CB Richard Ellis Posts Strong Third- Quarter Results; 54% Revenue and 72% EBITDA Gains; 20% EPS Growth -- in Line With Consensus Expectations; Growth Across Business Segments.LOS LOS Length of stay, see there ANGELES--(BUSINESS WIRE)--Nov. 11, 1998--CB Richard Ellis There are several prominent people named Richard Ellis, including
See: New York Stock Exchange :CBG CBG corticosteroid-binding globulin. ), the world leader in commercial real estate services, Wednesday Wednesday: see week. released third-quarter financial results and reported strong growth in revenues, EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) A metric used to show a company's profitability, but not its cash flow. EBITDA became popular in the 1980s to show the potential profitability of leveraged buyouts, but has become and EPS (Encapsulated PostScript) A PostScript file format used to transfer a graphic image between applications and platforms. EPS files contain PostScript code as well as an optional preview image in TIFF, WMF, PICT or EPSI, the latter being an ASCII-only format. over prior-year levels. A 54% increase in revenues, a 72% EBITDA increase and a 20% increase in EPS, before nonrecurring Non`re`cur´ring a. 1. Nonrecurrent; as, the costs of a layoff are considered as a nonrecurring expense s>. items, highlighted the report. Chairman and Chief Executive Officer Jim Didion Noun 1. Didion - United States writer (born in 1934) Joan Didion commented, "We are very pleased with the gains we achieved on a combined basis, the performance of each of our businesses and the tremendous strides we have made in firmly establishing ourselves in the global marketplace." Didion further explained that EBITDA grew more rapidly than revenues during the period, evidencing the productivity and leverage the company can deliver through its scale and global infrastructure. From a cash flow perspective, Didion noted, "Our cash flow was on target during the period, and earnings per share (EPS) were in line with analysts' estimates, notwithstanding additional interest costs incurred during the three months, due to timing of acquisition closings and differing expectations as to amortization costs." Didion continued, "As we look to the close of 1998, and the current uncertainty in the capital markets, we continue to expect a good performance overall. While investment sales and mortgage originations may be negatively affected, our other businesses are on track and the historic strength of the fourth quarter in this industry should drive activity levels and resulting revenues." "While current market conditions lead to near-term near-term adj. Of, for, or involving a short period of time in the near future. uncertainty, CB Richard Ellis CB Richard Ellis Group, Inc. NYSE: CBG is a multinational real estate corporation currently based in Los Angeles, California, U.S.A.. On December 20, 2006, the corporation, also known as CBRE, completed acquisition of Trammell Crow Co. in a transaction valued at $2. is the strongest firm in the industry in terms of both performance and market positioning, and we're expecting to deliver over $1 billion in revenues this year coupled with substantial profitability," declared Didion. Didion reiterated that the company expects a slowdown For articles with similar titles, see Slow Down (disambiguation). A slowdown is an industrial action in which employees perform their duties but seek to reduce productivity or efficiency in their performance of these duties. in investment property transactions which may continue into the first half of 1999, and some moderation in mortgage originations given the turmoil in the financial markets. Didion explained that results this quarter relative to the prior year include the contribution from a number of acquisitions concluded since the start of the third quarter of last year, specifically REI Ltd. in April 1998, London-based Hillier Hillier is a surname, and may refer to:
As anticipated, the company reported higher debt levels during the period due primarily to the financing of Hillier Parker and the purchase of remaining local ownership interests of its Australian Australian pertaining to or originating in Australia. Australian bat lyssavirus disease see Australian bat lyssavirus disease. Australian cattle dog a medium-sized, compact working dog used for control of cattle. and Canadian businesses Canadian Business is the longest-publishing business magazine in Canada. It was founded in 1928 as The Commerce of the Nation, the organ of the Canadian Chamber of Commerce. The magazine was renamed Canadian Business in 1933. . Didion commented that debt levels should begin to ratchet down Verb 1. ratchet down - move by degrees in one direction only; "a ratcheting lopping tool" rachet up, ratchet advance, march on, move on, progress, pass on, go on - move forward, also in the metaphorical sense; "Time marches on" now that the pace of acquisition activity has slowed and the global network is in place. According to according to prep. 1. As stated or indicated by; on the authority of: according to historians. 