![](/cdn/assets/images/search/clock.png)
We could not find any results for:
Make sure your spelling is correct or try broadening your search.
Share Name | Share Symbol | Market | Type |
---|---|---|---|
Newmark Group Inc | NASDAQ:NMRK | NASDAQ | Common Stock |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
0.39 | 3.47% | 11.62 | 11.64 | 11.90 | 11.705 | 11.29 | 11.42 | 1,263,185 | 22:02:23 |
|
☒
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
☐
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
|
|
Delaware
|
|
81-4467492
|
(State or other Jurisdiction of
Incorporation or Organization)
|
|
(I.R.S. Employer
Identification Number)
|
Title of Each Class
|
|
Trading Symbol(s)
|
|
Name of Each Exchange on Which Registered
|
Class A Common Stock, $0.01 par value
|
|
NMRK
|
|
The NASDAQ Stock Market LLC
|
|
Large accelerated filer
|
☒
|
Accelerated filer
|
☐
|
Non-accelerated filer
|
☐
|
Smaller reporting company
|
☐
|
Emerging growth company
|
☐
|
|
|
Class
|
|
Outstanding at May 7, 2020
|
Class A Common Stock, par value $0.01 per share
|
|
156,940,608 shares
|
Class B Common Stock, par value $0.01 per share
|
|
21,285,533 shares
|
|
|
|
Page
|
PART I - FINANCIAL INFORMATION
|
||
|
|
|
ITEM 1.
|
FINANCIAL STATEMENTS (unaudited)
|
|
|
Condensed Consolidated Balance Sheets
|
|
|
Condensed Consolidated Statements of Operations
|
|
|
Condensed Consolidated Statements of Comprehensive Income
|
|
|
Condensed Consolidated Statements of Changes in Equity
|
|
|
Condensed Consolidated Statements of Cash Flows
|
|
|
Notes to Condensed Consolidated Financial Statements
|
|
ITEM 2.
|
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
|
|
ITEM 3.
|
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
|
|
ITEM 4.
|
CONTROLS AND PROCEDURES
|
|
|
|
|
PART II - OTHER INFORMATION
|
||
|
|
|
ITEM 1.
|
LEGAL PROCEEDINGS
|
|
ITEM 1A.
|
RISK FACTORS
|
|
ITEM 2.
|
UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
|
|
ITEM 3.
|
DEFAULTS UPON SENIOR SECURITIES
|
|
ITEM 4.
|
||
ITEM 5.
|
OTHER INFORMATION
|
|
ITEM 6.
|
||
|
|
|
•
|
the impact of the coronavirus (COVID-19) pandemic on our operations, including the continued ability of our employees, clients and third-party service providers to perform their functions at normal levels and our ability to continue providing on-site commercial property management services;
|
•
|
macroeconomic and other challenges and uncertainties resulting from the COVID-19 pandemic, such as the extent and duration of the impact on public health, the economy, the commercial real estate services industry and the global financial markets, and consumer and corporate clients and customers, as well as the impact of governmental responses thereto, including the effect on demand for commercial real estate, levels of new lease activity and renewals, frequency of loan defaults and forbearance, fluctuations in the mortgage-backed securities market and increases in transition expenses to reposition aspects of our business to address the changing business environment;
|
•
|
market conditions, transaction volumes, possible disruptions in transactions, potential deterioration of equity and debt capital markets for commercial real estate and related services, impact of significant changes in interest rates and our ability to access the capital markets as needed or on reasonable terms and conditions;
|
•
|
pricing, commissions and fees, and market position with respect to any of our products and services and those of our competitors;
|
•
|
the effect of industry concentration and reorganization, reduction of customers and consolidation;
|
•
|
liquidity, regulatory requirements and the impact of credit market events , including the impact of COVID-19 and actions taken by governments and businesses in responses thereto on the credit markets and interest rates;
|
•
|
our relationship and transactions with Cantor Fitzgerald, L.P. (“Cantor”) and its affiliates, Newmark’s structure, including Newmark Holdings, L.P. (“Newmark Holdings”), which is owned by Newmark, Cantor, Newmark’s employee partners and other partners, and our operating partnership, which is owned jointly by us and Newmark Holdings (which we refer to as “Newmark OpCo” ) any related transactions, conflicts of interest, or litigation, any loans to or from Newmark or Cantor, Newmark Holdings or Newmark OpCo, including the balances and interest rates thereof from time to time and any convertible or equity features of any such loans ,competition for and retention of brokers and other managers and key employees;
|
•
|
the impact on our stock price on the reduction of our dividend and potential future changes in our dividend policy and in Newmark Holdings distributions to partners and the related impact of such reductions, as well as the effect of layoffs, salary cuts, and expected lower commissions or bonuses on the repayment of partner loans;
|
•
|
market volatility as a result of the effects of COVID-19, which may not be sustainable or predictable in future periods;
|
•
|
our ability to grow in other geographic regions and to manage our recent overseas growth and the impact of the COVID-19 pandemic on these regions and transactions;
|
•
|
the impact of, and limitations on our ability to enter into certain transactions in order to preserve the tax-free treatment of, the November 2018 pro-rata distribution (the “Spin-Off”) by BGC Partners, Inc. (“BGC Partners” or “BGC”) to BGC stockholders of all of the shares of our common stock owned by BGC as of immediately prior to the effective time of the Spin-Off;
|
•
|
our ability to maintain or develop relationships with independently owned offices or affiliated businesses or partners in our business;
|
•
|
our ability to manage and to continue to integrate Berkeley Point Financial LLC (“Berkeley Point” or “BPF” and which operates under the name “Newmark Knight Frank” or “NKF”) which was transferred to us pursuant to the Separation and Distribution Agreement (as defined below);
|
•
|
the impact of the Separation, the Spin-Off and related transactions or any restructuring or similar transactions on our business and financial results in current or future periods, including with respect to any assumed liabilities or
|
•
|
the integration of acquired businesses with our business;
|
•
|
the rebranding of our current businesses or risks related to any potential dispositions of all or any portion of our existing or acquired businesses;
|
•
|
risks related to changes in our relationships with the Government Sponsored Enterprises (“GSEs”) and Housing and Urban Development (“HUD”), including the impact of COVID-19 and related changes in the credit markets, changes in prevailing interest rates and the risk of loss in connection with loan defaults;
|
•
|
risks related to changes in the future of the GSEs, including changes in the terms of applicable conservatorships and changes in their capabilities;
|
•
|
economic or geopolitical conditions or uncertainties, the actions of governments or central banks, including the impact of COVID-19 on the global markets, and related government stimulus packages, government ”shelter-in-place” orders and other restrictions on business and commercial activity and timing of reopening of local, national, and world economies, uncertainty regarding the nature, timing and consequences of the United Kingdom (“U.K.”)’s exit from the European Union (“EU”) following the withdrawal process, proposed transition period and related rulings, including potential reduction in investment in the U.K., and the pursuit of trade, border control or other related policies by the U.S. and/or other countries (including U.S. - China trade relations), political and labor unrest in France, Hong Kong, China and other jurisdictions, conflict in the Middle East, the impact of U.S. government shutdowns, impasses and elections, the impact of terrorist acts, acts of war or other violence or political unrest, as well as natural disasters or weather-related or similar events, including hurricanes as well as power failures, communication and transportation disruptions, and other interruptions of utilities or other essential services, and the impact of pandemics and other international health incidents, including COVID-19;
|
•
|
the effect on our business, clients, the markets in which we operate, and the economy in general of recent changes in the U.S. and foreign tax and other laws, including changes in tax rates, repatriation rules, and deductibility of interest, potential policy and regulatory changes in Mexico, sequestrations, uncertainties regarding the debt ceiling and the federal budget, and other potential political policies;
|
•
|
the effect on our business of changes in interest rates, changes in benchmarks, including the phase out of the London Interbank Offering Rate (“LIBOR”), the level of worldwide governmental debt issuances, austerity programs, government stimulus packages related to COVID-19, increases or decreases in deficits and the impact of increased government tax rates, and other changes to monetary policy, and potential political impasses or regulatory requirements, including increased capital requirements for banks and other institutions or changes in legislation, regulations and priorities;
|
•
|
extensive regulation of our business and clients, changes in regulations relating to commercial real estate and other industries, and risks relating to compliance matters, including regulatory examinations, inspections, investigations and enforcement actions, and any resulting costs, increased financial and capital requirements, enhanced oversight, remediation, fines, penalties, sanctions, and changes to or restrictions or limitations on specific activities, operations, compensatory arrangements, and growth opportunities, including acquisitions, hiring, and new businesses, products, or services, as well as risks related to our taking actions to ensure that we and Newmark Holdings are not deemed investment companies under the Investment Company Act of 1940;
|
•
|
factors related to specific transactions or series of transactions as well as counterparty failure;
|
•
|
costs and expenses of developing, maintaining and protecting our intellectual property, as well as employment, regulatory, and other litigation, proceedings and their related costs, including related to acquisitions and other matters, including judgments, fines, or settlements paid, reputational risk, and the impact thereof on our financial results and cash flow in any given period;
|
•
|
our ability to maintain continued access to credit and availability of financing necessary to support our ongoing business needs, including to refinance indebtedness, and the risks associated with the resulting leverage, as well as fluctuations in interest rates;
|
•
|
certain other financial risks, including the possibility of future losses, indemnification obligations, assumed liabilities, reduced cash flows from operations, increased leverage, reduced availability under our Credit Facility (as defined below) resulting from recent borrowings, and the need for short or long-term borrowings, including from Cantor, the ability of Newmark to refinance its indebtedness, including in the credit markets weakened by the impact of COVID-19 and changes to interest rates and market liquidity or our access to other sources of cash relating to acquisitions, dispositions, or other matters, potential liquidity and other risks relating to our ability to maintain continued access to credit and availability of financing necessary to support ongoing business needs on terms acceptable to us, if at all, and risks associated with the resulting leverage, including potentially causing a reduction in credit ratings and the associated outlooks and increased borrowing costs as well as interest rate and foreign currency
|
•
|
risks associated with the temporary or longer-term investment of our available cash, including in Newmark OpCo, defaults or impairments on the Company’s investments, joint venture interests, stock loans or cash management vehicles and collectability of loan balances owed to us by partners, employees, Newmark OpCo or others;
|
•
|
our ability to enter new markets or develop new products or services and to induce clients to use these products or services and to secure and maintain market share, and the impact of COVID-19 generally and on the commercial real estate services business in particular;
|
•
|
our ability to enter into marketing and strategic alliances, business combinations, restructuring, rebranding or other transactions, including acquisitions, dispositions, reorganizations, partnering opportunities and joint ventures, the anticipated benefits of any such transactions, relationships or growth and the future impact of any such transactions, relationships or growth on other businesses and financial results for current or future periods, the integration of any completed acquisitions and the use of proceeds of any completed dispositions, the impact of amendments and/or terminations of any strategic arrangements, and the value of any hedging entered into in connection with consideration received or to be received in connection with such dispositions and any transfers thereof;
|
•
|
our estimates or determinations of potential value with respect to various assets or portions of the Company’s business, including with respect to the accuracy of the assumptions or the valuation models or multiples used;
|
•
|
the impact of layoffs and furloughs on our business, including on our ability to hire and retain personnel, including brokers, salespeople, managers, and other professionals;
|
•
|
our ability to effectively manage any growth that may be achieved, including outside of the U.S., while ensuring compliance with all applicable financial reporting, internal control, legal compliance, and regulatory requirements;
|
•
|
our ability to identify and remediate any material weaknesses in internal controls that could affect the ability to properly maintain books and records, prepare financial statements and reports in a timely manner, control policies, practices and procedures, operations and assets, assess and manage the Company’s operational, regulatory and financial risks, and integrate acquired businesses and brokers, salespeople, managers and other professionals;
|
•
|
the impact of unexpected market moves and similar events;
|
•
|
information technology risks, including capacity constraints, failures, or disruptions in our systems or those of clients, counterparties, or other parties with which we interact, increased demands on such systems and on the telecommunications infrastructure from remote working during the COVID-19 pandemic, including cyber-security risks and incidents, compliance with regulations requiring data minimization and protection and preservation of records of access and transfers of data, privacy risk and exposure to potential liability and regulatory focus;
|
•
|
the impact of our recent significant reductions to our dividends and distributions and the timing and amounts of any future dividend or distributions, including our ability to meet expectations with respect to payment of dividends and repurchases of common stock or purchases of Newmark Holdings limited partnership interests or other equity interests in subsidiaries, including Newmark OpCo, including from Cantor or our executive officers, other employees, partners and others and the effect on the market for and trading price of our Class A common stock as a result of any such transactions;
|
•
|
the effectiveness of our governance, risks management, and oversight procedures and the impact of any potential transactions or relationships with related parties;
|
•
|
the impact of our environmental, social and governance (“ESG”) or “sustainability” ratings on the decisions by clients, investors, potential clients and other parties with respect to our business, investments in us or the market for and trading price of Newmark Class A common stock or other matters;
|
•
|
the fact that the prices at which shares of our Class A common stock are or may be sold in offerings or other transactions may vary significantly, and purchasers of shares in such offerings or other transactions, as well as existing stockholders, may suffer significant dilution if the price they paid for their shares is higher than the price paid by other purchasers in such offerings or transactions;
|
•
|
the effect on the market for and trading price of our Class A common stock due to COVID-19 and other market factors, as well as on various offerings and other transactions, including offerings of Class A common stock and convertible or exchangeable debt or other securities, repurchases of shares of Class A common stock and purchases or redemptions of Newmark Holdings limited partnership interests or other equity interests in us or its subsidiaries, any exchanges by Cantor of shares of Class A common stock for shares of Class B common stock, any exchanges or redemptions of limited partnership units and issuances of shares of Class A common stock in connection therewith, including in corporate or partnership restructurings, payment of dividends on Class A common stock and distributions on limited partnership interests of Newmark Holdings and Newmark OpCo, convertible arbitrage, hedging, and other transactions engaged in by us or holders of outstanding shares, debt or other securities, share sales and stock pledge, stock loans, and other financing transactions by holders of shares or units (including by Cantor
|
•
|
the effect of a potential conversion of BGC’s partnership into a corporation on Newmark, including but not limited to, impacts on Newmark’s employees holding BGC Holdings units and on our financial statements; and
|
•
|
other factors, including those that are discussed under “Risk Factors,” to the extent applicable.
