First National Financial (FN) Q4 2023 earnings summary

Executive summary

• Record mortgages under administration (MUA) of $143.5B at year-end, up 10% YoY; annual revenue rose 29% and Pre-FMV Income rose 54%.

• 2023 originations including renewals nearly matched the 2022 record; commercial originations exceeded $13B, a record annual level.

Financial highlights

• FY 2023 revenue was $2.024B vs. $1.574B in 2022; Q4 revenue was $503.4M vs. $414.8M YoY.

• FY net income was $252.8M ($4.15/share) vs. $197.7M ($3.25/share); Q4 net income was $44.2M ($0.72/share) vs. $42.7M ($0.70/share).

• FY income before taxes increased 28% to $343.9M; Q4 income before taxes was $59.9M vs. $58.3M YoY.

Outlook and guidance

• Lower single-family originations are expected to start 2024, reflecting affordability challenges and a more competitive market; longer-term housing demand is expected to benefit from higher immigration.

• Commercial origination is expected to start strongly, supported by multi-unit housing initiatives and expansion of the CMB program from $40B to $60B.

• Expected income and cash flow sources include the $39B securitized mortgage portfolio, $101B servicing portfolio and the single-family renewal book.