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Savills

Savills expects 'tempering' of transaction volumes in 2018 amid Brexit uncertainty

Savills reported an 11% increase in revenue in 2017 thanks to a "highly resilient performance" in its UK residential business

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Savills lifted its total dividend for the year by 4% to 30.2p

Real estate agent Savills PLC (LON:SVS) said it expects a “tempering” of the recent strong transaction volumes in some markets this year amid geopolitical risks and rising interest rates.

The cautious statement was issued alongside its 2017 results, which showed an 11% increase in revenue to £1.6bn and a 3.5% rise in underlying profit to £140.5mln.

“The strength of our business in key transactional markets across the globe, including a highly resilient performance in our UK residential business, were key to this result,” Jeremy Helsby, who is stepping down as chief executive at the end of this year after 11 years in the role.

Helsby will be succeeded by Mark Ridley, the current head of Savills UK and Europe.

Revenues rise across most units 

Transaction advisory revenues edged up 13%, supported by strong performances in the UK and Asia Pacific regions.

Revenue in the consultancy business climbed 14% with growth across the UK, Asia Pacific and Europe.

The property management arm saw revenue increase 9% with a full year contribution from its acquisition of UK property consultancy GBR Phoenix Beard. 

In the investment management business, revenue fell 8% due to the liquidation of SEB German Open-Ended funds but assets under management gained 5% to £14.6mln.

Concerns over market uncertainty

“We have made a solid start to 2018 with a pipeline of business carried over from last year in many markets, although this is against the backdrop of heightened market uncertainty, geopolitical risks and rising interest rates,” said Helsby.

The housing market has slowed since the UK voted to leave the European Union while the Bank of England raised interest rates for the first time in more than a decade in November.

Savills lifted its total dividend for the year by 4% to 30.2p. 

Quick facts: Savills

Price: £9.14

Market: LSE
Market Cap: £1.31 billion
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