Cbre Group Inc · NYSE:CBRE
Cbre — CB Richard Ellis Group — Q1 2005 Earnings Presentation
25 slides from Cbre's earnings presentation, May 5, 2005
Slide 1: First Quarter 2005 Financial Results
First Quarter 2005 Financial Results Earnings Conference Call May 5, 2005 CBRE
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. These statements should be considered as estimates onl and actual results } may ultimately iter rom these estimates. Except to the e
Slide 3: Conference Call Participants
inference Call Participants Brett White, President Ken Kay, Senior Executive Vice President and Chief Financial Officer Cal Frese, President, Americas Shelley Young, Director of Investor Relations CBRE 2 CE RICHARD ELS
Slide 4: Q1 2005 Performance Highlights
Q1 2005 Performance Highlights _ = = Revenue totaled $538.3 million, 22% higher than the prior year quarter = 10th straight quarter of double-digit year-over-year organic revenue growth = Netincome totaled $14.6 million, as compared to a net loss of $16.6 million for the same quarter last year % Exc
Slide 5: Q1 2005 Performance
Q1 2005 Performan " Operating income totaled $36.6 million, as compared to an operating loss of $9.3 million for the same quarter last year = EBITDA totaled $50.2 million, as compared to $10.1 million for the same quarter last year * EBITDA, excluding one-time Insignia related costs, totaled §52.7 m
Slide 6: Q1 2005 income statement and EBITDA summary
(Sinrriions) 2005 2004 _% Change Revenue 538.3 aio 2 Cost of Senices 268.1 224.2 20 Operating, Adminstratie & Other 228.2 199.2 12 Ecuity Income in Unconsalidated Subsidiaries 32 25 28 MergerRelated Charges = 10.0 ra EBITDA 50.2 10.4 397 One Time insignia Related Charges: Merger Related Charges - 10
Slide 7: 2005 Revenue Breakdown
1) 2005 Revenue Breakdi o% 4% 1% ee 34% 9% 38% inion 2005-2004 % Change Sales 1821 138.7 at WH Leasing 2055 © 192.2 7 Property and Facilities Management 602 434 16 TB Appraisal and Valuation 411 308 33 = Commercial Mortgage Brokerage M4 182 105 Investment Management a4 169 25 Other 72 38 89 Total 03
Slide 8: EBITDA Margins
ed EBITDA Margins 180 Continued margin improvement due to: 120 = Robust revenue growth am ™ Operating leverage EBITDA margins improved by approximately 25% above the same 40 quarter fast year oo TM tat Quarter ESITDA Margin feooa 108 zoos cE] 2004 2005 Notes: pues Sane
Slide 9: Earnings Per Share Dynamics
| Earnings Per Share Dynamics’ 4, EPS information ie bazed upon dlted shares fone 3035 o. on sericton [ I i rcs sits ines gga GAP ieferaion margereited never MEE ee se = a (25 GP gn eunglstee “ES Soar ea a ~ = (3025) f008 CBRE
Slide 10: Consolidated Balance Sheets
nsolidated Balance Sheets Asof @ h mitre) 331/05 12/91/2004 Variance Assets Cash and cash equivalents 1578 266.9 a 1) Restricted cash a4 92 0.1) Receivables, net 203.8 3041 (100.3) Warehouse receivable" 43.8 138.2 ws 4) Property and equipment, net 1348 1377 3.1) Goodwill and other intangible assets,
Slide 11: Consolidated Balance Sheets (cont.)
