Finance of America Companies Inc (FOA) 2023 Q4 法說會逐字稿

Ladies and gentlemen, thank you for standing by. My name is Desiree, and I will be your conference operator today. At this time, I would like to welcome everyone to the Finance of America fourth-quarter and full-year 2023 earnings call. (Operator Instructions)

女士們先生們，謝謝你們的支持。我叫 Desiree，今天我將擔任你們的會議操作員。此時此刻，我謹歡迎大家參加《美國金融》第四季和 2023 年全年財報電話會議。（操作員說明）

I would now like to turn the conference over to Michael Fant, Senior Vice President of Finance. Please go ahead.

現在我想將會議交給財務高級副總裁 Michael Fant。請繼續。

Thank you and good afternoon, everyone, and welcome to Finance of America's fourth-quarter and full-year 2023 earnings call. With me today are Graham Fleming, Chief Executive Officer; Kristen Sieffert, President; and Matt Engle, Chief Financial Officer. As a reminder, this call is being recorded, and you can find the earnings release and presentation on our Investor Relations website at www.financeofamerica.com.

謝謝大家，大家下午好，歡迎參加《美國金融》2023 年第四季和全年財報電話會議。今天與我在一起的有執行長 Graham Fleming；克莉絲汀·西弗特，總裁；和財務長馬特·恩格爾。謹此提醒，本次電話會議正在錄音，您可以在我們的投資者關係網站 www.financeofamerica.com 上找到收益發布和簡報。

In addition, we will refer to certain non-GAAP financial measures on this call. To the extent available without unreasonable efforts, you can find reconciliations of non-GAAP to GAAP financial measures discussed on today's call in our earnings press release on the Investor Relations page of our website.

此外，我們將在本次電話會議上提及某些非公認會計準則財務指標。在不進行不合理努力的情況下，您可以在我們網站的投資者關係頁面上的收益新聞稿中找到今天電話會議中討論的非公認會計原則與公認會計原則財務指標的調節表。

Also, I would like to remind everyone that comments on this conference call may be forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 regarding the company's expected operating and financial performance for future periods. These statements are based on the company's current expectations and are subject to the Safe Harbor statement for forward-looking statements that you will find in today's earnings release.

另外，我想提醒大家，本次電話會議的評論可能是 1995 年《私人證券訴訟改革法案》含義內的有關公司未來時期預期運營和財務業績的前瞻性陳述。這些陳述是基於公司目前的預期，並受前瞻性陳述安全港聲明的約束，您將在今天的收益發布中找到這些前瞻性陳述。

Actual results for future periods may differ materially from those expressed or implied by these forward-looking statements due to a number of risks or other factors, including those that are described in the Risk Factors section of Finance of America's annual report on Form 10-K for the year ended December 31, 2022, filed with the SEC on March 16, 2023.

由於多種風險或其他因素，包括美國金融公司 10-K 表格年度報告的風險因素部分中所述的風險或其他因素，未來期間的實際結果可能與這些前瞻性陳述中明示或暗示的結果有重大差異截至2022年12月31日的年度，於2023年3月16日向美國證券交易委員會提交。

As such, risk factors may be amended and updated in our subsequent filings with the SEC. We are not undertaking any commitment to update these statements if conditions change. Please note today we will be discussing interim period financials that are unaudited.

因此，風險因素可能會在我們隨後向 SEC 提交的文件中進行修改和更新。我們不承諾在情況改變時更新這些聲明。請注意，今天我們將討論未經審計的中期財務數據。

Now I would like to turn the call over to Finance of America's Chief Executive Officer, Graham Fleming. Graham?

現在我想將電話轉給美國金融執行長格雷厄姆·弗萊明。格雷厄姆？

Yeah, thank you, Michael. Good afternoon, everyone, and thank you for joining us.

是的，謝謝你，麥可。大家下午好，感謝您加入我們。

To begin, I would like to review our results as well as the broader macro-trends we are seeing in the industry. I will then turn things over to Kristen to share our strategic plan, followed by a review of our financials from our Chief Financial Officer, Matt Engel.

首先，我想回顧一下我們的結果以及我們在行業中看到的更廣泛的宏觀趨勢。然後我會將事情轉交給克里斯汀分享我們的策略計劃，然後由我們的財務長馬特恩格爾審查我們的財務狀況。

Overall, 2023 was a transformational period for Finance of America. Throughout the year, we completed a series of strategic transactions that helped establish the company as the preeminent platform for homeowners, 55 and older, seeking to benefit from their home equity. With most of these efforts now behind us, we are excited to move forward. As a business, we are firmly positioned as the leading provider of modern retirement solutions with the potential to reach tens of millions of customers nationwide.

整體而言，2023 年是美國金融業的轉型期。在這一年裡，我們完成了一系列策略交易，幫助該公司成為 55 歲及以上房主尋求從房屋淨值中受益的卓越平台。現在大部分努力已經過去，我們很高興能夠繼續前進。作為一家企業，我們牢牢定位為現代退休解決方案的領先供應商，有潛力覆蓋全國數千萬客戶。

For additional information, we have included a presentation on our Investor Relations website that addresses the potential total addressable market and our view of the investment opportunity. Finance of America is making home equity part of the mainstream modern retirement plan so that more Americans can benefit from the wealth in their home and have better outcomes later in life.

