Latest news with #NeilJohnston
Yahoo
13-05-2025
- Business
- Yahoo
CWK Q1 Earnings Call: Cushman & Wakefield Outpaces Expectations with Broad-Based Growth, Cautious on Macro
Real estate services firm Cushman & Wakefield (NYSE:CWK) reported Q1 CY2025 results beating Wall Street's revenue expectations , with sales up 4.6% year on year to $2.28 billion. Its non-GAAP profit of $0.09 per share was significantly above analysts' consensus estimates. Is now the time to buy CWK? Find out in our full research report (it's free). Revenue: $2.28 billion vs analyst estimates of $2.23 billion (4.6% year-on-year growth, 2.5% beat) Adjusted EPS: $0.09 vs analyst estimates of $0.02 (significant beat) Adjusted EBITDA: $96.2 million vs analyst estimates of $83.78 million (4.2% margin, 14.8% beat) Operating Margin: 2%, up from 0.9% in the same quarter last year Free Cash Flow was -$166.6 million compared to -$138.4 million in the same quarter last year Market Capitalization: $2.54 billion Cushman & Wakefield's Q1 results reflected broad-based growth across its service lines, with management emphasizing momentum in both leasing and capital markets activity. CEO Michelle MacKay credited a simplified organizational structure and strategic investments made over the past 18 months for driving operational agility and sustained client demand, noting, 'We are now attacking growth, and we are delivering results ahead of schedule.' Stronger-than-anticipated performance was seen across the Americas and Asia-Pacific, while Europe, the Middle East, and Africa (EMEA) faced macroeconomic headwinds. Looking ahead, management's guidance remains steady, although they acknowledged heightened economic uncertainty could affect the pace of recovery. CFO Neil Johnston reaffirmed full-year revenue targets but flagged a wider range of potential economic outcomes, stating, 'We will remain flexible and watchful at the operating environment and make any necessary adjustments.' The company's approach is to balance continued investment in talent and technology with ongoing debt reduction as it seeks to capitalize on what it sees as the early stages of a multi-year commercial real estate recovery. Cushman & Wakefield's management attributed Q1's outperformance to a combination of internal operational improvements and recovering client demand, particularly in leasing and capital markets. They highlighted specific initiatives and end-market trends affecting each region and service line. Leasing and Capital Markets Growth: The Americas showed double-digit growth in both leasing and capital markets. Leasing activity was buoyed by return-to-office trends and stable demand for quality office and industrial space, while capital markets benefited from robust activity in Japan and the UK. Service Line Diversification: The company's global occupier services and facilities management businesses achieved mid-single-digit organic growth, supported by new contract wins and strong client retention, especially in Asia-Pacific. Talent Acquisition and Retention: Management reported accelerated hiring of high-performing teams in capital markets and leasing, with more new brokers onboarded in the Americas year-to-date than in all of last year, aiming to further solidify market share. EMEA Headwinds and Green Shoots: EMEA performance lagged due to macroeconomic weakness and the unwind of project management work. However, property management in the region grew and UK capital markets showed signs of recovery after interest rate cuts. Balanced Capital Allocation: The company continued to reduce debt, paying down $25 million this quarter, and refinanced a portion of its term loan at a lower rate, while maintaining investment in growth initiatives. Management's outlook is anchored by expectations of continued steady growth in leasing, capital markets, and services, but tempered by macroeconomic volatility and region-specific risks. Demand for Quality Space: Return-to-office mandates and evolving workplace strategies are expected to support ongoing demand for office and industrial leasing, with longer average lease terms pointing to increased client confidence. Market-Specific Recovery Pace: The Americas and Asia-Pacific are forecast to lead growth, while EMEA's recovery may be gradual due to persistent economic challenges and slower project management activity. Investment and Capital Discipline: The company plans to accelerate investments in talent and technology to drive long-term growth, while maintaining a focus on deleveraging and prudent capital allocation to navigate uncertain market conditions. Ronald Kamdem (Morgan Stanley): Asked about drivers of the 100 basis point margin improvement; management pointed to stronger-than-expected leasing and services revenue, with some benefit from expense timing. Ronald Kamdem (Morgan Stanley): Queried about the potential impact of tariffs and macro uncertainty on leasing and capital markets; CEO Michelle MacKay stated that less than 5% of clients are delaying decisions and no decision-making freeze has occurred so far. Anthony Paolone (JPMorgan): Asked if a potential recession would affect office leasing; MacKay replied that demand remains strong, with longer lease terms and no major softening projected in forward models. Anthony Paolone (JPMorgan): Sought details on recruiting and retention; MacKay emphasized ongoing investment in talent, noting the addition of new capital markets and leasing teams. Pat McIlwee (William Blair): Inquired about EMEA services softness and capital allocation balance; CFO Neil Johnston noted EMEA's weak macro environment but highlighted property management growth, while MacKay said capital allocation priorities remain unchanged. In the coming quarters, the StockStory team will monitor (1) continued momentum in Americas and Asia-Pacific leasing and capital markets, (2) evidence of margin stability as investment spending rises and expense timing reverses, and (3) signs of recovery or further contraction in EMEA, particularly in project management and property management. Progress on debt reduction and successful onboarding of new talent will also be closely tracked as indicators of execution. Cushman & Wakefield currently trades at a forward P/E ratio of 9.8×. Should you double down or take your chips? See for yourself in our free research report. The market surged in 2024 and reached record highs after Donald Trump's presidential victory in November, but questions about new economic policies are adding much uncertainty for 2025. While the crowd speculates what might happen next, we're homing in on the companies that can succeed regardless of the political or macroeconomic environment. Put yourself in the driver's seat and build a durable portfolio by checking out our Top 6 Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 176% over the last five years. Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-small-cap company Exlservice (+354% five-year return). Find your next big winner with StockStory today. 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The Independent
