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Annual Report
and Accounts 2024
LSL PROPERTY SERVICES PLC
LSL Property Services plc Annual Report and Accounts 2024

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We are one of the largest
providers of services to the UK
property and mortgage market
across a range of different,
complementary areas. We seek
to deliver sustainable, resilient
and profitable growth through
B2B services to mortgage
intermediaries and estate
agent franchisees, valuation
services to lenders and home
surveys direct to consumers.
LSL Property Services plc
Company Number: 5114014
For further information about our Group,
please visit our website: lslps.co.uk
LSL PROPERTY SERVICES PLC ANNUAL REPORT AND ACCOUNTS 2024

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OTHER INFORMATIONFINANCIAL STATEMENTSCORPORATE GOVERNANCESTRATEGIC REPORTOVERVIEW
LSL PROPERTY SERVICES PLC ANNUAL REPORT AND ACCOUNTS 2024
01
Contents
STRATEGIC REPORT
02 Highlights
04 Business Model and Strategy
08 Chairs Statement
10 Group Chief Executive Officers Review
14 Financial and Divisional Reviews
26 Section 172 Statement and Stakeholder Engagement
34 Risk Management
39 Viability Statement
41 Sustainability Report
48 Non-Financial and Sustainability Information
49 TCFD and CFD Reporting
GOVERNANCE
60 The Board and Executive Team
64 Corporate Governance Report
72 Nominations Committee Report
77 Audit & Risk Committee Report
83 Directors’ Remuneration Report
99 Report of the Directors
103 Statement of Directors’ Responsibilities in Respect of
the Annual Report and Financial Statements
FINANCIAL STATEMENTS
104 Independent Auditor’s Report
113 Group Income Statement
114 Group Statement of Comprehensive Income
115 Group Balance Sheet
116 Group Statement of Cash Flows
117 Group Statement of Changes in Equity
118 Notes to the Group Financial Statements
163 Parent Company Balance Sheet
164 Parent Company Statement of Changes in Equity
166 Notes to the Parent Company Financial Statements
OTHER INFORMATION
172 Definitions
174 Shareholder Information
(including forward-looking
statements information)
Forward-looking statements
This Report may contain forward-looking statements with respect of certain plans, goals and
expectations relating to the future financial condition, business performance and results of LSL.
Further information about forward-looking statements can be found in the Shareholder Information
section on page 175.
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LSL PROPERTY SERVICES PLC ANNUAL REPORT AND ACCOUNTS 2024
02
Highlights
Group Underlying
Operating Profit
£27.7m
(2023: £10.3m)
Group Underlying
Operating Profit
Margin
16%
(2023: 7%)
Adjusted cash flow
from operations
£31.1m
(2023: £(0.2)m)
Our key highlights are:
Group Operating
Profit
£21.9m
(2023: £3.7m)
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LSL PROPERTY SERVICES PLC ANNUAL REPORT AND ACCOUNTS 2024
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OTHER INFORMATIONFINANCIAL STATEMENTSCORPORATE GOVERNANCESTRATEGIC REPORTOVERVIEW
Profit before tax
£23.0m
(2023: £4.9m)
Full year
dividend
11.4p
(2023: 11.4p)
Colleague
engagement survey
response rate
84%
(2023: 77%)
Group Revenue
£173.2m
(2023: £144.4m)
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LSL PROPERTY SERVICES PLC ANNUAL REPORT AND ACCOUNTS 2024
04
Our business model
Through a number of
key resources...
...we provide a range of first
class products and services...
...to our customers... ...for the benefit of all our
stakeholders...
Business Model and Strategy
Notes:
Unless stated otherwise, information in this section of the Report is as at 31 December 2024
Our purpose
To provide first class services to mortgage and
insurance advisers, Estate Agency franchisees,
lenders and their customers, to create long
term benefits for external stakeholders and
our people.
Our Section 172 Statement and Stakeholder
Engagement section on pages 26 to 33 explains
how our purpose impacts our stakeholders.
Key:
Group Financial Services
Surveying &
Valuation
Estate Agency
Franchising
Talented and
committed people
Leading technology
Group infrastructure
Group capital
Services to mortgage
intermediaries
Valuation and
surveys
Estate agency
franchising services
Mortgage and insurance
intermediaries
Lenders
Retail customers
Franchisees
Shareholders
Colleagues
Customers
Suppliers
Regulators
Communities and
Environment
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LSL PROPERTY SERVICES PLC ANNUAL REPORT AND ACCOUNTS 2024
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OTHER INFORMATIONFINANCIAL STATEMENTSCORPORATE GOVERNANCESTRATEGIC REPORTOVERVIEW
Our strategy
We are one of the largest providers of services
to the UK property and mortgage market
across a range of different, complementary
areas. We seek to deliver sustainable, resilient
and profitable growth through B2B services
to mortgage intermediaries and estate agent
franchisees, valuation services to lenders and
home surveys direct to consumers.
Our strategic objectives are to:
Enhance our market-leading positions in each of our three core
businesses.
Reduce earnings volatility and manage our exposure to mortgage
and housing market cycles.
Generate new and less cyclical revenue streams.
Create scalable platforms.
Enhance the productivity of our mortgage intermediary and estate
agency partners.
Focus on our Living Responsibly programme.
Retain, develop and attract talented people.
Financial
Services
One of the UK’s largest mortgage and insurance networks
The Division provides an extensive product panel, compliance and other services to over 2,700 advisers and
1,108 firms.
PRIMIS is one of the UK’s largest mortgage and insurance networks and together with the distribution introduced
by independent brokers to The Mortgage Alliance, TMA, the Division has a mortgage market share of one in nine
UK purchases and remortgages.
The Division also includes the Group’s joint venture investment, Pivotal Growth, established in 2021 with Pollen
Street Capital to execute a ‘buy and build' strategy of mortgage brokers. Since formation it has acquired 17 firms
and now has more than 500 mortgage advisers.
Surveying &
Valuation
One of the UK’s largest surveying and valuation businesses
The Division’s principal business is the provision of surveyor-led valuations to UK mortgage lenders. It also provides
a growing number of surveying and valuation services to consumers.
It is one of the UK’s biggest employers of Royal Institution of Chartered Surveyors (RICS) registered surveyors, with
469 (FTE) surveyors, and counts five of the top six UK lenders amongst its clients.
The Division includes e.surv as well as Walker Fraser Steele Chartered Surveyors, which services the Scottish
market.
The Division also manages the sale of residential properties on behalf of corporate clients and property investors
through its asset management businesses – LSL Corporate Client Department and Templeton LPA.
Estate
Agency
Franchising
One of the UK’s largest providers of estate agency franchise services
The Division’s principal business is the provision of franchising services, such as brand marketing and commercial
and IT support, to a network of 62 franchisees which operate over 310 territories across the UK.
These territories are independently managed and operated by the franchisees under various brands, including
Your Move and Reeds Rains, as well as several local brands.
This Division also provides a range of estate agency services to house builders, developers and investors of all
sizes through the LSL Land & New Homes business.
In addition, Homefast provides conveyancing panel management and support services to our franchisees and
their customers.
In order to fulfil this strategy, we deliver our services through three distinct business Divisions, each operated by its own Management Team. Each
Division is a leading player in the markets in which it operates. This scale, and their strong reputations, people and brands provide competitive
strength to the Group.
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LSL PROPERTY SERVICES PLC ANNUAL REPORT AND ACCOUNTS 2024
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Our values and culture
How we do things is as important as what we do. We have a clear set of values, across our three
Divisions, that define who we are.
Business Model and Strategy continued
Be people
focused
Deliver on
promises
Be market
leaders
Prioritise
teamwork
Be honest
Encourage
innovation
We work hard to embed these values in our
culture and strive to always improve. To live our
values, we want to have the right people, who
do the right thing, in the right way, by:
•  Accepting accountability for their actions.
•  Delivering and exceeding customer
expectations.
•  Being open, challenging themselves and
supporting others.
Our culture aligns with our purpose and
supports our strategy, including Living
Responsibly. Each Division is responsible for
developing and implementing plans to support
the delivery of the Group’s strategy and culture.
More information on how our culture is
embedded in our business can be found in our
Sustainability Report and Corporate Governance
Report.
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LSL PROPERTY SERVICES PLC ANNUAL REPORT AND ACCOUNTS 2024
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OTHER INFORMATIONFINANCIAL STATEMENTSCORPORATE GOVERNANCESTRATEGIC REPORTOVERVIEW
Our markets
Demand for the Group’s products and services is affected by the size and trends within the UK mortgage and housing
markets. The performance of the UK economy, consumer confidence, and interest rates influence all aspects of our
business. Additionally, specific factors affecting each of our individual business areas are outlined below.
Financial Services is mainly affected by:
Consumer buying trends including the use of intermediaries for
access to products.
The impact of regulatory changes.
Trends in home ownership and buy-to-let appetite.
Longer term demographic changes and population size.
Volume of refinancing activity.
Surveying & Valuation is mainly affected by:
Volume of house purchases using a mortgage product.
Volume of refinancing activity and the proportion of product
transfers vs remortgages.
Use of surveyor-led and data-driven valuations by lenders.
Use of surveying services by consumers.
Performance of specialist markets such as equity release.
Estate Agency Franchising is mainly affected by:
Volume of house sales.
Level of house prices.
Landlord appetite for lettings management services.
Government stimulus initiatives to drive demand or supply.
Notes and sources:
1 Approvals for lending secured on dwellings, Bank of England – Table A5.4 (30 January 2025)
2 New mortgage lending by purpose of loan, UK Finance (Bank of England) – Table MM23 (30 January 2025)
3 New residential lending sold direct and via intermediaries (excluding product transfers), UK Finance – Table RL8 (17 February 2025)
4 Number of residential property transaction completions with value £40,000 or above, HMRC (31 January 2025)
5 House price index, England and Wales, LSL Acadata (January 2025)
6 Index of Private Housing Rental Prices, UK, ONS (January 2025)
Market performance
Mortgage market
The markets in which we operate showed steady signs of recovery
during 2024, though overall activity has yet to return to the
average levels of recent years.
The UK mortgage market in 2024 has been a landscape of gradual
recovery and shifting dynamics, shaped by economic adjustments,
policy developments, and evolving consumer behaviour.
Total mortgage approvals for house purchases
1
were up 31% from
580,000 to 758,000 in 2024, with demand strong throughout the
year due to easing cost pressures, rising real wages, gradual cuts in
mortgage offer rates, and overall market resilience.
Total gross new mortgage lending
2
in 2024 was £242bn, 7%
higher than the prior year (2023: £226bn) with a significant swing
towards purchasing transactions/approvals. Purchase mortgages
accounted for 64% of total lending, up from 60% in 2023.
The proportion of mortgage lending placed through financial
advisers
3
remained flat at 84% (2023: 84%).
Remortgage (and other) approvals were up 8% on 2023, while
remortgages and other lending ended 5% below 2023, which
was driven by a few factors such as lower volumes of fixed
rate mortgage products ending in 2024 and ongoing economic
uncertainty leading to some consumers delaying refinancing
decisions until 2025 when rates are expected to be lower.
Housing market – residential sales and lettings
In 2024, the UK housing market saw a strong finish with
transactions up year-on-year, driven by competitive interest rates,
more homes on the market, and an impending Stamp Duty rise
in April 2025, leading to increased buyer demand and a positive
outlook for early 2025.
UK housing transactions
4
in 2024 were 1,101,000, up 8% (2023:
1,019,000).
Transactions year-on-year were up 1% in H1 2024 and up 14% in
H2 2024.
At the end of 2024, average house prices in England and Wales
5
were 2.0% lower than a year earlier (1.2% lower excluding
London).
Private rental prices paid by tenants in the UK
6
rose by 9.0% in the
12 months ended December 2024 (provisional estimate).
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LSL PROPERTY SERVICES PLC ANNUAL REPORT AND ACCOUNTS 2024
08
This is my first report to Shareholders as your
new Chair, having taken up my appointment
on 30 April 2024. My priority is to put in
place the building blocks to take us forward
as a better organised, accountable and
correctly incentivised public company where
the providers of financial capital are amply
rewarded for their backing and the providers
of human capital feel that their efforts are
rewarded.
Strong profit momentum against sluggish
market conditions
The Executive and Senior Leadership Team has delivered major
strategic progress during the last two years, with the radical
restructure of both the Financial Services Division and the Estate
Agency Franchising Division. These businesses, alongside our
Surveying & Valuation Division, are now business-to-business
platforms with strong market positions, tightly controlled costs, low
capital requirements and the potential for high cash generation.
While our 169% increase in underlying operating profit (statutory
operating profit +484%) is encouraging and has come from a
significant amount of hard work and dedication from the entire
business, the market has remained slow and below historic long-run
average activity levels. Housing transactions are 9% lower than the
10 year average and new mortgage lending is 6% below the 10 year
average. The Group is well placed to take advantage of increased
activity from any market recovery.
Balance sheet strength and dividend
The financial strength of the Group has been demonstrated
again during the year. The Group has made organic and inorganic
investments to position itself for further growth as well as provide
further funding to drive the long-term value of our Pivotal Growth
joint venture.
The Group is returning capital to Shareholders in two ways, via its
share buyback programme and a proposal to maintain the final
dividend at 7.4 pence per share, meaning a total dividend for the
year of 11.4 pence per share.
There has been a
significant amount of hard
work and dedication from
the business to achieve our
results in a slow market and
we are well placed to benefit
from any market recovery.
Adrian Collins
Chair
Chair's Statement
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LSL PROPERTY SERVICES PLC ANNUAL REPORT AND ACCOUNTS 2024
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OTHER INFORMATIONFINANCIAL STATEMENTSCORPORATE GOVERNANCESTRATEGIC REPORTOVERVIEW
Board changes
David Barral left the Board on 26 February 2024 and I was appointed
in his place as Chair on 30 April 2024 after a period of Darrell Evans
stepping up to fulfil the role on an interim basis. I am excited to
support the Group in the next phase of its evolution and have
enjoyed my engagement with our Shareholders and key stakeholders,
who have expressed their support for the Group.
Michael Stoop joined the Board on 24 June 2024. He brings a wealth
of experience in estate agency and franchising and has made a
valuable contribution to the Board since his appointment. He and
Darrell Evans took on additional responsibility in relation to the Estate
Agency Franchising Division and Surveying and Valuation Division
respectively on 30 January 2025 and their counsel and guidance on
those businesses is already adding value to the Group.
David Stewart will be retiring from the Board on 30 April 2025.
During his tenure as CEO he has led the transformation of LSL to a
higher margin, less capital-intensive business and the Board would
like to extend its thanks to him for his support over the past 10 years.
I am pleased that he will remain with the Group as a non-executive
director of the Group companies that form our Financial Services
Network and will continue as the Company’s representative on the
Boards of the companies within our joint venture with Pollen Street
Capital, Pivotal.
Adam Castleton will take over as CEO with effect from 1 May 2025.
I am delighted that he has taken up the baton and will become your
new CEO.
Looking forward
Market volumes remain below historic levels and consumer
confidence continues to be weak, with recent volatility in UK Gilts
and swap markets impacting mortgage rate costs. That said, the
Group is in a strong position across its three Divisions thanks to its
deep commercial relationships and well-known brands.
Our strong balance sheet provides the ability and confidence to
seize organic and inorganic growth opportunities for the Group. Each
Division has exciting future plans and the Board remains confident in
our long-term prospects.
Adrian Collins
Chair
25 March 2025
Group Underlying
Operating Profit
£27.7m
(2023: £10.3m)
Maintained
full year dividend
11.4p
(2023: 11.4p)
Group Operating
Profit
£21.9m
(2023: £3.7m)
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LSL PROPERTY SERVICES PLC ANNUAL REPORT AND ACCOUNTS 2024
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Group Chief Executive Officers Review
We have made positive progress through 2024,
delivering a substantial increase in profits, with
our full year results being just ahead of market
expectations, while continuing to reshape the
Group to deliver attractive, long-term returns in
line with our prudent risk appetite.
Each of our principal markets improved against the difficult conditions
experienced in 2023, although they remained muted with headwinds
persisting and activity levels below long-term averages. Against
this background, I am pleased to report that each of our principal
businesses increased or retained their strong market shares and
advanced key strategic initiatives that will help support future growth.
We have seen a clear step-up in the regulatory focus across many
financial services sectors, including some of the markets in which we
operate in. As a Group, we have always taken regulatory compliance
extremely seriously and over the last three years have added over
20 in additional headcount across our regulatory and compliance
functions. Furthermore, in 2024 we recruited a new Group Chief Risk
Officer and put in place an experienced Financial Services Division
board, including three independent non-executive directors to
provide further governance and regulatory oversight for this Division.
The Group will continue to monitor regulatory developments and is
committed to taking the steps needed to deliver against emerging
requirements.
Subsequent to the year end, we have made further enhancements
to our overall governance model, appointing two of the Group’s
Non-Executive Directors as chairs of the Surveying & Valuation
and Estate Agency Franchising Division. Darrell Evans will chair our
Surveying Division and Michael Stoop our Estate Agency Division. The
Financial Services Division already had in place an independent chair,
John Lowe.
We retain a very strong balance sheet and are well placed to take
advantage of any further market improvements while developing
a broader set of products and services designed to deliver more
consistent returns in all market conditions. Management continue
to focus on maximising the operational potential in each of our
businesses and on ensuring that this potential is fairly reflected in the
wider perceptions of our Group.
We are fortunate to have the support of highly committed colleagues
and I would like to place on record my appreciation for their support
and hard work throughout 2024.
Review of 2024 performance
The Group’s performance benefited from a recovery in demand and
further contract wins in our Surveying & Valuation business, as well
as the structural benefit afforded by the transformation programme
undertaken in 2023, transitioning to a franchise operating model in
our Estate Agency Franchising Division and focusing our activities on
business-to-business services in Financial Services. All three Divisions
have maintained or improved market share.
2024 was a year of positive
progress, as we built successfully on
the restructuring work completed in
2023. We were able to grow profits
materially, and at a faster rate than
we had anticipated at the start of the
year. Trading in the early months of the
new year is in line with expectations,
indicating we will be able to improve
performance again in 2025. I believe
the Group is now well positioned to
build on solid foundations and I am
sure that under the leadership of Adam
Castleton, who will take over as Group
CEO on 1 May, the Group will go from
strength to strength.
