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Belvoir Group PLC (BLV)

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Thursday 02 December, 2021

Belvoir Group PLC

Trading Update

RNS Number : 2972U
Belvoir Group PLC
02 December 2021
 

This announcement contains inside information.  

 

2 December 2021

 

BELVOIR!
 


BELVOIR GROUP PLC

(the "Company" or "Belvoir" or "Group")

 

Trading Update

 

Performance Ahead of Expectations

 

 

Belvoir Group PLC (AIM: BLV), a leading UK property franchise and financial services Group, is pleased to provide the following Trading Update for the year to 31 December 2021.

 

The Board is delighted to report that trading in the ten months to the end of October 2021 was ahead of management's expectations, with both of the Group's divisions, property and financial services, achieving year-on-year growth. 

 

The property division, which contributed 77% of the Group's gross profit, achieved gross profit growth of 29%.  Income from lettings was 21% up on 2020 resulting from unprecedented demand for rental properties with rents increasing in all areas of the UK, as well as the acquisition of Nicholas Humphreys, a predominantly student lettings network.  Meanwhile, income from sales was up 65%, mainly a result of the strongest market for property transactions seen since 2007. 

 

The financial services division, which contributed 18% of the Group's gross profit, continued its strong growth with gross profit up by 39%.  Belvoir's network of mortgage advisers increased by 21% from 202 at the start of the year to 245 by the end of October. This represented a net increase of 43, which arose through organic recruitment and 21 from the acquisition of Nottingham Mortgage Services, the mortgage arm of The Nottingham Building Society. The Group remained focused on meeting the demand for house purchase mortgages for much of 2021, and now, given signs that interest rates might rise, are benefitting from a busy period for remortgages.  The ability of our advisers to switch between different product sales and our substantial client base provide a very resilient and agile business model for our financial services division.

 

The Group's operating activities continue to be highly cash generative underpinned by Belvoir's significant recurring lettings income stream.  As of today, net debt is down to £2.7m (31 December 2020: £3.7m) despite having deployed £4.0m of cash in March to acquire the Nicholas Humphreys network and £0.6m in July to acquire Nottingham Mortgage Services.

 

Outlook

Current substantial pipelines of house sales and written mortgages support our end of year forecasts.  Consequently, the Board expects that the performance for the full year, in terms of profit before tax, will be ahead of management's expectations for 2021 and substantially ahead of 2020.

 

 

Dorian Gonsalves, CEO, commented:

"In 2021 we have seen our franchisees and mortgage advisers take advantage of an exceptionally strong sales market.  The sector undoubtedly benefitted hugely from the Government's decision to extend the stamp duty holiday until September 2021, following which we have seen a predictable slowing in the number of new instructions as the market normalises. We anticipate that given the ongoing pent-up demand from buyers, the market will return to more usual transaction levels in 2022.  In the meantime, our current pipelines remain strong and support outperforming our end of year forecasts.

 

The Board is mindful that 2022 is likely to present further challenges for the wider economy, but we are confident in our business model of supporting entrepreneurial franchisees and mortgage advisers to achieve their business ambitions, and that our growth strategy of organic growth coupled with investment in profitable property franchise and mortgage networks will continue to prove successful and deliver long-term shareholder value."

 

 

For further details:

Belvoir Group PLC

Dorian Gonsalves, Chief Executive Officer

Louise George, Chief Financial Officer

www.belvoirgroup.com

 

 01476 584900

[email protected]

 

finnCap

Julian Blunt & Teddy Whiley (Corporate Finance)

Tim Redfern & Charlotte Sutcliffe (ECM)

www.finncap.com

 

+44 (0) 20 7220 0500

Buchanan

Charles Ryland, Vicky Hayns & Tilly Abraham

 

 +44 (0) 20 7466 5000

     

Notes:

About Belvoir Group PLC

Founded in 1995 and listed on AIM in 2012 (BLV.L), Belvoir operates a nationwide property franchise Group with 467 offices across six brands specialising in residential lettings, property management, residential sales and property-related financial services. With its Central Office in Grantham, Lincolnshire, the Group manages 71,600 properties and reported record revenues of £21.7m in 2020 marking Belvoir's 24th year of unbroken profit growth.

 

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