Acquisitions pay off for Belvoir but group warns on profits
Lincolnshire-based Belvoir Group has revealed it notched up record revenues of £33.5m last year – but the estate agency has also warned that its profits are likely to fall “slightly below” 2022 levels over the next 12 months.
Ahead of its full-year results announcement, the firm told the London Stock Exchange it had seen a 13% increase in revenue despite an industry-wide decline in residential sales.
The company’s performance was boosted by the acquisitions of TIME Mortgage Services and Mr and Mrs Clarke, with the former contributing £2.6m to its coffers.
Revenue from Belvoir’s financial services division increased by 24% to £17.9m during the period, while its property division notched up £15.5m, an increase of 1%.
However, the impact of last year’s disastrous mini-budget is still being keenly felt by the firm and the industry at large.
In a statement, Belvoir said: “The Autumn statement reversed many of the fiscal initiatives proposed in the mini budget, which somewhat reassured borrowers and lenders. Whilst the level of sales instructions and mortgage applications to date in 2023 have shown signs of improvement compared with Q4 2022, the recovery is expected to build slowly over the year.
“Given the lead time from instruction to completion of a house sale and from mortgage application to drawdown can be up to five months, the improvement in activity in H1 is not likely to flow through into financial performance until H2. As a result, profitability in 2023 as a whole is likely to be slightly below 2022 and is expected to return to an upward trend in 2024.”
CEO Dorian Gonsalves said: “I am delighted to report that during 2022 our acquisition strategy both at Group and at franchisee level enabled Belvoir to both extend its service offering and mitigate the lower level of activity in the housing market following the exceptionally strong conditions in 2021.
“Our property franchisees and financial services advisers are highly motivated entrepreneurs who continue to demonstrate the ability to make the most of the opportunities presented in all market conditions. Our property franchisees benefit from significant recurring lettings revenue that contributes around 56% of Group gross profit and our financial services advisers have substantial client books from which to offer remortgages and other financial products, so are not entirely reliant on new mortgage business.”
Gonsalves added: “Whilst we anticipate continuing challenging market conditions in 2023, we remain confident that the resilience and diversity of our business model will enable the Group to perform well against the market as a whole. As always, the Board will continue to identify suitable acquisition targets to support continued growth and enhance shareholder value still further.”
