Document And Entity Information
Document And Entity Information - shares | 3 Months Ended | |
Mar. 31, 2018 | May 01, 2018 | |
Entity Information [Line Items] | ||
Document Period End Date | Mar. 31, 2018 | |
Entity Registrant Name | REALOGY HOLDINGS CORP. | |
Entity Central Index Key | 1,398,987 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Document Type | 10-Q | |
Document Fiscal Year Focus | 2,018 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false | |
Entity Common Stock, Shares Outstanding | 127,514,633 | |
Realogy Group LLC [Member] | ||
Entity Information [Line Items] | ||
Entity Registrant Name | REALOGY GROUP LLC | |
Entity Central Index Key | 1,355,001 | |
Entity Filer Category | Non-accelerated Filer |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations - USD ($) shares in Millions, $ in Millions | 3 Months Ended | ||||
Mar. 31, 2018 | Mar. 31, 2017 | ||||
Revenues | |||||
Gross commission income | [1] | $ 902 | $ 881 | [2] | |
Service revenue | [3] | 197 | 194 | [2] | |
Franchise fees | [4] | 79 | 75 | [2] | |
Other | [5] | 51 | 53 | [2] | |
Net revenues | [6],[7] | 1,229 | 1,203 | [2] | |
Expenses | |||||
Commission and other agent-related costs | 645 | 605 | |||
Operating | 392 | 383 | |||
Marketing | 67 | 62 | |||
General and administrative | 89 | 89 | |||
Restructuring costs, net | 30 | 5 | [8] | ||
Depreciation and amortization | 48 | [9] | 50 | [10] | |
Interest expense, net | 33 | [9] | 39 | ||
Loss on the early extinguishment of debt | [11] | 7 | 4 | ||
Total expenses | 1,311 | 1,237 | |||
Loss before income taxes, equity in losses and noncontrolling interests | (82) | (34) | |||
Income tax benefit | (19) | [9] | (9) | ||
Equity in losses of unconsolidated entities | 4 | 3 | |||
Net loss | (67) | (28) | |||
Less: Net income attributable to noncontrolling interests | 0 | 0 | |||
Net loss attributable to Realogy Holdings and Realogy Group | $ (67) | $ (28) | |||
Loss per share attributable to Realogy Holdings: | |||||
Basic loss per share | $ (0.51) | $ (0.20) | |||
Diluted loss per share | $ (0.51) | $ (0.20) | |||
Weighted average common and common equivalent shares of Realogy Holdings outstanding: | |||||
Basic | 130.3 | 139.7 | |||
Diluted | 130.3 | 139.7 | |||
Cash dividends declared per share | $ 0.09 | $ 0.09 | |||
[1] | During both the three months ended March 31, 2018 and March 31, 2017, approximately 74% of the Company's total net revenues, related to gross commission income at the Company Owned Brokerage Services segment which is recognized at a point in time at the closing of a homesale transaction. | ||||
[2] | Prior period amounts have not been adjusted under the modified retrospective method. | ||||
[3] | During both the three months ended March 31, 2018 and March 31, 2017, approximately 16% of the Company's total net revenues related to service fees primarily consisting of title and escrow fees at the Title and Settlement Services segment (10%), which are recognized at a point in time at the closing of a homesale transaction, and relocation fees at the Relocation Services segment (6%), which are recognized as revenue when or as the related performance obligation is satisfied, which is dependent on the type of service performed. Relocation fees at the Relocation Services segment primarily include: (i) referral fees which are recognized at a point in time at the closing of a homesale transaction, (ii) outsourcing fees, which are management fees charged to clients frequently related to a bundle of relocation services performed and are recognized over the average time period to complete a move, and (iii) referral commissions from third party suppliers which are recognized at the time of the completion of the related service. | ||||
[4] | During both the three months ended March 31, 2018 and March 31, 2017, approximately 6% of the Company's total net revenues related to franchise fees at the Real Estate Franchise Services segment, primarily domestic royalties, which are recognized at a point in time when the underlying franchisee revenue is earned (upon close of the homesale transaction). | ||||
[5] | During both the three months ended March 31, 2018 and March 31, 2017, approximately 4% of the Company's total net revenues related to other revenue which comprised of brand marketing funds received at the Real Estate Franchise Services segment from franchisees and other miscellaneous revenues across all of the business segments. | ||||
[6] | Revenues for the Relocation Services segment include intercompany referral commissions paid by the Company Owned Real Estate Brokerage Services segment of $8 million for both the three months ended March 31, 2018 and 2017. Such amounts are recorded as contra-revenues by the Company Owned Real Estate Brokerage Services segment. There are no other material intersegment transactions. | ||||
[7] | Transactions between segments are eliminated in consolidation. Revenues for the Real Estate Franchise Services segment include intercompany royalties and marketing fees paid by the Company Owned Real Estate Brokerage Services segment of $63 million and $61 million for the three months ended March 31, 2018 and 2017, respectively. Such amounts are eliminated through the Corporate and Other line. | ||||
[8] | Includes restructuring charges of $2 million in the Real Estate Franchise Services segment, $17 million in the Company Owned Real Estate Brokerage Services segment, $8 million in the Cartus segment, $1 million at Title and Settlement Services segment and $2 million in Corporate and Other for the three months ended March 31, 2018. Includes restructuring charges of $5 million in the Company Owned Real Estate Brokerage Services segment for the three months ended March 31, 2017. | ||||
[9] | Includes the elimination of transactions between segments. | ||||
[10] | Depreciation and amortization for the three months ended March 31, 2018 includes $2 million of amortization expense related to Guaranteed Rate Affinity's purchase accounting included in the "Equity in losses of unconsolidated entities" line on the Condensed Consolidated Statement of Operations. | ||||
[11] | Loss on the early extinguishment of debt is recorded in the Corporate and Other segment. |
Condensed Consolidated Stateme3
Condensed Consolidated Statements of Comprehensive Income (Loss) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Statement of Comprehensive Income [Abstract] | ||
Net loss | $ (67) | $ (28) |
Currency translation adjustment | 1 | 1 |
Defined benefit pension plan - amortization of actuarial loss to periodic pension cost | 1 | 0 |
Other comprehensive income, before tax | 2 | 1 |
Income tax expense (benefit) related to items of other comprehensive income amounts | 0 | 0 |
Other comprehensive income, net of tax | 2 | 1 |
Comprehensive loss | (65) | (27) |
Less: comprehensive income attributable to noncontrolling interests | 0 | 0 |
Comprehensive loss attributable to Realogy Holdings and Realogy Group | $ (65) | $ (27) |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Millions | Mar. 31, 2018 | Dec. 31, 2017 |
Current assets: | ||
Cash and cash equivalents | $ 182 | $ 227 |
Restricted cash | 6 | 7 |
Trade receivables (net of allowance for doubtful accounts of $10 and $11) | 163 | 153 |
Relocation receivables | 250 | 223 |
Other current assets | 159 | 179 |
Total current assets | 760 | 789 |
Property and equipment, net | 281 | 289 |
Goodwill | 3,711 | 3,710 |
Trademarks | 749 | 749 |
Franchise agreements, net | 1,277 | 1,294 |
Other intangibles, net | 276 | 284 |
Other non-current assets | 271 | 222 |
Total assets | 7,325 | 7,337 |
Current liabilities: | ||
Accounts payable | 139 | 156 |
Securitization obligations | 184 | 194 |
Current portion of long-term debt | 332 | 127 |
Accrued expenses and other current liabilities | 426 | 478 |
Total current liabilities | 1,081 | 955 |
Long-term debt | 3,263 | 3,221 |
Deferred income taxes | 291 | 327 |
Other non-current liabilities | 262 | 212 |
Total liabilities | 4,897 | 4,715 |
Equity: | ||
Realogy Holdings preferred stock: $.01 par value; 50,000,000 shares authorized, none issued and outstanding at March 31, 2018 and December 31, 2017 | 0 | 0 |
Realogy Holdings common stock: $.01 par value; 400,000,000 shares authorized, 128,755,023 shares issued and outstanding at March 31, 2018 and 131,636,870 shares issued and outstanding at December 31, 2017 | 1 | 1 |
Additional paid-in capital | 5,179 | 5,285 |
Accumulated deficit | (2,711) | (2,631) |
Accumulated other comprehensive loss | (44) | (37) |
Total stockholders' equity | 2,425 | 2,618 |
Noncontrolling interests | 3 | 4 |
Total equity | 2,428 | 2,622 |
Total liabilities and equity | $ 7,325 | $ 7,337 |
Condensed Consolidated Balance5
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Millions | Mar. 31, 2018 | Dec. 31, 2017 |
Statement of Financial Position [Abstract] | ||
Allowance for doubtful accounts | $ 10 | $ 11 |
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 400,000,000 | 400,000,000 |
Common stock, shares outstanding | 128,755,023 | 131,636,870 |
Preferred stock, par value | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 50,000,000 | 50,000,000 |
Preferred stock, shares outstanding | 0 | 0 |
Condensed Consolidated Stateme6
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Millions | 3 Months Ended | |||
Mar. 31, 2018 | Mar. 31, 2017 | |||
Operating Activities | ||||
Net loss | $ (67) | $ (28) | ||
Adjustments to reconcile net loss to net cash used in operating activities: | ||||
Depreciation and amortization | 48 | [1] | 50 | [2] |
Deferred income taxes | (28) | (10) | ||
Amortization of deferred financing costs and discount | 4 | 4 | ||
Loss on the early extinguishment of debt | 7 | 4 | ||
Equity in losses of unconsolidated entities | 4 | 3 | ||
Stock-based compensation | 9 | 12 | ||
Mark-to-market adjustments on derivatives | (12) | (1) | ||
Other adjustments to net loss | 4 | (1) | ||
Net change in assets and liabilities, excluding the impact of acquisitions and dispositions: | ||||
Trade receivables | (8) | 4 | ||
Relocation receivables | (27) | 22 | ||
Other assets | (17) | (24) | ||
Accounts payable, accrued expenses and other liabilities | (45) | (44) | ||
Dividends received from unconsolidated entities | 1 | 1 | ||
Other, net | (3) | (4) | ||
Net cash used in operating activities | (130) | (12) | ||
Investing Activities | ||||
Property and equipment additions | (25) | (28) | ||
Payments for acquisitions, net of cash acquired | 0 | (1) | ||
Investment in unconsolidated entities | (4) | (3) | ||
Proceeds from investments in unconsolidated entities | 19 | 0 | ||
Other, net | 1 | (1) | ||
Net cash used in investing activities | (9) | (33) | ||
Financing Activities | ||||
Net change in revolving credit facility | 232 | 110 | ||
Payments for refinancing of Term Loan B | (4) | 0 | ||
Proceeds from refinancing of Term Loan A & A-1 | 17 | 0 | ||
Amortization payments on term loan facilities | (3) | (10) | ||
Net change in securitization obligations | (11) | (33) | ||
Debt issuance costs | (16) | (6) | ||
Repurchase of common stock | (94) | (57) | ||
Dividends paid on common stock | (12) | (13) | ||
Proceeds from exercise of stock options | 0 | 1 | ||
Taxes paid related to net share settlement for stock-based compensation | (9) | (10) | ||
Payments of contingent consideration related to acquisitions | 0 | (4) | ||
Other, net | (7) | (5) | ||
Net cash provided by (used in) financing activities | 93 | (27) | ||
Effect of changes in exchange rates on cash, cash equivalents and restricted cash | 0 | 1 | ||
Net decrease in cash, cash equivalents and restricted cash | (46) | (71) | ||
Cash, cash equivalents and restricted cash, beginning of period | 234 | 281 | ||
Cash, cash equivalents and restricted cash, end of period | 188 | 210 | ||
Supplemental Disclosure of Cash Flow Information | ||||
Interest payments (including securitization interest of $2 and $1 for the periods presented) | 21 | 24 | ||
Income tax payments, net | 4 | 2 | ||
Securitization Interest | $ 2 | $ 1 | ||
[1] | Includes the elimination of transactions between segments. | |||
[2] | Depreciation and amortization for the three months ended March 31, 2018 includes $2 million of amortization expense related to Guaranteed Rate Affinity's purchase accounting included in the "Equity in losses of unconsolidated entities" line on the Condensed Consolidated Statement of Operations. |
Basis Of Presentation
Basis Of Presentation | 3 Months Ended |
Mar. 31, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis Of Presentation | BASIS OF PRESENTATION Realogy Holdings Corp. ("Realogy Holdings", "Realogy" or the "Company") is a holding company for its consolidated subsidiaries including Realogy Intermediate Holdings LLC ("Realogy Intermediate") and Realogy Group LLC ("Realogy Group") and its consolidated subsidiaries. Realogy, through its subsidiaries, is a global provider of residential real estate services. Neither Realogy Holdings, the indirect parent of Realogy Group, nor Realogy Intermediate, the direct parent company of Realogy Group, conducts any operations other than with respect to its respective direct or indirect ownership of Realogy Group. As a result, the consolidated financial positions, results of operations, comprehensive income and cash flows of Realogy Holdings, Realogy Intermediate and Realogy Group are the same. The accompanying Condensed Consolidated Financial Statements include the financial statements of Realogy Holdings and Realogy Group. Realogy Holdings' only asset is its investment in the common stock of Realogy Intermediate, and Realogy Intermediate's only asset is its investment in Realogy Group. Realogy Holdings' only obligations are its guarantees of certain borrowings and certain franchise obligations of Realogy Group. All expenses incurred by Realogy Holdings and Realogy Intermediate are for the benefit of Realogy Group and have been reflected in Realogy Group's Condensed Consolidated Financial Statements. The Condensed Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States of America and with Article 10 of Regulation S-X. Interim results may not be indicative of full year performance because of seasonal and short-term variations. The Company has eliminated all material intercompany transactions and balances between entities consolidated in these financial statements. In presenting the Condensed Consolidated Financial Statements, management makes estimates and assumptions that affect the amounts reported and the related disclosures. Estimates, by their nature, are based on judgment and available information. Accordingly, actual results could differ materially from those estimates. Certain reclassifications have been made to prior period amounts to conform to the current period presentation. In management's opinion, the accompanying unaudited Condensed Consolidated Financial Statements reflect all normal and recurring adjustments necessary for a fair statement of Realogy Holdings and Realogy Group's financial position as of March 31, 2018 and the results of operations and comprehensive loss for the three months ended March 31, 2018 and 2017 and cash flows for the three months ended March 31, 2018 and 2017 . The Consolidated Balance Sheet at December 31, 2017 was derived from audited annual financial statements but does not contain all of the footnote disclosures from the annual financial statements. The Condensed Consolidated Financial Statements should be read in conjunction with the audited Consolidated Financial Statements and notes thereto included in the Annual Report on Form 10-K for the year ended December 31, 2017 . Fair Value Measurements The following tables present the Company’s assets and liabilities that are measured at fair value on a recurring basis and are categorized using the fair value hierarchy. The fair value hierarchy has three levels based on the reliability of the inputs used to determine fair value. Level Input: Input Definitions: Level I Inputs are unadjusted, quoted prices for identical assets or liabilities in active markets at the measurement date. Level II Inputs other than quoted prices included in Level I that are observable for the asset or liability through corroboration with market data at the measurement date. Level III Unobservable inputs that reflect management’s best estimate of what market participants would use in pricing the asset or liability at the measurement date. The availability of observable inputs can vary from asset to asset and is affected by a wide variety of factors, including, for example, the type of asset, whether the asset is new and not yet established in the marketplace, and other characteristics particular to the transaction. To the extent that valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment. Accordingly, the degree of judgment exercised by the Company in determining fair value is greatest for instruments categorized in Level III. In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes, the level in the fair value hierarchy within which the fair value measurement in its entirety falls is determined based on the lowest level input that is significant to the fair value measurement in its entirety. The fair value of financial instruments is generally determined by reference to quoted market values. In cases where quoted market prices are not available, fair value is based on estimates using present value or other valuation techniques, as appropriate. The fair value of interest rate swaps is determined based upon a discounted cash flow approach. The Company measures financial instruments at fair value on a recurring basis and recognizes transfers within the fair value hierarchy at the end of the fiscal quarter in which the change in circumstances that caused the transfer occurred. The following table summarizes fair value measurements by level at March 31, 2018 for assets and liabilities measured at fair value on a recurring basis: Level I Level II Level III Total Deferred compensation plan assets (included in other non-current assets) $ 3 $ — $ — $ 3 Interest rate swaps (included in other non-current assets) — 9 — 9 Interest rate swaps (included in other non-current liabilities) — 6 — 6 Contingent consideration for acquisitions (included in accrued expenses and other current liabilities and other non-current liabilities) — — 34 34 The following table summarizes fair value measurements by level at December 31, 2017 for assets and liabilities measured at fair value on a recurring basis: Level I Level II Level III Total Deferred compensation plan assets (included in other non-current assets) $ 3 $ — $ — $ 3 Interest rate swaps (included in other current and non-current liabilities) — 13 — 13 Contingent consideration for acquisitions (included in accrued expenses and other current liabilities and other non-current liabilities) — — 34 34 The fair value of the Company’s contingent consideration for acquisitions is measured using a probability weighted-average discount rate to estimate future cash flows based upon the likelihood of achieving future operating results for individual acquisitions. These assumptions are deemed to be unobservable inputs and as such the Company’s contingent consideration is classified within Level III of the valuation hierarchy. The Company reassesses the fair value of the contingent consideration liabilities on a quarterly basis. The fair value of contingent consideration did not change during the first quarter of 2018 and remained at $34 million at March 31, 2018 and December 31, 2017 . The following table summarizes the principal amount of the Company’s indebtedness compared to the estimated fair value, primarily determined by quoted market values, at: March 31, 2018 December 31, 2017 Debt Principal Amount Estimated Principal Amount Estimated Senior Secured Credit Facility: Revolving Credit Facility $ 302 $ 302 $ 70 $ 70 Term Loan B 1,077 1,083 1,083 1,085 Term Loan A Facility: Term Loan A 750 750 391 393 Term Loan A-1 — — 342 343 4.50% Senior Notes 450 452 450 457 5.25% Senior Notes 550 553 550 569 4.875% Senior Notes 500 479 500 495 Securitization obligations 184 184 194 194 _______________ (a) The fair value of the Company's indebtedness is categorized as Level II. Equity Method Investments At March 31, 2018 and December 31, 2017 , the Company had various equity method investments aggregating $55 million and $74 million , respectively, which are recorded within other non-current assets on the accompanying Condensed Consolidated Balance Sheets. The $55 million investment balance at March 31, 2018 included $47 million for the Company's investment in Guaranteed Rate Affinity, LLC ("Guaranteed Rate Affinity"). The Company's interest in PHH Home Loans, LLC ("PHH Home Loans") was sold to a subsidiary of PHH Corporation in the first quarter of 2018 and the Company received net cash proceeds of $19 million , reducing the investment balance to zero . The $74 million investment balance at December 31, 2017 included $48 million for the Company's investment in Guaranteed Rate Affinity and $19 million for the Company's investment in PHH Home Loans. For the first quarter of 2018, the Company recorded equity losses of $4 million at the Title and Settlement Services segment primarily related to costs associated with the ramp up of operations of Guaranteed Rate Affinity, including $2 million of amortization of intangible assets recorded in purchase accounting. For the first quarter of 2017, the Company recorded equity losses of $3 million primarily related to its investment in PHH Home Loans. The Company received $1 million of cash dividends during both the three months ended March 31, 2018 and 2017 . The Company invested an additional $4 million into Guaranteed Rate Affinity during the three months ended March 31, 2018 . Income Taxes The Company's provision for income taxes in interim periods is computed by applying its estimated annual effective tax rate against the income before income taxes for the period. In addition, non-recurring or discrete items are recorded in the period in which they occur. The provision for income taxes was a benefit of $19 million and $9 million for the three months ended March 31, 2018 and 2017 , respectively. There were no changes to the net benefit recorded during the year ended December 31, 2017 relating to the 2017 Tax Act which was a provisional amount that reflected the Company’s reasonable estimate at the time. Derivative Instruments The Company records derivatives and hedging activities on the balance sheet at their respective fair values. The Company uses foreign currency forward contracts largely to manage its exposure to changes in foreign currency exchange rates associated with its foreign currency denominated receivables and payables. The Company primarily manages its foreign currency exposure to the Euro, British Pound, Swiss Franc and Canadian Dollar. The Company has not elected to utilize hedge accounting for these forward contracts; therefore, any change in fair value is recorded in the Condensed Consolidated Statements of Operations. However, the fluctuations in the value of these forward contracts generally offset the impact of changes in the value of the underlying risk that they are intended to economically hedge. As of March 31, 2018 , the Company had outstanding foreign currency forward contracts in an asset position with a fair value of $1 million and a notional value of $26 million . As of December 31, 2017 , the Company had outstanding foreign currency forward contracts in a liability position with a fair value of less than $1 million and a notional value of $25 million . The Company also enters into interest rate swaps to manage its exposure to changes in interest rates associated with its variable rate borrowings. Interest rate swaps with a notional value of $425 million expired February 10, 2018. As of March 31, 2018 , the Company had interest rate swaps with an aggregate notional value of $1,050 million to offset the variability in cash flows resulting from the term loan facilities as follows: Notional Value (in millions) Commencement Date Expiration Date $600 August 2015 August 2020 $450 November 2017 November 2022 The swaps help to protect our outstanding variable rate borrowings from future interest rate volatility. The Company has not elected to utilize hedge accounting for these interest rate swaps; therefore, any change in fair value is recorded in the Condensed Consolidated Statements of Operations. The fair value of derivative instruments was as follows: Not Designated as Hedging Instruments Balance Sheet Location March 31, 2018 December 31, 2017 Interest rate swap contracts Other non-current assets $ 9 $ — Other current and non-current liabilities 6 13 The effect of derivative instruments on earnings was as follows: Derivative Instruments Not Designated as Hedging Instruments Location of Gain Recognized for Derivative Instruments Gain Recognized on Derivatives Three Months Ended March 31, 2018 2017 Interest rate swap contracts Interest expense $ (12 ) $ (1 ) Restricted Cash Restricted cash primarily relates to amounts specifically designated as collateral for the repayment of outstanding borrowings under the Company’s securitization facilities. Such amounts approximated $6 million and $7 million at March 31, 2018 and December 31, 2017 , respectively. Supplemental Cash Flow Information Significant non-cash transactions during the three months ended March 31, 2018 and 2017 included capital lease additions of $4 million and $5 million , respectively, which resulted in non-cash additions to property and equipment, net and other non-current liabilities. Stock-Based Compensation During the three months ended March 31, 2018 , the Company granted 0.4 million shares of non-qualified stock options for a weighted exercise price of $25.35 and 1.1 million shares of restricted stock units ("RSUs") at a weighted average grant date fair value of $25.45 . Effective March 1, 2018, the Board approved, subject to stockholder approval at the 2018 Annual Meeting, the Realogy Holdings Corp. 2018 Long-Term Incentive Plan, as amended (the "2018 LTIP"). Options and RSUs included in the 2018 LTIP were granted on March 1, 2018. In addition to these awards, RSUs and PSUs aggregating 0.8 million shares were also awarded on March 1, 2018, but the grant was subject to approval of the 2018 LTIP at the 2018 Annual Meeting of Stockholders held on May 2, 2018. The stockholders approved the 2018 LTIP at the May 2, 2018 Annual Meeting and the Company will accordingly treat May 2, 2018 as the grant date for these awards and expense those awards from that date over the balance of the vesting or performance period. Stock Repurchases The Company may repurchase shares of its common stock under authorizations made from its Board of Directors. Shares repurchased are retired and not displayed separately as treasury stock on the consolidated financial statements. The par value of the shares repurchased and retired is deducted from common stock and the excess of the purchase price over par value is first charged against any available additional paid-in capital with the balance charged to retained earnings. Direct costs incurred to repurchase the shares are included in the total cost of the shares. The Company's Board of Directors authorized a share repurchase program of up to $275 million , $300 million and $350 million of the Company's common stock in February 2016, 2017 and 2018, respectively. As of March 31, 2018 , the Company had repurchased and retired 20.2 million shares of common stock for an aggregate of $275 million under the February 2016 share repurchase program and $299 million under the February 2017 share repurchase program at a total weighted average market price of $28.36 per share, including 3.7 million shares of common stock repurchased during the first quarter of 2018 for $99 million at a weighted average market price of $26.58 per share. As of March 31, 2018 , $351 million remained available for repurchase under the share repurchase programs. Dividend Policy In August 2016, the Company’s Board of Directors approved the initiation of a quarterly cash dividend policy of $0.09 per share on its common stock. The Board declared and paid a quarterly cash dividend of $0.09 per share of the Company’s common stock during the first quarter of 2018 . The declaration and payment of any future dividend will be subject to the discretion of the Board of Directors and will depend on a variety of factors, including the Company’s financial condition and results of operations, contractual