Q2 2022 Colliers International Group Inc Earnings Call
The conference will begin shortly to raise your hand during Q&A you can dial star one one.
[music].
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Welcome to the Colliers International second quarter Investors Conference call.
Today's call is being recorded.
Legal counsel requires us to advise that the discussion scheduled to take place today may contain forward looking statements.
Both known and unknown risks and uncertainties.
Actual results may be materially different from any future results performance or achievements contemplated in the forward looking statements.
Additional information concerning factors that could cause actual results to differ materially from those in the forward looking statements is contained in the company's annual information form as filed with the Canadian Securities administrators.
And in the company's annual report on form 40 F as filed with the U S Securities and Exchange Commission.
As a reminder, today's call is being recorded today August 3rd 2022 and.
And at this time for opening remarks, and introductions I would like to turn the call over to the global Chairman and Chief Executive Officer, Mr. Jay Hennick. Please go ahead Sir.
Yeah.
Thank you operator, good morning, and thanks for joining us for the second quarter Conference call I'm, Jay Hennick, the chairman and Chief Executive Officer of the company and with me today is Christian Mayer, our Chief Financial Officer.
As always this conference call is being webcast live and is available on the Investor Relations section of our website and a presentation deck is also available there to accompany today's call.
Colliers reported strong second quarter results with solid revenue growth across all service lines.
Spine of war and economic and other geopolitical turmoil in Europe , and the seemingly endless Lockdowns in Asia Colliers continues to perform to expectation through all market cycles.
The fact is we are more balanced more resilient and more diversified than ever.
During the quarter, we continued to grow our investment management segment in both size and scale furthering our goal of becoming a major player in the rapidly growing alternative private capital industry.
We completed two acquisitions in the third after quarter end then in late June We announced the addition of versus capital a highly successful alternative real asset manager in the U S with strong private wealth distribution capabilities.
Once completed our iam business will have a total of more than 85 billion and assets under management and make up about 30% of our pro forma annualized EBITDA.
This segment on a standalone basis already compares favorably to other public companies in the investment management industry.
Our revenues are primarily recurring management fees about 90% of our funds are perpetual or long dated strategies 10 years or more and 70% of them are in rapidly growing sectors like alternatives and infrastructure.
But perhaps most importantly, each of our platforms are led by strong investment professionals, who all significant equity stakes in their own operations and have a long history of delivering top tier performance for investors.
These characteristics among others truly differentiate our business from the rest and the marketplace.
Yeah.
Over the past six years Colliers has built a very valuable investment management business, one in which we see huge potential growth in the future.
Separately during the quarter, we added a significant building consultancy and project management leader in the U K.
Enhancing our service capabilities in Europe , and just yesterday, we added one of the fastest growing engineering companies in Australia, providing us with another growth engine to our already strong operations down under.
Based on acquisitions completed or announced so far this year, we expect 2022 to be a record year for cap capital deployment with more than $1 billion invested in the FERC for the first time in our history.
With our strong global brand and global growth and growth platform proven track record of more than 27 years balanced and diversified business model unique enterprising culture and significant inside ownership colliers expects to continue delivering exceptional returns for shareholders.
For many years to come.
Now, let me turn things over to Christian.
Thank you Jay My comments call the flow of the slides posted on the Investor Relations section of <unk> Dot com to accompany this call.
Please note that the non-GAAP measures referenced on this call are defined in this morning's press release.
References to revenue growth are expressed in local currency.
Our Q2 revenues were $1 1 billion up 23% relative to the prior year period with revenues up strongly across all service lines led by investment management and outsourcing and advisory.
Internal growth was 15%.
<unk> from acquisitions completed during the past 12 months.
Second quarter, adjusted EBITDA was $161 million up 21% from one year ago with margins at 14, 3% roughly flat versus the prior year quarter.
America's revenues for the second quarter were $741 million up 28% over the prior period.
Growth was led by a interesting and advisory up 34% driven by engineering and design, including recent acquisitions.
Capital markets activity was up 28% led by industrial and land asset classes, partially offset by a reduction in debt origination activity due to the current interest rate environment.
