UK Markets closed

Foxtons profits wiped out amid Brexit gloom on housing market

By Alys Key, Press Association City Reporter
The estate agent also closed six branches last year.

Estate agent Foxtons swung to a loss in 2018 as Brexit uncertainty weighed on London housing sales.

The company reported a loss before tax of £17.2 million last year, compared with a £6.5 million profit in 2017.

Revenue also declined by 5% to £111.5 million.

While the group’s letting business remained resilient, posting a 1% rise in revenue to £67 million, factors including political uncertainty led to lower activity in the sales division.

Sales revenue was down 15% to £36.2 million.

The closure of six branches in London also contributed to the loss, after the move incurred a charge of £15.7 million.

However Foxtons anticipates cost savings of around £3 million a year as a result of the measure.

The group also insisted it has no further plans for branch closures, despite the high rate of disappearances from the high street.

Although Foxtons said the outlook for sales remained unchanged due to ongoing uncertainty, chief executive Nic Budden was bullish on its long-term prospects.

“The overall fundamentals of Foxtons and our market are attractive,” he said.

“London is a desirable global city with a sophisticated and varied residential property market. Our brand is synonymous with London property and we have enhanced our offer in order to reinforce our lettings business and position our sales business for any upturn.”

Due to its failure to return a profit, Foxtons decided not to give its shareholders a full-year dividend.

Shares dipped 2.6% in early trading on Thursday.

Tom Stevenson, investment director from Fidelity Personal Investing’s share dealing service, said: “With Brexit uncertainty set to continue for even longer, the company has fallen back on bromides about how attractive the London property market is.

“Shareholders will ignore that and wait for people to start buying and selling again.”