ANYWHERE REAL ESTATE INC. REPORTS FIRST QUARTER 2024 FINANCIAL RESULTS
"Anywhere continued to demonstrate powerful leadership in the face of a challenging housing market and industry landscape, and our results in the quarter reinforce our ability to execute with discipline and focus while propelling our strategy forward," said
"Anywhere delivered solid results in the first quarter despite a tough market environment," said
First Quarter 2024 Highlights
- Generated Revenue of
$1.1 billion , flat year-over-year, impacted by combined homesale transaction volume increases versus prior year offset by declines in relocation revenue. - This is the first quarter of transaction volume increases in two years. Combined closed transaction volume increased 2% year-over-year in the first quarter with units down about 4% and price up 7%.
- Our strength in luxury continued to outperform with our Sotheby's International Realty brand seeing closed transaction volume up 7% year-over-year with about half of that from unit growth as it again meaningfully outperformed the market and our portfolio.
- Reported Net loss of
$101 million and Adjusted Net Loss of$88 million . - Operating EBITDA loss of
$17 million ,$35 million improvement year-over-year (See Table 5) with March Operating EBITDA solidly positive. - Realized cost savings of approximately
$30 million and on track to deliver at least$100 million for the full year. - Commission splits in the first quarter were down 3 basis points year-over-year, continuing the six-quarter trend of more stable splits.
- Free Cash Flow of negative
$145 million with the first quarter being a seasonal use quarter for the business (See Table 7). - Anywhere was recognized by Fortune's America's Most Innovative Companies list for the second year in a row and was once again named one of the World's Most Ethical Companies for the 13th consecutive year.
First Quarter 2024 Financial Highlights
The following table sets forth the Company's financial highlights for the periods presented (in millions, except per share data) (unaudited):
|
Three Months Ended |
||||||
|
2024 |
|
2023 |
|
Change |
|
% Change |
Revenue |
$ 1,126 |
|
$ 1,131 |
|
$ (5) |
|
— % |
Operating EBITDA 1 |
(17) |
|
(52) |
|
35 |
|
67 |
Net loss attributable to Anywhere |
(101) |
|
(138) |
|
37 |
|
27 |
Adjusted net loss 2 |
(88) |
|
(106) |
|
18 |
|
17 |
Loss per share |
(0.91) |
|
(1.26) |
|
0.35 |
|
28 |
Free Cash Flow 3 |
(145) |
|
(120) |
|
(25) |
|
(21) |
Net cash used in operating activities |
$ (122) |
|
$ (113) |
|
$ (9) |
|
(8) % |
|
|
|
|
|
|
|
|
Select |
|
|
|
|
|
|
|
Anywhere Brands - Franchise Group 4 5 |
|
|
|
|
|
|
|
Closed homesale sides |
144,775 |
|
150,491 |
|
|
|
(4) % |
Average homesale price |
$ 470,119 |
|
$ 437,964 |
|
|
|
7 % |
|
|
|
|
|
|
|
|
Closed homesale sides |
50,513 |
|
53,797 |
|
|
|
(6) % |
Average homesale price |
$ 709,506 |
|
$ 663,223 |
|
|
|
7 % |
Anywhere Integrated Services - |
|
|
|
|
|
|
|
Purchase title and closing units |
21,325 |
|
21,749 |
|
|
|
(2) % |
Refinance title and closing units |
2,025 |
|
2,198 |
|
|
|
(8) % |
_______________ |
|
Footnotes: |
1 See Table 5 for a reconciliation of Net loss attributable to Anywhere to Operating EBITDA. Operating EBITDA is defined as net income (loss) adjusted for depreciation and amortization, interest expense, net (excluding relocation services interest for securitization assets and securitization obligations), income taxes, and certain non-core items. Non-core items include restructuring charges, former parent legacy items, gains or losses on the early extinguishment of debt, impairments, and gains or losses on discontinued operations or the sale of businesses, investments or other assets. |
2 See Table 1a for a reconciliation of Net loss attributable to Anywhere to Adjusted net loss. Adjusted net income (loss) is defined as net income (loss) before mark-to-market interest rate swap adjustments, former parent legacy items, restructuring charges, (gain) loss on the early extinguishment of debt, impairments, (gain) loss on the sale of businesses, investments or other assets and the tax effect of the foregoing adjustments. |
3 See Table 7 for a reconciliation of Net loss attributable to Anywhere to Free Cash Flow. Free Cash Flow is defined as net income (loss) attributable to Anywhere before income tax expense (benefit), income tax payments, net interest expense, cash interest payments, depreciation and amortization, capital expenditures, restructuring costs and former parent legacy costs (benefits), net of payments, impairments, (gain) loss on the sale of businesses, investments or other assets, (gain) loss on the early extinguishment of debt, working capital adjustments and relocation receivables (assets), net of change in securitization obligations. |
4 Includes all franchisees except for |
5 As of |
2024 Financial Estimates
The Company expects to realize cost savings of at least
The Company expects our operating Free Cash Flow excluding one-time items to be modestly positive in 2024 as favorable working capital, robust savings programs, and our cash management discipline will help counterbalance another tough year in housing. And as a reminder, we have over
These estimates are subject to, among other things, macroeconomic and housing market uncertainties, including those related to rising inflation, declining affordability and constrained inventory as well as competitive, litigation and regulatory uncertainties.
