Finance of America Reports Second Quarter 2021 Results
– Total revenue of $389 million on Funded Volume of $8.3 billion during the second quarter –
– Net loss for the quarter of $15 million or $(0.05) per diluted share –
– Adjusted Net Income* of $57 million or $0.30 per diluted share –
IRVING, Texas–(BUSINESS WIRE)–Finance of America Companies Inc., (“Finance of America” or the “Company”) (NYSE: FOA), a diversified, vertically integrated consumer lending platform, reported financial results for the quarter ended June 30, 2021.
Second Quarter 2021 Financial Highlights
- Completed the business combination with Replay Acquisition Corp. on April 1, 2021 (the “Business Combination”)
- Total revenues were $389 million compared to $465 million in the second quarter of 2020 and $508 million in the prior quarter
- Year to date, the company has shown substantial growth in revenue across all business segments compared to the first six months of 2020
- Net loss totaled $15 million, or $(0.05) Diluted EPS on an if-converted basis, compared to net income of $146 million, or $0.78 per share on an if-converted basis, in the second quarter of 2020 and $124 million, or $0.63 per share on an if-converted basis, in the prior quarter
- Adjusted Net Income* totaled $57 million compared to adjusted net income of $110 million in the second quarter of 2020 and $107 million in the prior quarter
- Adjusted EBITDA* totaled $87 million compared to $153 million in the second quarter of 2020 and $154 million in the prior quarter
- Adjusted diluted earnings per share* of $0.30 compared to $0.58 in the second quarter of 2020 and $0.56 in the prior quarter
- Book equity of $2,379 million or $12.44 per diluted share
*See the sections titled “Reconciliation to GAAP” and “Non-GAAP Financial Measures” below for reconciliations to the most directly comparable GAAP measures and other important disclosures.
“Second quarter results demonstrated the power of Finance of America’s diversified platform,” stated Patricia Cook, Chief Executive Officer. “While the broader industry trends led to lower mortgage origination volumes and reduced gain on sale margins, continued strength across our other businesses partially offset the impact of mortgage revenue declines. Our diversified consumer lending platform that spans mortgages, reverse mortgages and commercial loans distributed across retail, third-party brokers, and digital direct-to-consumer channels remains a key differentiator. In addition, our Lender Services business continued to contribute significant levels of fee income despite the slowdown in mortgage volumes.
“Our market leading Reverse Originations segment generated strong growth in earnings contribution in the second quarter. Importantly, the Reverse business is less correlated to the direction of interest rates than the forward mortgage market, and we believe the segment is well positioned to generate strong and sustainable growth. Baby boomers are increasingly looking to age in place, and our reverse mortgage products enable this demographic to tap into the equity accumulated in their homes to fund or supplement their retirement savings.
“Our broad suite of products and multiple channels continues to drive revenue and earnings. As a public company, we remain focused on creating shareholder value in everything we do.”
Second Quarter Financial Summary
|
($ amounts in millions, except |
|
|
|
Variance |
|
|
|
Variance |
|
|
|
|
|
Variance |
|||||||||||||
|
|
|
Q2’21 |
|
Q1’21 |
|
Q2’21 vs |
|
Q2’20 |
|
Q2’21 vs |
|
YTD 2021 |
|
YTD 2020 |
|
2021 vs |
|||||||||||
|
|
|
Successor |
|
Predecessor |
|
|
|
Predecessor |
|
|
|
Combined(1) |
|
Predecessor |
|
|
|||||||||||
|
Funded volume |
|
$ |
8,342 |
|
|
$ |
9,514 |
|
|
(12)% |
|
$ |
8,353 |
|
|
— |
% |
|
17,856 |
|
|
13,686 |
|
|
30% |
||
|
Net rate lock volume(2) |
|
6,669 |
|
|
8,405 |
|
|
(21)% |
|
6,802 |
|
|
(2) |
% |
|
15,074 |
|
13,017 |
|
16% |
|||||||
|
Total revenue |
|
389 |
|
|
508 |
|
|
(23)% |
|
465 |
|
|
