Preliminary results for LSL Property Services reveal that pre-tax profits fell by 31% in the full-year ended 31 December 2019.
The parent company of Your Move and Reeds Rains did, however, see a “positive performance” with its group underlying operating profit, which rose 3% to £37m. Group adjusted EBITDA also rose by 25% to £51.9m.
The group’s estate agency division also delivered a “strong performance” with underlying operating profit up 30% to £14.5m, benefiting from the group’s reshaping of the Your Move and Reeds Rains branch networks.
The group said its fall in profits was “anticipated” following investments in exceptional costs to deliver the reshaping of Your Move and Reeds Rains last year. The reshaping reportedly “delivered a material year-on-year improvement” in Your Move and Reeds Rains operating profit.
Simon Embley, chairman of the group, said: “The group delivered a highly resilient revenue and underlying operating profit performance in 2019 in the context of challenging residential market conditions and the introduction of the tenant fee ban on 1st June 2019.
“Market conditions to date in 2020 have been encouraging, reflected by our estate agency sales pipeline at 29 February 2020 being £3.6m ahead of the board’s prior expectations, benefiting from a favourable estate agency net sales performance during January and February.”
In its latest statement, the group also issued a warning amid the current coronavirus threat, stating the situation could create “headwinds” for the business going forward.
Embley added: “Whilst we have been encouraged by the residential property market conditions to date in 2020, the situation regarding the COVID-19 virus is rapidly evolving and we have in recent days, seen some slight softening of our lead sales indicators in estate agency.
“We are monitoring the situation very closely as it may create headwinds for our business in 2020 if changes in consumer behaviour impact residential property market conditions. As and when any potential impact on the group becomes clearer, we will provide updates as necessary.”