Altisource Announces Second Quarter 2024 Financial Results
Altisource Portfolio Solutions S.A. (NASDAQ: ASPS) reported strong second quarter 2024 financial results, with service revenue of $36.9 million, up 11% year-over-year. The company achieved Adjusted EBITDA of $4.4 million, a significant improvement from the $(3.5) million loss in Q2 2023. Gross profit margin increased to 34.0% from 16.7% in the same quarter last year.
Despite challenging market conditions, including low mortgage delinquency rates and origination volumes, Altisource generated sales wins with potential annualized revenue of $15.3 million for the Servicer and Real Estate segment and $1.5 million for the Origination segment. The company maintains a strong sales pipeline and ended the quarter with $29.7 million in cash and cash equivalents.
Altisource remains on track to achieve its 2024 guidance of 13% to 32% service revenue growth and Adjusted EBITDA between $17.5 million and $22.5 million, representing a potential $21 million improvement over 2023.
Altisource Portfolio Solutions S.A. (NASDAQ: ASPS) ha riportato risultati finanziari forti per il secondo trimestre del 2024, con ricavi da servizi di $36,9 milioni, in aumento dell'11% rispetto all'anno precedente. L'azienda ha registrato un EBITDA aggiustato di $4,4 milioni, un miglioramento significativo rispetto alla perdita di $(3,5) milioni del Q2 2023. Il margine di profitto lordo è aumentato al 34,0% rispetto al 16,7% dello stesso trimestre dell'anno scorso.
Nonostante le condizioni di mercato difficili, tra cui bassi tassi di insolvenza sui mutui e volumi di origine, Altisource ha generato vincite nelle vendite con un potenziale fatturato annualizzato di $15,3 milioni per il segmento Servicer e Immobiliare e $1,5 milioni per il segmento Origination. L'azienda mantiene un forte pipeline di vendite e ha chiuso il trimestre con $29,7 milioni in cassa e equivalenti.
Altisource è sulla buona strada per raggiungere le previsioni del 2024 di una crescita dei ricavi da servizi tra il 13% e il 32% e un EBITDA aggiustato tra $17,5 milioni e $22,5 milioni, rappresentando un potenziale miglioramento di $21 milioni rispetto al 2023.
Altisource Portfolio Solutions S.A. (NASDAQ: ASPS) informó sobre resultados financieros sólidos en el segundo trimestre de 2024, con ingresos por servicios de $36,9 millones, un aumento del 11% en comparación con el año anterior. La compañía logró un EBITDA ajustado de $4,4 millones, una mejora significativa respecto a la pérdida de $(3,5) millones en el Q2 2023. El margen de beneficio bruto se incrementó al 34,0% desde el 16,7% en el mismo trimestre del año pasado.
A pesar de las desafiantes condiciones del mercado, que incluyen bajas tasas de morosidad hipotecaria y volúmenes de originación, Altisource generó ganancias en ventas con un potencial de ingresos anuales de $15,3 millones para el segmento de Servidor y Bienes Raíces y $1,5 millones para el segmento de Originación. La compañía mantiene un sólido pipeline de ventas y terminó el trimestre con $29,7 millones en efectivo y equivalentes.
Altisource sigue en camino de alcanzar su guía de 2024 de un crecimiento de ingresos por servicios entre el 13% y el 32% y un EBITDA ajustado entre $17,5 millones y $22,5 millones, lo que representa una mejora potencial de $21 millones con respecto a 2023.
Altisource Portfolio Solutions S.A. (NASDAQ: ASPS)는 2024년 2분기 재정 결과를 강하게 보고했으며 서비스 수익은 3,690만 달러로 전년 대비 11% 증가했습니다. 이 회사는 조정된 EBITDA가 440만 달러에 도달했으며, 이는 2023년 2분기에서의 (350만 달러) 손실에 비해 상당한 개선을 보여줍니다. 총 이익률은 지난해 같은 분기 16.7%에서 34.0%로 증가했습니다.
낮은 모기지 연체율과 발급량 등 어려운 시장 상황에도 불구하고 Altisource는 Servicer 및 부동산 부문에서 연간 수익이 1,530만 달러 잠재력을 가진 판매 성과를 올렸으며, 원산지 부문에서는 150만 달러를 기록했습니다. 이 회사는 강력한 판매 파이프라인을 유지하며 분기를 종료할 때 2,970만 달러의 현금 및 현금 등가물을 보유하고 있었습니다.
Altisource는 2024년 서비스 수익 성장 전망이 13%에서 32% 사이에 이를 것으로 보이며 조정된 EBITDA는 1,750만 달러에서 2,250만 달러 사이에서 이루어져 2023년 대비 2,100만 달러의 개선을 나타낼 것입니다.
Altisource Portfolio Solutions S.A. (NASDAQ: ASPS) a annoncé des résultats financiers solides pour le deuxième trimestre 2024, avec des revenus de services s'élevant à 36,9 millions de dollars, en hausse de 11% par rapport à l'année précédente. L'entreprise a atteint un EBITDA ajusté de 4,4 millions de dollars, une amélioration significative par rapport à la perte de $(3,5) millions au T2 2023. La marge bénéficiaire brute a augmenté à 34,0% contre 16,7% au même trimestre l'année dernière.
Malgré des conditions de marché difficiles, y compris de faibles taux de délinquance hypothécaire et volumes d'origine, Altisource a généré des gains de ventes avec des revenus annuels potentiels de 15,3 millions de dollars pour le segment Servicer et Immobilier et de 1,5 million de dollars pour le segment Origination. La société maintient un fort pipeline de ventes et a terminé le trimestre avec 29,7 millions de dollars en espèces et équivalents.
