CBRE Group (CBRE) Q4 2012 earnings summary

Executive summary

• Global commercial real estate services and investment platform; 2012 revenue rose 10.3% to $6.51B, with higher sales, mortgage brokerage and outsourcing activity.

• Net income attributable to shareholders increased to $315.6M from $239.2M; diluted EPS was $0.97 versus $0.74.

• Q4 revenue was $2.01B, operating income $232.7M, net income attributable to shareholders $173.0M and diluted EPS $0.53.

Financial highlights

• Operating income rose to $585.1M from $462.9M; operating margin was 9.0% versus 7.8%.

• EBITDA was $861.6M; Adjusted EBITDA, excluding cost-containment, acquisition/integration and impaired-asset charges, was $918.4M.

• Revenue increased 10.3%; sales transaction revenue rose 10.9%, mortgage brokerage activity 31.3% and outsourcing activity 10.1%; leasing revenue was essentially flat.

• Operating cash flow was $291.1M, down from $361.2M, primarily reflecting higher bonuses, commissions and taxes paid and working-capital movements.

Outlook and guidance

• 2013 net capital expenditures were expected to reach up to $160M; operating cash flow and the revolving credit facility were expected to cover anticipated cash needs for at least the next 12 months.

• Market recovery remained gradual; further improvement depended on stronger growth and job creation, healthy credit markets, and improved business and investor confidence.

• Development projects in process were $4.2B at year-end, while the prospective-deal pipeline was $2.1B, up $0.9B YoY.