ULS performance still strong as stamp duty holiday winds down
By Josh White
Date: Tuesday 17 Aug 2021
(Sharecast News) - Conveyancing and property transaction technology company ULS said on Tuesday that it was still benefiting from a "buoyant" housing market, with trading during the first quarter further reflecting the "rapid" pick-up experienced during the second half of the last financial year.
The AIM-traded firm, which was holding its annual general meeting, said instructions and completions through its 'eConveyancer' platform had increased 58% and 43% respectively compared to the first quarter of the 2021 financial year, which was severely impacted by the onset of the Covid-19 pandemic.
It said June was a "particularly strong" month for completions, as the first stamp duty deadline was passed, with first quarter revenue and gross margin in line with the board's expectations at £5.2m and £2.1m, respectively.
"Importantly, the volume of transactions handled by DigitalMove continues to grow, now reaching around 55,000 instructions, highlighting the platform's growing standing in the home-moving sector," the board said in its statement.
The company said it still had a "strong" balance sheet, with net cash of more than £23m as at 30 June, as it was now debt free, while cash burn for the first quarter was below expectations.
"As a result, ULS remains well placed to invest in the DigitalMove platform as it focuses on enhancing the home moving process and driving scale."
The firm recently updated its strategy of building on the strong eConveyancer brand, established industry relationships with brokers, conveyancers, lenders and other industry stakeholders, and the early success of its 'DigitalMove' product.
Beyond added investment in growing eConveyancer, which was DigitalMove-enabled, the company said it was focussed on delivering the "best home moving and owning experience", looking through the consumer's lens in resolving the current friction-filled experience, while keeping stakeholders aware of the progress as the case progressed.
"Solving for the friction builds trust, which the company will further build on to help movers get settled and live in their homes.
"To deliver the strategy, the company recently announced a number of new senior hires as it accelerates its strategy with focus on delivering early revenue in the current financial year."
Looking ahead, ULS said instructions were expected to moderate during the summer, coinciding with the holiday season and the end of the stamp duty holiday.
"However, this is expected to be short-lived with improved conditions in autumn, reflecting an increase in remortgages as fixed deal periods come to an end and several lenders are now providing sub 1% products.
"The company is in a strong position to capitalise on this expected increase through its 'Rapid Remo' product."
At 1142 BST, shares in ULS Technology were up 1.35% at 75p.
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