Jones Lang Lasalle Incorporated · NYSE:JLL
Jones Lang Lasalle — Investor Presentation (February 2015)
33 slides from Jones Lang Lasalle's investor presentation, Feb 27, 2015
Slide 1: February 2015 Investor Presentation
February 2015 Investor Presentation Working together to create value in the world of real estate 58,000 employees, 230 offices, 80 countries, 1 global brand
Slide 2: Our Differentiators
2 Our Differentiators • Growth-oriented, globally integrated firm o Advisor and service provider o Local, regional and global market execution o Corporate outsourcing partner o Premier global real estate investment (LaSalle) • Operational excellence o Productivity focus o Broad research capabilities
Slide 3: How we got here - premier brand and global platform
3 Jones Lang Wootton founded 1783 1968 1997 1999 LaSalle Partners founded LaSalle Partners initial public offering LaSalle Partners and Jones Lang Wootton merge to create Jones Lang LaSalle Integrated global platform (NYSE ticker “JLL”) 2008 The Staubach Company and Jones Lang LaSalle combine operat
Slide 4: What we have accomplished
4 Fee Revenue ~4x 2004 2014 Note: All amounts in $ millions. 2004 market cap based on peak share price in the year. Current market cap based on February 2015 share price. Long history of profitable revenue growth • 10-year compound annual revenue growth = 17%; 80% organic and 20% from M&A • 60+ me
Slide 5: How we earn fees
5 How we earn fees Leasing Broker transactions between tenants & landlords Driven by economic growth and corporate confidence Capital Markets & Hotels Investment sales & finance arrangements Driven by investor allocations to real estate and market liquidity Property & Facility Management Management
Slide 6: Diversified and integrated global services
6 Integrated Products Leasing Advisory & Other LaSalle Inv. Mgmt. Property & Facility Mgmt. Project & Development Services Capital Markets 33% 10% 8% 9% 17% Global Diversification EMEA (31%) Other Asia United Kingdom France Germany Other Europe Japan Greater China (incl. Hong Kong) Australia India S
Slide 7: Real Estate Services revenue by segment
7 Note: Segment and Consolidated Real Estate Services (“RES”) operating revenue exclude Equity earnings (losses). Fee revenue presentation of Property & Facility Management, Project & Development Services and Total RES Operating Revenue excludes gross contract costs. Leasing $1,039.5 19% $295.2
Slide 8: JLL Research 2015 market volume outlook
8 Leasing Activity Mixed; Outlook Consistent Investment Volumes Strength Continues; Outlook Revised HISTORICAL OUTLOOK Capital Markets(1) Q4 2014 v. Q4 2013 FY 2014 v. FY 2013 FY 2015 v. FY 2014 Market Volumes Americas 7% 25% ~ 15% EMEA 8% 25% - 5% (2) Asia Pacific 17% 3% 5-10% Total 9% 20% 5-10% HI
Slide 9: 2015 Market tone and JLL priorities
9 2015 Market Tone • Market conditions (source JLL Research) o Major global real estate markets driving significant activity o Demand for direct real estate investment to continue into 2015 o Corporate occupier activity continues to strengthen o Financing markets remain liquid; interest rates low •
Slide 10: Driving to Strategy 2020
10 Driving to Strategy 2020 Our strategy for continued success • Balance top-line growth, platform investments and productivity to maximize profit • Leverage global position and industry consolidation to invest strategically and grow market share • Increase productivity and manage costs to improve m
Slide 11: Investment thesis
11 • Long-term revenue growth • Market share gains • Margin accretion Growth Focused • Infrastructure leverage • Occupancy • IT investments Productivity Mindset • Superior client relationships • Collaborative, experienced and deep leadership bench • Highest ethical standards and commitment to divers