2. In keeping with: according to instructions. 3. Didion, over the next few years, internal expansion will be the main driver of the company's growth, rather than acquisitions, and the company's strong cash flow will be used to reduce current debt levels. Approximately $75 million in debt is targeted for repayment during 1999, based on current market expectations. Stock Buyback Stock buyback A corporation's purchase of its own outstanding stock, usually in order to raise the company's earnings per share. stock buyback See buyback. Program Underway The company confirmed that it continues to believe that its shares are undervalued Undervalued A stock or other security that is trading below its true value. Notes: The difficulty is knowing what the "true" value actually is. Analysts will usually recommend an undervalued stock with a strong buy rating. and expects to continue repurchasing shares from time to time under its $10 million stock repurchase Stock repurchase A firm's repurchase of outstanding shares of its common stock. program. The buyback Buyback The buying back of outstanding shares (repurchase) by a company in order to reduce the number of shares on the market. Companies will buyback shares either to increase the value of shares still available (reducing supply), or to eliminate any threats by shareholders who may program was initiated on Oct. 16 and is in effect through Dec. 31. The company has purchased approximately 338,900 shares of common stock to date. At Sept. 30, 1998, the company had 20.7 million shares of common stock outstanding. Consolidated Results For the quarter ended Sept. 30, 1998, consolidated revenues increased 54% to $273.8 million from $177.5 million in the 1997 third quarter. EBITDA increased 72% to $35.9 million compared with $20.9 million in 1997 (before merger-related and other nonrecurring charges Nonrecurring Charge An expense occurring only once on a company's financial statement. Notes: An extraordinary item is an example of a nonrecurring charge. Also known as "nonrecurring item". ). The company reported net income applicable to common shareholders of $10.1 million, or $0.48 per share, vs. a net loss applicable to common shareholders of $2.9 million, or $0.19 per share in the comparable year-ago quarter. Net income applicable to common shareholders in 1998 was $10.1 million, or $0.48 per share, in the third quarter, compared to net income before the effect of merger-related and other non-recurring charges of $6.5 million, or $0.40 per share during the 1997 third quarter. For the nine months ended Sept. 30, 1998, consolidated revenues advanced 50% to $704.2 million, up from $469.5 million in the comparable period of 1997. EBITDA excluding merger-related and other nonrecurring charges improved 72% to $79.2 million from $46.2 million in the comparable period of 1997. Due to the deemed dividend associated with accounting for the January 1998 repurchase re·pur·chase tr.v. re·pur·chased, re·pur·chas·ing, re·pur·chas·es To buy (something) again. n. The act of buying something that one previously sold or owned. Noun 1. of its preferred stock Stock shares that have preferential rights to dividends or to amounts distributable on liquidation, or to both, ahead of common shareholders. Preferred stock is given preference over common stock. Holders of preferred stock receive dividends at a fixed annual rate. , the company reported a net loss applicable to common shareholders of $21.3 million in 1998 vs. income of $2.2 million in the comparable year-ago period. Net income applicable to common shareholders prior to adjustments rose to $19.7 million, or $0.96 per share, from $11.6 million, or $0.79 per share, in the corresponding prior-year period. Year-to-date Year-to-date (YTD) The period beginning at the start of the calendar year up to the current date. results include April 18 (date of acquisition) through Sept. 30, 1998, results for REI; approximately three months contribution from Hillier Parker and the full nine-month contribution from Koll, for which only one month was included in the prior year. Additionally, the one-time charges for the 1998 nine-month period recorded in the second quarter totaling $16.6 million consist of costs associated with the REI acquisition and integration ($3.8 million); the change in the company's name to CB Richard Ellis ($4.8 million); and