Altisource reste sur la bonne voie pour atteindre sa prévision 2024 d'une croissance des revenus de services de 13% à 32% et un EBITDA ajusté compris entre 17,5 millions et 22,5 millions de dollars, représentant une amélioration potentielle de 21 millions de dollars par rapport à 2023.
Altisource Portfolio Solutions S.A. (NASDAQ: ASPS) berichtete über starke finanzielle Ergebnisse im zweiten Quartal 2024, mit Serviceeinnahmen von 36,9 Millionen Dollar, was einem Anstieg von 11% im Vergleich zum Vorjahr entspricht. Das Unternehmen erzielte ein bereinigtes EBITDA von 4,4 Millionen Dollar, was eine deutliche Verbesserung gegenüber dem Verlust von (3,5) Millionen Dollar im Q2 2023 darstellt. Die Bruttogewinnmarge stieg von 16,7% im gleichen Quartal des Vorjahres auf 34,0%.
Trotz schwieriger Marktbedingungen, einschließlich niedriger Moratoriumsquoten und Ursprungsvolumen, konnte Altisource Verkaufsgewinne mit potenziellen jährlichen Einnahmen von 15,3 Millionen Dollar für den Bereich Servicer und Immobilien sowie 1,5 Millionen Dollar für den Bereich Origination generieren. Das Unternehmen hat eine starke Verkaufspipeline und schloss das Quartal mit 29,7 Millionen Dollar in Bargeld und Zahlungsmitteln ab.
Altisource bleibt auf Kurs, um die Prognose für 2024 von 13% bis 32% Wachstum der Serviceeinnahmen und bereinigtem EBITDA zwischen 17,5 Millionen und 22,5 Millionen Dollar zu erreichen, was eine potenzielle Verbesserung von 21 Millionen Dollar gegenüber 2023 darstellt.
- Service revenue increased by 11% year-over-year to $36.9 million
- Adjusted EBITDA improved to $4.4 million from $(3.5) million loss in Q2 2023
- Gross profit margin increased to 34.0% from 16.7% in Q2 2023
- Generated sales wins with potential annualized revenue of $16.8 million
- On track to achieve 2024 guidance of 13% to 32% service revenue growth
- Adjusted EBITDA margin improved to 11.9% from (10.5)% in Q2 2023
- Net loss attributable to Altisource of $(8.3) million in Q2 2024
- Industrywide foreclosure initiations down 9% compared to same period in 2023
- Industrywide foreclosure sales decreased 14% year-over-year
- Industrywide mortgage origination volume decreased by 13% compared to Q2 2023
- Net debt of $198.7 million at the end of Q2 2024
Altisource's Q2 2024 results demonstrate a significant turnaround in financial performance, with notable improvements in key metrics. Service revenue increased by
The company's gross profit margin expanded substantially from
However, investors should note that despite these improvements, Altisource still reported a net loss of
The sales pipeline and recent wins are encouraging signs for future growth. With estimated potential annualized revenue of
Overall, while the company is showing signs of recovery, it's important for investors to monitor the path to profitability and debt management in the coming quarters.
Altisource's performance must be viewed in the context of broader market trends, which present a mixed picture for the company's outlook. The real estate and mortgage industries are facing significant headwinds, as evidenced by the data presented:
- Industrywide foreclosure initiations were down
9% year-over-year and37% lower than pre-COVID levels. - Foreclosure sales decreased by
14% year-over-year and are53% below pre-pandemic figures. - Mortgage origination volume declined by
13% compared to Q2 2023. - The seriously delinquent mortgage rate has fallen to
1.1% , down from1.3% in December 2023.
These trends suggest a challenging environment for companies like Altisource that rely on foreclosure-related services and mortgage originations. However, Altisource's ability to grow revenue and improve profitability metrics in this climate is noteworthy and may indicate market share gains or successful diversification strategies.
The company's guidance of
LUXEMBOURG, July 25, 2024 (GLOBE NEWSWIRE) -- Altisource Portfolio Solutions S.A. (“Altisource” or the “Company”) (NASDAQ: ASPS), a leading provider and marketplace for the real estate and mortgage industries, today reported financial results for the second quarter 2024.
