Jones Lang LaSalle Reports Fourth-Quarter and Full-Year 2009 Results
Fourth-quarter net income of $52 million, a 26 percent year-over-year increase
CHICAGO, Feb. 2 /PRNewswire-FirstCall/ -- Jones Lang LaSalle Incorporated (NYSE: JLL), the leading integrated financial and professional services firm specializing in real estate, today reported net income of $52 million on a U.S. GAAP basis, or $1.19 per share, for the fourth quarter ended December 31, 2009, compared with $41 million, or $1.17 per share, for the fourth quarter ended December 31, 2008. Adjusting for Restructuring and certain non-cash co-investment charges in the quarter, fourth-quarter 2009 net income would have been $63 million, or $1.44 per share. Revenue for the fourth quarter of 2009 was $815 million, a 2 percent increase from $797 million in 2008 although down 3 percent in local currency. The firm's adjusted earnings before interest, taxes, depreciation and amortization ("adjusted EBITDA") in the fourth quarter of 2009 were $112 million.
The net loss for the year ended December 31, 2009, was $4 million, or $0.11 per share, compared with net income of $84 million, or $2.44 per share, for the year ended December 31, 2008. Adjusting for Restructuring and co-investment charges, full-year 2009 net income would have been $70 million, or $1.75 per share. Full-year revenue was $2.5 billion in 2009, an 8 percent decrease in U.S. dollars, 5 percent in local currency, compared with 2008. Adjusted EBITDA was $239 million for the year.
2009 Highlights:
- Fourth-quarter net income of $52 million, a 26 percent increase from fourth-quarter 2008
- Solid performance in the Americas driven by corporate outsourcing and successful Staubach integration
- Asia Pacific generated strong full-year results with improved fourth-quarter transaction performance and annuity revenue growth
- Balance sheet strengthened with net debt repayment of $334 million for the year
Results for full-year 2009 included $47 million of Restructuring charges as well as $51 million of non-cash co-investment charges. Restructuring charges are primarily severance related and also include integration costs from the 2008 acquisitions of The Staubach Company and Kemper's. Restructuring charges are excluded from segment operating results although they are included for consolidated reporting. The non-cash charges relate primarily to impairments of the firm's investments in real estate ventures and are included in Equity losses at the consolidated and segment reporting levels. Results for the fourth quarter of 2009 included $11 million of Restructuring charges, taken principally in EMEA for additional staff reductions, and $4 million of non-cash co-investment charges.
"We are very pleased with our strong finish to a difficult year," said Colin Dyer, Chief Executive Officer of Jones Lang LaSalle. "Although markets face a slow and uneven recovery, the actions we've taken to protect our businesses and win market share make us confident about our prospects for 2010."
Business Line Revenue Comparison for the periods ending December 31, 2009 and 2008:
(in millions, "LC" = local currency)
Three Months Twelve Months
Ended % Ended %
------------ Change ---------------- Change
2009 2008 in LC 2009 2008 in LC
------------------- -----------------------
Investor and Occupier Services
------------------------------
Leasing $288.2 $258.8 8% $781.0 $752.7 6%
Capital Markets 80.9 96.2 (23%) 202.7 316.9 (33%)
Property & Facility Management 198.2 157.9 19% 627.8 544.5 18%
Project & Development Services 90.9 99.6 (15%) 311.6 375.9 (15%)
Advisory, Consulting & Other 92.5 91.3 (2%) 297.4 351.6 (11%)
------------- -----------------
Total IOS Revenue $750.7 $703.8 2% $2,220.5 $2,341.6 (2%)
LaSalle Investment Management
-----------------------------
Advisory fees $62.1 $62.2 (5%) $242.2 $277.9 (9%)
Transaction and Incentive fees 2.3 31.1 (93%) 18.0 78.1 (76%)
------------- -----------------
Total Investment Management $64.4 $93.3 (34%) $260.2 $356.0 (23%)
------------- -----------------
Total Firm Revenue $815.1 $797.1 (3%) $2,480.7 $2,697.6 (5%)
============= =================
The firm benefited from aggressive cost actions taken across all its businesses for staff reductions and discretionary expenses. Excluding Restructuring charges, operating expenses for the fourth quarter were $722 million, compared with $705 million for the fourth quarter of 2008, up 2 percent but down 2 percent in local currency.
