Anywhere Real Estate (HOUS) 28 Jul 222022 Q2 Earnings call transcript

Good morning, and welcome to our second quarter 2022 earnings conference call and our first as Anywhere Real Estate.

Before we begin, Ryan Schneider will share perspective on our recent rebranding.

So I'm so excited about this, a powerful existing business, a new focus on the consumer, meeting homebuyers and sellers anywhere in their real estate journey from just starting to search to that incredible keys and hand moments and driving cultural change to deliver that future.

So I'm all in on it, right? And I'm actually -- I'm so committed to this that I want to signal this broader change to the world as our current brand and identity have not kept up with our company's transformation.

So now is the time to move our brand to what's next, and I'm excited to announce Realogy will become Anywhere Real Estate.

to Call Real via welcome XXXX Second and Conference Earnings webcast. morning, the Estate Anywhere Quarter Good Today's call section is will website be being recorded, and available tomorrow. the a in Investor Information of company's made the written transcript webcast the website. on made company's replay will A be available also newer time, like to this Danielle Kloeblen. the conference to At Director, turn I over would Senior Please go ahead, Danielle.

Real Thank Earnings Conference XXXX the Second Estate you, Inc. Quarter Abby. Good morning, and for welcome Anywhere to Call

Schneider; Anywhere the Financial and call Ryan with and On Chief are Charlotte CEO today Simonelli. Officer, President, me

As will shown and expectations statements are its and Slide the on statements X of current forward-looking be future the presentation, the current other during company These on about this economic call. making environment. statements based results

litigation, which uncertainties contingencies, demand. declining macroeconomic others, constrained Forward-looking well statements and affordability beyond projections are rising consumer are rates, other inherently the foregoing management, and competitive inflation many and regulatory including of subject inventory, on and control economic, as of the of to mortgage among the impact as and other concerns significant

Actual expressed in those statements. forward-looking or differ results the materially implied may from

could who remarks those as herein to For subsequent updated SEC today, earnings presentation, of initial quarterly not call. issued to of have XX, been and made release July today and assumptions differ materially are as results that in you the the our we our remind this earnings listen statements that actual annual and the from re-broadcast factors forward-looking Important to as cause specified those in are the filings. in well

Anywhere our Real followed naming XX, our July units, to Estate on company's which X. to on announced rebrand new Anywhere June conventions Finally, we Inc. or business

Anywhere are known Group; Realogy and to segments, which make Title as Brands, Group; formerly Realogy Group. Anywhere known call, our Franchise Brokerage today's as we will Services, Integrated known Realogy Advisors, Anywhere reference formerly formerly as During as reporting follows:

will over Ryan turn to call CEO and I Schneider. President, Now the our

Estate because Investor chapter our share our results and our call articulate first XXth and a Anywhere We that to earnings us future. our and of our gave May Day. Danielle. call Real Investor strategic first Day next earnings following it as to transformation powerful the company's for Welcome chapter of Thank to the you, chance first excited were

during said transaction, improved our leadership our balance and we luxury our real Investor As operating especially the mix performance our estate having we our businesses Day, sheet, across position. fortified of like

simplify concerns housing future for in rates a to And priority, were consumer mostly beyond to demand a substantially macroeconomic affordability, our existing the last record we're rising market, you has quarter, buyer the the out continuing been inflation change months experience and strengths, home. with since has in and they to shift double later broader we to and laid committed combined buyer continues And be the the in spoke the ago, June. changed we delivering seller and leverage few while that expectations. mortgage for saw buying biggest selling our especially reimagining nearly future in And increases the levels we the

a said points the changed XXX have clearly has more seen for rates basis industry rates, few the the XXX XX that we a historically, increase a XXX mortgage months, in has in big market. past remember, Now is to to like and basis which mortgage in points housing headwind increase

progress anywhere changing of have execute. our financial rapidly While we're and our strength well we to now in housing a strategic competitors positioned, many especially relative our market, to believe much more

increasingly those free in we cash flow and markets critical of valuing that you'll in So even generate tougher first, see metrics. housing believe like and our are QX profitability we results investors delivery

We we're leverage our delivered always and cycle all for parts on positioned housing liquidity our ratios progress, sheet have finally, of cost. the well balance our current and Second, low very us focused see during reduction markets this reduction market the we've as very X our cost past we housing programs cost housing consistent meaningfully plans the increased and even year, the for years changing. strong

markets, EBITDA share me in delivered QX. million QX billion We Now consistent $X.X and our strength this $XXX both with performance revenue good in and results. challenging of let in housing operating

While EBITDA this relative basis is still down both million record billion powerful a from in our revenue $XXX financial an and XXXX's competition. absolute in on $X.X operating and is result to

the EBITDA again that segment direct observed. on and greater million $XXX all weakening down our the and transaction from businesses operating demonstrated we've volume XXXX brokerage attractiveness and franchise $XX title like was frontline resilience. market effect housing and It's reflected our while Our market million only mortgage owned its headwinds

