REA GROUP LTD — Investor Presentation 2020

Feb 6, 2020

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ASX Announcement 7 February 2020

REA Group Investor Presentation HY2020

On behalf of REA Group Limited (ASX:REA) please find attached a half-year results presentation for the halfyear ended 31 December 2019.

The release of this announcement was authorised by Sarah Turner, General Counsel & Company Secretary

For further information, please contact:

REA Group Limited Investors: REA Group Limited Media: Graham Curtin Prue Deniz Executive Manager Group Finance Corporate Affairs P: +61 3 8456 4288 M: + 61 438 588 460 E: ir@rea-group.com E: prue.deniz@rea-group.com

About REA Group

About REA Group Limited: (www.rea-group.com): REA Group Limited ACN 068 349 066 (ASX:REA) (“REA Group”) is a multinational digital advertising business specialising in property. REA Group operates Australia’s leading residential, commercial and share property websites - realestate.com.au, realcommercial.com.au, Flatmates.com.au – as well as Spacely, a short-term commercial and co-working property site. In Asia, REA Group owns leading portals in Malaysia (iproperty.com.my), Hong Kong (squarefoot.com.hk) and Indonesia (rumah123.com), and prominent portals in Singapore (iproperty.com.sg) and China (myfun.com), and a leading property review site in Thailand (thinkofliving.com). REA Group owns Smartline Home Loans Pty Ltd, an Australian mortgage broking franchise group, and Hometrack Australia Pty Ltd, a leading provider of data property services. REA Group also holds a significant shareholding in property websites realtor.com in the US and PropTiger.com, housing.com and Makaan.com in India.

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REA Group Limited Investor & Analyst presentation Half-year results, 31 December 2019

Changing the way the world experiences property

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Resilient performance in tough market conditions

Results & market update	Progress on strategy	HY 2020 highlights
Resilient performance in challenging market conditions1: • Revenue2 down 6% • Operating expenses3 down 4% • EBITDA3 down 7% • Net profit down 13% Listings and project commencements • National residential listings: -14% • Sydney listings: -17% • Melbourne listings: -16% • New project commencements: -30% Signs of property market recovery • Syd & Melb leading recovery • Relaxed lending requirements • Gains in home prices4 • Buyer enquiries up over 30%5 • Increased dwelling approvals6	Individual, proactive & lifelong consumer interactions • New consumer technology platforms & capabilities • Active REA members increased 16%7 • Increased # of tracked properties8 Customer value driving leads & ROI • Record customer numbers committed to depth • Agent Match - 30% lead conversion9 • Ignite - making business easier Richest content, data & insights empowering decisions • Hometrack data integration • ~1.5m weekly Auction and Sales results emails10 • Record visits to News section of realestate.com.au11	Audience • realestate.com.au #1 across all platforms12 • Australia’s leading property app13 • #1 sites across Malaysia, Indonesia and Hong Kong14 Strong growth across International • Revenue growth in Malaysia, India and North America • 99.co JV presents opportunity to rapidly increase market share in Singapore and Indonesia Continued Group Capex investment • Investment focus on supporting product, technology and data strategies to underpin future growth opportunities

• (1) Financial results from core operations exclude significant non-recurring items such as restructure costs, gain/loss on acquisitions and disposals, and transaction costs. In the prior comparative period they excluded items such as revaluation, unwind and finance costs of contingent consideration, transaction costs relating to acquisitions by associates and impairment charges. (2) Revenue is defined as revenue from property and online advertising and revenue from Financial Services less expenses from franchisee commissions. (3) Operating expenses and EBITDA exclude share of losses of associates and joint ventures. (4) REA Internal Data (Home Price Index for Sydney and Melbourne) as at Dec 19 compared to Dec 18. (5) Adobe Analytics, total email leads and phone reveals, (Jul 19 - Dec 19) compared to the same period (Jul 18 - Dec 18). (6) ABS, Building Approvals, Australia, Nov 19 compared to Mar 19. (7) REA Internal Data (Jul 19 – Dec 19) and compared to the same period (Jul 18 – Dec 18). (8) REA Internal Data as at Dec 19 compared to Dec 18. (9) REA Internal Data (May 18 – Dec 19). (10) REA Internal Data (Jul 19 – Dec 19). (11) Adobe Analytics, visits to realestate.com.au/news (Oct 19). (12) Nielsen Digital Content Ratings (Monthly Tagged), text, Jul 19 – Dec

• 19, P2+, Computer, Smartphone and Tablet, realestate.com.au vs Domain, unique audience (Jul 19 – Dec 19 avg). (13) Nielsen Digital Panel, Jul 19 – Dec 19, realestate.com.au - Property App vs Domain Real Estate and Property App, Unique Audience. (14) SimilarWeb, monthly visits for iproperty.com.my site (Malaysia) compared to the nearest competitor and rumah123.com site (Indonesia) compared to the nearest competitor (Jul 19 - Dec 19), and squarefoot.com.hk site (Hong Kong) compared to the nearest competitor at Dec 19. Excludes app.

