Rightmove Share Price Fell 5.79% Despite Its FY ’23 Profits Surge

The Rightmove Plc (LON: RMV) share price fell 5.79% after releasing its annual financial report for the year ended 31 December 2023. In 2023, the company witnessed a 10% increase in revenue, reaching £364.3 million, driven by customers upgrading their services and expanding their digital product use. 

The company, which operates the UK's largest online real estate property portal, revealed that its operating profit rose 7% to £258.0 million from the previous year's £241.3 million, with an underlying operating profit of £264.6 million, marking an 8% increase. 

Basic earnings per share grew by 5% to 24.5p, and underlying basic earnings per share saw a 6% increase to 25.2p. The company declared a 10% higher final dividend of 5.7p per ordinary share for 2023, leading to a total dividend increase of 9% to 9.3p. 

Shareholder returns through share buybacks and dividends amounted to £201.7 million in 2023. Cash and cash equivalents, including money market deposits, stood at £38.9 million at the period's close.

Operational achievements included a 9% rise in the average revenue per advertiser (ARPA) to £1,431 monthly. The total membership saw a slight decrease of 1% to 18,785, with a reduction in both Agency branches and New Homes Developments. Despite a decrease in platform usage to 15.4 billion minutes, this was still significantly higher than in 2019.

The adoption of premium packages by independent agents and developers continued to grow, highlighting the effectiveness of the company's offerings in attracting and retaining customers. Strategic innovations aimed at digitising sales and rental transactions were introduced, including solutions for agent mortgage brokers and a comprehensive digital journey for renters and rental agents.

The company also made strides in environmental sustainability, revising its emission targets and launching initiatives to support the property industry's green transition. 

Looking ahead to 2024, the company anticipates ARPA growth of £100-£110, primarily driven by the new Optimiser Edge package, continued product uptake, and contract renewals, expecting 7-9% revenue growth. 

Despite potential customer number reductions due to macroeconomic uncertainties, the company plans to continue its innovation investments and strategic growth in commercial real estate, rental services, and mortgage lead generation, aiming for an underlying operating margin of 70%.

The company's commitment to organic investment, a progressive dividend policy, and share buybacks remain firm.

Rightmove share price. 

The Rightmove share price fell 5.79% to trade at 536.60p from Thursday’s closing price of 569.60p.