David Stewart
Group Chief Executive Officer
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LSL PROPERTY SERVICES PLC ANNUAL REPORT AND ACCOUNTS 2024
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OTHER INFORMATIONFINANCIAL STATEMENTSCORPORATE GOVERNANCESTRATEGIC REPORTOVERVIEW
We have made a number of targeted investments during 2024, both
organic and inorganic. Our organic investments will develop new
revenue opportunities, notably in Surveying & Valuation, while taking
pro-active steps to reshape and focus our Financial Services Division
on its core business of providing services to smaller mortgage-led
adviser businesses. This continues in 2025. Our inorganic investments
have focused on supporting bolt-on acquisitions by our franchisees
within our Estate Agency Franchising Division, creating increased
scale for our lettings business, and completing the purchase of the
TenetLime mortgage network in Financial Services.
Group Revenue increased 20% to £173.2m (2023: £144.4m) above
prior year in a total lending market that was broadly flat and housing
market that increased by 8%.
Group Underlying Operating Profit
1
recovered strongly to £27.7m
(2023: £10.3m), with a year-on-year increase in each Division. Group
Underlying Operating margin of 16% was its highest point in over
15 years, reflecting the return to high utilisation in Surveying and
the benefits of the franchising model in Estate Agency for the whole
period. On a statutory basis, Group Operating Profit was £21.9m
(2023: £3.7m).
Surveying & Valuation Division
Our Surveying & Valuation business has performed very well in
recent years, receiving increased allocations from existing customers
and winning new contracts. This continued in 2024, with notable
developments including the commencement of our renewed, long-
term, exclusive deal with Lloyds Banking Group and the renewal of
other contracts with major lenders.
These contract wins reinforced our leading market position and
helped drive a significant increase in activity as the market recovered,
resulting in an increase of more than three-fold in Underlying
Operating Profit
1
to £22.5m (2023: £6.7m). Underlying operating
margin also recovered strongly to 23.0% (2023: 9.4%), reflecting the
efficient use of surveyor time. Average jobs per surveyor was 1,040,
very substantially ahead of 2023 (782), when we decided to retain
excess capacity in anticipation of a market recovery and in line with
the strong utilisation achieved in 2021 and 2022. On a statutory
basis, Operating Profit was £22.1m (2023: £3.4m).
Surveying & Valuation Revenue increased by 36% to £97.8m. During
2024, we continued our work to develop new revenue streams, for
example from the provision of automated valuation and data services
to lenders, and increasing the number of valuation and surveying jobs
undertaken for the end customer. As mortgage lenders increasingly
make use of data and automated valuation services, we see further
opportunities to provide more services to the end customer.
Throughout 2024, and in particular in the second half of the year, we
invested significantly to develop these emerging revenue streams.
This investment included around £1m to support our data and
valuation work, including adding senior headcount in our data and
valuation modelling teams, whilst increasing our consumer and
marketing spend by £0.5m. This spend helped support an increase of
87% in our direct-to-consumer revenue, which reached £6.8m. This
represents a 500% increase in 4 years since 2020, when it stood at
£1.1m.
Group Revenue
£173.2m
(2023: £144.4m)
Group Underlying
Operating Margin
16%
(2023: 7%)
Cash Flow
Conversion Rate
114%
(2023: (2%))
Notes:
1 Group (and Divisional) Underlying Operating Profit is before exceptional items, contingent consideration assets & liabilities, amortisation of intangible assets and share-
based payments. Refer to note 5 to the Financial Statements for reconciliation of Group and Divisional Underlying Operating Profit to statutory operating profit/(loss)
for continuing, discontinued and total operations
2 Mortgage lending excluding product transfers - New mortgage lending by purpose of loan, UK Finance (Bank of England) – Table MM23 (30 January 2025)
3 Refer to note 12 to the Financial Statements for the calculation of Group Underlying Operating Profit after finance and normalised tax charges
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LSL PROPERTY SERVICES PLC ANNUAL REPORT AND ACCOUNTS 2024
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Financial Services Division
We have reinforced the leading position of our PRIMIS network in
the provision of services to independent mortgage brokers, aided by
the completion in February 2024 of the purchase of the TenetLime
network. At the end of the year, PRIMIS members totalled 2,282
advisers who sell mortgage and protection (2023: 2,068) and 421
advisers selling only protection and general insurance products (2023:
558), bringing the total number of advisers to 2,736 (2023: 2,661).
We were pleased with the contribution made by TenetLime advisers,
with the integration being completed on schedule and with both
financial performance and adviser retention in line with expectations.
This was despite the challenges that resulted from the placing into
administration of TenetLime’s seller, Tenet Group Limited, which had
contracted with us to provide transitional support services as part
of the terms of the transaction. As a result of this administration, we
had to take on additional work earlier than expected and incurred
additional costs to date of £0.5m as a result, which have been treated
as an exceptional cost. We expect to recover these, and any future
amounts, in 2025 from the deferred consideration balance of £3.3m.
The change in the split between mortgage and protection only
advisers reflects the work we have undertaken to develop a clear
focus for our future target market, as well as an assessment of the
relative risks of providing services in these segments. We incurred
exceptional costs of £1.9m associated with the exit of a large
protection only firm.
Total UK new mortgage lending increased slightly, by 7% to £242bn.
Our advisers total mortgage lending grew by 12% to £46.7bn,
reflecting an increase in market share in all key segments. We
increased our share of the purchase and remortgage and of the
product transfer markets, with a record share of purchase and
remortgage
2
(11.8%, up from 10.6%) and of product transfers (6.9%,
up from 6.1%). After adjusting for disposals, protection revenue
remained broadly flat.
The year also saw significant further steps taken to drive forward
our strategy focused on the mortgage-led adviser market. We
welcomed a number of senior appointments to the Divisional
management team, including experienced industry leaders as
Managing Director and Chief Distribution Officer, and in the early
part of 2025 will supplement the team further with the appointment
of a Chief Operating Officer. We have also completed the absorption
of our DLPS and Mortgage Gym technology businesses to focus
on supporting the growth of our Network business. Against this
background, we were pleased to report an increase in Underlying
Operating Profit
1
to £8.7m (2023: £7.4m). On a statutory basis,
Operating Profit was £4.7m (2023: £5.0m).
In December, we also announced a major programme of investment
to enhance the technology solutions provided to PRIMIS advisers to
improve efficiency and sales performance and underpin our leading
market position. We expect to spend around £3m by way of revenue
and capital expenditure in 2025 to support this programme.
Estate Agency Franchising Division
With the completion of the conversion of our Estate Agency business
to a franchise model during 2023, we are now focused on further
enhancing our franchising expertise to bring on new partners and
develop our services for franchisees.
The Group supported franchisees in the acquisition of three lettings
books in 2024, providing total loan funding of £0.7m and adding
c.700 properties to the portfolio which now stands at over 37,000.
These deals will deliver returns in excess of the Group’s cost of
capital. We see scope for further similar support in the future.
During 2024 the Estate Agency Franchising Division has invested in
strengthening leadership capability with key senior appointments
within propositions and operations, with these roles funded from its
cost reduction programme.
The strength of our new operating model in Estate Agency
Franchising was demonstrated by the strong financial performance
achieved in 2024. Divisional revenue was up 29% to £27.0m, with
Underlying Operating Profit
1
of £7.6m, an increase of 77% over the
prior year (2023: £4.3m), achieved at an underlying operating margin
of over 28% (2023: 21%). We are significantly ahead of the plans we
set in 2023 for reducing costs and increasing margin. On a statutory
basis, Operating Profit was £6.5m (2023: £3.0m).
Pivotal Growth joint venture
Pivotal Growth, our joint venture with Pollen Street Capital (PSC),
established to execute a buy-and-build strategy in the mortgage and
protection intermediary markets, was launched in 2021. Our joint
aim is to build the business together with a view to an exit event over
a three-to-six-year period after launch.
After a slow start, Pivotal has gained substantial momentum and has
now acquired 17 businesses, including eight acquisitions made in
2024. With over 500 advisers, Pivotal is now one of the UK’s largest
mortgage and protection brokers.
We have invested just over £20m in Pivotal since 2021 via equity and
loan notes, and we continue to closely monitor Pivotal’s performance
to maximise returns for Shareholders. Pivotal remains on track to
deliver returns ahead of the Group’s cost of capital.
Dividend
The improvement in performance in 2024 underpins the Board’s
confidence in the underlying fundamentals and prospects of the
Group's businesses. Therefore, the Board has declared a final
dividend of 7.4 pence per share (2023: 7.4 pence), making a total
dividend of 11.4 pence per share (2023: 11.4 pence). The Group’s
dividend policy continues to be a pay-out of 30% of Group Underlying
Operating Profit after finance and normalised tax charges
3
.
The ex-dividend date for the final dividend is 8 May 2025, with a
record date of 9 May 2025 and a payment date of 27 June 2025.
Group Chief Executive Officers Review continued
Notes:
1 Group (and Divisional) Underlying Operating Profit is before exceptional items, contingent consideration assets & liabilities, amortisation of intangible assets and share-
based payments. Refer to note 5 to the Financial Statements for reconciliation of Group and Divisional Underlying Operating Profit to statutory operating profit/(loss)
for continuing, discontinued and total operations
2 Mortgage lending excluding product transfers - New mortgage lending by purpose of loan, UK Finance (Bank of England) – Table MM23 (30 January 2025)
3 Refer to note 12 to the Financial Statements for the calculation of Group Underlying Operating Profit after finance and normalised tax charges
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LSL PROPERTY SERVICES PLC ANNUAL REPORT AND ACCOUNTS 2024
13
OTHER INFORMATIONFINANCIAL STATEMENTSCORPORATE GOVERNANCESTRATEGIC REPORTOVERVIEW
Shareholders can elect to reinvest their cash dividend and purchase
additional shares in LSL through a dividend reinvestment plan. The
election date is 23 May 2025.
Share buyback
The Board’s approach to capital allocation remains unchanged. We
will continue to deploy share buybacks in a measured way and there
are no plans to allocate cash reserved for the buyback into other
Group activities. To date, £1.3m of the share buyback programme
announced on 25 April 2024 has been deployed. The current buyback
programme has been extended to the date of the 2025 AGM.
Change of auditor
As highlighted in the 2024 Interim results announced in September
2024, an audit tender exercise had been concluded in advance of the
Group’s current auditors (Ernst & Young LLP (EY)) tenure reaching
its maximum term limit. This resulted in a recommendation from the
Audit & Risk Committee, which has now been endorsed by the Board,
that Grant Thornton UK LLP be appointed as the Group's auditor for
the year ending 31 December 2025.
Accordingly, it is our expectation that, following the completion of
the audit of the Group’s 2024 financial statements, EY will resign as
auditor of the Company creating a casual vacancy. In accordance with
the Companies Act 2006, Grant Thornton UK LLP will be appointed
by the Directors to fill that casual vacancy and to audit the financial
statements of the Group for the year ending 31 December 2025
and subsequent financial periods. EY will not therefore stand for
reappointment at the 2025 Annual General Meeting (AGM), and
a resolution to ratify Grant Thornton’s appointment will be put to
Shareholders for approval instead.
Appointment of Group Chief Executive Officer
Designate
As announced on 30 January 2025, Adam Castleton, previously
Group CFO, has been appointed as CEO Designate, following my
notification to the Board of my intention to retire from my Executive
role and the LSL Board.
Adam will formally take up the CEO position on 1 May 2025, following
a transition and handover period. The Nominations Committee has
agreed a process to identify and appoint a new CFO, and will make a
further announcement in due course. In addition, and subject to FCA
approval, I am pleased that I will remain with LSL as a non-executive
director of our Financial Services business and that I will also
continue as LSL's nominated director for Pivotal Growth.
Living Responsibly and ESG
In 2021 we established our ‘Living Responsibly’ programme focused
on creating a positive impact across the communities we serve. In
2024 we introduced paid volunteering days, which resulted in our
colleagues collectively contributing 534 days to support various
causes.
By listening and taking action, we further strengthened this
commitment through apprenticeships, improved colleague benefits
and learning and development opportunities. This was reflected in
our most recent colleague engagement survey with a record high
participation rate of 84%.
Addressing the impact we have on the environment remains central
to Living Responsibly, and during 2024 we have taken steps to better
understand this and our pathway to Net Zero 2040.
Reflecting on our progress affords us the time to look forward and
plan the next steps for Living Responsibly; at the start of 2025 we
welcomed in new colleagues across the Group, who will ensure our
Living Responsibly programme continues to have a positive impact
and aligns with the needs of all our stakeholders.
Current trading and outlook
We have made a positive start to the year with trading in line with
expectations. Our end markets have been operating broadly in line
with our assumptions.
We continue to expect the Group to deliver a further increase in
profits in 2025. The Board remain positive about the Group’s short
and medium-term prospects and fully supports the programme of
investment across each of its businesses to take advantage of the
value accretive growth opportunities ahead.
David Stewart
Group Chief Executive Officer
25 March 2025
Notes:
1 Group (and Divisional) Underlying Operating Profit is before exceptional items, contingent consideration assets & liabilities, amortisation of intangible assets and share-
based payments. Refer to note 5 to the Financial Statements for reconciliation of Group and Divisional Underlying Operating Profit to statutory operating profit/(loss)
for continuing, discontinued and total operations
2 Mortgage lending excluding product transfers - New mortgage lending by purpose of loan, UK Finance (Bank of England) – Table MM23 (30 January 2025)
3 Refer to note 12 to the Financial Statements for the calculation of Group Underlying Operating Profit after finance and normalised tax charges
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LSL PROPERTY SERVICES PLC ANNUAL REPORT AND ACCOUNTS 2024
14
Financial and Divisional Reviews
We report our results for the 12 months ended 31 December 2024
with Group Underlying Operating Profit
1,2
of £27.7m (2023: £10.3m).
On a statutory basis Group Operating Profit was £21.9m (2023:
£3.7m). These results demonstrate the benefits of the strategic
transformation by the Group over the last two years and are just
above consensus expectations and materially ahead of prior year.
We have made a positive start to the year with trading in line with
our expectations in markets operating broadly in line with our
assumptions. We continue to expect that in 2025 we will increase
profits further over 2024 and the Board's expectations for the full
year remain unchanged.
Key financial highlights
Full year financial metrics
1
2024 2023 Var
Revenue (£m) 173.2 144.4 20%
Group Underlying Operating Profit
2
(£m) 27.7 10.3 169%
Group Underlying Operating margin (%) 16% 7% +890bps
Group Underlying Operating Profit from total operations
2
(£m) 27.3 9.3 192%
Exceptional Gains (£m) 1.7 9.3 (81)%
Exceptional Costs (£m) (4.1) (13.8) 70%
Group operating profit (£m) 21.9 3.7 484%
Profit before tax (£m) 23.0 4.9 373%
Loss from discontinued operations
4
(£m) (0.4) (46.1) 99%
Basic Earnings per Share (pence) 17.3 7.9 119%
Adjusted Basic Earnings per Share
5
(pence) 21.1 7.6 178%
Net Cash
3
at 31 December (£m) 32.4 35.0 (7)%
Final dividend per share (pence) 7.4 7.4 -
Full year dividend per share (pence) 11.4 11.4 -
Financial Review
Notes:
1 Stated on basis of continuing operations unless otherwise stated. Following the conversion of the entire owned estate agency network to franchises in H1 2023, the
previously owned network was classified as a discontinued operation and is presented as such in the Financial Statements. Refer to note 6 to the Financial Statements
2 Group (and Divisional) Underlying Operating Profit is stated before exceptional items, contingent consideration assets & liabilities, amortisation of intangible assets and
share-based payments. Refer to note 5 to the Financial Statements for reconciliation of Group and Divisional Underlying Operating Profit to statutory operating profit/
(loss) for continuing, discontinued and total operations. FS Revenue of £48.4m in FY 2024, as compared to £47.0m in FY 2023 with statutory revenue of £51.7m less
£4.7m revenue from businesses disposed in 2023
3 Refer to note 34 to the Financial Statements
4 Following the conversion of the entire owned estate agency network to franchises in H1 2023, the previously owned network was classified as a discontinued operation
and is presented as such in the Financial Statements. Refer to note 6 to the Financial Statements
5 Refer to note 12 to the Financial Statements for the calculation
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LSL PROPERTY SERVICES PLC ANNUAL REPORT AND ACCOUNTS 2024
15
OTHER INFORMATIONFINANCIAL STATEMENTSCORPORATE GOVERNANCESTRATEGIC REPORTOVERVIEW
Group Income Statement Review
1
Group Revenue
Group Revenue increased 20% to £173.2m (2023: £144.4m). After
adjusting for disposals in 2023 and for the purchase of TenetLime
in H1 2024, revenue was 23%
2
above prior year in a total lending
market that was broadly flat and housing market that increased by
7%. The increase was primarily in the Surveying & Valuation Division
with a 36% increase compared to prior year, driven by 2023 contract
enhancements and a 21% increase in total BoE mortgage approvals,
and a 29% increase in Estate Agency Franchising due to 12 months’
trading in 2024 compared to only eight months in 2023 of the wholly
franchise model. After adjusting for businesses disposed of during
2023, Financial Services Division revenue was up 3%
2
, with total
Divisional revenue of £48.4m (2023: £47.0m).
Group Underlying Operating Profit
Group Underlying Operating Profit
3
recovered strongly to £27.7m
(2023: £10.3m), with a year-on-year increase in each Division. Group
Underlying Operating margin of 16% was the highest margin for
over 15 years, particularly reflecting high utilisation in Surveying &
Valuation and the benefits of the franchising model in Estate Agency
Franchising for the whole period. Group Underlying Operating Profit
from total operations was £27.3m (2023: £9.3m
4
).
Group Operating Profit
Group Operating Profit increased to £21.9m (2023: £3.7m), resulting
from the improved trading performance in the period, offset by
£2.4m net exceptional costs in 2024 (2023: £4.4m).
Adjusted Operating expenditure
Adjusted operating expenditure
5
comprises employee costs, other
operating costs, and depreciation and totalled £146.0m in 2024,
9% higher than prior year (2023: £133.5m), with the movement
comprising the net effect of the following factors:
Reduction of c.£7m due to disposed businesses during H1 2023.
After adjusting for disposed businesses, costs were £1.0m higher
in Financial Services in line with revenue.
Increased variable costs in Surveying & Valuation arising from 36%
increase in revenues.
