Newmark Group Inc.

05/06/2021 | Press release | Distributed by Public on 05/06/2021 06:01

Q1 2021 Supplemental Tables

Table of Contents

Newmark Group, Inc. - Quarterly Financial Data Supplement - as recast on February 18, 2021 (1) 1Q21
Table of Contents
Page
Consolidated Results
Condensed Consolidated Balance Sheets 2
Condensed Consolidated Statements of Operations 3
Condensed Consolidated Statements of Cash Flows 4
Revenue Detail 5
GAAP and Adjusted Earnings Expense and Other Income Detail(1) 6
Reconciliation of GAAP Income (Loss) to Adjusted Earnings and GAAP Fully Diluted EPS to Post-tax Adjusted EPS(1) 7
Historical Reconciliation of GAAP Income (Loss) to Adjusted Earnings and GAAP Fully Diluted EPS to Post-tax Adjusted EPS(1) 8
Reconciliation of GAAP Income (Loss) to Adjusted EBITDA(1) 9
Historical Reconciliation of GAAP Income (Loss) to Adjusted EBITDA(1) 10
Fully Diluted Weighted-Average Share Count for GAAP and Adjusted Earnings 11
Equity-based Compensation and Allocations of Net Income to Limited Partnership Units and FPUs(2) 12
Debt and Capital Markets Volumes 13
(1) Beginning in the fourth quarter of 2020, the OMSR revenue adjustment is no longer be included in non-compensation expenses for Adjusted Earnings but instead as a separate line item in the Company's non-GAAP reconciliations. There is no impact to Adjusted Earnings or Adjusted EBITDA. Also beginning this quarter, the Company excludes compensation charges related to non-cash GAAP gains attributable to originated mortgage servicing rights (which Newmark refers to as "OMSRs") because these gains are also excluded from Adjusted Earnings and Adjusted EBITDA. Newmark has recast its historical results to be consistent with this new presentation in the comparative periods presented in this supplement.
(2) On November 11, 2019, Newmark revised the Equity-based Compensation tab of the Financial Supplement to include additional historical data. 2Q 2019 was revised due to a reclassification of the individual
components of equity-based compensation. "Exchangeability expense" has been renamed "Issuance of common stock and exchangeability expenses."
Note: certain tables throughout this document may not reconcile due to rounding.

US GAAP Bal Sheet PR

NEWMARK GROUP, INC.
CONSOLIDATED BALANCE SHEETS
(in thousands, except per share data)
(unaudited)
March 31, 2021 December 31, 2020
Assets
Current Assets:
Cash and cash equivalents $ 142,854 $ 191,448
Restricted cash 68,295 66,951
Marketable securities 4,001 33,283
Loans held for sale, at fair value 821,194 1,086,805
Receivables, net 394,064 376,795
Receivables from related parties - 0 - 0
Other current assets 73,451 63,790
Total current assets 1,503,859 1,819,072
Goodwill 593,294 560,332
Mortgage servicing rights, net 527,244 494,729
Loans, forgivable loans and other receivables from employees and partners 444,674 454,270
Right-of-use assets 422,711 190,469
Fixed assets, net 115,452 96,367
Other intangible assets, net 61,508 44,289
Other assets 331,991 322,922
Total assets $ 4,000,733 $ 3,982,450
Liabilities, Redeemable Partnership Interest, and Equity:
Current Liabilities:
Warehouse facilities collateralized by U.S. Government Sponsored Enterprises $ 817,033 $ 1,061,202
Accrued compensation 272,015 279,872
Current portion of accounts payable, accrued expenses and other liabilities 373,441 326,548
Securities loaned - 0 33,278
Current portion of payables to related parties 6,045 4,392
Total current liabilities 1,468,534 1,705,292
Long-term debt 681,270 680,385
Right-of-use liabilities 426,318 218,629
Other long-term liabilities 433,747 436,952
Total liabilities 3,009,869 3,041,258
Equity:
Total equity (1) 990,864 941,192
Total liabilities, redeemable partnership interest, and equity $ 4,000,733 $ 3,982,450
(1) Includes "redeemable partnership interests," "noncontrolling interests" and "total stockholders' equity."
- 0 (0)