如需了解更多信息，我們已在投資者關係網站上發布了一份演示文稿，其中介紹了潛在的總體目標市場以及我們對投資機會的看法。美國金融正在將房屋淨值納入主流現代退休計劃的一部分，以便更多的美國人能夠從房屋財富中受益，並在以後的生活中獲得更好的結果。

With respect to our continuing operations, we recorded GAAP net income of $171 million or $0.72 per basic share in the fourth quarter. These results were driven primarily by fair value gains recognized in our portfolio of assets, given decreases in market rates in the quarter and improved results from operations, which we will discuss shortly.

關於我們的持續經營業務，我們第四季的 GAAP 淨利潤為 1.71 億美元，即每股基本股 0.72 美元。這些業績主要是由我們的資產組合中確認的公允價值收益所推動的，考慮到本季市場利率的下降和營運績效的改善，我們將很快討論這一點。

On an adjusted basis, in the fourth quarter, we recognized a net loss of $20 million or $0.09 per fully diluted share, an improvement over the third quarter of 20%. Beginning in retirement solutions, as expected, volumes decreased in the quarter due to seasonality, but improved margins and reduced expenses led to a 67% improvement in adjusted net loss for the quarter.

在調整後的基礎上，第四季我們確認淨虧損為 2,000 萬美元，即每股完全攤薄後的每股虧損 0.09 美元，比第三季改善了 20%。從退休解決方案開始，正如預期的那樣，由於季節性原因，該季度的銷量有所下降，但利潤率的提高和費用的減少導致該季度調整後的淨虧損改善了 67%。

In portfolio management, market volatility had a significant impact on quarterly results. In the fourth quarter, decreases across the yield curve, brought about significant increases in fair value of our portfolio of assets. Over the course of the year, the net balance increased by $24 million.

在投資組合管理方面，市場波動對季度業績有重大影響。第四季度，殖利率曲線的下降導致我們資產組合的公允價值大幅上升。這一年中，淨餘額增加了 2,400 萬美元。

Having established a solid foundation from which to grow, we are excited for what lies ahead. We continue to look at avenues to expand our product suite, enhance the customer experience and drive conversion. These include identifying ways to utilize AI. We have selected key AI partners and are excited to leverage these tools across sales, operations, marketing and data analytics. Additionally, we remain focused on managing expenses and strengthening our balance sheet for the long term.

已經為發展奠定了堅實的基礎，我們對未來感到興奮。我們持續尋找擴展產品套件、增強客戶體驗和推動轉換的途徑。其中包括確定利用人工智慧的方法。我們選擇了主要的人工智慧合作夥伴，並很高興能夠在銷售、營運、行銷和數據分析領域利用這些工具。此外，我們仍然專注於長期管理費用和加強我們的資產負債表。

Let me now turn things over to Kristen for an update on our operations, the integration of the AAG retail platform and the work we've been doing to enhance our products and sales channels. Kristen?

現在讓我向 Kristen 匯報我們的營運、AAG 零售平台的整合以及我們為增強產品和銷售管道所做的工作的最新情況。克里斯汀？

Good afternoon. As Graham mentioned, our vision is to make home equity an essential part of a modern mainstream retirement plan. We've designed a three-year strategic plan that we believe will enable us to achieve this goal while also helping us provide the most value to those we serve, including our shareholders.

午安.正如格雷厄姆所提到的，我們的願景是使房屋淨值成為現代主流退休計畫的重要組成部分。我們設計了一項為期三年的策略計劃，我們相信該計劃將使我們能夠實現這一目標，同時也幫助我們為我們的服務對象（包括我們的股東）提供最大的價值。

A key factor for advancing that plan was moving to one loan origination platform, which was the last major milestone related to the integration of the AAG retail platform. This was launched in late December as planned and the beginning of this year will be devoted to improving the efficiencies of that platform and ensuring we have strong workflows to support their originations engine and the planned growth.

推進該計劃的一個關鍵因素是轉向一個貸款發放平台，這是與 AAG 零售平台整合相關的最後一個重要里程碑。該平台按計劃於 12 月底啟動，今年年初將致力於提高該平台的效率，並確保我們擁有強大的工作流程來支援其發起引擎和計劃成長。

With much of the foundational work close to being completed, it paves the way for a shift of attention to the growth levers in the plan. We think Finance of America's modern retirement platform will create long-term growth at scale, and we have a few main reasons for this confidence.

隨著大部分基礎工作即將完成，這為將注意力轉向計劃中的成長槓桿鋪平了道路。我們認為美國金融的現代退休平台將創造大規模的長期成長，我們有這種信心的幾個主要原因。

The first is that we see a significant addressable market, which we believe were well positioned to capture as the category grows. Reverse mortgages are utilized by approximately 2% of the total addressable market. As the industry's leading retail and wholesale originator, Finance of America has close to 40% market share of this activity. We have our eyes fixed on driving market penetration over the long term so that as the total pie grows, we will have the ability to meaningfully increase our reach and impact as well.

