☒ | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
☐ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Delaware | 35-2478370 | |
(State or Other Jurisdiction of Incorporation or Organization) | (I.R.S. Employer | |
Identification No.) | ||
23975 Park Sorrento, Suite 400 Calabasas, California | 91302 | |
(Address of Principal Executive Offices) | (Zip Code) |
Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||
Common Stock, par value $0.0001 per share | MMI | New York Stock Exchange |
Large accelerated filer | ☒ | Accelerated filer | ☐ | |||||||
Non-accelerated filer | ☐ | Smaller reporting company | ☐ | |||||||
Emerging growth company | ☐ |
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June 30, 2020 (Unaudited) | December 31, 2019 | June 30, 2021 (Unaudited) | December 31, 2020 | |||||||||||||
Assets | ||||||||||||||||
Current assets: | ||||||||||||||||
Cash and cash equivalents | $ | 154,880 | $ | 232,670 | $ | 230,414 | $ | 243,152 | ||||||||
Commissions receivable, net | 4,956 | 5,003 | 14,954 | 10,391 | ||||||||||||
Prepaid expenses | 8,391 | 10,676 | 10,402 | 10,153 | ||||||||||||
Income tax receivable | 4,224 | 4,999 | ||||||||||||||
Marketable debt securities, available-for-sale at June 30, 2020 and December 31, 2019, respectively, and $0 | 169,768 | 150,752 | ||||||||||||||
Marketable debt securities, available-for-sale | 147,172 | 158,258 | ||||||||||||||
Advances and loans, net | 1,830 | 2,882 | 2,657 | 2,413 | ||||||||||||
Other assets | 3,619 | 3,185 | 5,742 | 4,711 | ||||||||||||
Total current assets | 347,668 | 410,167 | 411,341 | 429,078 | ||||||||||||
Property and equipment, net | 23,429 | 22,643 | 22,746 | 23,436 | ||||||||||||
Operating lease right-of-use | 86,035 | 90,535 | 86,420 | 84,024 | ||||||||||||
Marketable debt securities, available-for-sale at June 30, 2020 and December 31, 2019, respectively, and $0 | 42,781 | 60,809 | ||||||||||||||
Marketable debt securities, available-for-sale | 97,514 | 47,773 | ||||||||||||||
Assets held in rabbi trust | 9,081 | 9,452 | 11,178 | 10,295 | ||||||||||||
Deferred tax assets, net | 17,710 | 22,122 | 20,706 | 21,374 | ||||||||||||
Goodwill and other intangible assets, net | 37,829 | 22,312 | 49,843 | 52,053 | ||||||||||||
Advances and loans, net | 101,781 | 66,647 | 114,036 | 106,913 | ||||||||||||
Other assets | 4,501 | 4,347 | 3,986 | 4,176 | ||||||||||||
Total assets | $ | 670,815 | $ | 709,034 | $ | 817,770 | $ | 779,122 | ||||||||
Liabilities and stockholders’ equity | ||||||||||||||||
Current liabilities: | ||||||||||||||||
Accounts payable and other liabilities | $ | 10,914 | $ | 10,790 | $ | 20,959 | $ | 18,288 | ||||||||
Notes payable to former stockholders | — | 6,564 | ||||||||||||||
Deferred compensation and commissions | 25,549 | 44,301 | 48,169 | 58,106 | ||||||||||||
Income tax payable | 2,380 | 3,726 | ||||||||||||||
Operating lease liabilities | 17,880 | 17,762 | 20,157 | 19,190 | ||||||||||||
Accrued bonuses and other employee related expenses | 4,211 | 22,388 | 23,854 | 21,007 | ||||||||||||
Total current liabilities | 58,554 | 101,805 | 115,519 | 120,317 | ||||||||||||
Deferred compensation and commissions | 31,388 | 45,628 | 32,191 | 38,745 | ||||||||||||
Operating lease liabilities | 60,262 | 63,155 | 61,293 | 59,408 | ||||||||||||
Other liabilities | 7,698 | 3,539 | 11,914 | 13,816 | ||||||||||||
Total liabilities | 157,902 | 214,127 | 220,917 | 232,286 | ||||||||||||
Commitments and contingencies | — | — | 0 | 0 | ||||||||||||
Stockholders’ equity: | ||||||||||||||||
Preferred stock, $0.0001 par value: | ||||||||||||||||
Authorized shares – 25,000,000; issued and outstanding shares – 0ne at June 30, 2020 and December 31, 2019, respectively | — | — | ||||||||||||||
Authorized shares – 25,000,000; issued and outstanding shares – NaN at June 30, 2021 and December 31, 2020, respectively | 0 | 0 | ||||||||||||||
Common stock, $0.0001 par value: | ||||||||||||||||
Authorized shares – 150,000,000; issued and outstanding shares – 39,328,017 and 39,153,195 at June 30, 2020 and December 31, 2019, respectively | 4 | 4 | ||||||||||||||
Authorized shares – 150,000,000; issued and outstanding shares – 39,578,360 and 39,401,976 at June 30, 2021 and December 31, 2020, respectively | 4 | 4 | ||||||||||||||
Additional paid-in capital | 108,308 | 104,658 | 117,457 | 113,182 | ||||||||||||
Stock notes receivable from employees | — | (4 | ) | |||||||||||||
Retained earnings | 401,414 | 388,271 | 477,620 | 431,076 | ||||||||||||
Accumulated other comprehensive income | 3,187 | 1,978 | 1,772 | 2,574 | ||||||||||||
Total stockholders’ equity | 512,913 | 494,907 | 596,853 | 546,836 | ||||||||||||
Total liabilities and stockholders’ equity | $ | 670,815 | $ | 709,034 | $ | 817,770 | $ | 779,122 | ||||||||
Three Months Ended June 30, | Six Months Ended June 30, | Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||||||||
2020 | 2019 | 2020 | 2019 | 2021 | 2020 | 2021 | 2020 | |||||||||||||||||||||||||
Revenues: | ||||||||||||||||||||||||||||||||
Real estate brokerage commissions | $ | 103,371 | $ | 188,680 | $ | 275,200 | $ | 333,617 | $ | 252,903 | $ | 103,371 | $ | 415,699 | $ | 275,200 | ||||||||||||||||
Financing fees | 12,703 | 17,742 | 28,054 | 31,474 | 28,214 | 12,703 | 46,057 | 28,054 | ||||||||||||||||||||||||
Other revenues | 1,326 | 3,171 | 4,863 | 5,209 | 3,829 | 1,326 | 7,167 | 4,863 | ||||||||||||||||||||||||
Total revenues | 117,400 | 209,593 | 308,117 | 370,300 | 284,946 | 117,400 | 468,923 | 308,117 | ||||||||||||||||||||||||
Operating expenses: | ||||||||||||||||||||||||||||||||
Cost of services | 73,743 | 127,847 | 187,500 | 219,535 | 178,585 | 73,743 | 287,688 | 187,500 | ||||||||||||||||||||||||
Selling, general and administrative | 43,519 | 52,836 | 98,379 | 101,754 | 61,797 | 43,519 | 113,474 | 98,379 | ||||||||||||||||||||||||
Depreciation and amortization | 2,752 | 1,932 | 5,216 | 3,764 | 2,959 | 2,752 | 5,956 | 5,216 | ||||||||||||||||||||||||
Total operating expenses | 120,014 | 182,615 | 291,095 | 325,053 | 243,341 | 120,014 | 407,118 | 291,095 | ||||||||||||||||||||||||
Operating (loss) income | (2,614 | ) | 26,978 | 17,022 | 45,247 | |||||||||||||||||||||||||||
Operating income (loss) | 41,605 | (2,614 | ) | 61,805 | 17,022 | |||||||||||||||||||||||||||
Other income (expense), net | 2,975 | 3,119 | 2,609 | 6,494 | 1,370 | 2,975 | 2,414 | 2,609 | ||||||||||||||||||||||||
Interest expense | (213 | ) | (340 | ) | (496 | ) | (689 | ) | (146 | ) | (213 | ) | (292 | ) | (496 | ) | ||||||||||||||||
Income before provision for income taxes | 148 | 29,757 | 19,135 | 51,052 | 42,829 | 148 | 63,927 | 19,135 | ||||||||||||||||||||||||
Provision for income taxes | 42 | 8,478 | 5,959 | 14,135 | 11,297 | 42 | 17,383 | 5,959 | ||||||||||||||||||||||||
Net income | 106 | 21,279 | 13,176 | 36,917 | 31,532 | 106 | 46,544 | 13,176 | ||||||||||||||||||||||||
Other comprehensive income (loss): | ||||||||||||||||||||||||||||||||
Marketable debt securities, available-for-sale: | ||||||||||||||||||||||||||||||||
Change in unrealized gains | 1,214 | 856 | 717 | 1,714 | ||||||||||||||||||||||||||||
Less: reclassification adjustment for net losses (gains) included in other income (expense), net | 13 | (9 | ) | 24 | (18 | ) | ||||||||||||||||||||||||||
Change in net unrealized gains | 146 | 1,214 | (475 | ) | 717 | |||||||||||||||||||||||||||
Less: reclassification adjustment for net losses included in other income (expense), net | 3 | 13 | 3 | 24 | ||||||||||||||||||||||||||||
Net change, net of tax of $421, $283, $253 and $571 for the three and six months ended June 30, 2020 and 2019, respectively | 1,227 | 847 | 741 | 1,696 | ||||||||||||||||||||||||||||
Foreign currency translation (loss) gain, net of tax of $0 for each of the three and six months ended June 30, 2020 and 2019 | (423 | ) | (216 | ) | 468 | (314 | ) | |||||||||||||||||||||||||
Net change, net of tax of $51, $421, $(164) and $253 for the three and six months ended June 30, 2021 and 2020, respectively | 149 | 1,227 | (472 | ) | 741 | |||||||||||||||||||||||||||
Foreign currency translation (loss) gain, net of tax of $0 for each of the three and six months ended June 30, 2021 and 2020 | (217 | ) | (423 | ) | (330 | ) | 468 | |||||||||||||||||||||||||
Total other comprehensive income | 804 | 631 | 1,209 | 1,382 | ||||||||||||||||||||||||||||
Total other comprehensive (loss) income | (68 | ) | 804 | (802 | ) | 1,209 | ||||||||||||||||||||||||||
Comprehensive income | $ | 910 | $ | 21,910 | $ | 14,385 | $ | 38,299 | $ | 31,464 | $ | 910 | $ | 45,742 | $ | 14,385 | ||||||||||||||||
Earnings per share: | ||||||||||||||||||||||||||||||||
Basic | $ | — | $ | 0.54 | $ | 0.33 | $ | 0.94 | $ | 0.79 | $ | 0 | $ | 1.17 | $ | 0.33 | ||||||||||||||||
Diluted | $ | — | $ | 0.54 | $ | 0.33 | $ | 0.93 | $ | 0.78 | $ | 0 | $ | 1.16 | $ | 0.33 | ||||||||||||||||
Weighted average common shares outstanding: | ||||||||||||||||||||||||||||||||
Basic | 39,629 | 39,395 | 39,585 | 39,353 | 39,877 | 39,629 | 39,817 | 39,585 | ||||||||||||||||||||||||
Diluted | 39,673 | 39,527 | 39,662 | 39,524 | 40,139 | 39,673 | 40,112 | 39,662 |
Three Months Ended June 30, 2020 | ||||||||||||||||||||||||||||||||||||
Preferred Stock | Common Stock | Additional Paid-In Capital | Stock Notes Receivable From Employees | Retained Earnings | Accumulated Other Comprehensive Income | Total | ||||||||||||||||||||||||||||||
Shares | Amount | Shares | Amount | |||||||||||||||||||||||||||||||||
Balance at March 31, 2020 | — | $ | — | 39,272,429 | $ | 4 | $ | 105,601 | $ | (4 | ) | $ | 401,308 | $ | 2,383 | $ | 509,292 | |||||||||||||||||||
Net and comprehensive income | — | — | — | — | — | — | 106 | 804 | 910 | |||||||||||||||||||||||||||
Stock-based award activity | ||||||||||||||||||||||||||||||||||||
Stock-based compensation | — | — | — | — | 2,536 | — | — | — | 2,536 | |||||||||||||||||||||||||||
Shares issued pursuant to employee stock purchase plan | — | — | 15,923 | — | 371 | — | — | — | 371 | |||||||||||||||||||||||||||
Issuance of common stock for vesting of restricted stock units | — | — | 27,373 | — | — | — | — | — | — | |||||||||||||||||||||||||||
Issuance of common stock for unvested restricted stock awards | — | — | 19,516 | — | — | — | — | — | — | |||||||||||||||||||||||||||