US GAAP P&L PR

NEWMARK GROUP, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)
(unaudited)
Three Months Ended March 31, Year Ended December 31, Nine Months Ended September 30,
Revenues: 2021 2020 2020 2019 2020 2019
Leasing and other commissions $ 147,433 $ 140,439 $ 513,842 $ 854,780 $ 375,465 $ 603,094
Capital Markets 121,403 127,923 454,106 541,255 263,838 376,213
Commissions 268,836 268,362 967,948 1,396,035 639,303 979,307
Gains from mortgage banking activities/origination, net 47,393 50,422 310,914 198,085 210,686 148,769
Management services, servicing fees and other 187,751 165,146 626,136 624,012 453,583 457,692
Total revenues 503,980 483,930 1,904,998 2,218,132 1,303,572 1,585,768
Expenses:
Compensation and employee benefits 289,074 300,257 1,147,360 1,275,988 784,684 921,126
Equity-based compensation and allocations of net income to limited partnership units and FPUs 14,248 12,914 130,759 258,836 74,544 109,871
Total compensation and employee benefits 303,322 313,171 1,278,119 1,534,824 859,228 1,030,997
Operating, administrative and other 107,175 92,281 294,405 361,857 215,083 275,939
Fees to related parties 6,250 5,812 22,573 25,025 17,126 21,035
Depreciation and amortization 21,053 46,039 141,193 131,144 104,613 98,510
Total non-compensation expenses 134,478 144,132 458,171 518,026 336,822 395,484
Total operating expenses 437,800 457,303 1,736,290 2,052,850 1,196,050 1,426,481
Other income, net:
Other income (loss), net (2,210) 1,438 15,290 80,954 73,657 95,267
Total other income (loss), net (2,210) 1,438 15,290 80,954 73,657 95,267
Income from operations 63,970 28,065 183,998 246,236 181,179 254,554
Interest expense, net (8,813) (9,030) (37,728) (32,088) (28,617) (23,947)
Income (loss) before income taxes and noncontrolling interests 55,157 19,035 146,270 214,148 152,562 230,607
Provision (benefit) for income taxes 10,579 4,797 36,993 52,436 38,158 52,568
Consolidated net (loss) income 44,578 14,238 109,277 161,712 114,404 178,039
Less: Net income (loss) attributable to noncontrolling interests 11,473 6,056 29,217 44,407 30,563 49,769
Net income (loss) available to common stockholders $ 33,105 $ 8,182 $ 80,060 $ 117,305 $ 83,841 $ 128,270
Per share data:
Basic earnings per share
Net income (loss) available to common stockholders (1) $ 31,464 $ 5,737 $ 70,281 $ 104,406 $ 75,703 $ 118,599
Basic earnings (loss) per share $ 0.17 $ 0.03 $ 0.39 $ 0.59 $ 0.42 $ 0.67
Basic weighted-average shares of common stock outstanding 183,254 177,545 179,106 177,774 178,527 178,122
Fully diluted earnings per share
Net income (loss) for fully diluted shares (1) $ 43,925 $ 8,933 $ 70,281 $ 108,160 $ 110,422 $ 122,379
Fully diluted earnings(loss) per share $ 0.16 $ 0.03 $ 0.39 $ 0.58 $ 0.42 $ 0.66
Fully diluted weighted-average shares of common stock outstanding 271,194 263,646 179,690 185,016 265,104 185,413
Dividends declared per share of common stock $ 0.01 $ 0.10 $ 0.13 $ 0.40 $ 0.12 $ 0.30
Dividends paid per share of common stock $ 0.01 $ 0.10 $ 0.13 $ 0.39 $ 0.12 $ 0.29
(1) Includes a reduction for dividends on preferred stock or exchangeable preferred partnership units of $1.6 million and $2.4 million for the three months ended March 31, 2021 and 2020, respectively. (see Note 1 - "Organization and Basis of Presentation" in the Company's most recently filed Form 10-Q or Form 10-K.)

Summary Cash Flow

NEWMARK GROUP INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
Year Ended Three Months Ended March 31,
2020 2019 2018 2021 2020
Net cash (used in) provided by operating activities $ (777,694) $ 986,760 $ (332,367) $ 290,960 $ (652,401)
Net cash (used in) provided by investing activities (3,602) (56,788) 7,742 (9,783) 18,800
Net cash provided by (used in) financing activities 817,823 (895,506) 338,657 (328,427) 763,318
Net increase in cash and cash equivalents and restricted cash 36,527 34,466 14,032 (47,250) 129,717
Cash and cash equivalents and restricted cash at beginning of period 221,872 187,406 173,374 258,399 221,872
Cash and cash equivalents and restricted cash at end of period $ 258,399 $ 221,872 $ 187,406 $ 211,149 $ 351,589
Net cash provided by operating activities excluding loan originations and sales (1) $ 93,821 $ 211,186 $ 295,862 $ 25,349 $ (128,309)
(1) Includes payments for new hires and producers in the amount of $3.6 million and $60.0 million for the three months ended March 31, 2021, and 2020 respectively.
The Condensed Consolidated Statements of Cash Flows are presented in summarized form. For complete Condensed Consolidated Statements of Cash Flows, please refer to Newmark's Quarterly Report on Form 10-Q for the three months ended March 31, 2021, to be filed with the Securities and Exchange Commission in the near future.

