Source - LSE Regulatory
RNS Number : 7710L
LSL Property Services PLC
15 January 2021
 

 For Immediate Release                                                                                                                                     15 January 2021

LSL Property Services plc ("LSL" or "Group")

 

FULL YEAR TRADING UPDATE

 

LSL reports very strong trading in December with full year 2020 Group Underlying Operating Profit expected to be significantly ahead of 2019

 

LSL, a leading provider of residential property services incorporating mortgage intermediation and other financial services, surveying and valuation businesses, and estate agency businesses, issues a trading update for the year ended 31 December 2020.

 

Highlights

·      Trading was stronger than our internal expectations in December in the Financial Services and Surveying Divisions, and we anticipate an improved Group Underlying Operating Profit(1) for the year ended 31 December 2020 of around £41.5m. This is stated before the recognition of Covid-19 related net costs and includes amounts received through the Government Coronavirus Job Retention Scheme

·      LSL particularly benefited in December from strong mortgage completions, strong Lender instructions for Surveys as well as the completion of a contractual negotiation with a key lender in relation to valuation services during H2  

·      In the Financial Services Division, total financial advisers at 31 December was 2,585, an increase of 8% year on year, with a strong pipeline of new advisers

·      LSL's PRIMIS mortgage completions in December were 23% higher than the same period in 2019

·      Surveying revenue in December was 25% higher than December 2019

·      In the Estate Agency Division, residential sales exchange income in December was in line with internal  expectations, with the residential sales exchange pipeline at 31 December more than 65% above the same date in 2019. There is currently no evidence of a material increase in residential fall-through trends. We continue to monitor this closely

·      Reported Net Bank Debt at 31 December 2020 is expected to be about £2m (2019: £41.9m). Adjusting for Covid-19 related payment deferrals, mainly in relation to tax payments due as agreed with HMRC, the underlying Net Banking Debt position at 31 December 2020 is about £17m

 

Financial performance

Group revenues for the 12 months ended 31 December 2020 are expected to decrease by around 15% to £266.0m (2020: £311.1m), being materially impacted by Covid-19, as well as the reshaping of the Your Move and Reeds Rains networks in February 2019, and the tenant fee ban introduced in June 2019. Following the easing of the first lockdown in May 2020, there has been a strong recovery in revenue throughout H2, with a particularly strong performance in December, with Group revenue up 12% compared to December 2019.    

COVID-19 update

The welfare and safety of our colleagues and customers continues to be afforded the highest priority, and the Group continues to apply the advice of the Government and public health authorities throughout our businesses and we will monitor closely any changes to the guidance as the course of Covid-19 evolves.

 

Following the announcement of the National Lockdown on 4 January 2021, the Government reiterated its intention to enable the housing market to operate as normally as possible, and the Group's financial services, surveying and estate agency operations remain open and operating in line with guidance.

 

Current trading & notice of results

We will provide details of current year trading with the release of our Preliminary results for the year ended 31 December 2020. We expect to report 2020 full year results on 9 March 2021.

 

This announcement has been determined to contain inside information.

 

Notes to trading update:

1.        Group Underlying Operating Profit is before exceptional costs, Covid-19 related net costs, contingent consideration, amortisation of intangible assets, share-based payments and includes circa £16m of amounts receivable pursuant to the Coronavirus Job Retention Scheme and utilised to pay employee salaries for those placed on furlough.

Covid-19 related net costs include property and other asset costs incurred while the lockdown was in place during 2020, and other costs including redundancy, and are net of property grants. This treatment was highlighted at the LSL Interim results. The total amount of Covid-19 related net costs in 2020 was circa £6.5m.

 

 

For further information, please contact:

 

David Stewart, Group Chief Executive Officer               

 

Adam Castleton, Group Chief Financial Officer

 

LSL Property Services plc                                               

investorrelations@lslps.co.uk

 

 

Helen Tarbet

 

Sophie Wills

 

Buchanan

0207 466 5000 / LSL@buchanan.uk.com

       

                                                                                                      

Notes on LSL

LSL is a leading provider of residential property services in three key markets: financial services, surveying and valuation services, and estate agency. Services to consumers and businesses include: mortgage and non-investment insurance brokerage and intermediary network services, residential sales, lettings, land and new homes, surveying, and conveyancing support. Services to mortgage lenders include: valuations and panel management services, and asset management and property management services. For further information, please visit LSL's website: lslps.co.uk

 

Forward Looking Statement

This announcement contains certain statements that are forward-looking statements. They appear in a number of places throughout this update and include statements regarding LSL's intentions, beliefs or current expectations and those of its officers, directors and employees concerning, amongst other things, LSL's results of operations, financial condition, liquidity, prospects, growth, strategies and the business it operates. By their nature, these statements involve uncertainty since future events and circumstances can cause results and developments to differ materially from those anticipated. The forward-looking statements reflect knowledge and information available at the date of preparation of this update and, unless otherwise required by applicable law, LSL undertakes no obligation to update or revise these forward-looking statements. Nothing in this update should be construed as a profit forecast. LSL and its Directors accept no liability to third parties in respect of this update save as would arise under English law.

 

Any forward-looking statements in this update speak only at the date of this announcement and LSL undertakes no obligation to update publicly or review any forward-looking statement to reflect new information or events, circumstances or developments after the date of this update.

 

 

 

 

 

 

 

 

 

 

 

 

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