Our with volume quarter, XX%. down about was down the X% units year-over-year in

Our call to prior Advisers, Anywhere year. was transaction own flat business, brokerage volume which we now

Our by call difference Brands, and Anywhere to in business. volume $XX mix on shares used our to The cash franchise now of invest was the we down $XX business, meaningful We advisers discount million XXXX repurchase and one purchase geography the flow transaction in part our quarter driven of at cash greater $XX opportunistically was the by to bonds which hand for million of X%. to acquisition. continue free by million a in and luxury

Coldwell and it Our our X/X engagement, commitment homeplace the is consumer and we to driving. we Realty expanding is for last like spoke, of direct-to-consumer our expanded products to app footprint, we've delivering access Banker Since unchanged. more to consumers

better to commitment their consumers with products great and agents helping sell Our homes continues.

the amazing among of franchise product you over crossed much our Listing an Realty we at Investor And those threshold at listings. Day XX% love Day how For showcased Investor our adoption with business. Concierge Banker heard Coldwell we example,

Network $XX the networks. of we Franchise with and franchisees it Anywhere June, Realty income proud bring in largest the were luxury QX. In with network our the one income. into we addition expanding Realty a gross the International leading our billion Brands This second addition Sotheby's gross in ever had brokerage in Sotheby's in a help Network. of franchise franchise network largest Oregon to always volume any to great new result special sales is over $X.X our franchisees, commission Franchise to we're While the This addition brings and million International commission ever to new

in seeing housing we're what market. to now the shift me Let

are headlines while First, at year to a to versus relative always most The list price. ago. prices important thing is about cuts home look most price

Texas contract a data, we in previous moderation We XX% have X% New trend, up price from in places contracts places QX. and City, June see like California, of digits. though prices our only in Jersey. up most price growth years still had increases now markets, even flat in York EG open price and July and substantial is trend in like but Overall up, X and Florida And for New open plus has the That about in low-single double-digit price changed. price July

I'm late done. XXXX talking in expectations franchisees this The Second, down you're substantially changes opened April looking be in we worse agents seller expectations, market and data and at units creativity new accelerated, both year. June saw has about the is than the entered and estimated in trend in consistent is speed previous our we early hearing and demand and May. getting whether or That deals see versus happening, increase most buyer are what when which the talking with the And feedback And XXXX. at QX. we would July down XX% from contracts about especially

actions outlook. housing are rest business been But to additional with of our we forecast make what our together Now to looking is market we've transparency pretty provide pace you of doing like estimating what the the ahead, year, it in in seeing the change year. the volatility, the market tough and goal fed about all potential we're and

So will EBITDA, Charlotte commission be estimates our this cost sharing and in operating call. volume, later

even focused good and I about we this delivered flow. especially our come let we capital changing cash many details QX, remain ability rapidly over cost We more longer make to in our of out confident QX the business updated to to profitability shareholders. We close turn competitors. housing and we the first, our on and to a return our term. in estimates. deliver comments and market Charlotte But to financials, want to as on it discuss me and few grow back in invested relative So free remain future to more

morning, everyone. Good

Before we environment. business the in macro-backdrop an forward-looking how want results on remains the quarter, level current for get I ever-changing set into the and to our

we uncertainty are well with focused values and equipped have which agility said, remaining and us we objectives a to environment, made today's while responding to foundation, successful. volatility so Ryan navigate As strong and on have our long-term

are are net beneficiary challenges the naturally balance winners clearly will us. We and that the we advantage an in and liquidity be current we have as immune not to the market but can shown force landscape will for structure losers. believe market, a We flex ways sheet in and cost we strong our

staying us positions us have our of we we designed that strategy, business positions continued long-term to drive making while our An deliver the is capabilities for our combination The believe well. is culture and our investments our strong have to committed which model, improving The today cost of also success this focus made, decisions built we and structure. the is of regardless key strategic the example on value macro-environment. which

are We our cost structure cost about relentless of In conditions. have savings. market in XXXX, delivered on proven we million $XX regardless we

savings of savings. These of originally and we budgeted we $XX X cost full are But savings current north for buckets. have additional about temporary given targeted savings an total plus million of $XX XXXX, permanent cost in the million. For both million backdrop, additional year $XXX

to respond to shifts to our the and to that costs, semi-variable variable tied across our housing are rapidly First, right-size businesses. brokerage costs as in we moved including especially as well have market purely title volume,

have administrative QX office reimagine and we is Second, continue XX% to our we our almost retail footprint, footprint, reduced XXXX. office and which reduce since down

analytics structure use including other our advanced and tools, continue we Hyperion as administrative streamline of business and and to BI, analytics. cost automation RPA as well through technology Power support enhanced Finally,

profitability of in bonds the in before July, maturity and revolver and million this of extension billion is QX a Another and untapped gross a revolver, sheet of even balance have in have more cash remain the plans portion the over our our and to lower the on challenging facility. sheet at open $XX the lower for to generate financial believe executed a markets, extend address balance revolving market we credit maturity lot of or we a July notes debt free liquidity to purchasing extended these million we by with We to positive example maturity XXXX. stack, moved flexibility, than to outlook our despite an were $XXX the We started long-dated discount. And and We advantage. attractive and of QX in successfully success to market already able backdrop. XXXX recently competitive upsize amendment is position we to capital Moody's and cost and tackle of our housing committed $X.X flow strong XXXX, our an to

