|
|
|
(State or other jurisdiction of incorporation)
|
(Commission File Number)
|
(IRS Employer Identification No.)
|
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
|
Soliciting material pursuant to Rule 14a−12 under the Exchange Act (17 CFR 240.14a−12)
|
Pre−commencement communications pursuant to Rule 14d−2(b) under the Exchange Act (17 CFR 240.14d−2(b))
|
Pre−commencement communications pursuant to Rule 13e−4(c) under the Exchange Act (17 CFR 240.13e− 4(c))
|
Title of each class
|
Trading Symbol
|
Name of each exchange on which registered
|
||
|
(The Nasdaq Global Select Market)
|
Item 2.02 |
Results of Operations and Financial Condition.
|
Item 8.01 |
Other Events.
|
Item 9.01 |
Financial Statements and Exhibits.
|
Exhibit No.
|
Description
|
|
Earnings release dated May 12, 2022.
|
||
Investor presentation materials dated May 12, 2022.
|
||
104
|
The cover page from this Current Report on Form 8-K, formatted in Inline XBRL.
|
HOME POINT CAPITAL INC.
|
||
Date: May 12, 2022
|
||
By:
|
/s/ Mark E. Elbaum
|
|
Name:
|
Mark E. Elbaum
|
|
Title:
|
Chief Financial Officer
|
($mm, except per share values)
|
For the quarter ended
|
|||||||||||
3/31/2022
|
12/31/2021
|
3/31/2021
|
||||||||||
Total Funded Origination Volume
|
$
|
12,555.1
|
$
|
20,516.0
|
$
|
29,425.9
|
||||||
Total Fallout Adjusted Lock Volume
|
$
|
12,589.1
|
$
|
17,332.7
|
$
|
23,552.8
|
||||||
Gain on sale margin (bps)1
|
58
|
59
|
147
|
|||||||||
Servicing portfolio - Units
|
349,261
|
425,989
|
396,641
|
|||||||||
Servicing portfolio - UPB
|
$
|
101,984.8
|
$
|
128,359.6
|
$
|
105,821.4
|
||||||
Total revenue, net
|
$
|
158.2
|
$
|
180.5
|
$
|
421.9
|
||||||
Origination segment direct expenses
|
81.2
|
101.2
|
159.3
|
|||||||||
Servicing segment direct expenses
|
15.8
|
15.9
|
18.7
|
|||||||||
Corporate expenses
|
39.7
|
35.1
|
49.0
|
|||||||||
Total expenses
|
136.7
|
152.2
|
227.0
|
|||||||||
Net income
|
$
|
11.9
|
$
|
19.3
|
$
|
149.0
|
||||||
Net income per share
|
$
|
0.09
|
$
|
0.14
|
$
|
1.07
|
• |
Quarterly funded origination volume was $12.6 billion, compared to $29.4 billion in the first quarter of 2021, and $20.5 billion in the fourth quarter of 2021.
|
• |
Total revenue, net of $158.2 million, compared to $421.9 million in the first quarter of 2021 and $180.5 million in the fourth quarter of 2021.
|
• |
Total revenue in the Origination segment of $72.8 million, compared to $346.6 million in the first quarter of 2021 and $102.9 million in the fourth quarter of 2021.
|
• |
Gain on sale margin attributable to channels, before giving effect to the impact of capital markets and other activity, was 61 basis points in the first quarter of 2022, compared to 125 basis points in the first quarter of 2021 and 58
basis points in the fourth quarter of 2021.
|
• |
Total expenses of $136.7 million for the first quarter of 2022 improved 39.8% versus the first quarter of 2021 and were 10.2% lower compared to the fourth quarter of 2021. The sequential
quarter improvement was due to a 19.8% reduction in Origination segment direct expenses.
|
• |
Net Income of $11.9 million (or $0.08 per diluted share), compared to net income of $149.0 million (or $1.07 per diluted share) in the first quarter of 2021, and net income of $19.3 million (or $0.14 per
diluted share) in the fourth quarter of 2021.
|
• |
Broker Partners of 8,376 as of March 31, 2022 increased by 2,353 from the end of the first quarter of 2021, and increased by 364 from the end of the fourth quarter of 2021.
