Debt-free Foxtons ‘could report pre-tax losses of £3m’ article does not faze City

Foxtons’ share price yesterday shrugged off speculation that the firm will ‘go into the red’ when it announces its results for last year later this week.

Its share price rose some 3% to finish at around 59p.

This was despite a story in the Telegraph yesterday morning which said that this Thursday, Foxtons is “poised to report pre-tax losses of £3m” for last year, which the paper said would be down from a profit of £15m.

Sales, it said, are expected to fall from £118m to £111m.

The story, apparently based on Foxtons’ own latest trading update, adds that investors are braced for Foxtons to book £16m worth of one-off charges including £10m of goodwill write-down and £6m incurred in closing six branches, including its flagship Park Lane office.

For 2017, Foxtons reported pre-tax profits of £6.52m but adjusted EBITDA of £15.1m on revenues of £117.6m.

However, the firm reported pre-tax losses of £2.5m in the first half of last year.

In its trading update issued at the end of last year, ahead of this Thursday’s 2018 results, Foxtons itself said it expects to report revenues of £11m and adjusted EBITDA of £3m.

It did not refer to pre-tax profits or losses in that update, but the trading update did point out that Foxtons had cash of £17m as at the end of last year, supporting a strong balance sheet with no debt.

The Foxtons trading update also referred to the £16m charge for one-off costs, including £6m for branch closures, referenced in the Telegraph report.

Foxtons floated on the stock market in 2013, when its shares stood at 400p. They hit a low last year at 45.5p.

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5 Comments

  1. Property Poke In The Eye

    Most agents will be making a loss to keep afloat over the coming years.

    The lettings fee ban will take Foxtons off the edge as they will try and pass this loss of revenue to their landlord clients.  Which I believe may not accept the further fee increase and look to change agents.

    Foxtons in my opinion need to go back and concentrate of Zones 1,2 and 3 and get out of the other area they went into to.

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  2. HertsLocalagent

    ”Most agents will be making a loss to keep afloat over the coming years…”
    you guys need to keep the same energy with online agents. Replace foxtons with PB in this article and the keyboard agents would have their pitchforks out

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    1. htsnom79

      Why?

      Because Foxtons lose in twelve months what PB burn through in 90 days?

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  3. DarrelKwong43

    £10 million goodwill?

    Do these accountancy firms make these things up?

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  4. Chatty Cathy

    £10 million in goodwill??

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