Countrywide sees shares take a dive as it warns of a tough end to the year

SHARES IN Countrywide tanked on Thursday after Britain’s biggest listed estate agency warned that a poor end to 2017 would see profits knocked.

In a trading update covering the year to December 31, the group flagged a “disappointing” fourth-quarter performance, which will result in full-year income coming in at around £672m, down from £737m last year.

Fourth-quarter income is forecast to fall to £164m from £179m and full-year earnings are also set to come in lower at £65m versus £83.5m. The decline was driven by its UK business, in particular London, Countrywide said. Sales and letting income is expected to be around £205m, down 17 per cent year on year, and in London is forecast to be 10 per cent down at £155m.

Shares plunged over 15 per cent to 114.5p in morning trading. The housing market has experienced a marked slowdown since the Brexit vote, and Countrywide said last year that the EU referendum had a “sustained impact on sentiment”, with fewer buyers and sellers coming to the market.

Anthony Codling, equity analyst at Jefferies, said: “The compounding of changes in external market conditions and the internal operations have taken their toll on Countrywide.

“The residential markets were more challenging in 2017 than Countrywide originally anticipated.

“As a result, the group made some significant changes to the leadership team last year as it sought to address underperformance. Countrywide remains the UK’s largest estate agency group, and although it is by no means firing on all cylinders, we would rather tune the existing infrastructure than build one from scratch.”