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Half year financial metrics A resilient performance in challenging market conditions

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-7% Flat
-6%
+6%
$272.1m 55.0¢
EBITDA [2] Interim Dividend
$440.3m
-13% -13%
Revenue [1]
$152.9m 116.1¢
NPAT [3] EPS [3]
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1. Revenue is defined as revenue from property and online advertising and revenue from Financial Services less expenses from franchisee commissions. 2. EBITDA excludes share of losses of associates and joint ventures. Financial results from core operations exclude significant non-recurring items such as restructure costs, gain/loss on acquisitions and disposals, and transaction costs. In the prior comparative period they excluded items such as revaluation, unwind and finance costs of contingent consideration, transaction costs relating to acquisitions by associates and impairment charges.

2. Financial results from core operations exclude significant non-recurring items such as restructure costs, gain/loss on acquisitions and disposals, and transaction costs. In the prior comparative period they excluded items such as revaluation, unwind and finance costs of contingent consideration, transaction costs relating to acquisitions by associates and impairment charges.

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Changing the way the world experiences property

Delivering on our purpose and growth strategy

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Individual, proactive & lifelong
consumer interactions
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• Property
• Finance
• Services
Deepest customer Richest content, data
value driving leads & insights
& ROI empowering decisions
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Our global network:
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A U S T R A L I A A S I A
N O R T H A M E R I C A
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realestate.com.au is No. 1 across all platforms[1]

The largest[2] and most engaged[2] audience of property seekers - record monthly visits of 92 million in October[3]

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Total visits Monthly searches Monthly unique audience
84m [4] 103m [5] 8.8m [6]
2.95x [4] +14% [5] +7% [6]
Average monthly traffic to Average monthly searches across Average monthly unique audience across
realestate.com.au on all platforms realestate.com.au on all platforms realestate.com.au on all platforms
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1. Nielsen Digital Content Ratings (Monthly Tagged), text, Jul 19 - Dec 19, P2+, Computer, Smartphone and Tablet, realestate.com.au vs Domain, unique audience (Jul 19 - Dec 19 avg).

2. “Largest” - Nielsen Digital Content Ratings (Monthly Tagged), text, Jul 19 – Dec 19, P2+, Computer, Smartphone and Tablet, average daily unique audience, realestate.com.au vs. Domain. “most engaged” - Nielsen Digital Content Ratings (Monthly Tagged), text, Jul 19 – Dec 19, P2+, average time spent on realestate.com.au vs. Domain.

3. Nielsen Digital Content Ratings (Monthly Tagged), text, Oct 19, P2+, Computer, Smartphone and Tablet, realestate.com.au, Total Sessions.

4. Nielsen Digital Content Ratings (Monthly Tagged), text, Jul 19 – Dec 19, P2+, Computer, Smartphone and Tablet, realestate.com.au, Total sessions (Jul 19 - Dec 19 avg) and vs. Domain. 5. Adobe Analytics, average monthly visits to realestate.com.au/searches (Jul 19 – Dec 19) and compared to the same period (Jul 18 – Dec 18).

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1. Nielsen Digital Content Ratings (Monthly Tagged), text, Jul 19 – Dec 19, P2+, Computer, Smartphone and Tablet, unique audience (Jul 19 - Dec 19 avg) and compared to the same period (Jul 18 – Dec 18).

Australia’s market leading property app[1]

People are using our realestate.com.au app more than ever before – record monthly app launches of 38 million in October[2]

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Hours on App

App launches

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App downloads

3 4 5 2.6m 34.9m 9.5m 4.06x[3] +28%[4] +12%[5] 2.9x Average monthly hours spent on Average monthly launches of Total downloads of realestate.com.au app the realestate.com.au app realestate.com.au app

1. Nielsen Digital Panel, Jul 19 – Dec 19, realestate.com.au - Property App vs Domain Real Estate and Property App, Unique Audience.

