Purplebricks investing for further growth

Headline losses reflected the decision to invest more in expanding the business, notably in the US, where it will begin trading in San Diego, Sacramento and Fresno in January 2018.

In the UK, revenue jumped by 118 per cent, and cash profit rose from £0.3m to £4.7m. A total of £4.6bn of property was sold and completed, with a further £3.8bn in the pipeline. Further investment saw local property expert numbers more than double to 650 from a year earlier, while local letting expert numbers were up to 58. Purplebricks has increased its share of the online market to 74 per cent.

The Australian operation has just passed its first anniversary since launching and raised £6.8m of instruction fees, having sold or completed A$1.1bn (£662m) of property. Brand awareness reached 10 per cent, a level that took two years to achieve in the UK.

The attractions of the $70bn (£52.5bn) US market include the fact that average commission on house transactions is between 5 and 6 per cent, a level that Purplebricks can substantially undercut with its fixed price model. The US launch went to plan and within the expected budget, and although it is still early days there has been a positive response to its advertising campaign, with increased website visits, valuations, listings and sales.

Purplebricks continues to focus on improving the customer offering through the use of more technology. The app for buyers and sellers has been upgraded, and users now have access to a range of services from booking valuations through to agreeing sales.

Analysts at Peel Hunt are forecasting an adjusted pre-tax loss for the year to April 2018 of £23m and a loss per share of 9.2p (from osses of £6.1m and 1.2p in FY2017).