restrictions, including restrictive covenants contained in the Company’s credit agreements, and the indentures governing the Company’s outstanding debt securities, capital requirements and other factors that the Board of Directors deems relevant. Pursuant to the Company’s policy, the dividends payable in cash are treated as a reduction of additional paid-in capital since the Company is currently in a retained deficit position. Recently Adopted Accounting Pronouncements In May 2014, the FASB issued Accounting Standards Update No. 2014-09 (Topic 606) " Revenue from Contracts with Customers " (the "new revenue standard"). The objective of the new revenue standard is to provide a single, comprehensive revenue recognition model for all contracts with customers to improve comparability within industries, across industries, and across capital markets. The new revenue standard contains principles that an entity will apply to determine the measurement of revenue and the timing of revenue recognition. The Company rewrote its current revenue recognition accounting policies based on the five-step model provided in the new revenue standard, assessed the redesign of internal controls, as well as evaluated the expanded disclosure requirements. After a review of the Company's revenue streams, the Company determined that the new revenue standard did not have a material impact on financial results as the majority of the Company's revenue is recognized at the completion of a homesale transaction which did not result in a change in the timing of recognition of revenue transactions under the new revenue standard. The Company adopted the new revenue standard on January 1, 2018 using the modified retrospective transition method in which the cumulative effect of applying the new revenue standard was recognized as an adjustment to the opening balance of retained earnings. See Note 2, "Revenue Recognition" for further details. In February 2018, the FASB issued a new standard which permits companies to reclassify certain income tax effects resulting from the 2017 Tax Act, called "stranded tax effects", from accumulated other comprehensive income ("AOCI") to retained earnings. According to the new guidance, the reclassification amount should include the effect of the change in the U.S. federal corporate income tax rate on the gross deferred tax amounts and related valuation allowances, if any, at the date of enactment of the 2017 Tax Act related to items remaining in AOCI. The guidance is effective for all companies for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years, with early adoption is permitted. The Company early adopted this standard in the first quarter of 2018 which resulted in a debit to Accumulated other comprehensive loss and a credit to Accumulated deficit for $9 million . The Company’s accounting policy for releasing income tax effects from AOCI is to release those effects when our entire portfolio of the type of item is liquidated. Recently Issued Accounting Pronouncements The Company considers the applicability and impact of all Accounting Standards Updates. ASUs not listed below were assessed and determined to be either not applicable or are expected to have minimal impact on our consolidated financial position or results of operations. In February 2016, the FASB issued its new standard on leases which requires virtually all leases to be recognized on the balance sheet. Lessees will recognize a right-of-use asset and a lease liability for all leases (other than leases that meet the definition of a short-term lease). The liability will be equal to the present value of lease payments. The asset will be based on the liability, subject to adjustment, such as for initial direct costs. For income statement purposes, the FASB retained a dual model, requiring leases to be classified as either operating or finance leases. Operating leases will result in straight-line expense, similar to current operating leases, while finance leases will result in a front-loaded expense pattern, similar to current capital leases. Classification will be based on criteria that are largely similar to those applied in current lease accounting, but without explicit bright lines. The new standard is effective for annual periods beginning after December 15, 2018. Early adoption is permitted. The new leasing standard requires modified retrospective transition, which requires application of the new guidance at the beginning of the earliest comparative period presented in the year of adoption. In January 2018, the FASB issued a proposed ASU that would allow entities to elect a simplified transition approach which would require applying the provisions of the new guidance at the effective date (e.g., January 1, 2019) as opposed to the earliest period presented under the modified retrospective approach (January 1, 2017). While the Company is still evaluating the impact of the standard on its consolidated financial statements, it does expect that the right to use asset and lease liability recorded on its Consolidated Balance Sheets will be material. The Company disclosed its future lease obligations in Note 13. "Commitments and Contingencies" of the Annual Report on Form 10-K for the year ended December 31, 2017 . The Company is in the process of evaluating its policies and internal controls as well as implementing a new lease management system which will be utilized to account for leases under the new guidance once adopted. |
Revenue Recognition Revenue Rec
Revenue Recognition Revenue Recognition | 3 Months Ended |
Mar. 31, 2018 | |
Revenue Recognition [Abstract] | |
Revenue from Contract with Customer [Text Block] | 2. REVENUE RECOGNITION Adoption of the New Revenue Standard Effective January 1, 2018, the Company adopted the new revenue standard using the modified retrospective method. Results for reporting periods beginning after January 1, 2018 are presented under the new revenue standard; however, the comparative prior period amounts have not been restated and continue to be reported in accordance with historic accounting under ASC Topic 605. The majority of the Company's revenue continues to be recognized at the completion of a homesale transaction under the new revenue standard, however as a result of the adoption the Company recognized additional contract liabilities and deferred assets associated with certain other revenue streams. As of January 1, 2018, the Company recorded a net debit to its opening Accumulated deficit of $22 million , net of tax, due to the cumulative impact of adopting the new revenue standard, with the impact primarily related to the recognition of additional contract liabilities for initial area development fees and deferred assets for prepaid commissions. Contract Liabilities for Initial Area Development Fees ("ADF"): Contract liabilities are recorded when cash payments are received or due in advance of the Company's performance. The Company records these as deferred revenues and are classified as current or non-current liabilities in the Condensed Consolidated Balance Sheets based on the expected timing of revenue recognition. The Real Estate Franchise Services segment collects an initial ADF for international territory transactions, which are recorded as deferred revenue when received and recognized into revenue over the term of the agreement, typically 25 years, as consideration for the right to access and benefit from Realogy’s brands. ADFs were recognized as revenue upfront when received under historical guidance. Prepaid Commissions: The incremental direct costs of obtaining a contract, which primarily consist of franchise sales commissions, are deferred and amortized generally over the estimated life of the customer relationship for domestic and international contracts. The Company classifies prepaid commissions as current or non-current assets in the Condensed Consolidated Balance Sheets based on the expected timing of recognizing expense. The Real Estate Franchise Services segment recognizes a deferred asset for commissions paid to Realogy franchise sales employees upon the sale of a new franchise. The amount of commissions is calculated as a percentage of the anticipated gross commission income of the new franchisee or the amount of the ADF and is amortized over the estimated life of franchise customer relationships, 30 years for domestic franchise agreements, or the agreement term for international franchise agreements which is generally 25 years. Franchise sales commissions were expensed upfront when paid under historical guidance. Practical Expedients and Exemptions: The Company elected to apply the practical expedient that only requires the Company to apply the revenue standard to contracts that were open as of the beginning of the earliest period presented which impacted the amount of prepaid commissions capitalized. The majority of the Company's contracts are transactional in nature or have a duration of one-year or less. Accordingly, the Company does not disclose the value of unsatisfied performance obligations for contracts with an original expected length of one year or less. The cumulative effect of the changes made to the Condensed Consolidated Balance Sheets for the adoption of the new revenue standard were as follows: Balance Sheet accounts prior to the new revenue standard adoption adjustments Adjustments due to the adoption of the new revenue standard Balance Sheet accounts after the new revenue standard adoption adjustments ASSETS Current assets: Trade receivables $ 153 $ 1 $ 154 Other current assets 179 2 181 Total current assets 789 3 792 Other non-current assets 222 23 245 Total assets $ 7,337 $ 26 $ 7,363 LIABILITIES AND EQUITY Current liabilities: Accrued expenses and other current liabilities $ 478 $ 2 $ 480 Total current liabilities 955 2 957 Deferred income taxes 327 (8 ) 319 Other non-current liabilities 212 54 266 Total liabilities 4,715 48 4,763 Equity: Accumulated deficit (a) (2,622 ) (22 ) (2,644 ) Accumulated other comprehensive loss (a) (46 ) — (46 ) Total stockholders' equity 2,618 (22 ) 2,596 Total equity 2,622 (22 ) 2,600 Total liabilities and equity $ 7,337 $ 26 $ 7,363 _______________ (a) Beginning balances have been adjusted for the adoption of the accounting standard update on stranded tax effects related to the 2017 Tax Act which resulted in a debit to Accumulated other comprehensive loss and a credit to Accumulated deficit of $9 million . See Note 1, "Basis of Presentation" in the "Recently Adopted Accounting Pronouncements" section for additional information. The impact of adopting the new revenue standard, as compared to historic guidance under ASC Topic 605, was immaterial to the Company's Condensed Consolidated Financial Statements as of and for the period ended March 31, 2018. Revenue Recognition Revenue is recognized upon the transfer of control of promised services to customers in an amount that reflects the consideration the Company expects to receive in exchange for those services in accordance with the new revenue standard. The Company's revenue is disaggregated by major revenue categories on our Condensed Consolidated Statements of Operations and further disaggregated by business segment as follows: Three Months Ended March 31, 2018 Real Estate Company Relocation Title and Corporate and Other Total Gross commission income (a) $ — $ 902 $ — $ — $ — $ 902 Service revenue (b) — 2 78 117 — 197 Franchise fees (c) 139 — — — (60 ) 79 Other (d) 37 13 1 3 (3 ) 51 Net revenues $ 176 $ 917 $ 79 $ 120 $ (63 ) $ 1,229 Three Months Ended March 31, 2017 (e) Real Estate Company Relocation Title and Corporate and Other Total Gross commission income (a) $ — $ 881 $ — $ — $ — $ 881 Service revenue (b) — 2 76 116 — 194 Franchise fees (c) 134 — — — (59 ) 75 Other (d) 36 14 1 4 (2 ) 53 Net revenues $ 170 $ 897 $ 77 $ 120 $ (61 ) $ 1,203 _______________ (a) During both the three months ended March 31, 2018 and March 31, 2017, approximately 74% of the Company's total net revenues, related to gross commission income at the Company Owned Brokerage Services segment which is recognized at a point in time at the closing of a homesale transaction. (b) During both the three months ended March 31, 2018 and March 31, 2017, approximately 16% of the Company's total net revenues related to service fees primarily consisting of title and escrow fees at the Title and Settlement Services segment ( 10% ), which are recognized at a point in time at the closing of a homesale transaction, and relocation fees at the Relocation Services segment ( 6% ), which are recognized as revenue when or as the related performance obligation is satisfied, which is dependent on the type of service performed. Relocation fees at the Relocation Services segment primarily include: (i) referral fees which are recognized at a point in time at the closing of a homesale transaction, (ii) outsourcing fees, which are management fees charged to clients frequently related to a bundle of relocation services performed and are recognized over the average time period to complete a move, and (iii) referral commissions from third party suppliers which are recognized at the time of the completion of the related service. (c) During both the three months ended March 31, 2018 and March 31, 2017, approximately 6% of the Company's total net revenues related to franchise fees at the Real Estate Franchise Services segment, primarily domestic royalties, which are recognized at a point in time when the underlying franchisee revenue is earned (upon close of the homesale transaction). (d) During both the three months ended March 31, 2018 and March 31, 2017, approximately 4% of the Company's total net revenues related to other revenue which comprised of brand marketing funds received at the Real Estate Franchise Services segment from franchisees and other miscellaneous revenues across all of the business segments. (e) Prior period amounts have not been adjusted under the modified retrospective method. The Company's revenue streams are discussed further below by business segment: Real Estate Franchise Services The Company franchises its real estate brands to real estate brokerage businesses that are independently owned and operated. Franchise revenue principally consists of royalty and marketing fees from the Company’s franchisees. The royalty received is primarily based on a percentage of the franchisee’s gross commission income. Royalty fees are accrued as the underlying franchisee revenue is earned (upon close of the homesale transaction). Annual volume incentives given to certain franchisees on royalty fees are recorded as a reduction to revenue and are accrued for in relative proportion to the recognition of the underlying gross franchise revenue. Non-standard sales incentives are recorded as a reduction to revenue ratably over the related performance period or from the date of issuance through the remaining life of the related franchise agreement. Franchise revenue also includes initial franchise fees which are generally non-refundable and recognized by the Company as revenue upon the execution or opening of a new franchisee office to cover the upfront costs associated with opening the franchisee for business under one of Realogy’s brands. The Company also earns marketing fees from its franchisees and utilizes such fees to fund marketing campaigns on behalf of its franchisees. As such, brand marketing fund fees are recorded as deferred revenue when received and recognized into revenue as earned when these funds are spent on marketing activities. The balance for deferred brand marketing fund fees decreased from $13 million at January 1, 2018 to $9 million at March 31, 2018 primarily due to amounts recognized into revenue matching expenses for marketing activities partially offset by additional fees received from franchisees during the first quarter of 2018. The Company collects initial ADFs for international territory transactions, which are recorded as deferred revenue when received and recognized into revenue over the average 25 year life of the related franchise agreement as consideration for the right to access and benefit from Realogy’s brands. The balance for deferred ADFs decreased from $58 million at January 1, 2018 to $57 million at March 31, 2018 due to revenues recognized during the first quarter of 2018 that were included in the deferred revenue balance at the beginning of the period. There were no additional initial area development fees received during the three months ended March 31, 2018. The Real Estate Franchise Services segment records deferred income related to various other revenue contracts. The balance of other deferred income increased from $8 million at January 1, 2018 to $9 million at March 31, 2018 as a result of cash payments received or due during the first quarter of 2018 partially offset by revenues recognized as the performance obligations were satisfied. In addition, the Company recognizes a deferred asset for commissions paid to Realogy franchise sales employees upon the sale of a new franchise as these are considered costs of obtaining a contract with a customer that are expected to provide benefits to the Company for longer than one year. The amount of commissions is calculated as a percentage of the anticipated gross commission income of the new franchisee or ADF and is amortized over 30 years for domestic franchise agreements or the agreement term for international franchise agreements (generally 25 years). Company Owned Real Estate Brokerage Services As an owner-operator of real estate brokerages, the Company assists home buyers and sellers in listing, marketing, selling and finding homes. Real estate commissions earned by the Company’s real estate brokerage business are recorded as revenue at a point in time which is upon the closing of a real estate transaction (i.e., purchase or sale of a home). These revenues are referred to as gross commission income. The commissions the Company pays to real estate agents are recognized concurrently with associated revenues and presented as the commission and other agent-related costs line item on the accompanying Condensed Consolidated Statements of Operations. The Company has relationships with developers, primarily in major cities, to provide marketing and brokerage services in new developments. New development closings generally have a development period of between 18 and 24 months from contracted date to closing. In some cases, the Company receives advanced commissions which are recorded as deferred revenue when received and recognized as revenue when the new development closes. The balance of advanced commissions related to developments at January 1, 2018 was a liability of $10 million which increased $2 million related to additional commissions received for new developments and decreased $2 million due to revenues recognized on units closed during the three months ended March 31, 2018. The balance of advance commissions related to developments was $10 million at March 31, 2018. Relocation Services The Company provides relocation services to corporate and government clients for the transfer of their employees ("transferees"). Such services include homesale assistance including the purchasing and/or selling of a transferee’s home and providing home equity advances to transferees (generally guaranteed by the individual's employer), arranging household goods moving services, and other relocation services such as expense processing, relocation policy counseling, relocation-related accounting, coordinating visa and immigration support, intercultural and language training and destination services. In the majority of relocation transactions, the gain or loss on the sale of a transferee’s home is generally borne by the individual's employer. C lients may pay an outsourcing management fee that can cover several of the relocation services listed above, according to the clients' specific needs. In addition, the Company provides home buying and selling assistance to members of Affinity organizations. The Company earns referral commission revenue primarily from real estate brokers for the home sale and purchase of transferees a nd Affinity members, which is recognized at a point in time when the underlying property closes, and revenues from other third-party service providers where the Company earns a referral commission, which is recognized at the point in time at the completion of services. Furthermore, the Company generally earns interest income on the funds it advances on behalf of the transferring employee, which is recorded within other revenue (as is the corresponding interest expense on the securitization obligations) in the accompanying Condensed Consolidated Statements of Operations. The Company earns revenues from outsourcing management fees charged to clients for the performance and facilitation of relocation services. Outsourcing management fees are recorded as deferred revenue when billed (usually at the start of the relocation) and are recognized as revenue over the average time period required to complete the transferee's move, or a phase of the move that the fee covers, which is typically 3 to 6 months depending on the move type. The balance for outsourcing management fees increased from $5 million on January 1, 2018 to $6 million on March 31, 2018. The increase was primarily due to additions of $13 million during the first quarter of 2018 primarily related to new management fees billed on new relocation files in the first quarter of 2018, in advance of the Company satisfying its performance obligation, partially offset by a $12 million decrease as a result of revenues recognized during the first quarter of 2018 as the performance obligations were satisfied. The Relocation Services segment manages the Cartus Broker Network, which is a network of real estate brokers consisting of our company owned brokerage operations, select franchisees and independent real estate brokers who have been approved to become members. Network fees are billed in the fourth quarter of the previous year for the following year's membership and recognized into revenue on a straight-line basis each month during the membership period. The balance for Cartus Broker Membership decreased from $8 million at January 1, 2018 to $6 million at March 31, 2018 primarily due to $3 million of revenues recognized during the first quarter of 2018 that were included in the deferred revenue balance at the beginning of the period. Title and Settlement Services The Company provides title and closing services, which include title search procedures for title insurance policies, homesale escrow and other closing services. Title revenues, which are recorded net of amounts remitted to third-party insurance underwriters, and title and closing service fees are recorded at a point in time which occurs at the time a homesale transaction or refinancing closes. The Company also owns an underwriter of title insurance. For independent title agents, the underwriter recognizes policy premium revenue on a gross basis (before deduction of agent commission) upon notice of policy issuance from the agent. For affiliated title agents, the underwriter recognizes the incremental policy premium revenue upon the effective date of the title policy as the agent commission revenue is already recognized by the affiliated title agent. Contract Balances (Deferred Revenue) The following table shows the change in the Company's contract liabilities related to revenue contracts by reportable segment for the period: Three Months Ended March 31, 2018 Beginning Balance at January 1, 2018 Additions during the period Recognized as Revenue during the period Ending Balance at March 31, 2018 Real Estate Franchise Services (a) $ 79 $ 30 $ (34 ) $ 75 Company Owned Real Estate Brokerage Services 17 3 (4 ) 16 Relocation Services 18 19 (19 ) 18 Total $ 114 $ 52 $ (57 ) $ 109 _______________ (a) Revenues recognized include intercompany marketing fees paid by the Company Owned Real Estate Brokerage Services segment. |
Intangible Assets
Intangible Assets | 3 Months Ended |
Mar. 31, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets | INTANGIBLE ASSETS Goodwill by segment and changes in the carrying amount are as follows: Real Estate Franchise Services Company Owned Brokerage Services Relocation Services Title and Settlement Services Total Company Gross goodwill as of December 31, 2017 $ 3,315 $ 1,062 $ 641 $ 478 $ 5,496 Accumulated impairment losses (1,023 ) (158 ) (281 ) (324 ) (1,786 ) Balance at December 31, 2017 2,292 904 360 154 3,710 Goodwill acquired (a) — 1 — — 1 Balance at March 31, 2018 $ 2,292 $ 905 $ 360 $ 154 $ 3,711 _______________ (a) Goodwill acquired during the three months ended March 31, 2018 relates to the acquisition of one real estate brokerage operation. Intangible assets are as follows: As of March 31, 2018 As of December 31, 2017 Gross Carrying Amount Accumulated Amortization Net Carrying Amount Gross Carrying Amount Accumulated Amortization Net Carrying Amount Amortizable—Franchise agreements (a) $ 2,019 $ 742 $ 1,277 $ 2,019 $ 725 $ 1,294 Indefinite life—Trademarks (b) $ 749 $ 749 $ 749 $ 749 Other Intangibles Amortizable—License agreements (c) $ 45 $ 10 $ 35 $ 45 $ 10 $ 35 Amortizable—Customer relationships (d) 549 341 208 549 335 214 Indefinite life—Title plant shares (e) 18 18 18 18 Amortizable—Pendings and listings (f) — — — 2 1 1 Amortizable—Other (g) 33 18 15 33 17 16 Total Other Intangibles $ 645 $ 369 $ 276 $ 647 $ 363 $ 284 _______________ (a) Generally amortized over a period of 30 years. (b) Primarily relates to the Century 21 ® , Coldwell Banker ® , ERA ® , Corcoran ® , Coldwell Banker Commercial ® and Cartus tradenames, which are expected to generate future cash flows for an indefinite period of time. (c) Relates to the Sotheby’s International Realty ® and Better Homes and Gardens ® Real Estate agreements which are being amortized over 50 years (the contractual term of the license agreements). (d) Relates to the customer relationships at the Relocation Services segment, the Title and Settlement Services segment and our Company Owned Real Estate Brokerage Services segment. These relationships are being amortized over a period of 2 to 20 years. (e) Ownership in a title plant is required to transact title insurance in certain states. The Company expects to generate future cash flows for an indefinite period of time. (f) Generally amortized over a period of 5 months . (g) Consists of covenants not to compete which are amortized over their contract lives and other intangibles which are generally amortized over periods ranging from 5 to 10 years. Intangible asset amortization expense is as follows: Three Months Ended March 31, 2018 2017 Franchise agreements $ 17 $ 17 License agreements — — Customer relationships 6 6 Pendings and listings 1 1 Other 1 2 Total $ 25 $ 26 Based on the Company’s amortizable intangible assets as of March 31, 2018 , the Company expects related amortization expense for the remainder of 2018 , the four succeeding years and thereafter to be approximately $73 million , $97 million , $95 million , $93 million , $92 million and $1,085 million , respectively. |
Accrued Expenses And Other Curr
Accrued Expenses And Other Current Liabilities | 3 Months Ended |
Mar. 31, 2018 | |
Payables and Accruals [Abstract] | |
Accrued Expenses And Other Current Liabilities | ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES Accrued expenses and other current liabilities consisted of: March 31, 2018 December 31, 2017 Accrued payroll and related employee costs $ 86 $ 140 Accrued volume incentives 30 41 Accrued commissions 34 38 Restructuring accruals 12 5 Deferred income 65 68 Accrued interest 35 13 Contingent consideration for acquisitions 26 26 Due to former parent 18 18 Other 120 129 Total accrued expenses and other current liabilities $ 426 $ 478 |
Short And Long Term-Debt
Short And Long Term-Debt | 3 Months Ended |
Mar. 31, 2018 | |
Debt Disclosure [Abstract] | |
