Cbre Group Inc · NYSE:CBRE
Cbre — CB Richard Ellis Group — Q1 2007 Earnings Presentation
26 slides from Cbre's earnings presentation, May 2, 2007
Slide 1: First Quarter 2007 Earnings Conference Call
CB Richard Ellis Group, Inc. First Quarter 2007 Earnings Conference Call May 2, 2007
Slide 2: Forward Looking Statements
Forward Looking Statements This presentation contains statements that are forward looking within the meaning of the Private Securities Litigation Reform Act of 1995, including statements regarding our growth momentum in 2007, future operations, the impact of acquisitions and future financial perform
Slide 3: Conference Call Participants
Conference Call Participants Brett White, President and Chief Executive Officer Kenneth J. Kay, Sr. Executive Vice President & Chief Financial Officer Diane Paddison, President, Global Corporate Services - Client Accounts Shelley Young, Director, Investor Relations
Slide 4: Q1 2007 Summary
Q1 2007 Summary Record performance underscores the significant power of the enhanced global platform and initial success in integrating the Trammell Crow Company Continued growth in the outsourcing business through major account wins and expansion of existing client relationships Exceptional perform
Slide 5: Q1 2007 Performance Highlights
Q1 2007 Performance Highlights Revenue $1.2 billion $462.7 million, or 62% higher than the prior year quarter More than one-half of the revenue increase was organic 18th straight quarter of double-digit year-over-year organic revenue growth ($24.9) million, or 68% lower than the same quarter last ye
Slide 6: Q1 2007 Financial Results
Q1 2007 Financial Results Excludes Trammell Crow Company’s operations, which were not purchased until 12/20/2006. Includes Trammell Crow Company’s operations prior to the acquisition on 12/20/2006. The financial information including Trammell Crow Company is presented for informational purposes only
Slide 7: 2007 Revenue Breakdown
2007 Revenue Breakdown 1st Quarter, 2007 Excludes Trammell Crow Company’s operations, which were not purchased until 12/20/2006. Includes Trammell Crow Company’s operations prior to the acquisition on 12/20/2006. The financial information including Trammell Crow Company is presented for informationa
Slide 8: Normalized EBITDA Margins
Normalized EBITDA Margins Significant margin improvement Note: EBITDA margins exclude merger-related costs, integration expenses related to acquisitions and loss on sale of trading securities acquired in the Trammell Crow Company acquisition . 19% 10% 0 5 10 15 20 2006 2007 2006 11.2 14.8 2007 13.3
Slide 9: Q1 2007 Earnings Per Share Dynamics
Q1 2007 Earnings Per Share Dynamics1 1. All EPS information is based upon diluted shares. GAAP EPS Integration costs related to acquisitions Adjusted EPS $0.05 $0.03 $0.27 Loss on sale of trading securities acquired in the Trammell Crow Company acquisition $0.08 Merger-related charges $0.08 Amortiza
Slide 10: Consolidated Balance Sheets
Consolidated Balance Sheets Represents Freddie Mac loan receivables, which are offset by the related non-recourse warehouse line of credit facility. Includes real estate and other assets held for sale, real estate under development and real estate held for investment. ($ in millions) 3/31/2007 12/31
Slide 11: Consolidated Balance Sheets (cont.)
