Rightmove sees continued growth in uncertain market

LONDON (Reuters) - Rightmove, Britain's most visited property website, posted 40 percent higher first-half profit, beating analysts' expectations, as more homebuyers and sellers used its site to navigate a challenging market.

The company reported underlying operating profit of 27.9 million pounds on 26 percent higher revenue of 42.3 million, helped by estate agent customers spending more to raise their profiles on its web pages.

Traffic on its site rose 22 percent to 3.9 billion page impressions, with March being its highest month ever and April recording its busiest day, Rightmove said on Friday. The company said trading in July and August was in line with the first half, giving it confidence that revenue would continue to rise, despite an uncertain outlook for the housing market.

Rightmove said earlier this month house prices were falling 1.7 percent month-on-month in England and Wales.

Managing Director Ed Williams said the company was not seeing a big impact from a slowdown in the market, with August set to be its second busiest month.

"We are not seeing any change in the number of our customers going out of business," he told reporters.

"Anecdotally people are saying it's slow ... This is always a really hard time of year to call the market. We are cautious but we are not yet sharing the gloom that seems to be more widespread in the City and marketplace."

Rightmove was attracting more advertising spend from estate agents at the expense of local newspapers, he said.

It had also raised prices in the first half, and was selling more services, such as more prominent visibility for agents in its search results.

"We do not believe that such an outlook (for the housing market) need be materially affected by flat or modest falls in house prices, provided that transaction volumes do not take a sharp downward turn and cause our customers to cease trading," the company said.

Shares in the group were 1.3 percent higher at 630.5 pence by 10:50 a.m., outperforming a 0.3 percent stronger index of mid-sized companies.

Numis said it was a strong set of interim results, with profit beating its 25.2 million pounds estimate.

The broker said Rightmove's "excellent operational progress (was) demonstrating the strength of the group's business," and raised its price target to 782 pence.

Analysts were expecting underlying operating profit of 25.9 million pounds on revenue of 41.0 million pounds, according to a Thomson Reuters I/B/E/S survey of three brokers.

(Editing by Mark Potter)