Balance Sheet
Total corporate debt, including the short-term portion, net of cash and cash equivalents (net corporate debt), totaled
As of
A consolidated balance sheet is included as Table 2 of this press release.
Investor Conference Call
Today,
Investors may access the conference call live via webcast at ir.anywhere.re or by dialing (800) 715-9871 (toll free); international participants should dial (646) 307-1963. Please dial in at least 5 to 10 minutes prior to start time. A webcast replay also will be available on the website.
About
Forward-Looking Statements
This press release contains "forward-looking statements," within the meaning of the safe harbor provisions of the
Forward-looking statements are neither historical facts nor assurances of future performance. Instead, they are based only on our current beliefs, expectations and assumptions regarding the future of our business, future plans and strategies, projections, anticipated events and trends, the economy and other future conditions. Such forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of
The following include some, but not all, of the factors that could affect our future results and cause actual results to differ materially from those expressed in the forward-looking statements: adverse developments or the absence of sustained improvement in the
Consideration should be given to the areas of risk described above, as well as those risks set forth under the headings "Forward-Looking Statements," "Summary of Risk Factors," "Risk Factors" and "Legal Proceedings" in our filings with the
Non-GAAP Financial Measures
This release includes certain non-GAAP financial measures as defined under
Investor Contacts: |
Media Contacts: |
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(973) 407-4669 |
(973) 407-2162 |
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(973) 407-2612 |
(973) 407-5236 |
Table 1 |
|||
|
|||
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (In millions, except per share data) (Unaudited) |
|||
|
|||
|
Three Months Ended
|
||
|
2024 |
|
2023 |
Revenues |
|
|
|
Gross commission income |
$ 907 |
|
$ 903 |
Service revenue |
119 |
|
127 |
Franchise fees |
70 |
|
69 |
Other |
30 |
|
32 |
Net revenues |
1,126 |
|
1,131 |
Expenses |
|
|
|
Commission and other agent-related costs |
726 |
|
723 |
Operating |
273 |
|
286 |
Marketing |
45 |
|
49 |
General and administrative |
99 |
|
123 |
Former parent legacy cost, net |
1 |
|
16 |
Restructuring costs, net |
11 |
|
25 |
Impairments |
6 |
|
4 |
Depreciation and amortization |
55 |
|
50 |
Interest expense, net |
39 |
|
38 |
Other income, net |
(1) |
|
(1) |
Total expenses |
1,254 |
|
1,313 |
Loss before income taxes, equity in losses and noncontrolling interests |
(128) |
|
(182) |
Income tax benefit |
(28) |
|
(46) |
Equity in losses of unconsolidated entities |
1 |
|
2 |
Net loss |
(101) |
|
(138) |
Less: Net income attributable to noncontrolling interests |
— |
|
— |
Net loss attributable to Anywhere |
$ (101) |
|
$ (138) |
|
|
|
|
Loss per share attributable to Anywhere shareholders: |
|||
Basic loss per share |
$ (0.91) |
|
$ (1.26) |
Diluted loss per share |
$ (0.91) |
|
$ (1.26) |
Weighted average common and common equivalent shares of Anywhere outstanding: |
|||
Basic |
110.7 |
|
109.8 |
Diluted |
110.7 |
|
109.8 |
Table 1a |
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|
|||
NON-GAAP RECONCILIATION ADJUSTED NET INCOME (LOSS) (In millions, except per share data) |
|||
|
|||
Set forth in the table below is a reconciliation of Net loss attributable to Anywhere to Adjusted net loss as defined in Table 9 for the three-month periods ended |
|||
|
|||
|
Three Months Ended |
||
|
2024 |
|
2023 |
Net loss attributable to Anywhere |
$ (101) |
|
$ (138) |
Addback: |
|
|
|
Former parent legacy cost, net (a) |
1 |
|
16 |
Restructuring costs, net |
11 |
|
25 |
Impairments |
6 |
|
4 |
Gain on the sale of businesses, investments or other assets, net |
— |
|
(1) |
Adjustments for tax effect (b) |
(5) |
|
(12) |
Adjusted net loss attributable to Anywhere |
$ (88) |
|
$ (106) |
_______________ |
|
|
|
(a) |
Former parent legacy cost relates to a legacy tax matter. |
(b) |
Reflects tax effect of adjustments at the Company's blended state and federal statutory rate. |