For the full year, operating expenses, excluding Restructuring charges, were $2.3 billion in 2009, compared with $2.5 billion in 2008, down 8 percent for the year, 5 percent in local currency.
Income tax expense exceeded pre-tax net income for full-year 2009, resulting in a net loss. The effective tax rate of 23 percent for the fourth quarter of 2009 is more representative of an annual effective tax rate the firm would expect over the long term.
Balance Sheet
At the end of 2009, the outstanding balance on the firm's long-term credit facilities was $175 million. The firm reduced its net bank debt position by $334 million during the year driven by proceeds from its common stock offering in June 2009, strong cash generation and reduced acquisition and capital spending. During the fourth quarter, the firm reduced its net bank debt by $164 million compared to September 30, 2009. The firm was well within the covenant requirements under its bank agreements.
Business Segment Performance Highlights
Investor and Occupier Services
- Revenue for the fourth quarter of 2009 in the Americas region was $345
million, an increase of 9 percent over the fourth quarter of 2008.
Full-year 2009 revenue was $1.0 billion, an increase of 11 percent
from the prior year, primarily as a result of the Staubach acquisition
contributing to six months of results in 2008 but 12 months in 2009.
Fourth-quarter Leasing revenue increased 20 percent, to $176 million.
Leasing revenue increased 34 percent in the year, to $500 million, up
from $373 million in 2008. Property and Facility Management revenue
increased 25 percent for the quarter, to $80 million, and 15 percent
for the year, to $227 million. Though Project & Development Services
revenue was down 24 percent in the fourth quarter, to $44 million,
early actions were taken to right-size the business and ensure it
maintained profit performance. Full-year Project & Development
Services revenue was $159 million, down 21 percent from 2008.
Operating expenses were $302 million in the fourth quarter and $945
million for the year, increases of 9 percent in each period compared
with 2008. The fourth-quarter increases were primarily the result of
increased business activity over the prior-year period while the full-
year increases were primarily the result of additional cost structure
from the Staubach acquisition.
The region's fourth-quarter EBITDA was $52 million compared with $56
million in the fourth quarter of 2008. Full-year EBITDA was $134
million compared with $115 million in 2008.
- EMEA's fourth-quarter revenue was $226 million, compared with $243
million for the fourth quarter of 2008, a reduction of 7 percent, 14
percent in local currency. Full-year revenue was $644 million
compared with $871 million in 2008, a decrease of 26 percent, 20
percent in local currency. The decreases were driven by continued
reductions in transaction volumes across the region.
Capital Markets revenue was $39 million in the fourth quarter and $107
million for the full year of 2009, down 38 percent and 41 percent in
local currency, respectively. Leasing revenue was $70 million for the
fourth quarter and $173 million for full-year 2009, down 12 percent
and 25 percent in local currency, respectively. EMEA results varied
across the region, reflecting significant market declines in Russia,
MENA and Germany and stable-to-improving markets in France and the
United Kingdom. Property & Facility Management revenue was $44
million in the fourth quarter, an increase of 8 percent in local
currency, and $136 million for the full year, up 7 percent in local
currency, as the firm continued to drive annuity-like revenue growth.
Operating expenses were $210 million in the fourth quarter, a decrease
of 5 percent, 12 percent in local currency. Operating expenses were
$653 million for the year, a decrease of 23 percent, 15 percent in
local currency. Cost reductions were the result of the aggressive,
targeted cost management actions taken across the region.
The region's fourth-quarter EBITDA was $22 million compared with $28
million in the prior year. Full-year EBITDA was $11 million compared
with $50 million in 2008.
- Revenue for the Asia Pacific region was $178 million in the fourth
quarter of 2009 compared with $144 million in 2008. Full-year revenue
was $539 million, compared with $536 million for the same period in
2008. In local currency, revenue was up 10 percent for the quarter
and 2 percent in the year compared with 2008.
Fourth-quarter Property & Facility Management revenue in the region
increased to $74 million, or 31 percent, 16 percent in local currency.