|
|
March 31,
2020 |
|
December 31,
2019 |
||||
Assets:
|
|
|
|
|
|
||
Current assets:
|
|
|
|
|
|
||
Cash and cash equivalents
|
$
|
291,544
|
|
|
$
|
163,564
|
|
Restricted cash
|
60,045
|
|
|
58,308
|
|
||
Marketable securities
|
—
|
|
|
36,795
|
|
||
Loans held for sale, at fair value
|
739,383
|
|
|
215,290
|
|
||
Receivables, net
|
439,080
|
|
|
508,379
|
|
||
Other current assets (see Note 19)
|
131,651
|
|
|
91,194
|
|
||
Total current assets
|
1,661,703
|
|
|
1,073,530
|
|
||
Goodwill
|
559,214
|
|
|
557,914
|
|
||
Mortgage servicing rights, net
|
412,813
|
|
|
413,644
|
|
||
Loans, forgivable loans and other receivables from employees and partners, net
|
490,754
|
|
|
403,710
|
|
||
Right-of-use assets
|
195,510
|
|
|
201,661
|
|
||
Fixed assets, net
|
103,061
|
|
|
98,016
|
|
||
Other intangible assets, net
|
50,080
|
|
|
45,226
|
|
||
Other assets (see Note 19)
|
413,102
|
|
|
407,898
|
|
||
Total assets
|
$
|
3,886,237
|
|
|
$
|
3,201,599
|
|
Liabilities, Redeemable Partnership Interests, and Equity:
|
|
|
|
||||
Current liabilities:
|
|
|
|
|
|||
Warehouse facilities collateralized by U.S. Government Sponsored Enterprises
|
$
|
703,321
|
|
|
$
|
209,648
|
|
Accrued compensation
|
257,892
|
|
|
343,845
|
|
||
Accounts payable, accrued expenses and other liabilities (see Note 29)
|
399,847
|
|
|
417,069
|
|
||
Securities loaned
|
—
|
|
|
36,735
|
|
||
Payables to related parties
|
14,643
|
|
|
38,090
|
|
||
Total current liabilities
|
1,375,703
|
|
|
1,045,387
|
|
||
Long-term debt
|
952,756
|
|
|
589,294
|
|
||
Right-of-use liabilities
|
221,265
|
|
|
227,942
|
|
||
Other long-term liabilities (see Note 29)
|
394,201
|
|
|
376,834
|
|
||
Total liabilities
|
2,943,925
|
|
|
2,239,457
|
|
||
Commitments and contingencies (see Note 31)
|
|
|
|
|
|
||
Redeemable partnership interests
|
21,379
|
|
|
21,517
|
|
||
Equity:
|
|
|
|
||||
Class A common stock, par value of $0.01 per share: 1,000,000,000 shares authorized; 161,269,748 and
160,833,463 shares issued at March 31, 2020 and December 31, 2019, respectively, and 156,701,746 and 156,265,461 shares outstanding at March 31, 2020 and December 31, 2019, respectively |
1,612
|
|
|
1,608
|
|
||
Class B common stock, par value of $0.01 per share: 500,000,000 shares authorized; 21,285,533 shares issued and outstanding at March 31, 2020 and December 31, 2019
|
212
|
|
|
212
|
|
||
Additional paid-in capital
|
324,817
|
|
|
318,165
|
|
||
Retained earnings
|
282,053
|
|
|
313,112
|
|
||
Contingent Class A common stock
|
1,050
|
|
|
1,461
|
|
||
Treasury stock at cost: 4,568,002 shares of Class A common stock at March 31, 2020 and December 31, 2019
|
(34,894
|
)
|
|
(34,894
|
)
|
||
Accumulated other comprehensive income (loss)
|
(1,277
|
)
|
|
—
|
|
||
Total stockholders’ equity
|
573,573
|
|
|
599,664
|
|
||
Noncontrolling interests
|
347,360
|
|
|
340,961
|
|
||
Total equity
|
920,933
|
|
|
940,625
|
|
||
Total liabilities, redeemable partnership interests, and equity
|
$
|
3,886,237
|
|
|
$
|
3,201,599
|
|
|
Three Months Ended March 31,
|
||||||
|
2020
|
|
2019
|
||||
Revenues:
|
|
|
|
|
|
||
Commissions
|
$
|
268,362
|
|
|
$
|
275,268
|
|
Gains from mortgage banking activities/originations, net
|
50,422
|
|
|
31,346
|
|
||
Management services, servicing fees and other
|
165,146
|
|
|
141,042
|
|
||
Total revenues
|
483,930
|
|
|
447,656
|
|
||
Expenses:
|
|
|
|
||||
Compensation and employee benefits
|
300,257
|
|
|
263,353
|
|
||
Equity-based compensation and allocations of net income to limited partnership units and FPUs
|
12,914
|
|
|
13,871
|
|
||
Total compensation and employee benefits
|
313,171
|
|
|
277,224
|
|
||
Operating, administrative and other
|
92,281
|
|
|
87,893
|
|
||
Fees to related parties
|
5,812
|
|
|
6,725
|
|
||
Depreciation and amortization
|
46,039
|
|
|
28,304
|
|
||
Total operating expenses
|
457,303
|
|
|
400,146
|
|
||
Other income (loss), net
|
1,438
|
|
|
(9,718
|
)
|
||
Income from operations
|
28,065
|
|
|
37,792
|
|
||
Interest (expense) income, net
|
(9,030
|
)
|
|
(7,699
|
)
|
||
Income before income taxes and noncontrolling interests
|
19,035
|
|
|
30,093
|
|
||
Provision for income taxes
|
4,797
|
|
|
6,687
|
|
||
Consolidated net income
|
14,238
|
|
|
23,406
|
|
||
Less: Net income attributable to noncontrolling interests
|
6,056
|
|
|
6,502
|
|
||
Net income available to common stockholders
|
$
|
8,182
|
|
|
$
|
16,904
|
|
Per share data:
|
|
|
|
||||
Basic earnings per share
|
|
|
|
||||
Net income available to common stockholders (1)
|
$
|
5,737
|
|
|
$
|
13,680
|
|
Basic earnings per share
|
$
|
0.03
|
|
|
$
|
0.08
|
|
Basic weighted-average shares of common stock outstanding
|
177,545
|
|
|
178,611
|
|
||
Fully diluted earnings per share
|
|
|
|
||||
Net income for fully diluted shares
|
$
|
8,933
|
|
|
$
|
21,968
|
|
Fully diluted earnings per share
|
$
|
0.03
|
|
|
$
|
0.08
|
|
Fully diluted weighted-average shares of common stock outstanding
|
263,646
|
|
|
269,057
|
|
(1)
|
Includes a reduction for dividends on preferred stock or units in the amount of $2.4 million and $3.2 million for the three months ended March 31, 2020 and 2019, respectively.
|
|
Three Months Ended March 31,
|
||||||
|
2020
|
|
2019
|
||||
Consolidated net income
|
$
|
14,238
|
|
|
$
|
23,406
|
|
Foreign currency translation adjustments
|
(1,277
|
)
|
|
—
|
|
||
Comprehensive income, net of tax
|
12,961
|
|
|
23,406
|
|
||
Less: Comprehensive income attributable to noncontrolling interests, net of tax
|
6,056
|
|
|
6,502
|
|
||
Comprehensive income available to common stockholders
|
$
|
6,905
|
|
|
$
|
16,904
|
|
|
Class A
Common
Stock
|
|
Class B
Common
Stock
|
|
Additional
Paid-in
Capital
|
|
Contingent
Class A
Common Stock
|
|
Treasury
Stock
|
|
Retained
Earnings
|
|
Accumulated
Other Comprehensive Income (Loss) |
|
Noncontrolling
Interests
|
|
Total
|
||||||||||||||||||
Balance, January 1, 2019
|
$
|
1,570
|
|
|
$
|
212
|
|
|
$
|
285,071
|
|
|
$
|
3,250
|
|
|
$
|
(486
|
)
|
|
$
|
277,952
|
|
|
$
|
—
|
|
|
$
|
489,230
|
|
|
$
|
1,056,799
|
|
Consolidated net income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
16,904
|
|
|
—
|
|
|
6,502
|
|
|
23,406
|
|
|||||||||
Dividends to common stockholders
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(16,043
|
)
|
|
—
|
|
|
—
|
|
|
(16,043
|
)
|
|||||||||
Preferred dividends on exchangeable preferred
partnership units
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(3,224
|
)
|
|
—
|
|
|
3,224
|
|
|
—
|
|
|||||||||
Earnings distributions to limited partnership interests
and other noncontrolling interests
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(27,280
|
)
|
|
(27,280
|
)
|
|||||||||
Grant of exchangeability, redemption and issuance of
Class A common stock, 498,129 shares
|
4
|
|
|
—
|
|
|
(572
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(14,962
|
)
|
|
(15,530
|
)
|
|||||||||
Issuance and redemption of limited partnership units
including contingent units
|
—
|
|
|
—
|
|
|
109
|
|
|
(109
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||||
Restricted stock units compensation
|
—
|
|
|
—
|
|
|
271
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
271
|
|
|||||||||
Other
|
—
|
|
|
—
|
|
|
(825
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(825
|
)
|
|||||||||
Balance, March 31, 2019
|
$
|
1,574
|
|
|
$
|
212
|
|
|
$
|
284,054
|
|
|
$
|
3,141
|
|
|
$
|
(486
|
)
|
|
$
|
275,589
|
|
|
$
|
—
|
|
|
$
|
456,714
|
|
|
$
|
1,020,798
|
|
|
Class A
Common
Stock
|
|
Class B
Common
Stock
|
|
Additional
Paid-in
Capital
|
|
Contingent
Class A
Common Stock
|
|
Treasury
Stock
|
|
Retained
Earnings
|
|
Accumulated
Other
Comprehensive
Income (Loss)
|
|
Noncontrolling
Interests
|
|
Total
|
||||||||||||||||||
Balance, January 1, 2020
|
$
|
1,608
|
|
|
$
|
212
|
|
|
$
|
318,165
|
|
|
$
|
1,461
|
|
|
$
|
(34,894
|
)
|
|
$
|
313,112
|
|
|
$
|
—
|
|
|
$
|
340,961
|
|
|
$
|
940,625
|
|
Consolidated net income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
8,182
|
|
|
—
|
|
|
6,056
|
|
|
14,238
|
|
|||||||||
Other comprehensive income (loss), net of tax
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,277
|
)
|
|
—
|
|
|
(1,277
|
)
|
|||||||||
Cumulative effect of the credit loss standard adoption
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(19,023
|
)
|
|
—
|
|
|
—
|
|
|
(19,023
|
)
|
|||||||||
Dividends to common stockholders
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(17,773
|
)
|
|
—
|
|
|
—
|
|
|
(17,773
|
)
|
|||||||||
Preferred dividends on exchangeable preferred
partnership units
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,445
|
)
|
|
—
|
|
|
2,445
|
|
|
—
|
|
|||||||||
Earnings distributions to limited partnership interests
and other noncontrolling interests
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(952
|
)
|
|
(952
|
)
|
|||||||||
Grant of exchangeability, redemption and issuance of
Class A common stock, 436,285 shares
|
4
|
|
|
—
|
|
|
4,423
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,438
|
)
|
|
1,989
|
|
|||||||||
Issuance and redemption of limited partnership units
including contingent units
|
—
|
|
|
—
|
|
|
425
|
|
|
(411
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
893
|
|
|
907
|
|
|||||||||
Restricted stock units compensation
|
—
|
|
|
—
|
