The Domain Holdings Australia Ltd (ASX: DHG) share price is in the negative territory today, after the company provided the market with its half-year results for FY21.
In response to the numbers, shareholders sold off the property technology and services business as much as 7.4% on open, down to $4.92. The Domain share price has since bounced back to $5.06 at the time of writing.
So, what has shareholders selling on today's results? Let's take a look.
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Impacted revenues weighing on the Domain share price
For the first half of FY21, Domain reported revenues of $137 million. This result is down 5.5% from the previous corresponding period on a like-for-like basis. However, Domain managed to reduce expenses year-over-year by 9.9% to $82.5 million – resulting in the company delivering improved earnings before interest, tax, depreciation and amortisation (EBITDA). Consequently, Domain increased net profit by 52.2% to $19.4 million for half.
Shareholders may have been disappointed that Domain has deferred consideration of a dividend until full-year results. The rationale behind this decision is the on-going uncertainty generated by COVID-19.
Interestingly, it appears Domain's revenue for the half was heavily impacted by the reduction in its print business segment. Print revenue fell 65% to $6.2 million for the half – a result of printing being paused during COVID-19 lockdowns.
Constrained property listings also weighed on the group's print revenues.
Forward outlook
Management remains optimistic, with several promising indicators of growth for the half-year ahead. As an example, Domain reportedly continues to see atypical seasonal patterns, particularly demonstrated by listing strength in Melbourne.
In the presentation, the company also points out a growing demand/interest in property listings compared to the same time last year.
However, it was noted that total costs are expected to increase for the full year by a mid-to-high single-digit percentage. The second half will bear the brunt of the Jobkeeper scheme ending, which benefitted Domain through the last 2 halves.
At the time of writing, the Domain share price is down 4.25% in today's trade, but is up 11% year-to-date.
