OnTheMarket.com continues to grow daily and we noted analyst William Packer from Exane BNP Paribas referring to ‘a healthy resilience’ across our membership base,” he added.