REG - LSL Property Svcs. - Trading Update

LSL Property ServicesAnnouncement

06/03/2024 07:00

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RNS Number : 7172F  LSL Property Services PLC  06 March 2024

 
            6 March 2024

 

LSL Property Services plc ("LSL" or "Group")

Trading Update

 

 2024 trading ahead of expectations

In advance of the 2023 Preliminary results, LSL issues a trading update for
the first two months of 2024.

Highlights

Following a positive final quarter in 2023, momentum has increased at the
start of the new financial year with positive activity levels across the
Group.

 

At the end of February 2024, Group Underlying Operating Profit(1) was
materially ahead of the Board's previous expectations and around £7.5m ahead
of the same period in 2023 and around £2.5m above 2022, reflecting in
particular very strong trading in the Surveying & Valuation Division.

 

Surveying & Valuation Division

From the middle of January there has been a material and sustained increase in
valuation instructions reflecting the benefit of contract wins as well as
increased market activity, and a reduced proportion of product transfer
business in the mortgage market.

 

Across the first two months of the year, Surveying & Valuation income per
day was 50% higher than for the equivalent period in 2023 and in February was
at its highest level since the market disruption that followed the mini budget
in October 2022, and approaching the very strong performance recorded in Q1
2022.

 

Financial Services Division

Mortgage completions were in line with our expectations, reflecting the
opening pipeline at 1 January 2024. Consistent with the surveying valuation
instructions, LSL mortgage applications over the first two months of the year
are significantly ahead of expectations with February mortgage applications
per day 23% higher than 2023 and 5% above the strong performance in 2022. The
benefit of these applications will be seen in completions during the first
half of the year.

 

Estate Agency Franchising Division

Early performance in 2024 reflects the benefit of the reduced volatility of
the franchising model. Cumulative profit over the first two months of the year
was around £1m compared to losses of £1.5m and £2m for the same period in
2023 and 2022 respectively.

 

Balance Sheet

The Group retains a strong balance sheet. Net Cash at 29 February 2024 was
c.£28m (31 December 2023: £34.9m) with the reduction reflecting the
acquisition of the TenetLime mortgage network which completed at the beginning
of February.

 

Outlook

Whilst commentators have pointed to improving conditions in the mortgage and
housing markets, it remains difficult to predict the future path of these with
confidence. However, early trading reaffirms the Board's confidence that
profits in 2024 will be materially ahead of 2023. The earlier than expected
recovery means that even at this stage of the year, the Board's expectations
for the full year have increased.

 

A further update on current trading, outlook and progress against our strategy
will be shared with the release of our Preliminary Results in April.

 

Board changes

We will move at pace to appoint an independent Chair who will work with the
Board to continue to maintain an open dialogue with shareholders, and drive
forward the evolution of our strategy, building on the steps taken in 2023 to
restructure the Group.

 

Notes to trading update:

1.         Group Underlying Operating Profit is including discontinued
operations, before exceptional costs, contingent consideration assets &
liabilities, amortisation of intangible assets and share-based payments

 

For further information, please contact:

 

 David Stewart, Group Chief Executive Officer
 Adam Castleton, Group Chief Financial Officer
 LSL Property Services plc                      investorrelations@lslps.co.uk (mailto:investorrelations@lslps.co.uk)

 Helen Tarbet
 Sophie Wills
 George Beale
 Buchanan                                       0207 466 5000 / LSL@buchanan.uk.com (mailto:LSL@buchanan.uk.com)

 

This announcement contains inside information.

 

Notes on LSL

LSL is one of the largest providers of services to mortgage intermediaries and
estate agent franchisees.

 

Its c.2,800 advisers represent around 11% of the total purchase and remortgage
market.

 

Its 61 estate agency franchisees operate in over 300 territories making it one
of the leading providers of estate agency franchise services in the UK with
leading local brands.

 

LSL is also one of the UK's largest providers of surveying and valuation
services, supplying seven out of the ten largest lenders in the UK.

 

For further information please visit LSL's website: lslps.co.uk
(http://www.lslps.co.uk/)

 

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