March 10, 2020 / 8:17 AM / a month ago

Real estate agent LSL Property flags weaker demand on virus fears

FILE PHOTO: A man walks past houses painted in various colours in a residential street in London, Britain, May 15, 2019. REUTERS/Toby Melville/File Photo

(Reuters) - British real estate agent LSL Property Services (LSL.L) said on Tuesday it had seen slightly weaker demand in recent days due to the coronavirus outbreak, adding that the situation may pose difficulties for the business in 2020.

The company intends to propose a final dividend of 7.2 pence per share but said the payout would be kept under review ahead of its 2020 annual general meeting, usually held in late April, due to doubts about the outbreak’s impact.

LSL said it was keeping a close eye on the epidemic, which could hurt the company’s business in 2020 if buyers stay at home and avoid big purchases in an uncertain market.

However, market conditions so far in the year have been “encouraging”, LSL added.

The company also said talks with smaller rival Countrywide (CWD.L) about a possible all-share combination were ongoing. Countrywide has been trying to recover from a botched 2015 restructuring that led to four profit warnings and a deeply discounted share issue.

Britain’s property sector has seen deal activity improve since late last year, with Vistry (VTYV.L) buying Galliford Try’s (GFRD.L) residential units and mall operator Hammerson (HMSO.L) exiting its out-of-town retail locations.

Annual revenue fell 4% to 311.1 million pounds, due to closures of the company’s Your Move and Reeds Rains branches.

Adjusted core earnings rose 25% to 51.9 million pounds for the year ended Dec. 31, but pretax profit fell 31% to 16 million pounds.

Reporting by Tanishaa Nadkar in Bengaluru; Editing by Devika Syamnath

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