Table 2 |
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|
|||
CONDENSED CONSOLIDATED BALANCE SHEETS (In millions, except share data) (Unaudited) |
|||
|
|||
|
|
|
|
ASSETS |
|
|
|
Current assets: |
|
|
|
Cash and cash equivalents |
$ 111 |
|
$ 106 |
Restricted cash |
4 |
|
13 |
Trade receivables (net of allowance for doubtful accounts of |
109 |
|
105 |
Relocation receivables |
147 |
|
138 |
Other current assets |
226 |
|
218 |
Total current assets |
597 |
|
580 |
Property and equipment, net |
261 |
|
280 |
Operating lease assets, net |
369 |
|
380 |
|
2,499 |
|
2,499 |
Trademarks |
586 |
|
586 |
Franchise agreements, net |
871 |
|
887 |
Other intangibles, net |
122 |
|
127 |
Other non-current assets |
494 |
|
500 |
Total assets |
$ 5,799 |
|
$ 5,839 |
LIABILITIES AND EQUITY |
|
|
|
Current liabilities: |
|
|
|
Accounts payable |
$ 88 |
|
$ 99 |
Securitization obligations |
110 |
|
115 |
Current portion of long-term debt |
639 |
|
307 |
Current portion of operating lease liabilities |
112 |
|
113 |
Accrued expenses and other current liabilities |
526 |
|
573 |
Total current liabilities |
1,475 |
|
1,207 |
Long-term debt |
2,053 |
|
2,235 |
Long-term operating lease liabilities |
325 |
|
333 |
Deferred income taxes |
179 |
|
207 |
Other non-current liabilities |
187 |
|
176 |
Total liabilities |
4,219 |
|
4,158 |
Commitments and contingencies |
|
|
|
Equity: |
|
|
|
Anywhere preferred stock:
outstanding at |
— |
|
— |
Anywhere common stock:
issued and outstanding at December 31, 2023 |
1 |
|
1 |
Additional paid-in capital |
4,814 |
|
4,813 |
Accumulated deficit |
(3,192) |
|
(3,091) |
Accumulated other comprehensive loss |
(45) |
|
(44) |
Total stockholders' equity |
1,578 |
|
1,679 |
Noncontrolling interests |
2 |
|
2 |
Total equity |
1,580 |
|
1,681 |
Total liabilities and equity |
$ 5,799 |
|
$ 5,839 |
Table 3 |
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|
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CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (In millions) (Unaudited) |
|||
|
|||
|
Three Months Ended |
||
|
2024 |
|
2023 |
Operating Activities |
|
|
|
Net loss |
$ (101) |
|
$ (138) |
Adjustments to reconcile net loss to net cash used in operating activities: |
|
|
|
Depreciation and amortization |
55 |
|
50 |
Deferred income taxes |
(28) |
|
(47) |
Impairments |
6 |
|
4 |
Amortization of deferred financing costs and debt premium |
2 |
|
2 |
Gain on the sale of businesses, investments or other assets, net |
— |
|
(1) |
Equity in losses of unconsolidated entities |
1 |
|
2 |
Stock-based compensation |
4 |
|
4 |
Other adjustments to net loss |
(1) |
|
— |
Net change in assets and liabilities, excluding the impact of acquisitions and dispositions: |
|||
Trade receivables |
(5) |
|
52 |
Relocation receivables |
(9) |
|
(26) |
Other assets |
18 |
|
9 |
Accounts payable, accrued expenses and other liabilities |
(60) |
|
(21) |
Dividends received from unconsolidated entities |
— |
|
1 |
Other, net |
(4) |
|
(4) |
Net cash used in operating activities |
(122) |
|
(113) |
Investing Activities |
|
|
|
Property and equipment additions |
(18) |
|
(18) |
Net proceeds from the sale of businesses |
— |
|
6 |
Proceeds from the sale of investments in unconsolidated entities |
— |
|
6 |
Other, net |
2 |
|
1 |
Net cash used in investing activities |
(16) |
|
(5) |
Financing Activities |
|
|
|
Net change in Revolving Credit Facility |
153 |
|
30 |
Amortization payments on term loan facilities |
(5) |
|
(3) |
Net change in securitization obligations |
(5) |
|
11 |
Taxes paid related to net share settlement for stock-based compensation |
(3) |
|
(4) |
Other, net |
(6) |
|
(8) |
Net cash provided by financing activities |
134 |
|
26 |
Effect of changes in exchange rates on cash, cash equivalents and restricted cash |
— |
|
— |
Net decrease in cash, cash equivalents and restricted cash |
(4) |
|
(92) |
Cash, cash equivalents and restricted cash, beginning of period |
119 |
|
218 |
Cash, cash equivalents and restricted cash, end of period |
$ 115 |
|
$ 126 |
|
|
|
|
Supplemental Disclosure of Cash Flow Information |
|
|
|
Interest payments (including securitization interest of |
$ 31 |
|
$ 39 |
Income tax (refunds) payments, net |
