Profits plunged at Countrywide in the first half of this year.
An operating profit of £28.3m in the first half of last year plunged to £6.5m, while revenue was down from £370.3m to £333m.
Sales transactions were down from 33,940 to 27,100.
CEO Alison Platt was defiant, saying: “We are building a stronger business for our future and remain on track to broaden our digital capability, reduce our operating cost base and strengthen our balance sheet.”
But she admitted: “The first half of 2017 was tough for the Group.”
She added that the same period last year had been boosted by “the high levels of housing transactions brought forward in time as a result of the Stamp Duty changes and the EU referendum. Our income versus the first six months of 2016 is down 10% and our adjusted EBITDA down 26%.”
Platt said Countrywide had made “real progress in extending our multichannel offering”.
She went on: “On 31 July we will have completed the rollout of our digital fixed price proposition to 50% of our branches.
“This offer gives our customers the choice to transact digitally and at a fixed cost but with the assurance that they are able to upgrade to the full service proposition in branch without losing the money they have already paid.
“We have increased traffic to our estate agency websites, have been invited to carry out more market appraisals and have won more instructions.
“We have held or gained market share in the instructions that have the new offering and also learned that, even where our digital proposition is available, over 95% of customers still choose to take advantage of the services we offer in branch, confirming what we expected: that a combination of digital capability and local market expertise is what customers really want.”
The company said this morning it will not be paying its shareholders an interim dividend.
At Foxtons, there will be a dividend, although lettings and sales revenue were both down – by 2% and 29% respectively – for the half year ending in June.
Lettings revenue was £32.1m, and sales revenue was £22.2m. Like Countrywide, it also cited the sales surge of spring last year.
Profits before tax at Foxtons were £3.8m down from £10.5m. Revenues were down just over £10m, from £68.8m in the first half of last year, to £38.5m.
Chief executive Nic Budden said: “Our performance has been resilient in the context of a London property market that has been further impacted by unprecedented economic and political uncertainty.”
Both firms were this morning reporting to the stock exchange.
City analyst Anthony Codling, of Jefferies, said of Countrywide that it “is doing the right things” in “taking out costs, offering complementary digital services and growing the financial services division. However the costs of this strategy are being felt before the benefits and whilst it is difficult to see Countrywide receiving any help from the underlying housing market, we do see silver linings amid the clouds”.
Of Foxtons, he said that its results were at the top end of expectations, amid the “dreadful” London sales market. He described Foxtons as a fighter, with the stamina to stay in the ring for many more rounds to come.
In early morning trading, shares in Countrywide fell heavily. In the first 40 minutes, they were down about 10% to just under 150p.
Foxtons shares fell about 5% to 91p.