Shares withheld related to net share settlement of stock-based awards | — | — | (7,224 | ) | — | (200 | ) | — | — | — | (200 | ) | ||||||||||||||||||||||||
Reduction of stock notes receivable from employees | — | — | — | — | — | 4 | — | — | 4 | |||||||||||||||||||||||||||
Balance as of June 30, 2020 | — | $ | — | 39,328,017 | $ | 4 | $ | 108,308 | $ | — | $ | 401,414 | $ | 3,187 | $ | 512,913 | ||||||||||||||||||||
Three Months Ended June 30, 2019 | ||||||||||||||||||||||||||||||||||||
Preferred Stock | Common Stock | Additional Paid-In Capital | Stock Notes Receivable From Employees | Retained Earnings | Accumulated Other Comprehensive Income | Total | ||||||||||||||||||||||||||||||
Shares | Amount | Shares | Amount | |||||||||||||||||||||||||||||||||
Balance at March 31, 2019 | — | $ | — | 39,042,434 | $ | 4 | $ | 97,587 | $ | (4 | ) | $ | 326,979 | $ | 1,526 | $ | 426,092 | |||||||||||||||||||
Net and comprehensive income | — | — | — | — | — | — | 21,279 | 631 | 21,910 | |||||||||||||||||||||||||||
Stock-based award activity | ||||||||||||||||||||||||||||||||||||
Stock-based compensation | — | — | — | — | 2,585 | — | — | — | 2,585 | |||||||||||||||||||||||||||
Shares issued pursuant to employee stock purchase plan | — | — | 11,022 | — | 338 | — | — | — | 338 | |||||||||||||||||||||||||||
Issuance of common stock for vesting of restricted stock units | — | — | 40,823 | — | — | — | — | — | — | |||||||||||||||||||||||||||
Issuance of common stock for unvested restricted stock awards | — | — | 10,542 | — | — | — | — | — | — | |||||||||||||||||||||||||||
Shares withheld related to net share settlement of stock-based awards | — | — | (13,960 | ) | — | (412 | ) | — | — | — | (412 | ) | ||||||||||||||||||||||||
Balance as of June 30, 2019 | — | $ | — | 39,090,861 | $ | 4 | $ | 100,098 | $ | (4 | ) | $ | 348,258 | $ | 2,157 | $ | 450,513 | |||||||||||||||||||
Three Months Ended June 30, 2021 | |||||||||||||||||||||||||||||||||||||
Preferred Stock | Common Stock | Additional Paid-In Capital | Stock Notes Receivable From Employees | Retained Earnings | Accumulated Other Comprehensive Income (Loss) | Total | |||||||||||||||||||||||||||||||
Shares | Amount | Shares | Amount | ||||||||||||||||||||||||||||||||||
Balance at March 31, 2021 | 0 | $ | 0 | 39,500,966 | $ | 4 | $ | 113,737 | $ | 0 | $ | 446,088 | $ | 1,840 | $ | 561,669 | |||||||||||||||||||||
Net and comprehensive income (loss) | — | 0 | — | 0 | 0 | 0 | 31,532 | (68 | ) | 31,464 | |||||||||||||||||||||||||||
Stock-based award activity | |||||||||||||||||||||||||||||||||||||
Stock-based compensation | 0 | 0 | 0 | 0 | 2,662 | 0 | 0 | 0 | 2,662 | ||||||||||||||||||||||||||||
Shares issued pursuant to employee stock purchase plan | 0 | 0 | 11,635 | 0 | 369 | 0 | 0 | 0 | 369 | ||||||||||||||||||||||||||||
Issuance of common stock for vesting of restricted stock units | 0 | 0 | 34,198 | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||||||||||||||||
Issuance of common stock for unvested restricted stock awards | 0 | 0 | 12,492 | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||||||||||||||||
Issuance of common stock for stock settled deferred consideration | 0 | 0 | 27,481 | 0 | 1,000 | 0 | 0 | 0 | 1,000 | ||||||||||||||||||||||||||||
Shares withheld related to net share settlement of stock-based awards | 0 | 0 | (8,412 | ) | 0 | (311 | ) | 0 | 0 | 0 | (311 | ) | |||||||||||||||||||||||||
Balance as of June 30, 2021 | 0 | $ | 0 | 39,578,360 | $ | 4 | $ | 117,457 | $ | 0 | $ | 477,620 | $ | 1,772 | $ | 596,853 | |||||||||||||||||||||
Three Months Ended June 30, 2020 | |||||||||||||||||||||||||||||||||||||
Preferred Stock | Common Stock | Additional Paid-In Capital | Stock Notes Receivable From Employees | Retained Earnings | Accumulated Other Comprehensive Income | Total | |||||||||||||||||||||||||||||||
Shares | Amount | Shares | Amount | ||||||||||||||||||||||||||||||||||
Balance at March 31, 2020 | 0 | $ | 0 | 39,272,429 | $ | 4 | $ | 105,601 | $ | (4 | ) | $ | 401,308 | $ | 2,383 | $ | 509,292 | ||||||||||||||||||||
Net and comprehensive income | — | 0 | — | 0 | 0 | 0 | 106 | 804 | 910 | ||||||||||||||||||||||||||||
Stock-based award activity | |||||||||||||||||||||||||||||||||||||
Stock-based compensation | 0 | 0 | 0 | 0 | 2,536 | 0 | 0 | 0 | 2,536 | ||||||||||||||||||||||||||||
Shares issued pursuant to employee stock purchase | 0 | 0 | 15,923 | 0 | 371 | 0 | 0 | 0 | 371 | ||||||||||||||||||||||||||||
Issuance of common stock for vesting of restricted stock units | 0 | 0 | 27,373 | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||||||||||||||||
Issuance of common stock for unvested restricted stock awards | 0 | 0 | 19,516 | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||||||||||||||||
Shares withheld related to net share settlement of stock-based awards | 0 | 0 | (7,224 | ) | 0 | (200 | ) | 0 | 0 | 0 | (200 | ) | |||||||||||||||||||||||||
Reduction of stock notes receivable from employees | — | 0 | — | 0 | 0 | 4 | 0 | 0 | 4 | ||||||||||||||||||||||||||||
Balance as of June 30, 2020 | 0 | $ | 0 | 39,328,017 | $ | 4 | $ | 108,308 | $ | 0 | $ | 401,414 | $ | 3,187 | $ | 512,913 | |||||||||||||||||||||
Six Months Ended June 30, 2020 | ||||||||||||||||||||||||||||||||||||
Preferred Stock | Common Stock | Additional Paid-In Capital | Stock Notes Receivable From Employees | Retained Earnings | Accumulated Other Comprehensive Income | Total | ||||||||||||||||||||||||||||||
Shares | Amount | Shares | Amount | |||||||||||||||||||||||||||||||||
Balance at December 31, 2019 | — | $ | — | 39,153,195 | $ | 4 | $ | 104,658 | $ | (4 | ) | $ | 388,271 | $ | 1,978 | $ | 494,907 | |||||||||||||||||||
Cumulative effect of a change in accounting principle, net of tax | — | — | — | — | — | — | (33 | ) | — | (33 | ) | |||||||||||||||||||||||||
Balance at January 1, 2020, as adjusted | — | — | 39,153,195 | 4 | 104,658 | (4 | ) | 388,238 | 1,978 | 494,874 | ||||||||||||||||||||||||||
Net and comprehensive income | — | — | — | — | — | — | 13,176 | 1,209 | 14,385 | |||||||||||||||||||||||||||
Stock-based award activity | ||||||||||||||||||||||||||||||||||||
Stock-based compensation | — | — | — | — | 5,168 | — | — | — | 5,168 | |||||||||||||||||||||||||||
Shares issued pursuant to employee stock purchase plan | — | — | 15,923 | — | 371 | — | — | — | 371 | |||||||||||||||||||||||||||
Issuance of common stock for vesting of restricted stock units | — | — | 197,479 | — | — | — | — | — | — | |||||||||||||||||||||||||||
Issuance of common stock for unvested restricted stock awards | — | — | 19,516 | — | — | — | — | — | — | |||||||||||||||||||||||||||
Shares withheld related to net share settlement of stock-based awards | — | — | (58,096 | ) | — | (1,889 | ) | — | — | — | (1,889 | ) | ||||||||||||||||||||||||
Reduction of stock notes receivable from employees | — | — | — | — | — | 4 | — | — | 4 | |||||||||||||||||||||||||||
Balance as of June 30, 2020 | — | $ | — | 39,328,017 | $ | 4 | $ | 108,308 | $ | — | $ | 401,414 | $ | 3,187 | $ | 512,913 | ||||||||||||||||||||
Six Months Ended June 30, 2021 | ||||||||||||||||||||||||||||||||||||
Preferred Stock | Common Stock | Additional Paid-In Capital | Stock Notes Receivable From Employees | Retained Earnings | Accumulated Other Comprehensive Income (Loss) | Total | ||||||||||||||||||||||||||||||
Shares | Amount | Shares | Amount | |||||||||||||||||||||||||||||||||
Balance at December 31, 2020 | 0 | $ | 0 | 39,401,976 | $ | 4 | $ | 113,182 | $ | 0 | $ | 431,076 | $ | 2,574 | $ | 546,836 | ||||||||||||||||||||
Net and comprehensive income (loss) | — | 0 | — | 0 | 0 | 0 | 46,544 | (802 | ) | 45,742 | ||||||||||||||||||||||||||
Stock-based award activity | ||||||||||||||||||||||||||||||||||||
Stock-based compensation | 0 | 0 | 0 | 0 | 4,950 | 0 | 0 | 0 | 4,950 | |||||||||||||||||||||||||||
Shares issued pursuant to employee stock purchase plan | 0 | 0 | 11,635 | 0 | 369 | 0 | 0 | 0 | 369 | |||||||||||||||||||||||||||
Issuance of common stock for vesting of restricted stock units | 0 | 0 | 183,315 | 0 | 0 | 0 | 0 | 0 | 0 | |||||||||||||||||||||||||||
Issuance of common stock for unvested restricted stock awards | 0 | 0 | 12,492 | 0 | 0 | 0 | 0 | 0 | 0 | |||||||||||||||||||||||||||
Issuance of common stock for stock settled deferred consideration | 0 | 0 | 27,481 | 0 | 1,000 | 0 | 0 | 0 | 1,000 | |||||||||||||||||||||||||||
Shares withheld related to net share settlement of stock-based awards | 0 | 0 | (58,539 | ) | 0 | (2,044 | ) | 0 | 0 | 0 | (2,044 | ) | ||||||||||||||||||||||||
Balance as of June 30, 2021 | 0 | $ | 0 | 39,578,360 | $ | 4 | $ | 117,457 | $ | 0 | $ | 477,620 | $ | 1,772 | $ | 596,853 | ||||||||||||||||||||
Six Months Ended June 30, 2019 | Six Months Ended June 30, 2020 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Preferred Stock | Common Stock | Additional Paid-In Capital | Stock Notes Receivable From Employees | Retained Earnings | Accumulated Other Comprehensive Income | Total | Preferred Stock | Common Stock | Additional Paid-In Capital | Stock Notes Receivable From Employees | Retained Earnings | Accumulated Other Comprehensive Income | Total | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Shares | Amount | Shares | Amount | Shares | Amount | Shares | Amount | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Balance at December 31, 2018 | — | $ | — | 38,814,464 | $ | 4 | $ | 97,458 | $ | (4 | ) | $ | 311,341 | $ | 775 | $ | 409,574 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Balance at December 31, 2019 | 0 | $ | 0 | 39,153,195 | $ | 4 | $ | 104,658 | $ | (4 | ) | $ | 388,271 | $ | 1,978 | $ | 494,907 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Cumulative effect of a change in accounting principle, net of tax | 0 | 0 | 0 | 0 | 0 | 0 | (33 | ) | 0 | (33 | ) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Balance at January 1, 2020, as adjusted | 0 | 0 | 39,153,195 | 4 | 104,658 | (4 | ) | 388,238 | 1,978 | 494,874 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net and comprehensive income | — | — | — | — | — | — | 36,917 | 1,382 | 38,299 | — | 0 | — | 0 | 0 | 0 | 13,176 | 1,209 | 14,385 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock-based award activity | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation | — | — | — | — | 4,926 | — | — | — | 4,926 | 0 | 0 | 0 | 0 | 5,168 | 0 | 0 | 0 | 5,168 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Shares issued pursuant to employee stock purchase plan | — | — | 11,022 | — | 338 | — | — | — | 338 | 0 | 0 | 15,923 | 0 | 371 | 0 | 0 | 0 | 371 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Issuance of common stock for vesting of restricted stock units | — | — | 325,219 | — | — | — | — | — | — | 0 | 0 | 197,479 | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Issuance of common stock for unvested restricted stock awards | — | — | 10,542 | — | — | — | — | — | — | 0 | 0 | 19,516 | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
