Scout24 AG records further growth in Group revenues and profitability for the third quarter of 2015

  • Strategic shift and focus on core businesses paying off
  • Robust topline growth with revenues up 15.8% to EUR 99.2m
  • Significant surge in profitability with ordinary operating EBITDA up 33.7% to EUR 49.1m
  • On track to meet full year targets for 2015

Berlin / Munich, 11 November 2015 – Scout24 AG ("Scout24" or “the Group”), leading operator of digital marketplaces specializing in the real estate and automotive sectors in Germany and other selected European countries, reported its consolidated financial results for the third quarter and the first nine months of the financial year 2015.

Scout24 continued its growth path and has reached significant increases in both revenues and profitability, mainly driven by the strong organic performance of its core businesses and particularly through the introduction of the membership model in ImmobilienScout24 ("IS24") and by increasing customer numbers in all AutoScout24 ("AS24") core markets. Furthermore, the Group’s performance has also benefited from additional capability acquisitions to strengthen the value chain offering as well as from Management’s focus on operational efficiency through continuous cost base improvements and the generation of synergies between its two core businesses. As a result, Scout24 Group revenues grew by 15.8% to EUR 99.2m in the third quarter of 2015 (2014: EUR 85.7m), while ordinary operating EBITDA surged 33.7% to EUR 49.1m in the third quarter of 2015 (2014: EUR 36.7m), improving profitability margins by approximately 6.6 percentage points.

“Our business performance during 2015 is further proof that Scout24 remains highly relevant to both our audiences and our customers and that we are on a dynamic and steady growth track.” said Greg Ellis, CEO of Scout24 Group and added: “We are highly confident that we will meet our full year targets for 2015 and are very positive about the Company’s long term growth prospects.” 

Business Development

The strategic shift and focus on the two core businesses is already paying off, with revenue growth reaccelerating in both businesses.

IS24 external revenues grew by 16.8% compared to the three-month period ended September 30, 2014. This increase is mainly driven by an increase in revenues from core agents, benefitting from the introduction of the membership model since October 2014. As of September 30, 2015, IS24 reached a membership penetration of 71%, while core agent ARPU (average monthly revenue per agent) in the three-month period ended September 30, 2015 increased to EUR 623 (+22.2% compared to the three-month period ended September 30, 2014). The average number of core agents decreased by 1,561 to 20,324 as a result of smaller agents shifting to the professional pay-per-ad model, some agents going out of business and churn, all of the latter mainly driven by the introduction of the membership model and regulatory changes in Germany that now require the landlord to pay the agent (“Bestellerprinzip”). Despite the reduction in average agent numbers, IS24’s consumer proposition remained intact with the total number of listings on the IS24 platform remaining broadly stable at 525 thousand listings as per September 30, 2015.

At AS24, further significant growth was realized across all core geographies. In Germany, following the strategy to focus on listings leadership and enhancing the consumer experience with a revamped mobile offering as well as the continuous execution of the dealer acquisition strategy over the last twelve months AS24 has managed to increase the number of listings in Germany by 10.5% to 1,133 thousand (versus 1,025 thousand in September 2014). Similarly, the average number of core dealers increased to 21,976, representing an increase of 15.8% compared to the three-month period ended September 30, 2014. Core dealer ARPU (average monthly revenue per dealer) for the three-month period ended September 30, 2015, increased by 3.5% to EUR 171. In addition AS24 extended its market leadership position with the combined number of listings in Belgium (including Luxembourg), the Netherlands and Italy growing by 23% to 789 thousand (versus 643 thousand in September 2014). Furthermore, through the roll-out of the “MIA” product in Benelux and Italy (a pricing approach similar to the VIA power products in IS24), AS24 was able to increase the number of core dealers by 6.8% compared to the three-month period ended September 30, 2014 to 17,279, while core dealer ARPU grew by 8.1% to EUR 177.

In order to further support the Group’s growth path, Scout24 recently launched revamped advertising formats and packages. In addition, Scout24 upgraded the advertisement technology to improve targeting capabilities, allow for programmatic advertising with real-time bidding and extend audience. In line with the Group’s OneScout24 strategy, a new comprehensive business function called Scout24 Media was launched in September which supports all ad sales activities, regardless of whether they are launched on IS24 or AS24 platform. This initiative will help drive lead generation and ad sales businesses and further enhance Scout24’s position as a leading premium and data-driven publisher in Germany and Europe.

Moreover, an important change in the Scout24 financing and ownership structure was brought on its way through the Company’s listing in the regulated market (Prime Standard) of the Frankfurt Stock Exchange on October 1, 2015. With the IPO, Scout24 obtains direct access to the capital markets and a broader shareholder base. The offering included 7,600,000 new shares by way of a capital increase, corresponding to EUR 228 million gross proceeds for Scout24, of which EUR 214 million were directed to the repayment of financial liabilities in October 2015. Net financial debt[1] as of September 30, 2015 was EUR 921.0m (December 31, 2014: EUR 624.2m). Taking into account the aforementioned pay-down, pro forma net financial debt as of September 30, 2015 was EUR 707.0m.   

