Ocwen Financial Corporation (NYSE: OCN) reported record revenue growth for the second quarter ending June 30, 2013, highlighting the company’s acquisition of Liberty Home Equity Solutions, Inc. as a key contribution to overall financial performance.
For the quarter, Ocwen produced revenue of $530 million, up 151% from the second quarter of 2012.
Contributing to this record growth was the company’s $22 million cash acquisition of Liberty from Genworth Financial, Inc. completed on April 1, 2013.
As one of the largest reverse mortgage originators exhibiting strong retail and wholesale originations, Liberty generated $18.5 million of revenue and $4.3 million of pre-tax earnings for the quarter.
“We are pleased with Ocwen’s strong core earnings and cash flow which should continue to grow with the boarding of new acquisitions,” said Ocwen Chairman Bill Erbey.
Ocwen also reported that its net income rose approximately 71% to $76.7 million, or $0.53 per share, for the second quarter of 2013 compared to $44.8 million, or $0.32 per share, from the same period a year ago.
Income from operations grew by 24% to $155.2 million for the quarter when compared to $125.5 million for the same quarter in 2012.
Other highlights for the quarter included completed acquisitions of Fannie Mae and Freddie Mac mortgage servicing rights on loans with unpaid principal balance (UPB) of $87 billion from Ally Bank.
Ocwen also generated cash flow from operations of $475.1 million, however, after reducing this amount for the repayment of $179.6 million in related match funded debt, cash flow from operations became $295.5 million for the quarter.
“Our current pipeline of potential new business opportunities on a probability-weighted basis exceeds $400 billion in unpaid principal balance,” Erbey said. “Moreover, regulatory market trends, including greater prospects for GSE legislation and more private capital flowing into mortgage credit, provide excellent long-term prospects for Ocwen.”
Written by Jason Oliva