Shares withheld related to net share settlement of stock-based awards | — | — | (70,386 | ) | — | (2,624 | ) | — | — | — | (2,624 | ) | 0 | 0 | (58,096 | ) | 0 | (1,889 | ) | 0 | 0 | 0 | (1,889 | ) | ||||||||||||||||||||||||||||||||||||||||||||||||
Reduction of stock notes receivable from | — | 0 | — | 0 | 0 | 4 | 0 | 0 | 4 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Balance as of June 30, 2019 | — | $ | — | 39,090,861 | $ | 4 | $ | 100,098 | $ | (4 | ) | $ | 348,258 | $ | 2,157 | $ | 450,513 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Balance as of June 30, 2020 | 0 | $ | 0 | 39,328,017 | $ | 4 | $ | 108,308 | $ | 0 | $ | 401,414 | $ | 3,187 | $ | 512,913 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Six Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2020 | 2019 | 2021 | 2020 | |||||||||||||
Cash flows from operating activities | ||||||||||||||||
Net income | $ | 13,176 | $ | 36,917 | $ | 46,544 | $ | 13,176 | ||||||||
Adjustments to reconcile net income to net cash used in operating activities: | ||||||||||||||||
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | ||||||||||||||||
Depreciation and amortization | 5,216 | 3,764 | 5,956 | 5,216 | ||||||||||||
Amortization of right-of-use | 11,151 | 10,242 | 11,850 | 11,151 | ||||||||||||
Credit loss recovery | (78 | ) | (13 | ) | (137 | ) | (78 | ) | ||||||||
Stock-based compensation | 5,168 | 4,926 | 4,950 | 5,168 | ||||||||||||
Deferred taxes, net | 4,172 | 3,863 | 780 | 4,172 | ||||||||||||
Unrealized foreign exchange loss | 557 | — | ||||||||||||||
Net realized (gains) losses on marketable debt securities, available-for-sale | (117 | ) | (12 | ) | ||||||||||||
Unrealized foreign exchange (gains) losses | (560 | ) | 557 | |||||||||||||
Net realized gains on marketable debt securities, available-for-sale | (10 | ) | (117 | ) | ||||||||||||
Other non-cash items | 567 | (228 | ) | 196 | 567 | |||||||||||
Changes in operating assets and liabilities: | ||||||||||||||||
Commissions receivable | (5 | ) | (820 | ) | (4,781 | ) | (5 | ) | ||||||||
Prepaid expenses | 2,259 | (1,689 | ) | (239 | ) | 2,259 | ||||||||||
Advances and loans | (34,149 | ) | (17,614 | ) | (7,086 | ) | (34,149 | ) | ||||||||
Other assets | (1,059 | ) | (3,753 | ) | (2,138 | ) | (1,059 | ) | ||||||||
Accounts payable and other liabilities | (1,204 | ) | 14 | 4,988 | (1,204 | ) | ||||||||||
Income tax receivable/payable | 775 | (9,248 | ) | (1,345 | ) | 775 | ||||||||||
Accrued bonuses and other employee related expenses | (18,168 | ) | (14,228 | ) | 3,005 | (18,168 | ) | |||||||||
Deferred compensation and commissions | (31,425 | ) | (28,291 | ) | (15,968 | ) | (31,425 | ) | ||||||||
Operating lease liabilities | (9,016 | ) | (8,169 | ) | (10,557 | ) | (9,016 | ) | ||||||||
Other liabilities | 331 | (24 | ) | (1,982 | ) | 331 | ||||||||||
Net cash used in operating activities | (51,849 | ) | (24,363 | ) | ||||||||||||
Net cash provided by (used in) operating activities | 33,466 | (51,849 | ) | |||||||||||||
Cash flows from investing activities | ||||||||||||||||
Acquisition of businesses, net of cash received | (11,821 | ) | — | 229 | (11,821 | ) | ||||||||||
Purchases of marketable debt securities, available-for-sale | (95,266 | ) | (79,357 | ) | (199,513 | ) | (95,266 | ) | ||||||||
Proceeds from sales and maturities of marketable debt securities, available-for-sale | 95,028 | 103,108 | 159,968 | 95,028 | ||||||||||||
Issuances of employee notes receivable | (211 | ) | — | (40 | ) | (211 | ) | |||||||||
Payments received on employee notes receivable | 1 | 1 | 276 | 1 | ||||||||||||
Purchase of property and equipment | (4,190 | ) | (4,126 | ) | (2,770 | ) | (4,190 | ) | ||||||||
Net cash (used in) provided by investing activities | (16,459 | ) | 19,626 | |||||||||||||
Net cash used in investing activities | (41,850 | ) | (16,459 | ) | ||||||||||||
Cash flows from financing activities | ||||||||||||||||
Taxes paid related to net share settlement of stock-based awards | (1,889 | ) | (2,624 | ) | (2,044 | ) | (1,889 | ) | ||||||||
Proceeds from issuance of shares pursuant to employee stock purchase plan | 371 | 338 | 369 | 371 | ||||||||||||
Principal payments on notes payable to former stockholders | (6,563 | ) | (1,087 | ) | 0 | (6,563 | ) | |||||||||
Principal payments on stock appreciation rights liability | (1,251 | ) | 185 | (1,481 | ) | (1,251 | ) | |||||||||
Principal payments on deferred consideration | (1,302 | ) | 0 | |||||||||||||
Net cash used in financing activities | (9,332 | ) | (3,188 | ) | (4,458 | ) | (9,332 | ) | ||||||||
Effect of currency exchange rate changes on cash and cash equivalents | (150 | ) | — | 104 | (150 | ) | ||||||||||
Net decrease in cash and cash equivalents | (77,790 | ) | (7,925 | ) | (12,738 | ) | (77,790 | ) | ||||||||
Cash and cash equivalents at beginning of period | 232,670 | 214,683 | 243,152 | 232,670 | ||||||||||||
Cash and cash equivalents at end of period | $ | 154,880 | $ | 206,758 | $ | 230,414 | $ | 154,880 | ||||||||
Supplemental disclosures of cash flow information | ||||||||||||||||
Interest paid during the period | $ | 1,193 | $ | 1,967 | $ | 714 | $ | 1,193 | ||||||||
Income taxes paid, net | $ | 1,013 | $ | 19,520 | $ | 17,897 | $ | 1,013 | ||||||||
1. | Description of Business, |
2. | Property and Equipment, Net |
June 30, 2020 | December 31, 2019 | |||||||
Computer software and hardware equipment | $ | 28,445 | $ | 25,252 | ||||
Furniture, fixtures, and equipment | 23,114 | 23,468 | ||||||
Less: accumulated depreciation and amortization | (28,130 | ) | (26,077 | ) | ||||
$ | 23,429 | $ | 22,643 | |||||
June 30, 2021 | December 31, 2020 | |||||||
Computer software and hardware equipment | $ | 31,007 | $ | 30,955 | ||||
Furniture, fixtures and equipment | 23,809 | 23,418 | ||||||
Less: accumulated depreciation and amortization | (32,070 | ) | (30,937 | ) | ||||
$ | 22,746 | $ | 23,436 | |||||
3. | Operating Leases |
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2020 | 2019 | 2020 | 2019 | |||||||||||||
Operating lease cost: | ||||||||||||||||
Lease cost (1) | $ | 6,341 | $ | 6,106 | $ | 12,604 | $ | 12,015 | ||||||||
Variable lease cost (2) | 1,215 | 1,284 | 2,611 | 2,490 | ||||||||||||
Sublease income | (89 | ) | (43 | ) | (166 | ) | (131 | ) | ||||||||
$ | 7,467 | $ | 7,347 | $ | 15,049 | $ | 14,374 | |||||||||
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||
Operating lease cost: | ||||||||||||||||
Lease cost (1) | $ | 6,512 | $ | 6,341 | $ | 13,101 | $ | 12,604 | ||||||||
Variable lease cost (2) | 1,241 | 1,215 | 2,641 | 2,611 | ||||||||||||
Sublease income | (19 | ) | (89 | ) | (52 | ) | (166 | ) | ||||||||
$ | 7,734 | $ | 7,467 | $ | 15,690 | $ | 15,049 | |||||||||
(1) | Includes short-term lease cost and ROU asset amortization. |
(2) | Primarily relates to common area maintenance, property taxes, insurance, utilities and parking. |
June 30, 2020 | ||||
Remainder of 2020 | $ | 10,505 | ||
2021 | 20,891 | |||
2022 | 15,681 | |||
2023 | 12,286 | |||
2024 | 10,081 | |||
Thereafter | 15,368 | |||
Total future minimum lease payments | 84,812 | |||
Less imputed interest | (6,670 | ) | ||
Present value of operating lease liabilities | $ | 78,142 | ||
June 30, 2021 | ||||
Remainder of 2021 | $ | 11,862 | ||
2022 | 19,536 | |||
2023 | 16,039 | |||
2024 | 13,913 | |||
2025 | 11,730 | |||
Thereafter | 14,575 | |||
Total future minimum lease payments | 87,655 | |||
Less imputed interest | (6,205 | ) | ||
Present value of operating lease liabilities | $ | 81,450 | ||
Six Months Ended June 30, | ||||||||
2020 | 2019 | |||||||
Operating cash flow information: | ||||||||
Cash paid for amounts included in the measurement of operating lease liabilities | $ | 10,456 | $ | 9,973 | ||||
Noncash activity: | ||||||||
ROU assets obtained in exchange for operating lease liabilities | $ | 6,334 | $ | 16,264 | ||||
Tenant improvements owned by lessor related to ROU assets (1) | $ | 317 | $ | 2,532 |
Six Months Ended June 30, | ||||||||
2021 | 2020 | |||||||
Operating cash flow information: | ||||||||
Cash paid for amounts included in the measurement of operating lease liabilities | $ | 11,764 | $ | 10,456 | ||||
Noncash activity: | ||||||||
ROU assets obtained in exchange for operating lease liabilities | $ | 13,373 | $ | 6,334 | ||||
Tenant improvements owned by lessor related to ROU assets (1) | $ | 881 | $ | 317 |
(1) | Reclassification from other assets current. |
June 30, 2020 | December 31, 2019 | |||
Weighted average remaining operating lease term | 4.87 years | 5.04 years | ||
Weighted average discount rate | 3.3% | 3.8% |
June 30, 2021 | December 31, 2020 | |||||||
Weighted average remaining operating lease term | 4.84 years | 4.70 years | ||||||
Weighted average discount rate | 3.0 | % | 3.1 | % |
4. | Investments in Marketable Debt Securities |
June 30, 2020 | ||||||||||||||||||||
Amortized Cost | Allowance for Credit Losses | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | ||||||||||||||||
Short-term investments: | ||||||||||||||||||||
U.S. treasuries | $ | 108,982 | $ | — | $ | 498 | $ | (1 | ) | $ | 109,479 | |||||||||
U.S. government sponsored entities | 37,699 | — | 14 | — | 37,713 | |||||||||||||||
Corporate debt | 22,514 | — | 62 | — | 22,576 | |||||||||||||||
$ | 169,195 | $ | — | $ | 574 | $ | (1 | ) | $ | 169,768 | ||||||||||
Long-term investments: | ||||||||||||||||||||
U.S. treasuries | $ | 3,892 | $ | — | $ | 319 | $ | — | $ | 4,211 | ||||||||||
U.S. government sponsored entities | 1,218 | — | 36 | — | 1,254 | |||||||||||||||