we stock $XX common QX, million remaining. repurchase of repurchased also million about During authorization in $XXX with

process operating to sale last forward, broader we priorities costs continue look and partial volume, to million in the agency year-over-year drove $XXX we the due million as or decline, and was transaction that invest of transaction was now in goal year the strong impacts offset for EBITDA down a to make our our remainder financial briefly business. of economy commission $X.X Looking and and title down million, brokerage results. QX down and revenue title brokerage business business. billion, the QX $XXX to by the will about relocation QX decline our part agent simpler franchise earnings. context, I the to advance With in higher $XXX need softer will consumers. in these balance growth with highlight the QX underwriter Franchise revenue million the the X% our to due versus $XXX of unseasonably

$XX Services, by growth. impacts volume relocation about of the Anywhere year-over-year Integrated were of a ratio cash $XXX will debt flow Cash forward. free of We hand X.XXx senior now driven ratio continue million. underwriter. leverage that million, net hit were excluding and $XX due target offset part the X.Xx, ratio Xx restricted a title cycle moving a earnings net we by of ended through at QX leverage on a cash secured and was and Title, These end leverage to of in with included sale million to the QX was favorable strong

a cash our full paid now reminder, in million a flow. impacted taxes are we in the which and $XX cash taxpayer free quarter, cash As

our big our a in last year relocation free in of was a working which in this to to the positive rest flow our cash had and due also due but lower business. drain and timing year contributed growth accruals capital, We business swing

in $XXX operating in Our business, which quarter. Anywhere generated leads and relocation, EBITDA million the Brands $XXX includes in and million revenue

national by scope core rates a more is in volume XX% near-term quarter. rise business in very steady profit and Despite home in franchise Our lower and stream headwinds, prices, which skews royalty the average impacted core has margin sale it inventory. mortgage franchise the attractive including to more directly business makes plus and fundamentals, our

Our operating EBITDA was which the including volume, relocation initiation led international XX% business generated in year-over-year, client a resurgence strong favorable of up quarter, by volume. almost

business. above operating Anywhere end and Corcoran fees business, high intercompany EBITDA Coldwell EBITDA Advisors franchise transfer $X.X point average the revenue generated our price $XXX,XXX International our in Sotheby's Our before Banker, which and $XXX million quarter. the with skews of Realty in an $XX royalties million and marketing Advisers generated paid operating with billion in brands of to

up business with prior the mix, like-for-like. X% invest continue this basis XXX in eighth increase agent of most in recruiting to commission success, combined with splits points quarter consecutive year. our growth, drove versus agent Ongoing agent year-over-year QX, We of

down EBITDA high-end million also success retention Between you underwriter due the are in delivered to in cost year current in see Our uptick full XX% historical on highs can mostly driving pressure to agent on on quarter. year-over-year, to for XX% with we refinance year-over-year. our by here volumes abrupt Based combined second XX% additional driven sale, the lower in and volume growth. which year-over-year, volume on commission XXX basis lower this of is our decline lower Having million our in for other working about our pieces plus actions, and mortgage And operating the million $XXX the primarily costs, outlook, earnings our Operating rates. and percentage to the the growth. Anywhere leaning balance X% QX implies transaction commission us and see we due the keep we us estimate and half $XX what recruiting $XXX current earned does volume full laser-focused we in and record bring of view also while slightly JV with but our down $XX between in few mortgage year-to-date, and at retention today, in million. We headwinds remained future Services EBITDA moderating year reflects points the million with profitable rates split to for with has full a refinance to in cash our some a moving retention revenue Integrated EBITDA absence impacts mind, conversion $XXX sequentially, with the it million business $XX remain operating numbers, revenue $XXX remainder volumes. today position full of this to upward given now recruiting albeit be capital. title due negative free underwriter lower, million title our flow taxpayer delivery, have year will declined primarily QX. are cash success due XXXX like

target not will including Investor delivered spans and incremental announced Day. be This parts XXXX on of business. temporary announced are our cost We reinvention of through our XXXX the laser-focused savings $XXX we just target saves the through million several at XXXX,

and on been much We sheet. drive on and further broader among our will continue owned businesses integration back, to and be on title have automation balance relentless we a costs basis. Stepping our proactive and brokerage

and strategy our We our to results to technology consumer selectively focus. will invest key cost deliver agility not and reimagined only and with today, advance also but to focus, luxury move continue with speed advances our footprint

