Profits at Martin & Co slipped despite record revenues, as costs soared.

The franchise firm has reported pre-tax profits of £796,255 for the first six months of this year, down from £833,118 for the same period last year.

Revenue was up at £2,268,978 compared with £1,954,235, but the company’s main costs jumped from £87,239 to £191,609. Other costs were also up, including those of a regional franchise team.

The business now has 145 offices offering estate agency services as well as lettings – out of a total network of 193.

Earnings from estate agency were just over £1m at £1,013,221 – more than double what was earned from estate agency in the first six months of last year.

Lettings – Martin & Co’s traditional activity – were busy, despite a 13% drop in instructions.

This was compensated for by a rapid churn of tenants, with a record number vacating, with the properties re-let to new tenants, generating re-letting fees and commission income.

Martin & Co’s managed property portfolio was 30,902, up from 29,704 a year ago.

The report to shareholders also mentions Martin & Co’s acquisition in June of Village Estates in Saltaire, West Yorkshire, but notes that progress on its acquisition programme was disappointing and “slower than expected”.

It said this was because sellers’ price expectations were too high.

Martin & Co also mentions its launch of an online estate agency service at the start of this month, to run alongside its traditional high street offering.

In the six months to the end of June, it also recruited 12 new franchisees, and completed the roll-out of new cloud-based operating software.

Chief executive Ian Wilson said: “The business has traditionally performed more strongly in the second half of the year, with an influx of franchise inquiries in September and October leading to new lettings.

“We also expect that our new estate agency operation will continue to make good progress in spite of a market where very strong recent growth rates have slowed somewhat.”

The results are the first to be announced by the company since it joined the AIM stock market, and despite the fall in profitability, it plans to make its first dividend payment of 1.3p per share on September 30.

This morning arch rival Belvoir is due to announce its results.