Cushman e Wakefield

(68.46% of share capital through EXOR S.A.)

 

The data presented and commented on below is taken from C&W Group’s consolidated accounting data as of and for the year ended December 31, 2013, prepared in accordance with International Financial Reporting Standards (“IFRS”).


  Change
$  million 2013 2012 Amount %
Net revenues (Commission and service fee) (A) 1,808.5 1,597.0 211.5 13.2
Reimbursed costs - managed properties and other costs (B) 690.1 453.1 237.0 52.3
Gross revenues (A+B) 2,498.6 2,050.1 448.5 21.9
Adjusted EBITDA (1) 130.1 127.7 2.4 1.9
EBITDA 119.1 127.7 (8.6) (6.7)
Operating income 89.1 79.1 10.0 12.6
Adjusted income attributable to owners of the parent (2) 34.0 26.0 8.0 30.8
Income attributable to owners of the parent, as reported 28.7 43.2 (14.5) (33.6)
1) EBITDA represents earnings before net interest expense, income taxes, and depreciation and amortization, while Adjusted EBITDA removes the impact of acquisition-related charges of $2.0 million and non-recurring reorganization-related charges of $9.0 million. Management believes that EBITDA and Adjusted EBITDA are useful in evaluating operating performance compared to that of other companies in the industry, as they assist in providing a more complete picture of results from operations. Because EBITDA and Adjusted EBITDA are not calculated under IFRS, C&W’s EBITDA and Adjusted EBITDA may not be comparable to similarly titled measures used by other companies. 2) Adjusted income attributable to owners of the parent excludes the tax-affected impacts of acquisition-related charges of $2.0 million and non-recurring reorganization-related charges of $9.0 million, respectively, in the current year, and certain non-recurring income tax net benefits of $3.8 million and $17.2 million, respectively, in the current year and the prior year.
$ million 12/31/2013 12/31/2012(3) Change
Equity attributable to owners of the parent 804.2 804.6 (0.4)
Consolidated net financial position 3.9 (87.4) 91.3
3) Following the application of the amendment to IAS 19 – Employee benefits, retrospectively, from January 1, 2013, figures previously reported in the statement of financial position at December 31, 2012 have been restated accordingly.

In 2013, C&W Group capitalized on the market’s strength to post double-digit commission and service fee revenues (“net revenues”) growth across all regions and nearly all service lines, including Capital Markets, Valuation & Advisory (“V&A”), Corporate Occupier & Investor Services (“CIS”) and Business Consulting, supported by continued investment in its strategic service lines across key global markets.

With respect to its financial performance for the full year, C&W Group reported double-digit gross revenue growth of 21.9%, or 22.8% excluding the impact of foreign exchange, to $2,498.6 million, as compared to $2,050.1 million for the same period in the prior year, while net revenues increased 13.2%, or 14.3% excluding the impact of foreign exchange, to $1,808.5 million, as compared to $1,597.0 million for the prior year period. 

The following presents the breakdown of gross and net revenues by geographical area:


  Change
$ million  2013 2012 Amount %
Americas 1,842.5 73.7% 1,484.2 72.4% 358.3 24.1
EMEA 463.8 18.6% 424.3 20.7% 39.5 9.3
Asia  192.3 7.7% 141.6 6.9% 50.7 35.8
Gross revenues 2,498.6 100.0% 2,050.1 100.0% 448.5 21.9
Americas 1,271.2 70.3% 1,135.9 71.1% 135.3 11.9
EMEA 399.1 22.1% 347.2 21.7% 51.9 14.9
Asia  138.2 7.6% 113.9 7.1% 24.3 21.3
Net revenues 1,808.5 100.0% 1,597.0 100.0% 211.5 13.2

Net revenues also increased across all three regions, all registering double-digit revenue growth, with notable revenue gains in the Americas, primarily in the U.S. where revenues grew $127.3 million, or 14.0%.

