Singapore’s PropertyGuru stays in the red despite rising Q4 revenue

SINGAPORE — Singapore’s online property portal PropertyGuru reported a net loss of S$5 million ($3.7 million) in the fourth quarter of 2022.

The loss comes as global interest rates continue to rise and Vietnam, one of its main markets, has tightened its mortgage borrowing.

Net loss for the three months to December 2022 was SG$5.2 million. It’s almost 30% improvement over the prior quarter net loss of SG$7.4 million.

Net losses for the full year in 2022 amounted to SG$129.2 million, better than a net loss of SG$187.4 million the previous year.

The company has yet to report full-year profits since its launch in 2007. It currently dominates the Southeast Asian market.

“While it’s hard to say when PropertyGuru may be back in the black in terms of after-tax net profit, its 30% improvement in net loss is commendable,” said Maximilian Koeswoyo, research analyst at Phillip Securities.

Meanwhile, fourth quarter revenue was SG$40 million, an increase of about 17% from a year ago. Full-year revenue jumped 35% to SG$136 million.

Shares of PropertyGuru closed up 1.68% on Wednesday.

“Increased product adoption, improved pricing and the continued integration of the iProperty acquisition all helped offset tough market decisions. That said, macroeconomic and fiscal policy uncertainty continues to test our clients,” said Hari Krishnan, CEO and Managing Director of PropertyGuru, during the earnings call on Wednesday.

“We believe the headwinds our core markets are currently facing are largely temporary, and the longer-term track and underlying outlook for economic performance in Southeast Asia has not changed,” he said. said Krishnan.

Adjusted EBITDA, or earnings before interest, tax, depreciation and amortization, for the quarter was positive SG$5 million, up from an Adjusted EBITDA loss of SG$4 million in the same period in 2021.

Krishnan said higher borrowing costs and uncertainty surrounding national elections in Malaysia in November impacted sales, while the Singapore market remained resilient. In Vietnam, the government continued to tighten credit to manage debt levels, resulting in a decline in property list.

After acquiring its Southeast Asian competitors – such as iProperty and brickz in Malaysia, thinkofliving and Prakard.com in Thailand in 2021, and Batdongsan in Vietnam in 2018 — the company remains a dominant player in the region.

“PropertyGuru is definitely still in a growth-stage mindset as it continues to actively pursue new M&A opportunities and is focused on how it can provide a more comprehensive service offering on its platform. “, Koeswoyo told CNBC in an email.

“PropertyGuru’s stock has lost about 50% of its value since its listing in March 2022 and its daily volume is also low, so I think the stock hasn’t gotten much attention from investors,” said Koeswoyo.

“I think the stock is going to face challenges in the short term, especially with the cooling measures taken by governments in the Southeast Asian region, but I think there is going to be a turnaround. major once PropertyGuru shows the first signs of a positive after-tax net profit trajectory,” Koeswoyo said.

PropertyGuru expects the integration and scale of the Sendhelper acquisition “to negatively impact profitability by SG$3-4 million in 2023,” the press release said.

Sendhelper operates an app that offers home services such as cleaning and pest control and was acquired by PropertyGuru last year, marking the latter’s foray into the market.

The online property portal maintains a “conservative 2023 outlook” amid challenges, and forecasts full-year 2023 revenue of SG$160-170m and Adjusted EBITDA of SG$11-15m , he said in the statement.

PropertyGuru began trading on the New York Stock Exchange on March 18 last year.