loanDepot Announces First Quarter 2024 Financial Results
loanDepot, Inc. (NYSE: LDI) announced its first quarter 2024 financial results, with revenue increasing by 7% to $223 million, driven by higher servicing income and gain on sale margin. Expenses decreased by 2% to $308 million, with a net loss decreasing by 22% to $72 million. Despite a $15 million impact from a cyber incident, adjusted net loss also decreased by 35% to $38 million. The company maintained a strong liquidity position with a cash balance of $604 million.
Revenue increased by 7% to $223 million driven by higher servicing income and gain on sale margin.
Expenses decreased by 2% to $308 million, attributed to lower personnel and marketing costs.
Adjusted net loss decreased by 35% to $38 million despite a $15 million impact from a cyber incident.
loanDepot maintained a strong liquidity position with a cash balance of $604 million.
The company incurred $15 million in net charges directly related to a cyber incident during the quarter.
Despite positive revenue and cost momentum, there was a revenue loss due to the cyber incident.
Insights
Reviewing the just-released quarterly financials from loanDepot, the 7% increase in revenue to
The reduction in expenses by 2% to
Another financial health indicator, the strong liquidity position with a cash balance of
The mention of a January cyber incident resulting in
Furthermore, for investors, the company's response to the cyber incident is an indicator of its risk management capabilities. loanDepot's future investment in digital infrastructure and preventative cybersecurity measures will be critical to its risk profile and operational resilience. Evaluating the company's risk mitigation strategies and cybersecurity posture will be paramount when assessing its long-term sustainability and appeal to risk-averse investors.
The financial results, while showing a mixed scenario, demonstrate loanDepot’s risk mitigation prowess in maintaining a strong liquidity profile in the face of adversity. A cash balance of
Investors should consider the company’s agility in reducing costs and its ability to manage unexpected financial impacts, like those from cyber incidents. The strategic management of risks related to cyber threats and the ability to recover financially without significantly depleting cash reserves demonstrate a certain resilience. However, the ongoing need to balance such threats with operational efficiency and profitability remains a critical factor in evaluating the company's long-term prospects.
Positive revenue and cost momentum partially offset by the impact of January cyber incident.
Year-over year highlights:
-
Revenue increased
$15 million 7% to$223 million -
Expenses decreased
$7 million 2% to$308 million $15 million -
Net loss decreased
22% to$72 million -
Adjusted net loss decreased
35% to$38 million -
Maintained strong liquidity profile with cash balance of
$604 million
loanDepot, Inc. (NYSE: LDI), (together with its subsidiaries, “loanDepot” or the “Company”), a leading provider of lending solutions that make the American dream of homeownership more accessible and achievable for all, today announced results for the first quarter ended March 31, 2024.
“We exited 2023 with positive top-line momentum and continued to make progress toward our Vision 2025 goals, including forward-looking investments in our people, products and technology platforms,” said President and Chief Executive Officer Frank Martell. “During the quarter, the company was significantly impacted by a cyber incident. The company was able to restore operations relatively quickly, however lost revenue and additional expenses related to the incident impacted our first quarter financial results. We do not expect further disruptions in our operations stemming from this incident.
“Looking forward to the remainder of 2024, we plan to continue investing in revenue generating opportunities, which we believe will positively impact this year as well as drive towards our goal of first quartile operating efficiencies. Although it is likely that market conditions will remain challenging, we believe that maximizing profitable revenue growth opportunities and operating leverage benefits will support our march towards our objective of achieving profitability.”
