End of year financial results
Leading estate agency and property services provider Connells Group today announces its results for the year ended 31 December 2018. The Group reports EBITDA of £75.0m (2017: £80.1m), pre-tax profits of £56.9m (2017: £65.7m, excluding a gain on the sale of ZPG plc shares) and an EBITDA margin of 18% (2017: 19%). This is a solid result when set against the backdrop of a difficult year for the UK housing market and declining transaction volumes.
Key business highlights throughout the year include:
- Total Estate Agency house sale exchanges down 7% - a good result in a challenging market;
- Almost 9,000 new homes sold;
- Financial Services income up 10%, with £10.6bn worth of lending generated;
- Lettings income up 5%;
- Connells Survey & Valuation operating profit up 4%, a number of major contracts won and existing ones retained.
“2018 was a tough period for the property market with Brexit uncertainty continuing to weigh heavily on customers’ minds and depressed levels of UK housing transactions,” says Connells Group CEO David Livesey. “Despite this, our core estate agency business performed well and we continue to benefit from a strong and diverse business model which is resilient to market change. We are pleased to deliver another good performance and our results reflect the quality of our people and the flexibility of Connells Group to respond to all circumstances.”
Connells Group maintained its strategy of high level investment throughout 2018 to ensure its strong position for the future. This included further innovations in technology and proptech propositions to support and enhance the business’ offering, expanding and developing teams to provide the best service to customers and clients. Connells Group employs over 7,000 people and remains fully committed to its network of nearly 600 high street estate agency branches as demonstrated by the decision to close its online estate agency Hatched last year. This followed the conclusion that the ‘online-only’/hybrid business model does not produce a viable economic result nor give house sellers the best outcome as compared to the Group’s full service high street operation.
“We remain committed to expanding the Group – be it through acquisitions that add value to our business or organic growth – to support our strategy of remaining a market leader in both our core estate agency practice and our successful business to business activities,” continues David. “It has been, and remains, an uncertain time for those operating in the property sector and we pay tribute to the skill and tenacity of our staff, our greatest asset, who have faced the challenges head on to deliver another commendable performance.”