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8-K - FORM 8-K - JONES LANG LASALLE INCd8k.htm
EX-99.2 - SUPPLEMENTAL INFORMATION TO SECOND QUARTER 2011 EARNINGS CALL - JONES LANG LASALLE INCdex992.htm

EXHIBIT 99.1

 

LOGO    LOGO

Real Value in a changing world

 

Contact:    Lauralee Martin
Title:    Chief Operating and Financial Officer
Phone:    +1 312 228 2073

Jones Lang LaSalle Reports Strong Revenue Growth and Earnings Results for Second Quarter 2011

Revenue rises 24 percent to $845 million; adjusted EPS of $1.12 compared with $0.83 in Q2 2010

CHICAGO, July 26, 2011 – Jones Lang LaSalle Incorporated (NYSE: JLL) today reported net income of $44 million on a U.S. GAAP basis, or $0.99 per share, for the quarter ended June 30, 2011, compared with net income of $32 million on a U.S. GAAP basis, or $0.72 per share, for the quarter ended June 30, 2010. Adjusting for Restructuring and acquisition charges and certain other impacts of purchase accounting, net income would have been $50 million or $1.12 per share for the second quarter of 2011, compared with adjusted net income of $37 million or $0.83 per share in 2010. The firm’s adjusted earnings before interest, taxes, depreciation and amortization (“adjusted EBITDA”) were $94 million for the second quarter of 2011 compared with adjusted EBITDA of $78 million for the same period in 2010. Revenue for the second quarter of 2011 was $845 million, an increase of 24 percent in U.S. dollars, 17 percent in local currency, compared with the second quarter of 2010.

On a year-to-date basis net income was $45 million, or $1.02 per share, compared with net income of $32 million, or $0.73 per share, for the first six months of 2010. Adjusting for Restructuring and acquisition charges and certain other impacts of purchase accounting, net income would have been $51 million or $1.15 per share for the first half of 2011, compared with adjusted net income of $43 million for the same period of 2010. Adjusted EBITDA on a year-to-date basis was $122 million compared with adjusted EBITDA of $115 million in 2010. Revenue for the first six months of 2011 was $1.5 billion, compared with $1.3 billion in 2010, an increase of 22 percent, 17 percent in local currency.

 

 

Second-Quarter 2011 Highlights:

 

   

Solid transactional revenue growth continues

 

   

Outstanding performance in Asia Pacific, led by Greater China, India and Australia

 

   

Successful completion of King Sturge acquisition increases strength and depth in EMEA

 

 

Second-quarter results included $6 million of Restructuring and acquisition charges and $2 million of intangible amortization related to the King Sturge acquisition completed in EMEA. Restructuring and


Jones Lang LaSalle Reports Second-Quarter 2011 Results – Page 2

 

acquisition charges are excluded from segment operating results although they are included for consolidated reporting. Intangible amortization is included in Depreciation and amortization in the firm’s consolidated results as well as in EMEA’s segment results.

“We are pleased to report another quarter of solid revenue growth,” said Colin Dyer, President and Chief Executive Officer of Jones Lang LaSalle. “While the cyclical recovery in global real estate markets continues, business confidence is being tested internationally by concerns over government finances. We expect to continue to grow our market share worldwide and remain positive on our prospects for the seasonally stronger second half,” Dyer added.

Consolidated Business Line Revenue Comparison (in millions, “LC” = local currency)

 

     Three Months
Ended June 30,
     %
Change
    Six Months
Ended June 30,
    

%

Change

 
     2011      2010      in LC     2011      2010      in LC  

Real Estate Services (“RES”)

                

Leasing

   $ 281.4       $ 234.4         16   $ 491.2       $ 404.7         19

Capital Markets & Hotels

     103.6         63.6         49     169.7         115.9         37

Property & Facility Management

     197.4         168.4         10     383.8         328.7         11

Project & Development Services

     107.2         80.8         24     200.9         149.1         29

Advisory, Consulting and Other

     89.4         73.7         15     154.5         137.8         8
  

 

 

    

 

 

      

 

 

    

 

 

    

