Exhibit 99.1

SUMMARY HISTORICAL AND PRO FORMA FINANCIAL DATA

 

CB Richard Ellis Services

 

The following table is a summary of our historical consolidated financial data as of and for the periods presented, as well as pro forma financial data giving effect to the Insignia acquisition and the related transactions as of and for the period presented. The pro forma statement of operations data do not purport to represent what the results of operations of CB Richard Ellis Services, Inc. would have been if the Insignia acquisition and the related transactions had occurred as of the date indicated or what its results will be for future periods. The results include the activities of the following acquired businesses since their respective dates of acquisition: REI, Ltd. from April 17, 1998; and CB Hillier Parker Limited from July 7, 1998.

 

    

Twelve Months Ended December 31,

     

Pro Forma for the Twelve Months
Ended
December 31,
2002

  
    

1998

     

1999

     

2000

     

2001 (1)

     

2002 (2)

     
    

(Dollars in thousands)

  

Statement of

Operations Data:

                                                      

Revenue

   

$

1,034,503

 

   

$

1,213,039

 

   

$

1,323,604

 

   

$

1,170,762

 

   

$

1,170,277

 

   

$

1,744,162

 

Operating income

   

 

78,476

 

   

 

76,899

 

   

 

107,285

 

   

 

49,058

 

   

 

106,477

 

   

 

129,342

 

Interest expense, net

   

 

27,993

 

   

 

37,438

 

   

 

39,146

 

   

 

38,962

 

   

 

46,043

 

   

 

76,013

 

Net income (loss)

   

 

24,557

 

   

 

23,282

 

   

 

33,388

 

   

 

(11,299

)

   

 

27,306

 

   

 

22,137

 

Other Data:

                                                      

Net cash provided by (used in) operating activities

   

$

76,005

 

   

$

70,340

 

   

$

80,859

 

   

$

(29,206

)

   

$

64,373

 

   

 

—  

 

Net cash used in investing activities

   

 

(222,911

)

   

 

(23,096

)

   

 

(32,469

)

   

 

(118,651

)

   

 

(24,130

)

   

 

—  

 

Net cash provided by (used in) financing activities

   

 

119,438

 

   

 

(37,721

)

   

 

(53,523

)

   

 

185,487

 

   

 

(17,453

)

   

 

—  

 

Ratio of earnings to fixed charges

   

 

2.17

x

   

 

1.79

x

   

 

2.16

x

   

 

1.18

x

   

 

1.86

x

   

 

—  

 

EBITDA, excluding nonrecurring
charges (3)

   

 

127,246

 

   

 

117,369

 

   

 

150,484

 

   

 

115,481

 

   

 

131,127

 

   

$

173,374

 

Adjusted EBITDA (3)

   

 

—  

 

   

 

—  

 

   

 

—  

 

   

 

—  

 

   

 

—  

 

   

 

207,374

 

Pro forma cash interest expense

   

 

—  

 

   

 

—  

 

   

 

—  

 

   

 

—  

 

   

 

—  

 

   

 

77,248

 

Ratio of Adjusted EBITDA to pro forma cash interest

   

 

—  

 

   

 

—  

 

   

 

—  

 

   

 

—  

 

   

 

—  

 

   

 

2.7

x

Ratio of pro forma
long-term debt (including current portion) to Adjusted EBITDA

   

 

—  

 

   

 

—  

 

   

 

—  

 

   

 

—  

 

   

 

—  

 

   

 

3.6

x

 

1

    

As of December 31,

   

Pro Forma
as of

December 31, 2002

    

1998

   

1999

   

2000

   

2001

   

2002

   
    

(Dollars in thousands)

Balance Sheet Data:

                                          

Cash and cash equivalents

   

$

19,551

   

$

27,844

   

$

20,854

   

$

57,447

   

$

79,574

   

$

199,893

Total assets

   

 

856,892

   

 

929,483

   

 

963,105

   

 

1,273,360

   

 

1,284,953

   

 

1,934,494

Long-term debt (including current portion)

   

 

388,896

   

 

364,637

   

 

314,164

   

 

472,630

   

 

459,981

   

 

751,870

Total liabilities

   

 

660,175

   

 

715,874

   

 

724,018

   

 

997,449

   

 

976,745

   

 

1,526,286

Total stockholders’ equity

   

 

190,842

   

 

209,737

   

 

235,339

   

 

271,615

   

 

