TIDMTPFG
RNS Number : 2584T
Property Franchise Group PLC (The)
24 March 2021
24 March 2021
THE PROPERTY FRANCHISE GROUP PLC
("TPFG", the "Company" or the "Group")
FY20 Trading Update,
Notice of Final Results and Investor Presentation
The Property Franchise Group PLC, the UK's largest property
franchisor, completed the acquisition of Hunters Property plc on
Monday 22 March, and is pleased to provide a trading update for the
year ended 31 December 2020 ("FY20"), for the Group and
Hunters.
TPFG is now the leading property franchise group in the UK,
managing the second largest estate agency network and portfolio of
lettings properties.
FY20 Trading Update
FY20 was a volatile year for the estate and lettings agency
industry as companies navigated an unprecedented period of full
closure and various levels of restrictions for the remainder of the
year. While constructive Government initiatives such as the stamp
duty holiday had a positive impact on underlying activity levels,
extended lead times meant that this surge of activity will largely
flow through into fees in early 2021.
Both TPFG and Hunters performed very well despite the
circumstances, demonstrating the strength and resilience of the
franchise model and the quality of their respective management
teams.
As previously announced, both companies had a keen focus on cost
management over the year, as was prudent given the uncertain
environment, which together with stable revenues has led to a
positive impact on profitability.
The Property Franchise Group
-- Network income increased to GBP94m (2019: GBP93m)
-- Revenue increased to GBP11.5m (2019: GBP11.4m)
-- Management Service Fees of GBP9.4m (2019: GBP9.7m)
o 70% Lettings and 30% Sales
-- Average branch revenue of c.GBP333,000 (2019: c.GBP321,000) excluding EweMove
-- Tenanted managed properties remained stable at c.58,000 (2019: c.58,000)
-- Sales agreed pipeline at year-end almost double December 2019 at GBP10.3m (2019: GBP5.2m)
-- 11 assisted portfolio acquisitions by franchisees, adding 1,305 managed properties
-- The Group maintains a strong balance sheet, with net cash of
GBP8.8m* at the year-end (2019: net cash GBP4.0m)
Hunters
The highlights below relate to the year ended 31 December 2020,
prior to the completion of the acquisition.
-- Network income increased to GBP43m (2019: GBP42m)
-- Adjusted** revenue decreased by 4% to GBP12.5m (2019: GBP13.0m)
-- Management Service Fees of GBP3.4m (2019: GBP3.2m)
o 64% Sales and 36% Lettings
-- Average branch revenue of c.GBP207,000 (2019: c.GBP205,000)
-- Tenanted managed properties of c.15,000 (2019: c.14,000)
-- Sales agreed pipeline increased 84% to GBP17.3m (2019: GBP9.4m)
-- Improved balance strength with zero net debt at the year-end* (2019: net debt GBP3.2m)
*Unaudited
** Adjusted for offices franchised in 2020 and changes to portal
charging.
Current trading and Outlook
With the strong pipeline and momentum generated late FY20
continuing into the current year, TPFG and Hunters both came into
2021 with sales agreed pipelines in their networks up more than 80%
on the end of the prior year.
The sales pipeline has continued at strong levels. As a result,
at the end of February 2021, the sales agreed pipeline had only
reduced by 6% since the end of 2020, when they were at record
highs.
Sales agreed pipelines have also started to convert into
completions at faster rates. Consequently, TPFG and Hunters have
benefited from significantly increased turnover from sales
activities over the comparative period for FY20.
Sales valuations and listings, as well as Lettings' instructions
and lettings, have started more slowly in 2021 than they did in
2020 when we experienced the confidence following the UK general
election. However, the confirmation of the extension of the stamp
duty holiday by the Chancellor in his March 2021 Budget and the
intended easing of lockdown restrictions should both help to
improve performance over the coming months.
Underpinning the lettings income of both TPFG and Hunters is the
portfolio of managed properties which now stands at c73,000
properties.
Whilst the outlook for the UK economy remains difficult to
predict, we are confident that an exciting year of progress is
ahead of the Group. Aside from external market conditions, in the
year ahead TPFG looks forward to pursuing the new opportunities
available to it following the Hunters acquisition, leveraging its
significantly enhanced scale and continuing to execute on its
ambitious growth strategy.
Notice of Results and Investor Presentation
The Board intends to reinstate guidance for the enlarged Group
alongside the publication of its full year results for FY20 on 27
April 2021.
Gareth Samples, CEO, and David Raggett, CFO, will be hosting a
live private investor presentation on the results on Wednesday 28
April 2021 at 11.30am.
All existing and potential private investors interested in
attending are asked to register for free using the following link:
http://bit.ly/TPFG_Full_Year_Results_PresentationWebinar
Attendees will have the opportunity to ask questions to
Management as part of the event, with feedback collected following
the meeting. Any questions there is not time to answer live are
asked to be sent to propertyfranchise@almapr.co.uk and will be
responded to directly. A recording of the webinar will be posted
shortly after the event on the Company's website:
www.propertyfranchise.co.uk
Chief Executive Officer, Gareth Samples, commented,
"I am very pleased to be announcing strong results in 2020
delivered by both The Property Franchise Group and Hunters. Both
companies have demonstrated their strength and agility under
rapidly changing circumstances, progressing financially and
operationally in the year. We are confident that bringing a strong,
growing business into the Group will supercharge our expansion
plans, delivering great value for both our shareholders and our
franchisees.
We now have an unrivalled management team, geographical reach
and brand value within the Group. We are excited for what the
future holds."
For further information, please contact:
The Property Franchise Group PLC
Gareth Samples, Chief Executive Officer
David Raggett, Chief Financial Officer 01202 405549
Cenkos Securities plc (Nominated Adviser and Broker)
Max Hartley, Callum Davidson
Julian Morse (Sales) 0207 397 8900
Alma PR
Susie Hudson
Justine James
Harriet Jackson 0203 405 0209
About The Property Franchise Group PLC:
The Property Franchise Group PLC (AIM: TPFG) is the largest
property franchisor in the UK and manages the second largest estate
agency network and portfolio of lettings properties in the UK.
The Company was founded in 1986 and has since grown to a diverse
portfolio of nine brands operating throughout the UK, comprising
longstanding high-street focused brands and a hybrid, no sale no
fee agency.
The Property Franchise Group's brands are Martin & Co,
EweMove, Hunters, CJ Hole, Ellis & Co, Parkers, Whitegates,
Mullucks & Country Properties.
Headquartered in Bournemouth, UK, the Company was listed on AIM
on the London Stock Exchange in 2013. More information is available
at www.propertyfranchise.co.uk
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END
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