(1) |
|
1 |
Table 4a |
|||||
|
|||||
2024 vs. 2023 KEY DRIVERS |
|||||
|
|||||
|
Three Months Ended |
||||
|
2024 |
|
2023 |
|
% Change |
Anywhere Brands - Franchise Group (a) |
|
|
|
|
|
Closed homesale sides |
144,775 |
|
150,491 |
|
(4) % |
Average homesale price |
|
|
|
|
7 % |
Average homesale broker commission rate |
2.43 % |
|
2.46 % |
|
(3) bps |
Net royalty per side |
$ 417 |
|
$ 392 |
|
6 % |
|
|
|
|
|
|
Closed homesale sides |
50,513 |
|
53,797 |
|
(6) % |
Average homesale price |
|
|
|
|
7 % |
Average homesale broker commission rate |
2.41 % |
|
2.41 % |
|
— bps |
Gross commission income per side |
$ 17,946 |
|
$ 16,776 |
|
7 % |
Anywhere Integrated Services - |
|
|
|
|
|
Purchase title and closing units |
21,325 |
|
21,749 |
|
(2) % |
Refinance title and closing units |
2,025 |
|
2,198 |
|
(8) % |
Average fee per closing unit |
$ 3,208 |
|
$ 3,129 |
|
3 % |
_______________ |
|
|
|
(a) |
Includes all franchisees except for |
Table 4b |
|||||||||
|
|||||||||
2023 |
|||||||||
|
|||||||||
|
Quarter Ended |
Year Ended |
|||||||
|
|
|
|
|
|
|
|
|
|
Anywhere Brands - Franchise Group (a) |
|
|
|
|
|
|
|
|
|
Closed homesale sides |
150,491 |
|
203,928 |
|
200,619 |
|
165,815 |
|
720,853 |
Average homesale price |
|
|
|
|
|
|
|
|
|
Average homesale broker commission rate |
2.46 % |
|
2.46 % |
|
2.45 % |
|
2.45 % |
|
2.45 % |
Net royalty per side |
$ 392 |
|
$ 451 |
|
$ 442 |
|
$ 429 |
|
$ 431 |
|
|
|
|
|
|
|
|
|
|
Closed homesale sides |
53,797 |
|
75,506 |
|
71,794 |
|
57,546 |
|
258,643 |
Average homesale price |
|
|
|
|
|
|
|
|
|
Average homesale broker commission rate |
2.41 % |
|
2.43 % |
|
2.41 % |
|
2.42 % |
|
2.42 % |
Gross commission income per side |
$ 16,776 |
|
$ 18,059 |
|
$ 18,013 |
|
$ 17,558 |
|
$ 17,668 |
Anywhere Integrated Services - |
|
|
|
|
|
|
|
|
|
Purchase title and closing units |
21,749 |
|
30,136 |
|
28,453 |
|
22,629 |
|
102,967 |
Refinance title and closing units |
2,198 |
|
2,308 |
|
2,304 |
|
2,040 |
|
8,850 |
Average fee per closing unit |
$ 3,129 |
|
$ 3,202 |
|
$ 3,187 |
|
$ 3,216 |
|
$ 3,185 |
_______________ |
|
|
|
(a) |
Includes all franchisees except for |
Table 5 |
|||
|
|||
NON-GAAP RECONCILIATION - OPERATING EBITDA
THREE MONTHS ENDED (In millions) |
|||
|
|||
Set forth in the table below is a reconciliation of Net loss attributable to Anywhere to Operating EBITDA as defined in Table 9 for the three-month periods ended |
|||
|
|||
|
Three Months Ended |
||
|
2024 |
|
2023 |
Net loss attributable to Anywhere |
$ (101) |
|
$ (138) |
Income tax benefit |
(28) |
|
(46) |
Loss before income taxes |
(129) |
|
(184) |
Add: Depreciation and amortization |
55 |
|
50 |
Interest expense, net |
39 |
|
38 |
Restructuring costs, net (a) |
11 |
|
25 |
Impairments (b) |
6 |
|
4 |
Former parent legacy cost, net (c) |
1 |
|
16 |
Gain on the sale of businesses, investments or other assets, net |
— |
|
(1) |
Operating EBITDA |
$ (17) |
|
$ (52) |
The following table reflects Revenue, Operating EBITDA and Operating EBITDA margin, both as defined in Table 9, by reportable segments: |
|||||||||||||||||||||
|
|||||||||||||||||||||
|
Revenues (d) |
|
$ Change |
|
% Change |
|
Operating EBITDA |
|
$ Change |
|
% Change |
|
Operating EBITDA Margin |
|
Change |
||||||
|
2024 |
|
2023 |
|
|
|
2024 |
|
2023 |
|
|
|
2024 |
|
2023 |
|
|||||
Franchise Group |
$ 200 |
|
$ 207 |
|
$ (7) |
|
(3) % |
|
$ 89 |
|
$ 97 |
|
$ (8) |
|
(8) % |
|
45 % |
|
47 % |
|
(2) |
|
919 |
|
915 |
|
4 |
|
— |
|
(59) |
|
(75) |
|
16 |
|
21 |
|
(6) |
|
(8) |
|
2 |
|
71 |
|
72 |
|
(1) |
|
(1) |
|
(15) |
|
(17) |
|
2 |
|
12 |
|
(21) |
|
(24) |
|
3 |
Corporate and Other |
(64) |
|
(63) |
|
(1) |
|
(d) |
|
(32) |
|
(57) |
|
25 |
|
44 |
|
|
|
|
|
|
|
$ 1,126 |
|
$ 1,131 |
|
$ (5) |
|
— % |
|
$ (17) |
|
$ (52) |
|
$ 35 |
|
67 % |
|
(2) % |
|
(5) % |
|
3 |
_______________ |
|
|
|
(a) |
Restructuring charges incurred for the three months ended |
(b) |
Non-cash impairments primarily related to leases and other assets. |
(c) |
Former parent legacy cost is recorded in Corporate and Other and relates to a legacy tax matter. |
(d) |
Revenues include the elimination of transactions between segments, which consists of intercompany royalties and marketing fees paid by |
Table 6a |
|
|
|