Total RES revenue

     779.0         620.9         19     1,400.1         1,136.2         18

LaSalle Investment Management

                

Advisory fees

   $ 64.7       $ 56.0         8   $ 126.0       $ 114.4         5

Transaction and Incentive fees

     1.6         3.4         (59 %)      7.1         10.4         (38 %) 
  

 

 

    

 

 

      

 

 

    

 

 

    

Total LaSalle Investment
Management

   $ 66.3       $ 59.4         4   $ 133.1       $ 124.8         1
  

 

 

    

 

 

      

 

 

    

 

 

    

Total Firm Revenue

   $ 845.3       $ 680.3         17   $ 1,533.2       $ 1,261.0         17
  

 

 

    

 

 

      

 

 

    

 

 

    

Operating expenses excluding Restructuring and acquisition charges were $774 million for the second quarter, an increase of 19 percent in local currency, compared with operating expenses of $619 million for the same period in 2010. Similar to the first quarter of 2011, the year-over-year increase was principally driven by variable costs to support revenue growth and build the firm’s pipeline for the second half of the year. The firm maintained its 64.4 percent total compensation to revenue ratio in the second quarter.

Year-to-date operating expenses excluding Restructuring and acquisition charges were $1.4 billion, an increase of 18 percent in local currency compared with the first half of 2010.


Jones Lang LaSalle Reports Second-Quarter 2011 Results – Page 3

 

Balance Sheet

The firm’s net debt position, which includes deferred acquisition obligations, increased by $184 million compared with June 30, 2010, to $832 million, primarily due to funding the King Sturge acquisition in EMEA during the second quarter of 2011. Outstanding debt on the firm’s long-term credit facility was $444 million at quarter end.

During the second quarter, the firm announced that it had amended its $1.1 billion long-term credit facility. Among other items, the amendment reset pricing with initial pricing of LIBOR + 1.625 percent, extended the maturity to June 2016 and provided for add-backs to EBITDA for acquisition-related expenses. The firm anticipates making the second deferred payment related to the Staubach acquisition of $150 million in the third quarter of 2011.

Business Segment Second-Quarter and Year-to-Date Performance Highlights

Americas Real Estate Services

Second-quarter revenue in the Americas region was $348 million, an increase of $53 million, or 17 percent in local currency, over the prior year, led by Leasing and by Capital Markets & Hotels, which more than doubled to $32 million. Year-to-date revenue in the region was $636 million in 2011 compared with $524 million in 2010, an increase of 21 percent.

 

      Three Months
Ended June 30,
     %
Change
    Six Months
Ended June 30,
     %
Change
 
Americas (in millions)    2011      2010      in LC     2011      2010      in LC  

Leasing

   $ 171.7       $ 151.4         13%      $ 314.8       $ 257.6         22%   

Capital Markets & Hotels

     31.7         14.3         121%        51.5         23.8         116%   

Property & Facility Management

     74.2         62.4         18%        141.0         120.4         16%   

Project & Development Services

     40.8         38.5         5%        78.0         70.1         11%   

Advisory, Consulting and Other

     28.0         28.9         (3%     48.6         51.8         (6%
                                        

Operating revenue

   $ 346.4       $ 295.5         17%      $ 633.9       $ 523.7         21%   

Equity earnings

     2.0         —           n/m        2.6         0.2         n/m   
                                        

Total segment revenue

   $ 348.4       $ 295.5         17%      $ 636.5       $ 523.9         21%   
                                        

n/m – not meaningful

Operating expenses were $316 million in the second quarter, 20 percent higher than a year ago, 19 percent in local currency. Year-to-date operating expenses were $595 million, compared with $482 million for the same period in 2010, an increase of 23 percent in U.S. dollars and local currency. Included in operating expenses were costs related to new business generation, such as travel and marketing, which will contribute to seasonal revenue growth in the second half of the year, as well as higher costs for service level requirements of several recent business wins. Operating income margin in the region decreased by 1.7 percent year over year in the second quarter of 2011.