IPO related costs of EUR 5.4 million and additional non-operating costs of EUR 2.8 million, affected the reported EBITDA for the third quarter 2015, which amounted to EUR 40.9 million. However, the Group’s ordinary operating EBITDA improved by 33.7% to EUR 49.1 million, while the ordinary operating EBITDA margin increased to 49.5% compared to 42.9% in the three-month period ended September 30, 2014.

Summary Overview of Financial Results

The table below provides a summary overview of the Group’s performance for the third quarter and nine months ended September 30, 2015. Given the Group’s complex financial history, to facilitate year-over-year comparison and to better represent the business trends and situation of Scout24, additional, voluntary disclosure has been provided for the nine-month period ended September 30, 2014 which is based on the sum of financials from Scout24 Holding GmbH financial statements for the period January 1, 2014 to March 31, 2014 and Asa NewCo GmbH financial statements for the period April 1, 2014 to September 30,14.[2]

(in EUR million)

three-month period  ended

 

nine-month period ended

 

 

Sep. 30 2015

Sep. 30 2014

%

change

Sep. 30 2015

Sep. 30 2014[3]

%

change

External Revenues

99.2

85.7

15.8%

288.4

252.9

14.0%

 therein Core operations

98.4

85.0

15.8%

286.0

250.6

14.0%

            IS24

67.9

58.1

16.8%

197.0

170.1

15.7&

            AS24

30.0

26.2

14.7%

87.4

77.4

12.8%

            Corporate

0.5

0.7

nm

1.7

3.0

nm

Reported EBITDA[4]

40.9

1.2

nm

125.7

61.0

106.1%

 therein Core operations

40.9

1.3

nm

125.6

63.5

97.6%

            IS24

38.8

27.3

42.4%

112.1

90.0

24.6%

            AS24

10.1

3.2

211.8%

31.7

14.4

120.4%

            Corporate

(7.9)

(29.2)

nm

(18.2)

(40.8)

nm

Ordinary operating EBITDA[5]

49.1

36.7

33.7%

144.6

109.6

31.9%

 therein Core operations

48.9

37.1

32.1%

144.1

  110.9

30.0%

            IS24

41.0

30.8

32.9%

119.2

94.6

26.0%

            AS24

11.2

9.8

14.9%

34.9

23.9

46.1%

            Corporate

(2.0)

(2.5)

21.1%

(6.4)

(5.7)

11.5%

            Management fee reconciliation[6]

(1.3)

(1.1)

(22.9%)

(3.6)

(1.9)

nm

Ordinary operating EBITDA margin

49.5%

42.9%

6.6pp

50.1%

43.3%

6.8pp

            Core operations

49.7%

43.6%

6.1pp

50.4%

44.2%

6.2pp

            IS24

60.4%

53.1%

7.3pp

60.5%

55.6%

5.0pp

            AS24

37.5%

37.4%

0.1pp

39.9%

30.8%

9.1pp

Capital expenditure

5.5

3.1

76.6%

13.8

6.5

110.9%

Cash contribution[7]

43.6

33.6

29.7%

130.8

103.1

26.9%

 

The complete financial report for the first nine months and the third quarter of 2015 is available at
en/Investor-Relations/Financial-Publications/Financial-Reports/financial-reports.aspx.

Outlook

Scout24’s business policies are directed towards sustainable and profitable growth in the future.

The Group expects favourable tailwinds in the macroeconomic backdrop as well as in the German real estate and the European automotive market. Scout24 is well positioned to benefit from those tailwinds, given the focus on its core operations and the European markets, where it benefits from leading market positions, high brand recognition and significant audience reach.

Therefore, Management also gives a positive outlook for the full financial year 2015, expecting total external revenues of around EUR 390m and an ordinary operating EBITDA margin at a level between 47.5% and 49.0%. IS24 revenue growth is expected to further benefit from the ongoing membership migration and an uplift in ARPU. For AS24’s core markets, revenue growth will be driven by an increase in both ARPUs and core dealer bases.

Non-operating items will be affected by cost related to the IPO in an amount of up to EUR 7m, in addition to around EUR 15m of non-operating items for the full year 2015 deriving from the reorganization and restructuring started in 2014. Capital expenditure is expected to be at around EUR 20m for the full year of 2015, mainly driven by investments in the AS24 platform.