“During the quarter, we continued to focus on profitable growth and reducing costs, including achieving
First Quarter Highlights: |
|||||||||||
Financial Summary |
|||||||||||
|
Three Months Ended |
||||||||||
($ in thousands except per share data) (Unaudited) |
Mar 31,
|
|
Dec 31,
|
|
Mar 31,
|
||||||
Rate lock volume |
$ |
6,802,330 |
|
|
$ |
6,417,419 |
|
|
$ |
8,468,435 |
|
Pull through weighted lock volume(1) |
|
4,731,836 |
|
|
|
4,407,386 |
|
|
|
5,325,488 |
|
Loan origination volume |
|
4,558,351 |
|
|
|
5,370,708 |
|
|
|
4,944,337 |
|
Gain on sale margin(2) |
|
2.84 |
% |
|
|
2.43 |
% |
|
|
2.43 |
% |
Pull through weighted gain on sale margin(3) |
|
2.74 |
% |
|
|
2.96 |
% |
|
|
2.26 |
% |
Financial Results |
|
|
|
|
|
||||||
Total revenue |
$ |
222,785 |
|
|
$ |
228,626 |
|
|
$ |
207,901 |
|
Total expense |
|
307,950 |
|
|
|
302,571 |
|
|
|
314,484 |
|
Net loss |
|
(71,505 |
) |
|
|
(59,771 |
) |
|
|
(91,721 |
) |
Diluted loss per share |
$ |
(0.19 |
) |
|
$ |
(0.16 |
) |
|
$ |
(0.25 |
) |
Non-GAAP Financial Measures(4) |
|
|
|
|
|
||||||
Adjusted total revenue |
$ |
230,860 |
|
|
$ |
251,450 |
|
|
$ |
226,190 |
|
Adjusted net loss |
|
(38,111 |
) |
|
|
(26,660 |
) |
|
|
(58,977 |
) |
Adjusted EBITDA (LBITDA) |
|
2,384 |
|
|
|
14,957 |
|
|
|
(27,590 |
) |
(1) |
Pull through weighted rate lock volume is the principal balance of loans subject to interest rate lock commitments, net of a pull-through factor for the loan funding probability. |
|
(2) |
Gain on sale margin represents the total of (i) gain on origination and sale of loans, net, and (ii) origination income, net, divided by loan origination volume during period. |
|
(3) |
Pull through weighted gain on sale margin represents the total of (i) gain on origination and sale of loans, net, and (ii) origination income, net, divided by the pull through weighted rate lock volume. |
|
(4) |
See “Non-GAAP Financial Measures” for a discussion of Non-GAAP Financial Measures and a reconciliation of these metrics to their closest GAAP measure. |
Year-over-Year Operational Highlights
-
Non-volume related expenses decreased
$8.4 million -
Incurred restructuring and impairment charges totaling
$3.9 million $2.3 million -
Accrued
$1.1 million -
Pull through weighted lock volume of
$4.7 billion $0.6 billion 11% from the first quarter of 2023, and reflected the impact of the cyber incident. Rate lock volume contributed to quarterly total revenue of$222.8 million $14.9 million 7% , over the same period, which increase was primarily due to higher servicing fee income and pull-through weighted gain on sale margin. -
Loan origination volume for the first quarter of 2024 was
$4.6 billion $0.4 billion 8% from the first quarter of 2023. -
Purchase volume increased to
72% of total loans originated during the first quarter, up from71% of total loans originated during the first quarter of 2023. -
For the three months ending March 31, 2024, our preliminary organic refinance consumer direct recapture rate1 decreased to
59% from the first quarter 2023’s refinance rate of67% . -
Net loss for the first quarter of 2024 of
$71.5 million $91.7 million -
Adjusted net loss for the first quarter of 2024 was
$38.1 million $59.0 million
Outlook for the second quarter of 2024
-
Origination volume of between
$5 billion $7 billion -