Property & Facility Management revenue was $266 million for the year,
a 28 percent increase from 2008, 30 percent in local currency.
Capital Markets revenue was $28 million for the fourth quarter, up 6
percent in local currency compared with the same period in 2008, and
$58 million for the year, down 4 percent in local currency. Leasing
revenue was $42 million in the fourth quarter, up 1 percent in local
currency, and $109 million for the year, down 18 percent in local
currency.
The firm leveraged its large China presence to capitalize on the
government's economic stimulus package, which drove 20 percent year-
over-year revenue growth across its business in the country. The
firm's Australia business reported the highest U.S. dollar revenue
improvement in the region resulting from its strong Property &
Facility Management business, favorable foreign currency exchange
rates and generally better economic conditions relative to the rest of
the region.
Fourth-quarter operating expenses were $153 million, compared with
$137 million in 2008, a decrease of 1 percent in local currency.
Operating expenses for the region were $507 million for the year, a
decrease of 5 percent, 3 percent in local currency.
The region's fourth-quarter EBITDA was $29 million compared with $11
million in the prior year. Full-year EBITDA was $44 million compared
with $18 million in 2008.
LaSalle Investment Management
- LaSalle Investment Management's fourth-quarter revenue, including
equity losses, was $64 million compared with $90 million in the fourth
quarter of 2008. There were $1 million of equity losses in the fourth
quarter of 2009 compared with $3 million in the fourth quarter of
2008, primarily from non-cash charges related to co-investments.
Full-year revenue, including equity losses, was $208 million, compared
with $352 million in the prior year. Equity losses were $53 million
in 2009, $4 million in 2008. Advisory fees were $242 million for the
year, down $36 million from 2008 or 13 percent, 9 percent in local
currency. Advisory fees were approximately $60 million in each
quarter of 2009.
The business recognized $1 million of Incentive fees in the fourth
quarter of 2009, $13 million for the full year. Asset purchases, a
key driver of Transaction fees, continued to be limited by the group's
cautious view of the market.
Despite the difficult global real estate environment, LaSalle
Investment Management raised over $4.0 billion of net equity in 2009
for separate accounts, funds and public securities. Assets under
management were $39.9 billion.
Summary
In the midst of a very challenging environment, the firm continued to perform for clients while protecting its businesses, market positions and top talent. Aggressive but targeted cost actions taken throughout the year contributed to strong fourth-quarter performance. The common stock offering and the firm's ability to generate cash resulted in a strong balance sheet at year end. With the pace of recovery differing across global markets, the firm will capture emerging opportunities by leveraging its leading market positions and maintaining its focus on containing costs.
Statements in this press release regarding, among other things, future financial results and performance, achievement, and plans and objectives may be considered forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements involve known and unknown risks, uncertainties and other factors which may cause actual results, performance, achievements, plans and objectives of Jones Lang LaSalle to be materially different from those expressed or implied by such forward-looking statements. Factors that could cause actual results to differ materially include those discussed under "Business," "Management's Discussion and Analysis of Financial Condition and Results of Operations," "Quantitative and Qualitative Disclosures about Market Risk," and elsewhere in Jones Lang LaSalle's Annual Report on Form 10-K for the year ended December 31, 2008, and in the Quarterly Reports on Form 10-Q for the quarters ended March 31, 2009, June 30, 2009, and September 30, 2009, and in other reports filed with the Securities and Exchange Commission. Statements speak only as of the date of this release. Jones Lang LaSalle expressly disclaims any obligation or undertaking to update or revise any forward-looking statements contained herein to reflect any change in Jones Lang LaSalle's expectations or results, or any change in events.
About Jones Lang LaSalle
Jones Lang LaSalle (NYSE: JLL) is a financial and professional services firm specializing in real estate. The firm offers integrated services delivered by expert teams worldwide to clients seeking increased value by owning, occupying or investing in real estate. With 2009 global revenue of $2.5 billion, Jones Lang LaSalle serves clients in 60 countries from 750 locations worldwide, including 180 corporate offices. The firm is an industry leader in property and corporate facility management services, with a portfolio of approximately 1.4 billion square feet worldwide. LaSalle Investment Management, the company's investment management business, is one of the world's largest and most diverse in real estate with nearly $40 billion of assets under management. For further information, please visit our Web site, www.joneslanglasalle.com.
