Cushman & Wakefield (NYSE: CWK) today reported financial results for the second quarter of 2023:
Year-to-Date Results:
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Revenue of $4.7 billion and service line fee revenue of $3.1 billion for the first half of 2023 decreased 6% and 13%, respectively, from the first half of 2022.
- Property, facilities and project management grew 4%, driven by the Americas and APAC.
- Leasing, Capital markets and Valuation and other declined 20%, 49% and 14%, respectively.
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Net loss and diluted loss per share for the first half of 2023 were $71.3 million and $0.31, respectively.
- Adjusted EBITDA of $207.0 million was down 57% from the first half of 2022.
- Adjusted diluted earnings per share of $0.18 was down from $1.10 in the first half of 2022.
- We achieved $49.0 million of gross cost savings in the first half of 2023 and have increased our full year gross cost savings target to $130.0 million.
- Liquidity as of June 30, 2023 was $1.6 billion, consisting of availability on the Company's undrawn revolving credit facility of $1.1 billion and cash and cash equivalents of $0.5 billion.
Second Quarter Results:
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Revenue of $2.4 billion and service line fee revenue of $1.6 billion for the second quarter of 2023 decreased 8% and 15%, respectively, from the second quarter of 2022.
- Property, facilities and project management grew 2%.
- Leasing, Capital markets and Valuation and other declined 20%, 48% and 13%, respectively.
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Net income and diluted earnings per share for the second quarter of 2023 were $5.1 million and $0.02, respectively.
- Adjusted EBITDA of $146.1 million was down 44% from the second quarter of 2022.
- Adjusted diluted earnings per share of $0.22 was down from $0.63 in the second quarter of 2022.
“I am pleased with Cushman & Wakefield’s second quarter results, as we reported sequential improvements in revenue and Adjusted EBITDA and continued to execute on our strategic priorities,” said Michelle MacKay, Cushman & Wakefield Chief Executive Officer. “As anticipated, transactional markets remained under pressure during the quarter, while our services business showed resiliency, highlighting the benefits of our diversified platform. Today’s complex macroeconomic landscape requires comprehensive and thoughtful client engagement, and Cushman & Wakefield’s teams continue to provide outstanding service across the globe. We remain focused on strategic growth areas throughout our platform and continue to strengthen our overall position.”
Consolidated Results (unaudited) | |||||||||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||
(in millions, except per share data) | 2023 | 2022 | % Change
| % Change
| 2023 | 2022 | % Change
| % Change
| |||||||||||||
Revenue: | |||||||||||||||||||||
Property, facilities and project management | $ | 888.9 | $ | 868.8 | 2 | % | 3 | % | $ | 1,785.7 | $ | 1,709.8 | 4 | % | 5 | % | |||||
Leasing | 441.8 | 552.8 | (20 | )% | (20 | )% | 804.4 | 1,007.5 | (20 | )% | (19 | )% | |||||||||
Capital markets | 191.9 | 367.3 | (48 | )% | (48 | )% | 334.8 | 656.3 | (49 | )% | (49 | )% | |||||||||
Valuation and other | 110.3 | 127.5 | (13 | )% | (13 | )% | 212.0 | 247.6 | (14 | )% | (12 | )% | |||||||||
Total service line fee revenue(1) | 1,632.9 | 1,916.4 | (15 | )% | (14 | )% | 3,136.9 | 3,621.2 | (13 | )% | (13 | )% | |||||||||
Gross contract reimbursables(2) | 773.1 | 696.2 | 11 | % | 12 | % | 1,518.4 | 1,322.4 | 15 | % | 16 | % | |||||||||
Total revenue | $ | 2,406.0 | $ | 2,612.6 | (8 | )% | (7 | )% | $ | 4,655.3 | $ | 4,943.6 | (6 | )% | (5 | )% | |||||
Costs and expenses: | |||||||||||||||||||||
Cost of services provided to clients | $ | 1,205.0 | $ | 1,381.3 | (13 | )% | (12 | )% | $ | 2,367.3 | $ | 2,615.6 | (9 | )% | (9 | )% | |||||
Cost of gross contract reimbursables | 773.1 | 696.2 | 11 | % | 12 | % | 1,518.4 | 1,322.4 | 15 | % | 16 | % | |||||||||
Total costs of services | 1,978.1 | 2,077.5 | (5 | )% | (4 | )% | 3,885.7 | 3,938.0 | (1 | )% | 0 | % | |||||||||
Operating, administrative and other | 328.9 | 317.5 | 4 | % | 4 | % | 644.8 | 610.9 | 6 | % | 7 | % | |||||||||
Depreciation and amortization | 35.7 | 39.7 | (10 | )% | (10 | )% | 72.6 | 80.3 | (10 | )% | (9 | )% | |||||||||
Restructuring, impairment and related charges | 7.0 | 1.3 | n.m. | n.m. | 14.2 | 2.5 | n.m. | n.m. | |||||||||||||
Total costs and expenses | 2,349.7 | 2,436.0 | (4 | )% | (3 | )% | 4,617.3 | 4,631.7 | 0 | % | 1 | % | |||||||||
Operating income | 56.3 | 176.6 | (68 | )% | (68 | )% | 38.0 | 311.9 | (88 | )% | (88 | )% | |||||||||
Interest expense, net of interest income | (57.9 | ) | (46.1 | ) | 26 | % | 25 | % | (134.7 | ) | (89.3 | ) | 51 | % | 52 | % | |||||
Earnings from equity method investments | 12.8 | 17.5 | (27 | )% | (26 | )% | 24.7 | 34.4 | (28 | )% | (28 | )% | |||||||||
Other expense, net | (4.8 | ) | (25.0 | ) | (81 | )% | (81 | )% | (10.8 | ) | (57.9 | ) | (81 | )% | (83 | )% | |||||
Earnings (loss) before income taxes | 6.4 | 123.0 | (95 | )% | (95 | )% | (82.8 | ) | 199.1 | n.m. | n.m. | ||||||||||
Provision for (benefit from) income taxes | 1.3 | 25.8 | (95 | )% | (95 | )% | (11.5 | ) | 56.4 | n.m. | n.m. | ||||||||||
Net income (loss) | $ | 5.1 | $ | 97.2 | (95 | )% | (95 | )% | $ | (71.3 | ) | $ | 142.7 | n.m. | n.m. | ||||||
Net income (loss) margin | 0.2 | % | 3.7 | % | (1.5 | )% | 2.9 | % | |||||||||||||
Adjusted EBITDA(3) | $ | 146.1 | $ | 262.8 | (44 | )% | (44 | )% | $ | 207.0 | $ | 477.1 | (57 | )% | (56 | )% | |||||
Adjusted EBITDA margin(3) | 8.9 | % | 13.7 | % | 6.6 | % | 13.2 | % | |||||||||||||
Adjusted net income(3) | $ | 50.5 | $ | 142.9 | (65 | )% | $ | 41.1 | |||||||||||||
