Jones Lang LaSalle : JLL : Reports Second-Quarter 2015 Adjusted Earnings per Share of $2.01, 20 Percent Above Last Year

CHICAGO, IL--(Marketwired - Jul 29, 2015) - Jones Lang LaSalle Incorporated (NYSE: JLL) today reported adjusted earnings per share of $2.01, up from $1.68 in the prior year. Second-quarter fee revenue totaled $1.2 billion, up 17 percent from the second quarter of 2014. All percentage variances are calculated on a local currency basis.

• Record second-quarter fee revenue with double-digit growth across all four segments
  
  
• Year-to-date margin expansion in all segments with ongoing investments for future revenue and profit growth
  
  
• Capital Markets & Hotels momentum and market share growth continues; Corporate Solutions secures significant client wins and adds to strong pipeline
  
  
• LaSalle Investment Management year-to-date capital raise of $3 billion; outstanding performance for clients and shareholders
  
  
• Acquisitions increasing; 10 transactions announced in 2015
  
  
• JLL's credit rating upgraded to BBB+ (Stable) by Standard & Poor's on July 28, 2015
  

CEO Comment:
"We are pleased with another record quarter, with double-digit revenue growth in all business segments, the product of years of consistent, disciplined investment across all areas of our company," said Colin Dyer, President and CEO of JLL. "We remain positive on our prospects for the second half of 2015, with solid momentum across all service lines and markets," Dyer added.

Consolidated Performance Highlights:

• Consolidated fee revenue for the second quarter was $1.2 billion, up 17 percent from 2014. Growth was broad-based, led by Capital Markets, up $41 million or 33 percent, and Project & Development Services, up $19 million or 29 percent.
• Consolidated fee-based operating expenses, excluding restructuring and acquisition charges, were $1.1 billion for the second quarter, compared with $989 million last year, an increase of 17 percent.
• LaSalle Investment Management's advisory fees grew 8 percent while healthy transaction and incentive fees contributed to a total revenue increase of 24 percent. LaSalle also recognized significant equity earnings from legacy investment dispositions.
• Adjusted EBITDA margin calculated on a fee revenue basis was 13.3 percent for the second quarter, compared with 12.2 percent last year.
• Adjusted earnings per share reached $2.01 for the second quarter, up 20 percent from last year despite a negative foreign exchange impact of approximately $0.15 compared with a year ago.
  
  

Balance Sheet and Net Interest Expense:

• JLL's credit rating upgraded to BBB+ (Stable) by Standard & Poor's on July 28, 2015. This upgrade reflects the second time in eight months that S&P has improved JLL's debt rating.
• The firm's total net debt was $522 million at quarter end, a decrease of $24 million from the first quarter 2015 and $150 million from the second quarter last year. 
• Net interest expense for the second quarter was $7.6 million, down from $7.7 million in the second quarter of 2014. Slightly higher borrowing costs partially offset lower average borrowings compared with last year.
  
  

Business Segment Performance Highlights

Americas Real Estate Services

Americas Performance Highlights:

• Fee revenue for the quarter was $545 million, an increase of 11 percent from 2014. Revenue growth compared with last year was broad-based, with Capital Markets & Hotels up 30 percent, Project & Development Services up 22 percent, and Advisory, Consulting and Other up 36 percent.
• Fee-based operating expenses, excluding restructuring and acquisition charges, were $499 million for the quarter, up 14 percent from last year. The quarter included investments in technology to support our clients and platform to support the growing business.
• Operating income was $46 million for the quarter, compared with $47 million in 2014. Year-to-date operating income was $81 million, up from $64 million in 2014.
• Adjusted EBITDA was $61 million for the quarter, compared with $60 million last year. Adjusted EBITDA margin, for the quarter, calculated on a fee revenue basis, was 11.3 percent, compared with 12.2 percent in 2014. Year-to-date Adjusted EBITDA was $112 million, up from $91 million in 2014. Year-to-date Adjusted EBITDA margin calculated on a fee revenue basis was 10.7 percent, compared with 10.1 percent in 2014.
  
  

EMEA Real Estate Services

EMEA Performance Highlights:

• EMEA's performance during the second quarter was significantly higher in local currencies than in U.S. dollars due to the strength of the U.S. dollar against European currencies.
• Fee revenue for the quarter was $327 million, an increase of 21 percent from 2014. Revenue growth was driven by Capital Markets & Hotels, up 38 percent, and Project & Development Services up 36 percent, compared with last year. Growth in the region was broad-based, led by the UK, Germany, Sweden, and Central and Eastern Europe.
• Fee-based operating expenses, excluding restructuring and acquisition charges, were $295 million for the quarter, compared with $284 million last year.
• Operating income was $32 million for the quarter, compared with $25 million in 2014. Year-to-date operating income was $29 million, up from $20 million in 2014.
• Adjusted EBITDA was $38 million for the quarter, compared with $30 million last year. Adjusted EBITDA margin calculated on a fee revenue basis was 11.7 percent for the quarter, compared with 9.8 percent in 2014. Year-to-date Adjusted EBITDA was $41 million, up from $31 million in 2014. Year-to-date Adjusted EBITDA margin calculated on a fee revenue basis was 7.0 percent, compared with 5.7 percent in 2014.
  