Leasing activity was up 20% with growth in both industrial and office asset classes.
Adjusted EBITDA was $102 million up 30% from last year fueled by revenue growth as well as a gain on the termination of a lease partly offset by higher variable cost and a mix change with a reduction in higher margin debt origination.
The Americas margin was up 20 basis points to 13, 7%.
Q2, EMEA revenues were $169 million up 20% from one year ago led by outsourcing and advisory, including the benefit of our recent acquisition.
Adjusted EBITDA was $14 million relative to $21 million last year and was impacted by a reduction in higher margin capital markets revenues due to geopolitical uncertainty in the region as well as higher variable costs.
Asia Pacific revenues were $143 million down, 1% and were impacted by COVID-19, Lockdowns and several Asian markets, which extended until late in the quarter.
Adjusted EBITDA was $20 million or else up to $21 million in the prior year quarter.
Investment management revenues for the second quarter were $75 million up 48% versus the prior year period.
After eliminating the impact of pass through carried interest revenues were $40 were up 45%.
By management fee growth and acquisitions that closed during the quarter.
Adjusted EBITDA for the quarter was $29 million up 36% versus the comparative quarter.
New capital commitments from investors for the first half of the year have been solid.
We have several products presently in the market, including at each of our newly acquired operations.
And including attractive long term opportunities and alternatives.
And infrastructure asset classes.
Given current market conditions, we are seeing investors take more time to make capital allocation decisions. However.
However, our investor base is broader and more diversified than ever before we.
We are confident we will meet our fundraising objectives for the balance of the year.
We ended the second quarter was $68 7 billion of AUM, including Rockwood, which closed on I am sorry.
Putting rockwood, which closed on July <unk>, and <unk>, which is expected to close in Q4.
AUM is now $87 million.
Our trailing 12 month investment management pro forma adjusted EBITDA is currently $220 million, which represents 30% of our consolidated total as Jay mentioned earlier.
Our reported adjusted EBITDA is equivalent to fee related earnings or F. R E.
Many pure play I am firms report since our Iam earnings come predominantly from recurring management fees.
In the coming quarters, we will enhance our iam segment reporting to give shareholders a better sense of these operations and their strong growth prospects.
As of June 30, our financial leverage ratio defined as net debt to pro forma adjusted EBITDA was one four times.
<unk> acquisitions that have been announced but were not completed as of June 30.
Actual leverage is two times.
Inside our comfort zone, and we expect to Delever over time, using operating cash flow pay down acquisition debt.
In may we renewed our revolving credit facility, increasing capacity to $1 5 billion from $1 billion and extending the term to 2027.
The new revolver is sustainability linked and includes three ESG metrics aligned with our elevate the built environment strategy.
We are updating our outlook for the full year 2022 to reflect recently announced acquisitions and our first half operating results.
The outlook are subject to risks and uncertainties as outlined in the accompanying slides.
We expect low double digit revenue growth.
<unk> of high single digit internal growth and the balance from acquisitions, including Rockwood versus and peak urban.
We expect our adjusted EBITDA margin to improve 60 to 100 basis points relative to 2021 from a combination of higher margin acquisitions and internal operating leverage.
Finally, our adjusted earnings per share are expected to grow at a low twenties percentage rate.
That concludes my prepared remarks, I would now like to open the call for questions. Operator can you. Please open the lines.
As a reminder, if you'd like to ask a question you will need to press star one one on your telephone.
Please standby, while we compile the Q&A roster.
Yeah.
Our first question comes from George <unk> with Scotiabank. Your line is now open.
Hi, guys congrats on a strong quarter.
It seems like lifting guidance mainly reflects.
This strong order as opposed to maybe.
In the back half improvements inorganic numbers. So just wondering is there an element.
Of conservatism in there can you maybe share with us what youre seeing in the funnel for that.
They are important in Q4, a quarter in terms of a transactional volumes.
George we can hardly area with your muffling into now can you can you give us a quick question again.
Sure I was just wondering maybe.
If you can talk to a little bit about.
The transact with your outlook for transaction volumes.
In Q4, it seems that the guidance that we raised and that really lift our back half organic numbers. While I was just wondering if you could talk about.
