Exhibit 99.1
PRESS RELEASE
Corporate
Headquarters
100 N.
Sepulveda Blvd.
Suite 1050
El Segundo, CA 90245
www.cbre.com
FOR IMMEDIATE RELEASE
|
For further
information:
|
|
|
|
Kenneth Kay
|
Steve Iaco
|
Shelley Young
|
|
Sr. Executive Vice
President and
|
Sr. Managing Director
of
|
Director of
|
|
Chief Financial Officer
|
Corporate
Communications
|
Investor
Relations
|
|
310.606.4706
|
212.984.6535
|
212.984.8359
|
CB RICHARD ELLIS
GROUP, INC. ANNOUNCES EARNINGS PER SHARE UP
48% FOR SECOND
QUARTER OF 2006
Los Angeles, CA — July 26, 2006 — CB Richard Ellis Group, Inc. (NYSE:CBG) today
reported revenue for the second quarter ended June 30, 2006 of $836.2 million,
up 24% over the second quarter of 2005, and diluted earnings per share of $0.27
for the second quarter ended June 30, 2006, compared with $0.22 for the same
quarter last year. Excluding one-time
charges(1) (predominantly due to costs related to
extinguishment of debt), second quarter
2006 diluted earnings per share was $0.34, an increase of 48% from the $0.23
earned in the second quarter of 2005.
Second Quarter Highlights
For the
second quarter of 2006, the Company generated revenue of $836.2 million, up
24.4% over the $672.2 million posted in the second quarter of 2005. The Company reported net income of $64.3
million, or $0.27 per diluted share, in the second quarter of 2006 compared
with net income of $50.4 million, or $0.22 per diluted share, in the second
quarter of 2005.
Excluding
one-time items, the Company would have earned net income(2) of $79.2
million, or $0.34 per diluted share, in the second quarter of 2006, an increase
of 48.0% and 47.8%, respectively, compared with net income of $53.5 million, or
$0.23 per diluted share, in the second quarter of 2005.
Earnings
Before Interest, Taxes, Depreciation, and Amortization (EBITDA)(3) totaled
$147.0 million for the second quarter of 2006, an increase of $40.5 million, or
38.0%, from the same quarter last year.
The Company’s
second quarter results continue to reflect strong performance across virtually
all business lines and geographies, as well as contributions from
acquisitions. Of
the 24.4%
revenue growth, approximately two-thirds was due to organic growth and
one-third was attributable to acquisitions completed in 2005 and earlier in
2006. The double-digit organic growth
was fueled by notably improved leasing activity in most major markets,
continued strength in investment sales as well as increased revenue in the
appraisal/valuation, mortgage brokerage, property and facilities management and
investment management operations.
During the
second quarter of 2006, the Company repurchased the remaining $164.7 million in
aggregate principal amount of its outstanding 11¼% senior subordinated notes at a premium of $9.3 million. This repurchase combined with the new $600.0
million revolving credit facility, which fully replaced the former facility on
more favorable terms, will reduce annual interest expense by approximately
$25.0 million.
Six-Month Results
Revenue was $1.5 billion for the six months ended June 30, 2006, up
$305.9 million, or 25.3%, compared to the same period last year. Approximately two-thirds of the improvement
was due to organic growth, while acquisitions completed in 2005 and earlier in
2006 drove the remainder of the revenue increase. The Company reported net income of $101.2
million, or $0.43 per diluted share, for the six months ended June 30, 2006
compared to net income of $65.0 million, or $0.28 per diluted share, in the
same period last year.
Excluding one-time items, the Company would have earned net income of
$119.3 million, or $0.51 per diluted share, for the six months ended June 30,
2006, up 64.5% and 59.4%, respectively, over net income of $72.5 million, or
$0.32 per diluted share, for the six months ended June 30, 2005.
EBITDA was $229.7 million for the six months ended June 30, 2006, up
$72.9 million or 46.5% compared to the same period last year.
Management’s Commentary
“Our overall business continues to perform
very well. Commercial real estate
markets worldwide have good momentum, and the combination of people, brand and
platform has enabled us to continue to gain market share,” said Brett White, CB
Richard Ellis’ President and Chief Executive Officer. “As expected, the growth rate seen in the
U.S. investment sales market has eased back to a more orderly and sustainable
rate of growth compared with the heated growth trends of 2004 and 2005, but
still reflects a solid year-over-year increase.