2. Nielsen Digital Content Ratings (Monthly Tagged), text, Oct 19, P2+, realestate.com.au app launches.

3. Nielsen Digital Content Ratings (Monthly Tagged), text, Jul 19 - Dec 19, P2+, total time spent on realestate.com.au app (avg in hours per month) and vs. Domain. 4. Nielsen Digital Content Ratings (Monthly Tagged), text, Jul 19 – Dec 19, P2+, realestate.com.au app launches and compared to the same period (Jul 18 – Dec 18). 5. Google Play & iTunes App Store, total number of realestate.com.au app downloads at Dec 19 and compared to Dec 18.

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Delivering a personalised consumer experience New technology and product innovation fueling growth

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Lifelong property relationships

• Active REA members increased 16% YoY[1]

• 26% YoY growth in consumers tracking properties[2]

• Over 1.4m properties being tracked[3]

• 3.7m personalised Residential Buy eDMs sent to consumers weekly[4]

• REA Internal Data (Jul 19 – Dec 19) and compared to the same period (Jul 18 – Dec 18). 2. REA Internal Data as at Dec 19 compared to Dec 18. 3. REA Internal Data as at Dec 19.

• REA Internal Data (Jul 19 – Dec 19).

• Adobe Analytics weekly average app bookings vs. responsive web bookings (Jul 19 – Dec 19). 6. Hitwise, visits to realestate.com.au/rent compared to visits to domain.com.au/rent (Jul 19 – Dec 19).

Market Leading Innovation

• New consumer technology platforms and capabilities driving personalisation across all channels

• New content in app feature delivering users over 200 stories, videos and image galleries each week

• New open for inspection booking tool facilitating 60,000 additional weekly bookings[5]

Australia’s #1 place for Rent

• 3.6x more monthly visits to rent section of realestate.com.au[6]

• ~1,000 tenant verifications purchased weekly[4]

• 1Form applications for the half increased 13% YoY to 1.6m[1]

• Flatmates.com.au welcomed over 218,000 new members[4]

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Strengthening our customer relationships

Delivering real value and great leads

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Delivering quality seller leads

• Growth in Property Showcase contracts sold[1]

• • 30% of Agent Match leads now converting into listings[2]

• ~44k Agent Ratings and Reviews currently published helping Agents stand out from competition[3]

Business made easy for customers

• Over 9,600 customers now signed up to Ignite[3 ]

• 96% of sessions accessed Ignite via app platform[4]

• • 74% of customers enabling push notifications to receive regular updates[3]

Prop20 unveiled

• National industry event series designed for REA customers

• Providing unique consumer insights and market trends

• Practical strategies to help drive customer success

• Running across Melbourne, Sydney, Brisbane, Adelaide, Perth

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1. REA Internal Data (Jul 19 – Dec 19) and compared to the same period (Jul 18 – Dec 18). 2. REA Internal Data (May 18 – Dec 19). 3. REA Internal Data as at Dec 19. 4. REA Internal Data (Jul 19 – Dec 19).

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Providing value beyond property transactions

Reaching more Australians in more ways

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Evolving property finance strategy

• $2.3 bn in digital home loan applications[1]

• • Smartline to be REA’s mortgage broking brand

• Smartline recognised as Australia’s top Franchise for 2019 for 10[th] time

• REA Internal Data, total value of digital home loan applications since launch to Dec 19.

• REA Internal Data (Jul 19 – Dec 19).

Rich market data & insights

• Hometrack data integrated across all platforms and channels

• ~1.5 million personalised Auction and Sales results[2] emails sent to consumers weekly

• 23.6m visits to realestate.com.au news section and 61% YoY growth[3]

Partnering with powerful brands

• news.com.au content sharing partnership driving rapid increase in traffic – record monthly visits in Oct of 4.4m, growing 76% YoY[4]

• 3 year partnership announced with Sydney Swans as major sponsor

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1. Adobe Analytics, total visits to realestate.com.au/news (Jul 19 – Dec 19) and compared to the same period (Jul 18 – Dec 18). 4. Adobe Analytics, visits to realestate.com.au/news (Oct 19) and compared to the same period (Oct 18).

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Our global footprint spans three continents Providing exposure to some of the world’s largest and fastest growing property markets

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Exciting long-term growth strategy across Asia

Leveraging REA Group’s capabilities to extend into Asia

Number one property sites in Malaysia, Hong Kong and Indonesia[1]

• Malaysia – 1.7X

• Indonesia – 1.2x

• Hong Kong – 1.04x

Strong audience growth

• Malaysia visits increased 51% YoY[2]

• Indonesia increased visits 64% YoY[3]

• Hong Kong visits increased 38% YoY[4]

• Product innovation fueling consumer growth • New “Points of Interest” search experience released in Hong Kong, Malaysia and Singapore • New “Page for Every Building” search experience released in Singapore allowing consumers $440.3m to find properties available in buildings of interest

