Brokers who lease and sell commercial real-estate properties have been hurt as the recession causes companies to trim office space and tighter credit has made it harder to buy property.CBRE reported a net loss of $54.4 million, or 14 cents a share, compared with year-earlier net income of $15.3 million, or 10 cents a share.
The latest results included $15.7 million in write-offs from a credit agreement amendment reached last month and $7.9 million in expenses related to severance and office-closure costs. Excluding items, the loss would have been 3 cents a share, compared with year-earlier income of 15 cents.
Revenue slid 28% to $890.4 million.
Analysts polled by Thomson Reuters expected per-share earnings of 2 cents on revenue of $983 million.
Revenue in CBRE's real-estate development and investment business in the U.S. decreased 25% amid a drop in construction revenue, as the segment reported an larger operating loss of $18.8 million compared with an operating loss of $10.3 million.
Global investment-management revenue decreased 5.6% amid lower acquisition, disposition and incentive fees. Still, the segment swung to an operating profit of $6.7 million from an operating loss of $2.1 million a year ago.
CBRE said it has cut, or targeted for elimination, $475 million to $500 million in operating expense cuts from 2007 levels, including $385 million that have already been implemented.
Last month, the company said its lenders agreed to ease the terms of its credit agreement, giving CBRE more flexibility to navigate weak market conditions. The news prompted investment ratings upgrades from JMP Securities and JPMorgan.
Shares fell 2.6% to $6.40 in after-hours trading. The company's stock has lost nearly two-thirds of its value from September.
Source: Morningstar 29 April 2009
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