The increased costs in Estate Agency Franchising reflect a full
year of franchise operations compared to the prior part year of
operations.
Central costs of £11.0m (2023: £7.7m) with the increase primarily
due to strategic investment, Board changes and additional audit
fees incurred in 2024 in respect of the prior period reflecting the
accounting treatment for the Group transformation in 2023.
This is broadly in line with expectations in comparison to the
historical operating expenditure levels of c.£280m
4
, and the targeted
annualised total operations cost reduction of c.£140m following the
restructuring of the Group in 2023.
Other gains
Total other operating gains were £0.5m (2023: losses of £0.2m).
This primarily included both a part sale of shares held in an unlisted
investment in H2 2024 (£0.1m) and the movement in the fair value of
the remaining holding, having been reassessed at 31 December 2024
as £0.4m (31 December 2023: £nil).
Share of losses from joint venture
Our equity shares of Pivotal Growth improved to broadly break-even
(2024: £6k loss, 2023: £0.4m loss), reflecting increased trading
EBITDA, before acquisition transaction fees, which more than
doubled in comparison to the prior period reflecting the benefit from
ongoing acquisitions.
Notes:
1 Based on continuing operations unless otherwise stated. Following the conversion of the entire owned Estate Agency network to franchisees in 2023, this was classified
as a discontinued operation and is now presented as such in the Financial Statements. Refer to note 6 to the Financial Statements
2 Revenue: £170.5m in FY 2024 with statutory revenue of £173.2m less £2.7m revenue due to acquisitions in 2024, as compared to £138.3m in FY 2023 with statutory
revenue of £144.4m less £6.1m revenue from businesses disposed in 2023. FS Revenue of £48.4m in FY 2024, as compared to £47.0m in FY 2023 with statutory revenue
of £51.7m less £4.7m revenue from businesses disposed in 2023
3 Group (and Divisional) Underlying Operating Profit is before exceptional items, contingent consideration assets & liabilities, amortisation of intangible assets and share-
based payments. Refer to note 5 to the Financial Statements for reconciliation of Group and Divisional Underlying Operating Profit to statutory operating profit/(loss)
for continuing, discontinued and total operations
4 Stated on total operations basis
5 Refer to note 34 to the Financial Statements
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LSL PROPERTY SERVICES PLC ANNUAL REPORT AND ACCOUNTS 2024
16
Share-based payments
The share-based payment charge of £0.9m in 2024 (2023: credit of
£0.2m) comprises, a charge in the period of £3.1m for LTIP, SAYE and
BAYE schemes granted in 2021 to 2024, offset by a credit of £2.2m
reflecting lapses and leavers. The prior year included a similar charge
of £3.0m, offset by higher lapse and leaver adjustments largely as
result of the significant restructuring across the Group in 2023.
Amortisation of intangible assets
1
Amortisation charge of £3.0m (2023: £2.3m), relates to amortisation
of intangible software investment, franchise agreements and
relationship assets. The year-on-year movement comprises mainly
of amortisation for the newly established franchise intangibles and
acquired TenetLime intangible assets offset by a reduction in both
lettings books and certain software intangibles as they have been
fully amortised.
Exceptional items
2
The exceptional gain of £1.7m in 2024 (2023: £9.3m) relates primarily
to the increase in contingent consideration receivable on the disposal
of RSC (£1.7m). The gain on disposal in 2023 related to the disposal
of the Embrace and First2Protect businesses to Pivotal Growth.
Exceptional costs of £4.1m in the period (2023: £13.8m), are
primarily due to the charge relating to the decrease in contingent
consideration receivable on the disposal of Group First and Embrace
Financial Services (£1.5m), Financial Services protection related
appointed representative costs (£1.9m) and costs incurred as a result
of the administration of TenetLime’s seller, Tenet Group Limited
(£0.5m). The prior year costs of £13.8m related to restructuring
activity and corporate transaction costs of £5.8m, the reduction in
deferred consideration receivable for businesses sold to Pivotal in H1
2023 (£4.1m), the net loss on disposals of Group First, RSC and Marsh
& Parsons of £1.7m, and intangible asset impairment (£2.2m).
Contingent consideration
Contingent consideration credit to the income statement of £0.4m
(2023: charge of £0.03m), relates to the reduction of the contingent
consideration liability for TenetLime, based on advisers retained.
Finance income/costs
Finance income remained in line with prior year at £2.9m (2023:
£2.8m) mainly from increased interest received of £1.8m on funds
held on deposit (2023: £1.5m) offset by the reduction in the unwind
of discounting on contingent consideration receivable balances of
£0.7m (2023: £1.0m).
Finance costs of £1.7m (2023: £1.7m) are related principally to the
unwinding of discount on lease liabilities of £0.5m (2023: £0.5m),
commitment and non-utilisation fees on the revolving credit facility
of £0.6m (2023: £0.7m), unwinding of discount on contingent
consideration payable of £0.1m (2023: £nil), fair value adjustment
to loans receivable of £0.3m (2023: £0.3m) and £0.2m for the
unwinding of discount on dilapidations provisions (2023: £0.1m).
Profit before tax
Profit before tax was £23.0m (2023: £4.9m). The year-on-year
movement is primarily due to the materially higher Group Underlying
Operating Profit in 2024, offset by net exceptional costs in 2024 of
£2.4m (2023: £4.4m).
Taxation
The tax charge of £5.2m (2023: credit of £3.2m) represents an
effective tax rate of 22.8% (2023: 65.2%), which is slightly lower than
the headline UK tax rate of 25.0% primarily because of a prior year
adjustment of £0.2m for overpayment relief claims. Deferred tax
assets and liabilities are measured at 25.0% (2023: 25.0%), the tax
rate that came into effect from 1 April 2023.
Discontinued operations
3
Discontinued operations loss of £0.4m (net of tax) in relation to an
increase in the restructuring and administrative costs associated with
the previously owned Estate Agency branch network (2023: loss of
£46.1m). The prior period reflects the discontinued operations in
Estate Agency Franchising which included exceptional restructuring
costs of £16.5m and write down of associated disposed goodwill
(£38.1m), offset in part by the exceptional gain on recognition of
intangible franchise agreements of £10.7m.
Earnings per share
4
2024 2023
Earnings per Share
(pence) Basic Diluted
Adjusted
basic
Adjusted
basic
diluted Basic Diluted
Adjusted
basic
Adjusted
basic
diluted
Continuing 17.3 17.1 7.9 7.8
Discontinued (0.4) (0.4) (44.7) (44.4)
Total operations 16.9 16.8 21.1 20.9 (36.9) (36.6) 7.6 7.5
Financial and Divisional Reviews continued
Financial Review continued
Notes:
1 Refer to note 2 and 17 to the Financial Statements
2 Refer to note 9 to the Financial Statements
3 Based on continuing operations unless otherwise stated. Following the conversion of the entire owned Estate Agency network to franchisees in 2023, this was classified
as a discontinued operation and is now presented as such in the Financial Statements. Refer to note 6 to the Financial Statements
4 Refer to note 12 to the Financial Statements
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LSL PROPERTY SERVICES PLC ANNUAL REPORT AND ACCOUNTS 2024
17
OTHER INFORMATIONFINANCIAL STATEMENTSCORPORATE GOVERNANCESTRATEGIC REPORTOVERVIEW
Goodwill - 31 December 2024: £16.9m
(31 December 2023: £16.9m)
The carrying value of Goodwill relates to previous acquisitions in
the Surveying & Valuation Division of £9.9m and Financial Services
Division of £7.0m.
Other intangible assets
1
- 31 December 2024: £29.9m
(31 December 2023: £21.5m)
Intangible relationship assets of £9.3m were recognised during the
period upon the purchase of TenetLime, with further additional
investments in Financial Services and Surveying of £2.1m. Total
amortisation of £3.0m was charged in the year (2023: £2.3m).
The carrying value of all franchise agreements was £10.9m at
31 December 2024 (31 December 2023: £11.7m), the acquired
relationship assets was £8.5m (2023: £nil) and software assets
of £3.6m (2023: £2.8m). Brand intangibles of £6.9m remained
unchanged during the year.
Property, plant and equipment (PPE) and right-of-use
assets (RoU assets)
2
-
31 December 2024: £6.4m
(31 December 2023: £6.9m)
Capital expenditure on owned PPE in the year amounted to £0.9m
(2023: £0.7m), primarily reflecting ongoing IT investment across all
divisions. Total depreciation of £1.2m was charged in the year (2023:
£1.7m).
Financial assets (total current and non-current) -
31 December 2024: £6.5m
(31 December 2023: £5.5m)
Contingent consideration receivable
31 December 2024: £5.8m (31 December 2023: £5.1m)
During H1 2023 the Group disposed of Group First, RSC and Embrace
B2C brokerage businesses to Pivotal Growth, with contingent
consideration receivable in the first half of 2025 based on 7x 2024
EBITDA performance. As at 31 December 2024, this asset is recorded
at £5.7m (31 December 2023: £4.8m).
The Group also has contingent consideration receivable in relation
to disposed lettings books, which are due to be fully repaid by
November 2025. As at 31 December 2024, this asset is recorded at
£0.1m (31 December 2023: £0.3m).
Equity instruments in unlisted companies
31 December 2024: £0.8m (31 December 2023: £0.4m)
There was no change in the fair value of units held in The Openwork
Partnership LLP of £0.4m at 31 December 2024 (31 December 2023:
£0.4m). The fair value has been reassessed as £0.4m at 31 December
2024, with our valuation based on an estimated strike price which
has been calculated using the strike price from most recently
executed trading windows.
The fair value of shares held in Twenty7tec Group Limited was
reassessed at 31 December 2024 as £0.4m (31 December 2023:
£nil). Part of the interest held in Twenty7tec was sold in H2 2024 for
consideration of £0.1m. Twenty7tec is a provider of technology to
mortgage advisers and lenders.
Loans to joint venture - 31 December 2024: £7.6m
(31 December 2023: £nil)
In December 2024, the Group provided funding of £7.6m to its joint
venture Pivotal Growth in the form of 10% unsecured loan notes.
The loan notes are redeemable in H1 2025 and no repayments were
made in 2024.
Investment in joint ventures - 31 December 2024: £11.6m
(31 December 2023: £9.4m)
Our 46.5% share of the Pivotal Growth joint venture is accounted for
using the equity method with the change in value resulting from our
equity investment in Pivotal Growth during the period (£2.2m), and
our share of profit after tax for the period (£6k loss).
Investment in sublease (total current and non-current) -
31 December 2024: £0.8m
(31 December 2023: £3.3m)
This reflects the situation whereby the Group is an intermediate
lessor, following the Estate Agency conversion to a wholly franchised
model. As part of the franchising transition, some of the leases held
by the Group in respect of the previously owned network have been
transferred to the franchisees, resulting in a reduction in both the
investment in sublease balance by £1.5m and a similar reduction in
IFRS 16 lease financial liabilities. The balancing movement reflects
payments made by franchisees during the period.
Group Balance Sheet Review
Notes:
1 Refer to note 2 and 17 to the Financial Statements
2 Refer to note 2 and 18 to the Financial Statements
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LSL PROPERTY SERVICES PLC ANNUAL REPORT AND ACCOUNTS 2024
18
Loans to franchisees and appointed representatives
(Network firms) - 31 December 2024: £1.8m
(31 December 2023: £2.1m)
Various sized working capital loan facility agreements are in place
with several franchisees of the Estate Agency Franchising Division
which have availability over a range of periods from 31 December
2024 to 31 December 2025, are repayable in full within 24 months
from the respective period end and bear fixed rate interest at 8.5%.
At 31 December 2024, £1.4m in principal loan amounts were drawn
down (31 December 2023: £0.8m).
Loans to FS appointed representatives are granted in certain
circumstances to support brokers upon joining the PRIMIS network
and were £0.5m as at 31 December 2024 (31 December 2023:
£1.3m).
Financial liabilities (total current and non-current) -
31 December 2024: £9.1m
(31 December 2023: £8.4m)
Contingent consideration liabilities -
31 December 2024: £3.3m
(31 December 2023: £0.07m)
Contingent consideration liabilities relate solely to the cost of
acquiring the intangible relationship assets in TenetLime in February
2024, with the consideration of £3.3m payable in H1 2025 adjusted
at 31 December 2024 for the latest update of retained advisers and
discounting.
IFRS 16 lease financial liabilities -
31 December 2024: £5.8m
(31 December 2023: £8.3m)
The movement in the period reflects payment of lease liabilities of
£3.4m and disposals on assignment to franchisees of £1.5m, offset
by new lease additions of £1.9m and unwinding of discounting of
£0.5m.
Provision for liabilities (total current and non-current) -
31 December 2024: £10.2m
(31 December 2023: £11.6m)
PI claim provisions of £2.3m (31 December 2023: £3.2m) include
the Surveying & Valuation PI provision of £1.9m (31 December
2023: £2.3m) and the Financial Services PI provision of £0.4m
(31 December 2023: £0.9m). The Group has recognised an asset of
£0.3m against received claims in other debtors at 31 December 2024
(31 December 2023: £0.6m).
Notes:
1 Refer to note 34 to the Financial Statements
Dilapidations and restructuring provisions relating to the Estate
Agency Franchising Division following the wholesale franchising in
2023, totalled £6.0m at 31 December 2024 (31 December 2023:
£7.8m). The movement in the year relates mainly to a release of
£1.5m in the dilapidations provision and £1.3m of payments made
relating to the restructuring provision.
A claims indemnity included in the sale agreement of LMS remains
unchanged at £0.6m at the period end (31 December 2023: £0.6m).
A provision of £1.2m has been recognised during the period
relating to one of the Group's former protection only appointed
representatives (2023: £nil).
Group Statement of Cash flows -
31 December 2024: Net Cash
1
£32.4m
(31 December 2023: Net Cash £35.0m)
Operating cashflows before movements in working capital were
£30.3m (2023: £14.9m) reflecting the higher underlying operating
profits generated in 2024. The business is highly cash generative and
ordinarily achieves a cash flow conversion rate
1
of 75% to 100%. The
ratio in 2024 was 114% reflecting the materially higher Underlying
Operating Profit, with a ratio of (2)% achieved in 2023.
Movements in working capital during the period were an inflow
of £2.7m (2023: outflow of £11.0m). The higher outflow in 2023
reflected the significant change in structure in the Group during that
year, especially in Estate Agency Franchising. The operating cycle
of working capital continues to settle following the completion of
significant restructuring and transformation programmes during
2023.
The movements in the year also included:
the initial consideration of £5.7m for the purchase of TenetLime
assets
a total of £9.8m investment into our joint venture Pivotal Growth
(£2.2m equity, £7.6m loan notes, 2023: £4.7m equity)
capital expenditure on PPE and intangibles of £3.0m (2023: £2.9m)
exceptional costs paid in relation to divisional restructure and
transformation programmes first executed in 2023 of £3.1m (2023:
£10.4m)
payment of the 2023 final and 2024 interim dividends of £11.8m
(2023: £11.7m) and the repurchase of shares under the share
buyback programme of £0.8m (2023: £nil)
corporation tax paid in 2024 of £1.8m as the Group returns to
more normalised taxable profits (2023: £nil)
Financial and Divisional Reviews continued
Group Balance Sheet Review continued
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LSL PROPERTY SERVICES PLC ANNUAL REPORT AND ACCOUNTS 2024
19
OTHER INFORMATIONFINANCIAL STATEMENTSCORPORATE GOVERNANCESTRATEGIC REPORTOVERVIEW
Bank facilities
In January 2025, LSL agreed an amendment and restatement of our
banking facility, with an unchanged £60m committed revolving credit
facility, and a maturity date of January 2030, which replaced the
previous £60m facility due to mature in May 2026. The terms of the
facility have remained materially the same as the previous facility. The
facility is provided by the same syndicate members as before, namely
Barclays Bank UK plc, NatWest Bank plc and Santander UK plc.
In arranging the banking facility, the Board took the opportunity to
review the Group’s borrowing requirements, considering our strong
cash position, our strategy and the Group’s capital allocation policy.
To provide further flexibility to support growth, the facility retains a
£30m accordion, to be requested by LSL at any time, subject to bank
approval.
International Accounting Standards (IAS)
The Financial Statements for the period ended 31 December 2024
have been prepared in accordance with international accounting
standards in conformity with the requirements of the Companies Act
2006 and UK-adopted IAS.
Graphics
Overview
Surveying revenue increased significantly to £92.5m, an increase
of 36% on 2023 (£67.8m), reflecting both the 26% increase in jobs
performed and the 8% increase in income per job on the comparative
period. The increase in jobs performed resulted in the market share
of valuation instructions increasing to c.38% in 2024 (2023: c.37%).
Growth in D2C in recent years has continued in the period, with 2024
revenue of £6.8m representing a 87% increase on 2023.
Surveying Underlying Operating Profit increased materially to £20.2m
(2023: £5.4m), benefiting from the strong revenue growth and the
surveyor capacity retention and self-help cost measures taken in
2023.
The Group’s asset management business was transferred from Estate
Agency Franchising to Surveying & Valuation following changes in
management responsibilities from 1 January 2024. Management
deemed the Group’s asset management operations, including the
class of customer for its services, are more closely aligned to the
Surveying & Valuation Division.
1
Asset Management revenues grew by 31% to £5.3m in the year,
reflecting the moderately more active market. However, the market
still remains below long-run trend levels. The profit for the year was
£2.3m (2023: £1.3m).
Total Surveying & Valuation Division revenue of £97.8m in the year
was an increase of £26.0m compared to 2023 (£71.9m). Underlying
Operating Profit
2
increased materially to £22.5m (2023: £6.7m)
reflecting the benefit of the revenue increases in both the e.surv and
asset management businesses. On a statutory basis, operating profit
was £22.1m (2023: £3.4m).
