The UK’s largest estate chain, Countrywide, this morning announced record results for last year, with huge increases in income and profits.
Total income for last year was £702.2m, up 20% from 2013. Operating profits were 52% up at £84.9m and profits before taxation up 63% to £102.4m. Earnings before interest, tax, depreciation, etc (EBITDA) rose to £121.1m, up 40% from the year before.
The estate agency division saw a 9% increase in income to £210m with more homes sold and “a modest increase” in fees. However, its separate London and Premier division saw EBITDA drop from 21% to 20% as revenues declined.
In 2014, the group sold a total of 72,405 homes, up from 65,809 the year before, and arranged 70,529 mortgages, against 60,640.
It also had 65,334 lettings properties under management, an increase of 25% from the year before, with lettings and management revenues up by 6%. Alison Platt, chief executive, said Countrywide plans to continue growing its lettings business.
The group also completed more valuations, surveys and conveyances and continued its growth.
It bought 38 businesses at a cost of £48.9m and invested £13.3m of seed capital in a residential property fund aimed at the private rented sector.
The group’s investment in Zoopla reaped rewards for shareholders when Zoopla floated last June. A partial disposal of Countrywide’s shares in Zoopla resulted in a windfall of £20m.
The only dark cloud reported today was on the number of ongoing claims against Countrywide’s surveying and valuation business, relating to surveys carried out between 2004 and 2007 – before the housing market crashed. A charge of £15.2m has been put into the accounts to allow for claims. Despite the six-year primary statutory limitation period coming to an end, Countrywide said “it is disappointing that high levels of claims continue to be an issue across the industry”.
An “unexpected” level of claims were being brought under common law, said Grenville Turner, Countrywide’s chairman.
He also said that last year had been a year of two halves – strong in the first half, but weaker in the second. He warned of “sluggishness” expected in the first part of the current year.
He said: “The group has delivered a record set of results for 2014, its first full year of trading since IPO, which show strong growth in both income and profits, underpinned by robust recurring revenues.
“We anticipate some sluggishness in market trends over the first half of 2015 in the lead-up to the election.
“However, the resilience we derive from our broad-based business, our low leverage and our proven ability to deliver growth in a challenging market, positions us well to take advantage of sustainable growth in our lettings and commercial businesses and capitalise quickly on the upturn as the residential sales market recovers in the medium to long term.”
Platt said: “Of particular note is the significant progress we have made diversifying our revenue streams into more property activities that are independent of the housing transaction cycle, and this trend remains a key tenet of our vision for how the business will continue to grow.
“Countrywide is already a highly integrated player, but there is a clear opportunity to expand further by fully leveraging the expertise and customer base of our substantial network of regional offices to offer our customers multiple services.
“We will also continue to grow our lettings business, both through property management and by increasing our investment in the private rented sector.
“I believe that these activities, together with the escalation of our commercial real estate activities, where there are also many opportunities to grow recurring revenue streams, position us well to achieve our aim of building a broad-based business that can perform well and deliver robust shareholder returns throughout the market cycle.”
Comments (23)
Okay… now even I’m lost.
Am I seeing irony, sarcasm, ironasm, sarcony or plain unadulterated f#ckwittery (credit: Jonnie) in these posts?
I’m going for a lie down…
I thought you might have been going to do the laundry with all that ironing going on in your comment PeeBee.
When you get Jonnies, penetration and generation in a sentence Peebee it is innuendo. I am not sure admitting going for a lie down is such a good idea.
Well that made me laugh. And it got comment of the week.
WAY TO GO!!!, Jonnie!
I reckon you owe a lot of people (…with senses of humour…) new keyboards.
Oh – and a few LED screens to those that haven’t… ;o)
I cant believe that people on here are seeing a funny side to Jonnies comments. Online agency is a serious matter. Their market share has grown since they started about 10 years ago and they say they offer the same service as high street agencies for as low as £69. Shouldn’t we be worried instead of laughing about it Jonnie???
It is serious Wilko, as in fact is comment of the week. I think I came in with a couple of candidates but clearly I fell short. I will try and remain sportman like about it, but I can tell you I’m dying inside.
Good, glad to see it made comment of the week, Jonnies first I believe. In all seriousness though the online proposition is growing. 2% penetration in 10 years…By my calculations, and at that rate they will be up to 5% in 2030 when I retire……I fear for the next generation…..I really do.