Pull-through weighted rate lock volume of between
$4.5 billion $6.5 billion - Pull-through weighted gain on sale margin of between 260 basis points and 290 basis points.
Servicing |
||||||||||||
|
|
Three Months Ended |
||||||||||
Servicing Revenue Data: ($ in thousands) (Unaudited) |
|
Mar 31,
|
|
Dec 31,
|
|
Mar 31,
|
||||||
Due to changes in valuation inputs or assumptions |
|
$ |
28,244 |
|
|
$ |
(71,195 |
) |
|
$ |
(21,368 |
) |
Due to collection/realization of cash flows |
|
|
(35,999 |
) |
|
|
(34,433 |
) |
|
|
(34,657 |
) |
Realized (losses) gains on sales of servicing rights, net (1) |
|
|
(1,196 |
) |
|
|
(192 |
) |
|
|
140 |
|
Net (losses) gains from derivatives hedging servicing rights |
|
|
(36,319 |
) |
|
|
48,371 |
|
|
|
3,079 |
|
Changes in fair value of servicing rights, net |
|
$ |
(45,270 |
) |
|
$ |
(57,449 |
) |
|
$ |
(52,806 |
) |
|
|
|
|
|
|
|
||||||
Servicing fee income (2) |
|
$ |
124,059 |
|
|
$ |
132,482 |
|
|
$ |
119,889 |
|
(1) |
Includes the provision for sold MSRs. |
|
(2) |
Servicing fee income for the three months ended March 31, 2023, has been adjusted to incorporate earnings credits, which were previously classified as part of net interest income. |
|
|
Three Months Ended |
||||||||||
Servicing Rights, at Fair Value: ($ in thousands) (Unaudited) |
|
Mar 31,
|
|
Dec 31,
|
|
Mar 31,
|
||||||
Balance at beginning of period |
|
$ |
1,985,718 |
|
|
$ |
2,038,654 |
|
|
$ |
2,025,136 |
|
Additions |
|
|
48,375 |
|
|
|
62,158 |
|
|
|
59,295 |
|
Sales proceeds |
|
|
(56,113 |
) |
|
|
(9,521 |
) |
|
|
(12,029 |
) |
Changes in fair value: |
|
|
|
|
|
|
||||||
Due to changes in valuation inputs or assumptions |
|
|
28,244 |
|
|
|
(71,195 |
) |
|
|
(21,368 |
) |
Due to collection/realization of cash flows |
|
|
(35,999 |
) |
|
|
(34,433 |
) |
|
|
(34,657 |
) |
Realized (losses) gains on sales of servicing rights |
|
|
(61 |
) |
|
|
55 |
|
|
|
191 |
|
Balance at end of period (1) |
|
$ |
1,970,164 |
|
|
$ |
1,985,718 |
|
|
$ |
2,016,568 |
|
(1) |
Balances are net of |
____________________________________
1 We define organic refinance consumer direct recapture rate as the total unpaid principal balance (“UPB”) of loans in our servicing portfolio that are paid in full for purposes of refinancing the loan on the same property, with the Company acting as lender on both the existing and new loan, divided by the UPB of all loans in our servicing portfolio that paid in full for the purpose of refinancing the loan on the same property. The recapture rate is finalized following the publication date of this release when external data becomes available.
|
|
|
% Change |
||||||||||||||
Servicing Portfolio Data: ($ in thousands) (Unaudited) |
Mar 31,
|
|
Dec 31,
|
|
Mar 31,
|
|
Mar-24 vs Dec-23 |
|
Mar-24
|
||||||||
|
|
|
|
|
|
|
|
|
|
||||||||
Servicing portfolio (unpaid principal balance) |
$ |
142,337,251 |
|
|
$ |
145,090,199 |
|
|
$ |
141,673,464 |
|
|
(1.9 |
)% |
|
0.5 |
% |
|
|
|
|
|
|
|
|
|
|
||||||||
Total servicing portfolio (units) |
|
491,871 |
|
|
|
496,894 |
|
|
|
475,765 |
|
|
(1.0 |
) |
|
3.4 |
|
|
|
|
|
|
|
|
|
|
|
||||||||
60+ days delinquent ($) |
$ |
1,445,489 |
|
|
$ |
1,392,606 |
|
|
$ |
1,282,432 |
|
|
3.8 |
|
|
12.7 |
|
60+ days delinquent (%) |
|
1.0 |
% |
|
|
1.0 |
% |
|
|
0.9 |
% |
|
|
|
|
||
|
|
|
|
|
|
|
|
|
|
||||||||
Servicing rights, net to UPB |
|
1.38 |
