Savills Plc Ord

Good morning everyone, welcome to Margaret Street and thank you for joining us this morning despite the hot central line for some people. My name is Simon Shaw, CEO and I'm joined by Nick Sanderson, our Group Chief Financial Officer and today I'm actually delighted to be reporting on a very strong first half for Savills and also to really recognise the fact that we're at an inflection point, a genuine inflection point for this business having completed the Eastfield Secured Saddles transaction two weeks ago. So we'll probably spend a bit of time on both of those today. I hope that's changed. Yes, it has. The format for today is pretty standard. I'll take you through the highlights of our performance during the first half. Nick will take you through the financial details.

And I also want to spend a little time looking at the context for our performance, which you'll see in a moment is very important.

I'll then remind you of the strategy which we talked about back in March and together with some of the steps we've taken both in business firms down the line of saddles but also really still secure saddles. And then we'll try and do a bit of crystal ball gazing for 2026 as a whole.

So let's crack on.

This is a very strong set of results. in conditions that were far from easy in many of the markets in which we operate, so I'm particularly delighted with them. You can see from the chart on the right of this slide that all the major metrics are moving in the right direction, and this is essentially driven by three factors. First of all, our transactional business generally improving, which was, and I'm particularly glad to see, significantly assisted by a strong performance in our North American occupier-facing leasing market, but our capital transaction business also significantly improved, despite the fact, and this is important, you'll see in a minute, that we had very, very little exposure to the driver of world capital transaction volumes in the US market during the period. Secondly, our less transactional grew as we anticipated and you'll see later on with significant improvement to the bottom line. And finally, and these two are connected actually, we started to see the benefits of our cost-saving initiatives from last year. We've also worked hard to broaden and deepen our bench during this period with some key recruitment and team leads. And of course, Eastall Secure Saddles joined the group at the 31st of July you'll see later that they actually unsurprisingly had a very strong first half too and I'll talk a bit about what we're doing in terms of integration etc. Finally on this slide reflecting our confidence and the normal operation of our ordinary dividend we declared an interim dividend of 7.8p up 5.5% or so year on year. So let's start by looking at the capital market context for our performance. So what these charts show is the 12-month rolling investment market volumes quarter by quarter since 2020. And the reason we do that, it's the best way to minimize background noise and seasonality from the data. And what you'll see during the last six months from the top left is that global volumes were recovering nicely up 18% half year on half year. And if you look to the top right, you can see that the US market has driven that global growth. You'll have also picked that up from the results of our peer group companies with large exposure to the US over the last couple of weeks or so. And bear in mind that the US capital market represented 60% of global volumes. and it grew by 24% half year on half year and remember we had next to no exposure to that market during the first half of 26. Thankfully we've got Easter in the house now. APAC and EMEA were markets that performed slightly differently and they're markets where our traditional investment agency strength lies. So what you see from the bottom left is APAC

coming back nicely but from a low base and critically sentiment in EMEA really for obvious reasons was affected by its nature as the most hydrocarbon import dependent market on the planet for obvious reasons that's caused a lot of issues over the course of this period so the three conclusions to draw from this slide are that number one market share gains

in our markets outside the U.S. has enabled us to perform as well as we did do during the first half in some difficult conditions. Number two, it's self-evident why we desire the quality exposure to the U.S. that these deal-secured tables provide us. And finally, this is an implication rather than a verse on the side, the resilience and profitable growth of our less transactional business has been and will remain usually important to the performance of our organisation overall, both in terms of our client service and our financial performance. So with that in mind, let's have a quick look at the revenue highlights. So in these cover slides, I'm going to focus on revenue. Nick will talk me through profitability, but you'll see that every business line has improved during this period on bottom line. Across the board in our transactional business, it is a story of gains in market shares, enabling us to perform as we have and show the growth in revenues that we have.

We start with the commercial transaction business.

Revenues up 19% overall with capital transactions up 22% well ahead of market in what was described in Q2 as a delayed not destroyed continuation of recovery in EMEA in particular. Of note with UK growth of 17% against a market where volumes actually declined by 12% half year on half year. Very strong performance. In APAC, it was again a market share story with our business development activities of last year starting to come good in Australia during the ramp-up phase. And importantly, the market in Greater China beginning to turn more positive, again, off a low base. Finally, we saw different levels of market recovery across continental Europe, with, broadly speaking, the further south you get, the better, the further north, the more compromised. And our occupier advisory business, particularly in the US, very strong, 23% growth in revenues year on year, which is really good to see.