|
• |
In the first quarter of 2022, we had 3,603 active broker partners, an increase of 3.5% from the fourth quarter and up over 24.1% from the prior year.
|
• |
During the quarter, Homepoint completed sales of mortgage servicing rights (“MSR”) portfolios of single-family mortgage loans for a total purchase price of approximately $434.5 million.
|
• |
Servicing customers of 349,261, down 11.9% from the first quarter of 2021, and down 18.0% compared to the fourth quarter of 2021.
|
• |
Servicing portfolio UPB totaled $102.0 billion as of March 31, 2022, down 3.6% from the end of the first quarter of 2021, and a reduction of 20.5% from year end 2021.
|
• |
Total servicing portfolio delinquencies of 0.8%, compared to 2.7% in the first quarter of 2021 and 0.7% in the fourth quarter of 2021, primarily due to the servicing portfolio sales in the third and fourth quarters of 2021 and first
quarter of 2022, and growth in new servicing customers. The MSR multiple for the first quarter of 2022 of 5.6x increased from 3.8x in the first quarter of 2021 and 4.6x in the fourth quarter of 2021, primarily driven by slower prepayment
speeds due to higher mortgage interest rates.
|
($mm)
|
For the quarter ended
|
|||||||||||
3/31/2022
|
12/31/2021
|
3/31/2021
|
||||||||||
Gain on loans, net
|
$
|
45.4
|
$
|
64.2
|
$
|
301.2
|
||||||
Loan fee income
|
19.9
|
32.8
|
44.1
|
|||||||||
Interest income, net and other income
|
7.5
|
5.9
|
1.3
|
|||||||||
Total Origination segment revenue
|
72.8
|
102.9
|
346.6
|
|||||||||
Directly attributable expense
|
81.2
|
101.2
|
159.3
|
|||||||||
Contribution margin
|
$
|
(8.4
|
)
|
$
|
1.7
|
$
|
187.3
|
|||||
Key
Performance Indicators1
|
For the quarter ended
|
|||||||||||
3/31/2022
|
12/31/2021
|
3/31/2021
|
||||||||||
Total Funded Origination Volume
|
$
|
12,555.1
|
$
|
20,516.0
|
$
|
29,425.9
|
||||||
Total Fallout Adjusted Lock Volume
|
$
|
12,589.1
|
$
|
17,332.7
|
$
|
23,552.8
|
||||||
Gain on Sale Margin (bps)2
|
58
|
59 |
147
|
|||||||||
Origination Volume by Purpose:
|
||||||||||||
Purchase
|
44.4
|
%
|
37.5
|
%
|
20.4
|
%
|
||||||
Refinance
|
55.6
|
%
|
62.5
|
%
|
79.6
|
%
|
||||||
Third Party Partners:
|
||||||||||||
Number of Broker Partners
|
8,376
|
8,012
|
6,023
|
|||||||||
Number of Correspondent Partners
|
669
|
676
|
620
|
($mm)
|
For the quarter ended
|
|||||||||||
3/313/2022
|
12/31/2021
|
3/31/2021
|
||||||||||
Loan servicing fees
|
$
|
81.1
|
$
|
83.6
|
$
|
70.3
|
||||||
Interest income, net and other income
|
0.7
|
0.4
|
0.4
|
|||||||||
Total Servicing segment revenue
|
81.8
|
84.0
|
70.7
|
|||||||||
Directly attributable expense
|
15.8
|
15.9
|
18.7
|
|||||||||
Primary Margin
|
66.0
|
68.1
|
52.0