“We had a strong second quarter and believe we are on track to achieve our 2024 guidance of
Mr. Shepro further commented, “We continue to win meaningful new business and are making good progress ramping sales wins on a much lower cost base. As we ramp new business, we are cautiously optimistic that we will exit the year at a
Second Quarter 2024 Highlights(2)
Company, Corporate and Financial:
- Second quarter Service revenue of
$36.9 million was$3.7 million , or11% , higher than the same quarter of 2023 - Second quarter Adjusted earnings before interest, tax, depreciation and amortization (“Adjusted EBITDA”)(1) of
$4.4 million was$7.9 million better than the same quarter of 2023 - Second quarter Adjusted EBITDA(1) margin of
11.9% was considerably stronger than the (10.5)% Adjusted EBITDA(1) margin in the same quarter of 2023 - Second quarter gross profit margin of
34.0% was considerably stronger than the16.7% gross profit margin in the same quarter of 2023 - Ended the quarter with
$29.7 million of cash and cash equivalents,$15.0 million available under a revolving credit facility and$198.7 million of net debt(1)
Business and Industry:
- Generated sales wins which we estimate represent potential annualized revenue on a stabilized basis of
$15.3 million for the Servicer and Real Estate segment and$1.5 million for the Origination segment - Ended the quarter with a weighted average sales pipeline between
$31 million and$39 million of estimated potential revenue on a stabilized basis based upon forecasted probability of closing (comprising of between$18 million and$23 million in the Servicer and Real Estate segment and between$13 million and$16 million in the Origination segment) - Improved Adjusted EBITDA(1) in the Servicer and Real Estate and Origination segments (together “Business Segments”) to
$11.6 million , or31.3% of Service revenue, from$6.0 million , or18.2% of Service revenue, in the same quarter of 2023 - Industrywide foreclosure initiations were
9% lower for the six months ended June 30, 2024 compared to the same period in 2023 (and37% lower than the same pre-COVID-19 periods in 2019)(3) - Industrywide foreclosure sales were
14% lower for the six months ended June 30, 2024 compared to the same period in 2023 (and53% lower than the same pre-COVID-19 periods in 2019)(3) - Industrywide mortgage origination volume decreased by
13% for the second quarter 2024 compared to the second quarter 2023(4) - Industrywide seriously delinquent mortgage rate (90+ day past due and loans in foreclosure) declined to
1.1% in June 2024 compared to1.3% in December 2023(3)
Second Quarter 2024 Financial Results
- Service revenue of
$36.9 million - Loss before income taxes and non-controlling interests of
$(7.6) million - Net loss attributable to Altisource of
$(8.3) million - Adjusted EBITDA(1) of
$4.4 million
Second Quarter 2024 Results Compared to the Second Quarter 2023 (unaudited):
| (in thousands, except per share data) | Second Quarter 2024 | Second Quarter 2023 | % Change | Year-to-Date June 30, 2024 | Year-to-Date June 30, 2023 | % Change | |||||||||||||
| Service revenue | $ | 36,863 | $ | 33,173 | 11 | $ | 73,754 | $ | 70,244 | 5 | |||||||||
| Revenue | 39,121 | 35,235 | 11 | 78,590 | 74,696 | 5 | |||||||||||||
| Gross profit | 12,717 | 5,532 | 130 | 25,021 | 14,036 | 78 | |||||||||||||
| Income (loss) from operations | 2,083 | (6,809 | ) | 131 | 1,535 | (10,399 | ) | 115 | |||||||||||
| Adjusted operating income (loss)(1) | 4,210 | (2,333 | ) | 280 | 7,168 | (59 | ) | N/M | |||||||||||
| Loss before income taxes and non-controlling interests | (7,566 | ) | (18,198 | ) | 58 | (16,001 | ) | (29,536 | ) | 46 | |||||||||
| Pretax loss attributable to Altisource(1) | (7,601 | ) | (18,211 | ) | 58 | (16,077 | ) | (29,629 | ) | 46 | |||||||||
| Adjusted pretax loss attributable to Altisource(1) | (5,474 | ) | (13,735 | ) | 60 | (10,444 | ) | (19,289 | ) | 46 | |||||||||
| Adjusted EBITDA(1) | 4,384 | (3,491 | ) | 226 | 9,016 | (2,020 | ) | N/M | |||||||||||
| Net loss attributable to Altisource | (8,307 | ) | (18,850 | ) | 56 | (17,505 | ) | (31,797 | ) | 45 | |||||||||
| Adjusted net loss attributable to Altisource(1) | (5,957 | ) | (14,140 | ) | 58 | (11,555 | ) | (21,228 | ) | 46 | |||||||||
| Diluted loss per share | (0.29 | ) | (0.90 | ) | 68 | (0.62 | ) | (1.62 | ) | 62 | |||||||||
| Adjusted diluted loss per share(1) | (0.21 | ) | (0.68 | ) | 69 | (0.41 | ) | (1.08 | ) | 62 | |||||||||
| Net cash provided by (used in) operating activities | 180 | (7,882 | ) | 102 | (2,057 | ) | (10,940 | ) | 81 | ||||||||||
| Net cash provided by (used in) operating activities less additions to premises and equipment(1) | 180 | (7,882 | ) | 102 | (2,057 | ) | (10,940 | ) | 81 | ||||||||||
| Margins: | |||||||||||||||||||
| Gross profit / service revenue | 34 | % | 17 | % | 34 | % | 20 | % | |||||||||||
| Adjusted EBITDA(1) / service revenue | 12 | % | (11) | % | 12 | % | (3) | % | |||||||||||
| N/M — not meaningful. | |||||||||||||||||||
| |||||||||||||||||||
| (1) This is a non-GAAP measure that is defined and reconciled to the corresponding GAAP measure herein | |||||||||||||||||||
| (2) Applies to the second quarter 2024 unless otherwise indicated | |||||||||||||||||||
| (3) Based on data from ICE’s Mortgage Monitor and First Look reports with data through June 2024 | |||||||||||||||||||
| (4) Based on estimated number of loans originated as reported by the Mortgage Bankers Association’s Mortgage Finance Forecast dated July 19, 2024 | |||||||||||||||||||
Forward-Looking Statements
This press release contains forward-looking statements that involve a number of risks and uncertainties. These forward-looking statements include all statements that are not historical fact, including statements that relate to, among other things, future events or our future performance or financial condition. These statements may be identified by words such as “anticipate,” “intend,” “expect,” “may,” “could,” “should,” “would,” “plan,” “estimate,” “seek,” “believe,” “potential” or “continue” or the negative of these terms and comparable terminology. Such statements are based on expectations as to the future and are not statements of historical fact. Furthermore, forward-looking statements are not guarantees of future performance and involve a number of assumptions, risks and uncertainties that could cause actual results to differ materially. Important factors that could cause actual results to differ materially from those suggested by the forward-looking statements include, but are not limited to, the risks discussed in Item 1A of Part I “Risk Factors” in our Form 10-K filing with the Securities and Exchange Commission, as the same may be updated from time to time in our Form 10-Q filings. We caution you not to place undue reliance on these forward-looking statements which reflect our view only as of the date of this report. We are under no obligation (and expressly disclaim any obligation) to update or alter any forward-looking statements contained herein to reflect any change in our expectations with regard thereto or change in events, conditions or circumstances on which any such statement is based. The risks and uncertainties to which forward-looking statements are subject include, but are not limited to, risks related to the COVID-19 pandemic, customer concentration, the timing of the anticipated increase in default related referrals following the expiration of foreclosure and eviction moratoriums and forbearance programs, the timing of the expiration of such moratoriums and programs, and any other delays occasioned by government, investor or servicer actions, the use and success of our products and services, our ability to retain existing customers and attract new customers and the potential for expansion or changes in our customer relationships, technology disruptions, our compliance with applicable data requirements, our use of third party vendors and contractors, our ability to effectively manage potential conflicts of interest, macro-economic and industry specific conditions, our ability to effectively manage our regulatory and contractual obligations, the adequacy of our financial resources, including our sources of liquidity and ability to repay borrowings and comply with our Credit Agreement, including the financial and other covenants contained therein, as well as Altisource’s ability to retain key executives or employees, behavior of customers, suppliers and/or competitors, technological developments, governmental regulations, taxes and policies. The financial projections and scenarios contained in this press release are expressly qualified as forward-looking statements and, as with other forward-looking statements, should not be unduly relied upon. We undertake no obligation to update these statements, scenarios and projections as a result of a change in circumstances, new information or future events.
