Bricking it
Troubled online estate agent ousts boss
THE founder of online estate agent Purplebricks has got the boot after a run of rotten results.
Michael Bruce was ousted as chief executive, seven years after starting the business with his brother Kenny.
Purplebricks is the best known of a new breed of estate agents which shook up the market by claiming to undercut high street rivals.
But the firm issued a string of profit warnings last year, and admitted standards slipped as it chased overseas expansion.
The company also announced yesterday it was pulling out of the Australian market, and put the future of its American venture in doubt.
The firm – whose fee is payable even when your property does not sell – has also been hit by a slowdown in the UK housing market.
Purplebricks had a £1billion stock market value when it floated in 2015, topped £1.4bn in 2017, but has seen that slump to just over £400million now.
Its share price tumbled another 11% yesterday, having crashed 76% from its peak in July 2017.
Chairman Paul Pindar said: “We sincerely apologise to shareholders. With hindsight, our rate of geographical expansion was too rapid and as a result the quality of execution has suffered.
“We will learn from the errors and will not make them again.”
Outgoing chief Bruce is the firm’s fourth biggest shareholder, with an 11% stake.
He is replaced by Vic Darvey, Purple Bricks’ chief operating officer, who only joined from Moneysupermarket in January.
The firm says sales for the year to the end of April are expected to be between £130million and £140m.
But the City forecasts its losses will nearly double, from £26m to around £50m.
Purplebricks’ biggest shareholder is Woodford Investment Management, with a near 29% stake, followed by Merian Global Investors, and German publishing giant Axel Springer.