  

Asia Pacific Real Estate Services

Asia Pacific Performance Highlights:

• Asia Pacific's performance during the second quarter was significantly higher in local currencies than in U.S. dollars due to the strength of the U.S. dollar, particularly against the Australian dollar and Japanese yen.
• Fee revenue for the quarter was $231 million, an increase of 18 percent from 2014. Revenue growth was driven by Capital Markets & Hotels, up 25 percent, and Project & Development Services, up 38 percent, compared with last year. Growth in the region was broad-based, led by Japan, Australia, India and Singapore.
• Fee-based operating expenses, excluding restructuring and acquisition charges, were $215 million for the quarter, compared with $199 million last year, an increase of 13 percent.
• Operating income was $16 million for the quarter, in-line with 2014. Year-to-date operating income was $21 million, up from $17 million in 2014.
• Adjusted EBITDA was $20 million for the quarter, compared with $19 million last year. Adjusted EBITDA margin calculated on a fee revenue basis was 8.6 percent for the quarter, compared with 8.9 percent in 2014. Year-to-date Adjusted EBITDA was $28 million, up from $23 million in 2014. Year-to-date Adjusted EBITDA margin calculated on a fee revenue basis was 6.6 percent, compared with 6.0 percent in 2014.
  
  

LaSalle Investment Management

LaSalle Investment Management Performance Highlights:

• Total segment revenue was $106 million for the quarter, compared with $82 million last year. This included $8 million of transaction fees and other income, $12 million of incentive fees and $25 million of equity earnings.
• Equity earnings grew significantly for the quarter, driven by the sale of assets as LaSalle realizes gains from legacy investments.
• Operating expenses were $68 million for the quarter, compared with $59 million last year.
• Operating income was $38 million for the quarter, compared with $22 million last year. 
• Adjusted EBITDA was $38 million for the quarter, compared with $23 million last year. Adjusted EBITDA margin was 36.0 percent, compared with 27.9 percent in 2014. Year-to-date Adjusted EBITDA was $66 million, up from $40 million in 2014. Year-to-date Adjusted EBITDA margin was 32.8 percent, compared to 25.7 percent in 2014.
• Capital raise was $948 million for the quarter and $3.0 billion year-to-date.
• Assets under management were $56.0 billion as of June 30, 2015, up from $55.3 billion as of March 31, 2015. The net increase in assets under management resulted from $3.5 billion of acquisitions and takeovers, $2.5 billion of dispositions and withdrawals, $1.3 billion of net valuation increases and $1.6 billion of net foreign currency decreases.
  
  

About JLL
JLL (NYSE: JLL) is a professional services and investment management firm offering specialized real estate services to clients seeking increased value by owning, occupying and investing in real estate. A Fortune 500 company with annual fee revenue of $4.7 billion and gross revenue of $5.4 billion, JLL has more than 230 corporate offices, operates in more than 80 countries and has a global workforce of approximately 58,000. On behalf of its clients, the firm provides management and real estate outsourcing services for a property portfolio of 3.4 billion square feet, or 316 million square meters, and completed $118 billion in sales, acquisitions and finance transactions in 2014. Its investment management business, LaSalle Investment Management, has $56.0 billion of real estate assets under management. JLL is the brand name, and a registered trademark, of Jones Lang LaSalle Incorporated. For further information, visit www.jll.com.

200 East Randolph Drive Chicago Illinois 60601 | 30 Warwick Street London W1B 5NH | 9 Raffles Place #39-00 Republic Plaza Singapore 048619

Cautionary Note Regarding Forward-Looking Statements
Statements in this news release regarding, among other things, future financial results and performance, achievements, plans and objectives and dividend payments may be considered forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements involve known and unknown risks, uncertainties and other factors which may cause actual results, performance, achievements, plans and objectives and dividend payments of JLL to be materially different from those expressed or implied by such forward-looking statements. For additional information concerning risks, uncertainties and other factors that could cause actual results to differ materially from those anticipated in forward-looking statements, and risks to JLL's business in general, please refer to those factors discussed under "Business," "Management's Discussion and Analysis of Financial Condition and Results of Operations," "Quantitative and Qualitative Disclosures about Market Risk," and elsewhere in JLL's Annual Report on Form 10-K for the year ended December 31, 2014, on Form 10-Q for the quarter ended March 31, 2015, and in other reports filed with the Securities and Exchange Commission. There can be no assurance that future dividends will be declared since the actual declaration of future dividends, and the establishment of record and payment dates, remains subject to final determination by the Company's Board of Directors. Any forward-looking statements speak only as of the date of this release, and except to the extent required by applicable securities laws, JLL expressly disclaims any obligation or undertaking to publicly update or revise any forward-looking statements contained herein to reflect any change in JLL's expectations or results, or any change in events.

