Empowering Commercial Real Estate Buyers and Sellers with Hubzu's Proven Auction Experience and ExpertiseLUXEMBOURG, March 24, 2025 (GLOBE NEWSWIRE) -- Altisource Portfolio Solutions S.A. (“Altisource®” or the “Company”) (NASDAQ: ASPS), a leading solutions provider for the real estate and mortgage industries, proudly announces that Hubzu®, a leading online real estate marketplace, has entered the commercial real estate market. Leveraging its extensive experience in real estate transactions and auctions, Hub ...

Financial Data and Key Metrics Changes - For 2024, the company generated $150 million in service revenue, a 10% increase over 2023, driven by growth in both business segments [8][10] - Adjusted EBITDA for 2024 was $17.4 million, representing an $18.3 million improvement over 2023 [8][10] - The company reduced its debt by over $60 million, from $233 million to $172.5 million, significantly strengthening its balance sheet [12][14] Business Line Data and Key Metrics Changes - The Servicer and Real Estate segment reported service revenue of $120 million, an 11% increase from 2023, with adjusted EBITDA of $42.1 million, up $5 million or 14% [17][18] - The Origination segment achieved service revenue of $30.4 million, a 6% increase from 2023, with adjusted EBITDA improving by $5.4 million to $2.5 million [20][21] - The Corporate segment's adjusted EBITDA loss decreased by $7.9 million or 22% to $27.2 million, reflecting efficiency initiatives [22] Market Data and Key Metrics Changes - Foreclosure starts in 2024 were 35% lower than 2019 levels, and foreclosure sales were 53% lower than 2019 levels, indicating a challenging market environment [23] - The origination market faced difficulties, with 2024 mortgage origination volume 35% lower than 2019 levels, primarily due to higher interest rates [24] Company Strategy and Development Direction - The company aims to diversify its revenue base and ramp up business won while maintaining cost discipline and significantly reducing corporate interest expense [28] - Focus areas for growth include the renovation business, Lenders One solutions, and expanding the Hubzu platform to include commercial auctions [38][40] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism for 2025, forecasting service revenue between $165 million and $185 million, representing 16% annual growth, and adjusted EBITDA of $18 million to $23 million [26][27] - The company anticipates positive operating cash flow for the first time since 2019, driven by sales wins and improved margins [26][27] Other Important Information - The company completed a significant transaction with lenders in February 2025, which is expected to be accretive to pre-transaction shareholders in the medium to long term [16][28] - The interest rate on the new term loan and super senior credit facility is SOFR plus 650 basis points, resulting in a substantial reduction in annual cash interest costs [12][13] Q&A Session Summary Question: Can you comment on the nature of some of the wins you've had across originations and servicing? - Management highlighted successful initiatives in the construction renovation and Lenders One businesses, with both achieving over $1 million a month in revenue [34][35] Question: How are things trending thus far in 2025? - Management reported a strong start to 2025, with January revenue and EBITDA results aligning with plans, and February revenue also on target [42][43] Question: When do you think the increase in foreclosure starts will be reflected in results? - Management noted that while they are being conservative in forecasting, anecdotal evidence suggests clients expect an increase in foreclosure starts [48][50] Question: Are there other agencies implementing unfriendly creditor policies that might impact the business? - Management mentioned the FHA's new programs and indicated that borrowers are continuing to default on modified loans, which could lead to increased business in the future [54][56] Question: Will there be a sizable gain in Q1 that could reduce the negative equity position on the balance sheet? - Management confirmed that interest expense will decrease significantly, and they expect strong revenue and EBITDA results in Q1 [60][62]

