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Domain (ASX:DHG) share price tumbles 8% lower on AGM update

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The Domain Holdings Australia Ltd (ASX: DHG) share price has come under pressure on Tuesday following the release of its annual general meeting presentation.

At the time of writing, the property listings company’s shares are down 8% to $4.26.

What was in Domain’s annual general meeting update?

As well as providing a summary on its performance in FY 2020, the company also gave investors an idea of how it has been performing in the new financial year.

According to the release, trading year-to-date in FY 2021 (1 July to 31 October 2020) has improved since the fourth quarter of FY 2020. This is despite the impact of the COVID-related lockdown in Victoria.

Domain revealed that its Digital revenue is up around 4% year to date. However, due to the pause on print during the Victorian lockdown, the company’s total revenue is 7% lower compared to the prior corresponding period.

What about the rest of the half?

Management pointed out that it highlighted in August that the outlook for the first half would be determined by the duration of the Victorian lockdown and a return of more typical seasonality patterns for the Spring selling season.

And while the lockdown has now eased, it notes that seasonal patterns remain atypical, with a stronger performance in July, and a less pronounced peak in October.

In light of this, the company hasn’t provided any sales or earnings guidance for the first half.

It has, however, provided guidance on its costs. For the first half, its total costs (adjusted for divestments) are expected to reduce by around 12% from the FY 2020 first half base of $96.5 million.

This includes the benefits from the Federal Government’s Jobkeeper scheme and the company’s Project Zipline employee program. Excluding these two items, first half costs are expected to reduce by a more modest 1%.

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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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