Foxtons finally feels the ‘Gittins gold’ as profits surge 10%
Estate agency puts the bad old days behind it as recently-installed CEO says his strategies are working.
The bad old days of disastrous results for Foxtons are behind the company as both a super-hot lettings market and a revived sales team have pushed revenues up by 9% and profits by 10%, its latest results show.
Revenue increased by £5 million to £70 million year-on-year while operating profit increased by £600,000 to £6.8 million.
But as CEO Guy Gittins makes clear in his comments, it is lettings that has largely helped the company produce such good results.
Lettings revenue grew by 26% to £49.8m, including £5.6m (+14%) of organic growth and £2.7m of incremental contribution from acquisitions.
The company has bought several boutique lettings agencies and/or portfolios recently as well as last year’s purchase of Douglas & Gordon.
“Our continued focus on growing non-cyclical and recurring revenues is working and has enabled us to deliver strong revenue and profit growth despite a challenging sales market and investing in recruiting more fee earners,” he says.
Growth tragectory
“Our Lettings business continued its growth trajectory, with double digit organic growth delivered in a competitive market. In Sales, although revenues were down due to the September 2022 mini-budget, which impacted the under-offer pipeline at the start of the year, we significantly grew market share, rebuilt the pipeline at the fastest rate in the last 5 years and agreed a similar level of new sales as last year, despite challenging market conditions.
Dream
Commenting on the deal, Julie Palmer, partner at Begbies Traynor (pictured), says: “The shortage of rental properties means that finding somewhere to live is an ordeal for tenants but it is a dream for London-focused estate agency Foxtons.
“With more than 27,000 rental properties on its books, Foxtons has shrugged off rising interest rates slowing the sales market, with the lettings business more than making up the difference.
“That’s something unlikely to change in the near term with the company noting that the imbalance between supply and demand of rental properties is at the highest level the agency has ever seen.”
