Bottom feeders will be disappointed if they were expecting the rout in REA Group shares to continue.
The company's stock steadied yesterday, closing up 32 cents at $36.32 after being smashed earlier this week following the shock departure of chief executive Greg Ellis.
REA Group chairman Hamish McLennan told investors yesterday that recovery in the residential property market had driven positive first-quarter revenue growth at the company.
The update on trading conditions was disclosed on an investor briefing conference call that was convened following Ellis's departure.
"We have already had some strong indicators of success in financial year '14 ," McLennan said.
He said "positive Q1 revenue growth" was being driven by the move from a subscription model to a listing-based model.
"In addition, the demand for our list depth products including 'highlight premier' and 'project profile' have continued our residential business success and have performed very strongly as a result of the improved market conditions," he said.
REA has enjoyed great success on the back of depth products, which offer estate agents the opportunity to pay more to enhance and highlight a single property listing. The products helped deliver a record full-year net profit this year for the operator of the realestate.com.au website.
"We're on track to achieve our strategy for the year and look forward to sharing more with you at the half-yearly result in early February," McLennan said.
Ellis was also on the call, but declined to reveal where he was headed amid speculation of a role in Europe. He will stay on at REA until a successor is appointed.
Ellis has emphatically rejected suggestions there was anything untoward in the circumstances surrounding his exit, and flatly denied rumours of a rift with board members including McLennan.
"The board is confident that REA Group will continue to go from strength to strength," McLennan reassured investors.
"Operationally, it's business as usual. The team will continue to focus on delivering an exceptional service to consumers, customers, and property owners."
REA is 62 per cent-owned by News Corporation, publisher of The Australian.