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Baltic Classifieds Group PLC on Thursday warned lower revenue growth and continued investment will depress margins in the short-term after reporting mixed first half earnings. In response, shares in the online classified ads portal provider in Lithuania, Estonia and Latvia slumped 19% to 178.80 pence each in London on Thursday morning. They had earlier traded as low as 168.00p. Pretax profit rose 22% to €30.5 million in the six months to October 31 from €25.0 million the year prior, as revenue grew 7.2% to €44.8 million from €41.8 million. Sales growth was held back by faster selling times and the corresponding downward pressure on advertising inventory, especially compared to the record levels achieved a year ago, the firm said. In addition, Estonian auto transactions were down by half as a result of tax changes. Overall auto sales were flat on-year, Real Estate grew 20%, Jobs & Services rose 7% and Generalist increased 4%. ‘Aside from the tax-affected Estonian Auto segment, we delivered strong double-digit revenue growth, with our core revenue streams - B2C and C2C - up 15% and 8% respectively. This performance was driven in particular by another outstanding year in our Real Estate business, marking its second consecutive year of exceptional results,’ said Chief Executive Justinas Simkus. Despite record inventory comparables, and challenges in the Estonian auto market, the firm expects revenue growth for the second half of the financial year will be above that of the first half and will accelerate into double digits for financial 2027. Real Estate and Auto are expected to lead this growth. Jobs & Services and Generalists are expected to grow at a more moderate pace. Nonetheless, Baltic Classifieds said lower revenue growth and continued investment means some earnings before interest, tax, depreciation and amortisation margin compression is ‘inevitable’, although it expects Ebitda margin to continue in the mid-seventies. In the first half of the financial year, Baltic Classifieds reported an Ebitda margin of 78%, down from 79% a year ago. An interim dividend of 1.3 euro cents per share was declared, up 7.6% from 1.2 cents a year ago. ‘We intend to continue to return meaningfully all our excess cash to shareholders in a timely manner, of which at least one third will be through dividends. We could be debt free by the end of the financial year, so shareholders can expect an update on capital policy by the time of our full year results,’ the firm added. Copyright 2025 Alliance News Ltd. All Rights Reserved.
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