|
|
1,804
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
395
|
|
|
2,199
|
|
|||||||||
Balance, March 31, 2020
|
$
|
1,612
|
|
|
$
|
212
|
|
|
$
|
324,817
|
|
|
$
|
1,050
|
|
|
$
|
(34,894
|
)
|
|
$
|
282,053
|
|
|
$
|
(1,277
|
)
|
|
$
|
347,360
|
|
|
$
|
920,933
|
|
|
Three Months Ended March 31,
|
||||||
|
2020
|
|
2019
|
||||
Dividends declared per share of common stock
|
$
|
0.10
|
|
|
$
|
0.10
|
|
Dividends declared and paid per share of common stock
|
$
|
0.10
|
|
|
$
|
0.09
|
|
|
Three Months Ended March 31,
|
||||||
|
2020
|
|
2019
|
||||
CASH FLOWS FROM OPERATING ACTIVITIES:
|
|
|
|
|
|
||
Consolidated net income
|
$
|
14,238
|
|
|
$
|
23,406
|
|
Adjustments to reconcile net income to net cash (used in) provide by operating activities:
|
|
|
|
||||
Gain on originated mortgage servicing rights
|
(38,967
|
)
|
|
(17,254
|
)
|
||
Depreciation and amortization
|
46,039
|
|
|
28,304
|
|
||
Provision for credit losses on the financial guarantee liability
|
14,480
|
|
|
—
|
|
||
Provision for doubtful accounts
|
2,754
|
|
|
956
|
|
||
Equity-based compensation and allocation of net income to limited partnership units and FPUs
|
12,914
|
|
|
13,871
|
|
||
Employee loan amortization
|
14,468
|
|
|
7,437
|
|
||
Non-cash changes in acquisition related earnouts
|
(12,813
|
)
|
|
193
|
|
||
Loss on non-marketable investments
|
16,837
|
|
|
—
|
|
||
Unrealized (gains) loss on loans held for sale
|
(36,061
|
)
|
|
(13,276
|
)
|
||
Realized (gains) loss on marketable securities
|
2,204
|
|
|
51
|
|
||
Unrealized (gains) loss on marketable securities
|
—
|
|
|
(3,960
|
)
|
||
Change in valuation of derivative asset
|
(21,173
|
)
|
|
13,329
|
|
||
Loan originations—loans held for sale
|
(2,545,715
|
)
|
|
(1,554,443
|
)
|
||
Loan sales—loans held for sale
|
2,057,684
|
|
|
1,685,561
|
|
||
Other
|
2,971
|
|
|
1,167
|
|
||
Consolidated net income (loss), adjusted for non-cash and non-operating items
|
(470,140
|
)
|
|
185,342
|
|
||
Changes in operating assets and liabilities:
|
|
|
|
||||
Receivables, net
|
62,000
|
|
|
4,709
|
|
||
Loans, forgivable loans and other receivables from employees and partners
|
(105,274
|
)
|
|
(39,995
|
)
|
||
Other assets
|
(28,253
|
)
|
|
(18,602
|
)
|
||
Accrued compensation
|
(89,742
|
)
|
|
(62,051
|
)
|
||
Accounts payable, accrued expenses and other liabilities
|
(6,730
|
)
|
|
(29,970
|
)
|
||
Payables to related parties
|
(14,262
|
)
|
|
—
|
|
||
Net cash (used in) provide by operating activities
|
(652,401
|
)
|
|
39,433
|
|
||
CASH FLOWS FROM INVESTING ACTIVITIES:
|
|
|
|
||||
Payments for acquisitions, net of cash acquired
|
(5,850
|
)
|
|
—
|
|
||
Proceeds from the sale of marketable securities
|
34,591
|
|
|
9,106
|
|
||
Purchases of fixed assets
|
(9,849
|
)
|
|
(5,936
|
)
|
||
Purchase of mortgage servicing rights
|
(92
|
)
|
|
(298
|
)
|
||
Net cash (used in) provided by investing activities
|
18,800
|
|
|
2,872
|
|
||
CASH FLOWS FROM FINANCING ACTIVITIES:
|
|
|
|
||||
Proceeds from warehouse facilities
|
2,545,715
|
|
|
1,554,443
|
|
||
Principal payments on warehouse facilities
|
(2,052,041
|
)
|
|
(1,667,084
|
)
|
||
Settlement of pre-Spin-Off related party receivables
|
—
|
|
|
27,044
|
|
||
Borrowing of debt
|
365,000
|
|
|
50,000
|
|
||
Repayment of debt
|
—
|
|
|
(50,000
|
)
|
||
Securities loaned
|
(36,735
|
)
|
|
43,745
|
|
||
Earnings distributions to limited partnership interests and noncontrolling interests
|
(36,749
|
)
|
|
(33,951
|
)
|
||
Dividends to stockholders
|
(17,773
|
)
|
|
(16,043
|
)
|
||
Payments on acquisition earn-outs
|
(1,759
|
)
|
|
—
|
|
||
Payment of deferred financing costs
|
(2,340
|
)
|
|
(32
|
)
|
||
Net cash (used in) provided by financing activities
|
763,318
|
|
|
(91,878
|
)
|
||
Net increase (decrease) in cash and cash equivalents and restricted cash
|
129,717
|
|
|
(49,573
|
)
|
||
Cash and cash equivalents and restricted cash at beginning of period
|
221,872
|
|
|
187,406
|
|
||
Cash and cash equivalents and restricted cash at end of period
|
$
|
351,589
|
|
|
$
|
137,833
|
|
Supplemental disclosures of cash flow information:
|
|
|
|
||||
Cash paid during the period for:
|
|
|
|
|
|
||
Interest
|
$
|
1,122
|
|
|
$
|
288
|
|
Taxes
|
$
|
56,544
|
|
|
$
|
59,279
|
|
Supplemental disclosure of non-cash operating, investing and financing activities:
|
|
|
|
||||
Right-of-use assets and liabilities
|
$
|
12,245
|
|
|
$
|
182,180
|
|
(1)
|
Organization and Basis of Presentation
|
(a)
|
Basis of Presentation
|
•
|
Charges with respect to the grant of shares of common stock or limited partnership units, such as HDUs, including in connection with the redemption of non-exchangeable limited partnership units, including PSUs;
|
•
|
Charges with respect to grants of exchangeability, such as the right of holders of limited partnership units with no capital accounts, such as PSUs, to exchange the units into shares of common stock, or HDUs, as well as the cash paid in the settlement of the related preferred units to pay withholding taxes owed by the unit holder upon such exchange;
|
•
|
Preferred units are granted in connection with the grant of certain limited partnership units, such as PSUs, that may be granted exchangeability to cover the withholding taxes owed by the unit holder, rather than issuing the gross amount of shares to employees, subject to cashless withholding of shares to pay applicable withholding taxes;
|
•
|
Charges related to the amortization of RSUs and limited partnership units; and
|
•
|
Allocations of net income to limited partnership units and founding/working partner units (“FPUs”), including the Preferred Distribution (as hereinafter defined).
|
(b)
|
Recently Adopted Accounting Pronouncements
|
(c)
|
New Accounting Pronouncements
|
(3)
|
Summary of Significant Accounting Policies
|
|
Three months ended March 31,
|
||||||
|
2020
|
|
2019
|
||||
Leasing and other commissions
|
$
|
140,439
|
|
|
$
|
172,471
|
|
Capital markets commissions
|
127,923
|
|
|
102,797
|
|
||
Gains from mortgage banking activities/origination, net
|
50,422
|
|
|
31,346
|
|
||
Management services, servicing fees and other
|
165,146
|
|
|
141,042
|
|
||
Revenues
|
$
|
483,930
|
|
|
$
|
447,656
|
|
(4)
|
Acquisitions
|
|
As of the
Acquisition Date |
||
Purchase Price
|
|
|
|
Cash and stock issued at closing
|
$
|
6,249
|
|
Contingent consideration
|
3,590
|
|
|
Total
|
$
|
9,839
|
|
|
|
||
Allocations
|
|
||
Goodwill
|
$
|
6,294
|
|
Other intangible assets, net
|
2,700
|
|
|
Receivables, net
|
796
|
|
|
Fixed Assets, net
|
134
|
|
|
Other assets
|
29
|
|
|
Accounts payable, accrued expenses and other liabilities
|
(114
|
)
|
|
Total
|
$
|
9,839
|
|
|
As of the
Acquisition Date |
||
Purchase Price
|
|
|
|
Cash, stock and units issued at closing
|
$
|
38,826
|
|
Contingent consideration
|
18,067
|
|
|
Total
|
$
|
56,893
|
|
|
|
|
|
Allocations
|
|
||
Cash
|
$
|
1,391
|
|
Goodwill
|
43,804
|
|
|
Other intangible assets, net
|
9,641
|
|
|
Receivables, net
|
7,540
|
|
|
Other assets
|
614
|
|
|
Accounts payable, accrued expenses and other liabilities
|
(3,972
|
)
|
|
Accrued compensation
|
(2,125
|
)
|
|
Total
|
$
|
56,893
|
|
|
Three months ended March 31,
|
||||||
|
2020
|
|
2019
|
||||
Basic earnings per share:
|
|
|
|
|
|
||
Net income available to common stockholders (1)
|
$
|
5,737
|
|
|
$
|
13,680
|
|
Basic weighted-average shares of common stock outstanding
|
177,545
|
|
|
178,611
|
|
||
Basic earnings per share
|
$
|
0.03
|
|
|
$
|
0.08
|
|
(1)
|
Includes a reduction for dividends on preferred stock or units in the amount of $2.4 million and $3.2 million for the years ended March 31, 2020 and 2019.
|
|
Three Months Ended March 31,
|
||||||
|
2020
|
|
2019
|
||||
Fully diluted earnings per share:
|
|
|
|
||||
Net income available to common stockholders
|
$
|
5,737
|
|
|
$
|
13,680
|
|
Allocations of net income (loss) to limited partnership interests in Newmark Holdings, net of tax
|
3,196
|
|
|
8,288
|
|
||
Net income for fully diluted shares
|
$
|
8,933
|
|
|
$
|
21,968
|
|
Weighted-average shares:
|
|
|
|
||||
Common stock outstanding
|
177,545
|
|
|
178,611
|
|
||
Partnership units (1)
|
84,491
|
|
|
89,991
|
|
||
RSUs (Treasury stock method)
|
1,370
|
|
|
—
|
|
||
Newmark exchange shares
|
240
|
|
|
455
|
|
||
Fully diluted weighted-average shares of common stock outstanding
|
263,646
|
|
|
269,057
|
|
||
Fully diluted earnings per share
|
$
|
0.03
|
|
|
$
|
0.08
|
|
(1)
|
Partnership units collectively include founding/working partner units, limited partnership units, and Cantor and BGC units (see Note 2 — “Limited Partnership Interests in Newmark Holdings and BGC Holdings” for more information).
|
|
Three Months Ended March 31,
|
||||
|
2020
|
|
2019
|
||
Shares outstanding at beginning of period
|
156,265,461
|
|
|
156,916,336
|
|
Share issuances:
|
|
|
|
||
LPU redemption/exchange (1)
|
181,872
|
|
|
374,930
|
|
Issuance of Class A common stock for Newmark RSUs
|
254,413
|
|
|
123,199
|
|
Other
|
—
|
|
|
8,451
|
|
Shares outstanding at end of period
|
156,701,746
|
|
|
157,422,916
|
|
(1)
|
Because they were included in the Newmark’s fully diluted share count, if dilutive, any exchange of LPUs into Class A common stock would not impact the fully diluted number of shares and units outstanding.