Financial summary
Notes:
1 Refer to note 4 to the Financial Statements
2 Divisional Underlying Operating Profit and Divisional Underlying Operating Margin are stated on the same basis as Group (as set out in note 5 to the Financial
Statements)
3 Full-time equivalent (FTE)
Financial Summary 2024
2023
(Restated)
1
Var
P&L (£m)
B2B – Valuations 85.7 64.1 34%
Private Surveys 6.8 3.6 87%
Other including Asset Management 5.4 4.2 29%
Total Revenue 97.8 71.9 36%
Underlying Operating Profit
2
22.5 6.7 234%
Underlying Operating Margin
2
23.0% 9.4% 1,360bps
Operating profit 22.1 3.4 550%
KPIs
Jobs performed (000’s) 491 389 26%
Remote Valuations as % of total 22% 23% (160)bps
Jobs per average surveyor 1,040 782 33%
Income per job (£) 188 174 8%
Operational surveyors employed (FTE
3
) 469 472 (1)%
Market Share 38% 37% 80bps
LSL PROPERTY SERVICES PLC ANNUAL REPORT AND ACCOUNTS 2024
20
Financial and Divisional Reviews continued
Surveying & Valuation Division
Graphics
Highlights
Surveying & Valuation performance was strong reflecting the
benefit of contract extensions with improved terms as well as
a recovery in market conditions from the significant reduction
experienced in 2023.
Surveying & Valuation revenue increased significantly to £97.8m,
an increase of 36% on 2023 (£71.9m), reflecting both the 26%
increase in jobs performed and the 8% increase in income per job
on the comparative period.
Mortgage approvals
4
were 21% above 2023, driven by higher
purchase approvals (up 31%) with remortgage and other approvals
8% higher.
We estimate that our market share of physical and remote
valuation instructions
4
was around 38% representing a small
increase over 2023 (c.37%).
Long-term contract extension with Lloyds Banking Group,
underpinning the Group’s leading market position. We also
secured a substantial improvement in terms and allocation with
another major lender.
Retained contracts with all lending customers with no loss in
allocations.
Underlying Operating Profit
5
increased to £22.5m (2023: £6.7m).
Good progress continues against strategic objectives to develop
new survey and valuation income from the end customer: B2C
revenue increased by 87% to £6.8m (2023: £3.6m), having grown
from £1.1m in 2020.
Substantial investment made throughout 2024, increasing in H2,
to support data and model development initiatives to diversify
future revenue streams and meet lender client needs.
On a statutory basis, operating profit was £22.1m (2023: £3.4m).
Notes:
4 Approvals for lending secured on dwellings, Bank of England – Table A5.4 (30 January 2025)
5 Divisional Underlying Operating Profit and Divisional Underlying Operating Margin are stated on the
same basis as Group (as set out in note 5 to the Financial Statements)
LSL PROPERTY SERVICES PLC ANNUAL REPORT AND ACCOUNTS 2024
21
OTHER INFORMATIONFINANCIAL STATEMENTSCORPORATE GOVERNANCESTRATEGIC REPORTOVERVIEW
Graphics
LSL PROPERTY SERVICES PLC ANNUAL REPORT AND ACCOUNTS 2024
22
Financial and Divisional Reviews continued
Financial Services Division
Overview
Our Financial Services Division is reported in two business lines:
our core Financial Services Network business comprising PRIMIS
and TMA mortgage club, and our share of profit after tax of Pivotal
Growth.
Total revenue was £48.4m (2023: £51.7m). After adjusting for
businesses disposed of during H1 2023, revenue was up 3%
1
. We
increased our share of the purchase and remortgage and of the
product transfer markets, with a record share of the purchase
and remortgage (11.8% up from 10.6%) and the product transfer
markets (6.9% up from 6.1%). After adjusting for disposals, Network
protection revenue was 4% lower than 2023.
Network Underlying Operating Profit
2
was £8.7m (2023: £7.4m),
which was marginally ahead of 2023 on an organic basis, in what
was a flat market, whilst also absorbing the cost of an extended
governance framework and restructuring costs.
Our share of losses after tax in our joint venture Pivotal Growth was
£0.0m (2023: loss of £0.4m). The trading EBITDA of Pivotal (before
transactional acquisition costs) was materially ahead of last year.
Exceptional costs of £2.4m were recognised primarily relating to the
exit of a large protection only firm (£1.9m) and costs associated with
the administration of the sellers of TenetLime (£0.5m).
Total Financial Services Division Underlying Operating Profit was
£8.7m (2023: £7.0m, £7.4m after adjusting for disposed businesses).
On a statutory basis, operating profit was £4.7m (2023: £5.0m).
The Financial Services Network business has a regulatory capital
requirement which represents 2.5% of its regulated revenues. The
regulatory capital requirement was £6.4m at 31 December 2024
(31 December 2023: £6.1m), with a surplus of £27.6m (31 December
2023: £24.7m).
Financial summary
2024 2023 Var
P&L (£m)
FS Network revenue 48.4 51.7 (6)%
FS Network Underlying Operating Profit 8.7 7.4 16%
FS Network Underlying Operating margin
2
17.9% 14.3% 350bps
Pivotal (share of JV PAT) (0.0) (0.4) 99%
Total FS Division Underlying Operating Profit
2
8.7 7.0 23%
Operating profit 4.7 5.0 (8)%
KPIs
Total AR firms 1,108 1,000 11%
Total advisers 2,736 2,661 3%
Mortgage Lending Market
3
(excl. PTs) (£bn) 242.0 225.5 7%
LSL Mortgage Lending
4
(£bn) 46.7 41.7 12%
LSL Purchase & Remortgage Lending (£bn) 28.5 23.9 19%
LSL Product Transfer Lending (£bn) 18.2 17.8 2%
Market Share (excl. PTs) 11.8% 10.6% 120bps
Notes:
1 FS Revenue of £48.4m in FY 2024, as compared to £47.0m in FY 2023 with statutory revenue of £51.7m less £4.7m revenue from businesses disposed in 2023
2 Divisional Underlying Operating Profit and Divisional Underlying Operating Margin are stated on the same basis as Group (as set out in note 5 to the Financial
Statements)
3 Mortgage lending excluding product transfers - new mortgage lending by purpose of loan, UK (BOE) – Table MM23 (February 2025)
4 LSL mortgage completion lending quoted includes product transfers
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LSL PROPERTY SERVICES PLC ANNUAL REPORT AND ACCOUNTS 2024
23
OTHER INFORMATIONFINANCIAL STATEMENTSCORPORATE GOVERNANCESTRATEGIC REPORTOVERVIEW
Highlights
Our Financial Services Network business increased its focus on its
core market, serving the needs of smaller, mortgage-led financial
services businesses, reflecting the strategic decision to reduce its
focus on larger, pure protection brokerages.
Successfully integrated 145 TenetLime firms with both profit
contribution and adviser retention in line with expectations.
Increased market share of the UK purchase and remortgage
market
5
of 11.8% (2023: 10.6%).
Total advisers increased by 75 to 2,736 as at 31 December 2024
(2023: 2,661) including 247 TenetLime advisers.
The number of advisers that sell both mortgages and protection
increased by 214 to 2,852. The number of protection only advisers
was reduced by 137, following the decision to exit some firms
whose business model was not in line with our risk appetite and
strategic focus.
LSL advisers continue to adapt effectively to changes in the
mortgage market, increasing product transfer mortgage lending
by 2%, resulting in a further increase in share of the product
transfer market to 6.9% (2023: 6.1%).
Financial Services Network business traded resiliently, reporting
Underlying Operating Profit
6
of £8.7m (2023: £7.4m).
The weighting of margin dilutive product transfers in the
refinancing market remained above the long-term average.
Network protection revenue remained broadly flat at £12.9m
after adjusting for disposals.
Total revenue of £48.4m was down 6% on the prior year as
reported (2023: £51.7m), reflecting the net impact of the disposal
of businesses in 2023 and the purchase of TenetLime in 2024.
The number of Network firms increased to 1,108 as at
31 December 2024 (2023: 1,000), including 145 TenetLime firms.
On a statutory basis, operating profit was £4.7m (2023: £5.0m).
Notes:
5 Mortgage lending excluding product transfers - new mortgage lending by purpose of loan,
UK (BOE) – Table MM23 (February 2025)
6 Divisional Underlying Operating Profit and Divisional Underlying Operating Margin are
stated on the same basis as Group (as set out in note 5 to the Financial Statements)
Graphics
LSL PROPERTY SERVICES PLC ANNUAL REPORT AND ACCOUNTS 2024
24
Overview
Estate Agency Franchising business revenue was £27.0m (2023:
£20.9m), with the increase primarily reflecting the wholesale
franchising of the Division only part way through H1 2023.
The Division continued to support the growth of its franchisees,
including the provision of loans to facilitate lettings acquisitions,
adding c.700 properties to the franchisee portfolios during 2024.
The average lettings income per managed property was up c.+2%
with total number of properties in line with the prior year
The Estate Agency Franchise business delivered a robust residential
sales performance, with the total number of exchange units 10%
above 2024 in a market which was 8% ahead
Underlying Operating Profit of £7.6m was delivered in 2024 (2023:
£4.3m) at a 28% operating margin (2023: 20%). On a statutory basis,
operating profit was £6.5m (2023: £3.0m).
Financial summary
Notes:
1 Refer to note 4 to the Financial Statements
2 Following the conversion of the entire owned estate agency network to franchises in H1 2023, this was classified as a discontinued operation and is now presented as
such in the Financial Statements. Refer to notes 2 and 6 to the Financial Statements
3 Divisional Underlying Operating Profit and Divisional Underlying Operating Margin are stated on the same basis as Group (as set out in note 5 to the Financial
Statements)
4 Number of residential property transaction completions with value £40,000 or above, HMRC (Jan 2025)
5 Excludes Marsh & Parsons disposed in January 2023
6 Territories quoted for 2023 is from the commencement of the wholly franchised Estate Agency business in May 2023
2024
2023
(Restated)
1
Var
P&L
2
(£m)
Continued operations 27.0 20.9 29%
Discontinued operations - 32.3 (100)%
Total revenue 27.0 53.2 (49)%
Continued operations 7.6 4.3 78%
Discontinued operations (0.4) (1.0) 100%
Underlying Operating Profit
3
7.2 3.3 129%
Underlying Operating Margin
3
26.4% 6.3% 2010bps
Operating profit from continuing operations 6.5 3.0 118%
Loss from discontinued operations (0.5) (45.3) 99%
Operating profit / (loss) from total operations 6.0 (42.3) 115%
Franchising Revenue 27.0 20.9 29%
Franchising Underlying Operating Profit 7.6 4.3 78%
Franchising Underlying Operating Margin 28.3% 20.6% 770bps
Franchise KPIs
HMRC Transactions (000’s)
4
1,101 1,019 8%
Exchange units
5
20,385 18,603 10%
Managed properties 37,462 37,502 -
Number of Territories
6
310 308 1%
Financial and Divisional Reviews continued
Estate Agency Franchising Division
Graphics
Notes:
7 Divisional Underlying Operating Profit and Divisional Underlying Operating Margin are stated on the
same basis as Group (as set out in note 5 to the Financial Statements)
LSL PROPERTY SERVICES PLC ANNUAL REPORT AND ACCOUNTS 2024
25
OTHER INFORMATIONFINANCIAL STATEMENTSCORPORATE GOVERNANCESTRATEGIC REPORTOVERVIEW
Highlights
Continued to support the growth of franchisees, including the
first loans granted to support lettings book acquisitions, adding
c.700 properties to the franchisee lettings portfolios.
Benefits of new business model are reflected in a substantial
increase in Underlying Operating Profit
7
of £7.6m (2023: £4.3m
8
)
with an underlying operating margin of 28%.
Scope remains for further cost efficiency gains within Estate
Agency business as the operating model approaches target state.
The number of properties under franchisees management
remained stable at 37,462 (31 December 2023: 37,502).
On a statutory basis, operating profit was £6.5m (2023: £3.0m).
Graphics
LSL PROPERTY SERVICES PLC ANNUAL REPORT AND ACCOUNTS 2024
26
Colleagues
Communities and
the Environment
Shareholders
Customers
Suppliers
Regulators
Section 172 Statement and
Stakeholder Engagement
The Directors have a responsibility, in accordance with Section 172 of the Companies Act 2006 (Section 172), to act in a way in which they consider,
in good faith, is most likely to promote the success of the Company and its members as a whole. In doing so, the Board takes into account the
interests of our stakeholders when decisions are made, considering the impact of those decisions on both the Company as a whole and its
individual stakeholders. In order to understand our stakeholder groups, we have various engagement methods.
Mortgage and insurance advisers,
lenders, Estate Agency franchisees
Our Stakeholders
Graphics
LSL PROPERTY SERVICES PLC ANNUAL REPORT AND ACCOUNTS 2024
27
OTHER INFORMATIONFINANCIAL STATEMENTSCORPORATE GOVERNANCESTRATEGIC REPORTOVERVIEW
Shareholders
Purpose Providing access to market-leading, growth orientated assets in the UK mortgage and
property market.
Why we engage The support of our Shareholders is crucial to our long-term success.
How we engage Members of the Board regularly meet with institutional Shareholders. The Executive
Directors will usually meet with such Shareholders and analysts after the release of our
full year and interim results or if a strategic initiative has been announced. We also offer
our major Shareholders the opportunity to meet with the Chair and other Non-Executive
Directors as required. Newly appointed Directors are offered the chance to meet with
significant Shareholders, particularly the Chair, Senior Independent Director and Executive
Directors, as part of their induction process. The Chairs of the various Board Committees are
also available to meet with major Shareholders to discuss relevant issues as appropriate.
Our AGM gives individual Shareholders the opportunity to engage with the Board, including
the Chairs of the Board and its Committees. The Board values the opportunity given by the
AGM to meet with Shareholders in person and hear their views. Separate resolutions are
proposed for each item of meeting business, with voting conducted by a poll. The Notice
of AGM is sent to Shareholders at least 20 working days ahead of the AGM. Email enquires
from Shareholders are also considered by the Executive Directors.
We publish a variety of information on our website (lslps.co.uk), including copies of
any Regulatory News Service announcements, our Financial Statements and our Living
Responsibly Report.
Any Shareholder wishing to engage with the Board should contact the Group Company
Secretary, whose details are included on page 174.
Board oversight The Board receives feedback on engagement with Shareholders from the Executive
Directors, the Chair, any other Non-Executive Director who has met with Shareholders and
our corporate advisers in order to consider Shareholder views when taking decisions.
2024 outcomes Members of the Board met with Investors following the departure of David Barral as Chair.
Darrell Evans and Adrian Collins met with a broad group of Shareholders following their
appointment as Interim Chair and Chair respectively. The Chair discussed, among other
things, Group strategy, governance arrangements and the rationale for a significant vote
against the re-election of Gaby Appleton at the 2024 AGM. As announced to the market on
13 December 2024, the Company believes that Gaby being in the role of SID while there
were governance concerns prompted this significant vote against. As explained further on
page 64, these issues have now been resolved.
The Chair, Group CEO and Group CFO had positive engagement with investors following the
announcement of David Stewarts retirement, the appointment of Adam Castleton as Group
CEO Designate and the introduction of non-executive chairs for our Surveying & Valuation
Division and Estate Agency Franchising Division.
Stakeholder Engagement
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LSL PROPERTY SERVICES PLC ANNUAL REPORT AND ACCOUNTS 2024
28
Section 172 Statement and
Stakeholder Engagement continued
Colleagues
Purpose Delivering an improving colleague experience through an increasingly diverse, inclusive
culture which puts colleague feedback at its heart.
Why we engage Our colleagues are critical to our desired culture and values and we recognise the
importance of ensuring our workforce is engaged, motivated and working in a safe
environment. We are committed to being a better place to work.
How we engage We engage with our colleagues via a number of channels, as summarised below:
Colleague surveys.
Our Group colleague forums, which include our Colleague Engagement Forum, the
Inclusion & Diversity Forum and the Communities Forum, and divisional colleague forums.
A Senior Management conference is held annually, with updates from the Group CEO,
Group CFO and the Divisional Managing Directors, alongside other topics of interest.
Webinars with Q&A sessions with the Group CEO and Group CFO.
Emails from the Group CEO and Divisional Managing Directors on business performance.
A regular newsletter which includes a round-up of news, interviews, celebrations and
updates from across the Group to which all colleagues are invited to contribute.
An annual “Speak Up” week where colleagues are encouraged to raise serious concerns in
confidence which operates alongside our Whistleblowing Policy.
Our Group intranet, The Hive.
We operate all-employee share schemes to provide a way for colleagues to acquire shares in
LSL which aligns their interests with our Shareholders.
Board oversight The results of colleague surveys are shared in detail with the Executive Committee, Divisional
Management Teams, our colleague forums and the Board. The colleague engagement
forums report regularly to the Group CEO and the Living Responsibility Steering Committee,
which report up to the Board and its Committees via our Group CPO.
Darrell Evans is our designated Non-Executive Director for workforce engagement
1
(Workforce NED). He regularly meets with the Colleague Engagement Forum and contributes
to Board discussions on colleague views. This is supplemented by reports to the Board
and Nominations Committee from our Group CPO on various metrics which demonstrate
patterns in our workforce.
2024 outcomes The 2024 colleague survey received an 84% response rate (2023: 77%), with an engagement
score of 73% (2023: 73%) and belief in action by management of 46% (2023: 41%). We are
delighted to have moved up 5 percentage points for our belief in management score against
the previous survey. Maintaining feedback loops at all levels is essential for sustaining this
trust.
Voluntary colleague turnover has reduced from 18.2% to 13.5% in 2024, with recruitment
growth outweighing voluntary attrition.
We were delighted to be awarded HR Team of the Year at the 2024 Business Awards UK.
More information on our colleague engagement initiatives and forums and the work done
in 2024 to improve colleagues’ health and wellbeing, pay and benefits is included in our
Sustainability Report on pages 41 to 47 together with details on our policy in relation to
human trafficking and modern slavery.
Notes:
1 Darrell Evans was appointed as Interim Chair from 5 March to 29 April 2024 and Gaby Appleton stepped into the role of Workforce NED during this period but did not
meet with the Colleague Engagement Forum
Stakeholder Engagement continued
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LSL PROPERTY SERVICES PLC ANNUAL REPORT AND ACCOUNTS 2024
29
OTHER INFORMATIONFINANCIAL STATEMENTSCORPORATE GOVERNANCESTRATEGIC REPORTOVERVIEW
Customers
Purpose Mortgage and insurance advisers: Providing technology, compliance, marketing and
business development services to help our customers grow their businesses through
delivering excellent customer service and ensuring good customer outcomes.
Lenders: Providing access to a national network of highly-skilled chartered surveyors and
using our market-leading knowledge of property risk to help customers make safe lending
decisions and deliver excellent customer service.
Estate Agency franchisees: Providing technology and business development services to help
customers safely grow their business and deliver good customer service.
