Savills half year results have revealed global turnover up by 15% to £714m and underlying profits were up 27% to to £32.4m.
But an otherwise glowing half year report by the company was offset by poor results from its UK operation, where underlying profits dropped by 27% to £5.4 million.
Its UK fee income dipped by 4% to £55 million down from £57.2 million and like many of its competitors Savills blames the surge of purchases before the additional Stamp Duty was introduced during 2016 for the lower volumes within the prime residential market compared to last year.
Other factors Savills blames include the political and economic uncertainty created by the General Election and Brexit which, it says “make it difficult to predict market volumes for the rest of the year”.
Savills said a weak April was offset by a stronger May and June compared to last year, although this is because those months last year were “muted” by the run up to the EU Referendum vote.
Within the UK prime property market the worst performing sector was new homes in which new development stock dropped by 6% and prices dipped by 4% to an average of £750,000.
This compares with the prime city resales market where transaction volumes dropped by 3% and country houses, which were 6% down.
Savills says the average sale price of Lonon houses it sold over the past half year was £2.7 million, up from £2.5 million last year and the average price for rural piles increased by £100,000 to £1.1 million.
But the UK performance was a distraction among other wise good results – Savills earns two thirds of its profits overseas and its successful Asian/Hong Kong business continues to deliver for the Group despite a lacklustre UK performance.
“Continued growth in our less transactional businesses, significant overseas earnings and strong market shares in many of our most important transactional locations position the Group to withstand short term reductions in local activity and to capitalise on the opportunities which we expect to emerge,” says Savills’ Group Chief Executive Jeremy Helsby (pictured, left).
“In an environment of ongoing political and economic uncertainty, we continue to anticipate that our performance for the full year will be in line with the Board’s expectations.”