200 East Randolph Drive Chicago Illinois 60601 ¦ 22 Hanover Square London W1A 2BN ¦ 9 Raffles Place #39-00 Republic Plaza Singapore 048619
Conference Call
The firm will conduct a conference call for shareholders, analysts and investment professionals on Wednesday, February 3 at 9:00 a.m. EST.
To participate in the teleconference, please dial into one of the following phone numbers five to 10 minutes before the start time:
- U.S. callers: +1 877 809 9540
- International callers: +1 706 679 7364
- Pass code: 51422270
Webcast
Follow these steps to listen to the webcast:
- You must have a minimum 14.4 Kbps Internet connection
- Log on to http://www.videonewswire.com/event.asp?id=65416 and follow instructions
- Download free Windows Media Player software: (link located under registration form)
- If you experience problems listening, send an e-mail to [email protected]
Supplemental Information
Supplemental information regarding the fourth quarter 2009 earnings call has been posted to the Investor Relations section of the company's Web site: www.joneslanglasalle.com.
Conference Call Replay
Available: 12:00 p.m. EST Wednesday, February 3 through 11:59 p.m. EST Wednesday, February 10 at the following numbers:
- U.S. callers: +1 800 642 1687
- International callers: +1 706 645 9291
- Pass code: 51422270
Web Audio Replay
Audio replay will be available for download or stream within 24 hours of the conference call. This information and link is also available on the company's Web site: www.joneslanglasalle.com.
If you have any questions, call Yvonne Peterson of Jones Lang LaSalle's Investor Relations department at +1 312 228 2919.
JONES LANG LASALLE INCORPORATED
Consolidated Statements of Operations
For the Three and Twelve Months Ended December 31, 2009 and 2008
(in thousands, except share data)
(Unaudited)
Three Months Ended Twelve Months Ended
December 31, December 31,
------------------ -------------------
2009 2008 2009 2008
---- ---- ---- ----
Revenue $815,085 $797,067 $2,480,736 $2,697,586
Operating expenses:
Compensation and benefits 519,834 512,440 1,623,795 1,771,673
Operating, administrative
and other 183,759 165,958 609,779 653,465
Depreciation and amortization 18,728 26,676 83,335 90,584
Restructuring charges 10,815 20,129 47,423 30,401
------ ------ ------ ------
Total operating expenses 733,136 725,203 2,364,332 2,546,123
------- ------- --------- ---------
Operating income 81,949 71,864 116,404 151,463
Interest expense, net of
interest income 11,428 13,336 55,018 30,568
Equity losses from
unconsolidated ventures (2,637) (3,524) (58,867) (5,462)
------ ------ ------- ------
Income before income taxes
and noncontrolling interest 67,884 55,004 2,519 115,433
Provision for income taxes 15,483 13,515 5,677 28,743
------ ------ ----- ------
Net income (loss) 52,401 41,489 (3,158) 86,690
Net income (loss) attributable
to noncontrolling interest 147 (31) 437 1,807
--- --- --- -----
Net income (loss) attributable
to the Company $52,254 $41,520 $(3,595) $84,883
======= ======= ======= =======
Net income (loss) attributable
to common shareholders $52,026 $41,155 $(4,109) $83,515
======= ======= ======= =======
Basic earnings (loss) per
common share $1.24 $1.19 $(0.11) $2.52
===== ===== ====== =====
Basic weighted average
shares outstanding 41,839,401 34,498,974 38,543,087 33,098,228
========== ========== ========== ==========
Diluted earnings (loss)
per common share $1.19 $1.17 $(0.11) $2.44
===== ===== ====== =====
Diluted weighted average
shares outstanding 43,670,994 35,059,856 38,543,087 34,205,120
========== ========== ========== ==========
EBITDA $97,665 $94,682 $139,921 $233,410
======= ======= ======== ========
Please reference attached financial statement notes.