 

– more –


Jones Lang LaSalle Reports Second-Quarter 2011 Results – Page 4

 

EBITDA for the second quarter was $42 million, compared with $41 million for the same period last year. Year-to-date EBITDA for 2011 was $61 million, compared with $59 million for the first six months of 2010.

EMEA Real Estate Services

EMEA’s revenue in the second quarter of 2011 was $218 million compared with $171 million in 2010, an increase of 28 percent, 15 percent in local currency. The most significant component of the revenue increase was in Project & Development Services (“PDS”), which includes the region’s fit-out business where gross contracts include subcontractor costs. PDS revenue increased 49 percent in local currency compared with the second quarter of 2010. Year-to-date revenue in the region was $386 million in 2011, compared with $322 million in 2010, an increase of 20 percent, 13 percent in local currency.

 

     Three Months
Ended June 30,
     %
Change
    Six Months
Ended June 30,
     %
Change
 
EMEA (in millions)    2011     2010      in LC     2011     2010      in LC  

Leasing

   $ 60.5      $ 46.8         18%      $ 97.6      $ 85.5         8%   

Capital Markets & Hotels

     38.1        32.0         5%        66.7        58.2         5%   

Property & Facility Management

     34.4        35.1         (12%     70.3        69.6         (5%

Project & Development Services

     46.2        27.6         49%        84.6        53.6         48%   

Advisory, Consulting and Other

     39.0        29.2         24%        67.2        55.3         16%   
                                      

Operating revenue

   $ 218.2      $ 170.7         16%      $ 386.4      $ 322.2         13%   

Equity loss

     (0.2     —           n/m        (0.3     —           n/m   
                                      

Total segment revenue

   $ 218.0      $ 170.7         15%      $ 386.1      $ 322.2         13%   
                                      

n/m – not meaningful

Operating expenses, including $2 million of King Sturge intangibles amortization, were $212 million in the second quarter, an increase of 28 percent from the prior year, 19 percent in local currency. Subcontractor costs related to the PDS business line increased by more than $10 million compared with the prior year. Year-to-date operating expenses were $393 million, an increase of 21 percent, 15 percent in local currency.

On May 31, 2011, the firm completed the merger with international property consultancy King Sturge. The merger greatly enhances the firm’s strength and depth of service capabilities for clients across the EMEA region.

EBITDA for the second quarter was $12 million, compared with $10 million for the same period last year. Year-to-date EBITDA for 2011 was $4 million, compared with $5 million for the first six months of 2010.

 

– more –


Jones Lang LaSalle Reports Second-Quarter 2011 Results – Page 5

 

Asia Pacific Real Estate Services

Revenue in Asia Pacific was $215 million for the second quarter of 2011, compared with $155 million for the same period in 2010, an increase of 39 percent, 26 percent in local currency. The year-over-year increase was largely driven by growth in Greater China, India and Australia. Year-to-date revenue in the region was $380 million in 2011, an increase of 31 percent compared with the same period in 2010, 21 percent in local currency.

 

      Three Months
Ended June 30,
     %
Change

in LC
     Six Months
Ended June 30,
     %
Change

in LC
 
Asia Pacific (in millions)    2011      2010         2011      2010     

Leasing

   $ 49.2       $ 36.2         25%       $ 78.8       $ 61.6         19%   

Capital Markets & Hotels

     33.8         17.3         71%         51.5         33.9         37%   

Property & Facility Management

     88.8         70.9         14%         172.5         138.7         15%   

Project & Development Services

     20.2         14.7         27%         38.3         25.4         42%   

Advisory, Consulting and Other

     22.4         15.6         32%         38.7         30.7         17%   
                                         

Operating revenue

   $ 214.4       $ 154.7         26%       $ 379.8       $ 290.3         21%   

Equity earnings

     0.1         —           n/m         0.1         —           n/m   
                                         

Total segment revenue

   $ 214.5       $ 154.7         26%       $ 379.9       $ 290.3         21%   
                                         

n/m – not meaningful

Operating expenses for the region were $193 million for the quarter, an increase of 34 percent, 22 percent in local currency on a year-over-year basis. The increase was principally due to staff and vendor costs that related to a higher volume of PDS work as well as other corporate client activities. Operating expenses were $353 million for the first half of 2011, compared with $274 million in 2010, an increase of 29 percent, 19 percent in local currency.

