12.02.09
CB Richard Ellils Group, Inc. reports full year 2008 revenue of $5.1 billion and earnings per share of $0.97.
CB Richard Ellis reported full year 2008 revenue of $5.1 billion and diluted earnings per share of $0.39. For the fourth quarter of 2008, revenue was $1.3 billion and diluted earnings per share was $0.03. These diluted earnings per share amounts do not include the impact of significant, pending, non-cash goodwill and other non-amortizable intangible asset impairments that are discussed later in this press release.
Excluding one-time charges, diluted earnings per share was $0.97 for the full year and $0.37 for the fourth quarter.
"The strength of our people and platform enabled us to gain new clients and build market share across the business in 2008, despite extremely challenging global economic conditions," said Brett White, president and chief executive officer of CB Richard Ellis. "To better position CBRE for long term success, we have strategically diversified our revenue mix in the last few years with significantly increased contributions from fee-based outsourcing services and have moved decisively to eliminate fixed costs and improve operational efficiencies. For 2008, these moves enabled us to remain profitable and achieve the third-highest normalized EBITDA in our history in the face of very tough commercial real estate market conditions. However, the credit crunch and global economic weakness pose serious challenges for our industry in 2009, and as such, we will continue to manage our business carefully to sustain profitability in a market where property sales and leasing activity remains highly constrained."
The growth in fee-based outsourcing services was reflected in 33 new corporate outsourcing contracts secured in 2008 and the expansion of services for 32 existing customers. In addition, our market-leading property and corporate facilities management portfolio expanded by approximately 250 million square feet during the year.
2008 revenue from this business line accounted for more than one-third of global revenue — up from approximately 23% in the prior year.
The Company also improved its market share in a number of markets around the globe. For example, CB Richard Ellis was the number one leasing agent in London during 2008, responsible for approximately 26% of all market activity - increased from approximately 16% in 2007. In the U.S. investment sales market, the Company claimed a 17.9% market share in 2008 compared with 16.1% in 2007, according to Real Capital Analytics. This growth is emblematic of the Company\'s ability to increase its position in an overall weak market.
Management has worked diligently to remove significant operating expense from the Company\'s business model in order to better align costs with lower revenue opportunities in the current market. To date, the Company has taken actions to eliminate a total of approximately $385 million of annual run-rate expenses for 2009 including the previously announced $190 million of expense savings. These amounts are exclusive of variable compensation reductions due to lower transaction revenue.
In addition, the Company moved aggressively to reduce net debt by approximately 14%, or $305.8 million, as of December 31, 2008 compared with September 30,2008. This was accomplished with the net proceeds from an equity offering of $207.8 million and cash flow from operations. Full Year Results:
Revenue was $5.1 billion for the twelve months ended December 31, 2008, compared with $6.0 billion for the same period last year. Net income for the full year totaled $83.9 million, or $0.39 per diluted share, compared with net income of $390.5 million, or $1.66 per diluted share, in the same period last year.
Excluding one-time charges, the Company would have earned net income of $208.7 million, or $0.97 per diluted share, for the twelve months ended December 31, 2008, compared with net income of $496.8 million, or $2.11 per diluted share, for the twelve months ended December 31, 2007.
Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) was $457.0 million for the twelve months ended December 31, 2008, including $144.2 million of one¬time charges, compared with $834.3 million in the same period last year, which included $135.8 million of one-time charges.