LSL Property Services has reported record underlying operating profits driven by strong performance across its core businesses.
The Newcastle-based firm - which includes the Reeds Rains and Your Move brands - said underlying operating profits increased to £49.3m, up 40% from £35.2m in 2021, on group revenue of £326.8m, up from £266.7m.
Investors were told LSL’s focus on financial services will help it face a more challenging housing market in months to come as it pointed to estimates that suggest the mortgage market will be about 11% lower than in 2021 and housing transactions about 19% lower.
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Underlying operating profit for the financial services division increased 34% to £14.4m and while it increased 46% to £23.6m for the surveying and valuation division.
The estate agency division increased underlying operating profit by 53% to £18.4m - and LSL reported its share of the entire UK purchase and remortgage market was now almost 10%.
David Stewart, group chief executive, said: “I am pleased to report that LSL’s core businesses are performing well and that our Financial Services led growth strategy has made good progress.
“We expect mortgage and housing transactions to revert to pre-COVID levels with geopolitical uncertainties adding to existing inflationary pressures. These will affect our estate division in particular, and as always, we will be agile and respond to market conditions as required.
“However, the benefits of both our growth strategy in financial services and the significant progress made in surveying and valuation, mean that we expect the housing market cycle to have a more limited impact on the group’s results.
“We look forward to reporting further growth in financial services, alongside continued investment in building our D2C businesses and I remain excited about the group’s longer-term opportunities.”
LSL said a combination of disposals and cash generation had resulted in a record net cash balance of £48.5m at the year end, leaving it well placed to invest in technology and acquisitions.
It is proposing a final dividend of 7.4p per share, giving a total dividend for the year of 11.4p per share.
