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Purplebricks swings to profit on back of housing boom

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PLC () said it is taking a cautious view on where the UK housing market goes once the stamp duty holiday ends.

The market for sales is buoyant at the moment, said the online estate agent, with fall through rates ‘at their lowest in a long time, but with the very healthy demand currently outstripping new supply volumes’.

“We expect supply and demand to return to more of a balance post Summer,” it added, noting that a new pricing structure including a Money Back Guarantee and a simplified two-tier proposition launch this month.  

“As such, it is too early to quantify the benefit from the new pricing structures to the current financial year.

“Our current expectation is for FY22 EBITDA to be flat year-on-year, in line with market expectations, with these strategies expected to accelerate revenue growth and drive progress towards the Group’s medium-term targets over the next few years.”

Going forward, Purplebricks said it should be able to deliver medium-term annual revenue growth in excess of 20%.

Results for the year to end April 2021 reflected the booming housing market post the easing of coronavirus restrictions.

Revenues rose by 13% to £90.9mln, with the group swinging to an operating profit of £8.2mln from a loss of £5.7mln, while the AIM-listed group posted a pre-tax profit of £3.6mln.

Total fee income rose by 22% to £87.1mln with the number of instructions up 14% to 58,043 and picked up significantly once the market re-opened in mid-May 2020, said the statement.

Purplebricks added there was a 7% increase in the average revenue per instruction (ARPI) to £1,501 (FY20: £1,401) driven by last year’s price increases and additional products.

Cash at the year-end totalled £74mln following the ales of its Canadian business with all furloughed monies had now been repaid.



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