Financial Performance - For 2024, the company generated $150 million in service revenue, a 10% increase over 2023, driven by growth in both business segments [8][10] - Total adjusted EBITDA for 2024 was $17.4 million, representing an $18.3 million improvement over 2023, largely from service revenue growth and higher adjusted EBITDA margins [8][10] - The business segments generated $44.6 million of adjusted EBITDA at 29.7% margins, reflecting a $10.4 million improvement and a 462 basis points increase in margins compared to 2023 [9][10] - The corporate segment's adjusted EBITDA loss declined by $7.9 million or 22% to $27.2 million, primarily due to efficiency initiatives [10][22] Business Segment Performance - The Servicer and Real Estate segment had service revenue of $120 million, an 11% increase from 2023, with adjusted EBITDA of $42.1 million, up $5 million or 14% [17][18] - The Origination segment reported service revenue of $30.4 million, a 6% increase from 2023, with adjusted EBITDA improving by $5.4 million to $2.5 million [20][21] - The corporate segment's adjusted EBITDA loss improved due to cost savings and efficiency initiatives [22] Market Conditions - The default market has faced challenges, with 2024 foreclosure starts 35% lower than 2019 levels and 6% lower than 2023 [23] - The origination market also struggled, with 2024 mortgage origination volume 35% lower than 2019 levels, although it was higher than 2023 due to refinance activity [24] Company Strategy and Outlook - The company aims to diversify its revenue base and ramp up business won while maintaining cost discipline and reducing corporate interest expense [28] - For 2025, the company forecasts service revenue between $165 million and $185 million, representing 16% growth, and adjusted EBITDA of $18 million to $23 million, indicating 18% growth [26][27] - The company is focusing on accelerating growth in certain businesses that have favorable market conditions and expects to benefit from a return to normalcy in the default market [28] Management Commentary - Management expressed optimism about the company's strong start to 2025, with January revenue and EBITDA results exceeding expectations [42] - The company is monitoring market conditions closely, particularly regarding delinquency rates and potential increases in foreclosure starts [50][51] Other Important Information - In February 2025, the company executed a transaction with lenders that significantly strengthened its balance sheet, reducing debt from $233 million to $172.5 million [12][14] - The interest rate on the new term loan is SOFR plus 650 basis points, resulting in a significant reduction in annual cash interest costs [13][62] Q&A Session Summary Question: Can you comment on the nature of some of the wins you've had across originations and servicing? - Management highlighted successful initiatives in the construction renovation and Lenders One origination businesses, with both achieving over $1 million in monthly revenue [34][36] Question: How are things trending thus far in 2025? - Management reported a strong start to the year, with January revenue and EBITDA results aligning with or exceeding plans [42] Question: When do you expect foreclosure starts to impact results? - Management noted that while they are being conservative in forecasting, there are indications from clients that foreclosure starts may increase [48][50] Question: Are there other agencies implementing policies that might impact the business? - Management mentioned the FHA's new programs and the potential for increased delinquencies as borrowers exhaust modification options [54][56] Question: Will there be a sizable gain in Q1 that could reduce negative equity? - Management indicated that while interest expenses will decrease significantly, they are still finalizing accounting related to the recent transaction [60][62]

Financial Performance Highlights - Altisource's service revenue increased by 10% to $150.4 million in 2024 compared to $136.6 million in 2023[14, 49] - Adjusted EBITDA improved by $18.3 million to $17.4 million in 2024, compared to a loss of $0.9 million in 2023[9, 14, 49] - Business Segments generated $44.6 million of Adjusted EBITDA at 29.7% Adjusted EBITDA margins, representing a $10.4 million improvement and a 462-basis points margin improvement[14] - Corporate Adjusted EBITDA loss declined by $7.9 million, or 22%, to $27.2 million, primarily from efficiency initiatives[14] - Q4 2024 service revenue reached $38.4 million, the highest since Q3 2021, with Adjusted EBITDA at $4.7 million, the strongest quarter since Q3 2020[16] Debt Restructuring - Altisource executed a Term Loan Exchange Transaction, reducing debt by over $60 million from $232.8 million to $172.5 million[9, 18] - The Term Loan Exchange Transaction reduced annual cash and payment-in-kind interest by approximately $18 million to $13.4 million[18] - The company also closed on a $12.5 million super senior credit facility to fund transaction costs and for general corporate purposes[18, 21] Segment Performance - Servicer and Real Estate segment service revenue increased by 11% to $119.9 million in 2024 compared to $107.8 million in 2023[23] - Servicer and Real Estate segment Adjusted EBITDA increased by 14% to $42.1 million in 2024 compared to $37.1 million in 2023, with margins improving to 35.1% from 34.4%[23] - Origination segment service revenue grew by 6% to $30.4 million in 2024 compared to $28.8 million in 2023[29, 31] - Origination segment Adjusted EBITDA improved by $5.4 million to $2.5 million in 2024 compared to a loss of $2.9 million in 2023[29, 31] 2025 Financial Guidance - Altisource anticipates service revenue between $165 million and $185 million and Adjusted EBITDA between $18 million and $23 million in 2025[42] - The guidance midpoint represents 16% annual service revenue and 18% Adjusted EBITDA growth over 2024[42] - The company expects positive operating cash flow in 2025[41, 43]

