Realogy Matches Biggest Quarter In Company History
Transaction volume for Realogy’s brands soared in the fourth quarter, climbing 45 percent year over year, according to an earnings report issued Tuesday.
The housing blitz that accompanied the COVID-19 pandemic propelled Realogy to new heights in 2020, with the company closing the year with a fourth quarter that boasted $1.9 billion in revenue, a sum that matched the previous quarter, an all-time high for the company. Revenue was up 36 percent, or nearly $500 million, from the fourth quarter of 2019.
For the entire year, Realogy posted $6.2 billion in revenue, an increase of 6 percent from the year prior. The modest increase despite two record-setting quarters is due to the second quarter COVID-19 induced pause that briefly hit the housing market.
“In an extraordinary year, we were able to capitalize on the dynamic housing market, accelerate our strategic progress, and capture significant incremental transaction economics,” Realogy CEO Ryan Schneider said in a statement. “With our strategic success and strong momentum, we believe Realogy is well-positioned to lead into the future. 2021 is off to a very strong start, and we are excited as we look ahead.”
The company also saw transaction volume accelerate. Combined transaction volume for the company’s own-side and franchise business soared 45 percent year-over-year in the fourth quarter.
For the full year, Realogy’s total market share held steady at 15.3 percent, maintaining its position as the industry’s largest real estate holding company in terms of total market share.
The company posted $572 billion in closed transaction volume for the entire year, a reflection of how hot the housing market is, considering the industry’s largest company could see volume boom and, yet, merely maintain its position as competitors experienced similar transaction surges.
Despite the soaring transaction volume, the company’s profit shrank from the previous quarter but was still far ahead of last year’s fourth-quarter loss. Realogy reported $18 million in net income in the quarter and a basic earnings per share of $0.16.
Reported Net income of $18 million and basic earnings per share of $0.16, an increase of $63 million vs. prior year or $0.55 per share.
The company’s operating earnings before interest taxes depreciation and amortization (EBITDA) increased 23 percent — or $136 million — year over year. The jump was driven by strong performances in mortgage and title, as well as the transaction volume increases and the company’s own strategic initiatives and cost management, Realogy said in a release.
Part of those strategic initiatives includes debt management, which has been a major focus of the company since Schneider took the reigns as CEO. The company reduced net debt by approximately $500 million in 2020 and the company’s leverage ratio is the lowest since the company went public in 2012.
“2020 was a year of tremendous operational and financial execution for Realogy,” Charlotte Simonelli, Realogy’s executive vice president, chief financial officer, and treasurer. said in a statement.
“In the year we delivered top-line growth, cost efficiencies, impressive profitability, and greater simplification while continuing to invest in the business,” Simonelli added. “We seized market opportunities to improve our capital structure, including significantly reducing net debt and net leverage, which further strengthened Realogy’s financial profile.”