the write-down Write-Down Reducing the book value of an asset because it is overvalued compared to the market value. Notes: This is usually reflected in the company's income statement as an expense, thereby reducing net income. in the carrying value Carrying Value Also know as "book value," it is a company's total assets minus intangible assets and liabilities, such as debt. Notes: This is different than market value, as it can be higher or lower depending on the circumstances. of the company's headquarters building ($8.0 million), all of which were anticipated. One-time charges for the comparable period in 1997 included merger-related and other nonrecurring charges of $16.0 million related to the Koll acquisition and concurrent refinancing Refinancing An extension and/or increase in amount of existing debt. . Market Fundamentals Are Strong Despite the recent disruption disruption /dis·rup·tion/ (dis-rup´shun) a morphologic defect resulting from the extrinsic breakdown of, or interference with, a developmental process. in the U.S. capital markets, which has affected some investment sales transactions and loan originations The examples and perspective in this article or section may not represent a worldwide view of the subject. Please [ improve this article] or discuss the issue on the talk page. , the company believes real estate market fundamentals in the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. and Europe, the company's two primary markets, remain strong. Representative of the industry's strength, in the U.S. office space sector the national vacancy VACANCY. A place which is empty. The term is principally applied to cases where an office is not filled. 2. By the constitution of the United States, the president has the power to fill up vacancies that may happen during the recess of the senate. rate for office space dropped 20 basis points to 9% for the third quarter, compared to 9.2% last quarter, according to Torto Wheaton Research, CB Richard Ellis' Boston based real estate econometric e·con·o·met·rics n. (used with a sing. verb) Application of mathematical and statistical techniques to economics in the study of problems, the analysis of data, and the development and testing of theories and models. forecasting and consulting firm Noun 1. consulting firm - a firm of experts providing professional advice to an organization for a fee consulting company business firm, firm, house - the members of a business organization that owns or operates one or more establishments; "he worked for a . Continued strong demand for office space fueled the declining vacancy rate in the U.S. The outlook for the remainder of 1998 continues to be favorable fa·vor·a·ble adj. 1. Advantageous; helpful: favorable winds. 2. Encouraging; propitious: a favorable diagnosis. 3. with healthy market fundamentals continuing. Although national economic growth may be slower in 1999, the company believes there is only low probability of an economic recession or long-term Long-term Three or more years. In the context of accounting, more than 1 year. long-term 1. Of or relating to a gain or loss in the value of a security that has been held over a specific length of time. Compare short-term. activity slowdown occurring, particularly in the U.S. real estate economy, where inflation remains low, interest rates are low and softening softening /sof·ten·ing/ (sof´en-ing) malacia. softening a change of consistency, with loss of firmness or hardness. , vacancy rates are at 10-year-plus lows, and there is little sign of over-building on a national basis. The company believes the current financial turmoil may in fact be limiting the amount of new supply entering the market in 1999 and beyond, thereby keeping demand and supply in relative balance. Segment Results For the third quarter, each business segment generated solid revenue growth and increases in EBITDA relative to the comparable prior-year period. Didion stated, "We also benefited from an industry environment which was relatively strong during the earlier part of the quarter. And, although global economic conditions became unsettled midway Midway, island group (2 sq mi/5.2 sq km), central Pacific, c.1,150 mi (1,850 km) NW of Honolulu, comprising Sand and Eastern islands with the surrounding atoll. Discovered by Americans in 1859, Midway was annexed in 1867. A cable station was opened in 1903. through the period, with most weakened weak·en tr. & intr.v. weak·ened, weak·en·ing, weak·ens To make or become weak or weaker. weak  en·er n. economic conditions in Asia and the American
capital markets, we were able to deliver strong results, indicative of
our ability to capture increased market share despite changing external
conditions."