The region’s EBITDA for the second quarter of 2011 was $25 million, compared with $14 million for the second quarter of 2010. Year-to-date EBITDA for 2011 was $33 million compared with $23 million for the first six months of 2010.

LaSalle Investment Management

LaSalle Investment Management’s second-quarter Advisory fees were $65 million, 16 percent higher than a year ago, 8 percent in local currency, driven primarily by a higher level of assets under management in the public securities business. Year-to-date Advisory fees were $126 million, compared with $114 million through the first six months of 2010, an increase of 10 percent, 5 percent in local currency. The business recognized $1 million of Transaction fees from asset purchases and $2 million of equity earnings during the quarter.


Jones Lang LaSalle Reports Second-Quarter 2011 Results – Page 6

 

 

LaSalle Investment Management    Three Months
Ended June 30,
    %
Change

in LC
    Six Months
Ended June 30,
    %
Change

in LC
 
(in millions)    2011      2010       2011     2010    

Advisory fees

   $ 64.7       $ 56.0        8%      $ 126.0      $ 114.4        5%   

Transaction and Incentive fees

     1.6         3.4        (59%     7.1        10.4        (38%
  

 

 

    

 

 

     

 

 

   

 

 

   

Operating revenue

   $ 66.3       $ 59.4        4%      $ 133.1      $ 124.8        1%   

Equity earnings (losses)

     2.3         (2.8     n/m        (0.3     (9.1     n/m   
  

 

 

    

 

 

     

 

 

   

 

 

   

Total segment revenue

   $ 68.6       $ 56.6        13%      $ 132.8      $ 115.7        9%   
  

 

 

    

 

 

     

 

 

   

 

 

   

n/m – not meaningful

During the quarter, LaSalle Investment Management raised $2.3 billion of net equity, primarily in the public securities business. Assets under management were $45.3 billion, up from $43.0 billion in the first quarter of 2011. EBITDA was $16 million, compared with $10 million in the second quarter of 2010. Year-to-date EBITDA was $26 million for 2011, compared with $19 million for the first six months of 2010.

Summary

The firm generated solid revenue and profit growth in the second quarter. The successful completion of the King Sturge acquisition during the quarter demonstrates the firm’s focus on enhancing its service capabilities in key markets. Despite caution in a number of geographies due to slower economic growth and concern over government finances, the cyclical recovery in real estate continues and the firm expects to grow market positions and expand share during the remainder of 2011.

 

– more –


Jones Lang LaSalle Reports Second-Quarter 2011 Results – Page 7

 

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 2010 global revenue of more than $2.9 billion, Jones Lang LaSalle serves clients in 70 countries from 1,000 locations worldwide, including more than 200 corporate offices. The firm is an industry leader in property and corporate facility management services, with a portfolio of approximately 1.8 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 $45.3 billion of assets under management. For further information, please visit the company’s website, 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

Statements in this press release regarding, among other things, future financial results and performance, achievements, 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, 2010, and in the Quarterly Report on Form 10-Q for the quarter ended March 31, 2011, 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.

 

– more –


Jones Lang LaSalle Reports Second-Quarter 2011 Results – Page 8

 

Conference Call

The firm will conduct a conference call for shareholders, analysts and investment professionals on Wednesday, July 27 at 9:00 a.m. EDT.

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:

   +1 877 800 0896      

•    International callers:

   +1 706 679 7364      

•    Pass code:

   83343411      

 

 

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=80962 and follow instructions

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

4. If you experience problems listening, send an e-mail to prnwebcast@multivu.com

Supplemental Information

Supplemental information regarding the second-quarter 2011 earnings call has been posted to the Investor Relations section of the company’s website: www.joneslanglasalle.com.