Revenue Detail

NEWMARK GROUP, INC.
REVENUE DETAIL
(in thousands)
(unaudited)
2021 2020 2019 2018
Q1 Q1 Q2 Q3 Q4 FY Q1 Q2 Q3 Q4 FY Q1 Q2 Q3 Q4 FY
Detail of revenues as presented in the Statement of Operations:
Leasing and other commissions 147,433 140,439 120,079 114,947 138,377 513,842 172,471 217,381 213,242 251,686 854,780 159,371 178,142 203,904 276,017 817,434
Capital markets 121,403 127,923 52,959 82,956 190,268 454,106 102,797 128,750 144,666 165,042 541,255 101,364 101,691 115,436 150,414 468,905
Commissions $ 268,836 $ 268,362 $ 173,038 $ 197,903 $ 328,645 $ 967,948 $ 275,268 $ 346,131 $ 357,908 $ 416,728 $ 1,396,035 $ 260,735 $ 279,833 $ 319,340 $ 426,431 $ 1,286,339
OMSR revenue (1) (2) 28,716 29,347 42,128 60,947 62,392 194,814 16,378 24,855 37,423 30,592 109,248 21,097 24,695 28,685 28,725 103,202
Loan originations related fees and sales premiums, net 18,677 21,075 26,943 30,246 37,836 116,100 14,968 20,236 34,909 18,724 88,837 17,817 17,182 23,287 20,776 79,062
Gains from mortgage banking activities/origination, net 47,393 50,422 69,071 91,193 100,228 310,914 31,346 45,091 72,332 49,316 198,085 38,914 41,877 51,972 49,501 182,264
Management services fee revenue (3) 58,927 59,052 48,417 47,345 54,429 209,243 46,345 51,683 52,701 65,051 215,780 37,493 46,554 50,073 54,235 188,355
Non-fee management services revenue (2) (4) 87,640 66,519 56,680 60,152 74,917 258,268 51,744 65,790 51,483 61,568 230,585 59,439 60,674 51,895 54,084 226,092
Servicing fees and other revenues (5) 41,183 39,575 36,512 39,331 43,207 158,625 42,953 42,783 52,210 39,701 177,647 33,879 37,681 45,529 47,441 164,530
Management services, servicing fees and other 187,750 165,146 141,609 146,828 172,553 626,136 141,042 160,256 156,394 166,320 624,012 130,811 144,909 147,497 155,760 578,977
Total revenues $ 503,979 $ 483,930 $ 383,718 $ 435,924 $ 601,426 1,904,998 $ 447,656 $ 551,478 $ 586,634 $ 632,364 $ 2,218,132 $ 430,460 $ 466,619 $ 518,809 $ 631,692 $ 2,047,580
Detail of revenues as presented in the investor presentations:
Commission-based revenues (6) 320,132 317,553 219,915 253,326 400,370 1,191,164 $306,660 $388,023 $418,477 $463,876 $1,577,036 $289,481 $313,780 $362,132 $468,928 $1,434,321
Management fees & other revenue (7) 67,412 70,511 64,995 61,499 63,747 260,752 72,874 72,810 79,251 76,328 301,263 60,443 67,470 76,097 79,954 283,964
Non-fee revenue (2) (4) 116,356 95,866 98,808 121,099 137,309 453,082 68,122 90,645 88,906 92,160 339,833 80,536 85,369 80,580 82,809 329,294
Total Revenue 503,900 483,930 383,718 435,924 601,426 1,904,998 $447,656 $551,478 $586,634 $632,364 $2,218,132 $430,460 $466,619 $518,809 $631,691 $2,047,579
Non-fee revenue detail (2) (4):
OMSR revenue 28,716 29,347 42,128 60,947 62,392 194,814 16,378 24,855 37,423 30,592 109,248 21,097 24,695 28,685 28,725 103,202
Non-fee management services revenue 87,640 66,519 56,680 60,152 74,917 258,268 51,744 65,790 51,483 61,568 230,585 59,439 60,674 51,895 54,084 226,092
Total non-fee revenue $116,356 $95,866 $98,808 $121,099 $137,309 $453,082 $68,122 $90,645 $88,906 $92,160 $339,833 $80,536 $85,369 $80,580 $82,809 $329,294
(1) Non-cash gains attributable to originated mortgage servicing rights, which represent the fair value of expected net future cash flows from servicing recognized at commitment, net.
(2) Non-fee (or "pass-through") management services revenues have no impact on the Company's GAAP or non-GAAP earnings measures, while non-cash OMSR revenues and non-cash MSR amortization are excluded from the calculations of Adjusted EBITDA and Adjusted Earnings. See the tabs with reconciliations of GAAP net income to Adjusted Earnings and to Adjusted EBITDA for historical non-cash OMSR revenues and non-cash MSR amortization.
(3) Management services fee revenue includes Facilities Management, Property Management, Project Management, Consulting, Valuation & Advisory, and Underwriting.
(4) Non-fee management services revenue represent fully reimbursable compensation and non-compensation expenses recorded as part of Newmark's management services business.
(5) Servicing fees include mortgage servicing fees, escrow interest and placement fees, and ancillary fees. "Other revenues" include interest income on loans held-for-sale.
(6) Commission-based revenues include Leasing and other commissions, Capital markets, Loan originations related fees and sales premiums, net, and Valuation and Advisory.
(7) Includes fees from management services, mortgage servicing, and interest income on loans held for sale.

