Foxtons profits drop amid ‘challenging’ sales market

London estate agent Foxtons posted a decline in full-year pre-tax profits on Tuesday amid "challenging" conditions in the sales market.

In the year to the end of December 2023, pre-tax profit fell 34% to £7.9m, while revenue edged up 5% to £147.1m. Adjusted operating profit ticked up 2% to £14.3m.

Foxtons said growth had been delivered "despite a significantly weaker sales market and headcount investment required to rebuild core capabilities".

Revenue from the lettings segment - which makes up around 70% of total revenue - was up 16% to £101.2m. However, sales revenue fell 14% to £37.2m, as challenging market conditions were partially mitigated by market share driven outperformance of the wider London market, which was down over 24% on value.

Revenue from the financial services division was 14% lower at £8.8m as weaker new purchase mortgage volumes were partially offset by non-cyclical and recurring refinance volumes, Foxtons said.

Chief executive Guy Gittins said: "Our strategy to deliver growth through sales market cycles by delivering Lettings growth is working, delivering resilient earnings for the year despite a weak sales market and the investment we made in fee earners.

"We are on track against our medium-term target of delivering £25m to £30m of adjusted operating profit, through organic and acquisitive growth and supported by improving market conditions."