Document
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______________________________________________________________________________________________________
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
_______________________________
FORM 8-K
_______________________________
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report: November 7, 2019
_______________________________
Realogy Holdings Corp.
(Exact Name of Registrant as Specified in its Charter)
Delaware
001-35674
20-8050955
(State or Other Jurisdiction of Incorporation)
(Commission File Number)
(IRS Employer Identification No.)
_______________________________
Realogy Group LLC
(Exact Name of Registrant as Specified in its Charter)
Delaware
333-148153
20-4381990
(State or Other Jurisdiction of Incorporation)
(Commission File Number)
(IRS Employer Identification No.)
_______________________________
175 Park Avenue
Madison, NJ 07940
(Address of principal executive offices) (Zip Code)
(973) 407-2000
(Registrant’s telephone number, including area code)
None
(Former name or former address if changed since last report)
_______________________________
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Securities registered pursuant to Section 12(b) of the Act:
Title of each class
Trading Symbol(s)
Name of each exchange on which registered
Realogy Holdings Corp.
Common Stock, par value $0.01 per share
RLGY
New York Stock Exchange
Realogy Group LLC
None
None
None
Indicate by check mark whether the registrant is an emerging growth company as defined in as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company 
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. 
______________________________________________________________________________________________________




Item 2.02.Results of Operations and Financial Condition.
On November 7, 2019, the Registrants announced their financial results for the third quarter of 2019. A copy of the press release is attached as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated herein by reference.
Item 9.01.Financial Statements and Exhibits.
(d)Exhibits
Exhibit No.
Description
99.1Press Release dated November 7, 2019.
104Cover Page Interactive Data File (embedded within the Inline XBRL document).




SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
REALOGY HOLDINGS CORP.
By:/s/ Charlotte C. Simonelli
Charlotte C. Simonelli, Executive Vice President, Chief Financial Officer and Treasurer
Date: November 7, 2019


Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
REALOGY GROUP LLC
By:/s/ Charlotte C. Simonelli
Charlotte C. Simonelli, Executive Vice President, Chief Financial Officer and Treasurer
Date: November 7, 2019





EXHIBIT INDEX
Exhibit No.
Description
99.1
104.0Cover Page Interactive Data File (embedded within the Inline XBRL document).


Document
Exhibit 99.1


http://api.tenkwizard.com/cgi/image?quest=1&rid=23&ipage=13186778&doc=8
REALOGY REPORTS THIRD QUARTER
2019 FINANCIAL RESULTS


MADISON, N.J. (November 7, 2019) - Realogy Holdings Corp. (NYSE: RLGY), the largest full-service residential real estate services company in the United States, today reported financial results for the third quarter ended September 30, 2019.
“In the third quarter of 2019, we leveraged the strength of Realogy's size, scale and brands to grow our agent base, launch three new high impact products, and introduce two new high-quality lead generation programs," said Ryan Schneider, Realogy's chief executive officer and president. “We are energized by our new products and partnerships, which we believe will win more listings, attract more agents and franchisees, and drive growth."

“We delivered Operating EBITDA, generated positive free cash flow, reduced debt, and executed new cost efficiency programs which will generate incremental savings in 2019 and 2020," said Charlotte Simonelli, Realogy's executive vice president, chief financial officer and treasurer. “We are positioning Realogy for improving financial and operational performance and remain resolute in our goal to reduce leverage."

Third Quarter 2019 Highlights
Generated Revenue of $1.6 billion.
Reported a net loss of $70 million, driven by a $180 million impairment at NRT, and Adjusted net income of $74 million (See Table 1a).
Generated Operating EBITDA of $223 million (See Table 4a).
Tracking to achieve $70 million of realized cost savings with 80% of the actions already completed. Through Q3 2019, $44 million of the $70 million in cost savings have been realized.
Generated Free Cash Flow of $174 million during the third quarter (See Table 6).
Reduced net debt by $163 million from June 30, 2019 (See Table 7b).
Continued moderation in commission split pressure, up only 47 basis points year-over-year.
Grew the NRT agent base by approximately 3% year-to-date to 51,600 in the third quarter of 2019.
Executed three new high impact product launches with RealSure, RealVitalize and Exclusive Look.
Expanded high-quality lead generation opportunities with the Realogy Military Rewards program and a partnership with AARP that will launch in Q1 2020.

