CBRE Group (CBRE) Q1 2023 Earnings Call Transcript

CBRE Group (NYSE:CBRE) Q1 2023 Earnings Conference Call April 26, 2023 8:30 AM ET

Company Participants

Brad Burke - SVP, IR

Bob Sulentic - President, CEO

Emma Giamartino - CFO

Conference Call Participants

Chandni Luthra - Goldman Sachs

Steve Sakwa - Evercore ISI

Anthony Paolone - JPMorgan

Jade Rahmani - KBW

Michael Griffin - Citi

Stephen Sheldon - William Blair

Patrick O'Shaughnessy - Raymond James

Operator

Greetings, and welcome to CBRE's First Quarter 2023 Earnings Conference Call. At this time, all participants are in a listen-only mode. A brief question-and-answer session will follow formal presentation. [Operator Instructions] As a reminder, this conference is being recorded.

It is now my pleasure to introduce your host, Brad Burke, Senior Vice President of Investor Relations and Strategic Finance. Thank you, Brad. You may begin.

Brad Burke

Good morning, everyone, and welcome to CBRE's first quarter 2023 earnings conference call. Earlier today, we posted a presentation deck on our website that you can use all along with our prepared remarks and an Excel file that contains additional supplemental materials.

Before we kick off today's call, I'll remind you that today's presentation contains forward-looking statements, including, without limitation, statements concerning our earnings outlook. Forward-looking statements are predictions, projections or other statements about future events. These statements involve risks and uncertainties that may cause actual results and trends to differ materially from those projected. For a full discussion of the risks and other factors that may impact these forward-looking statements, please refer to this morning's earnings release and our SEC filings.

We have provided reconciliations of the non-GAAP financial measures discussed on our call to the most directly comparable GAAP measures, together with explanations of these measures in our presentation deck appendix.

I'm joined on today's call by Bob Sulentic, our President and CEO; and Emma Giamartino, our Chief Financial Officer.

Now please turn to Slide 5 as I turn the call over to Bob.

Bob Sulentic

Thank you, Brad, and good morning, everyone. Our first quarter results were slightly better than we expected going into the year, but still down significantly from last year's strong first quarter. Our performance relative to our expectations was led by the cyclically resilient elements of our business and our cost management efforts, which more than offset a greater-than-expected decline in property sales.

The elements of our business that are cyclically resilient include our entire GWS business, loan servicing, property management, valuations and asset management fees from our investment management business. Combined, these businesses saw revenue increase nearly 10% during the first quarter and are expected to account for more than 50% of our business segment operating profit for the year, a record high.