% |
|
|
1.37 |
% |
|
|
1.42 |
% |
|
|
|
|
||
Balance Sheet Highlights |
||||||||||||||
|
|
|
|
|
|
|
% Change |
|||||||
($ in thousands) (Unaudited) |
Mar 31,
|
|
Dec 31,
|
|
Mar 31,
|
|
Mar-24
|
|
Mar-24
|
|||||
Cash and cash equivalents |
$ |
603,663 |
|
$ |
660,707 |
|
$ |
798,119 |
|
(8.6 |
)% |
|
(24.4 |
)% |
Loans held for sale, at fair value |
|
2,300,058 |
|
|
2,132,880 |
|
|
2,039,367 |
|
7.8 |
|
|
12.8 |
|
Servicing rights, at fair value |
|
1,985,948 |
|
|
1,999,763 |
|
|
2,028,788 |
|
(0.7 |
) |
|
(2.1 |
) |
Total assets |
|
6,193,270 |
|
|
6,151,048 |
|
|
6,190,791 |
|
0.7 |
|
|
— |
|
Warehouse and other lines of credit |
|
2,069,619 |
|
|
1,947,057 |
|
|
1,830,320 |
|
6.3 |
|
|
13.1 |
|
Total liabilities |
|
5,555,928 |
|
|
5,446,564 |
|
|
5,349,629 |
|
2.0 |
|
|
3.9 |
|
Total equity |
|
637,342 |
|
|
704,484 |
|
|
841,162 |
|
(9.5 |
) |
|
(24.2 |
) |
An increase in loans held for sale at March 31, 2024, resulted in a corresponding increase in the balance on our warehouse lines of credit. Total funding capacity with our lending partners was
Consolidated Statements of Operations |
|||||||||||
($ in thousands except per share data) |
Three Months Ended |
||||||||||
|
Mar 31,
|
|
Dec 31,
|
|
Mar 31,
|
||||||
|
(Unaudited) |
||||||||||
REVENUES: |
|
|
|
|
|
||||||
Interest income |
$ |
30,925 |
|
|
$ |
34,992 |
|
|
$ |
27,958 |
|
Interest expense |
|
(31,666 |
) |
|
|
(33,686 |
) |
|
|
(27,688 |
) |
Net interest (expense) income |
|
(741 |
) |
|
|
1,306 |
|
|
|
270 |
|
|
|
|
|
|
|
||||||
Gain on origination and sale of loans, net |
|
116,060 |
|
|
|
113,185 |
|
|
|
108,152 |
|
Origination income, net |
|
13,606 |
|
|
|
17,120 |
|
|
|
12,016 |
|
Servicing fee income |
|
124,059 |
|
|
|
132,482 |
|
|
|
119,889 |
|
Change in fair value of servicing rights, net |
|
(45,270 |
) |
|
|
(57,449 |
) |
|
|
(52,806 |
) |
Other income |
|
15,071 |
|
|
|
21,982 |
|
|
|
20,380 |
|
Total net revenues |
|
222,785 |
|
|
|
228,626 |
|
|
|
207,901 |
|
|
|
|
|
|
|
||||||
EXPENSES: |
|
|
|
|
|
||||||
Personnel expense |
|
134,318 |
|
|
|
132,752 |
|
|
|
141,027 |
|
Marketing and advertising expense |
|
28,354 |
|
|
|
28,360 |
|
|
|
35,914 |
|
Direct origination expense |
|
18,171 |
|
|
|
16,790 |
|
|
|
17,378 |
|
General and administrative expense |
|
57,746 |
|
|
|
55,258 |
|
|
|
56,134 |
|
Occupancy expense |
|
5,110 |
|
|
|
5,433 |
|
|
|
6,081 |
|
Depreciation and amortization |
|
9,443 |
|
|
|
9,922 |
|
|
|
10,026 |
|
Servicing expense |
|
8,261 |
|
|
|
8,572 |
|
|
|
4,834 |
|
Other interest expense |
|
46,547 |
|
|
|
45,484 |
|
|
|
43,090 |
|
Total expenses |
|
307,950 |
|
|
|
302,571 |
|
|
|
314,484 |
|
|
|
|
|
|
|
||||||
Loss before income taxes |
|
(85,165 |
) |
|
|
(73,945 |
) |
|
|
(106,583 |
) |
Income tax benefit |
|
(13,660 |
) |
|
|
(14,174 |
) |
|
|
(14,862 |
) |
Net loss |
|
(71,505 |
) |
|
|
(59,771 |
) |
|
|
(91,721 |
) |
Net loss attributable to noncontrolling interests |
|
(37,250 |
) |
|
|
(32,578 |
) |
|
|
(48,814 |
) |
Net loss attributable to loanDepot, Inc. |
$ |
(34,255 |
) |
|
$ |
(27,193 |
) |
|
$ |
(42,907 |
) |
|
|
|
|
|
|
||||||
Basic loss per share |
$ |
(0.19 |
) |
|
$ |
(0.15 |
) |
|
$ |
(0.25 |
) |
Diluted loss per share |
$ |
(0.19 |
) |
|
$ |
(0.16 |
) |
|
$ |
(0.25 |
) |
|
|
|
|
|
|
||||||
Weighted average shares outstanding |
|
|
|
|
|
||||||
Basic |
