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| Share Name | Share Symbol | Market | Type |
|---|---|---|---|
| loanDepot Inc | NYSE:LDI | NYSE | Common Stock |
| Price Change | % Change | Share Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|
| -0.059 | -2.78% | 2.061 | 2.16 | 2.06 | 2.12 | 808,263 | 23:35:00 |
From Aug 2024 to Nov 2024
Strong operational results highlighted by expanded market share and gain on sale margins; continues to invest in key growth initiatives and platforms.
Highlights:
loanDepot, Inc. (NYSE: LDI), (together with its subsidiaries, “loanDepot” or the “Company”), a leading provider of lending solutions that make the American dream of homeownership more accessible and achievable for all, today announced results for the second quarter ended June 30, 2024.
“During the second quarter, by most measures, we delivered our strongest operational results since the beginning of the market downturn that began in the first quarter of 2022,” said President and Chief Executive Officer Frank Martell. “As we near the completion of our Vision 2025 strategic plan, which was launched in July 2022, we have dramatically improved our operational results while positioning the company for long-term success. Our positive operational momentum was driven by profitable adjusted revenue growth as well as our ongoing commitment to cost discipline.
“Importantly, we continue to make critical and strategic investments in our people, products and technology platforms. We believe these investments position the company to capture the opportunities to expand market share and profitability presented by higher forecasted market volumes in 2025. This quarter, the company continued to build our in-market retail franchise, which contributed to our expanded margins and market share growth.
“In addition, we believe the company is increasingly well positioned to capitalize on the record levels of home equity available to homeowners for debt consolidation and home improvement, as well as the inevitable increase in rate and term refinance volume as mortgage interest rates are expected to decrease. At loanDepot, we believe home means everything and our expanding team of professionals delivers a complete suite of products and services that fuel the American dream.”
Added Chief Financial Officer David Hayes, “We are laser focused on our commitment to profitability and continue to work with discipline to grow revenue and manage costs. During the second quarter we successfully delivered the $120 million benefit targeted by our supplemental productivity program.
“As we approach a return to sustainable profitability, the second quarter was marked by two very significant milestones. The first is our successful tender and exchange of $500 million of corporate notes coming due in the fourth quarter of 2025. The net result of the exchange was to reduce the principal balance of our debt by $137 million and extend the maturity to 2027. As part of the debt exchange, we took advantage of strong market conditions and monetized approximately $29 billion of unpaid principal balance of our mortgage servicing rights to end the quarter with a strong balance sheet, including $533 million in cash. Second, we also reached a settlement in principle related to the class-action litigation attributable to the January cyber incident. We are presently negotiating the terms of a settlement agreement, and plaintiffs will likely submit it for court approval later in the third quarter. We believe the settlement will remove significant uncertainty for our stakeholders going forward.”
Second Quarter Highlights:
Financial Summary
Three Months Ended
Six Months Ended
($ in thousands except per share data)
(Unaudited)
Jun 30, 2024
Mar 31, 2024
Jun 30, 2023
Jun 30, 2024
Jun 30, 2023
Rate lock volume
$
8,298,270
$
6,802,330
$
8,973,666
$
15,100,600
$
17,442,101
Pull-through weighted lock volume(1)
5,782,309
4,731,836
6,057,179
10,514,145
11,382,667
Loan origination volume
6,090,634
4,558,351
6,273,543
10,648,985
11,217,880
Gain on sale margin(2)
3.06
%
2.84
%
2.75
%
2.97
%
2.61
%
Pull-through weighted gain on sale margin(3)
3.22
%
2.74
%
2.85
%
3.01
%
2.57
%
Financial Results
Total revenue
$
265,390
$
222,785
$
271,833
$
488,175
$
479,734
Total expense
342,547
307,950
330,148
650,496
644,632
Net loss
(65,853
)
(71,505
)
(49,759
)
(137,357
)
(141,480
)
Diluted loss per share
$
(0.18
)
$
(0.19
)
$
(0.13
)
$
(0.37
)
$
(0.38
)
Non-GAAP Financial Measures(4)
Adjusted total revenue
$
278,007
$
230,816
$
268,736
$
508,820
$
494,735
Adjusted net loss
(15,890
)
(39,499
)
(36,120
)
(55,384
)
(95,043
)
Adjusted EBITDA
34,575
503
4,070
35,078
(23,411
)
(1)
Pull-through weighted rate lock volume is the principal balance of loans subject to interest rate lock commitments, net of a pull-through factor for the loan funding probability.
