Foxtons hails 'strong start' to 2021 but stays quiet on furlough

Oscar Williams-Grut
·Senior City Correspondent, Yahoo Finance UK
·2 min read
A Foxtons' 'To Let' estate agent board sign erected outside a property in London. (Photo by Dinendra Haria / SOPA Images/Sipa USA)
A Foxtons' 'To Let' estate agent board sign erected outside a property in London. Photo: Dinendra Haria/SOPA Images/Sipa USA/PA

London estate agency Foxtons (FOXT.L) has boasted of a "strong start" to the year but has remained quiet on the question of whether it will hand back millions of pound in taxpayer cash claimed through the furlough scheme.

Foxtons said in a trading update on Wednesday that it saw "strong revenue growth" in the first quarter of 2021. Income rose 24% to £28.5m ($39.3m), boosted by a 60% rise in sales revenues.

"I am delighted with the start we have made to the year, which is the best first quarter's trading in some time," chief executive Nic Budden said in a statement. "As we look forward, the strong trading momentum is expected to continue through the second quarter and together with tight cost control gives us confidence that operating profit for the first half will be significantly higher than last year."

Shares rose 1.5% in early trade in London.

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Foxtons shares jumped in early trade following the update. Photo: Yahoo Finance UK
Foxtons shares jumped in early trade following the update. Photo: Yahoo Finance UK

While bullish on the business' prospects, Budden made no mention of handing back government cash claimed under COVID-19 support schemes. Foxtons claimed £4.4m last year under the furlough scheme to cover employee wages. The business has gone on to buy rival estate agency Douglas & Gordon for £14.25m and last year launched a share buyback.

READ MORE: Foxtons under pressure to repay furlough cash

Foxtons has said it is under no obligation to pay back the money and said the support helped avoid layoffs as the UK's property market went into shutdown last year. The agency has pointed out that the cash was paid directly to staff, not the company.

Many other businesses have chosen to hand back cash voluntarily as a gesture of goodwill. Yahoo Finance UK has reported that 125,000 employers have now returned £700m in furlough grants. This week UK banknote maker De La Rue (DLAR.L) became the latest business to pledge to return furlough cash.

Foxtons on Wednesday said it had net cash of £22.3m in the business. The agency recently invested £3m into property website Boomin.

Darren Jones MP, chair of the Business Energy and Industrial Strategy Committee, has previously told Yahoo Finance UK that businesses like Foxtons should "act in good faith when using taxpayers' money during the pandemic". He urged the chancellor to "explore powers to claw back money when businesses see Covid related support as a commercial opportunity instead of a necessity during a national emergency."

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