Shares in Mortgage Advice Bureau (MAB) jumped as much as 15 per cent on Tuesday morning after the financial services firm hailed “growing market momentum” after a “highly challenging 2023”.
The firm reported that its adjusted earnings before tax (EBITDA) jumped 31.3 per cent year on year to £13.8m for the first half of 2024.
Adjusted pretax profit came in 39.9 per cent higher at £12.3m. On a statutory basis, MAB saw a 17.9 per cent profit drop to £6.2m.
Meanwhile, its revenue increased 5.4 per cent to £123.9m.
Tuesday’s rally has done little to improve MAB’s year to date performance, with its shares down 24 per cent since the start of 2024.
The AIM-lsited firm, which has a market capitalisation of £349.4m, provides mortgage advice through a network of more than 2,000 advisers with access to over 90 lenders.
The UK’s mortgage market has struggled with lower levels of demand over the last couple of years as higher interest rates and economic uncertainty put off would-be borrowers.
However, there are now signs of recovery as mortgage rates are coming down after the Bank of England cut its base rate in August for the first time since March 2020.
“The first few months of 2024 started well as mortgage rates edged down ahead of expected base rate cuts and a more stable political outlook,” MAB’s chief executive Peter Brodnicki said on Tuesday.
“When it became clear those cuts were not imminent, lenders adjusted their mortgage rates back up and the increased activity we saw started to tail off towards the end of Q1.
“Re-financing and purchase activity remained subdued for the rest of H1 ahead of the general election. Having now seen the first of a number of expected base rate cuts, activity levels are starting to gradually build again and we expect momentum to continue.”
MAB said its written new case numbers in July and August were up 11 per cent compared to last year and that it continued to trade in line with expectations.
It added that “this pick-up in activity” was expected to continue for the remainder of 2024.
“As expected, 2024 is shaping up to be a year of stability, following a highly challenging 2023,” the firm said.
“Our targeted investments in lead generation and customer retention put MAB in a strong position to capitalise on the growing market momentum, both in the latter part of this year and into 2025.”