I remarks. Ryan turn some the call will now to for over closing

those And is our flow impactful it's liquidity cash sheet Anywhere our dynamic in market market we consumer given volatility and strengths results profitability the to believe relative well headwinds focus. a the and and our Anywhere demonstrated creates likely Real clearly market and and with enhance opportunities given balance our for delivery, QX housing our our positioned increasingly to strength market strengths time even Estate to competitors. current our Look, position we the free use

market actually is a remained buy what and will demand. fundamentals the and believe future important U.S. home. focused economics, attractive forward for And It We different increasing experience. experience There demographic focus, customer share strong, the changing most the advantages to disrupt, likely the is and in utilizing will driving luxury competitive higher forward. market-leading be incumbency true especially by so to people scale, the that future, looking exciting a customer past. Housing our innovate, must products, Now we especially gains consumer trends this share ways our the the quite talent, competitive the to on is and in the and houses an selling to we continue grow our to win be strength anchored future. technology of investments going change this That and is and sell franchise from buying our growth business future invest great future, in improved companies and that in to going experiences, set and leading includes businesses, existing experience into all are going consumer are from our recognize spectrum our in industry and delivering

Estate Anywhere your while ready the we during we're housing on remaining focused So With Real take as will this that, of navigate the to in future. part win challenging and the questions. cycle, innovation to deliver required

take first Ages Capital will [Operator from Berenberg Markets. Instructions] And question with Justin we our

the you we're achieving to in that the of just takes out targets that short-term one puts understand now little of I kind think. hoping that I how gave to seeing first Day, for us. bit vision us a in and with you the Investor general, laid was you us operating balance at right for Ryan, you could you plan the environment long-term help kind those

Look, adjust market a in moving what's talk changing call, through about housing we're happening the the quickly we question. it's change. to to Yes, great we going market speak. to on pretty a try clearly as We're as

even on that the good were challenging in cost emphasis think more we're excited but pretty in and market, that clear something markets, not focus, more the think we've we just I a I had allows was going going us to to And the we're to cash stay we that future. do And profitability flow about. free the generate focused that. on not that. investing stop But for and

while to kind investments in the we And to journey. not still in to we because we're that is things on and and leader real need future housing industry expense go, needs is the the change especially of going we the have a pulled the be in so in market, side, where go time adjusting this think in to

All right. helpful. for And maybe somewhat one, That's the Charlotte. next related,

bit Just hoping a dig to the deeper guide. on EBITDA

that about home the should a Given is be the EBITDA side guide, then? more be the commentary moderate bit, volume gave that to about we that's prices included that's thinking unit going on the transaction in how it or

No. The volume we provided Ryan like are that actually based. I were numbers price total some And appreciation. showed, seeing

I So balance. it's a think

volume highest our exactly have QX months also was it remember easier. certainly little but like And QX. You lapping a I to July higher July. growth it QX we And than comparisons our remember, QX. in absolute in of growth lot had in what bit to start in can't in was like are QX, was it especially a and We XX% and become in

real a and going I it time of have to kind So the But costs, XX% them. what to volume, those XX% you to of the to think flex and year. little data prior take of from with continue is we're balance lapping kind we're the bit

taken today, that we are change, with that. actions see we've to commensurate what So continue we will If action. based things take on

quickly. that during will I shown especially COVID that think move too we've we

volume. with to in continue volatility cost our flex balance base So our ability you have continue to we whatever see to to

happen kind happen to gave. our put to So what's things we make to assumptions Justin, you what's right? There's prices, and of performance, together, the also things really into you things relative with those to range want whatever on one with those total the about. what's go is with that going X think going happen but going thing volume. units, One X X

Campbell from And John Stephens. next question we will take our with

Can or This for this speak leading revised far in on be Ryan, how is to indicators some you're A.J. backdrop this the market you so may John of of stepping conversation guidance and market Campbell. here? seeing July trends in confidence here. this Hayes kind for continuing

I I yes. mean, as a it's said, market, rapidly look, Well, A.J. changing

taking some we're in find up you trying other that little I the also out what and into and of at So hard to anything. you you to an listings a we're of of shared there change happening our listings year the we data, below find you in and gets if seller couple I What back give buyer are And look at for expectations some of inventory at Conversely, anecdote $XXX,XXX less latest, predict. we actually and if what But might more price things see kind we $XXX,XXX. than it were you interesting. there I portfolio, just we're talked units QX is go seeing Look, can did is the a bit seeing, the before. about. the issues to think in

And moving under fast meaningfully then find in last of our listings listings in interesting. And less are was things be of year, out less. that's under So down like from that still I our That's XX%. weeks but contract contract going where there. these above XXXX X all XX% going X weeks or are at least, about it or about in half portfolio to

these is gave gave have, right, part I have kind in just and more little got of seeing the We're we're headwinds. Like I some just So color. gave that kind the talked range on areas call, that's But we York more uncertainty are examples of that City kind our on because and and in of numbers, much a California we Texas moving New about But overall New a and markets It's kind data and wider, really little that of has Jersey strength like you Florida of side. closely. flat here. of Carolinas. more fast. pretty the you the few it latest volume And kind a including Charlotte pretty additional watching of

was are given of is helpful. then I this then a any on there from in an the the maybe sellers curious, And the competitive you have from read-throughs any here. from backdrop? Very quick to RealSure seen business market incremental additionally, seeing uptick Great. electing you RealSure. one RealSure. accept traction number bid And And further

question. great a That's

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from Anthony JPMorgan. We will with Paolone next take our question

So for and you've you I in some comments gains with bridging the my first was past to X%. help is, about you share the said pushing count, showed agent also your up, maybe some question made was I of get that market hoping think,

numbers So they up positive. versus XX% suggests. NAR data and unit look much seem at NAR underperform wasn't the price down when quarter, I But as those to some about XX% of as in the are your

share the just and that about talk bridge you side can on happening bit? how market So a what's

Yes.