JONES LANG LASALLE INCORPORATED
Segment Operating Results
For the Three and Twelve Months Ended December 31, 2009 and 2008
(in thousands)
(Unaudited)
Three Months Ended Twelve Months Ended
December 31, December 31,
------------------ -------------------
2009 2008 2009 2008
---- ---- ---- ----
INVESTOR & OCCUPIER SERVICES
AMERICAS
Segment revenue:
Revenue $344,662 $315,235 $1,032,784 $933,004
Equity income (losses) 40 260 (1,141) 301
-- --- ------ ---
344,702 315,495 1,031,643 933,305
Operating expenses:
Compensation, operating
and administrative
expenses 292,502 259,595 897,891 818,369
Depreciation and
amortization 9,414 16,445 47,526 47,808
----- ------ ------ ------
301,916 276,040 945,417 866,177
------- ------- ------- -------
Operating income $42,786 $39,455 $86,226 $67,128
======= ======= ======= =======
EBITDA $52,200 $55,900 $133,752 $114,936
------- ------- -------- --------
EMEA
Segment revenue:
Revenue $227,692 $244,059 $646,505 $871,683
Equity losses (1,807) (939) (2,747) (840)
------ ---- ------ ----
225,885 243,120 643,758 870,843
Operating expenses:
Compensation, operating
and administrative
expenses 204,161 214,986 632,387 820,638
Depreciation and
amortization 5,400 6,427 21,041 27,291
----- ----- ------ ------
209,561 221,413 653,428 847,929
------- ------- ------- -------
Operating income (loss) $16,324 $21,707 $(9,670) $22,914
======= ======= ======= =======
EBITDA $21,724 $28,134 $11,371 $50,205
------- ------- ------- -------
ASIA PACIFIC
Segment revenue:
Revenue $178,329 $144,468 $541,233 $536,906
Equity losses - (26) (2,371) (732)
------- ------- ------- -------
178,329 144,442 538,862 536,174
Operating expenses:
Compensation, operating
and administrative
expenses 149,443 133,642 494,574 518,580
Depreciation and
amortization 3,287 3,161 12,485 13,123
----- ----- ------ ------
152,730 136,803 507,059 531,703
------- ------- ------- -------
Operating income $25,599 $7,639 $31,803 $4,471
======= ====== ======= ======
EBITDA $28,886 $10,800 $44,288 $17,594
------- ------- ------- -------
LASALLE INVESTMENT MANAGEMENT
Segment revenue:
Revenue $64,402 $93,305 $260,214 $355,993
Equity losses (870) (2,819) (52,608) (4,191)
---- ------ ------- ------
63,532 90,486 207,606 351,802
Operating expenses:
Compensation, operating and
administrative expenses 57,488 70,176 208,722 267,552
Depreciation and
amortization 626 642 2,283 2,361
--- --- ----- -----
58,114 70,818 211,005 269,913
------ ------- ------- -------
Operating income (loss) $5,418 $19,668 $(3,399) $81,889
====== ======= ======= =======
EBITDA $6,044 $20,310 $(1,116) $84,250
------ ------- ------- -------
Total segment revenue 812,448 793,543 2,421,869 2,692,124
Reclassification of
equity losses (2,637) (3,524) (58,867) (5,462)
------ ------ ------- ------
Total revenue $815,085 $797,067 $2,480,736 $2,697,586
======== ======== ========== ==========
Total operating expenses
before restructuring
charges 722,321 705,074 2,316,909 2,515,722
Operating income before
restructuring charges $92,764 $91,993 $163,827 $181,864
======= ======= ======== ========
Please reference attached financial statement notes.
