CB Richard Ellis Group, Inc. Reports Second Quarter Revenue Increase of 65%, Earnings Per Share Rise of 94% and Raises Guidance for 2007

Business Wire, July 30, 2007

Operating income for the Americas region totaled $92.2 million for the second quarter of 2007, compared with $84.0 million for the second quarter of 2006. Excluding the impact of one-time items, operating income for the Americas region would have been $116.5 million for the second quarter of 2007, an increase of $31.1 million, or 36.4%, as compared to $85.4 million for the second quarter of last year. The Americas region's EBITDA totaled $116.5 million for the second quarter of 2007, an increase of $21.3 million from last year's second quarter despite the inclusion of $14.9 million6 of acquisition-related expenses.

EMEA Region

Revenue for the EMEA region increased 72.2% to $330.8 million for the second quarter of 2007, compared with $192.2 million for the second quarter of 2006. This revenue increase was mostly organic and was primarily driven by strong performance in the United Kingdom, France, Germany and Spain.

Operating income for the EMEA segment totaled $64.5 million for the second quarter of 2007, compared with $32.5 million for the same period last year. Excluding the impact of one-time items, operating income for the EMEA region would have been $65.0 million for the second quarter of 2007, an increase of $32.0 million, or 97.2%, from the second quarter of last year. EBITDA for the EMEA region totaled $67.2 million for the second quarter of 2007, an increase of $31.4 million, or 87.8%, from last year's second quarter.

Asia Pacific Region

In the Asia Pacific region, which includes operations in Asia, Australia and New Zealand, revenue totaled $121.8 million for the second quarter of 2007, a 39.6% increase from $87.2 million for the second quarter of 2006. This revenue increase was predominantly organic and was driven by improved performance in Australia, China, Singapore and Japan.

Operating income for the Asia Pacific segment doubled to $24.6 million for the second quarter of 2007 compared to $12.3 million for the same period last year. EBITDA for the Asia Pacific segment totaled $23.1 million for the second quarter of 2007, an increase of $10.9 million, or 89.9%, from last year's second quarter.

The Asia Pacific segment did not incur any significant one-time costs in the current or prior year quarter.

Global Investment Management Business

In the Global Investment Management segment, which consists of investment management operations in the U.S., Europe and Asia, revenue totaled $83.8 million for the second quarter of 2007, a 210.3% increase from the $27.0 million recorded in the second quarter of 2006. This increase was mainly due to higher carried interest revenue earned and higher investment management fees in the U.S. and the U.K. The increase in investment management fees, a recurring revenue stream, was driven by growth in assets under management to $33.2 billion as of the end of the second quarter, up $4.6 billion, or 16.1%, from year-end 2006.

This segment reported operating income of $28.5 million for the second quarter of 2007, compared with an operating loss of $1.0 million for the same period last year. EBITDA for this segment totaled $41.1 million for the second quarter of 2007, an increase of $37.2 million, or 963.3%, from last year's second quarter. The improved performance was mainly attributable to the aforementioned increase in carried interest revenue and asset management fees. As compared with the prior year second quarter, revenue recognized from funds liquidating (carried interest revenue) increased by $24.1 million; however, it was partially offset by $5.9 million of higher incentive compensation expense recognized for dedicated executives and team leaders associated with this segment's carried interest programs.