FINANCE: CBRE has reported a 22% hike in revenue to $2.1bn (£1.2bn) with EMEA revenue surging by 89% in the second quarter.
The New York-listed firm’s like-for-like group revenue increase was trailed by a 17% hike in net income to $118.7m.
Adjusted earnings per diluted share rose by 16% to $0.36 from $0.31 in the prior-year period.
For the second quarter, selected charges – net of income taxes – totalled $13.2m, versus $31.9m for the same period in 2013.
Excluding selected charges, EBITDA increased 8% to $262.8m, which CBRE said was due to the impact of lower mortgage origination activity with the US’s Government Sponsored Enterprises and the timing of development sales.
The shift in the company’s business mix toward greater contractual revenue was evident in the quarter.
With the addition of Norland, contractual revenue rose to 53% of total revenue – up from 47% in the second quarter of 2013.
Looking at EMEA, significant revenue increases were noted in property sales and occupier outsourcing, coupled with strong contributions from Norland Managed Services.
Excluding the contribution from Norland, overall EMEA revenue rose 16%.
EBITDA rose 133% to $27.4m and operating income totaled $11.9m, up 43% from Q2 last year.
In the Americas, revenue rose by 11% and in Asia Pacific it increased by 3%.
Among global business lines, property leasing revenue improved by 14% – the fourth consecutive quarter of double-digit increases.
CBRE’s occupier outsourcing business, Global Corporate Services, continued to show robust growth. Globally, GCS revenue increased by 58%, reflecting 17% organic growth supplemented by strong contributions from the Norland acquisition.
Michael Strong, EMEA executive chairman, said: “In the last five years we have strategically invested in our business mix and footprint across EMEA to ensure we can deliver world class services and insight to clients.
“The fact that we delivered 24% organic revenue growth and a doubling of EBITDA in the first half of 2014 shows that our commitment to this strategy has placed us in an exceptional position to capitalise on improving market confidence and activity across Continental Europe.
“Overlaying this, the integration of Norland Managed Services and our Global Corporate Services division has led us to securing a number of very significant facilities management mandates as occupier clients place increased value on providers with truly integrated, full-service, multi-regional capabilities.”
Bob Sulentic, president and chief executive of CBRE, said: “Our significant leasing growth was particularly notable, especially in the US, where the markets are improving and we are continuing to drive gains in market share.
“We are equally pleased with the exceptionally strong growth in our occupier outsourcing business, even before the benefit of the Norland acquisition.
“Our overall performance was in line with the anticipated trajectory of our business and reflects our success in driving meaningful growth while continuing to make investments that will enhance client service, support our professionals and sustain our long-term performance.”
bridget.o’connell@estatesgazette.com