(16) |
% |
|
897 |
|
|
654 |
|
|
37% |
|||||
|
Total expenses and |
|
403 |
|
|
382 |
|
|
5% |
|
319 |
|
|
26 |
% |
|
785 |
|
|
549 |
|
|
43% |
|||||
|
Pre-tax (loss) income |
|
(14) |
|
|
125 |
|
|
(111)% |
|
146 |
|
|
110 |
% |
|
112 |
|
|
105 |
|
|
7% |
|||||
|
Net (loss) income |
|
(15) |
|
|
124 |
|
|
(112)% |
|
146 |
|
|
110 |
% |
|
109 |
|
|
104 |
|
|
5% |
|||||
|
Adjusted net income(3) |
|
57 |
|
|
107 |
|
|
(47)% |
|
110 |
|
|
48 |
% |
|
164 |
|
|
134 |
|
|
22% |
|||||
|
Adjusted EBITDA(3) |
|
87 |
|
|
154 |
|
|
(44)% |
|
153 |
|
|
(43) |
% |
|
241 |
|
|
188 |
|
|
28% |
|||||
|
Mortgage |
|
2.78 |
% |
|
3.40 |
% |
|
(18)% |
|
4.39 |
% |
|
(37) |
% |
|
3.13 |
% |
|
3.27 |
% |
|
(4)% |
|||||
|
Basic earnings per share |
|
$ |
0.04 |
|
|
n/a |
|
n/a |
|
n/a |
|
n/a |
|
n/a |
|
n/a |
|
n/a |
|||||||||
|
Diluted earnings per share |
|
$ |
(0.05) |
|
|
$ |
0.63 |
|
|
(108)% |
|
$ |
0.78 |
|
|
(106) |
% |
|
$ |
0.58 |
|
|
$ |
0.63 |
|
|
(8)% |
|
Adjusted diluted |
|
$ |
0.30 |
|
|
$ |
0.56 |
|
|
(46)% |
|
$ |
0.58 |
|
|
(48) |
% |
|
$ |
0.86 |
|
|
$ |
0.70 |
|
|
23% |
| (1) Financial results of combined successor and predecessor of the business combination with Replay. |
| (2) Net rate lock volume relates only to the Mortgage Originations segment. |
| (3) See Reconciliation to GAAP section for a reconciliation of Adjusted Net Income and Adjusted EBITDA to Net (loss) income. |
| (4) Calculated for each period as gain on sale and other income from mortgage loans held for sale, net, divided by net rate lock volume. |
| (5) Calculated on an if-converted basis. See Reconciliation to GAAP section for more detail. |
Discussion of Second Quarter 2021 Results:
- Generated funded volume of $8,342 million and net rate lock volume of $6,669 million.
- Total revenue declined $119 million or 23% quarter over quarter predominantly as a result of lower revenue in the Mortgage Originations segment.
- Net loss totaled $15 million resulting from $20 million of fair value adjustments in the Portfolio Management segment and $43 million of non-recurring expenses related to the Business Combination.
- Adjusted net income totaled $57 million and Adjusted diluted earnings per share of $0.30. See Non-GAAP reconciliation for more detail.
Balance Sheet Highlights ($ amounts in millions)
|
|
|
June 30, |
|
December 31, |
|
Variance (%) |
||||
|
|
|
2021 |
|
2020 |
|
|||||
|
|
|
Successor |
|
Predecessor |
|
|
||||
|
Cash and cash equivalents |
|
$ |
157 |
|
|
$ |
233 |
|
|
(33)% |
|
Goodwill |
|
1,298 |
|
|
121 |
|
|
973% |
||
|
Intangible assets |
|
704 |
|
|
17 |
|
|
4041% |
||
|
Total assets |
|
22,228 |
|
|
19,565 |
|
|
14% |
||
|
Total liabilities |
|
19,849 |
|
|
18,771 |
|
|
6% |
||
|
Equity including CRNCI |
|
2,379 |
|
|
794 |
|
|
200% |
||
- Cash and cash equivalents excluding restricted cash ended the second quarter at $157 million. Since year-end, cash has been deployed to redeem the prior noncontrolling interests in Finance of America Commercial LLC, to grow originated mortgage servicing rights (MSR), and to fund the purchase consideration of previously announced acquisitions.
- Total assets grew $2,663 million in the first half of 2021 primarily as a result of the growth in our securitized and unsecuritized loans held for investment of $910 million combined with an increase in Goodwill and Intangible assets totaling $1,864 million as a result of the application of purchase accounting related to the Business Combination.
- Total liabilities grew $1,078 million primarily due to an increase in warehouse and MSR financing of $972 million.
- MSR grew by $110 million during the first half of 2021.
- Equity increased $1,585 million in the first half of 2021 primarily as a result of the application of purchase accounting related to the Business Combination. In addition, the company redeemed the outstanding Class B shares in its Finance of America Commercial LLC subsidiary, which formerly was classified as Contingently Redeemable Noncontrolling Interest.
