Re/max Holdings, Inc. · NYSE:RMAX
Re/max — Q2 2023 Earnings Presentation
22 slides from Re/max's earnings presentation, Aug 3, 2023
Slide 1: Second Quarter 2023 Earnings
RE/MAX RE/MAX Holdings, Inc. Second Quarter 2023 Earnings August 3, 2023
Slide 2: Forward-Looking Statements
Forward-Looking Statements This presentation includes “forward-looking statements” within the meaning of the “safe harbor” provisions of the United States Private Securities Litigation Reform Act of 1995. Forward-looking statements are often identified by the use of words such as “believe,” “intend,
Slide 3: Q2 2023 Highlights
Q2 2023 Highlights Total Revenue of $82.4 Million, Adjusted EBITDA of $26.6 Million, Adjusted Diluted EPS of $0.40 Q2 2023 Operating Highlights Q2 2023 Financial Highlights = Total agent count grew 571 agents, or 0.4%, » Revenue was $82.4 million, a decrease of YoY to 144,510 agents 10.6% » Agent co
Slide 4: Motto Open Offices Increased 17.5% YoY
Ho eee Motto Open Offices Increased 17.5% YoY to 235 offices as of June 30, 2023 © 8 Franchise Sales in Q2 2023; Challenging Market Conditions Have Slowed Pace of Franchise Sales New Inside Sales Team with Franchise Experience Recently Joined Motto TTO MORTGAGE Motto offices now using wemlo Loan Bro
Slide 5: Global agent count accelerated year-over-year
Global agent count accelerated year-over- year RE/MAX’ Teams ..rogressing steadily ersions, Mer Acquisiti Canadian agent count has grown in every larger transactions month of 2023 beginning in February starting to be completed MAXTECH U.S. agent count losses ..adoption and engagement ~~ . above indu
Slide 6: Revenue
Revenue Total Revenue down 10.6%, Negative Organic Revenue growth of 10.5% Quarter to Date Year to Date Increase/(Decrease) 2023 2022 Increase/(Decrease) $ % $ % Revenue ($M) 2023 2022 Continuing franchise fees $321 $341 ($2.0) (5.9%) $64.2 $67.6 ($3.4) (5.1%) Annual dues $8.6 $9.0 ($0.4) (4.8%) $17
Slide 7: Selling, Operating and Administrative Expenses
Selling, Operating and Administrative Expenses Total Selling, Operating and Administrative expenses down 1.4% Quarter to Date Year to Date Selling, Operating & Administrative Increase/(Decrease) Increase/(Decrease) Expenses ($M) 2023 2022 x 2023 2022 $ & A fy Personnel 4.5% ($0.7) (1.3%) Professiona
Slide 8: Looking Ahead - Q3 2023 and FY 2023 Outlook
Looking Ahead - Q3 2023 and FY 2023 Outlook Focused on Growing our Business, our Brands, and our Networks Q3 2023 Outlook' Full Year 2023 Outlook! For the third quarter of 2023, RE/MAX For the Full Year 2023, the Company is Holdings expects: tightening its guidance ranges and now expects: = Agent co
Slide 9: A Leading Dual-Brand Franchisor with Compelling Growth Opportunities
A Leading Dual-Brand Franchisor with Compelling Growth Opportunities 9 9
Slide 10: Thank You
THANK YOU RE/MAX HOLDINGS, INC
Slide 11: Growing Our Global Network
Growing Our Global Network Year-over-Year Agent Count Growth of 0.4% Agent Count Change Year-over-Year HM June 30, 2022 HB June 30, 2023 +0.4% YoY (+571 agents) 143,939 144,510 -4.1% YoY Total RE/MAX U.S. & Canada RE/MAX (-3,474 agents) +6.9% YoY (+4,045 agents) Outside U.S. & Canada 11
Slide 12: Agent Count Change Year-over-Year
Agent Count Change Year-over-Year June 30, 2023, over June 30, 2022 +6.9% +1.5% -6.3% (+4,045 Agents) (+364 Agents) (-3,838 Agents) Agents Outside U.S. & Canada Agents in Canada Agents in the U.S. Total agent count grew 571 agents, or 0.4%, YoY to 144,510 agents RE/MAX 12