Supported by expanding employment rolls, the U.S. leasing market
continued to improve, seeing higher occupancy and increased rental rates in
many business districts across the country.
At the same time, our Asset Services and Corporate Services businesses
are growing strongly, fueled by the global outsourcing trend. Overseas operations, led by Europe, continue
to turn in robust results, as strong organic growth is being augmented by
strategic in-fill acquisitions that expand the scope and reach of our service
offerings.”
2
Second-Quarter
Segment Highlights
Americas Region
Second quarter revenue for the Americas
region, including the U.S., Canada, Mexico and Latin America, increased 13.1%
to $554.3 million, compared with $489.9 million for the second quarter of
2005. This largely organic revenue
increase was mainly attributable to a continued improving leasing trend and
strong investment sales as well as higher mortgage brokerage,
appraisal/valuation and property and facilities management fees.
Operating income for the Americas region
totaled $84.0 million for the second quarter of 2006, compared with $69.0
million for the second quarter of 2005.
Excluding the impact of one-time items, operating income for the
Americas region would have been $85.4 million for the second quarter of 2006,
an increase of $14.7 million, or 20.8%, as compared to $70.7 million for the
second quarter of last year. The
Americas region’s EBITDA totaled $95.2 million for the second quarter of 2006,
an increase of $15.3 million, or 19.2%, from last year’s second quarter.
EMEA Region
Revenue for the EMEA region, mainly
consisting of operations in Europe, increased 38.3% to $170.3 million for the
second quarter of 2006, compared with $123.1 million for the second quarter of
2005. Organic revenue growth accounted
for slightly more than half of this increase, with the remainder coming from
acquisitions completed in 2005 and earlier in 2006. Operating income for the EMEA segment totaled
$32.5 million for the second quarter of 2006, compared with $10.7 million for
the same period last year. Excluding
the impact of one-time items, operating income for the EMEA region would have
been $33.0 million for the second quarter of 2006, an increase of $21.6
million, or 190.9%, from the second quarter of last year. EBITDA for the EMEA region totaled $35.8
million for the second quarter of 2006, an increase of $22.8 million, or
175.5%, from last year’s second quarter.
These improvements were primarily driven by significantly higher leasing
activities, a continued strong investment sales environment, higher
appraisal/valuation revenues and operating leverage.
Asia Pacific Region
In the Asia Pacific region, which includes
operations in Asia, Australia and New Zealand, revenue totaled $84.7 million
for the second quarter of 2006, a 95.6% increase from $43.3 million for the
second quarter of 2005. Operating income
for the Asia Pacific segment totaled $12.3 million for the second quarter of
2006, compared with $6.6 million for the same period last year, an increase of
87.8%. EBITDA for the Asia Pacific
segment totaled $12.1 million for the second quarter of 2006, an increase of
$4.6 million, or 60.5%, from last year’s second quarter. Approximately half of
the profit improvement in this segment stems from the Company boosting its
ownership percentage in its Japanese affiliate, IKOMA CB Richard Ellis KK, to
51% in early January 2006. The Asia Pacific segment did not incur any
significant one-time costs in the current or prior year quarter.
3
Global Investment Management
Business
In the Global Investment Management segment,
which consists of investment management operations in the U.S., Europe and
Asia, revenue totaled $27.0 million for the second quarter of 2006, a 70.3%
increase from the $15.9 million in the second quarter of 2005. This increase was largely driven by higher
core asset management fees earned in the U.S. and France attributable to an
increasing asset management base. Assets
under management grew to $21.3 billion as of the end of the second quarter, up
$4.0 billion, or 23%, from year-end 2005.
With the increase in revenue, this segment reported a reduced operating
loss of $1.0 million for the second quarter of 2006, compared with an operating
loss of $5.4 million for the same period last year. The current quarter operating loss was driven
by higher bonus expense as well as increased incentive compensation expense of
$1.9 million recognized in the current year quarter for dedicated executives
and team leaders associated with this segment’s carried interest revenue
programs. For the second quarter of
2006, the Company recorded a total of $6.9 million of incentive compensation
expense related to carried interest revenue, none of which pertained to revenue
recognized in the second quarter of 2006.