首先，我們看到了一個重要的潛在市場，我們相信隨著該類別的成長，我們可以很好地抓住這個市場。反向抵押貸款的使用量約佔整個潛在市場的 2%。作為業界領先的零售和批發發起者，美國金融公司擁有該活動接近 40% 的市場份額。我們著眼於長期推動市場滲透，以便隨著蛋糕總量的成長，我們也將有能力有意義地擴大我們的影響力和影響力。

When you consider the nearly $3.7 trillion retirement savings gap and the record number of seniors who are financially unprepared for retirement using traditional vehicles alone, a solution must emerge. The obvious one is to incorporate the $13 trillion in home equity held by seniors. The second reason for confidence is the power of our distribution platform and its connection to product innovation.

當您考慮到近 3.7 兆美元的退休儲蓄缺口以及創紀錄數量的老年人在財務上沒有準備好僅使用傳統工具退休時，您必須找到解決方案。顯而易見的是，將老年人持有的 13 兆美元房屋淨值納入其中。第二個信心的原因是我們分銷平台的力量及其與產品創新的連結。

Through our direct-to-consumer channel, we reach more than 20 million consumers annually via our marketing and advertising, and our reach grows tremendously when you consider the large traditional mortgage lenders who utilize our suite of products with their clientele through our industry-leading wholesale channel. We've long been pioneers in our industry in creating non-agency products that fill gaps for customers. And our most recent innovation was a no-payments, second-lien home equity loan that we launched in 2023.

透過我們的直接面向消費者的管道，我們每年透過行銷和廣告覆蓋超過2000 萬消費者，當您考慮到大型傳統抵押貸款機構透過我們行業領先的服務與客戶一起使用我們的產品套件時，我們的影響力就會大幅成長。長期以來，我們一直是業界的先驅，致力於創造填補客戶空白的非代理產品。我們最新的創新是我們於 2023 年推出的免付款第二留置權房屋淨值貸款。

During the fourth quarter, we saw significant growth in non-agency volume funding 50% more proprietary production in Q4 than during Q3, further helping our customers thrive. While new loan products can provide solutions for a broader set of customers, we also recognize there's a significant gap as it relates to customer understanding and appeal of reverse mortgage products and the category overall.

在第四季度，我們看到第四季度的非代理數量顯著增長，自營生產資金比第三季度增加了 50%，進一步幫助我們的客戶蓬勃發展。雖然新的貸款產品可以為更廣泛的客戶群提供解決方案，但我們也認識到，在客戶對反向抵押貸款產品和整個類別的理解和吸引力方面還存在很大差距。

Our third reason for confidence is that we now have the components to change this. Within our three-year plan, we're committed to breaking this adoption barrier by investing in modernized messaging, digital technology, and tailored customer-centric experiences. These experiences are essential in unlocking the massive market opportunity that exists and providing our customers and partners the service and experience they deserve and expect.

我們充滿信心的第三個理由是我們現在擁有改變這種狀況的組件。在我們的三年計畫中，我們致力於透過投資現代化訊息、數位技術和以客戶為中心的客製化體驗來打破這一採用障礙。這些經驗對於釋放現有的龐大市場機會以及為我們的客戶和合作夥伴提供應得和期望的服務和體驗至關重要。

In all, we have a strong rationale for our approach and optimism around our strategic plan, given our dominant position within the industry. We have a clear vision, a strong team, and a proven track record of delivering results. We are confident we'll continue to see growth and strong operational performance within the business as we execute against our long-term vision, and we look forward to sharing continuous indicators of progress with you each quarter.

總而言之，鑑於我們在行業中的主導地位，我們對我們的方法和對戰略計劃的樂觀態度有充分的理由。我們擁有清晰的願景、強大的團隊以及交付成果的良好記錄。我們相信，在我們執行長期願景的過程中，我們將繼續看到業務的成長和強勁的營運業績，並且我們期待每季與您分享持續的進展指標。

Now let me turn things over to our CFO, Matt Engel.

現在讓我把事情交給我們的財務長馬特恩格爾。

Thank you, Kristen, and good afternoon, everyone. I'm excited to have joined the Finance of America team. We have a compelling story to tell and are at an exciting inflection point in the business. I look forward to speaking with and meeting many of you over the coming months. With that, let me start with a brief overview of our financial results before I dive into specifics on the quarter.

謝謝克里斯汀，大家下午好。我很高興加入美國金融團隊。我們有一個引人入勝的故事要講，並且正處於業務中令人興奮的轉折點。我期待在接下來的幾個月與你們中的許多人交談並會面。接下來，讓我先簡單概述一下我們的財務業績，然後再深入介紹本季的具體情況。

Within our continuing operations, we recognized GAAP net income of $171 million or $0.72 per basic share. Turning to the operating results, the company recognized an adjusted net loss of $20 million for the quarter or $0.09 per fully diluted share, an improvement of 20% from the third quarter. In our reverse platform, volumes decreased in the fourth quarter due to seasonality.

