Savills makes first loss since 1992 after asset writedowns

Savills, the upmarket estate agent, has suffered its first annual loss since 1992 after the financial crisis forced it to write down the value of acquisitions and investments.

The company slashed its final dividend to 3p from 12p, halving the 2008 payout to 9p, and warned that 2009 would be "another challenging year".

Underlying pre-tax profits fell 61 per cent to £33.2m last year as UK residential business slowed dramatically. The prime central London property market fell 18 per cent, faster than the wider UK, as City bonuses dried up.

The £7.7m pre-tax loss was caused by £45.4m of writedowns on past acquisitions and investments in the property fund Cordea Savills.

Peter Smith, the chairman, said: "2008 was a difficult year which saw our markets deteriorate progressively with no region immune to the economic downturn. Globally, markets have continued to deteriorate and in the light of these difficult conditions the board is adopting a very cautious outlook for 2009."

Mr Smith said the company had cut £22m of costs last year, excluding reductions in staff bonuses. He said another £20m of cost cuts were planned for 2009. The bonus pool fell 47 per cent to £59.7m.

Jeremy Helsby, the chief executive, said big falls in house prices, combined with the sharp fall in sterling, would attract interest from cash-rich foreign investors this year. But a more widespread recovery would require an increase in the availability of mortgage credit along with a general restoration of economic confidence, he added.

In the US, investment sales slumped 87 per cent between the first quarter of 2007 and the final quarter of 2008, Mr Helsby said. In Manhattan, where prices are heavily geared to the financial sector, sales volumes dropped 93 per cent over the same period.

Mr Helsby said he would continue expanding in consultancy and property management businesses to reduce reliance on sales. Profits from transactions dropped 93 per cent to £3.2m, but consultancy profits fell 27 per cent to £16.3m. Property management increased profits 29 per cent to £14.2m.

"A return to higher levels of activity will depend on how quickly confidence returns to the financial markets. However, we remain well positioned to seize opportunities as and when they arise," Mr Helsby said.

Savills shares fell 8.7 per cent to 230p but are still up 2.8 per cent this year.

Start your day with The Independent, sign up for daily news emails
  • Get to the point
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Recruitment Genius: Claims Administrator

£16000 - £18500 per annum: Recruitment Genius: This is an excellent opportunit...

Recruitment Genius: Senior SEO Executive

£24000 - £28000 per annum: Recruitment Genius: A Senior SEO Executive is requi...

Recruitment Genius: Online Customer Service Administrator

£16000 - £18000 per annum: Recruitment Genius: An Online customer Service Admi...

Recruitment Genius: Digital Marketing Executive

£18000 - £22000 per annum: Recruitment Genius: This global, industry leading, ...

Day In a Page

'It was first time I had ever tasted chocolate. I kept a piece, and when Amsterdam was liberated, I gave it to the first Allied soldier I saw'

Bread from heaven

Dutch survivors thank RAF for World War II drop that saved millions
Britain will be 'run for the wealthy and powerful' if Tories retain power - Labour

How 'the Axe' helped Labour

UK will be 'run for the wealthy and powerful' if Tories retain power
Rare and exclusive video shows the horrific price paid by activists for challenging the rule of jihadist extremists in Syria

The price to be paid for challenging the rule of extremists

A revolution now 'consuming its own children'
Welcome to the world of Megagames

Welcome to the world of Megagames

300 players take part in Watch the Skies! board game in London
'Nymphomaniac' actress reveals what it was really like to star in one of the most explicit films ever

Charlotte Gainsbourg on 'Nymphomaniac'

Starring in one of the most explicit films ever
Robert Fisk in Abu Dhabi: The Emirates' out-of-sight migrant workers helping to build the dream projects of its rulers

Robert Fisk in Abu Dhabi

The Emirates' out-of-sight migrant workers helping to build the dream projects of its rulers
Vince Cable interview: Charging fees for employment tribunals was 'a very bad move'

Vince Cable exclusive interview

Charging fees for employment tribunals was 'a very bad move'
Iwan Rheon interview: Game of Thrones star returns to his Welsh roots to record debut album

Iwan Rheon is returning to his Welsh roots

Rheon is best known for his role as the Bastard of Bolton. It's gruelling playing a sadistic torturer, he tells Craig McLean, but it hasn't stopped him recording an album of Welsh psychedelia
Russell Brand's interview with Ed Miliband has got everyone talking about The Trews

Everyone is talking about The Trews

Russell Brand's 'true news' videos attract millions of viewers. But today's 'Milibrand' interview introduced his resolutely amateurish style to a whole new crowd
Morne Hardenberg interview: Cameraman for BBC's upcoming show Shark on filming the ocean's most dangerous predator

It's time for my close-up

Meet the man who films great whites for a living
Increasing numbers of homeless people in America keep their mobile phones on the streets

Homeless people keep mobile phones

A homeless person with a smartphone is a common sight in the US. And that's creating a network where the 'hobo' community can share information - and fight stigma - like never before
'Queer saint' Peter Watson left his mark on British culture by bankrolling artworld giants

'Queer saint' who bankrolled artworld giants

British culture owes a huge debt to Peter Watson, says Michael Prodger
Pushkin Prizes: Unusual exchange programme aims to bring countries together through culture

Pushkin Prizes brings countries together

Ten Scottish schoolchildren and their Russian peers attended a creative writing workshop in the Highlands this week
14 best kids' hoodies

14 best kids' hoodies

Don't get caught out by that wind on the beach. Zip them up in a lightweight top to see them through summer to autumn
Robert Fisk in Abu Dhabi: The acceptable face of the Emirates

The acceptable face of the Emirates

Has Abu Dhabi found a way to blend petrodollars with principles, asks Robert Fisk