Purplebricks Group PLC (LON:PURP) (LSE:PURP.L) has released H1 results for the period to 31 October. Revenue has grown by 159% to £18.7 million, which already exceeds financial year 2016 sales of £18.6 million even though we are only halfway through the current year.
Local property expert growth has been 119%. Purplebricks has recruited 124 local property experts in H1 so that the total number now stands at 329. Its UK business has generated its first ever profit. Adjusted EBITDA of £0.3 million may be small, but it shows that Purplebricks is making progress.
Even though Brexit has caused a wobble in the property market, Purplebricks has been able to increase H1 instructions by 108%. Its average revenue per customer has increased by 20.6% to £1000 at the same time as Trustpilot reviews have risen to over 10580. Purplebricks has scored an ‘Excellent’ rating of 9.4/10.
Internationally, Purplebricks has launched a regional Australian business in Queensland and Victoria. In its first seven weeks of operation, it has delivered £0.57 million of instruction fees. In the UK, Purplebricks has sold and completed on nearly £2.6 billion of property in H1 2017 compared to £2.8 billion for the full 2016 financial year.
In 2016, Purplebricks has recorded a share price rise of 29%. That’s ahead of other property stocks such as Berkeley Group Holdings PLC (LON:BKG), Persimmon plc (LON:PSN), Taylor Wimpey plc (LON:TW) and Foxtons Group PLC (LON:FOXT). Berkeley has fallen by 24%, Persimmon is down 15%, Taylor Wimpey has slumped by 25% and Foxtons is down 46% in 2016.
In my view, Purplebricks has a good business model which should prove popular with vendors in future. While I am bullish on the property market in the long run, I feel that 2017 could be a tough year due mainly to the risks of Brexit. Therefore, although I think Purplebricks will perform well in the long run, I believe that 2017 could be a more difficult year.