Revenues associated with these expenses cannot be recognized until
certain financial hurdles are met. The
Company expects that it will recognize income from funds liquidating in 2006
and future years that will more than offset accrued incentive compensation
expense recognized. EBITDA for this
segment totaled $3.9 million for the second quarter of 2006, a decrease of $2.2
million, or 36.7%, from last year’s second quarter. This decrease was driven by
the aforementioned reasons as well as a decrease in equity earnings, which is
included in the calculation of EBITDA but not in the calculation of operating
loss. Equity earnings were stronger in
the second quarter of 2005 due to higher dispositions within selected
funds. The Company expects that overall
results from this segment in the second half of 2006 will more than offset the
EBITDA shortfall from the second quarter. The Global Investment Management
segment did not incur any one-time costs in the current or prior year quarter.
Other Business Highlights
The Company’s mortgage brokerage business
improved in the second quarter, reflecting increased loan originations (up 12%
for the first six months of 2006 to $8.3 billion) as well as increased
referrals from other CB Richard Ellis business lines.
The Company continued to make strong gains in
its outsourcing businesses partially due to the fact that its broad geographic
reach is well aligned with the multi-market requirements of both institutional
investors and large corporations. For example, the
Company furthered its representation of several major Corporate
Services clients, including Boeing (85 million square foot
portfolio), Northrop Grumman (55 million square foot portfolio) and DHL
Express (28 million square foot portfolio).
In addition, the U.S. Asset Services business
achieved a net portfolio gain of 32 million square feet in the first half of
2006, compared with a 7 million square foot net increase for the same period of
2005.
4
The Company’s
second-quarter earnings conference call will be held on Thursday, July 27, 2006
at 10:00 a.m. EDT. A live webcast will
be accessible through the Investor Relations section of the Company’s Web site
at www.cbre.com.
The direct dial-in number for the conference
call is 800-288-9626 (in the U.S.) and 612-332-0107 (for international
callers). A replay of the call will be
available beginning at 1:30 p.m. EDT through midnight August 3, 2006. The
dial-in number for the replay is 800-475-6701 (in the U.S.) and 320-365-3844
(for international callers). The access
code for the replay is 836651. A
transcript of the call will be available on the Company’s Investor Relations
Web site.
About CB Richard Ellis
CB Richard Ellis Group, Inc. (NYSE:CBG), a
FORTUNE 1000 company headquartered in Los Angeles, is the world’s largest
commercial real estate services firm (in terms of 2005 revenue). With
approximately 14,500 employees, the Company serves real estate owners,
investors and occupiers through more than 200 offices worldwide (excluding
affiliate and partner offices). CB Richard Ellis offers strategic advice and
execution for property sales and leasing; corporate services; property,
facilities and project management; mortgage banking; investment management;
appraisal and valuation; and research and consulting. Founded in 1906, CB
Richard Ellis marks a century of excellence in real estate services this year.
Please visit our Web site at www.cbre.com.
Note:
This release contains forward-looking statements within the meaning of
the ‘‘safe harbor’’ provisions of the Private Securities Litigation Reform Act
of 1995, including statements regarding our growth momentum in 2006, future
operations, the impact of acquisitions and future financial performance. These forward-looking statements 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 in forward-looking
statements in this release. Any
forward-looking statements speak only as of the date of this release and, except to the
extent required by applicable securities laws, the Company expressly
disclaims any obligation to update or revise any of them to reflect actual
results, any changes in expectations or any change in events. If the Company does update
one or more forward-looking statements, no inference should be drawn that it
will make additional updates with respect to those or other forward-looking
statements. Factors that could cause
results to differ materially include, but are not limited to: commercial real
estate vacancy levels; employment conditions and their effect on vacancy rates;
property values; rental rates; interest rates; realization of values in
investment funds to offset related incentive compensation expense; any general
economic recession domestically or internationally; general conditions of
financial liquidity for real estate transactions; our ability to leverage our
platform to sustain revenue growth; our ability to retain and incentivize
producers; and our levels of borrowing.
