Savills sees FY in line with expectations despite heightened uncertainty
By Michele Maatouk
Date: Tuesday 15 Jan 2019
(Sharecast News) - Savills said on Tuesday that underlying results for the year to the end of December 2018 should be in line with the board's expectations, but added that transaction volumes are expected to drop in a number of markets amid Brexit uncertainty.
The FTSE 250 real estate advisor said it experienced a robust closing quarter in most of its business lines, delivering growth in revenue and underlying profits for the full year despite heightened uncertainty through the last quarter as Brexit and US trade policy dented investor sentiment across the globe.
The UK delivered a "resilient" performance in the commercial transaction business amid relatively robust occupier demand and continued strong investment, particularly from the Asia Pacific region, although the market volume of trade was down on the prior year.
Meanwhile, the residential business continued to perform well, growing market share in challenging conditions, and the company's less transactional consultancy and property management businesses, in the UK and globally, performed in line with its expectations.
Savills said that its Asia Pacific and Continental European transactional businesses performed as expects, with particularly strong performances from Hong Kong, Singapore, Korea, Ireland and Germany.
In the US, it delivered significant growth in the occupier service business, which led to an improved performance overall for the year.
"Prospects for 2019 are overshadowed by macro-economic and political uncertainties across the world," the company said.
"It is difficult accurately to predict the impact of these issues on corporate expansionary activity and investor demand for real estate. At this stage, we expect to see declines in transaction volumes in a number of markets, the impact of which, to Savills, should be largely mitigated by growth in our less transactional business lines; accordingly we currently anticipate that the group's performance in 2019 should be broadly consistent year-on- year."
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