Corporate debt | 28,139 | — | 1,758 | (181 | ) | 29,716 | ||||||||||||||
ABS and other | 7,559 | — | 128 | (87 | ) | 7,600 | ||||||||||||||
$ | 40,808 | $ | — | $ | 2,241 | $ | (268 | ) | $ | 42,781 | ||||||||||
June 30, 2021 | ||||||||||||||||||||
Amortized Cost | Allowance for Credit Losses | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | ||||||||||||||||
Short-term investments: | ||||||||||||||||||||
U.S. treasuries | $ | 74,424 | $ | 0 | $ | 12 | $ | 0 | $ | 74,436 | ||||||||||
Corporate debt | 72,718 | 0 | 19 | (1 | ) | 72,736 | ||||||||||||||
$ | 147,142 | $ | 0 | $ | 31 | $ | (1 | ) | $ | 147,172 | ||||||||||
Long-term investments: | ||||||||||||||||||||
U.S. treasuries | $ | 52,033 | $ | 0 | $ | 185 | $ | (22 | ) | $ | 52,196 | |||||||||
U.S. government sponsored entities | 888 | 0 | 27 | (2 | ) | 913 | ||||||||||||||
Corporate debt | 35,998 | 0 | 1,669 | (18 | ) | 37,649 | ||||||||||||||
Asset-backed securities (“ABS”) and other | 6,569 | 0 | 189 | (2 | ) | 6,756 | ||||||||||||||
$ | 95,488 | $ | 0 | $ | 2,070 | $ | (44 | ) | $ | 97,514 | ||||||||||
December 31, 2019 | ||||||||||||||||
Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | |||||||||||||
Short-term investments: | ||||||||||||||||
U.S. treasuries | $ | 124,389 | $ | 196 | $ | (5 | ) | $ | 124,580 | |||||||
U.S. government sponsored entities | — | — | — | — | ||||||||||||
Corporate debt | 26,128 | 44 | — | 26,172 | ||||||||||||
$ | 150,517 | $ | 240 | $ | (5 | ) | $ | 150,752 | ||||||||
Long-term investments: | ||||||||||||||||
U.S. treasuries | $ | 24,188 | $ | 235 | $ | — | $ | 24,423 | ||||||||
U.S. government sponsored entities | 1,353 | 3 | (1 | ) | 1,355 | |||||||||||
Corporate debt | 25,447 | 1,027 | (3 | ) | 26,471 | |||||||||||
ABS and other | 8,480 | 93 | (13 | ) | 8,560 | |||||||||||
$ | 59,468 | $ | 1,358 | $ | (17 | ) | $ | 60,809 | ||||||||
December 31, 2020 | ||||||||||||||||||||
Amortized Cost | Allowance for Credit Losses | Gross Unrealized Gains | Gross Unrealized Losses | Fair Value | ||||||||||||||||
Short-term investments: | ||||||||||||||||||||
U.S. treasuries | $ | 75,887 | $ | 0 | $ | 88 | $ | (5 | ) | $ | 75,970 | |||||||||
U.S. government sponsored entities | 32,439 | 0 | 8 | 0 | 32,447 | |||||||||||||||
Corporate debt | 49,822 | 0 | 20 | (1 | ) | 49,841 | ||||||||||||||
$ | 158,148 | $ | 0 | $ | 116 | $ | (6 | ) | $ | 158,258 | ||||||||||
Long-term investments: | ||||||||||||||||||||
U.S. treasuries | $ | 3,375 | $ | 0 | $ | 266 | $ | 0 | $ | 3,641 | ||||||||||
U.S. government sponsored entities | 1,114 | 0 | 38 | 0 | 1,152 | |||||||||||||||
Corporate debt | 34,183 | 0 | 2,137 | (33 | ) | 36,287 | ||||||||||||||
ABS and other | 6,509 | 0 | 195 | (11 | ) | 6,693 | ||||||||||||||
$ | 45,181 | $ | 0 | $ | 2,636 | $ | (44 | ) | $ | 47,773 | ||||||||||
June 30, 2020 | ||||||||||||||||||||||||
Less than 12 months | 12 months or greater | Total | ||||||||||||||||||||||
Fair Value | Gross Unrealized Losses | Fair Value | Gross Unrealized Losses | Fair Value | Gross Unrealized Losses | |||||||||||||||||||
U.S. treasuries | $ | 16,889 | $ | (1 | ) | $ | — | $ | — | $ | 16,889 | $ | (1 | ) | ||||||||||
Corporate debt | 2,073 | (181 | ) | — | — | 2,073 | (181 | ) | ||||||||||||||||
ABS and other | 2,256 | (87 | ) | — | — | 2,256 | (87 | ) | ||||||||||||||||
$ | 21,218 | $ | (269 | ) | $ | — | $ | — | $ | 21,218 | $ | (269 | ) | |||||||||||
June 30, 2021 | ||||||||||||||||||||||||
Less than 12 months | 12 months or greater | Total | ||||||||||||||||||||||
Fair Value | Gross Unrealized Losses | Fair Value | Gross Unrealized Losses | Fair Value | Gross Unrealized Losses | |||||||||||||||||||
U.S. treasuries | $ | 36,576 | $ | (22 | ) | $ | 0 | $ | 0 | $ | 36,576 | $ | (22 | ) | ||||||||||
U.S. government sponsored entities | 134 | (2 | ) | 0 | 0 | 134 | (2 | ) | ||||||||||||||||
Corporate debt | 25,190 | (16 | ) | 145 | (3 | ) | 25,335 | (19 | ) | |||||||||||||||
ABS and other | 250 | 0 | 223 | (2 | ) | 473 | (2 | ) | ||||||||||||||||
$ | 62,150 | $ | (40 | ) | $ | 368 | $ | (5 | ) | $ | 62,518 | $ | (45 | ) | ||||||||||
December 31, 2019 | ||||||||||||||||||||||||
Less than 12 months | 12 months or greater | Total | ||||||||||||||||||||||
Fair Value | Gross Unrealized Losses | Fair Value | Gross Unrealized Losses | Fair Value | Gross Unrealized Losses | |||||||||||||||||||
U.S. treasuries | $ | 39,823 | $ | (5 | ) | $ | — | $ | — | $ | 39,823 | $ | (5 | ) | ||||||||||
U.S. government sponsored entities | — | — | 566 | (1 | ) | 566 | (1 | ) | ||||||||||||||||
Corporate debt | 6,029 | (3 | ) | — | — | 6,029 | (3 | ) | ||||||||||||||||
ABS and other | 1,971 | (13 | ) | — | — | 1,971 | (13 | ) | ||||||||||||||||
$ | 47,823 | $ | (21 | ) | $ | 566 | $ | (1 | ) | $ | 48,389 | $ | (22 | ) | ||||||||||
December 31, 2020 | ||||||||||||||||||||||||
Less than 12 months | 12 months or greater | Total | ||||||||||||||||||||||
Fair Value | Gross Unrealized Losses | Fair Value | Gross Unrealized Losses | Fair Value | Gross Unrealized Losses | |||||||||||||||||||
U.S. treasuries | $ | 41,702 | $ | (5 | ) | $ | 0 | $ | 0 | $ | 41,702 | $ | (5 | ) | ||||||||||
Corporate debt | 29,810 | (34 | ) | 0 | 0 | 29,810 | (34 | ) | ||||||||||||||||
ABS and other | 546 | (6 | ) | 157 | (5 | ) | 703 | (11 | ) | |||||||||||||||
$ | 72,058 | $ | (45 | ) | $ | 157 | $ | (5 | ) | $ | 72,215 | $ | (50 | ) | ||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2020 | 2019 | 2020 | 2019 | |||||||||||||
Gross realized gains (1) | $ | 79 | $ | 24 | $ | 132 | $ | 59 | ||||||||
Gross realized losses (1) | $ | (15 | ) | $ | — | $ | (15 | ) | $ | (47 | ) | |||||
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||
Gross realized gains (1) | $ | 9 | $ | 79 | $ | 10 | $ | 132 | ||||||||
Gross realized losses (1) | $ | 0 | $ | (15 | ) | $ | 0 | $ | (15 | ) | ||||||
(1) | Recorded in other income (expense), net in the condensed consolidated statements of net and comprehensive income. The cost basis of securities sold were determined based on the specific identification method. |
June 30, 2020 | December 31, 2019 | |||||||||||||||
Amortized Cost | Fair Value | Amortized Cost | Fair Value | |||||||||||||
Due in one year or less | $ | 169,195 | $ | 169,768 | $ | 150,517 | $ | 150,752 | ||||||||
Due after one year through five years | 25,166 | 26,426 | 41,123 | 41,794 | ||||||||||||
Due after five years through ten years | 10,709 | 11,395 | 12,813 | 13,467 | ||||||||||||
Due after ten years | 4,933 | 4,960 | 5,532 | 5,548 | ||||||||||||
$ | 210,003 | $ | 212,549 | $ | 209,985 | $ | 211,561 | |||||||||
Weighted average contractual maturity | 1.7 | 1.7 years |
June 30, 2021 | December 31, 2020 | |||||||||||||||
Amortized Cost | Fair Value | Amortized Cost | Fair Value | |||||||||||||
Due in one year or less | $ | 147,142 | $ | 147,172 | $ | 158,148 | $ | 158,258 | ||||||||
Due after one year through five years | 80,697 | 81,796 | 30,604 | 32,041 | ||||||||||||
Due after five years through ten years | 10,045 | 10,824 | 10,022 | 11,044 | ||||||||||||
Due after ten years | 4,746 | 4,894 | 4,555 | 4,688 | ||||||||||||
$ | 242,630 | $ | 244,686 | $ | 203,329 | $ | 206,031 | |||||||||
Weighted average contractual maturity | 1.8 years | 1.6 years |
5. | Acquisitions, Goodwill and Other Intangible Assets |
June 30, 2020 | December 31, 2019 | |||||||||||||||||||||||
Gross Carrying Amount | Accumulated Amortization | Net Book Value | Gross Carrying Amount | Accumulated Amortization | Net Book Value | |||||||||||||||||||
Goodwill and intangible assets: | ||||||||||||||||||||||||
Goodwill | $ | 24,319 | $ | — | $ | 24,319 | $ | 15,072 | $ | — | $ | 15,072 | ||||||||||||
Intangible assets (1) | 17,291 | (3,781 | ) | 13,510 | 9,050 | (1,810 | ) | 7,240 | ||||||||||||||||
$ | 41,610 | $ | (3,781 | ) | $ | 37,829 | $ | 24,122 | $ | (1,810 | ) | $ | 22,312 | |||||||||||
June 30, 2021 | December 31, 2020 | |||||||||||||||||||||||
Gross Carrying Amount | Accumulated Amortization | Net Book Value | Gross Carrying Amount | Accumulated Amortization | Net Book Value | |||||||||||||||||||
Goodwill and intangible assets: | ||||||||||||||||||||||||
Goodwill | $ | 34,071 | $ | — | $ | 34,071 | $ | 33,375 | $ | — | $ | 33,375 | ||||||||||||
Intangible assets (1) | 23,974 | (8,202 | ) | 15,772 | 24,745 | (6,067 | ) | 18,678 | ||||||||||||||||
$ | 58,045 | $ | (8,202 | ) | $ | 49,843 | $ | 58,120 | $ | (6,067 | ) | $ | 52,053 | |||||||||||
(1) | Total weighted average amortization period was |
Six Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2020 | 2019 | 2021 | 2020 | |||||||||||||
Beginning balance | $ | 15,072 | $ | 11,459 | $ | 33,375 | $ | 15,072 | ||||||||
Additions from acquisitions | 9,247 | — | 696 | 9,247 | ||||||||||||
Impairment losses | — | — | 0 | 0 | ||||||||||||
Ending balance | $ | 24,319 | $ | 11,459 | $ | 34,071 | $ | 24,319 | ||||||||
(1) | The 2021 addition represents a measurement period adjustment. |
June 30, 2020 | ||||
Remainder of 2020 | $ | 1,924 | ||
2021 | 2,972 | |||
2022 | 2,585 | |||
2023 | 2,582 | |||
2024 | 2,013 | |||
Thereafter | 1,434 | |||
$ | 13,510 | |||
June 30, 2021 | ||||
Remainder of 2021 | $ | 1,738 | ||
2022 | 3,474 | |||
2023 | 3,407 | |||
2024 | 2,891 | |||
2025 | 2,671 | |||
Thereafter | 1,591 | |||
$ | 15,772 | |||
6. | Selected Balance Sheet Data |
Advances and Loans | Commissions Receivable | Total | ||||||||||
Beginning balance as of January 1, 2020 | $ | 512 | $ | 32 | $ | 544 | ||||||
Credit loss (recovery) expense | (79 | ) | 1 | (78 | ) | |||||||
Write-offs | (32 | ) | — | (32 | ) | |||||||
Ending balance as of June 30, 2020 | $ | 401 | $ | 33 | $ | 434 | ||||||
Advances and Loans | Commissions Receivable | Total | ||||||||||
Beginning balance as of January 1, 2021 | $ | 563 | $ | 94 | $ | 657 | ||||||
Credit recovery | (53 | ) | (84 | ) | (137 | ) | ||||||
Write-offs | (36 | ) | 0 | (36 | ) | |||||||
Ending balance as of June 30, 2021 | $ | 474 | $ | 10 | $ | 484 | ||||||
Advances and Loans | Commissions Receivable | Total | ||||||||||
Beginning balance as of January 1, 2019 | $ | 514 | $ | — | $ | 514 | ||||||
Credit loss recovery | (13 | ) | — | (13 | ) | |||||||
Write-offs | (103 | ) | — | (103 | ) | |||||||
Ending balance as of June 30, 2019 | $ | 398 | $ | — | $ | 398 | ||||||
