OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The next dialogue and evaluation ought to be learn together with our
condensed consolidated monetary statements ("monetary statements") and
accompanying notes included in Merchandise 1 of Half I of this Quarterly Report on Kind
10-Q and with our audited consolidated monetary statements and accompanying
notes included in our most up-to-date Annual Report on Kind 10-Okay for the yr ended
December 31, 2021 ("2021 Annual Report on Kind 10-Okay").
This Quarterly Report on Kind 10-Q incorporates "forward-looking statements" inside
the that means of Part 27A of the Securities Act of 1933 and Part 21E of the
Securities Alternate Act of 1934, as amended (the "Alternate Act"). These
statements are sometimes recognized by way of phrases comparable to "imagine," "intend,"
"anticipate," "estimate," "plan," "outlook," "challenge," "anticipate," "could," "will,"
"would" and different comparable phrases and expressions that predict or point out future
occasions or traits that aren't statements of historic issues. Ahead-looking
statements embody statements associated to: agent depend; franchise gross sales; our
enterprise mannequin; value construction; steadiness sheet; income; working bills;
monetary outlook; return of capital, together with dividends and our share
repurchase program; non-GAAP monetary measures; housing and mortgage market
situation and traits; financial and demographic traits; competitors; the
anticipated advantages our know-how initiatives; our anticipated sources and
makes use of of liquidity together with for potential acquisitions; capital expenditures;
future litigation bills regarding the Moehrl-related fits; our strategic
and working plans and enterprise fashions together with our efforts to speed up the
development of our companies; and the anticipated affect of acquisitions.
Ahead-looking statements shouldn't be learn as a assure of future
efficiency or outcomes and won't essentially precisely point out the occasions at
which such efficiency or outcomes could also be achieved. Ahead-looking statements
are based mostly on data obtainable on the time these statements are made and/or
administration's good religion perception as of that point with respect to future occasions and
are topic to dangers and uncertainties that would trigger precise efficiency or
outcomes to vary materiality from these expressed in or prompt by the
forward-looking statements. Components that would trigger or contribute to such
variations embody, however will not be restricted to, these recognized herein, and people
mentioned within the part titled "Threat Components," set forth in Half II, Merchandise 1A of
this Quarterly Report on Kind 10-Q and in Half I, Merchandise 1A of our 2021 Annual
Report on Kind 10-Okay. Readers are cautioned to not place undue reliance on
forward-looking statements, which communicate solely as of the date of this report.
Besides as required by regulation, we don't intend, and we undertake no obligation to
replace any forward-looking statements to mirror occasions or circumstances after
the date of such statements.
The outcomes of operations mentioned on this "Administration's Dialogue and
Evaluation of Monetary Situation and Outcomes of Operations" are these of RE/MAX
Holdings, Inc. ("Holdings") and its consolidated subsidiaries, together with RMCO,
LLC and its consolidated subsidiaries ("RMCO"), collectively, the "Firm,"
"we," "our" or "us."
Enterprise Overview
We're one of many world's main franchisors in the true property {industry}. We
franchise actual property brokerages globally below the RE/MAX model ("RE/MAX") and
mortgage brokerages within the U.S. below the Motto Mortgage model ("Motto"). We
additionally promote ancillary services and products, primarily know-how, to our
franchise networks and, in sure cases, we promote these choices exterior
our franchise networks. We set up our enterprise based mostly on the providers we
present in Actual Property, Mortgage and our collective franchise advertising
operations, often known as the Advertising and marketing Funds. RE/MAX and Motto are 100%
franchised-we don't personal any of the brokerages that function below these manufacturers.
We give attention to enabling our networks' success by offering highly effective know-how,
high quality schooling and coaching, and beneficial advertising to construct the power of
the RE/MAX and Motto manufacturers. We help our franchisees in rising their
brokerages, though they fund the price of creating their brokerages. As a
end result, we keep a low fixed-cost construction which, mixed with our
recurring fee-based mannequin, permits us to capitalize on the financial advantages of
the franchising mannequin, yielding excessive margins and important money move.
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Monetary and Operational Highlights – Three Months Ended
(In comparison with the three months ended
? Complete income of
Income excluding the Advertising and marketing Funds (a) elevated to
? which was comprised of 10.5% natural development, 15.1% development attributable to
acquisitions and 0.3% development from international foreign money actions (b).
