Finance Of America Companies Inc. · NYSE:FOA

Finance Of America Companies — Q2 2022 Earnings Presentation

10 slides from Finance Of America Companies's earnings presentation, Aug 4, 2022

  1. Slide 1: Earnings Presentation | Q2 2022

    Earnings Presentation | Q2 2022 August 2022 ©2022 Finance of America Companies

  2. Slide 2: Disclaimer

    Disclaimer 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. The actual results of Finance of America Companies Inc., together with its subsidiar

  3. Slide 3: Rates and spreads on mortgage assets have increased at a rapid pace in 2022

    Rates and spreads on mortgage assets have increased at a rapid pace in 2022 Trend on 30-Year FRM Rate and 10-Year Treasury Yield(1) Commentary 7.0 • The 30-year fixed rate to the consumer doubled from 6.0 2.9% in December 2020 to 5.8% by June 2022 5.0 • This comprised of a 2.1% increase in the 10-ye

  4. Slide 4: The rapid increase in rates and spreads outpaced our efforts to cut costs in Mortgage

    The rapid increase in rates and spreads outpaced our efforts to cut costs in Mortgage Mortgage Originations: Funded Volume ($M)(1) • The rapid increase in rates and spreads 2,000 caused refinance volume to drop 64% 1,500 between Q1 and Q2 2022 1,000 500 • The drop in refinance was partially offset b

  5. Slide 5: As a proxy for our Reverse and Commercial businesses, Non-QM, Non-Agency rates and spreads have similarly risen

    As a proxy for our Reverse and Commercial businesses, Non-QM, Non-Agency rates and spreads have similarly risen at a rapid pace Trend on Non-QM Spreads and 3-Year Swap(1) Commentary 4.0 • In 2022, underlying Non-QM rates increased at an 3.5 extreme pace and spreads widened to new highs 3.0 • In Q2 a

  6. Slide 6: Our inability to raise rates at the same pace led to compressed margins in Reverse and Commercial

    Our inability to raise rates at the same pace led to compressed margins in our Reverse and Commercial businesses Reverse: Funded Volume ($M) and Average Quarterly Revenue Margin (%) (1) Commentary 2,000 12.0% • Record volumes in Reverse and flat quarter over quarter 1,580 10.0% 1,475 1,500 7.3% volu

  7. Slide 7: The rapid rise in rates and spreads also impacted the fair values of our balance sheet

    The rapid rise in rates and spreads also impacted the fair values of our balance sheet Fair Value Marks by Asset Type ($M) • The balance sheet was hedged against 40 rate increases which generated substantial cash gains; used to pay off 20 14 secured debt - (2) • However, we are unable to efficiently

  8. Slide 8: Q3 2022 Guidance

    Q3 2022 Guidance Mortgage Adjusted Net Loss ($M)(1) SF&S Adjusted Net Income (Loss) ($M)(1) $10 $50 $47 $40 $- $30 $(10) $20 $(10) $10 $(20) $(21) $- $(1) $(30) $(10) Q1 2022 Q2 2022 Q1 2022 Q2 2022 Extreme market volatility makes segment projections unreliable Assuming markets stabilize at current

  9. Slide 9: Supporting Materials

    SUPPORTING MATERIALS FINANCE OF AMERICA COMPANIES | Slide 9

  10. Slide 10: Non-GAAP Reconciliation for Mortgage and SF&S

    Non-GAAP Reconciliation for Mortgage and SF&S Mortgage All values in $ millions Q1 2022 Q2 2022 Net loss before taxes $(22) $(35) Adjustments for: Changes in fair value(1) - - Amortization and impairment of goodwill and intangible assets(2) 2 2 Share-based compensation(3) 2 2 Certain non-recurring c

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