Yeah.
Well, George we had a strong first half.
And you're correct, we haven't really adjusted our guidance for our base business other than to.
Reflect acquisitions that are announced and that and being completed.
Various points in the back half of the year.
We've had very strong organic growth year to date.
The order of 20%.
We expect that to.
Organic growth rate to slow in the back half as we have all year long there are tough comps in Q3 and four.
We do expect to have strong activity, but it won't be.
At 20% like it was the first half of 'twenty two.
Obviously, there is there.
Interest rate changes and other things that when you compare that to last year.
It makes it it makes it a little harder for us, but we're still confident we'll deliver our our expectations for the year.
Okay.
Moving over to investment management.
<unk>.
Jay you say that 70% of AUM is.
As in the rapidly growing sectors like alternative and infrastructure. Just wondering is the aim to keep the mix the same or can we maybe see more traditional assets in there that lend themselves to maybe more immediate synergies.
Okay.
Well, it's interesting, we're finding immediate synergies and several.
The infrastructure.
Type.
Opportunities. So for example, our engineering business is doing a lot of business with.
With.
With our our infrastructure operations traditional assets, which as Colliers global investors now and of course, Rockwood capital, which is an absolute superstar in its space.
Creates additional synergies on our on our base business. So.
Those are just starting.
In Europe , it's been we've leveraged that for a while now.
We're very comfortable with the <unk>.
Activity that we're getting in both traditional and with infrastructure in particular, we're seeing lots of joint opportunities between.
Our core business, which is now expanded to engineering as.
As well.
Okay. That's helpful and maybe one last one for me for Christian can you maybe talk a little bit maybe share where you are.
Fundraising objectives are for the year, maybe like just give us a ballpark number.
Yes no.
A number that we.
We'll keep internal.
That probably disclose.
But certainly we have none.
<unk>.
Engines now for fundraising.
With the the various Platt.
Platforms and infrastructure with the salt Rockwood and traditional assets.
So as well as Harrison Street, which continues to be.
Be very strong and alternatives and also infrastructure so.
We're looking across the board and hoping to <unk>.
Generation significant capital inflows in the back half of the year.
Alright, Thanks Roxana.
Our next.
Question comes from Scott <unk> with CIBC. Your line is now open Scott.
Hi, gentlemen, thanks for taking my question just a quick question on the Q2 performance and the <unk>.
For the non recurring revenue businesses in particular the transaction business.
And maybe you could talk a little bit about it by asset class space.
Okay.
Yes, Scott we had another strong quarter in Q2.
With with a strong <unk>.
Growth in capital markets as well as as well as leasing.
And it's been in a variety of asset classes as I mentioned.
Industrial land.
Multifamily on the on the.
The capital market side.
And then obviously seeing in industrial.
On the on the leasing side.
There continues to be good momentum in all of those asset classes, but.
But we're coming into some tougher comparison in Q3 and Q4 and as you can see in our in our full year outlook I mean, our organic growth rate.
For the full year is in the high single digits and we've been running as I mentioned to the previous question been running 20% organic growth here in the first half of the year. So certainly.
It's going to be more difficult.
In the back half of the year and interest rates and market conditions.
Conditions.
Will people will be part of that.
But we feel.
Pretty good about our prospects.
Despite all of that.
I might add something.
Just some additional color.
At both leasing and capital markets are up nicely, 18%, 16% with.
With lots of internal growth, a 50% I think across the board internal growth.
But in the leasing.
Office, primarily CBD.
Those were posting we're posting increases in leasing up 18%.
Office leasing CBD.
It is not yet totally clear.
No.
So.
If there becomes more clarity and what people do around office in the next couple of months I think that that number could really spike.
We are posting great numbers notwithstanding.
The uncertainty in sort of traditional office leasing so much.
<unk>, a very carefully it's happening in most markets around the world.
And.
Decisions are taking longer people are rethinking the amount of space they need work from home is.
It's something that that is not consistent across companies different companies operate and operate differently. So their need for additional space is different so.
The only area that we're seeing.
There is no clarity yet is leasing.
Office traditional office CBD in particular.