Inaugural Portal Demand Report launched in Malaysia

REVENUE

• Provides unique analytics and insights on property demand with the report reaching an audience of over 97 million people[5]

99.co JV presents opportunity to expand market share

• Exciting opportunity to rapidly increase market share in Indonesia and Singapore

• Transition of assets to JV company in Q3 FY 2020

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1. SimilarWeb, monthly visits for iproperty.com.my site (Malaysia) compared to the nearest competitor and rumah123.com site (Indonesia) compared to the nearest competitor (Jul 19 - Dec 19), and squarefoot.com.hk site (Hong Kong) compared to the nearest competitor at Dec 19. Excludes app. 2. SimilarWeb monthly visits for iproperty.com.my (Jul 19 – Dec 19) compared to the same period (Jul 18 – Dec 18). Excludes apps.

2. SimilarWeb monthly visits for rumah123.com (Jul 19 – Dec 19) compared to the same period (Jul 18 – Dec 18). Excludes apps.

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1. SimilarWeb, monthly visits for squarefoot.com.hk and GoHome.com.hk sites (Jul 19 – Dec 19) compared to the same period (Jul 18 – Dec 18). Excludes apps. 5. Ariff Communications, 24 August – 31 October, 2019.

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REA Group diversifying into global markets

Global investments delivering growth

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• Revenue increased 2% to US$244 million[1]

• Q2 average monthly unique users increased 9% to ~59 million - mobile representing more than half of all unique users[2]

• New product features successfully launched:

• Provided consumers with Schedule Tour and Cash Back Offers, adding additional incentives for consumers to connect with customers

• Launch of Photo First to improve the home buyers’ property browsing experience

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• Revenue increased 25%[3]

• Combined traffic increased 34%[4]

• Housing.com grew listings by 90%[5]

• Innovative experiences launched on Housing.com including:

  • New search capability targeting students and young professionals looking for paying guests and co-living communities in 12+ cities on Housing.com

  • 360-degree virtual site tour providing immersive experience launched on Housing.com

• NewsCorp’s Form 10-Q stated in US Dollars for the six month period ended 31 December 2019.

• NewsCorp’s Earnings Release stated in US Dollars (6 February 2020) for the six month period ended 31 December 2019: Average monthly unique users for Q2 FY 2020 and compared to the same period Q2 FY 2019. 3. Elara Technologies Pte. Ltd. Internal Data: revenue, for the period (Jun 19 – Nov 19) compared to the same period (Jun 18 – Nov 18).

• Elara Technologies Pte. Ltd. Internal Data: average monthly visits to proptiger.com and housing.com (Jun 19 – Nov 19) compared to the same period (Jun 18 – Nov 18).

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1. Elara Technologies Pte. Ltd. Internal Data: average monthly active listings for housing.com for the period (Jun 19 – Nov 19) compared to the same period (Jun 18 – Nov 18).

Our people and culture sets us apart

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REA Group recognised as one of Australia’s top 50 Best Places to Work

People are at the heart of REA Group

• Over 1,500 talented people across Australia and Asia

• Ranked #6 in Australia’s top 50 Best Places to Work by Great Place to Work Australia

• Global Employee Value Proposition helping to attract and retain the best talent

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Diversity, inclusion and talent

• 50:50 Executive Leadership Team gender representation

• One third of employees have been internally promoted in the last 12 months

• Award winning Women in Technology and Graduate programs

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• 30% technology roles held by women, well ahead of the global industry average

Inaugural Sustainability report launched

• Commitment to responsible and sustainable business practices underpins everything we do

• Sustainability Report outlines performance and targets across Environment, Social and Governance (ESG)

• Our long-term commitment to sustainability is integral to ongoing success

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Australian bushfire relief support

• Financial support provided to Red Cross appeal, matched employee donations and fundraising initiatives

• Bushfire Relief Support Package available to customers

• Free Flatmates.com.au service for those offering and seeking emergency accommodation

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Financial Highlights Half year results, 31 December 2019