Advances and Loans | Commissions Receivable | Total | ||||||||||
Beginning balance as of January 1, 2020 | $ | 512 | $ | 32 | (1) | $ | 544 | |||||
Credit loss (recovery) expense | (79 | ) | 1 | (78 | ) | |||||||
Write-offs | (32 | ) | 0 | (32 | ) | |||||||
Ending balance as of June 30, 2020 | $ | 401 | $ | 33 | $ | 434 | ||||||
(1) | Includes cumulative-effect adjustment related to the adoption of ASU No. 2016-13, Financial Instruments - Credit Losses |
Current | Non-Current | |||||||||||||||
June 30, 2020 | December 31, 2019 | June 30, 2020 | December 31, 2019 | |||||||||||||
Mortgage servicing rights (“MSRs”), net of amortization | $ | — | $ | — | $ | 2,133 | $ | 2,002 | ||||||||
Security deposits | — | — | 1,388 | 1,345 | ||||||||||||
Employee notes receivable (1) | 170 | 65 | 406 | 323 | ||||||||||||
Customer trust accounts and other | 3,449 | 3,120 | 574 | 677 | ||||||||||||
$ | 3,619 | $ | 3,185 | $ | 4,501 | $ | 4,347 | |||||||||
Current | Non-Current | |||||||||||||||
June 30, 2021 | December 31, 2020 | June 30, 2021 | December 31, 2020 | |||||||||||||
Mortgage servicing rights (“MSRs”), net of amortization | $ | 0 | $ | 0 | $ | 1,993 | $ | 1,897 | ||||||||
Security deposits | 0 | 0 | 1,475 | 1,461 | ||||||||||||
Employee notes receivable (1) | 113 | 185 | 12 | 246 | ||||||||||||
Customer trust accounts and other | 5,629 | 4,526 | 506 | 572 | ||||||||||||
$ | 5,742 | $ | 4,711 | $ | 3,986 | $ | 4,176 | |||||||||
(1) | Reduction of accrued bonuses and other employee related expenses in settlement of employee notes receivable were |
Six Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2020 | 2019 | 2021 | 2020 | |||||||||||||
Beginning balance | $ | 2,002 | $ | 2,209 | $ | 1,897 | $ | 2,002 | ||||||||
Additions | 384 | 165 | 366 | 384 | ||||||||||||
Amortization | (253 | ) | (275 | ) | (270 | ) | (253 | ) | ||||||||
Ending balance | $ | 2,133 | $ | 2,099 | $ | 1,993 | $ | 2,133 | ||||||||
Current | Non-Current | Current | Non-Current | |||||||||||||||||||||||||||||
June 30, 2020 | December 31, 2019 | June 30, 2020 | December 31, 2019 | June 30, 2021 | December 31, 2020 | June 30, 2021 | December 31, 2020 | |||||||||||||||||||||||||
Stock appreciation rights (“SARs”) liability (1) | $ | 2,162 | $ | 2,080 | $ | 16,316 | $ | 18,122 | $ | 2,225 | $ | 2,162 | $ | 14,690 | $ | 16,671 | ||||||||||||||||
Commissions payable to investment sales and financing professionals | 21,693 | 40,235 | 8,641 | 20,818 | 44,379 | 54,082 | 10,405 | 15,306 | ||||||||||||||||||||||||
Deferred compensation liability (1) | 1,433 | 1,553 | 6,431 | 6,688 | 1,250 | 1,519 | 7,096 | 6,768 | ||||||||||||||||||||||||
Other | 261 | 433 | — | — | 315 | 343 | 0 | 0 | ||||||||||||||||||||||||
$ | 25,549 | $ | 44,301 | $ | 31,388 | $ | 45,628 | $ | 48,169 | $ | 58,106 | $ | 32,191 | $ | 38,745 | |||||||||||||||||
(1) | The SARs and deferred compensation liability become subject to payout as a result of a participant no longer being considered |
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2020 | 2019 | 2020 | 2019 | |||||||||||||
Increase (decrease) in the carrying value of the assets held in the rabbi trust (1) | $ | 1,124 | $ | 225 | $ | (264 | ) | $ | 928 | |||||||
Increase (decrease) in the net carrying value of the deferred compensation obligation (2) | $ | 973 | $ | 227 | $ | (300 | ) | $ | 912 | |||||||
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||
Increase (decrease) in the carrying value of the assets held in the rabbi trust (1) | $ | 657 | $ | 1,124 | $ | 990 | $ | (264 | ) | |||||||
Increase (decrease) in the net carrying value of the deferred compensation obligation (2) | $ | 503 | $ | 973 | $ | 763 | $ | (300 | ) | |||||||
(1) | Recorded in other income (expense), net in the condensed consolidated statements of net and comprehensive income. |
(2) | Recorded in selling, general and administrative expense in the condensed consolidated statements of net and comprehensive income. |
Non-Current | ||||||||
June 30, 2020 | December 31, 2019 | |||||||
Deferred consideration (1) (2) | $ | 3,372 | $ | 830 | ||||
Contingent consideration (1) (2) | 3,805 | 2,709 | ||||||
Other | 521 | — | ||||||
$ | 7,698 | $ | 3,539 | |||||
Non-Current | ||||||||
June 30, 2021 | December 31, 2020 | |||||||
Deferred consideration (1) (2) | $ | 5,797 | $ | 8,582 | ||||
Contingent consideration (1) (2) | 5,026 | 4,219 | ||||||
Other | 1,091 | 1,015 | ||||||
$ | 11,914 | $ | 13,816 | |||||
(1) | The current portions of deferred consideration in the amounts of |
(2) | Includes a measurement period adjustment and a reduction in deferred consideration settled in |
7. | Related-Party Transactions |
8. | Fair Value Measurements |
Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities; |
June 30, 2020 | December 31, 2019 | |||||||||||||||||||||||||||||||
Fair Value | Level 1 | Level 2 | Level 3 | Fair Value | Level 1 | Level 2 | Level 3 | |||||||||||||||||||||||||
Assets: | ||||||||||||||||||||||||||||||||
Assets held in rabbi trust | $ | 9,081 | $ | — | $ | 9,081 | $ | — | $ | 9,452 | $ | — | $ | 9,452 | $ | — | ||||||||||||||||
Cash equivalents (1) : | ||||||||||||||||||||||||||||||||
Commercial paper and other | $ | 5,751 | $ | — | $ | 5,751 | $ | — | $ | 5,087 | $ | — | $ | 5,087 | $ | — | ||||||||||||||||
Money market funds | 114,909 | 114,909 | — | — | 185,513 | 185,513 | — | — | ||||||||||||||||||||||||
$ | 120,660 | $ | 114,909 | $ | 5,751 | $ | — | $ | 190,600 | $ | 185,513 | $ | 5,087 | $ | — | |||||||||||||||||
Marketable debt securities, available-for-sale: | ||||||||||||||||||||||||||||||||
Short-term investments: | ||||||||||||||||||||||||||||||||
U.S. treasuries | $ | 109,479 | $ | 109,479 | $ | — | $ | — | $ | 124,580 | $ | 124,580 | $ | — | $ | — | ||||||||||||||||
U.S. government sponsored entities | 37,713 | — | 37,713 | — | — | — | — | — | ||||||||||||||||||||||||
Corporate debt | 22,576 | — | 22,576 | — | 26,172 | — | 26,172 | — | ||||||||||||||||||||||||
$ | 169,768 | $ | 109,479 | $ | 60,289 | $ | — | $ | 150,752 | $ | 124,580 | $ | 26,172 | $ | — | |||||||||||||||||
Long-term investments: | ||||||||||||||||||||||||||||||||
U.S. treasuries | $ | 4,211 | $ | 4,211 | $ | — | $ | — | $ | 24,423 | $ | 24,423 | $ | — | $ | — | ||||||||||||||||
U.S. government sponsored entities | 1,254 | — | 1,254 | — | 1,355 | — | 1,355 | — | ||||||||||||||||||||||||
Corporate debt | 29,716 | — | 29,716 | — | 26,471 | — | 26,471 | — | ||||||||||||||||||||||||
ABS and other | 7,600 | — | 7,600 | — | 8,560 | — | 8,560 | — | ||||||||||||||||||||||||
$ | 42,781 | $ | 4,211 | $ | 38,570 | $ | — | $ | 60,809 | $ | 24,423 | $ | 36,386 | $ | — | |||||||||||||||||
�� | ||||||||||||||||||||||||||||||||
Liabilities: | ||||||||||||||||||||||||||||||||
Contingent consideration | $ | 5,208 | $ | — | $ | — | $ | 5,208 | $ | 3,387 | $ | — | $ | — | $ | 3,387 | ||||||||||||||||
Deferred consideration | $ | 5,217 | $ | — | $ | 5,217 | $ | — | $ | 1,390 | $ | — | $ | 1,390 | $ | — | ||||||||||||||||
Deferred compensation liability | $ | 7,864 | $ | 7,864 | $ | — | $ | — | $ | 8,241 | $ | 8,241 | $ | — | $ | — | ||||||||||||||||
June 30, 2021 | December 31, 2020 | |||||||||||||||||||||||||||||||
Fair Value | Level 1 | Level 2 | Level 3 | Fair Value | Level 1 | Level 2 | Level 3 | |||||||||||||||||||||||||
Assets: | ||||||||||||||||||||||||||||||||
Assets held in rabbi trust | $ | 11,178 | $ | 0 | $ | 11,178 | $ | 0 | $ | 10,295 | $ | 0 | $ | 10,295 | $ | 0 | ||||||||||||||||
Cash equivalents (1) : | ||||||||||||||||||||||||||||||||
Commercial paper and other | $ | 1,800 | $ | 0 | $ | 1,800 | $ | 0 | $ | 9,399 | $ | 0 | $ | 9,399 | $ | 0 | ||||||||||||||||
Money market funds | 167,441 | 167,441 | 0 | 0 | 158,271 | 158,271 | 0 | 0 | ||||||||||||||||||||||||
$ | 169,241 | $ | 167,441 | $ | 1,800 | $ | 0 | $ | 167,670 | $ | 158,271 | $ | 9,399 | $ | 0 | |||||||||||||||||
Marketable debt securities, available-for-sale: | ||||||||||||||||||||||||||||||||
Short-term investments: | ||||||||||||||||||||||||||||||||
U.S. treasuries | $ | 74,436 | $ | 74,436 | $ | 0 | $ | 0 | $ | 75,970 | $ | 75,970 | $ | 0 | $ | 0 | ||||||||||||||||
U.S. government sponsored entities | 0 | 0 | 0 | 0 | 32,447 | 0 | 32,447 | 0 | ||||||||||||||||||||||||
Corporate debt | 72,736 | 0 | 72,736 | 0 | 49,841 | 0 | 49,841 | 0 | ||||||||||||||||||||||||
$ | 147,172 | $ | 74,436 | $ | 72,736 | $ | 0 | $ | 158,258 | $ | 75,970 | $ | 82,288 | $ | 0 | |||||||||||||||||
Long-term investments: | ||||||||||||||||||||||||||||||||
U.S. treasuries | $ | 52,196 | $ | 52,196 | $ | 0 | $ | 0 | $ | 3,641 | $ | 3,641 | $ | 0 | $ | 0 | ||||||||||||||||
U.S. government sponsored entities | 913 | 0 | 913 | 0 | 1,152 | 0 | 1,152 | 0 | ||||||||||||||||||||||||
Corporate debt | 37,649 | 0 | 37,649 | 0 | 36,287 | 0 | 36,287 | 0 | ||||||||||||||||||||||||
ABS and other | 6,756 | 0 | 6,756 | 0 | 6,693 | 0 | 6,693 | 0 | ||||||||||||||||||||||||
$ | 97,514 | $ | 52,196 | $ | 45,318 | $ | 0 | $ | 47,773 | $ | 3,641 | $ | 44,132 | $ | 0 | |||||||||||||||||
Liabilities: | ||||||||||||||||||||||||||||||||
Contingent consideration | $ | 6,817 | $ | 0 | $ | 0 | $ | 6,817 | $ | 5,572 | $ | 0 | $ | 0 | $ | 5,572 | ||||||||||||||||
Deferred consideration | $ | 11,998 | $ | 0 | $ | 11,998 | $ | 0 | $ | 15,248 | $ | 0 | $ | 15,248 | $ | 0 | ||||||||||||||||
Deferred compensation liability | $ | 8,346 | $ | 8,346 | $ | 0 | $ | 0 | $ | 8,287 | $ | 8,287 | $ | 0 | $ | 0 | ||||||||||||||||
(1) | Included in cash and cash equivalents on the accompanying condensed consolidated balance sheets. |
Six Months Ended June 30, | ||||||||
2020 | 2019 | |||||||
Beginning balance (1) | $ | 3,387 | $ | 2,875 | ||||
Contingent consideration in connection with acquisitions (2) | 1,800 | — | ||||||
Change in fair value of contingent consideration | 21 | (16 | ) | |||||
Payments of contingent consideration | — | — | ||||||
Ending balance | $ | 5,208 | $ | 2,859 | ||||
Six Months Ended June 30, | ||||||||
2021 | 2020 | |||||||
Beginning balance | $ | 5,572 | $ | 3,387 | ||||
Contingent consideration in connection with acquisitions (1) | (100 | ) | 1,800 | |||||
Change in fair value of contingent consideration | 1,345 | 21 | ||||||
Payments of contingent consideration | 0 | 0 | ||||||