Slide 12: G1 - Scale and leadership in local markets
12 G1 - Scale and leadership in local markets *July 2008: Staubach Company acquired, annual revenue = $375 million **May 2011: King Sturge acquired, annual revenue = $260 million Asia Pacific EMEA Americas ($ in millions) Competitive Advantages • Leasing: Proven market share growth o Transformative
Slide 13: G2 - Global outsourcing propels Corporate Solutions
13 G2 - Global outsourcing propels Corporate Solutions Note: Reimbursable vendor, subcontractor and out-of-pocket costs reported as revenue and expense in JLL financial statements have been increasing steadily. Margins diluted as gross-accounting requirements increase revenue and costs without corre
Slide 14: G3 - Capturing market share in growing global capital flows
14 * May 2011: King Sturge acquired, annual revenue = $260 million Asia Pacific EMEA Americas ($ in millions) Competitive Advantages • Market share gains across geographies • Strong global market positions • Significant investment allocated to grow U.S. platform • International Capital Group capture
Slide 15: G4 - Performance drives LaSalle Investment Management
15 Competitive Advantages • Successful capital raise; nearly $9 billion committed in 2014 • Proven performance history with long-standing client relationships • Diversified global platform • Financial backing of well-capitalized parent company • Magnitude of combined incentive fees and equity earnin
Slide 16: Strong balance sheet
16 • Investment grade ratings; Baa2 (Stable) / BBB (Stable) o In December 2014, Standard & Poor’s raised JLL’s credit rating to BBB o Low debt cost: FY 2014 net interest expense of $28m down from $35m for FY 2013 o Renewed bank credit facility in February 2015; increased size to $2.0 billion and mat
Slide 17: Continued investment for long term growth
17 (1) Includes deferred business acquisition payments and earn outs paid during the period for transactions closed in prior periods (2) Includes distributions of $62M partially offset by capital contributions of $56M (3) Excludes investments in joint venture entities, capitalized leases and tenant
Slide 18: Consolidated earnings scorecard
18 2013 $285M $6.32 $389M / 9.7% $4.0B US GAAP: $269M US GAAP: $5.98 $369M / 9.2% Gross revenue: $4.5B FY 2014 Performance Notes: (1) 2013 and 2012 adjusted for restructuring and intangible amortization. Margin is calculated on a fee revenue basis. (2) Percentage growth reflective of change in local
Slide 19: Americas Real Estate Services
19 2014 Fee Revenue Operating Income $219M Operating Income Margin 10.4% Adjusted EBITDA $275M Adjusted EBITDA Margin 13.0% Gross revenue : $2.3B 2013 $184M 10.2% $229M 12.7% $1.8B $2.1B FY 2014 Performance 2014 Revenue Contribution Note: Margin is calculated on a fee revenue basis. See Appendix for
Slide 20: EMEA Real Estate Services
20 2014 Fee Revenue Adj. Operating Income $123M Adj. Operating Income Margin 9.3% Adjusted EBITDA $145M Adjusted EBITDA Margin 11.0% Gross revenue : $1.6B 2013 $92M 8.2% $110M 9.8% $1.1B $1.3B FY 2014 Performance 2014 Revenue Contribution Note: Operating income has been adjusted to exclude $2.0 and
Slide 21: Asia Pacific Real Estate Services
21 Asia Pacific Real Estate Services 2014 Fee Revenue Operating Income $84M Operating Income Margin 9.3% Adjusted EBITDA $98M Adjusted EBITDA Margin 10.7% Gross revenue : $1.1B 2013 $77M 9.1% $90M 10.6% $848M $909M FY 2014 Performance 2014 Revenue Contribution Note: Margin is calculated on a fee rev
Slide 22: LaSalle Investment Management
22 2014 Revenue Operating Income $132M Operating Income Margin 31.8% Adjusted EBITDA $134M Adjusted EBITDA Margin 32.3% 2013 $68M 23.7% $70M 24.4% $286M • Winning new mandates and clients while selling vintage funds for investor performance and JLL equity earnings • Advisory fee outlook remains stab
