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(Alliance News) - Mortgage Advice Bureau Holdings PLC shares fell on Tuesday, after its interim profit dropped and its outlook worsened slightly due to a slowing of conversion in its pipeline.
In the first half of the year, the Derby, England-based mortgage advice provider said revenue rose 4% to GBP96.5 million from GBP92.4 million year-on-year
However, pretax profit fell 6% to GBP10.1 million from GBP10.8 million.
Shares in MAB fell 11% to 812.00 pence each in London on Tuesday mornign.
Revenue per mainstream adviser fell 13%, as pipelines took longer to convert. This was also due to "a very strong comparative in [the first half of 2022] as a result of stamp duty holiday changes accelerating house purchase mortgage completions in that year", the firm explained.
Heading into the second half, its pipeline of written new business was 30% higher than anticipated, due to the extended completion timeframes. It said housing transaction volumes are expected to remain steady, despite a slight cooling in consumer demand.
It noted the increasing interest rates have seen its advisers experience "constant change" and short notice withdrawals of mortgage products, which it expects to continue as uncertainty persists.
It now expects a "slight reduction" in its financial result for 2022 as a whole compared to previous expectations. This will primarily be a result of the continuing slowness of its pipeline, softening purchase activity, and "an increasingly cautious approach to recruitment by some [appointed representatives]".
It declared an interim dividend of 13.4p, unchanged from the previous year.
On a more hopeful note, MAB welcomed recent government reforms.
"We expect the recent mini budget to support the housing and mortgage markets. The stamp duty changes that help aspiring first-time buyers are particularly welcome, demonstrating the government's ongoing commitment towards maintaining a healthy and active housing market," the firm said.
As part of the not-so-mini budget announced on Friday, UK Chancellor Kwasi Kwarteng confirmed a permanent cut to stamp duty, with properties up to GBP250,000 to be exempt from the tax. The threshold for first-time buyers was also increased to GBP425,000 from GBP300,000.
By Elizabeth Winter; elizabethwinter@alliancenews.com
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