TIDMLSL
RNS Number : 2217V
LSL Property Services
02 December 2019
For immediate release 2 December 2019
LSL Property Services plc ("LSL")
Trading Update - 2019 Expectations Unchanged
LSL Property Services plc, a leading provider of residential
property services incorporating estate agency, financial services
and surveying businesses, issues a trading update for the period up
to 31(st) October 2019.
Group Performance and Outlook
The Board remains confident that the Group will deliver a full
year 2019 Group Underlying Operating Profit(1) in line with its
prior expectations.
Group revenues for the ten months ended 31(st) October 2019
decreased by 3% to GBP262.8m (2018: GBP270.5m) including the impact
of the reshaping of the Your Move and Reeds Rains branch networks
announced on 5(th) February 2019. Excluding the impact of the
planned closure of the Your Move and Reeds Rains branches during Q1
2019, Group revenues for the ten months ended 31(st) October 2019
increased by 5%.
The percentage change in revenue for the three months ended
30(th) September 2019, the four months ended 31(st) October 2019
and for the ten months ended 31(st) October 2019 compared to the
same time periods in 2018 is set out below:
3 months 4 months 10 months
to 30 to 31 to 31
Sept Oct Oct
Group as reported -7% -8% -3%
Group Like for
Like(2) +4% +3% +5%
Estate Agency as
reported(3,4) -19% -19% -16%
Estate Agency Like
for Like(2) -6% -5% -5%
Financial Services
as reported(3) -5% -4% +1%
Financial Services
organic excluding
Estate Agency +1% +2% +3%
Surveying +26% +18% +29%
Market backdrop
Market activity levels have remained subdued in 2019. The RICS
October 2019 Residential Market Survey results stated that there
continues to be a relatively subdued sales market backdrop,
evidenced by negative readings for indicators covering new buyer
enquiries, agreed sales and new instructions.
Estate Agency
For the four-month period ended 31(st) October 2019, Estate
Agency revenue was down by 19%, materially impacted by the planned
reduction in the size of the Your Move and Reeds Rains branch
networks during Q1 2019. Excluding the impact of the closure of the
Your Move and Reeds Rains branches, Estate Agency revenue(2) for
the four-month period was down 5%.
Whilst London market conditions continued to be challenging
during the four-month period, Marsh & Parsons delivered a
resilient revenue performance with total revenue down 4%.
Residential exchange income was flat and Lettings income declined
by 1%.
Financial Services
For the four-month period ended 31(st) October 2019, the
Financial Services Division organic revenue growth excluding Estate
Agency was 2%. Total Financial Services Division revenue including
Estate Agency for the four- month period was down by 4%, reflecting
the impact of the planned closure of the Your Move and Reeds Rains
branches.
The value of LSL's mortgage completions in the ten months to
31(st) October 2019 was GBP26.0bn, a 7% increase year on year, with
total appointed representative firms of 869 (31(st) October 2018:
856) and financial advisers of 2,339 (31(st) October 2018:
2,300).
Surveying
For the four-month period ended 31(st) October 2019, the
Surveying Division delivered a strong performance with revenue up
by 18%, which included a material contribution from the successful
commencement of the Lloyds Bank plc surveying and valuation
services relationship awarded in May 2018 and commenced in the
second half of September 2018.
Balance Sheet Update
Net Bank Debt at 31(st) October 2019 was GBP54.8m (2018:
GBP47.4m). The increase in Net Bank Debt of GBP7.4m year on year
includes the final payment for PTFS, the acquisition of six
Lettings Books and contingent consideration payments.
Commenting on today's announcement, Ian Crabb, Group CEO,
said:
"LSL has delivered a creditable performance in the 10 months to
31(st) October 2019. This performance has been delivered during a
period when market activity levels have remained subdued given the
continued uncertainty over the UK and global political and economic
environment. LSL's performance illustrates the benefits of the
Group's diversified strategy and the self-help initiatives being
taken to respond to current market conditions.
Until we have greater clarity on the political backdrop, we
remain cautious on the market outlook for 2020 and we will continue
to monitor market conditions closely. The Group's diversified
strategy combined with its robust balance sheet gives the Board
confidence of the opportunities for further positive progress for
the Group."
Notes to trading update
1. Group Underlying Operating Profit is before exceptional gains
and exceptional costs, contingent consideration, amortisation of
intangible assets and share--based payments.
2. Revenues have been restated on a like for like basis to
exclude the impact of the closure of the Your Move and Reeds Rains
branches during Q1 2019.
3. Following the change to LSL's segment reporting effective
from 1(st) January 2019, the Estate Agency Division receives a
commercially agreed commission payment from the Financial Services
segment. This arrangement reflects Financial Services income
generated from the Estate Agency segment. The 2018 revenue has been
restated on this basis to assist comparison.
4. Estate Agency Division revenue metrics presented in this
statement include Marsh & Parsons Revenue.
For further information, please
contact:
Ian Crabb, Group Chief Executive
Officer
Adam Castleton, Group Chief Financial
Officer
LSL Property Services plc 0207 382 0360
Helen Tarbet, Simon Compton
Buchanan 0207 466 5000
Notes on LSL:
LSL is a leading provider of residential property services to
its key customer groups. Services to consumers include: residential
sales, lettings, surveying, conveyancing support, and mortgage,
pure protection and general insurance brokerage services. Services
to mortgage lenders include: valuations and panel management
services, and asset management and property management services.
For further information, please visit LSL's website:
lslps.co.uk
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
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