Lsl Prop Regulatory News (LSL)

For immediate release 28 January 2020

LSL Property Services plc ("LSL")

Full Year Trading Update

LSL Property Services plc, a leading provider of residential property services incorporating estate agency, financial services and surveying businesses, issues a trading update for the year ended 31st December 2019.

Overview

We anticipate full year Group Underlying Operating Profit(1) for the year ended 31st December 2019 will be slightly ahead of the Board's prior expectations and slightly ahead of last year which is a highly resilient performance in the context of challenging residential market conditions during 2019.

Group revenues for the year ended 31st December 2019 decreased by 4% including the impact of the reshaping of the Your Move and Reeds Rains branch networks announced on 5th February 2019. Excluding the impact of the planned closure of the Your Move and Reeds Rains branches during Q1 2019, Group revenues for the year ended 31st December 2019 increased by 4%.

Estate Agency Division performance

For the twelve month period ended 31st December 2019, Estate Agency(2,3) revenue was down by 16%, materially impacted by the planned reduction in the size of the Your Move and Reeds Rains branch networks during Q1 2019. Excluding the impact of the closure of the Your Move and Reeds Rains branches, Estate Agency revenue(4) for the twelve-month period was down 4%. 

Whilst London market conditions continued to be challenging during the year, Marsh & Parsons delivered a resilient revenue performance over the twelve month period with total revenue down 3%. Residential exchange income was down by 5% and Lettings income declined by 2%.

Financial Services Division performance

Revenue performance for the Financial Services Division for the twelve month period is as follows:

·; Financial Services organic revenue growth was 1% year on year, excluding Estate Agency

·; Total Financial Services Division(2) revenue including Estate Agency for the year was down by 2%, reflecting the impact of the planned closure of the Your Move and Reeds Rains branches

·; Total appointed representative firms increased by 4% with a 3% increase in the number of financial advisers

Surveying Division performance

The Surveying Division delivered a revenue performance growing 24% year on year, which included a material contribution from the successful commencement of the Lloyds Bank plc surveying and valuation services relationship.

Strong balance sheet

At 31st December 2019 the Group had net banking debt of £41.9m (2018: £32.1m), which is a level of gearing the Board is comfortable with.

Outlook and notice of results

Whilst it is too early in the year to give a view on the 2020 market outlook, the combination of increased political stability and a favourable LSL estate agency sales pipeline on 1st January 2020 compared to the LSL Board's prior expectations provide a positive backdrop to the start of 2020.

We will provide our view on 2020 outlook with the release of our Preliminary results for the year ended 31st December 2019. LSL will report 2019 full year results on 10th March 2020.

Notes to trading update

1. Group Underlying Operating Profit is before exceptional gains and exceptional costs, contingent consideration, amortisation of intangible assets, share‐based payments and on an IFRS16 basis

2. Following the change to LSL's segment reporting effective from 1st January 2019, the Estate Agency Division receives a commercially agreed commission payment from the Financial Services segment. This arrangement reflects Financial Services income generated from the Estate Agency segment. The 2018 revenue has been restated on this basis to assist comparison

3. Estate Agency Division revenue metrics presented in this statement include Marsh & Parsons Revenue

4. Revenues have been restated on a like for like basis to exclude the impact of the closure of the Your Move and Reeds Rains branches during Q1 2019

All figures quoted in this update are unaudited.

For further information, please contact:

Ian Crabb, Group Chief Executive Officer Adam Castleton, Group Chief Financial Officer

LSL Property Services plc 0207 382 0360

Helen Tarbet, Simon Compton

Buchanan 0207 466 5000

Notes on LSL:

LSL is a leading provider of residential property services to its key customer groups. Services to consumers include: residential sales, lettings, surveying, conveyancing support, and mortgage, pure protection and general insurance brokerage services. Services to mortgage lenders include: valuations and panel management services, and asset management and property management services. For further information, please visit LSL's website: lslps.co.uk