Conference Call

On Wednesday, November 11, 2015, 2:00 p.m. CET, Scout24 will host a conference call and webcast for financial analysts and investors. You may dial in using the following numbers:

DE: +4969222229043

UK: +442030092452

USA: +18554027766

Participant PIN code: 82438614#

The webcast, as well as a replay, will be made available at
http://scout111115-live.audio-webcast.com

 

About Scout24

Scout24 operates leading digital classifieds platforms in Germany and other selected European countries. The main operations under the umbrella brand Scout24 are the digital marketplaces ImmobilienScout24 and AutoScout24. ImmobilienScout24 is the leading digital real estate classifieds platform in Germany, based on consumer traffic and time spent as well as customer numbers and listings. AutoScout24 is a leading automotive digital classifieds platform in Europe, in terms of unique monthly visitors and listings. Scout24’s digital marketplaces are empowering people to realise their property and car-owning dreams simply, efficiently and stress-free. Further information is available at www.scout24.com

Investor Relations contact

Britta Schmid
Vice President Investor Relations & Treasury
Tel.: +49 89 44456 3278    
Email: ir@scout24.com

 

Press contact

Marie Fabiunke
Head of Corporate Communications & PR
Tel.: +49 30 243 01 1427
Email: marie.fabiunke@scout24.com

 

Disclaimer:

This document has been issued by Scout24 AG (the “Company” and, together with its direct and indirect subsidiaries, the "Group")) and does not constitute or form part of and should not be construed as any offer or invitation to sell or issue, or any solicitation of any offer to purchase or subscribe for, any securities of the Company, nor shall any part of it nor the fact of its distribution form part of or be relied on in connection with any contract or investment decision, nor does it constitute a recommendation regarding the securities of the Company or any present or future member of the Group.

All information contained herein has been carefully prepared. However, no reliance may be placed for any purposes whatsoever on the information contained in this document or on its completeness. No representation or warranty, express or implied, is given by or on behalf of the Company or any of its directors, officers or employees or any other person as to the accuracy or completeness of the information or opinions contained in this document and no liability whatsoever is accepted by the Company or any of its directors, officers or employees nor any other person for any loss howsoever arising, directly or indirectly, from any use of such information or opinions or otherwise arising in connection therewith.

The information contained in this press release is subject to amendment, revision and updating. Certain statements, beliefs and opinions in this document are forward-looking, which reflect the Company’s or, as appropriate, senior management’s current expectations and projections about future events. By their nature, forward-looking statements involve a number of risks, uncertainties and assumptions that could cause actual results or events to differ materially from those expressed or implied by the forward-looking statements. These risks, uncertainties and assumptions could adversely affect the outcome and financial effects of the plans and events described herein. Statements contained in this document regarding past trends or activities should not be taken as a representation that such trends or activities will continue in the future. The Company does not undertake any obligation to update or revise any information contained in this press release (including forward-looking statements), whether as a result of new information, future events or otherwise. You should not place undue reliance on forward-looking statements, which speak only as of the date of this document.

This document is not an offer of securities for sale in the United States of America. Securities may not be offered or sold in the United States of America absent registration or an exemption from registration under the U.S. Securities Act of 1933, as amended. Neither this document nor any copy of it may be taken or transmitted into the United States of America, its territories or possessions or distributed, directly or indirectly, in the United States of America, its territories or possessions or to any US person.

By attending, reviewing or consulting the presentation to which this document relates or by accepting this document you will be taken to have represented, warranted and undertaken that you have read and agree to comply with the contents of this notice.

Nothing in this document constitutes tax advice. Persons should seek tax advice from their own consultants or advisors when making investm

[1] Net financial debt is defined as total debt (nominal value of interest bearing liabilities) less cash and cash equivalents.

[2] As in the segment information in the unaudited interim consolidated financial statements of AsaNewCo GmbH as of and for the six month period ended June 30, 2015.

[3] These figures represent the sum of financials from the audited consolidated financial statements of Scout24 Holding GmbH for the short financial year from January 1, 2014 until March 31, 2014 and the segment information for the period of April 1, 2014 to September 30, 2014 in the unaudited interim consolidated financial statements of Asa NewCo GmbH as of and for the six-month period ended June 30, 2015.

[4] EBITDA is defined as profit before financial results, income taxes, depreciation and amortization, impairment write-downs and the result of sales of subsidiaries.

[5] Ordinary operating EBITDA represents EBITDA adjusted for non-operating and special effects, ordinary operating EBITDA margin of a segment is defined as ordinary operating EBITDA as a percentage of external  segment revenues.

[6] Ordinary operating EBITDA of Core operations includes reconciliation of management fee charges by the Corporate segment to the IS24 and AS24 segments, as the management fee is part of the ordinary operating result of Corporate while in the IS24 and AS24 segments, it is accounted for as a non-operating effect and therefore excluded from ordinary operating EBITDA for IS24 and AS24.

[7] Cash contribution is defined as ordinary operating EBITDA less Capital Expenditure.