30th Jul 2019 11:42
(Alliance News) - LSL Property Services PLC said on Tuesday it has sunk to a pretax loss, despite a slight revenue increase in the first six months of 2019, after restructuring and redundancy costs.
LSL however, anticipates a full year underlying operating profit in line with forecasts as the company said it will benefit from the restructuring.
In the six months to the end of June, the company made a pretax loss of GBP4.6 million although revenue rose 1% to GBP154.1 million. In the same period last year, it made a pretax profit of GBP6.4 million on revenue of GBP152.9 million.
The company incurred GBP13.0 million of exceptional costs, including branch closure, restructuring and redundancy fees. There were no exceptional costs in the comparative period last year.
LSL said underlying operating profit, which excludes these costs, rose 5% year-on-year to GBP12.2 million from GBP11.6 million.
Divisionally, LSL's estate agency revenue fell 13% to GBP77.1 million from GBP88.9 million which the company attributed to "soft market conditions". Underlying operating profit in the division rose to GBP4.0 million from GBP1.4 million however.
There was a 4% rise in revenue in financial services to GBP34.3 million from GBP33.0 million and the surveying and valuations division had a revenue hike of 37% to GBP42.7 million from GBP31.1 million.
The company is cautious about the residential property market outlook for the rest of 2019 due to the "political and economic environment and the potential impact on UK consumer confidence".
LSL proposed an interim dividend of 4.0 pence per share, flat on the year before.
Chair Simon Embley said: "The group delivered a positive financial performance in the first half of 2019, with positive growth in revenue and underlying operating profit, despite subdued residential property market conditions. The board remains confident the group will deliver a full year underlying operating profit in line with its prior expectations, as the business is expected to continue to benefit from the range of LSL's ongoing self-help measures.
"The board is confident the group, with its market leading brands, broad portfolio of residential property services and the benefits from the proactive self-help measures, remains in a strong position to perform well given a range of potential market conditions, in order to maximise shareholder value."
Shares in the company were flat at 200.00 pence each in London on Tuesday morning.
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