Half Year 2024 Foxtons Group PLC Earnings Call Transcript
Key Points
- Foxtons Group PLC (FXTGY) delivered revenue and profit growth despite a flat London sales market, driven by operational improvements.
- The company achieved a substantial 30% increase in sales exchange market share and double-digit growth in lettings new business volumes.
- Productivity improved with a 6% increase in revenue per fee earner and a 15% increase in revenue per branch.
- Noncyclical and recurring activities generated nearly 70% of revenue, enhancing business robustness.
- Foxtons Group PLC (FXTGY) completed the integration of Ludlow Thompson ahead of schedule, reflecting strong operational capabilities.
- The London sales market remains flat and at historically low levels, 15% below the 10-year average.
- The company faces ongoing cost pressures, including wage inflation and other cost inflation items.
- There is an expected temporary reduction in the volume of existing tenancies re-transacting due to longer tenancy terms.
- Despite revenue growth, the adjusted operating loss in sales narrowed but still remains a loss.
- The mortgage market remains challenging with elevated interest rates impacting financial services growth.
Good morning, everyone, and thank you for joining the Foxtons 2024 half year results presentation. I'm joined by Chris Hough, our Group CFO, and we look forward to answering any questions at the end of the call.
Before moving onto the body of the presentation, it's worth taking a minute to recap on the Foxtons journey over the last 24 months to really put these results into context. The group saw a multiyear period of underperformance from 2016 to 2022, including a significant market share loss, no organic growth in lettings and underinvestment in the business, all while focusing on the wrong strategic priorities.
Consequently, the business's financial performance suffered as reflected in the share price. Since then, the business has changed significantly led by a refreshed executive team, Chairman and Board of Directors. And at the beginning of 2023, I presented and implemented an operational turnaround plan, including a new set of strategic priorities with a medium term target to deliver GBP25 million to
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