The North East owner of Reeds Rains and Your Move has revealed profits are 3% ahead of last year, despite taking a hit from the Covid-19 crisis and the closure of scores of estate agency branches.
LSL Property Services has published interim results for the six months ended June 30, showing a 25% slide in group revenue, from £154.1m to £114.9m.
But the Newcastle listed firm, which also owns the Marsh & Parsons, LSLi and a range of insurance and asset management brand, said trading had been strong in June and July, following resilient performance during the Covid-19 lockdown.
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It said revenue was impacted by last year’s closure of 164 estate agency branches as it reshaped the Your Move and Reeds Rains networks, as well as the tenant fee ban introduced in June 2019.
However, group underlying operating profit was up by £300,000 to £12.5m over the same period last year. Within its financial services division, underlying operating profit rose 14% and it also increased by 3% within the estate agency division.
As of July 31 its said around 2,800 of the 3,300 furloughed employees had returned to work and more staff are being returned to work in August.
The board said current trading is strong, buoyed by the Government’s introduction of a stamp duty holiday for properties up to £500,000, and that it is now looking to secure market share during the rest of the year.
It said it is assessing opportunities to restart investment activities, including lettings books acquisitions, whilst taking full account of on-going risks to the markets.
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Executive and non-executive directors voluntary took a wage equivalenty to a third of salaries and fees on April 1 and that was still in place at the end of July. The salaries of other senior managers who agreed a voluntary reduction were reinstated at the start of July.
Simon Embley, group chairman, said: “I am pleased to confirm that LSL has performed extremely well, during a period of unprecedented uncertainty and disruption. This is testament to the underlying strength of the group, and its ability to respond quickly and effectively to rapidly changing market conditions.
“After a strong first quarter, we reacted decisively to the emergence of the Covid-19 virus, managing our operations and cash position to secure the position of the Group, even in the event of the lockdown continuing throughout the year.
“This same agility served us well as restrictions eased, as we rebuilt our capability quickly to trade strongly throughout June.
“As a result, I can report an underlying operating profit slightly ahead of last year, and in so doing I cannot highlight strongly enough the exceptional contribution made by management and staff working in all parts of the group.
“Although we remain alert to the risk of more disruption, and will take prompt action should it occur, I am increasingly optimistic about market conditions, and am confident in our ability to compete successfully.
“Our focus is increasingly turning to investing for future growth, as well as optimising current performance. We have performed extremely well in 2020, and I am confident about the future prospects of the group.”