10th Mar 2021 10:11
(Alliance News) - Foxtons Group PLC on Wednesday said 2021 has got off to a strong start after a slip in revenue in 2020.
The London-based estate agency said revenue in 2020 fell to GBP93.5 million from GBP106.9 million reported for 2019.
The company said adjusted operating profit was GBP1.9 million, swinging from a loss of GBP700,000 the year before, thanks to a GBP15.9 million reduction in operating costs which offset a GBP13.4 million reduction in revenue. Pretax loss narrowed to GBP1.4 million from GBP8.8 million.
Foxtons reported a "strong" operating recovery once the first lockdown was eased, with improved second-half performance. The company said three lettings book acquisitions were completed in the year, for a total investment of GBP4.6 million, adding a combined 1,600 tenancies.
Going forward, the company said, following the recovery of profitability in the second half of 2020, its financial performance has continued to improve into 2021. The company's revenue for the first two months of 2021 is well ahead of 2020 and continued tight cost control has resulted in growth in its operating profit over that period.
"The March 2021 budget announcement, which brought more certainty for our customers, and the rollout of the mass vaccination programme is expected to result in higher volumes in the residential sales market which, with our expertise and results focused proposition, we are well placed to benefit from," noted Chief Executive Nic Budden.
Foxtons declared no dividend for 2020, unchanged from 2019 and 2018.
"Although no dividend has been paid this year, we are mindful that in ordinary times this is a cash generative business," said Chair Ian Barlow. "Our capital allocation encompasses reinvestment in the business, dividend policy and other forms of returning cash; for example, through share buy backs or special dividends."
Foxtons noted it announced a "modest" share buyback programme of GBP3 million back in December.
Last week, Foxton's said it had agreed to buy smaller peer Douglas & Gordon Estate Agents Ltd for GBP14.3 million in cash, as part of its strategy to grow its lettings book.
Douglas & Gordon is a London-based estate agent founded in 1958. It is being bought from the Talbot Willcox family and a group of former employee shareholders.
Foxtons shares were trading 1.4% higher in London on Wednesday morning at 59.80 pence each.
By Evelina Grecenko; evelinagrecenko@alliancenews.com
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