Property advisory group DTZ Holdings warned on Wednesday that its UK and US operations have been hit by the credit crunch and are unlikely to recover in the short term. The company saw its share price drop by more than 12% following the warning which it put down to economic uncertainty and 'very low levels of activity' in the investment market.
Property advisory group DTZ Holdings warned on Wednesday that its UK and US operations have been hit by the credit crunch and are unlikely to recover in the short term. The company saw its share price drop by more than 12% following the warning which it put down to economic uncertainty and 'very low levels of activity' in the investment market.
Chief executive Mark Struckett said early analysts' forecasts pointed to a 'small reduction' in estimated full-year pre tax profits. Tim Melville Ross, DTZ chairman, said: 'We are unlikely to see a recovery in these markets during the current financial year and indeed the impact may be spreading to Continental Europe.' Melville Ross added that difficult investment market conditions have pressured margins and that the company expected full-year results to reflect the challenging conditions.
In its results for the six months to 31 October, DTZ saw revenue (excluding acquisitions) climb 23% to £157 mln (EUR 218.6 mln). Adjusted pre-tax profits, excluding sales and purchases, were flat at £12.5 mln (EUR 17.4 mln).
The interim dividend was unchanged at 3.5p, and Struckett said he did not expect dividend forecasts to be reduced, but adjusted earnings per share fell 24% to 11.3p.
Struckett added that he did not expect prices to continue to fall for much longer in the investment market, which makes up 26% of the company's revenue. 'I think the reaction to the shock has been rapid and that speed means that it will probably be a short sharp shock.'