HUNT.L Regulatory News (HUNT)

Embargoed until 07:00am Thursday

30th January 2020

The information communicated in this announcement contains inside information forthe purposes of Article 7 of EU Regulation 596/2014.

Hunters Property PLC

("Hunters" or "the Group")

Year end trading update

Hunters Property Plc ("Hunters" or the "Company" or the "Group" (Aim: HUNT)), one of the UK's largest franchised sales and lettings agency businesses, is pleased to provide the following trading update ahead of its final results for the year ended 31 December 2019.

Summary Headlines:

- A stronger finish to 2019, with Network Income for the year up 7% at £42.4m

- Ahead of plans to mitigate against the implementation of the tenant fee ban

- Housing market sentiment improving

We are pleased to report the Group finished 2019 strongly, increasing Network Income1 for the year by 7% to £42.4m (2018: £39.4m). We opened 20 branches during the year bringing the total Network's branches to 206. The average Network Income from branches that joined in 2019 was £278,000 (2018: £186,000).

Since the tenant fee ban was introduced on 1 June 2019 we have been steadily mitigating its impact, to less than 1.5% of turnover for those seven months. Overall our Network Income in Lettings increased by 12% and in Sales by 5%. Our underlying strategies and unaudited results have exceeded expectations.

We are delighted to announce that in 2019 we retained our 96% Customer Service Rating (2018: 96%), the 8th year in a row where we have exceeded 90%, and that Network Income per branch has grown 3% to £206,000 (2018: £200,066) despite the market's challenges2. 

We announced a further investment in technology last year with the aim to keep us at the forefront of productivity and efficiencies across our branches. We remain pleased this project remains on track. The plan is to roll out following testing and to have all offices converted by the end of 2021. We look forward to updating you on progress further in the year.

We continue with our assisted acquisition programme to help branches buy businesses. We have invested in 7 lettings books over the last 18 months and this remains a policy that we are keen to develop further. For 2019 our income split was 66/34 Sales/Lettings (2018: 67/33).

Though we are only four weeks into the new year the view in the market is that sentiment feels to be improving and we look forward to updating you on our progress when we announce our full year results for 2019. As things stand, we anticipate that we will be ahead of expectations. We believe market conditions and increasing compliance requirements will continue to motivate proven independent operators to become part of stronger group. Growing the lettings business as well as having grown to third in the market for Sold Subject to Contract 3, our investment in technology, training, marketing, and significant cost reductions, particularly in terms of portal charges means Hunters are well placed to attract independent agents looking to progress. We retain a strong financial position to both expand our network and with healthy dividend cover look to increase and maintain the Company's progressive dividend policy.

Glynis Frew, Chief Executive, said:

"We are pleased that our underlying business strategies have delivered ahead of the tenant fee ban and market challenges. I am delighted with our Customer Service results as customers will always be our primary focus. Going forward, our technology project will enhance our service by driving productivity at a local level whilst simultaneously facilitating cost reductions in branches. This, combined with our success in growing branch numbers organically means we are optimistic for continued success over the next few years."

The Company expects to announce its full year results on or around the 2 April 2020.

For further information please contact:

Notes:

1 Network Income is the gross sales and lettings revenue of the Franchisee and Owned branch network.

2 Instructions in sales for 2019 were down 3.4% - Source: Rightmove, 15 January 2020

3 Source: TwentCI, 15 January 2020