Jones Lang LaSalle Reports First-Quarter 2013 Adjusted EPS of $0.36 Revenue of $856 million; fee revenue of $781 million

CHICAGO, April 30, 2013 /PRNewswire/ -- Jones Lang LaSalle Incorporated (NYSE: JLL) today reported adjusted earnings per share ("EPS") of $0.36 for the first quarter of 2013.  First-quarter revenue of $856 million was up 6 percent in local currency.  Fee revenue was $781 million, an increase of 6 percent.

  • Revenue growth of 6 percent achieved against strong prior-year quarter
  • Capital Markets & Hotels outperformed markets in the Americas and EMEA
  • Solid EMEA performance driven by 12 percent fee revenue growth and cost discipline
  • Stable underlying business performance for LaSalle Investment Management against strong prior year, which had $20 million of equity earnings and incentive fees
  • 10 percent increase in semi-annual dividend to $0.22 per share reflects confidence in cash generation

Summary Financial Results

   ($ in millions, except per share data)



Three Months Ended March 31,




2013

2012






Revenue



$    856

$   813

Fee Revenue1



$    781

$   745

Adjusted Net Income2



$      16

$     22

U.S. GAAP Net Income



$      13

$     14

Adjusted Earnings per Share2



$   0.36

$  0.50

Earnings per Share



$   0.29

$  0.31

Adjusted EBITDA3



$      48

$     55

     Adjusted EBITDA, Real Estate Services



$     34

$    27

     Adjusted EBITDA, LaSalle Investment Management



$     14

$    28







See Financial Statement Notes (1), (2) and (3) following the Financial Statements in this news release

 

"We're pleased with our opening quarter, which is in line with our expectations," said Colin Dyer, President and Chief Executive Officer of Jones Lang LaSalle.  "The performance of our regional real estate services showed overall improvement driven by fee revenue growth and cost actions taken last year.  LaSalle Investment Management maintained good underlying performance and is positioned to increase assets under management.

Dyer continued, "With markets in a gradual but uneven cyclical upswing, we continue to grow market share, improve productivity and expand client relationships.  We remain positive about our prospects for the year." 


Consolidated Revenue

   ($ in millions, "LC" = local currency)





Three Months Ended March 31,

%
Change
in LC






2013

2012










Real Estate Services ("RES")









Leasing






$    229.2

$  230.2

0%

Capital Markets & Hotels






120.7

88.7

37%

Property & Facility Management






251.1

240.4

6%

Property & Facility Management Fee Revenue1






212.1

201.1

7%

Project & Development Services






113.6

107.5

7%

Project & Development Services Fee Revenue1






77.1

78.4

(1%)

Advisory, Consulting and Other






81.7

79.0

5%

     Total RES Revenue






$    796.3

$   745.8

8%

Total RES Fee Revenue1






$   720.8

$  677.4

7%










LaSalle Investment Management









Advisory Fees






$      56.4

$    57.3

(1%)

Transaction Fees & Other






3.1

1.8

72%

Incentive Fees






0.2

8.4

n/m

     Total LaSalle Investment Management Revenue






$      59.7

$    67.5

(11%)










Total Firm Revenue






$     856.0

$   813.3

6%

Total Firm Fee Revenue1






$    780.5

$   744.9

6%










n/m – not meaningful























Consolidated Q1 Performance Highlights:

  • Consolidated fee revenue growth was driven by a 37 percent increase in Capital Markets & Hotels and a 12 percent fee revenue increase in local currency for the EMEA region.
  • LaSalle Investment Management's advisory fees showed continued stability in advance of growth prospects from new investor mandates.
  • Consolidated operating expenses, excluding restructuring and acquisition charges, were $833 million, up 7 percent, primarily due to increased compensation costs from a larger employee base and improved performance.

Balance Sheet and Dividend

  • The firm's total net debt was $870 million at quarter end, flat with the first quarter last year.
  • Net interest expense for the first quarter was $7.9 million, compared with $7.4 million in 2012; the firm's low leverage, investment-grade balance sheet generated modest interest expense.
  • Reflecting confidence in the firm's cash generation, the Board of Directors announced a semi-annual dividend of $0.22 per share, a 10 percent increase from the $0.20 per share payment made in December 2012.

