MAB battles difficult property market to impress investors
Derby-based Mortgage Advice Bureau (MAB) has reported strong financial results for the first half of 2024, showing significant growth in adjusted profits despite the ongoing challenges in the mortgage market. The company's adjusted profit before tax (PBT) rose 39.9% to £12.3 million, compared to £8.8 million in the same period of 2023, while adjusted EBITDA increased by 31.3% to £13.8 million.
MAB's revenue for H1 2024 reached £123.9 million, reflecting a 5.4% increase from £117.5 million in H1 2023. Gross profit also saw a notable improvement, rising 14.5% to £37.7 million, with gross profit margins improving by 2.4 percentage points to 30.4%.
Despite this robust performance in adjusted metrics, the company's statutory profit before tax fell by 17.9% to £6.2 million, down from £7.6 million in H1 2023. Basic earnings per share (EPS) also dropped by 42.3%, while adjusted fully diluted EPS rose by 25.8%.
Peter Brodnicki (pictured), MAB's founder and Chief Executive, commented: "The first few months of 2024 started well as mortgage rates edged down ahead of expected base rate cuts and a more stable political outlook. When it became clear those cuts were not imminent, lenders adjusted their mortgage rates back up and the increased activity we saw started to tail off towards the end of Q1."
While re-financing and purchase activity remained subdued throughout the first half of the year, Brodnicki expressed optimism for the future: "Having now seen the first of a number of expected base rate cuts, activity levels are starting to gradually build again and we expect momentum to continue."
MAB says that a focus on technology and artificial intelligence continues to play a critical role in shaping the business for future growth. The company has made significant progress in lead generation, positioning itself for scalable growth and improving adviser productivity. Despite a slight decrease in the number of mainstream advisers in H1 2024, which fell by 0.7%, MAB has already seen adviser numbers increase since the end of the period.
Looking ahead, Brodnicki expects record levels of refinancing activity in 2025 and 2026, bolstered by a more favourable political and economic environment. "It is very encouraging to have a new government that is so focused on housebuilding and other initiatives that will bring a tailwind to MAB and our market," he noted.
Current Trading and Outlook
MAB has seen an 11% increase in new case numbers in July and August compared to the previous year, signalling a recovery in market activity. The company continues to trade in line with expectations, with the final quarter of 2024 anticipated to see further growth.
Brodnicki highlighted the potential for continued refinancing activity driven by recent and future Bank of England rate cuts, which he expects will foster a more dynamic mortgage market. "As expected, 2024 is shaping up to be a year of stability, following a highly challenging 2023," he said.
