Colliers International - CEO, Jay Hennick
CEO, Jay Hennick
Source: Globe Street
  • Investment firm, Colliers International Group Inc (TSX:CIGI) has reported a resilient first quarter but still expects a significant hit to its full-year earnings
  • The company has estimated a 15 to 25 per cent reduction in consolidated revenue in 2020, and a 25 to 35 per cent reduction in the full-year’s adjusted EBITDA, due to the COVID-19 pandemic
  • The majority of the impact is expected to hit the brokerage arm of its business, which makes up 55 per cent of its revenue, based on COVID-19’s impact on its China operations earlier this year
  • However, in company’s first quarterly report, revenue remained largely flat compared to 2019’s same quarter, at approximately C$879.83 million
  • Before the market opens, Colliers International Group Inc (CIGI) is trading at $74.97 a share, with a market cap of $2.89 billion

Investment firm Colliers International Group Inc (TSX:CIGI) has reported a robust first quarter but still expects a significant hit to its full-year earnings.

In its first quarter results, released today, the company has estimated a 15 to 25 per cent reduction in consolidated full-year revenue, due to the impact of COVID-19 on its operations. Colliers expects this to translate to a 25 to 35 per cent reduction in the full-year’s adjusted EBITDA.

The majority of the impact is expected to hit the company’s brokerage arm, which makes up 55 per cent of its revenue. The other 45 per cent is from its outsourcing, advisory and investment management, sectors which are expected to remain largely unaffected.

Colliers has made these predictions based on the performance of the Asian arms of it’s business, which were hit earlier by the pandemic but are now showing signs of recovery

With all that said, the company has reported a relatively strong first quarter, with most financial markers remaining flat or improving.

Revenue remained largely unmoved compared to 2019’s same quarter, at approximately C$879.83 million. This is down just 1 per cent, which is largely attributable to foreign exchanges, rather than the recent economic downturn.

EBITDA was up 25 per cent to approximately $76.04 million. This resulted in an operated earnings of approximately $25.81 million, which is up around 38 per cent on the previous year.

The company stated that the majority of the COVID-19’s impact on its business was pushed towards the end of the quarter.

Jay S. Hennick, Global Chairman and CEO of Colliers believes the first quarter shows the company’s resilience, especially given the wide impact of the pandemic.

“Given the uncertainty, we expect the balance of the year to be challenging, particularly for our Brokerage business. 

“Fortunately, Colliers benefits from its globally diverse revenue streams, with about 55 per cent of revenues coming from the Americas and the balance split between EMEA and Asia Pacific. As markets return to normal, those that recover first will generate increasing revenues sooner as we are already seeing in China and in other parts of Asia,” he said.

Jay went on to say that the company’s diversified business model and strong balance sheet will help it weather the coming months and emerge well-positioned for future growth.

Before the market opens, Colliers International Group Inc (CIGI) is trading at $74.97 a share, with a market cap of $2.89 billion

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