Thanks, and do you have a sense from talking with your client base.
What they are thinking for the new year or is that just too far out in the year.
The current environment.
Well youre talking in terms of leasing for office.
Yes at leasing and capital markets.
Not just office, but in general across asset classes.
Well, it's a can't really go general so I would also say if you want to talk about capital markets.
Debt capital markets for office product.
Is not as clear also so that's another segment.
The asset class that has a room to two to.
To grow in the coming quarters, but I don't think.
Underwriting is clear.
And buying office buildings today.
And unless you can steal them whatever that means that it's different in different markets are different.
Alrighty.
<unk>.
Buildings and the same thing with leasing.
Yes.
Great. Thanks.
Very helpful color.
Okay.
Our next question comes from Stephen Macleod with BMO capital markets. Your line is now open.
Thank you good morning, guys.
Hey, Steve.
I just had a couple of questions here regarding what you're seeing in the marketplace. Jay you made an interesting comment.
In your prepared remarks around <unk>.
Investors, taking more time to make capital allocation decisions when it comes to investment management and I'm. Just curious is that is that something that youre seeing.
Develop as well on the capital markets and leasing side of things.
Well again its category its asset class based.
Any multifamily industrial even retail is perking up now those assets when they come to market.
Assets are still.
Actively pursued.
Okay.
It's not not as active with with office product and things like that.
Any alternative assets.
The types of assets that Ericsson Street would buy the types of assets that are salt might look at.
EBIT Rockwood Rockwood has a very big multifamily.
Our business.
Those are all highly sought after.
And many in many ways because there they adjust themselves and accurately each year when it comes to rent renewals and stuff like that so they can adjust upwardly in downward lay based on <unk>.
Economic factors so.
It's really it's really all over the map.
When we distill it back down to the actual results we've delivered AD.
Even going back to pre pandemic add through the pandemic.
Being diversified in both globally and by service line and by asset class.
And.
<unk> provides so much diversification in this business model that we have and frankly, we're not the only one I would say that our.
Our largest peer CBRE.
It has many of the same qualities that we do as well.
<unk>.
<unk>.
And yet.
I don't think the market really truly.
Gives them the benefit of the doubt when it comes to valuation so.
I think these diversified services company is something that I know a little bit about over the last 27 years are phenomenal ways to create shareholder value at surely we've done it over so many years and I would say that we're more excited today about what colliers can do.
<unk>.
In the coming years.
Ever before sorry to go on but.
I can only lead horses to water.
Make them drink.
Okay.
Yeah, No that's that's great.
You.
<unk> rates, creating an uncertainty out there as well have you seen any have you begun to see.
The prospect of rising rates or actual rising rates impacting velocity of transactions.
For sure for sure.
Previously somebody could leverage leverage in asset and.
And generate.
So yield on the cash portion we're seeing with.
Based on interest rates today, we're seeing that there is a lot more cash required to make to make.
To make the sale happen.
Which means that there is downward pressure on pricing.
And but that's the other beautiful thing about our business.
We don't own real estate.
Our clients do in our investment management arm, but we're a trans actor so as long as there is transactions.
All yours does nicely and theres been lots of velocity of transactions virtually across the board as you can see with 15% internal growth those are pretty impressive numbers numbers I haven't seen in a lot of years.
Okay.
That's great color. Thanks, Jay Thanks Christian.
Okay.
Our next question comes from Jenny Lutheran with Goldman Sachs. Your line is now open.
Hi, Good morning, Thank you for taking my question.
In terms of the 6200 margin expansion versus 40 to 80 bps prior.
Much of that is attributed to acquisitions, where system efficiency and the legacy business and operating leverage.
Is it a way to parse that out.
Yeah, Jamie I think the majority of it will come from the acquisitions and as you can as you can see the acquisitions are.
Predominantly investment management businesses, which carry.
Much higher margins than the.
In the services business.
Makes sense and if I could just follow up with that so the recent acquisition the worst this business the alternatives right.
Obviously the margin structure is very very lucrative beer.
Voice does even the legacy investment management business margins just closer to 40, so is that something that you're actively considering and do you plan to even within your.
