<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
DATE OF REPORT (DATE OF EARLIEST EVENT REPORTED): NOVEMBER 3, 1997
CB COMMERCIAL REAL ESTATE SERVICES GROUP, INC.
- --------------------------------------------------------------------------------
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
DELAWARE 0-18525 52-1616016
- ------------------ ---------------- ------------------
(STATE OR OTHER (COMMISSION FILE (IRS EMPLOYER
JURISDICTION OF NUMBER) IDENTIFICATION NO.)
INCORPORATION)
533 SOUTH FREMONT AVENUE - LOS ANGELES, CALIFORNIA 90071
--------------------------------------------------------------------------
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE (213) 613-3123
--------------
- --------------------------------------------------------------------------------
(FORMER NAME OR FORMER ADDRESS, IF CHANGED SINCE LAST REPORT)
<PAGE>
ITEM 5. OTHER EVENTS.
On November 3, 1997, CB Commercial Real Estate Services Group, Inc. (the
"Company") issued a press release announcing developments in its facilities
management operation and joint venture in New England. The Company also
announced that its common stock will be traded on the New York Stock Exchange
beginning November 7, 1997. The press release is filed as an exhibit hereto.
On November 4, 1997, the Company issued a press release announcing its
results of operations for the quarter and nine-month periods ended September 30,
1997. The press release is filed as an exhibit hereto.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.
The following is furnished as exhibits to this report:
99.1 Press release dated November 3, 1997 issued by CB Commercial Real
Estate Services Group, Inc.
99.2 Press release dated November 4, 1997 issued by CB Commercial Real
Estate Services Group, Inc.
-2-
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this amendment to be signed on its behalf by the
undersigned thereunto duly authorized.
CB COMMERCIAL REAL ESTATE SERVICES
GROUP, INC.
Date: November 4, 1997 By: /s/ Ronald J. Platisha
--------------------------------
Ronald J. Platisha
Executive Vice President
-3-
<PAGE>
EXHIBIT 99.1
[Logo of CB
NEWS Commercial]
- --------------------------------------------------------------------------------
FROM AMERICA'S LEADING COMMERCIAL REAL ESTATE SERVICES COMPANY
CB COMMERCIAL REAL ESTATE SERVICES GROUP, INC.
533 South Fremont Avenue
Los Angeles, CA 90071
(213) 613-3123
TRADED: NASDAQ:CBCG
AT THE COMPANY AT THE FINANCIAL RELATIONS BOARD
Cary Brazeman Karen Taylor Stephanie Mishra
Corporate Communications General Information Investor/Analyst Contact
(213) 613-3227 (310) 442-0599 (415) 986-1591
- --------------------------------------------------------------------------------
FOR IMMEDIATE RELEASE
NOVEMBER 3, 1997
CB COMMERCIAL ANNOUNCES KEY CORPORATE DEVELOPMENTS
ADDS 30 MILLION SQUARE FEET TO CORPORATE FACILITIES MANAGEMENT PORTFOLIO
COMPLETED JOINT VENTURE EXPANDS MARKET PRESENCE IN NEW ENGLAND
TRADING OF COMPANY SHARES SHIFTING TO NYSE
LOS ANGELES, CA, NOVEMBER 3, 1997-- CB Commercial Real Estate Services Group,
Inc. (NASDAQ:CBCG), the world's leading commercial real estate services
provider, today announced that the firm has added 30 million square feet of
corporate facilities to its management services portfolio. This includes new
and expanded assignments for clients such as Columbus, Ohio-based BANC ONE
CORPORATION and Benton Harbor, Michigan-based Whirlpool.
"With leading corporations increasingly focused on their core competencies,
the outsourcing of non-core activities, such as real estate services,
continues to offer CB Commercial significant opportunities for growth and
expansion," said Gary J. Beban, president of CB Commercial's Corporate
Services division. "We are pleased to be helping our clients enhance their
productivity, efficiency and bottom lines through best-of-class facilities
management and real estate process management practices."
In August CB Commercial merged with Koll Real Estate Services, a leader in
the corporate facilities management segment. The combined firm manages a
total facilities portfolio of 85 million square feet and a total property
portfolio of 200 million square feet for a range of corporate, institutional
and government clients.
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<PAGE>
JOINT VENTURE EXPANDS PRESENCE IN NEW ENGLAND REGION
CB Commercial also announced the completion of a joint venture that catapults
the company into a market-leading position in New England. The newly formed
entity, CB Commercial/Whittier Partners, LP ("CBC/Whittier"), is owned 50/50
by founders CB Commercial and Whittier Partners Group.
With principal offices in Boston, Massachusetts, and Hartford and New Haven,
Connecticut, CBC/Whittier provides a full range of commercial real estate
services, including corporate services, property sales, leasing, management
and appraisal services, throughout New England.
