REA Group Ltd Annual Report 2021

REA Group Ltd | Annual Report 2021 8 REA delivered an outstanding result for the 2021 financial year, despite ongoing disruptions and volatility caused by COVID-19. I am continually impressed by the organisation’s ability to successfully navigate operational intensity and remain focused on progressing our long-term strategic imperatives. Financial highlights from core operations 8 for the full year included revenue 9 of $928 million, an increase of 13% and EBITDA including associates of $565 million, an increase of 19%. REA also maintained its strong core EBITDA margin at 60%. The Board has declared a final dividend of 72 cents per share fully franked. This represents a total dividend of 131 cents per share for FY21, a 19% increase on the prior year. While Australia’s real estate market was impacted by the pandemic and surrounding economic uncertainty, REA Group’s share price traded at record highs given the strong performance delivered in FY21. The Group’s strong financial results were testament to the dedication of REA’s talented workforce. Under our CEO Owen Wilson’s leadership, the team displayed an unwavering resolve to adapt at speed to introduce new customer and consumer innovations and various support measures to help agents and agencies. This operational excellence was complemented by the successful completion of a number of strategically significant transactions, which will deliver long-term sustainable growth opportunities. Building on the strong foundation of our financial services business, REA acquired Mortgage Choice Limited. Bringing Mortgage Choice together with our Smartline broker business accelerates our financial services strategy and gives REA the opportunity to become the leading mortgage broking business in Australia. REA moved to a controlling position in Elara Technologies Pte. Ltd. (“Elara”), which operates the Indian property websites Housing.com, Makaan.com and PropTiger.com. “ I am continually impressed by the organisation’s ability to successfully navigate operational intensity and remain focused on progressing our long-term strategic imperatives.” Chairman’s message India is one of the world’s fastest growing trillion dollar economies, experiencing rapid digitisation. This transaction presents a significant opportunity to leverage the combined talent and digital expertise across both REA and Elara and become the undisputed number one digital real estate business in India. Against the backdrop of a market heavily impacted by COVID-19, Elara delivered an impressive 23% YoY local currency revenue growth in FY21. In Asia, REA announced the transfer of its Malaysia and Thailand operations to PropertyGuru Pte. Ltd. (“PropertyGuru”), a leading digital proptech company operating marketplaces in Singapore, Vietnam, Malaysia, Thailand and Indonesia. This was in exchange for REA receiving an 18% 10 interest in PropertyGuru, which will provide the Group with a strategic shareholding in a larger, more diversified company. This transaction presents a unique opportunity to create the most compelling digital proptech group in Southeast Asia. 8 Financial results from core operations are defined as reported results adjusted for significant non-recurring items such as restructure costs, gain/loss on acquisitions and disposals, related transaction costs, integration costs and historic tax provision (historic indirect tax provision reflects potential retrospective changes to interpretation of tax law). In the prior year, this included items such as restructure costs, revaluation of contingent consideration, gain/loss on acquisitions, disposals and divestments, and impairment charges. 9 Revenue is defined as revenue from property and online advertising, and revenue from Financial Services less expenses from franchisee commissions. 10 Undiluted, 16.6% on a fully diluted basis if all warrants and ESOPs are exercised. Year in review