Ending balance | $ | 6,817 | $ | 5,208 | ||||
(1) |
Contingent consideration in |
Fair Value at June 30, 2020 | Valuation Technique | Unobservable inputs | Range (Weighted Average) (1) | |||||||||||
Contingent consideration | $ | 5,208 | Discounted cash flow | Expected life of cash flows | 0.3-5.3 years | (2.1 years) | ||||||||
Discount rate | 4.8%-5.0% | (4.9%) | ||||||||||||
Probability of achievement | 0%-100.0% | (86.7%) | ||||||||||||
Fair Value at December 31, 2019 | Valuation Technique | Unobservable inputs | Range (Weighted Average) (1) | |||||||||||
Contingent consideration | $ | 3,387 | Discounted cash flow | Expected life of cash flows | 0.4-5.8 years | (2.4 years) | ||||||||
Discount rate | 3.6%-4.9% | (4.1%) | ||||||||||||
Probability of achievement | 33.0%-100.0% | (74.3%) |
Fair Value at June 30, 2021 | Valuation Technique | Unobservable inputs | Range (Weighted Average) (1) | |||||||||
Contingent consideration | $ | 6,817 | Discounted cash flow | Expected life of cash flows | 1.9-6.3 years (3.8 years) | |||||||
Discount rate | 1.9%-3.7% (2.8%) | |||||||||||
Probability of achievement | 33.8%-100.0% (90.1%) | |||||||||||
Fair Value at December 31, 2020 | Valuation Technique | Unobservable inputs | Range (Weighted Average) (1) | |||||||||
Contingent consideration | $ | 5,572 | Discounted cash flow | Expected life of cash flows | 2.4-6.8 years (4.4 years) | |||||||
Discount rate | 2.6%-4.3% (3.4%) | |||||||||||
Probability of achievement | 50.0%-100.0% (86.1%) |
(1) | Unobservable inputs were weighted by the relative fair value of the instruments. |
Fair Value at June 30, 2020 | Valuation Technique | Unobservable inputs | Range (Weighted (1) | |||||||||||
MSRs | $ | 2,316 | Discounted cash flow | Constant prepayment rates | 0.0%-20.0% (10.0%) | |||||||||
Constant default rate | 0.4%-5.0% (1.5%) | |||||||||||||
Loss severity | 24.2%-50.0% (30.1%) | |||||||||||||
Discount rate | 10.0%-10.0% (10.0%) | |||||||||||||
Fair Value at December 31, 2019 | Valuation Technique | Unobservable inputs | Range (Weighted (1) | |||||||||||
MSRs | $ | 2,204 | Discounted cash flow | Constant prepayment rates | 0.0%-20.0% (10.0%) | |||||||||
Constant default rate | 2.0%-2.0% (2.0%) | |||||||||||||
Loss severity | 40.0%-40.0% (40.0%) | |||||||||||||
Discount rate | 9.5%-9.7% (9.7%) |
Fair Value at June 30, 2021 | Valuation Technique | Unobservable inputs | Range (Weighted Average) (1) | |||||||||
MSRs | $ | 2,367 | Discounted cash flow | Constant prepayment rates | 0.0%-20.0% (10.0%) | |||||||
Constant default rate | 0.3%-4.5% (1.2%) | |||||||||||
Loss severity | 26.2%-31.4% (28.0%) | |||||||||||
Discount rate | 10.0%-10.0% (10.0%) | |||||||||||
Fair Value at December 31, 2020 | Valuation Technique | Unobservable inputs | Range (Weighted Average) (1) | |||||||||
MSRs | $ | 2,135 | Discounted cash flow | Constant prepayment rates | 0.0%-20.0% (10.0%) | |||||||
Constant default rate | 0.3%-4.1% (1.1%) | |||||||||||
Loss severity | 26.2%-31.4% (28.0%) | |||||||||||
Discount rate | 10.0%-10.0% (10.0%) |
(1) | Weighted average is based on the |
9. | Stockholders’ Equity |
10. | Stock-Based Compensation Plans |
RSA Grants to Non-employee Directors | RSU Grants to Employees | RSU Grants to Independent Contractors | Total | Weighted- Average Grant Date Fair Value Per Share | RSA Grants to Non-employee Directors | RSU Grants to Employees | RSU Grants to Independent Contractors | Total | Weighted- Average Grant Date Fair Value Per Share | |||||||||||||||||||||||||||||||
Nonvested shares at December 31, 2019 | 17,480 | 525,115 | 257,480 | 800,075 | $ | 33.91 | ||||||||||||||||||||||||||||||||||
Nonvested shares at December 31, 2020 (1) | 16,728 | 637,650 | 264,001 | 918,379 | $ | 33.73 | ||||||||||||||||||||||||||||||||||
Granted | 19,516 | 282,104 | 32,462 | 334,082 | 34.25 | 12,492 | 247,469 | 15,386 | 275,347 | $ | 38.57 | |||||||||||||||||||||||||||||
Vested | (18,004 | ) | (158,007 | ) | (39,472 | ) | (215,483 | ) | 32.48 | (16,728 | ) | (155,379 | ) | (27,936 | ) | (200,043 | ) | $ | 32.31 | |||||||||||||||||||||
Transferred | — | (19,059 | ) | 19,059 | — | 33.37 | 0 | (3,220 | ) | 3,220 | 0 | $ | 31.05 | |||||||||||||||||||||||||||
Forfeited/canceled | — | (12,874 | ) | (1,575 | ) | (14,449 | ) | 36.16 | 0 | (16,476 | ) | (3,585 | ) | (20,061 | ) | $ | 33.05 | |||||||||||||||||||||||
Nonvested shares at June 30, 2020 | 18,992 | 617,279 | 267,954 | 904,225 | $ | 34.35 | ||||||||||||||||||||||||||||||||||
Nonvested shares at June 30, 2021 (1) | 12,492 | 710,044 | 251,086 | 973,622 | $ | 34.86 | ||||||||||||||||||||||||||||||||||
Unrecognized stock-based compensation expense as of June 30, 2020 (1) | $ | 386 | $ | 19,687 | $ | 7,778 | $ | 27,851 | ||||||||||||||||||||||||||||||||
Unrecognized stock-based compensation expense as of June 30, 2021 (2) | $ | 378 | $ | 23,442 | $ | 6,634 | $ | 30,454 | ||||||||||||||||||||||||||||||||
Weighted average remaining vesting period (years) as of June 30, 2020 | 0.84 | 3.92 | 3.20 | 3.68 | ||||||||||||||||||||||||||||||||||||
Weighted average remaining vesting period (years) as of June 30, 2021 | 0.84 | 3.75 | 2.99 | 3.55 | ||||||||||||||||||||||||||||||||||||
(1) | Nonvested RSUs will be settled through the issuance of new shares of common stock. |
The total unrecognized compensation expense is expected to be recognized over a weighted-average period of approximately |
June 30, 2020 | ||||
2021 | 60,373 | |||
2022 | 281,193 | |||
341,566 | ||||
June 30, 2021 | ||||
2021 | 60,373 | |||
2022 | 281,193 | |||
341,566 | ||||
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||
ESPP | $ | 24 | $ | 36 | $ | 74 | $ | 83 | ||||||||
RSAs – non-employee directors | 113 | 213 | 224 | 373 | ||||||||||||
RSUs – employees | 1,747 | 1,514 | 3,201 | 3,170 | ||||||||||||
RSUs – independent contractors | 778 | 773 | 1,451 | 1,542 | ||||||||||||
$ | 2,662 | $ | 2,536 | $ | 4,950 | $ | 5,168 | |||||||||
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2020 | 2019 | 2020 | 2019 | |||||||||||||
ESPP | $ | 36 | $ | 38 | $ | 83 | $ | 68 | ||||||||
RSAs – non-employee directors | 213 | 154 | 373 | 324 | ||||||||||||
RSUs – employees | 1,514 | 1,622 | 3,170 | 2,967 | ||||||||||||
RSUs – independent contractors | 773 | 771 | 1,542 | 1,567 | ||||||||||||
$ | 2,536 | $ | 2,585 | $ | 5,168 | $ | 4,926 | |||||||||
Income Taxes |
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||||||||||||||||||
Amount | Rate | Amount | Rate | Amount | Rate | Amount | Rate | |||||||||||||||||||||||||
Income tax expense at the federal statutory rate | $ | 8,994 | 21.0 | % | $ | 31 | 21.0 | % | $ | 13,425 | 21.0 | % | $ | 4,018 | 21.0 | % | ||||||||||||||||
State income tax expense, net of federal benefit | 1,999 | 4.7 | % | (69 | ) | (46.8 | )% | 3,046 | 4.8 | % | 950 | 5.0 | % | |||||||||||||||||||
(Windfall) shortfall tax benefits, net related to stock-based compensation | (52 | ) | (0.1 | )% | 90 | 61.2 | % | (79 | ) | (0.1 | )% | 73 | 0.4 | % | ||||||||||||||||||
Change in valuation allowance | 17 | 0.0 | % | 96 | 65.4 | % | 188 | 0.3 | % | 460 | 2.4 | % | ||||||||||||||||||||
Permanent and other items (1) | 339 | 0.8 | % | (106 | ) | (72.4 | )% | 803 | 1.2 | % | 458 | 2.3 | % | |||||||||||||||||||
$ | 11,297 | 26.4 | % | $ | 42 | 28.4 | % | $ | 17,383 | 27.2 | % | $ | 5,959 | 31.1 | % | |||||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||||||||||
2020 | 2019 | 2020 | 2019 | |||||||||||||||||||||||||||||
Amount | Rate | Amount | Rate | Amount | Rate | Amount | Rate | |||||||||||||||||||||||||
Income tax expense at the federal statutory rate | $ | 31 | 21.0 | % | $ | 6,249 | 21.0 | % | $ | 4,018 | 21.0 | % | $ | 10,721 | 21.0 | % | ||||||||||||||||
State income tax expense, net of federal benefit | (69 | ) | (46.8 | )% | 1,346 | 4.5 | % | 950 | 5.0 | % | 2,240 | 4.4 | % | |||||||||||||||||||
Shortfall (windfall) tax benefits, net related to stock-based compensation | 90 | 61.2 | % | 11 | — | 73 | 0.4 | % | (254 | ) | (0.5 | )% | ||||||||||||||||||||
Change in valuation allowance | 96 | 65.4 | % | 200 | 0.7 | % | 460 | 2.4 | % | 466 | 0.9 | % | ||||||||||||||||||||
Permanent and other items (1) | (106 | ) | (72.4 | )% | 672 | 2.3 | % | 458 | 2.3 | % | 962 | 1.9 | % | |||||||||||||||||||
$ | 42 | 28.4 | % | $ | 8,478 | 28.5 | % | $ | 5,959 | 31.1 | % | $ | 14,135 | 27.7 | % | |||||||||||||||||
(1) | Permanent items relate principally to compensation charges, qualified transportation fringe benefits and meals and entertainment. |
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2020 | 2019 | 2020 | 2019 | |||||||||||||
Numerator (Basic and Diluted): | ||||||||||||||||
Net income | $ | 106 | $ | 21,279 | $ | 13,176 | $ | 36,917 | ||||||||
Denominator: | ||||||||||||||||
Basic | ||||||||||||||||
Weighted average common shares issued and outstanding | 39,306 | 39,073 | 39,261 | 39,035 | ||||||||||||
Deduct: Unvested RSAs (1) | (19 | ) | (20 | ) | (18 | ) | (24 | ) | ||||||||
Add: Fully vested DSUs (2) | 342 | 342 | 342 | 342 | ||||||||||||
Weighted Average Common Shares Outstanding | 39,629 | 39,395 | 39,585 | 39,353 | ||||||||||||
Basic earnings per common share | $ | — | $ | 0.54 | $ | 0.33 | $ | 0.94 | ||||||||
Diluted | ||||||||||||||||
Weighted Average Common Shares Outstanding from above | 39,629 | 39,395 | 39,585 | 39,353 | ||||||||||||
Add: Dilutive effect of RSUs, RSAs & ESPP | 44 | 132 | 77 | 171 | ||||||||||||
Weighted Average Common Shares Outstanding | 39,673 | 39,527 | 39,662 | 39,524 | ||||||||||||
Diluted earnings per common share | $ | — | $ | 0.54 | $ | 0.33 | $ | 0.93 | ||||||||
Antidilutive shares excluded from diluted earnings per common share (3) | 738 | 272 | 636 | 260 | ||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||
Numerator (Basic and Diluted): | ||||||||||||||||
Net income | $ | 31,532 | $ | 106 | $ | 46,544 | $ | 13,176 | ||||||||
Change in value for stock settled consideration | (42 | ) | 0 | 10 | 0 | |||||||||||
Adjusted net income | $ | 31,490 | $ | 106 | $ | 46,554 | $ | 13,176 | ||||||||
Denominator: | ||||||||||||||||
Basic | ||||||||||||||||
Weighted average common shares issued and outstanding | 39,549 | 39,306 | 39,491 | 39,261 | ||||||||||||
Deduct: Unvested RSAs (1) | (14 | ) | (19 | ) | (16 | ) | (18 | ) | ||||||||
