Countrywide this morning confirmed that it is to float on the London Stock Exchange, after releasing its results for last year and confirming its place as the UK’s number one estate agency.
It said that over the last six years – it left the stock market in 2007 when it sold into private hands just before the crash – it has been transformed from a collection of estate agencies into a ‘cohesive property services group’.
The float will raise around £200m in new shares and used to repay debt.
Despite mixed results in its core estate agency business – revenue overall declined by 1% to £211.2m, although in its Hamptons brand revenue bounced up 6% to £14.7m – the company has notably expanded.
While closing some under-performing branches, it opened 20 others. It also acquired 13 lettings businesses last year and opened 176 new lettings outlets. As a result, lettings recorded a record performance, growing 12% to £86.5m. Countrywide also announced a current budget of £20m for further acquisitions this year.
Profits before tax and other costs (EBITDA) were also up: in estate agency, they were up 9%, to £15.8m. In Hamptons, they were up 5%, to £15.5m. But the real star was lettings where they soared 41%, to £24.4m.
Overall, the group recorded a 6% rise in revenue to £529.8m last year, up from £509.1m the year before, with a highlight being financial services, where revenue grew 4% to £64.7m. The group arranged 54,000 mortgages last year, claiming 10% of the mortgage intermediary market.
The surveying and valuations arm of Countrywide also grew, by 8% in revenue, while conveyancing income went up by 14%.
Grenville Turner, group chief executive, said: “In a broadly flat housing market, albeit with some encouraging signs, we are delighted that our focus and drive in the lettings division – a key driver of our business – has continued to deliver strong momentum resulting in record financial performance in 2012.
“Buy-to-let landlords remain a rising force in the sector, as they seek to capitalise on the growing rental market as young adults and families struggle to get on the housing ladder.”
He went on: “The exact timing of a recovery in the UK residential market remains difficult to predict; however, we have seen an increase in mortgage approvals and an improvement in sentiment in the sector. Government initiatives to boost mortgage lending appear to be kicking in, as the Funding for Lending scheme helped lenders to lower interest rates and improve availability in the past few months.
“Over the last six years, Countrywide has been transformed into the UK’s largest integrated property services group. We capitalised upon significant growth opportunities via strategic acquisitions and high street branches to enjoy leading market share in all our core businesses. We are now embarking on a new chapter in our growth plans with continued investment in key strategic areas.
“We expect continuing resilience in house prices nationally and continued improvement in lender sentiment in 2013.
“Our estate agency division is positioned for a market recovery and our lettings division is well placed to benefit from the growth trend in the rental market.
“In Countrywide we have built a diversified business with strong prospects irrespective of any housing market recovery.
“With this in mind we view 2013 with confidence and look forward to the opportunities that lie ahead.”