Belvoir Group PLC (AIM:BLV) is trading in line with management’s expectations in 2022, the property franchise group revealed ahead of today’s annual general meeting (AGM).
Group revenue in the first four months of the year was up 14% on the same period in 2021, with the property division up 8% and the financial services division up 20%.
Management service fees (MSF), which Belvoir regards as the key underlying income stream from its property franchise division, are up 1% on 2021.
As the sales market normalised after exceptionally buoyant trading in 2021, the number of UK residential property transactions fell by 24%, the company said in its AGM statement.
Meanwhile, the UK rental index rose to 2.7%, the largest annual growth since January 2016. Against this backdrop of changing dynamics in the housing market, MSF from lettings increased by 4% mitigating the 11% lower level of MSF from sales, and Belvoir's lettings to sales ratio in the first four months of the year was 78:22 up from 74:26 the previous year.
Income from the financial services division was up 20% with Belvoir's adviser network at 243 as at the end of April 2022 (April 2021: 214).
“As the market for new house mortgages has tailed off in line with residential property transactions, our mortgage advisers have been able to service the group's extensive client base during what has been a busy period for remortgages, exacerbated by increasing interest rates,” the statement said.
“We have continued to focus on the group's growth by supporting our franchisees and advisers to ensure that they are best placed to respond to the market conditions, and furthering the group's ambitious growth plans through two strategic acquisitions,” said Dorian Gonsalves, the chief executive officer of Belvoir.
"With the brokerage model growing within the estate agency sector, the key strategic driver for the acquisition of Mr and Mrs Clarke was to introduce a high-quality personal agency model to the Belvoir Group to complement its existing high street brands.
“The recent acquisition of TIME Group will enable us to further strengthen our offering of mortgage advice through our property franchise network in the Midlands and the North, where the Belvoir Group property brands are well represented,” he added.
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Gonsalves said the board remains confident that its business model and growth strategy present a strong investment case for shareholders and will deliver enhanced value for all of its stakeholders.