Baltic Classifieds Group PLC (LON:BCG), the leading online classifieds group in the Baltics, has announced full year results for the year ended 30 April 2024.
Key highlights
· 2024 marked another year of delivering strong performance across all our businesses lines, underpinned by our significant leadership position1 versus competitors, record high individual advertising volumes, and a growing customer base across key verticals.
· Revenue grew 19% to €72.1 million (2023: €60.8 million). Core classifieds revenue streams B2C and C2C, which together comprise 90% of total revenue, grew 22% and 18% respectively.
· EBITDA2 grew 20% to €55.3 million (2023: €46.0 million). Our EBITDA margin2 expanded by 1% pt to 77% (2023: 76%). Accounting operating profit grew 32% to €38.3 million (2023: €29.1 million).
· Adjusted basic EPS2 grew 20% to 9.2 € cents (2023: 7.7 € cents) while basic EPS grew 40% to 6.5 € cents (2023: 4.7 € cents).
· Adjusted net income2 grew 18% to €45.0 million (2023: €38.0 million) with adjustments to profitability being the amortisation of acquired intangibles, the corresponding tax impact and a one-off tax credit relating to 2021. Profit for the period grew 38% to €32.0 million (2023: €23.2 million).
· Cash generated from operating activities grew 23% to €59.0 million (2023: €48.0 million), with cash conversion2 maintained at 99% (2023: 99%).
· Voluntary repayment of €20 million of debt, to end the year with a gross loan balance of €50.0 million (2023: €70.0 million). Net debt2 reduced to €27.5 million (2023: €45.3 million), with a year-end Net debt / EBITDA of 0.5x (2023: 1.0x).
· Clear capital allocation framework, with €32.6 million returned to shareholders by way of share buybacks (€19.3 million) and dividends (€13.3 million) (2023: €16.7 million returned to shareholders).
· The Board has proposed a final dividend of 2.1 € cents per share (1.7 € cents per share in 2023). If approved, the total dividends for the year will be 3.1 € cents per share.
Financial highlights
| €m (unless stated otherwise) | 2024 | 2023 | Change |
| Auto | 27.5 | 22.2 | 24% |
| Real Estate | 18.0 | 15.0 | 20% |
| Jobs & Services | 13.8 | 11.8 | 17% |
| Generalist | 12.6 | 11.7 | 8% |
| Group revenue | 72.1 | 60.8 | 19% |
| Operating cost excluding depreciation and amortisation | (16.8) | (14.8) | 14% |
| EBITDA2 | 55.3 | 46.0 | 20% |
| EBITDA margin2 | 77% | 76% | 1% pt |
| Depreciation and amortisation | (16.9) | (17.0) | (0%) |
| Operating profit | 38.3 | 29.1 | 32% |
| Add back: amortisation of acquired intangibles | 16.2 | 16.2 | 0% |
| Adjusted Operating profit2 | 54.5 | 45.3 | 21% |
| Profit for the period | 32.0 | 23.2 | 38% |
| Adjusted net income2 | 45.0 | 38.0 | 18% |
| Basic EPS (€ cents) | 6.5 | 4.7 | 40% |
| Adjusted basic EPS2 (€ cents) | 9.2 | 7.7 | 20% |
Operational highlights
· We maintained our significant leadership position over our nearest competitor across all our largest sites: Autoplius.lt at 7x (6x in 2023), Auto24.ee at 36x (29x in 2023), Aruodas.lt at 17x (21x in 2023), KV.ee plus City24.ee in Estonia at 19x (16x in 2023), CVBankas.lt at 7x (9x in 2023) and Skelbiu.lt at 23x (19x in 2023).
· At the start of the financial year, we implemented C2C pricing and packaging changes across all business units, which combined with rising market prices of the goods and services advertised on our sites, have resulted in increased yields3 in all business lines. It is worth noting that the yield per active ad is arithmetically diluted due to ads staying on the site for longer durations. Yields growth per active ad were: 0% in Auto4 and Real Estate, 11% in Services. In Generalist5 revenue per listing grew 3%.
· In September and October 2023, we implemented our annual B2C pricing actions in Auto and Real Estate, accompanied by enhancements in products and packaging. In Jobs6 this commenced in September 2023 and is ongoing over the 12 months period.
· The changes to our B2C packages and prices led to increased ARPU3 in all verticals: Auto by 26%, Real Estate by 22% and Jobs by 7%. Also, this year more business customers used our platforms across all verticals: Auto dealers increased by 4%, Real Estate brokers by 1%, and Jobs customers by 5%.