Wilko,
Remember years back when you could only work out market share by doing board counts? I do and I remember the 2 or 3 private boards each time, we calculate our market share on right move now and there are 2 or 3 budget agent instructions instead, 10 years on have they made big in roads or just got the old guard FSBO on the portals? – Jonnie
For me the main point is that should in 2030 online only be the system the customer chooses then: I can lay off a number of sales guys, fill one of my offices with cheaper telephone operators. run my business as a cheap online one and you know what I would still beat them because I am local and really know my market. The only thing that will change is the fees charged and none of these firms are annoucing profits of any kind! So actually when I and then thousands of local agents across the country do the same thing, they have no business.
As a sales manager within the Countrywide Group, good to see the business growing. Been with them for a few months now and there is a great focus on customer service rather than just being ‘corporate’. Some get it right, others perhaps not so much but that can be said within the independents too.
About the point of buying in the business on lettings, like listings, the greater the market share, the greater the business and up sells in the future.
JAM01 – Countrywide and customer service do not go hand in hand!
How are CCS? Got your quota this month? How many sales they lost you?
How many first appointments have you had to force to sit with the poor mortgage adviser getting hammered on their conversion ratio because people are forced to sit with him?
Sold any upfront packages this month? That probably not had their brochers turn up.
All your sales memos go out or did central admin **** them up?
Enjoy the open house weekend? – lots of business…
How is your office fully staffed or you having to work 6 days as recruitment so poor?
How is your team and teams around you lots of experience or all a lot of youngsters who have been promised a dream and have no idea what they are doing?
They still doing the happy clappy once a week rah rah on customer service or that now forgotten about?
Enjoy it while the novelty lasts, believe me you will see in the end how little focus countrywide have on customers.
Countrywide have a model to follow for the lowest possible performing neg, and they treat all that way. This is why their better staff move on. its not just about what you stack in its about money banked.
How is Bob, still not a clue about agency but still visiting offices and giving ‘invaluable advice?’
Smile Please…mmmm….very interesting….OK, let’s have a go at answering these then:
1. How are CCS? Got your quota this month? How many sales they lost you? So far, no sales fall throughs using CCS. (and yes I am selling lol!)
2. How many first appointments have you had to force to sit with the poor mortgage adviser getting hammered on their conversion ratio because people are forced to sit with him? Averaging about 15 pcm for 1sts – especially good at getting buyers in BEFORE viewing so I know they can afford to buy, add them to the Hot Buyers list as a fully qualified applicant, putting them in a great position to have their offers recommended to the vendors and the FS guy loves the sign ups he is getting, making him a regional leader for income banked (not just me of course – the others in the office fully chip in too!).
Sold any upfront packages this month? That probably not had their brochers turn up. The professional photography and audio tours, including RM and Zoopla Premium listings, enhanced floor plans and brochures are doing well, at £199 plus VAT. Oh, and they get £200 cash back on completion of sale – so vendors ‘buying in’ shows who are motivated to sell as opposed to tyre kickers who take their properties off the market when they receive the offers they didnt think they would get, the only person having spent money on marketing being the poor estate agent, who then counts the cost.
All your sales memos go out or did central admin **** them up? Great that there is central admin that does the work based on a ‘click’ on the task button – as with viewings and vendor feedback, a quick call to the named admin rep ensures all is as it should be – it’s good to talk you know! 🙂
Enjoy the open house weekend? – lots of business… Yes, great – we had an Open House by appointment only on one property in Charing, Kent, by way of example. The professional photography from the pre-paid vendor Enhanced Marketing Package ensured it was well attended, with double figure ‘by appointment’ only viewings over a 2 hour period, that resulted in a mid-price range sale above the level the vendor was quoted from other agents, and it meant we have 12 viewings in 2 hours and sale agreed, rather than driving to the property 12 x times over a period of 7 – 10 days. Seems to make sense to me on a popular property – and the buzz ensures high value offers are placed.
How is your office fully staffed or you having to work 6 days as recruitment so poor? We are actually going to start manning the office on a Sunday, by request from the members of staff, as we are so busy. No staff turnaround in our office since I joined – indeed other local agents are now (genuinely) getting in touch to ask to join our branch, such has been the turnaround in our performance in the local market…all because of performance and customer service.
How is your team and teams around you lots of experience or all a lot of youngsters who have been promised a dream and have no idea what they are doing? Our Branch Manager is highly experienced. As sales Manager, I had my own biz for 8 years (Sales and lettings), so am highly experienced and the senior neg has also just been promoted to sales manager position, such is his performance over a 4 year period….in the same office.
