The apartment lightning that came with the COVID-19 pandemic took Realogy to a new level in 2020. The company ended the year on a fourth quarter with revenues of $ 1.9 billion for the company. Revenue increased 36 percent, or nearly $ 500 million, from the fourth quarter of 2019.
For the full year, Realogy had sales of $ 6.2 billion, an increase of 6 percent over the previous year. The modest increase despite two record quarters is due to the pause in the second quarter caused by COVID-19, which briefly hit the real estate market.
“In an exceptional year, we have benefited from the dynamic real estate market, accelerated our strategic progress and achieved significant incremental transaction economy,” said Ryan Schneider, CEO of Realogy, in a statement. “With our strategic success and strong momentum, we believe Realogy is well positioned to lead into the future. The year 2021 got off to a very good start and we are excited to see how we look ahead. “
The company also saw an acceleration in transaction volume. The combined transaction volume for the company’s own company and the franchise business increased by 45 percent in the fourth quarter compared to the previous year.
Throughout the year, Realogy’s total market share remained constant at 15.3 percent and maintained its position as the largest real estate holding company in the industry based on total market share.
The company had closed transaction volumes of $ 572 billion for the year. This reflects how hot the real estate market is, considering that the largest company in the industry could see a volume boom and still hold onto its position as competitors saw similar bursts of transactions.
Despite the increasing transaction volume, the company’s profit shrank from the previous quarter, but was still well above the loss of the fourth quarter of the previous year. Realogy reported net income of $ 18 million and basic earnings per share of $ 0.16 for the quarter.
Reported net income of $ 18 million and basic earnings per share of $ 0.16, an increase of $ 63 million year over year or $ 0.55 per share.
The company’s operating profit before interest tax amortization (EBITDA) increased 23 percent, or $ 136 million, year over year. The jump was driven by strong performance in mortgages and stocks, as well as increases in transaction volume and the company’s own strategic initiatives and cost management, Realogy said in a press release.
These strategic initiatives also include debt management, which has been an important focus of the company since Schneider became 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 has been a year of tremendous operational and financial execution for Realogy,” said Charlotte Simonelli, Realogy’s executive vice president, chief financial officer and treasurer. said in a statement.
“During the year under review, we achieved revenue growth, cost efficiency, impressive profitability and greater simplification while continuing to invest in the business,” added Simonelli. “We took advantage of market opportunities to improve our capital structure, including significant reductions in net debt and leverage, which further strengthened Realogy’s financial profile.”
Realogy’s strong annual performance – also given the company’s and industry’s early pandemic battles – was also a boon to the company’s share price. Realogy was trading at around $ 18 per share when the markets opened on Tuesday. In March 2020, that price fell completely in the $ 2 per share range.