Rightmove has this morning told its shareholders it is “taking appropriate measures” to shore up the company.
It gives no indication of what those measures are but it says in a trading statement released at 7am today: “In this period of unprecedented uncertainty, we are unable to quantify the impact of COVID-19 on our financial and trading performance at this stage. Accordingly, the group is suspending all existing financial guidance for 2020. The board is confident that the company has the financial capacity to withstand this challenging period.”
It has scrapped a dividend to shareholders and suspended financial guidance on how the firm will perform this year.
Shareholders were to have received a final dividend payment of 4.4p per share for the year ending December 31 but in the light of the Coronavirus crisis, that has been stopped.
In a bid to pacify those with a stake in the company, Rightmove has told them: “The board recognises the importance of the dividend to our shareholders and will consider the timing of the reinstatement of the share buyback programme and the quantum of any interim dividend for 2020 in due course.”
It goes on to say: “The strength of our balance sheet and business model has enabled the board to act quickly to support our customers [the offer to agents] as announced on 20 March.”
A week ago today Rightmove revealed it would slash its charges to agents by 75 per cent for four months.
The portal also apologised for getting it so badly wrong with its deferred payment scheme, which was derided by customers - many of which left the portal in disgust.
A statement from Rightmove to agents at the time said: “I don’t think many of us would have predicted sitting in our offices last week that we’d be where we are today, with the possibility of more restrictive measures approaching. Earlier this week we offered our independent estate and lettings agents a deferred payment scheme to help them through the next few months. The situation in the UK has changed rapidly and we’re sorry that it was too little and now inappropriate for the challenges we all face."
The portal went on to say a week ago: “Instead of offering the deferred payment scheme to independent estate and lettings agents, we're going to reduce your Rightmove bill by 75% for four months, starting from 1st April whether you advertise residential properties, new homes or commercial premises. You don’t need to apply for this discount, your invoice will automatically come through reduced by 75%. To be clear, this is not a deferred payment, this is a discount that you don’t need to pay back.
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rightmove made the rightmove in the end but it remains to be seen how damaging the initial wrong move is to their business - time will tell and also will depend on further moves as crisis evolves
I’m no tub thumper for Rightmove by any means. I’ve been very critical in the past, but if you make a mistake and quickly realise and act then I’ll give respect where due. They’ve now resolved it with something better than they would likely have committed to at the off set. It’s hard to judge “take 2” negatively.
'It’s hard to judge “take 2” negatively.'
It's very easy actually particularly if you've followed this company since 2000.
They only came back with the revised offer because they quite rightly got worried...it wasn't done for the right reason to help customers out. I still suspect that they will make moves at some point in the future to hike the fees back up The reduced rate of circa £400 is what it should be all the time never mind just a few months
To all fellow business owners;
This is your chance to knock these (Rightmove) shysters off their self elevated podium. They (Rightmove) have ripped us off now for years and years. Rightmove have this year increased their fees by nearly 10% for no other justification apart from corporate greed and the FACT that they have us business owners over a barrel.
They (Rightmove) have their own greed to blame that they have got this so badly wrong!!
I urge ALL business owners NOT to take their 75% discounted deal and not pay them (Rightmove) at all.
To OTM and Zoopla; learn but Rightmove’s mistake; don’t take your market for granted!! Our industry is now in tatters, we are looking at 3 months plus of no money. Completions and move-ins are urged to be delayed. The answer is simple; don’t be greedy!!
My message in short; cancel your direct debits fellow business owners and make these corporate muggers go bust. This is the best chance we have been waiting for for years!
"not pay them (Rightmove) at all."
Businesses have contracts, breaking a contract is not advice which should be offered.
At a time like this, agents need to put aside how they may feel for any particular portal, and just focus on what is best for there own business to survive and come through this and the months / year ahead. Emotion not business sense, can be extremely damaging.
Rightmove has got it all wrong and now the trust has gone where does that leave everyone?
In the past week I have had communication with or from over 500 property professionals, CEO’s, sole traders, men and women in the front line of the business, tech companies, other analysts, you name them I have been talking with them. As many know I have for some time said that the real estate relationship with Rightmove has become a toxic, abusive and one sided, and that a major fault line was pushing the two parties wider and wider apart.
For sure since 2006 when Rightmove became a quoted stock, the share price had until a few weeks ago rocketed by 1,500%, and in February 2020 hit 691p a share, but now at 470p a share with a likely revenue hit of 75M plus, shareholders and the c-suite of Rightmove might realise that the gravy train has just hit the buffers.
Many that I spoke to say that with over 130M visits a month to the Rightmove website, the brand strength and the public’s pre-occupation with ‘Property Porn’ means that as the Property Portal heavyweight, nothing can stop it. Well Covid-19 just has, faced with a long journey ahead agents looking at their fixed cost model of agency, suspiciously eye the large ticket cost of Rightmove, often in the top three of a branches costs after salaries.
Agents now realise that with the proliferation of ‘free to list’ portals, their £1,100 plus as an average branch spend, is in fact nowhere near its true price point. The other thing that everyone talking to me says is ‘Rightmove has itself never moved’ in that it has no evolved, it is just digital shelves rammed with goods/listings supplied by the agents.
How will it end? Well in January 2016 the share price was 402p, and in the following years it was 390p, 450p,474p and in 2020 642p (peaking at 691p a month later) so an adjustment to 470p was likely at some time in 2020 anayway. Now though – agents are going to leave Rightmove, and those that stay are not going to want to pay anywhere near £1,100 a branch.
Luckily I am neither a shareholder or in the Rightmove c-suite, but if I was on the management team the first thing I would do is what I do … listen and engender debate, find out what your customer wants and needs and provide it – do not put your fingers in your ears and keep putting up the prices. Or people like Kristjan Byfield who is the kindest and gentlest and most considerate and well respected property and proptech professional will give you your P45.
Amen brother! Well said
Get your notice in by 31st March then you'll be totally free by 30th April.
If you don't do it now, you never will.
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