Relative Gains For the quarter ended Sept. 30, 1998, CB Richard Ellis generated revenue gains of 33% in Brokerage Services, which advanced to $136.4 million; 97% in Corporate Services Activities that combine or consolidate certain enterprise-wide needed support services, provided based on specialized knowledge, best practices, and technology to serve internal (and sometimes external) customers and business partners. , which rose to $20.3 million; 112% in Management Services, which improved to $34.2 million; and 71% in Financial Services The examples and perspective in this article or section may not represent a worldwide view of the subject. Please [ improve this article] or discuss the issue on the talk page. , which increased to $82.9 million. Brokerage Services (50% of revenues; grew 33%) The company's core business, Brokerage Services (commercial property sales and leasing), contributed 50% to consolidated revenues for the third quarter. Brokerage revenues increased 33% to $136.4 million, up from $102.7 million in the comparable 1997 quarter, attributable to appreciation in rents and increased transaction volume. EBITDA advanced 15% for the quarter. Brett White Brett White (born April 8 1982 in Cooma, New South Wales) is an Australian professional rugby league footballer. He plays for the Melbourne Storm in the National Rugby League. , President, Brokerage Services, North America North America, third largest continent (1990 est. pop. 365,000,000), c.9,400,000 sq mi (24,346,000 sq km), the northern of the two continents of the Western Hemisphere. , said, "Our performance this quarter reflects our ability to rapidly consolidate market share from both our national and regional competitors. We believe this is because we are clearly being differentiated by our clients as offering a broader service menu than our competitors." White remained confident about growth prospects for the remainder of 1998 and into next year, stating, "We believe that in the majority of real estate markets around the country, supply and demand are in balance, favoring favoring an animal is said to be favoring a leg when it avoids putting all of its weight on the limb. A part of being lame in a limb. stable if not appreciating rents and prices. And, in general, our transaction mix is well dispersed dis·perse v. dis·persed, dis·pers·ing, dis·pers·es v.tr. 1. a. To drive off or scatter in different directions: The police dispersed the crowd. b. by client type and transaction size. This diversity helps insulate in·su·late tr.v. in·su·lat·ed, in·su·lat·ing, in·su·lates 1. To cause to be in a detached or isolated position. See Synonyms at isolate. 2. us from changing market conditions, including those in the credit markets." Brokerage revenues from the company's international operations Internal Operations (I.O., IO or I/O) is a fictional American Intelligence Agency in Wildstorm comics. It was originally called International Operations. I.O. first appeared in WildC.A.T.S. volume 1 #1 (August, 1992) and was created by Brandon Choi and Jim Lee. contributed to the overall gains, with strong year-over-year performance in Europe and South America South America, fourth largest continent (1991 est. pop. 299,150,000), c.6,880,000 sq mi (17,819,000 sq km), the southern of the two continents of the Western Hemisphere. , and relatively flat results in Asia Pacific notwithstanding the depressed economies throughout the region. The company expects solid gains internationally, both near term and long term, due to its unique positioning as the only commonly owned and commonly managed global network. Corporate Services (7% of revenues; grew 97%) Corporate Services provides transaction management, advisory services advisory services advisory services provided to the public, in their capacity as owners and managers of animals, are an important part of veterinary science. They may be provided by government bureaux, by commercial companies who deal in pharmaceuticals or animals or animal and facilities management The management of a user's computer installation by an outside organization. All operations including systems, programming and the datacenter can be performed by the facilities management organization on the user's premises. on a regional, national and international basis, and constitutes a "one-stop" shop for major corporate clients. Revenues advanced 97% to represent 7% of total revenues. The bulk of the revenue growth is attributable to the Koll and REI acquisitions. Approximately 110 million square feet of corporate facilities are now under management, a 31% increase year to date. EBITDA for the quarter was $3.0 million, representing a 631% increase from last year, although margins remain low due to continuing investments in skilled and experienced people and systems in the business. The company reported that its client base has grown, counting over 100 major multinational and national corporations as clients. Gary Beban Gary Joseph Beban (born August 5, 1946 in Redwood City, California) is a former American football player. Son of an Italian-born mother and a first generation Croatian-American father, Beban won the 1967 Heisman Trophy, the most prestigious award in college football, and the , Senior Executive Managing Director, Global Corporate Advisory Services, said, "We made great strides with our client base as we have seen continued interest and active participation by corporate real estate departments embracing and enhancing outsourcing (1) Contracting with outside consultants, software houses or service bureaus to perform systems analysis, programming and datacenter operations. Contrast with insourcing. See netsourcing, ASP, SSP and facilities management. and service delivery techniques. And, our client and account management teams are concentrating on improving the consistency of our practices with established accounts and integrating complementary functions as required, all of which helps us generate strong results." "Corporate Services performance from activity overseas continues to increase as corporations apply strategies designed to adjust production capacities to fluctuating fluc·tu·ate v. fluc·tu·at·ed, fluc·tu·at·ing, fluc·tu·ates v.intr. 1. To vary irregularly. See Synonyms at swing. 