Foxtons Group (FOXT) H2 2025 earnings summary

Executive summary

• Achieved 5% year-over-year revenue and adjusted EBITDA growth, driven by acquisitions, operational improvements in lettings, cross-selling, and financial services, despite flat adjusted operating profit amid a challenging market.

• Lettings now account for over two-thirds of group revenue, with a portfolio exceeding 32,000 tenancies and 67% of revenue from non-cyclical, recurring activities.

• Expanded market share as the largest lettings brand in the UK, supported by acquisitions and entry into new markets including Reading, Watford, Milton Keynes, and Birmingham.

• Continuous improvement initiatives included AI/data product upgrades, new marketing, and a refreshed people and culture framework.

• Flat operating profit due to cost headwinds and a volatile sales market, but profit growth has outpaced revenue growth over the last five years.

Financial highlights

• Revenue increased by 5% to £172.5m, with lettings up 5%, sales up 6%, and financial services up 10% year-over-year.

• Adjusted operating profit was £22.2m (flat year-over-year); adjusted EBITDA grew 5% to £25.3m.

• Statutory profit before tax was £16.9m, down 3%; adjusted EPS fell 4% to 5.0p; net free cash flow rose 14% to £11.2m.

• Final dividend of 0.93p per share, full-year dividend 1.17p per share (unchanged); 5.5m shares repurchased.

• Net debt at year-end was £16.9m; leverage ratio at 0.7x, well below covenant limits.

Outlook and guidance

• Expect continued strong tenant demand and stable stock in lettings for 2026, with RRA implementation creating growth opportunities.

• Two acquisitions in January 2026 to contribute incremental lettings revenue; focus on maximizing returns from recent acquisitions, organic growth, cost synergies, and targeted bolt-ons.

• Sales business to be repositioned for current market conditions, targeting revenue and profit growth through organic initiatives and acquisitions.

• Targeting year-on-year revenue and profit growth in 2026, underpinned by recurring lettings revenues.

• Ongoing transition to annualised billings to align with RRA, requiring £10m working capital investment by 2027.