Purplebricks Group PLC (LON:PURP) reported underlying half-year profits up 110% thanks to a rush of new customers.
For the six months to end-October, 2020, the online estate agency reported a 6% decline in revenue to GBP44.2mln but a 6% rise in total fee income to GBP49.1mln.
Revenues fell despite a 8% rise in new instructions to 35,387 as the AIM-listed company’s revenue recognition policy means the impact of this increase in instruction volumes will come in the second half.
Underlying profits (EBITDA) for the half year more than doubled to GBP8.4mln, helped by lower staff and marketing costs.
Cash stood at GBP75.8mln at the end of October, up from GBP31mln at its April year end thanks to a GBP35mln boost from sale of its Canadian arm.
“This continued momentum demonstrates the strength of our technology-led business model and our ability to adapt quickly to a changing market,” said chief executive Vic Darvey in a statement alongside the results.
He said it the company had “never been more relevant”, with brand awareness at a high of 98%, strengthening the belief that “technology-led estate agency is continuing to emerge as the winning model”, with evidence that consumers are shifting towards apps and tech-based alternatives.
“We are now emerging from the pandemic in a very strong competitive position,” he added, with a strengthened leadership team and balance sheet putting the group in a position to accelerate its model and extend its market share, helped by investment in the business and trials of new pricing models.
Guidance for the full year has been raised, with the group now anticipating a full-year result in excess of the top end of the analyst consensus, which stands at GBP10.6mln.
The shares jumped 18% to 88.9p on Tuesday morning, though were still down more than 30% since the start of the year.
Analysts at UBS said the new guidance was a clear positive, but noted that the 4.8% market share of properties sold was down from the 5.1% this time last year, though average revenue per instruction was up 3% following previous price increases.
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