And Nick will talk a bit more about the profitability improvement in due course.

Residential was more mirrored. when revenues up 3% overall and this is a very good performance in some tricky market conditions and particularly given the largest part of our residential business being the UK was down 9% and Nick will talk about the impact of the Renters Rights Act in a moment because that's the predominant reason for that decline the brightest was our secondary sales or conventional estate agency if you will where we saw growth of 2% again is driven against declines in market volumes but increase in our market share of transactions above £5 million. Finally, the Middle East was up 34% on a very strong first quarter before conflict escalation constrained new development sales from Q2. But one thing I will point out here is we've seen no evidence to date of expat repatriation from the region, which is important as we look forward. So let's turn to our less transactional lines. Here you'll see significant in due course growth from these, profit growth from these businesses in a moment. But if we start with PM and FM, we saw revenue growth in line with our long-term expectations of mid to high single digits. And that is net of the impact of last year's restructuring in China, which reduced revenue. For your notes, it's about 170 basis points of reduction in revenue simply through stat restructuring, but improved profits. Elsewhere, we're winning new business across EMEA and in Asia Pacific and broadening the client offering in Singapore. where we're pushing into government-mandated integrated facilities management contracts, much aided by the acquisition of Alpena in that market last year. MEIT Consultants is a small business, but I put it there and referenced it because it brings critical M&E and environmental engineering capability into the data center sector for us in India. Moving on to our consulting business it grew revenue by 2% with strong valuations and building consultancy contributing in EMEA and the successful integration of our move and change management business Hoffman in the US. These were offset at the revenue line by a significant reduction in project management pass-through costs in India so zero profit impact but again another reduction in revenue. and the impact of last year's restructuring in China as well. China has a small impact on the rolling blind here.

Again, positive impact on profits.

I should note that in many of these consultancy lines, we are beginning to benefit significantly from investment in data curation and digitization. Finally, Sandwell's investment management grew revenues by 8%. Despite a still very challenging capital-raising market across EMEA, and it was higher transaction fees and asset management fees that drove that growth. We've also made some management changes in that in both Europe and Asia and now working on the next five year plan for that business. All in all our less transactional businesses performed well and really anchored the performance of the group overall. So I'll now turn to our newest family member he's still secured which obviously didn't affect our the whole history this is not other than that we have to recognize some of the costs of acquisition it before so the first half momentum both in revenue and in pipeline evidence why we are so excited about this combination the mix of revenue was well balanced roughly 60% equity related 40% debt related and I would draw your attention to to the fact that actually that debt advisory business is the East Steel Secured Savills equivalent of the recurring revenue line, which is important to us as we go forward. I'd also draw your attention to the fact, as you can see from the chart below, that East Steel Secured Savills was number one in the US public M&A market advisory league table during this period. which was an exceptional performance in both senses of that word, exceptional. So don't expect that necessarily to continue through the second part, but it's great to see it. And it definitely helped drive their revenue growth in the US up 33% versus the European revenue growth up a healthy 23% during the period. Obviously H1 was pre-acquisition and therefore doesn't directly benefit saddle shareholders during the period. What I do think it does do, though, is it underpins the rationale, structure, and ultimately the board decision to go ahead with that transaction when we did. So if you hold that thought, I'll hand over to Nick to take you through the detail that I've had.

