Savills’ growth in revenue and profit in the first half of the year came from a push to expand the professional services side of the business, according to chief executive Jeremy Helsby.
The agent posted a 14% increase in revenue to £622.7m and 11.5% growth in underlying profits to £42.8m earlier this week, despite a 23% drop in UK commercial transaction revenue.
Income from UK transaction fees was down by 5%.
Helsby credited the company’s overall growth to its non-transactional business, which includes property and investment management and represents 56% of the firm’s income.
Revenue from investment management almost doubled in the first half of the year, rising from £14m in the first six months of 2015 to £27.5m this year.
Property and facilities management revenue grew by 23% from £178.4m to £219m.
Helsby said: “People don’t talk about those divisions as much as agency, but they are really important for us.
Key figures
-5% first-half year-on-year decline in UK transaction income
42% first-half year-on-year growth in continental european revenue
96% first-half year-on-year growth in investment management revenue
59% proportion of Savills’ revenue from outside UK
“There is investment going on in those businesses and you will see evidence of that in the next few months. They are less cyclical and more defensive.”
He added that revenue growth from other countries offset a slowdown in the UK.
Transaction fee income rose by 18% in continental Europe, 9% in the US, and 11% in Asia Pacific from the first half of 2015.
Helsby said: “Because we have such a large diversified business, we are able to withstand local challenges and profit from strong markets elsewhere in the world.”
In China, income from commercial transaction fees rose by 70% and underlying profits in residential more than doubled from £1.1m to £3m.
Simon Shaw, chief financial officer at Savills, said the company planned to focus on growth in North America, which now accounts for 15% of its revenue.
Shaw said: “We are continuing to invest significantly in the growth of the business. We are continuing to hire. We are continuing to look at bolt-on transactions in the US in particular, but also across continental Europe and even in the UK.”
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