Commenting on the new joint venture and the company's overall growth plans,
CB Commercial Chairman and CEO James J. Didion said, "CB Commercial continues
to pursue a global growth strategy of mergers, acquisitions and strategic
investments to further enhance our ability to provide quality, vertically
integrated commercial real estate services across multiple geographic
markets. Corporate and institutional clients increasingly demand this kind of
service, and we're responding head-on."
CBC/Whittier further enhances the company's industry-leading market position
in terms of revenues, transaction volume, owned-and-operated offices and
employees.
CB COMMERCIAL MOVING STOCK LISTING TO NYSE
Beginning this Friday, November 7, CB Commercial stock will be traded on the
New York Stock Exchange, with a new ticker symbol, "CBG".
"The New York Stock Exchange is the oldest and most well-known equities
market in the country, and it's the best capitalized market in the world."
Didion said. "The exchange offers CB Commercial efficient access to capital,
the opportunity to significantly expand and diversify our shareholder base
and greater worldwide visibility. This is an exciting move for the company
as we continue to grow on all fronts."
The company's market capitalization has more than doubled since CB
Commercial, now traded on NASDAQ, went public in November 1996. The total
market capitalization of CB Commercial now exceeds $1 billion.
FORWARD-LOOKING STATEMENTS
This release may contain forward-looking statements as well as historical
information. Forward-looking statements, which are included in accordance
with the "safe harbor" provisions of the Private Securities Litigation Reform
Act of 1995, may involve known and unknown risks, uncertainties and other
factors that may cause the company's actual results and performance in future
periods to be materially different from any future results or performance
suggested by the forward-looking statements in this release. Such forward-
looking statements speak only as of the date of this release. The company
expressly disclaims any obligation to update or revise any forward-looking
statements found herein to reflect any changes in company expectations or
results or any change in events.
<PAGE>
Founded in 1906, CB Commercial is America's leading and largest commercial
real estate services firm and a global leader in business real estate
services. With 6,400 employees and through global strategic alliances, the
company serves real estate users, owners and investors in over 200 cities in
35 countries. Services include commercial property sales and leasing,
property management, corporate advisory and facilities management services,
mortgage banking, realty advisory and investment management, capital markets,
appraisal services, financial analysis, market research and human resources.
CB Commercial Real Estate Services Group, Inc. had 1996 revenues of $583
million.
***
For more information on CB Commercial (via facsimile and at no cost), simply
call 1-800-PRO-INFO and dial client code "CBCG." If you are calling from
outside the United States, please dial 908-544-2850.
# # #
<PAGE>
EXHIBIT 99.2
[LOGO OF CB
NEWS COMMERCIAL]
- --------------------------------------------------------------------------------
from America's Leading Commercial Real Estate Services Company
CB COMMERCIAL REAL ESTATE SERVICES GROUP, INC.
533 South Fremont Avenue
Los Angeles, CA 90071
(213) 613-3123
TRADED: NASDAQ:CBCG
AT THE COMPANY AT THE FINANCIAL RELATIONS BOARD
Cary Brazeman Karen Taylor Stephanie Mishra
Corporate Communications General Information Investor/Analyst Contact
(213) 613-3227 (310) 442-0599 (415) 986-1591
______________________________________________________________________________
FOR IMMEDIATE RELEASE
NOVEMBER 4, 1997
CB COMMERCIAL REPORTS 21% REVENUE GAINS, 23% INCREASE IN
EBITDA FOR THIRD QUARTER
. EPS ON AN ADJUSTED BASIS INCREASES 67% TO $.40
. REORGANIZES INTO THREE BUSINESS UNITS
LOS ANGELES, CA, NOVEMBER 4, 1997-- CB Commercial (NASDAQ:CBCG), the world's
leading commercial real estate services provider, today reported third quarter
consolidated revenue gains of 20.6%, along with 23.4% growth in earnings before
interest, income taxes, depreciation and amortization ("EBITDA") before one-time
charges. For the quarter, adjusted earnings per share increased 67.0% to $.40
per share, before one-time charges which primarily relate to the combination
with Koll Real Estate Services ("Koll").
CONSOLIDATED RESULTS
For the third quarter ended September 30, 1997, consolidated revenues increased
20.6% to $177.5 million versus $147.2 million a year ago. These gains include
approximately one month of Koll revenues. EBITDA increased 23.4% to $20.9
million before one-time charges compared with $16.9 million in 1996. Including
merger-related charges, the company reported a net loss applicable to common
shareholders of $2.9 million, or $.18 per share, versus net income applicable to
common shareholders of $43.8 million, or $3.11 per share, in the comparable
year-ago quarter. Earnings per common share, adjusted to exclude one-time
charges and the effect of a 1996 reduction in tax valuation allowances (which
artificially increased net income and earnings per share), increased 67.0% to
$.40 per share from $.24 per share in 1996.
