Business Services Industry
Trammell Crow Company Announces 2005 Results; Full Year EPS Increase of 55%; Global Services Pre-Tax Profits up 79%
Business Wire, Feb 21, 2006
Trammell Crow Company
Statements of Income
(in thousands, except share and per share data)
(UNAUDITED)
For the Year For the Three Months
Ended December 31, Ended December 31,
----------------------- ------------------------
2005 2004 2005 2004
----------- ----------- ------------ -----------
(A) (A) (A)
Revenues:
User Services:
Facilities management $237,659 $211,062 $64,055 $57,117
Corporate advisory
services 186,847 143,266 72,560 52,846
Project management
services 118,678 91,599 33,175 30,694
----------- ----------- ------------ -----------
543,184 445,927 169,790 140,657
Investor Services:
Property management 136,665 137,193 33,864 33,539
Brokerage 138,416 114,478 41,664 37,702
Construction
management 11,973 11,187 3,592 4,200
----------- ----------- ------------ -----------
287,054 262,858 79,120 75,441
Development and
construction 47,159 38,346 20,907 14,073
----------- ----------- ------------ -----------
877,397 747,131 269,817 230,171
Gain on disposition
of real estate 18,553 26,742 8,794 15,172
----------- ----------- ------------ -----------
Total Revenues 895,950 773,873 278,611 245,343
Costs and expenses:
Salaries, wages and
benefits 553,552 493,404 154,310 144,489
Commissions 151,721 120,345 52,882 43,727
General and
administrative 140,618 127,758 38,372 38,154
Depreciation and
amortization 9,995 11,344 2,537 2,668
Interest 5,441 4,195 1,538 1,202
----------- ----------- ------------ -----------
Total Expenses 861,327 757,046 249,639 230,240
----------- ----------- ------------ -----------
Operating income 34,623 16,827 28,972 15,103
Interest and other
income 2,835 2,797 761 673
----------- ----------- ------------ -----------
Income from
continuing
operations before
income taxes,
minority interest
and income from
investments in
unconsolidated
subsidiaries 37,458 19,624 29,733 15,776
Income tax expense (13,856) (7,452) (11,044) (5,897)
Minority interest,
net of income taxes
(B) 2,528 (3,006) 1,207 (3,223)
Income from
investments in
unconsolidated
subsidiaries, net of
income taxes (B) 15,154 10,971 9,090 2,620
----------- ----------- ------------ -----------
Income from
continuing
operations 41,284 20,137 28,986 9,276
Income from
discontinued
operations, net of
income taxes (B) 18,123 18,982 5,587 18,676
----------- ----------- ------------ -----------
Net income $59,407 $39,119 $34,573 $27,952
=========== =========== ============ ===========
Diluted income per
share:
Income from
continuing
operations $1.13 $0.54 $0.79 $0.26
Income from
discontinued
operations 0.50 0.51 0.15 0.51
----------- ----------- ------------ -----------
Net income $1.63 $1.05 $0.94 $0.77
=========== =========== ============ ===========
Weighted average
common shares
outstanding 36,440,940 37,239,801 36,880,842 36,205,412
=========== =========== ============ ===========
Net income $59,407 $39,119 $34,573 $27,952
Depreciation and
amortization (C) 10,627 11,604 2,652 2,707
Interest (D) 7,344 4,830 1,672 1,425
Income tax expense 34,880 23,954 20,662 16,379
----------- ----------- ------------ -----------
EBITDA (E) $112,258 $79,507 $59,559 $48,463
=========== =========== ============ ===========
(A) In accordance with the discontinued operations provisions of FAS
144, certain revenues and expenses for the nine months ended
September 30, 2005, and for the three months and year ended December
31, 2004, have been reclassified to conform to the presentation for
the three months ended December 31, 2005. These reclassifications did
not have any impact on net income or EBITDA.
(B) Income tax expense has been calculated
using an effective tax rate applicable to
these line items.
(C) Includes depreciation and amortization related to discontinued
operations of $115 and $632 for the three months and year ended
December 31, 2005, respectively, and $39 and $260 for the three
months and year ended December 31, 2004, respectively.
(D) Includes interest related to discontinued operations of $134 and
$1,903 for the three months and year ended December 31, 2005,
respectively, and $223 and $635 for the three months and year ended
December 31, 2004, respectively.
(E) EBITDA represents earnings before interest, income taxes and
depreciation and amortization. The Company believes that EBITDA is a
meaningful measure of the Company's operating performance, cash
generation and ability to service debt. However, EBITDA should not be
considered as an alternative to: (1) net earnings (determined in
accordance with accounting principles generally accepted in the
United States ("GAAP")); (2) operating cash flow (determined in
accordance with GAAP); or (3) liquidity. The Company also believes
that EBITDA is sometimes useful to compare the operating results of
companies within an industry due to the fact that it eliminates the
effects of certain financing and accounting decisions. The Company's
calculation of EBITDA may, however, differ from similarly titled
items reported by other companies.
