It's shaping up to be another game of two halves for real estate group LSL Property Services (LSL). First-half figures were skewed by the partial sale of the group's stake in online property company Zoopla last year, which brought with it a one-off £18m gain. That explains much of this year's sharp drop in pre-tax profits. An extra £2m in contingent acquisition costs didn’t help the bottom line either.
Chief executive Ian Crabb says trading should be easier in the second half, and the group is still on track to meet full-year market forecasts. For one, LSL is up against far easier comparatives thanks to a slower second half last year, and underlying trading is still strong. Revenues for lettings and financial services rose 11 per cent and 14 per cent respectively in the first half, despite a 6 per cent drop in housing transaction volumes as political uncertainty dragged on the market.
The surveying division grew operating profits by a third following several contract renewals and increased revenue per job. The group is still hot on the acquisition trail too; LSL has spent nearly £4m investing in 13 businesses so far this year.
Analysts at Numis expect pre-tax profits of £42.5m this year, giving EPS of 32.6p, up from £40.1m and 30.5p in 2014.
| LSL PROPERTY SERVICES (LSL) | ||||
|---|---|---|---|---|
| ORD PRICE: | 361p | MARKET VALUE: | £376m | |
| TOUCH: | 360-365p | 12-MONTH HIGH: | 409p | LOW: 264p |
| DIVIDEND YIELD: | 3.4%* | PE RATIO: | 72 | |
| NET ASSET VALUE: | 84p** | NET DEBT: | 60% | |
| Half-year to 30 June | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2014 | 139.8 | 31.4 | 24.2 | 4.0 |
| 2015 | 140.2 | 6.2 | 4.7 | 4.0 |
| % change | +0 | -80 | -81 | - |
Ex-div:12 Aug Payment:08 Sep *Excludes 16.5p special dividend in 2014 **Includes intangible assets of £160m or 153p a share | ||||