-more-
In Exclusive Alliance with DTZ and C. Y. Leung [LOGO] Exceeding Client
Expectations Around the Globe
<PAGE>
CB Commercial News Release
November 4, 1997
Page 2
For the nine months ended September 30, 1997, consolidated revenues increased
20.1% to $469.5 million versus $390.9 million a year ago. These gains also
reflect one month of Koll revenues. EBITDA before one-time charges advanced
27.6% to $46.2 million, versus $36.2 million for the comparable nine month
period in 1996. Net income applicable to common shareholders was $2.2 million,
or $.15 per share, compared to $45.4 million, or $3.29 per share, in the prior
year period. Earnings per common share, adjusted to exclude one-time charges,
improved 119.4% to $.79 per share for the nine months ended September 30, 1997,
on a fully diluted basis.
Both the quarter and nine month adjusted results for 1996 exclude tax valuation
allowance adjustments. The company further noted that total one-time charges of
$16.0 million for 1997 included severance, facilities consolidation, accelerated
amortization and other costs occasioned by the Koll merger and concurrent
refinancing.
KOLL INTEGRATION LARGELY COMPLETE
Chairman and Chief Executive Officer James J. Didion said, "We are now operating
as one company, though in fact we began marketing our combined strengths even
before the transaction closed. For instance, we believe our enhanced
competitive position was instrumental in securing the award of more than 30
million square feet of new facilities management contracts over the past three
months." CB Commercial continues to expect annual run rate expense synergies of
more than $12 million from combining the companies, commencing in 1998.
MARKET FACTORS
A strong national economy and strengthening real estate markets helped propel
the company toward its third quarter financial performance. As an example, in
the office space sector, according to preliminary quarterly data from CB
Commercial/Torto Wheaton Research ("CBC/TWR"), the company's Boston-based real
estate econometric analysis and forecasting firm, demand for office space
continues to be high-- a result of positive job creation and generally favorable
economic activity-- and, because the growth of new space has been limited,
average rents are on the rise.
More specifically, according to CBC/TWR, more office space was absorbed in the
third quarter of 1997 than during any period since the third quarter of 1990.
This pushed suburban office vacancy rates on a national basis below 10 percent
for the first time since 1985, with downtown areas improving as well. In the
latest quarter, for example, the office vacancy rate in suburban Los Angeles
dropped by two full percentage points, from 17.9% to 15.9%.
THREE SEPARATE BUSINESSES
With the Koll integration, CB Commercial has restructured into three global
business units to best serve clients, as well as better reflect market
opportunities, and to encourage better investment community
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<PAGE>
CB Commercial News Release
November 4, 1997
Page 3
understanding of company prospects. The three units are brokerage services,
corporate and institutional management services, and financial services. For
the current quarter, the company will report business segment data in both the
new and old segment formats. Commencing with the fourth quarter, the company
will be reporting only on the new basis.
Didion said, "As we are the world's leading and most vertically integrated
commercial real estate services company, the sheer number of ways we participate
in commercial real estate sometimes makes it difficult for investors to
understand and track all but the largest of our growth opportunities. For
example, our corporate services and property management business, which is
already a market leader, represents a tremendous growth opportunity as the trend
of corporate America's outsourcing of non-core activities continues. Though it
accounts for just over a quarter of the size of our brokerage operation in
revenues, we are currently reinvesting the strong profits generated by the
brokerage business, in people and technology in Corporate Services, to realize
more quickly its growth potential. Similarly, we're investing in people and new
products in a number of financial services sectors, and are poised for continued
growth as market awareness of our capabilities increases. Our goal in the
restructuring is to increase focus on growth opportunities and to breakout more
clearly our progress in each area as the investments begin to pay off."
RELATIVE GAINS
During the quarter ended September 30, 1997, CB Commercial produced revenue
increases of 18.2% in Brokerage Services, which reached $102.8 million, 54.6% in
Corporate and Institutional Management Services, which reached $26.4 million,
and 12.0% in Financial Services, which reached $48.3 million. All benefited
from overall market trends and the competitive advantages generated by CB
Commercial's vertical integration, with each segment pursuing specific
strategies to increase its contribution to consolidated results for the year.
"Strategically," Didion said, "deal flow and cash flow from our brokerage
business are expected to provide meaningful revenue and profit growth, and it
will also provide a strong financial base, and market intelligence contribution
to support the financial services and corporate services businesses. As a
result, we are able to broadly benefit from not only the solid core, but also
the expanding new markets for commercial real estate services."
BROKERAGE SERVICES (58% OF REVENUES; GREW 18%)
Well-known as the company's core business, Brokerage Services (commercial
property sales and leasing) contributed 57.9% to consolidated revenues for the
quarter. The company reported 18.2% higher brokerage revenues versus the third
quarter of last year and 20.8% higher revenues for the nine months as lower
vacancy rates in most of the U.S. caused rents and sales prices to increase.
EBITDA increased 26.6% for the quarter and 50.7% for the nine months.
