The largest conveyancing firm in the United Kingdom, Simplify Moving, has announced a significant reduction in its workforce, cutting more than a quarter of its operations and administration staff as part of a strategic shift to take on less work. A report detailing the company's performance for the financial year ending 30 March 2024 reveals that the staff count decreased by 27%, bringing it down to 1,413 employees, and resulting in annual salary savings exceeding £12 million. The restructuring process incurred costs of approximately £1.6 million, as the firm scaled back its workload in response to challenging market conditions.
Simplify Moving operates through a network of eight conveyancing firms and two law firms, including Premier Property Lawyers and Advantage Property Lawyers. The firm has faced a variety of trading pressures attributed to the current cost of living crisis, heightened market uncertainty due to global political instability, and escalating mortgage interest rates, which have collectively dampened the volume of residential property transactions. The company's financial situation is underlined by net liabilities reported at £173 million, with creditor debts amounting to £291 million.
As part of the restructuring efforts, Simplify has decreased its property footprint by exiting various office leases and reducing its workforce through both redundancies and natural attrition. According to the strategic report, this workforce reduction is expected to lower ongoing operating costs while also limiting the firm’s capacity to handle conveyancing work. Directors acknowledged that this would lead to an increase in the percentage of cases that the firm will need to ‘panel out’ to external parties.
Despite these challenges, Simplify Moving managed to achieve an underlying pre-tax profit of £6.4 million for 2023-24 when adjusted for exceptional items, interest, depreciation, and amortisation. This marked a notable recovery compared to a loss of £14.2 million reported in the previous year, with operating losses also declining from £24.1 million to £9.6 million. The firm’s ownership, residing with UK-based investment firm Palamon Capital Partners, has involved shareholders injecting liquidity in the form of loans, totalling over £6 million since December, to support both operational costs and investments in AI and technology.
Looking ahead, the company expects to maintain a robust trading environment and anticipates that its underlying profitability will double compared to the previous year. A spokesperson conveyed that Simplify is pursuing a comprehensive investment programme into technology and personnel aimed at enhancing operational efficiencies and improving customer service experiences. Additionally, shareholders have pledged a legally binding commitment of £3.5 million in future loans should the firm fail to meet its financial targets by the end of March 2025, while arrangements to defer interest payments on existing loans have also been established.
Source: Noah Wire Services