|
181,407,353 |
|
|
|
178,888,225 |
|
|
|
170,809,818 |
|
Diluted |
|
324,679,090 |
|
|
|
326,288,272 |
|
|
|
170,809,818 |
|
Consolidated Balance Sheets |
|||||
($ in thousands) |
Mar 31,
|
|
Dec 31,
|
||
|
(Unaudited) |
|
|
||
ASSETS |
|
|
|
||
Cash and cash equivalents |
$ |
603,663 |
|
$ |
660,707 |
Restricted cash |
|
74,346 |
|
|
85,149 |
Loans held for sale, at fair value |
|
2,300,058 |
|
|
2,132,880 |
Derivative assets, at fair value |
|
64,055 |
|
|
93,574 |
Servicing rights, at fair value |
|
1,985,948 |
|
|
1,999,763 |
Trading securities, at fair value |
|
91,545 |
|
|
92,901 |
Property and equipment, net |
|
66,160 |
|
|
70,809 |
Operating lease right-of-use asset |
|
27,409 |
|
|
29,433 |
Loans eligible for repurchase |
|
748,476 |
|
|
711,371 |
Investments in joint ventures |
|
17,849 |
|
|
20,363 |
Other assets |
|
213,761 |
|
|
254,098 |
Total assets |
$ |
6,193,270 |
|
$ |
6,151,048 |
|
|
|
|
||
LIABILITIES AND EQUITY |
|
|
|
||
LIABILITIES: |
|
|
|
||
Warehouse and other lines of credit |
$ |
2,069,619 |
|
$ |
1,947,057 |
Accounts payable and accrued expenses |
|
367,457 |
|
|
379,971 |
Derivative liabilities, at fair value |
|
11,233 |
|
|
84,962 |
Liability for loans eligible for repurchase |
|
748,476 |
|
|
711,371 |
Operating lease liability |
|
45,324 |
|
|
49,192 |
Debt obligations, net |
|
2,313,819 |
|
|
2,274,011 |
Total liabilities |
|
5,555,928 |
|
|
5,446,564 |
EQUITY: |
|
|
|
||
Total equity |
|
637,342 |
|
|
704,484 |
Total liabilities and equity |
$ |
6,193,270 |
|
$ |
6,151,048 |
Loan Origination and Sales Data |
|||||||||
($ in thousands) (Unaudited) |
|
Three Months Ended |
|||||||
|
Mar 31,
|
|
Dec 31,
|
|
Mar 31,
|
||||
Loan origination volume by type: |
|
|
|
|
|
|
|||
Conventional conforming |
|
$ |
2,545,203 |
|
$ |
2,830,776 |
|
$ |
2,893,821 |
FHA/VA/USDA |
|
|
1,654,025 |
|
|
2,062,928 |
|
|
1,678,591 |
Jumbo |
|
|
75,794 |
|
|
81,591 |
|
|
131,066 |
Other |
|
|
283,329 |
|
|
395,413 |
|
|
240,859 |
Total |
|
$ |
4,558,351 |
|
$ |
5,370,708 |
|
$ |
4,944,337 |
|
|
|
|
|
|
|
|||
Loan origination volume by purpose: |
|
|
|
|
|
|
|||
Purchase |
|
$ |
3,296,273 |
|
$ |
4,071,761 |
|
$ |
3,512,771 |
Refinance - cash out |
|
|
1,143,682 |
|
|
1,221,538 |
|
|
1,324,239 |
Refinance - rate/term |
|
|
118,396 |
|
|
77,409 |
|
|
107,327 |
Total |
|
$ |
4,558,351 |
|
$ |
5,370,708 |
|
$ |
4,944,337 |
|
|
|
|
|
|
|
|||
Loans sold: |
|
|
|
|
|
|
|||
Servicing retained |
|
$ |
2,986,541 |
|
$ |
3,825,478 |
|
$ |
3,277,707 |
Servicing released |
|
|
1,452,812 |
|
|
1,572,369 |
|
|
2,118,874 |
Total |
|
$ |
4,439,353 |
|
$ |
5,397,847 |
|
$ |
5,396,581 |
First Quarter Earnings Call
Management will host a conference call and live webcast today at 5:00 p.m. ET on loanDepot’s Investor Relations website, investors.loandepot.com, to discuss its earnings results.
The conference call can also be accessed by dialing (800) 715-9871, Conference ID: 9881136. Please call five minutes in advance to ensure that you are connected prior to the call. A webcast can also be accessed at https://events.q4inc.com/attendee/481232474.
A replay of the webcast will be made available on the Investor Relations website following the conclusion of the event.
For more information about loanDepot, please visit the company’s Investor Relations website: investors.loandepot.com.
