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iProperty Group Ltd shares surge 8%: Here’s what you need to know

What? Shares in Asian real-estate website operator iProperty Group Ltd (ASX: IPP) jumped 8% on Tuesday morning after the company announced another quarter of spectacular growth.

iProperty reported its highest ever quarterly billings of almost $8 million for Q4 2014, up 57% from Q3 and 29% from Q4 2013. Receipts for the quarter were lower, following a slower Q3, however payments to suppliers and employees remained constant, leading to a negative net operating cashflow of just $55,000.

So what? The quarterly result represents an important milestone for the company – the highest quarterly revenue and highest earnings before interest, tax, depreciation and amortisation of approximately $700,000.

Revenue grew by 40% on the previous quarter and 25% on the same quarter last year. Unique visitors to iProperty Group sites exceeded 3.5m per month and exceptional growth in listings and visitors was seen in the company’s main markets of Malaysia, Hong Kong and Indonesia. These pleasing results were all achieved in parallel to the successful rollout of price increases that had minimal impact on listings.

What now? iProperty didn’t provide any predictions about the full-year result, however the implementation of price increases with minimal disruption is particularly pleasing going forward. Management will need to find the perfect balance between providing value and charging excessive fees. The presence of REA Group Limited’s (ASX: REA) expertise is obvious, with depth listings and innovative solutions working their way into iProperty’s presentation.

I would like to see a little more care placed in the media releases, however if there are cost savings involved in grammatical errors and poor formatting then perhaps it’s for the best! Interestingly the same issues were experienced in the release from sister-company iCar Asia Ltd (ASX: ICQ).

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Motley Fool contributor Andrew Mudie owns shares in iCar. You can find Andrew on Twitter @andrewmudie

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