6
March 2024
LSL Property Services plc ("LSL" or
"Group")
Trading Update
2024 trading ahead of
expectations
In advance of the 2023 Preliminary
results, LSL issues a trading update for the first two months of
2024.
Highlights
Following a positive final quarter in 2023,
momentum has increased at the start of the new financial year with
positive activity levels across the Group.
At the end of February 2024, Group Underlying
Operating Profit1 was materially ahead of the Board's
previous expectations and around £7.5m ahead of the same period in
2023 and around £2.5m above 2022, reflecting in particular very
strong trading in the Surveying & Valuation
Division.
Surveying
& Valuation Division
From the middle of January there has been a
material and sustained increase in valuation instructions
reflecting the benefit of contract wins as well as increased market
activity, and a reduced proportion of product transfer business in
the mortgage market.
Across the first two months of the year,
Surveying & Valuation income per day was 50% higher than for
the equivalent period in 2023 and in February was at its highest
level since the market disruption that followed the mini budget in
October 2022, and approaching the very strong performance recorded
in Q1 2022.
Financial
Services Division
Mortgage completions were in line with our
expectations, reflecting the opening pipeline at 1 January 2024.
Consistent with the surveying valuation instructions, LSL mortgage
applications over the first two months of the year are
significantly ahead of expectations with February mortgage
applications per day 23% higher than 2023 and 5% above the strong
performance in 2022. The benefit of these applications will be seen
in completions during the first half of the year.
Estate Agency
Franchising Division
Early performance in 2024 reflects the benefit
of the reduced volatility of the franchising model. Cumulative
profit over the first two months of the year was around £1m
compared to losses of £1.5m and £2m for the same period in 2023 and
2022 respectively.
Balance
Sheet
The Group retains a strong balance sheet. Net
Cash at 29 February 2024 was c.£28m (31 December 2023: £34.9m) with
the reduction reflecting the acquisition of the TenetLime mortgage
network which completed at the beginning of February.
Outlook
Whilst commentators have pointed to improving
conditions in the mortgage and housing markets, it remains
difficult to predict the future path of these with confidence.
However, early trading reaffirms the Board's confidence that
profits in 2024 will be materially ahead of 2023. The earlier than
expected recovery means that even at this stage of the year, the
Board's expectations for the full year have increased.
A further update on current trading, outlook
and progress against our strategy will be shared with the release
of our Preliminary Results in April.
Board
changes
We will move at pace to appoint an independent
Chair who will work with the Board to continue to maintain an open
dialogue with shareholders, and drive forward the evolution of our
strategy, building on the steps taken in 2023 to restructure the
Group.
Notes to trading update:
1. Group
Underlying Operating Profit is including discontinued operations,
before exceptional costs, contingent consideration assets &
liabilities, amortisation of intangible assets and share-based
payments
For further
information, please contact:
This announcement contains inside
information.
Notes
on LSL
LSL is one of the largest providers
of services to mortgage intermediaries and estate agent
franchisees.
Its c.2,800 advisers represent around
11% of the total purchase and remortgage market.
Its 61 estate agency franchisees
operate in over 300 territories making it one of the leading
providers of estate agency franchise services in the UK with
leading local brands.
LSL is also one of
the UK's largest providers of surveying and valuation
services, supplying seven out of the ten largest lenders in
the UK.
For further information please visit
LSL's website: lslps.co.uk