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Foxtons profits to slump after Brexit and stamp duty impact

Estate agent Foxtons has pencilled in a 46% collapse in 2016 profits after a downturn blamed on Brexit and the stamp duty hike.

Shares (Berlin: DI6.BE - news) in the London-focused group, which have fallen by half over the last year, dropped 6% on the worse than expected trading update though later partially recovered, trading around 3.3% off their opening mark by the close.

It came as figures from recruiter Page Group also signalled business uncertainty, while the World Bank forecast a UK slowdown though, separately, there were signs of optimism from small firms.

Foxtons, once a symbol of London's surging property market with its fleet of Minis and coffee-shop style branches, said it expected underlying earnings of £25m for 2016, down from £46m.

Revenues were down 11% to £133m after a sharp drop immediately after the first quarter.

Chief (Taiwan OTC: 3345.TWO - news) executive Nic Budden said: "Should current levels of sales activity continue in the short term, it is likely that 2017 volumes will be below those in 2016."

Central London property prices have fallen sharply in recent months after stamp duty changes in April hit demand for top-end homes, compounded by uncertainty after the EU vote in June.

Foxtons has previously blamed its downturn in fortunes on these factors, though it did not mention them in the latest update.

Meanwhile, white collar recruiter Page Group said its UK profits fell by 6.7% in the fourth quarter even as earnings for the wider group rose strongly.

The UK business was affected by economic uncertainty hitting employers' confidence.

The performance of recruitment firms can be seen as a bellwether for the wider economy - though separate figures from rival Robert Walters (LSE: RWA.L - news) this week showed an improvement.

Elsewhere, the Federation of Small Businesses (FSB) said confidence among its members had bounced back to pre-referendum levels.

FSB national chairman Mike Cherry said: "The current economic outlook seems brighter, and UK small businesses are ambitious and want to make the most of it."

The latest World Bank forecast pencilled in an improvement for global growth this year, but predicted UK expansion would slow from 2% in 2016 to 1.2% in 2017, pointing to Brexit uncertainty.