Additional information concerning factors that
may influence CB Richard Ellis Group, Inc.’s financial information is discussed
under “Risk Factors”, “Management’s Discussion and Analysis of Financial
Condition and Results of Operations”, “Quantitative and Qualitative Disclosures
About Market Risk” and “Forward-Looking Statements” in our Annual Report on
Form 10-K for the year ended December 31, 2005, and under “Management’s
Discussion and Analysis of Financial Condition and Results of Operations”, “Quantitative
and Qualitative Disclosures About Market Risk” and “Forward-Looking Statements”
in our Quarterly Report on Form 10-Q for the quarter ended March 31, 2006, as
well as in the Company’s press releases and other periodic filings with the
Securities and Exchange Commission. Such
filings are available publicly and may be obtained off the Company’s Web site
at www.cbre.com or upon request from the CB Richard Ellis Investor Relations
Department at investorrelations@cbre.com.
5
(1) One-time charges
include amortization expense related to net revenue backlog acquired in
acquisitions, integration costs related to acquisitions and loss on
extinguishment of debt.
(2) A
reconciliation of net income to net income, as adjusted for one-time items, is
provided in the exhibits to this release.
(3) The Company’s management
believes that EBITDA is useful in evaluating its performance compared to that
of other companies in its industry because the calculation of EBITDA generally
eliminates the effects of financing and income taxes and the accounting effects
of capital spending and acquisitions, which items may vary for different
companies for reasons unrelated to overall operating performance. As a result, the Company’s management uses
EBITDA as a measure to evaluate the performance of various business lines and
for other discretionary purposes, including as a significant component when
measuring its performance under its employee incentive programs.
However, EBITDA is not a recognized measurement under
U.S. generally accepted accounting principles (GAAP), and when analyzing the
Company’s operating performance, readers should use EBITDA in addition to, and
not as an alternative for, net income determined in accordance with GAAP. Because not all companies use identical
calculations, the Company’s presentation of EBITDA may not be comparable to
similarly titled measures of other companies.
Furthermore, EBITDA is not intended to be a measure of free cash flow
for management’s discretionary use, as it does not consider certain cash
requirements such as tax and debt service payments. The amounts shown for EBITDA also differ from
the amounts calculated under similarly titled definitions in the Company’s debt
instruments, which are further adjusted to reflect certain other cash and
non-cash charges and are used to determine compliance with financial covenants and
the Company’s ability to engage in certain activities, such as incurring
additional debt and making certain restricted payments.
For a reconciliation of EBITDA with the most
comparable financial measures calculated and presented in accordance with GAAP,
see the section of this press release titled “Non-GAAP Financial Measures.”
6
CB RICHARD ELLIS GROUP, INC.
OPERATING RESULTS
FOR THE THREE AND SIX MONTHS ENDED JUNE 30,
2006 AND 2005
