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Segment Data
3 Months Ended
Mar. 31, 2019
Segment Reporting [Abstract]  
Segment Data
Note 3: Segment Data
The Company reports its operations through the following segments: (1) Americas, (2) Europe, the Middle East and Africa (“EMEA”) and (3) Asia Pacific (“APAC”). The Americas consists of operations located in the United States, Canada and key markets in Latin America. EMEA includes operations in the UK, France, Netherlands and other markets in Europe and the Middle East. APAC includes operations in Australia, Singapore, China and other markets in the Asia Pacific region. For segment reporting, gross contract costs are excluded from revenue in determining “Fee revenue”. Additionally, pursuant to business combination accounting rules, certain Fee revenue that was deferred by the acquiree may be recorded as a receivable on the acquisition date by the Company. Such contingent Fee revenue is recorded for segment reporting as an acquisition accounting adjustment to reflect the revenue recognition of the Company absent the application of acquisition accounting.
Corporate expenses are allocated to the segments based upon Fee revenue of each segment. Gross contract costs are excluded from operating expenses in determining “Fee-based operating expenses”.
Adjusted EBITDA is the profitability metric reported to the chief operating decision maker (“CODM”) for purposes of making decisions about allocation of resources to each segment and assessing performance of each segment. Adjusted EBITDA excludes depreciation and amortization, interest expense, net of interest income, income taxes, as well as integration and other costs related to acquisitions, expenses related to the Cassidy Turley deferred payment obligation (the "DPO"), stock-based compensation for plans enacted before the Company's IPO ("pre-IPO stock-based compensation") and other charges.
Summarized financial information by segment is as follows (in millions):
Americas
 
 
 
Three Months Ended March 31,
 
2019
2018
Total revenue
$
1,347.6

$
1,206.2

Less: Gross contract costs
(410.5
)
(356.3
)
Acquisition accounting adjustments

0.1

Total Fee revenue
$
937.1

$
850.0

 
 
 
Service lines:
 
 
   Property, facilities and project management
$
463.0

$
404.2

   Leasing
297.3

246.0

   Capital markets
140.4

163.1

   Valuation and other
36.4

36.7

Total Fee revenue
$
937.1

$
850.0

 
 
 
Segment operating expenses
$
1,277.3

$
1,143.9

Less: Gross contract costs
(410.5
)
(356.3
)
Total Fee-based operating expenses
$
866.8

$
787.6

 
 
 
Adjusted EBITDA
$
70.3

$
62.5

EMEA
 
 
 
Three Months Ended March 31,
 
2019
2018
Total revenue
$
202.6

$
209.2

Less: Gross contract costs
(18.8
)
(45.9
)
Total Fee revenue
$
183.8

$
163.3

 
 
 
Service lines:
 
 
   Property, facilities and project management
$
69.8

$
54.6

   Leasing
48.8

47.9

   Capital markets
26.4

23.9

   Valuation and other
38.8

36.9

Total Fee revenue
$
183.8

$
163.3

 
 
 
Segment operating expenses
$
204.2

$
219.2

Less: Gross contract costs
(18.8
)
(45.9
)
Total Fee-based operating expenses
$
185.4

$
173.3

 
 
 
Adjusted EBITDA
$
(0.2
)
$
(8.6
)
APAC
 
 
 
Three Months Ended March 31,
 
2019
2018
Total revenue
$
352.8

$
352.3

Less: Gross contract costs
(101.7
)
(119.6
)
Total Fee revenue
$
251.1

$
232.7


 
 
Service lines:
 
 
   Property, facilities and project management
$
174.0

$
156.2

   Leasing
26.8

26.0

   Capital markets
23.9

27.1

   Valuation and other
26.4

23.4

Total Fee revenue
$
251.1

$
232.7

 
 
 
Segment operating expenses
$
334.5

$
331.3

Less: Gross contract costs
(101.7
)
(119.6
)
Total Fee-based operating expenses
$
232.8

$
211.7

 
 
 
Adjusted EBITDA
$
18.3

$
20.9


Adjusted EBITDA is calculated as follows (in millions):
 
Three Months Ended March 31,
 
2019
2018
Net loss
$
(20.9
)
$
(92.9
)
Add/(less):
 
 
Depreciation and amortization
73.5

69.8

Interest expense, net of interest income
37.2

44.4

Benefit from income taxes
(40.9
)
(32.0
)
Integration and other costs related to acquisitions
21.4

66.2

Pre-IPO stock-based compensation
11.6

6.8

Cassidy Turley deferred payment obligation

10.4

Other
6.5

2.1

Adjusted EBITDA
$
88.4

$
74.8


Below is the reconciliation of total costs and expenses to Fee-based operating expenses (in millions):
 
Three Months Ended March 31,
 
2019
2018
Total operating expenses
$
1,929.0

$
1,849.6

Less: Gross contract costs
(531.0
)
(521.8
)
Fee-based operating expenses
$
1,398.0

$
1,327.8


Below is the reconciliation of total costs of Fee-based operating expenses by segment to Consolidated Fee-based operating expenses (in millions):
 
Three Months Ended March 31,
 
2019
2018
Americas Fee-based operating expenses
$
866.8

$
787.6

EMEA Fee-based operating expenses
185.4

173.3

APAC Fee-based operating expenses
232.8

211.7

Segment Fee-based operating expenses
1,285.0

1,172.6

 
 
 
Depreciation and amortization
73.5

69.8

Integration and other costs related to acquisitions(1)
21.4

66.1

Pre-IPO stock-based compensation
11.6

6.8

Cassidy Turley deferred payment obligation

10.4

Other
6.5

2.1

Fee-based operating expenses
$
1,398.0

$
1,327.8

(1) Represents integration and other costs related to acquisitions, comprised of certain direct and incremental costs resulting from acquisitions and related integration efforts, as well as costs related to restructuring programs. Excludes the impact of acquisition accounting revenue adjustments as these amounts do not impact operating expenses.