Ladies and gentlemen, welcome to the Annual General and Special Meeting of Colliers International Group Inc. Please note the meeting will be recorded. I would like to introduce Peter Cohen, Vice Chairman and Lead Director of Colliers. Mr. Cohen, the floor is yours.
Good morning, ladies and gentlemen. I will be acting as Chair of this meeting. Before we begin the official part of the meeting, Please allow me to introduce those members of the Colliers management team that are also attending this meeting virtually: Jay Hennick, Chairman and Chief Executive Officer Christian Mayer, Chief Financial Officer Matthew Hawkins, the Corporate Secretary and Linda Crawley, Assistant Corporate Secretary. Before we begin the formal part of the meeting, I would like to take this opportunity to thank everyone for joining us virtually today. Following the conduct of the formal business of today's meeting, we will present a short video followed by a question and answer session.
If you are a registered shareholder or a duly appointed proxy holder that provided your control number while logging into the meeting and have a question, Please feel free to use the Ask a question feature shown on your screen, and it will be addressed at the appropriate time. It is now past 11 a. M, and I would like to ask that the annual meeting of shareholders of Colliers come to order. With the consent of the meeting, I will act as chair, and in accordance with Collier's bylaws, Matthew Hawkins will act as secretary, and TSX Trust Company will act as scrutineer of the meeting. The minutes of the last annual meeting and special meeting of Shareholders held on April 7, 2020, are with me.
And with the consent of the meeting, we will dispense with the reading of these minutes and the minutes shall be taken as read. I am also tabling a copy of the audited consolidated financial statements of Colliers for the year ended December 31, 2020, and the auditor's report attached thereon. You will have received them with the meeting materials, and a copy is also available by clicking through the appropriate link shown on your screen. With the consent of the meeting, the reading of the auditor's report will be dispensed with and the financial statements shall be received. Will the scrutineer please report whether there is a quorum present?
According to the bylaws of Colliers, a quorum for any meeting of shareholders is any 2 shareholders entitled to Vote at the meeting, whether present in person or represented by proxy, based on all available attendance information, we have a quorum of shareholders. A copy of the final scrutineers report will be annexed to the minutes of this meeting.
Thank you. I am advised that there is a quorum present. As the quorum is present, I declare the meeting to be regularly called and properly constituted for the transaction of business. I note that we have received duly completed proxies that have appointed myself or Matthew Hawkins as proxy holders in respect of approximately 93% of the total votes associated with Colliers shares. In connection with each matter of formal business voted upon at the meeting, Mr.
Hawkins will vote in accordance with the instructions set out in each proxy. A summary of the voting results on each matter A formal business will be included in a press release to be issued following the meeting and a report on the voting results will be filed on SEDAR. Voting will be conducted using the TSX Trust virtual voting platform that is available on the screen to those that have logged in using their control number. At this point, I will ask CSX Trust to please open the platform for voting on all resolutions. While I will review each matter of business individually, registered shareholders and proxy holders that are logged in using their control numbers are able to vote on all resolutions at any point while voting remains open.
The first item of formal business is to consider a resolution appointing PricewaterhouseCoopers, LLP, as independent auditors of WaterhouseCoopers LLP as independent auditors of Colliers and remuneration to be fixed by the directors. In order to be approved, the resolution must be passed by a majority of the votes cast. May I have a motion for the approval of this resolution?
Mr. Chairman, I move that PricewaterhouseCoopers LLP be appointed as independent auditors of Colliers to hold office until the close of the next annual meeting of shareholders at a remuneration to be fixed by the Board of Directors of Colliers.
Mr. Chairman, I second the motion.
Thank you. As previously indicated, voting is now open on this motion, and you are encouraged to vote using the voting tab shown on your screen. Based on proxies received prior to the meeting, it is expected that this resolution will be approved. The next item of business is the election of 9 directors. These directors will hold office until the next annual meeting of shareholders or until their successors are elected or appointed or they have otherwise ceased to hold office.
The management information circular states That there are 9 proposed candidates. The Secretary will now read their names.
The names of the Director nominees are Peter F. Cohen, John Jack P. Curtin, Jr, Christopher Galvin, Jane Gavin, Stephen J. Harper, J. S.