Third Quarter 2019 Financial Highlights
The following table sets forth Realogy’s financial highlights for the periods presented (in millions, except per share data) (unaudited):


Exhibit 99.1

Three Months Ended September 30,
20192018 Change% Change
Revenue$1,629  $1,676  $(47) (3)%
Operating EBITDA 1
$223  $242  $(19) (8)%
Net (Loss) Income$(70) $103  $(173) (168)%
Adjusted Net Income 2
$74  $104  $(30) (29)%
(Loss) Earnings Per Share$(0.61) $0.84  $(1.45) (173)%
Adjusted Earnings per Share 2
$0.65  $0.85  $(0.20) (24)%
Free Cash Flow 3
$174  $194  $(20) (10)%
Net Cash provided by operating activities$174  $215  $(41) (19)%
Select Key Drivers
RFG 4 5
Closed homesale sides 299,937  308,917  (3)%
Average homesale price$314,984  $305,398  %
NRT 5
Closed homesale sides92,399  94,241  (2)%
Average homesale price$509,425  $513,403  (1)%
Cartus
Initiations39,589  42,718  (7)%
Referrals25,085  24,769  %
TRG
Purchase title and closing units41,619  43,836  (5)%
Refinance title and closing units8,014  4,264  88 %
_______________
Footnotes:
1 See Table 4a. Operating EBITDA is defined as net income (loss) before depreciation and amortization, interest expense, net (other than relocation services interest for securitization assets and securitization obligations), income taxes, and other items that are not core to the operating activities of the Company such as restructuring charges, former parent legacy items, gains or losses on the early extinguishment of debt, impairments, gains or losses on discontinued operations and gains or losses on the sale of investments or other assets.
2 See Table 1a. Adjusted net income (loss) is defined as net income (loss) before mark-to-market interest rate swap adjustments, former parent legacy items, restructuring charges, (gain) loss on the early extinguishment of debt, impairments and the tax effect of the foregoing adjustments.
3 See Table 6. Free Cash Flow is defined as net income (loss) attributable to Realogy before income tax expense (benefit), net of payments, net interest expense, cash interest payments, depreciation and amortization, capital expenditures, restructuring costs and former parent legacy costs (benefits), net of payments, impairments, (gain) loss on the early extinguishment of debt, working capital adjustments and relocation receivables (assets), net of change in securitization obligations.
4 Includes all franchisees except for NRT.
5 The Company's combined homesale transaction volume (transaction sides multiplied by average sale price) decreased 1% compared with the third quarter of 2018. The decline was primarily driven by the intense competitive environment as well as our geographic concentration. For reference, the National Association of Realtors reported that homesale transaction volume increased 6% in the third quarter of 2019 compared to 2018.
Looking Ahead
Based on what the Company knows today and subject to macro uncertainty, we expect Operating EBITDA to be at the lower end of our previous guidance of $590 to $610 million for full year 2019. This guidance is based on us having around 5% transaction volume growth in the fourth quarter with better balance between NRT and RFG. We expect to be below NAR's current fourth quarter transaction volume growth forecast of 13%.
Balance Sheet and Capital Allocation
The Company ended the quarter with cash and cash equivalents of $266 million. Total corporate debt, including the short-term portion, net of cash and cash equivalents (net corporate debt), totaled $3.3 billion at September 30, 2019. The Company's Net Debt Leverage Ratio was 5.2 times at September 30, 2019. The Net Debt Leverage Ratio is net


Exhibit 99.1

corporate debt divided by EBITDA, as defined by the Senior Secured Credit Facility, for the four-quarter period ended September 30, 2019.
During the third quarter of 2019, Realogy Group used cash on hand to repurchase $93 million of its 4.875% Senior Notes at an aggregate purchase price of $83 million, plus accrued interest to the repurchase date. In conjunction with the repurchase, the Company recorded a gain on the early extinguishment of debt of $10 million.
The Company's Board of Directors decided that, effective immediately, it will no longer pay a quarterly cash dividend. The change in the dividend policy will accelerate deleveraging and support ongoing investment in the business.