|
|||||||||
Change in MSR fair value: amortization
|
(49.0
|
)
|
(66.7
|
)
|
(89.2
|
)
|
||||||
Adjusted contribution margin
|
17.1
|
1.4
|
(37.2
|
)
|
||||||||
Change in MSR fair value: mark-to-market, net of hedge1
|
66.1
|
73.0
|
102.0
|
|||||||||
Contribution margin
|
$
|
83.2
|
$
|
74 |
$
|
64.8
|
||||||
Key Performance Indicators
|
For the quarter ended2
|
|||||||||||
3/31/2022
|
12/31/2021
|
3/31/2021
|
||||||||||
MSR servicing portfolio - UPB
|
$
|
101,985
|
$
|
128,360
|
$
|
105,821
|
||||||
Average MSR servicing portfolio - UPB
|
$
|
115,172
|
$
|
127,096
|
$
|
97,049
|
||||||
MSR servicing portfolio - Units
|
349,261
|
425,989
|
396,641
|
|||||||||
Weighted average coupon rate
|
3.00
|
%
|
2.96
|
%
|
3.19
|
%
|
||||||
60+ days delinquent, incl. forbearance
|
0.8
|
%
|
0.7
|
%
|
2.7
|
%
|
||||||
MSR multiple
|
5.6
|
4.6
|
3.8
|
($mm)
|
As of
|
|||||||
3/31/2022
|
12/31/2021
|
|||||||
Cash and cash equivalents
|
$
|
160.7
|
$
|
171.0
|
||||
Mortgage servicing rights (at fair value)
|
$
|
1,490.2
|
$
|
1,525.1
|
||||
Warehouse lines of credit
|
$
|
2,724.9
|
$
|
4,718.7
|
||||
Term debt and other borrowings, net
|
$
|
942.2
|
$
|
1,226.5
|
||||
Total shareholders' equity
|
$
|
783.2
|
$
|
776.6
|
($mm, except per share values)
|
For the quarter ended
|
|||||||||||
3/31/2022
|
12/31/2021
|
3/31/2021
|
||||||||||
Gain on loans, net
|
$
|
45.4
|
$
|
64.0
|
$
|
301.2
|
||||||
Loan fee income
|
19.9
|
32.8
|
44.1
|
|||||||||
Interest income
|
27.1
|
39.5
|
25.6
|
|||||||||
Interest expense
|
(33.1
|
)
|
(46.8
|
)
|
(32.9
|
)
|
||||||
Interest expense, net
|
(6.0
|
)
|
(7.3
|
)
|
(7.3
|
)
|
||||||
Loan servicing fees
|
81.1
|
83.6
|
70.3
|
|||||||||
Change in fair value of mortgage servicing rights
|
17.2
|
6.3
|
|
12.8
|
||||||||
Other income
|
0.6
|
1.1
|
0.8
|
|||||||||
Total revenue, net
|
158.2
|
180.5
|
421.9
|
|||||||||
Compensation and benefits
|
89.4
|
98.7
|
153.6
|
|||||||||
Loan expense
|
9.0
|
12.1
|
17.7
|
|||||||||
Loan servicing expense
|
5.7
|
5.1
|
8.1
|
|||||||||
Production technology
|
4.9
|
6.8
|
9.3
|
|||||||||
General and administrative
|
19.7
|
20.9
|
26.2
|
|||||||||
Depreciation and amortization
|
2.7
|
2.6
|
2.8
|
|||||||||
Other expenses
|
5.3
|
6.0
|
9.3
|
|||||||||
Total expenses
|
136.7
|
152.2
|
227.0
|
|||||||||
Income before income tax
|
21.5
|
28.3
|
194.9
|
|||||||||
Pre-tax margin
|
13.6
|
%
|
15.7
|
%
|
46.2
|
%
|
||||||
Income tax expense
|
$
|
(4.3
|
)
|
$
|
(7.7
|
)
|
$
|
(50.1
|
)
|
|||
(Loss) income from equity method investment
|
$
|
(5.3
|
)
|
$
|
(1.3
|
)
|
$
|
4.2
|
||||
Net income
|
$
|
11.9
|
$
|
19.3
|
$
|
149.0
|
||||||
Net margin
|
7.5
|
%
|
10.7
|
%
|
35.3
|
%
|
||||||
