Foxtons’ results: Profits drop by 54% in 2016

Foxtons’ results for 2016 reveal a tough year for the company with revenue, profits, margin and earning per share all dropping dramatically.

The company blames the EU referendum, Stamp Duty changes and a difficult Central London property market for its dismal performance, which saw revenue down by 11.4% and profits before tax down by 54%.

Its revenues from sales were down by 23% to £55.5m but generation rent and London’s high house prices helped keep its lettings revenue relatively buoyant at £68.3m, down just 1%.

The only other bright spots on the horizon for the company are its balance sheet and mortgage business. The company has no debt and £9.5m in the bank, and saw revenues from its mortgage business Alexander Hall Associates, rise by 8% to £8.9 million.

CEO Nic Budden says that he expects the property market in London to remain “challenging” throughout 2017 and that sales volumes will be lower this year than 2016 if current market conditions continue.

Nic is also hanging his hopes on Foxtons being a technology-first company when the London market finally revives, revealing the company is to create a portal for its landlord customers similar to its MyFoxtons platform launched last year, which it bills as ‘like an online estate agent, but better’.

“[These are] exciting steps as we continue to evolve our offer, recognising the changing needs of our customers and the sales and lettings landscape,” he says.

“We have a clear strategy through these challenging market conditions, but one which also seeks to capitalise on the long term growth opportunity across London.”

Jitters in the City about the overall UK property, and in particular Foxtons’ poor performance in recent months, have seen its share price nosedive from £1.75 to today’s price of 95p.