Non-GAAP Financial Measures
To provide investors with information in addition to our results as determined by GAAP, we disclose certain non-GAAP measures to assist investors in evaluating our financial results. We believe these non-GAAP measures provide useful information to investors regarding our results of operations because each measure assists both investors and management in analyzing and benchmarking the performance and value of our business. They facilitate company-to-company operating performance comparisons by backing out potential differences caused by variations in hedging strategies, changes in valuations, capital structures (affecting interest expense on non-funding debt), taxation, the age and book depreciation of facilities (affecting relative depreciation expense), and other cost or benefit items which may vary for different companies for reasons unrelated to operating performance. These non-GAAP measures include our Adjusted Total Revenue, Adjusted Net Income (Loss), Adjusted Diluted Earnings (Loss) Per Share (if dilutive), and Adjusted EBITDA (LBITDA). We exclude from these non-GAAP financial measures the change in fair value of MSRs and related hedging gains and losses as they represent non-cash, unrealized adjustments resulting from changes in valuation assumptions, mostly due to changes in market interest rates, and are not indicative of the Company’s operating performance or results of operation. We also exclude stock-based compensation expense, which is a non-cash expense, expenses directly related to the Cybersecurity Incident, net of expected insurance recoveries, including costs to investigate and remediate the Cybersecurity Incident, the costs of customer notifications and identity protection, professional fees and commission guarantees (but does not include ongoing costs such as associated litigation expenses), gains or losses on extinguishment of debt and disposal of fixed assets, non-cash goodwill impairment, and other impairment charges to intangible assets and operating lease right-of-use assets, as well as certain costs associated with our restructuring efforts, as management does not consider these costs to be indicative of our performance or results of operations. Adjusted EBITDA (LBITDA) includes interest expense on funding facilities, which are recorded as a component of “net interest income (expense),” as these expenses are a direct operating expense driven by loan origination volume. By contrast, interest expense on our non-funding debt is a function of our capital structure and is therefore excluded from Adjusted EBITDA (LBITDA). Adjustments for income taxes are made to reflect historical results of operations on the basis that it was taxed as a corporation under the Internal Revenue Code, and therefore subject to
- they do not reflect every cash expenditure, future requirements for capital expenditures or contractual commitments;
- Adjusted EBITDA (LBITDA) does not reflect the significant interest expense or the cash requirements necessary to service interest or principal payment on our debt;
- although depreciation and amortization are non-cash charges, the assets being depreciated and amortized will often have to be replaced or require improvements in the future, and Adjusted Total Revenue, Adjusted Net Income (Loss), and Adjusted EBITDA (LBITDA) do not reflect any cash requirement for such replacements or improvements; and
- they are not adjusted for all non-cash income or expense items that are reflected in our statements of cash flows.
Because of these limitations, Adjusted Total Revenue, Adjusted Net Income (Loss), Adjusted Diluted Earnings (Loss) Per Share, and Adjusted EBITDA (LBITDA) are not intended as alternatives to total revenue, net income (loss), net income (loss) attributable to the Company, or Diluted Earnings (Loss) Per Share or as an indicator of our operating performance and should not be considered as measures of discretionary cash available to us to invest in the growth of our business or as measures of cash that will be available to us to meet our obligations. We compensate for these limitations by using Adjusted Total Revenue, Adjusted Net Income (Loss), Adjusted Diluted Earnings (Loss) Per Share, and Adjusted EBITDA (LBITDA) along with other comparative tools, together with
Reconciliation of Total Revenue to Adjusted Total Revenue ($ in thousands) (Unaudited) |
|
Three Months Ended |
|||||||
|
Mar 31,
|
|
Dec 31,
|
|
Mar 31,
|
||||
Total net revenue |
|
$ |
222,785 |
|
$ |
228,626 |
|
$ |
207,901 |
Change in fair value of servicing rights, net of hedging gains and losses(1) |
|
|
8,075 |
|
|
22,824 |
|
|
18,289 |
Adjusted total revenue |
|
$ |
230,860 |