|
Period
|
Total
Number of
Shares
Repurchased/Purchased
|
|
Average
Price Paid
per Unit
or Share
|
|
Total Number of Shares Repurchased as Part of Publicly Announced Program
|
|
Approximate
Dollar Value
of Units and
Shares That
May Yet Be
Repurchased/
Purchased
Under the
Program
|
||||||
Balance, January 1, 2020
|
4,568,002
|
|
|
$
|
9.32
|
|
|
4,568,002
|
|
|
$
|
157,413
|
|
January 1, 2020 - March 31, 2020
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||
Total
|
4,568,002
|
|
|
$
|
—
|
|
|
4,568,002
|
|
|
$
|
157,413
|
|
|
March 31,
2020 |
|
December 31,
2019 |
||||
Balance at beginning of period:
|
$
|
21,517
|
|
|
$
|
26,170
|
|
Income allocation
|
—
|
|
|
5,288
|
|
||
Distributions of income
|
—
|
|
|
(5,355
|
)
|
||
Redemptions
|
(138
|
)
|
|
(927
|
)
|
||
Issuance and other
|
—
|
|
|
(3,659
|
)
|
||
Balance at end of period
|
$
|
21,379
|
|
|
$
|
21,517
|
|
(8)
|
Investments
|
(9)
|
Capital and Liquidity Requirements
|
(10)
|
Loans Held for Sale, at Fair Value
|
|
Cost Basis
|
|
Fair Value
|
||||
March 31, 2020
|
$
|
703,321
|
|
|
$
|
739,383
|
|
December 31, 2019
|
210,116
|
|
|
215,290
|
|
(11)
|
Derivatives
|
|
As of March 31, 2020
|
|
As of December 31, 2019
|
||||||||||||||||||||
Derivative contract
|
Assets
|
|
Liabilities
|
|
Notional
Amounts(1)
|
|
Assets
|
|
Liabilities
|
|
Notional
Amounts(1)
|
||||||||||||
Rate lock commitments
|
$
|
58,752
|
|
|
$
|
—
|
|
|
$
|
479,976
|
|
|
$
|
32,035
|
|
|
$
|
12,124
|
|
|
$
|
1,396,827
|
|
Nasdaq Forwards
|
47,675
|
|
|
—
|
|
|
267,480
|
|
|
26,502
|
|
|
—
|
|
|
267,480
|
|
||||||
Forward sale contracts
|
229
|
|
|
77,909
|
|
|
1,183,298
|
|
|
14,389
|
|
|
13,537
|
|
|
1,606,943
|
|
||||||
Total
|
$
|
106,656
|
|
|
$
|
77,909
|
|
|
$
|
1,930,754
|
|
|
$
|
72,926
|
|
|
$
|
25,661
|
|
|
$
|
3,271,250
|
|
(1)
|
Notional amounts represent the sum of gross long and short derivative contracts, an indication of the volume of Newmark’s derivative activity, and do not represent anticipated losses.
|
|
Location of gain (loss) recognized
in income for derivatives
|
|
Three Months Ended March 31,
|
||||||
|
|
2020
|
|
2019
|
|||||
Derivatives not designed as hedging instruments:
|
|
|
|
|
|
|
|
||
Nasdaq Forwards
|
Other income (loss), net
|
|
$
|
21,173
|
|
|
$
|
(13,329
|
)
|
Rate lock commitments
|
Gains from mortgage banking activities/originations, net
|
|
60,163
|
|
|
7,087
|
|
||
Rate lock commitments
|
Compensation and employee benefits
|
|
(1,411
|
)
|
|
(2,067
|
)
|
||
Forward sale contracts
|
Gains from mortgage banking activities/originations, net
|
|
(77,680
|
)
|
|
(3,632
|
)
|
||
Total
|
|
|
$
|
2,245
|
|
|
$
|
(11,941
|
)
|
(12)
|
Credit Enhancement Receivable, Contingent Liability and Credit Enhancement Deposit
|
|
March 31,
2020 |
|
December 31,
2019 |
||||
Total credit risk loan portfolio
|
$
|
20,853,783
|
|
|
$
|
20,209,577
|
|
Maximum DB Cayman credit protection
|
29,021
|
|
|
29,253
|
|
||
|
|
|
|
||||
Maximum pre-credit enhancement loss exposure
|
$
|
6,124,007
|
|
|
$
|
5,835,163
|
|
Maximum DB Cayman credit protection
|
9,674
|
|
|
9,751
|
|
||
Maximum loss exposure without any form of credit protection
|
$
|
6,114,333
|
|
|
$
|
5,825,412
|
|
|
Three Months Ended March 31,
|
||||||
|
2020
|
|
2019
|
||||
Revenues from contracts with customers:
|
|
|
|
||||
Leasing and other commissions
|
$
|
140,439
|
|
|
$
|
172,471
|
|
Capital markets commissions
|
127,923
|
|
|
102,797
|
|
||
Management services
|
125,571
|
|
|
98,089
|
|
||
Total
|
393,933
|
|
|
373,357
|
|
||
Other sources of revenue:
|
|
|
|
||||
Gains from mortgage banking activities/originations, net(1)
|
50,422
|
|
|
31,346
|
|
||
Servicing fees and other(1)
|
39,575
|
|
|
42,953
|
|
||
Total
|
$
|
483,930
|
|
|
$
|
447,656
|
|
(1)
|
Although these items have customers under contract, they were recorded as other sources of revenue as they were excluded from the scope of ASU No. 2014-9.
|
(14)
|
Gains from Mortgage Banking Activities/Originations, Net
|
|
Three Months Ended March 31,
|
||||||
|
2020
|
|
2019
|
||||
Fair value of expected net future cash flows from servicing recognized at commitment, net
|
$
|
29,347
|
|
|
$
|
16,378
|
|
Loan originations related fees and sales premiums, net
|
21,075
|
|
|
14,968
|
|
||
Total
|
$
|
50,422
|
|
|
$
|
31,346
|
|
(15)
|
Mortgage Servicing Rights, Net
|
|
Three Months Ended March 31,
|
||||||
Mortgage Servicing Rights
|
2020
|
|
2019
|
||||
Beginning Balance
|
$
|
432,666
|
|
|
$
|
416,131
|
|
Additions
|
38,967
|
|
|
17,254
|
|
||
Purchases from an affiliate
|
92
|
|
|
298
|
|
||
Amortization
|
(22,334
|
)
|
|
(20,679
|
)
|
||
Ending Balance
|
$
|
449,391
|
|
|
$
|
413,004
|
|
|
|
|
|
||||
Valuation Allowance
|
|
|
|
||||
Beginning Balance
|
$
|
(19,022
|
)
|
|
$
|
(4,322
|
)
|
Decrease (increase)
|
(17,556
|
)
|
|
(1,722
|
)
|
||
Ending Balance
|
$
|
(36,578
|
)
|
|
$
|
(6,044
|
)
|
Net Balance
|
$
|
412,813
|
|
|
$
|
406,960
|
|
|
Three Months Ended March 31,
|
||||||
|
2020
|
|
2019
|
||||
Servicing fees
|
$
|
26,665
|
|
|
$
|
25,631
|
|
Escrow interest and placement fees
|
3,392
|
|
|
5,363
|
|
||
Ancillary fees
|
2,241
|
|
|
3,184
|
|
||
Total
|
$
|
32,298
|
|
|
$
|
34,178
|
|
Balance, January 1, 2019
|
$
|
515,321
|
|
Acquisitions
|
43,804
|
|
|
Measurement period adjustments
|
(1,211
|
)
|
|
Balance, December 31, 2019
|
557,914
|
|
|
Acquisitions
|
6,294
|
|
|
Measurement period adjustments
|
(4,994
|
)
|
|
Balance, March 31, 2020
|
$
|
559,214
|
|
|
March 31, 2020
|
||||||||||||
|
Gross
Amount
|
|
Accumulated
Amortization
|
|
Net
Carrying
Amount
|
|
Weighted-
Average
Remaining
Life (Years)
|
||||||
Indefinite life:
|
|
|
|
|
|
|
|
|
|
|
|||
Trademark and trade names
|
$
|
11,350
|
|
|
$
|
—
|
|
|
$
|
11,350
|
|
|
N/A
|
License agreements (GSE)
|
5,390
|
|
|
—
|
|
|
5,390
|
|
|
N/A
|
|||
Definite life:
|
|
|
|
|
|
|
|
||||||
Trademark and trade names
|
10,861
|
|
|
(9,210
|
)
|
|
1,651
|
|
|
0.2
|
|||
Non-contractual customers
|
30,431
|
|
|
(6,977
|
)
|
|
23,454
|
|
|
0.7
|
|||
License agreements
|
4,981
|
|
|
(3,535
|
)
|
|
1,446
|
|
|
0.1
|
|||
Non-compete agreements
|
6,907
|
|
|
(2,674
|
)
|
|
4,233
|
|
|
0.6
|
|||
Contractual customers
|
3,052
|
|
|
(1,279
|
)
|
|
1,773
|
|
|
0.0
|
|||
Below market leases
|
941
|
|
|
(158
|
)
|
|
783
|
|
|
0.3
|
|||
Total
|
$
|
73,913
|
|
|
$
|
(23,833
|
)
|
|
$
|
50,080
|
|
|
0.6
|
|
December 31, 2019
|
||||||||||||
|
Gross
Amount
|
|
Accumulated
Amortization
|
|
Net
Carrying
Amount
|
|
Weighted-
Average
Remaining
Life (Years)
|
||||||
Indefinite life:
|
|
|
|
|
|
|
|
|
|
|
|||
Trademark and trade names
|
$
|
11,350
|
|
|
$
|
—
|
|
|
$
|
11,350
|
|
|
N/A
|
License agreements (GSE)
|
5,390
|
|
|
—
|
|
|
5,390
|
|
|
N/A
|
|||
Definite life:
|
|
|
|
|
|
|
|
||||||
Trademark and trade names
|
10,511
|
|
|
(9,070
|
)
|
|
1,441
|
|
|
0.3
|
|||
Non-contractual customers
|
24,262
|
|
|
(6,109
|
)
|
|
18,153
|
|
|
0.8
|
|||
License agreements
|
4,981
|
|
|
(3,288
|
)
|
|
1,693
|
|
|
0.1
|
|||
Non-compete agreements
|
6,953
|
|
|
(2,434
|
)
|
|
4,519
|
|
|
0.7
|
|||
Contractual customers
|
3,052
|
|
|
(1,177
|
)
|
|
1,875
|
|
|
0.0
|
|||
Below market leases
|
941
|
|
|
(136
|
)
|
|
805
|
|
|
0.3
|
|||
Total
|
$
|
67,440
|
|
|
$
|
(22,214
|
)
|
|
$
|
45,226
|
|
|
1.2
|
2020
|
$
|
6,011
|
|
2021
|
6,831
|
|
|
2022
|
4,766
|
|
|
2023
|
4,256
|
|
|
2024
|
3,403
|
|
|
Thereafter
|
8,073
|
|
|
Total
|
$
|
33,340
|
|
|
March 31,
2020 |
|
December 31,
2019 |
||||
Leasehold improvements and other fixed assets
|
$
|
125,601
|
|
|
$
|
119,682
|
|
Software, including software development costs
|
28,376
|
|
|
28,063
|
|
||
Computer and communications equipment
|
24,330
|
|
|
23,028
|
|
||
Total, cost
|
178,307
|
|
|
170,773
|
|
||
Accumulated depreciation and amortization
|
(75,246
|
)
|
|
(72,757
|
)
|
||
Total, net
|
$
|
103,061
|
|
|
$
|
98,016
|
|
|
March 31,
2020 |
|
December 31,
2019 |
||||
2020
|
$
|
34,019
|
|
|
$
|
44,709
|
|
2021
|
42,881
|
|
|
42,612
|
|
||
2022
|
39,847
|
|
|
39,812
|
|
||
2023
|
38,254
|
|
|
38,210
|
|
||
2024
|
35,664
|
|
|
35,602
|
|
||
Thereafter
|
146,572
|
|
|
146,463
|
|
||
Total lease payments
|
337,237
|
|
|
347,408
|
|
||
Less: Interest
|
87,717
|
|
|
92,282
|
|
||
Present value of lease liability
|
$
|
249,520
|
|
|
$
|
255,126
|
|
|
March 31,
2020 |
|
December 31,
2019 |
||||
Derivative assets
|
$
|
69,821
|
|
|
$
|
51,021
|
|
Other taxes
|
45,615
|
|
|
22,483
|
|
||
Prepaid expenses
|
14,577
|
|
|
15,251
|
|
||
Rent and other deposits
|
1,459
|
|
|
1,703
|
|
||
Other
|
179
|
|
|
736
|
|
||
Total
|
$
|
131,651
|
|
|
$
|
91,194
|
|
|
March 31,
2020 |
|
December 31,
2019 |
||||
Deferred tax assets
|
$
|
189,653
|
|
|
$
|
182,781
|
|
Derivative assets
|
36,835
|
|
|
21,905
|
|
||
Equity method investment
|
99,966
|
|
|
99,966
|
|
||
Non-marketable investments
|
77,275
|
|
|
94,113
|
|
||
Other
|
9,373
|
|
|
9,133
|
|
||
Total
|
$
|
413,102
|
|
|
$
|
407,898
|
|
|
Committed
Lines
|
|
Uncommitted
Lines
|
|
Balance at March 31, 2020
|
|
Balance at December 31, 2019
|
|
Stated Spread
to One-Month
LIBOR
|
|
Rate Type
|
||||||||
Warehouse facility due June 17, 2020(1)
|
$
|
450,000
|
|
|
$
|
—
|
|
|
$
|
182,159
|
|
|
$
|
16,759
|
|
|
115 bps
|
|
Variable
|
Warehouse facility due June 17, 2020
|
—
|
|
|
300,000
|
|
|
—
|
|
|
—
|
|
|
110 bps
|
|
Variable
|
||||
Warehouse facility due September 25, 2020
|
200,000
|
|
|
—
|
|
|
119,981
|
|
|
8,097
|
|
|
115 bps
|
|
Variable
|
||||
Warehouse facility due October 9, 2020(2)
|
400,000
|
|
|
—
|
|
|
389,260
|
|
|
34,125
|
|
|
115 bps
|
|
Variable
|
||||
Fannie Mae repurchase agreement, open maturity
|
—
|
|
|
400,000
|
|
|
11,921
|
|
|
150,667
|
|
|
105 bps
|
|
Variable
|
||||
Total
|
$
|
1,050,000
|
|
|
$
|
700,000
|
|
|
$
|
703,321
|
|
|
$
|
209,648
|
|
|
|
|
|
(1)
|
This warehouse line was temporarily increased by $350.0 million to $800.0 million for the period January 13, 2020 to March 30, 2020.
