A diverse revenue stream once again worked well for Savills (SVS) and helped to push underlying profits ahead by 12 per cent to £48.1m in the first half. Transaction advisory business accounted for just under half of that, its contribution up by 6 per cent year-on-year to £24.6m, helped again by strong performance in the Asia-Pacific region. This helped to offset lower profits in North America as a result of continued investment.
UK commercial transaction fee income grew by nearly a quarter to £39.4m, underlining the strength of the commercial property market, despite the Brexit uncertainty, as overseas investors remain interested. On the residential side, fee income was down just 4 per cent at £55m as a result of some tough comparatives and a continued decline in transactional volume.
Asset disposals boosted underlying profits by two-thirds on the investment management side leaving assets under management down by 6 per cent at €16bn (£14.4bn), despite an €800m net inflow of funds. Elsewhere, consultancy fees grew by 12 per cent in constant currency terms to £121m, underpinned by a 20 per cent jump in Asia-Pacific revenue and a 13 per cent increase in the UK. These more than offset a 12 per cent constant-currency decline in mainland Europe.
Analysts at Peel Hunt are forecasting adjusted pre-tax profits for the year to December 2017 of £137.5m and EPS of 66.6p (2016: £135.8m/72.3p).
| SAVILLS (SVS) | ||||
| ORD PRICE: | 924.5p | MARKET VALUE: | £ 1.31bn | |
| TOUCH: | 923.5-924.5p | 12-MONTH HIGH: | 961p | LOW: 637p |
| DIVIDEND YIELD: | 1.6% | PE RATIO: | 17 | |
| NET ASSET VALUE: | 269p* | NET CASH: | £1.4m | |
| Half-year to 30 Jun | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
| 2016 | 623 | 25.5 | 11.6 | 4.4 |
| 2017 | 714 | 32.4 | 16.1 | 4.65 |
| % change | +15 | +27 | +39 | +6 |
| Ex-div: | 07 Sep | |||
| Payment: | 04 Oct | |||
| *Includes intangible assets of £343m or 242p a share | ||||