The following presents the breakdown of net revenues by service line:

 
  Change
$  million 2013 2012 Amount %
Leasing 892.3 49.4% 839.1 52.5% 53.2 6.3
Capital Markets 266.5 14.7% 217.2 13.6% 49.3 22.7
CIS  425.4 23.5% 342.7 21.5% 82.7 24.1
Valuation & Advisory 205.1 11.3% 181.0 11.3% 24.1 13.3
Business Consulting 19.2 1.1% 17.0 1.1% 2.2 12.9
Net revenues 1,808.5 100.0% 1,597.0 100.0% 211.5 13.2

From a service line perspective, net revenues were driven by strong growth across all service lines, with CIS, Capital Markets, V&A and Business Consulting registering double-digit growth, while Leasing revenue grew 6.3% year-over-year, despite weak market conditions.

The following table presents the changes in net revenues by region and by service line for the year ended 2013, as compared to the prior year:

 
Americas EMEA ASIA Total
$ million Change % Change % Change % Change %
Leasing 36.6 5.5 12.1 9.7 4.5 8.8 53.2 6.3
Capital Markets 28.6 21.5 17.1 25.4 3.6 21.3 49.3 22.7
CIS  51.7 25.1 14.6 14.3 16.4 47.8 82.7 24.1
Valuation & Advisory 16.8 12.8 6.8 5.7 0.5 7.5 24.1 13.3
Business Consulting 1.6 53.3 1.3 14.1 (0.7) (14.6) 2.2 12.9
Net revenues 135.3  11.9  51.9  14.9  24.3  21.3  211.5  13.2

CIS revenue performance, which reported double-digit revenue gains in all three regions, was primarily driven by outstanding performance in the Facilities, Project and Property Management subservice lines. Facilities Management contributed approximately $28.8 million to the total increase in CIS revenues, primarily in the Americas, which increased $21.9 million, evenly split between the U.S. and Latin America.  Project Management reported an increase of $27.9 million, primarily driven by the U.S. and Asia, where revenues grew $11.3 million and $11.4 million, respectively, while Property Management contributed $14.0 million, $6.3 million in EMEA, $4.7 million in the U.S. and $2.6 million in the Asia Pacific region. CIS revenue performance came from organic growth and new major client wins in the latter part of 2012 and in 2013, as well as targeted acquisitions, as the Company continues to expand its platform across the globe and enhance its recurring revenue streams through key hires and targeted acquisitions.

The Client Services Group (“CSG”), the Atlanta- and Dallas-based third party client services business acquired from Cousins Properties Incorporated, which was purchased by the Company on September 28, 2012, and the Singapore-based project management company Project Solution Group (“PSG”), which was acquired on July 1, 2013, contributed $8.5 million and $7.5 million, respectively to the total increase. Cushman & Wakefield also had a number of notable wins from well-known global companies and iconic brands including facilities management for Citigroup’s 27 million square foot real estate portfolio in the United States and Canada as well as property management of a 17 million square foot portfolio for DLF, the largest developer in India. Cushman & Wakefield was also appointed by British Airways as its preferred real estate services provider in the UK (Airport sites), EMEA and the U.S. as well as by the Port Authority of New York & New Jersey as Property Manager of the common areas and key operational facilities for the new World Trade Center campus in Lower Manhattan.

Leasing revenue performance, which also increased in all three regions driven by a strong performance in the second half of the year, was primarily attributable to revenue gains in the Office Leasing subservice line, up $32.8 million, followed by Industrial and Retail Leasing revenues, up $12.0 million and $9.8 million, respectively, reflecting C&W’s ability to drive year-over-year growth amid an improving, yet sluggish economic climate. Cushman & Wakefield’s Leasing business remains well positioned to capture opportunities presented by recovering markets, as evidenced by appointments as exclusive leasing agent for two major office towers in Manhattan, 75 Rockefeller Plaza and 1221 Avenue of the Americas, as well as joint marketing agent in Singapore to lease both Marina One and DUO. Cushman & Wakefield also won assignments in London with the leasing mandate on the Scalpel, WR Berkley’s 400,000 square foot iconic development in London and as Retail & Leisure consultant on the 1 million square feet Battersea Power Station development. In addition, Group was chosen by Syniverse Technologies for a strategic tenant advisory assignment for a 200,000 square foot Class A global headquarters.

