Slump in Countrywide profits adds to estate agency blues

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The Independent Online

Countrywide, Britain's largest estate agency business, suffered a steep fall in profits last year as the volume of transactions collapsed in the second half. The company warned yesterday that business this year was also below expectations.

Countrywide, Britain's largest estate agency business, suffered a steep fall in profits last year as the volume of transactions collapsed in the second half. The company warned yesterday that business this year was also below expectations.

The group said pre-tax profits dropped to £42.7m in 2004, compared with £74.2m the previous year. Christopher Sporborg, the chairman, said that after a "satisfactory" first half, Countrywide experienced "the most difficult trading conditions seen for many years". The impact of the slowdown was felt most in the final quarter.

The number of sales agreed in 2004 was 16 per cent below 2003 levels - within that, the second half was down 40 per cent. The company uses a number of different brand names across the country, including John D Wood and Faron Sutaria.

Given the poor market at the end of last year, the pipeline of business brought forward to 2005 was £16m lower than a year ago. However, the company said January and February 2005 "did show signs of increased activity".

Mr Sporborg said: "January started slowly as the UK gradually returned to work after an extended Christmas/new year holiday period. However, the second half of January saw a pick-up in activity in our house agency offices which has continued into February despite many parts of the country suffering inclement weather. While activity still falls below that seen at the same time last year ... the number of sales arranged per office in February was higher than at any time since July 2004 and, as a consequence we have seen a reasonable, improvement to our substantially depleted year-end pipelines."

Separately, Countrywide plans to place 8.46 million new shares, to raise about £30m to fund past acquisitions.

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