Company Performance - In 2024, the company achieved a total Service revenue of $150.4 million, representing a 10% increase from 2023, and an Adjusted EBITDA of $17.4 million, which was $18.3 million higher than the previous year [4][7] - The fourth quarter of 2024 saw Service revenue of $38.4 million, a 19% increase compared to the same quarter in 2023, marking the highest quarterly Service revenue since Q3 2021 [4][6] - The company ended 2024 with $29.8 million in cash and cash equivalents [4] Financial Highlights - The Adjusted EBITDA margin improved to 29.7% in 2024 from 25.1% in 2023, driven by efficiency initiatives and cost savings [4][7] - The company reported a net loss attributable to Altisource of $(35.6) million for the full year 2024, a 37% improvement compared to $(56.3) million in 2023 [8][7] - The diluted loss per share decreased to $(1.25) in 2024 from $(2.51) in 2023, reflecting a 50% improvement [8][7] Business Segments - Service revenue in the Servicer and Real Estate segment increased by 11% to $120 million, while the Origination segment saw a 6% increase to $30 million [7] - The company generated estimated potential annualized Service revenue of $25.8 million from sales wins in the Servicer and Real Estate segment and $13.6 million in the Origination segment [7] Market Outlook - For 2025, the company is guiding Service revenue between $165 million and $185 million, and Adjusted EBITDA between $18 million and $23 million, indicating a projected growth of 16% in Service revenue and 18% in Adjusted EBITDA compared to 2024 [3][2] - The company anticipates maintaining cost discipline while diversifying its revenue base and ramping up business won [3][2]