Expense and Other Income Detail

NEWMARK GROUP, INC.
GAAP AND ADJUSTED EARNINGS EXPENSE AND OTHER INCOME DETAIL
(in thousands)
(unaudited)
2021 2020 2019 2018
Q1 Q1 Q2 Q3 Q4 FY Q1 Q2 Q3 Q4 FY Q1 Q2 Q3 Q4 FY
GAAP expense summary:
Total compensation and employee benefits $ 303,322 $ 313,172 $ 241,378 $ 304,678 $ 418,891 $ 1,278,119 $ 277,274 $ 356,090 $ 397,683 $ 503,827 $ 1,534,874 $ 278,502 $ 334,006 $ 332,158 $ 441,960 $ 1,386,626
Total non compensation expense 134,478 144,133 95,163 97,526 121,349 458,171 122,895 142,396 130,166 122,542 517,999 104,832 106,550 117,431 126,819 455,632
Total expenses for GAAP $ 437,800 $ 457,305 $ 336,541 $ 402,204 $ 540,240 $ 1,736,290 $ 400,169 $ 498,486 $ 527,849 $ 626,369 $ 2,052,873 $ 383,334 $ 440,556 $ 449,589 $ 568,779 $ 1,842,258
GAAP other income/(loss) and other expenses:
Other income/(loss) $ (2,210) $ 1,438 $ (36,389) $ 108,608 $ (58,367) $ 15,290 $ (9,718) $ (3,726) $ 108,711 $ (14,313) $ 80,954 $ 5,707 $ (365) $ 93,717 $ 28,234 $ 127,293
Tax provision/(benefit) $ 10,579 $ 4,797 $ 88 $ 33,273 $ (1,165) $ 36,993 $ 6,687 $ 9,121 $ 36,760 $ (132) $ 52,436 $ 6,933 $ 10,822 $ 35,870 $ 36,862 $ 90,487
Net income (loss) attributable to noncontrolling interests $ 11,473 $ 6,056 $ 330 $ 24,177 $ (1,346) $ 29,217 $ 6,502 $ 9,396 $ 33,871 $ (5,362) $ 44,407 $ 12,490 $ 3,555 $ 47,321 $ 21,800 $ 85,166
Adjusted earnings expense summary:
Total compensation and employee benefits $ 288,158 $ 299,693 $ 228,675 $ 248,762 $355,944 $ 1,133,074 $ 263,891 $ 317,040 $ 341,656 $350,389 $ 1,272,976 $ 261,796 $ 267,151 $ 292,055 $343,770 $ 1,164,772
Total non compensation expense (1) 116,611 115,493 68,110 71,593 81,013 336,209 99,517 113,071 97,787 90,281 400,656 85,282 89,213 94,850 101,385 370,730
Total expenses for adjusted earnings $ 404,769 $ 415,186 $ 296,785 $ 320,355 $436,957 $ 1,469,283 $ 363,408 $ 430,111 $ 439,443 $ 440,670 $ 1,673,632 $ 347,078 $ 356,364 $ 386,905 $ 445,155 $ 1,535,502
Detail of expenses as presented in the investor presentations:
Commission-based compensation $162,376 $157,166 $110,993 $126,240 $204,231 $598,630 $148,930 $194,470 $210,804 $236,138 $790,342 $146,844 $159,248 $181,938 $235,305 $723,335
Support and operational expenses - comp 93,023 96,687 77,898 77,948 97,997 350,530 83,326 88,242 94,354 74,468 340,390 76,080 72,738 79,533 77,226 305,577
Pass-through fees related to management services revenues - comp 32,759 45,840 39,784 44,574 53,716 183,914 31,635 34,328 36,498 39,783 142,244 38,872 35,165 30,584 31,239 135,860
Total compensation and employee benefits $288,158 $299,693 $228,675 $248,762 $355,944 $1,133,074 263,891 317,040 341,656 350,389 1,272,976 261,796 267,151 292,055 343,770 1,164,772
Support and operational expenses - non-comp (2) 61,730 94,814 51,210 56,014 59,817 261,855 79,409 81,609 82,802 68,495 312,315 64,715 63,704 73,539 78,545 280,503
Pass-through fees related to management services revenues - non-comp 54,881 20,679 16,900 15,579 21,196 74,354 20,108 31,462 14,985 21,786 88,341 20,567 25,509 21,311 22,840 90,227
Total non compensation expense (2) 116,611 115,493 68,110 71,593 81,013 336,209 99,517 113,071 97,787 90,281 400,656 85,282 89,213 94,850 101,385 370,730
Total expenses for adjusted earnings (2) $404,769 $415,186 $296,785 $320,355 $436,957 $1,469,283 $363,408 $430,111 $439,443 $440,670 $1,673,632 $347,078 $356,364 $386,905 $445,155 $1,535,502
Adjusted earnings other income/(loss) and other expenses:
Other income/(loss) $ 3,392 $ (2,075) $ (3,878) $ 94,462 $ (5,118) $ 83,391 $ 4,142 $ 7,919 $ 86,692 $ 8,272 $ 107,025 $ 5,608 $ 2,432 $ 84,924 $ (2,340) $ 90,624
Tax provision/(benefit) $ 10,673 $ 4,158 $ 4,571 $ 20,932 $ 19,096 $ 48,757 $ 9,266 $ 15,608 $ 28,242 $ 22,394 $ 75,510 $ 7,254 $ 10,234 $ 23,418 $ 26,787 $ 67,693
Net income (loss) attributable to noncontrolling interests $ 659 $ 455 $ 213 $ (9) $ 544 $ 1,203 $ (137) $ 342 $ 584 $ 378 $ 1,167 $ 803 $ 245 $ 415 $ 259 $ 1,722
(1) Beginning in the first quarter of 2021, the OMSR revenue adjustment will no longer be included in non-compensation expenses for Adjusted Earnings but instead as a separate line item in the Company's non-GAAP reconciliations. Historical expense amounts have been recast to reflect this change. There is no impact to Adjusted Earnings or Adjusted EBITDA.
(2) Non-fee (or "pass-through") management services revenues have no impact on the Company's GAAP or non-GAAP earnings measures, while non-cash OMSR revenues and non-cash MSR amortization are excluded from the calculations of Adjusted EBITDA and Adjusted Earnings. See the tabs with reconciliations of GAAP net income to Adjusted Earnings and to Adjusted EBITDA for historical non-cash OMSR revenues and non-cash MSR amortization.

