Servcorp Sees Dip In Profits, But Remains Optimistic

Serviced office operator Servcorp has seen a dip in net profit as the industry faces challenges on the path to recovery.

The company posted a statutory profit of $22.1 million, which is an increase from $6.9 million from the same time last year. However, the underlying net profit was 23% lower. This was mainly due to weak activity across Australia, Europe, New Zealand, and Asia Pacific.

“The COVID-19 pandemic continues to make trading conditions difficult across every market in which we operate,” the company stated. “Occupancy levels through 2021 financial year have been relatively stable, (with) mature floor occupancy finishing the year at 73 percent.”

This occupancy level is slightly up from the 69% seen during the 2020 fiscal year. 

Servcorp added that although the pandemic has hindered its profits, the company’s pre-pandemic investments into refurbishing reception areas has allowed it to keep its occupancy levels above 70%.

“The rollout of the vaccine across markets in which we operate, as well as impacts of fiscal stimulus, are supporting economic activity, with both business and consumer confidence slowly returning to pre-COVID levels in some markets.”