Earnings per share:
|
||||||||||||
Basic
|
$
|
0.09
|
$
|
0.14
|
$
|
1.07
|
||||||
Diluted
|
$
|
0.08
|
$
|
0.14
|
$
|
1.07
|
||||||
Basic weighted average common stock outstanding (mm)
|
139.2
|
139.1
|
138.9
|
|||||||||
Diluted weighted average common stock outstanding (mm)
|
140.6
|
140.8
|
139.7
|
|||||||||
Adjusted income statement metrics 1:
|
||||||||||||
Adjusted revenue
|
$
|
86.8
|
$
|
106.2
|
$
|
324.1
|
||||||
Adjusted net income
|
$
|
(41.0
|
)
|
$
|
(33.8
|
)
|
$
|
73.2
|
||||
Adjusted net margin
|
(47.2
|
)%
|
(31.9
|
)%
|
22.6
|
%
|
($mm)
|
As of
|
|||||||
3/31/2022
|
12/31/2021
|
|||||||
Assets:
|
||||||||
Cash and cash equivalents
|
$
|
160.7
|
$
|
171.0
|
||||
Restricted cash
|
37.0
|
36.8
|
||||||
Cash and cash equivalents and Restricted cash
|
197.7
|
207.8
|
||||||
Mortgage loans held for sale (at fair value)
|
2,889.0
|
5,107.1
|
||||||
Mortgage servicing rights (at fair value)
|
1,490.2
|
1,525.1
|
||||||
Property and equipment, net
|
21.4
|
21.9
|
||||||
Accounts receivable, net
|
218.0
|
129.1
|
||||||
Derivative assets
|
183.5
|
84.4
|
||||||
Goodwill
|
10.8
|
10.8
|
||||||
Government National Mortgage Association loans eligible for repurchase
|
81.3
|
65.2
|
||||||
Assets held for sale
|
58.4
|
63.7
|
||||||
Other assets
|
48.7
|
43.2
|
||||||
Total assets
|
$
|
5,199.0
|
$
|
7,258.3
|
||||
Liabilities and Shareholders’ Equity:
|
||||||||
Warehouse lines of credit
|
2,724.9
|
4,718.7
|
||||||
Term debt and other borrowings, net
|
942.2
|
1,226.5
|
||||||
Accounts payable and accrued expenses
|
135.5
|
138.2
|
||||||
Government National Mortgage Association loans eligible for repurchase
|
81.3
|
65.2
|
||||||
Deferred tax liabilities
|
232.7
|
229.8
|
||||||
Derivative liabilities
|
219.4
|
26.7
|
||||||
Other liabilities
|
79.8
|
76.6
|
||||||
Total liabilities
|
4,415.8
|
6,481.7
|
||||||
Shareholders’ Equity:
|
||||||||
Common stock
|
—
|
—
|
||||||
Additional paid in capital
|
525.6
|
523.8
|
||||||
Retained earnings
|
259.1
|
252.8
|
||||||
Treasury stock
|
(1.5
|
)
|
—
|
|||||
Total shareholders' equity
|
783.2
|
776.6
|
||||||
Total liabilities and shareholders' equity
|
$
|
5,199.0
|
$
|
7,258.3
|
VOLUME DETAIL BY CHANNEL
|
||||||||||||
($mm)
|
For the quarter ended
|
|||||||||||
3/31/2022
|
12/31/2021
|
3/31/2021
|
||||||||||
Funded Origination Volume by Channel
|
||||||||||||
Wholesale
|
$
|
9,317.7
|
$
|
15,046.9
|
$
|
19,668.3
|
||||||
Correspondent
|
2,733.3
|
4,500.0
|
8,243.4
|
|||||||||
Direct
|
504.1
|
969.3
|
1,514.3
|
|||||||||
Total Funded Origination Volume
|
$
|
12,555.1
|
$
|
20,516.2
|
$
|
29,426.0
|
||||||
Fallout Adjusted Lock Volume by Channel
|
||||||||||||
Wholesale
|
$
|
9,563.7
|
$
|