Thank you, Simon. Morning, everyone. As you reckon, Simon, hot summer's day, very impressed to see a few ties in the room, and actually no shorts from flies. So let's turn to the headline results, where the group has delivered strong earnings growth, driven by an increase in revenue, along with positive margin progression. Revenue of more than £1.2 billion is up 8.7%, predominantly organically generated, with underlying EBITDA of 32% to almost £74 million. Underlying PVT at £34.3 billion is up 47%, or almost 49% on a constant currency basis, delivering underlying EPS This strong EPS growth means the interim dividend has again been increased as to rates well ahead of inflation with a 5.4% uplift delivering a payout of 7.8 pence per share. And as you can see, we ended the period with net debt of less than £50 million, although we moved back to a net cash position at the end of July, ahead of completion of the Easter acquisition. As you heard from Simon, revenue growth was delivered across all Saddle's main business areas, including transactional revenues up 14% overall, driven by a strong commercial performance, particularly in North America, offsetting some of the headwinds in a near residential. Less transactional revenues again rose up 6%. Overall, less transactional revenues of £776 million represented 63% of group total revenues, a critical component of Savile's diversified and well-balanced business model. And as you can see bottom right, the consistent revenue growth delivered by the group over the last four years is up by more than 20%. This strong performance delivered not only revenue growth, but also a significant increase in underlying profit before tax too, which was up 47%. There was a significant reduction in first half losses on the commercial transactional side, driven by improved performances, notably in the US, Hong Kong, Germany, Italy and the UK. The group also benefited from the inherent operational leverage within the business. Residential advisory activities delivered a profit of £2.1 million. Although this was down from last year, principally due to the one-time negative income recognition effects of the imposition of the Renters' Rights Act in the UK. First half profits on the less transactional side were up 28% to £42.2 million, with a particularly strong uplift of 74% on the consultancy side, largely resulting from the restructuring activities last year in China and strong progress year to date in North America. The property and facilities management business delivers another resilient performance and the group continues to focus on lifting the investment management margin. So with first half underlying profits of £34.3 million, you can see in the bar chart that margin growth in the Benson continues to build across the business, one of the group's key strategic priorities. Equally, this improved level of profit came through across all of the group's regions, with the smallest uplift but highest profits coming from EMEA, where an improved performance on the continent was largely offset by lower UK residential profits. APAC performed strongly, delivering a 75% increase in profit, driven by a strong capital markets performance and cost-saving measures in China. and following our targeted investments in the region, particularly in Australia and Japan, there should be more profit in coming periods. And North America generated a profit of £2.6 million, a positive £9 million swing year on year, driven by both our transactional and consultancy activities delivering positive margins. On the occupier leasing side there was an increase in larger office deals and overall pipelines for the second half were strong across both office and industrial. So pulling this all together with the group's customary reconciliation of underlying profits to IFRS reported profits. There are two key points to highlight alongside the more detailed reconciliation included in the appendices. Firstly, the £7.2 million of restructuring costs includes the previously guided £3 million overhang from last year's restructuring activities, with the balance linked to further rightsizing of certain service lines, predominantly in APAC and on the continent. And for the second half, a similar quantum is expected as the Group completes its strategic restructuring activities, including some Eastfield-related integration costs, which, as you would expect, are predominantly in Europe. In total, the four years restructuring and integration costs are likely to be around half of last year's $30 million charge and are expected to benefit the group's profits and margin in future years. Secondly, the $13.5 million in transaction costs includes professional advisor fees related to the Eastfield purchase. and following successful closing of the deal, the balance of the advisory costs and fees associated with the acquisition mean group transaction costs are expected to be higher in the second half than the first. So whilst the group's profits are consistently second half weighted, this has been a strong first half for the Sattles team with underlying EPS up 53%. and we are pleased to report the same for our new colleagues at Eastill Secured Saddles II who had a particularly strong first half. You can see in the second column Eastill's H1 revenues were £225 million with US$302 million Simon referred to earlier. This delivered an underlying EBITDA of £38.4 million for the six months presented on the same US GAAP basis as Eastville's £84 million EBITDA for the full year 2025 that was disclosed back in March. Further down the page, you can see that this EBITDA of £38.4 million would translate into an illustrative estimated underlying PVT of £37.8 million, or margin of 17%, post conversion to IFRS and adjusting the depreciation of other items. This underlying profit is presented on a consistent basis with the saddle standalone underlying PVT including adjustments for the amortization expense relating to the historic one-time Eastfield SIP put in place in 2025. As disclosed on purchase the five-year SIP results in a non-cash annual charge of around £30 million, or £15 million each six months, which will continue to be reflected in reported profits until maturity in 2030. To give you a sense of the pro forma group profitability pre-synergies, we've combined the standalone East Dillon Saddles at H1 performances, along with the expected initial interest expense associated with the $800 million acquisition financing, which should of course fall over time as the debt is paid down from free cash flow. So taken together on a pro forma illustrative basis, the combination would have increased the H1 Group UPVT by £21 million to £55 million, an uplift of 60%. This reaffirms the board's view that the combination should not only deliver better client outcomes, but also meaningful earnings accretion and strong returns for shareholders too. So looking ahead to the full year 2026 numbers for the enlarged group, which will include Eastill's contribution from August through to December. With Eastill historically having a much less skewed profit weighting to the second half than Saville's standalone, Current expectations are for a 5 month profit contribution to the group, broadly similar to the Eastfield profit performance in the first half. We will of course be able to provide actual, rather than illustrative financials at year end, and will give you a clear line of sight of Eastfield's performance, as well as updating our segmental reporting. Finally from me, the group remains committed to maintaining a strong balance sheet, with the cash flow generation of the group including the underpin from Staple's resilient less transactional earnings, supporting a capital allocation policy of running with some low financial leverage. To facilitate the combination with Eastil, the team successfully arranged an attractive $800 million bridge facility for existing group lenders. £450 million of this has already been refinanced with a 3 plus 1 plus 1 year term bank loan which has pricing and covenants in line with the group's existing main revolving credit facility which matures in 2030. The remaining £350 million is expected to be refinanced within the next 12 months through the issuance of new fixed coupon medium-term US private placement notes in a market well known to saddles. These combined US dollar facilities are expected to have an all-in cost between 5.5% and 6%.

