Countrywide to take Brexit hit as losses widen
The firm is behind the Bairstow Eves and Hamptons brands.
Struggling estate agency Countrywide has warned that Brexit will knock its performance over the coming months as the firm posted widening full-year losses.
The group – which is behind the Bairstow Eves and Hamptons brands – reported a bottom line loss of £218.2 million in 2018 compared to £207.3 million of losses the prior year.
Income for the year also tumbled 7% to £627.1 million and adjusted earnings came in 50% down at £32.7 million.
We encountered market weakness in quarter four due to the further uncertainties surrounding Brexit Countrywide's Peter Long
Countrywide warned that Brexit is leading to a slow-down in residential and commercial property transactions, particularly in London and the South, which will impact first-half earnings by up to £5 million.
While it expects full-year earnings to be in line with 2018, that will be dependent on recovering the first-half shortfall in the final six months of the year.
Boss Peter Long said: “We encountered market weakness in quarter four due to the further uncertainties surrounding Brexit which is affecting both our sector and consumer confidence as a whole. These headwinds have continued into 2019.
“As a result, we are experiencing further slow-down in residential and commercial property transactions particularly in London and the South, which will affect our half one earnings by some £3-£5 million.”
On a statutory basis, pre-tax losses came in at £252.7 million as the firm was hit by £245.4 million of charges linked to goodwill, intangible and other asset impairments.
Countrywide endured a tough 2018 that saw it tap shareholders as part of an emergency £140 million fundraising plan to put it on a more secure financial footing.
But Mr Long added: “We have been encouraged by the progress made in 2018 in resetting the business as part of our return to growth strategy.
“The principles within ‘back to basics’ in sales and lettings resulted in growth in the register and the sales pipeline in the UK, coupled with an increase in market share of listings.”
Earlier this week, the group was slapped with a £215,000 HMRC fine for money laundering failures.
HMRC said it failed to ensure that its anti money laundering procedures were in line with regulations.