The Company expects to prioritize investing in its business and reducing leverage over other potential uses of cash until it is able to reduce its Consolidated Leverage Ratio (as defined under the indenture governing the Company's 9.375% Senior Notes) to below 4.00 to 1.00 (see footnote b to Table 7b).
A consolidated balance sheet is included as Table 2 of this press release.
Investor Conference Call
Today, November 7, at 8:30 a.m. (ET), Realogy will hold a conference call via webcast to review its Q3 2019 results. The webcast will be hosted by Ryan Schneider, chief executive officer and president, and Charlotte Simonelli, chief financial officer, and will conclude with an investor Q&A period with management.
Investors may access the conference call live via webcast at ir.realogy.com or by dialing (888) 895-3527 (toll free); international participants should dial (706) 679-2250. Please dial in at least 5 to 10 minutes prior to start time. A webcast replay also will be available on the website.
About Realogy Holdings Corp.
Realogy Holdings Corp. (NYSE: RLGY) is the leading and most integrated provider of residential real estate services in the U.S. that is focused on empowering independent sales agents to best serve today’s consumers. Realogy delivers its services through its well-known industry brands including Better Homes and Gardens® Real Estate, CENTURY 21®, Climb Real Estate®, Coldwell Banker®, Coldwell Banker Commercial®, Corcoran®, ERA®, Sotheby's International Realty® as well as NRT, Cartus®, Title Resource Group and ZapLabs®, an in-house innovation and technology development lab. Realogy’s fully integrated business model includes brokerage, franchising, relocation, mortgage, and title and settlement services. Realogy provides independent sales agents access to leading technology, best-in-class marketing and learning programs, and support services to help them become more productive and build stronger businesses. Realogy’s affiliated brokerages operate around the world with approximately 190,000 independent sales agents in the United States and approximately 110,400 independent sales agents in 112 other countries and territories. Realogy is headquartered in Madison, New Jersey.
Forward-Looking Statements
Certain statements in this press release constitute "forward-looking statements." Such forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of Realogy Holdings Corp. to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Statements preceded by, followed by or that otherwise include the words "believes", "expects", "anticipates", "intends", "projects", "estimates", "potential" and "plans" and similar expressions or future or conditional verbs such as "will", "should", "would", "may" and "could" are generally forward-looking in nature and not historical facts. Any statements that refer to expectations or other characterizations of future events, circumstances or results are forward-looking statements.
Various factors that could cause actual future results and other future events to differ materially from those in the forward-looking statements, include, but are not limited to: adverse developments or the absence of sustained improvement in general business, economic or political conditions or the U.S. residential real estate markets, either regionally or nationally, including but not limited to a decline or a lack of improvement in the number of homesales, stagnant or declining home prices or a reduction in the affordability of housing, increasing mortgage rates and/or constraints on the availability of mortgage financing, insufficient or excessive home inventory levels by market and


Exhibit 99.1

price point, a lack of improvement or deceleration in the building of new housing and/or irregular timing or volume of new development closings, the potential negative impact of certain provisions of the Tax Cuts and Jobs Act of 2017 (the "2017 Tax Act") on home values over time in states with high property, sales and state and local income taxes or on homeownership rates, and/or the impact of recessions, slow economic growth, or a deterioration in other economic factors that particularly impact the residential real estate market and the business segments in which we operate whether broadly or by geography and price segments; the impact of increased competition in the industry and for the affiliation of independent sales agents on our results of operations and market share; our ability to successfully develop or procure technology that supports our business strategy; continuing pressure on the share of gross commission income paid by our company owned brokerages and affiliated franchisees to affiliated independent sales agents and sales agent teams; our geographic and high-end market concentration; our inability to enter into franchise agreements with new franchisees or renew existing franchise agreements at current contractual royalty rates without increasing the amount and prevalence of sales incentives; the lack of revenue growth or declining profitability of our franchisees and company owned brokerage operations or declines in other revenue streams, such as third-party listing fees; negative industry or business trends (including further declines in our market capitalization) may have a further impact on our valuation of goodwill and intangibles; the extent of the negative impact of the discontinuation of the USAA program in the third quarter of 2019 on our future revenues and profits derived from affinity program referrals from our Broker Network (including revenue to Cartus, RFG and NRT); the loss of another significant affinity client or multiple significant relocation clients or changes in corporate relocation practices resulting in fewer employee relocations, reduced relocation benefits and/or increasing competition in corporate relocation; an increase in the experienced claims losses of our title underwriter; our failure or alleged failure to comply with laws, regulations and regulatory interpretations and any changes or stricter interpretations of any of the foregoing (whether through private litigation or governmental action), including but not limited to (i) state or federal employment laws or regulations that would require reclassification of independent contractor sales agents to employee status, (ii) privacy or data security laws and regulations, (iii) the Real Estate Settlement Procedures Act (RESPA) or other federal or state consumer protection or similar laws and (iv) antitrust laws and regulations; risks relating to our ability to return capital to stockholders including, among other risks, the restrictions contained in our debt agreements, in particular the indenture governing our 9.375% Senior Notes due 2027; risks associated with our substantial indebtedness and interest obligations and restrictions contained in our debt agreements, including risks relating to having to dedicate a significant portion of our cash flows from operations to service our debt and risks relating to our ability to refinance or repay our indebtedness or incur additional indebtedness; and risks and growing costs related to both cybersecurity threats to our data and customer, franchisee, employee and independent sales agent data, as well as those related to our compliance with the growing number of laws, regulations and other requirements related to the protection of personal information.
Consideration should be given to the areas of risk described above, as well as those risks set forth under the headings "Forward-Looking Statements" and "Risk Factors" in our filings with the Securities and Exchange Commission, including our Quarterly Report on Form 10-Q for the quarters ended March 31, 2019, June 30, 2019 and September 30, 2019 and our Annual Report on Form 10-K for the year ended December 31, 2018, and our other filings made from time to time, in connection with considering any forward-looking statements that may be made by us and our businesses generally. We undertake no obligation to release publicly any revisions to any forward-looking statements, to report events or to report the occurrence of unanticipated events except as required by law.
Non-GAAP Financial Measures
This release includes certain non-GAAP financial measures as defined under SEC rules. As required by SEC rules, important information regarding such measures is contained in the Tables attached to this release. See Tables 1a, 7a and 8 for definitions of these non-GAAP financial measures and Tables 1a, 4a, 4b, 5a, 5b, 6, 7a and 7b for reconciliations of the historical non-GAAP financial measures to their most comparable GAAP terms.
Because of the forward-looking nature of the Company's forecasted non-GAAP financial measures, specific quantifications of the amounts that would be required to reconcile forecasted Operating EBITDA to forecasted net income are not readily determinable. The Company believes that there is a degree of volatility with respect to certain of the Company's GAAP measures which preclude the Company from providing accurate forecasted GAAP