? Web revenue (loss) attributable to
million
Adjusted EBITDA of
? to Adjusted EBITDA of
the prior yr.
? Complete agent depend elevated by 1.6% to 142,405 brokers.
?
? Complete open Motto Mortgage workplaces elevated 27.3% to 191 workplaces.
(a)
Income excluding the Advertising and marketing Funds is a non-GAAP measure of monetary efficiency that differs from theU.S. Usually Accepted Accounting Rules. Income excluding the Advertising and marketing Funds is calculated instantly from our consolidated monetary statements as Complete income much less Advertising and marketing Funds charges. (b) We outline natural income development as income development from persevering with operations excluding Advertising and marketing Funds, income attributable to acquisitions, and international foreign money actions. We outline income from acquisitions because the incremental income generated from the date of an acquisition to its first anniversary (excluding Advertising and marketing Funds income associated to acquisitions the place relevant). We proceed to guage the perfect alternatives, each natural and inorganic, to drive our near- and longer-term development. We've got two sturdy, industry-leading franchise manufacturers, every with their very own compelling development alternatives. Inside these manufacturers, our focus is totally on figuring out and implementing these strategic initiatives which ought to assist us enhance ourU.S. agent depend and speed up the enlargement of our rising Mortgage enterprise.
Chosen Working and Monetary Highlights
The next tables summarize a number of key efficiency indicators and our
outcomes of operations.
As of March 31, 2022 vs. 2021
2022 2021 # %
Agent Rely:
U.S. 60,717 62,261 (1,544) (2.5) %
Canada 24,443 22,510 1,933 8.6 %
Subtotal 85,160 84,771 389 0.5 %
Outdoors U.S. and Canada 57,245 55,443 1,802 3.3 %
Complete 142,405 140,214 2,191 1.6 %
Motto open workplaces (2) 191 150 41 27.3 %
Three Months Ended March 31, 2022 vs. 2021
2022 2021 # %
RE/MAX franchise gross sales (1) 177 166 11 6.6 %
Motto franchise gross sales (2) 17 9 8 88.9 %
(1) Contains franchise gross sales within the
(2) Excludes “digital” workplaces and BranchiseSM workplaces.
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Three Months Ended
March 31,
2022 2021
Complete income $ 91,004 $ 72,295
Complete promoting, working and administrative bills $ 47,831 $ 43,676
Working revenue (loss) $ 7,602 $ 3,666
Web revenue (loss) $ 2,945 $ 1,763
Web revenue (loss) attributable to RE/MAX Holdings, Inc. $ 1,451 $ 1,163
Adjusted EBITDA (1) $ 27,917 $ 23,160
Adjusted EBITDA margin (1) 30.7 % 32.0 %
See “-Non-GAAP Monetary Measures” for additional dialogue of Adjusted EBITDA
and Adjusted EBITDA margin and a reconciliation of the variations between
(1) Adjusted EBITDA and web revenue (loss), which is essentially the most comparable
usually accepted accounting ideas (“
efficiency. Adjusted EBITDA margin represents Adjusted EBITDA as a
proportion of whole income.
Outcomes of Operations
Comparability of the Three Months Ended
Income
A abstract of the elements of our income is as follows (in 1000's besides
percentages):
Three Months Ended Change
March 31, Favorable/(Unfavorable)
2022 2021 $ %
Income:
Persevering with franchise charges $ 33,499 $ 25,374 $ 8,125 32.0 %
Annual dues 8,920 8,672 248 2.9 %
Dealer charges 15,085 11,953 3,132 26.2 %
Advertising and marketing Funds charges 22,851 18,145 4,706 25.9 %
Franchise gross sales and different income 10,649 8,151 2,498 30.6 %
Complete income $ 91,004 $ 72,295 $ 18,709 25.9 %
Three Months Ended Change
March 31, Favorable/(Unfavorable)
2022 2021 $ %
Income excluding the Advertising and marketing Funds:
Complete income $ 91,004 $ 72,295 $ 18,709 25.9 %
Much less: Advertising and marketing Funds charges 22,851 18,145 4,706 25.9 %
Income excluding the Advertising and marketing Funds $ 68,153 $ 54,150 $ 14,003 25.9 %
Income excluding the Advertising and marketing Funds elevated to $68.2 million or 25.9%, which
was comprised of 10.5% natural development, 15.1% development from acquisitions and 0.3%
development from international foreign money actions. Natural development elevated primarily due
to elevated event-based income as a consequence of larger attendance at our annual RE/MAX
agent conference, elevated Dealer charges as a consequence of rising residence costs, incremental
income from fewer agent recruiting initiatives, a worth enhance in RE/MAX
Persevering with franchise charges, and Motto development. Income development from acquisitions
was attributable to income from the RE/MAX INTEGRA North American areas
acquisition ("INTEGRA") accomplished in July 2021 . Consolidated income elevated
as a result of aforementioned elements plus development in Advertising and marketing Funds charges primarily
from the INTEGRA acquisition.
