LONDON (Alliance News) - Belvoir Lettings PLC said it is looking to take advantage of pressure on the private rental sector and property sales market as it reported an increase in profit and revenue for the first half.
The lettings specialists posted pretax profit of GBP773,000 for the six months ended June 30, up from GBP732,000 a year earlier, as revenue rose to GBP3.3 million from GBP2.5 million.
Belvoir, which has had a turbulent six months following the shock departure of its newly-appointed chief executive, said its performance was underpinned by an increase in management service fees of 11% and a growing revenue streaming arising from its estate agency business acquired in 2013 of GBP417,000 compared with GBP143,000 a year earlier.
In March, Carl Chadwick, who was previously finance director, took over from Dorian Gonsalves. Gonsalves, who had overseen the company's shift towards providing an estate-agency service, became the company's commercial and franchising director. However, less than three months later the company announced that Chadwick had decided to step down from the role to focus on other business interests.
Chairman Mike Goddard took on the additional role of CEO, and Belvoir later appointed Louise George as finance director. George joined from AIM-listed Image Scan Holdings PLC.
Despite the turmoil, Lincolnshire-based Belvoir on Wednesday said it was successful in converting a number of corporate-owned outlets into franchise operations. This resulted in a reduction of revenue from corporate-owned outlets of 11% to GBP614,000, compared with GBP693,000 a year earlier.
On the other hand, revenue from the sale of existing territories increased 75% to GBP226,000 from GBP128,800 a year earlier, all of which were to new franchisees.
Following a fund raising in November 2013, Belvoir supported the purchase by franchise owners of three lettings agencies in Aldershot, Hereford and Nuneaton.
These new businesses will accelerate the growth of the franchise owners, increase their share of the local market, and add noticeably to Belvoir's management service fee revenue, the company said.
Looking ahead, the AIM-listed company said housing supply is failing to keep pace with the UK's increasing population, putting further pressure on the private rental sector and the property sales market.
"Belvoir, therefore, is positioning itself to exploit the continuing expansion of the lettings market and the buoyancy of the sales market by increasing the number of franchised territories and helping franchise owners to expand their portfolio of lettings and sales through organic and acquisition growth," Chairman Mike Goddard said in a statement.
The interim dividend was maintained at 3.4 pence per share.
Belvoir Lettings shares were quoted up 1.2% at 128.50 pence Wednesday.
By Anthony Tshibangu; anthonytshibangu@alliancenews.com; @AnthonyAllNews
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