Add: Fully vested DSUs (2) | 342 | 342 | 342 | 342 | ||||||||||||
Weighted average common shares outstanding | 39,877 | 39,629 | 39,817 | 39,585 | ||||||||||||
Basic earnings per common share | $ | 0.79 | $ | 0 | $ | 1.17 | $ | 0.33 | ||||||||
Diluted | ||||||||||||||||
Weighted average common shares outstanding from above | 39,877 | 39,629 | 39,817 | 39,585 | ||||||||||||
Add: Dilutive effect of RSUs, RSAs & ESPP | 149 | 44 | 182 | 77 | ||||||||||||
Add: Contingently issuable shares (3) | 113 | 0 | 113 | 0 | ||||||||||||
Weighted average common shares outstanding | 40,139 | 39,673 | 40,112 | 39,662 | ||||||||||||
Diluted earnings per common share | $ | 0.78 | $ | 0 | $ | 1.16 | $ | 0.33 | ||||||||
Antidilutive shares excluded from diluted earnings per common share (4) | 48 | 738 | 275 | 636 | ||||||||||||
(1) | RSAs were issued and outstanding to the non-employee directors and have aone-year vesting term subject to service requirements. See Note |
(2) | Shares are included in weighted average common shares outstanding as the shares are fully vested but have not yet been delivered. See Note |
(3) | Relates to contingently issuable stock settled consideration. |
Primarily pertaining to RSU grants to the Company’s employees and independent contractors. |
Commitments and Contingencies |
Three Months Ended June 30, | Three Months Ended June 30, | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2020 | 2019 | Change | 2021 | 2020 | Change | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Real Estate Brokerage | Number | Volume | Revenues | Number | Volume | Revenues | Number | Volume | Revenues | Number | Volume | Revenues | Number | Volume | Revenues | Number | Volume | Revenues | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
(in millions) | (in thousands) | (in millions) | (in thousands) | (in millions) | (in thousands) | (in millions) | (in thousands) | (in millions) | (in thousands) | (in millions) | (in thousands) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
<$1 million | 192 | $ | 118 | $ | 4,518 | 258 | $ | 170 | $ | 7,137 | (66 | ) | $ | (52 | ) | $ | (2,619 | ) | 297 | $ | 200 | $ | 7,618 | 192 | $ | 118 | $ | 4,518 | 105 | $ | 82 | $ | 3,100 | |||||||||||||||||||||||||||||||||||||||
Private client market ($1—$10 million) | 793 | 2,614 | 70,817 | 1,392 | 4,582 | 128,526 | (599 | ) | (1,968 | ) | (57,709 | ) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Middle market ( ³ $10—$20 million) | 43 | 618 | 11,591 | 111 | 1,523 | 26,944 | (68 | ) | (905 | ) | (15,353 | ) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Private client market ($1 - <$10 million) | 1,767 | 5,675 | 158,136 | 793 | 2,614 | 70,817 | 974 | 3,061 | 87,319 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Middle market ($10 - <$20 million) | 156 | 2,134 | 41,745 | 43 | 618 | 11,591 | 113 | 1,516 | 30,154 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Larger transaction market ( ³ $20 million) | 47 | 2,074 | 16,445 | 73 | 2,958 | 26,073 | (26 | ) | (884 | ) | (9,628 | ) | 110 | 5,551 | 45,404 | 47 | 2,074 | 16,445 | 63 | 3,477 | 28,959 | |||||||||||||||||||||||||||||||||||||||||||||||||||
1,075 | $ | 5,424 | $ | 103,371 | 1,834 | $ | 9,233 | $ | 188,680 | (759 | ) | $ | (3,809 | ) | $ | (85,309 | ) | 2,330 | $ | 13,560 | $ | 252,903 | 1,075 | $ | 5,424 | $ | 103,371 | 1,255 | $ | 8,136 | $ | 149,532 | ||||||||||||||||||||||||||||||||||||||||
Six Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2020 | 2019 | Change | 2021 | 2020 | Change | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Real Estate Brokerage | Number | Volume | Revenues | Number | Volume | Revenues | Number | Volume | Revenues | Number | Volume | Revenues | Number | Volume | Revenues | Number | Volume | Revenues | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
(in millions) | (in thousands) | (in millions) | (in thousands) | (in millions) | (in thousands) | (in millions) | (in thousands) | (in millions) | (in thousands) | (in millions) | (in thousands) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
<$1 million | 408 | $ | 254 | $ | 10,260 | 459 | $ | 301 | $ | 12,425 | (51 | ) | $ | (47 | ) | $ | (2,165 | ) | 524 | $ | 349 | $ | 13,756 | 408 | $ | 254 | $ | 10,260 | 116 | $ | 95 | $ | 3,496 | |||||||||||||||||||||||||||||||||||||||
Private client market ($1—$10 million) | 2,035 | 6,615 | 185,081 | 2,452 | 7,902 | 224,584 | (417 | ) | (1,287 | ) | (39,503 | ) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Middle market ( ³ $10—$20 million) | 134 | 1,840 | 34,259 | 203 | 2,768 | 50,524 | (69 | ) | (928 | ) | (16,265 | ) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Private client market ($1 - <$10 million) | 2,967 | 9,343 | 263,559 | 2,035 | 6,615 | 185,081 | 932 | 2,728 | 78,478 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Middle market ($10 - <$20 million) | 234 | 3,201 | 62,346 | 134 | 1,840 | 34,259 | 100 | 1,361 | 28,087 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Larger transaction market ( ³ $20 million) | 113 | 5,157 | 45,600 | 125 | 5,365 | 46,084 | (12 | ) | (208 | ) | (484 | ) | 193 | 9,531 | 76,038 | 113 | 5,157 | 45,600 | 80 | 4,374 | 30,438 | |||||||||||||||||||||||||||||||||||||||||||||||||||
2,690 | $ | 13,866 | $ | 275,200 | 3,239 | $ | 16,336 | $ | 333,617 | (549 | ) | $ | (2,470 | ) | $ | (58,417 | ) | 3,918 | $ | 22,424 | $ | 415,699 | 2,690 | $ | 13,866 | $ | 275,200 | 1,228 | $ | 8,558 | $ | 140,499 | ||||||||||||||||||||||||||||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
Real Estate Brokerage | 2020 | 2019 | 2020 | 2019 | ||||||||||||
Average Number of Investment Sales Professionals | 1,926 | 1,834 | 1,908 | 1,826 | ||||||||||||
Average Number of Transactions per Investment Sales Professional | 0.56 | 1.00 | 1.41 | 1.77 | ||||||||||||
Average Commission per Transaction | $ | 96,159 | $ | 102,879 | $ | 102,305 | $ | 103,000 | ||||||||
Average Commission Rate | 1.91 | % | 2.04 | % | 1.98 | % | 2.04 | % | ||||||||
Average Transaction Size (in thousands) | $ | 5,045 | $ | 5,034 | $ | 5,155 | $ | 5,044 | ||||||||
Total Number of Transactions | 1,075 | 1,834 | 2,690 | 3,239 | ||||||||||||
Total Sales Volume (in millions) | $ | 5,423 | $ | 9,233 | $ | 13,866 | $ | 16,336 | ||||||||
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
Financing (1) | 2020 | 2019 | 2020 | 2019 | ||||||||||||
Average Number of Financing Professionals | 87 | 104 | 88 | 106 | ||||||||||||
Average Number of Transactions per Financing Professional | 4.38 | 4.65 | 9.76 | 8.23 | ||||||||||||
Average Fee per Transaction | $ | 30,260 | $ | 35,406 | $ | 30,616 | $ | 34,576 | ||||||||
Average Fee Rate | 1.00 | % | 0.92 | % | 0.91 | % | 0.91 | % | ||||||||
Average Transaction Size (in thousands) | $ | 3,021 | $ | 3,851 | $ | 3,382 | $ | 3,812 | ||||||||
Total Number of Transactions | 381 | 484 | 859 | 872 | ||||||||||||
Total Financing Volume (in millions) | $ | 1,151 | $ | 1,864 | $ | 2,905 | $ | 3,324 |
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
Real Estate Brokerage | 2021 | 2020 | 2021 | 2020 | ||||||||||||
Average Number of Investment Sales Professionals | 1,934 | 1,926 | 1,946 | 1,908 | ||||||||||||
Average Number of Transactions per Investment Sales Professional | 1.20 | 0.56 | 2.01 | 1.41 | ||||||||||||
Average Commission per Transaction | $ | 108,542 | $ | 96,159 | $ | 106,100 | $ | 102,305 | ||||||||
Average Commission Rate | 1.87 | % | 1.91 | % | 1.85 | % | 1.98 | % | ||||||||
Average Transaction Size (in thousands) | $ | 5,820 | $ | 5,045 | $ | 5,723 | $ | 5,155 | ||||||||
Total Number of Transactions | 2,330 | 1,075 | 3,918 | 2,690 | ||||||||||||
Total Sales Volume (in millions) | $ | 13,560 | $ | 5,424 | $ | 22,424 | $ | 13,866 | ||||||||
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
Financing (1) | 2021 | 2020 | 2021 | 2020 | ||||||||||||
Average Number of Financing Professionals | 85 | 87 | 86 | 88 | ||||||||||||
Average Number of Transactions per Financing Professional | 8.05 | 4.38 | 13.70 | 9.76 | ||||||||||||
Average Fee per Transaction | $ | 34,783 | $ | 30,260 | $ | 32,972 | $ | 30,616 | ||||||||
Average Fee Rate | 0.82 | % | 1.00 | % | 0.86 | % | 0.91 | % | ||||||||
Average Transaction Size (in thousands) | $ | 4,228 | $ | 3,021 | $ | 3,824 | $ | 3,382 | ||||||||
Total Number of Transactions | 684 | 381 | 1,178 | 859 | ||||||||||||
Total Financing Volume (in millions) | $ | 2,892 | $ | 1,151 | $ | 4,504 | $ | 2,905 |
(1) | Operating metrics |
Three Months Ended June 30, 2020 | Percentage of Revenue | Three Months Ended June 30, 2019 | Percentage of Revenue | Change | Three Months Ended June 30, 2021 | Percentage of Revenue | Three Months Ended June 30, 2020 | Percentage of Revenue | Change | |||||||||||||||||||||||||||||||||||||||
Dollar | Percentage | Dollar | Percentage | |||||||||||||||||||||||||||||||||||||||||||||
Revenues: | ||||||||||||||||||||||||||||||||||||||||||||||||
Real estate brokerage commissions | $ | 103,371 | 88.1 | % | $ | 188,680 | 90.0 | % | $ | (85,309 | ) | (45.2 | )% | $ | 252,903 | 88.8 | % | $ | 103,371 | 88.1 | % | $ | 149,532 | 144.7 | % | |||||||||||||||||||||||
Financing fees | 12,703 | 10.8 | 17,742 | 8.5 | (5,039 | ) | (28.4 | )% | 28,214 | 9.9 | 12,703 | 10.8 | 15,511 | 122.1 | % | |||||||||||||||||||||||||||||||||
Other revenues | 1,326 | 1.1 | 3,171 | 1.5 | (1,845 | ) | (58.2 | )% | 3,829 | 1.3 | 1,326 | 1.1 | 2,503 | 188.8 | % | |||||||||||||||||||||||||||||||||
Total revenues | 117,400 | 100.0 | 209,593 | 100.0 | (92,193 | ) | (44.0 | )% | 284,946 | 100.0 | 117,400 | 100.0 | 167,546 | 142.7 | % | |||||||||||||||||||||||||||||||||
Operating expenses: | ||||||||||||||||||||||||||||||||||||||||||||||||
Cost of services | 73,743 | 62.8 | 127,847 | 61.0 | (54,104 | ) | (42.3 | )% | 178,585 | 62.7 | 73,743 | 62.8 | 104,842 | 142.2 | % | |||||||||||||||||||||||||||||||||
Selling, general and administrative | 43,519 | 37.1 | 52,836 | 25.2 | (9,317 | ) | (17.6 | )% | 61,797 | 21.7 | 43,519 | 37.1 | 18,278 | 42.0 | % | |||||||||||||||||||||||||||||||||
Depreciation and amortization | 2,752 | 2.3 | 1,932 | 0.9 | 820 | 42.4 | % | 2,959 | 1.0 | 2,752 | 2.3 | 207 | 7.5 | % | ||||||||||||||||||||||||||||||||||