Persevering with Franchise Charges
Income from Persevering with franchise charges elevated primarily as a consequence of contributions
from the acquisition of INTEGRA, incremental income from fewer agent recruiting
initiatives, a worth enhance in RE/MAX and Motto development.
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Dealer Charges
Income from Dealer charges elevated primarily from the acquisition of INTEGRA and
rising residence costs, partially offset by decrease whole transactions per agent as
in comparison with the prior yr.
Advertising and marketing Funds Charges
Income from Advertising and marketing Funds charges elevated primarily from the acquisition of
INTEGRA and fewer agent recruiting initiatives within the present yr.
Franchise Gross sales and Different Income
Franchise gross sales and different income elevated primarily as a consequence of larger attendance
at our annual RE/MAX agent conference.
Working Bills
A abstract of the elements of our working bills is as follows (in
1000’s, besides percentages):
Three Months Ended Change
March 31, Favorable/(Unfavorable)
2022 2021 $ %
Working bills:
Promoting, working and administrative bills$ 47,831 $ 43,676 $ (4,155) (9.5) % Advertising and marketing Funds bills 22,851 18,145 (4,706) (25.9) % Depreciation and amortization 8,985 6,808 (2,177) (32.0) % Settlement and impairment fees 3,735 - (3,735) n/m Complete working bills$ 83,402 $ 68,629 $
(14,773) (21.5) % % of income 91.6 % 94.9 % n/m - not significant
Promoting, working and administrative bills consists of personnel prices, skilled payment bills, lease prices and different bills. Different bills inside Promoting, working and administrative bills embody sure advertising and manufacturing prices that aren't paid by the Advertising and marketing Funds, together with journey and leisure prices, and prices related to our annual conventions within theU.S. and different occasions and know-how providers. Three Months Ended Change March 31, Favorable/(Unfavorable) 2022 2021 $ % Promoting, working and administrative bills: Personnel$ 26,710 $ 28,333 $ 1,623 5.7 % Skilled charges 4,788 4,254 (534) (12.6) % Lease prices 2,328 2,083 (245) (11.8) % Different 14,005 9,006 (4,999) (55.5) % Complete promoting, working and administrative bills$ 47,831 $ 43,676 $ (4,155) (9.5) % % of income 52.6 % 60.4 % n/m - not significant
Complete Promoting, working and administrative bills elevated as follows:
Personnel prices decreased primarily as a consequence of decrease equity-based compensation
expense, pushed by
one-time acceleration of sure fairness awards throughout the first quarter of
? 2021, see Observe 11, Fairness-Based mostly Compensation. This lower in equity-based
compensation was partially offset by elevated headcount, together with from acquisitions, larger prices related to buying and integrating new corporations, and the reinstatement of the complete 401(okay) match.
Skilled charges elevated primarily as a consequence of a rise in authorized charges. See
part titled “Authorized Proceedings,” set forth in Half II, Merchandise 1 of this
? Quarterly Report on Kind 10-Q. We anticipate to incur a further
the rest of this yr due to this ongoing litigation.
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Different promoting, working and administrative bills elevated primarily due
? larger journey and occasions bills, primarily associated to our annual RE/MAX agent
conference, and elevated investments in know-how.
Advertising and marketing Funds Bills
We acknowledge an equal and offsetting quantity of bills to income such that
there isn’t a affect to our general profitability.
Depreciation and Amortization
Depreciation and amortization expense elevated primarily as a consequence of new
amortization associated to our acquisitions.
