Jones Lang Lasalle Incorporated · NYSE:JLL
Jones Lang Lasalle — Q1 2020 Earnings Presentation
25 slides from Jones Lang Lasalle's earnings presentation, May 5, 2020
Slide 1: Earnings Presentation First Quarter 2020
Earnings Presentation First Quarter 2020 05/05/2020
Slide 2: Cautionary Note Regarding Forward-looking Statements
Cautionary Note Regarding Forward-looking Statements Statements in this news release regarding, among other things, future financial results and performance, achievements, plans, objectives and dividend payments may be considered forward-looking statements within the meaning of the Private Securitie
Slide 3: JLL's Response to the COVID-19 Pandemic
JLL’s Response to the COVID-19 Pandemic Our People Our Clients Our Company Our Communities Maintaining the health and Adapting our services to Prudently managing our Helping manage the wellbeing of our employees, the needs of our clients in costs, in tandem with our spread of the virus and their fam
Slide 4: Consolidated First Quarter 2020 Financial Results
Consolidated First Quarter 2020 Financial Results Revenue Fee Revenue Adjusted EBITDA $4.1B $1.5B $96M +7% in USD +14% in USD ➔ Flat in USD +9% in LC +15% in LC +2% in LC Adjusted EBITDA Margin Adjusted Diluted EPS 6.4% in USD / LC $0.49 (80 bps) in USD (45%) in USD (80 bps) in LC
Slide 5: Strategic Review and Key Highlights
Q1 2020 Strategic Review and Key Highlights Strong revenue growth Continued successful Leadership in Recognition for JLL’s drove record Q1 integration of HFF sustainability operational excellence and culture • Generated organic fee • Growth for the quarter • Recognized as 1 of 5 revenue growth of 5%
Slide 6: Macroeconomic and Real Estate Operating Environment
Q1 2020 Macroeconomic and Real Estate Operating Environment Global Macroeconomy • Against the backdrop of the global spread of COVID- 19, investment in global commercial real estate • Global economic growth likely came to an dropped by 5% in the first quarter abrupt halt in the first quarter marking
Slide 7: JLL is Positioned to Navigate Through these Turbulent Times
JLL is Positioned to Navigate Through these Turbulent Times • A global platform with a talented workforce • Dedication to providing world-class results for our clients and communities JLL Capabilities • A proven ability to manage effectively in an environment filled with uncertainty • Sufficient liq
Slide 8: Financial Overview
@JLL Financial Overview
Slide 9: Financial Results – Segment Revenue
Q1 2020 Financial Results – Segment Revenue ($ in millions; % change over Q1 2019) Q1 2020 Q1 2020 Revenue Fee Revenue Americas $2,523 $918 EMEA 13% 30% $756 $311 7% 1% $712 $178 APAC (2%) (7%) LaSalle $105 $99 8% 6% Notes: • Refer to pages 21 - 24 for definitions and reconciliations
Slide 10: Financial Results – Segment Profitability
Q1 2020 Financial Results – Segment Profitability ($ in millions; % change over Q1 2019) Q1 2020 Q1 2020 Adj. EBITDA Adj. EBITDA Margin Americas $121 13.2% EMEA 38% 80 bps ($11) (2.9%) 49% 290 bps $9 5.2% APAC 29% 150 bps LaSalle ($24) (24.3%) n.m. n.m. Notes: • Refer to pages 21 - 24 fo
Slide 11: Adjusted EBITDA Margin Performance
Q1 2020 Adjusted EBITDA Margin Performance Non-cash Charges: LaSalle: RES Organic: RES M&A: Investments: COVID-19 charges related to Annuity business momentum Strong performance in Q3 2019 acquisition of HFF Reflects continued spend on co-investment values and continues to provide margin Americas pa
Slide 12: Non-cash Charges Related to COVID-19 Pandemic
Non-cash Charges Related to COVID-19 Pandemic Loan Loss Credit Reserves Illustrative impact of COVID-19 non-cash charges Increase in credit reserves for possible Adj. EBITDA future losses on sold multifamily loans in ($M) margin impact Americas, attributable to the pandemic Loan Loss Credit Reserves
Slide 13: Real Estate Services Fee Revenue by Service Line
Q1 2020 Real Estate Services Fee Revenue by Service Line ($ in millions; % change over Q1 2019) Americas EMEA APAC Total RES % Change % Change % Change % Change ($M) USD LC ($M) USD LC ($M) USD LC ($M) USD LC Leasing $406 7% 8% $47 (7%) (4%) $23 (32%) (30%) $475 3% 4% Capital Markets $247 n.m. n.m.