Conference Call Replay

Available: 12:00 p.m. EDT Wednesday, July 27 through 11:59 p.m. EDT August 3 at the following numbers:

 

•    U.S. callers:

   +1 855 859 2056      

•    International callers:

   +1 404 537 3406      

•    Pass code:

   83343411      

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.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 Six Months Ended June 30, 2011 and 2010

(in thousands, except share data)

(Unaudited)

 

     Three Months Ended June 30,     Six Months Ended June 30,  
     2011      2010     2011      2010  

Revenue

   $ 845,295       $ 680,319      $ 1,533,157       $ 1,260,981   

Operating expenses:

          

Compensation and benefits

     544,222         438,408        1,005,578         825,789   

Operating, administrative and other

     210,044         163,042        406,169         319,495   

Depreciation and amortization

     19,350         17,532        37,665         35,246   

Restructuring and acquisition charges

     6,112         3,996        6,112         5,116   
                                  

Total operating expenses

     779,728         622,978        1,455,524         1,185,646   
                                  

Operating income

     65,567         57,341        77,633         75,335   

Interest expense, net of interest income

     9,589         12,918        17,552         24,248   

Equity earnings (losses) from unconsolidated ventures

     4,138         (2,796     2,168         (8,924
                                  

Income before income taxes and noncontrolling interest

     60,116         41,627        62,249         42,163   

Provision for income taxes

     15,029         9,574        15,562         9,698   
                                  

Net income

     45,087         32,053        46,687         32,465   

Net income attributable to noncontrolling interest

     991         78        1,101         246   
                                  

Net income attributable to the Company

   $ 44,096       $ 31,975      $ 45,586       $ 32,219   
                                  

Net income attributable to common shareholders

   $ 43,860       $ 31,757      $ 45,350       $ 32,001   
                                  

Basic earnings per common share

   $ 1.02       $ 0.76      $ 1.06       $ 0.76   
                                  

Basic weighted average shares outstanding

     42,933,918         42,037,112        42,890,599         41,975,448   
                                  

Diluted earnings per common share

   $ 0.99       $ 0.72      $ 1.02       $ 0.73   
                                  

Diluted weighted average shares outstanding

     44,473,320         44,249,698        44,390,612         44,085,326   
                                  

EBITDA

   $ 87,828       $ 71,781      $ 116,129       $ 101,193   
                                  

Please reference attached financial statement notes.


JONES LANG LASALLE INCORPORATED

Segment Operating Results

For the Three and Six Months Ended June 30, 2011 and 2010

(in thousands)

(Unaudited)

 

     Three Months Ended June 30,     Six Months Ended June 30,  
             2011                     2010             2011     2010  

REAL ESTATE SERVICES

        

AMERICAS

        

Revenue:

        

Operating revenue

   $ 346,407      $ 295,485      $ 633,854      $ 523,683   

Equity earnings

     1,980        36        2,632        241   
  

 

 

   

 

 

   

 

 

   

 

 

 
     348,387        295,521        636,486        523,924   

Operating expenses:

        

Compensation, operating and administrative expenses

     306,353        254,217        575,908        464,666   

Depreciation and amortization

     9,558        8,861        19,466        17,718   
  

 

 

   

 

 

   

 

 

   

 

 

 
     315,911        263,078        595,374        482,384   
  

 

 

   

 

 

   

 

 

   

 

 

 

Operating income

   $ 32,476      $ 32,443      $ 41,112      $ 41,540   
  

 

 

   

 

 

   

 

 

   

 

 

 

EBITDA

   $ 42,034      $ 41,304      $ 60,578      $ 59,258   
  

 

 

   

 

 

   

 

 

   

 

 

 

EMEA

        

Revenue:

        

Operating revenue

   $ 218,178      $ 170,762      $ 386,421      $ 322,167   

Equity losses

     (197     (15     (309     (33
  

 

 

   

 

 

   

 

 

   

 

 

 
     217,981        170,747        386,112        322,134   

Operating expenses:

        

Compensation, operating and administrative expenses

     205,970        160,554        382,279        316,814   

Depreciation and amortization

     5,593        4,308        10,503        9,027   
  

 

 

   

 

 

   

 

 

   

 

 

 
     211,563        164,862        392,782        325,841   
  

 

 

   

 

 

   

 

 

   

 

 

 

