Despite economic uncertainty and high interest rates, Domain delivers bumper FY24 result

As Australia battles economic uncertainty which has seen a major pullback in household spending, mortgages stress is pushing many families to breaking point with a bumper result for property tech company Domain Holdings (ASX: DHG) which has seen more listings at a time when borrowing power is weakened due to high interest rates. 

For the Full Year ended 30 June 2024, Domain reported statutory revenue of $391.1 million which was a 13% increase on the previous year, alongside a 28% increase in net profit after tax to $49.4 million. 

The company declared a final dividend of 4.0 cents per share, bringing the Full Year dividend to 6.0 cents per share. Domain’s strong performance was bolstered by an 18% increase in Average Revenue Per Listing and record depth penetration, highlighting the effectiveness of its Marketplace strategy.

Domain Managing Director, Jason Pellegrino, credited the company’s success to the efforts of its team and the strategic focus on delivering innovative solutions. 

“Domain’s strong FY24 results reflect the efforts of more than 1,000 talented people at Domain, who are delivering on our Marketplace strategy by building and releasing great solutions. Most pleasingly, our key assets of unique data, quality audiences, and product innovation have delivered ‘Only on Domain’ experiences that provide real benefits to consumers, agents, and enterprise customers,” he said. 

The FY24 results also demonstrated Domain’s ability to navigate the broader economic challenges posed by Australia’s high interest rates, which have led to a reduction in discretionary spending. Despite these headwinds, the housing market has continued to see rising prices, driven by strong demand and limited supply, which in turn has supported Domain’s business performance. Pellegrino noted that new listings growth improved each quarter of the year, particularly in the Sydney and Melbourne markets, which are traditionally strong.

Domain’s residential segment, in particular, saw a 19% increase in revenue, underpinned by growth in depth revenue and an 18% rise in Average Revenue Per Listing. This growth was driven by the introduction of new products, including the Platinum Edge add-on to depth contracts, which contributed to higher price realisation.

Pellegrino highlighted the success of Domain’s Audience Boost product, which launched in FY24 and delivered a 30% uplift in views per listing. This product, combined with Domain’s collaboration with Nine, has significantly enhanced the company’s ability to reach and engage a broader audience.

Looking ahead, Domain remains optimistic about its growth prospects, with plans to increase investment in its technology platforms while maintaining disciplined productivity improvements. The company expects stable EBITDA margins in FY25, balancing confidence to invest in ongoing growth with efforts to drive productivity.