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<PAGE>
CB Commercial News Release
November 4, 1997
Page 4
CORPORATE AND INSTITUTIONAL MANAGEMENT SERVICES (15% OF REVENUES; GREW 55%)
Providing a combination of transaction management and advisory services,
property management and facilities management on a regional and national basis,
this division constitutes a "one-stop shop" for major corporate and
institutional clients. Compared to a year-ago, revenues from this unit increased
54.6%, due primarily to the Koll acquisition, to account for 14.9% of total
revenues. As one of the top three players in this segment, CB Commercial manages
approximately 300 million square feet and serves over 50 Fortune 500 clients as
well as hundreds of institutional investors through the two business units that
comprise this division: CB Commercial/Koll Management Services and CB
Commercial/Madison Advisory Group. EBITDA for the quarter advanced 173.2% to
$1.7 million, while segment EBITDA for the nine months was up 18.4% to $3.8
million.
Gary Beban, President of Corporate Services, noted, "While we are pleased with
the way our operations have come together, the full benefits of our integration
are not yet apparent financially. Specifically, our greatest area of
operational overlap was in property management, and we expect the merger to
generate a meaningful portion of the total expense synergies in this area. We
have been and are continuing to invest in our corporate services business, which
has been further pressuring our margins for the near-term, and anticipate these
investments will start to pay-off during 1998."
FINANCIAL SERVICES (27% OF REVENUES; GREW 12%)
CB Commercial's Financial Services division is a market leader in the delivery
of superior financial services and products to Wall Street, institutional,
corporate and offshore investors. Services include investment property sales,
mortgage banking through L.J. Melody & Company, valuation/appraisal, asset
management through Westmark Realty Advisors and real estate market research.
Products include hard-asset funds, loan funds, and mutual funds. Revenue from
the Financial Services segment contributed 27.2% to consolidated revenues and
increased 12.0% during the current quarter over the comparable prior year
period. EBITDA was up 4.4% for the quarter and flat year-to-date, reflecting
continued strength in investment property sales and valuation and appraisal
activity offset by expected declines in investment management and a more
competitive mortgage banking origination environment.
Ray Wirta, President of Financial Services, said, "In mortgage banking, we are
experiencing competitive pressures from an enormous influx of capital, which is
causing intense competition in the originations arena. In the investment
management area, we are experiencing greater competition in acquiring
properties, coupled with an anticipated run-off in our existing portfolio.
Notwithstanding these unexpected negatives in the markets, we anticipate better
results in both businesses as the new mortgage professionals mature, and the
intensity of the investment markets stabilize somewhat. Additionally, we look
forward to the expense synergies from combining the two investment advisory
businesses as well as the anticipated revenues we expect to realize from
investments we have been making in new financial services products."
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<PAGE>
CB Commercial News Release
November 4, 1997
Page 5
FORWARD-LOOKING STATEMENTS
This release may contain forward-looking statements as well as historical
information. Forward looking statements, which are included in accordance with
the "safe harbor" provisions of the Private Securities Litigation Reform Act of
1995, may involve known and unknown risks, uncertainties and other factors that
may cause the company's actual results and performance in future periods to be
materially different from any future results or performance suggested by the
forward-looking statements in this release. Such forward-looking statements
speak only as of the date of this release. The company expressly disclaims any
obligation to update or revise any forward-looking statements found herein to
reflect any changes in company expectations or results or any change in events.
Founded in 1906, CB Commercial is America's leading and largest commercial real
estate services firm and a global leader in business real estate services. With
6,400 employees and through global strategic alliances, the company serves real
estate users, owners and investors in over 200 cities in 35 countries. Services
include commercial property sales and leasing, property management, corporate
advisory and facilities management services, mortgage banking, realty advisory
and investment management, capital markets, appraisal services, financial
analysis, market research and human resources. CB Commercial Real Estate
Services Group, Inc. had 1996 revenues of $583 million.
***
For more information on CB Commercial (via facsimile and at no cost), simply
call 1-800-PRO-INFO and dial client code "CBCG." If you are calling from outside
the United States, please dial 908-544-2850.
-more-
<PAGE>
CB Commercial News Release
November 4, 1997
Page 6
CB COMMERCIAL REAL ESTATE SERVICES GROUP, INC.
