Guild Company (GHLD) Q2 2024 earnings summary

Executive summary

• Q2 2024 originations surged 69% sequentially to $6.5B, with 92% from purchase loans, outpacing the industry’s 14% growth.

• Net income attributable to shareholders was $37.6M ($0.60 per diluted share), and adjusted net income was $30.7M ($0.49 per share), both up sharply from Q1.

• Integration of Academy Mortgage and launch of GuildGPT AI platform supported operational growth and expanded origination capacity.

• Return on equity improved to 12.3% in Q2 2024; adjusted return on equity was 10.1%.

• Paid a special dividend of $0.50 per share in Q2 2024.

Financial highlights

• Net revenue for Q2 2024 was $285.7M, up from $231.8M in Q1; YTD revenue was $517.5M, up 52% year-over-year.

• Adjusted EBITDA for Q2 2024 was $41.6M, up 161% sequentially; YTD adjusted EBITDA was $57.5M, up 225% year-over-year.

• Gain on sale margin was 326 bps in Q2 2024, down from 364 bps in Q1; YTD margin is 340 bps.

• Servicing portfolio UPB grew to $89.1B, up 3% sequentially and 9% year-over-year.

• Servicing segment Q2 net income was $69.5M, down from $83.9M in Q1, with MSR valuation gains of $2.1M.

Outlook and guidance

• Management expects continued organic growth, supported by technology investments and selective acquisitions, with margin improvement anticipated as market demand recovers.

• Liquidity is expected to remain sufficient for at least the next 12 months, supported by cash flow, warehouse lines, and notes payable.

• No significant changes expected in gain on sale margins near term.