Embattled estate agency Countrywide has reported a loss of £208.1m in its preliminary full year results for 2017.
Countrywide said the huge post-tax loss reflected £225.9m of “principally non-cash exceptional charges for goodwill, intangible and other asset impairments”.
Income for the year fell to £671.9m, down 8.8% on 2016, which it attributed to poor performance in its sales and lettings division. Pre-tax earnings were down 45% to £26.4m.
Chief executive Alison Platt announced her resignation from the company in January, with executive chairman Peter Long taking over in the meantime. He said the group would be undertaking a “back to basics” approach, with Paul Creffield also being promoted to group operations director.
Long said: “The underperformance of our business over the last three years has resulted in us making significant management change in the group. Industry expertise in all areas of our business is key. Within sales and lettings, the previous strategy resulted in us losing a lot of that expertise.
“In the group, we are fortunate in that we have an industry veteran, Paul Creffield, who has been promoted to the role of group operations director. His deep understanding of the market and operations means that we have quickly been able to identify what we need to do to begin addressing our underperformance.
“We believe these business units are fixable, we know what we have to do to restore them and the steps to take that should result in a return to profitable growth. This will take time but ultimately there will be much upside for our group and our shareholders, whose patience has been sorely tested recently.”
Of the £225.9m incurred in exceptional charges, £7.9m was through redundancy costs and cost optimisation, while exceptional impairment charges against goodwill accounted for £192.3m, and against brands names £12.9m.
Of the £192.3m, Countrywide said: “Goodwill impairment charges of £151.3m and £41m respectively have been made in relation to the UK and London cash-generating units following an assessment of the recoverable value against the carrying value.”
Lambert Smith Hampton, which the group owns, saw a relatively successful year.
Countrywide said: “Despite the challenging uncertain economic and political environment during 2017, Lambert Smith Hampton, our commercial business, delivered a strong performance. LSH retained every major customer that came up for renewal in 2017. Revenue saw a marginal 0.2% increase year on year, with adjusted EBITDA increasing by 9.6%.”
Pic credit: Monkey Business Images/Rex/Shutterstock
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