OPERATING RESULTS
FOR THE THREE MONTHS ENDED SEPTEMBER 30, 1997 WITH
COMPARATIVE FIGURES FOR THE SIMILAR PERIODS IN 1996
<TABLE>
<CAPTION>
QUARTER ENDED SEPTEMBER 30,
---------------------------------------------------------
1997 1996 DIFFERENCE % CHANGE
-------- -------- ---------- --------
<S> <C> <C> <C> <C>
CONSOLIDATED
- ------------
Revenue $ 177,520 $ 147,168 $ 30,352 20.6%
Costs and expenses:
Commissions, fees and other incentives 87,825 74,196 13,629 18.4%
Operating, administrative and other 68,809 56,042 12,767 22.8%
Merger related and other non-recurring charges 12,924 0 12,924 n/a
Depreciation and amortization 6,098 3,431 2,667 77.7%
----------- ----------- ---------- -----
Operating income 1,864 13,499 (11,635) -86.2%
Interest income 740 286 454 158.7%
Interest expense 4,158 6,196 (2,038) -32.9%
----------- ----------- ---------- -----
Income (loss) before provision (benefit) for
income tax and extraordinary items (1,554) 7,589 (9,143) n/a
Provision (benefit) for income tax (569) 4,220 (4,789) n/a
Reduction of valuation allowances 0 (40,400) 40,400 n/a
----------- ----------- ---------- -----
Net provision (benefit) for income tax (569) (36,180) 35,611 n/a
----------- ----------- ---------- -----
Net income (loss) before extraordinary items (985) 43,769 (44,754) n/a
Extraordinary items 951 0 951 n/a
----------- ----------- ---------- -----
Net income (loss) $ (1,936) $ 43,769 $ (45,705) n/a
=========== =========== ========== =====
Net income (loss) applicable to common shareholders $ (2,936) $ 43,769 $ (46,705) n/a
=========== =========== ========== =====
Primary earnings (loss) per share $ (0.18) $ 3.11 $ (3.29) n/a
=========== =========== ========== =====
Number of shares used in computing primary
earnings (loss) per share 16,231,033 14,060,957 2,170,076 15.4%
=========== =========== ========== =====
Fully diluted earnings (loss) per share $ (0.18) $ 3.11 $ (3.29) n/a
=========== =========== ========== =====
Number of shares used in computing fully diluted
earnings (loss) per share 16,244,001 14,060,957 2,183,044 15.5%
=========== =========== ========== =====
EBITDA excluding merger related and other non-
recurring charges $ 20,886 $ 16,930 $ 3,956 23.4%
=========== =========== ========== =====
</TABLE>
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<PAGE>
CB Commercial News Release
November 4, 1997
Page 7
CB COMMERCIAL REAL ESTATE SERVICES GROUP, INC.
OPERATING RESULTS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1997 WITH
COMPARATIVE FIGURES FOR THE SIMILAR PERIODS IN 1996
<TABLE>
<CAPTION>
NINE MONTHS ENDED SEPTEMBER 30,
-----------------------------------------------------------
1997 1996 DIFFERENCE % CHANGE
----------- ------------ ---------- --------
<S> <C> <C> <C> <C>
CONSOLIDATED
- ------------
Revenue $ 469,542 $ 390,863 $ 78,679 20.1%
Costs and expenses:
Commissions, fees and other incentives 237,953 195,465 42,488 21.7%
Operating, administrative and other 185,405 159,196 26,209 16.5%
Merger related and other non-recurring
charges 12,924 0 12,924 n/a
Depreciation and amortization 12,272 9,749 2,523 25.9%
----------- ----------- -------- ------
Operating income 20,988 26,453 (5,465) -20.7%
Interest income 1,959 1,035 924 89.3%
Interest expense 12,007 17,883 (5,876) -32.9%
----------- ----------- -------- ------
Income (loss) before provision (benefit) for
income tax and extraordinary items 10,940 9,605 1,335 13.9%
Provision (benefit) for income tax 4,786 4,610 176 3.8%
Reduction of valuation allowances 0 (40,400) 40,400 n/a
----------- ----------- -------- ------
Net provision (benefit) for income tax 4,786 (35,790) 40,576 n/a
----------- ----------- -------- ------
Net income (loss) before extraordinary items 6,154 45,395 (39,241) -86.4%
Extraordinary items 951 0 951 n/a
----------- ----------- -------- ------
Net income (loss) $ 5,203 $ 45,395 $(40,192) -88.5%
=========== =========== ======== ======
Net income (loss) applicable to common
shareholders $ 2,203 $ 45,395 $(43,192) -95.1%
=========== =========== ======== ======
Primary earnings (loss) per share $ 0.15 $ 3.29 $ (3.14) -95.4%
=========== =========== ======== ======
Number of shares used in computing primary
earnings (loss) per share 14,663,028 13,815,434 847,594 6.1%
=========== =========== ======== ======
Fully diluted earnings (loss) per share $ 0.15 $ 3.29 $ (3.14) -95.4%
=========== =========== ======== ======
Number of shares used in computing fully
diluted earnings (loss) per share 14,753,539 13,815,434 938,105 6.8%
=========== =========== ======== ======
EBITDA excluding merger related
and other non-recurring charges $ 46,184 $ 36,202 $ 9,982 27.6%
=========== =========== ======== ======
</TABLE>
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<PAGE>
CB Commercial News Release
November 4, 1997
Page 8
CB COMMERCIAL REAL ESTATE SERVICES GROUP, INC.