Webcast
Altisource will host a webcast at 08:30 a.m. EDT today to discuss our second quarter. A link to the live audio webcast will be available on Altisource’s website in the Investor Relations section. Those who want to listen to the call should go to the website at least fifteen minutes prior to the call to register, download and install any necessary audio software. A replay of the conference call will be available via the website approximately two hours after the conclusion of the call and will remain available for approximately 30 days.
About Altisource
Altisource Portfolio Solutions S.A. is an integrated service provider and marketplace for the real estate and mortgage industries. Combining operational excellence with a suite of innovative services and technologies, Altisource helps solve the demands of the ever-changing markets we serve. Additional information is available at www.Altisource.com.
FOR FURTHER INFORMATION CONTACT:
Michelle D. Esterman
Chief Financial Officer
T: (770) 612-7007
E: Michelle.Esterman@altisource.com
| ALTISOURCE PORTFOLIO SOLUTIONS S.A. CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS (in thousands, except per share data) (unaudited) | |||||||||||||||
| Three months ended June 30, | Six months ended June 30, | ||||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||||
| Service revenue | $ | 36,863 | $ | 33,173 | $ | 73,754 | $ | 70,244 | |||||||
| Reimbursable expenses | 2,223 | 2,049 | 4,760 | 4,359 | |||||||||||
| Non-controlling interests | 35 | 13 | 76 | 93 | |||||||||||
| Total revenue | 39,121 | 35,235 | 78,590 | 74,696 | |||||||||||
| Cost of revenue | 26,404 | 29,703 | 53,569 | 60,660 | |||||||||||
| Gross profit | 12,717 | 5,532 | 25,021 | 14,036 | |||||||||||
| Selling, general and administrative expenses | 10,634 | 12,341 | 23,486 | 24,435 | |||||||||||
| Income (loss) from operations | 2,083 | (6,809 | ) | 1,535 | (10,399 | ) | |||||||||
| Other income (expense), net: | |||||||||||||||
| Interest expense | (9,788 | ) | (9,904 | ) | (19,317 | ) | (16,664 | ) | |||||||
| Change in fair value of warrant liability | — | (1,774 | ) | — | (1,080 | ) | |||||||||
| Debt amendment costs | — | (101 | ) | — | (3,343 | ) | |||||||||
| Other income (expense), net | 139 | 390 | 1,781 | 1,950 | |||||||||||
| Total other income (expense), net | (9,649 | ) | (11,389 | ) | (17,536 | ) | (19,137 | ) | |||||||
| Loss before income taxes and non-controlling interests | (7,566 | ) | (18,198 | ) | (16,001 | ) | (29,536 | ) | |||||||
| Income tax provision | (706 | ) | (639 | ) | (1,428 | ) | (2,168 | ) | |||||||
| Net loss | (8,272 | ) | (18,837 | ) | (17,429 | ) | (31,704 | ) | |||||||
| Net income attributable to non-controlling interests | (35 | ) | (13 | ) | (76 | ) | (93 | ) | |||||||
| Net loss attributable to Altisource | $ | (8,307 | ) | $ | (18,850 | ) | $ | (17,505 | ) | $ | (31,797 | ) | |||
| Loss per share: | |||||||||||||||
| Basic | $ | (0.29 | ) | $ | (0.90 | ) | $ | (0.62 | ) | $ | (1.62 | ) | |||
| Diluted | $ | (0.29 | ) | $ | (0.90 | ) | $ | (0.62 | ) | $ | (1.62 | ) | |||
| Weighted average shares outstanding: | |||||||||||||||
| Basic | 28,551 | 20,840 | 28,366 | 19,648 | |||||||||||
| Diluted | 28,551 | 20,840 | 28,366 | 19,648 | |||||||||||
| Comprehensive loss: | |||||||||||||||
| Comprehensive loss, net of tax | $ | (8,272 | ) | $ | (18,837 | ) | $ | (17,429 | ) | $ | (31,704 | ) | |||
| Comprehensive income attributable to non-controlling interests | (35 | ) | (13 | ) | (76 | ) | (93 | ) | |||||||
| Comprehensive loss attributable to Altisource | $ | (8,307 | ) | $ | (18,850 | ) | $ | (17,505 | ) | $ | (31,797 | ) | |||
| ALTISOURCE PORTFOLIO SOLUTIONS S.A. CONSOLIDATED BALANCE SHEETS (in thousands, except for per share data) (unaudited) | |||||||
| June 30, 2024 | December 31, 2023 | ||||||
| ASSETS | |||||||
| Current assets: | |||||||
| Cash and cash equivalents | $ | 29,702 | $ | 32,522 | |||
| Accounts receivable, net of allowance for doubtful accounts of | 13,190 | 11,682 | |||||
| Prepaid expenses and other current assets | 8,309 | 11,336 | |||||
| Total current assets | 51,201 | 55,540 | |||||
| Premises and equipment, net | 1,124 | 1,709 | |||||
| Right-of-use assets under operating leases | 2,612 | 3,379 | |||||
| Goodwill | 55,960 | 55,960 | |||||
| Intangible assets, net | 24,008 | 26,548 | |||||
| Deferred tax assets, net | 4,983 | 4,992 | |||||
| Other assets | 6,669 | 6,730 | |||||
| Total assets | $ | 146,557 | $ | 154,858 | |||
| LIABILITIES AND DEFICIT | |||||||
| Current liabilities: | |||||||
| Accounts payable and accrued expenses | $ | 30,044 | $ | 30,088 | |||
| Current portion of long-term debt | 223,009 | — | |||||
| Deferred revenue | 3,634 | 3,195 | |||||
| Other current liabilities | 2,245 | 2,477 | |||||
| Total current liabilities | 258,932 | 35,760 | |||||
| Long-term debt | — | 215,615 | |||||
| Deferred tax liabilities, net | 9,047 | 9,028 | |||||
| Other non-current liabilities | 18,778 | 19,510 | |||||
| Commitments, contingencies and regulatory matters | |||||||
| Deficit: | |||||||
| Common stock ( | 29,963 | 29,963 | |||||
| Additional paid-in capital | 179,937 | 177,278 | |||||
| Accumulated deficit | (234,351 | ) | (180,162 | ) | |||
| Treasury stock, at cost (2,853 shares as of June 30, 2024 and 3,467 shares as of December 31, 2023) | (116,389 | ) | (152,749 | ) | |||
| Altisource deficit | (140,840 | ) | (125,670 | ) | |||
| Non-controlling interests | 640 | 615 | |||||
| Total deficit | (140,200 | ) | (125,055 | ) | |||
| Total liabilities and deficit | $ | 146,557 | $ | 154,858 | |||