Operating income (loss)

   $ 6,418      $ 5,885      $ (6,670   $ (3,707
  

 

 

   

 

 

   

 

 

   

 

 

 

EBITDA

   $ 12,011      $ 10,193      $ 3,833      $ 5,320   
  

 

 

   

 

 

   

 

 

   

 

 

 

ASIA PACIFIC

        

Revenue:

        

Operating revenue

   $ 214,378      $ 154,704      $ 379,827      $ 290,349   

Equity earnings

     94        —          94        —     
  

 

 

   

 

 

   

 

 

   

 

 

 
     214,472        154,704        379,921        290,349   

Operating expenses:

        

Compensation, operating and administrative expenses

     189,749        140,494        346,748        267,592   

Depreciation and amortization

     3,129        3,094        6,074        6,333   
  

 

 

   

 

 

   

 

 

   

 

 

 
     192,878        143,588        352,822        273,925   
  

 

 

   

 

 

   

 

 

   

 

 

 

Operating income

   $ 21,594      $ 11,116      $ 27,099      $ 16,424   
  

 

 

   

 

 

   

 

 

   

 

 

 

EBITDA

   $ 24,723      $ 14,210      $ 33,173      $ 22,757   
  

 

 

   

 

 

   

 

 

   

 

 

 

LASALLE INVESTMENT MANAGEMENT

        

Revenue:

        

Operating revenue

   $ 66,332      $ 59,368      $ 133,055      $ 124,782   

Equity earnings (losses)

     2,261        (2,817     (249     (9,132
  

 

 

   

 

 

   

 

 

   

 

 

 
     68,593        56,551        132,806        115,650   

Operating expenses:

        

Compensation, operating and administrative expenses

     52,194        46,184        106,812        96,211   

Depreciation and amortization

     1,070        1,270        1,622        2,169   
  

 

 

   

 

 

   

 

 

   

 

 

 
     53,264        47,454        108,434        98,380   
  

 

 

   

 

 

   

 

 

   

 

 

 

Operating income

   $ 15,329      $ 9,097      $ 24,372      $ 17,270   
  

 

 

   

 

 

   

 

 

   

 

 

 

EBITDA

   $ 16,399      $ 10,367      $ 25,994      $ 19,439   
  

 

 

   

 

 

   

 

 

   

 

 

 
        
                                  

Total segment revenue

     849,433        677,523        1,535,325        1,252,057   

Reclassification of equity earnings (losses)

     4,138        (2,796     2,168        (8,924
  

 

 

   

 

 

   

 

 

   

 

 

 

Total revenue

   $ 845,295      $ 680,319      $ 1,533,157      $ 1,260,981   
  

 

 

   

 

 

   

 

 

   

 

 

 

Total operating expenses before restructuring and acquisition charges

     773,616        618,982        1,449,412        1,180,530   
  

 

 

   

 

 

   

 

 

   

 

 

 

Operating income before restructuring and acquisition charges

   $ 71,679      $ 61,337      $ 83,745      $ 80,451   
  

 

 

   

 

 

   

 

 

   

 

 

 

Please reference attached financial statement notes.


JONES LANG LASALLE INCORPORATED

Consolidated Balance Sheets

June 30, 2011, December 31, 2010 and June 30, 2010

(in thousands)

 

     June 30,
2011
(Unaudited)
    December 31,
2010
    June 30,
2010
(Unaudited)
 

ASSETS

      

Current assets:

      

Cash and cash equivalents

   $ 95,615      $ 251,897      $ 54,994   

Trade receivables, net of allowances

     749,395        721,486        621,523   

Notes and other receivables

     113,019        76,374        80,035   

Warehouse receivables

     25,430        —          —     

Prepaid expenses

     48,647        41,195        41,729   

Deferred tax assets

     78,711        82,740        79,985   

Other

     11,416        21,149        16,443   
  

 

 

   

 

 

   

 

 

 

Total current assets

     1,122,233        1,194,841        894,709   

Property and equipment, net of accumulated depreciation

     226,231        198,685        192,498   

Goodwill, with indefinite useful lives

     1,775,713        1,444,708        1,399,668   

Identified intangibles, with finite useful lives, net of accumulated amortization

