LSL shares jump as estate agent chain expects ‘significant’ rise in full-year profit
Shares in estate agent chain LSL Property Services jumped this morning after the London-listed firm announced profit for 2020 will be “significantly” ahead of the previous year.
LSL’s stock rose more than six per cent to 272p following its announcement that full-year group underlying operating profit is expected to be £41.5m, beating 2019 levels.
The figure does not take Covid-related costs into account, and includes money received through the government’s furlough scheme.
Group revenue for the year is expected to be down around 15 per cent to £266m due to the pandemic, the restructuring of its Your Move and Reeds Rains brands and the tenant fee ban introduced in 2019.
However there was a strong recovery following the easing of the first lockdown in May 2020, with revenue up 12 per cent in December compared to the year before.
LSL, which owns Your Move and Reeds Rains, said it benefited from strong mortgage completions, survey instructions and the completion of a contractual negotiation with a key lenger in relation to valuation services.
Mortgage completions in December were 23 per cent higher than the same month in 2019, while surveying revenue jumped 25 per cent.
Meanwhile residential sales exchange income was in line with expectations, and the pipeline at the end of the year was more than 65 per cent above 2019 levels.
“There is currently no evidence of a material increase in residential fall-through trends,” LSL said.
“We continue to monitor this closely”.
The company had net bank debt of around £2m at the end of 2020, down from £41.9m the previous year.
Adjusted for Covid-19 related payment deferrals, underlying net bank debt was around £17m.