REG - Property FranchiseGp - Half Year Trading Update

Property FranchiseAnnouncement

04/08/2022 07:15

For best results when printing this announcement, please click on link below:
http://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20220804:nRSD9055Ua&default-theme=true

RNS Number : 9055U  Property Franchise Group PLC (The)  04 August 2022

04 August 2022

 

THE PROPERTY FRANCHISE GROUP PLC

("TPFG", the "Company" or the "Group")

 

Half Year Trading Update

 

The Property Franchise Group PLC, the UK's largest property franchisor, is
pleased to provide the following trading update ahead of publishing its
interim results on Tuesday 13 September 2022.

 

The Group has achieved strong growth in the first half with revenue
significantly increasing vs H1 2021, despite 2021 having been a very strong
year for the residential housing market.

 

Highlights:

 

·      Group revenue increased 18% to £13.1m (H1 2021: £11.1m)

·      Management Service Fees ("royalties" or "MSF") increased 1% to
£7.4m (H1 2021: £7.3m)

·      Sales agreed pipeline increased 15% to £33.8m (H1 2021: £29.5m)

·      Managing 74,000 rental properties (H1 2021: 73,000)

·      EweMove sold 19 new territories (H1 2021: 37)

·      Net debt of £2.6m (31 Dec 2021: £5.0m), following another
period of strong cash generation

 

The growth in Group revenue was driven primarily by the acquisitions of
Hunters and Mortgage Genie in FY21, with revenue growth from the existing
businesses contributing £0.2m.

 

Management Service Fees increased 1% with the growth in lettings MSF of 12%
offsetting the reduction in sales MSF as the residential sales market
normalises. Sustained demand for lettings properties and rental inflation
means lettings MSF continues to be a highly resilient revenue stream for the
Group, contributing 55% of total MSF in the period.

 

Seasonally adjusted UK Property Transactions* at 621,000 for H1 2021 were 28%
lower than the same period last year, a trend reflected in our Group's
results. While our sales pipeline remains very healthy, lead times have
lengthened, and supply continues to be restricted. We still believe that our
forecast of 1.2m UK transactions for 2022 remains achievable and we expect H2
to generate a similar level of Sales MSF to H1.

 

EweMove and Hunters Personal, our two hybrid offerings, have performed well in
the first half, selling 24 new territories. We believe this model continues to
be attractive during more uncertain macro-economic times, allowing franchisees
to benefit from a low-cost base and increased flexibility.

 

Our network of franchisees continues to benefit from the strength and
experience of the senior management team, who are focused on the execution of
our six strategic growth initiatives. Support from an experienced central
team, dedicated to increasing business activity and profitability, is
invaluable during more challenging periods. In addition, we are confident that
further growth opportunities, for example the acquisition of lettings
portfolios, will arise over the next twelve months, which we are well
positioned to capitalise on.

 

 

*HMRC National Statistics 21 July 2022

 

 

Chief Executive Officer, Gareth Samples, commented:

 

"We are very pleased with the numbers announced today, particularly given the
increasingly uncertain macro backdrop. Our performance demonstrates the many
advantages of operating a focused franchise model, which has a multitude of
income streams, franchise brands and ways of meeting consumers' requirements.
Our team works tirelessly to help our franchisees navigate challenges and
explore growth opportunities. As such, the Board are confident that trading
remains in line with market expectations for the full year."

 

 

For further information, please contact:

 

 

 The Property Franchise Group PLC                           01202 405549

 Gareth Samples, Chief Executive Officer

 David Raggett, Chief Financial Officer

 Canaccord Genuity Limited (Nominated Adviser and Broker)   0207 523 8000

 Max Hartley

 Tom Diehl

 Alma PR                                                    0203 405 0209

 Susie Hudson

 Justine James

 Joe Pederzolli

 

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 (http://www.propertyfranchise.co.uk/)

 

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact
rns@lseg.com (mailto:rns@lseg.com)
 or visit
www.rns.com (http://www.rns.com/)
.

RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our
Privacy Policy (https://www.lseg.com/privacy-and-cookie-policy)
.   END  TSTFIFVETAISIIF