Settlement and Impairment Fees
Impairment Cost – Leased Property
In the course of the first quarter of 2022, we subleased a portion of our company
headquarters. Consequently, we carried out an impairment check on the portion
subleased and acknowledged an impairment cost of
2, Abstract of Vital Accounting Insurance policies for extra details about
our leases.
Different Bills, Web
A abstract of the elements of our Different bills, web is as follows (in
1000’s, besides percentages):
Three Months Ended Change
March 31, Favorable/(Unfavorable)
2022 2021 $ %
Different bills, web:
Curiosity expense $ (3,651) $ (2,098) $ (1,553) (74.0) %
Curiosity revenue 19 163 (144) (88.3) %
Overseas foreign money transaction beneficial properties (losses) 180 (20) 200 n/m Complete different bills, web$ (3,452) $ (1,955) $ (1,497) (76.6) % % of income 3.8 % 2.7 % n/m - not significant Different bills, web elevated primarily as a consequence of a rise in curiosity expense due to the refinance of and enhance to our Senior Secured Credit score Facility (see Observe 8, Debt, for extra data) within the prior yr. Overseas foreign money transaction beneficial properties (losses) are primarily the results of transactions denominated within the Canadian Greenback. Provision for Revenue Taxes
Our efficient revenue tax charge elevated to 29.0% from (3.0)% for the three months endedMarch 31, 2022 and 2021, respectively, primarily pushed by the vesting of fairness based mostly compensation throughout the three months endedMarch 31, 2022 the place the tax deductible expense was lower than the GAAP expense, as in comparison with extra tax deductible expense as in comparison with GAAP expense associated to vested fairness awards within the three months endedMarch 31, 2021 . Our efficient revenue tax charge depends upon many elements, together with a charge profit attributable to the truth that the portion ofRMCO's earnings attributable to the non-controlling pursuits will not be topic to corporate-level taxes as a result ofRMCO is assessed as a partnership forU.S. federal revenue tax functions and subsequently is handled as a "flow-through entity," in addition to annual adjustments in state and international revenue tax charges. See Observe 3, Non-controlling Curiosity to the accompanying unaudited condensed consolidated monetary statements for additional particulars on the allocation of revenue taxes between Holdings and the non-controlling curiosity and see Observe 10, Revenue Taxes for extra data.
Adjusted EBITDA
See “-Non-GAAP Monetary Measures” for our definition of Adjusted EBITDA and for
additional dialogue of our presentation of Adjusted EBITDA in addition to a
reconciliation of Adjusted EBITDA to web revenue (loss), which is essentially the most
comparable GAAP measure for working efficiency.
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Adjusted EBITDA was$27.9 million for the three months endedMarch 31, 2022 , an enhance of$4.8 million from the comparable prior yr interval. Adjusted EBITDA elevated primarily as a consequence of contributions from the INTEGRA acquisition, larger Dealer charges income as a consequence of rising residence costs, incremental income from fewer agent recruiting initiatives, and a worth enhance in RE/MAX Persevering with franchise charges, partially offset by larger personnel prices as a consequence of headcount will increase and the reinstatement of the complete 401(okay) match.
Non-GAAP Monetary Measures
The Securities and Alternate Fee ("SEC") has adopted guidelines to control the use in filings with theSEC and in public disclosures of monetary measures that will not be in accordance withU.S. GAAP, comparable to Income excluding the Advertising and marketing Funds and Adjusted EBITDA and the ratios associated thereto. These measures are derived on the premise of methodologies aside from in accordance withU.S. GAAP.
Income excluding the Advertising and marketing Funds is a non-GAAP measure of monetary
efficiency that differs from the
Income excluding the Advertising and marketing Funds is calculated instantly from our
consolidated monetary statements as Complete income much less Advertising and marketing Funds charges.