Looking ahead, the expected strong cash generation of the enlarged group

is set to deliver a net debt to EBITDA of 1.5 times or less by year-end 26 and give out 1 times at the end of 2027 or else equal. And the enlarged groups through the year cash flow profile will be similar to Saddle's historic profile, so you should continue to see a higher leverage ratio at half year than the first year. Taken together, the board remains committed to maintaining the group's strong balance sheet and attractive shareholder distribution policy, while still having some scope to pursue further growth opportunities, always taking a disciplined approach. With these positive financial results, along with the technical guidance slide included in the appendix, you should hopefully have all the key data points to update your models. Now back to Simon to talk about strategy.

Thank you Nick. I would say it's too long now. Before I get into that, I'd just like to re-emphasise around the peaceful secure transaction and articulate so clearly and directly how I believe it benefits all the stakeholders of SADL. I'm genuinely confident on all three counts I'm about to give you. So first of all and most importantly for clients. Clients gain a partner who can help them from the very largest most complex of transaction down through leasing and other services that we provide to the day-to-day management of their assets and portfolios. Our people benefit from a larger playing field broader and deeper client relationships, and more opportunity in a genuinely global franchise. And finally, our shareholders gain, as you've heard, an earnings-enhancing transaction that lifts our margin trajectory, provides attractive returns, and strengthens the global position of this group. So let's look at that in the context of what has become affectionately known as the Pyramid of Promise, which is our strategic slide. because that really is the heart of the story. And you will have seen this in March when I put it up for the first time for you. But if we start at the base of that pyramid, we have always had a focus on building our less transactional business lines around the world. That's property management, facilities management. They represent our constant practical touchpoint with our clients. And corporately, they act as the keel on the ship in all weather situations. we then move up through the pyramid through investment management and into the transactional elements of our business via consultancy as well the transactional business of Weller Elements has its own hierarchy of volatility and profitability so if you look at the debt element as I mentioned earlier that's much more of a recurring business line despite it being transactional and at the apex M&A and strategic advice is perhaps the most profitable but also inherently variable. So building on our historic strengths in capital transactions, Eastall Secured Savills builds out that part of the portfolio of services by enhancing that strategic M&A, advisory, portfolio recap, debt and equity capability, and most importantly, at scale, both in EMEA and in North America. And if you recall my slide right at the beginning, that is really important to us. Overall, as I've just said, the combination dramatically increases our ability to serve our clients from the discrete conversation in the boardroom down through the execution of real estate transactions into the day-to-day management of underlying real estate portfolios and assets. So I'm just going to turn now to another slide I put up in March. I'm not really going to go through the whole lot. You've seen most of this before. But on the left-hand side are the many reasons why this investment banking business of Eastill is attractive to us. But I want to just underline two further points. First of all, it enables us to access and partner with top global investors in real estate at the very highest level before there is a transaction or an asset management strategy in mind. And that is critical. Secondly, debt advisory at scale enables us to serve every element of the cap table of the world's real estate investment. Those are the two at heart important things about this deal. Finally, I do believe that this is a genuinely symbiotic relationship between the two sides of our business. Our respective service lines are compatible and complementary. and there is opportunity going both ways as this slide tries to show. And it will catalyse our ability to develop the global portfolio of our traditional service lines over the coming years as well. So it's important in many different ways. If we turn to the business itself, some practical elements around our modus operandi. There's nothing particularly new here in that we reference that this is going to be our strategy in back in March but you recall this is a combination which unusually for a sizable deal in our sector carries very little overlap between the two businesses this is important that it should help to mitigate revenue attrition which inevitably occurs in major major mergers at this time critically too our respective cultures are very very similar and the one thing I would say is that with the broader and deeper interactions we've had between the businesses, between our people since March, that factor has just become ever more clear and more obvious to both of us, which is great. So what we've done from an operating perspective is to ensure that Eastall Secured Saddles retains its existing most operandized, existing operating model, a single global P&L, a single global bonus pool with the frontline connectivity between us managed by something called the buddy system which is an awful phrase but you remember it because it's awful under which several individuals and their respective counterparts at Easton develop assisted relationships across service lines and sectors to know how to work together to go with joint offerings to the client or as a conduit for referrals from a governance perspective ETHEL SECURES CEO and President have both joined the Group Executive Board which is chaired by me and it is the primary committee responsible for running this business overall around the globe and finally I'm particularly pleased that even in the two weeks since we've actually consummated the transaction we're already starting to see potential opportunities across referrals but also joint approaches to market and indeed joint appointments. So that's great news. Our results today turning to other strategic priorities apart from the Eastern position are important because they reflect the standalone strategic and tactical initiatives we've taken over previous periods. I set out all these other strategic priorities in March, so I'm not going to go through them all in detail, but I would categorise them as classic growth and infill strategies as we seek to bring the appropriate segments of that pyramid of promise to our plants and markets around the world over time. You'll see we've done quite a lot over the last few months from the bottom of this slide. Much of it from China to the private office, investment management has been about enhancing our roster of leaders and senior team members but we're still keeping a very close eye on cost and on both individual and team performance across the business alongside some focused growth initiatives which you'll have heard about from the recruiting of the leading data center team in Japan and a native investment management leader there as well through to investing into our proprietary CRM systems in global residential, broader initiatives, in data exploration, and DARA, I use the acronym AI as well, where we've got a lot going on. We're also planning, at the planning stage, I should say, for the launch of future service line enhancements in North America over the coming periods. There'll be more about that over the next few years. So there's a lot going on, but with some very clear strategic filters in place to ensure that we make the best use of both our human and capital resources.