| ALTISOURCE PORTFOLIO SOLUTIONS S.A. CONSOLIDATED STATEMENTS OF CASH FLOWS (in thousands) (unaudited) | |||||||
| Six months ended June 30, | |||||||
| 2024 | 2023 | ||||||
| Cash flows from operating activities: | |||||||
| Net loss | $ | (17,429 | ) | $ | (31,704 | ) | |
| Adjustments to reconcile net loss to net cash used in operating activities: | |||||||
| Depreciation and amortization | 572 | 1,353 | |||||
| Amortization of right-of-use assets under operating leases | 811 | 930 | |||||
| Amortization of intangible assets | 2,540 | 2,560 | |||||
| PIK accrual | 4,269 | 2,556 | |||||
| Share-based compensation expense | 3,057 | 2,687 | |||||
| Bad debt expense | 550 | 522 | |||||
| Amortization of debt discount | 1,901 | 1,828 | |||||
| Amortization of debt issuance costs | 1,224 | 1,249 | |||||
| Deferred income taxes | 18 | (203 | ) | ||||
| Loss on disposal of fixed assets | 13 | 27 | |||||
| Change in fair value of warrant liability | — | 1,080 | |||||
| Changes in operating assets and liabilities: | |||||||
| Accounts receivable | (2,058 | ) | (1,214 | ) | |||
| Prepaid expenses and other current assets | 3,027 | 12,504 | |||||
| Other assets | 61 | (2,045 | ) | ||||
| Accounts payable and accrued expenses | (44 | ) | (1,187 | ) | |||
| Current and non-current operating lease liabilities | (838 | ) | (960 | ) | |||
| Other current and non-current liabilities | 269 | (923 | ) | ||||
| Net cash used in operating activities | (2,057 | ) | (10,940 | ) | |||
| Cash flows from financing activities: | |||||||
| Proceeds from issuance of common stock, net of issuance costs | — | 20,461 | |||||
| Exercise of Warrants, net of costs | (90 | ) | — | ||||
| Debt issuance and amendment costs | — | (4,886 | ) | ||||
| Repayments of long-term debt | — | (20,000 | ) | ||||
| Distributions to non-controlling interests | (51 | ) | (202 | ) | |||
| Payments of tax withholding on issuance of restricted share units and restricted shares | (632 | ) | (463 | ) | |||
| Net cash used in financing activities | (773 | ) | (5,090 | ) | |||
| Net decrease in cash, cash equivalents and restricted cash | (2,830 | ) | (16,030 | ) | |||
| Cash, cash equivalents and restricted cash at the beginning of the period | 35,416 | 54,273 | |||||
| Cash, cash equivalents and restricted cash at the end of the period | $ | 32,586 | $ | 38,243 | |||
| Supplemental cash flow information: | |||||||
| Interest paid | $ | 11,870 | $ | 11,022 | |||
| Income taxes paid (refunded), net | 1,121 | (4,509 | ) | ||||
| Acquisition of right-of-use assets with operating lease liabilities | 44 | 298 | |||||
| Non-cash investing and financing activities: | |||||||
| Warrants issued in connection with Amended Credit Agreement | — | 8,096 | |||||
| ALTISOURCE PORTFOLIO SOLUTIONS S.A. NON-GAAP MEASURES (in thousands, except per share data) (unaudited) |
Adjusted operating income (loss), pretax loss attributable to Altisource, adjusted pretax loss attributable to Altisource, adjusted net loss attributable to Altisource, adjusted diluted loss per share, net cash used in operating activities less additions to premises and equipment, Adjusted EBITDA, Business Segments Adjusted EBITDA and net debt, which are presented elsewhere in this earnings release, are non-GAAP measures used by management, existing shareholders, potential shareholders and other users of our financial information to measure Altisource’s performance and do not purport to be alternatives to income (loss) from operations, loss before income taxes and non-controlling interests, net loss attributable to Altisource, diluted loss per share, net cash used in operating activities and long-term debt, including current portion, as measures of Altisource’s performance. We believe these measures are useful to management, existing shareholders, potential shareholders and other users of our financial information in evaluating operating profitability and cash flow generation more on the basis of continuing cost and cash flows as they exclude amortization expense related to acquisitions that occurred in prior periods and non-cash share-based compensation, as well as the effect of more significant non-operational items from earnings, cash flows from operating activities and long-term debt net of cash on-hand. We believe these measures are also useful in evaluating the effectiveness of our operations and underlying business trends in a manner that is consistent with management’s evaluation of business performance. Furthermore, we believe the exclusion of more significant non-operational items enables comparability to prior period performance and trend analysis. Specifically, management uses adjusted net loss attributable to Altisource to measure the on-going after tax performance of the Company because the measure adjusts for the after tax impact of more significant non-recurring items, amortization expense relating to prior acquisitions (some of which fluctuates with revenue from certain customers and some of which is amortized on a straight-line basis) and non-cash share-based compensation expense which can fluctuate based on vesting schedules, grant date timing and the value attributable to awards. We believe adjusted net loss attributable to Altisource is useful to existing shareholders, potential shareholders and other users of our financial information because it provides an after-tax measure of Altisource’s on-going performance that enables these users to perform trend analysis using comparable data. Management uses adjusted diluted loss per share to further evaluate adjusted net loss attributable to Altisource while taking into account changes in the number of diluted shares over the