onsolidated Balance Sheets (cont Asof in riore) 3815 1291/2004 Variance Liabilities Curent tabiities, excluding debt 473.6 6372 (163.6) ‘Warehouse line of crecit? 438 138.2 4.4) Senior sectred term loan tranche B 2744 2774 (a0) 11% serior subordinated notes 1790 205.0 (26.0) 9% senior notes 130.0 13
Slide 12: Debt and capitalization
Asof Ginrilions) 3/305 __ 12/31/2004 Variance Cash 1578 2569 (99.1) Senior secured termnloan tranche B 274A 2A 8.0) Other debt! 212 225 (13) 6 senior notes 130.0 1300 - 11% senior subordinated notes 179.0 2050 (26.0) Total debt 6043 646 (30.3) Stockholders! equity 579.5 5600 19.5 Total capitalizatio
Slide 13: Normalized Internal Cash Flow
is Normalized Internal Cash Flo: nex = Strong cash flow generator = Low capital intensity = Utilization of internal cash flow * Debt reduction * Co-investment activities * In-ill acquisitions Net income, ar adjusted Intemal Cazh Flow 41. Excludes capital expenditures, net of concessions, of 5.5 mill
Slide 14: 2005 Guidance
Revenue of $2.6 billion = Net income, as adjusted, within the range of $160 to $168 million = Earnings per share, as adjusted, growth of approximately 27% to 33% resulting in a guidance range of $2.10 to $2.20! Eoluding residual one-time Insignia and debt buy-back charges of approximately $16 milion
Slide 15: Q1 2005 Segment Performance
i 2005 Segment Performance comme) Global investment Americas EMEA Asia Pacific Management . ~ 2 = g a : E E 08 Hh Tan Fall SE) SS Tn Normalized EBITDA $251 $463 2.1) $29 ss $24 17 $28 Ti 2005 2005 CBRE 14 CB RICHARD ELLIS
Slide 16: CBRE Recent Wins
CBRE Recent Wins Americas EMEA Dow Chemical Company — Provide facilities management services for an additional 4.1 milion square feet of manufacturing space in the US and Europe Ford — Provide project management services for Ford's Headquarters campus of 7 million square feet and faciities managemen
Slide 17: Favorable Trends
Favorable Trends = Improving commercial real estate fundamentals in most major markets . * * . Declining vacanay rates Increasing net absorption Rising rentalrates Low jevels of new construction = Continued strength of capital flows to commercial real estate and resulting strong commercial real esta
Slide 18: Record Performance and Outlook
= Record Performance ® Strong revenue, EBITDA, net income and earnings per share as @ result of improved performance from all lines of business = Outlook ® Global economic expansion continues » Leasing recovery underway ® Strong capital flows to real estate remain CBRE 7 CE RICHARD ELS
Slide 19: Appendix
Appendix |
Slide 20: Reconciliation of Net Income (Loss) to Net Income, As Adjusted
jation of Net Income. ss) to Net Income (Loss), As Adjusted Three Months Ended March 31, 6 inrlons, xcept share dat) 2005 2004 Net income (loss) 14.6 (16.6) Amortization related to net revenue backlog acquired in the Insignia acquisition, net of tax . 48 Merger-related charges related to the Insigni
Slide 21: Reconciliation of Normalized EBITDA to Net Income (Loss)
ized EBITDA to EBITDA to Net Income (Loss) Three Months Ended March 31, (6 inriions) 2005 2004 Normalized EBITDA 527 25.4 Less Merger-related charges related to the - 100 Insignia acquisition Integration costs related to the Insignia 55 ay acquisition EBITDA 50.2 10.1 Ade Interest income 25 13 Less
Slide 22: Reconciliation of Normalized EBITDA to Net Income (Trailing Twelve Months)
ized EBITDA to EBITDA to Net Income (Loss) Trailing Twelve Months (6 inrriions) Q12005 1 2004 Normalized EBITDA 327.6 191.6 Less Merger-related charges related to the wy Be Insignia acquisition Integration costs related to the Insignia HRB Be acquisition One-time compensation expense related 8 - to
Slide 23: Reconciliation of Net Income to Net Income, As Adjusted
Reconciliation of Net Income to Net Income, As Adjusted 'M 1S Quarter 2005 Results an +80 (a) Amortization expense related to Insignia net revenue backlog (b) Insignia merger-related and integration costs (c) One-time IPO related compensation expense (d) Costs of extinguishment of debt related to th
Slide 24: Reconciliation of Normalized EBITDA to Operating Income
Reconciliation of Normalized EBITDA to EBITDA to Operating Income (| rae coy ae God nearer Mragerer "Hee rt Ed rch “Heese teed Nach, Treats teach, Tse Mite fedMchl, Ginetins) 208 05 ot 05 2008 eed ESTA, cy mr 23 en) ar 0B a 7 lass: Mapsrrettedchages 78 a1 02 reset gr austen haan costs rato 19 ar 08
Slide 25: Searchable text section of graphics
Searchable text section of graphics shown above Fir st Quarter 2005 Financial Results Earnings Conference Call May 5, 2005 [GRAPHIC] [LOGO] For ward Looking Statements [GRAPHIC] This presentation contains statements that are forward looking within the meaning of the Private Securities Litigation Ref
CB Richard Ellis Group — Q1 2005 Earnings Presentation on 6ix