Purplebricks hits back at analyst after share price dips

Online estate agency Purplebricks has hit back at claims that it only sells just over half the properties it has on its books.

Shares in the Solihull-based group dipped more than 3% yesterday after City analyst Jefferies International claimed the group only sold 51.6% of the properties on its books.

In a statement to the markets, Purplebricks said: “Purplebricks contests the findings of the Jefferies research report. Jefferies estimated Purplebricks’ completion rate is based on a single month’s data and does not include properties that have completed but have yet to be uploaded to the Land Registry, which can take several months.

“Equally the research does not take into account properties which have exchanged, have reached sold subject to contract (SSTC), or are on marketing breaks.

“Purplebricks reiterates its most recently published sales conversion rate from instruction to sale agreed of 78%, which it believes more accurately reflects its sales performance, although this figure itself does not include those properties in the sales pipeline at the end of the period which will in due course sell.

“Purplebricks firmly refutes the criticism in the research note of its revenue recognition policy and stands behind both the fully audited results and the accounting policy itself.”

The statement also included a trading update that said Purplebricks received 6,160 instructions in January 2018, up 66% year-on-year resulting in further overall market share growth.

Agreed sales in January 2018 were on 4,618 UK properties, and online market share increased during the month to 77%.

It said it had now sold and completed on over £10bn of UK property.

“With a few key months remaining, the board of Purplebricks is pleased with progress and confirms trading is in line with the board’s expectations for the year ending 30 April 2018,” it added.

Online estate agency Purplebricks has hit back at claims that it only sells just over half the properties it has on its books.

Shares in the Solihull-based group dipped more than 3% yesterday after City analyst Jefferies International claimed the group only sold 51.6% of the properties on its books.

In a statement to the markets, Purplebricks said: “Purplebricks contests the findings of the Jefferies research report. Jefferies estimated Purplebricks’ completion rate is based on a single month’s data and does not include properties that have completed but have yet to be uploaded to the Land Registry, which can take several months.

“Equally the research does not take into account properties which have exchanged, have reached sold subject to contract (SSTC), or are on marketing breaks.

“Purplebricks reiterates its most recently published sales conversion rate from instruction to sale agreed of 78%, which it believes more accurately reflects its sales performance, although this figure itself does not include those properties in the sales pipeline at the end of the period which will in due course sell.

“Purplebricks firmly refutes the criticism in the research note of its revenue recognition policy and stands behind both the fully audited results and the accounting policy itself.”

The statement also included a trading update that said Purplebricks received 6,160 instructions in January 2018, up 66% year-on-year resulting in further overall market share growth.

Agreed sales in January 2018 were on 4,618 UK properties, and online market share increased during the month to 77%.

It said it had now sold and completed on over £10bn of UK property.

“With a few key months remaining, the board of Purplebricks is pleased with progress and confirms trading is in line with the board’s expectations for the year ending 30 April 2018,” it added.