Lsl Property Services Plc · LSE:LSL
Lsl Property Services — H1 2023 Earnings Presentation
21 slides from Lsl Property Services's earnings presentation, September 2023
Slide 1: Interim Results for six months ended 30 June 2023
Growth. Focus. Execution. Technology. People. Interim Results for six months ended 30 June 2023 1
Slide 2: Agenda
Agenda 01 Highlights 02 Financial and Operating Performance 03 Summary and Outlook 2
Slide 3: Highlights
Highlights LSL
Slide 4: Headlines
Headlines Short-Term Financial Performance Strategic Progress Impacted Investment in the Future and Market Well Positioned for Headwinds Future Recovery 4
Slide 5: Strong strategic progress
Strategic Progress Strong strategic progress Strategic Priority Progress Growth in FS Network ▪ Acquisition of TenetLime ▪ Franchising of Estate Agency Less Housing Market Cyclicality ▪ Focus of FS Division on B2B Lower Cost ▪ c.£140m Cost Savings in FY2024 ▪ Disposal of D2C FS Businesses and Group
Slide 6: A challenging environment
Market Headwinds A challenging environment Higher inflation impacting affordability Interest rates at highest levels since 2008 Contraction in UK housing transactions More product transfers in a smaller market 6
Slide 7: Financial performance reflects market headwinds, strategic transformation and continued investment
Short-Term Financial Financial performance reflects market headwinds, Performance Impacted strategic transformation and continued investment Group Underlying Group Revenue Operating Profit £72.5m (H1 2022: £110.2m) £4.3m (H1 2022: £14.7m) £14.2m Group Statutory Profit Net Cash Group Underlying Profi
Slide 8: Group well-positioned for recovery and future growth
Investment Group well-positioned for recovery and future in the Future growth Division Proposition Growth Drivers UK’s largest mortgage and Adviser growth Financial Services insurance network with 2,700+ Productivity growth Network Business advisers and further growth from New products and services
Slide 9: Financial and Operating Performance
Financial and Operating Performance 9
Slide 10: Significant strategic progress with resilient performance in difficult trading conditions
Significant strategic progress with resilient performance in difficult trading conditions Group ▪ Revenue -17% after adjusting for disposals and H1 Highlights (£m) 2023 2022 Var. franchising, in housing market -18% and purchase & remortgage market lending -27% Group Revenue 72.5 110.2 (34)% Group Un
Slide 11: Resilient FS performance with market share gains
Resilient FS performance with market share gains Financial Services ▪ ’ & l l w H1 Financial Services P&L (£m) 2023 2022 Var. market dynamics resulted in significant shift to Product FS Network Gross Revenue 134.2 146.1 (8)% Transfers (+48%) FS Network Net Revenue 19.6 20.5 (4)% ▪ Record total mortg
Slide 12: Surveying & Valuation performance impacted by market disruption whilst gaining market share
Surveying & Valuation performance impacted by market disruption whilst gaining market share Surveying & Valuation ▪ YoY performance impacted by increased volume of PTs, H1 S&V P&L (£m) 2023 2022 Var. which do not require a lender valuation, and impact of B2B – Valuations 33.7 48.6 (31)% higher inter
Slide 13: Conversion of all owned branches to franchisees
Conversion of all owned branches to franchisees results in L L becoming one of UK’s leading ro iders of estate agency franchise services Estate Agency ▪ Comparatives reflect franchising of the owned branch estate H1 Estate Agency P&L (£m) 2023 2022 Var. and the disposal of M&P Total Revenue 41.3 70.
Slide 14: Significant annualised cost reduction of c.£140m
Significant annualised cost reduction of c.£140m* through execution of strategic business restructure during H1 2023 Group ▪ Annualised cost reduction of c.£140m H1 cost run-rate reduced by c.£70m, annualised = £140m with significant savings already achieved during H1 and Estate Agency cost transfor
Slide 15: Strong Balance Sheet
Strong Balance Sheet Group ▪ Strong cash position provides flexibility Balance Sheet extracts (£m) 2023 2022 ▪ Banking facility renewed in February 2023, with maturity Net Cash 36.3 30.7 date of May 2026 (£60m RCF) Lapse Provision (Financial Services) 2.8 4.7 ▪ Contingent consideration (liabilities)
Slide 16: Record half year Net Cash position
Record half year Net Cash position Group 80 3.3 70 26.5 60 50 (13.6) (7.6) £m 40 40.1 (7.0) 30 (3.8) (1.6) 36.3 20 10 0 Net Cash Business Underlying WC, Depn, Dividends Paid Investments Exceptionals Capex Net Cash at 31 December disposals Operating etc. at 30 June Profit Highlights: ▪ £26.5m cash pr
Slide 17: Summary and Outlook
Summary and Outlook LSL
Slide 18: Summary
Summary Estate Agency Surveying & Valuation Division transformed remains profitable to create a higher and is positioned to margin business with benefit significantly higher cash from future market conversion that will recovery perform more consistently through market cycles Reduced annual cost Fina
Slide 19: Outlook
Outlook Market conditions Strong balance sheet expected to remain and cash position challenging with high allow us to invest interest rates and cost with confidence to of living challenges support future putting pressure on growth mortgage and housing markets LSL remains very well- Recent decision o
Slide 20: Questions
Questions LSL
Slide 21: Forward Looking Statements
FORWARD LOOKING STATEMENTS This document contains certain statements that are forward-looking statements. They appear in a number of places throughout this document and include statements regarding our intentions, beliefs or current expectations and those of our officers, directors and employees con
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