The Property Franchise Group, one of the UK’s largest property franchises, is pleased to announce its interim results for the period ended 30 June 2020, and an update on current trading.
Highlights
- Robust revenue of £5.4m (H1 2019: £5.4m), despite the closure and challenges caused by Covid-19
- Management Service Fees (“royalties”) of £4.2m (H1 2019: £4.6m)
- Operating margin held at 37% (H1 2019: 37%), demonstrating careful cost management
- Adjusted EBITDA* of £2.5m (H1 2019: £2.4m)
- Profit before tax remained stable at £2.0m (H1 2019: £2.0m)
- Very strong balance sheet with a net cash position of £6.1m at 30 June 2020 (30 June 2019: £2.8m). Net cash generated from operations of £2.2m (H1 2019: £2.2m)
- Interim dividend reinstated at 2.1p per share
- Tenanted managed properties increased to 58,000 (H1 2019: 56,000)
- Group remains heavily weighted towards lettings, accounting for 73% of Management Service Fees (H1 2019: 70%)
Current trading
- The traditional brands saw an extremely strong increase in activity in July:
o Sales agreed pipeline increased 25% over June 2020
o Total lets increased by 28% over June 2020
- EweMove also recorded very high levels of activity across the board in July, beating previous records:
o Sales listings increased 36% month-on month to reach 728 in July 2020, setting a new record
o Sales agreed increased 28% month-on-month to reach 519, another new record for the brand
o Website visits were double normal rates in July 2020 and actions taken, once on-site, more than doubled
- Management’s confidence underpins its decision to build momentum behind strategic growth initiatives, re-initiate forecasts and set out a number of mid-term strategic objectives
*After adding back the share-based payments charge
Gareth Samples, Chief Executive Officer of The Property Franchise Group, said:
“Whilst the first half of this year was unlike any other, I am delighted with the resilience our business has shown and the first-rate performance of our franchisees who responded decisively and navigated well through the unprecedented environment.
“Despite nearly two months of the first half spent operating under severe restrictions, and impacted by the tenant fee ban which came into force on 1 June 2019, we have demonstrated the true strength of our busines model. We have continued to generate high levels of revenue, held profit before tax stable at £2.0m, increased our cash balances and subsequently reinstated an interim dividend.
“The substantial increase in activity we recorded in June has continued, with record performances continuing to be set across both the lettings and sales markets in July. Whilst the future remains uncertain, what this period of volatility has shown is that we are both a robust business in the face of adversity as well as a market leader able to reap the rewards in better times. We are focussed on maximising the opportunities that the market currently presents with a clear focus to deliver on the execution of our key strategic growth initiatives.”
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