Global property advisor CBRE has cut its profit guidance by 3-5% to $2.15-2.30 a share for the year 2016 as a result of the expected impact of Brexit on UK property transaction volumes.
'We are adjusting our outlook for the remainder of the year. This is due principally to the impact of Brexit on UK property transaction volumes, and less visibility around the timing of the realization of certain incentives in our global investment management and development services businesses,' said Bob Sulentic, the company’s president and chief executive officer.
The new profit guidance however represents solid growth of approximately 9% at the mid-point of the range.
The company reported a 34% rise in revenue to $3.2 bn in the second quarter of the year, while its earnings per diluted share decreased to $0.36. In EMEA (Europe, the Middle East & Africa), revenue rose by 64% in the same period, or 3% on a like-for-like basis, without the contributions from the Global Workplace Solutions business, which CBRE acquired in September 2015.
Global property sales revenue fell 6% in Q2, particularly in EMEA (17% decline) and the Asia Pacific region (18%) while the Americas reported a modest growth of 1%.
This compared with a robust second quarter in 2015, when year-on-year growth rates were 23% in the Americas; 37% in EMEA and 8% in Asia.
A high degree of uncertainty affected the UK real estate market, as shown by a nearly 40% drop in the UK market-wide property sales volumes, according to CBRE Research. The effect on CBRE’s UK revenue during the second quarter was materially less pronounced.
