Jones Lang Lasalle Inc. (JLL) reported net income of $44 million or 99 cents per share in the second quarter of 2011 compared with $32 million or 72 cents per share in the year-earlier quarter.
Adjusted net income stood at $50 million or $1.12 per share for the second quarter of 2011 versus $37 million or 83 cents per share in the year-earlier quarter. Reported earnings surpassed the Zacks Consensus Estimate by two cents.
Revenues in the reported quarter were $845 million compared with $680 million delivered in the year-ago quarter. Earnings before interest, taxes, depreciation and amortization (EBITDA) in second quarter 2011 were $94 million, up from $78 million in the year-ago quarter.
Revenues from ‘Real Estate Services’ were $779 million in the reported quarter compared with $620.9 million in the second quarter of 2010, up approximately 19% in local currency. Region wise, revenues from the Americas stood at $348.4 million, reflecting a year-over-year increase of 17% in local currency, while EMEA (Europe, Middle East, and Africa) revenues increased 15% in local currency to $218.0 million.
In the Asia-Pacific region, revenues in the reported quarter surged 26% in local currency to $214.5 million. The solid year-over-year revenue growth across all the regions was attributable to strong income from ‘Capital Markets & Hotels’ Project & Development Services’ and ‘Leasing’, which improved 49%, 24% and 16%, respectively, during the quarter.
Advisory fees from the LaSalle Investment Management segment increased approximately 16% to $65.0 million in the reported quarter .The segment garnered net equity of $2.3 billion during the quarter. At quarter end, assets under management were $45.3 billion. Total operating expenses were $774 million in the quarter compared with $619 million in the year-ago period.
At the end of the quarter, Jones Lang had a net debt of $832 million, arising from the King Sturge acquisition in the quarter. Outstanding debt on the long-term credit facility was $444 million at quarter end.
Jones Lang generated a healthy year-over-year increase in revenue and profit in the second quarter of fiscal 2011. The completion of the King Sturge acquisition during the quarter will enable the company to gain traction in key markets. Despite slow economic growth and concern over government finances, the cyclical recovery in the real estate industry continues. Management further expects to continue the growth momentum in fiscal 2011 with gradual improvement in market fundamentals.
Jones Lang currently retains a Zacks #3 Rank, which translates into a short-term Hold rating. We are also maintaining our long-term Neutral recommendation on the stock. One of its competitors, CB Richard Ellis Group, Inc. (CBG) currently retains a Zacks #3 Rank.
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