Exhibit 99.1

to non-GAAP reconciliations. Based on the above, the Company believes that providing estimates of the amounts that would be required to reconcile the range of the non-GAAP measures to forecasted GAAP measures would imply a degree of precision that would be confusing or misleading to investors for the reasons identified above.

Investor Contacts:Media Contacts:
Alicia SwiftTrey Sarten
(973) 407-4669(973) 407-2162
alicia.swift@realogy.comtrey.sarten@realogy.com
Danielle KloeblenElliott Frieder
(973) 407-2148(973) 407-5236
danielle.kloeblen@realogy.comelliott.frieder@realogy.com



Realogy Reports Financial Results for Third Quarter 2019      6

Table 1

REALOGY HOLDINGS CORP.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In millions, except per share data)
(Unaudited)
 Three Months Ended
September 30, 
 Nine Months Ended
September 30, 
 
 2019201820192018
Revenues
Gross commission income$1,201  $1,246  $3,310  $3,536  
Service revenue269  268  710  728  
Franchise fees108  109  290  302  
Other51  53  168  159  
Net revenues1,629  1,676  4,478  4,725  
Expenses
Commission and other agent-related costs875  902  2,405  2,556  
Operating388  387  1,158  1,171  
Marketing64  63  202  199  
General and administrative85  80  262  244  
Former parent legacy cost, net —   —  
Restructuring costs, net11   32  45  
Impairments183  —  186  —  
Depreciation and amortization50  49  149  146  
Interest expense, net66  41  210  120  
(Gain) loss on the early extinguishment of debt(10) —  (5)  
Total expenses1,713  1,531  4,600  4,488  
(Loss) income before income taxes, equity in (earnings) losses and noncontrolling interests(84) 145  (122) 237  
Income tax (benefit) expense(8) 40  (9) 73  
Equity in (earnings) losses of unconsolidated entities(7)  (15)  
Net (loss) income(69) 104  (98) 161  
Less: Net income attributable to noncontrolling interests(1) (1) (2) (2) 
Net (loss) income attributable to Realogy Holdings$(70) $103  $(100) $159  
(Loss) earnings per share attributable to Realogy Holdings:
Basic (loss) earnings per share$(0.61) $0.84  $(0.88) $1.26  
Diluted (loss) earnings per share$(0.61) $0.83  $(0.88) $1.25  
Weighted average common and common equivalent shares of Realogy Holdings outstanding:
Basic114.3  122.7  114.2  126.5  
Diluted114.3  123.6  114.2  127.6  



Realogy Reports Financial Results for Third Quarter 2019      7

Table 1a
REALOGY HOLDINGS CORP.
NON-GAAP RECONCILIATION
ADJUSTED NET INCOME AND ADJUSTED EARNINGS PER SHARE
(In millions, except per share data)
We present Adjusted net income and Adjusted earnings per share because we believe these measures are useful as supplemental measures in evaluating the performance of our operating businesses and provides greater transparency into our operating results.
Adjusted net income is defined by us as net (loss) income before: (a) mark-to-market interest rate swap adjustments, whose fair value is subject to movements in LIBOR and the forward yield curve and therefore are subject to significant fluctuations; (b) former parent legacy items, which pertain to liabilities of the former parent for matters prior to mid-2006 and are non-operational in nature; (c) restructuring charges as a result of initiatives currently in progress; (d) the (gain) loss on the early extinguishment of debt that results from refinancing and deleveraging debt initiatives; (e) impairments and (f) the tax effect of the foregoing adjustments. The gross amounts for these items as well as the adjustment for income taxes are shown in the table below.
Adjusted income per share is Adjusted net income divided by the weighted average common and common equivalent shares outstanding.
Set forth in the table below is a reconciliation of Net (loss) income to Adjusted net income for the three and nine months ended September 30, 2019 and 2018:
 Three Months Ended September 30,   Nine Months Ended
September 30, 
 
