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This is the perfect time for me to take a deep dive into Companies House’s annual results to compare how our industry colleagues are performing and what trends are emerging.
The latest full after-tax figures (unless stated) are for the year ending December 2022, and include slower house price growth, political uncertainty and the September 2022 mini-Budget. This reflects a difficult year for most businesses, contributing to a decline in transactions. .
My findings are:
+ The most surprising losses are: LSL property service, swinging from a profit of £61.9m in 2021 to a loss of £64m. In 2023, the company reorganized its 183 branches, including Reeds Rains and Your Move, into a franchise model. With a new focus on mortgages and financial services, it will be interesting to see what happens to the real estate brokerage business.
+ Profit decreases Connells Nationwide After acquiring Countrywide in March 2021, it grew by an astonishing 42.5%. I suspect the Countrywide curse is upon us again. Should the Board of Skipton Building Society, the owners of Skipton Building Society whose members are all mutually owned, be asking questions?
+ Chianti Holdings Co., Ltd. (formed from the merger of Linley & Simpson and Lomond Capital) has posted a loss of £19.8m, up from a loss of £15m in 2021. It paid £15.2m in interest costs and has a £91m bank loan and £73.2m. Shareholder financing. The problem with building a business on debt is that you have to pay it back.
+Andrews and partners Although it made a loss of £2.9m, following a loss of £2m in the previous year, Andrews Charitable Trust said in its accounts that it had sufficient financial resources if needed to operate as a going concern.
+ Leader Romanbecame part of the Platinum Equity portfolio in February 2022 and its ultimate parent company, Hadrian Holding Limited, posted a loss of £39.4m for the ten months ended 31 December 2022. are doing. The company is currently being refinanced, indicating that it has received interest-bearing bank financing. The amount to be paid is £304.8 million. Isn’t this high amount of debt certainly a cause for concern?
We have not yet proven the model for online-only and hybrid agents.
+Yopa lost £6.8m – 48% increase on 2021 loss of £4.6m. Group revenue fell from £18.7m to £17.7m. The company’s financial results reveal that there is “significant uncertainty” about its future as it relies on shareholder funding including Daily Mail Group Ventures and Grosvenor Hill Ventures. How long will these investors continue to show support?
+ Easy properties After Evolve’s bankruptcy in August 2022, it was returned to easyGroup. front door The online-only agent continues in the footsteps of Emoov, Tepilo, Hatched, House Network, and Purplebricks version 1. When will they learn?
+Strike’s The financial results for the end of March 2023 (before the purchase of Purplebricks for £1 in June 2023) are expected to be submitted by the end of April.As for the question, purple brick, I don’t see how they will survive with the “strike” free model. This model is unproven and the city doesn’t like it – and the city is usually right.
Which real estate company performs better than others?
+Foxtons It went from a loss of £6.2m in 2021 to a profit of £9.1m in 2022. To continue the recovery, Guy Gittins was appointed as his CEO in September 2022. Lettings grew by 17% and Financial Services by 8%, suggesting the strategy of prioritizing non-cyclical revenue growth is paying off.
+ Belboa Group (Franchise) had a record year, with sales up 14% and profits of £7.4m, up £23,000 on the previous year, despite higher cost of goods sold and administrative costs. Financial services grew by 26%, with the number of advisors increasing by 41 to 284.
+ Real estate franchise group (which recently merged with Belvoir) also showed significant growth, with profits more than doubling from £3.5m to £7.2m. The biggest factor in the increase in revenue was his £1.3m increase in financial services fees (to £1.7m).
This next selection of agents produced healthy profits, albeit down year over year.
+Savilles In 2022, the company made a profit of £84.5m compared to £89.2m in the previous year, and the group as a whole recorded a profit of £119.8m, down 18% from £146.7m. The company’s balance sheet remains strong.
+ Dexters Profit (to September 2022) was £24.1m, down 13% from £27.7m. Rental income he increased by 15% and on acquisitions he spent 6 million pounds. It is now part of Oakley Capital’s portfolio.
+ Carter Jonas Revenue (to April 2023) was £14m compared to £19m in 2022, primarily as the increase in revenue was offset by an increase in administrative costs of £8.6m.
+ Chesterton’s Profit for 2022 was £8.3m, down 12% from £9.4m. The number of rentals increased by 22%, mainly due to an increase in rental values. The estate agent’s revenue fell by 3%, but compared to the market’s 27% decline in London transactions, it remains in good shape.
+Arun (to September 2022) posted a profit of £7.7m, roughly on par with 2020 but below 2021’s record profit of £20.5m.
+ Kinley Folkard & Hayward It recorded a profit of £3.6 million, which was halved due to lower revenue.
+Winkworth (Franchise) profits fell from £2.6m to settle at £2m. Real estate brokerage revenues fell by 12%, but this was offset by his 11% increase in rental properties.
+ Prime Minister Profit fell from £3m to £423,000 as the company matched a £4.1m fall in revenue with just £0.9m in cost cuts.
We will report on all 2023 accounts as they are submitted. Most people will feel that 2023 has been a tough year, given the 14 consecutive interest rate hikes that have inevitably affected borrowing. Companies in our industry that have accumulated large amounts of debt to finance their operations will continue to suffer.
However, after two difficult years, we are now seeing a cyclical turnaround and are poised for a much improved 2024.
Paul Smith is Executive Chairman of Spicerhart