We outline Adjusted EBITDA as EBITDA (consolidated web revenue (loss) earlier than depreciation and amortization, curiosity expense, curiosity revenue and the provision for revenue taxes, every of which is offered in our unaudited condensed consolidated monetary statements included elsewhere on this Quarterly Report on Kind 10-Q), adjusted for the affect of the next objects which are both non-cash or that we don't take into account consultant of our ongoing working efficiency: achieve or loss on sale or disposition of belongings, settlement and impairment fees, equity-based compensation expense, acquisition-related expense, achieve or losses from adjustments within the tax receivable settlement legal responsibility, expense or revenue associated to adjustments within the estimated truthful worth measurement of contingent consideration and different non-recurring objects. As Adjusted EBITDA omits sure non-cash objects and different non-recurring money fees or different objects, we imagine that it's much less vulnerable to variances that have an effect on our working efficiency ensuing from depreciation, amortization and different non-cash and non-recurring money fees or different objects. We current Adjusted EBITDA, and the associated Adjusted EBITDA margin, as a result of we imagine they are helpful as supplemental measures in evaluating the efficiency of our working companies and supplies higher transparency into our outcomes of operations. Our administration makes use of Adjusted EBITDA and Adjusted EBITDA margin as elements in evaluating the efficiency of our enterprise. Adjusted EBITDA and Adjusted EBITDA margin have limitations as analytical instruments, and you shouldn't take into account these measures both in isolation or as a substitute for analyzing our outcomes as reported belowU.S. GAAP. A few of these limitations are:
? these measures don’t mirror adjustments in, or money necessities for, our working
capital wants;
? these measures don’t mirror our curiosity expense, or the money necessities
essential to service curiosity or principal funds on our debt;
? these measures don’t mirror our revenue tax expense or the money necessities
to pay our taxes;
these measures don’t mirror the money necessities to pay dividends to
? stockholders of our Class A typical inventory and tax and different money distributions
to our non-controlling unitholders;
? these measures don’t mirror the money necessities pursuant to the Tax
Receivable Agreements (“TRAs”);
? these measures don’t mirror the money necessities for share repurchases
though depreciation and amortization are non-cash fees, the belongings being
? depreciated and amortized will typically require substitute sooner or later, and
these measures don’t mirror any money necessities for such replacements;
? though equity-based compensation is a non-cash cost, the issuance of
equity-based awards could have a dilutive affect on earnings per share; and
? different corporations could calculate these measures in a different way, so equally named
measures is probably not comparable.
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A reconciliation of Adjusted EBITDA to web revenue (loss) is ready forth within the
following desk (in 1000’s):
Three Months Ended
March 31,
2022 2021
Web revenue (loss) $ 2,945 $ 1,763
Depreciation and amortization 8,985 6,808
Curiosity expense 3,651 2,098
Curiosity revenue (19) (163)
Provision for revenue taxes 1,205 (52)
EBITDA 16,767 10,454
Impairment cost - leased belongings (1) 3,735
–
Fairness-based compensation expense 5,637
12,054
Acquisition-related expense (2) 1,257
943
Honest worth changes to contingent consideration (2) 285 (280) Different 236 (11) Adjusted EBITDA$ 27,917 $ 23,160
Represents the impairment acknowledged on a portion of the Firm’s company
(1) headquarters workplace constructing. See Observe 2, Abstract of Vital Accounting
Insurance policies for extra data.
Acquisition-related expense consists of personnel, authorized, accounting, advisory
(2) and consulting charges incurred in reference to the analysis, due
diligence, execution and integration of acquisitions.
Honest worth changes to contingent consideration embody quantities acknowledged
for adjustments within the estimated truthful worth of the contingent consideration
(3) liabilities. See Observe 9, Honest Worth Measurements to the accompanying
unaudited condensed consolidated monetary statements for extra
data.
Liquidity and Capital Assets
Overview of Components Affecting Our Liquidity
Our liquidity place is affected by the expansion of our franchise networks and circumstances in the true property market. On this regard, our short-term liquidity place on occasion has been, and can proceed to be, affected by a number of elements together with brokers within the RE/MAX community, significantly in Firm-Owned Areas and open workplaces within the Motto community. Our money flows are primarily associated to the timing of:
(i) money receipt of revenues;
(ii) cost of promoting, working and administrative bills;
(iii) investments in know-how and the expansion of our mortgage enterprise;
(iv) money consideration for acquisitions and acquisition-related bills;
(v) principal funds and associated curiosity funds on our Senior Secured Credit score
Facility;
(vi) dividend funds to stockholders of our Class A typical inventory;
distributions and different funds to non-controlling unitholders pursuant to
(vii) the phrases of
(viii) company tax funds paid by the Firm;
(ix) funds to the TRA events pursuant to the TRAs; and
(x) share repurchases.