302,593

   

 

402,593

(1)   The 2001 data provided has been derived by combining our activity for the period January 1, 2001 through July 20, 2001 (the date of the 2001 merger) with the activity of CBRE Holding (excluding CBRE Holding’s parent stand-alone activity) for the period from February 20, 2001 (inception) through December 31, 2001.
(2)   The 2002 data provided has been derived by excluding CBRE Holding’s parent-only stand-alone activity for the period.
(3)   EBITDA, excluding nonrecurring charges, represents earnings before interest expense, income taxes, depreciation and amortization of intangible assets relating to acquisitions and nonrecurring charges. Adjusted EBITDA represents pro forma EBITDA, excluding non-recurring charges, plus expected cost savings that we currently expect to achieve in connection with the Insignia acquisition. A description of these expected cost savings is provided under the caption “The Insignia Acquisition and Related Transactions” in Item 9. We cannot assure you, however, when or if any expected cost savings will be realized. We believe that the presentation of EBITDA, excluding nonrecurring charges, and Adjusted EBITDA will enhance an investor’s understanding of our operating performance. EBITDA is also a measure used by our senior management to evaluate the performance of our various lines of business and for other required or discretionary purposes, such as our use of EBITDA as a significant component when measuring performance under our employee incentive programs. Additionally, many of our debt covenants are based upon a measurement similar to EBITDA, excluding nonrecurring charges. EBITDA, excluding nonrecurring charges, and Adjusted EBITDA should not be considered as alternatives to (i) operating income determined in accordance with accounting principles generally accepted in the United States or (ii) operating cash flow determined in accordance with accounting principles generally accepted in the United States. Our calculation of EBITDA, excluding nonrecurring charges, and Adjusted EBITDA may not be comparable to similarly titled measures reported by other companies.

 

EBITDA, excluding nonrecurring charges, and Adjusted EBITDA are calculated as follows:

 

   

Twelve Months Ended December 31,

     

Pro Forma
for the Twelve
Months Ended
December 31, 2002

   

1998

   

1999

   

2000

   

2001

   

2002

     
   

(Dollars in thousands)

Operating income (loss)

  

$

78,476

   

$

76,899

   

$

107,285

   

$

49,058

   

$

106,477

     

$

129,342

Add:

                                           

Depreciation and amortization

  

 

32,185

   

 

40,470

   

 

43,199

   

 

37,854

   

 

24,614

     

 

43,996

   
  
  
  
  
    

EBITDA

  

 

110,661

   

 

117,369

   

 

150,484

   

 

86,912

   

 

131,091

     

 

173,338

Add:

                                           

Nonrecurring charges

  

 

16,585

   

 

—  

   

 

—  

   

 

28,569

   

 

36

     

 

36

   
  
  
  
  
    

EBITDA, excluding nonrecurring charges

  

$

127,246

   

$

117,369

   

$

150,484

   

$

115,481

   

$

131,127

     

 

173,374

   
  
  
  
  
        

Add:

                                           

Expected cost savings (*)

  

 

—  

   

 

—  

   

 

—  

   

 

—  

   

 

—  

     

 

34,000

                                        

Adjusted EBITDA

  

 

—  

   

 

—  

   

 

—  

   

 

—  

   

 

—  

     

$

207,374

                                        

 

2

(*)   We have undergone a substantial review of our and Insignia’s combined operations in order to identify areas of overlap. During 2002, Insignia incurred approximately $34.0 million of costs related to (1) the compensation of senior executive management personnel who will not join CBRE Holding after the Insignia acquisition, (2) administrative and support costs associated with those executives and (3) human resources, accounting and other administrative functions that overlap with ours. We expect to eliminate these costs as part of a detailed integration plan developed in connection with the Insignia acquisition. We expect to achieve the majority of these cost savings upon the closing of the Insignia acquisition. However, we cannot assure you as to when or if these expected cost savings will be realized. As we continue to implement our integration plan, a portion of the costs that we expect to save may relate to the elimination of certain of our own personnel. See “Risk Factors—Risks Relating to Our Business—We cannot assure you as to when or if we will be able to achieve all of our expected cost savings in connection with the Insignia acquisition” in Item 9.

 

CBRE Holding

 

The following table is a summary of the historical consolidated financial data of CBRE Holding as of and for the period presented, as well as pro forma financial data giving effect to the Insignia acquisition and the related transactions as of and for the period presented. The pro forma statement of operations data do not purport to represent what CBRE Holding’s results of operations would have been if the Insignia acquisition and the related transactions had occurred as of the date indicated or what its results will be for future periods.

