28th Feb 2020 09:13
(Alliance News) - Foxtons Group PLC said Friday its annual loss narrowed despite a decline in revenue amid difficult market conditions; however the company noted signs that the market may improve in 2020.
For 2019, the London-based estate agent reported a pretax loss of GBP8.8 million, narrowed from GBP17.2 million the year before, mostly due to a drop in other operating costs to GBP73.4 million from GBP88.5 million.
However, revenue fell by 4% to GBP106.9 million to GBP111.5 million, caused by a decline in the Lettings and Sales segments, despite a rise in Mortgage.
Revenue in the Lettings division fell by 2% to GBP65.7 million, affected by the tenant fee ban, and Foxton's decision not to increase its own fees.
Meanwhile, Sales revenue declined by 10% to GBP32.6 million, with transaction volumes and prices hit by continued political uncertainty.
Foxtons did not declare a dividend for the year, in-line with the prior year.
Looking ahead, Foxtons said it expects transaction levels in London to improve in the medium term, with structural demand driven by limited housing stock.
Although there is much more clarity on the UK's political direction following the general election, the company said it is still too early to predict how the market will behave during the year. Foxtons said it expects consumer confidence to improve, but structural issues to hold back sales volumes.
"In 2019 sales transactions continued to fall from the historic lows we saw the previous year. In addition, we saw fewer high-value sales at the top end of the market, which impacted sales revenue. In lettings, where our focus remains, we delivered another solid performance, despite the impact of the tenant fee ban which came into place in June 2019," said Chief Executive Officer Nic Budden.
"Looking forward, with the uncertainty of the general election removed, early signs are that the sales market may improve during 2020. Our sales pipeline is currently ahead of last year, however we are well prepared for further challenging conditions in the sales market in the run up to Brexit and will continue to build our lettings business and manage our cost base in line with trading conditions," Budden added.
Shares in Foxton were down 3.3% at 75.80 pence on Friday in London.
By Dayo Laniyan; [email protected]
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