2019201820192018
Net (loss) income attributable to Realogy Holdings$(70) $103  $(100) $159  
Addback:  
Mark-to-market interest rate swap losses (gains) 12  (7) 50  (19) 
Former parent legacy cost, net   —   —  
Restructuring costs, net  11   32  45  
Impairments (a) 183  —  186  —  
(Gain) loss on the early extinguishment of debt (10) —  (5)  
Adjustments for tax effect (b) (53) (1) (71) (9) 
Adjusted net income attributable to Realogy Holdings$74  $104  $93  $183  
(Loss) earnings per share:
Basic (loss) earnings per share:$(0.61) $0.84  $(0.88) $1.26  
Diluted (loss) earnings per share:$(0.61) $0.83  $(0.88) $1.25  
Adjusted earnings per share:
Adjusted basic earnings per share:$0.65  $0.85  $0.81  $1.45  
Adjusted diluted earnings per share:$0.65  $0.84  $0.81  $1.43  
Weighted average common and common equivalent shares outstanding:
Basic:  114.3  122.7  114.2  126.5  
Diluted:  114.3  123.6  114.2  127.6  
_______________
(a)Impairments for the three months ended September 30, 2019 includes a goodwill impairment charge of $180 million which reduced goodwill at NRT.
(b)Reflects tax effect of adjustments at the Company's blended state and federal statutory rate.



Realogy Reports Financial Results for Third Quarter 2019      8

Table 2
REALOGY HOLDINGS CORP.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In millions, except share data)
(Unaudited)
September 30,
2019
December 31,
2018
ASSETS
Current assets:
Cash and cash equivalents  $266  $225  
Restricted cash  12  13  
Trade receivables (net of allowance for doubtful accounts of $12 and $9) 155  146  
Relocation receivables  268  231  
Other current assets  161  153  
Total current assets  862  768  
Property and equipment, net  315  304  
Operating lease assets, net  538  —  
Goodwill  3,532  3,712  
Trademarks  749  749  
Franchise agreements, net  1,176  1,227  
Other intangibles, net  232  254  
Other non-current assets  313  276  
Total assets  $7,717  $7,290  
LIABILITIES AND EQUITY
Current liabilities:
Accounts payable  $145  $147  
Securitization obligations  228  231  
Current portion of long-term debt  304  748  
Current portion of operating lease liabilities  129  —  
Accrued expenses and other current liabilities  412  401  
Total current liabilities  1,218  1,527  
Long-term debt  3,221  2,800  
Long-term operating lease liabilities  471  —  
Deferred income taxes  374  389  
Other non-current liabilities  250  259  
Total liabilities  5,534  4,975  
Commitments and contingencies
Equity:
Realogy Holdings preferred stock: $0.01 par value; 50,000,000 shares authorized, none issued and outstanding at September 30, 2019 and December 31, 2018  —  —  
Realogy Holdings common stock: $0.01 par value; 400,000,000 shares authorized, 114,335,466 shares issued and outstanding at September 30, 2019 and 114,620,499 shares issued and outstanding at December 31, 2018    
Additional paid-in capital  4,837  4,869  
Accumulated deficit  (2,607) (2,507) 
Accumulated other comprehensive loss  (52) (52) 
Total stockholders' equity2,179  2,311  
Noncontrolling interests    
Total equity2,183  2,315  
Total liabilities and equity$7,717  $7,290  



Realogy Reports Financial Results for Third Quarter 2019      9

Table 3a

REALOGY HOLDINGS CORP.
2019 vs. 2018 KEY DRIVERS
Three Months Ended September 30, Nine Months Ended September 30,
20192018% Change20192018% Change
RFG (a)
Closed homesale sides 299,937  308,917  (3)%803,976  846,185  (5)%
Average homesale price$314,984  $305,398  %$312,224  $304,482  %
Average homesale broker commission rate2.47 %2.47 %—  bps2.47 %2.48 %(1) bps
Net royalty per side$329  $322  %$323  $324  — %
NRT
Closed homesale sides92,399  94,241  (2)%248,092  261,083  (5)%
Average homesale price$509,425  $513,403  (1)%$522,050  $525,738  (1)%
Average homesale broker commission rate2.41 %2.44 %(3) bps2.41 %2.44 %(3) bps
Gross commission income per side$13,000  $13,227  (2)%$13,343  $13,545  (1)%
Cartus
Initiations39,589  42,718  (7)%128,659  133,901  (4)%
Referrals25,085  24,769  %64,105  65,857  (3)%
TRG
Purchase title and closing units41,619  43,836  (5)%111,865  121,766  (8)%
Refinance title and closing units8,014  4,264  88 %17,295  14,456  20 %
Average fee per closing unit$2,288  $2,229  %$2,308  $2,231  %
_______________
(a)Includes all franchisees except for NRT.



