Since floating on Aim in December 2015, Purplebricks (PURP) has come a long way: from £240m at the placing, the market capitalisation is now well past £1bn. UK revenue in the reported year increased by 151 per cent (see table) and is expected to be nearly double that in the year to April 2018.
The company reported its first full-year operating profit of £0.2m. Expanding the online hybrid business model has soaked up a lot of funds, with marketing costs alone up from £12.9m in the previous financial year to £18.2m. But the benefits are already showing. Purplebricks increased its share of the online market from 62 per cent to 72 per cent, while website visits rose to 2.5m a month. And there is still £71m in cash to fund further expansion.
Purplebricks has also started a business in Australia, where progress has been even more encouraging than in the UK at the same stage. Adjusted cash losses amounted to £5.4m, but revenue in the current financial year is expected to reach £12m. There are also plans to launch into the US market, and a net £48.8m was raised through a placing in February to finance this. The outlook is promising considering that estate agents there charge commission of around 6 per cent.
Analysts at Peel Hunt are forecasting adjusted pre-tax losses for the year to April 2018 of £23m and a loss per share of 9.2p (from £6.1m and 1.2p in FY2017).
| PURPLEBRICKS (PURP) | ||||
|---|---|---|---|---|
| ORD PRICE: | 417p | MARKET VALUE: | £1.13bn | |
| TOUCH: | 415-417p | 12-MONTH HIGH: | 460p | LOW: 100p |
| DIVIDEND YIELD: | nil | PE RATIO: | na | |
| NET ASSET VALUE: | 28p | NET CASH: | £71m | |
| Year to 31 Mar | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2015 | 3.39 | -5.4 | -357.0 | nil |
| 2016 | 18.6 | -11.9 | -12.0 | nil |
| 2017 | 46.7 | -6.1 | -1.0 | nil |
| % change | +151 | - | - | - |
Ex-div:- Payment:- | ||||
