A bank’s City analysts have upgraded Countrywide to ‘hold’ despite the fact that the estate agency group’s share price rose just 0.4% yesterday, closing at 100.4p, following news yesterday morning that Alison Platt had resigned as the estate agency group’s chief executive.
Meanwhile, it emerged that Platt is in line for a six-figure pay-off following her decision to step down from the board.
Platt will receive a total of £674,450, which represents her normal remuneration payment in terms of salary, salary supplement in lieu of pension entitlement and car allowance.
She will not receive any bonus in relation to the firm’s financial years ended December 31, 2017 or December 31, 2018.
Nor will she receive any payment for loss of office.
She also gets a capped contribution of up to £5,000 towards legal fees in connection with her departure, according to a document published by Countrywide yesterday.
Meanwhile, the shares granted to her under Countrywide’s long-term incentive plan (LTIP) in 2015 have lapsed.
The LTIP options granted to her in 2016 and 2017 (over a total of 788,060 shares) will lapse on the termination date.
Countrywide also left open the possibility that if Platt exercises her share options, they are subject to the remuneration committee’s right under its Deferred Share Bonus Plan to “apply malus and clawback provisions”.
Countrywide’s latest annual report, published in March last year, showed that Platt received a base salary of £575,000, with no increase in 2017.
Platt’s departure, long predicted, came as an unscheduled trading update, in which she was not quoted, warned Countrywide’s profits would be below expectations.
The share price briefly dropped below the 100p mark on Tuesday.
Any hopes that Platt’s resignation would provide an immediate tonic were dashed, though. Although the share price briefly hit 106.4p during the day, it closed more or less where it started, up to just 100.4p from 100p.
Nonetheless, the news was enough to persuade German bank Berenberg to upgrade Countrywide from ‘sell’ to ‘hold’.
Analysts at the bank recommended keeping a watching brief until Countrywide’s preliminary 2017 numbers are released to the market on March 8.
They said: “We suspect there will be additional strategic announcements. We can only speculate how deep these will be, but if Countrywide can find room for investment to improve its competitive positioning, invest in technology to reduce the cost to deliver its core sales and lettings business, and come up with a reasonable digital strategy, brighter days could be ahead.”
In a note circulated to staff yesterday, executive chairman Peter Long said he had confidence in the group and its future and that Countrywide would hand power back to the branches to revive the business.
He said: “Our branch management will be empowered and given the resources to restore our lost market share.
“There is no doubt that we are operating in a challenging market environment but we have real strengths across the group. The diversity and breadth of operations we have means that with the correct focus we can once again be a winning company.”
Long will continue in his role as executive chairman until a successor to Platt has been appointed. Meanwhile, Paul Creffield has become group operations director with immediate effect.