SELECTED 2024 FINANCIAL DATA (In millions) |
|
|
|
|
Three Months Ended |
|
|
Net revenues (a) |
|
Franchise Group |
$ 200 |
|
919 |
|
71 |
Corporate and Other |
(64) |
|
$ 1,126 |
|
|
Operating EBITDA |
|
Franchise Group |
$ 89 |
|
(59) |
|
(15) |
Corporate and Other |
(32) |
|
$ (17) |
|
|
Non-GAAP Reconciliation - Operating EBITDA |
|
Total Company Operating EBITDA |
$ (17) |
|
|
Less: Depreciation and amortization |
55 |
Interest expense, net |
39 |
Income tax benefit |
(28) |
Restructuring costs, net (b) |
11 |
Impairments (c) |
6 |
Former parent legacy cost, net (d) |
1 |
Net loss attributable to Anywhere |
$ (101) |
_______________ |
|
|
|
(a) |
Transactions between segments are eliminated in consolidation. Revenues for Franchise Group include intercompany royalties and marketing fees paid by |
(b) |
Includes restructuring charges broken down by business unit as follows: |
|
|
|
Three Months Ended |
|
|
Franchise Group |
$ 1 |
|
6 |
Corporate and Other |
4 |
|
$ 11 |
|
|
(c) |
Non-cash impairments primarily related to leases and other assets. |
(d) |
Former parent legacy cost is recorded in Corporate and Other and relates to a legacy tax matter. |
Table 6b |
|||||||||
|
|||||||||
SELECTED 2023 FINANCIAL DATA (In millions) |
|||||||||
|
|||||||||
|
Three Months Ended |
|
Year Ended |
||||||
|
|
|
|
|
|
|
|
|
|
|
2023 |
|
2023 |
|
2023 |
|
2023 |
|
2023 |
Net revenues (a) |
|
|
|
|
|
|
|
|
|
Franchise Group |
$ 207 |
|
$ 284 |
|
$ 271 |
|
$ 221 |
|
$ 983 |
|
915 |
|
1,380 |
|
1,309 |
|
1,024 |
|
4,628 |
|
72 |
|
100 |
|
93 |
|
75 |
|
340 |
Corporate and Other |
(63) |
|
(93) |
|
(89) |
|
(70) |
|
(315) |
|
$ 1,131 |
|
$ 1,671 |
|
$ 1,584 |
|
$ 1,250 |
|
$ 5,636 |
|
|
|
|
|
|
|
|
|
|
Operating EBITDA |
|
|
|
|
|
|
|
|
|
Franchise Group |
$ 97 |
|
$ 164 |
|
$ 155 |
|
$ 111 |
|
$ 527 |
|
(75) |
|
(10) |
|
(8) |
|
(51) |
|
(144) |
|
(17) |
|
10 |
|
2 |
|
(12) |
|
(17) |
Corporate and Other |
(57) |
|
(38) |
|
(42) |
|
(29) |
|
(166) |
|
$ (52) |
|
$ 126 |
|
$ 107 |
|
$ 19 |
|
$ 200 |
|
|
|
|
|
|
|
|
|
|
Non-GAAP Reconciliation - Operating EBITDA |
|
|
|
|
|
|
|
|
|
Total Company Operating EBITDA |
$ (52) |
|
$ 126 |
|
$ 107 |
|
$ 19 |
|
$ 200 |
|
|
|
|
|
|
|
|
|
|
Less: Depreciation and amortization |
50 |
|
49 |
|
50 |
|
47 |
|
196 |
Interest expense, net |
38 |
|
39 |
|
37 |
|
37 |
|
151 |
Income tax (benefit) expense |
(46) |
|
8 |
|
45 |
|
(22) |
|
(15) |
Restructuring costs, net (b) |
25 |
|
6 |
|
9 |
|
9 |
|
49 |
Impairments (c) |
4 |
|
4 |
|
3 |
|
54 |
|
65 |
Former parent legacy cost, net (d) |
16 |
|
1 |
|
— |
|
1 |
|
18 |
Gain on the early extinguishment of debt (d) |
— |
|
— |
|
(169) |
|
— |
|
(169) |
(Gain) loss on the sale of businesses, investments or other assets, net |
(1) |
|
— |
|
3 |
|
— |
|
2 |
Net (loss) income attributable to Anywhere |
$ (138) |
|
$ 19 |
|
$ 129 |
|
$ (107) |
|
$ (97) |
_______________ |
|
|
|
(a) |
Transactions between segments are eliminated in consolidation. Revenues for Franchise Group include intercompany royalties and marketing fees paid by |
(b) |
Includes restructuring charges broken down by business unit as follows: |
|
|
|
Three Months Ended |
|
Year Ended |
||||||
|
|
|
|
|
|
|
|
|
|
|
2023 |
|
2023 |
|
2023 |
|
2023 |
|
2023 |
Franchise Group |
$ 6 |
|
$ — |
|
$ 2 |
|
$ 3 |
|
$ 11 |
|
14 |
|
4 |
|
5 |
|
2 |
|
25 |
|
— |
|
1 |
|
1 |
|
2 |
|
4 |
Corporate and Other |
5 |
|
1 |
|
1 |
|
2 |
|
9 |
|
$ 25 |
|
$ 6 |
|
$ 9 |
|
$ 9 |
|
$ 49 |
|
|
(c) |
Impairments for the three months ended |
(d) |
Former parent legacy cost and Gain on the early extinguishment of debt are recorded in Corporate and Other. Former parent legacy cost relates to a legacy tax matter. Gain on the early extinguishment of debt relates to the debt exchange transactions and open market repurchases that occurred during the third quarter of 2023. |
Table 6c |
|||||||||
|
|||||||||
2023 CONSOLIDATED STATEMENTS OF OPERATIONS (In millions, except per share data) |
|||||||||
|
|||||||||
|
Three Months Ended |
|
Year Ended |
||||||
|
|
|
|
|
|
|
|
|
|
|
2023 |
|
2023 |
|
2023 |
|
2023 |
|
2023 |
Revenues |
|
|
|
|
|
|
|
|
|
Gross commission income |
$ 903 |
|
|
|
$ 1,293 |
|
$ 1,011 |
|
$ 4,570 |
Service revenue |
127 |
|
163 |
|
155 |
|
124 |
|
569 |
Franchise fees |
