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]

Core Viewpoint - Altisource Portfolio Solutions S.A. announced a proposed issuance of transferable Warrants to its stakeholders, contingent upon shareholder approval and completion of related transactions [1][2]. Summary by Relevant Sections Warrant Distribution - The Warrant Distribution will occur within 60 days after the Distribution Record Date of February 14, 2025, with a potential Distribution Date by April 15, 2025 [2]. - The distribution is subject to shareholder approval of proposals outlined in the Proxy Statement filed with the SEC [1][2]. Terms of the Warrants - Stakeholders will receive two types of Warrants: Cash Exercise Stakeholder Warrants and Net Settle Stakeholder Warrants, each entitling the holder to purchase 1.625 shares of Common Stock at an initial exercise price of $1.95 per Warrant [3][6]. - The Company will not issue fractional shares; any fractional entitlement will be rounded down to the nearest whole number [3]. Listing and Agreement - The Company intends to apply for listing the Warrants on the Nasdaq Global Select Market, although approval is not guaranteed [4]. - The issuance of the Warrants will be governed by a Warrant Agent Agreement with Equiniti Trust Company, LLC [5]. Additional Information - Altisource is an integrated service provider for the real estate and mortgage industries, offering innovative services and technologies [8]. - Shareholders are encouraged to review the Proxy Statement and related documents for important information regarding the proposed transactions [9].

Core Viewpoint - Altisource Portfolio Solutions S.A. has entered into a binding transaction support agreement with lenders to restructure its existing debt, aiming to significantly improve its financial position and support long-term growth [1][2]. Debt Restructuring Details - The agreement will reduce the company's current outstanding debt obligations from $231 million to $172.5 million, a reduction of $58 million or 25% [2]. - The new debt structure includes an up to $110 million interest-bearing first lien loan, a $50 million non-interest-bearing exit fee, and a $12.5 million super senior credit facility [2]. - The maturity date of the new facility will be extended by five years to April 30, 2030 [2]. Financial Impact - The restructuring is expected to decrease the company's annual cash and paid-in-kind (PIK) interest by approximately $18 million, with cash interest reduced by about $9 million and PIK interest also reduced by approximately $9 million [2]. - The interest rate on the new debt and super senior facility is set at SOFR + 6.50%, compared to the existing term loans' rate of SOFR + 8.75% [2]. Equity and Warrants - Lenders under the new facility will receive approximately 57.9 million common shares of Altisource, representing 63.5% of the pro forma outstanding shares post-transaction [2]. - Existing shareholders and certain stakeholders will be granted warrants to purchase approximately 115 million common shares at an exercise price of $1.20 per share, potentially mitigating dilution from shares issued to lenders [2]. Management Commentary - The CEO expressed satisfaction with the transaction support agreement, highlighting that it would strengthen Altisource's balance sheet and position the company for sustainable long-term growth [2]. Additional Information - The transactions are subject to certain terms and conditions, including the negotiation and execution of definitive agreements and necessary approvals from the company's Board of Directors and shareholders [3]. - Further details are available in a presentation posted on the company's Investor Relations website [4].

Core Viewpoint - Altisource Portfolio Solutions S.A. has entered into a binding transaction support agreement with lenders to restructure its existing term loans, aiming to significantly improve its financial position and facilitate long-term growth [1][2]. Debt Restructuring - The agreement will reduce the company's current outstanding debt obligations from $231 million to $172.5 million, a decrease of $58 million or 25% [2]. - The new debt structure includes an up to $110 million term loan, a $50 million non-interest-bearing exit fee, and a $12.5 million super senior credit facility [1][2]. - The maturity date of the new facility will be extended by five years to April 30, 2030 [2]. Interest Expense Reduction - The annual cash and paid-in-kind (PIK) interest on outstanding debt will be reduced by approximately $18 million, with cash interest decreasing by about $9 million and PIK interest also decreasing by approximately $9 million [2]. - The interest rate on the new debt and super senior facility is set at SOFR + 6.50%, compared to SOFR + 8.75% on existing term loans [2]. Equity and Warrants - Lenders under the new facility will receive approximately 57.9 million common shares of Altisource, representing 63.5% of the pro forma outstanding shares post-transaction [2]. - Existing shareholders and certain stakeholders will be granted warrants to purchase approximately 115 million common shares at an exercise price of $1.20 per share, potentially mitigating dilution from shares issued to lenders [2]. Financial Performance - The company has improved its net cash used in operating activities by over $55 million since 2021, indicating a positive trend in financial performance [2]. - The restructuring is aimed at stabilizing the company and positioning it for sustainable long-term growth and value creation [2]. Additional Information - The transactions are subject to certain terms and conditions, including the negotiation and execution of definitive agreements and necessary approvals from the company's Board of Directors and shareholders [3]. - A presentation with further details has been made available on the company's Investor Relations website [4].