Recon of GAAP to AE PR

NEWMARK GROUP, INC.
RECONCILIATION OF GAAP NET INCOME (LOSS) TO COMMON STOCKHOLDERS TO ADJUSTED EARNINGS BEFORE NONCONTROLLING INTERESTS AND TAXES AND
GAAP FULLY DILUTED EPS TO POST-TAX ADJUSTED EPS
(in thousands, except per share data)
(unaudited)
Three Months Ended March 31, Year Ended December 31,
2021 2020 2020 2019
GAAP net income available to common stockholders $ 33,105 $ 8,182 $ 80,060 $ 117,305
Provision for income taxes (1) 10,579 4,797 36,993 52,436
Net income attributable to noncontrolling interests(2) 11,473 6,056 29,217 44,407
GAAP income (loss) before income taxes and noncontrolling interests $ 55,157 $ 19,035 $ 146,270 $ 214,148
Pre-tax adjustments:
Compensation adjustments:
Equity-based compensation and allocations of net income to limited partnership units and FPUs (3) 14,248 12,914 130,759 258,836
Other compensation adjustments(4) 917 564 14,282 3,010
Total Compensation adjustments 15,165 13,478 145,041 261,846
Non-Compensation expense adjustments:
Amortization of intangibles (5) 1,666 1,643 7,012 6,920
MSR amortization(6) 15,067 39,471 111,252 101,530
Other non-compensation adjustments (7) 1,132 (12,480) 3,701 8,601
Total Non-Compensation expense adjustments 17,865 28,634 121,965 117,051
Non-cash adjustment for OMSR revenue(8) (28,716) (29,347) (194,814) (109,248)
Other (income) loss:
Other non-cash, non-dilutive, and /or non-economic items (9) 5,602 (3,514) 78,337 26,367
Total Other (income) loss 5,602 (3,514) 78,337 26,367
Total pre-tax adjustments 9,916 9,251 150,529 296,016
Adjusted Earnings before noncontrolling interests and taxes $ 65,073 $ 28,286 $ 296,799 $ 510,164
GAAP Net income available to common stockholders: $ 33,105 $ 8,182 $ 80,060 $ 117,305
Allocation of net income to noncontrolling interests (10) 10,814 5,601 28,014 43,240
Total pre-tax adjustments (from above) 9,916 9,251 150,529 296,016
Income tax adjustment to reflect adjusted earnings taxes (1) (93) 638 (11,759) (23,072)
Post-tax Adjusted Earnings to fully diluted shareholders $ 53,742 $ 23,672 $ 246,844 $ 433,489
Per Share Data:
GAAP fully diluted earnings per share(11) $ 0.16 $ 0.03 $ 0.39 $ 0.58
Allocation of net income (loss) to noncontrolling interests - 0 - 0 - 0 - 0
Exchangeable preferred limited partnership units non-cash preferred dividends 0.01 0.01 0.05 0.05
Total pre-tax adjustments (from above) 0.04 0.04 0.57 1.12
Income tax adjustment to reflect adjusted earnings taxes - 0 - 0 (0.04) (0.09)
Other (0.01) 0.01 (0.04) (0.05)
Post-tax adjusted earnings per share $ 0.20 $ 0.09 $ 0.93 $ 1.61
Pre-tax adjusted earnings per share $ 0.24 $ 0.11 $ 1.12 $ 1.90
Fully diluted weighted-average shares of common stock outstanding 271,194 263,646 264,851 268,860
(1) Newmark's GAAP provision (benefit) for income taxes is calculated based on an annualized methodology. Newmark includes additional tax-deductible items when calculating the provision (benefit) for taxes with respect to Adjusted Earnings using an annualized methodology. These include tax-deductions related to equity-based compensation, and certain net-operating loss carryforwards. The adjustment in the tax provision to reflect Adjusted Earnings is shown below (in millions):
Three Months Ended March 31, Year Ended December 31,
2021 2020 2020 2019
GAAP provision for income taxes $ 10.6 $ 4.8 $ 37.0 $ 52.4
Income tax adjustment to reflect Adjusted Earnings 0.1 (0.6) 11.8 23.1
Provision for income taxes for Adjusted Earnings $ 10.7 $ 4.2 $ 48.8 $ 75.5
(2) Primarily represents Cantor and/or BGC's pro-rata portion of Newmark's net income and the noncontrolling portion of Newmark's net income in subsidiaries which are not wholly owned.
(3) The components of equity-based compensation and allocations of net income to limited partnership units and FPUs are as follows (in millions):
Three Months Ended March 31, Year Ended December 31,
2021 2020 2020 2019
Issuance of common stock and exchangeability expenses $ 1.2 $ 8.1 $ 69.0 $ 181.7
Allocations of net income 10.6 0.5 30.5 50.4
Limited partnership units amortization (0.6) 2.0 18.7 21.5
RSU Amortization Expense 2.9 2.3 12.6 5.2
Equity-based compensation and allocations of net income to limited partnership units and FPUs $ 14.1 $ 12.9 $ 130.8 $ 258.8
(4) Includes compensation expenses related to severance charges as a result of the cost savings initiatives of $0,7 million and $0.4 million for the three months ended March 31, 2021 and 2020, respectively. Also includes commission charges related to non-cash GAAP gains attributable to OMSR revenues of $0.2 million for the three months ended March 31, 2021 and 2020.
(5) Includes Non-cash GAAP charges related to the amortization of intangibles with respect to acquisitions.
(6) Adjusted Earnings calculations exclude non-cash GAAP amortization of mortgage servicing rights (which Newmark refers to as "MSRs"). Subsequent to the initial recognition at fair value, MSRs are carried at the lower of amortized cost or fair value and amortized in proportion to the net servicing revenue expected to be earned. However, it is expected that any cash received with respect to these servicing rights, net of associated expenses, will increase Adjusted Earnings in future periods.
(7) Includes $(0,2) million and $0.3 million of an impairment of fixed assets as a result of the cost-savings initiatives for the three months ended March 31, 2021 and 2020, respectively. For the three months ended March 31, 2021 includes $1.3 million of charges the company does not consider a part of its on going operations. Includes $12.8 million of acquisition earnout reversals for the three months ended March 31, 2020.
(8) Adjusted Earnings calculations exclude non-cash GAAP gains attributable to originated mortgage servicing rights (which Newmark refers to as "OMSRs"). Under GAAP, Newmark recognizes OMSRs equal to the fair value of servicing rights retained on mortgage loans originated and sold.
(9) The components of non-cash, non-dilutive, non-economic items are as follows (in millions):
Three Months Ended March 31, Year Ended December 31,
2021 2020 2020 2019
Unrealized mark-to-market (gains)/losses for the Nasdaq forward and other Nasdaq adjustments, net $ 5.6 $ (21.1) $ (6.2) $ 36.3
Mark-to-market (gains)/losses on non-marketable investments, net - 16.8 84.2 (12.1)
Contingent consideration and other expenses - 0.8 0.3 2.1
$ 5.6 $ (3.5) $ 78.3 $ 26.3
(10) Excludes the noncontrolling portion of Newmark's net income in subsidiaries which are not wholly owned.
(11) Includes a reduction for dividends on preferred stock or exchangeable preferred partnership units of $1.6 million and $2.4 million for the three months March 31, 2021 and 2020, respectively.. (see Note 1 - and Basis of Presentation" in the Company's most recently filed Form 10-Q or Form 10-K.)