69 |
|
102 |
|
99 |
|
81 |
|
351 |
Other |
32 |
|
43 |
|
37 |
|
34 |
|
146 |
Net revenues |
1,131 |
|
1,671 |
|
1,584 |
|
1,250 |
|
5,636 |
Expenses |
|
|
|
|
|
|
|
|
|
Commission and other agent-related costs |
723 |
|
1,092 |
|
1,037 |
|
812 |
|
3,664 |
Operating |
286 |
|
299 |
|
284 |
|
278 |
|
1,147 |
Marketing |
49 |
|
56 |
|
56 |
|
54 |
|
215 |
General and administrative |
123 |
|
104 |
|
104 |
|
91 |
|
422 |
Former parent legacy cost, net |
16 |
|
1 |
|
— |
|
1 |
|
18 |
Restructuring costs, net |
25 |
|
6 |
|
9 |
|
9 |
|
49 |
Impairments |
4 |
|
4 |
|
3 |
|
54 |
|
65 |
Depreciation and amortization |
50 |
|
49 |
|
50 |
|
47 |
|
196 |
Interest expense, net |
38 |
|
39 |
|
37 |
|
37 |
|
151 |
Gain on the early extinguishment of debt |
— |
|
— |
|
(169) |
|
— |
|
(169) |
Other (income) expense, net |
(1) |
|
(1) |
|
3 |
|
(1) |
|
— |
Total expenses |
1,313 |
|
1,649 |
|
1,414 |
|
1,382 |
|
5,758 |
(Loss) income before income taxes, equity in losses (earnings) and noncontrolling interests |
(182) |
|
22 |
|
170 |
|
(132) |
|
(122) |
Income tax (benefit) expense |
(46) |
|
8 |
|
45 |
|
(22) |
|
(15) |
Equity in losses (earnings) of unconsolidated entities |
2 |
|
(5) |
|
(4) |
|
(2) |
|
(9) |
Net (loss) income |
(138) |
|
19 |
|
129 |
|
(108) |
|
(98) |
Less: Net loss attributable to noncontrolling interests |
— |
|
— |
|
— |
|
1 |
|
1 |
Net (loss) income attributable to Anywhere |
$ (138) |
|
$ 19 |
|
$ 129 |
|
$ (107) |
|
$ (97) |
|
|
|
|
|
|
|
|
|
|
(Loss) earnings per share attributable to Anywhere shareholders: |
|
|
|||||||
Basic (loss) earnings per share |
$ (1.26) |
|
$ 0.17 |
|
$ 1.17 |
|
$ (0.97) |
|
$ (0.88) |
Diluted (loss) earnings per share |
$ (1.26) |
|
$ 0.17 |
|
$ 1.15 |
|
$ (0.97) |
|
$ (0.88) |
Weighted average common and common equivalent shares of Anywhere outstanding: |
|
|
|||||||
Basic |
109.8 |
|
110.4 |
|
110.5 |
|
110.5 |
|
110.3 |
Diluted |
109.8 |
|
111.3 |
|
112.1 |
|
110.5 |
|
110.3 |
Table 7 |
|||
|
|||
NON-GAAP RECONCILIATION - FREE CASH FLOW
THREE MONTHS ENDED (In millions) |
|||
|
|||
A reconciliation of Net loss attributable to Anywhere to Free Cash Flow as defined in Table 9 is set forth in the following table: |
|||
|
|||
|
Three Months Ended |
||
|
2024 |
|
2023 |
Net loss attributable to Anywhere |
$ (101) |
|
$ (138) |
Income tax benefit |
(28) |
|
(46) |
Income tax refunds (payments) |
1 |
|
(1) |
Interest expense, net |
39 |
|
38 |
Cash interest payments |
(31) |
|
(39) |
Depreciation and amortization |
55 |
|
50 |
Capital expenditures |
(18) |
|
(18) |
Restructuring costs and former parent legacy items, net of payments |
4 |
|
29 |
Impairments |
6 |
|
4 |
Gain on the sale of businesses, investments or other assets, net |
— |
|
(1) |
Working capital adjustments |
(58) |
|
17 |
Relocation receivables (assets), net of securitization obligations |
(14) |
|
(15) |
Free Cash Flow |
$ (145) |
|
$ (120) |
|
|||
A reconciliation of Net cash used in operating activities to Free Cash Flow is set forth in the following table: |
|||
|
|||
|
Three Months Ended |
||
|
2024 |
|
2023 |
Net cash used in operating activities |
$ (122) |
|
$ (113) |
Property and equipment additions |
(18) |
|
(18) |
Net change in securitization obligations |
(5) |
|
11 |
Effect of exchange rates on cash, cash equivalents and restricted cash |
— |
|
— |
Free Cash Flow |
$ (145) |
|
$ (120) |
|
|
|
|
Net cash used in investing activities |
$ (16) |
|
$ (5) |
Net cash provided by financing activities |
$ 134 |
|
$ 26 |
Table 8a |
|
NON-GAAP RECONCILIATION - SENIOR SECURED LEVERAGE RATIO
|
|
The senior secured leverage ratio is tested quarterly pursuant to the terms of the senior secured credit facilities*. For the trailing four-quarter period ended |
|
A reconciliation of Net loss attributable to |
|
|
Four-Quarter Period Ended |
|
|
Net loss attributable to |
$ (60) |
Bank covenant adjustments: |
|
Income tax expense |
3 |
Depreciation and amortization |
201 |
Interest expense, net |
152 |
Restructuring costs, net |
35 |
Impairments |
67 |
Former parent legacy cost, net |
3 |
Gain on the early extinguishment of debt |
(169) |
Pro forma effect of business optimization initiatives (b) |
30 |
Non-cash stock compensation expense, other non-cash charges and extraordinary, nonrecurring or unusual charges (c) |