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Financial operating results

Performance ($m)	HY 2020	HY 2019	Growth $m	Growth %
Revenue1 Australia 400.5 428.5 (28.0) (7%) Financial Services 12.6 14.7 (2.1) (14%) Asia 27.2 26.0 1.2 5%
Group Revenue 440.3 469.2 (28.9) (6%) EBITDA2 Australia 271.5 293.2 (21.7) (7%) Financial Services 4.3 5.8 (1.4) (25%) Asia 6.3 5.7 0.6 11% Corporate (10.0) (10.6) 0.7 (6%)
Group EBITDA before associates2 272.1 294.0 (21.9) (7%) EBITDA Margin 62% 63% Associates (4.9) (4.9) - -
Group EBITDA2 267.2 289.1 (21.9) (8%) EBITDA Margin 61% 62% Net profit2 152.9 176.6 (23.7) (13%) Cash Balance 91.0 59.8 31.2 52% Earnings Per Share ('EPS') (cents)2 116.1 134.1 (18.0) (13%) Dividend Per Share (cents) 55.0 55.0 - -
Reconciliation to Financial Statements ($m) HY 2020		HY 2019	Growth $m	Growth %
Net profit from core operations 152.9 Restructure costs, net of tax (2.9) Gain/(loss) on acquisitions and disposals and business combination transaction costs3 (2.3) Impairment charge - Unwind, revaluation and finance costs of contingent consideration -		176.6 (23.7) (13%) - (2.9) n/m (0.1) (2.2) >100% (173.2) 173.2 n/m (0.8) 0.8 n/m
Reported net profit 147.7		2.5 145.2 >100%

Reconciliation to Financial Statements ($m)	HY 2020	HY 2019	Growth $m	Growth %
Net profit from core operations Restructure costs, net of tax	152.9 (2.9)	176.6 -	(23.7) (2.9)	(13%) n/m
Gain/(loss) on acquisitions and disposals and business combination transaction costs3	(2.3)	(0.1)	(2.2)	>100%
Impairment charge	-	(173.2)	173.2	n/m
Unwind, revaluation and finance costs of contingent consideration	-	(0.8)	0.8	n/m
Reported net profit	147.7	2.5	145.2	>100%

1. Revenue is defined as revenue from property and online advertising and revenue from Financial Services less expenses from franchisee commissions. 2. Financial results from core operations exclude significant non-recurring items such as restructure costs, gain/loss on acquisitions and disposals, and transaction costs. In the prior comparative period they excluded items such as revaluation, unwind and finance costs of contingent consideration, transaction costs relating to acquisitions by associates and impairment charges.

2. Transaction costs incurred in the current period relate to the Group’s disposal of its investment in iProperty Singapore and Indonesia and its investment in the 99.co joint venture. Transaction costs incurred in the prior comparative period relate to the Group’s share of costs from acquisitions by associates.

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Revenue ($m) [1]
HY20 440.3
HY19 469.2
HY18 406.8
HY17 337.3
HY16 289.8
EBITDA ($m) [2]
HY20 267.2
HY19 289.1
HY18 242.8
HY17 200.1
HY16 176.7
EPS (cents) [2]
HY20 116.1
HY19 134.1
HY18 111.8
HY17 92.5
HY16 87.5
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Unfavourable market conditions

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1
Residential Listing Changes
0%
-5%
-10%
-15%
-20%
-25%
-30%
-35%
Q1 19 Q2 19 Q3 19 Q4 19 Q1 20 Q2 20
National Melbourne (metro) Sydney (metro)
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Dwelling Commencements [2]
60,000
Now
50,000
40,000
30,000
20,000
10,000
0
Q4 13 Q4 14 Q4 15 Q4 16 Q4 17 Q4 18 Q4 19 Q4 20 Q4 21 Q4 22
Private Houses Private Attached Dwellings Total Private Dwellings
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Residential listings

• Australian residential listings decreased 14%. The overall decline was driven by declines of 17% in Sydney and 16% Melbourne, two of the highest yielding cities.

• Q2 listings indicate gradual recovery compared to Q1 FY 2020.

• Residential listing declines continued into January (-13%), with Sydney down 7% and Melbourne down 5%.

Developments

• Developer revenue declined reflecting the continued reduction in new project commencements down 30% for the half.

• BIS Oxford forecasts total new dwelling commencements to be 17% lower in the second half of FY 2020 YoY[2] .

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1. REA Internal Data for the three month periods ended 30 Sep 2018, 31 Dec 2018, 31 Mar 2019, 30 Jun 2019, 30 Sep 2019 and 31 Dec 2019. 2. BIS Oxford BIA Data - dwelling commencements quarterly forecast at December 2019.

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Resilient performance in challenging market conditions

Group EBITDA ($m)[1] 289.1 (19.3) (1.6) (6.6) 7.0 267.2 1.2 (0.5) (2.1) HY 2019 Aus Aus Aus Aus Financial Asia Revenue Operating HY 2020 Group EBITDA Residential Developer & Media, Data & Subscriptions Services Expenses Group EBITDA depth Commercial Other depth Revenue Costs

• Residential revenue decline of 6% reflects unfavourable market conditions, partially offset by price changes taking effect from 1 July 2019 and continued growth in Premiere penetration, Property Showcase, Rent depth penetration and Tenant Verification.