We've got happy these wants primarily by way of our present money balances, money
generated by our operations and funds obtainable below our Senior Secured Credit score
Facility. We may additionally make the most of our Senior Secured Credit score Facility, and we could
pursue different sources of capital which will embody different types of exterior
financing, comparable to extra financing within the public capital markets, so as
to extend our money place and protect monetary flexibility as wants come up.
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Financing Assets
RMCO and RE/MAX, LLC , a completely owned subsidiary of RMCO , have a credit score settlement
with JPMorgan Chase Financial institution, N.A ., as administrative agent, and numerous lenders
celebration thereto (the "Senior Secured Credit score Facility"). On July 21, 2021 , we
amended and restated our Senior Secured Credit score Facility to fund the acquisition
of INTEGRA and refinance our present facility. The revised facility supplies
for a seven-year $460.0 million time period mortgage facility and a five-year $50.0 million
revolving mortgage facility. The revised facility additionally supplies for incremental
amenities below which RE/MAX, LLC could request so as to add a number of tranches of
time period amenities or enhance any then present credit score facility within the mixture
principal quantity of as much as $100 million (or a better quantity topic to the phrases
and circumstances of the Senior Secured Credit score Facility), topic to lender
participation.
The Senior Secured Credit score Facility requires RE/MAX, LLC to repay time period loans at
$1.2 million per quarter. We're additionally required to repay the time period loans and
cut back revolving commitments with (i) 100.0% of proceeds of any incurrence of
extra debt not permitted by the Senior Secured Credit score Facility, (ii) 100.0%
of proceeds of asset gross sales and 100.0% of quantities recovered below insurance coverage
insurance policies, topic to sure exceptions and a reinvestment proper and (iii) 50%
of Extra Money Move (or "ECF" as outlined within the Senior Secured Credit score Facility)
on the finish of the relevant fiscal yr if RE/MAX, LLC's Complete Leverage Ratio
(or "TLR" as outlined within the Senior Secured Credit score Facility) is in extra of
4.25:1. If the TLR as of the final day of such fiscal yr is the same as or much less
than 4.25:1 however above 3.75:1, the reimbursement proportion is 25% of ECF and if the
TLR as of the final day of such fiscal yr is lower than 3.75:1, no reimbursement
from ECF is required.
The Senior Secured Credit score Facility is assured by
lien on considerably the entire belongings of
corporations.
The Senior Secured Credit score Facility supplies for customary restrictions on, amongst different issues, extra indebtedness, liens, inclinations of property, dividends, transactions with associates and basic adjustments comparable to mergers, consolidations and liquidations. With sure exceptions, any default below any of our different agreements evidencing indebtedness within the quantity of$15.0 million or extra constitutes an occasion of default below the Senior Secured Credit score Facility. Borrowings below the time period loans and revolving loans accrue curiosity, at our choice on (a) LIBOR, offered LIBOR shall be at least 0.50% plus an relevant margin of two.50% and, offered additional that such charge shall be adjusted for reserve necessities for eurocurrency liabilities, if any (the "LIBOR Fee") or (b) the best of (i) the prime charge as quoted by theWall Road Journal , (ii) the NYFRB Fee (as outlined within the Senior Secured Credit score Facility) plus 0.50% and (iii) the one-month Eurodollar Fee plus 1.00%, (such biggest charge, the "ABR") plus, in every case, an relevant margin of 1.50%. As ofMarch 31, 2022 , the rate of interest on the time period mortgage facility was 3.0%.
A dedication payment of 0.5% each year (topic to reductions) accrues on the quantity
of unutilized revolving line of credit score.
As of
unamortized low cost and issuance prices, and no revolving loans excellent
below our Senior Secured Credit score Facility.
Sources and Makes use of of Money
As of
million
currencies.
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The next desk summarizes our money flows from working, investing, and
financing actions (in 1000’s):
Three Months Ended
March 31,
2022 2021
Money offered by (utilized in):
Working actions $ 16,502 $ 20,832
Investing actions (3,723) (4,381)
Financing actions (16,068) (13,638)
Impact of change charge adjustments on money 274
92
Web change in money, money equivalents and restricted money
Working Actions
Money offered by working actions decreased primarily because of:
? larger funds of sure worker associated liabilities;
? a rise in Adjusted EBITDA of
? a lower as a consequence of larger curiosity funds of
of our Senior Secured Credit score Facility in
? timing variations on numerous working belongings and liabilities.