comparable periods. We believe adjusted diluted loss per share is useful to existing shareholders, potential shareholders and other users of our financial information because it also enables these users to evaluate adjusted net loss attributable to Altisource on a per share basis. Management uses Adjusted EBITDA to measure the Company’s overall performance and Business Segments Adjusted EBITDA to measure the segments overall performance (with the adjustments discussed earlier with regard to adjusted net loss attributable to Altisource) without regard to its capitalization (debt vs. equity) or its income taxes and to perform trend analysis of the Company’s performance over time. Our effective income tax rate can vary based on the jurisdictional mix of our income. Additionally, as the Company’s capital expenditures have significantly declined over time, it provides a measure for management to evaluate the Company’s performance without regard to prior capital expenditures. Management also uses Adjusted EBITDA as one of the measures in determining bonus compensation for certain employees. We believe Adjusted EBITDA and Business Segments Adjusted EBITDA are useful to existing shareholders, potential shareholders and other users of our financial information for the same reasons that management finds the measure useful. Management uses net debt in evaluating the amount of debt the Company has that is in excess of cash and cash equivalents. We believe net debt is useful to existing shareholders, potential shareholders and other users of our financial information for the same reasons management finds the measure useful.
Altisource operates in several countries, including Luxembourg, India, the United States and Uruguay. The Company has differing effective tax rates in each country and these rates may change from year to year. In determining the tax effects related to the adjustments in calculating adjusted net loss attributable to Altisource and adjusted diluted loss per share, we use the tax rate in the country in which the adjustment applies or, if the adjustment is recognized in more than one country, we separate the adjustment by country, apply the relevant tax rate for each country to the applicable adjustment, and then sum the result to arrive at the total adjustment, net of tax. In 2019, the Company recognized a full valuation allowance on its net deferred tax assets in Luxembourg. Accordingly, for 2024 and 2023, the Company has an effective tax rate of close to
It is management’s intent to provide non-GAAP financial information to enhance the understanding of Altisource’s GAAP financial information, and it should be considered by the reader in addition to, but not instead of, the financial statements prepared in accordance with GAAP. Each non-GAAP financial measure is presented along with the corresponding GAAP measure so as not to imply that more emphasis should be placed on the non-GAAP measure. The non-GAAP financial information presented may be determined or calculated differently by other companies. The non-GAAP financial information should not be unduly relied upon.
Adjusted operating income (loss) is calculated by removing intangible asset amortization expense, share-based compensation expense, cost of cost savings initiatives and other, debt amendment costs and unrealized loss on warrant liability from income (loss) from operations. Pretax loss attributable to Altisource is calculated by removing non-controlling interests from loss before income taxes and non-controlling interests. Adjusted pretax loss attributable to Altisource is calculated by removing non-controlling interests, intangible asset amortization expense, share-based compensation expense, cost of cost savings initiatives and other, debt amendment costs and unrealized loss on warrant liability from loss before income taxes and non-controlling interests. Adjusted net loss attributable to Altisource is calculated by removing intangible asset amortization expense (net of tax), share-based compensation expense (net of tax), cost of cost savings initiatives and other (net of tax), debt amendment costs, unrealized loss on warrant liability and certain income tax related items from net loss attributable to Altisource. Adjusted diluted loss per share is calculated by dividing net loss attributable to Altisource after removing intangible asset amortization expense (net of tax), share-based compensation expense (net of tax), cost of cost savings initiatives and other (net of tax), debt amendment costs (net of tax), unrealized loss on warrant liability (net of tax) and certain income tax related items by the weighted average number of diluted shares. Net cash used in operating activities less additions to premises and equipment is calculated by removing additions to premises and equipment from net cash used in operating activities. Adjusted EBITDA is calculated by removing the income tax provision, interest expense (net of interest income), depreciation and amortization, intangible asset amortization expense, share-based compensation expense, cost of cost savings initiatives and other, debt amendment costs and unrealized loss on warrant liability from net loss attributable to Altisource. Business Segments Adjusted EBITDA is calculated by removing non-controlling interests, depreciation and amortization, intangible asset amortization expense, share-based compensation expense, cost of cost savings initiatives and other from income before income taxes and non-controlling interests. Net debt is calculated as long-term debt, including current portion, minus cash and cash equivalents.
