(Alliance News) - Belvoir Group PLC on Wednesday said it expects pretax profit for 2020 as a whole to be "comfortably ahead" of management expectations, based on strong trading in the first ten months.
Shares in Belvoir were up 7.0% at 152.40 pence on Wednesday in London.
For the period to the end of October, the estate agent franchise firm reported a 10% rise in gross profit year-on-year from the property division, as management services fee from lettings was up on 2019, while fees from sales remained flat.
The pipeline of agreed house sales was significantly ahead of the prior record level, Belvoir said, meaning that the franchisees are expected to report strong sales revenue during the last two months of 2020.
Belvoir's financial services division posted an 11% increase in gross profit, with an 18% increase in the adviser network since the start of the year.
Looking ahead, the company said it has continued to benefit from its efforts to reduce its cost base at the start of the pandemic, leading to overheads being significantly lower than the original budget.
As a result, Belvoir expects its performance for 2020 to be ahead of management expectations.
In addition, the group will pay a catch-up dividend of 1.3 pence per share. This represents the last payment in respect of the final dividend of 2019, which was suspended in March 2020. This will bring the total reinstated dividend for 2019 to 3.3p.
Finally, due to resilient trading, Belvoir will reimburse staff in full for salaries sacrificed during the period, and to repay the UK government in full the Covid furlough money and grants received.
In the UK's first lockdown period, Belvoir's board and all employees earning over GBP25,000 took a pay reduction of between 20% to 30%, which was reversed in July.
"This year has demonstrated beyond doubt the incredible resilience of our franchise business model. In what has been a rollercoaster of a year for Belvoir, the group has performed well across both divisions. I am immensely grateful to our all our employees who have worked tirelessly to support our networks of property franchisees and financial service advisers through this challenging period," said Chief Executive Officer Dorian Gonsalves.
By Dayo Laniyan; dayolaniyan@alliancenews.com
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