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Altisource Announces First Quarter Results

Stock quotes in this article: ASPS

LUXEMBOURG, April 25, 2013 (GLOBE NEWSWIRE) -- Altisource Portfolio Solutions S.A. ("Altisource") (Nasdaq:ASPS) today reported net income attributable to Altisource of $27.5 million or $1.10 per diluted share for the three months ended March 31, 2013, an increase in net income and diluted earnings per share from the three months ended March 31, 2012 of 9% and 8%, respectively. Service revenue was $127.6 million for the three months ended March 31, 2013, an 18% increase when compared to the three months ended March 31, 2012.

The first quarter 2013 increase in net income over the same period in the prior year is primarily from stronger service revenue growth in the higher margin Mortgage Services segment even with limited benefit from the Ocwen Financial Corporation ("Ocwen") acquisition of the Homeward Residential, Inc. ("Homeward") servicing platform and no benefit from Ocwen's acquisition of the Residential Capital, LLC ("ResCap") servicing platform and the Ally Financial Inc. ("Ally") servicing rights. The improvement was partially offset by interest expense on our $200.0 million Senior Secured Term Loan that was funded in the fourth quarter of 2012, increased technology expenses to support our growth and the carrying of Mortgage Services employee and facility expenses in anticipation of the near doubling of the number of non-GSE loans serviced by Ocwen on the REALServicing ® platform by the fourth quarter of 2013 (compared to the fourth quarter of 2012).

"With Ocwen's recent and anticipated servicing portfolio growth coupled with our development of new default related services and our other growth initiatives, we believe we are well positioned for long-term growth in revenue and earnings even with the cyclical changes anticipated in the default and origination markets," said Chairman William Erbey.

William Shepro, Chief Executive Officer, further commented, "We are very pleased with our first quarter results particularly given that our Mortgage Services segment is almost fully staffed to support the near doubling of the non-GSE loans on REALServicing by the fourth quarter of 2013. We accomplished our results with only modest benefit from the Homeward servicing portfolio and no benefit from the ResCap and Ally servicing portfolios.  This bolsters our confidence that our default businesses' operating margins will increase by approximately seven percentage points by year-end 2013, even after amortizing the intangible assets associated with the Homeward and ResCap transactions."

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