Trammell Crow Company
Balance Sheet
(in thousands)
December 31, December 31,
2005 2004
--------------------------
(A)
Assets:
Current assets
Cash and cash equivalents $76,919 $163,637
Restricted cash 1,416 9,950
Accounts receivable, net of allowance
for doubtful accounts 127,784 103,551
Receivables from affiliates 2,146 1,626
Notes and other receivables 16,303 20,825
Deferred income taxes 3,935 4,021
Real estate under development (B) 129,963 9,564
Real estate and other assets held for
sale (C) 20,791 49,637
Available for sale securities 542 --
Other current assets 27,399 17,657
------------ -------------
Total current assets 407,198 380,468
Furniture and equipment, net 19,787 18,649
Deferred income taxes 16,270 22,935
Real estate under development (B) 117,210 56,394
Real estate held for investment (B) 89,906 106,157
Investments in unconsolidated subsidiaries
(D) 175,411 74,090
Goodwill, net 75,239 74,357
Receivables from affiliates 7,458 --
Available for sale securities 18,089 --
Other assets 21,599 15,900
------------ -------------
$948,167 $748,950
============ =============
Liabilities and Stockholders' Equity:
Current liabilities
Accounts payable $31,698 $23,731
Accrued expenses 155,760 146,026
Payables to affiliates 4 40
Income taxes payable 16,313 18,121
Current portion of long-term debt 1,302 6
Current portion of notes payable on
real estate 133,941 10,263
Liabilities related to real estate and
other assets held for sale (E) 17,508 31,643
Other current liabilities 5,944 12,585
------------ -------------
Total current liabilities 362,470 242,415
Long-term debt, less current portion 35,034 8
Notes payable on real estate, less current
portion 106,216 110,794
Other liabilities 13,448 10,027
------------ -------------
Total liabilities 517,168 363,244
Minority interest 29,528 44,756
Stockholders' equity
Preferred stock -- --
Common stock 379 379
Paid-in capital 205,084 196,314
Retained earnings 240,887 190,252
Accumulated other comprehensive income 1,713 2,043
Less: Treasury stock (32,776) (36,921)
Unearned stock compensation,
net (13,816) (11,117)
------------ -------------
Total stockholders' equity 401,471 340,950
------------ -------------
$948,167 $748,950
============ =============
(A) In accordance with FAS 144, certain assets and liabilities at
December 31, 2004, have been reclassified to conform to the
presentation at December 31, 2005.
(B) Total real estate owned was $357,613 and $220,985 at December 31,
2005 and December 31, 2004, respectively.
(C) Real estate and other assets
held for sale consist of the
following: December 31, 2005 December 31, 2004
-----------------------------------
Real estate (B) $20,534 $48,870
Other assets 257 767
----------------- -----------------
$20,791 $49,637
================= =================
(D) Investments in unconsolidated
subsidiaries consist of the
following: December 31, 2005 December 31, 2004
-----------------------------------
Real estate development $44,496 $39,829
Other 130,915 34,261
----------------- -----------------
$175,411 $74,090
================= =================
(E) Liabilities related to real
estate and other assets held for
sale consist of the following: December 31, 2005 December 31, 2004
----------------- -----------------
Notes payable on real estate $16,001 $28,647
Other liabilities 1,507 2,996
----------------- -----------------
$17,508 $31,643
================= =================
Trammell Crow Company
Summarized Operating Data by Segment
(in thousands)
(UNAUDITED)
For the Year For the Three Months
Ended December 31, Ended December 31,
-------------------- -----------------------
2005 2004 2005 2004
---------- --------- ---------- ------------
(A) (A) (A)
Global Services:
Total revenues $831,703 $710,814 $249,111 $217,752
Operating costs and
expenses 778,333 682,723 223,107 201,236
---------- --------- ---------- ------------
Operating income 53,370 28,091 26,004 16,516
Interest and other income 2,136 1,424 546 320
---------- --------- ---------- ------------
Income from continuing
operations before income
taxes, minority interest
and income from
investments in
unconsolidated
subsidiaries 55,506 29,515 26,550 16,836
Minority interest, before
income taxes 556 560 274 57
Income from investments
in unconsolidated
subsidiaries, before
income taxes 11,160 7,252 5,405 2,440
---------- --------- ---------- ------------
Income from continuing
operations, before
income taxes 67,222 37,327 32,229 19,333
Income from discontinued
operations, before
income taxes 1,178 965 613 926
---------- --------- ---------- ------------
Income before income
taxes 68,400 38,292 32,842 20,259
Depreciation and
amortization 7,726 9,314 1,870 2,102
Interest 1,282 622 342 231
---------- --------- ---------- ------------
