Winkworth reveals weak results as it struggles to repeat post-Covid success
The company recorded 2022 revenue and pre-tax profits that were higher than 2019 figures, but down compared to the previous year.
Winkworth has revealed lacklustre final results this morning and although they’re in line with management expectations the figures fall well below the boom levels of 2021.
The company recorded 2022 revenue and pre-tax profits that were higher than 2019 figures, but down compared to the previous year.
Fanchised office network revenue was down 3% to £63.1 million (2021: £64.8 million) with sales revenues 54% of total revenues (2021: 60%).
Winkworth did however deliver a clean balance sheet, with a year-end cash balance of £5.25m, slightly up from £5.02m in 2021, and no debt.
New offices
The company opened two new offices in 2022, down from six in 2021, and declared ordinary dividends of 11.0p per share, up from 9.3p the previous year, excluding special dividends.
CEO Dominic Agace (main picture) says that after an exceptionally strong performance in sales in 2021, the company continued to make good progress across the business in 2022, especially in lettings and management.
He also said the company delivered a set of results that were very satisfactory against a background that was at times challenging. He added that many of the company’s key metrics for 2022 were up by some 50% on 2019, the pre-pandemic year.
Agace expressed optimism for 2023, stating that although the outcome for the current year was shrouded, a ‘re-based’ market was emerging, now that mortgage rates have fallen from their peak and are settling at more historic norms of around 4%.
Rents stable
He also says rental prices are showing greater stability and that the company expects a further healthy contribution from its lettings and management business in 2023.
Agace adds:“After an exceptionally strong performance in sales in 2021, we continued to make good progress across the business in 2022, in lettings and management in particular, and have delivered a set of results which we consider to be very satisfactory against a background that was at times challenging. Many of our key metrics for 2022 are up by some 50% on 2019, the pre-pandemic year.
“While the outcome for the current year is shrouded, now that mortgages rates having fallen from their peak and are settling at more historic norms of around 4%, we see a rebased market emerging. Rental prices are showing greater stability and we expect a further healthy contribution from our lettings and management business in 2023.”
Analysis
Andy Murphy, Director at Edison Group
“Shareholders of heritage estate agent Winkworth will most likely be underwhelmed by this morning’s lacklustre full-year results, at least those who had overlooked management’s rather conservative forecast expectations and expected some magic to have turned the dial on the downward trending network and sales revenue.
“Citing a post-lockdown boom in real estate activity, both in lettings and sales, which was seen in the second half of 2021 and in 2022, such energy has faded as the rough economic situation became clear in H2 2022.
“However, management is confident that the results, given the backdrop, which have been challenging across the board, remain strong.”
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