Consumers: Providing direct-to-consumer surveys through our Surveying & Valuation
Division to help buyers gain insight and reassurance about their home purchase.
Why we engage Delivering high quality, consistent and continually evolving products and services is
important for customer satisfaction and retention, especially in the Financial Services
Network and Surveying & Valuation Division where we operate in a competitive market.
Our predominantly B2B service model means that, by delivering high quality services to our
customers, we also support the delivery of their services to their customers which in turn
generates revenue for the Group.
How we engage All Group businesses seek regular feedback from customers, which informs our decision
making and the development of our products and services. The Group’s key customers are:
Financial Services Network: mortgage and protection brokers, which are appointed
representatives and FCA authorised firms and their customers.
Surveying & Valuation: lenders for valuations and property data services and consumers for
private home condition surveys.
Estate Agency Franchising: franchisees.
Each division has arrangements in place to manage customer relations, which include:
Obtaining customer feedback through relationship management meetings, product and
service engagement meetings and other divisional specific engagement arrangements and
councils.
Attendance at events and conferences.
Formal questionnaires.
Mystery shopping exercises and focus groups.
Our Surveying & Valuation Division uses Trustpilot to gather feedback from consumers for
home surveys.
Board oversight Each division monitors KPIs and management information relating to its customer service,
including complaints information, adherence to agreed service levels for corporate clients
and Trustpilot scores where applicable. As part of regular and special business presentations
from each Division during the year, the Board receives reports on customer feedback and
results of consumer surveys.
Continued...
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LSL PROPERTY SERVICES PLC ANNUAL REPORT AND ACCOUNTS 2024
30
Customers
continued
2024 outcomes
Our Financial Services Division received the award for Best Network at both
the Mortgage Strategy Awards and the Financial Reporter Awards and the Best
Mortgage Club at the Mortgage Introducer Awards alongside various individual
colleagues receiving specific recognition in their fields. The Division has
undertaken a number of initiatives designed to improve the customer outcome,
including:
Improving technology with the introduction of a CRM in partnership with
Mortgage Brain and new telephony capability.
Reviewing compliance procedures to make it easier for our brokers to do
business and grow.
Invested in the sales and distribution teams alongside providing a package of
pre-approved marketing materials for brokers to use with their customers.
We have listened to feedback from our mortgage and protection brokers
regarding their expectations in relation to the technology we use and the Board
has approved significant investment into technology in the Financial Services
Division. More information on this Board decision is included on page 33.
Various brands within the Estate Agency Franchising Division won places in the
prestigious “Best Estate Agency Guide”, which is a guide highlighting the best
estate and lettings agents across the UK.
Our Surveying & Valuation Division successfully renewed four of its largest lender
contracts in 2024, including agreeing a new long-term contract with Lloyds
Banking Group. The Division has an excellent rating of 4.8 on Trustpilot for our
private home consumer surveys and a highly rated net promotor score of 58
1
from our lender clients for our valuation services.
Section 172 Statement and
Stakeholder Engagement continued
Notes:
1 Source: discussion with e.survs top 10 lending relationships
Stakeholder Engagement continued
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LSL PROPERTY SERVICES PLC ANNUAL REPORT AND ACCOUNTS 2024
31
OTHER INFORMATIONFINANCIAL STATEMENTSCORPORATE GOVERNANCESTRATEGIC REPORTOVERVIEW
Suppliers
Why we engage The performance of our key suppliers is important to our success. We expect them to
operate with an appropriate level of integrity and within applicable laws and regulations,
including the Modern Slavery Act 2015.
How we engage Key suppliers are managed through supplier management protocols, which include
reviews of contractual performance and other KPIs. Suppliers within e.surv are managed
via procurement and supplier policies which include commitments to ensure that our
purchasing and contracting activities are aligned with our values. These policies include a risk
rating process for suppliers by reference to their level of access to our data and systems and
the monitoring of suppliers’ performance and ongoing financial security.
More information on our payment practices to suppliers is included in our Sustainability
Report on page 47.
Board oversight The Board relies on Senior Management to manage the relationship with suppliers on a
day-to-day basis. Any significant new relationships are approved by the Board. Any concerns
about significant suppliers are escalated to the Board. Key supplier arrangements are
discussed as part of regular Divisional reporting to the Board.
2024 outcomes In our 2023 Section 172 Statement we reported that we would look to establish a Group-
wide supplier code as part of a supplier management framework which would encompass
the good practices already established within e.surv. This has not progressed as planned in
2024 and will be a focus for 2025.
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LSL PROPERTY SERVICES PLC ANNUAL REPORT AND ACCOUNTS 2024
32
Communities
and the
Environment
Why we engage We want to have a positive and lasting impact on the communities we work in and reduce
our impact on the environment.
How we engage Our Living Responsibly Steering Committee (SteerCo) is responsible for considering our
impact on our local communities, charitable considerations and the environment. Our
Sustainability Report on pages 41 to 47 and our separate Living Responsibly Report available
on our website (lslps.co.uk) provides more information on the work of the SteerCo.
Our Surveying & Valuation Division undertakes various sustainability initiatives in conjunction
with our lender clients in order to ensure compliance with contractual commitments and
mitigate against the risk of not achieving agreed supplier standards.
The Financial Services Network participates in the Mortgage Climate Action Group, which is
an industry-wide group focusing on education and collaboration in the Net Zero economy.
Board oversight The Board receives annual updates on the Group’s Sustainability Report and Living
Responsibly strategy and the initiatives undertaken by management.
2024 outcomes Our colleagues have been involved in various charitable initiatives during the year, as
detailed in the Living Responsibly Report.
We have continued to evolve our reporting on the Task Force on Climate-related Financial
Disclosures requirements which appear on pages 49 to 59.
Regulators
Why we engage Engaging with our regulators enables us to ensure we are compliant with regulations and
adapt our processes as changes to best practice operations are identified.
How we engage We seek to ensure that our interactions with the regulators of our various businesses (which
include the UKLA, HMRC, FRC, FCA, RICS, TPO and NTSEAT) are open and co-operative.
We ensure that we respond appropriately to any requests for information or guidance
received from our regulators.
Board oversight The Board and/or ARC receive regular updates from management on the Divisions’
compliance with their regulatory obligations and, in particular, any correspondence and
engagement on material matters with the FCA is notified to the Board.
2024 outcomes During the year our regulated subsidiaries have responded to a number of regulatory
consultations and guidance, and reviewed their operations where appropriate in response,
including:
Responding to the FCA product oversight and governance thematic review.
Preparing data to respond to an FCA market study into the provision of premium finance
for home and motor insurance.
Participating in phase 2 of the FCAs review of quality of mortgage advice study.
Section 172 Statement and
Stakeholder Engagement continued
Stakeholder Engagement continued
Graphics
Capital
allocation
policy
In response to Shareholder feedback, the Board decided to update its capital allocation
policy. This included the decision to appoint our broker to manage a non-discretionary
share buyback programme to repurchase ordinary shares up to a maximum consideration
of £7m in the 12 months ending 30 April 2025 on the terms as announced on 30 April
2024 in order to return excess capital to Shareholders, which instruction has been
extended until the 2025 AGM.
Financial
Services
CRM
The Board has supported considerable investment into the technology used by the
Financial Services Division via the procurement and implementation of enhanced
technology solutions provided to PRIMIS advisers. This will provide a foundation to provide
a modern technology solution for our customers and drive efficiency for our business.
Audit tender The Group’s current auditor, Ernst & Young LLP, was nearing its maximum term limit and
so a comprehensive formal tender process, overseen by the ARC, was conducted. In
accordance with a proposal from the ARC, the Board is recommending to Shareholders
that Grant Thornton UK LLP be appointed as the Group’s auditor for the year ending
December 2025.
Risk Having considered the risk environment in which the Group operates, the Board decided
to appoint a Group Chief Risk Officer (CRO) to provide input into the ARC on the risk and
control environment across the Group. The Divisional risk structure that has been in place
for a number of years will continue, with the Group CRO providing support and guidance to
those functions alongside providing relevant information to the ARC and Board to assist it
setting its risk appetite and the Group Risk Framework. This is an important step forward,
especially considering the risk on our business from the regulatory horizon and scrutiny of
financial services products.
Relocation
of registered
office
With the lease on our registered office in Newcastle due to expire, consideration was
given to refurbishing and staying at Newcastle House or seeking alternate office space.
Both the cost impact, environmental considerations and the needs of our colleagues were
considered and it was agreed to move to a new registered office with an EPC rating of A+
during 2025.
LSL PROPERTY SERVICES PLC ANNUAL REPORT AND ACCOUNTS 2024
33
OTHER INFORMATIONFINANCIAL STATEMENTSCORPORATE GOVERNANCESTRATEGIC REPORTOVERVIEW
Board decisions
Our Board is diverse in terms of skills, knowledge and experience which assists it in making informed decisions promoting the long-term success
of the Company whilst considering the needs of our stakeholders. More information on the Board is included on in the Directors’ biographies on
pages 60 and 61 and in our Corporate Governance Report and Nominations Committee Reports on pages 64 to 76.
The Board sets the Group strategy, values and culture which ensure that stakeholder considerations are considered when decisions are being made
across the business.
The key matters, and their impact on the Group’s stakeholders’ interests, considered by the Board and/or management during the year are set out
below. In making these decisions, the following Section 172 considerations were considered:
The likely consequences of any decisions in the long-term.
The interests of the Company’s employees.
The need to foster the Company’s business relationships with suppliers, customers and others.
The impact of the Company’s operations on the community and the environment.
The desirability of the Company maintaining a reputation for high standards of business conduct.
The need to act fairly as between members of the Company.
Further information on how these factors are considered is included in the Group’s Business Model and Strategy (pages 4 to 7), Risk Management
(pages 34 to 38) and Sustainability Report (pages 41 to 47), the Corporate Governance Report (pages 64 to 71) and our separate 2024 Living
Responsibly Report which is available on our website at lslps.co.uk.
The principal decisions during the year were:
Section 172 Statement
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LSL PROPERTY SERVICES PLC ANNUAL REPORT AND ACCOUNTS 2024
34
Risk Management
Our risk framework
Effective risk management is critical to delivering our purpose. We
adopt a prudent approach to risk management, taking only those
risks which support our strategy and managing them via a Board
approved risk framework and governance structure.
Our risk management processes ensure we appropriately manage
the risks that arise from our activities by:
A rigorous assessment of our principal risks and uncertainties,
including those that would threaten our business model or future
performance, or increase the potential for customer harm.
Robust decision-making, ensuring we take the right risks in a
considered way that supports the strategy and maintains our
reputation for high standards of business conduct.
Ensuring the risks we take are understood, controlled and
managed appropriately.
We have adopted a ’three lines of defence’ approach to risk
management:
First line - line management are accountable for day-to-day
operations and have responsibility for the management and
ownership of risks and controls within their business units.
Second line - risk and compliance teams are responsible for
the oversight and challenge of the first line in its day-to-day
management, control, monitoring, and reporting of risks. Our
risk and compliance teams are independent of the management
personnel responsible for originating risk exposures.
Third line - Internal Audit provides independent assurance to the
Board, Audit & Risk Committee and Senior Management over the
effectiveness of our risk management control and governance
processes.
As a regulated business, the Financial Services Division has a formal
governance framework. This includes an independent board, a board
compliance & audit committee and a board risk & customer outcomes
committee. The board comprises three independent non-executive
directors (iNEDs), one non-executive director (NED) and two executive
directors. The board is chaired by an iNED, with separate iNEDs
chairing each of the board committees.
In July 2024, we created a new role and appointed a Group Chief
Risk Officer (CRO) to further enhance risk oversight and foster a
consistent approach to risk management across the Group. This
includes investment in additional risk resource at a Group level and
also procurement of a governance risk & compliance (GRC) system
(Protecht) for roll out across the Group in 2025.
Each of our Divisions have risk management arrangements, systems
and controls which feed into the Group’s overall arrangements.
Divisional risk officers and risk committees oversee Divisional risk
management frameworks, which involve the use of risk metrics,
policies, risk control assessments, risk treatment plans and tracking of
emerging risks.
The Audit & Risk Committee oversees Divisional risk management
arrangements which includes Divisional top and emerging risks and
progress against various risk initiatives. The Committee also regularly
reviews the Group’s principal risks and uncertainties, including
confirming the effectiveness of risk management and internal control
systems, and considers emerging risks and the outputs of our stress
testing routines.
The Data & Information Security Committee provides oversight of
data protection and information security arrangements (including the
risk profile and control environment) across the Group by providing
review, challenge and recommendations on current and proposed
arrangements, including the policies which are included within the
Group's data and information security framework.
The Group scrutinises and challenges Divisional risk management
activities via the Group CRO's oversight, regular Internal Audit cycle
and through risk-based governance forums, attended by senior Group
and Divisional representatives.
Group Risk Governance Structure
Board
Audit & Risk Committee
Data & Information Security Committee
First Line Second Line Third Line
Divisional Risk Committees & Forums Group Chief Risk Officer
Internal Audit
Divisional Executive Risk Owners Divisional Risk Directors
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LSL PROPERTY SERVICES PLC ANNUAL REPORT AND ACCOUNTS 2024
35
OTHER INFORMATIONFINANCIAL STATEMENTSCORPORATE GOVERNANCESTRATEGIC REPORTOVERVIEW
Principal risks and uncertainties
The Board has assessed our principal risks, including emergent areas. The Board performs this exercise twice yearly as part of its agenda, having
considered the views of the Audit & Risk Committee, the Executive Directors, the Group CRO and the Head of Internal Audit.
Our principal risks and uncertainties are outlined below. These are the most significant risks that may adversely affect our business strategy,
financial position or future performance.
Following review in January 2025, there have been two changes to our individual principal risks and uncertainties. We have removed business
infrastructure (including technology) as this risk is now covered by market disruption, execution of strategy and information security (including data
protection and cyber threats) risks. We have added a new principal risk in relation to credit risk.
We consider our overall risk exposure to be stable, with increasing regulatory and information security risks being offset by reducing UK housing
market and execution strategy risks.
Nature of principal risk and uncertainty/context Mitigating actions Gross trend
1. UK housing and lending market: The cyclicality of the UK housing market and fluctuations in the lending market exposes the Group to
volatility in transaction volumes.
Inflation and affordability: high inflation and living costs
may reduce market transactions.
Mortgage finance: availability and affordability of
mortgage finance may impact demand.
Interest rates: increases in the base rate may affect
mortgage rates. Recent stability and falling rates may
boost market activity, despite Q4 inflation concerns.
Government policy: policy changes, like renters reform
or stamp duty may impact how our business operates.
Geopolitical risk: heightened market uncertainty may
affect bond and interest rates.
Three-year plan aligned to current challenges with
effective budgeting process and proactive sensitivity
analysis.
Strong capital and liquidity levels.
Strong discipline over capital allocation decisions and
scrutiny and challenge of discretionary spend.
Regular operating reviews enabling effective executive
oversight, governance and alignment of each Division.
Decreasing
2. Market disruption: We may be exposed to competitive pressures from market participants, including new entrants, disruptor business
models (including direct sales mediums), artificial intelligence platforms and disintermediation threats.
New entrants: strong competition in our markets
could impact our success at building scale across our
markets.
Artificial intelligence: the continued evolution of AI may
disrupt the markets in which we operate, for example
by enabling new entrants to compete with potentially
lower costs and more efficient processes.
Changing consumer behaviours could impact demand
for products and services across our businesses
and accelerate disintermediation (for example
next generation demanding direct sales channels,
preference for long-term mortgages).
Market monitoring: ongoing tracking of disruptor
activity and response plans.
Governance: support for new technology, service and
product initiatives.
Financial Services: technology transformation with
Mortgage Brain CRM and further enhancements in
2025. Launch of protection product quote service in Q3
and continued technology investment.
Surveying: development of data, modelling, and home
survey initiatives to enhance offerings.
Stable
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LSL PROPERTY SERVICES PLC ANNUAL REPORT AND ACCOUNTS 2024
36
Nature of principal risk and uncertainty/context Mitigating actions Gross trend
3. Execution of strategy: We might not effectively execute our strategic initiatives and associated capital allocations and therefore fail to
deliver the required level of Group growth.
Failure to adapt: not adapting to changing customer
behaviour, technological developments, regulatory
expectations, competition and cost management may
impact our business.
Strategic execution: may be limited by operational
capacity and regulatory complexity.
Costs: saving initiatives may not meet targets,
impacting business results, financial condition,
customer outcomes, prospects and reputation.
Failures could arise in obsolete technology and or
failures in deployment of new technology.
Regular strategy assessments by ExCo, Group CEO,
Group CFO and the Board.
Transformation programs aligned with business
strategy, prioritised in three-year planning and
budgeting.
Leadership-led governance for transformation
programs with clear accountabilities and milestones.
Strategy and transformation leadership reporting,
tracking benefits and aligning spend targets and value
outcomes.
Periodic reporting on key business and functional
initiatives to the Board and Audit & Risk Committee.
Decreasing
4. Professional services: We may receive claims arising from systemic lapses in the delivery of professional services across the Group.
Failure to meet legal or contractual obligations: could
lead to client actions/claims, negatively impacting
reputation, financial condition and business results.
For example:
Estate Agency Franchising Division: claims from
franchisees for unmet service expectations.
Financial Services Division: claims from customers for
inadequate advice or from brokers for inadequate
services or unpaid commissions.
Surveying & Valuation Division: claims from lenders
for property valuation accuracy.
Strong focus on service level delivery and relationship
management ensuring contractual obligations are met.
Surveying & Valuation and Financial Services: quality
assurance framework in place over adherence to
lender valuation requirements and broker activity
respectively.
Professional indemnity insurance to mitigate financial
exposure: established governance routines to monitor
claims trends and insurance arrangements.
Limiting exposure to high-risk products: for example,
the Financial Services Network does not supervise
investment advice.
Stable
5. Client contracts: Significant falls in business volume could arise from the loss or withdrawal of key B2B clients, brokers and/or franchisees.
Loss of market share: competition, changing customer
service propositions, pricing structures and alternative
business models may attract customers elsewhere.
Market capabilities: development of capabilities by B2B
clients, brokers, and franchisees may also see us lose
market share.
Our capabilities: not being able to provide effective
services, technology, or maintaining relationships could
impact market share.
Ongoing monitoring and renewal of key contracts.
Benchmarking of product and service propositions for
value delivery.