JONES LANG LASALLE INCORPORATED
Consolidated Balance Sheets
December 31, 2009 and 2008
(in thousands)
(Unaudited)
December 31, December 31,
2009 2008
------------ ------------
ASSETS
------
Current assets:
Cash and cash equivalents $69,263 $45,893
Trade receivables, net of allowances 669,993 718,804
Notes and other receivables 73,984 89,636
Prepaid expenses 35,689 32,990
Deferred tax assets 82,793 102,934
Other 8,196 9,511
----- -----
Total current assets 939,918 999,768
Property and equipment, net of accumulated
depreciation 213,708 224,845
Goodwill, with indefinite useful lives 1,441,951 1,448,663
Identified intangibles, with finite useful
lives, net of accumulated amortization 36,791 59,319
Investments in real estate ventures 167,310 179,875
Long-term receivables 52,941 51,974
Deferred tax assets 139,406 58,639
Other 104,908 53,942
------- ------
Total assets $3,096,933 $3,077,025
========== ==========
LIABILITIES AND EQUITY
-----------------------
Current liabilities:
Accounts payable and accrued liabilities $347,650 $352,489
Accrued compensation 479,628 487,895
Short-term borrowings 23,399 24,570
Deferred tax liabilities 1,164 2,698
Deferred income 38,575 29,213
Deferred business acquisition obligations 106,330 13,073
Other 98,349 77,947
------ ------
Total current liabilities 1,095,095 987,885
Noncurrent liabilities:
Credit facilities 175,000 483,942
Deferred tax liabilities 3,210 4,429
Deferred compensation 27,039 44,888
Pension liabilities 8,210 4,101
Deferred business acquisition obligations 287,259 371,636
Minority shareholder redemption liability 32,475 43,313
Other 86,031 65,026
------ ------
Total liabilities 1,714,319 2,005,220
Company shareholders' equity:
Common stock, $.01 par value per share,
100,000,000 shares authorized;
41,843,947 and 34,561,648 shares issued
and outstanding as of December 31, 2009,
and December 31, 2008, respectively 418 346
Additional paid-in capital 854,227 599,742
Retained earnings 531,456 543,318
Shares held in trust (5,196) (3,504)
Accumulated other comprehensive loss (1,976) (72,220)
------ -------
Total Company shareholders' equity 1,378,929 1,067,682
Noncontrolling interest 3,685 4,123
----- -----
Total equity 1,382,614 1,071,805
---------- ----------
Total liabilities and equity $3,096,933 $3,077,025
========== ==========
Please reference attached financial statement notes.
JONES LANG LASALLE INCORPORATED
Summarized Consolidated Statements of Cash Flows
For the Twelve Months Ended December 31, 2009 and 2008
(in thousands)
(Unaudited)
Twelve Months Ended December 31,
--------------------------------
2009 2008
-------- --------
Cash provided by operating activities $250,554 $33,365
Cash used in investing activities (109,932) (494,864)
Cash (used in) provided by financing
activities (117,252) 428,812
-------- -------
Net increase (decrease) in cash and cash
equivalents 23,370 (32,687)
Cash and cash equivalents, beginning of
period 45,893 78,580
------ ------
Cash and cash equivalents, end of period $69,263 $45,893
======= =======
Please reference attached financial statement notes.
JONES LANG LASALLE INCORPORATED
Financial Statement Notes
1. Charges excluded from GAAP net income (loss) to arrive at adjusted
net income for the quarters and years ended December 31, 2009, and
December 31, 2008, respectively, are integration costs related to the
Staubach and Kemper's acquisitions completed in 2008, severance costs
and non-cash charges related to co-investments.
Below are reconciliations of GAAP net income (loss) to adjusted net
income and calculations of earnings (loss) per share ("EPS"), for each
net income (loss) total (in millions after tax, except per share):
Three Months Ended Twelve Months Ended
December 31, December 31,
------------------ -------------------
2009 2008 2009 2008
---- ---- ---- ----
GAAP net income (loss) $52.0 $41.2 $(4.1) $83.5
Shares (in 000's) 43,671 35,060 38,543 34,205
------ ------ ------ ------
GAAP earnings (loss) per share $1.19 $1.17 $(0.11) $2.44
===== ===== ====== =====
GAAP net income (loss) $52.0 $41.2 $(4.1) $83.5
Restructuring, net of tax 8.1 15.1 35.6 22.8
Non-cash co-investment charges,
net of tax 2.8 3.7 38.5 4.4
--- --- ---- ---
Adjusted net income 62.9 60.0 70.0 110.7
Shares (in 000's) 43,671 35,060 40,106 34,205
------ ------ ------ ------
Adjusted earnings per share $1.44 $1.71 $1.75 $3.24
===== ===== ===== =====
An effective tax rate of 24.9 percent is assumed in calculating
Restructuring, net of tax, and Non-cash co-investment charges, net of
tax, as 24.9 percent was the effective tax rate for the year ended 2008
and is a reasonable estimate of an annual effective tax rate the firm
would expect over the long term.
