Property group to ’emerge stronger from industry shakeout’

Online estate agent Purplebricks has reported a 20% growth in UK revenues for the half year while revealing it has £100m net cash to exercise “relentless innovation” and benefit from an industry shake-out that will “expose undercapitalised traditional and online competitors”.

For the six months to the end of October, Purplebricks saw group revenue jump 75% to £70.1m, while UK revenue rose 39% to £48.3m, while what it calls ‘UK ancillary revenue’ rose 25%.

However, adjusted EBITDA losses widened to £21m from a £9.9m loss, which it attributed to its focus on growing the business through heavy investment, and the cost of its early stage roll-out in the US.

The company, which is on course for full year revenues of between £165m and £185m, says it completed on £5.4bn of UK property in the six months, compared to £4.6bn in the corresponding period.

Chief executive Michael Bruce emphasised his confidence that the business would “emerge stronger” from what he called an “industry shake-out”, which recently claimed rival Emoov as a casualty.

Last week Emoov and its subsidiary Tepilo went into administration, citing cashflow problems.

Bruce said: “Our UK business continues to make good progress, with strong sales growth, market share gains and a step-up in both profitability and positive cashflow. It is this strength that will see Purplebricks emerge stronger from the ongoing industry shakeout, which is expected to continue to expose undercapitalised traditional and online competitors.

“Following Axel Springer’s investment in March, we are already seeing how shared knowledge and best practice across the business can benefit the entire group.

“We are always looking to improve the customer experience and with over £100m of net cash, we are uniquely placed to do so, investing in technology and first class people. We remain confident that our UK success will be replicated internationally and that we will deliver substantial value for our shareholders.”