Savills-backed hybrid estate agency Yopa has reported an operating loss of £30.4 million during 2018, an increase of 66%. It has also revealed that it has enough cash in the bank to keep going for another 12 months.
The company has blamed its rise in losses partly on the launch of its ‘No Sale, No Fee’ service in addition to its ‘Pay Now’ option. This has both reduced and deferred its expected turnover levels.
Yopa has also spent huge sums on expanding its customers service operation including a new contact centre in Watford and hiring more talent from the estate agency industry, all of which has nearly doubled its wage bill to £9.88 million.
Its customer service headcount increased from 38 during 2017 to 136 last year and its London head office also swelled from 59 to 64 staff.
The company’s accounts were drawn up by KPMG and reveal that Yopa has also signed up to both financial services and conveyancing partnerships to increase its product offering and drive more revenue in the future.
Despite its huge losses, the underlying business is growing. Revenue increased by 60% year-on-year to £6.8 million and its gross profit, before its £33 million overheads, increased 32% to £2.7 million.
Yopa also claims it would be doing better if it weren’t for Brexit.
“Given the political and economic uncertainty around Brexit and the recent appointment of a new prime minister there is a significant level of uncertainty in the market which has seen a year-on-year decline in housing market transactions,” it says.
“However, there remains sufficient opportunity for the business to grow and capture market share give its value proposition.”
In August Yopa was given another £20 million by investors including its biggest stakeholder, Savills.