They still doing the happy clappy once a week rah rah on customer service or that now forgotten about? No….focus on activity days is MAs.
Enjoy it while the novelty lasts, believe me you will see in the end how little focus countrywide have on customers. Sorry…not the case anymore…if it was true in the past (perhaps it was), the culture has changed and is working its way down from the top to the branches. Like an oil tanker, it can take time for the direction to change when the hand is on the tiller but it is changing direction.
Countrywide have a model to follow for the lowest possible performing neg, and they treat all that way. This is why their better staff move on. its not just about what you stack in its about money banked. Nope – the focus is on the high performers, the stars of the week, the stars of the month and when others see the league tables each week and month and how the top performers are being rewarded, including with trips abroad, the culture is now one of outstanding achievement that gets rewarded.
How is Bob, still not a clue about agency but still visiting offices and giving ‘invaluable advice?’ Came to our office last month – nice guy and a good leader. Like many CEOs, they don’t need to know the nuts and bolts to be good leaders – they need to know how to be good leaders.
Hope that answers some of the Qs and thanks for taking the time to post. I thought I would try and do your efforts justice – always another side of every story and as long as it ends in ££££ss in the bank …………
Oh, dear… it seems that today is ‘I can’t spot a wind-up even if it kicks my crotchicles’ Day.
Come on, you lot – especially YOU, Yorkshire Agent – you’ve ‘known’ Jonnie and his wickedly ironic sense of humour for years – he’s so ‘High Street’ if you cut him in half it would be written inside him like a stick of rock!
Read him again… you will actually hear your own pennies drop.
Well said Jonnie its all going on line, the High Street and shops will die, the only growth industry will be tumbleweed growers…or so you think. A new HMV has just opened here and looking at Aldi and Lidl who don’t do online shopping, look how they are smashing those who do by a clever pile them high come in and shop in a real place cheaply! Even Tesco and Sainsbury’s acknowledge a place for the corner shop in town centre’s. Estate agents will fight back with lower margins/fees, some will vote with their feet and use an online agent and the market will polarise and the big backers of online businesses will want return on capital, so will move onto the next fad if it isn’t as profitable as they would like. Do you remember property shops, agents absorbed the idea and now we have behemoths like Countrywide that do it by association if not necessarily offering all services in each shop.
You are all wrong, ITS ALL GOIN’ ONLINE INNIT! You watch the Countrywide profits collapse in the next 5 years and Foxtons have to close those big fancy offices, the customer wants to do it all online, look at how they buy music now! – Jonnie
Whats the material difference between your £2.99 ABBA download jonnie and the largest most important financial transaction of your life?
25% increase in properties under management, yet only 6% increase in management revenue. Buying in the business or what!
Jonnie your comments read as if High Street agents are not online, can you name me one who is not?
Should we choose to close our high street offices, I would still wish to offer the high level of personal service and skilled negotiators that I have today and continue with accompanied viewings. Yes we would not have to pay high street rents, however I would have to place my staff somewhere else. The major cost in our business is wages. Customers and clients want to deal with agents directly in person, this may be face to face, on the phone or by email. Don’t forget there is as much work after finding and qualifying a buyer, chasing solicitors, checking chains, keeping clients up to date with events, and numerous accompanied after sale visits. If the sale falls through, chasing up buyers whose interest you have recorded. Good agents pay for themselves time and time again with good negotiation skills backed with local knowledge.
A good agent needs to tailor his service to the client as well as to the property, to obtain maximum interest. Therefore the Internet is important but by far not the only selling tool in the tool box. The online agent will be unable to cater for, as example the elderly purchaser I met yesterday who has given her computer away.
I’d have your sarcasm detector looked at, seems like it’s not working.
Hi Jonnie
I assume your an online agent or a fan of them . The Inconvienant truth is that it’s not going online as you hope.
in the 1840s gold rush, the people that made all the money where the traders selling pans and shovels. In the web based estate estates agency world it will be the portals not those that think they can make money with low fees in a serious competitive industry.
Take me a look at those figures. Well done countrywide. Hate them as I do you gotta respect that.
re think your business plan Joanne. business is about earning money.
Yesterday Foxtons opening more branches and Connells reporting huge profits, now Countrywide with best profits ever?? – Don’t these people see that it’s all goin online, it can’t be right that so much money is being earned by estate agents when the Internet gives the customer everything they need!! – Jonnie
Seems we’re having an irony bypass on here today!