In a trading update for the six months to 30 June 2021, The Property Franchise Group described the period as ‘exceptional’ as profits increased sharply.

Revenue was significantly higher than for the same period in 2020, which was impacted by Covid, as well as 2019. The results, released this morning show that the company continues to benefit from the acquisition of Hunters, which completed on 19 March 2021.

Group revenue in the six months to 30 June 2021, increased by 111% on 2020. Like for like revenues (excluding those contributed from the acquisition of Hunters) for the period increased 35% on 2020 and 33% on 2019.

Highlights:

  • Group revenue increased 111% to £11.4m (2020: £5.4m)
    • 35% like for like increase to £7.2m
    • 33% like for like increase on 2019
  • Management Service Fees (“royalties”) increased 69% to £7.1m (2020: £4.2m)
    • 35% like for like increase to £5.7m
    • 23% like for like increase on 2019
  • Network income increased 118% to £89.4m (2020: £41.0m)
    • 38% like for like increase to £56.3m
  • Sales agreed pipeline increased 247% to £29.5m (2020: £8.5m)
    • 64% like for like increase to £14.0m
  • Managing 73,000 rental properties (2020: 58,000)
  • EweMove sold 37 new territories (2020: 6)
  • Net debt of £5.0m after borrowing £12.5m to fund the acquisition of Hunters (2020: £nil)

TPFG says that the government’s initiatives to support the housing market, coupled with remote working and demand for more space, has contributed to the continued growth of its network’s residential property sales for the period. Compared to the same period in 2020, this growth exceeds 100%. At the same time the average sales fee charged has increased by over 10% in the last year, in-line with increasing house prices. These two factors have driven the increase in network income and the Group’s revenue.

Robust sales agreed, comparable with 2020 and considerably higher than 2019, have continued post period end. With significant sales agreed pipelines typically converting into fees at 20% per month and the current level of sales agreed, TPFG remain optimistic about the sales market this year. Similarly, lettings income remains resilient, with a 7% like for like increase in MSF over the same period in 2020.

EweMove

EweMove, the Group’s hybrid estate agency, has continued to build on its brand positioning, with the sale of 37 new territories in the period setting a new record for the total number of territories operating of 149. This puts the Group well on track to achieve one of its core strategic aims: to double the size of EweMove territories to 230 by the end of 2022.

Hunters

The integration of Hunters continues to progress well. The Group says that today’s update demonstrates that the strategy to acquire an estate agent with a strong focus on sales was the right one. The strengths of its new enlarged team continue to complement one another as they forge ahead with our strategic initiatives to drive organic growth.

Gareth Samples

Given the Group’s strong first half trading performance and the continued favourable market dynamics outlined above, the company remains confident in a very strong trading performance for the full financial year.

Chief executive officer, Gareth Samples, commented: “We are delighted to report that the first six months of trading have been an exceptional period for the Group. The UK’s housing market has seen activity levels that I have not witnessed before in my career, supported by peoples’ desires to move homes.

“We had the resources and capabilities to make the most of the exceptionally busy housing market and deliver a first-class service to those looking to buy, sell and let. Prior to the start of this year, we had enhanced the Group’s senior management team and have continued to do so, offering our franchisees advice and support commensurate with their scale and ambitions. This, coupled with the acquisition of Hunters and our partnership with LSL, has undoubtedly supported us in our mission to be the UK’s leading property franchisor.”