     59,263        29,025        30,856   

Investments in real estate ventures

     182,357        174,578        162,106   

Long-term receivables

     53,308        42,735        46,376   

Deferred tax assets

     141,934        149,020        139,283   

Other

     123,910        116,269        101,642   
  

 

 

   

 

 

   

 

 

 

Total assets

   $ 3,684,949      $ 3,349,861      $ 2,967,138   
  

 

 

   

 

 

   

 

 

 

LIABILITIES AND EQUITY

      

Current liabilities:

      

Accounts payable and accrued liabilities

   $ 370,873      $ 400,681      $ 300,903   

Accrued compensation

     378,517        554,841        302,341   

Short-term borrowings

     45,201        28,700        63,737   

Deferred tax liabilities

     3,942        3,942        1,164   

Deferred income

     59,069        45,146        36,775   

Deferred business acquisition obligations

     186,534        163,656        92,393   

Warehouse facility

     25,430        —          —     

Other

     91,854        99,346        105,069   
  

 

 

   

 

 

   

 

 

 

Total current liabilities

     1,161,420        1,296,312        902,382   

Noncurrent liabilities:

      

Credit facilities

     444,000        197,500        268,000   

Deferred tax liabilities

     20,051        15,450        7,797   

Deferred compensation

     10,771        15,130        21,013   

Pension liabilities

     4,748        5,031        6,579   

Deferred business acquisition obligations

     252,282        134,889        279,334   

Minority shareholder redemption liability

     17,329        34,118        33,273   

Other

     97,505        79,496        72,448   
  

 

 

   

 

 

   

 

 

 

Total liabilities

     2,008,106        1,777,926        1,590,826   

Company shareholders’ equity:

      

Common stock, $.01 par value per share, 100,000,000 shares authorized; 42,955,769, 42,659,999 and 42,059,599 shares issued and outstanding as of June 30, 2011, December 31, 2010, and June 30, 2010, respectively

     430        427        421   

Additional paid-in capital

     897,516        883,046        870,368   

Retained earnings

     715,229        676,397        559,188   

Shares held in trust

     (6,266     (6,263     (5,003

Accumulated other comprehensive income (loss)

     65,448        15,324        (51,532
  

 

 

   

 

 

   

 

 

 

Total Company shareholders’ equity

     1,672,357        1,568,931        1,373,442   

Noncontrolling interest

     4,486        3,004        2,870   
  

 

 

   

 

 

   

 

 

 

Total equity

     1,676,843        1,571,935        1,376,312   
  

 

 

   

 

 

   

 

 

 

Total liabilities and equity

   $ 3,684,949      $ 3,349,861      $ 2,967,138   
  

 

 

   

 

 

   

 

 

 

Please reference attached financial statement notes.


JONES LANG LASALLE INCORPORATED

Summarized Consolidated Statements of Cash Flows

For the Six Months Ended June 30, 2011 and 2010

(in thousands)

(Unaudited)

 

     Six Months Ended June 30,  
     2011     2010  

Cash used in operating activities

   $ (136,312   $ (80,363

Cash used in investing activities

     (257,927     (35,107

Cash provided by financing activities

     237,957        101,201   
                

Net decrease in cash and cash equivalents

     (156,282     (14,269

Cash and cash equivalents, beginning of period

     251,897        69,263   
                

Cash and cash equivalents, end of period

   $ 95,615      $ 54,994   
                

Please reference attached financial statement notes.