• Developer and Commercial revenue declined by 4% reflecting the continued reduction in new project commencements down 30% for the half.

• Media, Data and Other revenue declined by 12% primarily due to a reduction in Developer display advertising due to lower new project commencements which was partially offset by continued growth from the Data business.

• Financial Services revenue was 14% lower primarily due to lower Partnership payments and reduced mortgage settlements, influenced by lower listings.

• The Asian business delivered a 5% increase in revenue driven by strong revenue growth in Malaysia, underpinned by improved customer acquisition and increased consumer audience.

• Operating expenses decreased 4% as a result of strong cost management and efficiencies gained from an organisational realignment (2% reduction excluding impact of AASB 16).

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1. Financial results from core operations exclude significant non-recurring items such as restructure costs, gain/loss on acquisitions and disposals, and transaction costs. In the prior comparative period they excluded items such as revaluation, unwind and finance costs of contingent consideration, transaction costs relating to acquisitions by associates and impairment charges.

17

Delivering value for customers

Residential Premium Listing Penetration (depth)

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Residential listing depth penetration

• Improved product mix and further depth penetration notwithstanding challenging market conditions.

• Record number of customers committed to depth products.

• Continued increase in penetration of the highest yielding listing product ‘Premiere’ demonstrating the superior returns to agents and vendors.

Other product growth

• Increased contribution from strong rent penetration and additional products such Tenant Verification and Property Showcase.

• Since launch, more than 58,000 Tenant Verifications have been purchased.1

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1H 2016 2H 2016 1H 2017 2H 2017 1H 2018 2H 2018 1H 2019 2H 2019 1H 2020
Premiere property Highlight property Feature property
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• Penetration is based on listings being on site for minimum 3 days.

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1. REA Internal Data, total tenant verifications purchased (Dec 18 – Dec 19).

Continued international growth

Asia

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+5% +11%
Asia Revenue Asia EBITDA [1]
$27.2m $6.3m
Share of Losses Share of Losses
Elara Move [2]
$3.2m $1.5m
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1. Excludes share of losses of associates and joint ventures. Financial results from core operations exclude significant non-recurring items such as restructure costs, gain/loss on acquisitions and disposals, and transaction costs. In the prior comparative period they excluded items such as revaluation, unwind and finance costs of contingent consideration, transaction costs relating to acquisitions by associates and impairment charges.

2. Financial results from core operations exclude significant non-recurring items such as restructure costs, gain/loss on acquisitions and disposals, and transaction costs. In the prior comparative period they excluded items such as revaluation, unwind and finance costs of contingent consideration, transaction costs relating to acquisitions by associates and impairment charges.

3. SimilarWeb, monthly visits for iproperty.com.my site compared to the nearest competitor (Jul 19 - Dec 19). Excludes app. 4. NewsCorp’s Form 10-Q stated in US Dollars for the six month period ended 31 December 2019.

4. Revenue and EBITDA driven by strong revenue growth in Malaysia underpinned by improved customer acquisition and increased consumer audience. Malaysia has a leadership position of 1.7x the nearest competitor[3] . The ongoing disruption in Hong Kong impacted the overall segment result.

5. Elara Technologies (‘Elara’) operates digital property brands Housing.com, PropTiger and makaan.com.

6. Reported revenue growth of 25% due to strong growth in PropTiger and Housing.com. The Group’s share of losses in Elara increased due to continued investment in technology and marketing.

North America

• Move, Inc. operates realtor.com, the number two property portal in North America.

• Reported revenue growth of 2% to US$244 million[4] was due primarily to the acquisition of Opcity, partially offset by lower revenue from software and services.

• Our share of losses from Move decreased for the half due to an increase in revenue from real estate revenues, as well as a reduction in operating costs despite increased investment in Opcity.

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19

Operating results

HY20 revenue

Group Operating Results Growth[1]

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30.0%
iProperty
acquisition
20.0%
Unprecedented listings conditions
(FY 2019: -8%, HY 2020: -14%)
10.0%
-
FY 2016 FY 2017 FY 2018 FY 2019 HY 2020
(10.0%)
Revenue growth Operational expenses growth
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• Impacted by significant decline in Residential listings and Developer new project commencements.

• Resilient performance despite challenging market conditions.

HY20 costs

• Strong cost management and efficiencies gained from an organisational realignment resulted in a 4% reduction in total operating expenses (2% reduction excluding impact of AASB 16).