在我們的持續經營業務中，我們確認 GAAP 淨利潤為 1.71 億美元，即每股基本股 0.72 美元。談到經營業績，該公司確認本季調整後淨虧損為 2,000 萬美元，即每股完全攤薄後的每股虧損 0.09 美元，比第三季改善了 20%。在我們的反向平台中，由於季節性因素，第四季度的交易量有所下降。

Additionally, as Kristen mentioned, we began the consolidation of our loan origination system during the quarter, further impacting retail production. We originated $436 million in loan volumes, down 7% from the $470 million in the third quarter.

此外，正如克里斯汀所提到的，我們在本季開始整合貸款發放系統，進一步影響零售生產。我們發放了 4.36 億美元的貸款，比第三季的 4.7 億美元下降了 7%。

For the full year, we originated $1.6 billion in funded loan volume. While volumes were down compared to the prior year, maintaining the industry's leading retail and leading wholesale platformers allowed Finance of America to control a 37% share of the HECM reverse market and a significant portion of the non-agency market.

全年我們發放了 16 億美元的融資貸款。儘管交易量與前一年相比有所下降，但保持業界領先的零售和領先的批發平台使 Finance of America 能夠控制 HECM 反向市場的 37% 份額以及非代理市場的很大一部分。

Retirement solutions fourth-quarter revenue margin was 9.2%, an improvement of nearly 18% from the prior quarter. This is even more stark when looking at the monthly margins during the quarter. During October, when market rates reached their peak, our revenue margin fell to 7.4%, the lowest level since the acquisition of the AAG platform. By December, following the decline in market rates, our revenue margin peaked to 11.3% or the highest level of the year. So far, during the first quarter of 2024, we have continued to see strong performance in revenue margins as market rates stay below the highs experienced in October.

退休解決方案第四季營收率為 9.2%，較上一季提升近 18%。從本季的月度利潤率來看，這一點更加明顯。10月份，當市場價格達到頂峰時，我們的收入利潤率降至7.4%，為收購AAG平台以來的最低水準。到了 12 月，隨著市場利率的下降，我們的收入利潤率達到了 11.3% 的峰值，即年內的最高水平。到目前為止，2024 年第一季度，我們繼續看到營收利潤率表現強勁，因為市場利率仍低於 10 月的高點。

When it comes to operating expenses, the company continues to focus on finding ways to align our infrastructure to our modern retirement platform. During the fourth quarter, expenses reduced by $7 million or 7% from the third quarter. In addition, our corporate divisions continued to see a decline in operating expenses during the quarter as we further reduced our expense base by nearly 10%. This brings our annualized run rate reduction within corporate to nearly $90 million from our peak in early 2022 or the midpoint of our target range.

在營運費用方面，公司繼續致力於尋找使我們的基礎設施與現代退休平台保持一致的方法。第四季的費用比第三季減少了 700 萬美元，即 7%。此外，我們的公司部門在本季的營運費用持續下降，我們進一步將費用基礎減少了近 10%。這使得我們公司內部的年化運作率從 2022 年初的高峰或目標範圍的中點減少了近 9,000 萬美元。

Turning to our balance sheet, our cash balance was $46 million at the end of the year, down from $66 million in September. During the quarter, FOA completed a small home safe securitization, meaning that much of our cash was used to invest in our balance sheet as equity and newly funded home safe loans.

看看我們的資產負債表，年底我們的現金餘額為 4,600 萬美元，低於 9 月份的 6,600 萬美元。本季度，FOA 完成了小型家庭安全證券化，這意味著我們的大部分現金都用於投資於我們的資產負債表，例如股權和新資助的家庭安全貸款。

During February 2024, we completed two large securitizations, freeing up significant cash to be used to invest in and grow our business. Our residuals at the end of the year were valued at $260 million up from $49 million as of the end of September. Their value increased from the prior quarter as interest rates declined in November and December, validating our continued confidence in the long-term value of these assets. Based on comments from the Fed interest rates appear to be on a downward trend over the next few years, which we expect will have favorable impacts to the fair value of our balance sheet in the long run.

2024 年 2 月，我們完成了兩項大型證券化，釋放了大量現金，用於投資和發展我們的業務。截至 9 月底，我們的殘值為 2.6 億美元，而 9 月底為 4,900 萬美元。隨著 11 月和 12 月利率下降，它們的價值較上一季增加，這證實了我們對這些資產的長期價值的持續信心。根據聯準會的評論，未來幾年利率似乎呈下降趨勢，我們預計從長遠來看，這將對我們資產負債表的公允價值產生有利影響。

Lastly, I wanted to touch on the recent letters we have received from the New York Stock Exchange regarding compliance with listing requirements. Finance of America's leadership remains focused on generating enhanced enterprise value for all stakeholders and ensuring the company's long-term success. We intend to comply with NYSE listing standards and are actively considering steps to bring the company back into compliance within the required time period, which we do not anticipate impacting our ongoing business operations.

