Cbre Group Inc · NYSE:CBRE
Cbre — CB Richard Ellis Group — Q4 2005 Earnings Presentation
27 slides from Cbre's earnings presentation, Feb 2, 2006
Slide 1: CB Richard Ellis Group, Inc. Fourth Quarter 2005 Earnings Conference Call
CB Richard Ellis Group, Inc. Fourth Quarter 2005 Earnings Conference Call February 2, 2006 100=== CBRE CB RICHARD ELLIS
Slide 2: Forward Looking Statements
Forwa' ooking 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 2005 and 2006, future operations and future financial performance. These statement
Slide 3: Conference Call Participants
Conference Call Participants Brett White, President & Chief Executive Officer Ken Kay, Senior Executive VP & Chief Financial Officer Jim Reid, President, Eastern Region (U.S.) Shelley Young, Director, Investor Relations 100 CBRE 2 CB RICHARD ELLIS
Slide 4: Record financial performance
Record financial performance Favorable macro-market conditions Increased market share ® Extensive service offering ® Global reach © Premier brand equity 100: CBRE CB RICHARD ELLIS
Slide 5: Q4 2005 Performance Highlights
Q4 2005 Performance Highlights R $956 million = $157.8 million, or 20% higher than the prior year quarter evenue = 13° straight quarter of double-digit year-over-year organic revenue growth Net GAAP: $95.4 million + $29.0 million, or 44% higher than the prior year quarter Income Adjusted: $99.9 mill
Slide 6: Q4 Financial Results
Q4 Financial Results {Sin itions) 2005 2004 _% Change Revenue 956.0 798.2 20 Cost of Senices 492.4 406.2 19 Operating, Administrative & Other 302.0 266.9 13 Equity Income from Unconsolidated Subsidiaries 15.0 98 53 Minority Interest Expense 04 05 (20) EBITDA 196.2 1344 39 ‘One Time Charge Integratio
Slide 7: Full Year Financial Results
Full Year Financial Results inmiions) 2005 2004 __% Change Revenue 29106 2,365.1 23 Cost of Senices 4,470.1 1,203.8 22 Operating, Administrative & Other 1,022.6 909.9 12 Equity Income from Unconsolidated Subsidiaries 38.4 21.0 83 Minofity interest Expense 24 18 40 Merger-Related Charges : 256 NA EBI
Slide 8: 2005 Revenue Breakdown
2005 Revenue Breakdown 4th Quarter, 2005 6% 2% 39% Three monn endea December 31 ‘ear ended Decemer 3 (Sinmuions) 205 2004 Change 2005 2004 Change sacs wue2 2835 tema eora 3 Bh essing mr 313 \@ 44058863 2 HE Propertyand Faciites Management 507 521 8 200s 1853 3 Hi pooraisl ane Vauaton ses 18 meds = T
Slide 9: Full Year EBITDA Margins
Full Year EBITDA Margins Significant margin improvement: 00. * 4 quarter EBITDA margin was 19.6% compared to 17.2% for the same quarter last year, an improvement of 14% " 24% improvement on 2005 full year EBITDA margin compared fo 2004 Norm alized EBITDA Margin 10% 158% 16% - 14% ea ea 2001 2002-200
Slide 10: Q4 Earnings Per Share Dynamics
Q4 Earnings Per Share Dynamics’ 2004 2005 (0.02) $0.02 = um oo iE GAAP insignia Amortization Tax adhustments Adjusted of eS —_ltegration telatingto EPS. ‘charges Insignlanet Insignia merger. ‘ewenue related charges, backlog PO and extinguishment ‘of debt casts
Slide 11: Full Year Earnings Per Share Dynamics
Full Year Earnings Per Share Dynamics’ 2004 2005 som et = $005 oo sora $185 os sz i ow 03 ost a ‘GAAP nsinia Amortization insignia ___Costgot_po_Adusted | GAAP —_Wslanla_Coateaf _Taxomponso Adjusted TPS, tegration “Ge merger related extinguishment coats NEPS EPS itgraton extngasmen rotated othe char
Slide 12: Consolidated Balance Sheets
Consolidated Balance Sheets As of, (Sinnatons) 12/81/2005 12/31/2004 Variance Assets Cash and cash equivalents 449.3 2569 1924 Restricted cash 52 92 (40) Receivables, net 483.2 394.4 89.1 ‘Warehouse receivable! 256.0 138.2 1178 Property and equipment, net 137.6 137.7 4) Goodwill and other intangible
Slide 13: Consolidated Balance Sheets (continued)
lated Balance Sheets (con Asof (Sinrions) 12/31/2005 12/31/2004 _Variance Liabilities Current iabiities, excluding debt 873.6 6372 236.4 ‘Warehouse line of credit’ 256.0 1382 1178 Senior secured term loantranche B 265.2 2774 (11.9) 11% senior subordinated notes 163.0 205.0 42.0) 94% senior notes 130