JONES LANG LASALLE INCORPORATED

Financial Statement Notes

 

1. Charges excluded from GAAP net income attributable to common shareholders to arrive at adjusted net income for the three and six-month periods ended June 30, 2011, and June 30, 2010 are primarily Restructuring and acquisition charges, intangible amortization related to the recent King Sturge acquisition, and non-cash co-investment charges. Below are reconciliations of GAAP net income attributable to common shareholders to adjusted net income and calculations of earnings per share (“EPS”) for each net income total:

 

     Three Months Ended
June 30,
     Six Months Ended
June 30,
 
($ in millions, except per share data)    2011      2010      2011      2010  

GAAP net income attributable to common shareholders

   $ 43.9       $ 31.8       $ 45.3       $ 32.0   

Shares (in 000s)

     44,473         44,250         44,391         44,085   
                                   

GAAP earnings per share

   $ 0.99       $ 0.72       $ 1.02       $ 0.73   
                                   

GAAP net income attributable to common shareholders

   $ 43.9       $ 31.8       $ 45.3       $ 32.0   

Restructuring and acquisition charges, net

     4.6         3.1         4.6         3.9   

Intangible amortization, net

     1.2         —           1.2         —     

Non-cash co-investment charges, net

     —           1.7         —           6.7   
                                   

Adjusted net income

     49.7         36.6         51.1         42.6   

Shares (in 000s)

     44,473         44,250         44,391         44,085   
                                   

Adjusted earnings per share

   $ 1.12       $ 0.83       $ 1.15       $ 0.97   
                                   

 

2. Adjusted EBITDA represents earnings before interest expense, net of interest income, income taxes, depreciation and amortization adjusted for Restructuring and acquisition charges, and non-cash co-investment charges. Although adjusted EBITDA and EBITDA are non-GAAP financial measures, they are used extensively by management and are useful to investors and lenders as metrics for evaluating operating performance and liquidity. The firm believes that adjusted EBITDA and EBITDA are indicators 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, adjusted EBITDA and EBITDA should not be considered as alternatives either to net income or net cash provided by (used in) operating activities, both of which are determined in accordance with GAAP. Because adjusted EBITDA and EBITDA are not calculated under GAAP, the firm’s adjusted EBITDA and EBITDA may not be comparable to similarly titled measures used by other companies.


Below is a reconciliation of net income to EBITDA and adjusted EBITDA (in thousands):

 

     Three Months Ended
June 30,
     Six Months Ended
June 30,
 
     2011      2010      2011      2010  

Net income attributable to common shareholders

   $   43,860       $   31,757       $ 45,350       $ 32,001   

Add:

           

Interest expense, net of interest income

     9,589         12,918         17,552         24,248   

Provision for income taxes

     15,029         9,574         15,562         9,698   

Depreciation and amortization

     19,350         17,532         37,665         35,246   
                                   

EBITDA

   $ 87,828       $ 71,781       $ 116,129       $ 101,193   
                                   

Add:

           

Restructuring and acquisition charges

     6,112         3,996         6,112         5,116   

Non-cash co-investment charges

     —           2,188         —           8,656   
                                   

Adjusted EBITDA

   $ 93,940       $ 77,965       $ 122,241       $ 114,965   
                                   

Below is a reconciliation of net cash provided by (used in) 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
June 30,
    Six Months Ended
June 30,
 
     2011      2010     2011     2010  

Net cash provided by (used in) operating activities

   $   60,867       $ 65,969      $ (136,312   $ (80,363

Add:

         

Interest expense, net of interest income

     9,589         12,918        17,552        24,248   

Change in working capital and non-cash expenses

     2,343         (16,680     219,327        147,610   

Provision for income taxes

     15,029         9,574        15,562        9,698   
                                 

EBITDA

   $ 87,828       $ 71,781      $ 116,129      $ 101,193   
                                 

Add:

         

Restructuring

     6,112         3,996        6,112        5,116   

Non-cash co-investment charges

     —           2,188        —          8,656   
                                 

Adjusted EBITDA

   $ 93,940       $ 77,965      $ 122,241      $ 114,965   
                                 


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 Real Estate Services businesses consisting primarily of tenant representation and agency leasing; capital markets; property management and facilities management; project and development services; and advisory, consulting and valuations 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 Quarterly Report on Form 10-Q for the quarter ended June 30, 2011, to be filed with the Securities and Exchange Commission shortly.

 

6. EMEA refers to Europe, Middle East and Africa. MENA refers to Middle East and North Africa. Greater China includes China, Hong Kong, Macau and Taiwan.

 

7. Certain prior year amounts have been reclassified to conform to the current presentation.