最後，我想談談我們最近從紐約證券交易所收到的有關遵守上市要求的信件。Finance of America 的領導層仍然專注於為所有利害關係人創造更高的企業價值並確保公司的長期成功。我們打算遵守紐約證券交易所上市標準，並正在積極考慮採取措施，使公司在規定的時間內恢復合規，我們預計這不會影響我們正在進行的業務運作。

While we're not done, we have made great strides as an organization to achieve our strategic goals. We are excited about the opportunity that lies ahead in 2024 and we believe in the long-term earnings power of the company. We're optimistic about our ability to achieve our goal of $0.40 to $0.50 in adjusted EPS on an annual basis and originating $300 million a month based on our scaled reverse mortgage business and current margins.

雖然我們的工作還沒有完成，但作為一個組織，我們在實現策略目標方面已經取得了長足的進步。我們對 2024 年的機會感到興奮，並且相信公司的長期獲利能力。根據我們規模化的反向抵押貸款業務和當前的利潤率，我們對實現每年 0.40 至 0.50 美元調整後每股收益以及每月 3 億美元的目標的能力持樂觀態度。

With that, let me now hand it back to Graham for closing remarks.

現在，讓我將其交還給格雷厄姆進行結束語。

Yes. Thank you, Matt. 2023 was a year of significant transformation for our business. In the face of an uncertain macro environment, we believe we both improved and strengthened our operations via acquisition and streamline their business to establish a foundation for success moving forward. More importantly, the overarching demographics in the US continue to make us confident in the long-term value of our business.

是的。謝謝你，馬特。 2023 年是我們業務發生重大轉型的一年。面對不確定的宏觀環境，我們相信，我們透過收購改善和加強了我們的運營，並簡化了業務，為未來的成功奠定了基礎。更重要的是，美國的整體人口結構繼續使我們對我們業務的長期價值充滿信心。

The proportion of retirees is at an all-time high and growing at a time when most don't have nearly enough saved for retirement and older homeowners as a whole have more than $13 trillion in home equity. We believe we are well positioned to benefit from a more favorable interest-rate environment and a growing customer base open to utilizing their home equity to help them thrive in retirement and with that, we'll open the call up for some questions.

退休人員的比例正處於歷史最高水平，並且在大多數人沒有足夠的退休儲蓄且老年房主整體擁有超過 13 兆美元的房屋淨值的情況下不斷增長。我們相信，我們處於有利地位，可以從更有利的利率環境和不斷增長的客戶群中受益，他們願意利用自己的房屋淨值來幫助他們在退休後蓬勃發展，因此，我們將開始徵集一些問題。

(Operator Instructions) Stephen Laws, Raymond James.

（操作員說明）Stephen Laws、Raymond James。

Hi, Good afternoon. Hi, Graham. Matt, I actually want to start with you based on a couple of comments you made. I think you said in February, you did two securitizations which freed up some cash or were those -- I think one was a refinance. Can you talk about demand for those deals on your securitizations? Then how much liquidity or cash does that free up? And what are you able to do with that incremental loss cash?

嗨，下午好。嗨，格雷厄姆。馬特，我實際上想根據您發表的一些評論從您開始。我想你在二月說過，你進行了兩次證券化，釋放了一些現金，或者說，我認為其中一次是再融資。您能談談對您的證券化交易的需求嗎？那麼這會釋放多少流動性或現金呢？您能用這些增量損失現金做什麼？

So I think overall demand for those deals was strong. They're fully subscribed. We sold all the bonds in the stack. They were received pretty well in the. Market with that cash, we're just ongoing cash to grow the business continue to invest in the HomeSafe production. That causes some cash in later months until you do the next securitization. That's kind of the main use of it. The rest of the -- this kind of corporate cleanup is behind us in 2023, as Graham mentioned. So a lot of that cash burn over the past is behind us.

所以我認為這些交易的整體需求很強勁。他們已經完全訂閱了。我們出售了堆疊中的所有債券。他們在當地受到了很好的歡迎。市場上有這些現金，我們只是持續現金發展業務，繼續投資 HomeSafe 生產。這會在接下來的幾個月帶來一些現金，直到你進行下一次證券化。這就是它的主要用途。正如格雷厄姆所提到的，剩下的——這種企業清理工作將在 2023 年成為過去。因此，過去的大量現金消耗已經成為過去。

And then what's the outlook for additional securitization calls. Do you have any more deals you may call and lever back up in a new deal? How do you think about the call opportunity going forward?

那麼額外的證券化呼籲的前景如何。您還有更多交易可以調用並在新交易中進行槓桿支持嗎？您如何看待未來的通話機會？

So I'd answer that this way, Stephen, right? So obviously, there's a -- it was something in the range of 30 deals outstanding. We look at them -- look, first of all, we look at our operating liquidity needs over the coming years. We look at the value of these residuals at the auction date and at the call date. And we make -- we do not have a specific plan at this time to call more deals. But obviously, we'll look at the economic value and maximize that kind of crossover between the liquidity and the economics.