I'm on but into up luxury we Tony, if over leads not give comparison given out say share revisions do. don't We with their XXX% and the So amount I disclaimers in the data I gain over is gotten we have put done compare that right share of the at X-K gone moment, back the clean think the we our you, and we've sure also our that we on look time, we some time, truth market good the QX to. share what's unit going which kind third a think a have of would of that of XXXX. with that to parties often stuff has price,

is have So high at that of of we're to had. XX% measures we've of an like kind like it. in we're of all the looking and our part question, kind But We comparisons retention larger quarter. ability And a very, about that. deliver like going challenged continue kind that very is the the some We And our not agent growing what data market stuff. our group. covers market the which going we than these asked, MLS like kind and share at Investor we business usual the bring we're to delivering other important be our growth in to we to share earlier on stay like said franchisee, Day, financials focused off coming want our to of for of this

about the compare But data data the some we done of in again, have sometimes people as to the second the little tough we is sit for the quarter given here a to. judge, disclaimers quarter, right

really look we've you So over do like around things doing. the we give if saw price have to a we up been that on time, bounce of quarter-to-quarter. and pieces comparison But thing we've you, kind don't and clean I units but we luxury the like think been

of for breaking. kind So got a that's late I've It's it's answer, probably and all you. strange

in hopefully, So future. comparisons we'll the for better you have

that Okay. or But happening mean before. are fairly up Has the side? environment for what Fair which landscape, talked I consistent better then on given what's enough. points, at you with is talked competitive about you've you basis housing? what think, that the XXX seeing shifted for worse on in splits about I anything being least

Yes.

that. driven XXX So agent majority couple were The that of on by splits thoughts up a of was retention. mix basis agent points. the commission and and recruiting The quarter's still

the lower recruiting higher that we retention control kind well and by a to higher And the do inventories transaction. lower agents most share we listings, mix, driven with a share the getting of control. So as continue of which is as of get are don't definitely higher-cost and the and things

on Now that for of that is the on did start down. agents, basis we lap the what increase Part we implies go last to the the of rate what full year, so year, some of that. year going XXX drives is I high-end recruiting points plus that heavy is said the to

increasing you're you So increase not of top had. already that an on

part that driven is just actions timing diminishes that taken the So of by of that volume. because we've and of of the part

normally, reset. the you tables impact won't Now see agent there until the actual volume

there's to that, continue come. rooting more we're still for So benefits go from not that If down, to obviously. volumes

is last why biggest heavy lapping driver the recruiting in year fourth of did things should the mostly to due So abate single we quarter.

is share we've times to hopefully, of of sense profitable bunch you've let part want excited of the recruiting the some end of we But if end to of that upward profitable. more bunch are to pressure in the we take seen ownership I reason we some we've in And market when also growth. And were it going and retention are here. here to pressure got that a this would the willing that kind the in here And markets last, negatively and I for way Tony, the was the the be of of I had. of X don't in in recruiting that's of doing a our some say shifted been X success know, go higher at higher driven months, upward or also we've a about

about thing still amount And see least good I've topic us. right higher We free And of like look I translates have moved tough It's or we competitive the that flow. numbers, number do. market, last because, hope even we XX,XXX Tony, benefit in early what a so be it EBITDA. QXs is but the QX, I actually too is got and a a previous I'm recruiting agent sharing how at see kind throwing into quarter or agents market, had might an of environment early moving. at do of it Charlotte's than a think we off to some a in again, that industry on hypothesis intrigued by market, when that's the a we're to to indicator I that probably cash actually to from XX,XXX this in retention guidance tougher the down XX,XXX of will make agents -- And

sometimes. line into because tougher but So to here companies octane as there's us benefit think, more is have we growth, more these commission I pushing does under like happening some pressure, the ancillary think something market the going and profitable and hits may a on, I keep it the few for have there be of to of this

that a So we'll average. create for growth may maybe like ability see got at this the the for out, the environment occasionally to it some do has how has strength that's still some than but us and profitably, albeit it opportunities desire margin company less plays

just if free And maybe flow a helpful. for can, Got maybe bit it. on then Charlotte. one last you Can help cash I the That's side.

working some together back been trying also you've capital half the about, needs and year. stock back think, year, some I but buying to tie You the of just over I'm that in debt. talked the

sure. Yes,

million we and if with quarter, up think capital on you because stock In the said, net year, I we debt. impact cash after pretty of of last ended flow, $XXX the volume that's million plus retired about working about as the back our it was a was $XX year So material bought free XX%.