Segment Results
Mortgage Originations
The Mortgage Originations segment generates revenue through fee income from loan originations and gain on sale of mortgage loans into the secondary market.
|
($ amounts in millions) |
|
|
|
Variance |
|
|
|
Variance |
|
|
|
|
|
Variance |
|||||||||||
|
|
|
Q2’21 |
|
Q1’21 |
|
Q2’21 vs |
|
Q2’20 |
|
Q2’21 vs |
|
YTD 2021 |
|
YTD 2020 |
|
2021 vs |
|||||||||
|
|
|
Successor |
|
Predecessor |
|
|
|
Predecessor |
|
|
|
Combined (1) |
|
Predecessor |
|
|
|||||||||
|
Funded volume |
|
$ |
6,929 |
|
|
$ |
8,404 |
|
|
(18)% |
|
$ |
7,582 |
|
|
(9)% |
|
$ |
15,333 |
|
|
$ |
11,802 |
|
30% |
|
Net rate lock volume |
|
6,669 |
|
|
8,405 |
|
|
(21)% |
|
6,802 |
|
|
(2)% |
|
|
15,074 |
|
|
|
13,017 |
|
16% |
|||
|
Total revenue |
|
218 |
|
|
320 |
|
|
(32)% |
|
333 |
|
|
(35)% |
|
|
538 |
|
|
481 |
|
12% |
||||
|
Mortgage originations margin |
|
2.78 |
% |
|
3.40 |
% |
|
(18)% |
|
4.39 |
% |
|
(37)% |
|
|
3.13 |
% |
|
3.27% |
|
(4)% |
||||
|
Pre-tax (loss) income |
|
$ |
(6) |
|
|
$ |
96 |
|
|
(106)% |
|
$ |
117 |
|
|
(105)% |
|
|
90 |
|
|
|
127 |
|
(29)% |
| (1) Financial results of combined successor and predecessor of the business combination with Replay. |
- Funded volume totaled $6,929 million compared to $7,582 million in the prior year quarter and $8,404 million in the prior quarter.
- Net rate lock volume totaled $6,669 million compared to $6,802 million in the prior year quarter and $8,405 million in the prior quarter as refinance volumes declined in line with industry dynamics due to rising interest rates.
- Total revenue of $218 million compared to $333 million in the prior year quarter and $320 million in the prior quarter reflect the impact of both lower gain on sale margins and net rate lock volume in the quarter.
- Pre-tax loss of $6 million for the second quarter compared to pre-tax income of $96 million in the prior quarter. The decline in quarterly earnings was largely a function of the decline in origination volumes and margins, reflecting tighter spreads across the industry as a result of normalizing supply and demand trends. Expenses remained flat quarter over quarter as the decrease in variable costs was offset by non-recurring Business Combination expenses and impacts related to previously announced acquisitions. In combination, these totaled $14 million.
Reverse Originations
The Reverse Originations segment generates revenue and earnings in the form of net origination gains and origination fees earned on the origination of reverse mortgage loans.
|
($ amounts in millions) |
|
|
|
|
|
Variance |
|
|
|
Variance |
|
|
|
|
|
Variance |
||||||||||
|
|
|
Q2’21 |
|
Q1’21 |
|
Q2’21 vs |
|
Q2’20 |
|
Q2’21 vs |
|
YTD 2021 |
|
YTD 2020 |
|
2021 vs |
||||||||||
|
|
|
Successor |
|
Predecessor |
|
|
|
Predecessor |
|
|
|
Combined(1) |
|
Predecessor |
|
|
||||||||||
|
Funded volume |
|
$ |
1,013 |
|
|
$ |
769 |
|
|
32% |
|
$ |
770 |
|
|
32% |
|
$ |
1,782 |
|
|
$ |
1,426 |
|
|
25% |
|
Total revenue |
|
95 |
|
|
69 |
|
|
38% |
|
55 |
|
|
73% |
|
164 |
|
|
90 |
|
|
82% |
|||||
|
Pre-tax income |
|
53 |
|
|
45 |
|
|
18% |
|
33 |
|
|
61% |
|
99 |
|
|
50 |
|
|
98% |
|||||
| (1) Financial results of combined successor and predecessor of the business combination with Replay. |
- Funded volume increased to $1,013 million, up 32% over each of the prior quarter and second quarter of 2020, marking the highest quarterly volume ever for the Reverse Originations segment.
- Funded volume and total revenue grew in the second quarter as home price appreciation continued, reflecting the distinct tailwinds in the Reverse Originations segment.
- Generated pre-tax income of $53 million during the second quarter compared to $33 million in the prior year period and $45 million in the prior quarter. The second quarter was impacted by non-recurring expenses of $4 million related to the Business Combination.