• The realignment has increased the speed and efficiency of product delivery across the business, while allowing continued investment in innovation and growth initiatives.

FY20 target

• The Group will continue to invest in growth initiatives. Planned efficiency gains and strong cost management are expected to result in a reduction in operating costs YoY. As a result, the rate of revenue growth is expected to exceed the rate of cost growth for the full year.

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1. Financial results from core operations exclude significant non-recurring items such as restructure costs, gain/loss on acquisitions and disposals, and transaction costs. In the prior comparative period they excluded items such as revaluation, unwind and finance costs of contingent consideration, transaction costs relating to acquisitions by associates and impairment charges.

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Continued investment in Capital Expenditure

Capital Expenditure
7% 7% 7% 8% - 10.0 20.0 30.0 40.0 50.0 60.0 70.0 FY 2016 FY 2017 FY 2018 FY 2019 Amount ($m) Group Capital Expenditure CapEx Once-off office fit out co Total Depreciation and Amortisation expense CapEx as a % of revenue	8% 0% 5% 10% 15% 20% 25% HY 2020 % of revenue sts (excl. office fit out)
REA Group ($m) HY 2020 Actual expense FY 2020 Expected expense FY 2020 Total expense
Core Depreciation & Amortisation 33 33-35 66-68 Depreciationofleases 4 5 9
Total 37 38-40 75-77
Impact of AASB 16 ($m) Impact HY 2020 Actual expense FY 2020 Expected expense FY 2020 Total expense
Operating expense - rent + 4 5 9 Depreciation expense - (4) (5) (9) Interest expense - (1) (1) (2)
Net impact to Income Statement - (1) (1) (2)

Investment strategy

• The Group continues to invest to support growth over the medium to long term. Investment focus is on consumer experience plus new product delivery and supporting technology.

Once-off fit out costs

• HY 2020 costs relate to office fit outs (mainly Melbourne).

• For the FY 2020 full year, the Group expects to incur $10-12 million of once-off capital expenditure in relation to office fit-outs, including the move to our expanded office in Melbourne.

AASB 16

• Implemented AASB 16 from 1 July 2019.

• Net impact to the Income Statement for the half-year was $1.3 million.

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Strong operating cash flows

• Strong operating cash flows enabled: • Repayment of $70m of debt • Retained interim dividend payment of 55.0c despite decline in core NPAT

• • Continued investment in innovation and acquisitions

Group cash flow ($m)

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494.6 (239.2) acquisitions
Includes $70m net debt repayment
169.5 (243.2)
(88.8)
(2.6)
(17.9) (34.5)
(83.6)
137.9
(1.2)
- 91.0
Opening cash Recei pts from Payments to suppliers Income taxes Net interest Payment for Capital Proceeds from Repayment of Payment o f Other Closing cash balance
balance customers and employees paid paid acquis iti on of expenditure borrowings borrowings dividends
subsidi ary and and leas es
inves tment in
associates and
joint ventures
Operating Activi ties Investi ng Activities Financing Activi ties Other
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1
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Supplementary Information

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Resilient performance in challenging market conditions

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Group Revenue ($m)
283.2
302.0
(6%)
68.4
(4%) 71.1 48.8
(12%) 55.4 12.6 27.2
5% 26.0
(14%) 14.7
HY 2020 HY 2019 HY 2020 HY 2019 HY 2020 HY 2019 HY 2020 HY 2019 HY 2020 HY 2019
Aus: Residential Depth & Subs Aus: Commercial & Developer Depth & subs Aus: Media, Data & Other Aus: Financial Services Asia
Revenue category ($m) [1] HY 2020 HY 2019 Growth
Australia
Depth revenue 322.5 343.4 (6%)
Subscription revenue 29.2 29.8 (2%)
Media, Data & Other 48.8 55.4 (12%)
Financial Services 12.6 14.7 (14%)
Australian revenue 413.1 443.2 (7%)
Asia 27.2 26.0 5%
Total revenue 440.3 469.2 (6%)
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1. Revenue is defined as revenue from property and online advertising and revenue from Financial Services less expenses from franchisee commissions.

Historical Revenue & EBITDA

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Revenue, EBITDA and Margin
(core operations) [1]
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60%
874.9 50%
807.7
40%
671.2
579.1
30%
501.2
463.7
440.3
380.9 20%
327.8
267.2
10%
0%
FY 2016 FY 2017 FY 2018 FY 2019 HY 2020
EBITDA Revenue EBITDA margin
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1. Financial results from core operations exclude significant non-recurring items such as restructure costs, gain/loss on acquisitions and disposals, and transaction costs. In the prior comparative period they excluded items such as revaluation, unwind and finance costs of contingent consideration, transaction costs relating to acquisitions by associates and impairment charges.

