REG - OnTheMarket plc - Trading Statement

OnTheMarketAnnouncement

14/12/2020 07:00

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RNS Number : 4679I  OnTheMarket plc  14 December 2020

The information contained within this announcement is deemed to constitute
inside information as stipulated under the Market Abuse Regulations (EU) No.
596/2014. Upon the publication of this announcement, this inside information
is now considered to be in the public domain.

 

14 December 2020

 

ONTHEMARKET PLC

("OnTheMarket", the "Group" or the "Company")

 

TRADING UPDATE

 

OnTheMarket plc (AIM: OTMP), the majority agent-owned company which operates
the OnTheMarket.com property portal, is pleased to announce the following
update on trading.

 

Current trading ahead of expectations

In the announcement of its interim results on 13 October 2020, OnTheMarket
stated that the Group expected revenues and costs to increase in the second
half of the year to 31 January 2021 from those reported for the six months to
31 July 2020, as it invests to enhance service and increase value to
customers. The Group also announced expectations to achieve a broadly
breakeven adjusted operating profit(1) position for the full financial year.

 

As a result of continued operational progress and strong consumer engagement,
the Company now expects to deliver revenues and adjusted operating profit
above market expectations for the current financial year to 31 January 2021.
Revenues are expected to be no less than £22.5m, with adjusted operating
profit no less than £1.5m. These expected results reflect the measures taken
during the year to support agents through customer discounts, whilst reducing
costs and conserving cash, particularly through a reduction in marketing
expenditure.

 

Cash position

At 30 November 2020, the Company had net cash of £10.9m and, excluding
deferred creditor payments of £0.4m, no borrowings. This represents an
effective increase of £2.2m from 30 September 2020, when the Company had net
cash of £10.3m and deferred creditor payments of £2.0m.

 

It is expected that marketing expenditure, to support consumer engagement and
lead generation for advertisers, will be higher in December and January than
in October and November. As such, the cash balance is likely to reduce
slightly to 31 January 2021 but remain strong, with sufficient scope to invest
in the business. Cash balances will also naturally fluctuate as creditor and
taxation payments fall due; nevertheless, the Board continues to focus on
balancing investment in the proposition whilst carefully managing the Group's
financial resources.

 

Outlook

The Company continues to monitor the impact of COVID-19. At this stage, in
light of the ongoing uncertainty and as a prudent measure until greater
clarity exists, the Company is not providing financial guidance beyond the
current financial year. With a strong cash position, the Company is planning
to increase investment in the business in the coming year, particularly in new
products and services, people and through restoring marketing expenditure to
more usual levels. This will position OnTheMarket to take advantage of the
significant growth opportunities available, benefiting the Group in the medium
and long term.

Clive Beattie, Chief Financial Officer, commented:

"As we approach our financial year end, I am pleased to report on a strong
performance since our interim results announcement, achieved through the
continued hard work and commitment of my colleagues and the support of our
loyal customers.

"Our revenue growth and financial discipline form the strong platform from
which we will continue to provide increasing value to our customers, whilst
our agent ownership and support, and our commitment to fair pricing, will
continue to differentiate OnTheMarket."

 

Footnotes

 

1)    Adjusted operating loss or profit is defined as operating loss or
profit before share based payments (including charges relating to shares
issued for agent recruitment), share of profit or loss from associates,
specific professional fees and non-recurring items. This is an alternative
performance measure and should not be considered an alternative to IFRS
measures, such as revenue or operating loss or profit.

 

ENDS

For further information, please contact

 

 OnTheMarket                                    0207 353 4200

 Clive Beattie, Chief Financial Officer

 Tulchan Communications                         0207 353 4200

 James Macey White

 Giles Kernick

 William Booth

 Zeus Capital (Nominated Adviser/Joint Broker)  0203 823 5000

 Jamie Peel, Martin Green, Daniel Harris

 (Corporate Finance)

 John Goold, Benjamin Robertson (Broking)

 Shore Capital (Joint Broker)                   0207 408 4090

 Daniel Bush, John More (Corporate Finance)

 Fiona Conroy (Corporate Broking)

 

Background on OnTheMarket:

OnTheMarket plc, the majority agent-owned company which operates the
OnTheMarket.com property portal, is a leading UK residential property portal
provider.

Its objective is to create value for shareholders and property advertiser
customers by delivering an agent-backed, technology enabled portal - offering
a first-class service to agents and new homes developers at sustainably fair
prices and becoming the go-to portal for serious property-seekers.

With almost 3,800 estate and letting agents as shareholders, or under contract
to become shareholders, operating 6,800 offices, OnTheMarket provides a unique
opportunity for agents to participate in the equity value of their own portal.
Agent backing and support enable OnTheMarket to display "New & exclusive"
properties to serious property-seekers 24 hours or more before agents release
these properties to other portals.

 

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