Frontier Digital Ventures Turns First Yearly Profit Since 2016 IPO

The Malaysia-based classifieds operator Frontier Digital Ventures has released its full-year 2020 report, highlights of which include positive portfolio EBITDA of $629,000 for the year, the best return since the company's IPO in 2016.

Run by ex-REA Group and iProperty Executive Shaun Di Gregorio, FDV owns stakes in a variety of classifieds businesses in emerging markets around the world including leading auto and property portals as well as generalist classifieds sites in Africa, Asia and Latin America. The company has been actively expanding its portfolio over the last 12 months having bought Avito, Tayara and Fincaraíz from Adevinta back in October and followed up with the purchase of Chilean generalist site Yapo last week.

According to FDV's investor presentation Leading Sri Lankan property portal LankaPropertyWeb lead the way in revenue growth with gains of 19% over the year while the company's flagship portfolio company, the Pakistani market-leading portal Zameen, saw modest revenue losses of -5% despite pandemic headwinds. At the other end of the scale, Philippino homes platform Hoppler saw revenue decrease 37% as it acquired regional competitor Zipmatch.

As for non-financial performance indicators, although the total combined number of advertisers on FDV portfolio sites dropped slightly from 1.2 million to 1.1 million for the second half of 2020, total sessions jumped from 173 million to 223 million and total leads sent saw a huge increase from 27 million to 43 million.

Backing increased growth in its portfolio, 2020 also saw FDV also increase its share in LankaPropertyWeb and Burmese portal iMyanmarHouse as well as complete a 100% purchase of Moroccan cars vertical Moteur. In an earnings call Di Gregorio highlighted his company's aggressive approach not only to mergers and acquisitions which is set to continue, but also towards updating the product offered by each company:

"So these acquisitions have added much to our revenue profile. And when you look at the pro forma view, you get a bit of a sense of the significance of them and what our company is going to look like in 12 and 24 months from now as we see growth return in a post-COVID world, but also the impact of extending the product reach or the product offering for the new acquisitions in a much more aggressive manner than perhaps has been done by their current owners at the moment."

Much like those outlined in other recent investor presentations from public portal companies around the world, FDV's vision for the future is one of moving closer to transactions and unlocking ancillary revenue streams with the move being driven by what the earnings call described as a "really interesting movement by consumers who want to do more of a transaction than they were doing before. They want to go way past just looking at ads, and that's where a lot of the value is in these businesses."