Conference Call
Management will conduct a conference call with shareholders, analysts and investment professionals on Wednesday, July 29, 2015 at 9:00 a.m. EDT.

If you would like to participate in the teleconference, please dial into one of the following phone numbers five to ten minutes before the start time (the passcode will also be required):

U.S. callers:  +1 877 800 0896
International callers:  +1 706 679 7364
Passcode:  78003651

Webcast
We are also offering a live webcast. Follow these steps to participate:

1. You must have a minimum 14.4 Kbps Internet connection
2. Log on to http://www.visualwebcaster.com/event.asp?id=102619
3. Download free Windows Media Player software: (link located under registration form)
4. If you experience problems listening, please call the Webcast Hotline +1 877 863 2113 and provide your Event ID (102619).

Supplemental Information
Supplemental information regarding the second-quarter 2015 earnings call has been posted to the Investor Relations section of the company's website: www.jll.com.

Conference Call Replay
Available: 12:00 p.m. EDT Wednesday, July 29, 2015 through 11:59 p.m. EDT Sunday, August 30, 2015 at the following numbers:

U.S. callers:  +1 855 859 2056  or + 1 800 585 8367
International callers:  +1 404 537 3406   
Passcode:  78003651   

Web Audio Replay
An audio replay will be available for download or stream. Information and the link can be found on the company's website: www.jll.com.

If you have any questions, please contact JLL's Investor Relations department at: JLLInvestorRelations@am.jll.com.

1. Consistent with U.S. GAAP ("GAAP"), gross contract vendor and subcontractor costs ("gross contract costs") which are managed on certain client assignments in the Property & Facility Management and Project & Development Services business lines are presented on a gross basis in both revenue and operating expenses. Gross contract costs are excluded from revenue and operating expenses in determining "fee revenue" and "fee-based operating expenses," respectively. Excluding these costs from revenue and operating expenses more accurately reflects how the firm manages its expense base and its operating margins.

Adjusted operating income excludes the impact of restructuring and acquisition charges. "Adjusted operating income margin" is calculated by dividing adjusted operating income by fee revenue. Below are reconciliations of revenue and operating expenses to fee revenue and fee-based operating expenses, as well as adjusted operating income margin calculations, for the three and six months ended June 30, 2015 and 2014.

*See note 4 for more information on restructuring and acquisition charges

2. Net restructuring and acquisition charges are excluded from GAAP net income attributable to common shareholders to arrive at adjusted net income for the three and six months ended June 30, 2015, and 2014. Below are reconciliations of GAAP net income attributable to common shareholders to adjusted net income and calculations of earnings per share for each net income total:

*See note 4 for more information on restructuring and acquisition charges

3. Adjusted EBITDA represents earnings before interest expense net of interest income, income taxes, depreciation and amortization, adjusted for restructuring and acquisition charges. Although adjusted EBITDA and EBITDA are non-GAAP financial measures, they are used extensively by management and are useful to investors and lenders as metrics for evaluating operating performance and liquidity. EBITDA is used in the calculations of certain covenants related to the firm's revolving credit facility. However, adjusted EBITDA and EBITDA should not be considered as an alternative to net income determined in accordance with GAAP. Because adjusted EBITDA and EBITDA are not calculated under GAAP, the firm's adjusted EBITDA and EBITDA may not be comparable to similarly titled measures used by other companies.

Below is a reconciliation of net income to EBITDA and adjusted EBITDA:

4. Restructuring and acquisition charges are excluded from segment operating results, although they are included for consolidated reporting. For purposes of segment operating results, the allocation of restructuring and acquisition charges to the segments has been determined not to be meaningful to investors, so the performance of segment results has been evaluated without allocation of these charges.

5. Each geographic region offers the firm's full range of Real Estate Services businesses consisting primarily of tenant representation and agency leasing; capital markets; property management and facilities management; project and development services; and advisory, consulting and valuations services. LaSalle Investment Management provides investment management services to institutional investors and high-net-worth individuals.

6. The consolidated statements of cash flows are presented in summarized form. For complete consolidated statements of cash flows, please refer to the firm's Quarterly Report on Form 10-Q for the quarter ended June 30, 2015, to be filed with the Securities and Exchange Commission shortly.

7. EMEA refers to Europe, Middle East and Africa. MENA refers to Middle East and North Africa. Greater China includes China, Hong Kong, Macau and Taiwan. Southeast Asia refers to Singapore, Indonesia, Philippines, Thailand and Vietnam. The BRIC countries include Brazil, Russia, India and China.

8. Certain prior year amounts have been reclassified to conform to the current presentation.