Commercial Originations
The Commercial Originations segment provides business purpose lending solutions for residential real estate investors. The Commercial Originations segment generates revenue and earnings in the form of net origination gains and origination fees earned on the origination of mortgage loans.
|
($ amounts in millions) |
|
|
|
|
|
Variance |
|
|
|
Variance |
|
|
|
|
|
Variance |
||||||||
|
|
|
Q2’21 |
|
Q1’21 |
|
Q2’21 vs |
|
Q2’20 |
|
Q2’21 vs |
|
YTD 2021 |
|
YTD 2020 |
|
2021 vs |
||||||||
|
|
|
Successor |
|
Predecessor |
|
|
|
Predecessor |
|
|
|
Combined(1) |
|
Predecessor |
|
|
||||||||
|
Funded volume |
|
$ |
400 |
|
|
$ |
341 |
|
|
17% |
|
$ |
14 |
|
|
2757% |
|
741 |
|
|
458 |
|
|
62% |
|
Total revenue |
|
23 |
|
|
14 |
|
|
64% |
|
— |
|
|
—% |
|
37 |
|
|
20 |
|
|
85% |
|||
|
Pre-tax (loss) income |
|
3 |
|
|
1 |
|
|
200% |
|
(6) |
|
|
(150)% |
|
4 |
|
|
(3) |
|
|
(233)% |
|||
| (1) Financial results of combined successor and predecessor of the business combination with Replay. |
- Funded volume of $400 million compared to $341 million in the prior quarter and $14 million in the second quarter of 2020.
- Pre-tax income of $3 million compared to $1 million in the prior quarter. The second quarter was impacted by increased non-recurring expenses of $1 million related to the Business Combination.
- Funded volume and total revenue continued to grow quarter over quarter as demand from both borrowers and investors remains robust.
Portfolio Management
The Portfolio Management segment generates revenue and earnings in the form of gain on sale of loans, fair value gains, interest income, servicing income, fees for underwriting, advisory and valuation services and other ancillary fees.
|
($ amounts in millions) |
|
|
|
|
|
Variance |
|
|
|
Variance |
|
|
|
|
|
Variance |
||||||||
|
|
|
Q2’21 |
|
Q1’21 |
|
Q2’21 vs |
|
Q2’20 |
|
Q2’21 vs |
|
YTD 2021 |
|
YTD 2020 |
|
2021 vs |
||||||||
|
|
|
Successor |
|
Predecessor |
|
|
|
Predecessor |
|
|
|
Combined(1) |
|
Predecessor |
|
|
||||||||
|
Assets under management |
|
$ |
17,997 |
|
|
$ |
17,378 |
|
|
4% |
|
$ |
16,145 |
|
|
11% |
|
17,997 |
|
|
16,145 |
|
|
11% |
|
Assets excluding |
|
2,388 |
|
|
2,224 |
|
|
7% |
|
1,966 |
|
|
21% |
|
2,388 |
|
|
1,966 |
|
|
21% |
|||
|
Total revenue |
|
7 |
|
|
29 |
|
|
(76)% |
|
39 |
|
|
82% |
|
36 |
|
|
(11) |
|
|
(427)% |
|||
|
Pre-tax (loss) income |
|
(27) |
|
|
6 |
|
|
(550)% |
|
18 |
|
|
250% |
|
(21) |
|
|
(49) |
|
|
(57)% |
|||
| (1) Financial results of combined successor and predecessor of the business combination with Replay. |
| (2) Calculated for each period as Assets under management less HMBS related obligations, at fair value and Nonrecourse debt, at fair value |
- Assets under management grew $619 million compared to the prior quarter as a result of growth in loans held for investment and MSR.
- Total revenue of $7 million for the second quarter of 2021 compared to $29 million in the prior quarter and $39 million during the same period last year.
- The quarter over quarter decrease in revenue and pre-tax income reflect the impact of fair value adjustments related predominantly to higher expected prepayment speeds on securitized mortgage assets and MSR. The sequential quarter reduction was also impacted by non-recurring expenses of $7 million related to the Business Combination.
