Australia’s largest vehicle listing site, carsales, has continued to show strong profits despite a tougher vehicle market according to its 2019 financial year results.
Group revenue grew by 11% to $417.5m, underpinned by the core Australian classifieds businesses which continued to perform well. The Dealer and Private businesses proved resilient with revenue growth of 7% and 4% respectively.
Used car market conditions were favourable as consumers sought better value car options and this translated into growth in used car lead volumes, a decline in average time to sell, and excellent growth in traffic to the carsales sites.
Adjusted earnings before interest and tax was up 7% to $210.1.
The Board declared a final dividend of 25.0c per share, an increase of 5% on the previous corresponding period. This represents a total dividend of 45.5c per share, an increase of 3% on the previous financial year.
Group chief executive Cameron McIntyre says the company is pleased with the result despite the market challenges.
“This result is testament to the strength, resilience and diversified nature of our business, as well as our investment in new products and entry into new markets,” McIntyre says. “The strength of the Australian business is supported by our market leadership position and the depth and breadth of our offering to consumers and commercial customers.
“We continue to be the clear market leader in online auto classifieds in Australia with the largest and most engaged consumer audience. We continued to record good growth in key audience, traffic and enquiry metrics during the year.”
Its overseas investments – similar businesses in South Korea, Chile, Mexico, Argentina and Brazil – continue to perform well.
“We also continue to deliver on our international growth strategy. Our global businesses all made excellent progress in FY19, delivering an increasingly significant contribution to our results and building the foundations for long-term growth.
“Our two largest international businesses in South Korea and Brazil recorded particularly good revenue and earnings growth.”
“Our people remain our most important asset and critical to the business’ success. We are committed to maintaining an innovative and agile business that is capable of evolving in a fast-changing environment which, combined with a strong focus on our strategic priorities, positions us well for continued growth”, says McIntyre.
The report covered carsales market analysis, which indicates the used car market has remained strong and the company has benefited from being largely oriented towards used cars, offsetting some of the impact of the slowdown in new car sales.
“From a dealer perspective, carsales delivered good growth in enquiry volumes in FY19 to drive qualified sales opportunities. carsales recently released a new product that enables dealers to advertise their consumer finance offerings as an integrated option with their listings. This product has excellent potential to increase overall finance penetration rates as it will enable dealers to raise awareness of their native finance offering earlier in the sale process,” the report says.
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