(2)
Gain on sale margin represents the total of (i) gain on origination and sale of loans, net, and (ii) origination income, net, divided by loan origination volume during period.
(3)
Pull-through weighted gain on sale margin represents the total of (i) gain on origination and sale of loans, net, and (ii) origination income, net, divided by the pull-through weighted rate lock volume.
(4)
See “Non-GAAP Financial Measures” for a discussion of Non-GAAP Financial Measures and a reconciliation of these metrics to their closest GAAP measure.
Year-over-Year Operational Highlights
Outlook for the third quarter of 2024
Servicing
Three Months Ended
Six Months Ended
Servicing Revenue Data:
($ in thousands)
(Unaudited)
Jun 30, 2024
Mar 31, 2024
Jun 30, 2023
Jun 30, 2024
Jun 30, 2023
Due to collection/realization of cash flows
$
(42,285
)
$
(35,999
)
$
(41,619
)
$
(78,285
)
$
(76,276
)
Due to changes in valuation inputs or assumptions
15,623
28,244
26,138
43,867
4,771
Realized (loss) gain on sale of servicing rights
(3,057
)
44
6,973
(3,013
)
7,164
Net loss from derivatives hedging servicing rights
(25,183
)
(36,319
)
(30,014
)
(61,499
)
(26,936
)
Change in fair value of servicing rights, net of hedging gains and losses
(12,617
)
(8,031
)
3,097
(20,645
)
(15,001
)
Other realized (losses) gains on sales of servicing rights (1)
(5,885
)
(1,240
)
48
(7,126
)
(3
)
Changes in fair value of servicing rights, net
$
(60,787
)
$
(45,270
)
$
(38,474
)
$
(106,056
)
$
(91,280
)
Servicing fee income (2)
$
125,082
$
124,059
$
119,529
$
249,140
$
239,418
(1)
Includes the (provision) recovery for sold MSRs and broker fees.
(2)
Servicing fee income for the three months ended June 30, 2023, has been adjusted to incorporate earnings credits, which were previously classified as part of net interest income.
____________________________1 We define organic refinance consumer direct recapture rate as the total unpaid principal balance (“UPB”) of loans in our servicing portfolio that are paid in full for purposes of refinancing the loan on the same property, with the Company acting as lender on both the existing and new loan, divided by the UPB of all loans in our servicing portfolio that paid in full for the purpose of refinancing the loan on the same property. The recapture rate is finalized following the publication date of this release when external data becomes available.
Three Months Ended
Six Months Ended
Servicing Rights, at Fair Value:
($ in thousands)
(Unaudited)
Jun 30, 2024
Mar 31, 2024
Jun 30, 2023
Jun 30, 2024
Jun 30, 2023
Balance at beginning of period
$
1,970,164
$
1,985,718
$
2,016,568
$
1,985,718
$
2,025,136
Additions
66,115
48,375
75,866
114,491
135,161
Sales proceeds
(439,199
)
(56,113
)
(85,164
)
(495,312
)
(97,194
)
Changes in fair value:
Due to changes in valuation inputs or assumptions
15,623
28,244
26,138
43,867
4,771
Due to collection/realization of cash flows
(42,285
)
(35,999
)
(41,619
)
(78,285
)
(76,276
)
Realized (losses) gains on sales of servicing rights
(3,955
)
(61
)
6,973
(4,016
)
7,164
Total changes in fair value
(30,617
)
(7,816
)
(8,508
)
(38,434
)
(64,341
)
Balance at end of period (1)
$
1,566,463
$
1,970,164
$
1,998,762
$
1,566,463
$
1,998,762
(1)
Balances are net of $16.7 million, $15.8 million, and $13.3 million of servicing rights liability as of June 30, 2024, March 31, 2024, and June 30, 2023, respectively.
