Scout24 AG continues its revenue and profit growth path in the first half of 2017

Scout24 AG continues its revenue and profit growth path in the first half of 2017

• Revenues up by 8.1% to EUR 233.4 million
• Ordinary operating EBITDA-Margin at 52.6%
• Increased competitive advantage in terms of listings and traffic
• Reiterating guidance for financial year 2017

Berlin / Munich, 9 August 2017 - Scout24 AG ("Scout24" or "the Group"), the leading operator of digital marketplaces specialising in the real estate and automotive sectors in Germany and other selected European countries, further increased its revenue and profit in the first half-year of 2017 and is fully in line with expectations. The Management underpins the forecast given for the full financial year 2017.

According to the unaudited, yet reviewed by the auditor, consolidated financial statements, Group revenues for the half-year 2017 increased by 8.1% to EUR 233.4 million. Group ordinary operating EBITDA improved at a disproportionate rate and was up 12.3% to EUR 122.8 million, yielding a margin of 52.6%. Cash contribution also increased by 13.8% against the comparable period in 2016, further underlining the Company's ability to generate high cash flows. For the first time after the IPO and one year prior to expectations, in June 2017 a dividend of 0.30 EUR per no-par value share was distributed, allowing shareholders to benefit from this solid performance.

"With the release of our half-year results, we again proved our high profitability and cash-flow generating abilities. The dynamic development at AutoScout24 underlines our progress in achieving our growth potential. We are also very happy with the development at ImmobilienScout24. Core agent numbers remained stable even with the current market trends and the good performance accompanied by the optimisation measures we are implementing bode well for the second half of 2017, which we expect to be stronger than the first one. We believe there are still significant opportunities to tap in both the real estate and automotive value chains, which continue to underpin our growth story", said Greg Ellis Chief Executive Officer of Scout24 AG.

Overview of Financial Results

The table below provides a summary overview of the Group's performance for the first half year and second quarter ended June 30, 2017.

¹ 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.
² EBITDA is defined as profit before financial results, income taxes, depreciation and amortisation, impairment write-downs and the result of sales of subsidiaries.
³ Cash contribution is defined as ordinary operating EBITDA less capital expenditure.
⁴ Cash conversion is defined as ordinary operating EBITDA less capital expenditure divided by ordinary operating EBITDA.

The full half-year financial report including financial statements and additional details on segment level is available at www.scout24.com/ financial-reports.

Business Development
Group

Main growth drivers in the first half-year of 2017 were an expansion in the customer base and an increased penetration of visibility products at AS24, programmatic advertising and an improved offering of services along the real estate selling and rental process, both under the umbrella of the Group-wide function Scout24 Media.

Ordinary operating EBITDA increased by 12.3% from EUR 109.4 million to EUR 122.8 million yielding an increase in margin of 1.9 percentage points to 52.6% (H1 2016: 50.7%), reflecting a strong performance in the second quarter.
Reported Group EBITDA for the first half-year of 2017 increased against by 12.4 EUR million to EUR 112.1 million. This included non-operating costs of EUR 10.7 million (H1 2016: 9,6 EUR million). The non-operating costs essentially consist of personnel expenses as well as costs related to M&A activities. Personnel expenses include expenses related to reorganization and personnel expenses from share-based compensation totalling to EUR 2.2 million as well as performance-based remuneration from share purchase agreements totalling to EUR 1.5 million (H1 2016: EUR 1.2 million). Consolidated net income attributable to parent company owners amounted to EUR 54.9 million in the reporting period (H1 2016: EUR 29.7 million), which corresponds to basic earnings per share of EUR 0.51 (H1 2016: EUR 0.28).

Cash contribution increased by EUR 13.8 million in the first half-year of 2017 respectively by EUR 8.6 million in the second quarter 2017 against the comparable period 2016. The Cash Conversion rate, based on ordinary operating EBITDA, was stable at 92% in the first half of 2017. Cash and Cash Equivalents amounted to EUR 62.7 million as of June 30, 2017 (31 December 2016: EUR 43.4 million). Net financial debt (short- and long-term liabilities less cash and cash equivalents) stood at EUR 614.7 million, compared with EUR 633.9 million as of 31 December 2016. The ratio of net debt to ordinary operating EBITDA over the last 12 months fell to 2.58:1 (31 December 2016: 2.82:1).

Segment specific performance indicators listing and traffic levels also showed a good development in the first half of 2017. The competitive advantage in terms of listings increased for both marketplaces and overall traffic in terms of sessions in the first half of 2017 slightly surpassed the record levels reached in the first half of 2016 (H1 2017: 161 million sessions, H1 2016: 156 million sessions). Mobile traffic level increased from 63% (H1 2016) to 70% (H1 2017) year-on-year, reflecting the Group's efforts towards continuously improving user experience in line with the mobile-first strategy.

ImmobilienScout24 (IS24)

Revenues from core agents was up 1% to EUR 78.7 million in the first half of 2017 (H1 2016: EUR 77.9 million). ARPU (average revenue per core agent) increased by 8.3% to 761 Euro (H1 2016: 703 Euro), offsetting a decrease in number of core agents compared to the first half-year of 2016. At 17,046, the number of core agents remained stable compared to March 2017 (17,041 core agents) and decreased by 3.2% against June 2016 mainly due to agents leaving the market. In Q2 2017, excluding agents leaving the market, core agent numbers increased against Q1 2017 on the back of record low churn levels and significant increase in customer regain rate. Revenues from other agents increased by 2.9% against the prior year's comparable period, mainly driven by a dynamic development of revenues from the real-estate marketplaces in Austria. Other revenues went up by 11.4% to EUR 50,0 million (H1 2016: EUR 44.9 million). This was chiefly driven by initiatives in the area of services along the real estate selling and rental process, driven by the Group-wide function Scout24 Media.