Lender Services
The Lender Services business generates revenue and earnings in the form of fees. Lender Services supports over 1,600 third party clients across the lending industry.
|
($ amounts in millions) |
|
|
|
|
|
Variance |
|
|
|
Variance |
|
|
|
|
|
Variance |
||||||
|
|
|
Q2’21 |
|
Q1’21 |
|
Q2’21 vs |
|
Q2’20 |
|
Q2’21 vs |
|
YTD 2021 |
|
YTD 2020 |
|
2021 vs |
||||||
|
|
|
Successor |
|
Predecessor |
|
|
|
Predecessor |
|
|
|
Combined(1) |
|
Predecessor |
|
|
||||||
|
Total revenue |
|
$ |
81 |
|
|
$ |
76 |
|
|
7% |
|
$ |
44 |
|
|
84% |
|
157 |
|
86 |
|
83% |
|
Pre-tax income |
|
8 |
|
|
13 |
|
|
(38)% |
|
5 |
|
|
60% |
|
21 |
|
7 |
|
200% |
|||
| (1) Financial results of combined successor and predecessor of the business combination with Replay. |
- The Lender Services segment earned revenue of $81 million, compared to $76 million in the prior quarter and $44 million during the same period last year. The second quarter of 2021 marks the highest level of revenue on record for the Lender Services segment.
- Our focus on expanding business lines to deepen cross-sell, combined with the onboarding of new third party customers across our businesses, resulted in strong growth in our title agency and underwriting products.
- Quarterly pre-tax income of $8 million compared to $5 million in the prior year quarter and $13 million in the prior quarter. Sequential quarter reduction was a result of non-recurring expenses of $3 million related to the Business Combination.
|
Reconciliation to GAAP |
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
($ amounts in millions) |
|
Q2’21 |
|
|
Q1’21 |
|
Q2’20 |
|
YTD 2021 |
|
YTD 2020 |
|||||||||||||
|
|
|
Successor |
|
|
Predecessor |
|
Predecessor |
|
Combined(1) |
|
Predecessor |
|||||||||||||
|
Reconciliation of Net income (loss) to |
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Net income (loss) |
|
$ |
(15) |
|
|
|
$ |
124 |
|
|
$ |
146 |
|
|
$ |
109 |
|
|
$ |
104 |
|
|||
|
Adjustments for: |
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Change in fair value of loans and securities |
|
20 |
|
|
|
2 |
|
|
— |
|
|
22 |
|
|
71 |
|
||||||||
|
Amortization and impairment of intangibles |
|
13 |
|
|
|
1 |
|
|
1 |
|
|
14 |
|
|
1 |
|
||||||||
|
Change in fair value of deferred purchase |
|
3 |
|
|
|
— |
|
|
— |
|
|
3 |
|
|
— |
|
||||||||
|
Change in fair value of warrant liability |
|
1 |
|
|
|
— |
|
|
— |
|
|
1 |
|
|
— |
|
||||||||
|
Share based compensation |
|
11 |
|
|
|
— |
|
|
— |
|
|
11 |
|
|
— |
|
||||||||
|
Change in fair value of minority investments |
|
— |
|
|
|
9 |
|
|
— |
|
|
9 |
|
|
— |
|
||||||||
|
Certain non-recurring costs(2) |
|
43 |
|
|
|
7 |
|
|
2 |
|
|
50 |
|
4 |
|
|||||||||
|
Tax effect of adjustments attributable to |
|
(5) |
|
|
|
N/A |
|
N/A |
|
(5) |
|
|
N/A |
|||||||||||
|
Tax effect on net income (loss) attributable |
|
4 |
|
|
|
(31) |
|
|
(38) |
|
|
(27) |
|
|
(26) |
|
||||||||
|
Tax effect of adjustments attributable to |
|
(18) |
|
|
|
(5) |
|
|
(1) |
|
|
(23) |
|
|
|
(20) |
|
|||||||
|
Adjusted Net Income |
|
$ |
57 |
|
|
|
$ |
107 |
|
|
$ |
110 |
|
|
$ |
164 |
|
|
$ |
134 |
|
|||
|
Effective income taxes |
|
$ |
21 |
|
|
|
$ |
37 |
|
|
$ |
39 |
|
|
$ |
58 |
|
|
$ |
46 |
|
|||
|
Depreciation |
|
2 |
|
|
|
2 |
|
|
2 |
|
|
4 |
|
|
4 |
|
||||||||
|
Interest expense on non-funding debt |