Short And Long-Term Debt | SHORT AND LONG-TERM DEBT Total indebtedness is as follows: March 31, 2018 December 31, 2017 Senior Secured Credit Facility: Revolving Credit Facility $ 302 $ 70 Term Loan B (1) 1,060 1,063 Term Loan A Facility: Term Loan A (1) 745 390 Term Loan A-1 — 339 4.50% Senior Notes 445 444 5.25% Senior Notes 546 546 4.875% Senior Notes 497 496 Total Short-Term & Long-Term Debt $ 3,595 $ 3,348 Securitization Obligations: Apple Ridge Funding LLC $ 170 $ 181 Cartus Financing Limited 14 13 Total Securitization Obligations $ 184 $ 194 _______________ (1) As of March 31, 2018 , after giving effect to the February 2018 refinancing transactions discussed in this Note 5 under the headings "Senior Secured Credit Facility" and "Term Loan A Facility." Indebtedness Table As of March 31, 2018 , the Company’s borrowing arrangements were as follows: Interest Expiration Principal Amount Unamortized Discount and Debt Issuance Costs Net Amount Senior Secured Credit Facility: Revolving Credit Facility (1) (2) February 2023 $ 302 $ * $ 302 Term Loan B (3) February 2025 1,077 17 1,060 Term Loan A Facility: Term Loan A (4) February 2023 750 5 745 Senior Notes 4.50% April 2019 450 5 445 Senior Notes 5.25% December 2021 550 4 546 Senior Notes 4.875% June 2023 500 3 497 Securitization obligations: (5) Apple Ridge Funding LLC (6) June 2018 170 * 170 Cartus Financing Limited (7) August 2018 14 * 14 Total (8) $ 3,813 $ 34 $ 3,779 _______________ * The debt issuance costs related to our Revolving Credit Facility and securitization obligations are classified as a deferred financing asset within other assets. (1) As of March 31, 2018 , the Company had $1,400 million of borrowing capacity under its Revolving Credit Facility, leaving $1,098 million of available capacity. The Revolving Credit Facility expires in February 2023 , but is classified on the balance sheet as current due to the revolving nature of the facility. On May 1, 2018 , the Company had $372 million in outstanding borrowings under the Revolving Credit Facility, leaving $1,028 million of available capacity. (2) Interest rates with respect to revolving loans under the Senior Secured Credit Facility at March 31, 2018 were based on, at the Company's option, (a) adjusted London Interbank Offering Rate (" LIBOR ") plus an additional margin or (b) JP Morgan Chase Bank, N.A.'s prime rate (" ABR ") plus an additional margin, in each case subject to adjustment based on the then current senior secured leverage ratio. Based on the previous quarter senior secured leverage ratio, the LIBOR margin was 2.00% and the ABR margin was 1.00% for the three months ended March 31, 2018 . (3) The Term Loan B provides for quarterly amortization payments totaling 1% per annum of the original principal amount. The interest rate with respect to term loans under the Term Loan B is based on, at the Company’s option, (a) adjusted LIBOR plus 2.25% (with a LIBOR floor of 0.75% ) or (b) ABR plus 1.25% (with an ABR floor of 1.75% ). (4) The Term Loan A provides for quarterly amortization payments, which commence on June 30, 2018, totaling per annum 2.5% , 2.5% , 5.0% , 7.5% and 10.0% of the original principal amount of the Term Loan A, with the last amortization payment to be made on February 8, 2023. The interest rates with respect to term loans under the Term Loan A are based on, at the Company's option, (a) adjusted LIBOR plus an additional margin or (b) ABR plus an additional margin, in each case subject to adjustment based on the then current senior secured leverage ratio. Based on the previous quarter senior secured leverage ratio, the LIBOR margin was 2.00% and the ABR margin was 1.00% for the three months ended March 31, 2018 . (5) Available capacity is subject to maintaining sufficient relocation related assets to collateralize these securitization obligations. (6) As of March 31, 2018 , the Company had $250 million of borrowing capacity under the Apple Ridge Funding LLC securitization program leaving $80 million of available capacity. (7) Consists of a £10 million revolving loan facility and a £5 million working capital facility. As of March 31, 2018 , the Company had $21 million of borrowing capacity under the Cartus Financing Limited securitization program leaving $7 million of available capacity. (8) Not included in this table is the Company's Unsecured Letter of Credit Facility which had a capacity of $74 million with $66 million utilized at a weighted average rate of 3.24% at March 31, 2018 . Maturities Table As of March 31, 2018 , the combined aggregate amount of maturities for long-term borrowings, excluding securitization obligations, for the remainder of 2018 and each of the next four years is as follows: Year Amount Remaining 2018 (a) $ 324 2019 480 2020 44 2021 613 2022 81 _______________ (a) The current portion of long-term debt consists of remaining 2018 amortization payments totaling $14 million and $8 million for the Term Loan A and Term Loan B facilities, respectively, as well as $302 million of revolver borrowings under the Revolving Credit Facility which expires in February 2023 , but are classified on the balance sheet as current due to the revolving nature of the facility. Senior Secured Credit Facility In February 2018, the Company entered into fifth and sixth amendments to the Amended and Restated Senior Secured Credit Agreement dated as of March 5, 2013 (as amended, amended and restated, modified or supplemented from time to time, the "Senior Secured Credit Agreement") that respectively (i) replaced the approximately $1,100 million Term Loan B due July 2022 with a new $1,080 million Term Loan B due February 2025 and (ii) increased the borrowing capacity under its Revolving Credit Facility to $1,400 million from the prior $1,050 million and extended the maturity date to February 2023 from October 2020. The Senior Secured Credit Agreement provides for: (a) the Term Loan B issued in the original aggregate principal amount of $1,080 million with a maturity date of February 2025. The Term Loan B has quarterly amortization payments totaling 1% per annum of the initial aggregate principal amount. The interest rate with respect to term loans under the Term Loan B is based on, at Realogy Group's option, adjusted LIBOR plus 2.25% (with a LIBOR floor of 0.75% ) or ABR plus 1.25% (with an ABR floor of 1.75% ); and (b) a $1,400 million Revolving Credit Facility with a maturity date of February 2023, which includes a $125 million letter of credit subfacility. The interest rate with respect to revolving loans under the Revolving Credit Facility is based on, at Realogy Group's option, adjusted LIBOR or ABR plus an additional margin subject to the following adjustments based on the Company’s then current senior secured leverage ratio: Senior Secured Leverage Ratio Applicable LIBOR Margin Applicable ABR Margin Greater than 3.50 to 1.00 2.50% 1.50% Less than or equal to 3.50 to 1.00 but greater than or equal to 2.50 to 1.00 2.25% 1.25% Less than 2.50 to 1.00 but greater than or equal to 2.00 to 1.00 2.00% 1.00% Less than 2.00 to 1.00 1.75% 0.75% The Senior Secured Credit Agreement permits the Company to obtain up to $500 million of additional credit facilities from lenders reasonably satisfactory to the administrative agent and us, without the consent of the existing lenders under the new senior secured credit facility, plus an unlimited amount if Realogy Group's senior secured leverage ratio is less than 3.50 to 1.00 on a pro forma basis. Subject to certain restrictions, the Senior Secured Credit Agreement also permits us to issue senior secured or unsecured notes in lieu of any incremental facility. The obligations under the Senior Secured Credit Agreement are secured to the extent legally permissible by substantially all of the assets of Realogy Group, Realogy Intermediate and all of their domestic subsidiaries, other than certain excluded subsidiaries. Realogy Group’s Senior Secured Credit Agreement contains financial, affirmative and negative covenants and requires Realogy Group to maintain (so long as the Revolving Credit Facility is outstanding) a senior secured leverage ratio, not to exceed 4.75 to 1.00 . The leverage ratio is tested quarterly regardless of the amount of borrowings outstanding and letters of credit issued under the revolver at the testing date. Total senior secured net debt does not include unsecured indebtedness, including the Unsecured Notes as well as the securitization obligations. At March 31, 2018 , Realogy Group was in compliance with the senior secured leverage ratio covenant. Term Loan A Facility In February 2018, Realogy Group entered into a second amendment to the Term Loan A senior secured credit agreement. Under the amendment, the Company aggregated the existing $435 million Term Loan A and $355 million Term Loan A-1 tranches due October 2020 and July 2021, respectively, into a new single tranche of $750 million Term Loan A due February 2023. The Term Loan A provides for quarterly amortization payments totaling per annum 2.5% , 2.5% , 5.0% , 7.5% and 10.0% of the original principal amount of the Term Loan A, which commence on June 30, 2018 and continue through February 8, 2023. The interest rates with respect to the Term Loan A are based on, at our option, adjusted LIBOR or ABR plus an additional margin subject to the following adjustments based on the Company’s then current senior secured leverage ratio: Senior Secured Leverage Ratio Applicable LIBOR Margin Applicable ABR Margin Greater than 3.50 to 1.00 2.50% 1.50% Less than or equal to 3.50 to 1.00 but greater than or equal to 2.50 to 1.00 2.25% 1.25% Less than 2.50 to 1.00 but greater than or equal to 2.00 to 1.00 2.00% 1.00% Less than 2.00 to 1.00 1.75% 0.75% Consistent with the Senior Secured Credit Agreement, the Term Loan A Facility permits the Company to obtain up to $500 million of additional credit facilities from lenders reasonably satisfactory to the administrative agent and the company, without the consent of the existing lenders under the Term Loan A, plus an unlimited amount if the Company's senior secured leverage ratio is less than 3.50 to 1.00 on a pro forma basis. Subject to certain restrictions, the Term Loan A Facility also permits us to issue senior secured or unsecured notes in lieu of any incremental facility. Unsecured Notes The 4.50% Senior Notes, 5.25% Senior Notes and 4.875% Senior Notes (collectively the "Unsecured Notes") are unsecured senior obligations of Realogy Group that mature on April 15, 2019, December 1, 2021 and June 1, 2023, respectively. Interest on the Unsecured Notes is payable each year semiannually on April 15 and October 15 for the 4.50% Senior Notes and June 1 and December 1 for both the 5.25% Senior Notes and 4.875% Senior Notes. The Unsecured Notes are guaranteed on an unsecured senior basis by each domestic subsidiary of Realogy Group that is a guarantor under the Senior Secured Credit Facility and Realogy Group's outstanding debt securities and are guaranteed by Realogy Holdings on an unsecured senior subordinated basis. The indentures governing the Unsecured Notes contain affirmative and negative covenants of Realogy Group and the subsidiary guarantors. Other Debt Facilities The Company has an Unsecured Letter of Credit Facility to provide for the issuance of letters of credit required for general corporate purposes by the Company. At March 31, 2018 , the capacity of the facility was $74 million with $66 million being utilized and at December 31, 2017 , the capacity of the facility was $74 million with $69 million being utilized. The facility's expiration dates are as follows: Capacity (in millions) Expiration Date $8 September 2018 $66 December 2019 The fixed pricing to the Company is based on a spread above the credit default swap rate for senior unsecured debt obligations of the Company over the applicable letter of credit period. Realogy Group's obligations under the Unsecured Letter of Credit Facility are guaranteed on an unsecured senior basis by each domestic subsidiary of Realogy Group that is a guarantor under the Senior Secured Credit Facility and Realogy Group's outstanding debt securities. Securitization Obligations Realogy Group has secured obligations through Apple Ridge Funding LLC under a securitization program. The program expires in June 2018 and has a capacity of $250 million . At March 31, 2018 , Realogy Group had $170 million of outstanding borrowings under the facility. Realogy Group, through a special purpose entity known as Cartus Financing Limited, has agreements providing for a £10 million revolving loan facility and a £5 million working capital facility, both of which expire in August 2018. There were $14 million of outstanding borrowings on the facilities at March 31, 2018 . These Cartus Financing Limited facilities are secured by the relocation assets of a U.K. government contract in this special purpose entity and are therefore classified as permitted securitization financings as defined in Realogy Group’s Senior Secured Credit Facility and the indentures governing the Unsecured Notes. The Apple Ridge entities and the Cartus Financing Limited entity are consolidated special purpose entities that are utilized to securitize relocation receivables and related assets. These assets are generated from advancing funds on behalf of clients of Realogy Group’s relocation business in order to facilitate the relocation of their employees. Assets of these special purpose entities are not available to pay Realogy Group’s general obligations. Under the Apple Ridge program, provided no termination or amortization event has occurred, any new receivables generated under the designated relocation management agreements are sold into the securitization program and as new eligible relocation management agreements are entered into, the new agreements are designated to the program. The Apple Ridge program has restrictive covenants and trigger events, including performance triggers linked to the age and quality of the underlying assets, foreign obligor limits, multicurrency limits, financial reporting requirements, restrictions on mergers and change of control, any uncured breach of Realogy Group’s senior secured leverage ratio under Realogy Group’s Senior Secured Credit Facility, and cross-defaults to Realogy Group’s material indebtedness. The occurrence of a trigger event under the Apple Ridge securitization facility could restrict our ability to access new or existing funding under this facility or result in termination of the facility, either of which would adversely affect the operation of our relocation business. Certain of the funds that Realogy Group receives from relocation receivables and related assets must be utilized to repay securitization obligations. These obligations were collateralized by $239 million and $218 million of underlying relocation receivables and other related relocation assets at March 31, 2018 and December 31, 2017 , respectively. Substantially all relocation related assets are realized in less than twelve months from the transaction date. Accordingly, all of Realogy Group’s securitization obligations are classified as current in the accompanying Condensed Consolidated Balance Sheets. Interest incurred in connection with borrowings under these facilities amounted to $2 million and $1 million for the three months ended March 31, 2018 and 2017 , respectively. This interest is recorded within net revenues in the accompanying Condensed Consolidated Statements of Operations as related borrowings are utilized to fund Realogy Group's relocation business where interest is generally earned on such assets. These securitization obligations represent floating rate debt for which the average weighted interest rate was 3.6% and 3.3% for the three months ended March 31, 2018 and 2017 , respectively. Loss on the Early Extinguishment of Debt and Write-Off of Financing Costs As a result of the refinancing transactions in February 2018, the Company recorded a loss on the early extinguishment of debt of $7 million and wrote off financing costs of $2 million to interest expense during the three months ended March 31, 2018 . As a result of a refinancing transaction completed in January 2017, the Company recorded a loss on the early extinguishment of debt of $4 million during the three months ended March 31, 2017 . |
Restructuring Costs Restructuri
Restructuring Costs Restructuring Costs | 3 Months Ended |
Mar. 31, 2018 | |
Restructuring and Related Activities [Abstract] | |
Restructuring and Related Activities Disclosure | 6. RESTRUCTURING COSTS Restructuring charges were $30 million and $5 million for the three months ended March 31, 2018 and 2017, respectively. The components of the restructuring charges for the three months ended March 31, 2018 and 2017 were as follows: Three Months Ended March 31, 2018 2017 Personnel-related costs (1) $ 14 $ 5 Facility-related costs (2) 9 — Internal use software impairment (3) 7 — Total restructuring charges $ 30 $ 5 _______________ (1) Personnel-related costs consist of severance costs provided to employees who have been terminated and duplicate payroll costs during transition. (2) Facility-related costs consist of costs associated with planned facility closures such as contract termination costs, lease payments, net of applicable sublease income, that will continue to be incurred under the contract for its remaining term without economic benefit to the Company, accelerated depreciation on asset disposals and other facility and employee relocation related costs. (3) Internal use software impairment relates to development costs capitalized for a project that was determined to not meet the Company's strategic goals when analyzed by the Company's new leadership team. Leadership Realignment and Other Restructuring Activities Beginning in the first quarter of 2018, the Company commenced the implementation of a plan to drive its business forward and enhance stockholder value. The key aspects of this plan include senior leadership realignment, an enhanced focus on technology and talent, as well as further attention on office footprint and other operational efficiencies, including the consolidation of certain support services provided to the Company Owned Real Estate Brokerage Services and Real Estate Franchise Services segments. The following is a reconciliation of the beginning and ending reserve balances for the restructuring program related to Leadership Realignment and Other Restructuring Activities: Personnel-related costs Facility-related costs Internal use software impairment Total Balance at December 31, 2017 $ — $ — $ — $ — Restructuring charges 14 8 7 29 Costs paid or otherwise settled (8 ) (1 ) (7 ) (16 ) Balance at March 31, 2018 $ 6 $ 7 $ — $ 13 The following table shows the total costs currently expected to be incurred by type of cost the restructuring program related to Leadership Realignment and Other Restructuring Activities: Total amount expected to be incurred Amount incurred to date Total amount remaining to be incurred Personnel-related costs $ 17 $ 14 $ 3 Facility-related costs 17 8 9 Internal use software impairment 7 7 — Total $ 41 $ 29 $ 12 The following table shows the total costs currently expected to be incurred by reportable segment for the restructuring program related to Leadership Realignment and Other Restructuring Activities: Total amount expected to be incurred Amount incurred to date Total amount remaining to be incurred Real Estate Franchise Services $ 2 $ 2 $ — Company Owned Real Estate Brokerage Services 27 16 11 Relocation Services 9 8 1 Title and Settlement Services 1 1 — Corporate and Other 2 2 — Total $ 41 $ 29 $ 12 Business Optimization Initiative During the fourth quarter of 2015, the Company began a business optimization initiative that focused on maximizing the efficiency and effectiveness of the cost structure of each of the Company's business units. The action was designed to improve client service levels across each of the business units while enhancing the Company's profitability and incremental margins. The plan focused on several key areas of opportunity which include process improvement efficiencies, office footprint optimization, leveraging technology and media spend, centralized procurement, outsourcing administrative services and organizational design. The expected costs of activities undertaken in connection with the restructuring plan are largely complete. At December 31, 2017, the remaining liability was $7 million . During the three months ended March 31, 2018 , the Company incurred facility-related costs of $1 million and paid or settled costs of $3 million , resulting in a remaining accrual of $5 million . |
Earnings Per Share Earnings Per
Earnings Per Share Earnings Per Share | 3 Months Ended |
Mar. 31, 2018 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | . EARNINGS (LOSS) PER SHARE Earnings (loss) per share attributable to Realogy Holdings Basic earnings per share is computed based on net income attributable to Realogy Holdings stockholders divided by the basic weighted-average shares outstanding during the period. Dilutive earnings per share is computed consistently with the basic computation while giving effect to all dilutive potential common shares and common share equivalents that were outstanding during the period. Realogy Holdings uses the treasury stock method to reflect the potential dilutive effect of unvested stock awards and unexercised options. The Company was in a net loss position for the three months ended March 31, 2018 and 2017 , and therefore the impact of incentive equity awards were excluded from the computation of dilutive loss per share as the inclusion of such amounts would be anti-dilutive. At March 31, 2018 and 2017 , the number of shares of common stock issuable for incentive equity awards, with performance awards based on the achievement of 100% of target amounts, was 7.6 million and 7.3 million , respectively. In the first quarter of 2018 , the Company repurchased and retired 3.7 million shares of common stock for $99 million at a weighted average market price of $26.58 per share. The shares repurchased include 202,860 shares for which the trade date occurred in late March 2018 while settlement occurred in April 2018. The purchase of shares under this plan reduces the weighted-average number of shares outstanding in the basic earnings per share calculation. |
Commitments And Contingencies
Commitments And Contingencies | 3 Months Ended |
Mar. 31, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments And Contingencies | COMMITMENTS AND CONTINGENCIES Litigation The Company is involved in claims, legal proceedings, alternative dispute resolution and governmental inquiries related to alleged contract disputes, business practices, intellectual property and other commercial, employment, regulatory and tax matters. Examples of such matters include but are not limited to allegations: • that the Company is vicariously liable for the acts of franchisees under theories of actual or apparent agency; • by current or former franchisees that franchise agreements were breached including improper terminations; • concerning claims for alleged RESPA or state real estate law violations including but not limited to claims challenging the validity of sales agent indemnification, and administrative fees; • that residential real estate sales agents engaged by NRT—under certain state or federal laws—are potentially employees instead of independent contractors, and they or regulators therefore may bring claims against NRT for breach of contract, wage and hour classification claims, wrongful discharge, unemployment and workers' compensation and could seek benefits, back wages, overtime, indemnification, penalties related to classification practices and expense reimbursement available to employees; • concerning other employment law matters, including wage and hour claims; • concerning claims generally against the company owned brokerage operations for negligence, misrepresentation or breach of fiduciary duty in connection with the performance of real estate brokerage or other professional services as well as other brokerage claims associated with listing information and property history; • related to copyright law, including infringement actions alleging improper use of copyrighted photographs on websites or in marketing materials without consent of the copyright holder; • concerning claims generally against the title company contending that, as the escrow company, the company knew or should have known that a transaction was fraudulent or concerning other title defects or settlement errors; • concerning information security and cyber-crime, including claims related to the diversion of homesale transaction closing funds and/or the protection of the privacy and personally identifiable information of our customers and employees; • concerning anti-trust and anti-competition matters; and • those related to general fraud claims. Real Estate Business Litigation Dodge, et al. v. PHH Corporation, et al., formerly captioned Strader, et al. and Hall v. PHH Corporation, et al. (U.S. District Court for the Central District of California). This is a purported class action brought by four California residents against 15 defendants, including Realogy and certain of its subsidiaries, PHH Corporation and PHH Home Loans, LLC (a joint venture between Realogy and PHH), alleging violations of Section 8(a) of RESPA. On May 19, 2017, the parties held a mediation session, at which they agreed in principle to a settlement of the action, pursuant to which the Company would pay approximately $8 million (or one-half of the settlement). In settling the matter, the Company specifically denied any wrongdoing with respect to the claims asserted in the case. As a result of the settlement, the Company accrued $8 million in the second quarter of 2017 and the liability is included in accrued expenses and other current liabilities on the Condensed Consolidated Balance Sheets. On January 29, 2018, the Court issued an order granting preliminary approval of the settlement, directed class notices to be sent by February 2018 and set the hearing on final approval of the settlement for August 16, 2018. Class notices were sent in February 2018. The Company is involved in certain other claims and legal actions arising in the ordinary course of our business. Such litigation, regulatory actions and other proceedings may include, but are not limited to, actions relating to intellectual property, commercial arrangements, franchising arrangements, actions against our title company alleging it knew or should have known that others were committing mortgage fraud, standard brokerage disputes like the failure to disclose accurate square footage or hidden defects in the property such as mold, vicarious liability based upon conduct of individuals or entities outside of our control, including franchisees and independent sales agents, antitrust and anti-competition claims, general fraud claims, employment law claims, including claims challenging the classification of our sales agents as independent contractors, wage and hour classification claims and claims alleging violations of RESPA or state consumer fraud statutes. While the results of such claims and legal actions cannot be predicted with certainty, we do not believe based on information currently available to us that the final outcome of current proceedings against the Company will have a material adverse effect on our consolidated financial position, results of operations or cash flows. Cendant Corporate Litigation Realogy Group (then Realogy Corporation) separated from Cendant on July 31, 2006 (the "Separation"), pursuant to a plan by Cendant (now known as Avis Budget Group, Inc.) to separate into four independent companies— one for each of Cendant's business units—real estate services (Realogy Group), travel distribution services ("Travelport"), hospitality services, including timeshare resorts ("Wyndham Worldwide"), and vehicle rental ("Avis Budget Group"). Pursuant to the Separation and Distribution Agreement dated as of July 27, 2006 among Cendant, Realogy Group, Wyndham Worldwide and Travelport (the "Separation and Distribution Agreement"), each of Realogy Group, Wyndham Worldwide and Travelport have assumed certain contingent and other corporate liabilities (and related costs and expenses), which are primarily related to each of their respective businesses. In addition, Realogy Group has assumed 62.5% and Wyndham Worldwide has assumed 37.5% of certain contingent and other corporate liabilities (and related costs and expenses) of Cendant or its subsidiaries, which are not primarily related to any of the respective businesses of Realogy Group, Wyndham Worldwide, Travelport and/or Cendant’s vehicle rental operations, in each case incurred or allegedly incurred on or prior to the date of the separation of Travelport from Cendant. * * * The Company believes that it has adequately accrued for legal matters as appropriate. The Company records litigation accruals for legal matters which are both probable and estimable. Litigation and other disputes are inherently unpredictable and subject to substantial uncertainties and unfavorable resolutions could occur. In addition, class action lawsuits can be costly to defend and, depending on the class size and claims, could be costly to settle. As such, the Company could incur judgments or enter into settlements of claims with liability that are materially in excess of amounts accrued and these settlements could have a material adverse effect on the Company’s financial condition, results of operations or cash flows in any particular period. Cendant Corporate Liabilities and Guarantees to Cendant and Affiliates In 2006, Realogy Group entered into certain guarantee commitments with Cendant (pursuant to the assumption of certain liabilities and the obligation to indemnify Cendant, Wyndham Worldwide and Travelport for such liabilities). These guarantee arrangements primarily relate to certain contingent litigation liabilities, contingent tax liabilities, and other corporate liabilities, of which Realogy Group assumed and is generally responsible for 62.5% . The due to former parent balance was $18 million at both March 31, 2018 and December 31, 2017 , respectively. The due to former parent balance was comprised of the Company’s portion of the following: (i) Cendant’s remaining state and foreign contingent tax liabilities, (ii) accrued interest on contingent tax liabilities, (iii) potential liabilities related to Cendant’s terminated or divested businesses, and (iv) potential liabilities related to the residual portion of accruals for Cendant operations. Tax Matters The Company is subject to income taxes in the United States and several foreign jurisdictions. Significant judgment is required in determining the worldwide provision for income taxes and recording related assets and liabilities. In the ordinary course of business, there are many transactions and calculations where the ultimate tax determination is uncertain. The Company is regularly under audit by tax authorities whereby the outcome of the audits is uncertain. The Company believes there is appropriate support for positions taken on its tax returns. The liabilities that have been recorded represent the best estimates of the probable loss on certain positions and are adequate for all open years based on an assessment of many factors including past experience and interpretations of tax law applied to the facts of each matter. However, the outcomes of tax audits are inherently uncertain. Escrow and Trust Deposits As a service to its customers, the Company administers escrow and trust deposits which represent undisbursed amounts received for the settlement of real estate transactions. Deposits at FDIC-insured institutions are insured up to $250 thousand . These escrow and trust deposits totaled $548 million at March 31, 2018 and $469 million at December 31, 2017 . These escrow and trust deposits are not assets of the Company and, therefore, are excluded from the accompanying Condensed Consolidated Balance Sheets. However, the Company remains contingently liable for the disposition of these deposits. |
