Purplebricks has completed the disposal of its Canadian business, which includes the DuProprio and Purplebricks Canada operations (PBDP), to the Desjardins Group, a Canadian cooperative financial group, for cash proceeds of $60.5m Canadian Dollars (approximately £35m).
This figure issubject to minor adjustments for completion working capital and completion debt, and includes repayment of intra-Group debt owed by PBDP to be repaid to Purplebricks immediately following completion.
The announcement to the Stock Exchange yesterday afternoon said that the disposal of PBDP simplifies the Group’s operations and fits with its strategy of focusing on its core market in the UK, where there is substantial opportunity to grow its market-leading hybrid model.
The sale comes just over a year since the closure of both its failed Australian and US operations.
Following receipt of the proceeds of the Canadian sale, the Group will hold a net cash balance of £66m which will be used to further strengthen the Group’s financial position and invest in its UK business.
Purplebricks will grant PBDP a licence to continue to use the Purplebricks brand in Canada for a transitional period until December 2021.
PBDP had an adjusted operating loss of £(2.8)m for the 10 months ended 30 April 2019 and the book value of its gross assets as at 31 October 2019 was £11.4m.
Vic Darvey, Chief Executive Officer commented:
“Over the last 14 months, Purplebricks has reset its strategy to give the Company a strong foundation for the next phase of its growth.
“The Company’s hybrid, digitally enabled model is more relevant than ever and this simplification of the business will allow management to focus its time and the Company’s resources on delivering growth in the core UK market.
“The Board wishes the teams at DuProprio and Purplebricks Canada the very best in their new venture – and I would like to thank them personally for the collaboration and mutual sharing of knowledge and expertise over the last couple of years.”
Comments (23)
What they have done is change the landscape of estate agency.
There are far more ‘Partner Agents’ and people going solo, with orc without the backing of the likes of EXP/KW etc (irrespective what you think of those companies). And the number is growing.
I didn’t think they would ever last as long as they have and that £66m isn’t going to last long either, but as **** as they are, you can’t say they haven’t had a hand in changing UK estate agency.
Decent amount of cash to have in the bank Id say.
Still cr@p at selling property.
Still NOT estate agents.
A brand with no substance.
Next!
I forget,is it 8 or 9 years without making a profit?, honestly what is the point of this business other than burning through other peoples money.
PB V2 ?
I’ll hold my breath till they turn a real, tangible profit for their misguided shareholders.
S0d it, silly idea.
DEAR SHAREHOLDER
LET ME EXPLAIN WHERE IT ALL WENT WRONG THIS TIME……
No doubt a good move for them.
Traditional agents will always hate them for dragging down the public’s perception of what you should pay an Estate Agent; and for their horrendous post sale support.
PB have proved that the public will pay an agent without an office; paving the way for capable agents to break free and work from home, or serviced offices.
This next ten years will see the rise of the local UK realtor – better service – a more personal approach, dealing with fewer sales at better fee levels than the DIY onliners have been charging.
Lets face it Bricks are now liquid to the tune of £66m a position their peer group can only dream of who are dancing to the music of the banks.
Cash is king .Opportunity knocks .
Shame they don’t have some decent management to spend it wisely
All things considered with the world frozen an excellent deal as Canada became an outlier with the shutting down of USA Just think of the hundreds of millions CWD have written off on their purchases
Yesterday saw fresh instructions back in Blighty at Bricks the highest for sometime and July 20 looks like coming back up to July 19 levels .
What next ?
Maybe Axel adding OTMP to its stable now they have built up agents inventory moving Bricks in as a fresh customer for a major traffic boost
Hold on, they had reserves of 100 million last year, and 160 million the year before.
They are burning cash.
A £60m burn per annum it would seem according to those figures, Mr Sharpham.
So – this time next year the cupboard will be var nigh bare… and no silver left to sell.
One phrase springs to mind…
“Oh.
Dear.”
Sure -they have burned a lot of cash but as of today they have £66m in the Tommy whereas CWD are in hock to the banks to the tune of £95m
But if listings were to stop overnight, CWD have tomorrow’s sales to bring in the money to hopefully keep them trading.
PB have already banked all the cash they are getting out of every listing on their books – so what would keep them going, Hillofwad71?
And as Mr Sharpham points out, the historic income has apparently not resulted in a growing bank balance – quite the reverse.
About -£1k per listing, it would seem…
As you know no great fan of Bricks but what was clear from yesterday’s RNS they still had £30m after making a further investment into Homeday which does indicate they have been self -propelling in the UK recently
Free of the claims, shoutiness and ego of it’s early years, contracted back to a firm and solid UK base with lessons learned there is very good chance Mr. Darvey can deliver what he is setting out to
Following the Ewemove lead of being estate agents rather than disruptors, with respected, genuinely local agents who are known trusted and liked in an area Purplebricks B could become an accepted and acceptable competitor.
Very true and well made point. PB v2 will be a success if the right quality is brought in now the old guard has moved on.
With that pay day yesterday things could rocket.
Steady on a bit, you/they are up against the new Paul Smith offering so it won’t be case of here we go, here we go for the LPE’s who are LPE’s in name only. Any hub agent has to be as good, if not better than the average 6 local names they are competing with, in each of 3500 activity centres.