% Change
Servicing Portfolio Data:
($ in thousands)
(Unaudited)
Jun 30, 2024
Mar 31, 2024
Jun 30, 2023
Jun-24
vs
Mar-24
Jun-24 vs Jun-23
Servicing portfolio (unpaid principal balance)
$
114,278,549
$
142,337,251
$
142,479,870
(19.7
)%
(19.8
)%
Total servicing portfolio (units)
403,302
491,871
482,266
(18.0
)
(16.4
)
60+ days delinquent ($)
$
1,457,098
$
1,445,489
$
1,192,377
0.8
22.2
60+ days delinquent (%)
1.3
%
1.0
%
0.8
%
Servicing rights, net to UPB
1.4
%
1.4
%
1.4
%
Balance Sheet Highlights
% Change
($ in thousands)
(Unaudited)
Jun 30, 2024
Mar 31, 2024
Jun 30, 2023
Jun-24 vs Mar-24
Jun-24 vs Jun-23
Cash and cash equivalents
$
533,153
$
603,663
$
719,073
(11.7
)%
(25.9
)%
Loans held for sale, at fair value
2,377,987
2,300,058
2,256,551
3.4
5.4
Loans held for investment, at fair value
120,287
—
—
NM
NM
Servicing rights, at fair value
1,583,128
1,985,948
2,012,049
(20.3
)
(21.3
)
Total assets
5,942,777
6,193,270
6,203,504
(4.0
)
(4.2
)
Warehouse and other lines of credit
2,213,128
2,069,619
2,046,208
6.9
8.2
Total liabilities
5,363,839
5,555,928
5,406,160
(3.5
)
(0.8
)
Total equity
578,938
637,342
797,344
(9.2
)
(27.4
)
An increase in loans held for sale at June 30, 2024, resulted in a corresponding increase in the balance on our warehouse lines of credit. Total funding capacity with our lending partners was $3.1 billion at June 30, 2024, and $3.9 billion at June 30, 2023. Available borrowing capacity was $0.8 billion at June 30, 2024.
Consolidated Statements of Operations
($ in thousands except per share data)
Three Months Ended
Six Months Ended
Jun 30, 2024
Mar 31, 2024
Jun 30, 2023
Jun 30, 2024
Jun 30, 2023
(Unaudited)
(Unaudited)
REVENUES:
Interest income
$
35,052
$
30,925
$
33,060
$
65,977
$
61,017
Interest expense
(35,683
)
(31,666
)
(32,001
)
(67,349
)
(59,689
)
Net interest (expense) income
(631
)
(741
)
1,059
(1,372
)
1,328
Gain on origination and sale of loans, net
166,920
116,060
154,335
282,981
262,487
Origination income, net
19,494
13,606
18,332
33,099
30,349
Servicing fee income
125,082
124,059
119,529
249,140
239,418
Change in fair value of servicing rights, net
(60,787
)
(45,270
)
(38,474
)
(106,056
)
(91,280
)
Other income
15,312
15,071
17,052
30,383
37,432
Total net revenues
265,390
222,785
271,833
488,175
479,734
EXPENSES:
Personnel expense
141,036
134,318
157,799
275,354
298,826
Marketing and advertising expense
31,175
28,354
34,712
59,529
70,626
Direct origination expense
21,550
18,171
17,224
39,721
34,603
General and administrative expense
73,160
57,746
54,817
130,905
110,951
Occupancy expense
5,204
5,110
6,099
10,314
12,180
Depreciation and amortization
8,955
9,443
10,721
18,398
20,747
Servicing expense
8,467
8,261
5,750
16,728
10,583
Other interest expense
53,000
46,547
43,026
99,547
86,116
Total expenses
342,547
307,950
330,148
650,496
644,632
Loss before income taxes
(77,157
)
(85,165
)
(58,315
)
(162,321
)
(164,898
)
Income tax benefit
(11,304
)
(13,660
)
(8,556
)
(24,964
)
(23,418
)
Net loss
(65,853
)
(71,505
)
(49,759
)
(137,357
)
(141,480
)
Net loss attributable to noncontrolling interests
(33,642
)
(37,250
)
(26,316
)
(70,891
)
(75,130
)
Net loss attributable to loanDepot, Inc.
