Countrywide has told Estate Agent Today that it will not be releasing any figures on the branch closure programme it introduced in the first half of 2019.
A trading statement yesterday made clear the company had spent £1.3m on redundancy costs during the first six months of the year, but the firm is refusing to reveal how many jobs or branches have been lost.
Paul Creffield, group managing director of Countrywide, has shared with EAT the philosophy behind the closures.
He said that each branch was looked at in turn in the light of “balancing our network with the demands of the market.”
Explaining that managing a business the size of Countrywide would be more demanding than usual in a climate of economic and political uncertainty thanks to Brexit, Creffield said: “Obviously with such a large network there have been some branches which have been barely breaking even, even in a good market. We had to look closely at those.”
He continued: “We also looked closely at where there were two competing Countrywide branches on the same High Street. I’m not talking about, say, Hamptons International and Bairstow Eves, because they’re aiming at different markets, but where two offices were directly competing against each other for the same business.”
Creffield said those unnecessary competitions have almost entirely been eliminated and the branches merged.
He suggested there may be “a handful” of branches still to close their doors, but discussions surrounding them were already taking place and any closures in the immediate future would be just “mopping up”.
Creffield told EAT: “I can never rule out another closure” but he insisted the current programme had now been concluded and it had contributed to what he described as an optimistic second half of the year in prospect for Countrywide.
The closures, which are believed to have been concentrated in the Home Counties and areas in the south and west of England, were not part of Countrywide’s deal with its lenders which was also announced in yesterday’s trading statement to shareholders by the company.
Creffield says operational issues such as the closure programme were not “run past” the lenders, and the closures and the renegotiation of the covenant deals with lenders were separate and independently-conducted exercises.
However, there was possible wriggle room left for Countrywide to decide what to do with its commercial arm, Lambert Smith Hampton: under the former leadership of departed chief executive Alison Platt, LSH was rumoured to be up for sale, but after she left Creffield was adamant that it would remain part of the Countrywide group.
But this week’s trading statement had a grim paragraph about LSH: “With the UK economy experiencing heightened political uncertainty and Brexit postponed until 31 October 2019, the UK investment market has seen a sharp slowing down in the first half of the year. Consequently Lambert Smith Hampton saw a first half year on year decrease of 20 per cent in transactional revenue, leading to an overall decrease of nine per cent in total revenue, and £5 million decline in adjusted EBITDA.”
So might LSH be put up for sale after all? EAT asked Creffield. His response perhaps begged more questions than answers when he said: ”We are not transacting LSH at this moment in time.”