5th Mar 2019 12:07
LONDON (Alliance News) - LSL Property Services PLC on Tuesday lowered its dividend amid a double-digit drop in profit, despite a slight rise in revenue, due to challenging market conditions.
The residential property services provider reported pretax profit of GBP23.1 million for 2018, down 42% from GBP40.1 million the year before. This was due to higher costs, a one-off charge of GBP5.2 million from transition costs related to a surveying contract, and restructuring.
Stripping out exceptional charges, on an underlying basis operating profit declined by 4% to GBP35.9 million from GBP37.5 million.
This was due to operational gearing on lower residential sales exchange volumes within the Estate Agency segment, more than offsetting any benefits from Financial Services and Lettings.
Revenue still saw a slight increase, up 4% to GBP324.6 million from GBP311.5 million the prior year, with revenue growth in the Surveying and Estate Agency divisions.
LSL declared a final dividend of 6.9 pence per share, bringing the total payout to 10.9p, down 4% from 11.3p the year before.
Looking ahead, LSL's performance to date in 2019 has been behind management expectations. However, the company's self-help measures implemented has given LSL confidence that its 2019 underlying operating profit will come in line with expectations.
"The group delivered a highly resilient revenue and underlying operating profit performance in 2018 despite challenging residential property market conditions. We continue to deliver a range of proactive self-help initiatives demonstrating the breadth of opportunity across the group," said Chair Simon Embley.
"We continue to remain cautious on the residential property market outlook for 2019 given the current uncertainty over the UK and global political and economic environment and the potential impact on UK consumer confidence," Embley added.
Shares in LSL Property Services were down 0.2% at 254.00 pence on Tuesday.
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