Trade Me looks to expand in classified ads

Trade Me, the online auction site spun out of Fairfax Media in 2011, is in the market for more acquisitions and may extend its $200 million bank loan. The Wellington-based company made three purchases last year - the holidayhomes.co.nz directory site, Tradevine inventory management tool and Autobase classifieds site - and plans to keep doing so. Chief executive Jon Macdonald said the company is seeking new growth opportunities and "we'll likely augment our portfolio with judicious investments over the coming years". He told analysts there were "clear opportunities in the classifieds business". "It's quite nice to have three smallish acquisitions under our belt, and we're going to continue to grow our muscle in this space," he said. The online auction site held $36 million in cash and a $200m loan facility, which chief financial officer Jonathan Klouwens said Trade Me was looking at extending. Mr Macdonald said Trade Me has expanded its mobile team and built a suite of applications with a third of visits coming on mobile devices - twice the number a year earlier. It announced a 2.7 percent increase in profit to $37.4m in the six months ended December 31. That beat the revised forecast from its initial public offer of $34.8m. Earnings before interest, tax, depreciation, amortisation and depreciation climbed 14 percent to $59.2m, and revenue gained 18 percent to $80.4m. Mr Macdonald said the company was comfortable with analysts' forecasts for annual earnings, with trading in the last six weeks consistent with the first half. Trade Me is expected to post net profit of $77.5m on sales of $163.9m, based on the median forecasts compiled by Reuters. Trade Me's board declared an interim dividend of 7.5 cents per share.