The chairman of estate agency Purple Bricks should be removed following its “dreadful” annual results this morning, a key shareholder has said.
Lecram Holdings, which owns 4.2 per cent of the company, called for it to take action after disastrous losses and plummeting revenue for the last financial year.
Calling for chairman Paul Pindar to be removed, the comments comes after the tech-led housing group suffered due to a mixture of supply chain problems as a turbulent property market, and “a year of transformation”.
It registered a loss of £42m in the financial year up to April, down from a £6.8m profit in 2021, while its group revenue was down 23 per cent to £70m and its gross profit fell 27 per cent.
While its total fee income fell by 28 per cent and instructions were down over 30 per cent, its average revenue per instruction rose by four per cent. Purple Bricks announced adjusted EBITDA loss of £8.8m, which it says was driven by lower activity and a move t a new operating model.
Glenn Cooper, chair of Harrier Capital which advises on Lecram’s 4.2, per cent Purplebricks stake said: “The dreadful Purplebricks results show the extent of the challenge faced by the company.
“The leadership of Purplebricks has admitted to errors in its marketing, lettings, customer conversion, employment model and failed expansion into Germany, with the result that over £30m of shareholder funds were wasted in the last financial year.”
He added that while plans for a new CEO and CFO were in place, “we wonder why it has taken so long to act and are concerned that the lack of market experience at board level, and the fact that the chairman who presided over this terrible performance is still at the helm on the company.”
“We will be meeting the company later this month and will reiterate our call for a change of chairman, and our willingness to take action to bring about this change.”
Following the results, Helena Marston, CEO of Purple Bricks said the results were “significantly impacted by the challenges resulting from the implementation of our new operating model and investment in marketing that did not deliver the expected results”.
She said the poor performance coincided “alongside a housing market which played against us” but regardless, “our performance was not good enough.”
Setting out a plan for the future Marston said Purple Bricks would “expect to drive higher instructions, grow revenues, reset our cost base and raise standards”, with the firm already having “taken decisive action.”
Among measures are a cost reduction programme to make £13m in savings.
Purple Bricks has been asked for comment, as have other major stakeholders in the company.
The post Following ‘dreadful’ results shareholder calls for Purple Bricks chair to be removed appeared first on CityAM.
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