Foxtons Group plc

Group revenue increased 5% to GBP 172.5 million, driven by 5% growth in Lettings revenue, 6% growth in sales revenue, and 10% growth in financial services revenue. Adjusted operating profit was GBP 22.2 million, flat year over year, and adjusted operating margin fell 60 basis points to 12.9%; adjusted EBITDA rose 5% to GBP 25.3 million. Statutory profit before tax was GBP 16.9 million, and net free cash flow increased 14% to GBP 11.2 million. Lettings revenue was GBP 111 million, sales revenue grew GBP 2.7 million to GBP 49.9 million, and financial services revenue was GBP 10.3 million. The board declared a final dividend of 0.93p per share, taking the full-year dividend to 1.17p per share, unchanged from the prior year. Net debt at 31 December was GBP 16.9 million, leverage was 0.7x versus a 1.75x covenant limit, and interest cover was 24x versus a 4x covenant. Looking ahead, management said 2026 should benefit from incremental revenues from the January 2026 acquisitions in Milton Keynes and Birmingham, GBP 1.5 million of annualized operating cost savings from the HQ move starting in January 2026, and continued focus on cost control; they also said they expect GBP 10 million of working capital investment across 2026 and 2027 as the lettings portfolio transitions to annual billing.

Guy Gittins emphasized that Foxtons is now firmly a Lettings-led business, with more than 32,000 tenancies and over two-thirds of group revenue coming from recurring lettings income. He framed the Renters' Rights Act as a significant structural opportunity, arguing that more compliance complexity should push landlords toward professional management and accelerate consolidation. His tone was confident but pragmatic: he acknowledged a volatile sales market and weak early-2026 demand, while still saying the group is targeting year-on-year revenue and profit growth in 2026.

Christopher Hough highlighted a 5% increase in revenue to GBP 172.5 million and 5% growth in adjusted EBITDA to GBP 25.3 million, but noted adjusted operating profit was flat at GBP 22.2 million because of employer national insurance, living wage increases, acquisition-related costs, and other overhead pressures. He pointed to improving cash generation, with net free cash flow up 14% to GBP 11.2 million, operating cash before working capital at GBP 36.4 million, and a planned GBP 10 million working-capital investment over 2026-2027 as billing terms shift to annual. He also stressed balance-sheet flexibility, citing net debt of GBP 16.9 million, leverage of 0.7x, an expanded GBP 40 million RCF extended to June 2028, and the 5.5 million shares repurchased in the year.

Analysts focused on how quickly the sales business can be repositioned, what the acquisition pace could look like for the rest of 2026, and how the Renters' Rights Act will affect working capital. Management said sales repositioning is an ongoing, data-led process that can be adjusted quickly, while acquisitions are opportunity-driven and the team wants to integrate Milton Keynes and Birmingham before pursuing more deals. On the RRA, management said the transition to annual billing should require about GBP 10 million of working-capital investment over 2026 and 2027, because billing periods will shorten as fixed-term tenancies disappear.