Property services group Countrywide (CWD) was another casualty of the moribund state of housing transactions. And while its share of the sales market was only slightly down from 5.1 per cent to 4.9 per cent, the sales market itself slid by 7 per cent in terms of transactions. And with the half-year dividend cut altogether, the shares fell as much as a tenth on the day of the results.
As with other estate agents, a 29 per cent collapse in adjusted cash profit on the sales side was propped up by a modest 2 per cent decline in letting income. Activity in the previous first half was boosted by a rush to beat the introduction of higher stamp duty, but since then political and economic uncertainty have driven many potential sellers to sit on their hands. And Countrywide doesn’t expect any improvement yet.
On the plus side, revenue held up well in broking and other financial services following the launch of a telephony mortgage channel, while the B2B surveying service benefited from a new technology platform. Net debt fell from £248m at the December 2017 year-end to £217m, thanks to stronger cash flow and a £37.8m share placing in March. Action has also been taken to reduce costs by thinning out management layers, and total costs were down £27m year on year. Further cost reductions are in place to help mitigate the effects of a ban of letting fees that is expected to come into force next year.
| COUNTRYWIDE (CWD) | ||||
| ORD PRICE: | 147p | MARKET VALUE: | £350m | |
| TOUCH: | 146.5-147.25p | 12-MONTH HIGH: | 290p | LOW: 145p |
| DIVIDEND YIELD: | nil | PE RATIO: | na | |
| NET ASSET VALUE: | 218p* | NET DEBT: | 42% | |
| Half-year to 30 Jun | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
| 2016 | 360 | 24.3 | 9.77 | 5 |
| 2017 | 327 | 0.45 | -0.12 | nil |
| % change | -9 | -98 | - | - |
| Ex-div: | - | |||
| Payment: | - | |||
| *Includes intangible assets of £717m, or 301p a share | ||||