Realogy Reports Financial Results for Third Quarter 2019      10

Table 3b

REALOGY HOLDINGS CORP.
2018 KEY DRIVERS
Quarter EndedYear Ended
March 31,
2018
June 30,
2018
September 30,
2018
December 31,
2018
December 31,
2018
RFG (a)
Closed homesale sides 223,990  313,278  308,917  257,672  1,103,857  
Average homesale price$292,580  $312,087  $305,398  $301,345  $303,750  
Average homesale broker commission rate2.50 %2.48 %2.47 %2.47 %2.48 %
Net royalty per side$310  $336  $322  $317  $323  
NRT
Closed homesale sides 66,097  100,745  94,241  75,723  336,806  
Average homesale price $525,020  $537,748  $513,403  $515,452  $523,426  
Average homesale broker commission rate2.45 %2.43 %2.44 %2.42 %2.43 %
Gross commission income per side$13,666  $13,804  $13,227  $13,162  $13,458  
Cartus
Initiations37,953  53,230  42,718  37,541  171,442  
Referrals15,526  25,562  24,769  18,641  84,498  
TRG
Purchase title and closing units31,741  46,189  43,836  35,462  157,228  
Refinance title and closing units5,410  4,782  4,264  4,039  18,495  
Average fee per closing unit$2,161  $2,282  $2,229  $2,227  $2,230  
_______________
(a)Includes all franchisees except for NRT.


Realogy Reports Financial Results for Third Quarter 2019      11

Table 4a
REALOGY HOLDINGS CORP.
NON-GAAP RECONCILIATION - OPERATING EBITDA
THREE MONTHS ENDED SEPTEMBER 30, 2019 AND 2018
(In millions)
Set forth in the tables below is a reconciliation of Net (loss) income to Operating EBITDA for the three-month periods ended September 30, 2019 and 2018:
Three Months Ended September 30,
20192018
Net (loss) income attributable to Realogy Holdings$(70) $103  
Income tax (benefit) expense(8) 40  
(Loss) income before income taxes(78) 143  
Add: Depreciation and amortization50  49  
Interest expense, net66  41  
Restructuring costs, net (a)11   
Impairments (b)183  —  
Former parent legacy cost, net (c) —  
Gain on the early extinguishment of debt (c)(10) —  
Operating EBITDA$223  $242  
The following table reflects Revenue, Operating EBITDA and Operating EBITDA margin by reportable segments:
 Revenues (d)$ Change%
Change
Operating EBITDA$ Change% ChangeOperating EBITDA MarginChange
 201920182019201820192018
RFG$216  $221  $(5) (2)%$153  $161  $(8) (5)%71 %73 %(2) 
NRT
1,222  1,268  (46) (4) 31  43  (12) (28)   —  
Cartus103  108  (5) (5) 34  39  (5) (13) 33  36  (3) 
TRG170  162    31  20  11  55  18  12   
Corporate and Other(82) (83)   (26) (21) (5)  
Total Company$1,629  $1,676  $(47) (3)%$223  $242  $(19) (8)%14 %14 %—  
The following table reflects RFG and NRT results before the intercompany royalties and marketing fees, as well as on a combined basis to show the Operating EBITDA contribution of these business units to the overall Operating EBITDA of the Company:
 Revenues$
Change
%
Change
Operating EBITDA$
Change
%
Change
Operating EBITDA MarginChange
 201920182019201820192018
RFG (e)$134  $138  (4) (3)%$71  $78  (7) (9)%53 %57 %(4) 
NRT (e)1,222  1,268  (46) (4) 113  126  (13) (10)  10  (1) 
RFG and NRT Combined$1,356  $1,406  (50) (4)%$184  $204  (20) (10)%14 %15 %(1) 
_______________
 
 
* not meaningful.
(a)Restructuring charges incurred for the three months ended September 30, 2019 include $1 million at RFG, $8 million at NRT, $1 million at Cartus and $1 million at Corporate and Other. Restructuring charges incurred for the three months ended September 30, 2018 include $1 million at RFG and $8 million at NRT.
(b)Impairments for the three months ended September 30, 2019 includes a goodwill impairment charge of $180 million which reduced goodwill at NRT and $3 million of other impairment charges related to lease asset impairments.
(c)Former parent legacy items and gain on the early extinguishment of debt is recorded in the Corporate and Other section.
(d)Includes the elimination of transactions between segments, which consists of intercompany royalties and marketing fees paid by NRT of $82 million and $83 million during the three months ended September 30, 2019 and 2018, respectively.
(e)The RFG and NRT segment numbers noted above do not reflect the impact of intercompany royalties and marketing fees paid by NRT to RFG of $82 million and $83 million during the three months ended September 30, 2019 and 2018, respectively.



