Realogy Holdings Corp., a global leader in residential real estate franchising and provider of real estate brokerage, relocation, and title and settlement services, recently reported financial results for the quarter ended March 31, 2014, including the following highlights:
• Realogy’s net revenue for first quarter 2014 was $1.0 billion, a 5 percent increase compared to first quarter of 2013.
• Realogy’s Adjusted EBITDA for first quarter 2014 was $53 million, down from $71 million in the first quarter of 2013, primarily due to an approximately $20 million reduction in earnings related to the decrease in refinancing activity at our mortgage origination joint venture and within the Company’s title and settlement services segment.
• Net loss for first quarter 2014 was $46 million, which includes $70 million of interest expense, $46 million of depreciation and amortization expense and $10 million in pre-tax charges related to the repricing of its term loan and repurchases of $44 million of senior secured notes during the quarter.
• Realogy reduced its annualized run-rate corporate cash interest expense to approximately $215 million with the completion of its term loan repricing and other refinancing actions completed to date in 2014.
• Realogy has reduced its outstanding senior secured notes by $398 million this year, and intends to use remaining net proceeds of its April debt offering as well as free cash flow to continue to retire high-cost debt.
“Realogy achieved homesale transaction volume growth of 10 percent year-over-year in the first quarter, which is at the midpoint of our prior guidance range,” says Richard A. Smith, Realogy’s chairman, chief executive officer and president. “Our volume growth was driven by a 13 percent increase in average sales price that was partially offset by a 3 percent decline in transaction sides. We saw two opposing trends in the first quarter that caused an overall shift in Realogy’s mix of business resulting in a higher average sale price and reduced transaction sides. Demand at the higher price points in markets served by our franchisees and company-owned brokerages was strong, while difficult credit standards and rapid home price appreciation, primarily caused by low inventory levels, constrained activity at the entry level of the housing market.”