|
7 |
|
|
|
8 |
|
|
2 |
|
|
15 |
|
|
4 |
|
||||||||
|
Adjusted EBITDA |
|
$ |
87 |
|
|
|
$ |
154 |
|
|
$ |
153 |
|
|
$ |
241 |
|
|
$ |
188 |
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
OTHER KEY METRICS |
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Cash taxes paid |
|
$ |
2 |
|
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
2 |
|
|
$ |
— |
|
|||
|
Provision for income taxes |
|
$ |
1 |
|
|
|
$ |
1 |
|
|
$ |
— |
|
|
$ |
2 |
|
|
$ |
1 |
|
|||
|
(1) Financial results of combined successor and predecessor of the business combination with Replay. (2) Certain non-recurring costs relate to various one-time expenses and adjustments that management believes should be excluded as these do not relate to a recurring part of the core business operations. These items include certain one-time charges including estimated settlements for legal and regulatory matters, acquisition related expenses and other one-time charges. (3) We applied a 26% effective tax rate to pre-tax income and adjustments for the respective period to determine the tax effect of net income (loss) attributable to the controlling and noncontrolling interests |
||||||||||||||||||||||||
|
($ amounts in millions, except shares and $ per share) |
|
Q2’21 |
|
|
Q1’21 |
|
Q2’20 |
|
YTD 2021 |
|
YTD 2020 |
|||||||||||||
|
|
|
Successor |
|
|
Predecessor |
|
Predecessor |
|
Combined(1) |
|
Predecessor |
|||||||||||||
|
GAAP PER SHARE MEASURES |
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Net income attributable to controlling interest |
|
$ |
2 |
|
|
|
N/A |
|
N/A |
|
$ |
2 |
|
|
N/A |
|||||||||
|
Average outstanding share count |
|
59,882 |
|
|
|
N/A |
|
N/A |
|
59,882 |
|
|
N/A |
|||||||||||
|
Basic earnings per share |
|
$ |
0.04 |
|
|
|
N/A |
|
N/A |
|
$ |
0.04 |
|
|
N/A |
|||||||||
|
If-converted method net (loss) income |
|
(10) |
|
|
|
120 |
|
|
148 |
|
|
110 |
|
|
121 |
|
||||||||
|
Weighted average diluted share count |
|
191,200 |
|
|
|
191,200 |
|
|
191,200 |
|
|
191,200 |
|
|
191,200 |
|
||||||||
|
Diluted earnings per share |
|
$ |
(0.05) |
|
|
|
$ |
0.63 |
|
|
$ |
0.78 |
|
|
$ |
0.58 |
|
|
$ |
0.63 |
|
|||
|
Book Equity |
|
$ |
2,379 |
|
|
|
$ |
844 |
|
|
$ |
775 |
|
|
$ |
2,379 |
|
|
$ |
775 |
|
|||
|
Weighted average diluted share count |
|
191,200 |
|
|
|
191,200 |
|
|
191,200 |
|
|
191,200 |
|
|
191,200 |
|
||||||||
|
Book Equity per diluted share |
|
$ |
12.44 |
|
|
|
$ |
4.42 |
|
|
$ |
4.05 |
|
|
$ |
12.44 |
|
|
$ |
4.05 |
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
NON-GAAP PER SHARE MEASURES |
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
Adjusted net income |
|
$ |
57 |
|
|
|
$ |
107 |
|
|
$ |
110 |
|
|
$ |
164 |
|
|
$ |
134 |
|
|||
|
Weighted average diluted share count |
|
191,200 |
|
|
|
191,200 |
|
|
191,200 |
|
|
191,200 |
|
|
191,200 |
|
||||||||
|
Adjusted net income per diluted share |
|
$ |
0.30 |
|
|
|
$ |
0.56 |
|
|
$ |
0.58 |
|
|
$ |
0.86 |
|
|
$ |
0.70 |
|
|||
|
1) Financial results of combined successor and predecessor of the business combination with Replay. |
||||||||||||||||||||||||
|
|
||||||||||||||||||||||||
|
Finance of America Companies Inc. and Subsidiaries
Consolidated Statements of Financial Condition |
|||||||
|
|
June 30, 2021 |
|
December 31, 2020 |
||||
|
|
Successor |
|
Predecessor |
||||
|
|
(unaudited) |
|
|
||||
|
ASSETS |
