Shares in Trade Me dropped after their first full-year report as annual sales growth lagged, offering a ‘muted’ comments regarding future trading.
The online auction website yesterday reported profits of $75.6m, while confirming end of year targets were also on schedule.
Yet stock in the company dropped 2.5% to $3.87 as it failed to beat analyst revenue forecasts of $146m, posting $142.5m for the country’s most visited website.
After reporting profits of $75.6m, Trade Me says full-year profit rose 8.4% along with a sales increase of 13.8% which could not prevent a stock fall in New Zealand’s current ‘fragile’ market.
The Wellington-based company remains ‘confident about the prospects of our business and its foundations’ in the longer term, however, with CEO Jon Macdonald noting shares have climbed since their NZX debut in December.
With a predicted revenue forecast of $79.9m for six months ending December 31, Trade Me says it remains ‘committed to delivering’ on those forecasts.
The financial findings showed general items predictably performed strongly, with an 8% increase in mobile phone trading through the development of smartphone applications.
Trade Me’s classified businesses including Trade Me Motors, Trade Me Property and Trade Me jobs also performed strongly, with the site set to pay a dividend of 7.8 cents per share on September 25.
"Our core 'general items' marketplace performed in line with our expectations," he says.
"Growth in mobile, online retail, and the migration of advertising yield online all provide excellent opportunities for Trade Me over the coming years."
"Throughout the year, we've also seen the proportion of fixed price transactions continue to grow as buyers move towards new goods and instant ecommerce experience."
"In the longer term, we're confident about the prospects of our business and its foundations.”
In a separate announcement, Trade me acquired cloud-based inventory management tool Tradevine, providing users with a base to manage sales, inventory and listings.
"We see it as another piece of the puzzle to provide an effective marketplace,” Macdonald says.
"It will help overall new good growth."
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