Segment Information
Segment Information | 3 Months Ended |
Mar. 31, 2018 | |
Segment Reporting [Abstract] | |
Segment Information | SEGMENT INFORMATION The reportable segments presented below represent the Company’s operating segments for which separate financial information is available and which is utilized on a regular basis by its chief operating decision maker to assess performance and to allocate resources. In identifying its reportable segments, the Company also considers the nature of services provided by its operating segments. Management evaluates the operating results of each of its reportable segments based upon revenue and Operating EBITDA. Operating EBITDA is defined by us as net income (loss) before depreciation and amortization, interest expense, net (other than relocation services interest for securitization assets and securitization obligations), income taxes, and other items that are not core to the operating activities of the Company such as restructuring charges, former parent legacy items, losses on the early extinguishment of debt, asset impairments, gains or losses on discontinued operations and gains or losses on the sale of investments or other assets. The Company’s presentation of Operating EBITDA may not be comparable to similar measures used by other companies. Revenues (a) (b) Three Months Ended March 31, 2018 2017 Real Estate Franchise Services $ 176 $ 170 Company Owned Real Estate Brokerage Services 917 897 Relocation Services 79 77 Title and Settlement Services 120 120 Corporate and Other (c) (63 ) (61 ) Total Company $ 1,229 $ 1,203 _______________ (a) Transactions between segments are eliminated in consolidation. Revenues for the Real Estate Franchise Services segment include intercompany royalties and marketing fees paid by the Company Owned Real Estate Brokerage Services segment of $63 million and $61 million for the three months ended March 31, 2018 and 2017 , respectively. Such amounts are eliminated through the Corporate and Other line. (b) Revenues for the Relocation Services segment include intercompany referral commissions paid by the Company Owned Real Estate Brokerage Services segment of $8 million for both the three months ended March 31, 2018 and 2017 . Such amounts are recorded as contra-revenues by the Company Owned Real Estate Brokerage Services segment. There are no other material intersegment transactions. (c) Includes the elimination of transactions between segments. Operating EBITDA Three Months Ended March 31, 2018 2017 Real Estate Franchise Services $ 105 $ 102 Company Owned Real Estate Brokerage Services (45 ) (21 ) Relocation Services (1 ) 1 Title and Settlement Services (6 ) 2 Corporate and Other (a) (19 ) (23 ) Total Company $ 34 $ 61 Less: Depreciation and amortization (b) $ 50 $ 50 Interest expense, net 33 39 Income tax benefit (19 ) (9 ) Restructuring costs (c) 30 5 Loss on the early extinguishment of debt (d) 7 4 Net loss attributable to Realogy Holdings and Realogy Group $ (67 ) $ (28 ) _______________ (a) Includes the elimination of transactions between segments. (b) Depreciation and amortization for the three months ended March 31, 2018 includes $2 million of amortization expense related to Guaranteed Rate Affinity's purchase accounting included in the "Equity in losses of unconsolidated entities" line on the Condensed Consolidated Statement of Operations. (c) Includes restructuring charges of $2 million in the Real Estate Franchise Services segment, $17 million in the Company Owned Real Estate Brokerage Services segment, $8 million in the Cartus segment, $1 million at Title and Settlement Services segment and $2 million in Corporate and Other for the three months ended March 31, 2018 . Includes restructuring charges of $5 million in the Company Owned Real Estate Brokerage Services segment for the three months ended March 31, 2017 . (d) Loss on the early extinguishment of debt is recorded in the Corporate and Other segment. |
Basis Of Presentation Basis of
Basis Of Presentation Basis of Presentation (Policies) | 3 Months Ended |
Mar. 31, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Fair Value Measurement, Policy | The following tables present the Company’s assets and liabilities that are measured at fair value on a recurring basis and are categorized using the fair value hierarchy. The fair value hierarchy has three levels based on the reliability of the inputs used to determine fair value. Level Input: Input Definitions: Level I Inputs are unadjusted, quoted prices for identical assets or liabilities in active markets at the measurement date. Level II Inputs other than quoted prices included in Level I that are observable for the asset or liability through corroboration with market data at the measurement date. Level III Unobservable inputs that reflect management’s best estimate of what market participants would use in pricing the asset or liability at the measurement date. The availability of observable inputs can vary from asset to asset and is affected by a wide variety of factors, including, for example, the type of asset, whether the asset is new and not yet established in the marketplace, and other characteristics particular to the transaction. To the extent that valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment. Accordingly, the degree of judgment exercised by the Company in determining fair value is greatest for instruments categorized in Level III. In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes, the level in the fair value hierarchy within which the fair value measurement in its entirety falls is determined based on the lowest level input that is significant to the fair value measurement in its entirety. The fair value of financial instruments is generally determined by reference to quoted market values. In cases where quoted market prices are not available, fair value is based on estimates using present value or other valuation techniques, as appropriate. The fair value of interest rate swaps is determined based upon a discounted cash flow approach. The Company measures financial instruments at fair value on a recurring basis and recognizes transfers within the fair value hierarchy at the end of the fiscal quarter in which the change in circumstances that caused the transfer occurred. |
Equity Method Investments, Policy | Equity Method Investments At March 31, 2018 and December 31, 2017 , the Company had various equity method investments aggregating $55 million and $74 million , respectively, which are recorded within other non-current assets on the accompanying Condensed Consolidated Balance Sheets. The $55 million investment balance at March 31, 2018 included $47 million for the Company's investment in Guaranteed Rate Affinity, LLC ("Guaranteed Rate Affinity"). The Company's interest in PHH Home Loans, LLC ("PHH Home Loans") was sold to a subsidiary of PHH Corporation in the first quarter of 2018 and the Company received net cash proceeds of $19 million , reducing the investment balance to zero . The $74 million investment balance at December 31, 2017 included $48 million for the Company's investment in Guaranteed Rate Affinity and $19 million for the Company's investment in PHH Home Loans. For the first quarter of 2018, the Company recorded equity losses of $4 million at the Title and Settlement Services segment primarily related to costs associated with the ramp up of operations of Guaranteed Rate Affinity, including $2 million of amortization of intangible assets recorded in purchase accounting. For the first quarter of 2017, the Company recorded equity losses of $3 million primarily related to its investment in PHH Home Loans. The Company received $1 million of cash dividends during both the three months ended March 31, 2018 and 2017 . The Company invested an additional $4 million into Guaranteed Rate Affinity during the three months ended March 31, 2018 . |
Income Tax, Policy | Income Taxes The Company's provision for income taxes in interim periods is computed by applying its estimated annual effective tax rate against the income before income taxes for the period. In addition, non-recurring or discrete items are recorded in the period in which they occur. The provision for income taxes was a benefit of $19 million and $9 million for the three months ended March 31, 2018 and 2017 , respectively. There were no changes to the net benefit recorded during the year ended December 31, 2017 relating to the 2017 Tax Act which was a provisional amount that reflected the Company’s reasonable estimate at the time. |
Derivatives, Policy | Derivative Instruments The Company records derivatives and hedging activities on the balance sheet at their respective fair values. The Company uses foreign currency forward contracts largely to manage its exposure to changes in foreign currency exchange rates associated with its foreign currency denominated receivables and payables. The Company primarily manages its foreign currency exposure to the Euro, British Pound, Swiss Franc and Canadian Dollar. The Company has not elected to utilize hedge accounting for these forward contracts; therefore, any change in fair value is recorded in the Condensed Consolidated Statements of Operations. However, the fluctuations in the value of these forward contracts generally offset the impact of changes in the value of the underlying risk that they are intended to economically hedge. As of March 31, 2018 , the Company had outstanding foreign currency forward contracts in an asset position with a fair value of $1 million and a notional value of $26 million . As of December 31, 2017 , the Company had outstanding foreign currency forward contracts in a liability position with a fair value of less than $1 million and a notional value of $25 million . The Company also enters into interest rate swaps to manage its exposure to changes in interest rates associated with its variable rate borrowings. Interest rate swaps with a notional value of $425 million expired February 10, 2018. As of March 31, 2018 , the Company had interest rate swaps with an aggregate notional value of $1,050 million to offset the variability in cash flows resulting from the term loan facilities as follows: Notional Value (in millions) Commencement Date Expiration Date $600 August 2015 August 2020 $450 November 2017 November 2022 The swaps help to protect our outstanding variable rate borrowings from future interest rate volatility. The Company has not elected to utilize hedge accounting for these interest rate swaps; therefore, any change in fair value is recorded in the Condensed Consolidated Statements of Operations. The fair value of derivative instruments was as follows: Not Designated as Hedging Instruments Balance Sheet Location March 31, 2018 December 31, 2017 Interest rate swap contracts Other non-current assets $ 9 $ — Other current and non-current liabilities 6 13 The effect of derivative instruments on earnings was as follows: Derivative Instruments Not Designated as Hedging Instruments Location of Gain Recognized for Derivative Instruments Gain Recognized on Derivatives Three Months Ended March 31, 2018 2017 Interest rate swap contracts Interest expense $ (12 ) $ (1 ) |
Cash and Cash Equivalents, Restricted Cash and Cash Equivalents, Policy | Restricted Cash Restricted cash primarily relates to amounts specifically designated as collateral for the repayment of outstanding borrowings under the Company’s securitization facilities. Such amounts approximated $6 million and $7 million at March 31, 2018 and December 31, 2017 , respectively. |
Stock Repurchase Policy | Stock Repurchases The Company may repurchase shares of its common stock under authorizations made from its Board of Directors. Shares repurchased are retired and not displayed separately as treasury stock on the consolidated financial statements. The par value of the shares repurchased and retired is deducted from common stock and the excess of the purchase price over par value is first charged against any available additional paid-in capital with the balance charged to retained earnings. Direct costs incurred to repurchase the shares are included in the total cost of the shares. The Company's Board of Directors authorized a share repurchase program of up to $275 million , $300 million and $350 million of the Company's common stock in February 2016, 2017 and 2018, respectively. As of March 31, 2018 , the Company had repurchased and retired 20.2 million shares of common stock for an aggregate of $275 million under the February 2016 share repurchase program and $299 million under the February 2017 share repurchase program at a total weighted average market price of $28.36 per share, including 3.7 million shares of common stock repurchased during the first quarter of 2018 for $99 million at a weighted average market price of $26.58 per share. As of March 31, 2018 , $351 million remained available for repurchase under the share repurchase programs. |
Dividends Policy | In August 2016, the Company’s Board of Directors approved the initiation of a quarterly cash dividend policy of $0.09 per share on its common stock. The Board declared and paid a quarterly cash dividend of $0.09 per share of the Company’s common stock during the first quarter of 2018 . The declaration and payment of any future dividend will be subject to the discretion of the Board of Directors and will depend on a variety of factors, including the Company’s financial condition and results of operations, contractual restrictions, including restrictive covenants contained in the Company’s credit agreements, and the indentures governing the Company’s outstanding debt securities, capital requirements and other factors that the Board of Directors deems relevant. Pursuant to the Company’s policy, the dividends payable in cash are treated as a reduction of additional paid-in capital since the Company is currently in a retained deficit position. |
New Accounting Pronouncements, Policy | Recently Adopted Accounting Pronouncements In May 2014, the FASB issued Accounting Standards Update No. 2014-09 (Topic 606) " Revenue from Contracts with Customers " (the "new revenue standard"). The objective of the new revenue standard is to provide a single, comprehensive revenue recognition model for all contracts with customers to improve comparability within industries, across industries, and across capital markets. The new revenue standard contains principles that an entity will apply to determine the measurement of revenue and the timing of revenue recognition. The Company rewrote its current revenue recognition accounting policies based on the five-step model provided in the new revenue standard, assessed the redesign of internal controls, as well as evaluated the expanded disclosure requirements. After a review of the Company's revenue streams, the Company determined that the new revenue standard did not have a material impact on financial results as the majority of the Company's revenue is recognized at the completion of a homesale transaction which did not result in a change in the timing of recognition of revenue transactions under the new revenue standard. The Company adopted the new revenue standard on January 1, 2018 using the modified retrospective transition method in which the cumulative effect of applying the new revenue standard was recognized as an adjustment to the opening balance of retained earnings. See Note 2, "Revenue Recognition" for further details. In February 2018, the FASB issued a new standard which permits companies to reclassify certain income tax effects resulting from the 2017 Tax Act, called "stranded tax effects", from accumulated other comprehensive income ("AOCI") to retained earnings. According to the new guidance, the reclassification amount should include the effect of the change in the U.S. federal corporate income tax rate on the gross deferred tax amounts and related valuation allowances, if any, at the date of enactment of the 2017 Tax Act related to items remaining in AOCI. The guidance is effective for all companies for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years, with early adoption is permitted. The Company early adopted this standard in the first quarter of 2018 which resulted in a debit to Accumulated other comprehensive loss and a credit to Accumulated deficit for $9 million . The Company’s accounting policy for releasing income tax effects from AOCI is to release those effects when our entire portfolio of the type of item is liquidated. Recently Issued Accounting Pronouncements The Company considers the applicability and impact of all Accounting Standards Updates. ASUs not listed below were assessed and determined to be either not applicable or are expected to have minimal impact on our consolidated financial position or results of operations. In February 2016, the FASB issued its new standard on leases which requires virtually all leases to be recognized on the balance sheet. Lessees will recognize a right-of-use asset and a lease liability for all leases (other than leases that meet the definition of a short-term lease). The liability will be equal to the present value of lease payments. The asset will be based on the liability, subject to adjustment, such as for initial direct costs. For income statement purposes, the FASB retained a dual model, requiring leases to be classified as either operating or finance leases. Operating leases will result in straight-line expense, similar to current operating leases, while finance leases will result in a front-loaded expense pattern, similar to current capital leases. Classification will be based on criteria that are largely similar to those applied in current lease accounting, but without explicit bright lines. The new standard is effective for annual periods beginning after December 15, 2018. Early adoption is permitted. The new leasing standard requires modified retrospective transition, which requires application of the new guidance at the beginning of the earliest comparative period presented in the year of adoption. In January 2018, the FASB issued a proposed ASU that would allow entities to elect a simplified transition approach which would require applying the provisions of the new guidance at the effective date (e.g., January 1, 2019) as opposed to the earliest period presented under the modified retrospective approach (January 1, 2017). While the Company is still evaluating the impact of the standard on its consolidated financial statements, it does expect that the right to use asset and lease liability recorded on its Consolidated Balance Sheets will be material. The Company disclosed its future lease obligations in Note 13. "Commitments and Contingencies" of the Annual Report on Form 10-K for the year ended December 31, 2017 . The Company is in the process of evaluating its policies and internal controls as well as implementing a new lease management system which will be utilized to account for leases under the new guidance once adopted. |
Revenue Recognition Revenue R17
Revenue Recognition Revenue Recognition (Policies) | 3 Months Ended |
Mar. 31, 2018 | |
Revenue Recognition [Abstract] | |
Revenue Recognition, Policy [Policy Text Block] | Revenue Recognition Revenue is recognized upon the transfer of control of promised services to customers in an amount that reflects the consideration the Company expects to receive in exchange for those services in accordance with the new revenue standard. The Company's revenue is disaggregated by major revenue categories on our Condensed Consolidated Statements of Operations and further disaggregated by business segment as follows: Three Months Ended March 31, 2018 Real Estate Company Relocation Title and Corporate and Other Total Gross commission income (a) $ — $ 902 $ — $ — $ — $ 902 Service revenue (b) — 2 78 117 — 197 Franchise fees (c) 139 — — — (60 ) 79 Other (d) 37 13 1 3 (3 ) 51 Net revenues $ 176 $ 917 $ 79 $ 120 $ (63 ) $ 1,229 Three Months Ended March 31, 2017 (e) Real Estate Company Relocation Title and Corporate and Other Total Gross commission income (a) $ — $ 881 $ — $ — $ — $ 881 Service revenue (b) — 2 76 116 — 194 Franchise fees (c) 134 — — — (59 ) 75 Other (d) 36 14 1 4 (2 ) 53 Net revenues $ 170 $ 897 $ 77 $ 120 $ (61 ) $ 1,203 _______________ (a) During both the three months ended March 31, 2018 and March 31, 2017, approximately 74% of the Company's total net revenues, related to gross commission income at the Company Owned Brokerage Services segment which is recognized at a point in time at the closing of a homesale transaction. (b) During both the three months ended March 31, 2018 and March 31, 2017, approximately 16% of the Company's total net revenues related to service fees primarily consisting of title and escrow fees at the Title and Settlement Services segment ( 10% ), which are recognized at a point in time at the closing of a homesale transaction, and relocation fees at the Relocation Services segment ( 6% ), which are recognized as revenue when or as the related performance obligation is satisfied, which is dependent on the type of service performed. Relocation fees at the Relocation Services segment primarily include: (i) referral fees which are recognized at a point in time at the closing of a homesale transaction, (ii) outsourcing fees, which are management fees charged to clients frequently related to a bundle of relocation services performed and are recognized over the average time period to complete a move, and (iii) referral commissions from third party suppliers which are recognized at the time of the completion of the related service. (c) During both the three months ended March 31, 2018 and March 31, 2017, approximately 6% of the Company's total net revenues related to franchise fees at the Real Estate Franchise Services segment, primarily domestic royalties, which are recognized at a point in time when the underlying franchisee revenue is earned (upon close of the homesale transaction). (d) During both the three months ended March 31, 2018 and March 31, 2017, approximately 4% of the Company's total net revenues related to other revenue which comprised of brand marketing funds received at the Real Estate Franchise Services segment from franchisees and other miscellaneous revenues across all of the business segments. (e) Prior period amounts have not been adjusted under the modified retrospective method. The Company's revenue streams are discussed further below by business segment: Real Estate Franchise Services The Company franchises its real estate brands to real estate brokerage businesses that are independently owned and operated. Franchise revenue principally consists of royalty and marketing fees from the Company’s franchisees. The royalty received is primarily based on a percentage of the franchisee’s gross commission income. Royalty fees are accrued as the underlying franchisee revenue is earned (upon close of the homesale transaction). Annual volume incentives given to certain franchisees on royalty fees are recorded as a reduction to revenue and are accrued for in relative proportion to the recognition of the underlying gross franchise revenue. Non-standard sales incentives are recorded as a reduction to revenue ratably over the related performance period or from the date of issuance through the remaining life of the related franchise agreement. Franchise revenue also includes initial franchise fees which are generally non-refundable and recognized by the Company as revenue upon the execution or opening of a new franchisee office to cover the upfront costs associated with opening the franchisee for business under one of Realogy’s brands. The Company also earns marketing fees from its franchisees and utilizes such fees to fund marketing campaigns on behalf of its franchisees. As such, brand marketing fund fees are recorded as deferred revenue when received and recognized into revenue as earned when these funds are spent on marketing activities. The balance for deferred brand marketing fund fees decreased from $13 million at January 1, 2018 to $9 million at March 31, 2018 primarily due to amounts recognized into revenue matching expenses for marketing activities partially offset by additional fees received from franchisees during the first quarter of 2018. The Company collects initial ADFs for international territory transactions, which are recorded as deferred revenue when received and recognized into revenue over the average 25 year life of the related franchise agreement as consideration for the right to access and benefit from Realogy’s brands. The balance for deferred ADFs decreased from $58 million at January 1, 2018 to $57 million at March 31, 2018 due to revenues recognized during the first quarter of 2018 that were included in the deferred revenue balance at the beginning of the period. There were no additional initial area development fees received during the three months ended March 31, 2018. The Real Estate Franchise Services segment records deferred income related to various other revenue contracts. The balance of other deferred income increased from $8 million at January 1, 2018 to $9 million at March 31, 2018 as a result of cash payments received or due during the first quarter of 2018 partially offset by revenues recognized as the performance obligations were satisfied. In addition, the Company recognizes a deferred asset for commissions paid to Realogy franchise sales employees upon the sale of a new franchise as these are considered costs of obtaining a contract with a customer