Reconciliations of the non-GAAP measures to the corresponding GAAP measures are as follows:
| Three months ended June 30, | Six months ended June 30, | ||||||||||||||
| 2024 | 2023 | 2024 | 2023 | ||||||||||||
| Income (loss) from operations | $ | 2,083 | $ | (6,809 | ) | $ | 1,535 | $ | (10,399 | ) | |||||
| Intangible asset amortization expense | 1,270 | 1,280 | 2,540 | 2,560 | |||||||||||
| Share-based compensation expense | 844 | 1,242 | 3,057 | 2,687 | |||||||||||
| Cost of cost savings initiatives and other | 13 | 79 | 36 | 670 | |||||||||||
| Debt amendment costs | — | 101 | — | 3,343 | |||||||||||
| Unrealized loss on warrant liability | — | 1,774 | — | 1,080 | |||||||||||
| Adjusted operating income (loss) | $ | 4,210 | $ | (2,333 | ) | $ | 7,168 | $ | (59 | ) | |||||
| Loss before income taxes and non-controlling interests | $ | (7,566 | ) | $ | (18,198 | ) | $ | (16,001 | ) | $ | (29,536 | ) | |||
| Non-controlling interests | (35 | ) | (13 | ) | (76 | ) | (93 | ) | |||||||
| Pretax loss attributable to Altisource | (7,601 | ) | (18,211 | ) | (16,077 | ) | (29,629 | ) | |||||||
| Intangible asset amortization expense | 1,270 | 1,280 | 2,540 | 2,560 | |||||||||||
| Share-based compensation expense | 844 | 1,242 | 3,057 | 2,687 | |||||||||||
| Cost of cost savings initiatives and other | 13 | 79 | 36 | 670 | |||||||||||
| Debt amendment costs | — | 101 | — | 3,343 | |||||||||||
| Unrealized loss on warrant liability | — | 1,774 | — | 1,080 | |||||||||||
| Adjusted pretax loss attributable to Altisource | $ | (5,474 | ) | $ | (13,735 | ) | $ | (10,444 | ) | $ | (19,289 | ) | |||
| Net loss attributable to Altisource | $ | (8,307 | ) | $ | (18,850 | ) | $ | (17,505 | ) | $ | (31,797 | ) | |||
| Intangible asset amortization expense, net of tax | 1,270 | 1,278 | 2,540 | 2,555 | |||||||||||
| Share-based compensation expense, net of tax | 715 | 1,109 | 2,677 | 2,276 | |||||||||||
| Cost of cost savings initiatives and other, net of tax | 11 | 65 | 28 | 556 | |||||||||||
| Debt amendment costs, net of tax | — | 101 | — | 3,343 | |||||||||||
| Unrealized loss on warrant liability, net of tax | — | 1,774 | — | 1,080 | |||||||||||
| Certain income tax related items | 354 | 383 | 705 | 759 | |||||||||||
| Adjusted net loss attributable to Altisource | $ | (5,957 | ) | $ | (14,140 | ) | $ | (11,555 | ) | $ | (21,228 | ) | |||
| Diluted loss per share | $ | (0.29 | ) | $ | (0.90 | ) | $ | (0.62 | ) | $ | (1.62 | ) | |||
| Intangible asset amortization expense, net of tax, per diluted share | 0.04 | 0.06 | 0.09 | 0.13 | |||||||||||
| Share-based compensation expense, net of tax, per diluted share | 0.03 | 0.05 | 0.09 | 0.12 | |||||||||||
| Cost of cost savings initiatives and other, net of tax, per diluted share | — | — | — | 0.03 | |||||||||||
| Debt amendment costs, net of tax, per diluted share | — | — | — | 0.17 | |||||||||||
| Unrealized loss on warrant liability, net of tax, per diluted share | — | 0.09 | — | 0.05 | |||||||||||
| Certain income tax related items per diluted share | 0.01 | 0.02 | 0.02 | 0.04 | |||||||||||
| Adjusted diluted loss per share | $ | (0.21 | ) | $ | (0.68 | ) | $ | (0.41 | ) | $ | (1.08 | ) | |||
| Calculation of the impact of intangible asset amortization expense, net of tax | |||||||||||||||
| Intangible asset amortization expense | $ | 1,270 | $ | 1,280 | $ | 2,540 | $ | 2,560 | |||||||
| Tax benefit from intangible asset amortization | — | (2 | ) | — | (5 | ) | |||||||||
| Intangible asset amortization expense, net of tax | 1,270 | 1,278 | 2,540 | 2,555 | |||||||||||
| Diluted share count | 28,551 | 20,840 | 28,366 | 19,648 | |||||||||||
| Intangible asset amortization expense, net of tax, per diluted share | $ | 0.04 | $ | 0.06 | $ | 0.09 | $ | 0.13 | |||||||
| Calculation of the impact of share-based compensation expense, net of tax | |||||||||||||||
| Share-based compensation expense | $ | 844 | $ | 1,242 | $ | 3,057 | $ | 2,687 | |||||||
| Tax benefit from share-based compensation expense | (129 | ) | (133 | ) | (380 | ) | (411 | ) | |||||||
| Share-based compensation expense, net of tax | 715 | 1,109 | 2,677 | 2,276 | |||||||||||
| Diluted share count | 28,551 | 20,840 | 28,366 | 19,648 | |||||||||||
| Share-based compensation expense, net of tax, per diluted share | $ | 0.03 | $ | 0.05 | $ | 0.09 | $ | 0.12 | |||||||
