Jones Lang LaSalle(JLL) - 2023 Q3 - Quarterly Report

Revenue Performance - For the three months ended September 30, 2023, total revenue was $992.4 million, a decrease of 10.7% compared to $1,111.5 million in the same period of 2022[34]. - Revenue for Q3 2023 was $5,111.4 million, a decrease of 1% compared to $5,177.5 million in Q3 2022[134]. - Fee revenue for Q3 2023 was $1,791.4 million, down 13% from $2,048.6 million in Q3 2022[134]. - For the nine months ended September 30, 2023, total revenue was $14,879.4 million, down 2% from $15,257.3 million in the same period of 2022[135]. - Revenue for the nine months ended September 30, 2023, decreased to $2,924.2 million, down 9% from $3,229.2 million in 2022[168]. - Work Dynamics revenue increased by 7% to $3,514.2 million in Q3 2023 compared to $3,289.8 million in Q3 2022[134]. - Capital Markets revenue fell by 27% to $435.8 million in Q3 2023 from $595.2 million in Q3 2022[134]. - Property Management achieved revenue growth due to portfolio expansion in the Americas and increased fees from interest-rate sensitive contracts in the U.K.[168]. Adjusted EBITDA and Operating Income - Adjusted EBITDA for the consolidated entity was $205.2 million in Q3 2023, down 25.7% from $276.2 million in Q3 2022[36]. - Adjusted EBITDA for Q3 2023 was $205.2 million, a decrease of 26% compared to $276.2 million in Q3 2022[160]. - Operating income decreased by 41% to $119.1 million in Q3 2023 from $202.6 million in Q3 2022[134]. - Adjusted EBITDA margin (local currency basis) decreased to 8.3% in the nine months ended September 30, 2023, from 14.9% in the same period of 2022[135]. - Adjusted EBITDA for the nine months ended September 30, 2023, was $256.1 million, representing a 32% decrease from $377.3 million in 2022[168]. Expenses and Charges - Total operating expenses for Q3 2023 were $4,992.3 million, slightly up by 1% from $4,974.9 million in Q3 2022[134]. - Restructuring and acquisition charges totaled $31.6 million for the three months ended September 30, 2023, compared to $21.0 million in the same period of 2022, representing a 50.7% increase[114]. - Severance and other employment-related charges amounted to $16.4 million for the three months ended September 30, 2023, up from $9.4 million in the prior year, indicating a 74.5% increase[114]. - The total restructuring and acquisition charges for the nine months ended September 30, 2023, were $79.1 million, compared to $66.4 million for the same period in 2022, reflecting an increase of 19.5%[114]. Financial Position and Assets - As of September 30, 2023, contract assets were $425.2 million, a decrease from $444.7 million as of December 31, 2022[26]. - The company’s total contract liabilities decreased to $134.0 million as of September 30, 2023, from $151.4 million as of December 31, 2022[26]. - Goodwill as of September 30, 2023, totaled $4,541.8 million, with identifiable intangibles of $803.2 million and $47.8 million of identifiable intangibles with indefinite useful lives[45]. - Total investments as of September 30, 2023, were $865.2 million, a decrease from $873.8 million as of December 31, 2022[55]. - The balance of identifiable intangibles increased to $1,335.6 million as of September 30, 2023, from $1,304.3 million as of December 31, 2022[49]. Debt and Financing - As of September 30, 2023, total debt increased to $2,078.5 million from $1,750.8 million as of December 31, 2022, reflecting a significant rise in borrowing[97]. - The average outstanding borrowings for the three months ended September 30, 2023, were $2,011.9 million, compared to $1,599.8 million for the same period in 2022, indicating a 25.8% increase[101]. - The average effective interest rate for the nine months ended September 30, 2023, was 5.8%, up from 2.2% in the same period of 2022, showing a substantial rise in borrowing costs[101]. - The company has a $3.35 billion unsecured revolving credit facility maturing on April 14, 2026, with pricing as of September 30, 2023, at Adjusted Term SOFR plus 0.98%[98]. Market and Economic Conditions - The company anticipates that macroeconomic conditions will continue to significantly impact its results of operations[124]. - Transaction-based revenue variability is influenced by the size and timing of clients' transactions, affecting overall revenue consistency[131]. - The company has noted that its quarterly revenue and profits typically increase as the year progresses due to seasonal trends in the real estate industry[132]. - A significant portion of the company's compensation and benefits expense is derived from incentive compensation plans, leading to fluctuations in quarterly expenses[133].