2. To rise and fall in or as if in waves; undulate. v. market conditions. While industries such as telecom and financial services may be bringing some space back onto the market due to merger and consolidation activities, technology and consumer product suppliers are still maximizing their use of space, creating activity," commented Beban. Management Services (13% of revenues; grew 112%) Management Services provides a wide range of property management services and manages 371 million square feet of property worldwide for hundreds of clients. Revenue advanced 112% to $34.2 million, compared to $16.1 million in the previous third quarter, to represent 13% of total revenues. EBITDA for the quarter grew at a faster rate, 306% to $5.3 million. Performance results for the current quarter reflect the inclusion of results from Koll, Mathews Click (acquired in June 1998); and Hillier Parker (acquired in July 1998) for the full three months; whereas the 1997 third quarter included just one month of Koll results. According to Jana Turner, President, Institutional Management Services, North America, "We are pleased with our quarterly results which are attributable to both organic growth and the impact of acquisitions. Our nationwide platform has allowed us to leverage our good product mix by applying it to our management services portfolios across multiple markets. Our intent is to stay focused on building our sources of fee income, such as from The Service Direct Advantage (a tenant and client services program) and our strategic engineering group, which have both experienced strong demand from new clients and existing clients." Financial Services (30% of revenues; grew 71%) Financial Services offers a broad range of products and services to Wall Street, institutional, corporate and offshore investors. Growth was realized across all services, including investment property acquisitions and sales, mortgage banking, valuation/appraisal, asset management and real estate market research. The company further reported its assets under management Assets Under Management (AUM) is a term used by financial services companies in the mutual fund and money management or investment management business to gauge how much money they are managing. for hard-asset funds, loan funds, and mutual funds grew in terms of the aggregate value of existing funds and broader product offerings. Revenue from the Financial Services segment contributed 30% to consolidated quarterly revenues and increased 71% during the third quarter vs. the comparable year-ago quarter. EBITDA advanced 97% for the quarter over last year's third quarter. Ray Wirta, Chief Operating Officer Chief Operating Officer (COO) The officer of a firm responsible for day-to-day management, usually the president or an executive vice-president. of the company and Chairman, North America, stated, "Revenues reflect strong growth quarter to quarter, with top line growth in all financial services activities during the third quarter. While turmoil in the CMBS CMBS See: Commercial Mortgage Backed Securities markets will have some effect on the full-year results for the L.J. Melody melody, succession of single tones of varying pitch. Melody is the linear aspect of music, in contrast to harmony, the chordal aspect, which results from the simultaneous sounding of tones. & Company mortgage brokerage operations, it is well ahead of last year's third quarter and we are still expecting to exceed prior-year results." Wirta noted the company has been in the commercial mortgage origination Origination The process through which a mortgage lender creates a mortgage secured by some amount of the mortgagor's real property. Notes: Also known as loan origination, everyone must go through the origination process when securing a mortgage for a piece of real and servicing businesses since 1935, and the bulk of its activity is classic insurance company correspondency cor·re·spon·den·cy n. pl. cor·re·spon·den·cies Correspondence. lending. The company takes no balance sheet risk in this business so the volatility of spreads over treasuries is not a factor in its profitability. Forward-Looking Statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. This release may contain forward-looking statements as well as historical information. Forward-looking statements, which are included in accordance Accordance is Bible Study Software for Macintosh developed by OakTree Software, Inc.[] As well as a standalone program, it is the base software packaged by Zondervan in their Bible Study suites for Macintosh. with the "safe harbor Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. " provisions of the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995, may involve known and unknown risks, uncertainties and other factors that may cause the company's actual results and performance in future periods to be materially different from any future results or performance suggested by the forward-looking statements in this release. Such forward-looking statements speak only as of the date of this release. The company expressly disclaims any obligation to update or revise any forward-looking statements found herein to reflect any changes in company expectations or results or any change in events. CB Richard Ellis is the world's leading real estate services company. With headquarters in Los Angeles Los Angeles (lôs ăn`jələs, lŏs, ăn`jəlēz'), city (1990 pop. 3,485,398), seat of Los Angeles co., S Calif.; inc. 1850. and over 9,000 employees worldwide, the company serves real estate owners, investors and occupiers through over 200 principal offices in 29 countries. Services include property sales and leasing, property management, corporate advisory services and facilities management, mortgage banking, investment management, capital markets, appraisal/valuation and research and consulting. CB Commercial and REI Limited, which merged in April 1998 to form CB Richard Ellis, and Hillier Parker, which was acquired in July 1998, had combined 1997 revenues of $1.0 billion. For more information on CB Richard Ellis Services Inc. (via facsimile and at no cost), call 800/PRO-INFO and dial client code "CBG." If calling from outside the United States, please dial 732/544-2850. -0-
CB RICHARD ELLIS SERVICES INC.
