Purplebricks crisis as shares crash by a third
The value of shares in Purplebricks fell by more than a third after the stock markets opened.
More than £150 million was wiped off the company’s value after the estate agent disrupter scaled back its revenue targets owing to underperforming business in its key international markets of the United States and Australia.
US chief executive Eric Eckardt is to leave the company, with co-founder Michael Bruce – who owns 11 per cent of the business – taking over the running of the American division.
UK chief executive Lee Wainwright is also departing for “personal reasons”.
Reducing its revenue guidance for the current year by £35m, the Solihull-based group now expects to hit between £130m-£140m.
The company’s share price has fallen to £300m after reaching a high of £1.5 billion in July 2017.
“Although there are macro and industry headwinds across markets we are well-placed to capitalise on the significant opportunity for growth that exists in each country, albeit not entirely as we would have wanted before our year end,” said Bruce.
The company’s board expects to report UK revenue for the current financial year of approximately 15-20 per cent above the prior year and to maintain its 75 per cent share of UK online instructions.
“The UK is leading the way with continued profitable growth and a strategy to deliver greater success,” continued Bruce.
“I am also excited to be taking the reins of the US business. The team in Australia are building on the changes they implemented late last year and Canada is delivering on plan and expectations.
“The board remains confident of the long-term growth potential of the business and the opportunity to deliver substantial value for shareholders.”