$
(32,211
)
$
(34,255
)
$
(23,443
)
$
(66,466
)
$
(66,350
)
Basic loss per share
$
(0.18
)
$
(0.19
)
$
(0.13
)
$
(0.37
)
$
(0.38
)
Diluted loss per share
$
(0.18
)
$
(0.19
)
$
(0.13
)
$
(0.37
)
$
(0.38
)
Weighted average shares outstanding
Basic
182,324,046
181,407,353
173,908,030
181,863,195
172,358,924
Diluted
182,324,046
324,679,090
173,908,030
181,863,195
172,358,924
Consolidated Balance Sheets
($ in thousands)
Jun 30, 2024
Mar 31, 2024
Dec 31, 2023
(Unaudited)
ASSETS
Cash and cash equivalents
$
533,153
$
603,663
$
660,707
Restricted cash
98,057
74,346
85,149
Loans held for sale, at fair value
2,377,987
2,300,058
2,132,880
Loans held for investment, at fair value
120,287
—
—
Derivative assets, at fair value
59,779
64,055
93,574
Servicing rights, at fair value
1,583,128
1,985,948
1,999,763
Trading securities, at fair value
89,477
91,545
92,901
Property and equipment, net
64,631
66,160
70,809
Operating lease right-of-use asset
24,549
27,409
29,433
Loans eligible for repurchase
740,238
748,476
711,371
Investments in joint ventures
17,905
17,849
20,363
Other assets
233,586
213,761
254,098
Total assets
$
5,942,777
$
6,193,270
$
6,151,048
LIABILITIES AND EQUITY
LIABILITIES:
Warehouse and other lines of credit
$
2,213,128
$
2,069,619
$
1,947,057
Accounts payable and accrued expenses
375,319
367,457
379,971
Derivative liabilities, at fair value
17,856
11,233
84,962
Liability for loans eligible for repurchase
740,238
748,476
711,371
Operating lease liability
41,896
45,324
49,192
Debt obligations, net
1,975,402
2,313,819
2,274,011
Total liabilities
5,363,839
5,555,928
5,446,564
EQUITY:
Total equity
578,938
637,342
704,484
Total liabilities and equity
$
5,942,777
$
6,193,270
$
6,151,048
Loan Origination and Sales Data
($ in thousands)
(Unaudited)
Three Months Ended
Six Months Ended
Jun 30, 2024
Mar 31, 2024
Jun 30, 2023
Jun 30, 2024
Jun 30, 2023
Loan origination volume by type:
Conventional conforming
$
3,311,617
$
2,545,203
$
3,323,678
$
5,856,820
$
6,217,499
FHA/VA/USDA
2,271,104
1,654,025
2,337,946
3,925,129
4,016,537
Jumbo
150,666
75,794
148,077
226,460
279,143
Other
357,247
283,329
463,842
640,576
704,701
Total
$
6,090,634
$
4,558,351
$
6,273,543
$
10,648,985
$
11,217,880
Loan origination volume by purpose:
Purchase
$
4,383,145
$
3,296,273
$
4,552,919
$
7,679,418
$
8,065,690
Refinance - cash out
1,562,827
1,143,682
1,614,747
2,706,509
2,938,986
Refinance - rate/term
144,662
118,396
105,877
263,058
213,204
Total
$
6,090,634
$
4,558,351
$
6,273,543
$
10,648,985
$
11,217,880
Loans sold:
Servicing retained
$
4,011,399
$
2,986,541
$
3,943,845
$
6,997,940
$
7,221,552
Servicing released
1,893,515
1,452,812
2,134,024
3,346,327
4,252,898
Total
$
5,904,914
$
4,439,353
$
6,077,869
$
10,344,267
$
11,474,450
Second Quarter Earnings Call
Management will host a conference call and live webcast today at 5:00 p.m. ET on loanDepot’s Investor Relations website, investors.loandepot.com, to discuss the Company’s earnings results.