OPERATING RESULTS
For the Three Months Ended Sept. 30, 1998
with Comparative Figures for the Similar Period in 1997
(Dollars in thousands except per share data)
(Unaudited)
Quarter ended Sept. 30,
Consolidated 1998 1997 Difference % Change
Revenue $273,803 $177,520 $ 96,283 54.2 %
Costs and expenses:
Commissions, fees and
other incentives 113,559 87,588 25,971 29.7 %
Operating,
administrative
and other 124,309 69,046 55,263 80.0 %
Merger-related and
other nonrecurring
charges -- 12,924 (12,924) (100.0)%
Depreciation and
amortization 9,337 6,098 3,239 53.1 %
Operating income 26,598 1,864 24,734 1,326.9 %
Interest income 703 740 (37) (5.0)%
Interest expense 9,628 4,158 5,470 131.6 %
Income (loss) before
provision (benefit)
for income tax 17,673 (1,554) 19,227 1,237.3 %
Provision (benefit)
for income tax 7,534 (569) 8,103 1,424.1 %
Net income (loss)
before extraordinary
items 10,139 (985) 11,124 1,129.3 %
Extraordinary items -- 951 (951) (100.0)%
Net income (loss) $ 10,139 $ (1,936) $ 12,075 623.7 %
Dividend on
preferred stock $ -- $ 1,000 $ (1,000) (100.0)%
Net income (loss)
applicable to
common stockholders $ 10,139 $ (2,936) $ 13,075 445.3 %
Basic earnings (loss)
per share $ 0.49 $ (0.19) $ 0.68 357.9 %
Number of shares
used in computing
basic earnings
(loss) per share 20,692,573 15,419,930 5,272,643 34.2 %
Diluted earnings
(loss) per share $ 0.48 $ (0.19) $ 0.67 352.6 %
Number of shares
used in computing
diluted earnings
(loss) per share 21,101,324 15,419,930 5,681,394 36.8 %
Adjusted diluted
earnings per
share/a $ 0.48 $ 0.40 $ 0.08 20.0 %
Number of shares
used in computing
adjusted diluted
earnings per
share/a 21,101,324 16,231,034 4,870,290 30.0 %
EBITDA excluding
merger-related and
other nonrecurring
charges $ 35,935 $ 20,886 $ 15,049 72.1 %
(a) Excludes the effect of merger-related and other nonrecurring
charges, net of tax effect.
CB RICHARD ELLIS SERVICES INC.
