Singapore’s PropertyGuru remains in the red despite the increase in sales in the fourth quarter

  • PropertyGuru posted a net loss of $5 million Singapore dollars ($3.7 million), while revenue improved 17% in Q4 2022.
  • The company cited challenges such as rising interest rates, government credit intervention in Vietnam and remaining political uncertainty in Malaysia.
  • “I think the stock will face some challenges in the near term, especially with the cooling measures from governments in the Southeast Asian region, but I think it will see a major turnaround once PropertyGuru shows the first signs of a trajectory to positive net profit after tax,” said Maximilian Koeswoyo, research analyst at Phillip Securities.

Singapore-based online property portal PropertyGuru maintains a “conservative outlook in 2023” amid challenges, expecting full-year 2023 revenue between SG$160 million and SG$170 million and adjusted EBITDA between SG$11 million and SG $15 million.

Wei Ling Tay | Bloomberg | Getty Images

SINGAPORE – Singapore’s online real estate portal PropertyGuru posted 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 key markets, tightens lending for real estate.

The net loss for the three months to December 2022 was SG$5.2 million. That’s almost 30% improvement over net loss of SG$7.4 million in the previous quarter.

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

The company has not posted a full year’s profit since its launch in 2007. It currently dominates the Southeast Asian market.

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

Meanwhile, fourth-quarter revenue was SG$40 million, about 17% more than a year ago. Annual sales increased 35% to SG$136 million.

Shares of PropertyGuru closed 1.68% higher on Wednesday.

Macro and fiscal policy uncertainty continues to test our clients.

Harry Krishnan

CEO, PropertyGuru

“Increased product adoption, improved pricing and the continued integration of the iProperty acquisition all helped offset challenging market decisions. That said, macro and fiscal policy uncertainty continues to test our clients,” said Hari Krishnan, CEO and general manager of PropertyGuru, on Wednesday’s earnings call.

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

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

Krishnan said higher borrowing costs and uncertainty surrounding Malaysia’s national elections in November impacted sales, while the Singapore market remained resilient. In Vietnam, the government continued to tighten credit to control debt levels, resulting in a decline of real estate listing.

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

“PropertyGuru is definitely still in a growth phase as it continues to actively pursue further M&A opportunities and focuses on how it can provide a more complete service offering on its platform,” Koeswoyo told CNBC in an email. .

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

See chart…

PropertyGuru’s stock performance

“I think the stock will face some challenges in the near term, especially with the cooling measures from governments in the Southeast Asian region, but I think it will see a major turnaround once PropertyGuru shows the first signs of a trajectory to positive net profit after tax’, says Koeswoyo.

PropertyGuru expects the integration and scaling of the Sendhelper acquisition “to negatively impact profitability from SG$3 million to SG$4 million in 2023,” according to the press release.

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 entry into the market.

The online real estate portal maintains a “conservative outlook in 2023” amid challenges, expecting full-year 2023 revenue between SG$160 million and SG$170 million and adjusted EBITDA between SG$11 million and SG$15 million, said it in the release.

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

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