IS24 strengthened further its market position in the first half of 2017 and managed to increase its competitive lead in terms of both listings and traffic share despite the market trend of listings slightly decreasing.

AutoScout24 (AS24)

As already in the first quarter 2017, the AS24 segment was on a strong growth path in the first half of 2017. External revenues were up by 15.1% compared to the first half of 2016.

This dynamic development predominantly reflects the sustainable growth in revenues from core dealers in Germany (20.2%) and in Benelux/Italy (18.7%). The revenue lines benefit from a strong increase in ARPU (average revenue per core dealer) as well as, in Germany, an increased dealer base. The ARPU growth was due to implemented price increases and the further successful uptake of the visibility products. Revenues from other dealers increased by 4.5% and other revenues by 5.1%, on a year-on-year basis.

Based on the number of listings, AS24 is still the market leader in Belgium (including Luxembourg), the Netherlands and Italy. In Germany, AS24 recorded its listings inventory at a constantly high level of more than one million listings per month and continues to work towards closing the gap to the closest competitor.

Outlook

Scout24 reported a successful half-year in 2017 with 8.1% revenue growth and an ordinary operating EBITDA-margin of 52.6%, which is fully in line with the expectations communicated in the Annual Report 2016.

The online advertising outlook in Germany and Europe further remains positive, as both consumers and customers become increasingly digital. Scout24 is well positioned to benefit from this structural shift due to the market leading positions of our ImmobilienScout24 and AutoScout24 platforms, as well as with our consumer monetization initiatives along both value chains.

The Management is confident that this momentum will continue in the second half of 2017, and expects Group revenues to record a high single-digit growth rate for the full year 2017. Reflecting the scalable nature of the business model, the total cost base should grow at a disproportionately lower rate than revenues and therefore the Management continues to expect the ordinary operating EBITDA-margin - adjusted for seasonality - for the full year 2017 to increase by around one percentage point compared to full year 2016 (50.8%).

In the first half of 2017, IS24 achieved a revenue growth of 4.6% yielding an ordinary operating EBITDA-margin of 62.4%, which is fully in line with expectations. The Management's outlook for the full year forecasts a stronger growth in revenues in the second half of 2017, and expects ordinary operating EBITDA-margin for the full year to come in slightly lower or in line with the full year 2016 margin (63.0%), but of minimum at 61.5% (versus at a minimum of 61.0%, as previously forecasted).

Revenues within AS24 increased by 15.1% in the first half year of 2017 (Q2 2017: 15.2%). For the second half year 2017, the Management remains confident of AS24's ability to grow revenues and expects full year 2017 revenue growth at a mid-teens percentage rate. Ordinary operating EBITDA-margin for the first half-year 2017 stood at 47.3%, an increase of five percentage points compared to the full year 2016 (42.3%), which underlines Management's expectations to expand ordinary operating EBITDA margin by at least five percentage points for the full year 2017.

The Management expects non-operating costs to amount to approximately EUR 14.5 million for the full year 2017, approximatively EUR 4.5 million higher than previously guided for. This is mainly resulting from a non-recurring charge for reorganisation of around EUR 6.5 million (previously EUR 4.0 million) and from costs relating to M&A activities of around EUR 2.0 million (previously not expected). Finally, Management expects capital expenditure to be on a comparable level to 2016, as previously forecasted.

Conference Call

On Wednesday, 9 August 2017, 1:00 p.m. CEST, 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://scout090817-live.audio-webcast.com

Next reporting
Scout24 expects to report results for the first nine months of the 2017 financial year on Wednesday, 8 November 2017.

On 14 November 2017, the first Capital Markets Day of Scout 24 AG will take place in Berlin.

About Scout24

With our leading digital marketplaces ImmobilienScout24 and AutoScout24 in Germany and across Europe we are inspiring people to make their best decisions on finding a home and a car. More than 1,000 employees are working on the success of our products and services, putting the consumers' needs first in order to create a connected network for living and mobility. Scout24 is listed on the Frankfurt Stock Exchange (ISIN: DE000A12DM80, G24). For further information, please visit http://www.scout24.com/, our Corporate Blog and Tech Blog, or follow us on Twitter and LinkedIn.

Investor Relations

Britta Schmidt
Vice President Investor Relations & Treasury
Tel: +49 89 44456 3278
Email: [email protected]

Media Relations

Marie Fabiunke
Director Corporate Communications & PR
Tel: +49 30 24301 1427
Email: [email protected]

Disclaimer:

All information contained in this document 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 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.

Scout24 also uses alternative performance measures, not defined by IFRS, to describe the Scout24 Group's results of operations. These should not be viewed in isolation, but treated as supplementary information. The special items used to calculate some alternative performance measures arise from the integration of acquired businesses, restructuring measures, impairments, gains or losses resulting from divestitures and sales of shareholdings, and other material expenses and income that generally do not arise in conjunction with Scout24's ordinary business activities. Alternative performance measures used by Scout24 are defined in the "Glossary" section of Scout24's Annual Report 2016 which is available at www.scout24.com/financial-reports.

Due to rounding, numbers presented throughout this statement may not add up precisely to the totals indicated, and percentages may not precisely reflect the absolute figures for the same reason.