LSL upgrades forecasts after strong first half

LSL Property Services has revealed strong trading in an unscheduled statement to the market ahead of its half-year results on 1 August.

The residential property services group said it expected to report interim figures ahead of the board’s expectations and significantly ahead of the same period last year. The group’s statement added its estate agency division delivered strong growth in lettings and financial services income, and with a strong performance by the surveying division. The results for the first half 2017 have also benefited from a small number of non-recurring items in comparison to the same period in 2016.

As a result, LSL’s board anticipates group underlying operating profit for the full year to be materially ahead of its prior expectations, with a more equal weighting between the first and second half compared to prior years.

The news went down well in the City as Chris Millington, an analyst at Numis Securities, upgraded his profit forecast for LSL in a BUY recommendation this morning.

Millington noted: “LSL’s unscheduled trading update suggests that half-year results will be significantly ahead of last year and management’s expectations. Accordingly, we are increasing 2017 and 2018 full year profit before tax estimates by 5% and 4% respectively and we forecast a more even first half/second half weighting to 2017 results than we have seen over recent years. This is the second profit upgrade we have made in under three months and we think that the risk to estimates remains on the upside.”

Millington increased the target share price for LSL to 276p. The shares leapt 11.5% by 9am this morning, to 252.91p.

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