|
|
|
||||
|
Cash and cash equivalents |
$ |
157,336 |
|
|
$ |
233,101 |
|
|
Restricted cash |
354,390 |
|
|
306,262 |
|
||
|
Reverse mortgage loans held for investment, subject to HMBS related |
10,316,027 |
|
|
9,929,163 |
|
||
|
Mortgage loans held for investment, subject to nonrecourse debt, at fair value |
5,424,621 |
|
|
5,396,167 |
|
||
|
Mortgage loans held for investment, at fair value |
1,225,090 |
|
|
730,821 |
|
||
|
Mortgage loans held for sale, at fair value |
2,057,542 |
|
|
2,222,811 |
|
||
|
Debt securities |
8,694 |
|
|
10,773 |
|
||
|
Mortgage servicing rights, at fair value, $65,129 and $14,088, subject to |
290,938 |
|
|
180,684 |
|
||
|
Derivative assets |
61,811 |
|
|
92,065 |
|
||
|
Fixed assets and leasehold improvements, net |
28,669 |
|
|
24,512 |
|
||
|
Goodwill |
1,298,324 |
|
|
121,233 |
|
||
|
Intangible assets, net |
704,243 |
|
|
16,931 |
|
||
|
Other assets, net |
300,253 |
|
|
300,632 |
|
||
|
TOTAL ASSETS |
$ |
22,227,938 |
|
|
$ |
19,565,155 |
|
|
|
|
|
|
||||
|
LIABILITIES, CONTINGENTLY REDEEMABLE NONCONTROLLING INTEREST |
|
|
|
||||
|
HMBS related obligation, at fair value |
$ |
10,168,224 |
|
|
$ |
9,788,668 |
|
|
Nonrecourse debt, at fair value |
5,425,732 |
|
|
5,271,842 |
|
||
|
Other financing lines of credit |
3,412,234 |
|
|
2,973,743 |
|
||
|
Payables and other liabilities |
488,735 |
|
|
400,058 |
|
||
|
Notes payable, net |
353,718 |
|
|
336,573 |
|
||
|
TOTAL LIABILITIES |
19,848,643 |
|
|
18,770,884 |
|
||
|
|
|
|
|
||||
|
CRNCI |
— |
|
|
166,231 |
|
||
|
EQUITY |
|
|
|
||||
|
FoA Equity Capital LLC member’s equity |
— |
|
|
628,176 |
|
||
|
Class A Common Stock (Successor), $0.0001 par value; 6,000,000,000 shares |
6 |
|
|
— |
|
||
|
Class B Common Stock (Successor), $0.0001 par value; 1,000,000 shares |
— |
|
|
— |
|
||
|
Additional paid-in capital (Successor) |
806,424 |
|
|
— |
|
||
|
Accumulated deficit (Successor) |
(68,451) |
|
|
— |
|
||
|
Accumulated other comprehensive (loss) income |
(27) |
|
|
9 |
|
||
|
Noncontrolling interest |
1,641,343 |
|
|
(145) |
|
||
|
TOTAL EQUITY |
2,379,295 |
|
|
628,040 |
|
||
|
TOTAL LIABILITIES, CRNCI AND EQUITY |
$ |
22,227,938 |
|
|
$ |
19,565,155 |
|
|
Finance of America Companies Inc. and Subsidiaries
Consolidated Statements of Operations (Unaudited) |
|||||||||||||||||
|
|
|
April 1, 2021 |
|
|
January 1, 2021 |
|
For the three |
|
For the six |
||||||||
|
|
|
Successor |
|
|
Predecessor |
||||||||||||
|
REVENUES |
|
|
|
|
|
|
|
|
|
||||||||
|
Gain on sale and other income from |
|
$ |
187,577 |
|
|
|
$ |
291,334 |
|
|
$ |
298,291 |
|
|
$ |
428,975 |
|
|
Net fair value gains on mortgage loans |
|
131,151 |
|
|
|
76,663 |
|
|
112,303 |
|
|
125,683 |
|
||||
|
Fee income |
|
90,864 |
|
|
|
161,371 |
|
|
76,656 |
|
|
146,627 |
|
||||
|
Net interest expense: |
|
|
|
|
|
|
|
|
|
||||||||
|
Interest income |
|
13,151 |
|
|
|
12,661 |
|
|
11,507 |
|
|
19,678 |
|
||||
|
Interest expense |
|
(33,626) |
|
|
|
(34,366) |
|
|
(33,298) |
|
|
(67,230) |
|
||||
|
Net interest expense |
|
(20,475) |
|
|
|
(21,705) |
|
|
(21,791) |
|
|
(47,552) |
|
||||
|
TOTAL REVENUES |
|
389,117 |
|
|
|
507,663 |
|
|
465,459 |
|
|
653,733 |
|
||||
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
EXPENSES |
|
|
|
|
|
|
|
|
|
||||||||
|
Salaries, benefits and related expenses |
|
274,731 |
|
|
|
238,530 |