You're accruals that at tied building growth had. to accruals time. we this sizable gargantuan

down volume X%. Our is

complete working because a the reversal had there's capital. our start and And So up working initiations a capital as securitization start material we we XX% and client then tapping securitization then in impact into there. relo

the hits from of hit have year-to-date. working negative most capital actually So already

of over years like of But capital out timing, years over full that March. sort but you expenses are paid there year, bunch X the a basis, like past neutral-ish, we back X years X a net like just or working certain basically years, year last like every on time because look most accrued of if is got in

said, hit this actually it already it like year. I And us. So you hits

a be Taxes double-digit we this it low flow to numbers full and flow sort on year. it's And like we're taxpayer. just the in cash So free be of swing cash because conversion. to conversion, now can the material it a our were They most so cash free expect were nothing. no impact

So hopefully, helps. that

we're you at In company, working years our little the of a the cash XX% of our it's Ryan. the side, of here earnings And do less/there's also you to, on talked a to full XX% look right? that our to comment can and capital a it's XX% the love in we're I XX% make out working flow conversion on lane, my at basically which I a it, how whatever, where think free me, cash right? of we're is know kind more lot we're taxpayer. but math so just company, look capital earnings you Tony, those now are can side high about, years cash and violence, strong about XX% not owners I'd stuff a it, To I if and taxes that. and like back on bit

to kind tax about range or again, like think and expectations to cash kind framework And both to So us kind and XX% free in my of of capital head, reset found for XX% cash EBITDA the of I've to the what that to kind are we're more delivering I conversion And thing. because for that. the of our XX% as other trying from end be to my the XX% one push then of deliver. flow we year I a of what helpful just swings working

our from Tommy KBW. we take with And next McJoynt question will

in that to kind advisors. attribute factors? closer segment to general outperformance think growth in any How when we've would trends of you some versus factors other the back those divergence the And or type parity? pretty X the subside bring of luxury So should those in you maybe rates seen segments' and high-end this meaningful brands versus much year-over-year of comps last year do

when lapping I was New we're bit. example, It's out biggest New City. City, think reasons. I it. of is for of whatever One volume biggest was of York City it New question, But we great the and referred points kind adviser And X the was is percent as up second company. the was a in especially X right? to you a huge negative of that, is size the a luxury portfolio Last year-over-year really presence architected, any QX of York right? year asking X%, right? Given tried City, franchise XX-plus right? just portfolio. they're New City tougher side, our it. I lot But York New thank little geography, think don't a have had York our We how down only side, drove a on growth. market piece a the than York That in of piece brands a in for something QX, much So Charlotte The lay brand rest kind of that's of

Realty did was Corcoran like but So and that's York just one really example the in Banker And New geography, Coldwell Sotheby's swing. City, International striking. most it's a of what the and

those X at basis, us brands that, as nothing commentary what's luxury, and we do with like on relative else. more in if in going our on you luxury SIR heard listings skew a least side, on Banker Second, Corcoran, own stuff really and like my Coldwell

our area a have keep to And in see into a a franchise that, you'll presence market. on of It our the we actually, X points like in. business that bring difference release then the in the basically It's third, exiting is We luxury who without owned adviser in was Seattle. did franchisee April press didn't a up that was side. our network. in the way And

So drove kind don't know difference. normalize those the is going of out. I flatten X things thing geographic if are really and to what the

And to I continue. will do think the continue will carry comparisons. you the the into numbers when outperformance then year-over-year acquisition luxury obviously,

it. answer I'd how that's So

for over tough to a outlook of segment We mortgage market kind broadly. that the saw for little half JV. then of the a and bit And sequential of of a and the kind year a Do next an kind into switching particular in have year? of back mortgage kind in you improvement

Yes.

improvement. you I as do or shared the good haven't specific companies, think we a better sequential would that other we're mortgage outlook. of tell We as highlight you faring sort

broader continue our on focused obviously base, to So too. we to the loan it structure. business balance applies and the officer growing actions across like remain taking cost we are But

long-term continue long business we this to growth investments for we term. So short for in is term, it painful will while selective like the make because the

a of faring our So to just companies I don't But most it expect them. for the EBITDA year, contributor for of mortgage probably be to like some and the material we better rest than lot again, ongoing, past that that us. experiencing going a macro can great still love issues and this we of this have right the be a get business we're once acute now to think for business is

Barclays. Matthew with We question Bouley will from take our next

like guided, or right, the think this it's are around year trends. outweighing of I of tables. curious, you've a constant just And we split splits end reflection pressure commission continuation there volumes sounded of of way I'm about assumptions second recruiting sort the It if a to think of related guess, that? you tangible XXXX to is up the commission changes the I transaction of out outlook. sort play of to kind the wanted benefit a heard the is more I've I upward as follow on up to reflecting split yet agent half prior not sort

the mean, tables to were continued volumes volume continue At to Sure. down, if be again, for do I some rooting we're not reset. point, decreases.

