RE/MAX Holdings, Inc. (NYSE:RMAX) Q4 2019 Earnings Conference Call - Final Transcript

Feb 21, 2020 • 08:30 am ET


RE/MAX Holdings, Inc. (NYSE:RMAX) Q4 2019 Earnings Conference Call - Final Transcript


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Good morning and welcome to the RE/MAX Holdings Fourth Quarter 2019 Earnings Conference Call and Webcast. My name is Laura and I will be facilitating the audio portion of today's call.

At this time, I would like to turn the call over to Andy Schulz, Vice President of Investor Relations. Mr. Schulz?

Andy Schulz

Thank you, operator. Good morning, everyone and welcome to RE/MAX Holdings fourth quarter and full year 2019 earnings conference call. Please visit the Investor Relations page of for all earnings related materials and to access the live webcast and the replay of the call today. If you are participating through the webcast, please note that you will need to advance the slides as we move through the presentation.

Turning to slide 2. Our prepared remarks and answers to your questions on today's call may contain forward-looking statements. Forward-looking statements include those related to agent count, franchise sales, financial measures and guidance, brand expansion, competition, technology, housing and mortgage market conditions, capital allocation, dividends, strategic and operational plans and business models. Forward-looking statements represent management's current estimates. RE/MAX assumes no obligation to update any forward-looking statements in the future. Forward-looking statements address matters that are subject to risks and uncertainties that may cause actual results to differ materially from those projected in forward-looking statements. These are discussed in our fourth quarter and full year 2019 financial results press release and other SEC filings.

Also, we will refer to certain non-GAAP measures on today's call. Please see the definitions and reconciliations of non-GAAP measures contained in our most recent quarterly financial results press release which is available on our website. Joining me on our call today are Adam Contos, our Chief Executive Officer; and Karri Callahan, our Chief Financial Officer. Ward Morrison, President of Motto Mortgage; and Nick Bailey, RE/MAX's Chief Customer Officer will join us for the Q&A.

With that I'd like to turn the call over to RE/MAX Holdings' CEO, Adam Contos. Adam?

Adam Contos

Thank you, Andy and thanks to everyone for joining our call today. We have many positive topics to discuss. So let's get right to it. Looking at slide 3, recent RE/MAX recruiting initiatives and Motto marketing efforts generated positive results almost immediately, leading to a bounce back in our US agent count and a record Motto franchise sales. Two of our key leading indicators, the targeted investments we made early in the fourth quarter alongside the continued positive impact from the many strategic moves we've implemented in the past two years contributed to the quarter's encouraging results. Combined with the relatively attractive housing markets in both the US and Canada, we entered 2020 with momentum. Other highlights of the quarter included revenue of $68.2 million, adjusted EBITDA of $22.5 million, adjusted EPS of $0.47, total RE/MAX agent count increased over 5%, exceeding 130,000 agents for the first time in our history and the technology transformation at RE/MAX continued with the ongoing rollout of the powerful boost platform as well as the exciting acquisition of another