Hennick, Catherine M. Lee, Benjamin F. Stein and L. Frederick Sutherland.
Thank you. I would like to remind shareholders that the directors are to be voted on individually in in accordance with Colliers' majority voting policy. I now recognize Christian Mayer.
Mr. Chairman, I nominate each of the 9 persons whose names have been read to this meeting and move that such persons so nominated be individually elected as Directors of Colliers to serve until the next annual meeting of shareholders or until his or her successor is elected or appointed or he or she otherwise ceases to hold office.
Mr. Chairman, I second this motion.
Thank you. Voting on each of the individual director nominees may now be completed using the voting tab on your screen and will remain open until voting is closed. Based on proxies received prior to the meeting, it is expected that each of the nominated directors will be elected. We will now consider the next item of business before this meeting as described in the management information circular that Colliers is seeking approval of a resolution approving an amendment to the Collier Stock Option Plan. The amendment will increase the maximum number of subordinated voting shares reserved for issuance pursuant to the exercise of stock options granted by an additional 1,000,000 shares.
The form of the resolution is Set out on Page 61 of the management information circular. In order for this resolution to be passed, it must be approved by a majority of the votes cast. The amendment to the Stock Option Plan must also receive exchange approval in order to become effective. The Toronto Stock Exchange has approved this amendment, subject to obtaining shareholder approval today. May I have a motion for the approval of this resolution?
Mr. Chairman, I move that the resolution approving the amendment to the Colliers Stock Option Plan, the form of which is set out on Page 61 of the management information circular furnished to shareholders in respect of this meeting be approved.
Mr. Chairman, I second the motion.
Thank you. Have any questions relevant to this resolution been asked using the Ask a Question feature?
No such questions have been asked.
Okay then. Voting on this matter of business may now be completed using the voting tab on your screen and will remain open until voting is closed. Based on proxies received again prior to this meeting, it is expected that this resolution will be approved. The next matter of business is to consider the advisory vote on executive compensation set out in the management information circular mailed to shareholders. May I have a motion to consider this resolution?
Mr. Chairman, I move that the meeting consider and if deemed advisable, passed on an advisory basis and without diminishing the role and responsibilities of the Board of Directors that the shareholders of Colliers except the approach to executive compensation disclosed in the management information circular delivered to shareholders.
Mr. Chairman, I second the motion.
Thank you. Have any questions relevant to this resolution been asked using the Ask a Question feature?
No such questions have been asked.
Thank you. Then voting on this matter may now be completed using the voting tab on your screen and will remain open until voting is closed. Based on proxies received prior to the meeting, it is expected that this resolution will be approved. We will now consider the final item of business As detailed in the management information circular, Colliers is seeking approval of a resolution to approve a transaction to settle the existing management services agreement, including the long term incentive arrangement included therein between Colliers and accompanied controlled by Jay Hennick, Collier's Chairman and Chief Executive Officer. In addition, the transaction will, if completed, Establish an ordinary time line for the elimination of Collier's dual class voting structure by no later than September 1, 2028.
A full description of the transaction is included in the management information circular. The full form of this transaction resolution to be approved is set out in Appendix A to the management information circular. In order for this resolution to be passed, it must be approved by a majority of the votes cast by holders of the subordinated voting shares, excluding Henset Capital, Inc, an entity controlled by Mr. Hennig. May I have a motion for the approval of this resolution?
Mr. Chairman, I move that the transaction resolution,
the form
of which is set out in Appendix A to the management information circular furnished to shareholders in respect of this meeting be approved.
Mr. Chairman, I second the motion.
Thank you. Have any questions relevant to the resolution been asked using the Ask a Question feature?
No such questions have been asked.
Thank you. Voting on this matter of business may now be completed using the voting tab on your screen and will remain open until voting is closed. Based on proxies received prior to the meeting, it is expected that the resolution will be approved. As this is the final matter of formal business on the meeting agenda, voting on all resolutions will close momentarily, and shareholders are encouraged to ensure that their votes have been submitted. I would now like to request that TSX Trust Please close all voting.