Surveying & Valuation: Long-term extension of a
contract with key client and renewal of a further two
client contracts with improved terms.
Rigorous oversight and service delivery via relationship
managers.
Monitoring the financial health of PRIMIS network
brokers and our Estate Agency franchisees.
Strategic investment in systems and technology.
Stable
Risk Management continued
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LSL PROPERTY SERVICES PLC ANNUAL REPORT AND ACCOUNTS 2024
37
OTHER INFORMATIONFINANCIAL STATEMENTSCORPORATE GOVERNANCESTRATEGIC REPORTOVERVIEW
Nature of principal risk and uncertainty/context Mitigating actions Gross trend
6. Information security (including data protection and cyber threats) and failure of global service providers: The threat of cyber-attacks
continues to increase globally.
Cyber attacks: the increasing sophistication and
frequency of cyber-attacks, along with global
uncertainties and geo-political tensions elevate
information security threats.
The threat landscape changes as we use data more
intelligently, introduce new technology, increase Cloud
use, and operate hybrid work models. Reliance on
third parties for services or data hosting adds risks (as
demonstrated by the 2024 CrowdStrike outage).
Reliance on third parties for services or data hosting:
this adds to our risk profile, as demonstrated by the
2024 CrowdStrike outage.
Continuous monitoring of cyber threats and investment
in our defences.
Oversight by the Data & Information Security
Committee (DISC), Divisional information security
specialists, and Data Protection Officers.
Group Minimum Standards in place with regular
Divisional attestations and audit cycle to ensure a
strong control environment.
System security through penetration testing, intrusion
scanning, secure backups, data encryption, and access
control.
Using data more intelligently, introducing new
technology, increasing Cloud use and operating hybrid
work models.
Ongoing training and education for vigilance.
Risk-based cyber-security assurance program.
Information security obligations in third-party contracts
with assurance programs.
Increasing
7. Regulatory compliance and responding to regulatory changes: We may fail to establish and maintain a robust compliance framework
and/or regulatory policies could develop in a manner that is detrimental to our business.
Our regulatory landscape includes FCA rules and
consumer protection laws.
Regulatory policies: externally imposed policies could
be detrimental to our business or develop in a way that
presents opportunities, that we fail to adapt to quickly
enough to benefit. Examples include:
In 2024, the FCA communicated several initiatives,
including market studies on pure protection product
distribution and premium finance, a continued focus
on appointed representative oversight and consumer
duty implementation.
The FCA are expected to issue further
communications on the court ruling regarding
undisclosed commission arrangements.
The BoE recently published report has highlighted
the effect of brokers on banks' business models and
highlighted broker prioritisation of short-term fixed
mortgages.
Furthermore, timelines for passing the Renters
Reform Act will increase landlord costs by enhancing
renter protections and establishing a landlord
ombudsman.
Financial Services Division: independent governance
via board/board committees with iNEDs, including the
chair.
Compliance teams in place across all Divisions.
Active engagement with regulatory bodies to ensure
we maintain high standards of business and deliver
good outcomes for our customers.
We identify, track and review the impact of regulatory
change through our internal control processes, with
material updates being considered at the Divisional
risk committees, the Audit & Risk Committee and the
Board.
Structured initiatives are in place to identify and
deliver relevant regulatory changes promptly and
proportionately.
We actively engage with regulatory bodies to ensure
we maintain high standards of business and deliver
good outcomes for our customers.
Increasing
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LSL PROPERTY SERVICES PLC ANNUAL REPORT AND ACCOUNTS 2024
38
Nature of principal risk and uncertainty / Context Mitigating actions Gross trend
8. Environmental, social and governance (ESG)
Failure to identify and effectively manage
sustainability risks could affect our productivity,
reputation, colleague engagement and retention
and/or market value.
The Group’s operations have environmental
implications. The Group faces risks related to
carbon emissions, energy consumption, and waste
management.
Living Responsibly ESG programme: promotes diversity,
inclusion, communities, environmental responsibility
and governance.
Leadership: Group CEO sponsors ESG programme;
Group CPO and Group Head of ESG supports Group
and Divisional arrangements.
Sustainability Report: annual publication ensures
transparency and stakeholder engagement.
Colleague engagement: through forums, working
groups, surveys and training.
Climate risk policy: our framework for considering
climate-related risks.
Emissions reduction: targets set to reduce emissions
and plans for Net Zero transition.
Stable
9. Colleague resources, talent and expertise: Successful strategy delivery depends on attracting and retaining highly qualified professionals.
Colleague retention: successful strategy delivery
depends on attracting and retaining highly qualified
professionals. Risks include key personnel or
expertise teams leaving, impacting our business.
Focus on digitalisation: this may increase
competition for technology and digital skills meaning
we are unable to employ appropriate resource.
Group governance, policies, and initiatives overseen
by the Remuneration Committee and Nominations
Committee to recruit and retain key talent.
Colleague surveys, forums, and welfare initiatives to
identify and address pressures, promoting an open
culture.
Colleague training, development programs,
remuneration strategies, and succession planning to
avoid key personnel dependencies.
Active identification and development of talent,
highlighting values and social purpose, promoting our
Group as a great place to work.
Stable
10. Credit risk: Exposures from contingent liabilities (commission clawback) where broker firms become insolvent.
The nature of protection business is such that
Insurers pay advance commission which is subject to
clawback should the customer cancel their insurance
policy in the indemnity period. As a result, where a
broker firm becomes insolvent, we remain liable for
any future clawbacks.
All new firms are subject to strict due diligence and
financial health checks prior to onboarding to the
network.
Ongoing monitoring of financial health of firms with
established intervention, support and escalation
controls.
Stable
Risk Management continued
Graphics
a severe downturn in our markets, where:
housing transactions decrease by an average of 26%
versus 2024, which is 6% below the level seen during the last
recession in 2008, caused by:
economic conditions (such as high inflation and interest rates
and reduced availability of debt funding);
political or other uncertainties; or
a combination of these issues.
the loss of a major contract
such as the loss of a top five lender, which has not occurred for
over five years.
a Professional Indemnity risk event
resulting in a significant increase in valuation claims for our
Surveying & Valuation Division.
a material one-off regulatory fine or redress expense
LSL PROPERTY SERVICES PLC ANNUAL REPORT AND ACCOUNTS 2024
39
OTHER INFORMATIONFINANCIAL STATEMENTSCORPORATE GOVERNANCESTRATEGIC REPORTOVERVIEW
Viability Statement
The Directors have assessed the Group’s prospects and financial viability, taking into account its current
and expected financial position, existing banking facilities, actions available to management and the
potential impact of its principal risks and uncertainties.
Assessment of prospects
The Board assesses the Group’s prospects throughout the year and
particularly during the strategic, three-year planning and budget
processes. This includes an annual review of our plans, which is
led by the Group CEO and Group CFO, with input from Executive
Committee members who run our Group functions and the Divisional
Managing Directors.
The Directors participate in the annual planning processes. Part of
the Board’s role is to consider whether our plans take appropriate
account of the changing environment, including macroeconomic,
political and geopolitical, regulatory, technological and climate-
related matters.
This process results in the Board adopting strategic objectives and
detailed financial forecasts over a three-year period, which we refer
to as the three-year plan. The Board reviewed the latest updates to
the three-year plan in December 2024 and, in assessing the Group’s
viability, considered our current position and our prospects of
operating over the three-year period ending 31 December 2027.
Our business model and strategy are described on pages 4 to 7.
Assessment of viability
For the purposes of assessing the Group’s viability, we have
determined that a three-year period is appropriate as it is consistent
with the Board’s strategic planning cycle. Our assessment takes into
account the Group’s current position and prospects, the Group’s
principal risks and uncertainties the risk management arrangements
in place.
To make this assessment, we considered several severe but plausible
scenarios that stress test our business performance. The scenarios
modelled (as shown below) are based on input from a functional
group of senior managers, including representatives from the
Divisional finance teams. The Group’s base forecast and scenarios
assume all three Divisions continue to operate.
The viability scenario modelled reflected the following risks in aggregate:
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LSL PROPERTY SERVICES PLC ANNUAL REPORT AND ACCOUNTS 2024
40
Detailed assumptions by month were modelled across the three-year
period, including both the individual and aggregate impacts of the
risks, the downside impact on revenue and the actions we would
take to retain cash reserves and maintain our operations, such as
suspending capital expenditure. We also considered climate-related
impacts and our current assessment is that these would not be
material enough to impact our viability over the next three years.
We also made assumptions about the stability and potential growth
of the Group’s recurring income and counter-cyclical businesses,
notably mortgage and insurance renewals, lettings (via our Estate
Agency franchisees) and asset management, which account for
c.30% of Group Revenue. We considered the extent to which we
could quickly ramp up some activities, such as remote valuations,
to mitigate against extreme market conditions. The modelling and
assumptions took account of our broad range of services across
the UK, which gives us some protection from the impact of stress
scenarios.
The stress testing indicated that the Group would be able to
withstand the financial and operational impact of each scenario and
therefore continue to operate and meet its liabilities, as they fall due,
over the three-year period ending 31 December 2027. Under all the
modelled scenarios, the Group had sufficient liquidity throughout
the going concern period and to the end of the viability period to
December 2027. Group funding has been further strengthened by
the extension of the Group’s £60m banking facility to January 2030.
We also modelled significantly more severe reverse stress scenarios,
to assess the level to which market conditions would have to
deteriorate before we would breach our banking covenant ratio of
2.75x Net Debt: adjusted EBITDA (with a ratio of 3.00x allowable for
two consecutive test periods during the renewal period). Excluding
any action we would take to retain cash reserves and maintain
our operations, the modelling indicated that UK housing market
transaction activity would have to fall to a level c.10% below the
financial crisis of 2008 in the first year of assessment with no material
recovery, which is equivalent to a 26% fall in comparison to 2024. We
consider the likelihood of this to be remote.
During 2024, the Audit & Risk Committee oversaw the process
by which the Directors reviewed and discussed managements
assessment of the Group’s ongoing viability.
Based on their assessment of the Group’s prospects and viability,
the Directors confirm that they have a reasonable expectation that
the Group will continue to operate and meet its liabilities, as they
fall due, for the next three years, and that the likelihood of extreme
scenarios which would lead to a breach of banking covenants is
remote.
The Directors also confirm that in making this statement they
carried out an assessment of the principal and emerging risks and
uncertainties facing the Group, including those that would threaten
its business model, future performance, solvency or liquidity.
Viability Statement continued
Graphics
PEOPLE
Our colleagues are the foundation of our success, and we recognise their dedication, expertise, and
contribution in driving our business forward. We remain committed to fostering a supportive and safe
workplace, that enables them to thrive, innovate, and deliver sustainable growth.
We are pleased to see a continued reduction in our colleague turnover in 2024:
31 December 2024 31 December 2023
2
31 December 2022 31 December 2021
Total colleagues 1,802 1,724 4,452 4,617
Total voluntary
turnover (%)
13.5 18.2 30.5 28.1
Male (%)
1
49% 47% 47% 47%
Female (%)
1
51% 53% 53% 53%
The right people, doing the right things, in the right way
PEOPLE COMMUNITY ENVIRONMENT GOVERNANCE
Programme component
Responsible with our
people
Responsible with our
communities
Responsible with our
environment
Responsible in the way
we work
We are
committed to…
…being a better place
to work.
…supporting colleague
initiatives and giving
back.
…reducing our impact
on the environment.
…excellent governance.
Why? People are our
greatest asset and
central to securing our
sustainability.
We want to have a
positive and lasting
impact on the
communities we
work in.
We have a
responsibility to do this
as a global citizen and
our stakeholders are
keen for us to play our
part.
Our customers depend
on our excellent
governance to support
them in their business
operations.
Executive
Committee
sponsor
Debra Gardner,
Chief People Officer
Saad Hassanuddin,
Group Chief Risk
Officer
Saad Hassanuddin,
Group Chief Risk
Officer
Debbie Fish,
Group Company
Secretary
LSL PROPERTY SERVICES PLC ANNUAL REPORT AND ACCOUNTS 2024
41
OTHER INFORMATIONFINANCIAL STATEMENTSCORPORATE GOVERNANCESTRATEGIC REPORTOVERVIEW
Introduction
We deliver our Environmental, Social and Governance (ESG) initiatives through our Living Responsibly programme. We include a summary of
key information within this report, with more detailed information on our initiatives (particularly in relation to our people and our communities)
included in our Living Responsibly Report on our website lslps.co.uk.
We have continued to deliver our Living Responsibly programme throughout 2024, led by the Group CEO and supported by our Living Responsibly
Steering Committee (SteerCo) and our Head of ESG.
Our sustainability strategy
Our Group culture is at the heart of our Living Responsibly strategy, as evidenced below:
Notes:
1 Percentage of total voluntary turnover made up of male or female colleagues
2 Headcount reduction between 2022 and 2023 results from a move to a franchise model
Sustainability Report
We are still seeing slightly more movement among females and will continue to monitor this, including reviewing for any differences in experience
highlighted in our annual colleague survey. Analysis of data to date suggests that females are more engaged than males within the Group.
Graphics
Forum Examples of feedback and discussions
LSL
Colleague
Engagement
The CEF is a collaborative forum made up
of elected colleague representatives where
colleague-related issues are raised by both our
Group CPO and forum members.
Darrell Evans, our designated Non-Executive
Director for workforce engagement, regularly
attends the CEF to receive direct feedback.
The CEF raised the issue of holiday entitlement
and long-service holiday awards. In response, all
colleagues now receive at least 25 days holiday
entitlement, with long serving colleagues receiving
an additional entitlement of up to five days each
year.
Members of the forum participated in a tender for
a new Employee Assistance Programme provider.
This benefit offers colleagues and their immediate
families a safe space to confidentially discuss
personal or professional challenges they may be
facing.
Forum Examples of feedback and discussion
LSL
Inclusion
& Diversity
The I&D Forum (previously LSL Voices) is focused
on delivering events and communications
around I&D initiatives through the year.
The I&D Forum is currently contributing to the
simplification of our colleague policies.
Forum Examples of feedback and discussion
LSL
Communities
The Communities Forum champions
opportunities for colleagues to support
communities and charities.
In response to feedback from the Communities
Forum, the annual paid volunteering day for all
colleagues was secured.
LSL PROPERTY SERVICES PLC ANNUAL REPORT AND ACCOUNTS 2024
42
Colleague dialogue
We have three Group-wide colleague forums to support our colleague engagement, all of which report up to our Living Responsibly Steerco and
our Group HR Team.
Our forums are:
Sustainability Report continued
Graphics
Key:
Favourable 
Neutral 
Unfavourable
LSL PROPERTY SERVICES PLC ANNUAL REPORT AND ACCOUNTS 2024
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OTHER INFORMATIONFINANCIAL STATEMENTSCORPORATE GOVERNANCESTRATEGIC REPORTOVERVIEW
Colleague survey
An important part of our colleague engagement is our annual colleague survey, conducted in partnership with People Insight. This year, we had the
opportunity to compare our results with those from the previous year, providing valuable insights into our progress and areas for development. We
have benchmarked our findings against industry standards within the private sector, offering a broader perspective on our performance.
2024 colleague survey in numbers
Our annual colleague engagement survey launched in November 2024 achieved an impressive 84% response rate, representing 1,514 colleagues,
marking a significant increase from 77% in 2023. The survey unveiled the following insights:
The survey further highlighted questions in the areas of Purpose and Leadership which returned favourable and improved responses when
compared to 2023 or external benchmark. These indicators show our colleagues believe action will be taken based on the survey results, and they
have a clear understanding of our business objectives.
Themes Response Favourability Private Sector 2023 Survey
Purpose
81% 13% 6%
+4 +1
Enablement
73% 15% 13%
+5 0
Autonomy
69% 15% 15%
-3 -3
Reward
62% 22% 16%
-1 0
Leadership
67% 20% 13%
+2 +1
Engagement
73% 19% 8%
-5 0
Question Theme Response Favourability Private Sector 2023 Survey
I understand the
objectives of my
business
Purpose
92% 5% 3%
+8
+1
Question Theme Response Favourability Private Sector 2023 Survey
I believe action
will be taken as
a result of this
survey
Leadership
46% 32% 22%
-10
+5
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LSL PROPERTY SERVICES PLC ANNUAL REPORT AND ACCOUNTS 2024
44
Sustainability Report continued
PEOPLE
2024 2023 External benchmark
1
Survey response rate 84% 77%
Colleague engagement
2
73% 73% 79%
Survey themes
Having a purpose 81% 80% 77%
Understanding the
objectives of our
business
92% 91% 84%
Knowing how the work
we do helps our business
achieve its objectives
94% 93% 88%
Enablement 73% 73% 68%
Perception of leadership 67% 66% 65%
Autonomy 69% 72% 72%
Reward & recognition 62% 62% 63%
Belief in action 46% 41% 56%
As a result of the feedback, we identified three areas of focus for
2025:
Reinforce senior management listening and involving: perception
of senior management is increasingly positive since last year.
Clarity of future direction is an area of success to be celebrated.
Senior managers listening and seeking opinions to inform decisions
is important for colleague engagement.
Improve workload & work-life balance: whilst health and
wellbeing support is viewed positively in its broader sense,
workload and work-life balance have attracted higher negative
scores this year. Workload and work-life balance also feature as a
theme for improvement in colleague commentary.
Improve performance & recognition: informal recognition, such
as thanks or praise, is vastly improved. However, feeling recognised
for work done and performance-related pay continue to be
areas of dissatisfaction. Perception of feeling recognised through
development opportunities is similar to 2023, yet managers are
viewed less positively in their support of development and would
benefit from re-energising this focus.
Employee share schemes
We provide our colleagues with the opportunity to invest in our
business by offering all-employee share schemes such as our
BAYE/SIP and SAYE. The BAYE/SIP scheme allows colleagues to buy
LSL shares on a monthly basis in a tax efficient manner with LSL
matching one share for every five shares bought. The SAYE enables
colleagues to save monthly with the opportunity to buy LSL shares
at the end of the saving period. We are pleased that 14% of our
colleagues participated in the 2024 SAYE offer. This was lower than
the participation in 2023 (20%) but in line with the offer before that
in 2021 of 16%.