that are expected to provide benefits to the Company for longer than one year. The amount of commissions is calculated as a percentage of the anticipated gross commission income of the new franchisee or ADF and is amortized over 30 years for domestic franchise agreements or the agreement term for international franchise agreements (generally 25 years). Company Owned Real Estate Brokerage Services As an owner-operator of real estate brokerages, the Company assists home buyers and sellers in listing, marketing, selling and finding homes. Real estate commissions earned by the Company’s real estate brokerage business are recorded as revenue at a point in time which is upon the closing of a real estate transaction (i.e., purchase or sale of a home). These revenues are referred to as gross commission income. The commissions the Company pays to real estate agents are recognized concurrently with associated revenues and presented as the commission and other agent-related costs line item on the accompanying Condensed Consolidated Statements of Operations. The Company has relationships with developers, primarily in major cities, to provide marketing and brokerage services in new developments. New development closings generally have a development period of between 18 and 24 months from contracted date to closing. In some cases, the Company receives advanced commissions which are recorded as deferred revenue when received and recognized as revenue when the new development closes. The balance of advanced commissions related to developments at January 1, 2018 was a liability of $10 million which increased $2 million related to additional commissions received for new developments and decreased $2 million due to revenues recognized on units closed during the three months ended March 31, 2018. The balance of advance commissions related to developments was $10 million at March 31, 2018. Relocation Services The Company provides relocation services to corporate and government clients for the transfer of their employees ("transferees"). Such services include homesale assistance including the purchasing and/or selling of a transferee’s home and providing home equity advances to transferees (generally guaranteed by the individual's employer), arranging household goods moving services, and other relocation services such as expense processing, relocation policy counseling, relocation-related accounting, coordinating visa and immigration support, intercultural and language training and destination services. In the majority of relocation transactions, the gain or loss on the sale of a transferee’s home is generally borne by the individual's employer. C lients may pay an outsourcing management fee that can cover several of the relocation services listed above, according to the clients' specific needs. In addition, the Company provides home buying and selling assistance to members of Affinity organizations. The Company earns referral commission revenue primarily from real estate brokers for the home sale and purchase of transferees a nd Affinity members, which is recognized at a point in time when the underlying property closes, and revenues from other third-party service providers where the Company earns a referral commission, which is recognized at the point in time at the completion of services. Furthermore, the Company generally earns interest income on the funds it advances on behalf of the transferring employee, which is recorded within other revenue (as is the corresponding interest expense on the securitization obligations) in the accompanying Condensed Consolidated Statements of Operations. The Company earns revenues from outsourcing management fees charged to clients for the performance and facilitation of relocation services. Outsourcing management fees are recorded as deferred revenue when billed (usually at the start of the relocation) and are recognized as revenue over the average time period required to complete the transferee's move, or a phase of the move that the fee covers, which is typically 3 to 6 months depending on the move type. The balance for outsourcing management fees increased from $5 million on January 1, 2018 to $6 million on March 31, 2018. The increase was primarily due to additions of $13 million during the first quarter of 2018 primarily related to new management fees billed on new relocation files in the first quarter of 2018, in advance of the Company satisfying its performance obligation, partially offset by a $12 million decrease as a result of revenues recognized during the first quarter of 2018 as the performance obligations were satisfied. The Relocation Services segment manages the Cartus Broker Network, which is a network of real estate brokers consisting of our company owned brokerage operations, select franchisees and independent real estate brokers who have been approved to become members. Network fees are billed in the fourth quarter of the previous year for the following year's membership and recognized into revenue on a straight-line basis each month during the membership period. The balance for Cartus Broker Membership decreased from $8 million at January 1, 2018 to $6 million at March 31, 2018 primarily due to $3 million of revenues recognized during the first quarter of 2018 that were included in the deferred revenue balance at the beginning of the period. Title and Settlement Services The Company provides title and closing services, which include title search procedures for title insurance policies, homesale escrow and other closing services. Title revenues, which are recorded net of amounts remitted to third-party insurance underwriters, and title and closing service fees are recorded at a point in time which occurs at the time a homesale transaction or refinancing closes. The Company also owns an underwriter of title insurance. For independent title agents, the underwriter recognizes policy premium revenue on a gross basis (before deduction of agent commission) upon notice of policy issuance from the agent. For affiliated title agents, the underwriter recognizes the incremental policy premium revenue upon the effective date of the title policy as the agent commission revenue is already recognized by the affiliated title agent. Contract Balances (Deferred Revenue) The following table shows the change in the Company's contract liabilities related to revenue contracts by reportable segment for the period: Three Months Ended March 31, 2018 Beginning Balance at January 1, 2018 Additions during the period Recognized as Revenue during the period Ending Balance at March 31, 2018 Real Estate Franchise Services (a) $ 79 $ 30 $ (34 ) $ 75 Company Owned Real Estate Brokerage Services 17 3 (4 ) 16 Relocation Services 18 19 (19 ) 18 Total $ 114 $ 52 $ (57 ) $ 109 _______________ (a) Revenues recognized include intercompany marketing fees paid by the Company Owned Real Estate Brokerage Services segment. |
Basis Of Presentation (Tables)
Basis Of Presentation (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Fair Value Hierarchy | The following table summarizes fair value measurements by level at March 31, 2018 for assets and liabilities measured at fair value on a recurring basis: Level I Level II Level III Total Deferred compensation plan assets (included in other non-current assets) $ 3 $ — $ — $ 3 Interest rate swaps (included in other non-current assets) — 9 — 9 Interest rate swaps (included in other non-current liabilities) — 6 — 6 Contingent consideration for acquisitions (included in accrued expenses and other current liabilities and other non-current liabilities) — — 34 34 The following table summarizes fair value measurements by level at December 31, 2017 for assets and liabilities measured at fair value on a recurring basis: Level I Level II Level III Total Deferred compensation plan assets (included in other non-current assets) $ 3 $ — $ — $ 3 Interest rate swaps (included in other current and non-current liabilities) — 13 — 13 Contingent consideration for acquisitions (included in accrued expenses and other current liabilities and other non-current liabilities) — — 34 34 |
Fair Value, by Balance Sheet Grouping | The following table summarizes the principal amount of the Company’s indebtedness compared to the estimated fair value, primarily determined by quoted market values, at: March 31, 2018 December 31, 2017 Debt Principal Amount Estimated Principal Amount Estimated Senior Secured Credit Facility: Revolving Credit Facility $ 302 $ 302 $ 70 $ 70 Term Loan B 1,077 1,083 1,083 1,085 Term Loan A Facility: Term Loan A 750 750 391 393 Term Loan A-1 — — 342 343 4.50% Senior Notes 450 452 450 457 5.25% Senior Notes 550 553 550 569 4.875% Senior Notes 500 479 500 495 Securitization obligations 184 184 194 194 _______________ (a) The fair value of the Company's indebtedness is categorized as Level II. |
Schedule of Derivative Instruments | Notional Value (in millions) Commencement Date Expiration Date $600 August 2015 August 2020 $450 November 2017 November 2022 |
Schedule of Derivative Instruments in Statement of Financial Position, Fair Value | The fair value of derivative instruments was as follows: Not Designated as Hedging Instruments Balance Sheet Location March 31, 2018 December 31, 2017 Interest rate swap contracts Other non-current assets $ 9 $ — Other current and non-current liabilities 6 13 |
Schedule of Other Derivatives Not Designated as Hedging Instruments, Statements of Financial Performance and Financial Position, Location | The effect of derivative instruments on earnings was as follows: Derivative Instruments Not Designated as Hedging Instruments Location of Gain Recognized for Derivative Instruments Gain Recognized on Derivatives Three Months Ended March 31, 2018 2017 Interest rate swap contracts Interest expense $ (12 ) $ (1 ) |
Revenue Recognition Revenue R19
Revenue Recognition Revenue Recognition (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Revenue Recognition [Abstract] | |
Schedule of New Accounting Pronouncements and Changes in Accounting Principles [Table Text Block] | The cumulative effect of the changes made to the Condensed Consolidated Balance Sheets for the adoption of the new revenue standard were as follows: Balance Sheet accounts prior to the new revenue standard adoption adjustments Adjustments due to the adoption of the new revenue standard Balance Sheet accounts after the new revenue standard adoption adjustments ASSETS Current assets: Trade receivables $ 153 $ 1 $ 154 Other current assets 179 2 181 Total current assets 789 3 792 Other non-current assets 222 23 245 Total assets $ 7,337 $ 26 $ 7,363 LIABILITIES AND EQUITY Current liabilities: Accrued expenses and other current liabilities $ 478 $ 2 $ 480 Total current liabilities 955 2 957 Deferred income taxes 327 (8 ) 319 Other non-current liabilities 212 54 266 Total liabilities 4,715 48 4,763 Equity: Accumulated deficit (a) (2,622 ) (22 ) (2,644 ) Accumulated other comprehensive loss (a) (46 ) — (46 ) Total stockholders' equity 2,618 (22 ) 2,596 Total equity 2,622 (22 ) 2,600 Total liabilities and equity $ 7,337 $ 26 $ 7,363 _______________ (a) Beginning balances have been adjusted for the adoption of the accounting standard update on stranded tax effects related to the 2017 Tax Act which resulted in a debit to Accumulated other comprehensive loss and a credit to Accumulated deficit of $9 million . See Note 1, "Basis of Presentation" in the "Recently Adopted Accounting Pronouncements" section for additional information. |
Disaggregation of Revenue [Table Text Block] | The Company's revenue is disaggregated by major revenue categories on our Condensed Consolidated Statements of Operations and further disaggregated by business segment as follows: Three Months Ended March 31, 2018 Real Estate Company Relocation Title and Corporate and Other Total Gross commission income (a) $ — $ 902 $ — $ — $ — $ 902 Service revenue (b) — 2 78 117 — 197 Franchise fees (c) 139 — — — (60 ) 79 Other (d) 37 13 1 3 (3 ) 51 Net revenues $ 176 $ 917 $ 79 $ 120 $ (63 ) $ 1,229 Three Months Ended March 31, 2017 (e) Real Estate Company Relocation Title and Corporate and Other Total Gross commission income (a) $ — $ 881 $ — $ — $ — $ 881 Service revenue (b) — 2 76 116 — 194 Franchise fees (c) 134 — — — (59 ) 75 Other (d) 36 14 1 4 (2 ) 53 Net revenues $ 170 $ 897 $ 77 $ 120 $ (61 ) $ 1,203 _______________ (a) During both the three months ended March 31, 2018 and March 31, 2017, approximately 74% of the Company's total net revenues, related to gross commission income at the Company Owned Brokerage Services segment which is recognized at a point in time at the closing of a homesale transaction. (b) During both the three months ended March 31, 2018 and March 31, 2017, approximately 16% of the Company's total net revenues related to service fees primarily consisting of title and escrow fees at the Title and Settlement Services segment ( 10% ), which are recognized at a point in time at the closing of a homesale transaction, and relocation fees at the Relocation Services segment ( 6% ), which are recognized as revenue when or as the related performance obligation is satisfied, which is dependent on the type of service performed. Relocation fees at the Relocation Services segment primarily include: (i) referral fees which are recognized at a point in time at the closing of a homesale transaction, (ii) outsourcing fees, which are management fees charged to clients frequently related to a bundle of relocation services performed and are recognized over the average time period to complete a move, and (iii) referral commissions from third party suppliers which are recognized at the time of the completion of the related service. (c) During both the three months ended March 31, 2018 and March 31, 2017, approximately 6% of the Company's total net revenues related to franchise fees at the Real Estate Franchise Services segment, primarily domestic royalties, which are recognized at a point in time when the underlying franchisee revenue is earned (upon close of the homesale transaction). (d) During both the three months ended March 31, 2018 and March 31, 2017, approximately 4% of the Company's total net revenues related to other revenue which comprised of brand marketing funds received at the Real Estate Franchise Services segment from franchisees and other miscellaneous revenues across all of the business segments. (e) Prior period amounts have not been adjusted under the modified retrospective method. |
Contract with Customer, Asset and Liability [Table Text Block] | The following table shows the change in the Company's contract liabilities related to revenue contracts by reportable segment for the period: Three Months Ended March 31, 2018 Beginning Balance at January 1, 2018 Additions during the period Recognized as Revenue during the period Ending Balance at March 31, 2018 Real Estate Franchise Services (a) $ 79 $ 30 $ (34 ) $ 75 Company Owned Real Estate Brokerage Services 17 3 (4 ) 16 Relocation Services 18 19 (19 ) 18 Total $ 114 $ 52 $ (57 ) $ 109 _______________ (a) Revenues recognized include intercompany marketing fees paid by the Company Owned Real Estate Brokerage Services segment. |
Intangible Assets (Tables)
Intangible Assets (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill by segment and changes in the carrying amount | Goodwill by segment and changes in the carrying amount are as follows: Real Estate Franchise Services Company Owned Brokerage Services Relocation Services Title and Settlement Services Total Company Gross goodwill as of December 31, 2017 $ 3,315 $ 1,062 $ 641 $ 478 $ 5,496 Accumulated impairment losses (1,023 ) (158 ) (281 ) (324 ) (1,786 ) Balance at December 31, 2017 2,292 904 360 154 3,710 Goodwill acquired (a) — 1 — — 1 Balance at March 31, 2018 $ 2,292 $ 905 $ 360 $ 154 $ 3,711 _______________ (a) Goodwill acquired during the three months ended March 31, 2018 relates to the acquisition of one real estate brokerage operation. |
Intangible assets | Intangible assets are as follows: As of March 31, 2018 As of December 31, 2017 Gross Carrying Amount Accumulated Amortization Net Carrying Amount Gross Carrying Amount Accumulated Amortization Net Carrying Amount Amortizable—Franchise agreements (a) $ 2,019 $ 742 $ 1,277 $ 2,019 $ 725 $ 1,294 Indefinite life—Trademarks (b) $ 749 $ 749 $ 749 $ 749 Other Intangibles Amortizable—License agreements (c) $ 45 $ 10 $ 35 $ 45 $ 10 $ 35 Amortizable—Customer relationships (d) 549 341 208 549 335 214 Indefinite life—Title plant shares (e) 18 18 18 18 Amortizable—Pendings and listings (f) — — — 2 1 1 Amortizable—Other (g) 33 18 15 33 17 16 Total Other Intangibles $ 645 $ 369 $ 276 $ 647 $ 363 $ 284 _______________ (a) Generally amortized over a period of 30 years. (b) Primarily relates to the Century 21 ® , Coldwell Banker ® , ERA ® , Corcoran ® , Coldwell Banker Commercial ® and Cartus tradenames, which are expected to generate future cash flows for an indefinite period of time. (c) Relates to the Sotheby’s International Realty ® and Better Homes and Gardens ® Real Estate agreements which are being amortized over 50 years (the contractual term of the license agreements). (d) Relates to the customer relationships at the Relocation Services segment, the Title and Settlement Services segment and our Company Owned Real Estate Brokerage Services segment. These relationships are being amortized over a period of 2 to 20 years. (e) Ownership in a title plant is required to transact title insurance in certain states. The Company expects to generate future cash flows for an indefinite period of time. (f) Generally amortized over a period of 5 months . (g) Consists of covenants not to compete which are amortized over their contract lives and other intangibles which are generally amortized over periods ranging from 5 to 10 years. |
Intangible asset amortization expense | Intangible asset amortization expense is as follows: Three Months Ended March 31, 2018 2017 Franchise agreements $ 17 $ 17 License agreements — — Customer relationships 6 6 Pendings and listings 1 1 Other 1 2 Total $ 25 $ 26 |
Accrued Expenses And Other Cu21
Accrued Expenses And Other Current Liabilities (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Payables and Accruals [Abstract] | |
Accrued expenses and other current liabilities | Accrued expenses and other current liabilities consisted of: March 31, 2018 December 31, 2017 Accrued payroll and related employee costs $ 86 $ 140 Accrued volume incentives 30 41 Accrued commissions 34 38 Restructuring accruals 12 5 Deferred income 65 68 Accrued interest 35 13 Contingent consideration for acquisitions 26 26 Due to former parent 18 18 Other 120 129 Total accrued expenses and other current liabilities $ 426 $ 478 |
Short And Long-Term Debt (Table
Short And Long-Term Debt (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Debt Disclosure [Abstract] | |
Schedule of Total Indebtedness | Total indebtedness is as follows: March 31, 2018 December 31, 2017 Senior Secured Credit Facility: Revolving Credit Facility $ 302 $ 70 Term Loan B (1) 1,060 1,063 Term Loan A Facility: Term Loan A (1) 745 390 Term Loan A-1 — 339 4.50% Senior Notes 445 444 5.25% Senior Notes 546 546 4.875% Senior Notes 497 496 Total Short-Term & Long-Term Debt $ 3,595 $ 3,348 Securitization Obligations: Apple Ridge Funding LLC $ 170 $ 181 Cartus Financing Limited 14 13 Total Securitization Obligations $ 184 $ 194 _______________ (1) As of March 31, 2018 , after giving effect to the February 2018 refinancing transactions discussed in this Note 5 under the headings "Senior Secured Credit Facility" and "Term Loan A Facility." |
Schedule of Debt | As of March 31, 2018 , the Company’s borrowing arrangements were as follows: Interest Expiration Principal Amount Unamortized Discount and Debt Issuance Costs Net Amount Senior Secured Credit Facility: Revolving Credit Facility (1) (2) February 2023 $ 302 $ * $ 302 Term Loan B (3) February 2025 1,077 17 1,060 Term Loan A Facility: Term Loan A (4) February 2023 750 5 745 Senior Notes 4.50% April 2019 450 5 445 Senior Notes 5.25% December 2021 550 4 546 Senior Notes 4.875% June 2023 500 3 497 Securitization obligations: (5) Apple Ridge Funding LLC (6) June 2018 170 * 170 Cartus Financing Limited (7) August 2018 14 * 14 Total (8) $ 3,813 $ 34 $ 3,779 _______________ * The debt issuance costs related to our Revolving Credit Facility and securitization obligations are classified as a deferred financing asset within other assets. (1) As of March 31, 2018 , the Company had $1,400 million of borrowing capacity under its Revolving Credit Facility, leaving $1,098 million of available capacity. The Revolving Credit Facility expires in February 2023 , but is classified on the balance sheet as current due to the revolving nature of the facility. On May 1, 2018 , the Company had $372 million in outstanding borrowings under the Revolving Credit Facility, leaving $1,028 million of available capacity. (2) Interest rates with respect to revolving loans under the Senior Secured Credit Facility at March 31, 2018 were based on, at the Company's option, (a) adjusted London Interbank Offering Rate (" LIBOR ") plus an additional margin or (b) JP Morgan Chase Bank, N.A.'s prime rate (" ABR ") plus an additional margin, in each case subject to adjustment based on the then current senior secured leverage ratio. Based on the previous quarter senior secured leverage ratio, the LIBOR margin was 2.00% and the ABR margin was 1.00% for the three months ended March 31, 2018 . (3) The Term Loan B provides for quarterly amortization payments totaling 1% per annum of the original principal amount. The interest rate with respect to term loans under the Term Loan B is based on, at the Company’s option, (a) adjusted LIBOR plus 2.25% (with a LIBOR floor of 0.75% ) or (b) ABR plus 1.25% (with an ABR floor of 1.75% ). (4) The Term Loan A provides for quarterly amortization payments, which commence on June 30, 2018, totaling per annum 2.5% , 2.5% , 5.0% , 7.5% and 10.0% of the original principal amount of the Term Loan A, with the last amortization payment to be made on February 8, 2023. The interest rates with respect to term loans under the Term Loan A are based on, at the Company's option, (a) adjusted LIBOR plus an additional margin or (b) ABR plus an additional margin, in each case subject to adjustment based on the then current senior secured leverage ratio. Based on the previous quarter senior secured leverage ratio, the LIBOR margin was 2.00% and the ABR margin was 1.00% for the three months ended March 31, 2018 . (5) Available capacity is subject to maintaining sufficient relocation related assets to collateralize these securitization obligations. (6) As of March 31, 2018 , the Company had $250 million of borrowing capacity under the Apple Ridge Funding LLC securitization program leaving $80 million of available capacity. (7) Consists of a £10 million revolving loan facility and a £5 million working capital facility. As of March 31, 2018 , the Company had $21 million of borrowing capacity under the Cartus Financing Limited securitization program leaving $7 million of available capacity. (8) Not included in this table is the Company's Unsecured Letter of Credit Facility which had a capacity of $74 million with $66 million utilized at a weighted average rate of 3.24% at March 31, 2018 . |
Schedule of Maturities of Long-term Debt | Year Amount Remaining 2018 (a) $ 324 2019 480 2020 44 2021 613 2022 81 _______________ (a) The current portion of long-term debt consists of remaining 2018 amortization payments totaling $14 million and $8 million for the Term Loan A and Term Loan B facilities, respectively, as well as $302 million of revolver borrowings under the Revolving Credit Facility which expires in February 2023 , but are classified on the balance sheet as current due to the revolving nature of the facility. |
Interest Rate Table for Revolving Credit Facility | Senior Secured Leverage Ratio Applicable LIBOR Margin Applicable ABR Margin Greater than 3.50 to 1.00 2.50% 1.50% Less than or equal to 3.50 to 1.00 but greater than or equal to 2.50 to 1.00 2.25% 1.25% Less than 2.50 to 1.00 but greater than or equal to 2.00 to 1.00 2.00% 1.00% Less than 2.00 to 1.00 1.75% 0.75% |
Interest Rate Table for Term Loan A | Senior Secured Leverage Ratio Applicable LIBOR Margin Applicable ABR Margin Greater than 3.50 to 1.00 2.50% 1.50% Less than or equal to 3.50 to 1.00 but greater than or equal to 2.50 to 1.00 2.25% 1.25% Less than 2.50 to 1.00 but greater than or equal to 2.00 to 1.00 2.00% 1.00% Less than 2.00 to 1.00 1.75% 0.75% |
Expiration Capacity Table for Unsecured Letter of Credit Facilities | The facility's expiration dates are as follows: Capacity (in millions) Expiration Date $8 September 2018 $66 December 2019 |
Restructuring Costs Restructu23
Restructuring Costs Restructuring Costs (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Restructuring and Related Activities [Abstract] | |
Restructuring and Related Costs | The components of the restructuring charges for the three months ended March 31, 2018 and 2017 were as follows: Three Months Ended March 31, 2018 2017 Personnel-related costs (1) $ 14 $ 5 Facility-related costs (2) 9 — Internal use software impairment (3) 7 — Total restructuring charges $ 30 $ 5 _______________ (1) Personnel-related costs consist of severance costs provided to employees who have been terminated and duplicate payroll costs during transition. (2) Facility-related costs consist of costs associated with planned facility closures such as contract termination costs, lease payments, net of applicable sublease income, that will continue to be incurred under the contract for its remaining term without economic benefit to the Company, accelerated depreciation on asset disposals and other facility and employee relocation related costs. (3) Internal use software impairment relates to development costs capitalized for a project that was determined to not meet the Company's strategic goals when analyzed by the Company's new leadership team. |
Schedule of Restructuring Reserve by Type of Cost | The following is a reconciliation of the beginning and ending reserve balances for the restructuring program related to Leadership Realignment and Other Restructuring Activities: Personnel-related costs Facility-related costs Internal use software impairment Total Balance at December 31, 2017 $ — $ — $ — $ — Restructuring charges 14 8 7 29 Costs paid or otherwise settled (8 ) (1 ) (7 ) (16 ) Balance at March 31, 2018 $ 6 $ 7 $ — $ 13 |
Schedule of Expected Restructuring Costs by Cost Type | The following table shows the total costs currently expected to be incurred by type of cost the restructuring program related to Leadership Realignment and Other Restructuring Activities: Total amount expected to be incurred Amount incurred to date Total amount remaining to be incurred Personnel-related costs $ 17 $ 14 $ 3 Facility-related costs 17 8 9 Internal use software impairment 7 7 — Total $ 41 $ 29 $ 12 |
Schedule of Expected Restructuring Costs by Business Segment | The following table shows the total costs currently expected to be incurred by reportable segment for the restructuring program related to Leadership Realignment and Other Restructuring Activities: Total amount expected to be incurred Amount incurred to date Total amount remaining to be incurred Real Estate Franchise Services $ 2 $ 2 $ — Company Owned Real Estate Brokerage Services 27 16 11 Relocation Services 9 8 1 Title and Settlement Services 1 1 — Corporate and Other 2 2 — Total $ 41 $ 29 $ 12 |
Segment Information (Tables)
Segment Information (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Segment Reporting [Abstract] | |
Revenues | Revenues (a) (b) Three Months Ended March 31, 2018 2017 Real Estate Franchise Services $ 176 $ 170 Company Owned Real Estate Brokerage Services 917 897 Relocation Services 79 77 Title and Settlement Services 120 120 Corporate and Other (c) (63 ) (61 ) Total Company $ 1,229 $ 1,203 _______________ (a) Transactions between segments are eliminated in consolidation. Revenues for the Real Estate Franchise Services segment include intercompany royalties and marketing fees paid by the Company Owned Real Estate Brokerage Services segment of $63 million and $61 million for the three months ended March 31, 2018 and 2017 , respectively. Such amounts are eliminated through the Corporate and Other line. (b) Revenues for the Relocation Services segment include intercompany referral commissions paid by the Company Owned Real Estate Brokerage Services segment of $8 million for both the three months ended March 31, 2018 and 2017 . Such amounts are recorded as contra-revenues by the Company Owned Real Estate Brokerage Services segment. There are no other material intersegment transactions. (c) Includes the elimination of transactions between segments. |
