The firm had issued revenue guidance of £165-£175m in its interim results for the 2018/19 financial year. However, it has now cut that back to £130-£140m.
While Purplebricks said that the UK housing market has “continued to be challenging” for the estate agency industry, it nonetheless expects to report UK revenues will increase year-on-year by up to 20%, with an adjusted EBITDA margin in double digits. It said it expects to maintain its 75% share of UK online instructions.
The firm’s difficulties instead lie elsewhere, particularly in Australia where the firm said the market is experiencing “a number of headwinds”. As a result the “anticipated amount of recognisable revenue will not be sufficient to meet expectations” for this financial year.
In addition, its attempts to break into the US market have been underwhelming, with a “slower than expected” response to its latest marketing initiative.
Michael Bruce, chief executive officer and co-founder of Purplebricks, said that the firm was well placed to take advantage of the significant growth opportunities in each country in which the firm is active, “albeit not entirely as we would have wanted before our year end.”
He added: “The UK is leading the way with continued profitable growth and a strategy to deliver greater success.”
A change at the top
Lee Wainwright, UK chief executive officer, will leaving the business shortly too. Wainwright has been at the business for two years and is leaving for personal reasons. His responsibilities are to be taken on in the interim by Vic Darvey, the agent’s group chief operating officer, who joined at the start of this year from Moneysupermarket.
Eric Eckardt, the US chief executive officer, is also leaving.