|
(2)
|
This warehouse line was temporarily increased by $100.0 million to $500.0 million for the period January 29, 2020 to March 13, 2020.
|
|
March 31,
2020 |
|
December 31,
2019 |
||||
6.125% Senior Notes
|
$
|
540,969
|
|
|
$
|
540,377
|
|
Credit Facility
|
411,787
|
|
|
48,917
|
|
||
Total
|
$
|
952,756
|
|
|
$
|
589,294
|
|
|
March 31,
2020 |
|
December 31,
2019 |
||||
6.125% Senior Notes principal balance
|
$
|
550,000
|
|
|
$
|
550,000
|
|
Less: debt issue cost
|
4,651
|
|
|
4,972
|
|
||
Less: debt discount
|
4,380
|
|
|
4,651
|
|
||
Total
|
$
|
540,969
|
|
|
$
|
540,377
|
|
|
Three Months Ended March 31,
|
||||||
|
2020
|
|
2019
|
||||
Interest expense
|
$
|
8,693
|
|
|
$
|
8,676
|
|
Debt issue cost amortization
|
321
|
|
|
319
|
|
||
Debt discount amortization
|
271
|
|
|
254
|
|
||
Total
|
$
|
9,285
|
|
|
$
|
9,249
|
|
|
March 31,
2020 |
|
December 31,
2019 |
||||
Credit Facility principal balance
|
$
|
415,000
|
|
|
$
|
50,000
|
|
Less: Debt issue cost
|
3,213
|
|
|
1,083
|
|
||
Total
|
$
|
411,787
|
|
|
$
|
48,917
|
|
|
Three Months Ended March 31,
|
||||||
|
2020
|
|
2019
|
||||
Interest expense
|
$
|
1,360
|
|
|
$
|
112
|
|
Debt issue cost amortization
|
186
|
|
|
141
|
|
||
Unused facility fee
|
109
|
|
|
180
|
|
||
Total
|
$
|
1,655
|
|
|
$
|
433
|
|
Balance, January 1, 2020
|
$
|
15
|
|
Impact of adopting ASC 326
|
17,935
|
|
|
Provision for expected credit losses
|
14,480
|
|
|
Balance, March 31, 2020
|
$
|
32,430
|
|
•
|
Level 1 measurements—Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities.
|
•
|
Level 2 measurements—Quoted prices in markets that are not active or financial instruments for which all significant inputs are observable, either directly or indirectly.
|
•
|
Level 3 measurements—Prices or valuations that require inputs that are both significant to the fair value measurement and unobservable.
|
|
As of March 31, 2020
|
||||||||||||||
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
||||
Nasdaq Forwards
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
47,675
|
|
|
$
|
47,675
|
|
Loans held for sale, at fair value
|
—
|
|
|
739,383
|
|
|
—
|
|
|
739,383
|
|
||||
Rate lock commitments
|
—
|
|
|
—
|
|
|
58,752
|
|
|
58,752
|
|
||||
Forward sale contracts
|
—
|
|
|
—
|
|
|
229
|
|
|
229
|
|
||||
Total
|
$
|
—
|
|
|
$
|
739,383
|
|
|
$
|
106,656
|
|
|
$
|
846,039
|
|
Liabilities:
|
|
|
|
|
|
|
|
||||||||
Contingent consideration
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
33,337
|
|
|
$
|
33,337
|
|
Forward sale contracts
|
—
|
|
|
—
|
|
|
77,909
|
|
|
77,909
|
|
||||
Total
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
111,246
|
|
|
$
|
111,246
|
|
|
As of December 31, 2019
|
||||||||||||||
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
||||
Marketable securities
|
$
|
36,795
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
36,795
|
|
Nasdaq Forwards
|
—
|
|
|
—
|
|
|
26,502
|
|
|
26,502
|
|
||||
Loans held for sale, at fair value
|
—
|
|
|
215,290
|
|
|
—
|
|
|
215,290
|
|
||||
Rate lock commitments
|
—
|
|
|
—
|
|
|
32,035
|
|
|
32,035
|
|
||||
Forward sale contracts
|
—
|
|
|
—
|
|
|
14,389
|
|
|
14,389
|
|
||||
Total
|
$
|
36,795
|
|
|
$
|
215,290
|
|
|
$
|
72,926
|
|
|
$
|
325,011
|
|
Liabilities:
|
|
|
|
|
|
|
|
||||||||
Contingent consideration
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
45,172
|
|
|
$
|
45,172
|
|
Rate lock commitments
|
—
|
|
|
—
|
|
|
12,124
|
|
|
12,124
|
|
||||
Forwards sale contracts
|
—
|
|
|
—
|
|
|
13,537
|
|
|
13,537
|
|
||||
Total
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
70,833
|
|
|
$
|
70,833
|
|
|
As of March 31, 2020
|
||||||||||||||||||||||
|
Opening
Balance
|
|
Total realized
and unrealized
gains (losses)
included in
Net income
|
|
Issuances
|
|
Settlements
|
|
Closing
Balance
|
|
Unrealized
gains (losses)
outstanding
as of
March 31,
2020
|
||||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Rate lock commitments
|
$
|
32,035
|
|
|
$
|
58,752
|
|
|
$
|
—
|
|
|
$
|
(32,035
|
)
|
|
$
|
58,752
|
|
|
$
|
58,752
|
|
Forward sale contracts
|
14,389
|
|
|
229
|
|
|
—
|
|
|
(14,389
|
)
|
|
229
|
|
|
229
|
|
||||||
Nasdaq Forwards
|
26,502
|
|
|
21,173
|
|
|
—
|
|
|
—
|
|
|
47,675
|
|
|
47,675
|
|
||||||
Total
|
$
|
72,926
|
|
|
$
|
80,154
|
|
|
$
|
—
|
|
|
$
|
(46,424
|
)
|
|
$
|
106,656
|
|
|
$
|
106,656
|
|
|
Opening
Balance
|
|
Total realized
and unrealized
(gains) losses
included in
Net income
|
|
Issuances
|
|
Settlements
|
|
Closing
Balance
|
|
Unrealized
(gains) losses
outstanding
as of
March 31,
2020
|
||||||||||||
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Contingent consideration
|
$
|
45,172
|
|
|
$
|
(12,113
|
)
|
|
$
|
2,221
|
|
|
$
|
(1,943
|
)
|
|
$
|
33,337
|
|
|
$
|
700
|
|
Rate lock commitments
|
12,124
|
|
|
—
|
|
|
|
|
|
(12,124
|
)
|
|
—
|
|
|
—
|
|
||||||
Forward sale contracts
|
13,537
|
|
|
77,909
|
|
|
—
|
|
|
(13,537
|
)
|
|
77,909
|
|
|
77,909
|
|
||||||
Total
|
$
|
70,833
|
|
|
$
|
65,796
|
|
|
$
|
2,221
|
|
|
$
|
(27,604
|
)
|
|
$
|
111,246
|
|
|
$
|
78,609
|
|
|
As of December 31, 2019
|
||||||||||||||||||||||
|
Opening
Balance
|
|
Total realized
and unrealized
gains (losses)
included in
Net income
|
|
Issuances
|
|
Settlements
|
|
Closing
Balance
|
|
Unrealized
gains (losses)
outstanding
as of
December 31,
2019
|
||||||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Rate lock commitments
|
$
|
6,732
|
|
|
$
|
32,035
|
|
|
$
|
—
|
|
|
$
|
(6,732
|
)
|
|
$
|
32,035
|
|
|
$
|
32,035
|
|
Forward sale contracts
|
8,177
|
|
|
14,389
|
|
|
—
|
|
|
(8,177
|
)
|
|
14,389
|
|
|
14,389
|
|
||||||
Nasdaq Forwards
|
77,619
|
|
|
(51,117
|
)
|
|
—
|
|
|
—
|
|
|
26,502
|
|
|
26,502
|
|
||||||
Total
|
$
|
92,528
|
|
|
$
|
(4,693
|
)
|
|
$
|
—
|
|
|
$
|
(14,909
|
)
|
|
$
|
72,926
|
|
|
$
|
72,926
|
|
|
Opening
Balance
|
|
Total realized
and unrealized
(gains) losses
included in
Net income
|
|
Issuances
|
|
Settlements
|
|
Closing
Balance
|
|
Unrealized
(gains) losses
outstanding
as of
December 31,
2019
|
||||||||||||
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Contingent consideration
|
$
|
32,551
|
|
|
$
|
2,287
|
|
|
$
|
14,957
|
|
|
$
|
(4,623
|
)
|
|
$
|
45,172
|
|
|
$
|
2,287
|
|
Rate lock commitments
|
7,470
|
|
|
12,124
|
|
|
—
|
|
|
(7,470
|
)
|
|
12,124
|
|
|
12,124
|
|
||||||
Forward sale contracts
|
9,208
|
|
|
13,537
|
|
|
—
|
|
|
(9,208
|
)
|
|
13,537
|
|
|
13,537
|
|
||||||
Total
|
$
|
49,229
|
|
|
$
|
27,948
|
|
|
$
|
14,957
|
|
|
$
|
(21,301
|
)
|
|
$
|
70,833
|
|
|
$
|
27,948
|
|
March 31, 2020
|
||||||||||||||
Level 3 assets and liabilities
|
|
Assets
|
|
Liabilities
|
|
Significant Unobservable
Inputs
|
|
Range
|
|
Weighted
Average
|
||||
Accounts payable, accrued expenses and other liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Contingent consideration
|
|
$
|
—
|
|
|
$
|
33,337
|
|
|
Discount rate
|
|
0.3%-10.4%
|
(1)
|
7.5%
|
|
|
|
|
|
|
Probability of meeting earnout and contingencies
|
|
0%-100%
|
(1)
|
92.1%
|
||||
|
|
|
|
|
|
Financial forecast information
|
|
|
|
|
||||
Derivative assets and liabilities:
|
|
|
|
|
|
|
|
|
|
|
||||
Nasdaq Forwards
|
|
$
|
47,675
|
|
|
$
|
—
|
|
|
Implied volatility
|
|
35.8% - 40.9%
|
(2)
|
39.8%
|
Forward sale contracts
|
|
$
|
229
|
|
|
$
|
77,909
|
|
|
Counterparty credit risk
|
|
N/A
|
|
N/A
|
Rate lock commitments
|
|
$
|
58,752
|
|
|
$
|
—
|
|
|
Counterparty credit risk
|
|
N/A
|
|
N/A
|
December 31, 2019
|
||||||||||||||
Level 3 assets and liabilities
|
|
Assets
|
|
Liabilities
|
|
Significant Unobservable
Inputs
|
|
Range
|
|
Weighted
Average
|
||||
Accounts payable, accrued expenses and other liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Contingent consideration
|
|
$
|
—
|
|
|
$
|
45,172
|
|
|
Discount rate
|
|
0.3%-10.4%
|
|
8.6%
|
|
|
|
|
|
|
Probability of meeting earnout and contingencies
|
|
90%-100%
|
(1)
|
98.1%
|
||||
|
|
|
|
|
|
Financial forecast information
|
|
|
|
|
||||
Derivative assets and liabilities:
|
|
|
|
|
|
|
|
|
|
|
||||
Nasdaq Forwards
|
|
$
|
26,502
|
|
|
$
|
—
|
|
|
Implied volatility
|
|
25.7%-34.8%
|
(2)
|
32.2%
|
Forward sale contracts
|
|
$
|
14,389
|
|
|
$
|
13,537
|
|
|
Counterparty credit risk
|
|
N/A
|
|
N/A
|
Rate lock commitments
|
|
$
|
32,035
|
|
|
$
|
12,124
|
|
|
Counterparty credit risk
|
|
N/A
|
|
N/A
|
(1)
|
Newmark’s estimate of contingent consideration as of March 31, 2020 and December 31, 2019 was based on the acquired business’ projected future financial performance, including revenues.
|
•
|
The underlying number of shares and the related strike price;
|
•
|
The maturity date; and
|
•
|
The implied volatility of Nasdaq’s stock price.
