REA Group Limited aims higher at last AGM as master of its ASX domain

It was certainly a year to celebrate for REA Group Limited (ASX:REA). Here's why…

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It's been a great year for REA Group Limited (ASX: REA) and the real estate advertising company's shareholders who have seen their stock surge by more than 50%.

REA's shares were changing hands for about $77 on Wednesday as it held its AGM in Melbourne.

So Chairman Hamish McLennan was able to reflect on the company's financial year (FY) 2017 success story.

"This is reflected in our share price, which has once again outperformed the S&P/ASX200 and reached record highs this year," Mr McLennan said.

Mr McLennan was also able to boast that revenue increased by 16% to $671 million as REA's EBITDA rose by 16% to $381 million.

REA also achieved a 12% increase in net profit, bringing it up to $228 million, according to the company.

Mr McLennan also reflected on REA's partnership with National Australia Bank Ltd (ASX: NAB) which has allowed the creation of "an end-to-end finance experience on realestate.com.au, offering consumers access to NAB and realestate.com.au-branded home loans".

It was a move that seemed to please shareholders and demonstrates how REA is able to utilise its strong market position and is willing to do so.

REA CEO Tracey Fellows reassured shareholders that FY 2017's success is carrying through to FY 2018 and touched on REA's first quarter results.

REA has increased revenue by 21% delivering $190 million and grown EBITDA by 24%, delivering $107 million, according to Ms Fellows.

"The numbers are driven in large part by our Australian residential business," Ms Fellows said.

"While listings across the nation were flat, we did see an uptick in the markets of Sydney and Melbourne."

REA has proved a success story since its spinoff from News Corp (ASX: NWS) and no doubt Fairfax Media Limited (ASX: FXJ) and Domain Holdings Australia Ltd (ASX: DHG) will be hoping history repeats.

Domain shares picked up on Wednesday gaining 4% to close at $3.57 after sinking a bit earlier in the week.

And while Domain only appeared as a footnote at REA's AGM, it would be a surprise if the recent events weren't in the minds of REA's key players who have enjoyed a good time running a company that was once the only solid digital real estate advertising option for ASX investors.

The game has since changed.

Motley Fool contributor Steve Holland 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 Bruce Jackson.

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