Savills’ pre-tax profit for the financial year ended 31 December 2023 slumped 64% to £55.4m and its revenue slipped 3% to £2.2bn.
The decline was largely due to a 17% decrease in global transactional advisory revenues. The group said its UK commercial transactional revenue fell 15% to £100.6m as a result of fewer investment transactions and “more subdued leasing activity”.
Revenue derived from UK residential transactions fell 18% to £171.0m, while revenue at Savills Investment Management fell 6% to £105.8m.
However, the group’s UK property management business grew its revenue by 9% to £355.7m and its UK consultancy business also saw its revenue grow, by 9% to £271m.
The company said it anticipated improved volumes of activity in 2024 as the UK prime commercial market re-priced to a point where it “represents value, particularly for assets with strong sustainability credentials, for which there is significant occupier demand”.
Mark Ridley (pictured), group chief executive of Savills, said: “Savills’ resilient performance in 2023 highlights the diversity and strength of our global business. In the context of extremely challenging real estate markets, which saw the lowest levels of transaction volumes for a decade, our less transactional businesses have provided a solid platform for the group with a resilient and growing earnings stream.
“Current economic and geopolitical conditions remain uncertain and although we expect this to continue for some time, most markets appear to be past the moment of peak uncertainty. There are some early signs of underlying market improvements, which should set the course for a broader recovery during the second half of the year and into 2025. Our policy of retaining our core bench strength, enabled by our strong balance sheet, positions the group well for the future.”
