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Report on Financial Analysis - Zoopla Plc

   

Added on  2020-06-05

14 Pages2723 Words36 Views
Financial analysis

Table of ContentsINTRODUCTION...........................................................................................................................1FINANCIAL ANALYSIS...............................................................................................................1Profitability analysis....................................................................................................................1Liquidity performance..................................................................................................................4Assets utilization ratio..................................................................................................................5Gearing ratio................................................................................................................................6Stock market performance analysis.............................................................................................7CONCLUSION................................................................................................................................8REFERENCES..............................................................................................................................10APPENDIX....................................................................................................................................12Table of FiguresFigure 1 Profitability performance of Zoopla Plc and Rightmove Plc............................................1Figure 2 Segmental revenue of Zoopla in FY 2016........................................................................3Figure 3 Current ratio of Zoopla Plc................................................................................................4Figure 4 Assets utilization ratio of Zoopla Plc and Rightmove Plc................................................5Figure 5 Capital structure of Zoopla Plc and Rightmove Plc..........................................................6Figure 6 Earnings per share and Dividend per Share of Zoopla Plc and Right move Plc...............7Figure 7 Share price comparison of Zoopla Plc and Rightmove Plc...............................................8

INTRODUCTION In today’s competitive world, every organization keep continuous track over theirbusiness financing activities to determine their performance and suitability. Companies just notonly need to examine their own performance but also need to examine competitor’s behavior,strategies, actions and performance. UK Real Estate industry is a major contributor to theeconomy as it contributes £94 billion and employs 1 million people in the sector (About RealEstate, 2016). Zoopla Plc is a public limited company that provides information about propertyprices, area, value estimates and other required information on it search engine. Its performancewill be compare with Rightmove Plc, which is UK’s biggest online property website and realestate portal. Both the companies are listed on LSE and a constituent of FTSE 250 Index. Theresearch will analyze and compare the financial results of the companies using ratio analysistechnique. FINANCIAL ANALYSISProfitability analysis0.00%10.00%20.00%30.00%40.00%50.00%60.00%70.00%80.00%Profitability performanceOperating profit margin Net profit marginFigure 1 Profitability performance of Zoopla Plc and Rightmove Plc1 | P a g e

In FY 2016, Zoopla Plc’s revenue grows up from £107.5m to £197.7m by 83.84% awith58% increase in adjusted EBITDA to £77.1m. The year shows progressive result because in thisyear, company had purchased one of the leading software and workflow solution providers,Property Software Group that is used in its 8000 offices all around the marketplace. It enablefirm to deliver end-to-end solution including digital marketing, CRM, software and others.Moreover, property partners helped business to maximize revenue. Increasing the scale ofoperations helps both the customers and the business partners throughout the property lifecycle(Jorgensen ,Lee and Rock, 2014). Moreover, its comparison services outperformed and deliverexceptional results as revenue has been increased by 38% to £111.0m this year. Despite this, ithad also maximized its revenue stream by MoveIT and development of USwitch energy thatdrive efficiency. MoveIT significantly contributes towards the business performance, as withinjust one month, it generated revenue of more than £9000 (Zoopla Plc’s annual report, 2016). Although, Brexit bring uncertainty however, Comparison website division did notaffected by it and in such tough time, the success majorly dependent upon suppliers competition.Its Property Service Division audience shows year on year growth of 2% with 45 million visiteach month to the platform. It noticed a considerable growth in the number of agency partners inUK placing advertisement on Zoopla’s portal as it goes up by 5% with total 13,373 in addition tothe 1074 overseas agents, 5003 software partners, 2610 new homes development and 415commercial agents. Its annual financial report published average revenue per partner (ARPP) to£328. 2016UK Agency 64257New Homes 11736Other property services 10757Energy52659Communication44137Other comparison services 141821977282 | P a g e

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