|
$ |
251,450 |
|
$ |
226,190 |
(1) |
Represents the change in the fair value of servicing rights due to changes in valuation inputs or assumptions, net of gains or losses from derivatives hedging servicing rights. |
Reconciliation of Net Income (Loss) to Adjusted Net Income (Loss) ($ in thousands) (Unaudited) |
|
Three Months Ended |
||||||||||
|
Mar 31,
|
|
Dec 31,
|
|
Mar 31,
|
|||||||
Net loss attributable to loanDepot, Inc. |
|
$ |
(34,255 |
) |
|
$ |
(27,193 |
) |
|
$ |
(42,907 |
) |
Net loss from the pro forma conversion of Class C common shares to Class A common stock (1) |
|
|
(37,250 |
) |
|
|
(32,578 |
) |
|
|
(48,814 |
) |
Net loss |
|
|
(71,505 |
) |
|
|
(59,771 |
) |
|
|
(91,721 |
) |
Adjustments to the benefit for income taxes(2) |
|
|
9,774 |
|
|
|
7,776 |
|
|
|
13,316 |
|
Tax-effected net loss from the pro forma conversion of Class C common shares to Class A common stock |
|
|
(61,731 |
) |
|
|
(51,995 |
) |
|
|
(78,405 |
) |
Change in fair value of servicing rights, net of hedging gains and losses(3) |
|
|
8,075 |
|
|
|
22,824 |
|
|
|
18,289 |
|
Stock-based compensation expense |
|
|
4,855 |
|
|
|
6,375 |
|
|
|
5,926 |
|
Restructuring charges(4) |
|
|
3,961 |
|
|
|
3,517 |
|
|
|
1,746 |
|
Cybersecurity incident(5) |
|
|
14,698 |
|
|
|
— |
|
|
|
— |
|
(Gain) loss on disposal of fixed assets |
|
|
(29 |
) |
|
|
325 |
|
|
|
261 |
|
Other (recovery) impairment |
|
|
(1 |
) |
|
|
455 |
|
|
|
(345 |
) |
Tax effect of adjustments(6) |
|
|
(7,939 |
) |
|
|
(8,161 |
) |
|
|
(6,449 |
) |
Adjusted net loss |
|
$ |
(38,111 |
) |
|
$ |
(26,660 |
) |
|
$ |
(58,977 |
) |
(1) |
Reflects net loss to Class A common stock and Class D common stock from the pro forma exchange of Class C common stock. |
|
(2) |
loanDepot, Inc. is subject to federal, state and local income taxes. Adjustments to income tax benefit reflect the effective income tax rates below, and the pro forma assumption that loanDepot, Inc. owns |
|
|
Three Months Ended |
|||||||
|
Mar 31,
|
|
Dec 31,
|
|
Mar 31,
|
||||
Statutory |
|
21.00 |
% |
|
21.00 |
% |
|
21.00 |
% |
State and local income taxes (net of federal benefit) |
|
5.24 |
% |
|
2.87 |
% |
|
6.28 |
% |
Effective income tax rate |
|
26.24 |
% |
|
23.87 |
% |
|
27.28 |
% |
(3) |
Represents the change in the fair value of servicing rights due to changes in valuation inputs or assumptions, net of gains or losses from derivatives hedging servicing rights. |
|
(4) |
Reflects employee severance expense and professional services associated with restructuring efforts subsequent to the announcement of Vision 2025 in July 2022. |
|
(5) |
Represents expenses directly related to the Cybersecurity Incident, net of expected insurance recoveries, including costs to investigate and remediate the cybersecurity incident, the costs of customer notifications and identity protection, professional fees and commission guarantees (but does not include ongoing costs such as associated litigation expenses). |
|
(6) |
Amounts represent the income tax effect using the aforementioned effective income tax rates, excluding certain discrete tax items. |
Reconciliation of Adjusted Diluted Weighted Average Shares Outstanding to Diluted Weighted Average Shares Outstanding ($ in thousands except per share data) (Unaudited) |
|
Three Months Ended |
||||||||||
|
Mar 31,
|
|
Dec 31,
|
|
Mar 31,
|
|||||||
Net loss attributable to loanDepot, Inc. |
|
$ |
(34,255 |
) |
|
$ |
(27,193 |
) |
|
$ |
(42,907 |
) |
Adjusted net loss |
|
|
(38,111 |
) |
|
|
(26,660 |
) |
|
|
(58,977 |
) |
|
|
|
|
|
|
|
||||||
Share Data: |
|
|
|
|
|
|
||||||
Diluted weighted average shares of Class A and Class D common stock outstanding |
|
|
324,679,090 |
|
|
|
326,288,272 |
|
|
|
170,809,818 |
|
Assumed pro forma conversion of weighted average Class C shares to Class A common stock (1) |
|
|
— |
|
|
|
— |
|
|
|
149,210,417 |
|
Adjusted diluted weighted average shares outstanding |
|
|
324,679,090 |
|
|
|
326,288,272 |
|
|
|
320,020,235 |
|
(1) |
Reflects the assumed pro forma exchange and conversion of anti-dilutive Class C common shares. For the three months ended March 31, 2024 and December 31, 2023, Class C common shares were dilutive and included in diluted weighted average shares of Class A common stock outstanding in the table above. |
Reconciliation of Net Income (Loss) to Adjusted EBITDA (LBITDA) ($ in thousands) (Unaudited) |
|
Three Months Ended |
||||||||||
|
Mar 31,
|
|
Dec 31,
|
|
Mar 31,
|
|||||||
Net loss |
|
$ |
(71,505 |
) |
|
$ |
(59,771 |
) |
|
$ |
(91,721 |
) |
Interest expense - non-funding debt (1) |
|
|
46,547 |
|
|
|
45,484 |
|
|
|
43,090 |
|
Income tax benefit |
|
|
(13,660 |
) |
|
|
(14,174 |
) |
|
|
(14,862 |
) |