|
(a)
|
Service Agreements
|
|
March 31,
2020 |
|
December 31,
2019 |
||||
Accounts payable and accrued expenses
|
$
|
154,933
|
|
|
$
|
189,172
|
|
Payroll taxes payable
|
47,869
|
|
|
45,612
|
|
||
Derivative liability
|
77,909
|
|
|
25,661
|
|
||
Outside broker payable
|
60,078
|
|
|
74,280
|
|
||
Credit enhancement deposit
|
25,000
|
|
|
—
|
|
||
Corporate and other taxes payable
|
18,217
|
|
|
69,237
|
|
||
Contingent consideration
|
15,841
|
|
|
13,107
|
|
||
Total
|
$
|
399,847
|
|
|
$
|
417,069
|
|
|
March 31,
2020 |
|
December 31,
2019 |
||||
Accrued compensation
|
284,349
|
|
|
278,399
|
|
||
Financial guarantee liability
|
$
|
32,430
|
|
|
$
|
15
|
|
Payroll taxes payable
|
$
|
59,926
|
|
|
$
|
41,355
|
|
Contingent consideration
|
17,496
|
|
|
32,065
|
|
||
Credit enhancement deposit
|
—
|
|
|
25,000
|
|
||
Total
|
$
|
394,201
|
|
|
$
|
376,834
|
|
(30)
|
Compensation
|
|
Three Months Ended March 31,
|
||||||
|
2020
|
|
2019
|
||||
Issuance of common stock and exchangeability expenses
|
$
|
8,119
|
|
|
$
|
661
|
|
Allocations of net income (1)
|
549
|
|
|
6,313
|
|
||
Limited partnership units amortization
|
1,895
|
|
|
6,335
|
|
||
RSU amortization
|
2,351
|
|
|
562
|
|
||
Equity-based compensation and allocations of net income to limited partnership units and FPUs (2)
|
$
|
12,914
|
|
|
$
|
13,871
|
|
(1)
|
Certain limited partnership units receive quarterly allocations of net income and are generally contingent upon services being provided by the unit holders, including the Preferred Distribution.
|
(2)
|
Reclassifications have been made to previously reported amounts to conform to the new presentation (see Note 1 — “Organization and Basis of Presentation”).
|
(a)
|
Limited Partnership Units
|
|
BGC Units
|
|
Newmark Units
|
|
||
Balance, January 1, 2019
|
61,870,969
|
|
|
44,733,487
|
|
(1)
|
Granted
|
319,586
|
|
|
13,813,204
|
|
|
Redeemed/exchanged units
|
(3,938,134
|
)
|
|
(2,487,885
|
)
|
|
Forfeited units/other
|
(2,198,720
|
)
|
|
4,742,046
|
|
|
Balance, December 31, 2019
|
56,053,701
|
|
|
60,800,852
|
|
|
Granted
|
884,335
|
|
|
1,650,749
|
|
|
Redeemed/exchanged units
|
(439,178
|
)
|
|
(588,031
|
)
|
|
Forfeited units/other
|
—
|
|
|
(677
|
)
|
|
Balance, March 31, 2020
|
56,498,858
|
|
|
61,862,893
|
|
|
|
|
|
|
|
||
Total exchangeable units outstanding:
|
|
|
|
|
||
December 31, 2019
|
24,692,695
|
|
|
10,108,598
|
|
|
March 31, 2020
|
24,353,910
|
|
|
9,902,345
|
|
|
(1)
|
Represents the pre-IPO Newmark employees share-equivalent limited partnership units in BGC Holdings.
|
|
BGC
Units
|
|
Newmark
Units
|
||
Regular units
|
54,956,732
|
|
|
58,256,181
|
|
Preferred Units
|
1,542,126
|
|
|
3,606,712
|
|
Balance, March 31, 2020
|
56,498,858
|
|
|
61,862,893
|
|
|
Three Months Ended March 31,
|
||||
|
2020
|
|
2019
|
||
BGC Holdings units
|
149,280
|
|
|
58,855
|
|
Newmark Holdings units
|
142,441
|
|
|
29,690
|
|
Total
|
291,721
|
|
|
88,545
|
|
|
Three Months Ended March 31,
|
||||||
|
2020
|
|
2019
|
||||
Issuance of common stock and exchangeability expenses
|
$
|
2,474
|
|
|
$
|
661
|
|
|
March 31,
2020 |
|
December 31,
2019 |
||||
Notional Value(1)
|
$
|
240,251
|
|
|
$
|
261,025
|
|
Estimated fair value of the post-termination payout(2)
|
$
|
59,925
|
|
|
$
|
58,149
|
|
Outstanding limited partnership units in BGC Holdings
|
5,323,593
|
|
|
6,251,816
|
|
||
Outstanding limited partnership units in BGC Holdings - unvested
|
1,163,775
|
|
|
1,508,510
|
|
||
Outstanding limited partnership units in Newmark Holdings
|
16,138,694
|
|
|
17,097,639
|
|
||
Outstanding limited partnership units in Newmark Holdings - unvested
|
8,678,865
|
|
|
9,357,822
|
|
(1)
|
Beginning January 1, 2018, Newmark began granting stand-alone limited partnership units in Newmark Holdings to Newmark employees.
|
(2)
|
Included in “Other long-term liabilities” on the accompanying unaudited condensed consolidated balance sheets.
|
|
Three Months Ended March 31,
|
||||||
|
2020
|
|
2019
|
||||
Limited partnership units amortization
|
$
|
1,895
|
|
|
$
|
6,335
|
|
|
March 31,
2020 |
|
December 31,
2019 |
||||
Notional Value
|
$
|
193,278
|
|
|
$
|
194,995
|
|
Estimated fair value of limited partnership units (1)
|
$
|
187,503
|
|
|
$
|
182,800
|
|
(1)
|
Included in “Other long-term liabilities” on the accompanying unaudited condensed consolidated balance sheets.
|
|
Three Months Ended March 31,
|
||||||
|
2020
|
|
2019
|
||||
Issuance of common stock and exchangeability expenses
|
$
|
5,645
|
|
|
$
|
—
|
|
(b)
|
Restricted Stock Units
|
|
BGC RSUs(1)
|
|
Newmark RSUs(2)
|
||||||||||||||||
|
Restricted
Stock Units |
Weighted-
Average Grant Date Fair Value
Per Share
|
Fair
Value
Amount
|
Weighted-
Average Remaining Contractual Term (Years) |
|
Restricted
Stock Units |
Weighted-
Average Grant Date Fair Value
Per Share
|
Fair
Value
Amount
|
Weighted-
Average Remaining Contractual Term (Years) |
||||||||||
Balance, January 1, 2019
|
168,675
|
|
$
|
9.77
|
|
$
|
1,619
|
|
0.98
|
|
219,887
|
|
$
|
13.52
|
|
$
|
2,973
|
|
2.28
|
Granted
|
—
|
|
—
|
|
—
|
|
|
|
4,766,611
|
|
7.42
|
|
35,344
|
|
|
||||
Settled units (delivered shares)
|
(107,820
|
)
|
9.38
|
|
(1,011
|
)
|
|
|
(109,007
|
)
|
11.70
|
|
(1,275
|
)
|
|
||||
Forfeited units
|
(14,048
|
)
|
10.02
|
|
(141
|
)
|
|
|
(193,920
|
)
|
8.67
|
|
(1,681
|
)
|
|
||||
Balance, December 31, 2019
|
46,807
|
|
$
|
9.97
|
|
$
|
467
|
|
0.25
|
|
4,683,571
|
|
$
|
7.55
|
|
$
|
35,361
|
|
5.69
|
Granted
|
—
|
|
$
|
—
|
|
$
|
—
|
|
|
|
1,686,149
|
|
$
|
9.58
|
|
$
|
16,153
|
|
|
Settled units (delivered shares)
|
(35,825
|
)
|
$
|
10.32
|
|
$
|
(370
|
)
|
|
|
(425,271
|
)
|
$
|
8.50
|
|
$
|
(3,616
|
)
|
|
Forfeited units
|
(857
|
)
|
$
|
10.54
|
|
$
|
(9
|
)
|
|
|
(17,669
|
)
|
$
|
8.54
|
|
$
|
(151
|
)
|
|
Balance, March 31, 2020
|
10,125
|
|
$
|
8.71
|
|
$
|
88
|
|
0.18
|
|
5,926,780
|
|
$
|
8.06
|
|
$
|
47,747
|
|
6.08
|
(1)
|
RSUs granted to these individuals generally vest over a two- to four-year period
|
(2)
|
Beginning January 1, 2018, Newmark began granting stand-alone Newmark RSUs to Newmark employees and the awards vest ratably over the two- to eight-year vesting period into shares of Newmark Class A common stock.
|
|
Three Months Ended March 31,
|
||||||
|
2020
|
|
2019
|
||||
RSU amortization
|
$
|
2,351
|
|
|
$
|
562
|
|
(c)
|
Deferred Compensation
|
(a)
|
Contractual Obligations and Commitments
|
(b)
|
Contingent Payments Related to Acquisitions
|
(c)
|
Contingencies
|
•
|
We expect our leasing and capital markets volumes to be severely negatively impacted by COVID-19 in the near term.
|
•
|
The GSEs financed approximately 70 percent of all multifamily originations in 2008 and 2009, according to the Urban Institute, largely because alternative sources of financing pulled back significantly. We therefore expect the overall GSE/FHA market to perform well in times of overall market stress.
|
•
|
Management and consulting businesses continue to operate with opportunity to expand by assisting clients through these difficult market conditions.
|
•
|
Valuation and Advisory revenues expected to decline in the near term due to weaker transaction-based activity. In past cycles, these revenues have been partially replaced with distressed activity. In addition, litigation support, property tax and financial reporting remain active.
|
•
|
The Company activated its Business Continuity Plan and implemented a work from home policy. In all cases, the Company has mandated appropriate social distancing measures;
|
•
|
The Company provides ongoing informational COVID-19 related messages and notices;
|
•
|
Where applicable, Newmark is applying more frequent and vigorous hygiene and sanitation measures and providing personal protective equipment;
|
•
|
Internal and external meetings are conducted virtually or via phone calls;
|
•
|
There is a ban on nonessential business travel, while personal travel is discouraged;
|
•
|
Newmark is deferring corporate events and participation in industry conferences;
|
•
|
If relevant, Newmark has deployed clinical staff internally to support its employees and required self-quarantine;
|
•
|
The Company’s medical plans have waived applicable member cost sharing for all diagnostic testing related to COVID-19;
|
•
|
Newmark continues to pay medical, dental, vision, and life insurance contributions for furloughed employees;
|
•
|
The Company also introduced zero co-pay telemedicine visits for general medicine for participants in the U.S. medical plans and their dependents. Newmark has encouraged the use of telemedicine during the pandemic;
|
•
|
The Company has reminded employees about its Employee Assistance Program and the ways it can assist them during this challenging time;
|
•
|
Newmark provides paid leave in accordance with its policies and applicable COVID-19-related laws and regulations;
|
•
|
The Company is developing standardized procedures for reopening its offices safely at the appropriate time; and
|
•
|
Newmark's executive officers volunteered to reduce their annual basis salaries by 50% for Messrs, Lutnick and Gosin and 15% by Messrs, Merkel and Rispoli and Newmark's independent directors volunteered to forego 15% of their annual cash retainer, effective from April 27, 2020 through December 31, 2020.
|
•
|
The Company is providing consulting and advisory services for tenants that need assistance with implementing policies with respect to social distancing, workplace strategy, and portfolio strategies;
|
•
|
Newmark is assisting clients in determining what their real estate needs will be in the short, medium, and long term and how they can devise and implement related strategies;
|
•
|
The Company is enabling commercial real estate owners and investors with respect to appraisals and select ways for them to preserve and create value. The Company is also helping them navigate new requirements resulting from the pandemic related to items including cleaning, social distancing, and remote working; and
|
•
|
Newmark's professionals are in constant communication with many of the largest institutions in the world to discuss debt and asset strategies in this rapidly evolving environment.
|
•
|
Non-cash amortization of intangibles with respect to acquisitions;
|
•
|
Non-cash asset impairment charges with respect to goodwill or other intangible assets;
|
•
|
Non-cash mark-to-market adjustments for non-marketable investments;
|
•
|
Severance charges incurred in connection with headcount reductions as part of broad restructuring plans;
|
•
|
Non-compensation-related charges incurred as part of broad restructuring plans. Such GAAP items may include charges for exiting leases and/or other long-term contracts as part of cost-saving initiatives;
|
•
|
Newmark’s provisions for non-cash credit reserves under the CECL methodology; and
|
•
|
Increased debt in the first quarter of 2020 as a result of an additional drawdown on the Credit Facility.
|
•
|
Leasing and Other Commissions. We offer a diverse range of commercial real estate brokerage and advisory services, including tenant and agency representation, which includes comprehensive lease negotiations, strategic planning, site selection, lease auditing, and other financial and market analysis.
