The real estate franchise group on Tuesday announced strong results after a year of organic growth fueled by acquisitions.
The online/hybrid estate agency revealed a 33% rise in pre-tax profits, driven by a 23% rise in revenue to £10.2m.
The Real Estate Franchise Group recently changed its name from MartinCo to reflect the company’s transformation from a single brand franchise to a multi-channel group leveraging technological advances in the real estate brokerage business.
An important acquisition for the Group was EweMove, which not only added 120 offices, but also provided digital technology that strengthened the entire Group with a strong digital outlet, something previously lacking in some traditional brands. Ta.
EweMove is powered by technology that reduces the cost of generating new revenue for all brands. Whitegates, one of the group’s brands focused on the Midlands and North of England, has seen a 649% increase in conversions across its website, helping Property Franchise Group compete with digitally-driven competitors. It highlights the efforts of
Source: Real Estate Franchise Group
UK Investor Magazine interviewed CEO Ian Wilson. He was optimistic about the group’s ability to grow in a transforming industry, not only through advances in technology but also through a business model that supports the group’s franchisees.
The company counts brands such as Martin&Co, Ellis&Co, Parkers and CJ Coles as franchisees and has increased its office count by 7% in the past year.
Mr Wilson also mentioned plans for further growth through the acquisition of smaller agencies by franchisees, with support from the parent company in the form of a cashback scheme to support cash flow during the process.
On the cash front, the group’s cash position was supplemented by an almost double increase in cash from operations, increasing cash in the bank to £2.6m.
The company’s strong cash position has given the board the confidence to increase the dividend to an annual dividend of 7.5p, with the current share price yield of approximately 5.5%.
Despite strong earnings growth and dividend increases, there are reasons to be cautious.
While there are potential risks to the outlook for the UK housing market and changes in rental prices, the fundamentals are resilient and the majority of our revenue comes from ongoing management fees, so we are in line with other rental companies. Groups are likely to be similarly hit by the advance payment ban. Even after fees, it does not pose a significant threat to continued growth.
