Foxtons has this morning reported to shareholders that its sales revenue has improved - although both mortgage and lettings revenue have dropped.
Overall, revenue for the company was £14.8m in October and November - up two per cent on the same period last year.
Within this, sales revenue increased by 11 per cent to £5.4m as, in the words of the company, “the conversion of the sales pipeline into exchanges gathers momentum.”
However, lettings revenue was down 1.0 per cent over the same period to £8m with the company saying an increase in the volume of property it let being offset by reduced rents.
Mortgage broking was also down 14 per cent in this period, to just £1.3m.
This morning’s statement continues: “As a result of the improving revenue trend and the continued tight control of costs, the board now expects adjusted operating profit to be between £1.0m and £1.5m for the full year, up from an adjusted operating loss of £0.7m in 2019. The cash balance as at 31 December 2020 is expected to be in excess of £30m.”
Foxtons, which raised £22m from investors (in a so-called ‘placing’) continues: “The company's trading performance since the Placing has been better than expected, enabling us to progress our strategy and deploy capital on attractive opportunities, specifically £4.6m spent acquiring three lettings books this year. The results we have seen from these initial acquisitions are encouraging and have reinforced our belief that they present an attractive method of growing the business, improving profitability and delivering strong financial returns.
“We have a good pipeline of additional, similar opportunities, and expect to make further investments in the next 12 months, striking a balance between executing at pace and ensuring the integration of the acquired businesses goes smoothly.
“In addition to the capital required for further investment we have a strong cash position which gives us flexibility to manage further Covid-19 disruption and is sufficient for our working capital requirements.”
As a result of this, the company is launched a share buy-back scheme as a way of returning funds to shareholders “whose support we appreciated at a time of great uncertainty.”