In its year-end financial results, Realogy Holdings reported revenue of $6.1 billion, a decrease of $35 million compared to 2017. In the fourth quarter of 2018, revenue was $1.4 billion, a decrease of $90 million versus the fourth quarter of 2017, largely due to lower transaction volume at NRT, it said in a news release.
"2018 was both an exciting and challenging time at Realogy and in the industry," said Ryan Schneider, Realogy's chief executive officer and president. "While we face an uncertain housing market, the strategic changes we are driving for agents across products, technology, data and talent are beginning to get traction, giving me early confidence that these initiatives will lead to better company performance."
In 2018, Realogy's 191,700 U.S.-based affiliated independent sales agents helped consumers with approximately 1.4 million home-sale transaction sides. In aggregate, Realogy achieved home-sale transaction volume of approximately $512 billion, an increase of 1% compared to 2017. RFG average home-sale price increased 5% and home-sale transaction sides decreased 4%. NRT reported an average home-sale price increase of 2% and home-sale transaction sides decrease of 2%.
In the title and settlement services segment, TRG closed 176,000 transactions in 2018 with lower refinance volume leading to an overall decline of 6%. Purchase units decreased 1% compared to 2017. In the relocation services segment, Cartus initiations and referrals were both up 6%. Cartus generates highly qualified leads for its network of affiliated agents and helps them to build their businesses. Cartus generated referral opportunities for agents that resulted in approximately 80,000 in-network home-sale closings for Realogy and its brands in 2018.
Since the share repurchase program's inception in February 2016, the company has repurchased approximately 35.5 million shares through February 22, 2019 at an average price of $25.22 for $896 million. As a result, Realogy had approximately 113.5 million shares of common stock outstanding as of February 22, 2019.
Realogy announced that its Board of Directors has authorized a new share repurchase program for up to $175 million of its common stock. This is in addition to the $29 million remaining under the share repurchase authorization announced in February 2018. Repurchases may be made at management's discretion from time to time on the open market or through privately negotiated transactions. The size and timing of these repurchases will depend on price, market and economic conditions, legal and contractual requirements and other factors. The repurchase program has no time limit and may be suspended or discontinued at any time.
"We ended the year at a 4.6x leverage ratio and we face an uncertain housing market. Given this, in the first half of the year, you will see us focus on debt paydown. We will be watching closely how the macro environment evolves and you should expect that the weaker the housing market, the more we will look to pay down debt. The stronger the housing market, the more we will look to share repurchases," said Tim Gustavson, Realogy's interim chief financial officer.
On February 25, the Board of Directors declared a quarterly cash dividend of 9 cents per share of the company's common stock. This dividend payment will be made on March 25 to shareholders of record as of the close of business on March 11.
The company ended the year with cash and cash equivalents of $225 million. Total corporate debt, including the short-term portion, net of cash and cash equivalents (net corporate debt), totaled $3.4 billion at December 31, 2018. The company's net debt leverage ratio was 4.6 times at December 31, 2018.
At year end, the company's net operating loss carry-forwards were $855 million, which it expects will allow it to continue to pay minimal cash taxes through 2020.
In other recent news, Ethisphere Institute, a global leader in defining and advancing the standards of ethical business practices, named Realogy as one of the 2019 World's Most Ethical Companies®.
This is the eighth consecutive year in which Realogy has been recognized, underscoring its continuing commitment to leading with integrity and prioritizing ethical business practices. Realogy is one of 128 companies honored by Ethisphere this year, and one of only 4 honorees in the Real Estate Industry. In 2019, 128 honorees were recognized spanning 21 countries and 50 industries. The thirteenth class of honorees profoundly illustrate how companies continue to be the driving force for improving communities, building capable and empowered workforces, and fostering corporate cultures focused on ethics and a strong sense of purpose
"Realogy is honored to be recognized for the eighth consecutive year as one of the World's Most Ethical Companies," said CEO/president Ryan Schneider. "I am proud that Realogy is included alongside other global leaders who, like us, place great importance on driving positive change within our businesses and our communities. Even more, I am incredibly proud to work with the talented people here at Realogy who every day uphold our values of integrity, excellence and respect as we serve affiliated agents, franchise owners, and business partners."
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