So I look forward to updating you more fully in future periods along these lines.

We're going to finish by looking at that crystal ball. And after a strong H1, We're in a good place with significant pipelines, but I am constantly reminded of my new colleague, Mike Van Caninigan, CEO of Eastil, and his great line, which resonates. Pipeline's great, but you can't eat it. It obviously has to convert into closed transactions and revenue over the course of this period. And to be frank, that execution timing is the hardest thing to predict in current market conditions in many, many markets in which we operate. Which also include, I should say, the new political landscape in the UK, too, in advance of the budget in October. That said, our less transactional businesses are giving us both the resilience and the growth we expect, which together with those pipelines means that our expectations for the full year remain unchanged. I want to finish by thanking all our colleagues around the world for their hard work, resilience in some tricky market conditions, and their relentless focus on client service and rigorous execution, without which none of this would be possible.

So as we go into questions, I'll leave a concluding slide up for you, which I think just sets out how we as management feel about TABLS at the moment.

and this slide speaks to the breadth of our business both by geography and by service line which provides overall diversification but also critically good growth potential it speaks to to our financial strength and the discipline with which we use it and to our focus on margin improvement and I do believe that this set of characteristics supports the enlarged saddle strap which Pursued with conviction and a relentless focus on client needs will enable us to deliver very attractive shareholder returns over coming periods. So thank you, that concludes the full part this morning. When I take some questions, if you have any, please do state your name and your institution for the record. And I think Susie is going to govern any questions that come in online as well. I think the name might refrain from flying, although you probably don't need it, to be fair. Probably don't. Thank you.

Thank you, Gwanda. First of all, I'm going to mark the chair. Sounds like they're a cracking job in the UK. Fascinating to know a little bit more about how you've been so successful there and also what sort of response have you seen from the committee?

