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Connells Group announces resilient full year results

Leading estate agency and property services provider Connells Group today announces its results for the year ended 31 December 2020. The Group reports pre-tax profits of £51.8m (2019: £50.1m), EBITDA of £80.5m (2019: £76.3m) and total revenue of £375.0m, down 12% on the previous year (2019: £426.4m).  

Key performance indicators include:

  • Total house sale exchanges down 16%, a good performance given the housing market shut down;
  • Ended the year with largest market share of any UK estate agency group at 5.5%*;
  • Remained the largest new homes operator in the UK with nearly 8,000 new homes sold;
  • Mortgage Services generated £10.9bn worth of lending, despite fewer house sales;
  • Number of lettings properties under management maintained during the year, total lettings income down 4% largely due to the two month period of lockdown;
  • Survey and valuation significantly impacted by the lockdown, with volumes down 15% as surveyors were unable to carry out physical visits for over two months;
  • Conveyancing transactions down 20%

“Although we started the year positively, the ongoing pandemic and closure of the housing market for two months in the first lockdown impacted business significantly in 2020. Consequently, our total Group revenue was down by over £50m year on year,” says Connells Group CEO David Livesey. “Demonstrating our resilience and ability to react quickly to change, combined with a strong market, we recorded a healthy profit that is marginally ahead of last year, once again showing the strength in our diversified business model.”

In March, Connells Group closed its branch network and head offices in line with Government instructions, swiftly transitioning to remote working and operating flexibly to minimise impact and provide a seamless service to clients and customers. The Group’s guiding principle throughout its pandemic response has been to do what is right for its people and customers, ensuring their health, safety and wellbeing. To protect the business during this uncertain period and safeguard all jobs for the long term, the Group cut back on capital and discretionary spending, the Executive Board waived their 2020 bonus entitlement, and the business made use of the Government’s Coronavirus Job Retention Scheme (CJRS) with 78% of its people placed on furlough. The Group safeguarded colleagues’ incomes during this time, going above and beyond the Government minimum, paying all its people 100% of basic salary and commission.

The Group rapidly planned its recovery, investing heavily for a swift, safe and Covid-Secure return to operations as the housing market reopened. The business saw a positive recovery on the initial reopening of the housing market in May, with improved activity levels buoyed by pent up demand and the stamp duty holiday.

“We are immensely proud of our people, how they have adapted to and supported the new ways of working together and the sense of unity throughout a year of national crisis,” says David. “It has been a massively uncertain time for everyone and we are grateful for their unswerving commitment to the business. With their support, we have pulled together to secure the safety of the team, to look after our customers and safeguard the company.”

The Group continues to explore opportunities for expansion either through acquisition or organic growth, and completed on four acquisitions in 2020. Most notably, the business announced on 31st December that it had reached an agreement with the board of Countrywide plc to acquire the business. Countrywide’s shareholders have voted overwhelmingly in support of the transaction and completion is expected to occur by the end of the first quarter of 2021, subject to FCA approval and the sanction of the Court.

“This is an exciting next chapter for us and we very much look forward to welcoming our new colleagues into the Group,” says David. “We believe in a well-invested high street branch network that utilises the best in technology, and we look forward to investing in and enhancing the Countrywide business for our shared success.

“We enter 2021 in good shape, with Connells Group financially strong and well poised to meet the opportunities and any challenges in the market,” concludes David.

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