Strong H1 for classifieds at Axel Springer
03 Aug 2016
We’ve become used to the message every quarter that classifieds contributed handsomely to Axel Springer’s revenue and profit.
But, in H1 of FY2016 the division classifieds took its performance (and importance to the company) a notch higher: it grew revenue strongly, while all other divisions in the German media group registered negative revenue growth (declines). Thereby turning from a pillar into a lifeline.
The division classifieds (here is the portfolio of sites) grew revenue by 19.5 percent to €425 million ($468 million U.S.) in H1 of FY2016 from €355 million in the same period of FY2015. In contrast, revenue dropped in the three divisions paid models, marketing models and services (eg. printing).
Thanks to classifieds, total revenue earned by the company grew in the period. If only barely, by 0.5 percent to €1.58 billion from €1.57 billion.
To be fair to these three divisions, the acquisition last year of real estate group Immowelt (with its row of sites, including Immonet.de, Immonet.de, Immowelt.at, Immowelt.ch, Bauen.de, Umzugsauktion.de, Ferienwohnung.de, Wohngemeinschaft.de, Immosolve.de and Crozilla.com) was reflected in the books for the first time this year. Excluding this once-off factor, revenue grew a more modest 12 percent (instead of 19.5 percent). Twelve percent is also what Axel Springer called “the organic growth rate” of classifieds, in the H1 financial report released this morning.
The EBITDA of the classifieds division grew 17 percent to €171 million from €147 million in H1 of FY2015. And the division’s EBITDA margin remained above 40 percent (40.2 percent), slightly below last year’s 41.2 percent.
The juiciest bit for last: in H1 classifieds grew its share of total revenue to 27 percent, from 23 percent in H1 of FY2015. Nothing shabby about that!
In Q2 @Leisure Group, a leading operator of holiday rental sites in Europe owned by Axel Springer, announced two acquisitions. In April, the company acquired 50.01 percent of holiday home site Traum-Ferienwohnungen; in May it made a takeover bid for Land & Leisure A/S (site DanCenter in Denmark, Sweden, Norway, and site Danland in Germany). In July, the anti-trust authority approved the deal, and @Leisure Group acquired a controlling stake in Land & Leisure A/S.
Rest of financial year?
And what does Axel Springer expect for classifieds in the rest of the year?
The revenue of classifieds is expected “to rise in the low double-digit percentage range, driven mainly by organic growth”, said Axel Springer. (More or less at same pace as in H1 – editor.)
“We expect EBITDA to increase in the lower two-digit percentage range, (pulled down by) increased investments in technology and higher marketing expenditure,” said the company. (Slightly lower than in H1 – editor.)