(Reuters) - Shares of Purplebricks lost over a third of their value on Thursday after the British online estate agent cut its full-year revenue forecast and warned that revenue from the United States and Australia would not meet its expectations.
The online broker said it expects to report fiscal 2018-19 revenue between 130 million pounds and 140 million pounds. It had earlier forecast revenue to be between 165 million and 175 million pounds.
Britain's Purplebricks had trimmed the upper end of its revenue forecast in December, citing a challenging UK property market on the run up to the country's planned departure from the European Union.
Purplebricks' shares were 38.2 percent lower at 101.8 pence at 0833 GMT and were heading for their worst day on record.
"Clearly (again) a disappointing update by the company which underlines that visibility remains low and trading is volatile," JP Morgan analysts said.
Many companies in the British property sector have faced heavy losses due to higher property taxes, Brexit and lower household spending, pinched by inflation that has risen faster than pay.
Purplebricks, however, has enjoyed revenue growth, helped by its low-fee model of local experts who provide valuations and online systems that handle selling and buying of properties. It has won market share from Britain's big incumbent operators such as Countrywide and Foxtons (LON:FOXT).
The company - whose biggest investor is one of Britain's best-known fund managers Neil Woodford - has moved into the United States and Canada and had also recently pushed into Germany via a joint venture with publisher Axel Springer, its third biggest investor.
Purplebricks said on Thursday that the UK housing market has continued to be challenging for the estate agency industry, but it still expects to report about 15-20 percent higher UK revenue in the year ending April 30.
Purplebricks said it had made positive changes in its operating model in Australia towards the end of 2018, with a new leadership team in place, but warned the anticipated amount of recognisable revenue would not be sufficient to meet expectations.
It added there had been a slower than expected response to a marketing initiative in the United States, adding that most of its short-term investment would be focused on the Los Angeles and Florida markets.
The company also said that its UK Chief Executive Officer Lee Wainwright and U.S. CEO Eric Eckardt would leave the company.