| Calculation of the impact of cost of cost savings initiatives and other, net of tax | |||||||||||||||
| Cost of cost savings initiatives and other | $ | 13 | $ | 79 | $ | 36 | $ | 670 | |||||||
| Tax benefit from cost of cost savings initiatives and other | (2 | ) | (14 | ) | (8 | ) | (114 | ) | |||||||
| Cost of cost savings initiatives and other, net of tax | 11 | 65 | 28 | 556 | |||||||||||
| Diluted share count | 28,551 | 20,840 | 28,366 | 19,648 | |||||||||||
| Cost of cost savings initiatives and other, net of tax, per diluted share | $ | 0.00 | $ | 0.00 | $ | 0.00 | $ | 0.03 | |||||||
| Calculation of the impact of debt amendment costs, net of tax | |||||||||||||||
| Debt amendment costs | $ | — | $ | 101 | $ | — | $ | 3,343 | |||||||
| Tax benefit from debt amendment costs | — | — | — | — | |||||||||||
| Debt amendment costs, net of tax | — | 101 | — | 3,343 | |||||||||||
| Diluted share count | 28,551 | 20,840 | 28,366 | 19,648 | |||||||||||
| Debt amendment costs, net of tax, per diluted share | $ | — | $ | 0.00 | $ | — | $ | 0.17 | |||||||
| Calculation of the impact of unrealized loss on warrant liability, net of tax | |||||||||||||||
| Unrealized loss on warrant liability | $ | — | $ | 1,774 | $ | — | $ | 1,080 | |||||||
| Tax benefit from unrealized gain on warrant liability | — | — | — | — | |||||||||||
| Unrealized loss on warrant liability, net of tax | — | 1,774 | — | 1,080 | |||||||||||
| Diluted share count | 28,551 | 20,840 | 28,366 | 19,648 | |||||||||||
| Unrealized loss on warrant liability, net of tax, per diluted share | $ | — | $ | 0.09 | $ | — | $ | 0.05 | |||||||
| Certain income tax related items resulting from: | |||||||||||||||
| Foreign income tax reserves / other | $ | 354 | $ | 383 | $ | 705 | $ | 759 | |||||||
| Certain income tax related items | 354 | 383 | 705 | 759 | |||||||||||
| Diluted share count | 28,551 | 20,840 | 28,366 | 19,648 | |||||||||||
| Certain income tax related items per diluted share | $ | 0.01 | $ | 0.02 | $ | 0.02 | $ | 0.04 | |||||||
| Net cash provided by (used in) operating activities | $ | 180 | $ | (7,882 | ) | $ | (2,057 | ) | $ | (10,940 | ) | ||||
| Less: additions to premises and equipment | — | — | — | — | |||||||||||
| Net cash provided by (used in) operating activities less additions to premises and equipment | $ | 180 | $ | (7,882 | ) | $ | (2,057 | ) | $ | (10,940 | ) | ||||
| Three months ended | |||||||||||
| June 30, 2024 | June 30, 2023 | December 31, 2023 | |||||||||
| Net loss attributable to Altisource | $ | (8,307 | ) | $ | (18,850 | ) | $ | (13,151 | ) | ||
| Income tax provision | 706 | 639 | 1,128 | ||||||||
| Interest expense (net of interest income) | 9,582 | 9,589 | 9,246 | ||||||||
| Depreciation and amortization | 276 | 654 | 459 | ||||||||
| Intangible asset amortization expense | 1,270 | 1,280 | 1,270 | ||||||||
| Share-based compensation expense | 844 | 1,242 | 1,151 | ||||||||
| Cost of cost savings initiatives and other | 13 | 79 | 127 | ||||||||
| Debt amendment costs | — | 101 | 7 | ||||||||
| Unrealized loss on warrant liability | — | 1,774 | — | ||||||||
| Adjusted EBITDA | $ | 4,384 | $ | (3,491 | ) | $ | 237 | ||||
| Business Segments: | |||||||||||
| Income before income taxes and non-controlling interests | $ | 9,907 | $ | 4,191 | $ | 6,626 | |||||
| Non-controlling interests | (35 | ) | (13 | ) | (73 | ) | |||||
| Depreciation and amortization | 88 | 224 | 110 | ||||||||
| Intangible asset amortization expense | 1,270 | 1,280 | 1,270 | ||||||||
| Share-based compensation expense | 314 | 304 | 277 | ||||||||
| Cost of cost savings initiatives and other | 9 | 54 | 31 | ||||||||
| Interest expense (net of interest income) | 1 | — | — | ||||||||
| Business Segments Adjusted EBITDA | $ | 11,554 | $ | 6,040 | $ | 8,241 | |||||
| June 30, 2024 | |||
| Senior Secured Term Loans | $ | 228,354 | |
| Less: Cash and cash equivalents | (29,702 | ) | |
| Net debt | $ | 198,652 | |
| _______________________________ | |||
Note: Amounts may not add to the total due to rounding. | | | |
FAQ
What was Altisource's (ASPS) service revenue for Q2 2024?
How much Adjusted EBITDA did Altisource (ASPS) report in Q2 2024?
What is Altisource's (ASPS) 2024 revenue growth guidance?
How much cash did Altisource (ASPS) have at the end of Q2 2024?
What was Altisource's (ASPS) gross profit margin in Q2 2024?
