Purplebricks has revealed increased profits and turnover in the UK over the past six months but overall its worldwide performance has been dragged into the red by ongoing losses in Australia and the US.
In the UK it has switched to a new accounting system that has boosted its results, but using like-for-like comparisons revenues are up by 22% to £48.3 million and profits by 39% to £31.2 million. This is a gross profit margin of 64.6% on house sales worth £5.4 billion.
Its share of the hybrid market remains at 74%, although this is likely to increase significantly following the collapse of eMoov, which took place after Purplebricks accounting period ended. New instructions increased by 20% to 38,600 and the company now has 851 Local Property Experts in the UK with another 72 currently working through its training programme.
“Our UK business continues to make good progress, with strong sales growth, market share gains and a step-up in both profitability and positive cashflow,” says Michael Bruce, its group CEO (left).
“It is this strength that will see Purplebricks emerge stronger from the ongoing industry shakeout, which is expected to continue to expose undercapitalised traditional and online competitors.”
But the galloping performance of its UK business has been offset by ongoing problems in Australia and early-days performance in the US, both of which operated at a loss during the past six months.
This includes an operating loss of £10.2 million in Oz created in part by a 9% dip in new instructions. Referring to severe problems with its business model and the management of its LPE teams recently in Oz, Purplebricks says “lessons have been learned”.
“While reporting strong growth in Australia, the underlying performance was held back by market conditions and some operational issues, which we have taken steps to correct with changes to the team, customer proposition and business model,” the company says.
The US made an operating loss of £20.5 million, reflecting the huge costs the company is incurring as it tries to expand quickly across the US. These losses in the US and Australia dragged its group figures into the red, making a £25.6 million operating loss on revenues of £70.1 million.