Transactional market recovering, says Savills

International property advisor Savills, which employs 120 people in Manchester, reported increased revenue and profit in the first half of the year with strong performance in its UK business in particular.

Group revenue increased 23% to £304.4m (H1 2009: £247.6m) and pre-tax profit was £14.4m, up markedly from £100,000 in the same period last year.

There was no breakdown given for performance in the North West. The interim statement issued to the stock exchange said overall UK commercial fee income increased by 38% to £19.2m (H1 2009: £13.9m) "reflecting the stronger investment market, particularly in Central London…a continuation of the recovery experienced in the last quarter of 2009."

UK Residential fee income also increased, by 44% to £39.2m (H1 2009: £27.3m), "reflecting a very strong first quarter followed by a slightly subdued market around the General Election and subsequent Budget".

Jeremy Helsby, group chief executive of Savills, said: "We have had a strong first half particularly through the recovery of transaction markets in the UK and Asia Pacific, which are core to the Group's success. At the same time we have substantially reduced losses in the Continental European business and are seeing some improvement in the US market.

"Looking to the second half, factors such as the Chinese Government's desire to contain overheating in the residential market, continued concerns over economic growth in many countries and prolonged low levels of debt availability indicate that the recovery is likely to flatten off during the coming months. Since Q4 2009 we have consistently maintained a cautious outlook for the second half of 2010, and with such uncertainties remaining we currently have no reason to change that view.

"Over the last two years we have successfully restructured and re-positioned Savills businesses to address the market conditions that they face, and we are now well placed to take advantage of business opportunities as they arise."

A small amount of outstanding debt was wiped out during the first half and Savills now has net cash of £20.1m. An interim dividend was recommended of 3p a share.