OPERATING RESULTS BY BUSINESS SEGMENT
For the Three Months Ended Sept. 30, 1998
with Comparative Figures for the Similar Period in 1997
(Dollars in thousands)
(Unaudited)
Quarter ended Sept. 30,
1998 1997 Difference % Change
Brokerage Services
Revenue $136,435 $102,676 $ 33,759 32.9 %
Costs and expenses:
Commissions, fees and
other incentives 71,469 57,280 14,189 24.8 %
Operating,
administrative and
other 50,697 33,007 17,690 53.6 %
Depreciation and
amortization 3,228 3,633 (405) (11.1)%
Operating income $ 11,041 $ 8,756 $ 2,285 26.1 %
EBITDA $ 14,269 $ 12,389 $ 1,880 15.2 %
EBITDA Margin 10.5% 12.1%
EBITDA as a percent
of consolidated
EBITDA 39.7% 59.4%
Corporate Services
Revenue $ 20,330 $ 10,300 $ 10,030 97.4 %
Costs and expenses:
Commissions, fees and
other incentives 6,326 5,016 1,310 26.1 %
Operating,
administrative and
other 11,049 4,880 6,169 126.4 %
Depreciation and
amortization 626 179 447 249.7 %
Operating income $ 2,329 $ 225 $ 2,104 935.1 %
EBITDA $ 2,955 $ 404 $ 2,551 631.4 %
EBITDA Margin 14.5% 3.9%
EBITDA as a percent
of consolidated
EBITDA 8.2% 1.9%
Management Services
Revenue $ 34,163 $ 16,133 $ 18,030 111.8 %
Costs and expenses:
Commissions, fees and
other incentives 5,951 4,642 1,309 28.2 %
Operating,
administrative and
other 22,869 10,175 12,694 124.8 %
Depreciation and
amortization 1,908 670 1,238 184.8 %
Operating income $ 3,435 $ 646 $ 2,789 431.7 %
EBITDA $ 5,343 $ 1,316 $ 4,027 306.0 %
EBITDA Margin 15.6% 8.2%
EBITDA as a percent
of consolidated
EBITDA 14.9% 6.3%
Financial Services
Revenue $ 82,875 $ 48,411 $ 34,464 71.2 %
Costs and expenses:
Commissions, fees and
other incentives 29,813 20,650 9,163 44.4 %
Operating,
administrative and
other 39,694 20,984 18,710 89.2 %
Depreciation and
amortization 3,575 1,616 1,959 121.2 %
Operating income $ 9,793 $ 5,161 $ 4,632 89.8 %
EBITDA $ 13,368 $ 6,777 $ 6,591 97.3 %
EBITDA Margin 16.1% 14.0%
EBITDA as a percent
of consolidated
EBITDA 37.2% 32.4%
Merger-related and
other nonrecurring
charges $ -- $ 12,924 $(12,924)
CB RICHARD ELLIS SERVICES INC.
OPERATING RESULTS
For the Nine Months Ended Sept. 30, 1998
with Comparative Figures for the Similar Period in 1997
(Dollars in thousands except per share data)
(Unaudited)
Nine months ended Sept. 30,
Consolidated 1998 1997 Difference % Change
Revenue $704,214 $469,542 $234,672 50.0 %
Costs and expenses:
Commissions, fees and
other incentives 310,641 237,716 72,925 30.7 %
Operating,
administrative and
other 314,330 185,642 128,688 69.3 %
Merger-related and
other nonrecurring
charges 16,585 12,924 3,661 28.3 %
Depreciation and
amortization 22,086 12,272 9,814 80.0 %
Operating income 40,572 20,988 19,584 93.3 %
Interest income 1,968 1,959 9 0.5 %
Interest expense 21,359 12,007 9,352 77.9 %
Income before
provision for
income tax 21,181 10,940 10,241 93.6 %
Provision for
income tax 10,257 4,786 5,471 114.3 %
Net income before
extraordinary items 10,924 6,154 4,770 77.5 %
Extraordinary items -- 951 (951) (100.0)%
Net income $ 10,924 $ 5,203 $ 4,770 91.7 %
Dividend on preferred
stock $ 32,273/a $ 3,000 $ 29,273 975.8 %
Net income (loss)
applicable to common
stockholders $(21,349) $ 2,203 $(23,552) (1,069.1)%
Basic earnings (loss)
per share $ (1.07) $ 0.16 $ (1.23) (768.8)%
Number of shares used
in computing basic
earnings (loss) per
share 19,917,773 14,011,922 5,905,851 42.1 %
Diluted earnings
(loss) per share $ (1.07) $ 0.15 $ (1.22) (813.3)%
Number of shares
used in computing
diluted earnings
per share 19,917,773 14,662,536 5,255,237 35.8 %
Adjusted diluted
earnings per
share/b $ 0.96 $ 0.79 $ 0.17 21.5 %
Number of shares
used in computing
adjusted diluted
earnings per
share/b 20,454,938 14,662,536 5,792,402 39.5 %
EBITDA excluding
merger-related and
other nonrecurring
charges $ 79,243 $ 46,184 $ 33,059 71.6 %
(a) Deemed dividend associated with the repurchase of preferred stock.
