Savills upgrades profit guidance as property sales surge

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Savills has significantly raised its profit forecasts after realtors rushed to buy expensive homes and warehouses late last year.

The FTSE250 company, which sells residential and commercial real estate worldwide, will benefit from “very strong” activities in the last seven weeks of 2021 and lower pandemic-related travel and entertainment costs on Wednesday. Said received.

Without clarifying expectations, 2021 pre-tax profit was “much more advanced” than previous guidance when reporting its March results.

Peelhunt analysts suggest that the latest transaction information could raise pre-tax profits in 2021 well above expectations, 33% above the £ 143 million reported in 2019. Said that.

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With the announcement, the company’s stock rose 3.4% to 13.65p.

With the demand for logistics facilities The warehousing industry has skyrocketed worldwide Last year, investment reached record levels amid the e-commerce boom and supply chain turmoil.Demand for luxury homes English countryside It also boosted Savills.

“In some sectors and markets, the blockage can cause a surge. Mark Ridley, Chief Executive Officer of Savills, said:

“The segment I would like to emphasize is UK housing. Transactions over £ 1m increased by 60% in 2019,” he added. “It’s a surge. I’m hoping it will normalize.”

According to Savills, investment activity was fully strengthened in the last few months of 2021 as uncertainties about the pandemic began to rise.

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So far, according to Ridley, the epidemic of the Omicron variant of coronavirus has not significantly reduced activity.

“Omicron has delayed activity in closing the deal … But when it comes to decision making, no one has seen it stop and pause,” he added.

However, demand from companies undertaking new office leasing, Savills’ core business, remained below historical averages. The group warned that trading frenzy could ease this year.

Realtor Winkworth also raised earnings and profit expectations on Wednesday because of the lasting strength of the UK housing market, even after the government withdrew its stamp duty vacation in September.

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The number of real estate sales agreed by the company last year exceeded Bumper 2020 by 13% and increased by 42% in 2019.

Dominique Agase, Chief Executive Officer of Winkworth, said:

Savills upgrades profit guidance as property sales surge Source link Savills upgrades profit guidance as property sales surge