Foxtons faces slower second half

The impact of this slowdown on revenue should be countered by the financial contribution of newly established branches. Five new Foxtons outlets were opened in the first half, and there are plans to open a further two branches in the second.

Focused on London, Foxtons operates at the top end of the UK housing market. It is noticeably more profitable than most estate agents, with a cash profit margin of 34 per cent in the first half - up from 31 per cent in 2013. That's despite a 10 per cent increase in administration costs, mainly due to an increase in staff numbers, higher building operating expenses and the costs of operating as a listed company. Cash flow remains robust, growing 21 per cent to £14.3m, and the group is debt free.

Commission from sales was up by a third to £37.8m - over half of total revenues - driven by a near 20 per cent increase in sales volumes. Both established Foxtons branches and new openings pulled their weight. Commission earned from mortgage broking also rocketed by nearly a half to £3m, primarily as a result of the higher sales volumes, though average revenue per deal also rose with house values.

The lettings business, which accounts for 44 per cent of total sales, was more subdued, with revenue unchanged from a year earlier. This is unsurprising given the froth in the London sales market: house hunters have been more focused on buying rather than renting.

Analysts at Numis are forecasting full-year pre-tax profits of £51.4m and EPS of 15.1p (from £42.1m and 13.3p in 2013).