49 |
Pro forma effect of acquisitions and new franchisees (d) |
1 |
Incremental securitization interest costs (e) |
11 |
EBITDA as defined by the Senior Secured Credit Agreement* |
$ 323 |
Total senior secured net debt (f) |
$ 573 |
Senior secured leverage ratio* |
1.77 x |
_______________ |
|
|
|
(a) |
Net loss attributable to |
(b) |
Represents the four-quarter pro forma effect of business optimization initiatives. |
(c) |
Represents non-cash long term incentive compensation charges, other non-cash charges and extraordinary, nonrecurring or unusual litigation charges. |
(d) |
Represents the estimated impact of acquisitions and franchise sales activity, net of brokerages that exited our franchise system, as if these changes had occurred at the beginning of the trailing twelve-month period. Franchisee sales activity is comprised of new franchise agreements as well as growth through acquisitions and independent sales agent recruitment by existing franchisees with our assistance. We have made a number of assumptions in calculating such estimates and there can be no assurance that we would have generated the projected levels of Operating EBITDA had we owned the acquired entities or entered into the franchise contracts as of the beginning of the trailing twelve-month period. |
(e) |
Incremental borrowing costs incurred as a result of the securitization facilities refinancing for the four-quarter period ended |
(f) |
Represents total borrowings secured by a first priority lien on our assets of |
|
|
* |
Our senior secured credit facilities include the facilities under our Amended and Restated Credit Agreement dated as of |
Table 8b |
||
|
||
NET DEBT LEVERAGE RATIO
FOR THE FOUR-QUARTER PERIOD ENDED (In millions) |
||
|
||
Net corporate debt (excluding securitizations) divided by EBITDA calculated on a Pro Forma Basis, as those terms are defined
in the Senior Secured Credit Agreement, for the four-quarter period ended is set forth in the following table: |
||
|
||
|
|
As of |
Revolving Credit Facility |
|
$ 438 |
Term Loan A Facility |
|
202 |
7.00% Senior Secured Second Lien Notes |
|
640 |
5.75% Senior Notes |
|
576 |
5.25% Senior Notes |
|
457 |
0.25% Exchangeable Senior Notes |
|
403 |
Finance lease obligations |
|
21 |
Corporate Debt (excluding securitizations) |
|
2,737 |
Less: Cash and cash equivalents |
|
111 |
Net Corporate Debt (excluding securitizations) |
|
$ 2,626 |
|
|
|
EBITDA as defined by the Senior Secured Credit Agreement (a) |
|
$ 323 |
|
|
|
Net Debt Leverage Ratio (b) |
|
8.1 x |
_______________ |
|
|
|
(a) |
See Table 8a for a reconciliation of Net loss attributable to |
(b) |
Net Debt Leverage Ratio is substantially similar to Consolidated Leverage Ratio (as defined under the indentures governing the Unsecured Notes and the 7.00% Senior Secured Second Lien Notes), except that under the indentures when the Consolidated Leverage Ratio is measured at |
Table 9
Non-GAAP Definitions
Adjusted net income (loss) is defined by us as net income (loss) before: (a) mark-to-market interest rate swap adjustments; (b) former parent legacy items, which pertain to liabilities of the former parent for matters prior to mid-2006 and are non-operational in nature; (c) restructuring charges as a result of initiatives currently in progress; (d) impairments; (e) the (gain) loss on the early extinguishment of debt that results from refinancing and deleveraging debt initiatives; (f) the (gain) loss on the sale of businesses, investments or other assets and (g) the tax effect of the foregoing adjustments. We present Adjusted net income (loss) because we believe this measure is useful as a supplemental measure in evaluating the performance of our operating businesses and provides greater transparency into our operating results.
Operating EBITDA is defined as net income (loss) adjusted for depreciation and amortization, interest expense, net (excluding relocation services interest for securitization assets and securitization obligations), income taxes, and certain non-core items. Non-core items include restructuring charges, former parent legacy items, gains or losses on the early extinguishment of debt, impairments, and gains or losses on discontinued operations or the sale of businesses, investments or other assets. Operating EBITDA is our primary non-GAAP measure. Operating EBITDA Margin is defined as Operating EBITDA as a percentage of revenues.