Now I suppose it differs across the different service lines, but if you take one of the most acute pieces of evidence around that would be in the residential market, which you know only too well. And clearly it hasn't been a great overall market for UK residential, for all sorts of well-rehearsed reasons we don't need to go into. I think the laser-eyed focus of our teams on proper advice to clients, in environment where what can end up with agents bidding for the business with overvaluation etc has made a significant difference to us I think also and if you've followed us for many years as you know in difficult market conditions there is a tendency for a flight to quality and a flight to a degree of certainty of execution when it's necessary and I think we always benefit from that certainly in my nearly 18 years we always benefited in more difficult market conditions so I think there are two very important factors there I think in the commercial side of our business we've just really stuck at it through thick and thin I think about for instance the retail market over previous years and we start to benefit from the business that is there I would also say that there's also the halo effect of the e-steel secured transaction and in many markets particularly the case in the US I would suggest even though what we do in the US today is leasing there is a halo effect benefit to our organization from being aligned to e-steel secured sales which is obviously much better known in the US than it is necessarily over here so those are a couple of factors second one on

I think they're not hot but we really the next six months plus is all about is

generating the mutual benefits out of this last transaction being done. We will still do both on infill things that I referenced earlier, which is a normal course of events where we have a gap to fill, we will fill it. But I wouldn't expect a hero style deal over the next few months at all. It's all about making the best of what we've now got, which is very exciting.

I think we've got more than enough.

I think that in no particular order The obvious one is with a debt advisory business of scale in the organisation. We already have one in the UK, small, effective, but small and UK focused. But our clients around the globe could well do with that debt advisory capability that comes from these sites. So that's almost a no-brainer. I think the other area which is very exciting, and we've been bolstering our roster, as you heard, in this over the course of the last few months as well, is the whole area of digital infrastructure and data centers. And I'm particularly interested in how East Yorkshire, Savills and Savills can work together in the APAC region, which I think is incredibly exciting. It'll be the case in EMEA as well, that APAC is almost 30% actually in the world. So I think those are two areas where you can really point to activity and potential quite quickly. I think the rest of it is a long burn. We talked about synergies at the March announcement. I've got every confidence that the sort of numbers we put up there are going to be obliterated in real life over a number of years to be looked at. More on Christenington and Doge. You've cooled down a bit. I'm a little bit late this First of all, just a quick checking question about the dividend. Obviously, Elon, as you say, ahead of inflation, but somewhat lacking earnings growth. Is there any reason to think there's any sort of change there going forward, or do you think we should treat the similar company?

No change to the policy at all. The one thing that we'll need to work through is that we'll have a five-month contribution this year from Eastfield, but all shares of the initiative, but the approach around progressively growing the ordinary dividend, depending on the less transactional

What do you think the benefit this year is in terms of cost savings?

I know it's always a bit difficult to get up to date, but what do you think? I think it's very difficult because obviously you've got business, uncovered business development costs as well. Take our Australia business. We've done a lot in Australia and starting to see the results facing in reality in the P&L and also in pipeline. But if you look at gross benefits before that additional cost load, I'd suggest it's around half the 13 million, around half, about six of it, that we guided to last year in this period. Very helpful. Given there were questions, I'll do two more. APAC, the page you showed, the kind of backdrop of market conditions, and APAC looks fairly flat. Now, we know it's not flat. And you need to go a little bit further back in the chart to show that. But perhaps you can give us a context of where Asia is now, where it used to be. That's a bigger focus on mainland China, Hong Kong, which is clearly the heart of our deals. Yeah, I think not to go on about it for too long, but I think one of the big differences, Asia and our Asia business has historically been very Sinocentric. It's been really around greater China. So mainland China, Hong Kong, and it'd be Taiwan, Chinese Taipei as well. We have consciously sought to build our business in Australia and Japan over time. Those are the two markets that have actually strengthened somewhat over the course of this first six months. And we've also seen a strengthening of the Chinese market of Hong Kong and mainland China that candidly offer very low base last year so I would expect to see further growth coming through in the next 18 months or so in that traditional heartland of the Sino axis but I'm also very excited about the things that we're doing in Australia and Japan that will leverage underlying market growth in those markets not to leave aside Singapore Korea etc but those are the material ones where there's significant value on the international scale. I'm sorry, this is the final one. Investment management, the only thing which didn't really move forward. What's the outlook for capital raising in the second half? But also, do you think the business now needs additional scale to kind of keep up where you are? I mean, is that still a big focus point to move that ahead? Yeah, I think we're looking at it at the moment under new leadership, both at the chief executive level and also in the crucial Japanese market where we've recruited a very strong individual from the market to run our business there. The honest answer is that raising capital for core and potentially core plus line filled real estate funds is very, very difficult. So we're doing a lot more in the region of joint ventures and partnerships with, you know, almost as local operating partner with private equity. And I do see that as a significant part of the long-term future. But what I'm doing the most is allowing new leadership to come up with their plan for the next period, which, of course, we'll be discussing with Sam. So our partner in that case is Sam's investment manager.