The conference call can also be accessed by dialing (800) 715-9871, Conference ID: 9881136. Please call five minutes in advance to ensure that you are connected prior to the call. A webcast can also be accessed at https://events.q4inc.com/attendee/410319294.
A replay of the webcast will be made available on the Investor Relations website following the conclusion of the event.
For more information about loanDepot, please visit the company’s Investor Relations website: investors.loandepot.com.
Non-GAAP Financial Measures
To provide investors with information in addition to our results as determined by GAAP, we disclose certain non-GAAP measures to assist investors in evaluating our financial results. We believe these non-GAAP measures provide useful information to investors regarding our results of operations because each measure assists both investors and management in analyzing and benchmarking the performance and value of our business. They facilitate company-to-company operating performance comparisons by backing out potential differences caused by variations in hedging strategies, changes in valuations, capital structures (affecting interest expense on non-funding debt), taxation, the age and book depreciation of facilities (affecting relative depreciation expense), and other cost or benefit items which may vary for different companies for reasons unrelated to operating performance. These non-GAAP measures include our Adjusted Total Revenue, Adjusted Net Income (Loss), Adjusted Diluted Earnings (Loss) Per Share (if dilutive), and Adjusted EBITDA (LBITDA). We exclude from these non-GAAP financial measures the change in fair value of MSRs, gains (losses) from the sale of MSRs and related hedging gains and losses that represent realized and unrealized adjustments resulting from changes in valuation, mostly due to changes in market interest rates, and are not indicative of the Company’s operating performance or results of operation. Beginning in the second quarter of 2024, we began to include the gains (losses) from the sale of MSRs in valuation changes in servicing rights, net of hedging gains and losses to appropriately capture all valuation changes in MSRs up to and including the sales date. Prior periods have been revised to conform with this new presentation. We also exclude stock-based compensation expense, which is a non-cash expense, expenses directly related to the Cybersecurity Incident, net of expected insurance recoveries, including costs to investigate and remediate the Cybersecurity Incident, the costs of customer notifications and identity protection, professional fees, including legal expenses, litigation settlement costs, and commission guarantees, gains or losses on extinguishment of debt and disposal of fixed assets, non-cash goodwill impairment, and other impairment charges to intangible assets and operating lease right-of-use assets, as well as certain costs associated with our restructuring efforts, as management does not consider these costs to be indicative of our performance or results of operations. Adjusted EBITDA (LBITDA) includes interest expense on funding facilities, which are recorded as a component of “net interest income (expense),” as these expenses are a direct operating expense driven by loan origination volume. By contrast, interest expense on our non-funding debt is a function of our capital structure and is therefore excluded from Adjusted EBITDA (LBITDA). Adjustments for income taxes are made to reflect historical results of operations on the basis that it was taxed as a corporation under the Internal Revenue Code, and therefore subject to U.S. federal, state and local income taxes. Adjustments to Diluted Weighted Average Shares Outstanding assumes the pro forma conversion of weighted average Class C shares to Class A common stock. These non-GAAP measures have limitations as analytical tools and should not be considered in isolation or as a substitute for revenue, net income, or any other operating performance measure calculated in accordance with GAAP, and may not be comparable to a similarly titled measure reported by other companies. Some of these limitations are:
Because of these limitations, Adjusted Total Revenue, Adjusted Net Income (Loss), Adjusted Diluted Earnings (Loss) Per Share, and Adjusted EBITDA (LBITDA) are not intended as alternatives to total revenue, net income (loss), net income (loss) attributable to the Company, or Diluted Earnings (Loss) Per Share or as an indicator of our operating performance and should not be considered as measures of discretionary cash available to us to invest in the growth of our business or as measures of cash that will be available to us to meet our obligations. We compensate for these limitations by using Adjusted Total Revenue, Adjusted Net Income (Loss), Adjusted Diluted Earnings (Loss) Per Share, and Adjusted EBITDA (LBITDA) along with other comparative tools, together with U.S. GAAP measurements, to assist in the evaluation of operating performance. See below for a reconciliation of these non-GAAP measures to their most comparable U.S. GAAP measures.