所以我會這樣回答，史蒂芬，對嗎？顯然，有 30 筆未完成的交易。我們關注它們——首先，我們關注未來幾年的營運流動性需求。我們在拍賣日和贖回日查看這些殘差的價值。我們目前沒有具體計劃來進行更多交易。但顯然，我們將著眼於經濟價值，並最大化流動性和經濟之間的交叉。

But as you can see from the Q4 results, there's a lot of value now inherent in these residuals and we'll call the reissue as we see fit depending on the call date or the mandatory or the auction date or mandatory or call date. There is definitely opportunity to generate liquidity by calling and reissuing some of these are these on past deals.

但正如您從第四季度的結果中看到的那樣，這些殘差現在具有很大的內在價值，我們將根據贖回日期或強製或拍賣日期或強製或贖回日期，根據我們認為合適的方式進行重新發行。肯定有機會透過調用和重新發行其中一些（過去交易中的這些）來產生流動性。

I guess as long as you expect to build cash, you think about where we are on Q1. How do you expect to see cash balance maintained as we move to the first half of this year?

我想只要你希望累積現金，你就會考慮我們在第一季的處境。隨著今年上半年的到來，您預計現金餘額將如何維持？

I don't think we'll really start to build cash in the first half of the year. It's a bit of a delay as that our retail origination platform kind of gets the volume going back up. We get some additional production through the HomeSafe deals towards maybe the end of second quarter into the third quarter. I think I would not expect to see a large cash build certainly in the first half of the year.

我認為我們不會在今年上半年真正開始累積現金。這有點延遲，因為我們的零售發起平台的銷售有所回升。我們可能會在第二季末到第三季透過 HomeSafe 交易獲得一些額外的產量。我認為今年上半年肯定不會看到大量現金累積。

Great. And then, Matt, just to sort of make sure I got my notes down. I think you said kind of continuing to target $300 million a month and at that volume level, bill supports a longer-term and A&I outlook of $0.40 annually. Is that does that what you said?

偉大的。然後，馬特，只是為了確保我記下了我的筆記。我想你說過繼續設定每月 3 億美元的目標，在這個數量水平上，賬單支持每年 0.40 美元的長期和 A&I 前景。是你說的那樣嗎？

That's exactly right.

完全正確。

Okay. Great. And then lastly for me for now, I think one of your competitors may be priced to deal pretty attractively in Q1. Can you talk about -- we're almost into the quarter, but I realize things could change in the next 25 days. But how do you think about -- or how are the year-to-date fair value changes? Certainly, Q4 was a welcome relief after that being a headwind in the summer last year, but how was year to date for value changes trending?

好的。偉大的。最後對我來說，我認為你的一個競爭對手在第一季的定價可能相當有吸引力。您能談談嗎？但您如何看待——或者說年初至今的公允價值變化如何？當然，繼去年夏天的逆風之後，第四季是一個值得歡迎的緩解，但今年迄今價值變化趨勢如何？

So look obviously, there's three major components, Stephen. And that number one is the rates, right, which we're not exactly sure where rates will finish at the end of the quarter. We've kind of seen -- we've seen it move up about 30 basis points and come back down a little bit here.

顯然，史蒂芬，它由三個主要組成部分組成。第一個是利率，對吧，我們不確定利率在本季末會達到什麼水準。我們已經看到它上漲了大約 30 個基點，然後又回落了一點。

The second component is spreads. We've seen spreads definitely tightening in here at the beginning of the year, not just on our proprietary product, but also on our agency HECM product. And the last piece is HPA, right? It's remained robust waiting on some days to come out here in in March, which hopefully supports what we've seen from Case-Shiller. But if that's positive and spreads are tight and rates are -- let's say, rates come down a little further before the end of the quarter, it should be an overall positive impact for value.

第二個組成部分是點差。今年年初，我們已經看到價差明顯收緊，不僅是我們的專有產品，還有我們代理的 HECM 產品。最後一塊是HPA，對嗎？3 月的一些日子裡，人們仍然在等待，這希望支持我們從凱斯-希勒那裡看到的情況。但如果這是正面的，利差收窄，利率在本季末之前進一步下降，那麼這應該會對價值產生整體正面影響。

Great. Appreciate the comments this afternoon. Thank you.

偉大的。感謝今天下午的評論。謝謝。

Doug Harter, UBS.

道格·哈特，瑞銀集團。

Hi, this is Cory Johnson on for Doug Harter. I just wanted to -- could you talk me through is there any way to perhaps limit the mark-to-market volatility of the balance sheet and/or reduce the balance sheet intensity of the business?

大家好，我是道格·哈特的科里·約翰遜。我只是想——你能告訴我有沒有什麼方法可以限制資產負債表的市價波動和/或降低企業的資產負債表強度？

Unfortunately, these are GAAP issues, and these are all mandated in accordance with GAAP. So there's no ideas right at the top of my head other than marking everything to zero, which obviously GAAP won't allow us to do. It is based on some close to almost a $10 billion UPB balance. So relatively speaking it is basis points, but Matt, any anything to add?

