Purplebricks: Shareholders reject motion to oust chair after dismal financial performance
Purplebricks’ shareholders rejected a proposal to oust the online estate agency’s chair as its head insisted that improvements were on the way.
The troubled firm said a proposal by major shareholder Lecram Holdings to remove Paul Pindar was rejected.
Some 71.71 per cent of votes in a general meeting were against the resolution proposed by Lecram, which holds a 5.16 per cent stake in the property firm.
Purplebricks also said that 58.2 per cent of the votes were against Lecram’s call for appointing Harry Hill, the founder of property platform Rightmove, to the board.
In a statement after the vote, Lecram said that “a majority of independent shareholders not represented on the board” had backed the motion to oust Pindar, as well as nearly 30 per cent of shareholders who voted.
“We note the company has recognised the level of feeling among investors and it should draw the appropriate conclusion,” the statement from Adam Smith’s investment vehicle said.
“There is also considerable support for bringing Harry Hill, who is both experienced in the sector and independent, onto the board,” Lecram added.
The London-listed company’s share price dropped more than two per cent on Monday afternoon. It has plunged more than 60 per cent over the year to date.
New chief executive Helena Marston is overseeing a turnaround plan, which she said was “being delivered at pace” on Monday.
Marston said she wanted to reassure all shareholders that the board understood their concerns and admitted the firm’s past performance “has not been good enough.”
“The operational changes implemented over the last four months will be clear for all to see at our final results, in terms of a substantially improved cash and profit performance,” Marston said.
Purplebricks’ head said the firm’s leadership “take nothing for granted” and were “fully committed” to improvements.
In financial results published earlier this month, Purplebricks revealed that its gross profit had plunged more than a third in the six months to the end of October.
Its revenue dropped 16 per cent to £34.5m while its operating losses also swelled by five per cent to £11.7m.
The dismal results caused Lecram to reiterate calls for the removal of Pindar, with the shareholder lamenting that “nothing is improving.”
“We are entering one of the worst housing market conditions in a generation, yet the leadership seems to have an overly optimistic view of prospects,” Lecram said following the interim results.
“Shareholders can’t afford to wait any longer while this business runs out of money, they need to act and act quickly to change the chairman if there is any hope of salvaging value for all investors.”