Hist. Recon GAAP to AE Detail

NEWMARK GROUP, INC.
RECONCILIATION OF GAAP INCOME (LOSS) TO ADJUSTED EARNINGS AND
GAAP FULLY DILUTED EPS TO POST-TAX ADJUSTED EPS
(in thousands, except per share data)
(unaudited)
2021 2020 2019 2018
Q1 Q1 Q2 Q3 Q4 YTD Q1 Q2 Q3 Q4 YTD Q1 Q2 Q3 Q4 YTD
Net income (loss) available to common stockholders $ 33,105 $ 8,179 $ 314 $ 75,348 $ (3,781) $ 80,060 $ 16,904 $ 22,668 $ 88,698 $ (10,965) $ 117,305 $ 19,997 $ 739 $ 68,237 $ 17,759 $ 106,732
Provision (benefit) for income taxes 10,579 4,797 88 33,273 (1,165) 36,993 6,687 9,121 36,760 (132) 52,436 6,933 10,822 35,870 36,862 90,487
Net income (loss) attributable to noncontrolling interest in subsidiaries 11,473 6,056 330 24,177 (1,346) 29,217 6,502 9,396 33,871 (5,362) 44,407 12,490 3,555 47,321 21,800 85,166
GAAP income (loss) before income taxes and noncontrolling interests $ 55,157 $ 19,032 $ 732 $ 132,798 $ (6,292) $ 146,270 $ 30,093 $ 41,185 $ 159,329 $ (16,459) $ 214,148 $ 39,420 $ 15,116 $ 151,428 $ 76,421 $ 282,385
Pre-tax adjustments:
Compensation adjustments:
Equity-based compensation and allocations of net income to limited partnership units and FPUs 14,248 12,914 10,860 50,770 56,215 130,759 13,871 39,353 56,647 148,965 258,836 17,416 67,367 40,777 99,083 224,643
Reserves on employee loans - - - - - - - - - - - - - - - -
Other compensation adjustments 917 564 1,843 5,147 6,727 14,281 14,282 (537) (303) (621) 4,471 3,010 (709) (512) (673) (893) (2,787)
Total Compensation adjustments 15,165 13,478 12,703 55,917 62,942 145,040 13,334 39,050 56,026 153,436 261,846 16,707 66,855 40,104 98,190 221,856
Non-Compensation expense adjustments:
Amortization of intangibles 1,666 1,643 1,667 1,744 1,958 7,012 1,276 1,299 2,819 1,526 6,920 1,513 1,257 1,238 1,621 5,629
MSR amortization 15,067 39,471 23,864 22,602 25,315 111,252 22,126 27,730 29,546 22,128 101,530 17,824 15,726 21,011 23,862 78,423
Other non-compensation adjustments 1,132 (12,480) 1,536 1,585 13,060 3,701 - 0 - 0 - 0 8,601 8,601 - 0 - 0 - 0 - 0 - 0
Total Non-Compensation expense adjustments 17,865 28,634 27,067 25,931 40,333 121,965 23,402 29,029 32,365 32,255 117,051 19,337 16,983 22,249 25,483 84,052
Non-cash adjustment for OMSR Revenue (28,716) (29,347) (42,128) (60,947) (62,392) (194,814) (16,378) (24,855) (37,423) (30,592) (109,248) (21,097) (24,695) (28,685) (28,725) (103,202)
Other (income) losses
Other non-cash, non-dilutive, non-economic items 5,602 (3,514) 32,511 (14,146) 63,486 78,337 13,861 11,940 (22,019) 22,585 26,367 168 3,085 (8,479) (23,618) (28,844)
Total Other (income) losses: 5,602 (3,514) 32,511 (14,146) 63,486 78,337 13,861 11,940 (22,019) 22,585 26,367 168 3,085 (8,479) (23,618) (28,844)
Total pre-tax adjustments 9,916 9,251 30,153 6,755 104,369 150,528 34,219 55,164 28,949 177,684 296,016 15,115 62,228 25,189 71,330 173,862
Adjusted Earnings before noncontrolling interests and taxes $ 65,073 $ 28,283 $ 30,885 $ 139,553 $ 98,077 $ 296,798 $ 64,312 $ 96,349 $ 188,278 $ 161,225 $ 510,164 $ 54,535 $ 77,344 $ 176,617 $ 147,751 $ 456,247
GAAP net income (loss) available to common stockholders $ 33,105 $ 8,179 $ 314 $ 75,348 $ (3,781) $ 80,060 $ 16,904 $ 22,668 $ 88,698 $ (10,965) $ 117,305 $ 19,997 $ 739 $ 68,237 $ 17,759 $ 106,732
Allocation of net income (loss) to noncontrolling interest in subsidiaries 10,814 5,601 118 24,185 (1,890) 28,014 6,639 9,054 33,287 (5,740) 43,240 11,687 3,311 46,906 21,542 83,446
Total pre-tax adjustments (from above) 9,916 9,251 30,153 6,755 104,369 150,528 34,219 55,164 28,949 177,684 296,016 15,115 62,228 25,189 71,330 173,862
Income tax adjustment to reflect adjusted earnings taxes (93) 638 (4,478) 12,341 (20,260) (11,759) (2,578) (6,486) 8,518 (22,526) (23,072) (321) 588 12,452 10,082 22,801
Post-tax Adjusted Earnings $ 53,742 $ 23,669 $ 26,107 $ 118,629 $ 78,438 $ 246,843 $ 55,184 $ 80,400 $ 159,452 $ 138,453 $ 433,489 $ 46,478 $ 66,866 $ 152,784 $ 120,713 $ 386,841
Per Share Data:
GAAP fully diluted earnings per share 0.16 0.03 (0.01) 0.39 (0.03) 0.39 $ 0.08 $ 0.11 $ 0.48 $ (0.08) $ 0.58 $ 0.12 0.00 $ 0.43 $ 0.09 $ 0.65
Less: Allocations of net income to limited partnership units and FPUs, net of tax 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.01 (0.01) 0.00 0.01 0.01
Exchangeable preferred limited partnership units non-cash preferred dividends 0.01 0.01 0.01 0.00 0.01 0.05 0.01 0.01 0.01 0.01 0.05 0.00 0.00 0.01 0.01 0.02
Total pre-tax adjustments (from above) 0.04 0.03 0.11 0.01 0.39 0.57 0.13 0.20 0.11 0.67 1.12 0.07 0.24 0.10 0.27 0.68
Income tax adjustment to reflect adjusted earnings taxes 0.00 0.00 (0.02) 0.05 (0.08) (0.04) (0.01) (0.02) 0.03 (0.09) (0.09) (0.01) 0.00 0.05 0.04 0.08
Other (0.01) 0.02 0.01 (0.01) 0.01 (0.04) 0.00 0.00 (0.04) 0.01 (0.05) 0.00 0.03 (0.01) 0.03 0.07
Post-tax adjusted earnings per share as restated (1) $ 0.20 $ 0.09 $ 0.10 $ 0.44 $ 0.30 $ 0.93 $ 0.21 $ 0.30 $ 0.59 $ 0.52 $ 1.61 $ 0.19 $ 0.26 $ 0.58 $ 0.45 $ 1.51
Fully diluted weighted-average shares of common stock outstanding 271,194 263,646 265,640 266,793 264,868 264,851 269,057 270,966 268,350 264,548 268,860 246,834 258,703 262,532 267,626 258,997
Dividends declared per share of common stock $ 0.01 $ 0.10 $ 0.01 $ 0.01 $ 0.01 $ 0.13 $ 0.10 $ 0.10 $ 0.10 $ 0.10 $ 0.40 $ 0.09 $ 0.09 $ 0.09 $ 0.09 $ 0.36
Dividends paid per share of common stock $ 0.01 $ 0.10 $ 0.01 $ 0.01 $ 0.01 $ 0.13 $ 0.09 $ 0.10 $ 0.10 $ 0.10 $ 0.39 $ 0.00 $ 0.09 $ 0.09 $ 0.09 $ 0.27
(1) Historical quarterly Adjusted EPS for 2017-2018 have been revised to due an immaterial rounding error. Three quarters were impacted by the correction of this immaterial error: Q1 2017 was amended from $0.16 to $0.15; Q3 2017 was amended from $0.53 to $0.54, and Q3 2018 was amended from $0.59 to $0.58. Full year amounts are unchanged.