不幸的是，這些都是公認會計原則問題，而且都是根據公認會計原則強制執行的。因此，除了將所有內容標記為零之外，我腦子裡沒有任何想法，這顯然是 GAAP 不允許我們這樣做的。它基於接近 100 億美元的 UPB 餘額。所以相對來說這是基點，但馬特，有什麼要補充的嗎？

I think if you always look at -- the question we sometimes get is around hedging and whether you put big hedges in place. There's upsides and downside to that from a liquidity standpoint when rates go against you. So some we look at from time to time, we've hedged in some of the past; we'll consider doing so in the future. But right now, given where we are in the rate cycle, we're paying with some of this volatility, and it's moving kind of back in our favor.

我認為，如果你總是關注——我們有時會遇到的問題是圍繞對沖以及你是否設定了一個大的對沖。從流動性的角度來看，當利率對您不利時，這既有好處也有壞處。所以有些我們時不時地看，有些我們在過去就對沖了；我們將來會考慮這樣做。但目前，考慮到我們所處的利率週期，我們正在付出一些波動性的代價，而且它正在朝著對我們有利的方向發展。

Great. Thank you. And I want to see -- is the path to operating profitability, that's going to be through increased revenue or is there further expense reductions that could take place?

偉大的。謝謝。我想知道，實現營運獲利的途徑是增加收入還是進一步削減開支？

There's a little more on the expense side, right, that we're going to tackle in Q2. Primarily revenue margins have improved. We don't expect them to be much higher than they were in December. So the path to profitability now is increased volume, which we also expect to see increased volume as we're through this loan origination consolidation. We're currently anticipating A&I high profitability kind of over towards the end of Q2 over the summer. So we do have a path to return to A&I profitability.

我們將在第二季度解決費用方面的問題，對吧。主要是收入利潤率有所改善。我們預計它們不會比 12 月高很多。因此，現在實現獲利的途徑是增加數量，我們也預期隨著貸款發放整合的進行，數量也會增加。我們目前預計 A&I 的高獲利能力將在夏季第二季末結束。因此，我們確實有一條恢復 A&I 獲利能力的途徑。

Great, thanks. And just a last question for me. Can you maybe talk a little bit about the outlook for reverse origination volumes in India in the current rate environment?

萬分感謝。這是我的最後一個問題。您能否談談當前利率環境下印度反向發起量的前景？

Yeah, I would say that right now it's probably less about the current rate environment and just about getting the kind of operating platform and the technology integration completed. We've got the levers to pull to drive the growth. We just need to do so from a stable foundation, which is what we've been mainly focused on over the last two quarters.

是的，我想說，現在可能不太關注當前的費率環境，而只是專注於完成哪種操作平台和技術整合。我們擁有推動成長的槓桿。我們只需要在穩定的基礎上做到這一點，這是我們過去兩個季度主要關注的事情。

So the plan is to incrementally begin growing the production volume through the course of this year and well into the future. And obviously, when rates come down, it makes it easier. But with where rates are today, we still believe in the growth model that we have.

因此，計劃是在今年和未來逐步開始增加產量。顯然，當利率下降時，事情就會變得更容易。但就目前的利率水準而言，我們仍然相信我們現有的成長模式。

Great. Thank you. Appreciate the answer.

偉大的。謝謝。感謝您的回答。

Lee Cooperman, Omega Family Office.

李庫柏曼，歐米茄家族辦公室。

Thank you. I have four questions and maybe one you already responded to. What is your expectation for recurring operating earnings. Somebody mentioned on the call, the volatility. The $0.40 to $0.50 that you mentioned, was that recurring operating earnings this year or your objectives down the road. That's question one.

謝謝。我有四個問題，也許您已經回答了其中一個問題。您對經常性營業收入的期望是多少？有人在電話會議中提到了波動性。您提到的 0.40 美元到 0.50 美元是今年的經常性營業收入或您未來的目標。這是問題一。

So Lee, in the $0.40 to $0.50 be based on $300 million a month of originations, currently averaging somewhere around $140 million and $150 million. So we need to grow into that. We would expect to be on a path for that towards the end of this year. I don't think we're going to achieve $0.40 to $0.50.

Lee 表示，基於每月 3 億美元的起始資金，介於 0.40 至 0.50 美元之間，目前平均約為 1.4 億至 1.5 億美元。所以我們需要成長到這一點。我們預計將在今年年底實現這一目標。我認為我們不會達到 0.40 至 0.50 美元。

What is your expectation for operating earnings this year? Do you have one? And you're willing to share?

您對今年的營業收入有何預期？你是否有一個？而你願意分享嗎？

We haven't provided that specific guidance. I would say that our submissions and our pipelines are growing on it. We're optimistic that the volume will grow over the course of the year. We haven't given out specific (multiple speakers)

我們尚未提供具體指導。我想說的是，我們的提交內容和管道正在不斷增長。我們樂觀地認為今年的銷量將會成長。我們還沒有給出具體的（多個發言者）

Is it -- Is it an open platform. Do you want to make a statement or you'd rather not?