Realogy Reports Financial Results for Third Quarter 2019      12

Table 4b
REALOGY HOLDINGS CORP.
NON-GAAP RECONCILIATION - OPERATING EBITDA
NINE MONTHS ENDED SEPTEMBER 30, 2019 AND 2018
(In millions)
Set forth in the tables below is a reconciliation of Net (loss) income to Operating EBITDA for the nine-month periods ended September 30, 2019 and 2018:
Nine Months Ended September 30,
20192018
Net (loss) income attributable to Realogy Holdings$(100) $159  
Income tax (benefit) expense(9) 73  
(Loss) income before income taxes(109) 232  
Add: Depreciation and amortization (a)149  148  
Interest expense, net210  120  
Restructuring costs, net (b)32  45  
Impairments (c)186  —  
Former parent legacy costs, net (d) —  
(Gain) loss on the early extinguishment of debt (d)(5)  
Operating EBITDA$464  $552  
The following table reflects Revenue, Operating EBITDA and Operating EBITDA margin by reportable segments:
 Revenues (e)$ Change%
Change
Operating EBITDA$ Change% ChangeOperating EBITDA MarginChange
 201920182019201820192018
RFG$613  $634  $(21) (3)%$406  $439  $(33) (8)%66 %69 %(3) 
NRT
3,369  3,593  (224) (6) 16  59  (43) (73) —   (2) 
Cartus276  292  (16) (5) 63  72  (9) (13) 23  25  (2) 
TRG444  444  —  —  54  45   20  12  10   
Corporate and Other(224) (238) 14   (75) (63) (12)  
Total Company$4,478  $4,725  $(247) (5)%$464  $552  $(88) (16)%10 %12 %(2) 
The following table reflects RFG and NRT results before the intercompany royalties and marketing fees, as well as on a combined basis to show the Operating EBITDA contribution of these business units to the overall Operating EBITDA of the Company:
 Revenues$
Change
%
Change
Operating EBITDA$
Change
%
Change
Operating EBITDA MarginChange
 201920182019201820192018
RFG (f)$389  $396  (7) (2)%$182  $201  (19) (9)%47 %51 %(4) 
NRT (f)3,369  3,593  (224) (6) 240  297  (57) (19)   (1) 
RFG and NRT Combined$3,758  $3,989  (231) (6)%$422  $498  (76) (15)%11 %12 %(1) 
_______________
 
 
* not meaningful.
(a)Depreciation and amortization for the nine months ended September 30, 2018 includes $2 million of amortization expense related to Guaranteed Rate Affinity's purchase accounting included in the "Equity in (earnings) losses of unconsolidated entities" line on the Condensed Consolidated Statement of Operations.
(b)Restructuring charges incurred for the nine months ended September 30, 2019 include $1 million at RFG, $18 million at NRT, $5 million at Cartus, $2 million at TRG and $6 million at Corporate and Other. Restructuring charges incurred for the nine months ended September 30, 2018 include $3 million at RFG, $29 million at NRT, $9 million at Cartus, $2 million at TRG and $2 million at Corporate and Other.
(c)Impairments for the nine months ended September 30, 2019 includes a goodwill impairment charge of $180 million which reduced goodwill at NRT and $6 million of other impairment charges primarily related to lease asset impairments.
(d)Former parent legacy items and (gain) loss on the early extinguishment of debt is recorded in the Corporate and Other segment.
(e)Includes the elimination of transactions between segments, which consists of intercompany royalties and marketing fees paid by NRT of $224 million and $238 million during the nine months ended September 30, 2019 and 2018, respectively.
(f)The RFG and NRT segment numbers noted above do not reflect the impact of intercompany royalties and marketing fees paid by NRT to RFG of $224 million and $238 million during the nine months ended September 30, 2019 and 2018, respectively.


Realogy Reports Financial Results for Third Quarter 2019      13

Table 5a
REALOGY HOLDINGS CORP.
SELECTED 2019 FINANCIAL DATA
(In millions)
 Three Months Ended
March 31,June 30,September 30,
201920192019
Net revenues (a)
Real Estate Franchise Services$163  $234  $216  
Company Owned Real Estate Brokerage Services
816  1,331  1,222  
Relocation Services76  97  103  
Title and Settlement Services114  160  170  
Corporate and Other(55) (87) (82) 
Total Company
$1,114  $1,735  $1,629  
Operating EBITDA
Real Estate Franchise Services$90  $163  $153  
Company Owned Real Estate Brokerage Services
(62) 47  31  
Relocation Services 27  34  
Title and Settlement Services(9) 32  31  
Corporate and Other(25) (24) (26) 
Total Company
$(4) $245  $223  
Non-GAAP Reconciliation - Operating EBITDA
Total Company Operating EBITDA$(4) $245  $223  
Less: Depreciation and amortization49  50  50  
Interest expense, net63  81  66  
Income tax (benefit) expense(35) 34  (8) 
Restructuring costs, net (b)12   11  
Impairments (c)  183  
Former parent legacy costs, net (d)—  —   
Loss (gain) on the early extinguishment of debt (d) —  (10) 
Net income (loss) attributable to Realogy Holdings
$(99) $69  $(70) 
_______________
(a)Transactions between segments are eliminated in consolidation. Revenues for the Real Estate Franchise Services segment include intercompany royalties and marketing fees paid by the Company Owned Real Estate Brokerage Services segment of $55 million, $87 million and $82 million for the three months ended March 31, 2019, June 30, 2019 and September 30, 2019, respectively. Such amounts are eliminated through the Corporate and Other line.
Revenues for the Relocation Services segment include $7 million, $11 million and $11 million intercompany referral commissions paid by the Company Owned Real Estate Brokerage Services segment during the three months ended March 31, 2019, June 30, 2019 and September 30, 2019, respectively. Such amounts are recorded as contra-revenues by the Company Owned Real Estate Brokerage Services segment.
(b)Includes restructuring charges broken down by business unit as follows:
 Three Months Ended
March 31,June 30,September 30,
201920192019
Real Estate Franchise Services$—  $—  $ 
Company Owned Real Estate Brokerage Services
   