Slide 13: Adjusted EBITDA of $26.6 Million
Adjusted EBITDA! of $26.6 Million Adjusted EBITDA Margin! of 32.3% Adjusted EBITDA! ($M) Adjusted EBITDA Margin! $35.1 $26.6 32.7% 32.3% (> nv v v ip io paid oa a s aa e oa Y Sy L Ry be $ y é fet 3 fe fey 3 3 For Q2 2023: = Adjusted EBITDA was $26.6 million for the second quarter of 2023, a decrease
Slide 14: Strong Balance Sheet Bolsters Ability to Reinvest and Return Capital
Strong Balance Sheet Bolsters Ability to Reinvest and Return Capital to Shareholders Balance Sheet & Leverage = Cash balance of $96.8 million on June 30, 2023, down $11.9 million from December 31, 2022 = $446.4 million in outstanding debt! and no revolving loans outstanding = Total Debt / Adjusted E
Slide 15: Industry Forecasts
Industry Forecasts Monthly Existing Home Sales! (Thousands) Annual Existing Home Sales!:23 (Millions) 650 mFannieMae mNAR ae at 2 22 29 oy a 1 2021 2022 2023e yor" yo yo yor" yo yo yw yo" RE/MAX Home Price Appreciation23 (YoY) Housing Starts - Single Family4 (Thousands) mFannieMae =NAHB. mFannic Mac
Slide 16: Mortgage Finance Forecasts
Mortgage Finance Forecasts $3,000 $2,500 $2,000 $1,500 $1,000 $500 $0 Loan Originations' ($’s in billions) mPurchase mRefinance 2021 2022 2023e RE/MAX DIN ‘Source: Mortgage Bankers Association - MBA Mortgage Finance Forecast July 2023 Mortgage & Interest Rates! —+-30-Year Fixed —t10-Year Treasury 6.
Slide 17: Agent Count by Region
As of June 30, March 31, December 31, September 30, June 30, March 31, December 31, September 30, June 30, 2023 2023 2022 2022 2022 2022 2021 2021 2021 Agent Count: U.S. Company-Owned Regions 50,011 50,340 51,491 52,804 53,415 53,338 53,946 54,578 48,025 Independent Regions 6,976 7,110 7,228 7,311 7
Slide 18: Adjusted EBITDA Reconciliation
Three Months Ended Six Months Ended June 30, June 30, 2023 2022 2023 2022 Net income (loss) $ 3,244 $ 10,275 $ 2,565 $ 13,220 Depreciation and amortization 8,008 9,113 16,041 18,098 Interest expense 8,840 4,032 17,085 7,683 Interest income (1,141) (159) (2,145) (178) Provision for income taxes 2,422
Slide 19: Adjusted Net Income Reconciliation
Three Months Ended Six Months Ended June 30, June 30, 2023 2022 2023 2022 Net income (loss) $ 3,244 $ 10,275 $ 2,565 $ 13,220 Amortization of acquired intangible assets 5,773 6,565 11,531 12,734 Provision for income taxes 2,422 2,601 2,814 3,806 Add-backs: Impairment charge - leased assets (1) — — —
Slide 20: Adjusted Free Cash Flow Reconciliation
Six Months Ended June 30, 2023 2022 Cash flow from operations $ 2,242 $ 38,919 Less: Purchases of property, equipment and capitalization of software (2,831) (6,144) (Increases) decreases in restricted cash of the Marketing Funds (1) 11,786 (3,548) Adjusted free cash flow (2) 11,197 29,227 Adjusted f
Slide 21: Non-GAAP Financial Measures
Non-GAAP Financial Measures The SEC has adopted rules to regulate the use in filings with the SEC and in public disclosures of financial measures that are not in accordance with U.S. GAAP, such as revenue excluding the Marketing Funds, Adjusted EBITDA and the ratios related thereto, Adjusted net inc
Slide 22: Non-GAAP Financial Measures (continued)
Non-GAAP Financial Measures (continued) Adjusted net income is calculated as Net income attributable to RE/MAX Holdings, assuming the full exchange of all outstanding non-controlling interests for shares of Class A common stock as of the beginning of the period (and the related increase to the provi