Foxtons reported another year of significant earnings growth yesterday, surpassing market expectations and reinforcing its position as a key player in the UK property sector.
In a trading update to the City the Group reported total revenue reached approximately £163m, up 11% from £147.1m in 2023, while adjusted operating profit surged 33% to around £19m for the year ended December 2024.
This growth, driven by higher revenues and the company’s strong operating model, has led to improved profit margins.
Foxtons’ lettings division continued to be a pillar of strength, with revenue climbing 5% in 2024. Q4 revenues alone were up 11% compared to the same period in 2023, thanks to strategic acquisitions and organic growth. With its recurring nature, the lettings business remains a robust and non-cyclical revenue stream, reinforcing the Group’s cash flow stability.
AGGRESSIVE ACQUISITION STRATEGY
The Group’s aggressive acquisition strategy also played a crucial role, adding over 2,900 tenancies to its portfolio through the purchases of Haslams Estate Agents and Imagine Property Group in October 2024. The acquisitions, worth a total of £12.6m, bolstered Foxtons’ expansion in the high-growth commuter towns of Reading and Watford. Both businesses have performed in line with expectations, paving the way for further bolt-on acquisitions and market penetration.
SALES DRIVEN PERFORMANCE
Sales revenue soared by approximately 30%, fuelled by a 20% market share increase and a 10% recovery in London transaction volumes. Although average sales prices remained flat in line with broader market trends, Foxtons successfully curtailed sales operating losses, significantly boosting overall profitability.
ALEXANDER HALL
The Financial Services division, Alexander Hall, also posted solid growth, with revenues rising by 6% and Q4 revenues jumping 15% year-on-year. Under the leadership of a new Managing Director Richard Merrett appointed in January 2024, the business has undergone a strategic overhaul, improving adviser productivity and capitalising on market improvements.
OUTLOOK FOR 2025
Entering 2025, Foxtons expects lettings to remain resilient, supported by robust tenant demand and healthy stock levels. In sales, the company begins the year with its strongest under-offer pipeline since 2016, driven in part by first-time buyers rushing to complete transactions ahead of Stamp Duty hikes in April 2025.
Early indicators suggest buyer activity remains above 2024 levels, despite lingering concerns about interest rates and consumer confidence. A favourable economic environment, coupled with operational enhancements, could see Foxtons’ sales division return to profitability in the near future. The pace and scale of interest rate cuts will be key determinants of buyer demand, with faster reductions potentially accelerating market growth.
TURNAROUND STRATEGY
Guy Gittins (main picture), Chief Executive Officer, said: “I’m delighted that we have delivered a second consecutive year of revenue and profit growth since I returned to the business in September 2022, as our turnaround strategy continues to deliver results, and we ended the year with earnings ahead of market expectations.
“Our renewed focus on training, culture, and retention, supported by our best-in-class data and technology, has driven double-digit market share gains in Sales and revenue growth in Lettings. In addition, we have made two acquisitions in commuter towns as we expand into exciting new growth markets.
“We enter 2025 with optimism. We expect the Lettings business to remain resilient and, in Sales, we start the year with the highest opening under-offer pipeline since the Brexit vote in 2016. This dynamic, coupled with our results-driven culture and industry-leading Foxtons Operating Platform, leaves us well placed to continue to deliver against our strategic priorities in 2025.”
IMPRESSIVE
TV pundit and industry expert Russell Quirk took to LinkedIn to hail the Group’s results. Quirk, whose PR firm ProperPR also represents Foxtons, stated: “It’s financial results published yesterday were impressive – revenue up 19%, profits up 33%. Lettings revenue is up 5%. But, sales revenue is up 30% year on year. That’s huge.
“Foxtons’ sales pipeline is higher now than at anytime since 2016. It’s an outperformer and under the tenure of Guy Gittins and team has seen its share price double from sub 35p in 2022 to nearly 70p now. That’s £100m added to its market cap.”
WINNING CULTURE
And he added: “It seems that a return to a culture of ‘winning’ and celebrating success and a focus on data and lead nurture has led to this. Kudos.
“But here’s the really impressive thing that isn’t being talked about… Whilst Gittins has increased shareholder value by 100%, the share price of other comparable businesses has fallen significantly. Savills down 15% in the same period. LSL down 25%.
“I’m not a ‘buy shares’ kind of chap (I prefer cars). But if I was…”
Foxtons will publish its full-year results on 5 March 2025.