Relocation Services   
Title and Settlement Services  —  
Corporate and Other   
Total Company
$12  $ $11  
(c)Impairments for the three months ended September 30, 2019 includes a goodwill impairment charge of $180 million which reduced goodwill at NRT and $1 million, $2 million and $3 million of other impairment charges primarily related to lease asset impairments incurred for the three months ended March 31, 2019, June 30, 2019 and September 30, 2019, respectively.
(d)Former parent legacy items and loss (gain) on the early extinguishment of debt is recorded in the Corporate and Other segment.


Realogy Reports Financial Results for Third Quarter 2019      14

Table 5b
REALOGY HOLDINGS CORP.
SELECTED 2018 FINANCIAL DATA
(In millions)
 Three Months EndedYear Ended
 March 31,June 30,September 30,December 31,December 31,
20182018201820182018
Net revenues (a)
Real Estate Franchise Services$176  $237  $221  $186  $820  
Company Owned Real Estate Brokerage Services
917  1,408  1,268  1,014  4,607  
Relocation Services79  105  108  86  378  
Title and Settlement Services120  162  162  136  580  
Corporate and Other(63) (92) (83) (68) (306) 
Total Company
$1,229  $1,820  $1,676  $1,354  $6,079  
Operating EBITDA
Real Estate Franchise Services$105  $173  $161  $125  $564  
Company Owned Real Estate Brokerage Services
(45) 61  43  (15) 44  
Relocation Services(1) 34  39  14  86  
Title and Settlement Services(6) 31  20   49  
Corporate and Other(19) (23) (21) (22) (85) 
Total Company
$34  $276  $242  $106  $658  
Non-GAAP Reconciliation - Operating EBITDA
Total Company Operating EBITDA$34  $276  $242  $106  $658  
Less: Depreciation and amortization (b)50  49  49  49  197  
Interest expense, net33  46  41  70  190  
Income tax (benefit) expense (19) 52  40  (8) 65  
Restructuring costs, net (c)30    13  58  
Former parent legacy cost, net (d)—  —  —    
Loss on the early extinguishment of debt (d) —  —  —   
Net income (loss) attributable to Realogy Holdings
$(67) $123  $103  $(22) $137  
_______________
(a)Transactions between segments are eliminated in consolidation. Revenues for the Real Estate Franchise Services segment include intercompany royalties and marketing fees paid by the Company Owned Real Estate Brokerage Services segment of $63 million, $92 million, $83 million and $68 million for the three months ended March 31, 2018, June 30, 2018, September 30, 2018 and December 31, 2018, respectively. Such amounts are eliminated through the Corporate and Other line.
Revenues for the Relocation Services segment include $8 million, $12 million, $10 million and $9 million of intercompany referral commissions paid by the Company Owned Real Estate Brokerage Services segment during the three months ended March 31, 2018, June 30, 2018, September 30, 2018 and December 31, 2018, respectively. Such amounts are recorded as contra-revenues by the Company Owned Real Estate Brokerage Services segment.
(b)Depreciation and amortization for the three months ended March 31, 2018 includes $2 million of amortization expense related to our mortgage origination joint venture Guaranteed Rate Affinity's purchase accounting included in the "Equity in losses (earnings) of unconsolidated entities" line on the Condensed Consolidated Statement of Operations.
(c)Includes restructuring charges broken down by business unit as follows:
 Three Months EndedYear Ended
 March 31,June 30,September 30,December 31,December 31,
2018  2018  201820182018
Real Estate Franchise Services$ $—  $ $—  $ 
Company Owned Real Estate Brokerage Services
17     37  
Relocation Services  —   11  
Title and Settlement Services  —    
Corporate and Other —  —