Sort of mandate to increase the investment management business should we think about future acquisitions more on lines of Borgwarner.
Or or infrastructure versus traditional.
Well shandy, we are being very strategic and opportunistic and the types of acquisitions that we've completed over the past six years have all been hand selected and nuanced because the.
For us the key thing is the leadership teams.
And their commitment to the business long term and that is a real differentiator for colliers, So and it has been for colliers for the past 2008 years. So we know how to select great leadership teams, we know how to partner with them to help them grow double or triple the size of their business over the course of time.
And and so we will continue to look for the right types of companies now.
Infrastructure renewables.
Even traditional asset classes.
Alright, like Rockwood Rockwood has a lot of.
Alternative assets that as a very interesting that platform has a rapidly growing multifamily platform.
And so.
Youll get both traditional and some acquisitions like Rockwood Youll have both traditional asset classes and you'll also have alternatives.
And in the traditional asset classes in a case like rockwood they they hold those assets for.
In some cases in perpetuity.
Until they decide that.
That asset does not make sense for them, but generally speaking they tend to find the highest quality buildings in all of them for the long term and so that's those are the types of characteristics and quality, we look for when we when we.
Look for an acquisition so it's not it's not.
Not run of the mill.
Separate accounts business or fund of fund businesses for example.
And Jamie just to add to that you start the question on the margin point and certainly we're looking for businesses that are generating high EBITDA margins with recurring.
Long term management fee revenue streams.
So that's part of the math here and is included as part of the.
Criteria that Jay outlined with the right management teams the right types of assets the right type of growth profile.
The margin profile has to be there too and obviously these doses are also.
Very capital light, which we love generating a lot of free cash flow. So all of those criteria.
Thanks for the color guys congrats on a strong quarter.
Okay.
Our next question comes from Stephen Sheldon with William Blair. Your line is now open.
Hi team. This is Patrick on for Steven This morning. So now that you roughly you hit your goal of 30% of adjusted EBITDA from CIM business.
Given your commentary on the continued strength youre seeing in those businesses I just wanted to ask if there is potential for that target to move higher and in general what your pipeline looks like there.
Sure.
For sure there is potential for us to to have that grow higher.
<unk>.
As I sort of alluded to in a couple of the earlier answers, we sort of see ourselves as a highly diversified services business, we have growth engines.
At our core business in outsourcing and advisory Youre seeing lots of growth there but.
But we continue to see growth in our investment management arm, we have some interesting opportunities. We continue to look look at these are generally long duration. So.
I would say.
Our ongoing conversations with targets, particularly because we.
We like to meet the targets well in advance of the transaction and get to know understand what their motivation is and so.
We have a lot of active conversations our model is very attractive to many who.
Believe they need a strong equity permanent equity partner to help build their business long term and potentially to allocate.
Shares to some of their up and coming.
Professionals. So we are a perfect.
<unk> for them and so we've got.
We've got lots of interesting irons in the fire, but they will only come when when they are ready.
<unk>.
But we're setting ourselves up for continued growth for sure.
Okay.
Great. Thanks for the additional detail there Jay and then.
I wanted to ask I'm not sure. If you guys have discussed this publicly but if you can provide any color on your overall exposure to office space and then.
Possible what you're.
Mix are waiting looks like in terms of class a versus class P&C office space and just the trends you're seeing across those asset types.
Yes.
Well I mean, I'll answer that we're a global business highly diversified we have asset classes everywhere. The answer is different in Los Angeles and in Chengdu, China. So.
I can't give you a general numbers other than what we disclose.
And the color that I gave earlier.
I would just I would just repeat.
Which is.
Our strong we're seeing strong internal growth across most asset classes.
Office is challenged.
And some other.
Some other assets some retail mostly shopping malls continue to be challenged.
But generally speaking.
Yeah.
Yeah.
We continue to see great velocity across all of the asset classes.
With those exceptions.
Understood understood and thanks for thanks.
Thanks for the questions and congrats on a good quarter.
Thanks.
Our next question comes from the line of Daryl Young with TD Securities. Your line is now open.
Hey, good morning, gentlemen.
The first question is around the.