|
•
|
Capital Markets. Our real estate capital markets business specializes in the arrangement of acquisitions and dispositions of commercial properties, as well as providing other financial services, including the arrangement of debt and equity financing, and loan sale advisory.
|
•
|
Gains from Mortgage Banking Activities/Originations, Net. Gains from mortgage banking activities/originations are derived from the origination of loans with borrowers and the sale of those loans to investors.
|
•
|
Management Services, Servicing Fees and Other. We provide commercial services to tenants and landlords. In this business, we provide property and facilities management services along with project management, valuation and appraisal services and other consulting services, as well as technology, to customers who may also utilize our commercial real estate brokerage services. Servicing fees are derived from the servicing of loans originated by us as well as loans originated by third parties.
|
|
Three Months Ended March 31,
|
||||||||||||
|
2020
|
|
2019
|
||||||||||
|
Actual Results
|
|
Percentage of Total Revenues
|
|
Actual Results
|
|
Percentage of Total Revenues
|
||||||
Revenues:
|
|
|
|
|
|
|
|
|
|
|
|||
Leasing and other commissions
|
$
|
140,439
|
|
|
29.0
|
%
|
|
$
|
172,471
|
|
|
38.5
|
%
|
Capital markets
|
127,923
|
|
|
26.4
|
|
|
102,797
|
|
|
23.0
|
|
||
Gains from mortgage banking activities/originations, net
|
50,422
|
|
|
10.4
|
|
|
31,346
|
|
|
7.0
|
|
||
Management services, servicing fees and other
|
165,146
|
|
|
34.1
|
|
|
141,042
|
|
|
31.5
|
|
||
Total revenues
|
483,930
|
|
|
100.0
|
|
|
447,656
|
|
|
100.0
|
|
||
Expenses:
|
|
|
|
|
|
|
|
|
|
||||
Compensation and employee benefits
|
300,257
|
|
|
62.0
|
|
|
263,353
|
|
|
58.8
|
|
||
Equity-based compensation and allocations of net
income to limited partnership units and FPUs (1) |
12,914
|
|
|
2.7
|
|
|
13,871
|
|
|
3.1
|
|
||
Total compensation and employee benefits
|
313,171
|
|
|
64.7
|
|
|
277,224
|
|
|
61.9
|
|
||
Operating, administrative and other
|
92,281
|
|
|
19.1
|
|
|
87,893
|
|
|
19.6
|
|
||
Fees to related parties
|
5,812
|
|
|
1.2
|
|
|
6,725
|
|
|
1.5
|
|
||
Depreciation and amortization
|
46,039
|
|
|
9.5
|
|
|
28,304
|
|
|
6.3
|
|
||
Total operating expenses
|
457,303
|
|
|
94.5
|
|
|
400,146
|
|
|
89.3
|
|
||
Other income, net
|
1,438
|
|
|
0.3
|
|
|
(9,718
|
)
|
|
(2.2
|
)
|
||
Income from operations
|
28,065
|
|
|
5.8
|
|
|
37,792
|
|
|
8.4
|
|
||
Interest (expense) income, net
|
(9,030
|
)
|
|
(1.9
|
)
|
|
(7,699
|
)
|
|
(1.7
|
)
|
||
Income before income taxes and noncontrolling interests
|
19,035
|
|
|
3.9
|
|
|
30,093
|
|
|
6.7
|
|
||
Provision for income taxes
|
4,797
|
|
|
1.0
|
|
|
6,687
|
|
|
1.5
|
|
||
Consolidated net income
|
14,238
|
|
|
2.9
|
|
|
23,406
|
|
|
5.2
|
|
||
Less: Net income attributable to noncontrolling interests
|
6,056
|
|
|
1.3
|
|
|
6,502
|
|
|
1.5
|
|
||
Net income available to common stockholders
|
$
|
8,182
|
|
|
1.7
|
%
|
|
$
|
16,904
|
|
|
3.7
|
%
|
|
Three Months Ended March 31,
|
||||||||||||
|
2020
|
|
2019
|
||||||||||
|
Actual Results
|
|
Percentage of Total Revenues
|
|
Actual Results
|
|
Percentage of Total Revenues
|
||||||
Issuance of common stock and exchangeability expenses
|
$
|
8,119
|
|
|
1.7
|
%
|
|
$
|
661
|
|
|
0.1
|
%
|
Allocations of net income
|
549
|
|
|
0.1
|
|
|
6,313
|
|
|
1.4
|
|
||
Limited partnership units amortization
|
1,895
|
|
|
0.4
|
|
|
6,335
|
|
|
1.4
|
|
||
RSU amortization
|
2,351
|
|
|
0.5
|
|
|
562
|
|
|
0.1
|
|
||
Equity-based compensation and allocations of net income to limited partnership units and FPUs (2)
|
$
|
12,914
|
|
|
2.7
|
%
|
|
$
|
13,871
|
|
|
3.0
|
%
|
(2)
|
Reclassifications have been made to previously reported amounts to conform to the new presentation.
|
|
|
March 31, 2020
|
|
December 31, 2019
|
|
September 30, 2019 (1)
|
|
June 30, 2019
|
|
March 31, 2019
|
|
December 31, 2018
|
|
September 30, 2018 (1)
|
|
June 30, 2018
|
||||||||||||||||
Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Commissions
|
|
$
|
268,362
|
|
|
$
|
416,728
|
|
|
$
|
357,908
|
|
|
$
|
346,131
|
|
|
$
|
275,268
|
|
|
$
|
426,431
|
|
|
$
|
319,340
|
|
|
$
|
279,833
|
|
Gains from mortgage banking
activities/originations, net
|
|
50,422
|
|
|
49,316
|
|
|
72,332
|
|
|
45,091
|
|
|
31,346
|
|
|
49,501
|
|
|
51,972
|
|
|
41,877
|
|
||||||||
Management services, servicing
fees and other
|
|
165,146
|
|
|
166,320
|
|
|
156,394
|
|
|
160,256
|
|
|
141,042
|
|
|
155,759
|
|
|
147,497
|
|
|
144,909
|
|
||||||||
Total revenues
|
|
483,930
|
|
|
632,364
|
|
|
586,634
|
|
|
551,478
|
|
|
447,656
|
|
|
631,691
|
|
|
518,809
|
|
|
466,619
|
|
||||||||
Expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Compensation and employee
benefits
|
|
300,257
|
|
|
354,862
|
|
|
341,036
|
|
|
316,737
|
|
|
263,353
|
|
|
342,876
|
|
|
291,382
|
|
|
266,639
|
|
||||||||
Equity-based compensation and
allocations of net income to
limited partnership units and
FPUs
|
|
12,914
|
|
|
148,965
|
|
|
56,647
|
|
|
39,353
|
|
|
13,871
|
|
|
99,085
|
|
|
40,776
|
|
|
67,367
|
|
||||||||
Total compensation and
employee benefits
|
|
313,171
|
|
|
503,827
|
|
|
397,683
|
|
|
356,090
|
|
|
277,224
|
|
|
441,961
|
|
|
332,158
|
|
|
334,006
|
|
||||||||
Operating, administrative and
other
|
|
92,281
|
|
|
85,918
|
|
|
86,297
|
|
|
101,749
|
|
|
87,893
|
|
|
91,369
|
|
|
84,914
|
|
|
80,048
|
|
||||||||
Fees to related parties
|
|
5,812
|
|
|
3,990
|
|
|
7,088
|
|
|
7,222
|
|
|
6,725
|
|
|
6,323
|
|
|
6,644
|
|
|
6,301
|
|
||||||||
Depreciation and amortization
|
|
46,039
|
|
|
32,634
|
|
|
36,781
|
|
|
33,425
|
|
|
28,304
|
|
|
29,146
|
|
|
25,873
|
|
|
20,201
|
|
||||||||
Total operating expenses
|
|
457,303
|
|
|
626,369
|
|
|
527,849
|
|
|
498,486
|
|
|
400,146
|
|
|
568,799
|
|
|
449,589
|
|
|
440,556
|
|
||||||||
Other income (loss), net
|
|
1,438
|
|
|
(14,313
|
)
|
|
108,711
|
|
|
(3,726
|
)
|
|
(9,718
|
)
|
|
28,234
|
|
|
93,717
|
|
|
(365
|
)
|
||||||||
Income (loss) from operations
|
|
28,065
|
|
|
(8,318
|
)
|
|
167,496
|
|
|
49,266
|
|
|
37,792
|
|
|
91,126
|
|
|
162,937
|
|
|
25,698
|
|
||||||||
Interest expense, net
|
|
(9,030
|
)
|
|
(8,141
|
)
|
|
(8,167
|
)
|
|
(8,081
|
)
|
|
(7,699
|
)
|
|
(14,705
|
)
|
|
(11,509
|
)
|
|
(10,582
|
)
|
||||||||
Income (loss) before income taxes and
noncontrolling interests |
|
19,035
|
|
|
(16,459
|
)
|
|
159,329
|
|
|
41,185
|
|
|
30,093
|
|
|
76,421
|
|
|
151,428
|
|
|
15,116
|
|
||||||||
Provision (benefit) for income taxes
|
|
4,797
|
|
|
(132
|
)
|
|
36,760
|
|
|
9,121
|
|
|
6,687
|
|
|
36,862
|
|
|
35,870
|
|
|
10,822
|
|
||||||||
Consolidated net income (loss)
|
|
14,238
|
|
|
(16,327
|
)
|
|
122,569
|
|
|
32,064
|
|
|
23,406
|
|
|
39,559
|
|
|
115,558
|
|
|
4,294
|
|
||||||||
Less: Net income (loss) attributable to
noncontrolling interests |
|
6,056
|
|
|
(5,362
|
)
|
|
33,871
|
|
|
9,396
|
|
|
6,502
|
|
|
21,800
|
|
|
47,321
|
|
|
3,555
|
|
||||||||
Net income (loss) available to
common stockholders |
|
$8,182
|
|
$(10,965)
|
|
$88,698
|
|
$22,668
|
|
$16,904
|
|
$17,759
|
|
$68,237
|
|
$739
|
(1)
|
Amounts include the gains related to the Nasdaq Earn-out associated with the Nasdaq monetization transactions recorded in Other income (loss), net.
|
•
|
These loans are guaranteed by the respective capital source and pre-sold by us prior to the commitment of any corporate funds. We take no interest rate risk on the origination and sale of these loans.
|
•
|
The pre-sold loans are funded at a 100% advance rate via bank warehouse facilities and are generally held for a period of 30-45 days prior to the consummation of a sale at an annualized carry rate of approximately 50 basis points. As of March 31, 2020, we had $1.1 billion of warehouse loan funding available through multiple banking partners.
|
•
|
We share credit losses on a pari passu basis with Fannie Mae (weighted average loss sharing is approximately 29%) on our $20.8 billion portfolio.In the event of an actual credit loss, all losses are allocated between the two parties based on the contractual loss sharing arrangement. The portfolio’s debt service coverage ratio was 2.05x as of March 31, 2020. Although we share credit losses on our Fannie Mae DUS portfolio, we view our originated servicing portfolio to be conservative in terms of relevant credit metrics such as debt service coverage, original loan-to-value and market and borrower quality.
|
•
|
Forbearance may be granted for one or more monthly payments, but no more than three months.
|
•
|
The approval of forbearance requests is delegated to us and subject to proof of property distress directly related to COVID-19. Forbearance, if granted, is a borrower event of default under the loan documents.
|
•
|
A recent MBA survey found that 2% of Freddie loans and less than 1% of Fannie loans had forbearances executed in April 2020.
|
•
|
While the forbearance rate remains difficult to predict, we would be required to advance up to $4.4 million for each 1% increase in the forbearance rate based on the CARES Act forbearance period.
|
•
|
As of April 30, 2020, we have not been required to provide any forbearance-related servicing advances.
|
•
|
Similar to other GSE business, any forbearance-related servicing advances are guaranteed by the GSEs, and as such, we expect to be able to finance such advances at or close to 100%. Currently, we are working with our bank lenders regarding a financing arrangement to provide funding for potential forbearance advances.
|
•
|
We have a contractual right to be reimbursed in full by Fannie Mae and GinnieMae for all servicer advances made during the COVID-19 forbearance program. Given our superior credit loss history and more
|
|
As of March 31, 2020
|
|
As of December 31, 2019
|
||||
6.125% Senior Notes
|
$
|
540,969
|
|
|
$
|
540,377
|
|
Credit Facility
|
411,787
|
|
|
48,917
|
|
||
Total
|
$
|
952,756
|
|
|
$
|
589,294
|
|
|
Three Months Ended March 31,
|
||||||
|
2020
|
|
2019
|
||||
Net cash provided by (used in) operating activities
|
$
|
(652,401
|
)
|
|
$
|
39,433
|
|
Add back:
|
|
|
|
||||
Loan originations - loans held for sale
|
2,545,715
|
|
|
1,554,443
|
|
||
Loan sales - loans held for sale
|
(2,057,684
|
)
|
|
(1,685,561
|
)
|
||
Unrealized gains on loans held for sale
|
36,061
|
|
|
13,276
|
|
||
Net cash provided by operating activities excluding activity from loan originations and sales (1)
|
$
|
(128,309
|
)
|
|
$
|
(78,409
|
)
|
|
|
Rating
|
|
Outlook
|
Fitch Ratings Inc.