Operating EBITDA | Operating EBITDA Three Months Ended March 31, 2018 2017 Real Estate Franchise Services $ 105 $ 102 Company Owned Real Estate Brokerage Services (45 ) (21 ) Relocation Services (1 ) 1 Title and Settlement Services (6 ) 2 Corporate and Other (a) (19 ) (23 ) Total Company $ 34 $ 61 Less: Depreciation and amortization (b) $ 50 $ 50 Interest expense, net 33 39 Income tax benefit (19 ) (9 ) Restructuring costs (c) 30 5 Loss on the early extinguishment of debt (d) 7 4 Net loss attributable to Realogy Holdings and Realogy Group $ (67 ) $ (28 ) _______________ (a) Includes the elimination of transactions between segments. (b) Depreciation and amortization for the three months ended March 31, 2018 includes $2 million of amortization expense related to Guaranteed Rate Affinity's purchase accounting included in the "Equity in losses of unconsolidated entities" line on the Condensed Consolidated Statement of Operations. (c) Includes restructuring charges of $2 million in the Real Estate Franchise Services segment, $17 million in the Company Owned Real Estate Brokerage Services segment, $8 million in the Cartus segment, $1 million at Title and Settlement Services segment and $2 million in Corporate and Other for the three months ended March 31, 2018 . Includes restructuring charges of $5 million in the Company Owned Real Estate Brokerage Services segment for the three months ended March 31, 2017 . (d) Loss on the early extinguishment of debt is recorded in the Corporate and Other segment. |
Basis Of Presentation Financial
Basis Of Presentation Financial Instruments - Fair Value Measurements (Details) - Fair Value, Measurements, Recurring - USD ($) $ in Millions | Mar. 31, 2018 | Dec. 31, 2017 |
Deferred Compensation Plan Assets | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation plan assets (included in other non-current assets) | $ 3 | $ 3 |
Deferred Compensation Plan Assets | Level I | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation plan assets (included in other non-current assets) | 3 | 3 |
Deferred Compensation Plan Assets | Level II | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation plan assets (included in other non-current assets) | 0 | 0 |
Deferred Compensation Plan Assets | Level III | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation plan assets (included in other non-current assets) | 0 | 0 |
Interest Rate Swap | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Interest rate swaps (included in other non-current assets) | 9 | |
Interest rate swaps (included in other current and non-current liabilities) | 6 | 13 |
Interest Rate Swap | Level I | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Interest rate swaps (included in other non-current assets) | 0 | |
Interest rate swaps (included in other current and non-current liabilities) | 0 | 0 |
Interest Rate Swap | Level II | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Interest rate swaps (included in other non-current assets) | 9 | |
Interest rate swaps (included in other current and non-current liabilities) | 6 | 13 |
Interest Rate Swap | Level III | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Interest rate swaps (included in other non-current assets) | 0 | |
Interest rate swaps (included in other current and non-current liabilities) | 0 | 0 |
Contingent Consideration for Acquisitions | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Contingent consideration for acquisitions (included in accrued expenses and other current liabilities and other non-current liabilities) | 34 | 34 |
Contingent Consideration for Acquisitions | Level I | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Contingent consideration for acquisitions (included in accrued expenses and other current liabilities and other non-current liabilities) | 0 | 0 |
Contingent Consideration for Acquisitions | Level II | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Contingent consideration for acquisitions (included in accrued expenses and other current liabilities and other non-current liabilities) | 0 | 0 |
Contingent Consideration for Acquisitions | Level III | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Contingent consideration for acquisitions (included in accrued expenses and other current liabilities and other non-current liabilities) | $ 34 | $ 34 |
Basis Of Presentation Financi26
Basis Of Presentation Financial Instruments - Fair Value Indebtedness Table (Details) - USD ($) $ in Millions | Mar. 31, 2018 | Feb. 28, 2018 | Dec. 31, 2017 | |||
Long-term debt principal amount | [1] | $ 3,813 | ||||
Securitization obligations outstanding | 184 | $ 194 | ||||
Secured Debt | Term Loan B (1) | ||||||
Long-term debt principal amount | 1,077 | [2] | $ 1,080 | 1,083 | ||
Long-term debt fair value | [3] | 1,083 | 1,085 | |||
Secured Debt | Term Loan A | ||||||
Long-term debt principal amount | 750 | [4] | $ 750 | 391 | ||
Long-term debt fair value | [3] | 750 | 393 | |||
Secured Debt | Term Loan A-1 | ||||||
Long-term debt principal amount | 0 | [5] | 342 | [4] | ||
Long-term debt fair value | [3] | 0 | 343 | |||
Senior Notes | 4.50% Senior Notes | ||||||
Long-term debt principal amount | 450 | 450 | ||||
Long-term debt fair value | [3] | 452 | 457 | |||
Senior Notes | 5.25% Senior Notes | ||||||
Long-term debt principal amount | 550 | 550 | ||||
Long-term debt fair value | [3] | 553 | 569 | |||
Senior Notes | 4.875% Senior Notes | ||||||
Long-term debt principal amount | 500 | 500 | ||||
Long-term debt fair value | [3] | 479 | 495 | |||
Line of Credit | Revolving Credit Facility | ||||||
Line of credit facility outstanding | 302 | [6],[7] | 70 | |||
Line of credit facility fair value | [3] | 302 | 70 | |||
Securitization obligations | ||||||
Securitization obligations outstanding | 184 | 194 | ||||
Securitization obligations fair value | [3] | $ 184 | $ 194 | |||
[1] | Not included in this table is the Company's Unsecured Letter of Credit Facility which had a capacity of $74 million with $66 million utilized at a weighted average rate of 3.24% at March 31, 2018. | |||||
[2] | The Term Loan B provides for quarterly amortization payments totaling 1% per annum of the original principal amount. The interest rate with respect to term loans under the Term Loan B is based on, at the Company’s option, (a) adjusted LIBOR plus 2.25% (with a LIBOR floor of 0.75%) or (b) ABR plus 1.25% (with an ABR floor of 1.75%). | |||||
[3] | (a)The fair value of the Company's indebtedness is categorized as Level II. | |||||
[4] | The Term Loan A provides for quarterly amortization payments, which commence on June 30, 2018, totaling per annum 2.5%, 2.5%, 5.0%, 7.5% and 10.0% of the original principal amount of the Term Loan A, with the last amortization payment to be made on February 8, 2023. The interest rates with respect to term loans under the Term Loan A are based on, at the Company's option, (a) adjusted LIBOR plus an additional margin or (b) ABR plus an additional margin, in each case subject to adjustment based on the then current senior secured leverage ratio. Based on the previous quarter senior secured leverage ratio, the LIBOR margin was 2.00% and the ABR margin was 1.00% for the three months ended March 31, 2018. | |||||
[5] | Available capacity is subject to maintaining sufficient relocation related assets to collateralize these securitization obligations. | |||||
[6] | As of March 31, 2018, the Company had $1,400 million of borrowing capacity under its Revolving Credit Facility, leaving $1,098 million of available capacity. The Revolving Credit Facility expires in February 2023, but is classified on the balance sheet as current due to the revolving nature of the facility. On May 1, 2018, the Company had $372 million in outstanding borrowings under the Revolving Credit Facility, leaving $1,028 million of available capacity. | |||||
[7] | Interest rates with respect to revolving loans under the Senior Secured Credit Facility at March 31, 2018 were based on, at the Company's option, (a) adjusted London Interbank Offering Rate ("LIBOR") plus an additional margin or (b) JP Morgan Chase Bank, N.A.'s prime rate ("ABR") plus an additional margin, in each case subject to adjustment based on the then current senior secured leverage ratio. Based on the previous quarter senior secured leverage ratio, the LIBOR margin was 2.00% and the ABR margin was 1.00% for the three months ended March 31, 2018. |
Basis Of Presentation Equity Me
Basis Of Presentation Equity Method Investments (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2018 | Mar. 31, 2017 | Dec. 31, 2017 | |
Schedule of Equity Method Investments [Line Items] | |||
Carrying value of equity method investments | $ 55 | $ 74 | |
Proceeds from investments in unconsolidated entities | 19 | $ 0 | |
Equity losses from equity method investment | 4 | 3 | |
Dividends received from unconsolidated entities | 1 | 1 | |
Payments to Acquire Equity Method Investments | 4 | $ 3 | |
Amortization of Intangible Assets related to GRA Acquisition | |||
Schedule of Equity Method Investments [Line Items] | |||
Equity losses from equity method investment | 2 | ||
PHH Home Loans | |||
Schedule of Equity Method Investments [Line Items] | |||
Carrying value of equity method investments | 19 | ||
Guaranteed Rate Affinity | |||
Schedule of Equity Method Investments [Line Items] | |||
Carrying value of equity method investments | $ 47 | $ 48 |
Basis Of Presentation Income Ta
Basis Of Presentation Income Taxes (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2018 | Mar. 31, 2017 | ||
Income Tax Disclosure [Abstract] | |||
Income tax benefit | $ (19) | [1] | $ (9) |
[1] | Includes the elimination of transactions between segments. |
Basis Of Presentation Derivativ
Basis Of Presentation Derivative Instruments (Details) - USD ($) $ in Millions | 3 Months Ended | |||
Mar. 31, 2018 | Mar. 31, 2017 | Feb. 10, 2018 | Dec. 31, 2017 | |
Foreign Exchange Contract | ||||
Derivative [Line Items] | ||||
Fair value of derivative instrument | $ 1 | |||
Notional amount of derivative instrument | 26 | $ 25 | ||
Foreign Exchange Contract | Maximum | ||||
Derivative [Line Items] | ||||
Fair value of derivative instrument | 1 | |||
Interest Rate Swap | ||||
Derivative [Line Items] | ||||
Notional amount of derivative instrument | 1,050 | |||
Interest Rate Swap | Not Designated as Hedging Instrument | Interest Expense | ||||
Derivative [Line Items] | ||||
Gain Recognized on Derivatives | (12) | $ (1) | ||
Interest Rate Swap | Not Designated as Hedging Instrument | Other Non-Current Assets | ||||
Derivative [Line Items] | ||||
Derivative Asset, Fair Value, Gross Asset | 9 | 0 | ||
Interest Rate Swap | Not Designated as Hedging Instrument | Other Current and Non-Current Liabilities | ||||
Derivative [Line Items] | ||||
Fair value of interest rate swap contracts | 6 | $ 13 | ||
Interest Rate Swap | July 2012 and January 2013 | ||||
Derivative [Line Items] | ||||
Notional amount of derivative instrument | $ 425 | |||
Interest Rate Swap | August 2015 | ||||
Derivative [Line Items] | ||||
Notional amount of derivative instrument | 600 | |||
Interest Rate Swap | November 2017 | ||||
Derivative [Line Items] | ||||
Notional amount of derivative instrument | $ 450 |
Basis Of Presentation Restricte
Basis Of Presentation Restricted Cash (Details) - USD ($) $ in Millions | Mar. 31, 2018 | Dec. 31, 2017 |
Cash and Cash Equivalents [Abstract] | ||
Restricted cash | $ 6 | $ 7 |
Basis Of Presentation Supplemen
Basis Of Presentation Supplemental Cash Flow Info (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | |
Supplemental Cash Flow Information [Abstract] | ||
Capital lease additions | $ 4 | $ 5 |
Basis Of Presentation Stock-Bas
Basis Of Presentation Stock-Based Compensation (Details) shares in Millions | 3 Months Ended |
Mar. 31, 2018$ / sharesshares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
RSUs and PSUs shares awarded subject to approval of the Amended and Restated Long-Term Incentive Plan | 0.8 |
Options | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Options Granted in Period | 0.4 |
Options Granted in Period, Weighted Average Exercise Price | $ / shares | $ 25.35 |
Restricted Stock Units (RSUs) | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
RSUs Granted in Period | 1.1 |
RSUs Granted in Period, Weighted Average Grant Date Fair Value | $ / shares | $ 25.45 |
Basis Of Presentation Stock Rep
Basis Of Presentation Stock Repurchases (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | 25 Months Ended | |||
Mar. 31, 2018 | Mar. 31, 2018 | Feb. 26, 2018 | Feb. 23, 2017 | Feb. 24, 2016 | |
Stock Repurchases [Line Items] | |||||
Shares Repurchased and Retired During Period, Shares | 3.7 | 20.2 | |||
Shares Repurchased and Retired During Period, Value | $ 99 | ||||
Weighted Average Market Price of Shares Repurchased and Retired During Period | $ 26.58 | $ 28.36 | |||
Stock Repurchase Program, Remaining Authorized Repurchase Amount | $ 351 | $ 351 | |||
2016 Stock Repurchase Plan | |||||
Stock Repurchases [Line Items] | |||||
Shares Repurchased and Retired During Period, Value | 275 | ||||
2017 Stock Repurchase Plan | |||||
Stock Repurchases [Line Items] | |||||
Shares Repurchased and Retired During Period, Value | $ 299 | ||||
Maximum | 2016 Stock Repurchase Plan | |||||
Stock Repurchases [Line Items] | |||||
Shares Authorized under Stock Repurchase Program, | $ 275 | ||||
Maximum | 2017 Stock Repurchase Plan | |||||
Stock Repurchases [Line Items] | |||||
Shares Authorized under Stock Repurchase Program, | $ 300 | ||||
Maximum | 2018 Stock Repurchase Plan | |||||
Stock Repurchases [Line Items] | |||||
Shares Authorized under Stock Repurchase Program, | $ 350 |
Basis Of Presentation Dividend
Basis Of Presentation Dividend Policy (Details) - $ / shares | 1 Months Ended | 3 Months Ended | |
Aug. 31, 2016 | Mar. 31, 2018 | Mar. 31, 2017 | |
Dividend Policy [Abstract] | |||
Dividends declared per share | $ 0.09 | ||
Cash dividends paid per share | $ 0.09 | $ 0.09 |
Basis Of Presentation New Accou
Basis Of Presentation New Accounting Pronouncements (Details) $ in Millions | Jan. 01, 2018USD ($) |
Accounting Standards Update 2018-02 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |
Cumulative Effect of New Accounting Principle in Period of Adoption | $ 9 |
Revenue Recognition Revenue R36
Revenue Recognition Revenue Recognition - Adoption of the New Revenue Standard (Details) - USD ($) $ in Millions | Mar. 31, 2018 | Jan. 01, 2018 | Dec. 31, 2017 | |
Cumulative Effect of New Accounting Pronouncements[Abstract] | ||||
Trade receivables | $ 163 | $ 154 | $ 153 | |
Other current assets | 159 | 181 | 179 | |
Total current assets | 760 | 792 | 789 | |
Other non-current assets | 271 | 245 | 222 | |
Assets | 7,325 | 7,363 | 7,337 | |
Accrued expenses and other current liabilities | 426 | 480 | 478 | |
Total current liabilities | 1,081 | 957 | 955 | |
Deferred income taxes | 291 | 319 | 327 | |
Other non-current liabilities | 262 | 266 | 212 | |
Total liabilities | 4,897 | 4,763 | 4,715 | |
Accumulated deficit | (2,711) | (2,631) | ||
Accumulated other comprehensive loss | (44) | (37) | ||
Total stockholders' equity | 2,425 | 2,596 | 2,618 | |
Total equity | 2,428 | 2,600 | 2,622 | |
Total liabilities and equity | 7,325 | 7,363 | $ 7,337 | |
Accounting Standards Update 2014-09 | ||||
Cumulative Effect of New Accounting Pronouncements[Abstract] | ||||
Cumulative Effect of New Accounting Principle in Period of Adoption | $ (22) | |||
Accounting Standards Update 2018-02 | ||||
Cumulative Effect of New Accounting Pronouncements[Abstract] | ||||
Accumulated deficit | [1] | (2,622) | ||
Accumulated other comprehensive loss | [1] | (46) | ||
Cumulative Effect of New Accounting Principle in Period of Adoption | 9 | |||
Accounting Standards Update 2018-02 and 2014-09 | ||||
Cumulative Effect of New Accounting Pronouncements[Abstract] | ||||
Accumulated deficit | [1] | (2,644) | ||
Accumulated other comprehensive loss | [1] | (46) | ||
Trade Accounts Receivable | Accounting Standards Update 2014-09 | ||||
Cumulative Effect of New Accounting Pronouncements[Abstract] | ||||
Adjustments due to the adoption of the new revenue standard | 1 | |||
Other Current Assets | Accounting Standards Update 2014-09 | ||||
Cumulative Effect of New Accounting Pronouncements[Abstract] | ||||
Adjustments due to the adoption of the new revenue standard | 2 | |||
Current Assets | Accounting Standards Update 2014-09 | ||||
Cumulative Effect of New Accounting Pronouncements[Abstract] | ||||
Adjustments due to the adoption of the new revenue standard | 3 | |||
Other Non-Current Assets | Accounting Standards Update 2014-09 | ||||
Cumulative Effect of New Accounting Pronouncements[Abstract] | ||||
Adjustments due to the adoption of the new revenue standard | 23 | |||
Assets, Total | Accounting Standards Update 2014-09 | ||||
Cumulative Effect of New Accounting Pronouncements[Abstract] | ||||
Adjustments due to the adoption of the new revenue standard | 26 | |||
Accounts Payable and Accrued Liabilities | Accounting Standards Update 2014-09 | ||||
Cumulative Effect of New Accounting Pronouncements[Abstract] | ||||
Adjustments due to the adoption of the new revenue standard | 2 | |||
Current Liabilities | Accounting Standards Update 2014-09 | ||||
Cumulative Effect of New Accounting Pronouncements[Abstract] | ||||
Adjustments due to the adoption of the new revenue standard | 2 | |||
Deferred Income Tax Charge | Accounting Standards Update 2014-09 | ||||
Cumulative Effect of New Accounting Pronouncements[Abstract] | ||||
Adjustments due to the adoption of the new revenue standard | (8) | |||
Other Non-Current Liabilities | Accounting Standards Update 2014-09 | ||||
Cumulative Effect of New Accounting Pronouncements[Abstract] | ||||
Adjustments due to the adoption of the new revenue standard | 54 | |||
Liabilities, Total | Accounting Standards Update 2014-09 | ||||
Cumulative Effect of New Accounting Pronouncements[Abstract] | ||||
Adjustments due to the adoption of the new revenue standard | 48 | |||
Retained Earnings | Accounting Standards Update 2014-09 | ||||
Cumulative Effect of New Accounting Pronouncements[Abstract] | ||||
Adjustments due to the adoption of the new revenue standard | [1] | (22) | ||
AOCI Attributable to Parent | Accounting Standards Update 2014-09 | ||||
Cumulative Effect of New Accounting Pronouncements[Abstract] | ||||
Adjustments due to the adoption of the new revenue standard | [1] | 0 | ||
Stockholders' Equity, Total | Accounting Standards Update 2014-09 | ||||
Cumulative Effect of New Accounting Pronouncements[Abstract] | ||||
Adjustments due to the adoption of the new revenue standard | (22) | |||
Liabilities and Equity, Total | Accounting Standards Update 2014-09 | ||||
Cumulative Effect of New Accounting Pronouncements[Abstract] | ||||
Adjustments due to the adoption of the new revenue standard | $ 26 | |||
[1] | Beginning balances have been adjusted for the adoption of the accounting standard update on stranded tax effects related to the 2017 Tax Act which resulted in a debit to Accumulated other comprehensive loss and a credit to Accumulated deficit of $9 million. See Note 1, "Basis of Presentation" in the "Recently Adopted Accounting Pronouncements" section for additional information. |
Revenue Recognition Revenue R37
Revenue Recognition Revenue Recognition - Disaggregation of Revenue (Details) - USD ($) $ in Millions | 3 Months Ended | |||
Mar. 31, 2018 | Mar. 31, 2017 | |||
Disaggregation of Revenue [Line Items] | ||||
Gross commission income | [1] | $ 902 | $ 881 | [2] |
Service revenue | [3] | 197 | 194 | [2] |
Franchise fees | [4] | 79 | 75 | [2] |
Other | [5] | 51 | 53 | [2] |
Revenues | [6],[7] | $ 1,229 | $ 1,203 | [2] |
Percentage of Total Revenue from Franchisor Owned Outlets | 74.00% | 74.00% | ||
Percentage of Total Revenue from Sales Revenue, Services, Net | 16.00% | 16.00% | ||
Percentage of Franchise Revenue | 6.00% | 6.00% | ||
Percentage of Other Real Estate Revenue | 4.00% | 4.00% | ||
Real Estate Franchise Services | ||||
Disaggregation of Revenue [Line Items] | ||||
Gross commission income | [1] | $ 0 | $ 0 | [2] |
Service revenue | [3] | 0 | 0 | [2] |
Franchise fees | [4] | 139 | 134 | [2] |
Other | [5] | 37 | 36 | [2] |
Revenues | [6],[7] | 176 | 170 | [2] |
Company Owned Real Estate Brokerage Services | ||||
Disaggregation of Revenue [Line Items] | ||||
Gross commission income | [1] | 902 | 881 | [2] |
Service revenue | [3] | 2 | 2 | [2] |
Franchise fees | [4] | 0 | 0 | [2] |
Other | [5] | 13 | 14 | [2] |
Revenues | [6],[7] | 917 | 897 | [2] |
Relocation Services | ||||
Disaggregation of Revenue [Line Items] | ||||
Gross commission income | [1] | 0 | 0 | [2] |
Service revenue | [3] | 78 | 76 | [2] |
Franchise fees | [4] | 0 | 0 | [2] |
Other | [5] | 1 | 1 | [2] |
Revenues | [6],[7] | $ 79 | $ 77 | [2] |
Percentage of Total Revenue from Sales Revenue, Services, Net | 6.00% | 6.00% | ||
Title and Settlement Services | ||||
Disaggregation of Revenue [Line Items] | ||||
Gross commission income | [1] | $ 0 | $ 0 | [2] |
Service revenue | [3] | 117 | 116 | [2] |
Franchise fees | [4] | 0 | 0 | [2] |
Other | [5] | 3 | 4 | [2] |
Revenues | [6],[7] | $ 120 | $ 120 | [2] |
Percentage of Total Revenue from Sales Revenue, Services, Net | 10.00% | 10.00% | ||
Corporate and Other | ||||
Disaggregation of Revenue [Line Items] | ||||
Gross commission income | [1] | $ 0 | $ 0 | [2] |
Service revenue | [3] | 0 | 0 | [2] |
Franchise fees | [4] | (60) | (59) | [2] |
Other | [5] | (3) | (2) | [2] |
Revenues | [6],[7],[8] | $ (63) | $ (61) | [2] |
[1] | During both the three months ended March 31, 2018 and March 31, 2017, approximately 74% of the Company's total net revenues, related to gross commission income at the Company Owned Brokerage Services segment which is recognized at a point in time at the closing of a homesale transaction. | |||
[2] | Prior period amounts have not been adjusted under the modified retrospective method. | |||
[3] | During both the three months ended March 31, 2018 and March 31, 2017, approximately 16% of the Company's total net revenues related to service fees primarily consisting of title and escrow fees at the Title and Settlement Services segment (10%), which are recognized at a point in time at the closing of a homesale transaction, and relocation fees at the Relocation Services segment (6%), which are recognized as revenue when or as the related performance obligation is satisfied, which is dependent on the type of service performed. Relocation fees at the Relocation Services segment primarily include: (i) referral fees which are recognized at a point in time at the closing of a homesale transaction, (ii) outsourcing fees, which are management fees charged to clients frequently related to a bundle of relocation services performed and are recognized over the average time period to complete a move, and (iii) referral commissions from third party suppliers which are recognized at the time of the completion of the related service. | |||
[4] | During both the three months ended March 31, 2018 and March 31, 2017, approximately 6% of the Company's total net revenues related to franchise fees at the Real Estate Franchise Services segment, primarily domestic royalties, which are recognized at a point in time when the underlying franchisee revenue is earned (upon close of the homesale transaction). | |||
[5] | During both the three months ended March 31, 2018 and March 31, 2017, approximately 4% of the Company's total net revenues related to other revenue which comprised of brand marketing funds received at the Real Estate Franchise Services segment from franchisees and other miscellaneous revenues across all of the business segments. | |||
[6] | Revenues for the Relocation Services segment include intercompany referral commissions paid by the Company Owned Real Estate Brokerage Services segment of $8 million for both the three months ended March 31, 2018 and 2017. Such amounts are recorded as contra-revenues by the Company Owned Real Estate Brokerage Services segment. There are no other material intersegment transactions. | |||
[7] | Transactions between segments are eliminated in consolidation. Revenues for the Real Estate Franchise Services segment include intercompany royalties and marketing fees paid by the Company Owned Real Estate Brokerage Services segment of $63 million and $61 million for the three months ended March 31, 2018 and 2017, respectively. Such amounts are eliminated through the Corporate and Other line. | |||
[8] | Includes the elimination of transactions between segments. |
Revenue Recognition Revenue R38
Revenue Recognition Revenue Recognition - Deferred Revenue (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2018 | Jan. 01, 2018 | ||
Deferred Revenue Arrangement [Line Items] | |||
Deferred Revenue | $ 109 | $ 114 | |
Additions during the period | 52 | ||
Deferred Revenue, Revenue Recognized | (57) | ||
Movement in Deferred Revenue [Roll Forward] | |||
Additions during the period | 52 | ||
Recognized as Revenue during the period | (57) | ||
Ending Balance at March 31, 2018 | 109 | ||
Real Estate Franchise Services | |||
Deferred Revenue Arrangement [Line Items] | |||
Deferred Revenue | [1] | 75 | 79 |
Additions during the period | [1] | 30 | |
Deferred Revenue, Revenue Recognized | [1] | (34) | |
Movement in Deferred Revenue [Roll Forward] | |||
Additions during the period | [1] | 30 | |
Recognized as Revenue during the period | [1] | (34) | |
Ending Balance at March 31, 2018 | [1] | 75 | |
Real Estate Franchise Services | Brand Marketing Fees | |||
Deferred Revenue Arrangement [Line Items] | |||
Deferred Revenue | 9 | 13 | |
Movement in Deferred Revenue [Roll Forward] | |||
Ending Balance at March 31, 2018 | 9 | ||
Real Estate Franchise Services | Area Development Fees | |||
Deferred Revenue Arrangement [Line Items] | |||
Deferred Revenue | 57 | 58 | |
Additions during the period | [1] | 0 | |
Movement in Deferred Revenue [Roll Forward] | |||
Additions during the period | [1] | 0 | |
Ending Balance at March 31, 2018 | 57 | ||
Real Estate Franchise Services | Various Other Revenue Contracts | |||
Deferred Revenue Arrangement [Line Items] | |||
Deferred Revenue | 9 | 8 | |
Movement in Deferred Revenue [Roll Forward] | |||
Ending Balance at March 31, 2018 | 9 | ||
Company Owned Real Estate Brokerage Services | |||
Deferred Revenue Arrangement [Line Items] | |||
Deferred Revenue | 16 | 17 | |
Additions during the period | 3 | ||
Deferred Revenue, Revenue Recognized | (4) | ||
Movement in Deferred Revenue [Roll Forward] | |||
Additions during the period | 3 | ||
Recognized as Revenue during the period | (4) | ||
Ending Balance at March 31, 2018 | 16 | ||
Company Owned Real Estate Brokerage Services | New Development Business | |||
Deferred Revenue Arrangement [Line Items] | |||
Deferred Revenue | 10 | 10 | |
Additions during the period | 2 | ||
Deferred Revenue, Revenue Recognized | (2) | ||
Movement in Deferred Revenue [Roll Forward] | |||
Additions during the period | 2 | ||
Recognized as Revenue during the period | (2) | ||
Ending Balance at March 31, 2018 | 10 | ||
Relocation Services | |||
Deferred Revenue Arrangement [Line Items] | |||
Deferred Revenue | 18 | 18 | |
Additions during the period | 19 | ||
Deferred Revenue, Revenue Recognized | (19) | ||
Movement in Deferred Revenue [Roll Forward] | |||
Additions during the period | 19 | ||
Recognized as Revenue during the period | (19) | ||
Ending Balance at March 31, 2018 | 18 | ||
Relocation Services | Outsourcing Management Fees | |||
Deferred Revenue Arrangement [Line Items] | |||
Deferred Revenue | 6 | 5 | |
Additions during the period | 13 | ||
Deferred Revenue, Revenue Recognized | (12) | ||
Movement in Deferred Revenue [Roll Forward] | |||
Additions during the period | 13 | ||
Recognized as Revenue during the period | (12) | ||
Ending Balance at March 31, 2018 | 6 | ||
Relocation Services | Broker Network Fees | |||
Deferred Revenue Arrangement [Line Items] | |||
Deferred Revenue | 6 | $ 8 | |
Deferred Revenue, Revenue Recognized | (3) | ||
Movement in Deferred Revenue [Roll Forward] | |||
Recognized as Revenue during the period | (3) | ||
Ending Balance at March 31, 2018 | $ 6 | ||
Franchise Rights | Real Estate Franchise Services | |||
Deferred Revenue Arrangement [Line Items] | |||
