REG - Belvoir Group PLC - AGM Trading Update

BelvoirAnnouncement

18/05/2023 07:00

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RNS Number : 7936Z  Belvoir Group PLC  18 May 2023

   18 May 2023

 
 

 

BELVOIR GROUP PLC

(the "Group", or "Belvoir")

 

AGM Trading Update

Trading in line with management expectations

 

 

Belvoir Group PLC (AIM: BLV), a leading UK property franchise and financial
services Group, provides the following update on current trading ahead of the
Group's Annual General Meeting to be held at 10:00 a.m. today.

 

The Board is pleased to report that trading to date is in line with
management's expectations for the year to 31 December 2023.

 

The Group's performance continues to be very resilient despite the uncertainty
in the housing market created by the mini budget in Q4 2022 and subsequent
increases in interest rates. Growth in our recurring lettings income is
benefiting from ongoing high levels of tenant demand with rents on new
tenancies increasing by 9.9%(1). Meanwhile, our successful assisted
acquisitions strategy has seen our franchisees acquire both lettings
portfolios and estate agency businesses. In 2023 to date, the Group has
supported eight franchisees to acquire a local competitor with combined
historic turnover of £2.4m and adding over 1,000 managed properties to the
Group.

 

Management Service Fees ("MSF"), the Group's key underlying revenue stream
from its property franchise division, was up 5% in the period to April 2023
against last year. MSF from lettings increased by 7% against the most recent
ONS rental index of 4.9%(2). Meanwhile MSF from sales was 4% lower than 2022,
as forecast, compared with a 15%(3) reduction in UK housing transactions in
the first quarter of 2023. This reflects our traditional lettings franchise
brands, Belvoir and Northwood, continuing to strengthen their estate agency
offering.

 

Gross profit from the financial services division in the first four months of
2023 increased by 8% with growth of 20% attributable to The TIME Group,
acquired May 2022, more than compensating for a fall of 12%, as forecast, in
the underlying financial services business. Our financial services advisers
continue to draw on their substantial client banks to sell remortgages and
protection products during a period in which there has been a lower level of
demand for new house purchase mortgages.

 

A degree of stability has returned to the mortgage market following the
paralysis in the immediate aftermath of the mini budget. Mortgage rates have
settled back down albeit reflecting the increased base rate and lenders have
returned to the market with more competitive deals. Fixed term mortgage rates
have eased down from their highs of October 2022 with pricing improving across
the loan-to-value spectrum.

 

The lag in the home buying process means that the impact of the mini budget on
market sentiment is still being felt given the reduction in vendor
instructions and a lower level of homes available to buy during the first
quarter of 2023. However, there are signs that the fall in demand for property
triggered last Autumn might be bottoming out. Mortgage approvals rose in both
February and March, and recent indices suggesting that house prices are
stabilizing will improve buyer confidence as the market enters its crucial
Spring/Summer season.

 

 

Dorian Gonsalves, CEO of Belvoir Group, commented:

"Our resilient performance in 2023 to date is in line with management
expectations and reflects our continued focus on supporting our franchisee and
mortgage adviser networks, alongside our acquisition led growth strategy. With
the Group now in a net cash position, it is well-placed to secure good quality
earnings accretive businesses that are complementary to the Group. The Board
remains confident that its business model and its track record in delivering
growth present a strong investment case to investors and will continue to
deliver value to all stakeholders."

 

 

1    https://homelet.co.uk/homelet-rental-index

2
https://www.ons.gov.uk/economy/inflationandpriceindices/datasets/indexofprivatehousingrentalpricesreferencetables

3
https://www.gov.uk/government/statistics/monthly-property-transactions-completed-in-the-uk-with-value-40000-or-above

 

For further details:

 Belvoir Group PLC                                      01476 584900

 Dorian Gonsalves, Chief Executive Officer             investorrelations@belvoirgroup.com

 Louise George, Chief Financial Officer

 www.belvoirgroup.co (http://www.belvoirgroup.com) m
 (http://www.belvoirgroup.com)

 finnCap                                                                         +44 (0) 20 7220 0500

 Julian Blunt, Teddy Whiley (Corporate Finance)

 Tim Redfern (ECM)

 www.finncap.com (http://www.finncap.com)

 Buchanan                                                                        +44 (0) 20 7466 5000

 Charles Ryland, Jack Devoy

Notes to editors:

About Belvoir Group PLC

Founded in 1995 and listed on AIM in 2012 (BLV.L), Belvoir operates a
nationwide property franchise Group with 487 offices across seven brands
specialising in residential lettings, property management, residential sales
and property-related financial services. With its Central Office in Grantham,
Lincolnshire, the Group manages 75,500 properties and reported record revenues
of £33.7m in 2022 marking Belvoir's 26(th) year of unbroken profit growth.

For further information, please visit: www.belvoirgroup.com
(http://www.belvoirgroup.com/)

 

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