|
|
BBB-
|
|
Stable
|
Standards & Poor's
|
|
BB+
|
|
Stable
|
Kroll Bond Rating Agency
|
|
BBB-
|
|
Stable
|
Period
|
Total
Number of Shares Repurchased/Purchased |
|
Average
Price Paid per Unit or Share |
|
Total Number of Shares Repurchased as Part of Publicly Announced Program
|
|
Approximate
Dollar Value of Units and Shares That May Yet Be Repurchased/ Purchased Under the Plan |
||||||
Balance, January 1, 2020
|
4,568,002
|
|
|
$
|
9.32
|
|
|
4,568,002
|
|
|
$
|
157,413
|
|
January 1, 2020 - March 31, 2020
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||
Total
|
4,568,002
|
|
|
$
|
—
|
|
|
4,568,002
|
|
|
$
|
157,413
|
|
|
Three Months Ended March 31, 2020
|
|
Common stock outstanding(1)
|
177,545
|
|
Partnership units(2)
|
84,491
|
|
RSUs (Treasury stock method)
|
1,370
|
|
Newmark exchange shares
|
240
|
|
Total(3)
|
263,646
|
|
(1)
|
Common stock consisted of Class A shares, Class B shares and contingent shares for which all necessary conditions have been satisfied except for the passage of time. For the year ended March 31, 2020, the weighted-average number of Class A shares was 156.1 million shares, Class B shares was 21.3 million shares and approximately 0.1 million shares of contingent Class A common stock and limited partnership units were included in our fully diluted EPS computation because the conditions for issuance had been met by the end of the period.
|
(2)
|
Partnership units collectively include founding/working partner units, limited partnership units, and Cantor units, (see Note 2 — “Limited Partnership Interests in Newmark Holdings and BGC Holdings”, to our Consolidated Financial Statements in Part II, Item 8 of this Annual Report on Form 10-Q for more information.) In general, these partnership units are potentially exchangeable into shares of Newmark Class A common stock. In addition, partnership units held by Cantor are generally exchangeable into shares of Newmark Class A common stock and/or for up to 22.8 million shares of Newmark Class B common stock. These partnership units also generally receive quarterly allocations of net income, after the deduction of the Preferred Distribution, based on their weighted-average pro rata share of economic ownership of the operating subsidiaries. As a result, these partnership units are included in the fully diluted share count calculation shown above.
|
(3)
|
For the year ended March 31, 2020, the weighted-average share count includes 0.6 million potentially anti-dilutive securities, which were excluded in the computation of fully diluted earnings per share.
|
|
Three Months Ended March 31, 2020
|
|
Common stock outstanding
|
177,987
|
|
Partnership units
|
84,260
|
|
Newmark RSUs
|
228
|
|
Newmark exchange shares
|
243
|
|
Other
|
378
|
|
Total
|
263,096
|
|
•
|
Charges with respect to grants of exchangeability, which reflect the right of holders of limited partnership units with no capital accounts, such as LPUs and PSUs, to exchange these units into shares of common stock, or into partnership units with capital accounts, such as HDUs, as well as cash paid with respect to taxes withheld or expected to be owed by the unit holder upon such exchange. The withholding taxes related to the exchange of certain non-exchangeable units without a capital account into either common shares or units with a capital account may be funded by the redemption of preferred units such as PPSUs.
|
•
|
Charges with respect to preferred units. Any preferred units would not be included in the Company's fully diluted share count because they cannot be made exchangeable into shares of common stock and are entitled only to a fixed distribution. Preferred units are granted in connection with the grant of certain limited partnership units that may be granted exchangeability or redeemed in connection with the grant of shares of common stock at ratios designed to cover any withholding taxes expected to be paid. This is an acceptable alternative to the common practice among public companies of issuing the gross amount of shares to employees, subject to cashless withholding of shares, to pay applicable withholding taxes.
|
•
|
GAAP equity-based compensation charges with respect to the grant of an offsetting amount of common stock or partnership units with capital accounts in connection with the redemption of non-exchangeable units, including PSUs and LPUs.
|
•
|
Charges related to amortization of RSUs and limited partnership units.
|
•
|
Charges related to grants of equity awards, including common stock or partnership units with capital accounts
|
•
|
Allocations of net income to limited partnership units and FPUs. Such allocations represent the pro-rata portion of post-tax GAAP earnings available to such unit holders.
|
•
|
Amortization of intangibles with respect to acquisitions. • Gains attributable to originated mortgage servicing rights (which Newmark refers to as "OMSRs").
|
•
|
Amortization of mortgage servicing rights (which Newmark refers to as "MSRs"). Under GAAP, the Company recognizes OMSRs gains equal to the fair value of servicing rights retained on mortgage loans originated and sold. Subsequent to the initial recognition at fair value, MSRs are carried at the lower of amortized cost or fair value and amortized in proportion to the net servicing Page 15 revenue expected to be earned. However, it is expected that any cash received with respect to these servicing rights, net of associated expenses, will increase Adjusted Earnings and Adjusted EBITDA in future periods.
|
•
|
Various other GAAP items that management views as not reflective of the Company's underlying performance for the given period, including non-compensation-related charges incurred as part of broad restructuring plans. Such GAAP items may include charges for exiting leases and/or other long-term contracts as part of cost-saving initiatives, as well as non-cash impairment charges related to assets, goodwill and/or intangibles created from acquisitions.
|
•
|
Unusual, one-time, non-ordinary or non-recurring gains or losses;
|
•
|
Non-cash GAAP asset impairment charges;
|
•
|
The impact of any unrealized non-cash mark-to-market gains or losses on "Other income (loss)" related to the variable share forward agreements with respect to Newmark's expected receipt of the Nasdaq payments in 2020, 2021, and 2022 and the recently settled 2019 Nasdaq payment (the "Nasdaq Forwards"); and/or
|
•
|
Mark-to-market adjustments for non-marketable investments;
|
•
|
Certain other non-cash, non-dilutive, and/or non-economic items.
|
•
|
The fully diluted share count includes the shares related to any dilutive instruments, but excludes the associated expense, net of tax, when the impact would be dilutive; or
|
•
|
The fully diluted share count excludes the shares related to these instruments, but includes the associated expense, net of tax.
|
•
|
Net income (loss) attributable to noncontrolling interest;
|
•
|
Provision (benefit) for income taxes;
|
•
|
OMSR revenue;
|
•
|
MSR amortization;
|
•
|
Other depreciation and amortization;
|
•
|
Equity-based compensation and allocations of net income to limited partnership units and FPUs;
|
•
|
Various other GAAP items that management views as not reflective of the Company’s underlying performance for the given period, including non-compensation-related charges incurred as part of broad restructuring plans. Such GAAP items may include charges for exiting leases and/or other long-term contracts as part of cost-saving initiatives, as well as non-cash impairment charges related to assets, goodwill and/or intangibles created from acquisitions.
|
•
|
Other non-cash, non-dilutive, and/or non-economic items, which may, in certain periods, include the impact of any unrealized non-cash mark-to-market gains or losses on "other income (loss)" related to the variable share forward agreements with respect to Newmark's expected receipt of the Nasdaq payments in 2020, 2021, and 2022 and the recently settled 2019 Nasdaq payment (the "Nasdaq Forwards"), as well as mark-to-market adjustments for non-marketable investments; and
|
•
|
Interest expense.
|
•
|
The underlying number of shares and the related strike price;
|
•
|
The maturity date; and
|
•
|
The implied volatility of Nasdaq’s stock price.
|
Input
|
|
Three Months Ended March 31, 2020
|
|
Three Months Ended December 31, 2019
|
|
Three Months Ended September 30, 2019
|
|
Three Months Ended June 30, 2019
|
|
Three Months Ended March 31, 2019
|
||||||||||
Number of shares per tranche
|
|
992,247
|
|
|
992,247
|
|
|
992,247
|
|
|
992,247
|
|
|
992,247
|
|
|||||
Strike price
|
|
$87.68 to $94.21
|
|
|
$87.68 to $94.21
|
|
|
$87.68 to $94.21
|
|
|
$87.68 to $94.21
|
|
|
$87.68 to $94.21
|
|
|||||
Maturity date
|
|
November 30, 2020 - November 30, 2022
|
|
November 30, 2020 - November 30, 2022
|
|
November 29, 2019 - November 30, 2022
|
|
November 29, 2019 - November 30, 2022
|
|
November 29, 2019 - November 30, 2022
|
||||||||||
Implied volatility - weighted-average
|
|
39.8
|
%
|
|
32.2
|
%
|
|
32.9
|
%
|
|
32.2
|
%
|
|
31.5
|
%
|
|||||
Period end stock price
|
|
$94.95
|
|
$107.1
|
|
$99.35
|
|
$96.17
|
|
$87.49
|
||||||||||
Dividend yield - weighted-average
|
|
1.98
|
%
|
|
1.76
|
%
|
|
1.89
|
%
|
|
1.95
|
%
|
|
2.01
|
%
|
|||||
Interest rate - weighted-average
|
|
0.52
|
%
|
|
1.70
|
%
|
|
1.62
|
%
|
|
1.82
|
%
|
|
2.35
|
%
|
|||||
Unrealized gains/(losses) due to the changes in fair value of the Nasdaq Forwards
|
|
$
|
21,173
|
|
|
$
|
(13,935
|
)
|
|
$
|
(8,214
|
)
|
|
$
|
(15,638
|
)
|
|
$
|
(13,329
|
)
|
ITEM 4.
|
CONTROLS AND PROCEDURES
|
•
|
it may limit our ability to borrow money, dispose of assets or sell equity to fund our working capital, capital expenditures, dividend payments, debt service, strategic initiatives or other obligations or purposes;
|
•
|
it may limit our flexibility in planning for, or reacting to, changes in the economy, the markets, regulatory requirements, our operations or business;
|
•
|
our financial leverage may be higher than some of our competitors, which may place us at a competitive disadvantage;
|
•
|
it may make us more vulnerable to downturns in the economy or our business;
|
•
|
it may require a substantial portion of our cash flow from operations to make interest payments;
|
•
|
it may make it more difficult for us to satisfy other obligations;
|
•
|
it may increase the risk of a future downgrade of our credit ratings or otherwise impact our ability to obtain or maintain investment grade credit ratings, which could increase the interest rates under certain of our debt agreements, increase future debt costs and limit the future availability of debt financing;
|
•
|
we may not be able to borrow additional funds or refinance existing debt as needed or take advantage of business opportunities as they arise, pay cash dividends or repurchase common stock; and
|
•
|
there would be a material adverse effect on our business, financial condition, results of operations and prospects if we were unable to service our indebtedness or obtain additional financing or refinance our existing debt on terms acceptable to us.
|
ITEM 2.
|
UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
|
ITEM 3.
|
DEFAULTS UPON SENIOR SECURITIES
|
ITEM 5.
|
OTHER INFORMATION
|
ITEM 6.
|
EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
|
Exhibit
Number |
|
Exhibit Title
|
|
|
|
10.1
|
|
|
|
|
|
31.1
|
|
|
|
|
|
31.2
|
|
|
|
|
|
32.1
|
|
|
|
|
|
101
|
|
The following materials from Newmark Group, Inc.’s Annual Report on Form 10-Q for the period ended March 31, 2020 are formatted in inline eXtensible Business Reporting Language (iXBRL): (i) the Consolidated Balance Sheets, (ii) the Consolidated Statements of Operations, (iii) the Consolidated Statements of Comprehensive Income, (iv) the Consolidated Statements of Changes in Equity, (v) the Consolidated Statements of Cash Flows (vi) Notes to the Consolidated Financial Statements, and (vii) Schedule I, Parent Company Only Financial Statements. The XBRL Instance Document does not appear in the Interactive Data File because its XBRL tags are embedded within the iXBRL document.
|
|
|
|
104
|
|
The cover page from this Annual Report on Form 10-Q, formatted in Inline XBRL.
|
|
|
|
Newmark Group, Inc.
|
|
|
|
|
/s/ Howard W. Lutnick
|
Name:
|
Howard W. Lutnick
|
Title:
|
Chairman
|
|
|
|
/s/ Michael J. Rispoli
|
Name:
|
Michael J. Rispoli
|
Title:
|
Chief Financial Officer
|
1 Year Newmark Chart |
1 Month Newmark Chart |
It looks like you are not logged in. Click the button below to log in and keep track of your recent history.
Support: +44 (0) 203 8794 460 | support@advfn.com
By accessing the services available at ADVFN you are agreeing to be bound by ADVFN's Terms & Conditions