- The group expects its first half earnings to come in £20m lower than a year ago
- Countrywide now plan to raise fresh funds via equity investors
Shares in Countrywide have fallen by 25 per cent after the estate agent group issued a warning over its profits and vowed to raise fresh funds in a bid to cut its debts.
The property group admitted trading was ‘subdued’ in the first half, with transactions taking longer to be completed.
Countrywide, which owns a number of brands including Hamptons and Bridgfords, now expects its first half earnings to come in £20million lower than a year ago.
On the slide: Shares in Countrywide fell by 25% in early morning trading
The group’s share price fell by 25 per cent in early morning trading and is currently down 24.71 per cent or 19.40p to 59.10p.
In a trading update, Countrywide said: ‘The Company is now looking to put in place a long term capital structure to reduce its indebtedness and to support its turnaround plan and growth.
‘It is our intention to reduce the levels of debt by at least 50 per cent through additional equity finance.
The group’s major shareholder, Oaktree, and the company’s lenders are said to be ‘supportive of the plan’.
Countrywide said: ‘The market in the first half has continued to be subdued and we have experienced longer transaction cycles.
‘Our focus remains on building back the sales pipeline and we expect to substantially close the pipeline gap by the end of the year.’
Sluggish: Countrywide said trading had been ‘subdued’ across its portfolio
Back in January, the group’s former chief executive Alison Platt resigned after the company announced its annual profits would come in around 10 per cent lower than forecasted.
In March, Countrywide’s shares slumped after the group swung to an annual loss and warned over further pain to come this year.
At the time the group said it was going ‘back to basics’ after what it described as three years of under-performance in its main sales and lettings business.
Countrywide is axing around a third of its 450-strong central office team as part of cost-cutting efforts to help turn around its fortunes.