30th Apr 2015 07:43
LONDON (Alliance News) - London-focused estate agency Foxtons Group PLC on Thursday reported lower revenue in the first quarter amid a sluggish property market in the capital, though its lettings and mortgage broking revenue rose.
Total revenue in the three months to the end of March was GBP33.1 million, down 3.1% year-on-year against a tough comparable, given the buoyancy in the London property market a year ago. Foxtons said the London sales market remains constrained in the first quarter, in line with trends seen at the end of 2014, amid uncertainty surrounding the General Election.
Lettings activity, however, showed steady growth in the quarter, with lettings revenue rising 5.4% to GBP15.9 million, while mortgage broking revenue rose 14% to GBP1.6 million
The group said its adjusted earnings before interest, taxation, depreciation and amortisation in the quarter was GBP8.3 million, translating to a margin of 25.2%, comparable to the margins seen in January 2013, when similar market conditions prevailed, but a sharp drop on the 31.8% margin it had a year ago.
The group said its current sales commission pipeline has held up well amid the tough market conditions and said growth in residential lettings looks set to continue at a healthy pace.
"As expected, property sales transactions in London have remained relatively flat since the end of last year with many potential buyers and sellers apparently delaying their decisions until the outcome of the General Election is known. Encouragingly growth in our letting business has continued from the momentum we saw at the end of last year," said Nic Budden, Foxton's chief executive.
"The attractive long-term fundamentals of the London property market remain sound, and we are firmly committed to our organic growth strategy which will see between five and ten new branches open each year. Many of our branches are now located in less central areas where we have seen greater levels of volume growth recently."
Shares in Foxtons were up 4.1% to 206.00 pence on Thursday morning.
By Sam Unsted; [email protected]; @SamUAtAlliance
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