(b) Excludes the effect of deemed dividend associated with the
repurchase of preferred stock and merger-related and other
nonrecurring charges, net of tax effect.
CB RICHARD ELLIS SERVICES INC.
OPERATING RESULTS BY BUSINESS SEGMENT
For the Nine Months Ended Sept. 30, 1998
with Comparative Figures for the Similar Period in 1997
(Dollars in thousands)
(Unaudited)
Nine months ended Sept. 30,
1998 1997 Difference % Change
Brokerage Services
Revenue $372,014 $281,858 $ 90,156 32.0 %
Costs and expenses:
Commissions, fees and
other incentives 196,229 157,977 38,252 24.2 %
Operating,
administrative and
other 131,878 95,539 36,339 38.0 %
Depreciation and
amortization 7,254 6,548 706 10.8 %
Operating income $ 36,653 $ 21,794 $ 14,859 68.2 %
EBITDA $ 43,907 $ 28,342 $ 15,565 54.9 %
EBITDA Margin 11.8% 10.1%
EBITDA as a percent
of consolidated
EBITDA 55.4% 61.4%
Corporate Services
Revenue $ 50,104 $ 22,554 $ 27,550 122.2 %
Costs and expenses:
Commissions, fees
and other incentives 18,069 11,895 6,174 51.9 %
Operating,
administrative and
other 30,697 10,047 20,650 205.5 %
Depreciation and
amortization 1,743 305 1,438 471.5 %
Operating income
(loss) $ (405) $ 307 $ (712) (231.9)%
EBITDA $ 1,338 $ 612 $ 726 118.6 %
EBITDA Margin 2.7% 2.7%
EBITDA as a percent
of consolidated
EBITDA 1.7% 1.3%
Management Services
Revenue $ 85,641 $ 38,017 $ 47,624 125.3 %
Costs and expenses:
Commissions, fees and
other incentives 19,301 13,758 5,543 40.3 %
Operating,
administrative and
other 57,151 21,052 36,099 171.5 %
Depreciation and
amortization 4,478 986 3,492 354.2 %
Operating income $ 4,711 $ 2,221 $ 2,490 112.1 %
EBITDA $ 9,189 $ 3,207 $ 5,982 186.5 %
EBITDA Margin 10.7% 8.4%
EBITDA as a percent
of consolidated
EBITDA 11.6% 6.9%
Financial Services
Revenue $196,455 $127,113 $ 69,342 54.6 %
Costs and expenses:
Commissions, fees
and other incentives 77,042 54,086 22,956 42.4 %
Operating,
administrative and
other 94,604 59,004 35,600 60.3 %
Depreciation and
amortization 8,611 4,433 4,178 94.2 %
Operating income $ 16,198 $ 9,590 $ 6,608 68.9 %
EBITDA $ 24,809 $ 14,023 $ 10,786 76.9 %
EBITDA Margin 12.6% 11.0%
EBITDA as a percent
of consolidated
EBITDA 31.3% 30.4%
Merger-related and
other nonrecurring
charges $ 16,585 $ 12,924 $ 3,661
CB RICHARD ELLIS SERVICES INC.
CONDENSED CONSOLIDATED BALANCE SHEET
(Dollars in thousands)
Sept. 30, 1998 Dec. 31, 1997
(Unaudited)
ASSETS
Cash and cash equivalents $ 23,437 $ 47,181
Other current assets 154,364 98,109
Property and equipment, net 62,588 50,309
Goodwill and other intangible
assets, net 473,929 239,384
Other assets, net 92,068 65,117
Total assets $ 806,386 $ 500,100
LIABILITIES AND STOCKHOLDERS' EQUITY
Current maturities of long-term debt $ 9,089 $ 4,679
Other current liabilities 169,644 147,937
Long-term debt, less current maturities 390,500 146,273
Other long-term liabilities 54,365 35,768
Total liabilities 623,598 334,657
Minority Interest 5,752 7,672
Stockholders' Equity
Contributed capital 333,748 328,253
Accumulated deficit (156,712) (170,482)
Total stockholders' equity 177,036 157,771
Total liabilities and stockholders'
equity $ 806,386 $ 500,100
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