Savills, the international property services company, provides the following trading update for the half-year, prior to the interim results for the first half of 2006, which are scheduled for release on 5 September 2006.
Overview
At the time of our Annual General Meeting the Chairman reported that the Group had, overall, performed in line with our expectations and ahead of the corresponding period last year.
The current position is set out below:
Main Business Streams:
Transactional
The commercial property investment market throughout the UK remains strong and the first half has seen a continuing high level of transaction volumes. There is continued high demand for property from private and institutional buyers both in the UK and overseas. Tenant demand in both London and the regional commercial markets is improving.
Residential markets have been particularly buoyant in London and had a much stronger first half than was the case in 2005, although we do not expect this trend to continue into the second half.
In Asia, the commercial investment markets have showed signs of slowing, due to rising interest rates. In key European markets our investment teams are performing well.
Consultancy
Our Consultancy business has performed well. The demand for property services remains high and we have continued to expand and develop our professional teams, particularly in the areas of valuation and planning.
Property Management
The UK and European commercial property management business has benefited from organic growth, acquisition and key recruitment. In Hong Kong and China we have also increased the size and scope of our property and facility management business.
Financial Services
Our private client financial services business continues to perform well.
Fund Management
Having built on its existing infrastructure, Cordea Savills' funds under management continue to grow steadily.
Outlook
The first half has seen strong investment markets especially in the UK and in key European markets and this should ensure that commercial activity levels remain high in 2006. Residential markets have been buoyant in the first half of 2006. While our order book remains stronger than last year, we have some caution that the residential markets may not be as buoyant in the second half. The Board is, therefore, currently of the view that the Group is well placed to deliver full year results in line with our existing expectations.