Reconciliation of Total Revenue to Adjusted Total Revenue
($ in thousands)
(Unaudited)
Three Months Ended
Six Months Ended
Jun 30, 2024
Mar 31, 2024
Jun 30, 2023
Jun 30, 2024
Jun 30, 2023
Total net revenue
$
265,390
$
222,785
$
271,833
$
488,175
$
479,734
Valuation changes in servicing rights, net of hedging gains and losses(1)
12,617
8,031
(3,097
)
20,645
15,001
Adjusted total revenue
$
278,007
$
230,816
$
268,736
$
508,820
$
494,735
(1)
Represents the change in the fair value of servicing rights due to changes in valuation inputs or assumptions, net of gains or losses from derivatives hedging servicing rights. Beginning in the second quarter of 2024, we began to include the gains (losses) from the sale of MSRs in valuation changes in servicing rights, net of hedging gains and losses to appropriately capture all valuation changes in MSRs up to and including the sales date. Prior periods have been revised to conform with this new presentation.
Reconciliation of Net Income (Loss) to Adjusted Net Income (Loss)
($ in thousands)
(Unaudited)
Three Months Ended
Six Months Ended
Jun 30, 2024
Mar 31, 2024
Jun 30, 2023
Jun 30, 2024
Jun 30, 2023
Net loss attributable to loanDepot, Inc.
$
(32,211
)
$
(34,255
)
$
(23,443
)
$
(66,466
)
$
(66,350
)
Net loss from the pro forma conversion of Class C common shares to Class A common stock (1)
(33,642
)
(37,250
)
(26,316
)
(70,891
)
(75,130
)
Net loss
(65,853
)
(71,505
)
(49,759
)
(137,357
)
(141,480
)
Adjustments to the benefit for income taxes(2)
8,838
9,774
6,916
18,616
20,120
Tax-effected net loss
(57,015
)
(61,731
)
(42,843
)
(118,741
)
(121,360
)
Valuation changes in servicing rights, net of hedging gains and losses(3)
12,617
8,031
(3,097
)
20,645
15,001
Stock-based compensation expense
5,898
4,855
5,754
10,753
11,679
Restructuring charges(4)
3,127
2,124
4,544
5,252
6,591
Cybersecurity incident(5)
26,942
14,698
—
41,640
—
Loss (gain) on extinguishment of debt
5,680
—
(39
)
5,680
(39
)
Loss (gain) on disposal of fixed assets
—
(29
)
751
(28
)
1,012
Other (recovery) impairment(6)
1,193
(1
)
686
1,192
341
Tax effect of adjustments(7)
(14,332
)
(7,446
)
(1,876
)
(21,777
)
(8,268
)
Adjusted net loss
$
(15,890
)
$
(39,499
)
$
(36,120
)
$
(55,384
)
$
(95,043
)
(1)
Reflects net loss to Class A common stock and Class D common stock from the pro forma exchange of Class C common stock.
(2)
loanDepot, Inc. is subject to federal, state and local income taxes. Adjustments to the income tax benefit reflect the income tax rates below, and the pro forma assumption that loanDepot, Inc. owns 100% of LD Holdings.
Three Months Ended
Six Months Ended
Jun 30, 2024
Mar 31, 2024
Jun 30, 2023
Jun 30, 2024
Jun 30, 2023
Statutory U.S. federal income tax rate
21.00
%
21.00
%
21.00
%
21.00
%
21.00
%
State and local income taxes (net of federal benefit)
5.27
%
5.24
%
5.28
%
5.26
%
5.78
%
Effective income tax rate
26.27
%
26.24
%
26.28
%
26.26
%
26.78
%
(3)
Represents the change in the fair value of servicing rights due to changes in valuation inputs or assumptions, net of gains or losses from derivatives hedging servicing rights, and gains (losses) from the sale of MSRs. Beginning in the second quarter of 2024, we began to include the gains (losses) from the sale of MSRs in valuation changes in servicing rights, net of hedging gains and losses to appropriately capture all valuation changes in MSRs up to and including the sales date. Prior periods have been revised to conform with this new presentation.
