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PROPERTY valuation group LandMark White (ASX:LMW) has more than doubled earnings in the December half-year, driven largely by growth in the commercial division.
The Sydney-based company has posted a $1.02 million profit for the period, up 123.7 per cent from a year earlier.
The company says earnings have yet to fully reflect newly awarded banking panels which it expects to flow through to the bottom line over the coming year.
The result for the six months to the end of December was built on a 21 per cent lift in gross revenue to $14.4 million, a figure that includes franchised offices. Revenue from operations rose 20 per cent to $11.5 million.
While the residential valuation business grew 9 per cent to $7.1 million during the period, LandMark White's commercial services surged 35 per cent to $7.3 million. The growth saw the company fork out an extra $900,000 in employee expenses during the half-year.
CEO Chris Nicholl has credited the latest result to an investment in new systems over the past 18 months.
"We are confident that the demand for our valuation services in both our residential and commercial markets will continue to increase," he says.
"The work we have done to create systems that allows to more than just meet client service standards has translated into LMW winning more work from existing customers."
The company says it has benefitted from fatter margins in both commercial and residential valuations, although the commercial division has room for improvement through the introduction of new systems.
"These investments will take place over the coming calendar year and are possible because of the investment already made in new IT infrastructure," it says.
Nicholl says the planned investment, and the upgrades already put in place, should shield the company from any potential slowdown in the property sector.
"While the property market may slow, we are confident that the foundations we have created will ensure that LMW can continue to grow its market share," he says.
"We believe the investment in business systems and robust risk management processes will further enhance LMW's reputation for quality and independent advice."
LandMark White forecasts its second half will be on par with the first half, although the final six months of FY15 were hit by one-off expenses totalling $405,000 relating to the settlement of two long-running actions against the company.
"Given the strong first half, the board fully expects that in the absence of last year's one off settlements, the second half of this financial year should deliver a result at least similar to the first half," says Nicholl.
LandMark White is paying an interim dividend of 1.25c per share, steady with the previous corresponding period.
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