Amortization period | 30 years | ||
International Franchise Rights | Real Estate Franchise Services | |||
Deferred Revenue Arrangement [Line Items] | |||
Amortization period | 25 years | ||
Minimum | Company Owned Real Estate Brokerage Services | |||
Deferred Revenue Arrangement [Line Items] | |||
New Development Period | 18 months | ||
Minimum | Relocation Services | |||
Deferred Revenue Arrangement [Line Items] | |||
Average Length of a Move | 3 months | ||
Maximum | Company Owned Real Estate Brokerage Services | |||
Deferred Revenue Arrangement [Line Items] | |||
New Development Period | 24 months | ||
Maximum | Relocation Services | |||
Deferred Revenue Arrangement [Line Items] | |||
Average Length of a Move | 6 months | ||
[1] | (a)Revenues recognized include intercompany marketing fees paid by the Company Owned Real Estate Brokerage Services segment. |
Intangible Assets - Goodwill (D
Intangible Assets - Goodwill (Details) $ in Millions | 3 Months Ended | ||
Mar. 31, 2018USD ($)real_estate_brokerage_operations | Dec. 31, 2017USD ($) | ||
Goodwill [Line Items] | |||
Gross goodwill as of December 31, 2017 | $ 5,496 | ||
Accumulated impairment losses | (1,786) | ||
Balance at December 31, 2017 | $ 3,710 | 3,710 | |
Goodwill [Roll Forward] | |||
Balance at December 31, 2017 | 3,710 | ||
Goodwill acquired (a) | [1] | 1 | |
Balance at March 31, 2018 | $ 3,711 | ||
Company Owned Real Estate Brokerage Services | |||
Goodwill [Roll Forward] | |||
Number of Businesses Acquired | real_estate_brokerage_operations | 1 | ||
Real Estate Franchise Services | |||
Goodwill [Line Items] | |||
Gross goodwill as of December 31, 2017 | 3,315 | ||
Accumulated impairment losses | (1,023) | ||
Balance at December 31, 2017 | $ 2,292 | 2,292 | |
Goodwill [Roll Forward] | |||
Balance at December 31, 2017 | 2,292 | ||
Goodwill acquired (a) | [1] | 0 | |
Balance at March 31, 2018 | 2,292 | ||
Company Owned Real Estate Brokerage Services | |||
Goodwill [Line Items] | |||
Gross goodwill as of December 31, 2017 | 1,062 | ||
Accumulated impairment losses | (158) | ||
Balance at December 31, 2017 | 904 | 904 | |
Goodwill [Roll Forward] | |||
Balance at December 31, 2017 | 904 | ||
Goodwill acquired (a) | [1] | 1 | |
Balance at March 31, 2018 | 905 | ||
Relocation Services | |||
Goodwill [Line Items] | |||
Gross goodwill as of December 31, 2017 | 641 | ||
Accumulated impairment losses | (281) | ||
Balance at December 31, 2017 | 360 | 360 | |
Goodwill [Roll Forward] | |||
Balance at December 31, 2017 | 360 | ||
Goodwill acquired (a) | [1] | 0 | |
Balance at March 31, 2018 | 360 | ||
Title and Settlement Services | |||
Goodwill [Line Items] | |||
Gross goodwill as of December 31, 2017 | 478 | ||
Accumulated impairment losses | (324) | ||
Balance at December 31, 2017 | 154 | $ 154 | |
Goodwill [Roll Forward] | |||
Balance at December 31, 2017 | 154 | ||
Goodwill acquired (a) | [1] | 0 | |
Balance at March 31, 2018 | $ 154 | ||
[1] | Goodwill acquired during the three months ended March 31, 2018 relates to the acquisition of one real estate brokerage operation. |
Intangible Assets - Intangible
Intangible Assets - Intangible Assets (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2018 | Dec. 31, 2017 | ||
Finite-Lived and Indefinite-Lived Intangible Assets [Line Items] | |||
Carrying amount of total other intangibles | $ 645 | $ 647 | |
Accumulated Amortization | 369 | 363 | |
Net carrying amount of finite-lived and indefinite-lived intangible assets | 276 | 284 | |
Indefinite life—Trademarks (b) | |||
Finite-Lived and Indefinite-Lived Intangible Assets [Line Items] | |||
Gross carrying amount of indefinite-lived intangible assets | [1] | 749 | 749 |
Indefinite life—Title plant shares (e) | |||
Finite-Lived and Indefinite-Lived Intangible Assets [Line Items] | |||
Gross carrying amount of indefinite-lived intangible assets | [2] | 18 | 18 |
Amortizable—Franchise agreements (a) | |||
Finite-Lived and Indefinite-Lived Intangible Assets [Line Items] | |||
Gross carrying amount of finite-lived intangible assets | [3] | 2,019 | 2,019 |
Accumulated Amortization | [3] | 742 | 725 |
Net carrying amount of finite-lived intangible assets | [3] | 1,277 | 1,294 |
Amortizable—License agreements (c) | |||
Finite-Lived and Indefinite-Lived Intangible Assets [Line Items] | |||
Gross carrying amount of finite-lived intangible assets | [4] | 45 | 45 |
Accumulated Amortization | [4] | 10 | 10 |
Net carrying amount of finite-lived intangible assets | [4] | $ 35 | 35 |
Amortization period | 50 years | ||
Amortizable—Customer relationships (d) | |||
Finite-Lived and Indefinite-Lived Intangible Assets [Line Items] | |||
Gross carrying amount of finite-lived intangible assets | [5] | $ 549 | 549 |
Accumulated Amortization | [5] | 341 | 335 |
Net carrying amount of finite-lived intangible assets | [5] | $ 208 | 214 |
Amortizable—Customer relationships (d) | Minimum | |||
Finite-Lived and Indefinite-Lived Intangible Assets [Line Items] | |||
Amortization period | 2 years | ||
Amortizable—Customer relationships (d) | Maximum | |||
Finite-Lived and Indefinite-Lived Intangible Assets [Line Items] | |||
Amortization period | 20 years | ||
Amortizable—Pendings and listings (f) | |||
Finite-Lived and Indefinite-Lived Intangible Assets [Line Items] | |||
Gross carrying amount of finite-lived intangible assets | [6] | $ 0 | 2 |
Accumulated Amortization | [6] | 0 | 1 |
Net carrying amount of finite-lived intangible assets | [6] | $ 0 | 1 |
Amortization period | 5 months | ||
Amortizable—Other (g) | |||
Finite-Lived and Indefinite-Lived Intangible Assets [Line Items] | |||
Gross carrying amount of finite-lived intangible assets | [7] | $ 33 | 33 |
Accumulated Amortization | [7] | 18 | 17 |
Net carrying amount of finite-lived intangible assets | [7] | $ 15 | $ 16 |
Amortizable—Other (g) | Minimum | |||
Finite-Lived and Indefinite-Lived Intangible Assets [Line Items] | |||
Amortization period | 5 years | ||
Amortizable—Other (g) | Maximum | |||
Finite-Lived and Indefinite-Lived Intangible Assets [Line Items] | |||
Amortization period | 10 years | ||
[1] | Primarily relates to the Century 21®, Coldwell Banker®, ERA®, Corcoran®, Coldwell Banker Commercial® and Cartus tradenames, which are expected to generate future cash flows for an indefinite period of time. | ||
[2] | Ownership in a title plant is required to transact title insurance in certain states. The Company expects to generate future cash flows for an indefinite period of time. | ||
[3] | Generally amortized over a period of 30 years. | ||
[4] | Relates to the Sotheby’s International Realty® and Better Homes and Gardens® Real Estate agreements which are being amortized over 50 years (the contractual term of the license agreements). | ||
[5] | Relates to the customer relationships at the Relocation Services segment, the Title and Settlement Services segment and our Company Owned Real Estate Brokerage Services segment. These relationships are being amortized over a period of 2 to 20 years. | ||
[6] | Generally amortized over a period of 5 months. | ||
[7] | Consists of covenants not to compete which are amortized over their contract lives and other intangibles which are generally amortized over periods ranging from 5 to 10 years. |
Intangible Assets - Amortizatio
Intangible Assets - Amortization Expense (Details) $ in Millions | 3 Months Ended | |
Mar. 31, 2018USD ($)Years | Mar. 31, 2017USD ($) | |
Finite-Lived Intangible Assets [Line Items] | ||
Intangible asset amortization expense | $ 25 | $ 26 |
The number of succeeding years for which amortization expense is disclosed | Years | 4 | |
Amortization expense for the remainder of 2018 | $ 73 | |
Amortization expense for Year Two | 97 | |
Amortization expense for Year Three | 95 | |
Amortization expense for Year Four | 93 | |
Amortization expense for Year Five | 92 | |
Amortization expense Thereafter | 1,085 | |
Amortizable—Franchise agreements (a) | ||
Finite-Lived Intangible Assets [Line Items] | ||
Intangible asset amortization expense | 17 | 17 |
Amortizable—License agreements (c) | ||
Finite-Lived Intangible Assets [Line Items] | ||
Intangible asset amortization expense | 0 | 0 |
Amortizable—Customer relationships (d) | ||
Finite-Lived Intangible Assets [Line Items] | ||
Intangible asset amortization expense | 6 | 6 |
Amortizable—Pendings and listings (f) | ||
Finite-Lived Intangible Assets [Line Items] | ||
Intangible asset amortization expense | 1 | 1 |
Amortizable—Other (g) | ||
Finite-Lived Intangible Assets [Line Items] | ||
Intangible asset amortization expense | $ 1 | $ 2 |
Accrued Expenses And Other Cu42
Accrued Expenses And Other Current Liabilities (Details) - USD ($) $ in Millions | Mar. 31, 2018 | Jan. 01, 2018 | Dec. 31, 2017 |
Payables and Accruals [Abstract] | |||
Accrued payroll and related employee costs | $ 86 | $ 140 | |
Accrued volume incentives | 30 | 41 | |
Accrued commissions | 34 | 38 | |
Restructuring accruals | 12 | 5 | |
Deferred income | 65 | 68 | |
Accrued interest | 35 | 13 | |
Contingent consideration for acquisitions | 26 | 26 | |
Due to former parent | 18 | 18 | |
Other | 120 | 129 | |
Total accrued expenses and other current liabilities | $ 426 | $ 480 | $ 478 |
Short And Long-Term Debt Schedu
Short And Long-Term Debt Schedule of Total Indebtedness (Details) - USD ($) $ in Millions | Mar. 31, 2018 | Dec. 31, 2017 | ||
Schedule of Long-term and Short-term Debt Instruments [Line Items] | ||||
Outstanding borrowings, long-term debt | [1] | $ 3,779 | ||
Debt, Long-term and Short-term, Combined Amount | 3,595 | $ 3,348 | ||
Securitization obligations | 184 | 194 | ||
Secured Debt | Term Loan B (1) | ||||
Schedule of Long-term and Short-term Debt Instruments [Line Items] | ||||
Outstanding borrowings, long-term debt | [2] | 1,060 | [3] | 1,063 |
Secured Debt | Term Loan A | ||||
Schedule of Long-term and Short-term Debt Instruments [Line Items] | ||||
Outstanding borrowings, long-term debt | [2] | 745 | [4] | 390 |
Secured Debt | Term Loan A-1 | ||||
Schedule of Long-term and Short-term Debt Instruments [Line Items] | ||||
Outstanding borrowings, long-term debt | [5] | 0 | 339 | |
Senior Notes | 4.50% Senior Notes | ||||
Schedule of Long-term and Short-term Debt Instruments [Line Items] | ||||
Outstanding borrowings, long-term debt | 445 | 444 | ||
Senior Notes | 5.25% Senior Notes | ||||
Schedule of Long-term and Short-term Debt Instruments [Line Items] | ||||
Outstanding borrowings, long-term debt | 546 | 546 | ||
Senior Notes | 4.875% Senior Notes | ||||
Schedule of Long-term and Short-term Debt Instruments [Line Items] | ||||
Outstanding borrowings, long-term debt | 497 | 496 | ||
Line of Credit | Revolving Credit Facility | ||||
Schedule of Long-term and Short-term Debt Instruments [Line Items] | ||||
Line of credit facility outstanding | 302 | [6],[7] | 70 | |
Securitization obligations | ||||
Schedule of Long-term and Short-term Debt Instruments [Line Items] | ||||
Securitization obligations | 184 | 194 | ||
Securitization obligations | Apple Ridge Funding LLC | ||||
Schedule of Long-term and Short-term Debt Instruments [Line Items] | ||||
Securitization obligations | 170 | [5],[8] | 181 | |
Securitization obligations | Cartus Financing Limited | ||||
Schedule of Long-term and Short-term Debt Instruments [Line Items] | ||||
Securitization obligations | $ 14 | [5],[9] | $ 13 | |
[1] | Not included in this table is the Company's Unsecured Letter of Credit Facility which had a capacity of $74 million with $66 million utilized at a weighted average rate of 3.24% at March 31, 2018. | |||
[2] | As of March 31, 2018, after giving effect to the February 2018 refinancing transactions discussed in this Note 5 under the headings "Senior Secured Credit Facility" and "Term Loan A Facility." | |||
[3] | The Term Loan B provides for quarterly amortization payments totaling 1% per annum of the original principal amount. The interest rate with respect to term loans under the Term Loan B is based on, at the Company’s option, (a) adjusted LIBOR plus 2.25% (with a LIBOR floor of 0.75%) or (b) ABR plus 1.25% (with an ABR floor of 1.75%). | |||
[4] | The Term Loan A provides for quarterly amortization payments, which commence on June 30, 2018, totaling per annum 2.5%, 2.5%, 5.0%, 7.5% and 10.0% of the original principal amount of the Term Loan A, with the last amortization payment to be made on February 8, 2023. The interest rates with respect to term loans under the Term Loan A are based on, at the Company's option, (a) adjusted LIBOR plus an additional margin or (b) ABR plus an additional margin, in each case subject to adjustment based on the then current senior secured leverage ratio. Based on the previous quarter senior secured leverage ratio, the LIBOR margin was 2.00% and the ABR margin was 1.00% for the three months ended March 31, 2018. | |||
[5] | Available capacity is subject to maintaining sufficient relocation related assets to collateralize these securitization obligations. | |||
[6] | As of March 31, 2018, the Company had $1,400 million of borrowing capacity under its Revolving Credit Facility, leaving $1,098 million of available capacity. The Revolving Credit Facility expires in February 2023, but is classified on the balance sheet as current due to the revolving nature of the facility. On May 1, 2018, the Company had $372 million in outstanding borrowings under the Revolving Credit Facility, leaving $1,028 million of available capacity. | |||
[7] | Interest rates with respect to revolving loans under the Senior Secured Credit Facility at March 31, 2018 were based on, at the Company's option, (a) adjusted London Interbank Offering Rate ("LIBOR") plus an additional margin or (b) JP Morgan Chase Bank, N.A.'s prime rate ("ABR") plus an additional margin, in each case subject to adjustment based on the then current senior secured leverage ratio. Based on the previous quarter senior secured leverage ratio, the LIBOR margin was 2.00% and the ABR margin was 1.00% for the three months ended March 31, 2018. | |||
[8] | As of March 31, 2018, the Company had $250 million of borrowing capacity under the Apple Ridge Funding LLC securitization program leaving $80 million of available capacity. | |||
[9] | Consists of a £10 million revolving loan facility and a £5 million working capital facility. As of March 31, 2018, the Company had $21 million of borrowing capacity under the Cartus Financing Limited securitization program leaving $7 million of available capacity. |
Short And Long-Term Debt Sche44
Short And Long-Term Debt Schedule of Debt (Details) £ in Millions, $ in Millions | 3 Months Ended | |||||||
Mar. 31, 2018GBP (£) | May 01, 2018USD ($) | Mar. 31, 2018USD ($) | Feb. 28, 2018USD ($) | Dec. 31, 2017USD ($) | Jan. 31, 2017USD ($) | |||
Principal Amount | ||||||||
Long-term debt principal amount | [1] | $ 3,813 | ||||||
Securitization obligations outstanding | 184 | $ 194 | ||||||
Unamortized Discount and Debt Issuance Costs | ||||||||
Debt Instrument, Unamortized Discount (Premium) and Debt Issuance Costs, Net | [1] | 34 | ||||||
Net Amount | ||||||||
Outstanding borrowings, long-term debt | [1] | 3,779 | ||||||
Securitization obligations outstanding | 184 | 194 | ||||||
Letter of Credit, borrowing capacity | $ 125 | |||||||
LIBOR | ||||||||
Net Amount | ||||||||
Description of variable interest rate basis | LIBOR | |||||||
ABR | ||||||||
Net Amount | ||||||||
Description of variable interest rate basis | ABR | |||||||
Term Loan B (1) | LIBOR | ||||||||
Net Amount | ||||||||
Debt Instrument, Basis Spread on Variable Rate | 2.25% | |||||||
Debt Instrument, Basis Spread on Variable Rate, Floor | 0.75% | 0.75% | ||||||
Term Loan B (1) | ABR | ||||||||
Net Amount | ||||||||
Debt Instrument, Basis Spread on Variable Rate | 1.25% | |||||||
Debt Instrument, Basis Spread on Variable Rate, Floor | 1.75% | 1.75% | ||||||
Unsecured Letter of Credit Facility | ||||||||
Net Amount | ||||||||
Interest Rate | 3.24% | 3.24% | ||||||
Outstanding letters of credit | $ 66 | 69 | ||||||
Letter of Credit, borrowing capacity | 74 | 74 | ||||||
Secured Debt | Term Loan B (1) | ||||||||
Principal Amount | ||||||||
Long-term debt principal amount | 1,077 | [2] | $ 1,080 | 1,083 | ||||
Unamortized Discount and Debt Issuance Costs | ||||||||
Debt Instrument, Unamortized Discount (Premium) and Debt Issuance Costs, Net | [2] | 17 | ||||||
Net Amount | ||||||||
Outstanding borrowings, long-term debt | [3] | $ 1,060 | [2] | 1,063 | ||||
Annual percentage of original principal amount for quarterly amortization payments | 1.00% | 1.00% | ||||||
Secured Debt | Term Loan A | ||||||||
Principal Amount | ||||||||
Long-term debt principal amount | $ 750 | [4] | 750 | 391 | ||||
Unamortized Discount and Debt Issuance Costs | ||||||||
Debt Instrument, Unamortized Discount (Premium) and Debt Issuance Costs, Net | [4] | 5 | ||||||
Net Amount | ||||||||
Outstanding borrowings, long-term debt | [3] | $ 745 | [4] | 390 | ||||
Secured Debt | 2018 | Term Loan A | ||||||||
Net Amount | ||||||||
Annual percentage of original principal amount for quarterly amortization payments | 2.50% | 2.50% | ||||||
Secured Debt | 2019 | Term Loan A | ||||||||
Net Amount | ||||||||
Annual percentage of original principal amount for quarterly amortization payments | 2.50% | 2.50% | ||||||
Secured Debt | 2020 | Term Loan A | ||||||||
Net Amount | ||||||||
Annual percentage of original principal amount for quarterly amortization payments | 5.00% | 5.00% | ||||||
Secured Debt | 2021 | Term Loan A | ||||||||
Net Amount | ||||||||
Annual percentage of original principal amount for quarterly amortization payments | 7.50% | 7.50% | ||||||
Secured Debt | 2022 | Term Loan A | ||||||||
Net Amount | ||||||||
Annual percentage of original principal amount for quarterly amortization payments | 10.00% | 10.00% | ||||||
Secured Debt | Less than 2.50 to 1.00 but greater than or equal to 2.00 to 1.00 | Term Loan A | LIBOR | ||||||||
Net Amount | ||||||||
Debt Instrument, Basis Spread on Variable Rate | 2.00% | |||||||
Secured Debt | Less than 2.50 to 1.00 but greater than or equal to 2.00 to 1.00 | Term Loan A | ABR | ||||||||
Net Amount | ||||||||
Debt Instrument, Basis Spread on Variable Rate | 1.00% | |||||||
Senior Notes | 4.50% Senior Notes | ||||||||
Principal Amount | ||||||||
Long-term debt principal amount | $ 450 | 450 | ||||||
Unamortized Discount and Debt Issuance Costs | ||||||||
Debt Instrument, Unamortized Discount (Premium) and Debt Issuance Costs, Net | 5 | |||||||
Net Amount | ||||||||
Outstanding borrowings, long-term debt | $ 445 | 444 | ||||||
Interest Rate | 4.50% | 4.50% | ||||||
Senior Notes | 5.25% Senior Notes | ||||||||
Principal Amount | ||||||||
Long-term debt principal amount | $ 550 | 550 | ||||||
Unamortized Discount and Debt Issuance Costs | ||||||||
Debt Instrument, Unamortized Discount (Premium) and Debt Issuance Costs, Net | 4 | |||||||
Net Amount | ||||||||
Outstanding borrowings, long-term debt | $ 546 | 546 | ||||||
Interest Rate | 5.25% | 5.25% | ||||||
Senior Notes | 4.875% Senior Notes | ||||||||
Principal Amount | ||||||||
Long-term debt principal amount | $ 500 | 500 | ||||||
Unamortized Discount and Debt Issuance Costs | ||||||||
Debt Instrument, Unamortized Discount (Premium) and Debt Issuance Costs, Net | 3 | |||||||
Net Amount | ||||||||
Outstanding borrowings, long-term debt | $ 497 | 496 | ||||||
Interest Rate | 4.875% | 4.875% | ||||||
Line of Credit | Revolving Credit Facility | ||||||||
Principal Amount | ||||||||
Line of credit facility outstanding | $ 302 | [5],[6] | 70 | |||||
Net Amount | ||||||||
Outstanding borrowings, short-term debt, line of credit facility | 302 | [5],[6] | 70 | |||||
Total capacity, short-term debt, line of credit facility | 1,400 | [5],[6] | $ 1,400 | $ 1,050 | ||||
Line of Credit Facility, Remaining Borrowing Capacity | 1,098 | |||||||
Line of Credit | Less than 2.50 to 1.00 but greater than or equal to 2.00 to 1.00 | Revolving Credit Facility | LIBOR | ||||||||
Net Amount | ||||||||
Debt Instrument, Basis Spread on Variable Rate | 2.00% | |||||||
Line of Credit | Less than 2.50 to 1.00 but greater than or equal to 2.00 to 1.00 | Revolving Credit Facility | ABR | ||||||||
Net Amount | ||||||||
Debt Instrument, Basis Spread on Variable Rate | 1.00% | |||||||
Securitization obligations | ||||||||
Principal Amount | ||||||||
Securitization obligations outstanding | 184 | 194 | ||||||
Net Amount | ||||||||
Securitization obligations outstanding | 184 | 194 | ||||||
Securitization obligations | Apple Ridge Funding LLC | ||||||||
Principal Amount | ||||||||
Securitization obligations outstanding | 170 | [7],[8] | 181 | |||||
Net Amount | ||||||||
Securitization obligations outstanding | 170 | [7],[8] | 181 | |||||
Total capacity, securitization obligations | [4],[8] | 250 | ||||||
Debt Instrument, Unused Borrowing Capacity, Amount | 80 | |||||||
Securitization obligations | Cartus Financing Limited | ||||||||
Principal Amount | ||||||||
Securitization obligations outstanding | 14 | [8],[9] | 13 | |||||
Net Amount | ||||||||
Securitization obligations outstanding | 14 | [8],[9] | $ 13 | |||||
Total capacity, securitization obligations | [4],[8] | 21 | ||||||
Debt Instrument, Unused Borrowing Capacity, Amount | $ 7 | |||||||
Securitization obligations | Revolving Credit Facility | Cartus Financing Limited | ||||||||
Net Amount | ||||||||
Total capacity, securitization obligations | £ | £ 10 | |||||||
Securitization obligations | Working Capital Facility | Cartus Financing Limited | ||||||||
Net Amount | ||||||||
Total capacity, securitization obligations | £ | £ 5 | |||||||
Subsequent Event | Line of Credit | Revolving Credit Facility | ||||||||
Principal Amount | ||||||||
Line of credit facility outstanding | [5],[6] | $ 372 | ||||||
Net Amount | ||||||||
Outstanding borrowings, short-term debt, line of credit facility | [5],[6] | 372 | ||||||
Line of Credit Facility, Remaining Borrowing Capacity | $ 1,028 | |||||||
[1] | Not included in this table is the Company's Unsecured Letter of Credit Facility which had a capacity of $74 million with $66 million utilized at a weighted average rate of 3.24% at March 31, 2018. | |||||||
[2] | The Term Loan B provides for quarterly amortization payments totaling 1% per annum of the original principal amount. The interest rate with respect to term loans under the Term Loan B is based on, at the Company’s option, (a) adjusted LIBOR plus 2.25% (with a LIBOR floor of 0.75%) or (b) ABR plus 1.25% (with an ABR floor of 1.75%). | |||||||
[3] | As of March 31, 2018, after giving effect to the February 2018 refinancing transactions discussed in this Note 5 under the headings "Senior Secured Credit Facility" and "Term Loan A Facility." | |||||||
[4] | The Term Loan A provides for quarterly amortization payments, which commence on June 30, 2018, totaling per annum 2.5%, 2.5%, 5.0%, 7.5% and 10.0% of the original principal amount of the Term Loan A, with the last amortization payment to be made on February 8, 2023. The interest rates with respect to term loans under the Term Loan A are based on, at the Company's option, (a) adjusted LIBOR plus an additional margin or (b) ABR plus an additional margin, in each case subject to adjustment based on the then current senior secured leverage ratio. Based on the previous quarter senior secured leverage ratio, the LIBOR margin was 2.00% and the ABR margin was 1.00% for the three months ended March 31, 2018. | |||||||
[5] | As of March 31, 2018, the Company had $1,400 million of borrowing capacity under its Revolving Credit Facility, leaving $1,098 million of available capacity. The Revolving Credit Facility expires in February 2023, but is classified on the balance sheet as current due to the revolving nature of the facility. On May 1, 2018, the Company had $372 million in outstanding borrowings under the Revolving Credit Facility, leaving $1,028 million of available capacity. | |||||||
[6] | Interest rates with respect to revolving loans under the Senior Secured Credit Facility at March 31, 2018 were based on, at the Company's option, (a) adjusted London Interbank Offering Rate ("LIBOR") plus an additional margin or (b) JP Morgan Chase Bank, N.A.'s prime rate ("ABR") plus an additional margin, in each case subject to adjustment based on the then current senior secured leverage ratio. Based on the previous quarter senior secured leverage ratio, the LIBOR margin was 2.00% and the ABR margin was 1.00% for the three months ended March 31, 2018. | |||||||
[7] | As of March 31, 2018, the Company had $250 million of borrowing capacity under the Apple Ridge Funding LLC securitization program leaving $80 million of available capacity. | |||||||
[8] | Available capacity is subject to maintaining sufficient relocation related assets to collateralize these securitization obligations. | |||||||
[9] | Consists of a £10 million revolving loan facility and a £5 million working capital facility. As of March 31, 2018, the Company had $21 million of borrowing capacity under the Cartus Financing Limited securitization program leaving $7 million of available capacity. |
Short And Long-Term Debt Maturi
Short And Long-Term Debt Maturities Table (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |||
Mar. 31, 2018 | Dec. 31, 2018 | Dec. 31, 2017 | |||
Maturities of Long-term Debt | |||||
Remaining 2018 (a) | [1] | $ 324 | |||
2,019 | 480 | ||||
2,020 | 44 | ||||
2,021 | 613 | ||||
2,022 | $ 81 | ||||
Long-term Debt Maturities, Years Presented | 4 years | ||||
Line of Credit | Revolving Credit Facility | |||||
Maturities of Long-term Debt | |||||
Line of credit facility outstanding | $ 302 | [2],[3] | $ 70 | ||
Scenario, Forecast | Secured Debt | Term Loan A | |||||
Maturities of Long-term Debt | |||||
Debt Instrument, Periodic Payment, Principal | $ 14 | ||||
Scenario, Forecast | Secured Debt | Term Loan B (1) | |||||
Maturities of Long-term Debt | |||||
Debt Instrument, Periodic Payment, Principal | $ 8 | ||||
[1] | The current portion of long-term debt consists of remaining 2018 amortization payments totaling $14 million and $8 million for the Term Loan A and Term Loan B facilities, respectively, as well as $302 million of revolver borrowings under the Revolving Credit Facility which expires in February 2023, but are classified on the balance sheet as current due to the revolving nature of the facility. | ||||
[2] | As of March 31, 2018, the Company had $1,400 million of borrowing capacity under its Revolving Credit Facility, leaving $1,098 million of available capacity. The Revolving Credit Facility expires in February 2023, but is classified on the balance sheet as current due to the revolving nature of the facility. On May 1, 2018, the Company had $372 million in outstanding borrowings under the Revolving Credit Facility, leaving $1,028 million of available capacity. | ||||
[3] | Interest rates with respect to revolving loans under the Senior Secured Credit Facility at March 31, 2018 were based on, at the Company's option, (a) adjusted London Interbank Offering Rate ("LIBOR") plus an additional margin or (b) JP Morgan Chase Bank, N.A.'s prime rate ("ABR") plus an additional margin, in each case subject to adjustment based on the then current senior secured leverage ratio. Based on the previous quarter senior secured leverage ratio, the LIBOR margin was 2.00% and the ABR margin was 1.00% for the three months ended March 31, 2018. |
Short And Long-Term Debt Senior
Short And Long-Term Debt Senior Secured Credit Facility (Details) - USD ($) $ in Millions | 3 Months Ended | |||||||
Mar. 31, 2018 | Feb. 28, 2018 | Dec. 31, 2017 | Jan. 31, 2017 | Jul. 20, 2016 | Mar. 05, 2013 | |||
Debt Instrument [Line Items] | ||||||||
Long-term debt principal amount | [1] | $ 3,813 | ||||||
Letter of Credit, borrowing capacity | $ 125 | |||||||
Additional Credit Facilities | $ 500 | |||||||
Maximum | Required Covenant Ratio to Receive Additional Credit Facilities | ||||||||
Debt Instrument [Line Items] | ||||||||
Senior secured leverage ratio | 3.50 | |||||||
Ratio of Indebtedness to Net Capital Denominator | 1 | |||||||
Maximum | Required Covenant Ratio | ||||||||
Debt Instrument [Line Items] | ||||||||
Senior secured leverage ratio | 4.75 | |||||||
Ratio of Indebtedness to Net Capital Denominator | 1 | |||||||
LIBOR | ||||||||
Debt Instrument [Line Items] | ||||||||
Description of variable interest rate basis | LIBOR | |||||||
ABR | ||||||||
Debt Instrument [Line Items] | ||||||||
Description of variable interest rate basis | ABR | |||||||
Term Loan B (1) | LIBOR | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt Instrument, Basis Spread on Variable Rate | 2.25% | |||||||