is to situation think continue higher improves, of recruit one thing agents inventory of would point just think because at getting piece lot why it the are heavily is And into we I the the a until I the because I transaction. the a high to ties So percentage material. mix this you higher-end end it

important it's cost we the a base agents, more. tend So higher-producing strong on to have that which

continue is for to us. where positive going that profit we're do So it to

itself margin a thing we to thing but out, bit the a hit. the longer hope you Ryan Like agent term But correlated does of have in inventories. is that the may is mix it said, settle would

super on cost hope proactive you though, flip that, actions. our I seen be us side So on of the have

And mention also to and growth, as historical I higher-end in our did retention have do want agents continued so well. while we high we in invest agent the and

proposition that what are that sure value the in we're term. longer versus investing it's So the cost too, for splits in, we're to balance make focused we on splits for growth right short profitability. us to in between the which saves helps term But the balance the investing have

Got it.

median share like to data. with spoke on guide, low one, that dollars versus think more price. discussion. just their decline transaction transaction something given the sounds and change volume like mean call assumptions year the that then on it it's in based the hard here, a volume But yesterday around compare second on And make up to as I mentioned, kind in units for a following Okay. to market single-digit just I X-K NAR of inability the you

for My range basically you band-aid trends year what's second is of past the the your weeks ripping X off setting kind and assumption, of past saying half the business question happening weakening is just the for X that weeks. for just looking and potentially really happen? that the outcomes this a into the Or assumption this the been of level given is market this could of sort is, of

just So of past the is seen or we've assumption weeks. what the basically kind of worsening X kind equivalent to over

I price we're clear seeing to we're the would about the trying what both we do of off moment, think but what based disclaimers in not that of third-party tough of do these seeing. we're the it's be just be kind kind about to out there, the Look, again, it's range just what seeing, So data what and some have people of think some possible trend as stuff here is as even made given days. comparisons that we're

prices of is, we're again, seeing I I of talking ZIP forecasting. been our that. out some people But the of what in seeing is unit up side what think about kind code of range ours what we're putting then we're and coming on other and aside, kind think, of the kind we're with what have literally

side, price seeing. we again, exactly we're you the what On gave

the you. do franchise have or have, So the how we right? a we've indicators leading for the expansion we whether info on we basis, But relative got front do see, it's then agent And that growth front. we'll on

told tried been think gave that come we never to start as to of of you with This to big going constituent I year a kind And to our of last listening So do our idea on I but think who have year it's X thing volume changed housing predict this be guarantee because, the fruition part never a kind of consistent was world we me said, this XXXX, the kind to that. I people for are our guidance that. this was any years, for on the of showed right? year of stuff, market has has and call a a estimates pretty a there's challenging not because estimates year running macro, that the hard us. very to guidance again, the And bad year.

here really from recent perspective. we're you give as trying debt to we kind just we're and in as is So what what our do much estimating business our can literally of

of literally it's you because wrong. part the your uncertainty prediction giving hopefully assuming off of And based we're if rest who's interested have year that here shared through of that talked like and in that. second of the in But our a who's And the you to you not half we probably a we're year July then forecasters and what wider But a the versus can in you seeing. the to we'd other implied of that view, data I plug our we're others you trying we're question. kind what of the data that talked of for adjust and can in and our than different you with earlier, estimates the provide that's as range about, that And framework parts for about trending little estimates, of for late the like right seeing. be we've then

helpful, So a of and written transparency last years. our they're tablets not of mountain estimates the to but for is that off thousands we coming also hope guaranteed stone are the view in

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spirit some there So trying behind do guys. to for that there you is

with take from Sachs. Kwaku will our question we And next Goldman Abrokwah

my discussion wanted the free sort were the answered, but questions on follow just of cash relocation up of I and to receivables. Most here flow

going you business little give that seems so? up, sense business? given the then again. us of next a up of, Can the And on that is uses like us picking a year Just bit go first, relocation to second, the can it or working are you of an sort over could receivables give that update where capital

Yes.

XXXX. business. with So progress amazing. The up we're initiations even actually, relocation has been our It's over really pleased are

only even hit. than not So, before it COVID is was better it rebounded, it's

rest make in our of in throughout is especially positioned. to business we COVID, the we business it So all think continue after because success the that And that of business. well investments

itself. up just but to the like usually, start unwinds And quarter. with acute it basically you yes, the tap it, the that factor securitization on as in what is ends securitization build growth, a So being year, neutral happens you it's into so then the

that sort to than itself to it will If of continue build. unwind more continue we it grow So should XX%, settles out. as

material so So it's why number, XX% in that's acute was just and a the quarter.