(Dollars in thousands, except share data)
|
|
|
Three Months Ended
June 30,
|
|
Six Months Ended
June 30,
|
|
|
|
|
2006
|
|
2005
|
|
2006
|
|
2005
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue
|
|
$
|
836,228
|
|
$
|
672,163
|
|
$
|
1,516,319
|
|
$
|
1,210,429
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Costs and expenses:
|
|
|
|
|
|
|
|
|
|
|
Cost of services
|
|
412,496
|
|
338,691
|
|
752,941
|
|
606,737
|
|
|
Operating, administrative and other
|
|
283,598
|
|
241,730
|
|
548,759
|
|
464,951
|
|
|
Depreciation and amortization
|
|
12,255
|
|
10,818
|
|
27,185
|
|
21,188
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income
|
|
127,879
|
|
80,924
|
|
187,434
|
|
117,553
|
|
|
Equity
income from unconsolidated subsidiaries
|
|
8,428
|
|
15,443
|
|
16,841
|
|
19,373
|
|
|
Minority interest expense
|
|
1,580
|
|
664
|
|
1,809
|
|
1,353
|
|
|
Interest income
|
|
2,976
|
|
3,058
|
|
6,566
|
|
5,503
|
|
|
Interest expense
|
|
13,352
|
|
13,374
|
|
27,287
|
|
26,972
|
|
|
Loss on extinguishment of
debt
|
|
22,255
|
|
1,832
|
|
22,255
|
|
6,762
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before provision
for income taxes
|
|
102,096
|
|
83,555
|
|
159,490
|
|
107,342
|
|
|
Provision for income taxes
|
|
37,842
|
|
33,134
|
|
58,326
|
|
42,349
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
|
|
$
|
64,254
|
|
$
|
50,421
|
|
$
|
101,164
|
|
$
|
64,993
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic income per share
|
|
$
|
0.28
|
|
$
|
0.23
|
|
$
|
0.45
|
|
$
|
0.29
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted
average shares outstanding for basic income per share
|
|
225,964,727
|
|
221,355,696
|
|
225,763,242
|
|
220,979,199
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted income per share
|
|
$
|
0.27
|
|
$
|
0.22
|
|
$
|
0.43
|
|
$
|
0.28
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted
average shares outstanding for diluted income per share
|
|
233,655,941
|
|
229,097,697
|
|
233,304,306
|
|
228,827,433
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBITDA
|
|
$
|
146,982
|
|
$
|
106,521
|
|
$
|
229,651
|
|
$
|
156,761
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
7
CB RICHARD ELLIS GROUP, INC.
SEGMENT RESULTS
FOR THE THREE AND SIX MONTHS ENDED JUNE 30,
2006 AND 2005
(Dollars in thousands)
|
|
|
Three Months Ended
June 30,
|
|
Six Months Ended
June 30,
|
|
|
|
|
2006
|
|
2005
|
|
2006
|
|
2005
|
|
|
Americas
|
|
|
|
|
|
|
|
|
|
|
Revenue
|
|
$
|
554,266
|
|
$
|
489,878
|
|
$
|
1,008,042
|
|
$
|
870,992
|
|
|
Costs and expenses:
|
|
|
|
|
|
|
|
|
|
|
Cost of services
|
|
294,668
|
|
263,295
|
|
535,835
|
|
463,252
|
|
|
Operating, administrative and other
|
|
167,517
|
|
150,150
|
|
328,810
|
|
290,769
|
|
|
Depreciation and amortization
|
|
8,035
|
|
7,455
|
|
15,881
|
|
14,383
|
|
|
Operating income
|
|
$
|
84,046
|
|
$
|
68,978
|
|
$
|
127,516
|
|
$
|
102,588
|
|
|
EBITDA
|
|
$
|
95,194
|
|
$
|
79,857
|
|
$
|
149,748
|
|
$
|
123,295
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EMEA
|
|
|
|
|
|
|
|
|
|
|
Revenue
|
|
$
|
170,285
|
|
$
|
123,139
|
|
$
|
305,516
|
|
$
|
225,249
|
|
|
Costs and expenses:
|
|
|
|
|
|
|
|
|
|
|
Cost of services
|
|
75,504
|
|
54,930
|
|
138,900
|
|
104,705
|
|
|
Operating, administrative and other
|
|
59,661
|
|
55,097
|
|
111,812
|
|
104,991
|
|
