LSL Property Services has revealed it expects the group’s underlying operating profit for 2019 to come in “slightly ahead” of expectations, despite a 4% drop in revenue.

LSL said Marsh & Parsons delivered a resilient revenue performance during 2019.

The group, which incorporates estate agency, financial services and surveying businesses, added the revenue drop came following the restructuring of the Your Move and Reeds Rains branch networks announced since February last year. 

Excluding the impact of the planned closure of the Your Move and Reeds Rains branches, group revenue ended the year 4% up.

For the 12-month period, estate agency revenue was down by 16%, materially impacted by the planned reduction in the size of the Your Move and Reeds Rains branch networks during the first quarter of 2019. Excluding the impact of the closure of the Your Move and Reeds Rains branches, Estate Agency revenue for the year was down 4%. 

The group said: “Whilst London market conditions continued to be challenging during the year, Marsh & Parsons delivered a resilient revenue performance over the 12-month period with total revenue down 3%. Residential exchange income was down by 5% and Lettings income declined by 2%.”

The financial services division saw organic revenue growth of 1% year on year, excluding estate agency. Total Financial Services Division revenue, including estate agency, was down by 2%, reflecting the impact of the branch closures. Total appointed representative firms increased by 4% with a 3% increase in the number of financial advisers.

The surveying division delivered a revenue performance growth of 24% year on year, which included a material contribution from the successful commencement of the Lloyds Bank surveying and valuation services relationship.

At 31t December the group had net banking debt of £41.9m, up from £32.1m at the same point last year, which is a level of gearing the group said it was comfortable with.

Looking ahead, the group said: “Whilst it is too early in the year to give a view on the 2020 market outlook, the combination of increased political stability and a favourable LSL estate agency sales pipeline on 1 January 2020 compared to the LSL Board’s prior expectations provide a positive backdrop to the start of 2020.”

The group will publish its full-year results on 10 March 2020.