Jones Lang LaSalle Incorporated (NYSE:JLL - News), a leading real estate investment trust (:REIT), reported fourth quarter 2011 net income of $84.8 million or $1.91 per share compared to $84.4 million or $1.91 in the year-earlier quarter. Excluding non-recurring items, earnings were $114 million or $2.56 per share during the quarter versus $86 million or $1.94 in the year-ago quarter. Recurring earnings for the reported quarter were well above the Zacks Consensus Estimate of $2.21.
For full year 2011, Jones Lang reported net income of $164 million or $3.70 per share compared to $154 million or $3.48 in 2010. Excluding non-recurring items, earnings for fiscal 2011 were $215 million or $4.83 per share versus $166 million or $3.77 in the previous year.
Total revenue for the reported quarter were $1,148.2 million compared to $956.3 million in the year-ago quarter. Revenue during the quarter exceeded the Zacks Consensus Estimate of $1,112 million. Adjusted earnings before interest, taxes, depreciation and amortization (adjusted EBITDA) were $179 million for fourth quarter 2011 compared with $143 million for the same period in 2010.
For fiscal 2011, Jones Lang reported record revenues at $3,584.5 million compared to $2,925.6 billion recorded in 2010. The healthy year-over-year increase in revenue was primarily due to strong performances across all business segments and geographic regions except the LaSalle Investment Management segment. Adjusted EBITDA for fiscal 2011 was $395 million compared with $337 million for fiscal 2010.
By segment, revenues from the Americas region came in at $509.5 million in fourth quarter 2011, reflecting a year-over-year increase of 19%, while that in EMEA (Europe, Middle East, and Africa) increased 45% to $340.3 million. In the Asia-Pacific region, revenue growth during the quarter was 6% to $235.9 million. The year-over-year increase in revenue across all the segments was largely due to strong income from ‘Capital Markets and Hotels’ and ‘Project & Development Services’ during the quarter, which improved 50% and 29% respectively on a local currency basis.
Total revenue from LaSalle Investment Management segment was $66.2 million during the quarter, representing a year-over-year decline of 1%. The segment raised net capital of $5.0 billion during the year. At year-end 2011, assets under management were $47.7 billion.
Total operating expenses (excluding restructuring charges) were $1.0 billion for the quarter – a year-over-year increase of about 20%. For full year 2011, total operating expenses (excluding restructuring charges) were $3.3 billion compared with $2.7 billion in 2010. Cash and cash equivalents at year-end 2011 were $184.5 million compared to $251.9 million in the prior year period.
At year-end 2011, Jones Lang had an outstanding debt of $463 million. During the year, the company reduced its net debt position by over $180 million driven by strong cash flows generated from operations and modest cash outflows due to disciplined capital expenditures, effective tax management and low cash interest expense associated with reduced borrowing levels. The strategic moves were aimed at strengthening the balance sheet, increasing liquidity to meet current commitments and capitalizing on potential opportunities.
Jones Lang is one of the best-positioned commercial real estate services companies, maintaining steady margin improvements in line with stable revenue growth. We believe that the company is well on course to continue its strong performance in the coming quarters as well.
We maintain our ‘Neutral’ rating on Jones Lang, which presently has a Zacks #3 Rank translating into a short-term Hold recommendation. We also have a ‘Neutral’ rating and a Zacks #3 Rank for CBRE Group, Inc. (NYSE:CBG - News), a competitor of Jones Lang.Read the Full Research Report on JLL
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