In a Q3 2024 earnings call Nov. 7, Anywhere Real Estate reported financial results for the third quarter ended September 30, 2024, which included earnings of $7 million but sales falling 3.1% year on year to $1.54 billion. On a per-share basis, the Madison, New Jersey-based company said it had profit of 6 cents. Earnings, adjusted for one-time gains and costs, were 5 cents per share. The real estate brokerage operator posted revenue of $1.54 billion in the period.
“I am proud of our third quarter performance as Anywhere delivered strong Operating EBITDA and free cash flow, invested meaningfully in the business for future growth, gained luxury share, and strengthened our balance sheet,” said Ryan Schneider, Anywhere president and CEO. “Anywhere stands out because of our strategic strengths and profitability, along with our outstanding affiliated agents, franchisees and employees who continue to deliver great value to consumers as we move real estate to what’s next.”
“Anywhere delivered differentiated profitability, optimized our balance sheet, and drove efficiencies to fuel even greater financial octane and flexibility for the future,” said Charlotte Simonelli, Anywhere executive vice president, chief financial officer, and treasurer. “We are capitalizing on this moment to accelerate our strategic progress, invest in our future, and set Anywhere up for growth and further competitive differentiation as the housing market improves.”
2024 Financial Estimates
Anywhere is expecting to realize $120 million in cost savings in 2024. The company expects its free cash flow excluding one-time items to be approximately $100 million in 2024. The one-time items are estimated to be approximately $60 million, and consist of a $20 million payment towards our antitrust litigation settlement and approximately $39 million for a 1999 Cendant legacy tax matter.
The Burnett antitrust litigation settlement totaled $83.5 million, $10 million of which was paid in the fourth quarter of 2023 and $20 million of which was paid in the second quarter of 2024. The remaining $53.5 million will be due when appeals are resolved, the timing of which is uncertain. Anywhere expect the payment to occur no earlier than mid-2025.
The approximately $39 million 1999 Cendant legacy tax matter will be due once statutory notice is received, which Anywhere assumed will occur in 2024.
Q3 highlights
- Generated revenue of $1.5 billion, a decrease of 3% year-over-year.
- Combined closed transaction volume remained at year-over-year in the third quarter with units down 5% and price up 6%.
- Anywhere’s strength in luxury continued as Corcoran and Sotheby’s International Realty brands outperformed the market, with 5% transaction volume growth in the third quarter, including growing luxury unit share year-over-year.
- Reported net income of $7 million decreased $122 million primarily driven by lapping gains on the early extinguishment of debt which were $7 million during the third quarter of 2024 compared to $169 million during the same period last year. Adjusted net income of $6 million decreased $11 million versus 2023.
- Operating EBITDA of $94 million, a $13 million decrease year-over-year.
- Realized cost savings of approximately $30 million and on track to realize full year cost savings of $120 million.
- Agent commission splits in the third quarter were up 15 basis points year-over-year to 80.4%, but down versus the prior quarter. It is the 10th straight quarter of stable commission splits at approximately 80%.
- Free cash flow of $99 million versus $95 million for the corresponding quarter last year. The company repaid its $196 million Term Loan A and repurchased $26 million of unsecured notes for $19 million, capturing $7 million of discount.
- The company’s preliminary October 2024 closed transaction volume was up approximately 9% year-over-year and October open transaction volume, which represents new contracts and future closings, was up approximately 16% year-over-year.