First question is around the OLED business.
The exceptionally strong growth rates and you alluded to a few things already but.
And engineering I think really bolstering the results in there, but is there anything in terms of cross sell or.
Okay.
Anything in particular, you can point to that's really caused this acceleration it seemed like some of the strongest rates, we've seen a bit of O&M.
Yes, we are.
Tenuously focusing on on cross sell and the O&M business.
Project management.
In engineering.
Engineering and new business for US two years tiers, all cross sign out with our project management businesses, which we've been in for many years.
Getting inroads into.
Our Harrison Street platform has been very fruitful for us.
With the engineering and project management.
Services, we have msas with that number that Harrison Street funds and we are.
As we speak providing.
Services at the asset level.
That was Harrison Street funds.
Also provide that.
Services debt placement and bond placement services.
For Harrison Street funds, and we hope that we will expand to other parts of the investment management business.
<unk>.
For sure with the U S.
S presence that it has can can benefit from that so we're looking.
Always ways to cross sell and enhance the revenues.
Ross our platform across our service lines.
Another Great example, just to add to Christians. Another Great example, as peak urban in each of our engineering firms have a significant business.
In preparing land for development, so a municipality.
<unk> might hire.
An engineering firm to help prepare.
Release of land developer might higher.
A an engineering firm to help design and prepare land for development.
And it's the same types of clients that colliers has so the same developer client.
It would be using an engineering firm to help them.
Set up the master planned community for subsequent development and so engineering has allowed us to really expand.
Christian already mentioned project management, which is becoming a very significant business for us I think engineering project management together.
It's probably approaching $900 million on an annualized basis.
And.
And.
You know.
Each one of these projects requires oversight and management and that creates a great cross selling opportunity for developers for Harrison Street as Christian already mentioned in other of our investment.
Arms that are developing expanding are doing additional work on existing properties. So it really is a natural addition to what we do and we see huge potential in continuing to grow it globally as you saw with peak urban.
You saw.
Nice project Management addition, in the UK this quarter and those types of acquisitions will just continue.
And as I've mentioned in past calls the beauty of being a one of the leading players in global real estate is that not only do you have a brand thats highly recognized as an institutional Brad but you also have a great leadership team that is highly motivated.
The world to help integrate those acquisitions maximize them, including cross selling of services.
Okay terrific.
And then just one other question around the investment management platform.
Are there milestones or objectives that we should be thinking about in terms of.
Tying together all of these.
Kind of I'll call them highly specialized.
The segments that you have now.
<unk>.
Or would you see them as continuing to grow fairly decentralized independently and then.
Getting a little long, but on the vs side, just maybe a little more color on the.
The retail angle.
Asset accumulation there.
Yes so.
So.
We have clear goals in investment management. The first was we wanted to be a $100 billion in AUM.
Within five years that was a year and a half ago. So we're getting pretty close to that goal.
Our our plan for investment management and as Christian says, we will continue to outline more of this over the coming quarters is to leverage the colliers unique partnership philosophy and maintain.
Autonomy and ownership minority ownership of each of the platforms, but have a hybrid approach so fund raising.
Governance.
Capital allocation certain things like that where they can all benefit from sharing best ideas and practices.
And we are well down the law well down the road on this we thankfully started two or three years ago with Harrison Street, and Colliers Global investors. So this is not new to us.
But with this new group of additions.
We will we will be accelerating that and hopefully provide a little bit of.
Yes.
Strategy around that in the coming quarters.
And in terms of.
Is that good enough for you on that one.
Yes, no that does.
That's great color. Thank you.
Okay and in terms of versus versus again.
Exceptional company run by an exceptional group of <unk>.
Leaders in addition to their base business, which has been very very successful.
Successful over many years, including great returns they have over many years developed a distribution channel through the RIAA the registered investment advisor channel.
That is second to none.
And it has served them well.
But we believe that given the strong leadership team in that segment of their business, we can expand that business to include.
Originating capital for our other investment management arm. So all of all of all of our platforms are excited about that obviously, we havent closed on versus yet it'll probably be in the third or fourth quarter I don't know I don't know the exact date, but.
Are hard at work.