|
|
230,275 |
|
|
374,653 |
|
||||
|
Occupancy, equipment rentals and other office related expenses |
|
6,720 |
|
|
|
7,597 |
|
|
7,208 |
|
|
14,611 |
|
||||
|
General and administrative expenses |
|
119,301 |
|
|
|
127,217 |
|
|
81,214 |
|
|
159,780 |
|
||||
|
TOTAL EXPENSES |
|
400,752 |
|
|
|
373,344 |
|
|
318,697 |
|
|
549,044 |
|
||||
|
OTHER, NET |
|
(2,103) |
|
|
|
(8,862) |
|
|
(28) |
|
|
(44) |
|
||||
|
NET (LOSS) INCOME BEFORE INCOME TAXES |
|
(13,738) |
|
|
|
125,457 |
|
|
146,734 |
|
|
104,645 |
|
||||
|
Provision for income taxes |
|
1,086 |
|
|
|
1,137 |
|
|
448 |
|
|
766 |
|
||||
|
NET (LOSS) INCOME |
|
(14,824) |
|
|
|
124,320 |
|
|
146,286 |
|
|
103,879 |
|
||||
|
CRNCI |
|
— |
|
|
|
4,260 |
|
|
(2,620) |
|
|
(18,006) |
|
||||
|
Noncontrolling interest |
|
(17,089) |
|
|
|
201 |
|
|
571 |
|
|
800 |
|
||||
|
NET INCOME ATTRIBUTABLE TO |
|
$ |
2,265 |
|
|
|
$ |
119,859 |
|
|
$ |
148,335 |
|
|
$ |
121,085 |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
EARNINGS PER SHARE |
|
|
|
|
|
|
|
|
|
||||||||
|
Basic weighted average shares outstanding |
|
59,881,714 |
|
|
|
— |
|
|
— |
|
|
— |
|
||||
|
Basic net income per share |
|
$ |
0.04 |
|
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
— |
|
|
Diluted weighted average shares outstanding |
|
191,200,000 |
|
|
|
— |
|
|
— |
|
|
— |
|
||||
|
Diluted net loss per share |
|
$ |
(0.05) |
|
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
— |
|
|
Finance of America Companies Inc. and Subsidiaries
Consolidated Statements of Equity (Unaudited) |
|||||||||||||||
|
|
FoA Equity |
|
Accumulated |
|
Noncontrolling |
|
Total |
||||||||
|
Balance at December 31, 2019 (audited) |
$ |
482,719 |
|
|
$ |
(51) |
|
|
$ |
145 |
|
|
$ |
482,813 |
|
|
Contributions from members |
1,042 |
|
|
— |
|
|
— |
|
|
1,042 |
|
||||
|
Net (loss) income |
(27,249) |
|
|
— |
|
|
229 |
|
|
(27,020) |
|
||||
|
Foreign currency translation adjustment |
— |
|
|
(8) |
|
|
— |
|
|
(8) |
|
||||
|
Balance at March 31, 2020 |
456,512 |
|
|
(59) |
|
|
374 |
|
|
456,827 |
|
||||
|
Contributions from members |
(578) |
|
|
— |
|
|
— |
|
|
(578) |
|
||||
|
Distributions to members |
— |
|
|
— |
|
|
— |
|
|
— |
|
||||
|
Noncontrolling interest distributions |
— |
|
|
— |
|
|
(310) |
|
|
(310) |
|
||||
|
Net income |
148,335 |
|
|
— |
|
|
571 |
|
|
148,906 |
|
||||
|
Foreign currency translation adjustment |
— |
|
|
18 |
|
|
— |
|
|
18 |
|
||||
|
Balance at June 30, 2020 |
$ |
604,269 |
|
|
$ |
(41) |
|
|
$ |
635 |
|
|
$ |
604,863 |
|
|
|
|
|
|
|
|
|
|
||||||||
|
Balance at December 31, 2020 |
$ |
628,176 |
|
|
$ |
9 |
|
|
$ |
(145) |
|
|
$ |
628,040 |
|
|
Contributions from members |
1,426 |
|
|
— |
|
|
— |
|
|
1,426 |
|
||||
|
Distributions to members |
(75,000) |
|
|
— |
|
|
— |
|
|
(75,000) |
|
||||
|
Noncontrolling interest distributions |
— |
|
|
— |
|
|
(620) |
|
|
(620) |
|
||||
|
Net income |
119,859 |
|
|
— |
|
|
201 |
|
|
120,060 |
|
||||
|
Accretion of CRNCI to redemption price |
(32,725) |
|
|
— |
|
|
— |
|
|
(32,725) |
|
||||
|
Foreign currency translation adjustment |
— |
|
|
(11) |
|
|
— |
|
|
(11) |
|
||||
|
Balance at March 31, 2021 |
$ |
641,736 |
|
|
$ |
(2) |
|
|
$ |
(564) |
|
|
$ |
641,170 |
|
Contacts
For Finance of America Media: pr@financeofamerica.com
For Finance of America Investor Relations: ir@financeofamerica.com