EBITDA-PR

NEWMARK GROUP, INC.
Reconciliation of GAAP Income (Loss) to Adjusted EBITDA(1)
(in thousands)
(unaudited)
Three Months Ended March 31, Year Ended December 31,
2021 2020 2020 2019
GAAP net income (loss) available to common stockholders $ 33,105 $ 8,182 $ 80,060 $ 117,305
Adjustments:
Net income attributable to noncontrolling interests(1) 11,473 6,056 29,217 44,407
Provision for income taxes 10,579 4,797 36,993 52,436
OMSR revenue(2) (28,716) (29,347) (194,814) (109,248)
MSR amortization(3) 15,067 39,471 111,252 101,530
Other depreciation and amortization(4) 5,986 6,568 29,941 29,614
Equity-based compensation and allocations of net income to limited partnership units and FPUs (5) 14,248 12,914 130,759 258,836
Other adjustments (6) 1,591 (12,229) 11,017 3,010.00
Other non-cash, non-dilutive, non-economic items(7) 5,602 (3,514) 78,706 26,367
Interest expense 10,344 10,904 44,600 39,902
Adjusted EBITDA $ 79,279 $ 43,802 $ 357,731 $ 564,159
(1) Primarily represents Cantor and/or BGC's pro-rata portion of Newmark's net income and the noncontrolling portion of Newmark's net income in subsidiaries which are not wholly owned.
(2) Non-cash gains attributable to originated mortgage servicing rights.
(3) Non-cash amortization of mortgage servicing rights in proportion to the net servicing revenue expected to be earned.
(4) Includes fixed asset depreciation of $4.3 million and $4.6 million for the three months ended March 31, 2021 and 2020, respectively. Also includes intangible asset amortization and impairments related to acquisitions of $1.7 million and $1.6 million for the three months ended March 31, 2021 and 2020, respectively. Included in fixed asset depreciation is an asset impairment as a result of the cost savings initiatives of $(0.2) million and $0.3 million for the three months ended March 31, 2021 and 2020, respectively.
(5) Please refer to Footnote 3 under Reconciliation of GAAP Net Income (Loss) Available to Common Stockholders to Adjusted Earnings Before Noncontrolling Interests and GAAP Fully Diluted EPS to Post-tax Adjusted EPS for additional information about the components of "Equity-based compensation and allocations of net income to limited partnership units and FPUs".
(6) Includes $0.7 million and $0.4 million of severance as a result of the cost-savings initiative for the three months ended March 31, 2021 and 2020. Also includes commission charges related to non-cash GAAP gains attributable to OMSR revenues of $0.2 million for the three months ended March 31, 2021 and 2020y. For the three months ended March 31, 2021, includes $0.7 million of charges the Company does not consider a part of its on going operatations. For the three months ended March 31, 2020, includes $12.8 million of acquisition earnout reversals.
(7) Please refer to Footnote 9 under Reconciliation of GAAP Net Income Available to Common Stockholders to Adjusted Earnings Before Noncontrolling Interests and GAAP Fully Diluted EPS to Post-tax Adjusted EPS for additional information about the components of Other non-cash, non-dilutive, non-economic items".

Historical EBITDA Trend Detail

NEWMARK GROUP, INC.
Reconciliation of GAAP Income (Loss) to Adjusted EBITDA
(in thousands)
(unaudited)
2021 2020 2019 2018
Q1 Q1 Q2 Q3 Q4 YTD Q1 Q2 Q3 Q4 YTD Q1 Q2 Q3 Q4 FY
2020 2020 2020 2020 2020 2019 2019 2019 2019 2019 2018 2018 2018 2018 2018
GAAP net income (loss) available to common stockholders $ 33,105 $ 8,182 $ 310 $ 75,349 $ (3,781) $ 80,060 $ 16,904 $ 22,668 $ 88,698 $ (10,965) $ 117,305 $ 19,997 $ 739 $ 68,237 $ 17,759 $ 106,732
Adjustments:
Net income (loss) attributable to noncontrolling interest in subsidiaries 11,473 6,056 331 24,176 (1,346) 29,217 6,502 9,396 33,871 (5,362) 44,407 12,490 3,555 47,321 21,800 85,166
Provision (benefit) for income taxes 10,579 4,797 89 33,272 (1,165) 36,993 6,687 9,121 36,760 (132) 52,436 6,933 10,822 35,870 36,862 90,487
OMSR Revenue (28,716) (29,347) (42,129) (60,947) (62,392) (194,815) (16,378) (24,855) (37,423) (30,592) (109,248) (21,097) (24,695) (28,685) (28,725) (103,202)
MSR Amortization 15,067 39,471 23,865 22,601 25,315 111,252 22,126 27,730 29,546 22,128 101,530 17,824 15,726 21,011 23,862 78,423
Other Depreciation and Amortization 5,986 6,568 5,082 7,026 11,265 29,941 6,178 5,695 7,235 10,507 29,615 4,688 4,475 4,862 5,286 19,311
Equity-based compensation and allocations of net income to limited partnership units 14,248 12,914 10,861 50,769 56,215 130,759 13,871 39,353 56,647 148,965 258,836 17,416 67,367 40,777 99,083 224,643
Other adjustments 1,591 (12,229) 3,394 5,642 14,209 11,016 (537) (303) (621) 4,471 3,010 (709) (512) (673) (893) (2,787)
Other non-cash, non-dilutive, non-economic items 5,602 (3,514) 32,512 (14,146) 63,855 78,707 13,861 11,940 (22,019) 22,585 26,367 (1) 3,083 (8,479) (30,572) (35,969)
Interest expense 10,344 10,904 11,756 11,244 10,696 44,600 9,567 10,088 10,177 10,070 39,902 14,820 12,915 14,264 16,808 58,807
Adjusted EBITDA $ 79,279 $ 43,802 $ 46,071 $ 154,986 $ 112,871 $ 357,730 $ 78,781 $ 110,833 $ 202,871 $ 171,675 $ 564,160 $ 72,361 $ 93,475 $ 194,505 $ 161,270 $ 521,611

