Pur­ple­bricks ramps up UK dom­i­nance as rev­enues soar

The Daily Telegraph - Business - - Technology Intelligence - By Jack Tor­rance

PUR­PLE­BRICKS has re­asserted its dom­i­nant grip on the UK on­line es­tate agency mar­ket, re­port­ing a 20pc surge in half-year rev­enues de­spite a slow­down in the wider sec­tor.

The Aim-listed com­pany said it had main­tained its 74pc share of the on­line mar­ket in an in­vestor up­date, af­ter ri­val Emoov put it­self up for sale. Michael Bruce, Pur­ple­bricks chief ex­ec­u­tive, said the slug­gish mar­ket had led to a “shake­out” in the in­dus­try, “high­light­ing weak­nesses in both some tra­di­tional and on­line agents’ busi­ness mod­els”.

Pur­ple­bricks said the higher rev­enues were the re­sult of dou­ble-digit growth in cus­tomer num­bers, as well as swelling sales of an­cil­lary ser­vices such as in­sur­ance and con­veyanc­ing.

The com­pany, which charges a flat up­front fee of be­tween £899 and £1,399, has grown rapidly as home sell­ers have sought a cheaper al­ter­na­tive to high street es­tate agents.

But while its UK arm is now in the black on an op­er­a­tional ba­sis, the wider group in­clud­ing nascent arms in the US, Canada and Aus­tralia is yet to turn a profit. Pre-tax losses in the year to April rock­eted more than four­fold to £26m.

Its shares closed up 2pc at 185p but are still down by more than half in the year to date.

Its US busi­ness, launched about a year ago, now em­ploys 140 agents in seven states in­clud­ing Cal­i­for­nia. Ac­cord­ing to the com­pany, 44pc of Cal­i­for­ni­ans now recog­nise its brand, “ahead of the UK equiv­a­lent at the same time in its de­vel­op­ment”.

Pur­ple­bricks said its Aus­tralian busi­ness had bounced back amid a “tough mar­ket back­drop” and its Cana­dian arm, ac­quired in July, has been “per­form­ing strongly”.

It re­cently struck a deal to en­ter main­land Europe for the first time, buy­ing a stake in Ger­many’s mar­ket leader Home­day through a joint ven­ture with me­dia gi­ant Axel Springer.

Rus­sell Quirk, chief ex­ec­u­tive of Emoov, which is one of Pur­ple­bricks’ big­gest on­line com­peti­tors, told the

Fi­nan­cial Times on Fri­day that the com­pany was seek­ing a buyer af­ter find­ing it­self in a “slightly pre­car­i­ous” fi­nan­cial po­si­tion.

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