Purplebricks lettings division losses to be revealed next week

The financial fall out from Purplebricks’ disastrous lettings compliance crisis is likely to be revealed next week.

The troubled agency says it will at last release its much-delayed full-year figures for its 2021-22 financial year on August 2.

Some eight months ago it was revealed that its lettings division had failed to safeguard tenant deposits - it has refused to disclose how many deposits were involved, nor for how long the agency was failing to safeguard them.

Back in January Purplebricks claimed it would cost the company some £3.6m to correct the compliance issues in its rentals division although media speculation had put the possible figure as being far higher, with one claim even being £30m.

Since then rumours have swirled, forcing Purplebricks to say at one point that it was going to keep its lettings division open, contrary to speculation of an imminent closure. 

Purplebricks’ share price has fallen some 85 per cent since it first listed on the London Stock Exchange’s AIM market in 2015 and there has been a series of profit warnings.

It has a controversial new chief executive, Helen Marston, whose appointment was delayed because of compliance checks on her past record, which includes an incident in 2014 when she voluntarily declared herself bankrupt, before this was discharged a year later.

Earlier this month investor Adam Smith, on behalf of Lecram Holdings - which has roughly a 4.2 per cent holding in Purplebricks - wrote to agency chairman Paul Pindar saying “urgent action is now essential to restore the credibility of the company with investors”.

Smith is a new investor - he got involved in Purplebricks in the spring - and if he succeeds in getting a five per cent stake he can request the board convene an extraordinary general meeting to discuss urgent matters.

His letter urged Pindar to step aside and allow a “replacement with necessary experience and skills to address urgently the company’s continuing cash burn and operating performance within the residential estate agency sector”.