CB Richard Ellis has made a $1.2bn writedown of goodwill and other intangible assets, causing it to make a consolidated net loss of $1bn for 2008.
The impairment charges, revealed in CBRE’s annual report which was published on Monday, are non-cash and do not affect liquidity, cash flows from operating activities or compliance with debt covenants. CBRE said the charges ‘were primarily driven by adverse economic conditions, causing a decline in the estimated future discounted cashflows for several of our reporting units’.
They had been flagged by CBRE when it reported its results in February. The company said at the time that the results did not include the impact of ‘significant, pending, non-cash goodwill and other non-amortisable intangible asset impairments’, which were still being assessed. It added it would have ‘significant impairment charges to record, most likely in the Americas, EMEA and development services segments’.
Without the $1.2bn of writedowns CBRE made a net profit of $83.9m (£57.9m), or $0.39 a share, in 2008, which was 79% lower than the $496.8m (£342.9m), or $2.11 a share profit n 2007.
Revenue was 15% lower at $5.1bn (£3.5bn) and earnings before interest, taxes, depreciation and amortisation were 45% lower at $457m (£315.5m).