Slide 14: Capitalization
Capitalization Asof (Sin itor) 12/31/2005 _12/31/2004__Variance Cash 449.3 2569 192.4 Senior secured term loan tranche B 265.2 274 (19) 11% senior subordinated notes 163.0 205.0 (42.0) 9°% senior notes 130.0 130.0 - Other debt! 19.0 225 5) Total debt 877.2 634.6 674) Stockholders’ equity 793.7 560.0
Slide 15: 2005 Normalized Internal Cash Flow
2005 Normalized Internal|Cash Flow senees) = Strong cash flow generator * $110 million, or 82.7% improvement from prior year = Low capital intensity " Utilization of internal cash flow * Debt reduction *» Co-investment activities * Infill acquisitions Not Income, as adjusted Internal Cash Flow 1. Re
Slide 16: 2005 Acquisitions
Eaoyburo SAS France) ‘compote Ftout ana Reocaton 02,2005 (03,2005. alge (Unies Kingdom) Fetal Advisor Senicos ‘4, 2005, a Furter& suit aust) RotallAdsory Services TKOMA Gapar) DTZ Queensland (australa) ‘valuation 4, 2005 ‘Colurbus CoreneciatReaty (Ohio) ‘Adsory Santee, Prop. Mgmt, 03, 2005 = Purchas
Slide 17: 2006 Guidance
2006 Guidance As compared to 2005 results, the Company expects to generate full year 2006.diluted earnings per share’ growth of approximately 15 —20% 4. Excluding onetime acquisition related and debt buy-back charges. 100 CBRE
Slide 18: Q4 Segment Performance
Q4 Segment Performance {in § millions) Americas EMEA Asia Pacific 18% we 12% ‘al ae | Sst $8240 1659 92192 $504 $58.4 S80 $564 < é ‘ib ee 12% 50% | Pa ee a fr] g 2 $755 S054 $345 $603 sto si12 S168 $262 2004 ME 2005 100: : CBRE CB RICHARD ELLIS
Slide 19: CBRE Recent Wins
CBRE Recent Wins RMB Realty ~ Represented RMB Realty in the $705 million sale of the Helmsley Building, one of the largest office building sales in New York City history. + Barclays Global Investors ~ Represented Barclays Global Investors for a 15-year lease on a 321,500 sq.ft. building. Thisis the
Slide 20: 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 hurdies = Dedicated fund team leaders and executives have been granted
Slide 21: Favorable Trends
Favorable Trends Investment Sales | * Investor demand continues to exceed the available supply of properties globally * Capital flows into commercial real estate continue at heightened levels Leasing Markets. | * Solid corporate hiring and strong net absorption of commercial real estate amid favorab
Slide 22: Appendix
Appendix
Slide 23: Reconciliation of Net Income to Net Income, As Adjusted
Reconciliation of Net Income to Net Income, As Adjusted Thee Months Ended Dec. 31, Year Ended Dec. 31, {Sin itions) 7005 2004 2005, 2008 ‘Net income 354 4 273 647 Loss: ‘Amortization expense related to et revenue backlog ‘scquied in the Insignia acquisition, net of tox oe a = ‘Mergerlated charges re
Slide 24: Reconciliation of Normalized EBITDA to EBITDA to Net Income
Reconciliation of Normalized EBITDA to EBITDA to Net Income {Sin eilions) 2005 2008 ‘Nonmalized EBITDA, 187.1 1370 Less Integration costs related to the Insignia acquisition 08 26 EBmTOA 1982 1344 on Interest income aa 28 Less Depreciation and amortization nz 149 Interest expense 135 1a Provision fo
Slide 25: Reconciliation of Normalized EBITDA to EBITDA to Net Income (Loss)
Reconciliation of Normalized EB: A to EBITDA to Net Income (Loss), — —————— Insignia acquisition so bad 138) i - terme ee, 100 . CBRE
Slide 26: Reconciliation of Normalized EBITDA to EBITDA to Operating Income
Reconciliation of Normalized EBITDA to EBITDA to Operating Income Taso me Tatoo Tob aston rape nmin) 28 oo. 2 200 05 “so "B05 2 pty neon tom ° oe 03 a oa o o7 co Mortara 02 on on os @» oa @ Basta esare En on co Eu = rH Evy a 100 CBRE 25 CB RICHARD ELLIS
Slide 27: Searchable text section of graphics shown above
Searchable text section of graphics shown above [GRAPHIC] CB Richard Ellis Group, Inc. Fourth Quarter 2005 Earnings Conference Call February 2, 2006 A CENTURY OF SERVICE [LOGO] 1906 | 2006 Fo rward Looking Statements This presentation contains statements that are forward looking within the meaning o
CB Richard Ellis Group — Q4 2005 Earnings Presentation on 6ix