CHICAGO— Jones Lang LaSalle Incorporated (NYSE: JLL) reported adjusted EPS for 2012 of $5.48, up from $4.83 last year. Record full-year revenue of $3.9 billion was up 12 percent in local currency. Fee revenue was $3.6 billion, an increase of 10 percent.
"Our 2012 performance met our expectations, with a strong finish to the year in challenging global markets," said Colin Dyer, Chief Executive Officer of Jones Lang LaSalle. "Again, we continue to secure market share growth, productivity improvements and expanded client relationships. Our quarterly and full-year performance leaves us confident that we will continue to progress in 2013," Dyer added.
Consolidated fee revenue growth for the full year was driven by solid Leasing performance and continued growth in Property & Facility Management. Leasing revenue grew 9 percent in local currency for the year, with the largest growth in the Americas. Property & Facility Management fee revenue rose 13 percent in local currency, also led by the Americas region, which increased 15 percent in local currency, followed by Asia Pacific, up 13 percent. LaSalle Investment Management's advisory fees decreased from 2011 due to significant asset and portfolio sales, but have remained consistent throughout each quarter of 2012. LaSalle generated $23 million of incentive fees and $24 million of equity earnings during the year.
Consolidated quarter-to-date revenue rose to $1.2 billion, 9 percent higher in local currency than the fourth quarter of 2011, and was up 8 percent on a fee revenue basis.
Operating expenses, excluding restructuring and acquisition charges, were $3.6 billion for the year, an increase of 10 percent, 12 percent in local currency, compared with $3.3 billion in 2011. The increase was driven by higher variable compensation resulting from improved Leasing revenue, as well as higher compensation resulting from increased headcount primarily to service new and expanded Property & Facility Management contracts. Compensation expense was further impacted by the firm's previously disclosed decision to eliminate its Stock Ownership Program ("SOP"), which resulted in approximately $11 million of accelerated compensation expense in the current year, a timing difference rather than a permanent increase in compensation, as well as a timing difference of $5 million related to the acceleration of the final deferred payment for the Staubach acquisition and extension of employment agreements with the majority of the Staubach shareholders who are working in the firm. Fee-based operating expenses1, excluding restructuring and acquisition charges, were $3.3 billion, an increase of 9 percent in local currency, also mostly attributable to higher compensation expense.
Full-year results included $45 million of restructuring and acquisition charges, principally related to integration and retention costs for the second-quarter 2011 acquisition of King Sturge, but also including severance and lease exit costs in targeted areas of the business that are anticipated to remain economically challenged for an extended period of time. The firm's results also included $5 million of intangibles amortization related to the King Sturge acquisition.