Notes:
1 Source: People Insight
2 Our engagement score is a representation of how committed, motivated and satisfied colleagues are with their work and the organisation
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LSL PROPERTY SERVICES PLC ANNUAL REPORT AND ACCOUNTS 2024
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OTHER INFORMATIONFINANCIAL STATEMENTSCORPORATE GOVERNANCESTRATEGIC REPORTOVERVIEW
Diversity & Inclusion
We believe that having a diverse workforce and an inclusive culture is important to our business. More information is included in our Living
Responsibility Report.
We have adopted the diversity targets that are incorporated into the UK Listing Rules. Our progress towards these targets is reported in the
Nominations Committee Report on pages 74 and 75, alongside the gender and ethnicity metrics of our Board and Executive Committee. Our senior
management and all colleague gender and ethnicity mix is represented below:
Senior Management Team
1
Male Female
31 December 2024
68% 32%
30 14
31 December 2023
67% 33%
30 15
All colleagues
2
Male Female
31 December 2024
54% 46%
965 837
31 December 2023
54% 46%
932 792
Senior Management Team
1
White Ethnic minority
31 December 2024
95% 5%
39 2
31 December 2023
95% 5%
38 2
All colleagues
2
White Ethnic minority
31 December 2024
88% 12%
1,255 170
31 December 2023
92% 8%
1,172 107
We have seen an increase in the proportion of colleagues identifying as ethnic minority across the workforce. We will continue to work with the
I&D Forum to improve diversity and inclusion across the Group.
Notes:
1 Our Executive Committee and Divisional Managing Directors and their direct reports who are A1 and A2 grades (excluding Executive Directors). Non-disclosure rate is
9% (4 colleagues)
2 All colleagues. Ethnicity data obtained through the all-colleague survey. Non-disclosure rate is 6% (89 colleagues) which is the proportion of colleagues completing the
survey who chose not to disclose their ethnicity
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LSL PROPERTY SERVICES PLC ANNUAL REPORT AND ACCOUNTS 2024
46
Sustainability Report continued
Disability
Over the last two years, we have focused on being a better place to
work for our colleagues who have a disability or long-term health
condition. We were awarded ‘Disability Confident’ employer status
by the Department of Work and Pensions in 2022, and we continue
to work on a programme of training with Disability Rights UK, to
upskill colleagues on the Equality Act and its implications.
We have continued to use our annual colleague survey to understand
how many of our colleagues have a disability or long-term health
condition. In total, 17% of our workforce (2023: 17%) disclosed that
they have a disability or long-term health condition, which is in line
with national census data for the working age population. Our non-
disclosure rate was steady at 4%. During 2025, we are committed
to achieve Disability Confident Leader status with the support of
Disability Rights UK. We have established a Disability Forum, whose
members are receiving ongoing training and will work with our
colleagues to understand challenges faced in the workplace and
supporting reasonable adjustments.
Human rights and modern slavery
We create employment directly for our colleagues and indirectly
within our supply chains. This means human rights and modern
slavery are at the core of our commitment to doing the right thing.
We are committed to adhering to the UN Guiding Principles on
Business and Human Rights, promoting the highest standards of
integrity, personal conduct, ethics and fairness, in line with the UK
regulatory environment we operate in.
We protect and promote the human rights of our colleagues in the
following ways:
Undertaking pre-employment checks on all new colleagues,
confirming their identity and eligibility to work in the UK.
Providing clear and timely information to colleagues on their
statutory rights, including sick pay, holiday pay and other benefits
they are entitled to.
Paying our colleagues fairly and continuing to ensure all colleagues
across the Group are paid at least the Real Living Wage.
Maintaining regular communication with our colleague
community, using the CEF and regular colleague surveys.
Regularly calculating and monitoring our gender pay gap across
the Group.
Completing annual compliance training on modern slavery.
Making available grievance and whistleblowing channels for
colleagues and ensuring whistleblower protection.
Across the Group we expect all parts of our supply chain to adhere
to international standards on human rights, including with respect
to child and forced labour, land rights and freedom of association.
Our Surveying & Valuation Division includes a risk assessment as part
of its supplier due diligence processes. We also continue to operate
procedures to comply with the FCAs consumer duty regime.
We are committed to taking active steps to identify human rights
issues. During 2024, within our Surveying & Valuation Division
we made 527 reports setting out safety or vulnerability concerns
relating to our customers, and we will continue to take steps to
ensure our colleagues have the confidence and awareness to identify
vulnerabilities, whether they be in relation to customers with
particular needs or concerns. In 2024 we had a significant increase
in the reporting of vulnerable customer cases as a result of our
increased awareness of the topic and an increase in market share of
Equity Release Lender Clients.
These procedures collectively help to address our ongoing
commitment to protect our colleagues’ and stakeholder human
rights and the elimination of all forms of forced and compulsory
labour.
Colleague policies
We have centralised Group colleague policies, as well as separate
specific Divisional policies for certain matters. Our Group policies
cover topics such as family friendly initiatives, equality and diversity,
pregnancy loss, menopause, stress and mental wellbeing, colleague
data protection & security arrangements and how our colleagues can
support the environment.
Group and Divisional learning and development teams also publish
training material to support colleague learning and compliance with
the policies.
Combined ethics policy
Our Group-wide combined ethics policy outlines our approach to
anti-corruption and bribery (including hospitality), anti-slavery and
human trafficking, conflicts of interest, tax evasion, whistleblowing
and fraud. We have an annual programme of compliance training for
colleagues that includes anti-money laundering, financial crime and
information security.
Whistleblowing – ‘Speak Up’
We have a whistleblowing policy that allows all of our colleagues
to raise concerns on matters related to the Group and ensure that
anything raised is investigated. This is via our Group-wide ‘Speak Up’
policy which outlines our colleague whistleblowing channel. During
2024, we again ran a ‘Speak Up’ week to raise awareness of the
channel and the protection offered to any whistleblowers. Our Group
CPO regularly reports the outcomes to the Board.
Graphics
COMMUNITY
We want to have a positive and lasting impact on the communities we work in. This involves us creating
opportunities for our colleagues to volunteer for charities, providing Give As You Earn opportunities and
evolving Group-wide campaigns led by our Communities Forum. You can find more information on our work in
the LSL Communities Forum section of our website.
ENVIRONMENT
We are working towards reducing our impact on the environment. More information can be found in our TCFD
and CFD reporting on pages 49 to 59.
GOVERNANCE
Our approach to governance is described in our Corporate Governance Report on pages 64 to 71.
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OTHER INFORMATIONFINANCIAL STATEMENTSCORPORATE GOVERNANCESTRATEGIC REPORTOVERVIEW
Health and safety
Our Group CFO is responsible for health and safety across the Group.
We are committed to ensuring colleagues work in a safe and healthy
working environment. Within e.surv, which is our largest employer,
we are certified to ISO 45001. The nature of the field work within
the Surveying & Valuation Division underlines the importance of our
health and safety arrangements to us.
As part of our management of occupational health and safety, we
monitor the identification of hazards, occurrence of accidents,
and employer and public liability claims. During 2024, there were
two RIDDOR reportable incident (2023: 1) and no work-related
fatalities. There were no employer liability claims in 2024 (2023: 0).
Group-wide health and safety reports go to the Board bi-annually.
Internal Audit undertakes a rolling audit of health and safety data
and procedures and there are currently no high-priority actions
outstanding.
Payment practices reporting
Your Move, First Complete and e.surv (our Group entities which meet
the thresholds for statutory reporting set out in the Small Business,
Enterprise and Employment Act 2015) annually submit their payment
practices reports, which are available on the Governments website
for report submissions (check-payment-practices.service.gov.uk).
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Reporting requirement Cross reference/location of reporting Page
Climate-related financial disclosures TCFD and CFD Reporting 49
Environmental matters (including the impact
of our businesses on the environment)
Our colleagues
Social matters
Respect of human rights
Anti-bribery and corruption matters
Corporate Governance Report
Sustainability Report
Section 172 Statement and Stakeholder Engagement
Living Responsibly Report 2024
64
41
26
See separate report
Business Model Business Model and Strategy 4
Non-financial policies Sustainability Report includes overviews of our
policies relating to:
Human rights and modern slavery.
Anti-corruption and bribery.
Whistleblowing and speak-up arrangements.
Health and safety.
Colleague employment policies.
41
Principal risks relating to the non-financial
matters and how these are managed
Risk Management 34
Non-financial KPIs Sustainability Report
Corporate Governance Report
Living Responsibly Report 2024
41
64
See separate report
The table below includes information required by section 414CB of the Companies Act 2006:
LSL PROPERTY SERVICES PLC ANNUAL REPORT AND ACCOUNTS 2024
48
Non-Financial and Sustainability
Information Statement
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LSL PROPERTY SERVICES PLC ANNUAL REPORT AND ACCOUNTS 2024
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OTHER INFORMATIONFINANCIAL STATEMENTSCORPORATE GOVERNANCESTRATEGIC REPORTOVERVIEW
TCFD and CFD Reporting
Governance
Our commitments Progress
Review how the Board and Audit & Risk Committee are
informed about climate-related matters, and how these
matters are considered in relation to strategy and risk
management.
Review and develop the roles of the Environment
Working Group (EWG) and Climate-Related Working
Group (CRWG).
Ensure risk management frameworks and business
planning integrate and consider climate-related risks
and opportunities.
Develop and monitor delivery of climate-related
learning and development.
Further action is required to formalise how the Board and Audit & Risk
Committee are consistently informed about and consider climate-related
risks effectively. These commitments are carried over into 2025.
The roles of the EWG and CRWG have been combined within the EWG only,
with revised terms of reference agreed in January 2025.
Our newly appointed Group CRO will lead on developing the roles of
the EWG and ensuring the risk management framework and business
planning sufficiently consider climate-related risks and opportunities. These
commitments are carried over into 2025.
So far, climate-related training has been focused on our Surveying &
Valuation Division and its delivery is being monitored on an ongoing basis.
ESG compliance training, including climate-related content, will be rolled out
to the wider Group in 2025.
Strategy
Our commitments Progress
Further understand and set targets for reducing scope
3 emissions, including setting Net Zero targets.
Update our climate transition plan to reflect the group
restructuring.
Continue to develop our response to climate-related
issues and modelling to assess different climate-related
scenarios.
We have taken steps to appraise our pathway to Net Zero 2040. This
included the commissioning of a Net Zero strategy paper by our
sustainability consultants, Energise. This paper supersedes our previous
Climate Transition Plan. In 2025 we will publish our Net Zero 2040 strategy
and engage with our Divisions to develop action plans against targets.
In 2025 we will establish reporting against targets as part of our Net Zero
2040 strategy.
The development of our climate modelling and scenario-analysis will
continue in 2025 under the leadership of our new Group CRO. He will be
supported by Living Responsibly Steering Committee and Head of ESG.
TCFD and CFD Statement
Our climate related disclosures have been prepared in accordance
with the following:
1. Companies Act (section 414CB(2A)).
2. UK Listing Rules (UKLR 6.6.6(8))
3. Task Force on Climate-related Financial Disclosures (TCFD).
4. Streamlined Energy and Carbon Reporting (SECR) (specifically
the requirements to disclose greenhouse gas emissions, energy
consumption, energy efficiency action are set out in Schedule 7 of
SI2008/410).
Compliance
We confirm that we have complied with the 11 TCFD
recommendations in relation to the disclosures made in this TCFD
and CFD Statement through our explanations of the climate related
governance, risks & opportunities and metrics and targets in place.
However, we recognise that we have not made the progress we
had hoped to make in 2024 in relation to our reporting on climate
strategy and risk management and will look to improve this in 2025.
Climate related commitments
We set out below the progress made in 2024 to improve our climate-
related processes, including reporting against commitments made in
our 2023 Annual Report and Accounts.
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50
TCFD and CFD Reporting continued
Risk management
Our commitments Progress
The EWG and CRWG working to further develop our
arrangements for assessing and managing climate-
related risks and opportunities.
Continuing to review climate-related risks and
opportunities identified in 2023 and update as
necessary.
Ensuring climate-related risks are included in the
continued development of our Group risk frameworks
and arrangements.
Our climate-related risks and opportunities have been reviewed and
updated by Divisional working groups made up of representatives from risk
and finance. On an annual basis, Group Finance provide market related
assumptions to each Division. Division planning actions consider climate
related issues and risks or opportunities identified as material to the
business are brought forward into financial planning activities.
Divisional risk assessments have been reviewed, collated and presented at
the EWG.
Group risk frameworks and arrangements are in the process of being re-
defined and enhanced under the leadership of our new Group CRO.
Commitments from 2024 are therefore ongoing through 2025.
Metrics and targets
Our commitments Progress
Review and update the period for baseline emissions
data following restructuring in 2023.
Updating our climate transition plan (including scope 3
emissions) and carbon footprint baseline.
EWG working to enhance our understanding of our
environmental impacts and identifying additional KPIs
where appropriate.
Our 2023 Living Responsibly Report (published in April 2024) included our
revised baseline carbon footprint, including scope 3 data, and took into
account the transition of our estate agency business to a franchising model.
Based on this revised baseline, our climate transition plan has been
superseded by our new Net Zero Strategy, which includes targets for scope
1, 2 and 3 and priority actions to achieve those targets.
A preliminary impact materiality assessment has been undertaken, with
oversight from the EWG, which has stated our priority impacts.
Environmental KPIs for carbon and waste are detailed in our 2024 Living
Responsibly Report.
Climate-related governance
The key governance forums that consider climate related issues is set out below:
Board
Oversight and final approval of Annual Report including
climate-related financial disclosures.
Audit & Risk
Committee
Living Responsibly
Steering
Committee
(SteerCo)
Audit & Risk Committee oversees the risk framework and
financial controls.
Living Responsibly SteerCo reviews and recommends
approval of climate risks and disclosures to Board.
Environmental
Working Group
(EWG)
Considers the climate-related risk assessment approach
by the Group and the Divisions, and leads on process
improvement.
Graphics
Board The Board has overall accountability and oversight of climate-related risks and opportunities within the Group
and approves the climate-related disclosures in the Annual Report and Accounts. The Board receives annual
updates from the Group CPO on ESG matters which are discussed at the Living Responsibility SteerCo. The
Group CPO is responsible for the performance of the Living Responsibly strategy, ensuring it is aligned to our
business model. Day-to-day management is delegated to the Group Head of ESG. The Board has delegated
oversight of risk management, including in relation to climate related risks, to the Audit & Risk Committee, from
which it receives regular updates in order to inform its decisions. The updates to the Board are via the Chair
of the Committee, who sits on the Board, who provides a summary of all matters discussed at the most recent
meeting of the Committee. ESG risks are included in our principal risks and uncertainties which are approved by
the Board (see page 38).
Sonya Ghobrial, one of our independent Non-Executive Directors has extensive experience in ESG matters.
Audit & Risk
Committee
The Audit & Risk Committee (ARC) oversees, on behalf of the Board, the framework in place to manage risk,
which includes climate-related risks and opportunities. The ARC periodically considers the Group’s principal risks
and uncertainties, which includes considering ESG related risk, and discusses these with our Group CRO. It also
considers the methodology for our assessment of climate-related risks and provides oversight and assurance
to the Board on our judgement and reporting of them. The Group CRO attends each ARC meeting to discuss
material risks across the Group and Divisions, including climate-related risks where applicable. The ARC reviews
this TCFD and CFD Statement on behalf of the Board and considers the impact of climate-related matters within
our financial reporting.
Living Responsibly
Steering Committee
(SteerCo)
The Living Responsibly SteerCo is the most senior group with a governance role solely related to ESG matters. It
is chaired by the Group CEO, and its members include the Group CFO, Group CRO, Group Company Secretary,
Group CPO and the Head of ESG. The primary role of the SteeroCo is to establish the ESG policy and strategy
for the business and monitor progress against commitments. It is responsible for implementing arrangements
to support the climate-related risks and opportunities assessment, which includes: providing resources and
guidance to the EWG (see below); approving changes to process; reviewing and approving reporting and
updating the Board as required (including in relation to climate-related risks and related disclosures).
Environmental
Working Group
The EWG was formed by the Living Responsibly SteerCo to own and champion our commitment to reduce
environmental impact across the Group. One of their key aims is to review and maintain the climate-related
risks and opportunities register and annually understand the impacts on any business planning. The EWG works
closely with the Divisions and Group functions to ensure Group-wide alignment of our environmental strategy,
including moderation and rationalisation of our climate-related risk assessments. The EWG meets bi-monthly
and its membership includes the Group CRO and divisional Heads of Risk, Head of Facilities Management, Head
of ESG, Group Financial Controller and other colleagues from across divisions with an interest in environmental
matters.
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OTHER INFORMATIONFINANCIAL STATEMENTSCORPORATE GOVERNANCESTRATEGIC REPORTOVERVIEW
Our Executives and management also have responsibilities in
relation to climate risk. Our Group CEO and Group CFO both have
performance targets that are aligned with our corporate sustainability
and ESG strategies, which are set and monitored by the Remuneration
Committee. More detail is included on page 92. Our Group CEO has
overall responsibility for our corporate sustainability and ESG strategy.
Our Group CFO leads the reporting on risks and internal controls and
is responsible for planning and budgeting processes which considers
the impact of climate related risks (both transition and physical) and
related costs on our businesses alongside any opportunities and
associated revenue.
As explained in more detail in the Risk Management section of this
Report on page 34, we appointed a Group CRO in 2024. He is our
environmental executive sponsor, allowing him to be in the best
position to ensure that our risk framework and reporting has sufficient
focus on climate related matters. He works closely with the Divisional
Risk Officers to ensure a cohesive strategy across the business.
We hired a new Head of ESG in January 2025 and have reviewed and
repurposed our priorities for 2025 (as described on pages 49 and 50).
Central functions, including HR, legal and facilities, provide support
on climate related matters including, but not limited to, compliance,
development of policies and incentives and the collection of
emissions data. Our Internal Audit team provide assurance on Group
arrangements to the Audit & Risk Committee.
Climate strategy
Climate related matters present a relatively low impact on our overall
strategy. However, we recognise that it offers certain opportunities
to create new and more non-cyclical revenue streams and presents
certain risks in parts of our business. We have utilised two scenarios to
assess the potential impact of climate related matters on our strategy,
business and financial planning. The scenarios considered are:
Scenario 1 – Net Zero by 2050
Scenario 2 – Three degree rise
For the purpose of scenario planning, a Net Zero 2050 date has been
selected. This timeframe does not form part of LSLs Net Zero 2040
ambition.