12,605.7
|
$
|
16,139.9
|
||||||
Correspondent
|
2,610.8
|
4,042.1
|
6,673.1
|
|||||||||
Direct
|
414.6
|
684.8
|
739.8
|
|||||||||
Total Fallout Adjusted Lock Volume
|
$
|
12,589.1
|
$
|
17,332.6
|
$
|
23,552.8
|
($mm)
|
For the quarter ended
|
|||||||||||||||||||||||
3/31/2022
|
12/31/2021
|
3/31/2021
|
||||||||||||||||||||||
$ Amount
|
Basis Points
|
$ Amount
|
Basis Points
|
$ Amount
|
Basis Points
|
|||||||||||||||||||
Gain on Sale Margin by Channel
|
||||||||||||||||||||||||
Wholesale
|
$
|
62.6
|
65
|
$
|
76.4
|
61
|
$
|
245.1
|
152
|
|||||||||||||||
Correspondent
|
3.5
|
13
|
$
|
7.4
|
18
|
22.2
|
33
|
|||||||||||||||||
Direct
|
10.7
|
258
|
$
|
17.5
|
256
|
26.8
|
362
|
|||||||||||||||||
Margin Attributable to Channels
|
76.8
|
61
|
$
|
101.3
|
58
|
294.1
|
125
|
|||||||||||||||||
Other (Loss) Gain on Sale1
|
(4.0
|
)
|
(3
|
)
|
$
|
1.6
|
1
|
52.7
|
22
|
|||||||||||||||
Gain on Sale Margin2
|
$
|
72.8
|
58
|
$
|
102.9
|
59
|
$
|
346.8
|
147
|
($mm)
|
For the quarter March 31, 2022
|
|||||||||||||||||||||||||||
Origination
|
Servicing
|
Segments
Total
|
All Other
|
Total
|
Reconciliat
ion Item1
|
Segments
Total
|
||||||||||||||||||||||
Revenue:
|
||||||||||||||||||||||||||||
Gain on loans, net
|
$
|
45.4
|
$
|
—
|
$
|
45.4
|
$
|
—
|
$
|
45.4
|
$
|
—
|
$
|
45.4
|
||||||||||||||
Loan fee income
|
19.9
|
—
|
19.9
|
—
|
19.9
|
—
|
19.9
|
|||||||||||||||||||||
Loan servicing fees
|
—
|
81.1
|
81.1
|
—
|
81.1
|
—
|
81.1
|
|||||||||||||||||||||
Change in fair value of mortgage servicing rights2
|
—
|
17.2
|
17.2
|
—
|
17.2
|
—
|
17.2
|
|||||||||||||||||||||
Interest expense (income), net
|
7.5
|
0.7
|
8.2
|
(14.2
|
)
|
(6.0
|
)
|
—
|
(6.0
|
)
|
||||||||||||||||||
Other income (expense)
|
—
|
—
|
—
|
(4.7
|
)
|
(4.7
|
)
|
5.3
|
0.6
|
|||||||||||||||||||
Total Revenue
|
$
|
72.8
|
$
|
99.0
|
$
|
171.8
|
$
|
(18.9
|
)
|
$
|
152.9
|
$
|
5.3
|
$
|
158.2
|
|||||||||||||
Contribution margin
|
$
|
(8.4
|
)
|
$
|
83.2
|
$
|
74.8
|
$
|
(58.7
|
)
|
$
|
16.1
|
($mm)
|
For the quarter December 31, 2021
|
|||||||||||||||||||||||||||
Origination
|
Servicing
|
Segments
Total
|
All Other
|
Total
|
Reconcili
ation Item1
|
Segments
Total
|
||||||||||||||||||||||
Revenue:
|
||||||||||||||||||||||||||||
Gain on loans, net
|
$
|
64.2
|
$
|
(0.2
|
)
|
$
|
64.0
|
$
|
—
|
$
|
64.0
|
$
|
—
|
$
|
64.0
|
|||||||||||||
Loan fee income
|
32.8
|
—
|
32.8
|
—
|
32.8
|
—
|
32.8
|
|||||||||||||||||||||
Loan servicing fees
|
—
|
83.6
|
83.6
|
—
|
83.6
|
—
|
83.6
|
|||||||||||||||||||||
Change in fair value of mortgage servicing rights2
|
—
|
6.3
|
6.3
|
—
|
6.3
|
—
|
6.3
|
|||||||||||||||||||||
Interest income (expense), net
|
5.9
|
0.6
|
6.5
|
(13.8
|
)
|
(7.3
|
)
|
—
