Winkworth starts new year on front foot despite Covid-19 hit
M Winkworth reported a "strong" close to 2020 on Wednesday, despite the market upheaval caused by the Covid-19 pandemic, and said momentum had continued into the current year.
Updating on trading ahead of publishing results for the year to 31 December, the estate agent franchisor said it had benefited from a boom in the UK housing market after the first lockdown was relaxed.
"The second half of the year remained strong, not only as a result of catch-up, but also supported by a new category of buyers and sellers looking to change their lifestyles," it added.
As a result, Winkworth said that despite the disruption seen during the year, which included the UK housing market being shuttered for several months, 2020 revenues were broadly flat on 2019.
Pre-tax profits are expected to be lower year-on-year, however, and the total dividend payout has been reduced by 15%.
Looking to the current year, AIM-listed Winkworth noted that its estate agencies remained open, in line with the latest lockdown restrictions. "With our fourth-quarter sales applications up 44%, and lettings applications up 12% year-on-year, and with a record pipeline of sales still to feed through to trading in the first quarter of 2021, we have entered the current year with considerable momentum."
Chief executive Dominic Agace said: "We are pleased to have once again increased our market share and, not withstanding the latest lockdown, look forward to our company’s future with great confidence."
Alastair Stewart, analyst at Shore Capital, said the full-year dividend of 6.7p was "significantly" above previous expectations for around 6.0p.
"The company has not yet reinstated formal guidance, given uncertainty around the final timing of sales completions and lettings flow at the year end, and the outlook for the market entering 2021. However, with a strong pipeline and net cash, we believe Winkworth can at least equal the dividend in 2021, implying yield of at least 4.7%," he said.
Winkworth, which is due to publish final numbers in early April, is a house stock at Shore Capital.
As at 1045 GMT, shares in Winkworth were ahead 5% at 150.0p.