Cushman & Wakefield reported a net loss of $100.8 million in the second quarter, down from a $6.3 million profit a year ago.
The loss came despite cost-cutting, as $75 million was trimmed for things such as travel, entertainment, events and incentive compensation.
“I think most of us would agree that the impact of Covid-19 is unique and certainly different from previous recessions such as the great financial crisis,” said CEO Brett White during an earnings conference call Thursday. “However, while the shape of the recovery may differ from the GFC in the second quarter, the initial impact of Covid-19 presented similar behavior in our industry, especially across our leasing and capital markets brokerage businesses.”
Revenue from leasing activities during the second quarter was $264 million, down by 46 percent from $489 million in the same period last year. Revenue from capital market activities was $113 million, down by 52 percent from a year ago.
The firm’s total revenue for the second quarter was about $1.7 billion, down by 18 percent from last year’s $2.1 billion.
As in the first quarter, the steady stream of revenue from property management was a bright spot. That business line made up about 40 percent of total revenue in the second quarter.
In May, the company issued $650 million of senior secured notes, which mature in 2028, to expand its liquidity and be ready for merger and acquisition opportunities, White said.
“As many of you know, in this industry, differentiated real estate service platforms do not tend to trade hands often,” he said. “In times of stress, the market for those businesses can provide generational opportunities and Cushman & Wakefield is well positioned to take advantage of these should they arise.”
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