Shares in the UK's largest estate agent have tumbled after it admitted pre-tax profit plummeted by close to 60 per cent last year.
Countrywide, the company behind high street estate agency brands including Bairstow Eves and Hamptons International, said today its total income rose to £737m in the year to the end of December, up 0.4 per cent from the year before.
Pre-tax profit, though, fell 59.1 per cent to £19.5m, from £47.7m the year before.
Retail exchanges rose one per cent to 50,891 in 2016 - although in the capital the number of exchanges fell 14 per cent to 10,423. Total income in the capital fell 10 per cent to £160.4m.
As a result, the company announced a share placing of 9.99 per cent of its share capital, which it said will reinforce its balance sheet.
Its decision not to pay out a final dividend pushed shares down four per cent to 179.75p in mid-morning trading.
Why it's interesting
Like Foxtons yesterday, Countrywide has been a casualty of a slowdown in property sales in the months after Brexit.
Today it said 2016 was a "year of two halves": in the first, the company benefited from strong sales, while punishing new stamp duty duty rules on buy-to-let homes which were introduced in April prompted a mad dash for property before the deadline.
But it said after the April deadline, stamp duty "suppressed the market". As, predictably, did the Brexit vote, to which it attributed a nine per cent year-on-year fall in transactions during the fourth quarter.
However, it added its mortgage broking business had benefited.
"Consumers showed an appetite for mitigating risks and the number of customers seeking to remortgage was up, with approvals up by 14 per cent compared to 2015, with the number of loans at its highest levels since 2009."
What Countrywide said
Chairman Peter Long said:
In 2016, political uncertainty and stamp duty changes had a significant impact on the UK property market, making it a challenging year for Countrywide. We faced into these challenges - making difficult decisions quickly and acting decisively, streamlining the cost base and transforming our customer offer. In addition we have, today, announced plans to reinforce our balance sheet giving us a strong platform, going into 2017, to accelerate our transformation agenda.
Brexit and stamp duty created a perfect storm for the UK's largest estate agent in 2016.