CBRE Group, Inc. (NYSE:CBRE) Q3 2019 Earnings Conference Call - Final Transcript

Nov 06, 2019 • 08:30 am ET


CBRE Group, Inc. (NYSE:CBRE) Q3 2019 Earnings Conference Call - Final Transcript


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Greetings. Welcome to CBRE's Third Quarter 2019 Earnings Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions] Please note this conference is being recorded.

I will now turn the conference over to your host, Mr. Brad Burke. Please go ahead.

Bradley Burke

Thank you and welcome to CBRE's third quarter 2019 earnings conference call. Earlier today, we issued a press release announcing our financial results and it is posted on the Investor Relations page of our website,, along with a presentation slide deck that you can use to follow along with our prepared remarks as well as an Excel file that contains additional supplemental materials.

Our agenda for this morning's call will be as follows: First, I'll provide an overview of our financial results for the quarter. Next, Bob Sulentic, our President and CEO; and Leah Stearns, our CFO, will discuss our third quarter results in more detail. After these comments, we'll open up the call for your questions.

Before I begin, I'll remind you that this presentation contains forward-looking statements that involve a number of risks and uncertainties. Examples of these statements include our expectations regarding CBRE's future growth momentum, operations, market share, business outlook, capital deployment, acquisition, integration and financial performance, including our 2019 outlook, and any other statements regarding matters that are not historical facts.

We urge you to consider these factors and remind you that we undertake no obligation to update the information contained on this call to reflect subsequent events or circumstances. You should be aware that these statements should be considered estimates only and certain factors may affect us in the future that could cause actual results to differ materially from those expressed in these forward-looking statements. For a full discussion of the risks and other factors that may impact these forward-looking statements, please refer to this morning's earnings press release and our most recent annual and quarterly reports filed on Form 10-K and Form 10-Q respectively.

We have provided reconciliations of adjusted EPS, adjusted EBITDA and fee revenue and certain other non-GAAP financial measures included in our remarks to the most directly comparable GAAP measures, together with explanations of these measures in the appendix of the presentation slide deck.

Now, please turn to Slide 4 of our presentation, which highlights our financial results for the third quarter of 2019. Third quarter adjusted earnings per share was flat at $0.79. Strong top and bottom line growth within our two services segments, Advisory Services and Global Workplace Solutions, was offset by a decline in adjusted EBITDA in our Real Estate Investment segment. The $85 million of adjusted EBITDA realized in Real Estate Investments in last year's third quarter represented an all-time record for the segment. On a combined basis, our two services segments generated fee revenue growth and adjusted EBITDA growth of over 11% and 16% respectively. In addition, the combined adjusted EBITDA margin for our Advisory and Global Workplace Solutions segments expanded approximately 70