Commercial real estate services firm CB Richard Ellis Group Inc. (CBG), Wednesday reported a profit for the fourth quarter over a net loss last year, due mainly to the absence of a hefty goodwill and asset impairment charge. Adjusted earnings for the quarter exceeded Street expectations, as did revenues. Looking ahead, the company provided its earnings growth outlook for fiscal 2010.
Net income attributable to the company was $64.3 million or $0.21 per share for the fourth quarter, compared to a loss of $1.1 billion or $4.70 per share in the prior year quarter.
The Los Angeles, California-based company posted net income of $51.1 million, compared to a loss of $1.1 billion in the previous year quarter.
Result for the year-ago included goodwill and other non-amortizable intangible asset impairment charge of $1.10 billion, and write-down of impaired assets of $47.80 million.
Excluding items, adjusted net income dropped to $86.0 million or $0.28 per share from $87.7 million or $0.37 per share in the year-ago quarter. On average, 7 analysts polled by Thomson Reuters expected the company to report earnings of $0.18 per share for the fourth quarter. Analysts' estimates typically exclude special items.
Fourth quarter revenue increased to $1.30 billion from $1.28 billion in the same quarter last year. Four analysts had a consensus revenue estimate of $1.16 billion for the fourth quarter.
Brett White, president and chief executive officer of CB Richard Ellis, said, "Fourth quarter results were by far our best for the year, and we achieved quarterly year-over-year top-line growth for the first time in seven quarters. Stronger fourth-quarter performance is consistent with historical seasonal trends, which normally see us generate higher revenue and profits as the year progresses."
Revenue for the Americas region, including the U.S., Canada and Latin America, fell about 7% to $769.3 million for the fourth quarter of 2009.
Revenue for the EMEA region, which mainly consists of operations in Europe, rose 8% to $287.1 million over a year ago.
In the Asia Pacific region, which includes operations in Asia, Australia and New Zealand, revenue soared 43% year-over-year to $177.0 million.
During the fourth quarter of 2009, CB Richard Ellis noted that its investment sales activity rebounded well in Europe and Asia Pacific, compared with last year's depressed levels. In the Americas, investment sales revenue grew for the first time in nine quarters, but at a more modest rate than in Europe and Asia Pacific.
In the Global Investment Management segment, which includes investment management operations in the U.S., Europe and Asia, revenue dropped slightly by 1% to $38.7 million from the prior year quarter.
In the Development Services segment, which consists of real estate development and investment activities primarily in the U.S., revenue slipped 17% to $24.5 million over a year ago.
Total costs and expenses for the fourth quarter eased to $1.2 billion from $2.3 billion in the prior year quarter.
For fiscal 2009, net income attributable to CB Richard Ellis was $33.3 million or $0.12 per share, compared to a loss of $1.0 billion or $4.81 per share in the previous year.
On an adjusted basis, net income dropped to $109.8 million or $0.39 per share from $208.7 million or $0.97 per share in the prior year.
Annual revenue decreased to $4.17 billion from $5.13 billion in the year-ago.
Analysts expected the company to report earnings of $0.27 per share on revenue of $4.03 billion for the year 2009.
For fiscal 2010, CB Richard Ellis anticipates earnings per share growth in the range of 15% to 20%, and revenue growth of 6% to 8%. Street estimates earnings of $0.50 per share on revenue of $4.27 billion for the year 2010.
Over the past two years, the company has not provided any guidance regarding its short term earnings prospects. However, owing to the emerging global economy, the company provided its annual forecast for 2010.
Among others in the industry, Jones Lang Lasalle Inc. (JLL) reported a 26% year-over-year increase in profit for the fourth quarter, reflecting lower charges, targeted cost actions and revenue growth.
Jones Lang Lasalle noted that it benefited from solid performance in the Americas driven by corporate outsourcing and the successful integration of Staubach Co., a commercial brokerage that was acquired in July 2008, as well as improved fourth-quarter transaction performance and annuity revenue growth in the Asia Pacific region.
CB Richard Ellis closed Wednesday's regular trading at $13.69, up 20 cents or 1.48%, on a volume of 6.21 million shares. In the after-hours, the shares lost 9 cents. The stock has been moving in a range of $2.34 - $14.38 for the past 52 weeks, with an average daily volume of about 3.61 million shares for the past three months.
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