12-03-2025
- Business
- The Independent
New Brexit rules risk leaving ‘gaps on shelves' in Northern Ireland by July
New post- Brexit labelling rules could see 'gaps on shelves' in Northern Ireland by July, a Westminster committee has heard. Business representatives told the Northern Ireland Affairs Committee that the Windsor Framework was 'an improvement' on previous post-Brexit trade arrangements but there were still challenges. Concerns were also raised about new parcel delivery requirements needed from March 31, and 'phase three' labelling rules that are to be introduced from July 31. Nichola Mallon, head of trade and devolved policy at Logistics UK, said a 'more trusted' approach was needed on checks. The former SDLP deputy leader said the Windsor Framework was 'an improvement' on the Northern Ireland protocol, but that there were some problems with GB to NI trade. 'I think there is a consensus within our membership that the Windsor Framework was to some extent oversold and it created a misperception that all of the challenges under the Northern Ireland protocol had been removed. 'It has contributed to a lack of awareness, particularly among GB businesses, of the requirements that must be met under the Windsor Framework and, to some degree, there is a reluctance among some GB-based businesses to trade in Northern Ireland because of the administrative and cost requirements.' Neil Johnston, director of the Northern Ireland Retail Consortium, repeatedly raised concerns about new labelling requirements in July, which aim to ensure goods are not moved onwards into the EU. 'We are not Del Boy and Rodney,' he said. 'We are not trying to get our goods secretly over the border into the south.' He said that for supermarket chains such as Asda and Sainsburys, they should not need to fill in 'vast amount of paperwork' to prove the goods are not travelling south of the border, where they do not have branches in that jurisdiction. 'The risk of any of these products from the supermarkets that don't have southern premises going astray is negligible, so why do we have those levels of checks is certainly a question that we are asking regularly. 'In the case of Marks and Sparks and Tesco's, who have big operations in the Republic of Ireland, they have track and trace technology that they have invested heavily in and they should be relied upon without vast levels of inspections and paperwork to be able to deliver that.' He said that while the Windsor Framework was 'an improvement', trading had become 'more and more difficult' in recent times. 'I think we started from the wrong position, the wrong place and basically we have an overly bureaucratic approach. 'I think we have successfully achieved what we were required to do, high levels of compliance at the moment, but it's very, very difficult. 'The nature of our businesses, what's in the back of these trucks is highly diverse and regularly changing, it's not about you get this right once and be done. It's just a neverending saga.' He said that work from businesses had meant customers had largely not noticed the scale of the change, but there was a risk they would by July. 'This is like a swan on a lake. The reason consumers haven't noticed anything is because Nichola's members and my members are pedalling furiously to comply and have achieved a lot. 'Going forward, it's going to become more and more difficult, particularly, as mentioned before, the phase three labelling. 'There are branded products that we cannot tell suppliers to brand them for Northern Ireland. 'The government, to my mind, hasn't really been clear on how they are going to resolve that problem. 'They say they've taken the powers to require those producers to label for Northern Ireland, but it's not very clear as to how that will happen. 'So come July, it's highly likely that there will be gaps on shelves. Household products that people are used to having on their shelves in Northern Ireland may well – I hope not, we've had this before with phase one and phase two – but there may be products that, come the end of July, that disappear.' Ms Mallon said there had been a 'change in tone' from the Government in the last number of months and said the UK-EU reset had 'led to more positive approach to things'. She said there had been a series of webinars and roundtables in Great Britain held about changes. Anne-Marie Murphy, director of strategy and emerging markets at the NI Consumer Council, said they had already identified 'difficulties' in delivering goods from GB to NI. She said 'it isn't going to be business as usual' once the parcel changes come into force on March 31. 'The difficulty about this is that Northern Ireland consumers will be on the receiving end of these arrangements. 'So it is going to be a grandmother sending a gift to her grandchild in Northern Ireland. 'It is going to be a business sending something to a consumer in Northern Ireland. 'It is going to be a consumer in the UK returning a product to a business in Northern Ireland. 'So there's three different processes already and our parcels research has already identified … that there have been some difficulties in relation to delivering to Northern Ireland, either by business deciding that they are not going to deliver to Northern Ireland or it is too difficult, or by some mistakes in the process.' Jennifer Pheasey, director of public affairs at the Horticultural Trades Association, also appeared before the committee on Wednesday.
