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Mortgage Advise Bureau ends year slightly ahead of forecasts

(Sharecast News) - Mortgage Advice Bureau said in an update on Thursday that, despite its caution over activity levels and its annual outlook expressed in September, actual trading in the fourth quarter surpassed expectations, leading it to anticipate reporting an adjusted profit before tax slightly ahead of current market consensus. The AIM-traded firm said that, despite UK Finance's estimate of a 28% reduction in gross new mortgage lending for 2023 compared to the prior year, amounting to £226bn, Mortgage Advice Bureau saw its revenue increase 4% to £239m.

It said the total number of advisers at year-end had decreased 4% to 2,158, with a 2% decline in the average number of mainstream advisers during the year.

The number of mainstream advisers at year-end was down 8% compared to the prior year.

It noted a strong underlying demand for home ownership and home moves, especially as fixed-rate mortgage costs reduced at the end of the prior year.

That resulted in increased purchase activity and refinancing, with mortgage volumes continuing to rise into January, significantly surpassing the volumes recorded in January 2023.

Despite ongoing uncertainty in the broader political and geopolitical landscape, current trading conditions were described as encouraging, positioning Mortgage Advice Bureau favourably to capitalise on market recovery and the expected resurgence in house purchase transactions.

While no organic adviser growth was assumed for the current year, the firm said it anticipated that some of its appointed representative (AR) firms could expedite recruitment efforts if the current positive momentum persisted.

That, the board said, could potentially lead to the company returning to previous levels of adviser growth by 2025.

Moreover, the addition of new AR firms remained robust, supported by technology enhancements, lead generation, and retention initiatives.

Throughout 2023, Mortgage Advice Bureau continued to invest in its proposition, aiming for a strong recovery and sustained market share growth in 2024 and beyond.

Current trading aligned with expectations, and reflected a positive outlook for the company.

"2023 was an exceptionally challenging year with consumer confidence heavily impacted, resulting in many customers deciding to delay their house purchase or refinancing," said chief executive officer Peter Brodnicki.

"Against this difficult backdrop I am very pleased with how MAB has significantly outperformed the market.

"To ensure we are in the best possible shape when market conditions improve, we have continued to invest across the entire group to drive lead flow and deliver optimal business and adviser efficiency.

"There is a great deal to be positive about, and our technology developments and lead initiatives, including the addition of Fluent, have broadened our addressable market and strengthened our growth plans."

At 1501 GMT, shares in Mortgage Advice Bureau were up 6.7% at 860p.

Reporting by Josh White for Sharecast.com.

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Important information: This information is not a personal recommendation for any particular investment. If you are unsure about the suitability of an investment you should speak to one of Fidelity’s advisers or an authorised financial adviser of your choice. When you are thinking about investing in shares, it’s generally a good idea to consider holding them alongside other investments in a diversified portfolio of assets. Past performance is not a reliable indicator of future returns.

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