Revenue Performance - Altisource reported a 10% increase in total Company Service revenue, reaching $150.4 million in 2024 compared to 2023[5]. - In Q4 2024, Service revenue was $38.4 million, a 19% increase from Q4 2023, marking the highest quarterly revenue since Q3 2021[5]. - The Servicer and Real Estate segment saw an 11% increase in Service revenue to $120 million, while the Origination segment increased by 6% to $30 million[6]. - The Company expects 2025 Service revenue to be between $165 million and $185 million, representing a projected 16% growth over 2024[4]. EBITDA and Profitability - Adjusted EBITDA for the full year 2024 was $17.4 million, an increase of $18.3 million from 2023, with margins improving to 29.7% from 25.1%[5]. - Altisource's Adjusted EBITDA guidance for 2025 is between $18 million and $23 million, indicating an 18% growth compared to 2024[4]. - For the year ended December 31, 2024, Altisource reported an adjusted operating income of $14,821,000, compared to an adjusted operating loss of $(2,282,000) for 2023[29]. - Adjusted EBITDA for the year ended December 31, 2024, was $17,387,000, compared to an adjusted EBITDA of $(909,000) for 2023, indicating a significant turnaround[29]. - The business segments adjusted EBITDA for the year ended December 31, 2024, was $44,607,000, compared to $34,212,000 in 2023, reflecting a 30.5% increase[31]. Cash and Debt Management - The Company ended 2024 with $29.8 million in cash and cash equivalents[5]. - A Term Loan Exchange Transaction was executed, reducing annual cash interest expenses by approximately $18 million[6]. - Cash and cash equivalents decreased to $29,811 million as of December 31, 2024, down from $32,522 million in 2023[18]. - The net debt as of December 31, 2024, was $202,989 thousand, an increase from $191,563 thousand at the end of 2023[35]. Losses and Improvements - Net loss attributable to Altisource for the year 2024 was $35,636 million, an improvement from a net loss of $56,290 million in 2023[16]. - The company reported a comprehensive loss of $8,769 million in Q4 2024, compared to a comprehensive loss of $13,151 million in Q4 2023[16]. - The net loss attributable to Altisource for the year ended December 31, 2024, was $(35,636,000), a decrease from $(56,290,000) in 2023, representing a 36.7% improvement[31]. - The company reported a loss before income taxes and non-controlling interests of $(32,867,000) for 2024, down from $(52,348,000) in 2023, reflecting a 37.1% reduction[29]. Operating Activities - Net cash used in operating activities for 2024 was $(5,025) million, a significant improvement from $(21,833) million in 2023[20]. - The company reported a net cash used in operating activities of $(1,401) thousand for the three months ended December 31, 2024, an improvement from $(4,238) thousand in the same period of 2023[35]. Tax and Amortization - Altisource's effective tax rate in Luxembourg is close to 0% for 2023 and 2024 due to a full valuation allowance on net deferred tax assets recognized in 2019[23]. - The company incurred $5,080,000 in intangible asset amortization expense for the year ended December 31, 2024, consistent with the previous year[29]. - The total intangible asset amortization expense for the year ended December 31, 2024, was $5,080 thousand, slightly down from $5,182 thousand in 2023[33]. Share-Based Compensation - Share-based compensation expense for the year ended December 31, 2024, was $4,737,000, down from $5,069,000 in 2023, indicating a 6.6% decrease[29]. - Share-based compensation expense, net of tax, for the year ended December 31, 2024, was $4,122 thousand, down from $4,409 thousand in 2023[33].

Core Viewpoint - Altisource Portfolio Solutions S.A. is set to report its earnings for the fourth quarter and full year of 2024 on March 13, 2025, with a press release and presentation available on its website [1]. Group 1: Earnings Report - The earnings report will cover both the fourth quarter and the full year of 2024 [1]. - A conference call is scheduled for 8:30 a.m. EDT on the same day to discuss the results [2]. - A live audio webcast of the conference call will be accessible on Altisource's website, with a replay available approximately two hours after the call [2]. Group 2: Company Overview - Altisource Portfolio Solutions S.A. operates as an integrated service provider and marketplace for the real estate and mortgage industries [3]. - The company combines operational excellence with innovative services and technologies to address the demands of changing markets [3].

Core Insights - Lenders One Cooperative is celebrating its 25th anniversary at the annual summit in Cancun, Mexico, highlighting its commitment to supporting independent mortgage bankers, banks, and credit unions [1][5] - Since March 2024, Lenders One has added 39 new members and enhanced its service offerings to help members increase profitability and improve decision-making [2][5] - The cooperative's members collectively originated approximately $372 billion in mortgages during 2023, making it the largest retail mortgage entity in the U.S. [6] Membership and Growth - The addition of 39 new members reflects the value proposition of Lenders One amid a challenging mortgage origination environment [2] - The cooperative continues to focus on maximizing revenue, reducing costs, and sharing best practices among its members [6] Service Offerings - Lenders One provides a variety of direct solutions, including credit, flood, fraud, insurance, verifications, fulfillment services, quality control, title and escrow, valuations, and vendor management [3] - Recent enhancements to direct solutions include: - ScoreNavigator® for detailed credit health analysis [4] - L1 Verification of Assets powered by FinLocker® for asset and payroll verification [4] - L1 Flood for flood zone determinations, now powered by ServiceLink® [4] - L1 Insurance for competitive homeowner insurance quotes [4] - Blend and Blue Sage for digital origination and lending platforms [4] Capital Markets and National Programs - Lenders One has expanded its Capital Markets and National Programs offerings, adding 8 new Preferred Providers to support various facets of the mortgage business [4] - The cooperative's suite of services aims to enhance competitiveness and profitability for its members [3][4]

