01—Abstract
Summary
Summary of the 10-K filed February 29, 2016. Cited figures are marked; the original filing is the authoritative source.
CBRE Group, Inc. reported strong revenue growth of 20.0% to $10.86 billiona for the fiscal year ended December 31, 2015.
This growth was significantly driven by the strategic acquisition of Johnson Controls' Global Workplace Solutions (GWS) business in September 2015, alongside robust organic growth across its key service lines. The company demonstrated resilience, with net income attributable to CBRE Group, Inc. rising by 12.9% to $547.1 millionb, reflecting effective operational management and strategic integration of acquired assets. Geographically, the Americas remained the largest segment, but EMEA showed substantial revenue growth, partly due to the GWS acquisition.
The company's diversified service offerings, including advisory services and outsourcing solutions, continue to perform well, indicating a solid market position. CBRE's financial health is further supported by a strong balance sheet, though it carries significant long-term debt, which was managed through strategic refinancing activities.
02—Key points
Key Highlights
- Revenue increased by 20.0% to $10.86 billion in 2015, driven by organic growth and the significant acquisition of GWS.
- Net income attributable to CBRE Group, Inc. grew by 12.9% to $547.1 million, indicating improved profitability.
- The company experienced strong organic growth across advisory services (sales, leasing, appraisal, mortgage brokerage) and outsourcing services.
- EMEA segment revenue saw significant growth of 28.2%, bolstered by the GWS acquisition.
- Global Investment Management revenue saw a slight decrease of 1.8% due to foreign currency fluctuations and lower fee income.
- Total debt was managed through several refinancing efforts, including new senior notes issuances and term loan facilities.
- The company did not declare or pay any cash dividends, intending to reinvest earnings for future growth and debt reduction.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in FY2015, CBRE Group, Inc. kept $0.05.
- Revenue$10.86B100.0%
- Cost of revenue−$40.4M0.4%
- Gross profit$10.82B99.6%
- Operating costs−$9.98B91.9%
- Operating income$835.9M7.7%
- Interest, other & tax−$288.8M2.7%
- Net income$547.1M5.0%
Where FY2015 revenue went
$10.86B- Operating costs: $9.98B, 92% of revenue
- Net income: $547.1M, 5.0% of revenue
- Cost of revenue: $40.4M, 0.4% of revenue
- Interest, other & tax: $288.8M, 2.7% of revenue
Kept 5.0% as net incomeNet income $547.1M · 5.0%Cost of revenue $40.4M · 0.4%
Full revenue history →04—Financials
Financial Highlights
Figures from 10-KFY2015filed February 29, 2016Financial Statements
FY2015 against FY2014
| Line item | FY2015FY2014 | Change |
|---|---|---|
| Revenue | $10.86B$9.05B | +20.0% |
| Cost of Revenue | $40.44M— | — |
| Gross Profit | $10.82B— | — |
| Operating Expenses | $10.03B$8.32B | +20.6% |
| Operating Income | $835.94M$792.25M | +5.5% |
| Interest Expense | $118.88M$112.03M | +6.1% |
| Net Income | $547.13M$484.50M | +12.9% |
| EPS (Basic) | $1.64$1.47 | +11.6% |
| EPS (Diluted) | $1.63$1.45 | +12.4% |
| Shares Outstanding (Basic) | 332.62M330.62M | +0.6% |
| Shares Outstanding (Diluted) | 336.41M334.17M | +0.7% |
05—Questions
Frequently Asked Questions
What was the main driver of revenue growth in 2015?
The primary driver of revenue growth in 2015 was the acquisition of Johnson Controls' Global Workplace Solutions (GWS) business, which closed in September 2015. This was supplemented by strong organic growth across the company's core service lines, including property, facilities, and project management, as well as sales and leasing activities.
How did the GWS acquisition impact CBRE's financial performance?
The GWS acquisition significantly boosted revenue, particularly in the Americas and EMEA segments. While it increased costs of services and operating expenses due to integration, the overall impact contributed positively to the company's top-line growth and expanded its global workplace solutions offering.
What is CBRE's dividend policy?
CBRE Group, Inc. has not declared or paid any cash dividends on its common stock since its inception and does not anticipate doing so in the foreseeable future. The company intends to retain future earnings to finance growth and potentially reduce debt.
How does CBRE manage its significant debt load?
CBRE has actively managed its debt through refinancing activities, taking advantage of market conditions to issue new senior notes with favorable terms and establish new term loan facilities. The company's credit agreements include covenants that the company is required to maintain, and as of December 31, 2015, it was in compliance with these covenants.
06—Continue