 

    

Twelve Months Ended December 31, 2002

     

Pro Forma for the Twelve Months Ended December 31, 2002

    

(Dollars in thousands)

Statement of Operations Data:

                

Revenue

   

$

1,170,277

     

$

1,744,162

Operating income

   

 

106,062

     

 

128,927

Interest expense, net

   

 

57,229

     

 

87,199

Net income

   

 

18,727

     

 

13,558

Other Data:

                

EBITDA, excluding nonrecurring charges (1)

   

$

130,712

     

$

172,959

Adjusted EBITDA (1)

   

 

—  

     

 

206,959

    

December 31, 2002

     

Pro Forma as of December 31, 2002

    

(Dollars in thousands)

Balance Sheet Data:

                

Cash and cash equivalents

   

$

79,701

     

$

200,020

Total assets

   

 

1,324,876

     

 

1,974,417

Long-term debt (including current portion)

   

 

521,844

     

 

813,733

Total liabilities

   

 

1,067,920

     

 

1,617,461

Total stockholders’ equity

   

 

251,341

     

 

351,341

(1)  

EBITDA, excluding nonrecurring charges, represents earnings before interest expense, income taxes, depreciation and amortization of intangible assets relating to acquisitions and nonrecurring charges. Adjusted EBITDA represents pro forma EBITDA, excluding non-recurring charges, plus expected cost savings that we currently expect to achieve in connection with the Insignia acquisition. A description of these expected cost savings is provided under the caption “The Insignia Acquisition and Related Transactions” in Item 9. We cannot assure you, however, when or if any expected cost savings will be realized. We believe that the presentation of EBITDA, excluding nonrecurring charges, and Adjusted EBITDA will enhance a reader’s understanding of CBRE Holding’s operating performance. EBITDA is also

 

3

 

a measure used by our senior management to evaluate the performance of our various lines of business and for other required or discretionary purposes, such as our use of EBITDA as a significant component when measuring performance under our employee incentive programs. Additionally, many of CBRE Holding’s debt covenants are based upon a measurement similar to EBITDA, excluding nonrecurring charges. EBITDA, excluding nonrecurring charges, and Adjusted EBITDA should not be considered as alternatives to (i) operating income determined in accordance with accounting principles generally accepted in the United States or (ii) operating cash flow determined in accordance with accounting principles generally accepted in the United States. CBRE Holding’s calculation of EBITDA, excluding nonrecurring charges, and Adjusted EBITDA may not be comparable to similarly titled measures reported by other companies.

 

EBITDA, excluding nonrecurring charges, and Adjusted EBITDA are calculated as follows:

 

      

Twelve Months

Ended

December 31, 2002

     

Pro Forma for the

Twelve Months Ended

December 31, 2002

      

(Dollars in thousands)

Operating income (loss)

     

$

106,062

     

$

128,927

Add:

                  

Depreciation and amortization

     

 

24,614

     

 

43,996

      
    

EBITDA

     

 

130,676

     

 

172,923

Add:

                  

Nonrecurring charges

     

 

36

     

 

36

      
    

EBITDA, excluding nonrecurring charges

     

$

130,712

     

 

172,959

      
        

Add:

                  

Expected cost savings(*)

     

 

—  

     

 

34,000

               

Adjusted EBITDA

     

 

—  

     

$

206,959

               
(*)   We have undergone a substantial review of our and Insignia’s combined operations in order to identify areas of overlap. During 2002, Insignia incurred approximately $34.0 million of costs related to (1) the compensation of senior executive management personnel who will not join CBRE Holding after the Insignia acquisition, (2) administrative and support costs associated with those executives and (3) human resources, accounting and other administrative functions that overlap with ours. We expect to eliminate these costs as part of a detailed integration plan developed in connection with the Insignia acquisition. We expect to achieve the majority of these cost savings upon the closing of the Insignia acquisition. However, we cannot assure you as to when or if these expected cost savings will be realized. As we continue to implement our integration plan, a portion of the costs that we expect to save may relate to the elimination of certain of our own personnel. See “Risk Factors—Risks Relating to Our Business—We cannot assure you as to when or if we will be able to achieve all of our expected cost savings in connection with the Insignia acquisition” in Item 9.

 

4