Total operating expenses | 120,014 | 102.2 | 182,615 | 87.1 | (62,601 | ) | (34.3 | )% | 243,341 | 85.4 | 120,014 | 102.2 | 123,327 | 102.8 | % | |||||||||||||||||||||||||||||||||
Operating (loss) income | (2,614 | ) | (2.2 | ) | 26,978 | 12.9 | (29,592 | ) | (109.7 | )% | ||||||||||||||||||||||||||||||||||||||
Operating income (loss) | 41,605 | 14.6 | (2,614 | ) | (2.2 | ) | 44,219 | nm | (2) | |||||||||||||||||||||||||||||||||||||||
Other income (expense), net | 2,975 | 2.5 | 3,119 | 1.5 | (144 | ) | (4.6 | )% | 1,370 | 0.5 | 2,975 | 2.5 | (1,605 | ) | (53.9 | )% | ||||||||||||||||||||||||||||||||
Interest expense | (213 | ) | (0.2 | ) | (340 | ) | (0.2 | ) | 127 | (37.4 | )% | (146 | ) | 0.0 | (213 | ) | (0.2 | ) | 67 | (31.5 | )% | |||||||||||||||||||||||||||
Income before provision for income taxes | 148 | 0.1 | 29,757 | 14.2 | (29,609 | ) | (99.5 | )% | 42,829 | 15.1 | 148 | 0.1 | 42,681 | nm | (2) | |||||||||||||||||||||||||||||||||
Provision for income taxes | 42 | 0.0 | 8,478 | 4.0 | (8,436 | ) | (99.5 | )% | 11,297 | 4.0 | 42 | 0.0 | 11,255 | nm | (2) | |||||||||||||||||||||||||||||||||
Net income | $ | 106 | 0.1 | % | $ | 21,279 | 10.2 | % | $ | (21,173 | ) | (99.5 | )% | $ | 31,532 | 11.1 | % | $ | 106 | 0.1 | % | $ | 31,426 | nm | (2) | |||||||||||||||||||||||
Adjusted EBITDA (1) | $ | 4,150 | 3.5 | % | $ | 32,016 | 15.3 | % | $ | (27,866 | ) | (87.0 | )% | $ | 48,110 | 16.9 | % | $ | 4,150 | 3.5 | % | $ | 43,960 | nm | (2) | |||||||||||||||||||||||
(1) | Adjusted EBITDA is not a measurement of our financial performance under U.S. generally accepted accounting principles (“U.S. GAAP”) and should not be considered as an alternative to net income, operating income or any other measures derived in accordance with U.S. GAAP. For a definition of Adjusted EBITDA and a reconciliation of Adjusted EBITDA to net income, see “Non-GAAP Financial Measure.” |
(2) | Not meaningful |
Six Months Ended June 30, 2021 | Percentage of Revenue | Six Months Ended June 30, 2020 | Percentage of Revenue | Change | ||||||||||||||||||||
Dollar | Percentage | |||||||||||||||||||||||
Revenues: | ||||||||||||||||||||||||
Real estate brokerage commissions | $ | 415,699 | 88.7 | % | $ | 275,200 | 89.3 | % | $ | 140,499 | 51.1 | % | ||||||||||||
Financing fees | 46,057 | 9.8 | 28,054 | 9.1 | 18,003 | 64.2 | % | |||||||||||||||||
Other revenues | 7,167 | 1.5 | 4,863 | 1.6 | 2,304 | 47.4 | % | |||||||||||||||||
Total revenues | 468,923 | 100.0 | 308,117 | 100.0 | 160,806 | 52.2 | % | |||||||||||||||||
Operating expenses: | ||||||||||||||||||||||||
Cost of services | 287,688 | 61.4 | 187,500 | 60.9 | 100,188 | 53.4 | % | |||||||||||||||||
Selling, general and administrative | 113,474 | 24.2 | 98,379 | 31.9 | 15,095 | 15.3 | % | |||||||||||||||||
Depreciation and amortization | 5,956 | 1.3 | 5,216 | 1.7 | 740 | 14.2 | % | |||||||||||||||||
Total operating expenses | 407,118 | 86.9 | 291,095 | 94.5 | 116,023 | 39.9 | % | |||||||||||||||||
Operating income | 61,805 | 13.1 | 17,022 | 5.5 | 44,783 | 263.1 | % | |||||||||||||||||
Other income (expense), net | 2,414 | 0.5 | 2,609 | 0.8 | (195 | ) | (7.5 | )% | ||||||||||||||||
Interest expense | (292 | ) | 0.0 | (496 | ) | (0.1 | ) | 204 | (41.1 | )% | ||||||||||||||
Income before provision for income taxes | 63,927 | 13.6 | 19,135 | 6.2 | 44,792 | 234.1 | % | |||||||||||||||||
Provision for income taxes | 17,383 | 3.7 | 5,959 | 1.9 | 11,424 | 191.7 | % | |||||||||||||||||
Net income | $ | 46,544 | 9.9 | % | $ | 13,176 | 4.3 | % | $ | 33,368 | 253.2 | % | ||||||||||||
Adjusted EBITDA (1) | $ | 73,805 | 15.7 | % | $ | 26,528 | 8.6 | % | $ | 47,277 | 178.2 | % | ||||||||||||
(1) | Adjusted EBITDA is not a measurement of our financial performance under U.S. generally accepted accounting principles (“U.S. GAAP”) and should not be considered as an alternative to net income, operating income or any other measures derived in accordance with U.S. GAAP. For a definition of Adjusted EBITDA and a reconciliation of Adjusted EBITDA to net income, see “Non-GAAP Financial Measure.” |
Six Months Ended June 30, 2020 | Percentage of Revenue | Six Months Ended June 30, 2019 | Percentage of Revenue | Change | ||||||||||||||||||||
Dollar | Percentage | |||||||||||||||||||||||
Revenues: | ||||||||||||||||||||||||
Real estate brokerage commissions | $ | 275,200 | 89.3 | % | $ | 333,617 | 90.1 | % | $ | (58,417 | ) | (17.5 | )% | |||||||||||
Financing fees | 28,054 | 9.1 | 31,474 | 8.5 | (3,420 | ) | (10.9 | )% | ||||||||||||||||
Other revenues | 4,863 | 1.6 | 5,209 | 1.4 | (346 | ) | (6.6 | )% | ||||||||||||||||
Total revenues | 308,117 | 100.0 | 370,300 | 100.0 | (62,183 | ) | (16.8 | )% | ||||||||||||||||
Operating expenses: | ||||||||||||||||||||||||
Cost of services | 187,500 | 60.9 | 219,535 | 59.3 | (32,035 | ) | (14.6 | )% | ||||||||||||||||
Selling, general and administrative | 98,379 | 31.9 | 101,754 | 27.5 | (3,375 | ) | (3.3 | )% | ||||||||||||||||
Depreciation and amortization | 5,216 | 1.7 | 3,764 | 1.0 | 1,452 | 38.6 | % | |||||||||||||||||
Total operating expenses | 291,095 | 94.5 | 325,053 | 87.8 | (33,958 | ) | (10.4 | )% | ||||||||||||||||
Operating income | 17,022 | 5.5 | 45,247 | 12.2 | (28,225 | ) | (62.4 | )% | ||||||||||||||||
Other income (expense), net | 2,609 | 0.8 | 6,494 | 1.8 | (3,885 | ) | (59.8 | )% | ||||||||||||||||
Interest expense | (496 | ) | (0.1 | ) | (689 | ) | (0.2 | ) | 193 | (28.0 | )% | |||||||||||||
Income before provision for income taxes | 19,135 | 6.2 | 51,052 | 13.8 | (31,917 | ) | (62.5 | )% | ||||||||||||||||
Provision for income taxes | 5,959 | 1.9 | 14,135 | 3.8 | (8,176 | ) | (57.8 | )% | ||||||||||||||||
Net income | $ | 13,176 | 4.3 | % | 36,917 | 10.0 | % | $ | (23,741 | ) | (64.3 | )% | ||||||||||||
Adjusted EBITDA (1) | $ | 26,528 | 8.6 | % | $ | 55,175 | 14.9 | % | $ | (28,647 | ) | (51.9 | )% | |||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2020 | 2019 | 2020 | 2019 | |||||||||||||
Net income | $ | 106 | $ | 21,279 | $ | 13,176 | $ | 36,917 | ||||||||
Adjustments: | ||||||||||||||||
Interest income and other (1) | (1,198 | ) | (2,562 | ) | (3,201 | ) | (5,103 | ) | ||||||||
Interest expense | 213 | 340 | 496 | 689 | ||||||||||||
Provision for income taxes | 42 | 8,478 | 5,959 | 14,135 | ||||||||||||
Depreciation and amortization | 2,752 | 1,932 | 5,216 | 3,764 | ||||||||||||
Stock-based compensation | 2,536 | 2,585 | 5,168 | 4,926 | ||||||||||||
Non-cash MSR activity(2) | (301 | ) | (36 | ) | (286 | ) | (153 | ) | ||||||||
Adjusted EBITDA (3) | $ | 4,150 | $ | 32,016 | $ | 26,528 | $ | 55,175 | ||||||||
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||
Net income | $ | 31,532 | $ | 106 | $ | 46,544 | $ | 13,176 | ||||||||
Adjustments: | ||||||||||||||||
Interest income and other (1) | (436 | ) | (1,198 | ) | (967 | ) | (3,201 | ) | ||||||||
Interest expense | 146 | 213 | 292 | 496 | ||||||||||||
Provision for income taxes | 11,297 | 42 | 17,383 | 5,959 | ||||||||||||
Depreciation and amortization | 2,959 | 2,752 | 5,956 | 5,216 | ||||||||||||
Stock-based compensation | 2,662 | 2,536 | 4,950 | 5,168 | ||||||||||||
Non-cash MSR activity(2) | (50 | ) | (301 | ) | (353 | ) | (286 | ) | ||||||||
Adjusted EBITDA (3) | $ | 48,110 | $ | 4,150 | $ | 73,805 | $ | 26,528 | ||||||||
(1) | Other includes net realized gains (losses) on marketable debt securities, available-for-sale. |
(2) | Non-cash MSR activity includes the assumption of servicing obligations. |
(3) | The |
Six Months Ended June 30, | ||||||||
2020 | 2019 | |||||||
Net cash used in operating activities | $ | (51,849 | ) | $ | (24,363 | ) | ||
Net cash (used in) provided by investing activities | (16,459 | ) | 19,626 | |||||
Net cash used in financing activities | (9,332 | ) | (3,188 | ) | ||||
Effect of currency exchange rate changes on cash and cash equivalents | (150 | ) | — | |||||
Net decrease in cash and cash equivalents | (77,790 | ) | (7,925 | ) | ||||
Cash and cash equivalents at beginning of period | 232,670 | 214,683 | ||||||
Cash and cash equivalents at end of period | $ | 154,880 | $ | 206,758 | ||||
Six Months Ended June 30, | ||||||||
2021 | 2020 | |||||||
Net cash provided by (used in) operating activities | $ | 33,466 | $ | (51,849 | ) | |||
Net cash used in investing activities | (41,850 | ) | (16,459 | ) | ||||
Net cash used in financing activities | (4,458 | ) | (9,332 | ) | ||||
Effect of currency exchange rate changes on cash and cash equivalents | 104 | (150 | ) | |||||
Net decrease in cash and cash equivalents | (12,738 | ) | (77,790 | ) | ||||
Cash and cash equivalents at beginning of period | 243,152 | 232,670 | ||||||
Cash and cash equivalents at end of period | $ | 230,414 | $ | 154,880 | ||||
Change in Interest Rates | Approximate Change in Fair Value of Investments Increase (Decrease) | Approximate Change in Fair Value of Investments Increase (Decrease) | ||||||
2% Decrease | $ | 2,502 | $ | 2,417 | ||||
1% Decrease | $ | 1,626 | $ | 1,700 | ||||
1% Increase | $ | (2,330 | ) | $ | (3,043 | ) | ||
2% Increase | $ | (4,658 | ) | $ | (6,085 | ) |
Exhibit | Description | |
10.1†* | Change in Control Policy dated August 3, 2021 | |
10.2†* | Amended & Restated Death & Disability Policy dated August 3, 2021 | |
31.1* | Certification of Chief Executive Officer pursuant to Rule 13a-14(a) under the Exchange Act, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | |
31.2* | Certification of Chief Financial Officer pursuant to Rule 13a-14(a) under the Exchange Act, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | |
32.1** | Certifications of Chief Executive Officer and Chief Financial Officer pursuant to Rule 13a-14(b) under the Exchange Act and 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. | |
The following financial statements from the Company’s Quarterly Report on Form 10-Q for the quarter ended June 30, | ||
Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) |
* | Filed herewith. |
** | Furnished, not filed. |
† | Indicates management contract or compensatory plan. |
Marcus & Millichap, Inc | ||||||||
Date: | August | By: | /s/Hessam Nadji | |||||
Hessam Nadji President and Chief Executive Officer (Principal Executive Officer) |
Date: | August | By: | /s/ | |||||||
Chief Financial Officer (Principal Financial Officer) |