(4)
Reflects employee severance expense and professional services associated with restructuring efforts subsequent to the announcement of Vision 2025 in July 2022.
(5)
Represents expenses directly related to the Cybersecurity Incident, net of expected insurance recoveries, including costs to investigate and remediate the Cybersecurity Incident, the costs of customer notifications and identity protection, professional fees including legal expenses, litigation settlement costs, and commission guarantees. During the quarter ended June 30, 2024, the Company recorded an accrual of $25 million in connection with class action litigation related to the Cybersecurity Incident.
(6)
Represents lease impairment on corporate and retail locations.
(7)
Amounts represent the income tax effect using the aforementioned effective income tax rates, excluding certain discrete tax items.
Reconciliation of Adjusted Diluted Weighted Average Shares Outstanding to Diluted Weighted Average Shares Outstanding
($ in thousands except per share data)
(Unaudited)
Three Months Ended
Six Months Ended
Jun 30, 2024
Mar 31, 2024
Jun 30, 2023
Jun 30, 2024
Jun 30, 2023
Net loss attributable to loanDepot, Inc.
$
(32,211
)
$
(34,255
)
$
(23,443
)
$
(66,466
)
$
(66,350
)
Adjusted net loss
(15,890
)
(39,499
)
(36,120
)
(55,384
)
(95,043
)
Share Data:
Diluted weighted average shares of Class A and Class D common stock outstanding
182,324,046
324,679,090
173,908,030
181,863,195
172,358,924
Assumed pro forma conversion of weighted average Class C shares to Class A common stock (1)
142,803,534
—
148,597,745
142,863,473
149,535,576
Adjusted diluted weighted average shares outstanding
325,127,580
324,679,090
322,505,775
324,726,668
321,894,500
(1)
Reflects the assumed pro forma exchange and conversion of anti-dilutive Class C common shares.
Reconciliation of Net Income (Loss) to Adjusted EBITDA (LBITDA)
($ in thousands)
(Unaudited)
Three Months Ended
Six Months Ended
Jun 30, 2024
Mar 31, 2024
Jun 30, 2023
Jun 30, 2024
Jun 30, 2023
Net loss
$
(65,853
)
$
(71,505
)
$
(49,759
)
$
(137,357
)
$
(141,480
)
Interest expense - non-funding debt (1)
53,000
46,547
43,026
99,547
86,116
Income tax benefit
(11,304
)
(13,660
)
(8,556
)
(24,964
)
(23,418
)
Depreciation and amortization
8,955
9,443
10,721
18,398
20,747
Valuation changes in servicing rights, net of hedging gains and losses(2)
12,617
8,031
(3,097
)
20,645
15,001
Stock-based compensation expense
5,898
4,855
5,754
10,753
11,679
Restructuring charges(3)
3,127
2,124
4,544
5,252
6,591
Cybersecurity incident(4)
26,942
14,698
—
41,640
—
Loss (gain) on disposal of fixed assets
—
(29
)
751
(28
)
1,012
Other (recovery) impairment
1,193
(1
)
686
1,192
341
Adjusted EBITDA (LBITDA)
$
34,575
$
503
$
4,070
$
35,078
$
(23,411
)
(1)
Represents other interest expense, which includes gain or loss on extinguishment of debt and amortization of debt issuance costs, in the Company’s consolidated statements of operations.
(2)
Represents the change in the fair value of servicing rights due to changes in valuation inputs or assumptions, net of gains or losses from derivatives hedging servicing rights, and gains (losses) from the sale of MSRs. Beginning in the second quarter of 2024, we began to include the gains (losses) from the sale of MSRs in valuation changes in servicing rights, net of hedging gains and losses to appropriately capture all valuation changes in MSRs up to and including the sales date. Prior periods have been revised to conform with this new presentation.
