Foxtons (LSE:FOXT) has unveiled an increase in revenue for last year, as the estate agency turned its focus to lettings on the back of housing market weakness.
Revenue climbed by 5% to £147.1 million in the year to December, the estate agent said in an update on Tuesday.
This came as lettings revenue, which accounts for most of Foxtons (LSE:FOXT)’ income, climbed by 16% to £101.2 million, aided by acquisitions of the likes of agents Atkinson McLeod and Ludlow Thompson.
According to Foxtons (LSE:FOXT), an increased focus on the lettings market has offered a “more resilient earnings stream”, as high mortgage rates prompt people to rent for longer.
That said, Foxtons did acknowledge growth in the rental market was slowing, as high prices prompt an oversupply of properties.
However, the group said this offered opportunities to grow market share further, after £13.9 million was spent on lettings acquisitions last year, resulting in net debt of £6.8 million.
Pre-tax profit slipped 34% to £7.9 million over the year, with operating profit climbing by 2% to £14.3 million on an adjusted basis.
“2023 was a year in which Foxtons has been fundamentally transformed,” chief executive Guy Gittins commented. “We have achieved a lot in a short space of time”.
“Our strategy to deliver growth through sales market cycles by delivering lettings growth is working, delivering resilient earnings for the year despite a weak sales market.”
Shares were sent 4.6% lower in morning Tuesday trades.