Based on proxies approved prior to the meeting and the preliminary scrutineers report received, I can confirm that all resolutions have been passed by the requisite number of votes in favor. Detailed voting results will be included in the press release to be filed following the meeting, together with the report on voting results to be filed on SEDAR. As there is no further business, I declare the formal portion of this meeting terminated. At this point, I would like to ask TSX Trust to place the go ahead and play our video presentation, and a question and answer period will then follow.
At Colliers, we're proud of merchandising culture, our diversified business and our long history of success. Our better than expected results in 2020 are a testament to the commitment of our people, The loyalty of our clients and the bold steps we've taken to transform Colliers into a more balanced And resilient professional services and investment management company. Since 2004, we have taken our enterprise to the forefront of our in the front of our industry. We've accomplished this by following our proven way of operating, the Colliers Way, which balances strong internal growth with strategic acquisitions to increase our market share, business model and enterprising culture has allowed us to respond to the challenges and to seize the opportunities while others were running for cover. In fact, during 2020, we completed a total of 4 acquisitions, including 2 of the largest in our history and both are performing better than expected.
In June, we entered the mortgage banking business in a major way with the acquisition of a company we've rebranded as Colliers Mortgage. We now offer real estate lending solutions, especially in the areas of multifamily, healthcare and seniors housing as one of a select few who serve as agency lenders for the U. S. Government. And then In July, we added another substantial business now called Colliers Engineering and Design.
This acquisition established Colliers as a major player in the engineering segment and marks another important step in our strategy to add more highly valued recurring revenue streams to our business. Today, our Outsourcing and Advisory and Investment Management segments represent more than 50% of our revenues and 60% of our adjusted EBITDA up considerably over the past 5 years. The rest comes from transaction services, leasing and capital markets. While volumes in these areas were down versus the prior year, they still delivered much better than anticipated. Let's remember, these are essential services very important to real estate owners and occupiers through all business cycles.
Market dynamics may change from time to time as they did over the last year, but they will return and return strongly when things come back to normal. Colliers not only benefits from being diversified by service line and by asset class, We also benefit from being geographically diverse. About 60% of our revenues comes from the Americas with a balance split between Europe and Asia Pacific. Our global platform and unique decentralized model Empower our leaders to implement key strategic initiatives that drive growth, improve profitability and help them remain focused keenly on our clients and our people. It also enables us to source and complete strategic acquisitions anywhere in the world, especially in times like these when travel or other restrictions Could in fact stand in the way of our progress.
With our proven 26 year track record, Strong balance sheet and significant inside ownership, we have every confidence that Colliers will emerge from this pandemic Stronger than ever as we have done in the past, this confidence is made possible by our strong leadership teams Who have gone above and beyond over the past year. Our professionals are the most enterprising and collaborative in the business, and we continue to safeguard their health and wellness by supporting remote work and safe and open office environments. I'm deeply grateful for the commitment and can do attitude showed by all of our people through this most Challenging year. In addition to health and safety, the pandemic has highlighted the importance of our sustainability strategy related to the environment and society. As leaders, we recognize the need to drive positive impact And we're committed to fostering environmental, social and governance or ESG strategies.
This week, we published our first detailed global impact report to be followed by a responsible impact strategy with measurable goals that will ensure ESG continues to be an integral part of how we do business in the future. Also core to Colliers are technologies that support the productivity and collaboration of our people and tools that deliver the best information and advice to our clients. This year, we challenged our leaders to refocus and reshape our innovation road map for the future. We also continue to partner with our PropTech Accelerator Companies to further develop virtual solutions that help our clients and our people, but also capture Our global brand is another significant competitive advantage. We have worked hard over the years to build the Colliers brand into what it is today, an undisputed leader in our industry.
In February, we launched the new Colliers Visual Identity, a natural evolution of the iconic brand that reaffirms our commitment to accelerating success as we lead our company and our industry into the future, Recognizing the powerful role that our people and our brand play across our organization, I was proud to announce Becky Findley's promotion to the newly created role of Global Chief Brand and People Officer. This is a tribute to her many accomplishments with Colliers, and I'm confident she will continue to differentiate and to strengthen our brand and our people worldwide. I was also pleased to welcome Jane Gavin to our Board of Directors. Jane is a distinguished leader with deep real estate knowledge and more than 30 years of experience in both North American and European Real Estate Opportunities. I have no doubt she will help us advance our strategy and enhance shareholder value for years to come.