(3)
Reflects employee severance expense and professional services associated with restructuring efforts subsequent to the announcement of Vision 2025 in July 2022.
(4)
Represents expenses, directly related to the Cybersecurity Incident, net of expected insurance recoveries, that occurred in the first quarter of 2024, including costs to investigate and remediate the Cybersecurity Incident, the costs of customer notifications and identity protection, professional fees including legal expenses, litigation settlement costs, and commission guarantees. During the quarter ended June 30, 2024, the Company recorded an accrual of $25 million in connection with class action litigation related to the Cybersecurity Incident.
Forward-Looking Statements
This press release may contain "forward-looking statements," which reflect loanDepot's current views with respect to, among other things, our business strategies, including the Vision 2025 plan, including our expanded productivity program, our progress toward run-rate profitability, our HELOC product, financial condition and liquidity, competitive position, industry and regulatory environment, potential growth opportunities, the effects of competition, the impact of the Cybersecurity Incident, operations and financial performance. These forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts and may contain the words “outlook,” “potential,” “believe,” “anticipate,” “expect,” “intend,” “plan,” “predict,” “estimate,” “project,” “will be,” “will continue,” “will likely result,” or other similar words and phrases or future or conditional verbs such as “will,” “may,” “might,” “should,” “would,” or “could” and the negatives of those terms. These forward-looking statements are based on current available operating, financial, economic and other information, and are not guarantees of future performance and are subject to risks, uncertainties and assumptions, including but not limited to, the following: our ability to achieve the expected benefits of our Vision 2025 plan and the success of our cost-reduction initiatives, such as the expanded productivity program; our ability to achieve run-rate profitability; our loan production volume; our ability to maintain an operating platform and management system sufficient to conduct our business; our ability to maintain warehouse lines of credit and other sources of capital and liquidity; impacts of cybersecurity incidents, cyberattacks, information or security breaches and technology disruptions or failures, of ours or of our third party vendors; the outcome of legal proceedings to which we are a party; our ability to reach a definitive settlement agreement related to the Cybersecurity Incident; adverse changes in macroeconomic and U.S residential real estate and mortgage market conditions, including increases in interest rate levels; changing federal, state and local laws, as well as changing regulatory enforcement policies and priorities; and other risks detailed in the "Risk Factors" section of loanDepot, Inc.'s Annual Report on Form 10-K for the year ended December 31, 2023 and Quarterly Reports on Form 10-Q as well as any subsequent filings with the Securities and Exchange Commission, which are difficult to predict. Therefore, current plans, anticipated actions, financial results, as well as the anticipated development of the industry, may differ materially from what is expressed or forecasted in any forward-looking statement. loanDepot does not undertake any obligation to publicly update or revise any forward-looking statement to reflect future events or circumstances, except as required by applicable law.
About loanDepot
loanDepot (NYSE: LDI) is a leading provider of lending solutions that make the American dream of homeownership more accessible and achievable for all, especially the increasingly diverse communities of first-time homebuyers, through a broad suite of lending and real estate services that simplify one of life's most complex transactions. Since its launch in 2010, the company has been recognized as an innovator, using its industry-leading technology to deliver a superior customer experience. Our digital-first approach makes it easier, faster and less stressful to purchase or refinance a home. Today, as one of the largest non-bank lenders in the country, loanDepot and its mellohome operating unit offer an integrated platform of lending, loan servicing, real estate and home services that support customers along their entire homeownership journey. Headquartered in Southern California and with hundreds of local market offices nationwide, loanDepot’s passionate team is dedicated to making a positive difference in the lives of their customers every day.
LDI-IR
View source version on businesswire.com: https://www.businesswire.com/news/home/20240806117619/en/
Investor Relations Contact: Gerhard Erdelji Senior Vice President, Investor Relations (949) 822-4074 gerdelji@loandepot.com
Media Contact: Rebecca Anderson Senior Vice President, Communications & Public Relations (949) 822-4024 rebeccaanderson@loandepot.com
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