(Alliance News) - Purplebricks Group PLC on Friday said its turnaround plan continues at pace, with positive cash generation expected in financial 2024, in spite of short term costs.
Purplebricks shares were down 17% trading at 8.24 pence per share on Friday morning in London.
The Solihull, England-based online estate agent said in the third quarter of the year ending April 30, it implemented a revised go-to-market strategy aiming to focus resources and investment into currently profitable regions and those with opportunities to increase the company's market share.
The company said the implementation of the strategy involved more disruption to the sales field than expected in order to meet the required savings and improvements to efficiency.
Purplebricks said it had incurred costs of GBP1.2 million during the second half so far. Instruction numbers in the third quarter were lower than expectations, the company said, adding that in response to this, it has identified GBP4 million in further annual cost savings.
The company said the savings will be made by streamlining its lettings business and through conservative investment in its mortgages business
Purplebricks said it now expects to deliver revenue between GBP60 million and GBP65 million in 2023, and adjusted loss before interest, tax, depreciation and amortisation of between GBP15 million and GBP20 million.
Chief Executive Officer Helena Marston said: "We have undertaken a huge amount of work in the last 9 months to improve our sales business, raise standards, establish Purplebricks Financial Services, and stabilise lettings, all of which means the company has never been in better shape for the future.
"Yes, the actions we have taken have caused more short-term disruption to our Q3 performance than anticipated, but we remain confident in returning to positive cash generation in early FY24."
The company said it will carry out a strategic review, as "the potential of the group may be better realised under an alternative ownership structure."
By Harvey Dorset, Alliance News reporter
Comments and questions to newsroom@alliancenews.com
Copyright 2023 Alliance News Ltd. All Rights Reserved.
