LSL agency franchisees benefiting from ‘reduced vol...

LSL has hailed the benefits of switching to a franchise model for its estate agency brand.

A trading update from the company ahead of its full-year results, said cumulative profit over the first two months of the year was around £1m compared with losses of £1.5m and £2m for the same period in 2023 and 2022 respectively.

It said: “Early performance in 2024 reflects the benefit of the reduced volatility of the franchising model.”

The brand announced in May 2023 that its network of 183 branches will become franchises as part of a strategic review of its business to simplify the group and reduce costs.

Overall, LSL said group underlying operating profit is “materially ahead” of the board's previous expectations and around £7.5m ahead of the same period in 2023 and around £2.5m above 2022, “reflecting in particular very strong trading in the surveying and valuation division.”

LSL said there has been a “material and sustained increase in valuation instructions” since January 2024

Across the first two months of the year, surveying and valuation income per day was 50% higher than for the equivalent period in 2023 and in February was at its highest level since the market disruption that followed the mini Budget in October 2022, and approaching the very strong performance recorded in the first quarter of 2022.

Mortgage completions were in line with expectations, LSL said, while mortgage applications over the first two months of the year are “significantly ahead of expectations” with February mortgage applications per day 23% higher than 2023 and 5% above the strong performance in 2022.

LSL said: “Whilst commentators have pointed to improving conditions in the mortgage and housing markets, it remains difficult to predict the future path of these with confidence.

“However, early trading reaffirms the board's confidence that profits in 2024 will be materially ahead of 2023. The earlier than expected recovery means that even at this stage of the year, the board's expectations for the full year have increased.”

https://www.investegate.co.uk/announcement/rns/lsl-property-services--lsl/trading-update/8072668