Savills boost as property firm taps UK market gains
Property firm Savills tapped a late year-end surge of business following the British general election as it reported an improved profits update.
Shares in the international firm climbed 5.5% after it said confidence had returned to the British market -- in both residential and commercial -- following the decisive election outcome.
It had also largely weathered the effects of the political protests in Hong Kong which had weighed on property transactions there.
“Savills has shown considerable resilience in a year which exposed the group to significant challenges in the UK and Hong Kong, two of our key markets,” it said in a year-end trading update, projecting its annual underlying results would be at the upper end of its expectations. The firm is due to report its 2019 earnings in March.
Savills, which works across the Americas, Europe, Asia Pacific, Africa, and the Middle East, said in August that uncertainty due to the US-China trade dispute and Brexit led to fewer commercial transactions in Asia and Britain.
“Thanks largely to an excellent performance in the UK, significant year-on-year growth in the US and a strong performance from Savills Investment Management, the Group anticipates that underlying results for the year to 31 December 2019 will be at the upper end of the Board’s expectations,” it said.
Despite the backdrop of uncertainty, the UK performed well across all business lines, latterly benefitting from improved investor sentiment in both commercial and residential markets.
"Our residential business continued to outperform the overall market conditions, in particular taking share in the core London market,” the company said.
And while political unrest in Hong Kong continues to weigh on the market, “the strength of Savills positions in both markets contributed to a resilient performance through increased market share, despite lower volumes of activity generally”, it said.
Meanwhile, continental Europe delivered results as expected, with fewer transactions in some markets, while North America performed well.
Savills shares have rebounded in the past year to value the firm at over almost £1.75bn (€2bn).
