Payroll management, human resources outsourcing and property and facilities management group Colliers South Africa witnessed a decline in headline earnings per share from 15.8c to 3.2c for the six months ended August.

Revenue for the half-year fell from R187.7-million to R160.7-million.

Colliers said that the negative impact of the global financial crisis of 2008 has filtered through to the operations within the Colliers Property Services vision.

"Whilst still operating profitably the property management business has experienced a decline in its revenue, which is based to a large degree on rental collections, as a result of rental arrears and defaulting tenants.

"The broking, residential and auctioneering operations have all had a very slow period which were aggravated by the financial sectors' reluctance to grant significant loan finance," Colliers said.

It added that a new International Property Asset Management division has been established and will be fully operational before this financial year-end. The division, having minimal start-up costs, is expected to contribute annuity income to the group in the years going forward.

Colliers said the Quyn Outsource division also experienced a slowdown in business due to the decline in private infrastructure spending which has resulted in a decline in the demand for certain skills.

"As previously advised this division has been disposed of to management with effect from 1 September 2009," it added.

On property investments and developments, Colliers said the residential components of the group's property portfolio have not, as a result of the economy, resulted in the anticipated level of sales being achieved and this has caused the executives to resolve to hold the unsold units until the market has recovered.

Looking ahead, Colliers said that in the current trying times it is difficult to be optimistic regarding the short-term prospects of the group.

"However, the directors are confident that, with careful management of expenses and operations, the group will be poised to take advantage of a return to better trading conditions," the group added.

No dividend was declared for the period.

Source: I-Net Bridge