Consolidated Balance Sheets (cont.) Represents the non-recourse warehouse line of credit facility, which supports the Freddie Mac loan receivables. Includes recourse notes payable on real estate of $17.0 million and $17.4 million at March 31, 2007 and December 31, 2006, respectively. ($ in millions)
Slide 12: Capitalization
Capitalization Represents notes payable on real estate in Development Services that are recourse to the Company. Excludes non-recourse notes payable on real estate of $369.0 million and $329.6 million at March 31, 2007 and December 31, 2006, respectively. Excludes $27.2 million and $104.0 million of
Slide 13: Strong cash flow generator
Strong cash flow generator Low capital intensity Utilization of internal cash flow Debt reduction Co-investment activities Development In-fill acquisitions Q1 2007 Trailing Twelve Months Normalized Internal Cash Flow ($ millions) 373 Net Income, as adjusted D&A Cap Ex (39) 601 Represents capital exp
Slide 14: CBRE Recent Wins
CBRE Recent Wins The Blackstone Group Represented The Blackstone Group in the sale of a five building, 2.8 million sq. ft. Denver office portfolio Appointed as leasing and management agent by the buyer, Callahan Capital Partners IVG, Immobilien AG Advised IVG, Immobilien on the purchase of Swiss Re
Slide 15: Q1 2007 Segment Performance – Americas, EMEA and Asia Pacific
Q1 2007 Segment Performance – Americas, EMEA and Asia Pacific $791.9 ($ In millions) Revenue1 Normalized EBITDA2 Americas EMEA Asia Pacific $493.4 $225.3 $164.7 $94.0 $62.8 $84.2 $55.4 $37.3 $19.9 $9.5 $2.1 61% 37% 50% 52% 87% 2007 2006 352% Certain reimbursements (primarily salaries and related cos
Slide 16: Q1 2007 Segment Performance – Global Investment Management
Q1 2007 Segment Performance – Global Investment Management 1st Quarter CAGR: 41.4% CAGR: 181.6% ANNUAL REVENUE REVENUE 127.3 Carried Interest Investment Management CAGR: 26.2% CBRE’s Assets Under Management ($ in Billions) 85.6 228.0 CAGR: 489.4% EBITDA ($ in millions) 30.4 4.9 46.4 25.5 39.2 4.9 0
Slide 17: Global Investment Management Carried Interest
Global Investment Management Carried Interest Carried interest pertains to certain real estate investment funds from which CBRE earns an additional share of the profits from the fund once its performance meets certain financial hurdles Dedicated fund team leaders and executives in our investment man
Slide 18: Q1 2007 Segment Performance - Development Services
Q1 2007 Segment Performance - Development Services ($ in billions) Projects In Process/Pipeline 1st Quarter Activities ($ in millions) New Project Starts 2.2 2.3 3.8 1.4 5.0 2.0 4.9 2.3 3.6 1.4 2.8 1.5 2.6 2.5 3.6 2.7 5.4 3.0 5.5 2.9 0 1 2 3 4 5 6 7 8 9 4Q98 4Q99 4Q00 4Q01 4Q02 4Q03 4Q04 4Q05 4Q06 1
Slide 19: Summary
Summary Major markets around the world remain strong, fueled by global economic expansion, substantial marketplace liquidity and increased cross-border capital flows Rental rates continue to rise in key markets around the world Success in client base and market share expansion Trammell Crow Company
Slide 20: Appendix
Appendix
Slide 21: Reconciliation of Net Income to Net Income, As Adjusted
Reconciliation of Net Income to Net Income, As Adjusted ($ in millions) 2007 2006 Net income 12.0 36.9 Amortization expense related to net revenue backlog, incentive fees and customer relationships acquired, net of tax 6.4 2.3 Integration costs related to acquisitions, net of tax 7.3 0.9 Loss on sal
Slide 22: Reconciliation of Normalized EBITDA to EBITDA to Net Income
Reconciliation of Normalized EBITDA to EBITDA to Net Income ($ in millions) 2007 2006 Normalized EBITDA 161.9 84.0 Adjustments: Integration costs related to acquisitions 12.1 1.3 Loss on sale of trading securities acquired in the Trammell Crow Company acquisitions 33.7 - Merger-related costs 31.8 -
Slide 23: Reconciliation of Normalized EBITDA to EBITDA to Net Income (TTM)
Reconciliation of Normalized EBITDA to EBITDA to Net Income ($ in millions) Q1 2007 Q1 2006 Normalized EBITDA 730.4 492.6 Adjustments: Integration costs related to acquisitions 18.4 5.9 Loss on sale of trading securities acquired in the Trammell Crow Company acquisition 25.1 - Merger-related charges
Slide 24: Reconciliation of Net Income to Net Income, As Adjusted (TTM)
Amortization expense related to net revenue backlog, incentive fees and customer relationships acquired1 Integration costs related to acquisitions1 Loss related to trading securities acquired in the Trammell Crow Company acquisition1 Merger-related charges1 Costs of extinguishment of debt1 Reconcili
Slide 25: Reconciliation of Normalized EBITDA to EBITDA to Net Income (Loss) by segment
Reconciliation of Normalized EBITDA to EBITDA to Net Income (Loss) Three Months Ended March 31, 2006 ($ in millions) Americas EMEA Asia Pacific Global Investment Management Development Services Normalized EBITDA 55.4 19.9 2.1 6.6 - Less: Integration costs related to acquisitions 0.8 0.5 - - EBITDA 5
Slide 26: CB Richard Ellis
CBRE CB RICHARD ELLIS
CB Richard Ellis Group — Q1 2007 Earnings Presentation on 6ix