Carsales.com lifts FY11 profit 35%

Carsales.com (ASX:CRZ) attributed its healthy profit growth for FY11 partly to gains from its developing display advertising unit

Carsales.com (ASX:CRZ) has reported a 35 per cent increase in FY11 profit, due in part to a strong showing in display advertising.

The online automotive advertising company reported a profit of $58.3 million for the year, on 26 per cent higher operating revenue of $152.5 million.

The bottom line was aided by a 51 per cent growth in display advertising business during the year.

CEO Greg Roebuck said display ad division Mediamotive transitioned to conducting all its sales activities in-house during the year. “This is an important evolution from what was a purely outsourced model just three years ago,” he said.

Roebuck added that he expects display ad growth to continue to grow along with the market for online automotive sales.

Overall private ad placement volumes grew by double digits over the year.

While operating expenses grew 20% to $68.7 million, ebitda margins improved two percentage points to 55%.

Roebuck said he anticipates “plenty of activity by [rivals] trying to regain market share” in the financial year ahead, but added that he is confident the company is in a “great position” to compete.

CRZ shares grew 3.55% in Tuesday's trading to $4.670.

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