Slide 14: Fee Revenue Growth Drivers
Q1 2020 Fee Revenue Growth Drivers (% change over Q1 2019) Organic Growth M&A Contribution YoY Growth USD Currency Impact LC LC Americas 29% 9% 20% 0% EMEA (2%) 3% (2%) (3%) APAC (10%) (7%) 0% (3%) Total RES 15% 5% 11% (1%) LaSalle 5% 6% 0% (1%) Consolidated 14% 5% 11% (1%) Notes: • Refer to pages 2
Slide 15: LaSalle – First Quarter 2020 Performance
LaSalle – First Quarter 2020 Performance $99M ($24M) Fee Revenue Adj. EBITDA 1st Quarter Overview 5% (USD) / 6% (LC) n.m. / n.m. Fee Revenue Increased by 6% (in LC) 99 • Advisory fees growth drives strong 18 annuity earnings foundation Adjusted EBITDA margin impacted 94 by equity losses of $40M • As
Slide 16: HFF Acquisition Update
HFF Acquisition Update • Ongoing successful integration of the HFF organization • The combined Capital Markets platform HFF Standalone Fee Revenue - $M performed well despite the softening conditions in March 159 Strong HFF revenue and margin performance since 147 acquisition; Q1 2020 performance fo
Slide 17: Balance Sheet and Capital Allocation
Balance Sheet and Capital Allocation Highlights: Investment Grade Ratings • Strong balance sheet with sufficient liquidity provides operational Moody’s: Baa1 flexibility S&P: BBB+ • Leverage increase reflects seasonal liquidity needs, specifically annual incentive compensation payments $275M, 4.4% c
Slide 18: Appendix and Supplemental Material
Appendix and Supplemental Material
Slide 19: JLL Research Market Performance Summary
Q1 2020 JLL Research Market Performance Summary Americas EMEA APAC Global Gross Leasing Volumes (square footage) Q1 2020 (22%) (29%) 15% (22%) (vs Q1 2019) Direct Commercial Real Estate Investment Sales Volumes ($) Q1 2020 (2%) 5% (26%) (5%) (vs Q1 2019) Notes: • Source: JLL Research, April 2020 19
Slide 20: Real Estate Services Revenue by Service Line
Q1 2020 Real Estate Services Revenue by Service Line ($ in millions; % change over Q1 2019) Americas EMEA APAC Total RES % Change % Change % Change % Change ($M) USD LC ($M) USD LC ($M) USD LC ($M) USD LC Leasing $419 7% 8% $48 (8%) (5%) $25 (29%) (27%) $492 3% 4% Capital Markets $247 n.m. n.m. $73
Slide 21: Fee Revenue / Fee-based Operating Expenses Reconciliation
Fee Revenue / Fee-based Operating Expenses Reconciliation Three Months Ended March 31, ($ in millions) 2020 2019 Revenue $4,096.0 $3,820.6 Reimbursements (1,863.0) (1,859.0) Revenue before reimbursements 2,233.0 1,961.6 Gross contract costs (729.4) (642.6) Net non-cash MSR and mortgage banking deriv
Slide 22: Reconciliation of GAAP Net Income to Adjusted Net Income and Diluted EPS
Reconciliation of GAAP Net Income to Adjusted Net Income and Diluted Earnings Per Share Three Months Ended March 31, ($ in millions except per share data) 2020 2019 GAAP net income attributable to common shareholders $5.3 $21.3 Shares (in 000s) 52,458 46,019 GAAP diluted earnings per share $0.10 $0.
Slide 23: Reconciliation of GAAP Net Income to Adjusted EBITDA
Reconciliation Of GAAP Net Income Attributable To Common Shareholders To Adjusted EBITDA Three Months Ended March 31, ($ in millions) 2020 2019 GAAP net income attributable to common shareholders $5.3 $21.3 Interest expense, net of interest income 14.6 9.6 Provision / (benefit) for income taxes 5.0
Slide 24: Non-GAAP Measures
Non-GAAP Measures Management uses certain non-GAAP financial measures to develop budgets and forecasts, measure and reward performance against those budgets and forecasts, and enhance comparability to prior periods. These measures are believed to be useful to investors and other external stakeholder
Slide 25: SLL
SLL