Repossessions, lettings and surveying come through for Your Move owner

LSL Property Services, which operates under the Your Move and Reeds Rains estate agency brand, has announced pre-tax losses of £4.8m as the group continues to be affected by the current housing market slump.

In 2007, the group, which has its executive management team based in York, reported pre-tax profits of £22.3m.

Today it reported that underlying group operating profit had fallen from £37.2m in 2007 to £18.2m for the year ended December 31, 2008.

Group revenue dropped 26% to £161.8m compared to £219.5m the year before.

Exceptional costs for the period are £8.2m (2007: £1.4m), primarily due LSL said to reorganisation and restructuring costs necessary to reduce operating costs in line with lower activity levels.

Adjusted Basic Earnings Per Share2 (EPS) of 9.8p per share (2007, 23.4p per share). Basic loss per share was 3.3p per share (2007, basic EPS was 15.8p).

No final dividend has been declared (2007, total dividend 6.86p).

LSL said that its estate agency and financial services operations reflected market conditions with underlying operating losses for the period of £8.4m compared to profits of £13m the year before.

Transaction volumes in the housing market reached a record low of 512,000 transactions in 2008 compared to more than a million in 2007.

The volumes of mortgage approvals, a principal driver of LSL’s surveying business, were supported by a strong re-mortgage market in the first half of 2008, but then fell significantly in the second half, as the availability of credit was further compounded by the escalation of the banking crisis.

However, the group said that banking facilities of £75m had been extended to July 2011 and that other parts of its group were performing well.

It said that non-exchange income such as lettings and repossessions in its core estate agency brands were up 17% to £29.2m.

Lettings income from our core brands Your Move and Reeds Rains, increased by 24%, to £15.8m and within those brands – despite a 59% fall in exchange income – overall revenue fell by only 39%.

LSL’s newly founded Corporate Client Department business has seen a strong start after securing a number of “substantial” new contracts and is trading profitably.

Its surveying business continues to make progress, underpinned by the major contract gains achieved in 2007,with Barclays and C&G.

Despite a 40% decline in mortgage approvals, the surveying business has continued to provide service excellence and to grow market share.

Overall the volume of jobs performed is down by 13% from 533,903 to 461,403. The result has been supported by the first full year of trading of Barnwoods which delivered turnover of £21.7m (200, £11.4m).

Roger Matthews, LSL’s chairman said: “Given the current macroeconomic environment, the board remains cautious on market conditions for 2009 and the timing of any recovery is uncertain.

“In 2009 to date, buyer enquiries and activity levels within our estate agency businesses have been encouraging, however this is balanced by the lack of supply in the mortgage market.”

He added: “The group is well placed to benefit from the actions taken in 2008 with significantly reduced operating costs, strong growth in new income streams, and a diversified customer base which will underpin surveying profitability.”