CONDENSED CONSOLIDATED BALANCE SHEET
(DOLLARS IN THOUSANDS)
<TABLE>
<CAPTION>
SEPTEMBER 30, DECEMBER 31,
1997 1996
------------- ------------
(UNAUDITED)
<S> <C> <C>
ASSETS
Cash and cash equivalents $ 43,623 $ 49,328
Other current assets 97,088 63,593
Property and equipment, net 43,098 37,064
Goodwill and other intangible assets, net 246,735 75,883
Other assets, net 67,277 52,045
--------- ---------
Total assets $ 497,821 $ 277,913
========= =========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current maturities of long-term debt $ 9,135 $ 15,314
Other current liabilities 122,169 89,660
Long-term debt, less current maturities 182,286 148,529
Other long-term liabilities 33,426 25,830
--------- ---------
Total liabilities $ 347,016 $ 279,333
MINORITY INTEREST 12,390 95
STOCKHOLDERS' EQUITY
Contributed capital $ 328,026 $ 193,090
Accumulated deficit (189,611) (194,605)
--------- ---------
Total stockholders' equity 138,415 (1,515)
--------- ---------
Total liabilities and stockholders' equity $ 497,821 $ 277,913
========= =========
</TABLE>
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<PAGE>
CB Commercial News Release
November 4, 1997
Page 9
CB COMMERCIAL REAL ESTATE SERVICES GROUP, INC.
OPERATING RESULTS BY BUSINESS SEGMENT
FOR THE THREE MONTHS ENDED SEPTEMBER 30, 1997 WITH COMPARATIVE
FIGURES FOR THE SIMILAR PERIODS IN 1996
-------------------------------------
NEW SEGMENT FORMAT
-------------------------------------
<TABLE>
<CAPTION>
QUARTER ENDED SEPTEMBER 30,
------------------------------------------------------
1997 1996 DIFFERENCE % CHANGE
---------- ---------- ---------- --------
<S> <C> <C> <C> <C>
BROKERAGE SERVICES
- ------------------
Revenue $102,760 $86,911 $15,849 18.2%
Costs and expenses:
Commissions, fees and other incentives 57,280 47,969 9,311 19.4%
Operating, administrative and other 33,228 29,264 3,964 13.5%
Depreciation and amortization 3,636 1,834 1,802 98.3%
-------- ------- ------- -----
Operating income $ 8,616 $ 7,844 $ 772 9.8%
======== ======= ======= =====
CORPORATE & INSTITUTIONAL MANAGEMENT SERVICES
- ---------------------------------------------
Revenue $ 26,433 $17,094 $ 9,339 54.6%
Costs and expenses:
Commissions, fees and other incentives 9,878 7,766 2,112 27.2%
Operating, administrative and other 14,834 8,698 6,136 70.5%
Depreciation and amortization 850 217 633 291.7%
-------- ------- ------- -----
Operating income $ 871 $ 413 $ 458 110.9%
======== ======= ======= =====
FINANCIAL SERVICES
- ------------------
Revenue $ 48,327 $43,163 $ 5,164 12.0%
Costs and expenses:
Commissions, fees and other incentives 20,667 18,461 2,206 11.9%
Operating, administrative and other 20,747 18,080 2,667 14.8%
Depreciation and amortization 1,612 1,380 232 16.8%
-------- ------- ------- -----
Operating income $ 5,301 $ 5,242 $ 59 1.1%
======== ======= ======= =====
MERGER RELATED AND OTHER NON-RECURRING COSTS $ 12,924 $ 0 $12,924 n/a
- -------------------------------------------- ======== ======= ======= =====
</TABLE>
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<PAGE>
CB Commercial News Release
November 4, 1997
Page 10
CB COMMERCIAL REAL ESTATE SERVICES GROUP, INC.
