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UPDATE 1-Savills reports 27 pct rise in H1 profit led by Asia
August 10, 2017 / 7:13 AM / a month ago

UPDATE 1-Savills reports 27 pct rise in H1 profit led by Asia

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Aug 10 (Reuters) - International estate agency Savills reported a 27 percent rise in first-half profit on strength from Asia and its real estate investment management arm, despite a post-Brexit decline in demand for new homes and office space in London.

The company, which gets nearly two-thirds of its revenue from outside the UK, said underlying profit rose to 32.4 million pounds ($42.05 million) for the six months to June 30, from 25.5 million pounds a year earlier.

Revenue rose 15 percent to 714.4 million pounds, the company said. It raised its interim dividend by 6 percent to 4.65 pence.

Its shares were up 3.6 percent in early trade.

The company said it expected full-year performance would be in line with expectations, although highlighting that it continued to trade in an “environment of ongoing political and economic uncertainty”.

It said the measures taken by the Hong Kong government to cool its property market were likely to impact volumes in the second half, while the British residential market continued to face uncertainty in the aftermath of the Brexit vote.

“In May 2017, the Hong Kong government implemented further cooling measures which are likely to have an impact on volumes in the second half of the year,” the company said in a statement.

Savills said income from residential transactions in Asia increased by 23 percent to 20.1 million pounds, driven by 84 percent sales growth in Hong Kong.

Underlying profits from its British residential transaction business fell by 27 percent to 5.4 million pounds.

Overall, however, Savills’ UK business reported a 7 percent rise in revenue as strength from its consultancy services offset the impact of reduced volumes in its residential business.

The UK housing market, which has slowed since the EU referendum, has been further hit by a rise in stamp duty charges and an uncertain outcome in the June national election.

$1 = 0.7706 pounds Reporting by Justin George Varghese in Bengaluru; editing by Jason Neely

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