Online real estate advertiser REA Group remains committed to its expansion into Italy despite economic challenges in the European nation.

The company behind realestate.com.au increased its net profit by 37 per cent in the six months to December 31, to $70.7 million.

Revenue also increased, by 38 per cent, but in its Italian operations, which includes two property websites, revenue fell by 91 per cent.

Chief executive Greg Ellis said he believes the Italian business would eventually grow, despite the current challenging economic conditions.

“You’ve got material economic conditions that are not positive to running companies at the moment,” he said.

“We don’t see it as a medium to long term environment. We see it to a short to medium term issue.

“We think it’s still a good market.”

Its Australian operations performed strongly, with 30 per cent revenue growth in the half year, as strong demand drives home prices higher, and visits to REA’s websites.

“Sydney is the most competitive market we have,” Mr Ellis said.

The company has plans to launch a Chinese website, myfun.com, for Chinese customers looking to buy Australian properties.

REA’s business in Hong Kong and Luxembourg also grew in the first half of the financial year.

Revenue in Hong Kong increased 15 per cent and Luxembourg’s revenue increased 25 per cent.

“Our group performance demonstrates our ability to achieve strong growth, while continuing to expand our operations, both locally and internationally,” Mr Ellis said.

REA’s shares were up $2.17, or 5.2 per cent, at $43.86 at 1532 AEDT.