Altisource Portfolio Solutions SA (ASPS, Financial), a leading provider and marketplace for the real estate and mortgage industries, announced its financial results for the third quarter of 2023 on October 26, 2023. The company reported an Adjusted EBITDA of $874 thousand, marking a significant improvement over the previous quarters. This figure represents a $4.4 million improvement over Q2 2023 and a $7.3 million improvement over Q3 2022.
Financial Highlights
For the first nine months of 2023, ASPS improved its Adjusted EBITDA by $16.1 million compared to the same period last year. The company also generated $18.4 million in net proceeds from the September sale of equity and used $10 million of the proceeds to reduce the principal balance of its term loan. As a result of the debt reduction, the company eliminated 966,038 penny warrants and estimates it will save approximately $3.4 million per year in interest expense.
ASPS ended Q3 2023 with $36.6 million of cash and cash equivalents and $15.0 million available under a revolving credit facility. The company also reported a net debt of $185.3 million at the end of Q3 2023.
Operational Performance and Future Outlook
ASPS reported a service revenue of $34.1 million and a net loss attributable to Altisource of $(11.3) million for Q3 2023. Despite the net loss, the company's CEO, William B. Shepro, expressed satisfaction with the company's performance and optimism about its future prospects. He stated,
We are positioning Altisource to take advantage of what we see as significant potential opportunities with existing and new customers in both of our segments over the coming years as the default market continues to normalize and we gain traction with our newer solutions that strengthen loan originators’ performance."
ASPS is also implementing a company-wide cost reduction plan, which is estimated to reduce annual cash operating expenses by $13.5 million once complete. The company believes it is on track to achieve the plan with September 2023 adjusted compensation costs approximately $0.9 million ($10.5 million annualized) lower than the average second quarter costs.
Financial Tables Summary
The company's financial tables reveal a year-to-date service revenue of $104.3 million, a 7% decrease compared to the same period in 2022. The loss from operations improved by 52% to $(13.9) million. The net loss attributable to Altisource was $(43.1) million, a 3% increase from the previous year. The diluted loss per share improved by 20% to $(2.10).
Overall, the financial results indicate that while ASPS is still operating at a loss, it has made significant strides in improving its financial performance and reducing its debt. The company's strategic initiatives and cost reduction plan are expected to further enhance its financial health and position it for future growth.
Explore the complete 8-K earnings release (here) from Altisource Portfolio Solutions SA for further details.