Core Viewpoint - Altisource Portfolio Solutions S.A. has successfully completed a significant financial restructuring through the Term Loan Exchange Transactions and the establishment of a Super Senior Facility, aimed at strengthening its balance sheet and positioning the company for sustainable long-term growth and value creation [2][3][4] Financial Transactions - The Term Loan Exchange Transactions involved the exchange of $232.8 million in senior secured term loans for a new first lien loan of $160 million and approximately 58.2 million common shares [3][4] - The New Facility consists of a $110 million interest-bearing loan and a $50 million non-interest-bearing exit fee, with a maturity date of April 30, 2030 [5][6] - The Super Senior Facility, amounting to $12.5 million, was executed to fund transaction costs and for general corporate purposes, maturing on February 19, 2029 [4][6] Interest Rates and Repayment Terms - The interest rate on the New Debt is set at SOFR plus 6.50% per annum, with a 3.50% SOFR floor, while the Exit Fee carries a 0% interest rate [5][6] - Mandatory and voluntary prepayments under the New Facility will be allocated on a pro rata basis between the New Debt and the Exit Fee [5] - Beginning with the fiscal year ending December 31, 2025, a portion of the company's excess cash flow will be used to prepay the Super Senior Facility and the New Facility [6] Stakeholder Warrants - Shareholders approved the issuance of Stakeholder Warrants, allowing holders to purchase approximately 114.5 million shares of common stock at $1.20 per share [4][7] - Stakeholder Warrants will provide the ability to purchase approximately 3.25 shares for each share held, with different expiration dates for the two halves of the warrants [7] Future Reporting - Detailed descriptions of the Term Loan Exchange Transactions and the Super Senior Facility will be provided in a Current Report on Form 8-K to be filed by Altisource [8]

Core Points - Altisource Portfolio Solutions S.A. has successfully closed its Term Loan Exchange Transactions and entered into a $12.5 million Super Senior Facility, which is expected to strengthen its balance sheet and support long-term growth [1][2][3] Group 1: Term Loan Exchange Transactions - The Term Loan Exchange Transactions involved the exchange of $232.8 million in senior secured term loans for a new first lien loan of $160 million and approximately 58.2 million common shares [3] - The new facility consists of a $110 million interest-bearing loan and a $50 million non-interest-bearing exit fee [3][5] - A portion of the principal amount of the exchanged loans, approximately $1.4 million, matures on January 15, 2029 [4] Group 2: Super Senior Facility - The Super Senior Facility, executed on February 19, 2025, is intended to fund transaction costs related to the Term Loan Exchange and for general corporate purposes [4] - The maturity date of the Super Senior Facility is February 19, 2029, with an original issue discount of 10.0% [6] - The interest rate on the Super Senior Facility is SOFR plus 6.50% with a 3.50% SOFR floor [6] Group 3: Stakeholder Warrants - Shareholders approved the issuance of transferable warrants allowing stakeholders to purchase approximately 114.5 million shares of common stock at $1.20 per share [4][7] - Stakeholder Warrants will allow stakeholders to purchase approximately 3.25 shares for each share held, with half expiring on April 2, 2029, and the other half on April 30, 2032 [7] Group 4: Financial Terms and Conditions - The interest rate on the new debt is SOFR plus 6.50% per annum with a 3.50% SOFR floor, and the exit fee has an interest rate of 0% [5][6] - Mandatory and voluntary prepayments under the new facility will be allocated on a pro rata basis between the new debt and the exit fee [5] - Beginning with the fiscal year ending December 31, 2025, a portion of excess cash flow will be used for prepayment of the Super Senior Facility and the New Facility [5][6]