Realogy recently reported financial results for the quarter ended September 30, 2013, including the following highlights:
- Realogy’s net revenue for the third quarter 2013 was $1.55 billion, a 21% increase compared to the same period in 2012.
- The Company’s Adjusted EBITDA(1) was $286 million for the third quarter, an increase of 27 percent year-over-year.
- Adjusted net income(2) for the third quarter was $150 million.
- GAAP net income was $109 million for the third quarter, and includes $22 million of debt extinguishment charges and $19 million of compensation expense relating to the issuance of stock under the phantom value plan that was funded as a result of a secondary equity offering completed during the quarter.
- Adjusted earnings per share(2) was $1.03 for the third quarter, with a weighted average of 145.6 million shares outstanding for the quarter.
- GAAP basic earnings per share was $0.75 for the third quarter.
- Realogy free cash flow(1) totaled $200 million in the third quarter alone. This was due primarily to the strong gains in operations and lower interest expense (see Table 8 for reconciliation).
- The Company repurchased $100 million of 9.00% notes during the quarter, which reduces our annualized run-rate cash interest expense to approximately $240 million and decreased net debt to trailing 12-month Adjusted EBITDA leverage ratio to 4.7 times as of September 30, 2013.
“We had an outstanding third quarter,” says Richard A. Smith, Realogy’s chairman, chief executive officer and president. “Our 29 percent increase in year-over-year homesale transaction volume exceeded the 26 percent sales volume increase reported by the National Association of REALTORS®. While industry observers anticipated that the mortgage rate environment would slow the housing recovery, we now believe the exact opposite occurred — it accelerated. In our view, the strong volume increase was driven by a combination of pent-up demand, relatively low inventory and a shift in homebuyer preference to purchase existing homes over new homes due to the ability to lock in mortgage rates for the shorter period it takes to close on an existing home purchase over a new home.”