I called it right very early on for one agent with Ewemove but emulating that success is hard work. this isn’t a ticket to easy riches…. or profit
Bought a pup, sold a pup.
That 35mil is a bandaid for the next six months.
Not to worry though, there’s substantial opportunity to grow it’s market-leading hybrid model.
Chortle.
If our industry had a decent lobbying group bricks couldn’t trade.
If they just showed the treasury how many billions in lost fee tax , bricks had cost the industry.
The adverts would stop and bricks would be dead.
We don’t need government intervention to beat the bricks.
im fine with a free market, customers are wise enough to realise they need a good agent.
I would never want to control my customers or force my competitors to close, because I’m not scared of them.
“im fine with a free market, customers are wise enough to realise they need a good agent.”
Tell that to the 00000s that pay Purplebricks to sell their homes but don’t get their expected sale, undercover agent.
Wise after the event doesn’t count – but it is an expensive lesson to gain that wiseness.
you could apply that logic to anything, let’s ban: fried food, unsuccessful football teams and bad fashion choices. after all: “Wise after the event doesn’t count.” We should save people from themselves. people are too stupid to choose for themselves. we must protect them.
Maybe your views are popular, and maybe they’re also innocent, with the best interests of the customer at heart, but I choose the free market every time. I trust customers to decide how they spend their own money. I wonder about some of the choices they make (why were shell-suits ever a thing), but free to choose, means free to make mistakes. Hell, you can even grow a handlebar moustache if you want. it’s your life.
if customers aren’t choosing you, it’s not because your customers are “wrong” and need controlling, by legislating against them. it’s because you failed to convince them. Maybe you’re not persuasive enough for this industry. maybe you should be banned? I don’t think so, I’m happy customers are free to choose you (but should not be FORCED to choose you).
just look at history, “protection” for “approved” companies, in the name of “protection for the customer,” is one of the stupidest ideas humans have had. It sounds wise, but it forgets, that the only thing really protecting the customer, is the customer’s freedom to choose. we diminish that at our peril.
“it’s because you failed to convince them. Maybe you’re not persuasive enough for this industry.”
What nonsense. How many people choose their Agent without fully researching the market? Without getting three… four… or even nine Agents out in a ‘beauty parade’?
Of those that don’t – the vast majority I would suggest – why do they choose the ones they do invite to pitch?
If they are then all equally “persuasive” – who does the homeowner choose to market their home?
Why – or how – do those “not persuasive enough” Agents get any properties at all to sell?
Why do they even bother to try if they know their ‘persuasiveness’ failings?
Do you have a 100% appointment to listings ratio? If not – why not? If you weren’t persuasive enough, why bother trying for the next one? Why do you think your persuasiveness can be turned up next time?
What about the ones that come to market that you didn’t get to pitch for – where was your persuasiveness then?
I wholeheartedly agree that you can’t ‘protect the public’ – if they want to walk out in front of a bus or wazz a grand up against the wall on a failed portal advertising exercise that’s their perogative. But they have the facts on road deaths to know the potential consequences of walking in front of a bus and therefore are able to make an informed decision as to whether it’s a good or bad idea.
So shouldn’t homeowners have the facts available to make an informed decision – something that is patently absent now – on choosing an Estate Agent, giving those that potentially need more help with their choice than others, that are open to the likes of a TV advert… or glowing reviews by the troughful… to persuade them to part with their money?
Or – if giving them the facts is too much of a perceived control, how’s about simply cutting the showboating… the misleading… the ‘alternative truths’… that are the issue?
Nothing whatsoever wrong with ‘let the best (insert appropriate/most PC title here) win – I’m all for that. But let that best xxxxx win the business fairly and squarely.
Surely an attempt to avoid the ‘wise after the event’ situation isn’t such a bad thing – especially in the free market you are so fond of, undercover agent?
I’m all in favour of “informed consent” I like EPCs but I don’t like properties with an F being un-rent-able, we’re all grownups.
Bricks are an online only agent. Customers know that. What’s the plan, force agents to disclose the % of property they actually sell? It’s not a bad idea, but I fear Bricks would game the system anyway.
“What’s the plan, force agents to disclose the % of property they actually sell? It’s not a bad idea, but I fear Bricks would game the system anyway.”
You been out of the country for a while, undercover agent? Or comatose? Suffer from amnesia?
The company do disclose the % of property they “sell”. Quite often. And very publicly. On radio consumer programmes… BBC Watchdog… all the best places. Oh – and in their City statements. The numbers started with 88 percent “sold” within 10 months (credit: Michael Bruce) – but the inferred claim was that they ALL went on to sell eventually. So – 100% then. Most recently it was somewhere around 77% – and the language has softened somewhat to “…listings sold (completed, exchanged or SSTC) within 12 months…”
And are those figures correct? Maybe.
Maybe… IF you count every SSTC – and maybe omit to subtract those that fall through… …maybe then you’re close to that figure.
PB have huffed and puffed at the Jefferies “Toss of a coin” report since it was published – but have never disproved it.
And the reported percentages have fallen since.
Hey – maybe it’s time for an updated report.