它是——它是一個開放平台嗎？您想發表聲明還是不願意發表聲明？

I'd rather not, at this point, Lee.

李，在這一點上我不想。

All right. Second, how do you rate your capital adequacy to conduct business that you want to conduct the way you want to conduct it? Do you have adequate capital?

好的。其次，您如何評價您的資本充足程度，以按照您希望的方式開展業務？你有足夠的資金嗎？

We do have adequate capital. We are constantly addressing our needs as we see fit with warehouse lines, timing our securitizations, our lines of credit and so forth. So we feel that we're properly capitalized for our growth in 2024.

我們確實有足夠的資本。我們持續滿足我們認為適合的倉庫線、證券化、信貸額度等方面的需求。因此，我們認為我們擁有適當的資本來實現 2024 年的成長。

I don't follow with that closely the way I want a lot shares but -- hold on, my cell phone is ringing. There was enormous increase in the share count from 88 million to 229 million fully diluted basically, what is the actual share count currently fully diluted? Is it to 229.3 million? (multiple speakers) page 7 of your press release?

我並沒有像想要大量股票那樣密切關注，但是——等一下，我的手機響了。從8,800萬股大幅增加到基本完全稀釋後的2.29億股，目前完全稀釋後實際股數為何？是2.293億嗎？（多名發言者）您的新聞稿第 7 頁？

That's the fully diluted share count. Yes, Lee.

這是完全稀釋後的股數。是的，李。

What accounted for the 200 and -- I would say about 150 million, 140 million increased shares.

這 200 股和——我想說大約 1.5 億股、1.4 億股增加了股票。

There wasn't -- I don't think that was a 140 million share increase.

我認為這不是 1.4 億股的成長。

Well, it says here on page 7 of your release, the basic weighted average shares outstanding was 88.4 million. And the dilution diluted shares to 229.3 million. And a year ago was 87.7 million.

嗯，在你們新聞稿的第 7 頁上說，基本加權平均流通股數為 8,840 萬股。且稀釋後的股份稀釋至2.293億股。一年前是 8770 萬。

Yes, Lee. So that actually has to do with the method by which we run the if converted or fully diluted EPS calc. And so because it is not dilutive and/or anti-dilutive on the fully diluted view when you add in all shares for that GAAP requires us to just use the basic share count that. So that's why you can see the basic and diluted per share number is the same in each of those periods. It's just Q4 of this year where the diluted EPS is dilutive compared to basic.

是的，李。因此，這實際上與我們運行轉換或完全稀釋每股收益計算的方法有關。因此，因為當您添加 GAAP 的所有股份時，從完全稀釋的角度來看，它並不具有稀釋性和/或反稀釋性，因此要求我們僅使用基本股份數。這就是為什麼您可以看到每個時期的基本每股數和稀釋每股數都是相同的。今年才第四季度，稀釋後每股盈餘與基本每股盈餘相比是稀釋性的。

You mentioned your view of interest rates. I happen to be of the view that short rates could drop, but long rates are not going to go down and effective probably go up.

您提到了您對利率的看法。我碰巧認為短期利率可能會下降，但長期利率不會下降，有效利率可能會上升。

What's more important to you, the 90-day bill rate or the 10-year rate? The reason I say what I say is prior to the Great Financial Crisis, the 10-year bond used to yield in line with nominal GDP. Assuming 2% real growth and 3% inflation, that would be 5%, the 10 year wouldn't be undervaluing (multiple speakers)

對您來說，90 天帳單利率和 10 年期帳單利率哪個更重要？我之所以這麼說，是因為在金融危機之前，十年期公債的殖利率與名目GDP一致。假設實質成長率為 2%，通貨膨脹率為 3%，那麼 10 年的成長率就不會被低估（多個發言者）

We're not quite out as far as the tenure, Lee. What's important to us is probably in the five- to seven-year range.

李，我們還沒有完全確定任期。對我們來說重要的可能是五到七年的範圍。

Five to seven year. Well, that rate goes down, but whatever. The 10-year rate is less significant to you in the short-term rates?

五到七年。好吧，這個比率會下降，但無論如何。在短期利率中，10 年期利率對您來說不太重要？

Yeah, our assets are up probably seven-year duration. So that's kind of where that's kind of where we're focused on the curve.

是的，我們的資產持續時間可能長達七年。這就是我們關注曲線的地方。

Got you. Okay. Thank you very much. Good luck.

明白你了。好的。非常感謝。祝你好運。

Thank you.

謝謝。

There are no further questions at this time. Mr. Fleming, I turn the call back over to you.

目前沒有其他問題。弗萊明先生，我將電話轉回給您。

Yes. I'd like to thank everybody for joining the call, and we look forward to our updates at the end of Q1, which we expect in May. So thank you, everybody, and good night.

是的。我要感謝大家加入電話會議，我們期待在第一季末（預計在 5 月）發布更新。謝謝大家，晚安。

This concludes today's conference call. You may now disconnect.

今天的電話會議到此結束。您現在可以斷開連線。