|
(7.3
|
)
|
||||||||||||||||||
Other income (expense)
|
—
|
—
|
—
|
(0.2
|
)
|
(0.2
|
)
|
1.3
|
1.1
|
|||||||||||||||||||
Total Revenue
|
$
|
102.9
|
$
|
90.3
|
$
|
193.2
|
$
|
(14.0
|
)
|
$
|
179.2
|
$
|
1.3
|
$
|
180.5
|
|||||||||||||
Contribution margin
|
$
|
1.7
|
$
|
74.4
|
$
|
76.1
|
$
|
(50.6
|
)
|
$
|
25.5
|
($mm)
|
For the quarter March 31, 2021
|
|||||||||||||||||||||||||||
Origination
|
Servicing
|
Segments
Total
|
All Other
|
Total
|
Reconciliat
ion Item1
|
Segments
Total |
||||||||||||||||||||||
Revenue:
|
||||||||||||||||||||||||||||
Gain on loans, net
|
$
|
301.2
|
$
|
—
|
$
|
301.2
|
$
|
—
|
$
|
301.2
|
$
|
—
|
$
|
301.2
|
||||||||||||||
Loan fee income
|
$
|
44.1
|
$
|
—
|
$
|
44.1
|
$
|
—
|
$
|
44.1
|
$
|
—
|
$
|
44.1
|
||||||||||||||
Loan servicing fees
|
$
|
—
|
$
|
70.3
|
$
|
70.3
|
$
|
—
|
$
|
70.3
|
$
|
—
|
$
|
70.3
|
||||||||||||||
Change in fair value of mortgage servicing rights
|
$
|
—
|
$
|
12.8
|
$
|
12.8
|
$
|
—
|
$
|
12.8
|
$
|
—
|
$
|
12.8
|
||||||||||||||
Interest income (expense), net
|
$
|
1.3
|
$
|
0.3
|
$
|
1.6
|
$
|
(8.9
|
)
|
$
|
(7.3
|
)
|
$
|
—
|
$
|
(7.3
|
)
|
|||||||||||
Other income (expense)
|
$
|
—
|
$
|
0.1
|
$
|
0.1
|
$
|
4.8
|
$
|
4.9
|
$
|
(4.1
|
)
|
$
|
0.8
|
|||||||||||||
Total Revenue
|
$
|
346.6
|
$
|
83.5
|
$
|
430.1
|
$
|
(4.1
|
)
|
$
|
426.0
|
$
|
(4.1
|
)
|
$
|
421.9
|
||||||||||||
Contribution margin
|
$
|
187.3
|
$
|
64.8
|
$
|
252.1
|
$
|
(53.0
|
)
|
$
|
199.1
|
($mm)
|
For the quarter ended
|
|||||||||||
3/31/2022
|
12/31/2021
|
3/31/2021
|
||||||||||
Total revenue, net
|
$
|
158.2
|
$
|
180.5
|
$
|
421.9
|
||||||
(Loss) income from equity method investment
|
(5.3
|
)
|
(1.3
|
)
|
4.2
|
|||||||
Change in fair value of MSR, net of hedge
|
(66.1
|
)
|
(73.0
|
)
|
(102.0
|
)
|
||||||
Adjusted revenue
|
$
|
86.8
|
$
|
106.2
|
$
|
324.1
|
($mm)
|
For the quarter ended
|
|||||||||||
3/31/2022
|
12/31/2021
|
3/31/2021
|
||||||||||
Total net income
|
$
|
11.9
|
$
|
19.3
|
$
|
149.0
|
||||||
Change in fair value of MSR, net of hedge
|
(66.1
|
)
|
(73.0
|
)
|
(102.0
|
)
|
||||||
Income tax effect of change in fair value of MSR, net of hedge
|
13.2
|
19.9
|
26.2
|
|||||||||
Adjusted net (loss) income
|
$
|
(41.0
|
)
|
$
|
(33.8
|
)
|
$
|
73.2
|
($mm)
|
For the quarter ended
|
|||||||||||
3/31/2022
|
12/31/2021
|
3/31/2021
|
||||||||||
Total revenue, net
|
$
|
158.2
|
$
|
180.5
|
$
|
421.9
|
||||||
Total net income
|
11.9
|
19.3
|
149.0
|
|||||||||
Net margin
|
7.5
|
%
|
10.7
|
%
|
35.3
|
%
|
||||||
Adjusted revenue
|
$
|
86.8
|
$
|
106.2
|
$
|
324.1
|
||||||
Adjusted net (loss) income
|
(41.0
|
)
|
(33.8
|
)
|
73.2
|
|||||||
Adjusted net margin
|
(47.2
|
) %
|
(31.9
|
) %
|
22.6
|
%
|