· Traffic to our sites averaged 56.0 million visits per month, meaning that on average, a resident in the Baltics visited one of our sites 10 times every month.
· During 2024, we introduced a number of improvements to our products and services, including:
· Auto: On Autoplius, we launched a rating system for top-tier car dealers. This system allows them to ask for feedback from car buyers providing them an opportunity to build trust and competitive advantage. The ratings encourage dealers to improve the car buying experience and assist buyers in making better choices.
· Real estate: In Estonia, we introduced a new product for the property rental market which allows landlords and tenants to execute rental contracts through our platform, benefiting both parties. Background checks are done on potential tenants helping landlords to make informed decisions. Tenants receive a balanced rental agreement, 24/7 emergency service, insurance for property damage, and rental payment protection in case of inability to pay.
· Jobs and Services: On GetaPro, we improved content quality by encouraging service providers to add more information to their profiles and to collect more feedback, helping them achieve higher listing positions.
· Generalist: On Osta, we launched a parcel self-service platform that aggregates the most popular parcel delivery providers. This tool is not limited to Osta users and can be used to send items sold on any marketplace.
· We also saw unprecented growth in the individual advertising volumes on our verticals as numbers of C2C active ads in Auto were up 26%, in Real Estate up 20% and in Services up 32%. Listings on our Generalist platform also grew 5%.
· The Estonian Competition Authority (“ECA”) terminated its investigations into our Real Estate and Auto platforms. During the supervision procedure, the ECA came to the conclusion that KV.ee, City24.ee and Auto24.ee “have not set unfairly high prices for the services they offer”.
· The number of BCG employees during the 2024 grew to 140 FTEs (end of 2023: 134 FTEs). At the end of the period the split of women to men was 50:50.
· We have reduced our absolute Scope 1 and 2 emissions by 70% from a 2022 base year and achieved our goal of having at least 80% of used electricity derived from renewable energy sources by 2025 by increasing the portion of electricity derived from renewable sources from 63% in 2022 to 88%. We are working toward our net zero target and as part of our net zero journey we reported our Scope 3 carbon emissions for the first time.
Justinas Šimkus, Chief Executive Officer of Baltic Classifieds Group, said:
“2024 marked another year of solid financial, operational and strategic execution for BCG, with strong momentum observed across each of our business segments. We are in the early stages of our monetisation journey, which underpins the resilience of our top line and EBITDA growth, and, we are particularly pleased that our operational leverage is once again flowing through to our EBITDA margin now that public listed company costs have been normalised.
Our platforms have established themselves as a key destination for those looking for transactions in automotive, real estate, jobs, services and general merchandise. The attractive business environment in which we operate – part of the EU, the euro area and NATO – enhances our prospects for further success and expansion. And the fact that we are based in Lithuania, a country which, based on the World Happiness Report, is renowned for having the happiest young people in the world reflects the joy we have in running this company.
I would like to thank all of my colleagues for their efforts over the last 12 months. The results of our recent employee engagement survey reaffirm our belief that the team’s motivation is at an all-time high, with over 95% of employees expressing pride in being part of BCG and would recommend it as a great place to work.”
Outlook
· The Board is guiding to 15% revenue growth in 2025, with Auto, Real Estate and Jobs & Services expected to grow marginally ahead of this number and Generalists below the overall Group average. The growth will be driven by B2C ARPU and C2C yield expansion, expecting inventory levels to remain similar to those we have seen this year.
· Going forward, the Board expects continued marginal EBITDA margin expansion including continued investment in product development.
· The Board remains committed to the existing capital allocation policy which remains focused on allocating excess cash towards reducing gross debt and the share buyback programme, particularly in the absence of M&A opportunities.
1 Leadership position based on time on site except for Auto24. Auto24 has no significant vertical competitor; next relevant player is Generalist portal; therefore, relative market share is calculated based on time on site proportion relating to the number of active automotive listings as at the end of the reported period.
2 Alternative performance measure, see note 3 for further details
3 Yield refers to the average monthly revenue per active (Auto, Real Estate or Services) or listed (Generalist) C2C listing or ARPU in B2C. ARPU is monthly average revenue per user (in Auto – per dealer, in Real Estate – per broker, in Jobs – per client).
4 Car listings only (excluding listings of vehicle parts, vehicles other than cars and other categories).
5 Skelbiu.lt only.
6 CVbankas.lt