To say we achieved a lot over the past year is truly an understatement. I'm deeply thankful to all of our business leaders and our professionals for their enterprising spirit and for their dedication to helping us And now let us hear from Christian Mayer, our Chief Financial Officer. Christian?
Thank you, Jay. As you have heard, Colliers delivered better than anticipated financial results for 2020, Displaying the resilience of our diversified global professional services and investment management operations. In 2020, consolidated revenues were $2,800,000,000 down 9% relative to 2019 in local currency And 16% internally with our transactional revenues, leasing and capital markets impacted significantly by the global pandemic that began in March 2020. Our adjusted EBITDA was $361,000,000 up slightly over the prior year as a result of 1, the positive impact of higher margin acquisitions 2, the natural resilience Our investment management and outsourcing advisory service lines and 3, the various measures we implemented during the year to closely manage our operating costs through the pandemic. We are proud of the way our enterprising employees around the world responded, taking a total of $145,000,000 of costs out of the business.
Finally, adjusted earnings per share of $4.18 was down from $4.67 in the prior year, impacted primarily by income tax and non controlling interest as well as some dilution from the convertible notes offering completed during the year. Since 2015, Colliers has built an excellent Long term record of performance, especially considering the challenging conditions of the past year. Revenues have grown at a compound annual growth rate of 10%. Adjusted EBITDA has grown at a compound rate of 15%, While margins have improved a full 250 basis points from increased scale of operations and the favorable impact of higher margin acquisitions. Adjusted EPS has grown at a compound rate of 13% and Operating cash flow has grown at a compound rate of 14%, while capital expenditures have remained modest, leaving lots of excess cash flow for reinvestment in our growth.
As we look ahead to 2021, we are expecting the impact of the pandemic to subside, although the extent and timing remain uncertain. In our transactional services, we anticipate a rebound in the second half of the year as economies recover and market confidence continues to build. Our recurring investment management and outsourcing and advisory revenues are expected to remain resilient throughout the year. Considering all these factors, our outlook is for 2021 revenues And adjusted EBITDA to each increase between 10% 25% versus the prior year. Looking beyond 2021, we expect to continue our proven capital allocation strategy focused on maximizing shareholder value through reinvestment for internal growth as well as targeting high value add acquisition opportunities that meet our criteria.
We expect to be in a position to publish our next 5 year strategic plan, the Enterprise 2025 Growth Plan in the Q3 of this year. During 2020, we took steps to further strengthen our balance sheet. In the Q2, we completed an offering of 5 year 4% convertible notes for gross proceeds of $230,000,000 These notes are convertible into subordinate voting shares or if not converted, Maybe settled at maturity in shares or cash at the option of Colliers. Based on the current trading price of our shares, the conversion of these notes Into equity is all but assured. Colliers maintains a conservative financial profile with strong cash flow from operations, A capital light operating model and a strong balance sheet that is well positioned for future growth.
At December 31, 2020, our net debt to adjusted EBITDA leverage ratio was 1.0 times, In line with our year end leverage over the past 5 years, but at the low end of our comfort zone of 1.0 to 2.5 times. With low leverage and more than $900,000,000 of available liquidity, including cash on hand, We have ample dry powder for capital deployment for the foreseeable future. Colliers has a long history of creating value for shareholders. We have a 26 year track record, achieving an annualized total shareholder return of about 20% And our future is brighter than ever. Our industry is massive and highly fragmented with compelling growth prospects on a global scale.
And as the events of 2020 have confirmed, our revenues and earnings are increasingly resilient with 51% of revenue And 61 percent of adjusted EBITDA now coming from recurring sources. That concludes my prepared remarks. Thank you. Back to you, Jay.
Thank you, Christian, and thank you to everyone attending this virtual annual meeting. As you've heard, we at Colliers take great pride in building a highly respected and globally diversified company that will continue to grow from strength to strength in the years to come. At Colliers,
Thank you. At this point, we've received no questions. We will accordingly move to terminate today's meeting. On behalf of the company, I thank you all for attending. I would ask that TSX Trust please go ahead and close the meeting.