Woes continue as Purplebricks posts £52m loss
Purplebricks has revealed its annual results for the year ending April 30 2019 – writes Graham Norwood
The hybrid agency has posted an operating loss of £52.3 million, up from £27.8 million in 2018. It does, however, report a UK operating profit of £5.3 million.
It reports total revenue up by 55% to £136.5 million and UK revenue up by 21% to £90.1 million.
As expected, the agency has also announced that it will be withdrawing from the US market following a review launched in May.
The agency says its decision to withdraw from both the US and Australian property markets this year will allow it to ‘significantly reduce cash burn going forward’.
In the year to April 30, the agency completed on over £10 billion of UK property with average revenue per instruction at £1,243, up by 6%.
Purplebricks also claims to have 76% share of the online agency market.
‘another year of strong revenue growth and we continue to build a highly relevant disruptive brand and defensible position in the market’
“It’s been another year of strong revenue growth and we continue to build a highly relevant disruptive brand and defensible position in the market,” says Vic Darvey, Purplebricks chief executive.
“We have taken the difficult decisions to exit our businesses in both Australia and the US as it is very important that we now focus our resources on the UK and Canada, where we have a strong established presence and where there are significant opportunities to grow market share and deliver profitable growth for shareholders.”
“Both exits will be conducted in an orderly manner with the expectation they will be completed by the end of 2019.”
In the outlook section of the results, the agency says it has ‘fundamentally changed the estate agency market’ in the five years since its launch.
The agency adds that it believes its ‘technology-led proposition’ will enable it to take market share from traditional agents.
Purplebricks says it intends to continue investing in its brand, technology and product development, but will ensure greater control over ‘cash management and generation’.
It says that rapid expansion into international markets in recent years has been ‘distracting’ and that this has caused its product and technology teams to be ‘stretched to the limit’.
This time last year the agency’s full-year results revealed UK revenue up 81% and online market share of 74%. The figures also revealed pre-tax losses of £26 million and marketing costs of £42 million.
Last week, the agency published a range of figures compiled by TwentyCi, including claims that Purplebricks is the fastest selling agency brand in the UK and that on average it achieves the second highest price for a property out of the top 10 agents in the UK
Data from the Advisory, published on Monday, shows Purplebricks’ share of the online estate agency sector is now over 70% and that it listed 2,618 new properties over the previous two-week period.
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