Debt Instrument, Basis Spread on Variable Rate, Floor | 0.75% | |||||||
Term Loan B (1) | ABR | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt Instrument, Basis Spread on Variable Rate | 1.25% | |||||||
Debt Instrument, Basis Spread on Variable Rate, Floor | 1.75% | |||||||
Line of Credit | Revolving Credit Facility | ||||||||
Debt Instrument [Line Items] | ||||||||
Line of credit facility borrowing capacity | $ 1,400 | [2],[3] | $ 1,400 | $ 1,050 | ||||
Line of Credit | Revolving Credit Facility | LIBOR | Greater than 3.50 to 1.00 | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt Instrument, Basis Spread on Variable Rate | 2.50% | |||||||
Line of Credit | Revolving Credit Facility | LIBOR | Less than or equal to 3.50 to 1.00 but greater than or equal to 2.50 to 1.00 | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt Instrument, Basis Spread on Variable Rate | 2.25% | |||||||
Line of Credit | Revolving Credit Facility | LIBOR | Less than 2.50 to 1.00 but greater than or equal to 2.00 to 1.00 | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt Instrument, Basis Spread on Variable Rate | 2.00% | |||||||
Line of Credit | Revolving Credit Facility | LIBOR | Less than 2.00 to 1.00 | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt Instrument, Basis Spread on Variable Rate | 1.75% | |||||||
Line of Credit | Revolving Credit Facility | ABR | Greater than 3.50 to 1.00 | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt Instrument, Basis Spread on Variable Rate | 1.50% | |||||||
Line of Credit | Revolving Credit Facility | ABR | Less than or equal to 3.50 to 1.00 but greater than or equal to 2.50 to 1.00 | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt Instrument, Basis Spread on Variable Rate | 1.25% | |||||||
Line of Credit | Revolving Credit Facility | ABR | Less than 2.50 to 1.00 but greater than or equal to 2.00 to 1.00 | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt Instrument, Basis Spread on Variable Rate | 1.00% | |||||||
Line of Credit | Revolving Credit Facility | ABR | Less than 2.00 to 1.00 | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt Instrument, Basis Spread on Variable Rate | 0.75% | |||||||
Secured Debt | Term Loan B (1) | ||||||||
Debt Instrument [Line Items] | ||||||||
Repurchased amount of debt | $ 1,100 | |||||||
Long-term debt principal amount | $ 1,077 | [4] | $ 1,080 | $ 1,083 | ||||
Annual percentage of original principal amount for quarterly amortization payments | 1.00% | |||||||
[1] | Not included in this table is the Company's Unsecured Letter of Credit Facility which had a capacity of $74 million with $66 million utilized at a weighted average rate of 3.24% at March 31, 2018. | |||||||
[2] | As of March 31, 2018, the Company had $1,400 million of borrowing capacity under its Revolving Credit Facility, leaving $1,098 million of available capacity. The Revolving Credit Facility expires in February 2023, but is classified on the balance sheet as current due to the revolving nature of the facility. On May 1, 2018, the Company had $372 million in outstanding borrowings under the Revolving Credit Facility, leaving $1,028 million of available capacity. | |||||||
[3] | Interest rates with respect to revolving loans under the Senior Secured Credit Facility at March 31, 2018 were based on, at the Company's option, (a) adjusted London Interbank Offering Rate ("LIBOR") plus an additional margin or (b) JP Morgan Chase Bank, N.A.'s prime rate ("ABR") plus an additional margin, in each case subject to adjustment based on the then current senior secured leverage ratio. Based on the previous quarter senior secured leverage ratio, the LIBOR margin was 2.00% and the ABR margin was 1.00% for the three months ended March 31, 2018. | |||||||
[4] | The Term Loan B provides for quarterly amortization payments totaling 1% per annum of the original principal amount. The interest rate with respect to term loans under the Term Loan B is based on, at the Company’s option, (a) adjusted LIBOR plus 2.25% (with a LIBOR floor of 0.75%) or (b) ABR plus 1.25% (with an ABR floor of 1.75%). |
Short And Long-Term Debt Term L
Short And Long-Term Debt Term Loan A Facility (Details) - USD ($) $ in Millions | 3 Months Ended | ||||||||
Mar. 31, 2018 | Feb. 28, 2018 | Dec. 31, 2017 | Jul. 20, 2016 | Oct. 23, 2015 | Mar. 05, 2013 | ||||
Debt Instrument [Line Items] | |||||||||
Long-term debt principal amount | [1] | $ 3,813 | |||||||
Additional Credit Facilities | $ 500 | ||||||||
Required Covenant Ratio to Receive Additional Credit Facilities | Maximum | |||||||||
Debt Instrument [Line Items] | |||||||||
Ratio of Indebtedness to Net Capital | 3.50 | ||||||||
Ratio of Indebtedness to Net Capital Denominator | 1 | ||||||||
Term Loan A | Secured Debt | |||||||||
Debt Instrument [Line Items] | |||||||||
Repurchased amount of debt | $ 435 | ||||||||
Long-term debt principal amount | $ 750 | [2] | $ 750 | $ 391 | |||||
Term Loan A | Secured Debt | Greater than 3.50 to 1.00 | LIBOR | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt Instrument, Basis Spread on Variable Rate | 2.50% | ||||||||
Term Loan A | Secured Debt | Greater than 3.50 to 1.00 | ABR | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt Instrument, Basis Spread on Variable Rate | 1.50% | ||||||||
Term Loan A | Secured Debt | Less than or equal to 3.50 to 1.00 but greater than or equal to 2.50 to 1.00 | LIBOR | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt Instrument, Basis Spread on Variable Rate | 2.25% | ||||||||
Term Loan A | Secured Debt | Less than or equal to 3.50 to 1.00 but greater than or equal to 2.50 to 1.00 | ABR | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt Instrument, Basis Spread on Variable Rate | 1.25% | ||||||||
Term Loan A | Secured Debt | Less than 2.50 to 1.00 but greater than or equal to 2.00 to 1.00 | LIBOR | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt Instrument, Basis Spread on Variable Rate | 2.00% | ||||||||
Term Loan A | Secured Debt | Less than 2.50 to 1.00 but greater than or equal to 2.00 to 1.00 | ABR | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt Instrument, Basis Spread on Variable Rate | 1.00% | ||||||||
Term Loan A | Secured Debt | Less than 2.00 to 1.00 | LIBOR | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt Instrument, Basis Spread on Variable Rate | 1.75% | ||||||||
Term Loan A | Secured Debt | Less than 2.00 to 1.00 | ABR | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt Instrument, Basis Spread on Variable Rate | 0.75% | ||||||||
Term Loan A | Secured Debt | 2018 | |||||||||
Debt Instrument [Line Items] | |||||||||
Annual percentage of original principal amount for quarterly amortization payments | 2.50% | ||||||||
Term Loan A | Secured Debt | 2019 | |||||||||
Debt Instrument [Line Items] | |||||||||
Annual percentage of original principal amount for quarterly amortization payments | 2.50% | ||||||||
Term Loan A | Secured Debt | 2020 | |||||||||
Debt Instrument [Line Items] | |||||||||
Annual percentage of original principal amount for quarterly amortization payments | 5.00% | ||||||||
Term Loan A | Secured Debt | 2021 | |||||||||
Debt Instrument [Line Items] | |||||||||
Annual percentage of original principal amount for quarterly amortization payments | 7.50% | ||||||||
Term Loan A | Secured Debt | 2022 | |||||||||
Debt Instrument [Line Items] | |||||||||
Annual percentage of original principal amount for quarterly amortization payments | 10.00% | ||||||||
Term Loan A-1 | Secured Debt | |||||||||
Debt Instrument [Line Items] | |||||||||
Repurchased amount of debt | $ 355 | ||||||||
Long-term debt principal amount | $ 0 | [3] | $ 342 | [2] | |||||
Term Loan A Facility | Secured Debt | |||||||||
Debt Instrument [Line Items] | |||||||||
Additional Credit Facilities | $ 500 | ||||||||
Term Loan A Facility | Secured Debt | Required Covenant Ratio to Receive Additional Credit Facilities | Maximum | |||||||||
Debt Instrument [Line Items] | |||||||||
Ratio of Indebtedness to Net Capital | 350.00% | ||||||||
Ratio of Indebtedness to Net Capital Denominator | 100.00% | ||||||||
[1] | Not included in this table is the Company's Unsecured Letter of Credit Facility which had a capacity of $74 million with $66 million utilized at a weighted average rate of 3.24% at March 31, 2018. | ||||||||
[2] | The Term Loan A provides for quarterly amortization payments, which commence on June 30, 2018, totaling per annum 2.5%, 2.5%, 5.0%, 7.5% and 10.0% of the original principal amount of the Term Loan A, with the last amortization payment to be made on February 8, 2023. The interest rates with respect to term loans under the Term Loan A are based on, at the Company's option, (a) adjusted LIBOR plus an additional margin or (b) ABR plus an additional margin, in each case subject to adjustment based on the then current senior secured leverage ratio. Based on the previous quarter senior secured leverage ratio, the LIBOR margin was 2.00% and the ABR margin was 1.00% for the three months ended March 31, 2018. | ||||||||
[3] | Available capacity is subject to maintaining sufficient relocation related assets to collateralize these securitization obligations. |
Short And Long-Term Debt Unsecu
Short And Long-Term Debt Unsecured Notes (Details) - Senior Notes | Mar. 31, 2018 |
4.50% Senior Notes | |
Debt Instrument [Line Items] | |
Interest Rate | 4.50% |
5.25% Senior Notes | |
Debt Instrument [Line Items] | |
Interest Rate | 5.25% |
4.875% Senior Notes | |
Debt Instrument [Line Items] | |
Interest Rate | 4.875% |
Short And Long-Term Debt Other
Short And Long-Term Debt Other Debt Facilities (Details) - USD ($) $ in Millions | Mar. 31, 2018 | Dec. 31, 2017 |
Line of Credit Facility [Line Items] | ||
Letter of Credit, borrowing capacity | $ 125 | |
Unsecured Letter of Credit Facility | ||
Line of Credit Facility [Line Items] | ||
Letter of Credit, borrowing capacity | 74 | $ 74 |
Outstanding letters of credit | 66 | $ 69 |
Unsecured Letter of Credit Facility | September 2018 | ||
Line of Credit Facility [Line Items] | ||
Letter of Credit, borrowing capacity | 8 | |
Unsecured Letter of Credit Facility | December 2019 | ||
Line of Credit Facility [Line Items] | ||
Letter of Credit, borrowing capacity | $ 66 |
Short And Long-Term Debt Securi
Short And Long-Term Debt Securitization Obligations (Details) £ in Millions, $ in Millions | 3 Months Ended | ||||||
Mar. 31, 2018USD ($) | Mar. 31, 2017USD ($) | Mar. 31, 2018GBP (£) | Mar. 31, 2018USD ($) | Dec. 31, 2017USD ($) | |||
Debt Instrument [Line Items] | |||||||
Securitization obligations | $ 184 | $ 194 | |||||
Securitization obligations | |||||||
Debt Instrument [Line Items] | |||||||
Securitization obligations | 184 | 194 | |||||
Relocation receivables and other related relocation assets that collateralize securitization obligations | $ 239 | 218 | |||||
Interest expense, debt | $ 2 | $ 1 | |||||
Weighted average interest rate, securitization obligations | 3.30% | 3.60% | 3.60% | ||||
Securitization obligations | Apple Ridge Funding LLC | |||||||
Debt Instrument [Line Items] | |||||||
Total capacity, securitization obligations | [1],[2] | $ 250 | |||||
Securitization obligations | 170 | [1],[3] | 181 | ||||
Securitization obligations | Cartus Financing Limited | |||||||
Debt Instrument [Line Items] | |||||||
Total capacity, securitization obligations | [1],[2] | 21 | |||||
Securitization obligations | $ 14 | [1],[4] | $ 13 | ||||
Securitization obligations | Cartus Financing Limited | Revolving Credit Facility | |||||||
Debt Instrument [Line Items] | |||||||
Total capacity, securitization obligations | £ | £ 10 | ||||||
Securitization obligations | Cartus Financing Limited | Working Capital Facility | |||||||
Debt Instrument [Line Items] | |||||||
Total capacity, securitization obligations | £ | £ 5 | ||||||
[1] | Available capacity is subject to maintaining sufficient relocation related assets to collateralize these securitization obligations. | ||||||
[2] | The Term Loan A provides for quarterly amortization payments, which commence on June 30, 2018, totaling per annum 2.5%, 2.5%, 5.0%, 7.5% and 10.0% of the original principal amount of the Term Loan A, with the last amortization payment to be made on February 8, 2023. The interest rates with respect to term loans under the Term Loan A are based on, at the Company's option, (a) adjusted LIBOR plus an additional margin or (b) ABR plus an additional margin, in each case subject to adjustment based on the then current senior secured leverage ratio. Based on the previous quarter senior secured leverage ratio, the LIBOR margin was 2.00% and the ABR margin was 1.00% for the three months ended March 31, 2018. | ||||||
[3] | As of March 31, 2018, the Company had $250 million of borrowing capacity under the Apple Ridge Funding LLC securitization program leaving $80 million of available capacity. | ||||||
[4] | Consists of a £10 million revolving loan facility and a £5 million working capital facility. As of March 31, 2018, the Company had $21 million of borrowing capacity under the Cartus Financing Limited securitization program leaving $7 million of available capacity. |
Short And Long-Term Debt Loss o
Short And Long-Term Debt Loss on the Early Extinguishment of Debt and Write-Off of Financing Costs (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2018 | Mar. 31, 2017 | ||
Debt Disclosure [Abstract] | |||
Loss on the early extinguishment of debt | [1] | $ 7 | $ 4 |
Write off of Deferred Debt Issuance Cost | $ 2 | ||
[1] | Loss on the early extinguishment of debt is recorded in the Corporate and Other segment. |
Restructuring Costs Restructu52
Restructuring Costs Restructuring Costs (Details) - USD ($) $ in Millions | 3 Months Ended | |||
Mar. 31, 2018 | Mar. 31, 2017 | |||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring costs, net | $ 30 | $ 5 | [1] | |
Personnel Related | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring costs, net | [2] | 14 | 5 | |
Facility Related | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring costs, net | [3] | 9 | 0 | |
Internal Use Software Impairment | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring costs, net | [4] | $ 7 | $ 0 | |
[1] | Includes restructuring charges of $2 million in the Real Estate Franchise Services segment, $17 million in the Company Owned Real Estate Brokerage Services segment, $8 million in the Cartus segment, $1 million at Title and Settlement Services segment and $2 million in Corporate and Other for the three months ended March 31, 2018. Includes restructuring charges of $5 million in the Company Owned Real Estate Brokerage Services segment for the three months ended March 31, 2017. | |||
[2] | Personnel-related costs consist of severance costs provided to employees who have been terminated and duplicate payroll costs during transition. | |||
[3] | Facility-related costs consist of costs associated with planned facility closures such as contract termination costs, lease payments, net of applicable sublease income, that will continue to be incurred under the contract for its remaining term without economic benefit to the Company, accelerated depreciation on asset disposals and other facility and employee relocation related costs. | |||
[4] | Internal use software impairment relates to development costs capitalized for a project that was determined to not meet the Company's strategic goals when analyzed by the Company's new leadership team. |
Restructuring Costs Leadership
Restructuring Costs Leadership Realignment (Details) - USD ($) $ in Millions | 3 Months Ended | |||
Mar. 31, 2018 | Mar. 31, 2017 | |||
Restructuring Reserve [Roll Forward] | ||||
Restructuring costs, net | $ 30 | $ 5 | [1] | |
Real Estate Franchise Services | ||||
Restructuring Reserve [Roll Forward] | ||||
Restructuring costs, net | 2 | |||
Company Owned Real Estate Brokerage Services | ||||
Restructuring Reserve [Roll Forward] | ||||
Restructuring costs, net | 17 | 5 | ||
Relocation Services | ||||
Restructuring Reserve [Roll Forward] | ||||
Restructuring costs, net | 8 | |||
Title and Settlement Services | ||||
Restructuring Reserve [Roll Forward] | ||||
Restructuring costs, net | 1 | |||
Personnel Related | ||||
Restructuring Reserve [Roll Forward] | ||||
Restructuring costs, net | [2] | 14 | 5 | |
Facility Related | ||||
Restructuring Reserve [Roll Forward] | ||||
Restructuring costs, net | [3] | 9 | 0 | |
Internal Use Software Impairment | ||||
Restructuring Reserve [Roll Forward] | ||||
Restructuring costs, net | [4] | 7 | $ 0 | |
Leadership Realignment | ||||
Restructuring Reserve [Roll Forward] | ||||
Balance at December 31, 2017 | 0 | |||
Restructuring costs, net | 29 | |||
Costs paid or otherwise settled | (16) | |||
Balance at March 31, 2018 | 13 | |||
Restructuring and Related Cost, Expected Cost [Abstract] | ||||
Total amount expected to be incurred | 41 | |||
Amount incurred to date | 29 | |||
Total amount remaining to be incurred | 12 | |||
Leadership Realignment | Real Estate Franchise Services | ||||
Restructuring and Related Cost, Expected Cost [Abstract] | ||||
Total amount expected to be incurred | 2 | |||
Amount incurred to date | 2 | |||
Total amount remaining to be incurred | 0 | |||
Leadership Realignment | Company Owned Real Estate Brokerage Services | ||||
Restructuring and Related Cost, Expected Cost [Abstract] | ||||
Total amount expected to be incurred | 27 | |||
Amount incurred to date | 16 | |||
Total amount remaining to be incurred | 11 | |||
Leadership Realignment | Relocation Services | ||||
Restructuring and Related Cost, Expected Cost [Abstract] | ||||
Total amount expected to be incurred | 9 | |||
Amount incurred to date | 8 | |||
Total amount remaining to be incurred | 1 | |||
Leadership Realignment | Title and Settlement Services | ||||
Restructuring and Related Cost, Expected Cost [Abstract] | ||||
Total amount expected to be incurred | 1 | |||
Amount incurred to date | 1 | |||
Total amount remaining to be incurred | 0 | |||
Leadership Realignment | Corporate Segment | ||||
Restructuring and Related Cost, Expected Cost [Abstract] | ||||
Total amount expected to be incurred | 2 | |||
Amount incurred to date | 2 | |||
Total amount remaining to be incurred | 0 | |||
Leadership Realignment | Personnel Related | ||||
Restructuring Reserve [Roll Forward] | ||||
Balance at December 31, 2017 | 0 | |||
Restructuring costs, net | 14 | |||
Costs paid or otherwise settled | (8) | |||
Balance at March 31, 2018 | 6 | |||
Restructuring and Related Cost, Expected Cost [Abstract] | ||||
Total amount expected to be incurred | 17 | |||
Amount incurred to date | 14 | |||
Total amount remaining to be incurred | 3 | |||
Leadership Realignment | Facility Related | ||||
Restructuring Reserve [Roll Forward] | ||||
Balance at December 31, 2017 | 0 | |||
Restructuring costs, net | 8 | |||
Costs paid or otherwise settled | (1) | |||
Balance at March 31, 2018 | 7 | |||
Restructuring and Related Cost, Expected Cost [Abstract] | ||||
Total amount expected to be incurred | 17 | |||
Amount incurred to date | 8 | |||
Total amount remaining to be incurred | 9 | |||
Leadership Realignment | Internal Use Software Impairment | ||||
Restructuring Reserve [Roll Forward] | ||||
Balance at December 31, 2017 | 0 | |||
Restructuring costs, net | 7 | |||
Costs paid or otherwise settled | (7) | |||
Balance at March 31, 2018 | 0 | |||
Restructuring and Related Cost, Expected Cost [Abstract] | ||||
Total amount expected to be incurred | 7 | |||
Amount incurred to date | 7 | |||
Total amount remaining to be incurred | $ 0 | |||
[1] | Includes restructuring charges of $2 million in the Real Estate Franchise Services segment, $17 million in the Company Owned Real Estate Brokerage Services segment, $8 million in the Cartus segment, $1 million at Title and Settlement Services segment and $2 million in Corporate and Other for the three months ended March 31, 2018. Includes restructuring charges of $5 million in the Company Owned Real Estate Brokerage Services segment for the three months ended March 31, 2017. | |||
[2] | Personnel-related costs consist of severance costs provided to employees who have been terminated and duplicate payroll costs during transition. | |||
[3] | Facility-related costs consist of costs associated with planned facility closures such as contract termination costs, lease payments, net of applicable sublease income, that will continue to be incurred under the contract for its remaining term without economic benefit to the Company, accelerated depreciation on asset disposals and other facility and employee relocation related costs. | |||
[4] | Internal use software impairment relates to development costs capitalized for a project that was determined to not meet the Company's strategic goals when analyzed by the Company's new leadership team. |
Restructuring Costs Business Op
Restructuring Costs Business Optimization Initiative (Details) - Business Optimization Plan [Member] - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2018 | Dec. 31, 2017 | |
Restructuring Cost and Reserve [Line Items] | ||
Restructuring Reserve | $ 7 | |
Costs paid or otherwise settled | $ (3) | |
Total amount remaining to be incurred | 5 | |
Facility Related | ||
Restructuring Cost and Reserve [Line Items] | ||
Amount incurred to date | $ 1 |
Earnings Per Share Earnings P55
Earnings Per Share Earnings Per Share (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 25 Months Ended | |
Mar. 31, 2018 | Mar. 31, 2017 | Mar. 31, 2018 | |
Earnings Per Share [Abstract] | |||
Target Achievement Percentage | 100.00% | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 7,600,000 | 7,300,000 | |
Stock Repurchases [Line Items] | |||
Shares Repurchased and Retired During Period, Shares | 3,700,000 | 20,200,000 | |
Shares Repurchased and Retired During Period, Value | $ 99 | ||
Weighted Average Market Price of Shares Repurchased and Retired During Period | $ 26.58 | $ 28.36 | |
Common Stock Settlement Date after Period End | |||
Stock Repurchases [Line Items] | |||
Shares Repurchased and Retired During Period, Shares | 202,860 |
Commitments And Contingencies (
Commitments And Contingencies (Details) $ in Thousands | 3 Months Ended | |||
Jun. 30, 2017USD ($) | Mar. 31, 2018USD ($) | Dec. 31, 2017USD ($) | Jul. 31, 2006Independent_Companies | |
Loss Contingencies [Line Items] | ||||
Cendant Spin-off Number of New Independent Companies | Independent_Companies | 4 | |||
Number of New Independent Companies per Cendant Business Unit | Independent_Companies | 1 | |||
Guaranty Arrangement Percentage of Obligations Assumed by Realogy | 62.50% | |||
Guaranty Arrangement Percentage of Obligations Assumed by Wyndham | 37.50% | |||
Due to former parent | $ 18,000 | $ 18,000 | ||
Noninterest-bearing deposit liabilities | 548,000 | $ 469,000 | ||
Maximum | ||||
Loss Contingencies [Line Items] | ||||
Cash, FDIC insured amount | $ 250 | |||
Strader | ||||
Loss Contingencies [Line Items] | ||||
Legal Fees | $ 8,000 |
Segment Information - Revenues
Segment Information - Revenues (Details) - USD ($) $ in Millions | 3 Months Ended | |||
Mar. 31, 2018 | Mar. 31, 2017 | |||
Segment Reporting, Revenue Reconciling Item [Line Items] | ||||
Revenues | [1],[2] | $ 1,229 | $ 1,203 | [3] |
Real Estate Franchise Services | ||||
Segment Reporting, Revenue Reconciling Item [Line Items] | ||||
Revenues | [1],[2] | 176 | 170 | [3] |
Real Estate Franchise Services | Royalties and Marketing Fees | ||||
Segment Reporting, Revenue Reconciling Item [Line Items] | ||||
Revenues | 63 | 61 | ||
Company Owned Real Estate Brokerage Services | ||||
Segment Reporting, Revenue Reconciling Item [Line Items] | ||||
Revenues | [1],[2] | 917 | 897 | [3] |
Relocation Services | ||||
Segment Reporting, Revenue Reconciling Item [Line Items] | ||||
Revenues | [1],[2] | 79 | 77 | [3] |
Relocation Services | Referral and Relocation Fees | ||||
Segment Reporting, Revenue Reconciling Item [Line Items] | ||||
Revenues | 8 | 8 | ||
Title and Settlement Services | ||||
Segment Reporting, Revenue Reconciling Item [Line Items] | ||||
Revenues | [1],[2] | 120 | 120 | [3] |
Corporate and Other | ||||
Segment Reporting, Revenue Reconciling Item [Line Items] | ||||
Revenues | [1],[2],[4] | $ (63) | $ (61) | [3] |
[1] | Revenues for the Relocation Services segment include intercompany referral commissions paid by the Company Owned Real Estate Brokerage Services segment of $8 million for both the three months ended March 31, 2018 and 2017. Such amounts are recorded as contra-revenues by the Company Owned Real Estate Brokerage Services segment. There are no other material intersegment transactions. | |||
[2] | Transactions between segments are eliminated in consolidation. Revenues for the Real Estate Franchise Services segment include intercompany royalties and marketing fees paid by the Company Owned Real Estate Brokerage Services segment of $63 million and $61 million for the three months ended March 31, 2018 and 2017, respectively. Such amounts are eliminated through the Corporate and Other line. | |||
[3] | Prior period amounts have not been adjusted under the modified retrospective method. | |||
[4] | Includes the elimination of transactions between segments. |
Segment Information - Operating
Segment Information - Operating EBITDA (Details) - USD ($) $ in Millions | 3 Months Ended | ||||
Mar. 31, 2018 | Mar. 31, 2017 | ||||
Segment Reporting Information [Line Items] | |||||
Earnings Before Interest, Taxes, Depreciation and Amortization, Restructuring, Legacy Items and Loss on Early Extinguishment of Debt | $ 34 | $ 61 | |||
Depreciation, Depletion and Amortization, Nonproduction, Adjusted for Amortization of Intangible Assets related to GRA Acquisition | [1] | 50 | |||
Depreciation and amortization | 48 | [2] | 50 | [1] | |
Interest expense, net | 33 | [2] | 39 | ||
Income tax benefit | (19) | [2] | (9) | ||
Restructuring costs, net | 30 | 5 | [3] | ||
Loss on the early extinguishment of debt | [4] | 7 | 4 | ||
Net loss attributable to Realogy Holdings and Realogy Group | (67) | (28) | |||
Equity losses from equity method investment | 4 | 3 | |||
Real Estate Franchise Services | |||||
Segment Reporting Information [Line Items] | |||||
Earnings Before Interest, Taxes, Depreciation and Amortization, Restructuring, Legacy Items and Loss on Early Extinguishment of Debt | 105 | 102 | |||
Restructuring costs, net | 2 | ||||
Company Owned Brokerage Services | |||||
Segment Reporting Information [Line Items] | |||||
Earnings Before Interest, Taxes, Depreciation and Amortization, Restructuring, Legacy Items and Loss on Early Extinguishment of Debt | (45) | (21) | |||
Restructuring costs, net | 17 | 5 | |||
Relocation Services | |||||
Segment Reporting Information [Line Items] | |||||
Earnings Before Interest, Taxes, Depreciation and Amortization, Restructuring, Legacy Items and Loss on Early Extinguishment of Debt | (1) | 1 | |||
Restructuring costs, net | 8 | ||||
Title and Settlement Services | |||||
Segment Reporting Information [Line Items] | |||||
Earnings Before Interest, Taxes, Depreciation and Amortization, Restructuring, Legacy Items and Loss on Early Extinguishment of Debt | (6) | 2 | |||
Restructuring costs, net | 1 | ||||
Corporate and Other | |||||
Segment Reporting Information [Line Items] | |||||
Earnings Before Interest, Taxes, Depreciation and Amortization, Restructuring, Legacy Items and Loss on Early Extinguishment of Debt | [2] | (19) | $ (23) | ||
Restructuring costs, net | 2 | ||||
Amortization of Intangible Assets related to GRA Acquisition | |||||
Segment Reporting Information [Line Items] | |||||
Equity losses from equity method investment | $ 2 | ||||
[1] | Depreciation and amortization for the three months ended March 31, 2018 includes $2 million of amortization expense related to Guaranteed Rate Affinity's purchase accounting included in the "Equity in losses of unconsolidated entities" line on the Condensed Consolidated Statement of Operations. | ||||
[2] | Includes the elimination of transactions between segments. | ||||
[3] | Includes restructuring charges of $2 million in the Real Estate Franchise Services segment, $17 million in the Company Owned Real Estate Brokerage Services segment, $8 million in the Cartus segment, $1 million at Title and Settlement Services segment and $2 million in Corporate and Other for the three months ended March 31, 2018. Includes restructuring charges of $5 million in the Company Owned Real Estate Brokerage Services segment for the three months ended March 31, 2017. | ||||
[4] | Loss on the early extinguishment of debt is recorded in the Corporate and Other segment. |