Anywhere Real Estate reported revenue of $1.6 billion and a profit of $129 million for the third quarter, ending with $151 million in cash and cash equivalents.
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Anywhere, the world’s largest real estate franchisor, clung to profitability for the second-straight quarter despite posting a 12 percent decline in annual revenue as transaction volume spiraled, according to Q3 earnings data released Tuesday.
The world’s largest franchisor of real estate brands — including Century 21, Coldwell Banker and Better Homes and Gardens Real Estate — reported a profit of $129 million for the third quarter. Revenues fell to $1.6 billion, from $1.7 billion in the second quarter, according to earnings data released Tuesday.
The company ended the quarter with cash and cash equivalents of $151 million, and free cash flow of $95 million, according to the earnings report. It also saw its commission splits increase 55 basis points year over year during the quarter.
“Anywhere led through a difficult housing market to deliver considerable profitability and achieve substantial debt reduction,” said Ryan Schneider, Anywhere president and CEO. “We accelerated our strategic progress, including expanding our high-margin franchise business, integrating the consumer transaction experience, taking advantage of the better competitive environment, and putting significant litigation behind us, to set Anywhere up for powerful momentum as the housing market improves.”
Markets reacted positively to the earnings news, with Anywhere’s stock price increasing by over 5 percent at opening. The third quarter saw Anywhere announce the details of its settlement in the bombshell Sitzer/Burnett commission lawsuit, which included an $83.5 million payout. The company’s stock slid 2.8 percent as a result of the announcement.
Anywhere says it reduced its debt by $281 million during the third quarter through debt exchanges, bond repurchases, and repayment of a portion of its revolver balance. In the second quarter, the firm announced that it had entered into a debt exchange agreement with the investment manager Angelo Gordon and that it intended to deliver $200 million in cost savings for the full year, having already delivered $100 million at the halfway point.
“Anywhere stayed focused on what we can control and drove differentiated results in the third quarter,” said Charlotte Simonelli, Anywhere’s chief financial officer and treasurer. “We generated meaningful Operating EBITDA, over-delivered on our cost savings agenda, achieved sizable debt reduction, and prudently managed our cash, enabling Anywhere to navigate current market conditions and invest to drive future success.”
The company predicted full-year 2023 transaction volumes would decline 15 percent to 20 percent year over year due to the weaker market brought on by high mortgage rates. It also predicted however that its full-year commission splits would increase about 50 to 60 basis points above 2022, and that it would realize cost savings of approximately $200 million by the end of 2023.