um every day from uh ubs just did one question for me uh of uk presidential obviously china for obvious reasons but are you seeing any like in the tunnel in the 2h i guess for the creditors right back specifically that would continue to strike because you can call it a 12-month run rate of monthly elections for that yeah but then more on the um on the sales market you know under burner we've seen anything to be slightly more positive about, people talking about help to buy and eventually coming back to any thoughts you had around that market picking up or is it just going to remain difficult?

Yeah, I think it's a definitely needs-based market without question. And I do think we are pretty resilient but at the sort of levels that we talked about in the first half. On a sort of macro level for the UK business I would say our international business is performing pretty well, but it's naturally a bit smaller still than the UK. For the UK business as a whole, I think there is a genuine need. Markets like a degree of certainty and clarity over quite a screen. And I think when we get past the first healing budget at the end of October, we'll start to get that clarity, which we so badly need. Obviously, any demand side in a consensus would be very positive. And the repetitive house builders quite rightly see that. But clarity is above all what we need.

I would just ask that on a like-for-like basis, our UK residential leasing business was up. Like-for-like. And that, I think, is going back to one of Simon's comments earlier. In more challenging markets, and this is a more challenging environment to be a landlord, You go to the best advisor to help you. So this year's numbers will be lower within that part of business just because of the timing of the invoicing associated with that work. But like for like, business is doing very well. Led by Andrew over here. That's a very good point.

Anybody else? Thank you.

Good morning, James Fletcher here from Berenberg. Three different names, sorry about that. Can you give us a bit more colour on Middle East and just its impact on transaction advisory business sentiment? I don't think we've touched on it too much. Or perhaps we should do one at a time.

Okay, well first up Middle East, I mean obviously relatively still a relatively new business in residential transactional terms for us. Very strong Q1 with the conflict. That really had an impact on new firm sales. It's really a secondary sales market at the moment as people who are living there start to trade up when they see the opportunities to do so. But critically, the major developments in Dubai are somewhat slower to the market at the moment, and you can imagine for obvious reasons. Abu Dhabi is a little bit stronger, and Egypt is performing very well too, which is excellent news. But it definitely will stall the trajectory, which was stratospheric over the last 18 months in residential sales in the Middle East. It'll stall that for a bit, but that's inevitable.

Okay, and then the second one was just on synergies. I wondered, kind of, you talked about data centres and debt advisory. I wondered, kind of, what the US client base were thinking about the prospect of having

well it's very very early days but I was lucky enough to be invited to the East Hill Secured Private Equity Conference in Utah about five six seven weeks ago now which is C-Suite of Global Private Equity and all I can say is that the goodwill towards the East Hill South is combination was extraordinary and I very much hope that we would see more activity out of that. It's sort of glorified halo effect actually from how we described these things back in March and I'm pretty sure we will see that. It'll take time to kick in but we'll see it.

And then the final one was just on seasonality with regards, I think you might have mentioned this briefly Nick, just kind of going forward what should be things and what lies kind of H1, H2.

So I don't think you'd give a con for either dark or... And that's partly because there is past record associated again with lumpiness. But what I would say is if you look at saddles over the last 10 years, The weighting has been anywhere from 15 through to 35 profit first half versus balance in the second half. They are much nearer the kind of 35-40 first half, second half. I think with regards to the guidance that we've given suggesting that the five-month contribution will be broadly similar to their first half is partly because of the fact they have such a strong first half. And we also know in a market like we're having at the moment, particularly given a lot of their deals tend to be larger, there's a time and risk associated with them. So the overall seasonality within the enlarged group will be lower going forward than historically.

Thank you. Susie, you've got one online, I think.

Are there any specific risks you foresee for the changed UK political landscape or is it just general macro policy risk?

Well obviously we shelter under macro policies also across the board in the UK. I think I don't foresee any specific risk there are a lot of soundbites all over the place as there always are and we're getting used to those in any given moment in the UK but I do think I would re-emphasise that clarity is the important thing more than anything else that's what people can react to and work on you done? unless there are any more questions thank you very much for your attention and time today Look forward to our meeting here in March. Thanks.