OPERATING RESULTS BY BUSINESS SEGMENT
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1997 WITH COMPARATIVE
FIGURES FOR THE SIMILAR PERIODS IN 1996
-------------------------------------
NEW SEGMENT FORMAT
-------------------------------------
<TABLE>
<CAPTION>
NINE MONTHS ENDED SEPTEMBER 30,
------------------------------------------------------
1997 1996 DIFFERENCE % CHANGE
---------- ---------- ---------- --------
<S> <C> <C> <C> <C>
BROKERAGE SERVICES
- ------------------
Revenue $282,126 $233,490 $48,636 20.8%
Costs and expenses:
Commissions, fees and other incentives 157,977 130,076 27,901 21.4%
Operating, administrative and other 96,174 84,856 11,318 13.3%
Depreciation and amortization 6,560 5,512 1,048 19.0%
-------- -------- ------- -----
Operating income $ 21,415 $ 13,046 $ 8,369 64.1%
======== ======== ======= =====
CORPORATE & INSTITUTIONAL MANAGEMENT SERVICES
- ---------------------------------------------
Revenue $ 60,571 $ 47,015 $13,556 28.8%
Costs and expenses:
Commissions, fees and other incentives 25,873 20,713 5,160 24.9%
Operating, administrative and other 30,878 23,075 7,803 33.8%
Depreciation and amortization 1,292 684 608 88.9%
-------- -------- ------- -----
Operating income $ 2,528 $ 2,543 $ (15) -0.6%
======== ======== ======= =====
FINANCIAL SERVICES
- ------------------
Revenue $126,845 $110,358 $16,487 14.9%
Costs and expenses:
Commissions, fees and other incentives 54,103 44,676 9,427 21.1%
Operating, administrative and other 58,353 51,265 7,088 13.8%
Depreciation and amortization 4,420 3,553 867 24.4%
-------- -------- ------- -----
Operating income $ 9,969 $ 10,864 $ (895) -8.2%
======== ======== ======= =====
MERGER RELATED AND OTHER NON-RECURRING COSTS $ 12,924 $ 0 $12,924 n/a
- -------------------------------------------- ======== ======== ======= =====
</TABLE>
-more-
<PAGE>
CB Commercial News Release
November 4, 1997
Page 11
CB COMMERCIAL REAL ESTATE SERVICES GROUP, INC.
OPERATING RESULTS BY BUSINESS SEGMENT
FOR THE THREE MONTHS ENDED SEPTEMBER 30, 1997 WITH COMPARATIVE
FIGURES FOR THE SIMILAR PERIODS IN 1996
-------------------------------------
OLD SEGMENT FORMAT
-------------------------------------
<TABLE>
<CAPTION>
QUARTER ENDED SEPTEMBER 30,
1997 1996 DIFFERENCE % CHANGE
---------- ---------- ---------- --------
<S> <C> <C> <C> <C>
PROPERTY & USER SERVICES
- ------------------------
Revenue:
Brokerage $102,772 $ 82,768 $20,004 24.2%
Investment properties 34,281 33,105 1,176 3.6%
Corporate services/Facilities management 9,811 8,032 1,779 22.1%
Property management 7,713 5,040 2,673 53.0%
Other 2,345 518 1,827 352.7%
-------- -------- ------- ------
156,922 129,463 27,459 21.2%
Costs and expenses:
Commissions, fees and other incentives 82,325 69,293 13,032 18.8%
Operating, administrative and other 57,155 46,333 10,822 23.4%
Depreciation and amortization 4,640 2,309 2,331 101.0%
-------- -------- ------- ------
Operating income $ 12,802 $ 11,528 $ 1,274 11.1%
======== ======== ======= ======
INVESTOR SERVICES
- -----------------
MORTGAGE BANKING
Revenue $ 6,577 $ 6,790 $ (213) -3.1%
Costs and expenses:
Commissions, fees and other incentives 2,627 2,772 (145) -5.2%
Operating, administrative and other 3,107 3,191 (84) -2.6%
Depreciation and amortization 354 254 100 39.4%
-------- -------- ------- ------
Operating income $ 489 $ 573 $ (84) -14.7%
======== ======== ======= ======
</TABLE>
-more-
<PAGE>
CB Commercial News Release
November 4, 1997
Page 12
CB COMMERCIAL REAL ESTATE SERVICES GROUP, INC.
OPERATING RESULTS BY BUSINESS SEGMENT
FOR THE THREE MONTHS ENDED SEPTEMBER 30, 1997 WITH COMPARATIVE
FIGURES FOR THE SIMILAR PERIODS IN 1996
-------------------------------------
OLD SEGMENT FORMAT
-------------------------------------
<TABLE>
<CAPTION>
QUARTER ENDED SEPTEMBER 30,
------------------------------------------------------
1997 1996 DIFFERENCE % CHANGE
---------- ---------- ---------- --------
<S> <C> <C> <C> <C>
INVESTOR SERVICES (CONTINUED)
- -----------------------------
INVESTMENT MANAGEMENT AND ADVISORY
Revenue $ 7,592 $ 6,238 1,354 21.7%
Costs and expenses:
Commissions, fees and other incentives 26 0 26 n/a
Operating, administrative and other 6,182 4,719 1,463 31.0%
Depreciation and amortization 1,073 832 241 29.0%
------- ------- ------- -----
Operating income $ 311 $ 687 $ (376) -54.7%
======= ======= ======= =====
VALUATION & APPRAISAL SERVICES
Revenue $ 6,429 $ 4,677 $ 1,752 37.5%
Costs and expenses:
Commissions, fees and other incentives 2,847 2,131 716 33.6%
Operating, administrative and other 2,365 1,799 566 31.5%
Depreciation and amortization 31 36 (5) -13.9%
------- ------- ------- -----
Operating income $ 1,186 $ 711 $ 475 66.8%
======= ======= ======= =====
TOTAL INVESTOR SERVICES
- -----------------------
Revenue $20,598 $17,705 $ 2,893 16.3%
Costs and expenses:
Commissions, fees and other incentives 5,500 4,903 597 12.2%
Operating, administrative and other 11,654 9,709 1,945 20.0%
Depreciation and amortization 1,458 1,122 336 29.9%
------- ------- ------- -----
Operating income $ 1,986 $ 1,971 $ 15 0.8%
======= ======= ======= =====
MERGER RELATED & OTHER NON-RECURRING COSTS $12,924 $ 0 $12,924 n/a
- ------------------------------------------ ======= ======= ======= =====
</TABLE>
-more-
<PAGE>
CB Commercial News Release
November 4, 1997
Page 13
CB COMMERCIAL REAL ESTATE SERVICES GROUP, INC.