|
Depreciation and amortization
|
|
2,659
|
|
2,390
|
|
8,317
|
|
4,814
|
|
|
Operating income
|
|
$
|
32,461
|
|
$
|
10,722
|
|
$
|
46,487
|
|
$
|
10,739
|
|
|
EBITDA
|
|
$
|
35,780
|
|
$
|
12,989
|
|
$
|
55,196
|
|
$
|
15,248
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Asia Pacific
|
|
|
|
|
|
|
|
|
|
|
Revenue
|
|
$
|
84,661
|
|
$
|
43,284
|
|
$
|
145,352
|
|
$
|
77,159
|
|
|
Costs and expenses:
|
|
|
|
|
|
|
|
|
|
|
Cost of services
|
|
42,324
|
|
20,466
|
|
78,206
|
|
38,780
|
|
|
Operating, administrative and
other
|
|
28,931
|
|
15,694
|
|
52,103
|
|
29,201
|
|
|
Depreciation and amortization
|
|
1,057
|
|
549
|
|
1,986
|
|
1,148
|
|
|
Operating income
|
|
$
|
12,349
|
|
$
|
6,575
|
|
$
|
13,057
|
|
$
|
8,030
|
|
|
EBITDA
|
|
$
|
12,144
|
|
$
|
7,566
|
|
$
|
14,242
|
|
$
|
9,708
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Global Investment Management
|
|
|
|
|
|
|
|
|
|
|
Revenue
|
|
$
|
27,016
|
|
$
|
15,862
|
|
$
|
57,409
|
|
$
|
37,029
|
|
|
Costs and expenses:
|
|
|
|
|
|
|
|
|
|
|
Operating, administrative and other
|
|
27,489
|
|
20,789
|
|
56,034
|
|
39,990
|
|
|
Depreciation and amortization
|
|
504
|
|
424
|
|
1,001
|
|
843
|
|
|
Operating (loss) income
|
|
$
|
(977
|
)
|
$
|
(5,351
|
)
|
$
|
374
|
|
$
|
(3,804
|
)
|
|
EBITDA
|
|
$
|
3,864
|
|
$
|
6,109
|
|
$
|
10,465
|
|
$
|
8,510
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
8
Non-GAAP Financial Measures
The following measures are
considered “non-GAAP financial measures” under SEC guidelines:
(i) Net income, as
adjusted for one-time items
(ii) Diluted
earnings per share, as adjusted for one-time items
(iii) EBITDA
(iv) Operating
income, as adjusted for one-time items
The Company believes that
these non-GAAP financial measures provide a more complete understanding of
ongoing operations and enhance comparability of current results to prior
periods as well as presenting the effects of one-time items in all periods
presented. The Company believes that
investors may find it useful to see these non-GAAP financial measures to
analyze financial performance without the impact of one-time items that may
obscure trends in the underlying performance of its business.
9
Net income, as adjusted for one-time items and diluted earnings per
share, as adjusted for one-time items are calculated as follows (dollars in
thousands, except per share data):
|
|
|
Three Months Ended
June 30,
|
|
Six Months Ended
June 30,
|
|
|
|
|
2006
|
|
2005
|
|
2006
|
|
2005
|
|
|
Net income
|
|
$
|
64,254
|
|
$
|
50,421
|
|
$
|
101,164
|
|
$
|
64,993
|
|
|
Amortization expense related to net revenue backlog acquired in
acquisitions, net of tax
|
|
(235
|
)
|
—
|
|
2,003
|
|
—
|
|
|
Integration costs related to acquisitions, net of tax
|
|
1,162
|
|
1,657
|
|
2,090
|
|
3,135
|
|
|
Loss on extinguishment of debt, net of tax
|
|
14,043
|
|
1,442
|
|
14,043
|
|
4,408
|
|
|
Net income, as adjusted
|
|
$
|
79,224
|
|
$
|
53,520
|
|
$
|
119,300
|
|
$
|
72,536
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted income per share, as adjusted
|
|
$
|
0.34
|
|
$
|
0.23
|
|
$
|
0.51
|
|
$
|
0.32
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average shares outstanding for diluted income per share, as
adjusted
|
|
233,655,941
|
|
229,097,697
|
|
233,304,306
|
|
228,827,433
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBITDA
for the Company is calculated as follows (dollars in thousands):
|
|
|
Three Months Ended
June 30,
|
|
Six Months Ended
June 30,
|
|
|
|
|
2006
|
|
2005
|
|
2006
|
|
2005
|
|
|
Net income
|
|
$
|
64,254
|
|
$
|
50,421
|
|
$
|
101,164
|
|
$
|
64,993
|
|
|
Add:
|
|
|
|
|
|
|
|
|
|
|
Depreciation and amortization
|
|
12,255
|
|
10,818
|
|
27,185
|
|
21,188
|
|
|
Interest expense
|
|
13,352
|
|
13,374
|
|
27,287
|
|
26,972
|
|
|
Loss on extinguishment of debt
|
|
22,255
|
|
1,832
|
|
22,255
|
|
6,762
|
|
|
Provision for income taxes
|
|
37,842
|
|
33,134
|
|
58,326
|
|
42,349
|
|
|
Less:
|
|
|
|
|
|
|
|
|
|
|
Interest income
|
|
2,976
|
|
3,058
|
|
6,566
|
|
5,503
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBITDA
|
|
$
|
146,982
|
|
$
|
106,521
|
|
$
|
229,651
|
|
$
|
156,761
|
|
10
Operating income, as adjusted for one-time items is calculated as
follows (dollars in thousands):
|
|
|
Three Months Ended
June 30,
|
|
Six Months Ended
June 30,
|
|
|
|
|
2006
|
|
2005
|
|
2006
|
|
2005
|
|
|
Americas
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income
|
|
$
|
84,046
|
|
$
|
68,978
|
|
$
|
127,516
|
|
$
|
102,588
|
|
|
Integration costs related
to acquisitions
|
|
1,386
|
|
1,740
|
|
2,254
|
|
3,571
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income, as
adjusted
|
|
$
|
85,432
|
|
$
|
70,718
|
|
$
|
129,770
|
|
$
|
106,159
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EMEA
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income
|
|
$
|
32,461
|
|
$
|
10,722
|
|
$
|
46,487
|
|
$
|
10,739
|
|
|
Amortization expense related to net revenue backlog acquired in
acquisitions
|
|
—
|
|
—
|
|
3,174
|
|
—
|
|
|
Integration costs related
to acquisitions
|
|
514
|
|
612
|
|
1,009
|
|
1,237
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income, as
adjusted
|
|
$
|
32,975
|
|
$
|
11,334
|
|
$
|
50,670
|
|
$
|
11,976
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Asia Pacific
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income
|
|
$
|
12,349
|
|
$
|
6,575
|
|
$
|
13,057
|
|
$
|
8,030
|
|
|
Integration costs related
to acquisitions
|
|
47
|
|
—
|
|
47
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income, as
adjusted
|
|
$
|
12,396
|
|
$
|
6,575
|
|
$
|
13,104
|
|
$
|
8,030
|
|
Global Investment Management
The Global
Investment Management segment did not incur any one-time costs associated with
acquisitions in the current or prior year period.
11
EBITDA for segments is calculated as follows
(dollars in thousands):
|
|
|
Three Months Ended
June 30,
|
|
Six Months Ended
June 30,
|
|
|
|
|
2006
|
|
2005
|
|
2006
|
|
2005
|
|
|
Americas
|
|
|
|
|
|
|
|
|
|
|
Net income
|
|
$
|
37,241
|
|
$
|
36,898
|
|
$
|
62,182
|
|
$
|
51,347
|
|
|
Add:
|
|
|
|
|
|
|
|
|
|
|
Depreciation and amortization
|
|
8,035
|
|
7,455
|
|
15,881
|
|
14,383
|
|
|
Interest expense
|
|
11,029
|
|
10,940
|
|
23,466
|
|
22,672
|
|
|
Loss on extinguishment of debt
|
|
22,255
|
|
1,832
|
|
22,255
|
|
6,762
|
|
|
Provision for income taxes
|
|
19,041
|
|
24,162
|
|
31,567
|
|
31,226
|
|
|
Less:
|
|
|
|
|
|
|
|
|
|
|
Interest income
|
|
2,407
|
|
1,430
|
|
5,603
|
|
3,095
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBITDA
|
|
$
|
95,194
|
|
$
|
79,857
|
|
$
|
149,748
|
|
$
|
123,295
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EMEA
|
|
|
|
|