We present Operating EBITDA because we believe it is useful as a supplemental measure in evaluating the performance of our operating businesses and provides greater transparency into our results of operations. Our management, including our chief operating decision maker, uses Operating EBITDA as a factor in evaluating the performance of our business. Operating EBITDA should not be considered in isolation or as a substitute for net income or other statement of operations data prepared in accordance with GAAP.
We believe Operating EBITDA facilitates company-to-company operating performance comparisons by backing out potential differences caused by variations in capital structures (affecting net interest expense), taxation, the age and book depreciation of facilities (affecting relative depreciation expense) and the amortization of intangibles, as well as other items that are not core to the operating activities of the Company such as restructuring charges, gains or losses on the early extinguishment of debt, former parent legacy items, impairments, gains or losses on discontinued operations and gains or losses on the sale of businesses, investments or other assets, which may vary for different companies for reasons unrelated to operating performance. We further believe that Operating EBITDA is frequently used by securities analysts, investors and other interested parties in their evaluation of companies, many of which present an Operating EBITDA measure when reporting their results.
Operating EBITDA has limitations as an analytical tool, and you should not consider Operating EBITDA either in isolation or as a substitute for analyzing our results as reported under GAAP. Some of these limitations are:
- this measure does not reflect changes in, or cash required for, our working capital needs;
- this measure does not reflect our interest expense (except for interest related to our securitization obligations), or the cash requirements necessary to service interest or principal payments on our debt;
- this measure does not reflect our income tax expense or the cash requirements to pay our taxes;
- this measure does not reflect historical cash expenditures or future requirements for capital expenditures or contractual commitments;
- although depreciation and amortization are non-cash charges, the assets being depreciated and amortized will often require replacement in the future, and this measure does not reflect any cash requirements for such replacements; and
- other companies may calculate this measure differently so they may not be comparable.
Free Cash Flow is defined as net income (loss) attributable to Anywhere before income tax expense (benefit), income tax payments, interest expense, net, cash interest payments, depreciation and amortization, capital expenditures, restructuring costs and former parent legacy costs (benefits), net of payments, impairments, (gain) loss on the sale of businesses, investments or other assets, (gain) loss on the early extinguishment of debt, working capital adjustments and relocation receivables (assets), net of change in securitization obligations. We use Free Cash Flow in our internal evaluation of operating effectiveness and decisions regarding the allocation of resources, as well as measuring the Company's ability to generate cash. Since Free Cash Flow can be viewed as both a performance measure and a cash flow measure, the Company has provided a reconciliation to both net income attributable to Anywhere and net cash provided by operating activities. Free Cash Flow is not defined by GAAP and should not be considered in isolation or as an alternative to net income (loss), net cash provided by (used in) operating, investing and financing activities or other financial data prepared in accordance with GAAP or as an indicator of the Company's operating performance or liquidity. Free Cash Flow may differ from similarly titled measures presented by other companies.
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