Singapore-based prop-tech firm PropertyGuru has returned to the black by achieving a net profit of SGD 300,000 ($224,022) in the third quarter ended September 30, 2023, as compared to a net loss of SGD 7 million ($5.23 million) a year ago.
PropertyGuru said in a statement on Tuesday that its total revenues grew 13 percent year on year to SGD 39 million ($29.12 million) in the third quarter, as total revenues ex-Vietnam grew 23 percent.
Active cost management drove 69 percent of incremental year over year revenue into adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA).
The group’s adjusted EBITDA also grew to SGD 5 million ($3.73 million) in the third quarter, up from SGD 2 million ($1.49 million) a year earlier.
On the outlook, the firm said Vietnam’s property market continues to be affected by government policy interventions that negatively impact consumer sentiment and transaction volumes.
As a result, the company now projects full year 2023 revenue to be between SGD 148 million ($110.52 million) and SGD 152 million ($113.5 million).
Active cost control measures have also helped the company reaffirm full year 2023 adjusted EBITDA of between SGD 11 million ($8.21 million) and SGD 15 million ($11.2 million).
In the short term, the firm said its results may be influenced by several factors outside of its control.
These factors include the aforementioned issues in Vietnam and Malaysia as well as property taxation and stamp duty increases in Singapore and a lack of clarity in global fiscal policy stemming from rising interest rates, greater inflationary pressures, and global supply chain complications impacting our customers.
Longer-term, the company remains bullish on its growth trajectory, prospects for improving profitability, and the fundamental opportunity that exists in our core markets.
“I am pleased that we delivered another quarter of good performance despite diverse market challenges,
According to him, as the firm’s transition from 2023 to 2024, it continues to see opportunity despite ongoing global economic uncertainty.
“Our unwavering commitment to helping people make informed property ownership decisions and assisting businesses in harnessing data and technology for growth and efficiency sets us up well to increase market share and develop categories ahead of the cyclic economic recovery,” he said.
He also said the firm continues to invest in property technology and integrating Generative AI.
He revealed that pioneering solutions that provide an agent clarity on the leads they are nurturing or a property seeker personalized feeds using GuruPicks have received good customer adoption.
He said the firm’s innovative solutions that shipped provided climate risk driven valuation data through DataSense, and holistic homeowner solutions to help home financing and management,
He also said positive customer feedback sets them up well while their multi-pronged strategy should build significant moats for the core business.
“For instance, the timing of Vietnam’s property market stabilization remains uncertain, prompting us to be laser focused on our company-wide investments as we await greater clarity in 2024,” he said.
He also believes in the fundamental opportunities in the firm’s core markets and remain committed to future growth and profitability anchored around its vision to power communities to live, work, and thrive in tomorrow’s cities.
Meanwhile, PropertyGuru Chief Financial Officer Joe Dische said that the firm delivered 13 percent overall revenue growth in the third quarter despite challenging market conditions in Vietnam.
“Excluding Vietnam, revenues were up a solid 23 percent. The reported revenue for Malaysia was adversely impacted by depreciation of the local currency, he said.
Beyond the firm’s double-digit growth this quarter in the face of a challenging environment, he said the management is especially encouraged that their cost control efforts continue to yield measurable results.
“Our Adjusted EBITDA margin of 13 percent is a strong improvement from 6 percent in the third quarter of 2022. This is the second quarter in a row that we achieved a double-digit,
“Adjusted EBITDA margin, with all of our Marketplaces delivering a profit. In addition, both net income in the third quarter and year-to-date cash flow were positive,” he added.
He said the firm is focused on delivering ongoing improvements in operating leverage through technology, automation, machine learning and prudent cost management.
He said the firm’s objective is to deliver sustained increases in adjusted EBITDA margin.
“A recovery in Vietnam’s property market is not expected in 2023. Combined with macro-economic and exchange rate challenges in Malaysia, we are lowering our 2023 revenue outlook to SGD 148 million ($110.52 million) to SGD 152 million ($113.5 million),
“Through effective expense management, our 2023 Adjusted EBITDA outlook remains unchanged at SGD 11 million ($8.21 million) to SGD 15 million ($11.2 million),” he added.
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