To put the pieces in place to accelerate that aspect of our growth engine going forward. So it really augments our distribution to the retail side of the world.
Obviously, we've been very successful with the institutional side Lps sovereign wealth funds and the like but this gives us a whole new area of growth.
And one that we can leverage across many different platforms. So we're very excited about it.
Okay. That's great. That's all the questions for me congrats on a good result, guys.
Our next question comes from Frederic Bastien with Raymond James Your line is now open.
Good morning, Jay I know you've been attracted to investment management for some time now and you noted earlier the many ongoing discussions you are having but.
Just wondering what has triggered all of this careful in the past six to 12 months have there been more owners looking to monetize or their valuation expectations, Marty reasonable say combination of both or.
Something else.
It is.
It's a great question.
We started this six years ago, we had countless meetings.
All around the world with the types of targets that we thought would make sense for us we planted seeds and you've seen us do this in other parts of our world two over the year spread.
<unk>.
I think.
I think.
There has been a realization.
That.
To fix I think a realization about two things number one that firms deep for the long term need to be owned by a wider group of shareholders not just the original founders. So the original founders are looking for ways to.
Reallocate equity in their business to a wider group of shareholders, which as you know is is perfectly aligned with us in so many ways and I think the other thing Thats happened.
Over the past.
You know three four years there has been.
Other monetizing events at some of these firms that we've acquired where they brought in a partner.
Minority partners or others that are just not worked out or the partner didn't add value as we can add value and there was just there is just a natural opportunity to.
To reallocate the share register to those people that are going to help pull a lag in day to day. So we're trying to capitalize on and thankfully we have a strong balance sheet.
And the ability to to continue to.
To pursue these.
We're very careful about the types of people, we want to partner with and.
Again, just to say the same thing again, we've done this for 28 years. So in many ways. It's it's something that we're very comfortable with and we believe.
We have a good sense for the type of partners that are kind of people.
Great. Thanks, Thanks for that Jay.
I guess switching to the Colliers E&P strategy can we expect U.
You've been focusing predominantly on the U S. Now we've seen you go into Australia analysis, obviously lots of areas, where you can grow but.
Are you interested in Maine.
Maintaining your efforts on OECD countries or could we see you expand to other areas where colors as a presence.
Thinking, maybe India, or China or would you focus on predominantly the OECD countries.
Yes, it's an interesting question Frederic I mean, we're so far we're in two countries and there's so much more to do.
With the engineering and design business and the project management business.
Look like I think we're going to focus on.
Some of the.
More mature markets.
And.
But I would never say never to an opportunity in India. If that one if that comes to fruition at some point in the future.
Okay Alright.
Yes.
Sorry go ahead significant.
We have a significant project management business already in India. So it would it would be a very complementary move there if the right opportunity presented itself.
Okay. Thanks for the clarification and thank you.
Thanks Frank.
Operator any more questions.
We do have a question from the line of Scott Thompson with CIBC. Your line is now open.
Okay.
Yes, you bet.
Yes.
The buyback.
Scott Cat areas areas Scott try.
Try again.
Okay.
Good question.
The NCI.
Program about it back.
The current valuation do you expect to be.
Active and remainder of 2022.
Scott you're asking about.
Issuer bid.
Yes, so I think we.
<unk>.
Excuse me.
We have been active this year on the issuer bid we did recently renew our issuer bid for the next 12 months.
And you saw the press release on that.
Matt.
We are allocating capital first and foremost to acquisitions this year.
With over $1 billion of investment there.
We may return.
To the issuer bid at some point later this year.
Yeah.
Consider that at the time based on our acquisition pipeline based on our trading price at the time.
And our leverage so.
And we're keeping that option open.
Great. Thanks again.
I am showing no further questions in queue at this time I'd like to turn the call back to Mr. <unk> for closing remarks.
Thank you operator, and thanks to everyone for participating.
We look forward to two meeting again at our next quarterly conference call. Thank you.
Ladies and gentlemen, this concludes the conference call.
Thank you for your participation and have a nice day.
Yes.
The conference will begin shortly to raise your hand during Q&A you can dial star one one.
[music].