Walker & Dunlop, Inc · NYSE:WD
Walker & Dunlop — Q1 2022 Earnings Presentation
18 slides from Walker & Dunlop's earnings presentation, May 5, 2022
Slide 1: First Quarter 2022 Earnings
Q1 FIRST QUARTER 2022 EARNINGS May 5, 2022
Slide 2: Forward-Looking Statements
Forward-Looking Statements Some of the statements contained in this presentation may constitute forward-looking statements within the meaning of the federal securities laws. Forward-looking statements relate to expectations, projections, plans and strategies, anticipated events or trends and similar
Slide 3: Q1'22 Consolidated Key Performance Metrics
S T R O N G F I N A N C I A L R E S U LT S R E F L E C T B R O A D C A PA B I L I T I E S O F P L AT F O R M Q1’22 Consolidated Key Performance Metrics Total Transaction Volume Total Revenues Diluted EPS $2.12 (in millions) (in thousands) $319,444 $12,667 $224,288 $9,044 $1.79 Q1'21 Q1'22 Q1'21 Q1'2
Slide 4: Total Transaction Volume by Product
TRANSACTION VOLUME GROWTH DRIVEN BY P R O P E RT Y S A L E S , D E B T B R O K E R A G E , A N D FA N N I E M A E Total Transaction Volume (in millions) $5,643 $4,302 $3,532 $1,998 $1,533 $1,396 $1,013 $988 $622 $392 $178 $114 Fannie Mae Freddie Mac HUD Brokered Principal Lending and Investing Prope
Slide 5: People, Technology, Brand Q1 2022
PEOPLE Q1 2022 BRAND 61% of refinancing volume1 was new loans 19% of total transaction volume was with new clients 5 1) Represents refinancings that were added to Walker & Dunlop TECHNOLOGY 5 servicing portfolio in Q1’22
Slide 6: Summary of New Operating Segments
S U M M A R Y O F N E W O P E R AT I N G S E G M E N T S CAPITAL MARKETS SERVICING & ASSET MANAGEMENT CORPORATE • Servicing • Infrastructure • Agency Lending • LIHTC Syndication • Treasury • Debt Brokerage • Asset Management • Other Corporate • Property Sales • Proprietary Capital Services • Valuati
Slide 7: Capital Markets Q1 Key Financial Metrics
C A P I TA L M A R K E T S Q1 KEY FINANCIAL METRICS (in thousands) Q1’22 Q1’21 % Change Total Revenues $164,244 $147,291 12% Net Income $46,560 $56,118 (17%) Operating Margin 36% 48% Adjusted EBITDA1 $11,256 $17,131 (34%) • Growth in total revenues driven by 40% year-over-year increase in total tran
Slide 8: Servicing & Asset Management Q1 Key Financial Metrics
S E RV I C I N G & A S S E T M A N A G E M E N T ( “ S A M ” ) Q1 KEY FINANCIAL METRICS (in thousands) Q1’22 Q1’21 % Change Total Revenues $111,066 $78,165 42% Net Income $32,716 $27,565 19% Operating Margin 37% 44% Adjusted EBITDA1 $87,773 $69,419 26% • Ended Q1’22 with $116 billion servicing portf
Slide 9: Corporate Q1 Key Financial Metrics
C O R P O R AT E Q1 KEY FINANCIAL METRICS (in thousands) Q1’22 Q1’21 % Change Total Revenues $44,134 ($1,168) (3,879%) Net Income ($8,067) ($25,631) (69%) Adjusted EBITDA1 ($36,393) ($25,883) (41%) • Q1’22 revenue growth largely driven by $40 million Apprise revaluation adjustment • Segment net inco
Slide 10: 2022 Financial Outlook
2022 FINANCIAL OUTLOOK 2022 TARGETS Total Revenues DOUBLE DIGIT GROWTH Diluted Earnings Per Share DOUBLE DIGIT GROWTH Adjusted EBITDA DOUBLE DIGIT GROWTH Operating Margin 26% to 29% Return on Equity 19% to 22% 10
Slide 11: Declining Housing Affordability Inhibits Single-Family Homeownership
DECLINING HOUSING AFFORDABILITY INHIBITS S I N G L E - FA M I LY H O M E O W N E R S H I P % of Affordable Homes to Families Earning U.S. Median Income 80.0% 75.0% 70.0% 65.0% 60.0% 55.0% 54% 50.0% 11 Source: NAHB/Wells Fargo Housing Opportunity Index (HOI)
Slide 12: Home Price Growth Links to Solid Multifamily Fundamentals
2 0 % Yo Y G R O W T H I N H O M E P R I C E S L I N K S T O S O L I D M U LT I FA M I LY F U N D A M E N TA L S Case-Shiller 10-Year National Home Price Index 300 280 260 240 Index: Jan 200 = 100 220 200 180 160 140 120 100 1/1/2012 1/1/2013 1/1/2014 1/1/2015 1/1/2016 1/1/2017 1/1/2018 1/1/2019 1/1
Slide 13: Appendix
APPENDIX
Slide 14: Consolidated Adjusted EBITDA Reconciliation to Net Income
C O N S O L I D AT E D A D J U S T E D E B I T D A R E C O N C I L I AT I O N T O C O N S O L I D AT E D N E T I N C O M E Three months ended March 31, Three months ended March 31, (in thousands) 2022 2021 Walker & Dunlop Net Income $71,209 $58,052 Adjustments: Income tax expense 19,460 15,118 Inter
Slide 15: Adjusted Net Income and Adjusted Diluted EPS Reconciliation
ADJUSTED NET INCOME AND ADJUSTED D I L U T E D E P S R E C O N C I L I AT I O N T O N E T I N C O M E Three months ended March 31, Three months ended March 31, (in thousands) 2022 2021 Walker & Dunlop Net Income $71,209 $58,052 Adjustments: Amortization and depreciation 56,152 46,871 Provision (bene
Slide 16: Adjusted EBITDA Reconciliation: Capital Markets
A D J U S T E D E B I T D A R E C O N C I L I AT I O N T O NET INCOME BY SEGMENT Capital Markets Three months ended March 31, Three months ended March 31, (in thousands) 2022 2021 Walker & Dunlop Net Income $46,560 $56,118 Adjustments: Income tax expense 12,847 14,615 Interest expense on corporate d
Slide 17: Adjusted EBITDA Reconciliation: Servicing & Asset Management
A D J U S T E D E B I T D A R E C O N C I L I AT I O N T O NET INCOME BY SEGMENT Servicing & Asset Management Three months ended March 31, Three months ended March 31, (in thousands) 2022 2021 Walker & Dunlop Net Income $32,716 $27,565 Adjustments: Income tax expense 8,839 7,178 Interest expense on
Slide 18: Adjusted EBITDA Reconciliation: Corporate
A D J U S T E D E B I T D A R E C O N C I L I AT I O N T O NET INCOME BY SEGMENT Corporate Three months ended March 31, Three months ended March 31, (in thousands) 2022 2021 Walker & Dunlop Net Income ($8,067) ($25,631) Adjustments: Income tax expense (2,226) (6,675) Interest expense on corporate de