Depreciation and amortization |
|
|
9,443 |
|
|
|
9,922 |
|
|
|
10,026 |
|
Change in fair value of servicing rights, net of hedging gains and losses(2) |
|
|
8,075 |
|
|
|
22,824 |
|
|
|
18,289 |
|
Stock-based compensation expense |
|
|
4,855 |
|
|
|
6,375 |
|
|
|
5,926 |
|
Restructuring charges |
|
|
3,961 |
|
|
|
3,517 |
|
|
|
1,746 |
|
Cybersecurity incident(3) |
|
|
14,698 |
|
|
|
— |
|
|
|
— |
|
(Gain) loss on disposal of fixed assets |
|
|
(29 |
) |
|
|
325 |
|
|
|
261 |
|
Other (recovery) impairment |
|
|
(1 |
) |
|
|
455 |
|
|
|
(345 |
) |
Adjusted EBITDA (LBITDA) |
|
$ |
2,384 |
|
|
$ |
14,957 |
|
|
$ |
(27,590 |
) |
(1) |
Represents other interest expense, which includes gain on extinguishment of debt and amortization of debt issuance costs, in the Company’s consolidated statements of operations. |
|
(2) |
Represents the change in the fair value of servicing rights due to changes in valuation inputs or assumptions, net of gains or losses from derivatives hedging servicing rights. |
|
(3) |
Represents expenses, directly related to the cyber incident, net of expected insurance recoveries, that occurred in the first quarter of 2024, including costs to investigate and remediate the cybersecurity incident, the costs of customer notifications and identity protection, as well as related professional fees and commission guarantees (but does not include ongoing costs such as associated litigation expenses). |
Forward-Looking Statements
This press release may contain "forward-looking statements," which reflect loanDepot's current views with respect to, among other things, our business strategies, including the Vision 2025 plan, including our expanded productivity program, our progress toward run-rate profitability, our HELOC product, financial condition and liquidity, competitive position, industry and regulatory environment, potential growth opportunities, the effects of competition, the impact of the cybersecurity incident that occurred in the first quarter of 2024, operations and financial performance. You can identify these statements by the use of words such as "outlook," "potential," "continue," "may," "seek," "approximately," "predict," "believe," "expect," "plan," "intend," "estimate," “project,” or "anticipate" and similar expressions or the negative versions of these words or comparable words, as well as future or conditional verbs such as "will," "should," "would" and "could." These forward-looking statements are based on current available operating, financial, economic and other information, and are not guarantees of future performance and are subject to risks, uncertainties and assumptions, including but not limited to, the following: our ability to achieve the expected benefits of our Vision 2025 plan and the success of our cost-reduction initiatives, such as the expanded productivity program; our ability to achieve run-rate profitability; our loan production volume; our ability to maintain an operating platform and management system sufficient to conduct our business; our ability to maintain warehouse lines of credit and other sources of capital and liquidity; impacts of cybersecurity incidents, cyberattacks, information or security breaches and technology disruptions or failures, of ours or of our third party vendors; the outcome of legal proceedings to which we are a party; adverse changes in macroeconomic and
About loanDepot
loanDepot (NYSE: LDI) is a leading provider of lending solutions that make the American dream of homeownership more accessible and achievable for all, especially the increasingly diverse communities of first-time homebuyers, through a broad suite of lending and real estate services that simplify one of life's most complex transactions. Since its launch in 2010, the company has been recognized as an innovator, using its industry-leading technology to deliver a superior customer experience. Our digital-first approach makes it easier, faster and less stressful to purchase or refinance a home. Today, as one of the largest non-bank lenders in the country, loanDepot and its mellohome operating unit offer an integrated platform of lending, loan servicing, real estate and home services that support customers along their entire homeownership journey. Headquartered in
LDI-IR
View source version on businesswire.com: https://www.businesswire.com/news/home/20240507790470/en/
Investor Relations Contact:
Gerhard Erdelji
Senior Vice President, Investor Relations
(949) 822-4074
gerdelji@loandepot.com
Media Contact:
Rebecca Anderson
Senior Vice President, Communications & Public Relations
(949) 822-4024
rebeccaanderson@loandepot.com
Source: loanDepot, Inc.
FAQ
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