Business Segment Performance Highlights

Americas Real Estate Services


Americas Revenue

   ($ in millions, "LC" = local currency)





Three Months Ended  March 31,


%
Change
in LC






2013

2012












Leasing






$    152.3

$   149.6


2%

Capital Markets & Hotels






38.7

27.9


39%

Property & Facility Management






108.5

101.4


7%

Property & Facility Management Fee Revenue1






89.4

85.6


5%

Project & Development Services






37.9

39.6


(4%)

Project & Development Services Fee Revenue1






37.7

39.5


(4%)

Advisory, Consulting and Other






24.1

22.9


6%

     Operating Revenue






$  361.5

$   341.4


6%











Equity Earnings






0.2

0.1


n/m

Total Segment Revenue






$  361.7

$   341.5


6%

Total Segment Fee Revenue1






$    342.4

$     325.6


5%











n/m – not meaningful

























Americas Q1 Performance Highlights:

  • Revenue growth was driven by Capital Markets & Hotels, up 39 percent, as market share gains continued.
  • Fee-based operating expenses were $328 million for the year, up a modest 4 percent.
  • Operating income was $15 million, up from $12 million in 2012.  Operating income margin calculated on a fee revenue basis was 4.3 percent, up from 3.7 percent. 
  • EBITDA was $25 million, up from $22 million in 2012.  EBITDA margin calculated on a fee revenue basis was 7.3 percent, up from 6.7 percent.  

EMEA Real Estate Services 


EMEA Revenue

   ($ in millions, "LC" = local currency)





Three Months Ended March 31,


%

Change

in LC






2013

2012












Leasing






$    48.9

$   47.3


4%

Capital Markets & Hotels






58.2

39.2


50%

Property & Facility Management






42.7

42.6


0%

Property & Facility Management      

Fee Revenue1






40.4

41.2


(2%)

Project & Development Services






56.0

50.5


11%

Project & Development Services

Fee Revenue1






24.1

24.2


0%

Advisory, Consulting and Other






39.1

38.4


3%

     Operating Revenue






$ 244.9

$   218.0


13%











Equity Earnings






-

-


n/m

Total Segment Revenue






$ 244.9

$   218.0


13%

Total Segment Fee Revenue1






$   210.7

$     190.3


12%











n/m – not meaningful























EMEA Q1 Performance Highlights:

  • Revenue growth was driven by Capital Markets & Hotels and, geographically, by Russia and the UK.
  • Fee-based operating expenses were $212 million for the quarter, up 6 percent in local currency primarily due to increased variable compensation from improved transactional performance.
  • Adjusted operating income, which excludes King Sturge amortization, was a loss of $1 million, compared with an $8 million loss in 2012. 
  • EBITDA was $3 million, compared with a loss of $4 million in 2012.  EBITDA margin calculated on a fee revenue basis was 1.6 percent compared with a loss of 2.3 percent last year.

Asia Pacific Real Estate Services 


Asia Pacific Revenue

   ($ in millions, "LC" = local currency)





Three Months Ended March 31,


%
Change
in LC






2013

2012












Leasing






$   28.0

$   33.3


(15%)

Capital Markets & Hotels






23.8

21.6


12%

Property & Facility Management






99.9

96.4


8%

Property & Facility Management

Fee Revenue1






82.3

74.3


14%

Project & Development Services






19.7

17.4


17%

Project & Development Services

Fee Revenue1






15.3

14.7


7%

Advisory, Consulting and Other






18.5

17.6


7%

     Operating Revenue






$   189.9

$   186.3


5%











Equity Earnings






0.1

0.1


n/m

Total Segment Revenue






$   190.0

$   186.4


5%

Total Segment Fee Revenue1






$     168.0

$     161.6


6%











n/m – not meaningful


























Asia Pacific Q1 Performance Highlights:


  • Revenue growth was led by annuity growth in Property & Facility Management and transactional growth in Capital Markets & Hotels.  Geographically, growth was driven by Hong Kong, China and Southeast Asia.
  • Fee-based operating expenses were $166 million for the quarter, up 10 percent in local currency, principally due to increased compensation costs from a higher employee base and annual base compensation increases effective in the second quarter of 2012.
  • Operating income was $2 million, compared with $7 million last year.  Operating income margin calculated on a fee revenue basis was 1.5 percent, compared with 4.3 percent last year.
  • EBITDA was $6 million, compared with $10 million last year.  EBITDA margin calculated on a fee revenue basis was 3.3 percent, compared with 6.2 percent last year.

