Huge losses revealed at Purplebricks after takeover
Online estate agency Purplebricks racked up huge losses in the year it was taken over by Strike, it has been revealed.
New accounts filed nine months after the Companies House deadline show the firm’s pre-tax losses went from £19.4m to £37.8m in the year to 31 March 2024.
Over the same period, its turnover rose from £13.2m to £31.1m.
Purplebricks’ accounts for its most recent financial year are due to be filed with Companies House by the end of December.
On why its accounts were filed so late, the company said: “Completion of the 2024 accounts has taken slightly longer than usual due to the additional work involved following the change of ownership.”
Purplebricks was taken over by Strike in June 2023 for £1.
Purplebricks blames interest rate rises
In a statement signed off by the board, the business said: “During the year, the business was subject to market uncertainties resulting from the three further interest rate rises and significant changes in policy imposed by legislative authorities which impacted performance in the year.
“The housing market slowed and mortgage lenders amended product offerings and further increased mortgage interest rates.
“In late 2023, following the transfers and the creation of a consolidated business, a review of the business structure and cost base was initiated.
“Post year end, the business and management have continued to refine the business model and review the cost base to best serve the products offered to customers.”
On its current trading, Purplebricks said: “The business continues to operate as an online estate agent, providing customers a fairer way to sell their house.
“Since the year end the group has continued to evolve its product offering to ensure customers save money, benefit from our expert estate agents and can choose a package and payment option to suit them.”
Stuart Bartlett, CEO of Purplebricks, said: “These accounts reflect historic challenges inherited by the new ownership following the acquisition of the business in May 2023.
“The new leadership team is fully committed to investing in the long-term success of Purplebricks.
“Significant improvements to our performance and operating model have already been made in the period following the reported accounts.
“While we recognise that a full financial turnaround takes time, we are confident in the direction the business is now heading.”
Panorama investigation
The accounts come after Purplebricks came under fire following a recent undercover investigation by BBC Panorama which claimed to have exposed ‘dubious sales tactics’.
The programme, which was broadcast in July, accused the estate agency of ‘trying to attract sellers by overvaluing properties’.
Panorama investigated the online estate agency Purplebricks after hearing concerns about its sales tactics.
In a statement released at the time, Purplebricks said: “We are extremely disappointed and concerned by the way Panorama has pursued this investigation.
“We provided detailed evidence to challenge many of the claims put to us – including full call recordings and correspondence – but they appear to have been ignored.”
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Speaking to CityAM‘s Boardroom Uncovered show last year, then-CEO Sam Mitchell branded the rental market “completely broken” and a “disaster for first-time buyers” unless they can rely on the bank of mum and dad.
Mitchell stepped down from his role in November 2024.