Financial Data and Key Metrics Changes - For Q3 2024, the company generated $38.2 million in service revenue, an increase of $4 million or 11.8% year-over-year, marking the strongest quarterly service revenue performance in 12 quarters [4] - Adjusted EBITDA for the quarter was $3.6 million, reflecting a $2.8 million improvement compared to Q3 2023, but an $800,000 decline from the previous quarter [4][5] - Year-to-date service revenue is $7.5 million higher than last year, with adjusted EBITDA up by $13.8 million, resulting in adjusted EBITDA margins improving to 11.3% compared to negative 1.1% for the same period in 2023 [6][13] Business Line Data and Key Metrics Changes - The servicer and real estate segment saw service revenue grow by 4.7% sequentially and 13% year-over-year, but adjusted EBITDA remained flat compared to last year and decreased by 10.6% from the previous quarter due to higher SG&A expenses [8] - The origination segment improved adjusted EBITDA by $1.4 million year-over-year, driven by cost savings and efficiency initiatives, with service revenue growth of $500,000 [11][12] - The renovation business, launched in late April 2024, has already generated $1.5 million in revenue in Q3, indicating rapid growth potential [19][20] Market Data and Key Metrics Changes - The average serious delinquency rate through August 2024 is 1.2%, which is 15% lower than the same period in 2019 and 2023, negatively impacting foreclosure starts and sales [11] - Foreclosure starts and sales are significantly lower than pre-pandemic levels, with current figures being 34% and 54% lower than 2019, and 7% and 14% lower than 2023 [11] Company Strategy and Development Direction - The company is focusing on diversifying revenue streams and customer base through the ramp-up of the renovation business and ongoing sales wins [13] - Management anticipates strong service revenue and adjusted EBITDA growth over 2023, despite challenges in the foreclosure market [7] Management's Comments on Operating Environment and Future Outlook - Management noted that the market is not performing as expected, with lower foreclosure starts and sales impacting business [16] - There are early signs of potential market normalization, but the company is preparing to benefit from any future upturn while diversifying revenue [32] Other Important Information - The company ended the quarter with cash and cash equivalents of $28.3 million [5] - The renovation business is expected to be a strong contributor to service revenue and EBITDA in the coming months and years [9] Q&A Session Summary Question: Understanding the pre-foreclosure work and renovations business - Management acknowledged that the market is underperforming, impacting foreclosure starts and sales, but they are successfully adding new clients in earlier-stage processes [16][17] Question: Insights on the renovations business - The renovations business has ramped up significantly, generating $1.5 million in Q3, and management expects continued growth as they onboard new customers [19][21] Question: Discussion on higher SG&A and legacy indemnity claims - Management explained that higher SG&A costs were due to professional services and bad debt, with a total impact of approximately $3 million compared to expectations [22][23] Question: Outlook for the origination business - Management noted a temporary pickup in origination volumes but indicated that the market remains challenging with high mortgage rates [24][25] Question: Revenue projections for the renovation business in 2025 - Management is optimistic about the renovation business's contribution but finds it difficult to model exact revenues due to variability in referrals [26][27] Question: Capacity and risk management in the renovation business - Management expressed confidence in their capacity to handle increased referrals and outlined risk management strategies for cost overruns [28][29] Question: Views on the foreclosure market and delinquencies - Management indicated that while the market has not turned yet, they believe it will eventually normalize, and they are positioning the company to benefit from that change [31][32]