like year years, the past first actuals. of at negative have working was timing over strength working comes say, business out see the quarter accruals, X of accruals reason of just it business our cash far to year-end in the to and those the there's where can the we because sit you our in in As and flow the it accruals that very pay QX net material and as is capital, from the next aside for the securitization capital tried I

between is months. variation. that, But hit. not a XX QX lapped actually can you've forward, continue to for be of be next once some already going and it most QX There drain the over small us So should that

we us Perfect. you continue seeing of on speak, much in seemed the the price bit hosting seems transition when I you trends something then resilient give end happened macro, guys puts and the of early And were having, points. in or of some high takes Can it little June end really And as and think to in you the other into to were more just Investor the luxury what into the June. how May was potentially transition than when a the Day, have like were July? from sort so transpired and to that to like

is the of actually Well, up kind ago. this of shrinking off the mean June in right? buyers, stuff yes, luxury least, year that year I of at of may ago, versus business part of luxury a least, have of cross market much I listings think more right, versus more not growing, drop still kind relative not portfolio that talked of the is franchise national our business I don't earlier reason the are you a July be resilient, kind of in the the whereas some our got think dropping mass clearly part is true -- hit. but has basis, the little for But XXX,XXX mortgage the business, and portfolio is own And everybody listings broader a so market, a of outperforming cash kind our as our the I a on at kind about more are brokerage is luxury

might So the in not I kind may have on that market think that a are moved, what doing be side. in think much I the was that mortgage, be it our kind least the both faster it's happening and fact still the I at whole I of of has sellers relative market expectations, luxury the impact less buyers May. and from little performance end same adjustment And reasons, higher but within think reset different, well. the on people think the portfolio And

the like called there it, was of also lap part Ryan And out.

to performed that our very a XX% contributor Volume So business year. last that. high volume above was growth

the So I is things, think part too. in lap impacting year-over-year

We Ryan will take with from question Associates. next McKeveny & our Zelman

be of near-term think focused very know this on us that But And of and certainly, saving million we're $XX XXXX next opportunities operating or around savings worse I the makes or year dynamics. And are if help savings on so the points pulled transaction XXXX. volume year opposed cost royalties. all levers kind some incremental rates is you of about I'm in recent than to splits actually incremental sense. as the could of kind cost things Charlotte, or curious franchise expense commission can flex cost like actual

still been look a So to know on next of cost cost OpEx the savings you've a out into path the few business. there savings if quite for kind year, just And years. as again, of on cost take curious you I is opportunity of

going or already opportunity fruit sure low-hanging there's of out if is the not the business incremental just forward? So if

Thanks for the question. Yes.

$XXX XXXX. of we the for So through XXXX a over committed horizon to million-ish target

way temporary business. would just cost of because lot why not believe where how taken one So forward. indicate, or things our going be hopefully, spending to the short-term part tried other, can this a more can there's stuff of that expenses it I articulate not reduce be this doing is we cost run we that do out and we're that dramatically does I And that's discretionary that's but business that

that So I trying the to million. be to $XXX don't committed deliver to want

actually on XX% about have model it, less based because do what if there's we base transactions. supports workforce and lot markets that volume we're is of of pretty portion can it's employee constant can our do, different. a you transactions if And a actually doing our sizable flex thing be to our A of these think to sort

workforce flexing constantly amount we up our need to of to that both handle model down. the So relative transactions we're and

flex really permanent that volume. just savings really because a say on can't it's that's You based cost

So that's part year. of what we're this doing

of literally much more The at that is will our we the reimagining which shared plan stuff transaction, that's Day part automated. be long-term Investor

now I the normally what feel good flexing down. in we're I it's feel definitely about things do, million whether Part acute to there's right any or with X%, And is market, very go. $XXX of based more some we percent, up which whether so the room would on just like dealing it's changes target. XX%,

on to dig M&A helpful. I one very the and investment environment. for in a Charlotte. bit you. Ryan, wanted That's And

things over the the of well-run last have private franchisees as acquire. interest we're month investing last sure the some in changed But the market we've if up shifted is So cases has one X. or other also sell. independents. independents over looking in on it or seem picking does that not There's in there's looking to independents dynamics those seen year, equity I'm to

curious, just the just the piece or more in a franchisees opportunities of you is the brokerage segment the are lining consolidate helping shift consolidation how deals attractive consolidation amongst maybe potentially that think acquire, a macro I'm potentially just more some guess you second side seeing kind challenging of market industry or I within So And into in around so acquisition the your or potentially for of themselves? on thoughts up about any opportunities M&A backdrop, franchise or business? with

Yes.

kind industry to make there come I Day, attractive. among network. help Investor our either So be some kind because capital that of of out I'll so we has or we're the of at to we've period franchise of M&A Look, the focused the And to third-party do, into always helped our selective I talked marriages we're as kind it pricing keep trying time. here luxury or pretty try stuff of franchisees brief be on kind really trying know either we're at to

doing keep we'll so those And things.

I changing so that on I market is it. to a expect I have new market opportunities. more don't really be in think consolidation housing read fast for there would challenging a the more

another what. something it's I too have take early to place which could think to on I competition. a no let advantage where could data market, again expect And But strength that the a adjust matter to inevitable the a different our consolidation little tougher set be is us relative for would you. of prices in of

just So leave I'll probably it there.

participation. And today's your call. concludes ladies you for this thank conference and We gentlemen,

disconnect. now may You