Estate agent Foxtons cuts earnings guidance after ‘toughest’ year ever in London

Estate agent Foxtons said last year was one of the “toughest sales markets” ever in London and expected earnings to drop 80 per cent on the previous year.

The company said it expected market conditions to remain challenging this year.

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It expected full-year revenue to fall six per cent to £111m when it publishes results next month but said adjusted core earnings would plummet to £3m from £15m in 2017.

Foxtons blamed a fall in sales volumes and increases in expenses as it invested in its “people, technology and brand.”

Chief executive Nic Budden said: “2018 was one of the toughest sales markets we have ever had in London with transactions falling from last year’s historically low levels.

“Considering this, we have delivered a solid performance and taken steps to ensure the business is best prepared for these conditions through prudent actions on cost and enhancements to our proposition.

“We are confident in our model which provides high levels of service to achieve the best results for our customers.”

Sales revenue for the year fell to 16 per cent to £36m, while fourth quarter sales revenue was £9m, down from £10m the previous year.

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Foxtons closed six London branches in the second half of last year and said the closures, and other cost-saving initiatives would deliver £3m during 2019.

The company said it had now become accustomed to operating in tough market conditions and said its leaner cost base and lack of debt meant it was well placed.