The following sets out our approach to and methodology for assessing
climate related risks and opportunities together with the outputs of
risks and opportunities identified for each scenario.
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52
TCFD and CFD Reporting continued
Climate-related risks and opportunities
In 2023 we established the Climate Risk Working Group (CRWG)
to lead climate risk assessment activities and to share information
across the Divisions. The composition of this group was very similar
to that of the EWG, therefore, in order to simplify governance
processes and improve efficiency, the responsibilities of the CRWG
have been subsumed into the EWG.
Last year we committed to review the climate change scenarios
used for our climate-related risk assessments. Given the changes
to the Senior Management Team described in the governance
section above, this has not been done in 2024, and therefore for the
purposes of risk assessments and disclosures as relates to the 2024
reporting year, the scenarios remain the same as those used in the
2023 reporting year (described below). The principal transition and
physical climate risks as identified in 2023 have been used as the
basis of the revised risk assessment undertaken in 2024.
Our risk assessment this year has been informed by calculation of
our scope 3 emissions for 2023/2024, which we can now compare
to our revised 2022/2023 baseline emissions as reported in the 2023
Living Responsibly Report (published April 2024). This process has
highlighted priority focus areas for decarbonisation, including fleet
and supply chain emissions.
Improvements have been made to the clarity of our disclosure
on our climate related risks and opportunities. However, there
remains significant scope for improvement in our climate-related
risk assessment processes and integration into wider divisional and
Group level risk management processes. This work will continue into
2025 under the leadership of our Group CRO.
Climate-related risk assessment methodology
The EWG led our assessment activities, providing a forum for
identifying and sharing information on climate-related risks and
opportunities. The review and update of the assessments at a
granular level was undertaken by smaller Divisional risk working
groups (as described in the Climate-related governance section
above). The Divisional working groups make use of a risk assessment
framework as established by the EWG and work through the risks
under the two scenarios and three timeframes, taking the form of
a number of collaborative workshop sessions, where stakeholders
reach consensus on risk ratings, and recording commentary to justify
their ratings.
The approach to this included using climate scenario modeling data
from the Network for Greening the Financial System (NGFS) portal
and applying these to the exposure dimensions listed within the
template. In each dimension, the terms assessed the scale of the
impact in the short, medium and long term.
We group climate-related risks into two categories:
physical risks including those related to the physical impacts of climate change; and
transition risks including those relating to the transition to a lower carbon economy. This could be the introduction of legislation or the costs
associated with becoming Net Zero.
Risk assessment
framework
Template with
previously identified
risks, previously
agreed time horizons
and two climate
scenarios.
Provided to divisional
working groups with
guidance from EWG.
Divisional
risk working
groups undertake
assessment
Divisional groups use
industry knowledge
and apply a
quantitative approach
to identify risks
and opportunities
applicable to their
operations.
Groups apply risk
ratings across time
horizons and in two
climate scenarios.
Identify
financial impact
of risks and
opportunities
Divisional finance
teams with support
from Group apply
financial impact to risk
assessment.
Review and
moderation
EWG review Divisional
risk assessments.
Feedback to Divisional
working groups.
Outputs combined
into the summary
included in this report.
Overview of approach applied
Graphics
Scenario
Net Zero 2050
Quick and significant policy change;
food and fuel price increases; huge
change in customer and labour
preferences
Three degrees rise
Business as usual policy, large scale action
delayed to long term; increased physical
impacts in short to medium term
Global population 9.6bn 9.9bn
Average temperature increase 1.3degC 2.0degC
Weather Stable Extreme
Clean energy 92% 35%
Magnitude of financial impact Description
Low Below 5% of five-year average underlying operating profit.
Medium 5-10% of five-year average underlying operating profit.
High Over 10% of five-year average underlying operating profit.
Time periods applied to assessment Notes
Short-term (0-3 years) Aligns with our three-year planning cycle.
Medium-term (4-9 years)
Selected to include year 2030, linked to our near-term targets and phase out of new petrol
and diesel cars; as well as two further three-year planning cycles.
Long-term (10+ years) Beyond the above dates.
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OTHER INFORMATIONFINANCIAL STATEMENTSCORPORATE GOVERNANCESTRATEGIC REPORTOVERVIEW
Climate-related risk analysis and financial impact
Climate-related scenario analysis
1
Notes:
1 Source: ARUP
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LSL PROPERTY SERVICES PLC ANNUAL REPORT AND ACCOUNTS 2024
54
Primary climate-related risks and opportunities
Following the risk assessments undertaken by each Division, application of financial impact, and collation and moderation by the EWG (and Audit
& Risk Committee); the key risks and opportunities which could have a financial impact on the operating profit of the Group are summarised in the
table below.
The identified risks and opportunities, presented over the short, medium and long-term horizons are considered to have a low material financial
impact on the Group strategy and operating model.
Scenario: Net Zero 2050
Specific risk Business Impact Applicable Divisions Timeframe Impact Financial Impact Planned Actions
Type of risk: Transition risks
Increased environmental
commitments and
administration driven by
current and future B2B
customers.
Increased administration costs
to meet additional disclosure
requirements and deliver
environmental commitments.
All Short Low
Develop environmental
capability across the
group to support
decarbonisation actions
and reporting.
Costs associated with
becoming Net Zero across
all emission scopes.
Potential increased
operational costs associated
with delivering action to
reduce emissions and
purchasing carbon offsets.
All Short Low
Establish Net Zero project
group to appraise the
action, cost and support
needed to reduce
emission hotspots across
the Group.
Increased regulation
in the property
sector to reduce the
environmental impact
of properties, could
affect the availability and
affordability of housing
Reduced demand across
portfolio of services.
All Short Low
Build expertise in EPCs
and valuation of energy
efficient properties.
Type of risk: Physical risks
Properties impacted
by climate conditions
(such as floods) become
uninsurable and
potentially unsuitable as
security for a mortgage.
Reduced demand across
portfolio of services.
All Medium Low
Monitor data on
properties subject to new
or additional climate risk.
Travel disruption
impacting ability to
deliver contracted
services.
Increased cost of service
delivery, potential impact on
brand reputation.
All Medium Low
Include climate impact
as part of Business
Continuity planning.
Evaluate and develop
virtual survey service.
Type of risk: Opportunities
Collaboration with
stakeholders to improve
climate action, strategy
and reporting.
Improved brand reputation
with customers, contributing
to long-term relationships.
All Short Low
Engage stakeholders to
collaborate on climate
actions and improve
disclosures.
Increased interest in
data services from
B2B customers looking
to mitigate their own
climate related risks.
Increased revenue from new
service lines.
Surveying &
Valuation and
Financial Services
Long Low
Investment in data
services and training to
develop new product
lines within Surveying &
Valuation and Financial
Services.
TCFD and CFD Reporting continued
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OTHER INFORMATIONFINANCIAL STATEMENTSCORPORATE GOVERNANCESTRATEGIC REPORTOVERVIEW
Scenario: Three degrees rise
Specific risk Business Impact Applicable Divisions Timeframe Impact Financial Impact Planned Actions
Type of risk: Transition risks
Increased need to
consider climate
related impacts when
assessing capital
allocation/improving
investment proposals.
Reduction in investment
opportunities capable of
delivering the required level
of growth to achieve the
Group's strategic aims.
All Short
Low Investment Committee to
consider climate impact as
part of the Group's capital
allocation policy.
Ensure investment
requests will address
climate-related risks,
opportunities or
intervention costs.
Increased regulatory
costs or climate-related
taxes.
Potential increased
operational rates associated
with climate mitigation
actions and compliance with
regulation.
All Medium
Low Monitor regulatory
landscape.
Type of risk: Physical risks
Properties impacted
by climate conditions
(such as floods)
become uninsurable
and potentially
unsuitable as security
for a mortgage.
Reduced demand across
portfolio of services.
All Short
Low Monitor data on number
of properties subject to
new or additional climate
risk.
Travel disruption
impacting ability to
deliver contracted
services.
Increased cost of service
delivery, potential impact on
brand reputation.
All Medium
Low Include climate impact as
part of business continuity
planning.
Type of risk: Opportunities
Increased stakeholder
interest in
understanding energy
efficiency (for example
via the EPC).
Increased revenue from new
service lines.
Surveying
& Valuation
Medium
Low Investment in data and
training across Surveying
& Valuation Division to
offer services in climate
risk and adaption.
Increased interest in
data services from
B2B customers looking
to mitigate their own
climate related risks.
Increased revenue from new
service lines.
All Medium
Low Investment in data
services and training to
develop new product
lines within Surveying &
Valuation and Financial
Services.
The identified risks and opportunities support the position that climate change has a relatively low impact on our overall strategy.
Scenario 1 – Net Zero by 2050
Under this scenario, we consider transition risks to present the
largest business impact. Costs associated with decarbonisations
activities, including supply chain emissions, investment in renewable
energy and procurement of carbon credits are expected. It is
anticipated that supply chain costs will increase as suppliers
transition to a low carbon economy.
The cost of reporting and disclosure is anticipated to increase as
government policies and regulatory requirements become stricter.
Scenario 2 – Three degree rise
Under scenario 2, we anticipate physical risks to present the most
significant business impact. In addition to increased taxes to fund
climate intervention, we expect to see a rise in business continuity
costs associated with the adaptation of office space and protection of
the workforce from climate change.
Opportunities are identified under both scenarios and include the
introduction of new products and services enabling clients to assess
and adapt to climate change.
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TCFD and CFD Reporting continued
Specific risk Applicable Divisions
Type of risk: Transition Risks
Customer choice driven by environmental commitments in the B2C space. All
Ban on new petrol and diesel cars from 2035. Surveying & Valuation
Type of risk: Physical Risks
Impact of changing weather on colleagues including health matters. All
Increased supply costs arising from climate events. All
Type of risk: Opportunities
‘Green valuation’ product offering – promoting use of local surveyor. Surveying & Valuation
Increasing prevalence of ‘green’ mortgages and green property upgrades. All
Potential growth in retrofitting environmental upgrades for consumer homes. All
Other risks and opportunities
In addition to the primary risks and opportunities, others were considered as part of the wider assessment of climate-related scenario testing, as
follows:
Strategy impact assessment and resilience
The assessment of the chosen scenarios demonstrate that climate
related matters have a relatively low impact on our strategy and
business model, and therefore there is a high degree of resilience.
However, there are a number of risks that may result in increased
costs and have an impact on operations that, whilst unlikely to have
a significant impact, are factored into our business and financial
planning.
Climate-related metrics and targets
In 2024, we focused on improving data collection for greenhouse gas
emissions reporting, integrating organisational changes into Scope 3
emissions for franchises and, for the first time, including emissions
from investments.
As our data matures, we will monitor emissions against a rolling
baseline and use this to establish reduction targets aligned with a Net
Zero 2040 pathway.
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OTHER INFORMATIONFINANCIAL STATEMENTSCORPORATE GOVERNANCESTRATEGIC REPORTOVERVIEW
Streamlined energy and carbon reporting
(SECR)
The Group has reported on all emission sources required under The
Companies (Directors’ Report) and Limited Liability Partnerships
(Energy and Carbon Report) Regulations 2018, which includes the
SECR requirements. We have applied a financial control methodology,
reporting emission sources that fall within the Group Financial
Statements (with the exception of Pivotal Growth – see below). We
do not have responsibility for any sources that sit outside this.
Within the Group our Surveying & Valuation entity, e.surv, is also
in scope of the SECR requirements. In accordance with these
regulations we have reported a Group-wide disclosure and therefore
e.surv as the in-scope entity will not be making any separate
disclosures.
This section covers the seven main Greenhouse Gases (GHG)
covered by the Kyoto Protocol which include carbon dioxide (CO2),
methane (CH4), nitrous oxide (N2O), hydrofluorocarbons (HFCs),
perfluorocarbons (PFCs), sulphur hexafluoride (SF6) and nitrogen
trifluoride (NF3). It has used the Greenhouse Gas (GHG) Protocol
Corporate Accounting and Reporting Standard (Revised edition), and
emission factors from the Governments GHG emission factors for
Company Reporting.
Metric 2024 2023
Total kWh (Scope 1 + Scope 2) 2,777,178 8,016,326
Scope 1 emissions (natural gas and company vehicles), tCO2e 692 730
Scope 2 electricity (location-based), tCO2e 292 996
Total Scope 1 + Scope 2 (location based), tCO2e 983 1,727
tCO2e (Scope 1 + 2) per employee
1
(location-based) 0.5 0.6
tCO2e (Scope 1 + 2) per £ million revenue
2
(location-based) 5.7 9.8
Scope 2 emissions from purchased electricity (market-based) 240 637
Total Scope 1 + Scope 2 emissions (market-based) 932 1,368
tCO2e (Scope 1 + 2) per employee
1
(market-based) 0.5 0.5
tCO2e (Scope 1 + 2) per £ million revenue
2
(market-based) 5.4 7.7
Notes:
1 Total colleague numbers as at 30 September 2024
2 Revenue from total operations
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Greenhouse gas emissions
Our full GHG emissions detail is reported here including scope 3 emissions for the second year. The reporting period is 1 October 2023 to 30
September 2024. This overlaps by nine months with the Group’s financial year and is used for historical reporting reasons.
GHG emissions 2024 data summary table
Tonnes CO2e
Market / (Location) based
Scope Category 2024 2023
Scope 1 Operations of facilities (fuels including gas) 286 287
Owned vehicles 387 396
F-gas 19 48
Total 692 730
Scope 2 Purchased energy 240 (292) 637 (996)
Total 240 (292) 637 (996)
Scope 3 Purchased goods and services 3,776 10,391
Capital goods 159 39
Fuel and energy-related activities 233 416
Upstream transportation and distribution 16 120
Waste generated in operations 2 13
Business travel 1,168 1,316
Colleague commuting (including homeworking) 1,006 1,823
Franchises 1,988 341 (678)
Investments 2,777
Total
11,123
14,461
(14,797)
Total Scope 1, 2 and 3 Market/(Location) based 12,055
(12,106)
15,828
(16,524)
TCFD and CFD Reporting continued
Data notes
Greenhouse gas reporting assumptions and estimations
In some cases, missing data has been estimated using either
extrapolation of available data from the reporting period or
estimated using CIBSE Guide F (2021) Building Benchmark and
Facility Floor Size. The methodology used to estimate the supply
chain emissions from purchased goods and services, upstream
transportation and distribution, and capital goods is based on the
Exiobase environmentally extended input-output (EEIO) dataset. EEIO
combines economic information about the trade between industrial
sectors with environmental information about the emissions arising
directly from those sectors.
Data coverage and quality
The Group has adopted to use a financial control approach
to consolidate emissions as described in the Greenhouse Gas
Protocol. Where applicable, both Market and Location-based
emissions are reported. Our elected intensity ratios are reported
against revenue and headcount.
Included in our 2024 reporting year are emissions from
investments related to our joint venture, Pivotal Growth. The
emissions in this category have been estimated based on a 2024
revenue figure, and account for 23% of the Group's total market
based GHG emissions.
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OTHER INFORMATIONFINANCIAL STATEMENTSCORPORATE GOVERNANCESTRATEGIC REPORTOVERVIEW
Net Zero strategy and targets
Throughout 2024 we have taken steps to appraise our pathway
to Net Zero 2040. This included the commissioning of a Net Zero
strategy paper by our sustainability consultants, Energise. The report,
taken from a 22/23 baseline, showcased that due to the nature
of their operations, our Surveying & Valuation Division (e.surv)
accounted for 58% of Group Scope 1 emissions and contributed
to 45% of all business travel emissions. Therefore, during 2024 we
have prioritised the build out of a Net Zero plan for this Division and
developed three specific science aligned targets:
Scope(s) Target
1
1 & 2 Near-term reduction of 42% by 2030
3 Near-term reduction of 25% by 2030
All 90% reduction by 2040
Over the course of 2025 and under the guidance of the EWG, a
program team will be established to develop Group wide targets and
actions for all emission scopes.
Decarbonisation actions
A number of actions have been progressed in 2024 regarding
decarbonisation, particularly with reference to reducing our Scope 1
and Scope 2 emissions from facilities and fleet.
Energy audits were undertaken at three of our offices in 2024 to
identify priority energy reduction opportunities, related to ESOS
compliance (energy savings opportunities scheme). We progressed
actions including reviewing temperature settings for server
rooms; improving timing of heating controls for occupied spaces
and replacing light fittings where necessary with low energy LED
fittings. Some recommendations have not been possible due to
our offices being leased rather than owned (such as installation of
solar photovoltaic panels).
We have secured a lease on a new office facility for our Head
Office in Newcastle upon Tyne, which we will relocate to in 2025.
The new office is highly energy efficient, it is electrically heated
and cooled and has an EPC A+ rating.
We continue to purchase REGO-backed renewable electricity and
gas for our main office facilities.
Progress continues to be made in transitioning our owned fleet
from internal combustion engine vehicles to hybrid or electric
vehicles. This mainly impacts our Surveying & Valuation Division.
We continue to support a hybrid working model for the majority of
our colleagues (excluding operational surveyors) with a number of
colleagues on remote-first employment contracts. This continues
to limit our emissions from commuting; although we will look
to improve the quality of data with respect to the amount of
commuting and home-working related energy consumption.
Our Net Zero Strategy identified some priority actions for us to move
forward in 2025 and beyond:
We will continue to improve our ability to dynamically collect
data related to emissions to enable more active monitoring and
management. This is likely to involve engaging with a third party
data platform.
We will develop our ESOS related actions and progress reporting
for our management offices, working with our landlords where
required.
We will develop our supply chain management processes,
including due diligence, engagement and data gathering, to better
understand the emissions associated with our suppliers and to
drive reduction.
We will continue to transition our owned fleet to hybrid and full
electric vehicles. For surveying, the largest contributor to fleet
emissions, 91% (286) of vehicles are hybrid or full electric at the
end of 2024.
We will seek to develop policies to incentivise lower carbon modes
of transport for business travel.
We will roll out a training and awareness programme to all
colleagues linked to decarbonisation and wider personal impact on
the environment.
Notes:
1 Against a 22/23 baseline year
Our Strategic Report, which runs from pages 2 to 59, explains how we operate to achieve our business model and is approved by and signed on
behalf of the Board of Directors.
David Stewart
Group Chief Executive
Officer
25 March 2025
Adam Castleton
Group Chief Financial Officer and
Group CEO Designate
25 March 2025