Slide 23: Appendix
Appendix
Slide 24: JLL Property Clocks
24 as of Q4 2014 Leasing Values (1) Asia Pacific EMEA Americas as of Q4 2014 Capital Values (2) JLL Property ClocksSM Capital Value growth slowing Capital Value growth accelerating Capital Values bottoming out Capital Values falling Hong Kong, Toronto Singapore, Houston Shanghai, Washington DC, Mexi
Slide 25: Q4 and FY 2014 performance
25 Note: Equity earnings of $7.3M and $48.3M in Q4 2014 and FY 2014, respectively, are included in segment results, however, excluded from Consolidated totals. Year-over-year increases shown fee-based have been calculated using fee revenue, which excludes gross contract costs. Segment YOY Growth Fee
Slide 26: Adjusted EBITDA Q4 and FY 2014 performance
26 Refer to page A-5 for Reconciliation of GAAP Net Income to Adjusted EBITDA for the three months ended and twelve months ended December 31, 2014, for details relative to these Adjusted EBITDA calculations. Segment Adjusted EBITDA is calculated by adding the segment’s depreciation and amortization
Slide 27: Q4 2014 Real Estate Services revenue (local currency)
27 Note: Segment and Consolidated Real Estate Services (“RES”) operating revenue exclude Equity earnings (losses). Fee revenue presentation of Property & Facility Management, Project & Development Services and Total RES Operating Revenue excludes gross contract costs. Q4 2014 Real Estate Services re
Slide 28: Full Year 2014 Real Estate Services revenue
28 Note: Segment and Consolidated Real Estate Services (“RES”) operating revenue exclude Equity earnings (losses). Fee revenue presentation of Property & Facility Management, Project & Development Services and Total RES Operating Revenue excludes gross contract costs. Full Year 2014 Real Estate Serv
Slide 29: Q4 2014 Real Estate Services revenue (USD)
29 Note: Segment and Consolidated Real Estate Services (“RES”) operating revenue exclude Equity earnings (losses). Fee revenue presentation of Property & Facility Management, Project & Development Services and Total RES Operating Revenue excludes gross contract costs. Q4 2014 Real Estate Services re
Slide 30: Fee revenue and adjusted operating income margin calculation
30 ($ in millions) 2014 2013 2014 2013 Consolidated Revenue 1,749.0$ 1,509.4$ 5,429.6$ 4,461.6$ Consolidated Operating Expenses 1,487.2 1,313.6 4,963.9 4,092.8 Adjusted Operating Income Margin 15.1% 13.3% 9.4% 8.7% Gross Contract Costs: Property & Facility Management 56.3 36.4 207.6 111.1 Project &
Slide 31: Reconciliation of GAAP net income to adjusted net income and EPS
31 2014 2013 2014 2013 193.8$ 147.2$ 385.7$ 269.5$ 45,332 45,146 45,261 45,072 4.28$ 3.26$ 8.52$ 5.98$ 193.8$ 147.2$ 385.7$ 269.5$ 0.8 2.6 6.0 13.7 0.3 0.4 1.5 1.6 194.9$ 150.2$ 393.2$ 284.8$ 45,332 45,146 45,261 45,072 4.30$ 3.33$ 8.69$ 6.32$ Adjusted diluted earnings per share Three Months Ended D
Slide 32: Reconciliation to adjusted operating income and adjusted EBITDA
32 Reconciliation of GAAP operating income to adjusted operating income and net income to adjusted EBITDA 2014 2013 2014 2013 261.8$ 195.8$ 465.7$ 368.8$ 1.1 3.6 42.5 18.3 0.4 0.6 2.0 2.2 263.3 200.0 510.2 389.3 194.8$ 147.5$ 388.0$ 273.4$ 6.7 8.1 28.3 34.7 67.7 50.4 97.6 92.1 27.1 20.9 94.4 79.8 29
Slide 33: Forward-looking statements
33 Statements in this presentation regarding, among other things, future financial results and performance, achievements, plans and objectives and dividend payments may be considered forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statement
Jones Lang LaSalle — Investor Presentation (February 2015) on 6ix