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LSL looks for further acquisitions with pre-tax profit up 52%

  • 02/03/2011
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LSL Property Services has reported a pre-tax profit of £25.8m, up 52% from 2009 and said it's looking for further acquisitions this year.

In the group’s 2010 preliminary results, its acquisition of networks Home of Choice and Pink Home Loans last year transformed into one of the largest UK mortgage intermediaries. 

While both networks did not contribute directly to the group’s 2010 operating profit, it still saw its like-for-like financial services income increase by 6% from £11m to 11.8m.

Roger Matthews, chairman at LSL Property Services said that the group is well positioned for further acquisitions.

He said: “LSL still has a cautious view of the market for 2011 in view of the ongoing shortage of available mortgage finance and broader well documented economic challenges. However, we are confident that the group can build on the market share gains made in 2010 and grow the business even in these market conditions.
“With a very strong balance sheet, we are well placed to grow both organically and through further acquisitions in the current market and deliver further substantial growth when transactions volumes recover,” he explained.

The group reported that mortgage approvals for house purchase dropped 4% from 597,000 in 2009 to 575,000 last year, and was less than half the historic norm of 1.2m per annum.

Remortgage activity was relatively weak at 328,000 last year, 4% lower than in 2009 (343,000).

Total mortgage approvals fell from 1.3m in 2009 to 1.2m in 2010, a drop of 7%.

Despite this, Matthews said that the estate agency and surveying divisions had both witnessed growth in market share.

In the estate agency division, the group reported the acquisition of the Halifax Estate Agencies Limited (HEAL) business had given it the largest lettings network and also market leadership in the repossessions market.

HEAL returned a profit of £0.4m during the second half of 2010 after a loss of £3.6m in the first half of the year. 

Matthews added that the growth had been driven by “a strong contribution from its counter cyclical income streams.”

The surveying division increased turnover by 16%, from £70m in 2009 to £80.9m against a market decline of 7% in total mortgage approvals, which fell from 1.3m in 2009 to 1.2m in 2010.

Matthews said that the group’s expansion of the Santander contract in surveying had helped consolidate its market leadership last year.

He added that the group had also benefitted from “extending its surveying services” to the private survey market last year. 


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