Belvoir Lettings profit and revenue rise despite 'challenging conditions'

AIM-listed property franchise Belvoir Lettings reported a sharp rise in profits on Tuesday and said it was on track to meet management expectations for the year.

In the year to the end of June, pre-tax profit surged 62% to £1.7m as revenue increased 15% to £4.9m. Management service fees (MSF) - from which Belvoir derives the core of its revenue - were up 47% to £3.8m, reflecting organic growth, franchisee-led acquisitions and a full six-month period contribution from its Northwood acquisition in June last year.

The rise in profit and revenue came despite "challenging conditions" in both the sales and the lettings markets. Belvoir said a shortage of housing stock available for sale has reduced activity in the sales market and the changes to the tax regime and stamp duty for buy to let landlords and the impending ban on tenant fees has caused some uncertainty in the lettings market.

Chief executive officer Dorian Gonsalves said: "In H1 the group achieved organic growth from MSF, our key revenue stream, of 4% which is higher than the reported rental index within the sector, and continued growth from property sales, in a market that has seen some mixed results from other companies in the sector.

"Our ability to outperform the market has helped to deliver a strong set of first half results, and with a promising start to the second half, Belvoir is on track to meet management expectations for the year."

At 1000 BST, the shares were up 4.3% to 108.50p.