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Financial comparatives

					Core Operations1	Core Operations1					Financial Statements	Financial Statements
	HY	2016	HY	2017	HY	2018	HY	2019	HY	2020	HY 2020
Group results	$m	Growth	$m	Growth	$m	Growth	$m	Growth	$m	Growth		$m
Total revenue	289.8	21%	337.3	16%	406.8	21%	469.2	15%	440.3	(6%)		440.3
Total operating income	289.8	21%	337.3	16%	406.8	21%	469.2	15%	440.3	(6%)		440.3
Operating expenses	(107.2)	(9%)	(135.5)	(26%)	(160.0)	(18%)	(175.2)	(10%)	(168.2)	4%		(174.7)
Share of losses of associates & joint ventures	(5.9)	>100%	(1.8)	70%	(4.0)	>100%	(4.9)	(22%)	(4.9)	-		(3.8)
EBITDA	176.7	26%	200.1	13%	242.8	21%	289.1	19%	267.2	(8%)		261.8
EBITDA margin	61%		59%		60%		62%		61%			59%
Depreciation & amortisation	(13.4)	(19%)	(17.9)	(33%)	(23.1)	(29%)	(29.0)	(25%)	(36.7)	(27%)		(36.7)
Earnings before interest and tax	163.3	26%	182.2	12%	219.7	21%	260.1	18%	230.5	(11%)		225.1
Net finance income/(expense)	0.7	(74%)	(6.2)	(>100%)	(3.9)	(>100%)	(3.4)	13%	(3.6)	(4%)		(3.6)
Earnings before tax	164.0	24%	176.0	7%	215.8	23%	256.6	19%	226.9	(12%)		221.5
Income tax expense	(48.7)	(3%)	(54.2)	(11%)	(68.4)	(26%)	(80.1)	(17%)	(74.0)	8%		(73.8)
Net profit	115.3	36%	121.8	6%	147.3	21%	176.6	20%	152.9	(13%)		147.7
Dividends per share (DPS) (cents)	36.0	22%	40.0	11%	47.0	18%	55.0	17%	55.0	-		55.0
Earnings per share (EPS) (cents)	87.5	36%	92.5	7%	111.8	21%	134.1	20%	116.1	(13%)		112.1

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1. Financial results from core operations exclude significant non-recurring items such as restructure costs, gain/loss on acquisitions and disposals, and transaction costs. In the prior comparative period they excluded items such as revaluation, unwind and finance costs of contingent consideration, transaction costs relating to acquisitions by associates and impairment charges.

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Cash flow reconciliation

Cash flow reconciliation ($'m)	HY 2020	HY 2019	Growth
EBITDA1	267.2	289.1	(8%)
Working capital movement	(15.9)	(31.5)	50%
Net interest paid	(2.6)	(5.3)	51%
Income taxes paid	(88.8)	(75.7)	(17%)
Capital expenditure	(34.5)	(31.9)	(8%)
Other	3.2	0.4	>100%
Free cash flow	128.6	145.1	(11%)
Receipt/(payment) for acquisition of subsidiary	(15.9)	3.2	(>100%)
Receipt/(payment) for investment in associates and joint ventures	(2.0)	-	n/m
Proceeds from borrowings	169.5	-	n/m
Repayment of borrowings and leases	(243.2)	(122.4)	(99%)
Dividends paid	(83.6)	(81.8)	(2%)
Other	(0.3)	(0.1)	(>100%)
Net cash inflow/(outflow)	(46.9)	(56.0)	(16%)

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1. Financial results from core operations exclude significant non-recurring items such as restructure costs, gain/loss on acquisitions and disposals, and transaction costs. In the prior comparative period they excluded items such as revaluation, unwind and finance costs of contingent consideration, transaction costs relating to acquisitions by associates and impairment charges.

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Visit our investor site at rea-group.com

Disclaimer: This presentation contains non-specific background information about REA Group’s current activities. This information is a summary only. Investors and potential investors should obtain independent advice. This information is not intended to provide advice to investors or potential investors and does not take into account the individual investment objectives, financial situation or needs of any particular investor(s). These factors should be considered when making investment decisions.

Investors: Graham Curtin Executive Manager Group Finance P: +61 3 8456 4288 E: ir@rea-group.com

Media: Prue Deniz Corporate Affairs M: +61 438 588 460 E: prue.deniz@rea-group.com

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