Guild Holdings Limited,parent company guild mortgagewhich turned profitable in the second quarter of 2024, driven primarily by performance from its growing services portfolio. At the same time, issuance volume from April to June increased by 69% from the previous quarter, but profit margins were lower.
Net income rose to $37.6 million in the second quarter of 2024, compared with $28.5 million in the previous quarter, according to filings with the Securities and Exchange Commission. Securities and Exchange Commission (U.S. Securities and Exchange Commission). Data show that adjusted net profit was US$30.7 million and adjusted EBITDA was US$41.6 million.
Guild CEO Terry Schmidt said in a statement that the company’s results reflected its strategy to grow market share “by investing in people and technology” and “executing effectively in a challenging market environment.” ability.
Schmidt also emphasized consolidation during an earnings call with analysts College Mortgageacquired in February, represents 18% to 20% of the company’s original volume. She also mentioned the launch of GuildGPT, an in-house artificial intelligence (AI) system that allows “team members to easily access AI assistance to deliver customer messages instantly in the background.”
Schmidt said Guild will pursue “selective acquisitions that fit our model and culture.” She told analysts that while the M&A pipeline remains active, activity has slowed and organic growth through hiring local representation remains a good option.
Guild disbursed $6.5 billion in funds in the second quarter, a 69% quarterly increase, 92% of which involved home purchase loans. Executives compared sales growth to the industry average of 14%, suggesting Guild gained market share during the period.
However, its sales margin fell to 326 basis points from 364 basis points in the same period last year. Ultimately, the lender’s origination arm posted a net loss of $3.1 million from April to June, compared with a loss of $24.2 million in the previous quarter.
The bright spot was its services segment, which reported net income of $69.5 million in the second quarter of 2024, down from $83.9 million in the first quarter of 2024. .
The company’s unpaid principal balance (UPB) in its servicing portfolio grew by 9% to $89 billion, with the company retaining servicing rights for 68% of total loans sold in the second quarter of 2024. Guild’s purchase recapture rate was 27% in the second One quarter.
As rates fall, the company sees more opportunities to originate loans from across its servicing portfolio, as about 20% of UPB’s interest rates are above 6% and more than a quarter have rates above 5%. Executives said the retail platform is a natural hedge for business services.
As of June 30, the lender’s cash and cash equivalents position was $102.2 million.
In after-hours trading Thursday, Guild shares fell 0.06% to $15.90 after rising 12.6% during the day.
