Jones Lang Lasalle (News)

JONES LANG LASALLE REPORTS SECOND QUARTER RESULTS

Chicago and London, July 31, 2001 - Jones Lang LaSalle Incorporated (NYSE: JLL), the leading global real estate services and investment management firm, today reported a second quarter net loss of $1.9 million, or $.06 per share, just below the range it had forecast three months ago. This result compares to a net loss of $12.4 million, or $.50 per share, for the second quarter of 2000. The comparable adjusted net income for the second quarter of 2000 was $6.7 million, or $.22 per share, which excludes non-cash compensation expense of $18.9 million associated with the Jones Lang Wootton merger.

For the second quarter of 2001, adjusted EBITDA was $14.9 million versus $28.3 million for the same period of 2000. Revenues were $198.6 million compared with $223.3 million in the comparable period a year ago.

"While we were slightly below our expectations for the quarter, we are not disappointed in our results given the continued slowdown of the global economy," said Stuart L. Scott, Chairman and Chief Executive Officer of Jones Lang LaSalle. "However, with the timing of any recovery uncertain, we are adjusting our earnings expectations for the full year to no less than $1.31 per share, which matches our 2000 adjusted earnings. At a time when the effects of the downturn in the U.S. economy are spreading around the world, we believe matching last year's outstanding results will underscore the resilience and strength of the platform we have built to serve our clients."

Business Segment Performance Highlights

Chris Peacock, President and Chief Operating Officer of Jones Lang LaSalle, said: "Despite the current realities of the worldwide economy, we are encouraged by our strong backlog and new wins in many of our businesses. In an effort to address this challenging environment, we are cutting discretionary costs in every area of our Company. During this period, our primary focus will be, as always, to help our clients with their real estate and investment decisions."

The following summary of business segment results compares the second quarter of 2001 to the same period of the previous year. The segment results have been restated to reflect both the consolidation of the former Hotel Services segment into the regional Owner and Occupier Services segments and the implementation of SAB 101 for the year 2000.

Owner and Occupier Services

The Americas region had another strong quarter, with revenues up nearly 10 percent to $74.5 million in the current year versus $67.4 million in the second quarter of 2000 due primarily to a 17 percent increase in the management services business. Operating expenses included a $1.0 million write-off against an e-commerce investment and $1.5 million for severance fees. Increased expenses resulted in $2.1 million of operating income versus $3.9 million last year.
In Europe, the second quarter operating income of $5.0 million was roughly equal to last year's period. Revenues of $78.2 million were essentially flat after considering the impact of almost $12 million in revenue concentrated in two capital markets transactions in the prior year.
Economic fundamentals in Asia Pacific continued to worsen, causing the region to report an operating loss of $2.9 million in the second quarter compared with a loss of $1.5 million last year. Revenues declined to $28.3 million this period versus $33.7 million in the second quarter of 2000, entirely as a result of reduced transaction business. Management services income continued its positive momentum.

Investment Management

LaSalle Investment Management recorded second quarter revenues of $18.2 million and an operating loss of $0.5 million versus revenues of $30.8 million and an operating income of $9.9 million in the prior year. The difference was the direct result of the confluence of several large incentive fees in last year's second quarter.

Outlook for Remainder of 2001

"Our business is strong and our clients are consistently turning to us for our global capabilities, but the current worldwide economic slowdown has caused them to focus intensely on controlling costs. While this situation bodes well for our outsourcing business, the uncertainty has resulted in clients hesitating to enter into major commitments and delaying many planned projects. As a result, we are revising our guidance on full year operating EPS to at least $1.31, which is equal to last year's performance (after implementing SAB 101). This figure would exclude one-time charges, if any, for creating operational efficiencies," said Mr. Scott.

In addition, the forecast does not include the impact of certain previously disclosed one-time, non-operational issues:

The undetermined exposure, which is not expected to exceed $1.5 million, due to the liquidation of a large Australian insurance company that provided public liability coverage for the Company's Australian operations from 1994 through 1997; and
The effect of the turbulence in the technology capital markets on the Company's e-commerce investments.

Jones Lang LaSalle is the world's leading real estate services and investment management firm, operating across more than 100 markets on five continents. The company provides comprehensive integrated expertise, including management services, implementation services and investment management services on a local, regional and global level to owners, occupiers and investors. Jones Lang LaSalle is also the industry leader in property and corporate facility management services, with a portfolio of approximately 700 million square feet (65 million square meters) under management worldwide. LaSalle Investment Management, the company's investment management business, is one of the world's largest and most diverse real estate investment management firms, with more than $23 billion of assets under management.

Download Second Quarter 2001 Financials (.xls format)

Statements in this press release regarding, among other things, future financial results and performance, achievements, plans and objectives 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 of Jones Lang LaSalle to be materially different from those expressed or implied by such forward-looking statements. Factors that could cause actual results to differ materially include those 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 Jones Lang LaSalle's Annual Report on Form 10-K for the year ended December 31, 2000, in Jones Lang LaSalle's Proxy Statement dated April 6, 2001, in Jones Lang LaSalle's Quarterly Report on Form 10-Q for the quarter ended March 31, 2001 and in other reports filed with the Securities and Exchange Commission. Statements speak only as of the date of this release. Jones Lang LaSalle expressly disclaims any obligation or undertaking to update or revise any forward-looking statements contained herein to reflect any change in Jones Lang LaSalle's expectations or results, or any change in events.

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