|
|
|
|
|
|
Net income
|
|
$
|
21,665
|
|
$
|
5,904
|
|
$
|
30,517
|
|
$
|
4,916
|
|
|
Add:
|
|
|
|
|
|
|
|
|
|
|
Depreciation and amortization
|
|
2,659
|
|
2,390
|
|
8,317
|
|
4,814
|
|
|
Interest expense
|
|
642
|
|
676
|
|
859
|
|
1,228
|
|
|
Provision for income taxes
|
|
11,162
|
|
5,545
|
|
16,209
|
|
6,523
|
|
|
Less:
|
|
|
|
|
|
|
|
|
|
|
Interest income
|
|
348
|
|
1,526
|
|
706
|
|
2,233
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBITDA
|
|
$
|
35,780
|
|
$
|
12,989
|
|
$
|
55,196
|
|
$
|
15,248
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Asia Pacific
|
|
|
|
|
|
|
|
|
|
|
Net income
|
|
$
|
6,465
|
|
$
|
4,770
|
|
$
|
5,477
|
|
$
|
5,238
|
|
|
Add:
|
|
|
|
|
|
|
|
|
|
|
Depreciation and amortization
|
|
1,057
|
|
549
|
|
1,986
|
|
1,148
|
|
|
Interest expense
|
|
1,000
|
|
757
|
|
1,711
|
|
1,443
|
|
|
Provision for income taxes
|
|
3,674
|
|
1,540
|
|
5,159
|
|
1,977
|
|
|
Less:
|
|
|
|
|
|
|
|
|
|
|
Interest income
|
|
52
|
|
50
|
|
91
|
|
98
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBITDA
|
|
$
|
12,144
|
|
$
|
7,566
|
|
$
|
14,242
|
|
$
|
9,708
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Global Investment Management
|
|
|
|
|
|
|
|
|
|
|
Net (loss) income
|
|
$
|
(1,117
|
)
|
$
|
2,849
|
|
$
|
2,988
|
|
$
|
3,492
|
|
|
Add:
|
|
|
|
|
|
|
|
|
|
|
Depreciation and amortization
|
|
504
|
|
424
|
|
1,001
|
|
843
|
|
|
Interest expense
|
|
681
|
|
1,001
|
|
1,251
|
|
1,629
|
|
|
Provision for income taxes
|
|
3,965
|
|
1,887
|
|
5,391
|
|
2,623
|
|
|
Less:
|
|
|
|
|
|
|
|
|
|
|
Interest income
|
|
169
|
|
52
|
|
166
|
|
77
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBITDA
|
|
$
|
3,864
|
|
$
|
6,109
|
|
$
|
10,465
|
|
$
|
8,510
|
|
12
CB RICHARD ELLIS GROUP, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Dollars in thousands)
(Unaudited)
|
|
|
June 30,
|
|
December 31,
|
|
|
|
|
2006
|
|
2005
|
|
|
Assets:
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
$
|
127,289
|
|
$
|
449,289
|
|
|
Restricted cash
|
|
3,897
|
|
5,179
|
|
|
Receivables, net
|
|
473,161
|
|
483,175
|
|
|
Warehouse receivable(1)
|
|
17,650
|
|
255,963
|
|
|
Property and equipment, net
|
|
156,998
|
|
137,655
|
|
|
Goodwill and other intangibles, net
|
|
1,041,398
|
|
989,719
|
|
|
Deferred compensation assets
|
|
157,642
|
|
144,597
|
|
|
Other assets, net
|
|
419,036
|
|
350,095
|
|
|
Total assets
|
|
$
|
2,397,071
|
|
$
|
2,815,672
|
|
|
Liabilities:
|
|
|
|
|
|
|
Current liabilities, excluding debt
|
|
$
|
634,315
|
|
$
|
853,738
|
|
|
Warehouse line of credit(1)
|
|
17,650
|
|
255,963
|
|
|
Revolving credit facility
|
|
248,000
|
|
|
|
|
Senior secured term loan tranche B
|
|
—
|
|
265,250
|
|
|
11¼% senior subordinated notes
|
|
—
|
|
163,021
|
|
|
9¾% senior notes
|
|
130,000
|
|
130,000
|
|
|
Other debt
|
|
28,410
|
|
18,987
|
|
|
Deferred compensation liability
|
|
187,891
|
|
172,871
|
|
|
Other long-term liabilities
|
|
201,882
|
|
155,333
|
|
|
Total liabilities
|
|
1,448,148
|
|
2,015,163
|
|
|
|
|
|
|
|
|
|
Minority interest
|
|
28,441
|
|
6,824
|
|
|
|
|
|
|
|
|
|
Stockholders’ equity
|
|
920,482
|
|
793,685
|
|
|
Total liabilities and
stockholders’ equity
|
|
$
|
2,397,071
|
|
$
|
2,815,672
|
|
(1) Represents
Freddie Mac loan receivables, which are offset by the related non-recourse
warehouse line of credit facility.
13