OPERATING RESULTS BY BUSINESS SEGMENT
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1997 WITH COMPARATIVE
FIGURES FOR THE SIMILAR PERIODS IN 1996
-------------------------------------
OLD SEGMENT FORMAT
-------------------------------------
<TABLE>
<CAPTION>
NINE MONTHS ENDED SEPTEMBER 30,
------------------------------------------------------
1997 1996 DIFFERENCE % CHANGE
---------- ---------- ---------- --------
<S> <C> <C> <C> <C>
PROPERTY & USER SERVICES
- ------------------------
Revenue:
Brokerage $274,940 $227,756 $47,184 20.7%
Investment properties 95,605 80,406 15,199 18.9%
Corporate services/Facilities management 22,589 17,436 5,153 29.6%
Property management 17,361 14,705 2,656 18.1%
Other 3,174 1,198 1,976 164.9%
-------- -------- ------- -----
413,669 341,501 72,168 21.1%
Costs and expenses:
Commissions, fees and other incentives 222,842 183,731 39,111 21.3%
Operating, administrative and other 153,115 130,764 22,351 17.1%
Depreciation and amortization 8,658 7,050 1,608 22.8%
-------- -------- ------- -----
Operating income $ 29,054 $ 19,956 $ 9,098 45.6%
======== ======== ======= =====
INVESTOR SERVICES
- -----------------
MORTGAGE BANKING
Revenue $ 17,934 $ 14,035 $ 3,899 27.8%
Costs and expenses:
Commissions, fees and other incentives 7,811 5,611 2,200 39.2%
Operating, administrative and other 8,687 6,409 2,278 35.5%
Depreciation and amortization 1,053 386 667 172.8%
-------- -------- ------- -----
Operating income $ 383 $ 1,629 $(1,246) -76.5%
======== ======== ======= =====
</TABLE>
-more-
<PAGE>
CB Commercial News Release
November 4, 1997
Page 14
CB COMMERCIAL REAL ESTATE SERVICES GROUP, INC.
OPERATING RESULTS BY BUSINESS SEGMENT
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1997 WITH COMPARATIVE
FIGURES FOR THE SIMILAR PERIODS IN 1996
-------------------------------------
OLD SEGMENT FORMAT
-------------------------------------
<TABLE>
<CAPTION>
NINE MONTHS ENDED SEPTEMBER 30,
------------------------------------------------------
1997 1996 DIFFERENCE % CHANGE
---------- ---------- ---------- --------
<S> <C> <C> <C> <C>
INVESTOR SERVICES (CONTINUED)
- -----------------------------
INVESTMENT MANAGEMENT AND ADVISORY
Revenue $21,970 $22,239 $ (269) -1.2%
Costs and expenses:
Commissions, fees and other incentives 26 0 26 100%
Operating, administrative and other 17,053 16,351 702 4.3%
Depreciation and amortization 2,462 2,207 255 11.6%
------- ------- ------- -----
Operating income $ 2,429 $ 3,681 $(1,252) -34.0%
======= ======= ======= =====
VALUATION & APPRAISAL SERVICES
Revenue $15,969 $13,088 $ 2,881 22.0%
Costs and expenses:
Commissions, fees and other incentives 7,274 6,123 1,151 18.8%
Operating, administrative and other 6,550 5,672 878 15.5%
Depreciation and amortization 99 106 (7) -6.6%
------- ------- ------- -----
Operating income $ 2,046 $ 1,187 $ 859 72.4%
======= ======= ======= =====
TOTAL INVESTOR SERVICES
- -----------------------
Revenue $55,873 $49,362 $ 6,511 13.2%
Costs and expenses:
Commissions, fees and other incentives 15,111 11,734 3,377 28.8%
Operating, administrative and other 32,290 28,432 3,858 13.6%
Depreciation and amortization 3,614 2,699 915 33.9%
------- ------- ------- -----
Operating income $ 4,858 $ 6,497 $(1,639) -25.2%
======= ======= ======= =====
MERGER RELATED & OTHER NON-RECURRING COSTS $12,924 $ 0 $12,924 n/a
- ------------------------------------------ ======= ======= ======= =====
</TABLE>
# # #
