Guidance cut and CEO departure shocks Purplebricks investors

AIM-listed online estate agency Purplebricks (LON:PURP) cut its revenue guidance for the current financial year to £130-140 million, citing the failure of the US and Australian operations to meet expected revenue levels. The firm’s management maintained that the UK division would achieve 15-20% revenue growth and would maintain its dominant position in terms of its share of online instructions in the UK.

The company also revealed that the US and UK CEOs would be leaving in the near future. Co-founder Michael Bruce commented: “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. The UK is leading the way with continued profitable growth and a strategy to deliver greater success. 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“.

The price of Purplebricks shares plunged by 25.90% to 121.98p (as of 14:25 GMT).