Investing Actions
In the course of the three months ended
offered by investing actions was primarily as a consequence of decrease investments on our
company headquarters refresh.
Financing Actions
In the course of the three months endedMarch 31, 2022 , the change in money offered by (utilized in) financing actions was primarily as a result of initiation of our share repurchase program and a rise in principal funds on our Senior Secured Credit score Facility.
Capital Allocation Priorities
Liquidity
Our goal is to keep up a powerful liquidity place. We've got present money balances, money flows from working actions, entry to our revolving facility and incremental amenities below our Senior Secured Credit score Facility obtainable to help the wants of our enterprise. As wants come up, we could search extra financing within the public capital markets.
Acquisitions
As a part of our development technique, we could pursue acquisitions of Unbiased Areas within theU.S. andCanada in addition to extra acquisitions or investments in complementary companies, providers and applied sciences that would offer entry to new markets, income streams, or in any other case complement or speed up the development of our present operations. We could fund any such development with numerous sources of capital together with present money balances and money move from operations, in addition to proceeds from debt financings together with below present credit score amenities or new preparations raised within the public capital markets.
Capital Expenditures
The entire mixture quantity for purchases of property and tools and capitalization of developed software program was$3.7 million and$4.4 million throughout the three months endedMarch 31, 2022 and 2021, respectively. These quantities primarily relate to spend on our company headquarters refresh and investments in know-how. With the intention to develop our know-how, we plan to proceed to re-invest in our enterprise in an effort to enhance operational efficiencies and improve the instruments and providers offered to the associates in our networks. Complete capital expenditures for 2022 are anticipated to be between$10 million and$13 million . 30 Desk of Contents Return of Capital
Return of capital to shareholders is one among our main capital allocation priorities. Our Board of Administrators declared and we paid quarterly money dividends of$0.23 per share on all excellent shares of Class A typical inventory throughout the first quarter of 2022. OnApril 27, 2022 , our Board of Administrators declared a quarterly money dividend of$0.23 per share on all excellent shares of Class A frequent inventory, which was payable onCould 25, 2022 to stockholders of file on the shut of enterprise onCould 11, 2022 . Our Board of Administrators has licensed a typical inventory repurchase program of as much as$100 million . In the course of the three months endedMarch 31, 2022 , 45,885 million shares of our Class A typical inventory had been repurchased and retired for$1.3 million excluding commissions, at a mean value of$28.63 . As ofMarch 31, 2022 ,$98.7 million remained obtainable below the share repurchase authorization. Future capital allocation choice with respect to return of capital both in the type of extra future dividends, and if declared, the quantity of any such future dividend, or within the type of share repurchases, can be topic to our precise future earnings and capital necessities and any quantities licensed will be on the discretion of our Board of Administrators.
Distributions and Different Funds to Non-controlling Unitholders by
Distributions and different funds pursuant to the
had been comprised of the next (in 1000’s):
Three Months Ended
March 31,
2022 2021
Distributions and different funds pursuant to the
Professional rata distributions to RIHI because of distributions to
Holdings
$ 5 $ - Dividend distributions 2,889 2,889 Complete distributions to RIHI 2,894 2,889 Funds pursuant to the TRAs - - Complete distributions to RIHI and TRA funds $
2,894
Commitments and Contingencies
See Observe 12, Commitments and Contingencies to the accompanying unaudited
condensed consolidated monetary statements for extra data.
Off Steadiness Sheet Preparations
We’ve got no materials off steadiness sheet preparations as of
Essential Accounting Judgments and Estimates
The preparation of monetary statements in conformity withU.S. GAAP requires administration to make estimates and assumptions that have an effect on the quantities and disclosures within the monetary statements and accompanying notes. Precise outcomes might differ from these estimates. Our Essential Accounting Judgments and Estimates disclosed in "Administration's Dialogue and Evaluation of Monetary Situation and Outcomes of Operations - Essential Accounting Judgments and Estimates" in our 2021 Annual Report on Kind 10-Okay for which there have been no materials adjustments, included: ? MottoGoodwill
? Buy Accounting for Acquisitions
? Deferred Tax Property and TRA Legal responsibility
New Accounting Pronouncements
See Observe 2, Abstract of Vital Accounting Insurance policies to the accompanying
unaudited condensed consolidated monetary statements for extra
data.
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