Basic shares outstanding are used in the calculation of full-year 2009
GAAP EPS as the use of dilutive shares outstanding would cause that EPS
calculation to be anti-dilutive.
2. EBITDA represents earnings before interest expense, net of interest
income, income taxes, depreciation and amortization. Although EBITDA is
a non-GAAP financial measure, it is used extensively by management and
is useful to investors and lenders as one of the primary metrics for
evaluating operating performance and liquidity. The firm believes that
EBITDA is an indicator of ability to service existing debt, to sustain
potential future increases in debt and to satisfy capital requirements.
EBITDA is also used in the calculations of certain covenants related to
the firm's revolving credit facility. However, EBITDA should not be
considered as an alternative either to net income (loss) or net cash
provided by operating activities, both of which are determined in
accordance with GAAP. Because EBITDA is not calculated under GAAP, the
firm's EBITDA may not be comparable to similarly titled measures used
by other companies.
Below is a reconciliation of net income (loss) to EBITDA and adjusted
EBITDA (in thousands):
Three Months Ended Twelve Months Ended
December 31, December 31,
------------------ -------------------
2009 2008 2009 2008
---- ---- ---- ----
Net income (loss) $52,026 $41,155 $(4,109) $83,515
Add:
Interest expense, net of
interest income 11,428 13,336 55,018 30,568
Provision for income taxes 15,483 13,515 5,677 28,743
Depreciation and amortization 18,728 26,676 83,335 90,584
------ ------ ------ ------
EBITDA $97,665 $94,682 $139,921 $233,410
======= ======= ======== ========
Add:
Non-cash co-investment
charges 3,650 4,879 51,225 5,824
Restructuring 10,815 20,129 47,423 30,401
------ ------ ------ ------
Adjusted EBITDA $112,130 $119,690 $238,569 $269,635
======== ======== ======== ========
Below is a reconciliation of net cash from operating activities, the most
comparable cash flow measure on the consolidated statements of cash flows,
to EBITDA and adjusted EBITDA (in thousands):
Three Months Ended Twelve Months Ended
December 31, December 31,
------------------ -------------------
2009 2008 2009 2008
---- ---- ---- ----
Net cash provided by
operating activities $206,693 $146,487 $250,554 $33,365
Add (deduct):
Interest expense, net of
interest income 11,428 13,336 55,018 30,568
Change in working capital
and non-cash expenses (135,939) (78,656) (171,328) 140,734
Provision for income taxes 15,483 13,515 5,677 28,743
------ ------ ----- ------
EBITDA $97,665 $94,682 $139,921 $233,410
======= ======= ======== ========
Add:
Non-cash co-investment
charges 3,650 4,879 51,225 5,824
Restructuring 10,815 20,129 47,423 30,401
------ ------ ------ ------
Adjusted EBITDA $112,130 $119,690 $238,569 $269,635
======== ======== ======== ========
3. For purposes of segment operating results, the allocation of
restructuring charges to the segments has been determined to not be
meaningful to investors, so the performance of segment results has been
evaluated without allocation of these charges.
4. Each geographic region offers the firm's full range of Investor
Services, Capital Markets and Occupier Services. The Investor and
Occupier Services business consists primarily of tenant representation
and agency leasing; capital markets; property management and facilities
management; project and development management; and advisory,
consulting and valuation services. The Investment Management segment
provides investment management services to institutional investors and
high-net-worth individuals.
5. The consolidated statements of cash flows are presented in summarized
form. For complete consolidated statements of cash flows, please refer
to the firm's Annual Report on Form 10-K for the year ended December
31, 2009, to be filed with the Securities and Exchange Commission.
6. EMEA refers to Europe, Middle East, and Africa. MENA refers to Middle
East and North Africa.
7. Certain prior year amounts have been reclassified to conform to the
current presentation.
SOURCE Jones Lang LaSalle Incorporated
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