Savills Regulatory News (SVS)

6 May 2009 12:00

6 May 2009

SAVILLS PLC

("Savills" or "the Company")

AGM Statement and Interim Management Statement

Savills plc, the international real estate advisor, is today holding its Annual General Meeting (AGM) at 12 noon, 20 Grosvenor Hill, Berkeley Square, London W1K 3HQ and provides the following Interim Management Statement (IMS) for the period to the end of April 2009.

Overview 

When we announced our results for the year ended 31 December 2008, the Chairman reported that globally, markets continued to deteriorate and in the light of these difficult conditions the Board was adopting a very cautious outlook for 2009. A return to higher levels of activity would depend on how quickly confidence returned to the financial markets. 

During the period to date there has been little change in market conditions and as yet no evidence of any sustainable improvement. Whilst our businesses overall have performed creditably, the Board continues to maintain its cautious outlook for 2009. We are continuing to reduce costs in line with our forecast, and the balance sheet remains strong, which positions us well to seize opportunities as they arise.

UK 

Commercial

Trading conditions for our Commercial Transactional business remained difficult. Investment markets have seen a slight improvement in activity although this has yet to translate into transactions. Occupational agency markets continued to be tough, particularly in the London office market, where reduced demand resulted in falling rental values. Within retail, rents have continued to fall and the number of retailers actively opening stores has been largely limited to the food and discount end of the market.

Our Commercial Consultancy business has continued to perform well with good pipelines for building and valuation. Lenders have been assessing their loan books to establish true values and consider appropriate action in respect of exposures across their portfolios, however, as yet, there has been little evidence of forced sales. Our Property Management business has continued to perform strongly during the first quarter although we are starting to see margin pressure. 

Residential

Our Residential Agency business has noted an uplift in interest from cash buyers which, in March, resulted in an increase in transactions, albeit off a low base in January and February. Shortage of stock remains an issue, and it will take another quarter to establish whether the March upturn is evidence of a sustainable improvement, or an anomaly in a weak market.

The Residential Consultancy business has performed creditably in the first quarter albeit with some teams seeing a reduced order book for the remainder of the year.

Other businesses

Our Financial Services businesses, SPF, Savills Capital Advisors, and the fund management business, Cordea Savills, have suffered declines in revenue, as anticipated.

Europe

In continental Europe, we have continued to cut costs in the face of weak transactional markets and the first quarter's trading was in line with our expectations. The outlook across Europe remains weak, with particular uncertainty in Ireland where we have continued to cut costs. On the positive side, our businesses in Germany and the Netherlands have started the year well.

Asia

Across most of Asia institutional buyers have remained largely on the sidelines with few transactions being reported. Private buyers have shown some appetite for acquisition, often at heavily discounted prices. Our Consultancy businesses are less affected but remain constrained by the lack of capital markets activity. 

Our Property and Facility Management business remained strong and its size and local nature continues to represent a significant strength for our business throughout the transaction cycle. We are continuing to grow this business organically in China.

US

In the US, transaction markets have remained largely illiquid through the lack of capital market activity. Despite market conditions, we have won several high-quality mandates and have successfully completed some transactions.

For further information, contact:

Savills 020 7409 8844

Jeremy Helsby, Group Chief Executive 

Simon Shaw, Group Chief Financial Officer

Tulchan Communications 020 7353 4200

John Sunnucks

Forward looking statements

Certain information included within this statement is forward-looking and by its nature involve risks and uncertainties because it relates to events and depends on circumstances that will occur in future. 

Forward-looking statements include, without limitation, projections relating to results of operations and financial conditions, market estimates, the Company's plans and objectives for future operations, including future revenues, financial plans and expected expenditures and divestments. 

There are a number of factors which could cause actual results and developments to differ materially from those expressed or implied by these forward looking statements including a number of factors outside the Company's control. All forward-looking statements in this report are based upon information known to the Company on the date of this IMS. The Company gives no undertaking to update forward looking statements whether as a result of new information, future events or otherwise.