Capital Markets strong performance in all three regions was primarily attributable to revenue gains in the Investment Sales & Acquisitions segment of the business, which, alone, contributed $44.3 million of the total increase, reflecting improved business confidence across the globe, as investors are becoming less risk averse when it comes to investing their capital. Capital Markets executed several high profile assignments, including advising Mitsubishi Estate Company on the sale of King Edward Court, the headquarters building of the London Stock Exchange, to Oxford Properties for £235 million and Aberdeen Asset Management Deutschland AG on the sale of the "Park", a complex of twelve office buildings in Prague, to an affiliate of Starwood Capital Group, the largest investment deal in the Czech Republic ever. Other successes include arranging the sale of a 30-story office building at 113 Argyle Street in Hong Kong for $372 million, representing ownership in the $400 million sale of a ground lessor’s position at 625 Madison Avenue to Ashkenazy Acquisition Corporation and representing St. John’s University in the sale of 101 Murray Street to a partnership between Fisher Brothers and The Witkoff Group for $223 million, the largest residential development site sale in Lower Manhattan.

The V&A business, which, along with CIS, is a major component of the Company’s strategic growth plan and initiatives to enhance recurring revenue streams, also continued to grow steadily, primarily in the U.S., Latin America and the EMEA region, where revenues grew $10.7 million, or 9.5%, $6.7 million, or 15.6%, and $4.8 million, or 93.3%, respectively, fueled by higher Capital Markets transactions.  Momentum in V&A’s business was driven by a national scope assignment of over 700 department stores, distribution centers and a corporate headquarters campus for a major U.S. retailer. V&A was also appointed to value the retail element of Canary Wharf, in the U.K., consisting of over 200 retail units and 68,300 square meters, on behalf of Canary Wharf Group PLC, as well as to appraise the 1,501 room Mandarin Orchard and the 125,293 square foot Mandarin Gallery for OUE Hospitality Trust prior to one of Singapore’s largest hotel and retail asset Initial Public Offerings (”IPO”) in recent years.

Operating expenses for the year ended December 31, 2013 increased $110.3 million, or 12.7%, to $979.4 million, as compared to $869.1 million for the prior year, primarily due to increases in employment-related expenses and other direct costs in line with C&W Group’s revenue growth and strategic plan initiatives. Also included in operating expenses for the current year are certain acquisition and non-recurring reorganization-related charges of approximately $4.6 million, which are excluded from Adjusted EBITDA.

At the operating level, C&W Group’s income rose $10.0 million, or 12.6%, to $89.1 million for the full year 2013, as compared to $79.1 million in the prior year.

Other expense, net increased $18.8 million to $19.9 million for the year ended December 31, 2013, as compared to $1.1 million for the prior year, primarily due to an increase in the charge related to C&W’s non-controlling shareholder put option liability of $14.5 million, largely attributable to an increase in share repurchase requirements in excess of previous estimates and certain non-recurring reorganization charges of $4.4 million, which are excluded from Adjusted EBITDA, and an acquisition-related charge in the current year period of approximately $2.0 million, which is also excluded from Adjusted EBITDA.

Adjusted EBITDA was $130.1 million for the current year, representing an increase of $2.4 million over EBITDA of $127.7 million for 2012, which was not impacted by any acquisition or non-recurring reorganization-related charges.  EBITDA, as reported, decreased $8.6 million to $119.1 million in 2013, as compared to full-year 2012.

The Company recorded income tax expense of $32.0 million for the full year 2013, as compared to $26.3 million for the prior year. The increase in income tax expense for the year ended December 31, 2013, as compared to the prior year, is primarily attributable to certain non-recurring income tax benefits in the prior year.

Adjusted income attributable to owners of the parent increased $8.0 million, or 30.8%, to $34.0 million, as compared to Adjusted income attributable to owners of the parent of $26.0 million for the prior year. The income attributable to owners of the parent, as reported, decreased to $28.7 million for the year ended December 31,  2013, from $43.2 million in the prior year.

C&W Group’s net financial position improved $91.3 million to a positive $3.9 million (principally cash in excess of debt) as of December 31, 2013, as compared to a negative $87.4 million (principally debt in excess of cash) as of December 31, 2012.

Commercial Register No.64236277 Legal notes | Credits