Purplebricks shares jump as estate agent expects to beat profit forecast
Shares in Purplebricks jumped this morning as the online estate agent said it expected to post strong profit for the first half of the year following a jump in new instructions after lockdown restrictions eased.
The firm’s share price was up more than five per cent this morning after it said new instructions in the six months to 31 October increased eight per cent to 35,387 compared to last year.
Instructions were up 20 per cent for the five months since June, Purplebricks said, and adjusted earnings before interest, tax, depreciation and amortization is expected to beat consensus for the full year.
Purplebricks expects to report “a pleasing profit” for the first half, but warned that the end of the stamp duty holiday and additional coronavirus restrictions could dampen growth in the second half.
The AIM-listed firm had more than £75m in cash at the end of October, compared to £66m in July.
Purplebricks chief executive Vic Darvey said: “Our growth in instructions through the period demonstrates that Purplebricks’ proposition has never been more relevant, particularly in the current market, and our strategic progress has helped us to capitalise on the pick-up in market activity.
“We expect to deliver a pleasing profit performance in the first half, but it is too early to extrapolate this out to the second half of the year given the expected end to the stamp duty holiday and the potential impact of increased Covid-19 restrictions on the housing market. As a result, we are planning cautiously around the outlook for the full year.”