LaSalle Investment Management


LaSalle Investment

Management Revenue





Three Months Ended  March 31,


%
Change
in LC

   ($ in millions, "LC" = local currency)





2013

2012












Advisory Fees






$     56.4

$     57.3


(1%)

Transaction Fees & Other






3.1

1.8


72%

Incentive Fees






0.2

8.4


n/m

     Operating Revenue






$     59.7

$     67.5


(11%)











Equity Earnings






5.2

11.7


(56%)

Total Segment Revenue






$     64.9

$     79.2


(17%)











n/m – not meaningful

























LaSalle Investment Management Q1 Performance Highlights:

  • Advisory fees were $56 million for the quarter, consistent with quarterly averages throughout 2012.
  • Operating expenses were $52 million for the quarter, flat with 2012.
  • EBITDA was $14 million for the quarter, a margin of 21.2 percent, compared with $28 million in 2012, a margin of 34.8 percent. The year-over-year changes in total segment revenue and EBITDA were driven by the movement in equity earnings and incentive fees, a combined $5 million in 2013 compared with $20 million in 2012.
  • Assets under management were $47.7 billion as of March 31, 2013, compared with $47.0 billion at year-end 2012.

About Jones Lang LaSalle
Jones Lang LaSalle (NYSE: JLL) is a professional services and investment management firm offering specialized real estate services to clients seeking increased value by owning, occupying and investing in real estate. With annual revenue of $3.9 billion, Jones Lang LaSalle operates in 70 countries from more than 1,000 locations worldwide. On behalf of its clients, the firm provides management and real estate outsourcing services to a property portfolio of 2.6 billion square feet and completed $63 billion in sales, acquisitions and finance transactions in 2012. Its investment management business, LaSalle Investment Management, has $47.7 billion of real estate assets under management. For further information, visit www.jll.com.

200 East Randolph Drive Chicago Illinois 60601 │ 22 Hanover Square London W1A 2BN │ 9 Raffles Place #39-00 Republic Plaza Singapore 048619

Statements in this press release regarding, among other things, future financial results and performance, achievements, plans and objectives, and dividend payments 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, 2012, and in other reports filed with the Securities and Exchange Commission. There can be no assurance that future dividends will be declared since the actual declaration of future dividends, and the establishment of record and payment dates, remains subject to final determination by the Company's Board of Directors.  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.

Conference Call

The firm will conduct a conference call for shareholders, analysts and investment professionals on Tuesday, April 30 at 6:00 p.m. EDT.

To participate in the conference call, please dial into one of the following phone numbers five to ten minutes before the start time:

  • U.S. callers:                      +1 877 356 3887
  • International callers:           +1 706 679 7364
  • Pass code:                        35662726

Webcast

Follow these steps to listen to the webcast:

1. You must have a minimum 14.4 Kbps Internet connection

2. Log on to http://www.videonewswire.com/event.asp?id=93442 and follow instructions

3. Download free Windows Media Player software: (link located under registration form)

4. If you experience problems listening, send an email to prnwebcast@multivu.com 

Supplemental Information

Supplemental information regarding the first-quarter 2013 earnings call has been posted to the Investor Relations section of the company's website:  www.jll.com.

Conference Call Replay

Available: 9:00 p.m. EDT Tuesday, April 30 through 11:59 p.m. EDT Wednesday, May 8 at the following numbers:

  • U.S. callers:                      + 1 855 859 2056
  • International callers:           + 1 404 537 3406
  • Pass code:                        35662726

Web Audio Replay

Audio replay will be available for download or stream. This information and link is also available on the company's website:  www.jll.com.

If you have any questions, email Jones Lang LaSalle's Investor Relations department at JLLInvestorRelations@am.jll.com.

JONES LANG LASALLE INCORPORATED

Consolidated Statements of Operations

For the Three Months Ended March 31, 2013 and 2012

(in thousands, except share data)

(Unaudited)






































Three Months Ended March 31,











2013



2012
















Revenue







$                  855,988



$                  813,294
















Operating expenses:











Compensation and benefits 




563,720



537,516



Operating, administrative and other




249,921



232,596



Depreciation and amortization 




19,079



19,659



Restructuring and acquisition charges




3,168



8,952



















Total operating expenses




835,888



798,723



















Operating income




20,100



14,571
















Interest expense, net of interest income




(7,923)



(7,426)


Equity earnings from unconsolidated ventures 




5,482



11,848
















Income before income taxes and noncontrolling interest




17,659



18,993


Provision for income taxes  





4,397



4,824


Net income






13,262



14,169
















Net income attributable to noncontrolling interest




106



145


Net income attributable to the Company




$                   13,156



$                   14,024
















Net income attributable to common shareholders




$                   13,156



$                   14,024






























Basic earnings per common share




$                       0.30



$                       0.32
















Basic weighted average shares outstanding




44,080,767



43,605,273






























Diluted earnings per common share




$                       0.29



$                       0.31
















Diluted weighted average shares outstanding




45,055,399



44,685,138






























EBITDA 







$                   44,555



$                   45,933












































Please reference attached financial statement notes.