Walker & Dunlop, Inc · NYSE:WD
Walker & Dunlop — Q1 2020 Earnings Presentation
13 slides from Walker & Dunlop's earnings presentation, May 6, 2020
Slide 1: First Quarter 2020 Earnings
FIRST QUARTER 2020 EARNINGS May 6, 2020
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: Strong Growth Across Transaction Types Led to Record Volume of $11.4 Billion
STRONG GROWTH ACROSS TRANSACTION TYPES LED TO RECORD VOLUME OF $11.4 BILLION Breakdown of Total Transaction Volume (in millions) $4,171 $3,994 $1,983 $1,731 $1,574 $1,434 $998 $697 $355 $178 $108 $76 Fannie Mae Freddie Mac HUD Brokered Principal Lending and Property Sales Investing Q1'19 Q1'20 Q1’ 2
Slide 4: Dramatic Growth in Volumes and Revenue Due to Team, Brand & Execution Capabilities
D R A M AT I C G R O W T H I N V O L U M E S A N D REVENUE DUE TO TEAM, BRAND & E X E C U T I O N C A PA B I L I T I E S Total Transaction Total Revenues(2) Diluted EPS Adjusted EBITDA(2)(3) Volume(1) $11,356 $1.49 $66,684 $234,157 $64,129 $1.39 $187,437 $5,941 Q1'19 Q1'20 Q1'19 Q1'20 Q1'19 Q1'20 Q1
Slide 5: Multifamily Focus of Debt Brokerage Team Supports Future Agency Lending
M U LT I FA M I LY F O C U S O F D E B T B R O K E R A G E T E A M S U P P O RT S F U T U R E AGENCY LENDING Total Debt Brokerage Volume Total Debt Brokerage Volume by Property Type (in millions) $10,364 2% 7% 1% 5% 2% 3% 8% $8,398 9% 7% 12% 8% 15% 61% 52% 2018 2019 2018 2019 Multifamily Industrial
Slide 6: Healthy Key Financial Metrics
H E A LT H Y K E Y F I N A N C I A L M E T R I C S Operating Margin Return on Equity Gain on Sale Margin 30% 1.90% 20% 19% 26% 1.51% 0.79% 0.71% Gains attributable to MSRs Origination related fees 1.11% 0.79% Q1'19 Q1'20 Q1'19 Q1'20 Q1'19 Q1'20 6
Slide 7: Servicing Portfolio Continues to Fuel Cash Generation
S E RV I C I N G P O RT F O L I O C O N T I N U E S T O F U E L C A S H G E N E R AT I O N > As of March 31, 2020, the servicing portfolio had a weighted average remaining life of 9.5 years and a weighted average servicing fee of 23.3 bps > Over the next two years, only $4.5 billion of Agency loans
Slide 8: Limited Historical Write Offs Due to Strong Portfolio Fundamentals
LIMITED HISTORICAL WRITE OFFS D U E TO S T R O N G P O RT F O L I O F U N D A M E N TA L S > During the Great Financial Crisis, we experienced peak 60+ day delinquencies in Q2’10 of 1.64% of the at risk servicing portfolio > Peak losses of 0.06% of the at risk portfolio did not occur until 2012 Key
Slide 9: Strong Liquidity Position Supports Advance Obligations
STRONG LIQUIDITY POSITION S U P P O R T S A D VA N C E O B L I G AT I O N S > Under the terms of our Fannie Mae and Ginnie loan servicing agreements, we are obligated to advance mortgage payments to bondholders for loans that are granted forbearance. We do not have advance obligations for any other
Slide 10: Significant GSE Lending Capacity Remaining in 2020
SIGNIFICANT GSE LENDING C A PA C I T Y R E M A I N I N G I N 2 0 2 0 > The current FHFA scorecard sets Fannie Mae and Freddie Mac’s multifamily lending capacity at $100 billion each through five quarters ending Q4’20 > After a combined $24 billion of business in Q1’20, Fannie and Freddie have approx
Slide 11: Appendix
APPENDIX 11
Slide 12: Adjusted EBITDA Reconciliation to Net Income
ADJUSTED EBITDA R E C O N C I L I AT I O N T O N E T I N C O M E For the three months ended March 31 2020 2019 (in thousands) Walker & Dunlop Net Income $47,829 $44,218 Adjustments: Income tax expense 12,672 12,024 Interest expense on corporate debt 2,860 3,652 Amortization and depreciation 39,762 3
Slide 13: Contact details
Phone 301.215.5500 7501 Wisconsin Avenue, Suite 1200E Bethesda, Maryland 20814