EBITDA (B) $77,408 $48,228 $35,054 $22,592
========== ========= ========== ============
Development and
Investment:
Total revenues $64,247 $63,059 $29,500 $27,591
Operating costs and
expenses 82,994 74,323 26,532 29,004
---------- --------- ---------- ------------
Operating income (loss) (18,747) (11,264) 2,968 (1,413)
Interest and other income 699 1,373 215 353
---------- --------- ---------- ------------
Income (loss) from
continuing operations
before income taxes,
minority interest and
income from investments
in unconsolidated
subsidiaries (18,048) (9,891) 3,183 (1,060)
Minority interest, before
income taxes 3,457 (5,406) 1,662 (5,268)
Income from investments
in unconsolidated
subsidiaries, before
income taxes 12,892 10,437 9,111 1,234
---------- --------- ---------- ------------
Income (loss) from
continuing operations,
before income taxes (1,699) (4,860) 13,956 (5,094)
Income from discontinued
operations, before
income taxes 27,586 29,641 8,437 29,166
---------- --------- ---------- ------------
Income before income
taxes 25,887 24,781 22,393 24,072
Depreciation and
amortization (C) 2,901 2,290 782 605
Interest (D) 6,062 4,208 1,330 1,194
---------- --------- ---------- ------------
EBITDA (B) $34,850 $31,279 $24,505 $25,871
========== ========= ========== ============
Total:
Total revenues $895,950 $773,873 $278,611 $245,343
Operating costs and
expenses 861,327 757,046 249,639 230,240
---------- --------- ---------- ------------
Operating income 34,623 16,827 28,972 15,103
Interest and other income 2,835 2,797 761 673
---------- --------- ---------- ------------
Income from continuing
operations before income
taxes, minority interest
and income from
investments in
unconsolidated
subsidiaries 37,458 19,624 29,733 15,776
Minority interest, before
income taxes 4,013 (4,846) 1,936 (5,211)
Income from investments
in unconsolidated
subsidiaries, before
income taxes 24,052 17,689 14,516 3,674
---------- --------- ---------- ------------
Income from continuing
operations, before
income taxes 65,523 32,467 46,185 14,239
Income from discontinued
operations, before
income taxes 28,764 30,606 9,050 30,092
---------- --------- ---------- ------------
Income before income
taxes 94,287 63,073 55,235 44,331
Depreciation and
amortization (C) 10,627 11,604 2,652 2,707
Interest (D) 7,344 4,830 1,672 1,425
---------- --------- ---------- ------------
EBITDA (B) $112,258 $79,507 $59,559 $48,463
========== ========= ========== ============
(A) In accordance with the discontinued operations provisions of FAS
144, certain revenues and expenses for the nine months ended
September 30, 2005, and for the three months and year ended December
31, 2004, have been reclassified to conform to the presentation for
the three months ended December 31, 2005. These reclassifications did
not have any impact on net income or EBITDA.
(B) EBITDA represents earnings before interest, income taxes and
depreciation and amortization. The Company believes that EBITDA is a
meaningful measure of the Company's operating performance, cash
generation and ability to service debt. However, EBITDA should not be
considered as an alternative to: (1) net earnings (determined in
accordance with accounting principles generally accepted in the
United States ("GAAP")); (2) operating cash flow (determined in
accordance with GAAP); or (3) liquidity. The Company also believes
that EBITDA is sometimes useful to compare the operating results of
companies within an industry due to the fact that it eliminates the
effects of certain financing and accounting decisions. The Company's
calculation of EBITDA may, however, differ from similarly titled
items reported by other companies.
(C) Includes depreciation and amortization related to discontinued
operations of $115 and $632 for the three months and year ended
December 31, 2005, respectively, and $39 and $260 for the three
months and year ended December 31, 2004, respectively.
(D) Includes interest related to discontinued operations of $134 and
$1,903 for the three months and year ended December 31, 2005,
respectively, and $223 and $635 for the three months and year ended
December 31, 2004, respectively.
Trammell Crow Company
Other Data
(UNAUDITED)
December 31, 2005 December 31, 2004
----------------- -----------------
Number of Brokers (A) 670 632
Development Inventory (in
millions):
In process inventory $3,597 $2,628
Pipeline inventory 2,706 2,491
----------------- -----------------
Total Inventory $6,303 $5,119
================= =================
(A) The number of brokers includes transaction managers who work on
the Company's various user accounts. Information at December 31,
2004 has been restated to include brokers in this area.
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