FD WACSO GAAP & AE PR

NEWMARK GROUP, INC.
FULLY DILUTED WEIGHTED-AVERAGE SHARE COUNT
FOR GAAP AND ADJUSTED EARNINGS
(in thousands)
(unaudited)
Three Months Ended December 31, Year Ended December 31, Nine Months Ended September 30,
2021 2020 2020 2019 2020 2019
Common stock outstanding 183,254 177,545 179,106 177,774 178,527 178,122
Limited partnership units 55,819 56,277 - 0 - 0 57,972 - 0
Cantor units 23,730 22,841 - 0 - 0 22,807 - 0
Founding partner units 4,007 5,373 - 0 5,583 5,314 5,661
RSUs 3,165 1,370 355 1,290 254 1,231
Newmark exchange shares 1,219 240 229 369 231 399
Fully diluted weighted-average share count for GAAP 271,194 263,646 179,690 185,016 265,104 185,413
Adjusted Earnings Adjustments:
Common stock outstanding - 0 - 0 - 0 - 0 - 0 - 0
Limited partnership units - 0 - 0 57,112 60,772 - 0 61,750
Cantor units - 0 - 0 22,789 23,072 - 0 23,182
Founding partner units - 0 - 0 5,260 - 0 - 0 - 0
RSUs - 0 - 0 - 0 - 0 - 0 - 0
Other - 0 - 0 - 0 - 0 - 0 - 0
Fully diluted weighted-average share count for Adjusted Earnings 271,194 263,646 264,850 268,860 265,104 270,345

Equity-based Compensation

NEWMARK GROUP, INC.
Equity-based compensation and allocations of net income to limited partnership units and FPUs
(in thousands)
(unaudited)
2021 2020 2019 2018
Q1 Q1 Q2 Q3 Q4 YTD Q1 Q2 Q3 Q4 YTD Q1 Q2 Q3 Q4 YTD
2021 2020 2020 2020 2020 2020 2019 2019 2019 2019 2019 2018 2018 2018 2018 2018
Issuance of common stock and exchangeability expenses $ 1,218 $ 8,119 $ 306 $ 13,243 $ 47,373 $ 69,041 $ 661 $ 21,511 $ 17,499 $ 142,043 $ 181,714 $ 21,749 $ 60,334 $ 12,238 $ 85,012 $ 179,333
Allocation of net income 10,681 549 983 29,221 (293) 30,460 6,313 11,601 32,496 - 0 50,410 4,060 4,692 28,824 13,886 51,462
Limited partnership units amortization (600) 1,895 6,011 4,902 5,885 18,693 6,335 5,044 5,239 4,891 21,509 (8,727) 1,805 (800) (217) (7,939)
RSU amortization 2,997 2,351 3,560 3,404 3,250 12,565 562 1,197 1,413 2,031 5,203 334 536 514 404 1,788
Equity based compensation and allocations of net income to limited partnership units and FPUs $ 14,296 $ 12,914 $ 10,860 $ 50,770 $ 56,215 $ 130,759 $ 13,871 $ 39,353 $ 56,647 $ 148,965 $ 258,836 $ 17,416 $ 67,367 $ 40,776 $ 99,085 $ 224,644
Note 1: On November 11, 2019, Newmark revised the Equity-based Compensation tab of the Financial Supplement to include additional historical data. 2Q 2019 was revised due to a reclassification of the individual components of equity-based compensation. "Exchangeability expense" has been renamed "Issuance of common stock and exchangeability expenses."
Note 2: In March 2020, Newmark revised the "Equity-based compensation" caption of the Financial Supplement to stratify "Limited partnership units amortization" and "RSU amortization."

Volumes

Newmark Group, Inc. Quarterly and TTM Volumes
(in $ millions)
2014 2015 2016 Q1 17 Q2 17 Q3 17 Q4 17 2017 Q1 18 Q2 18 Q3 18 Q4 18 2018 Q1 19 Q2 19 Q3 19 Q4 19 2019 Q1 20 Q2 20 Q3 20 Q4 20 2020 Q1 21 Q1 21 vs Q1 20 Change %
Investment Sales (1) 8,340 19,215 28,306 6,899 8,303 8,329 11,497 - 0 35,028 8,472 8,633 9,965 15,200 42,269 9,710 11,259 13,015 16,691 50,675 13,108 4,744 7,456 22,849 48,157 11,678 (1,430) -11%
Mortgage Brokerage (2) 907 4,147 6,190 1,222 3,358 2,238 1,969 - 0 8,787 2,521 3,060 3,177 5,268 14,025 3,617 4,879 4,997 7,206 20,699 4,315 1,296 2,045 4,640 12,296 4,376 61 1%
Total Capital Markets 9,248 23,363 34,496 8,121 11,660 10,567 13,466 - 0 43,815 10,993 11,693 13,141 20,467 56,294 13,327 16,138 18,012 23,897 71,374 17,423 6,040 9,501 27,489 60,453 16,054 (1,369) -8%
Fannie Mae 2,138 2,700 4,443 1,272 982 784 830 - 0 3,869 629 1,254 1,435 1,250 4,567 493 887 942 880 3,202 953 955 1,621 1,892 5,421 711 (242) -25%
Freddie Mac 1,969 2,004 2,941 560 2,933 600 632 - 0 4,726 899 574 1,274 1,235 3,982 1,426 1,080 2,917 1,300 6,723 690 1,463 1,515 2,024 5,692 1,388 698 101%
FHA 123 108 179 21 129 94 19 - 0 264 77 20 - 0 68 165 - 0 12 2 - 0 14 - 0 6 79 107 192 14 14 0%
Total Origination Volume 4,230 4,812 7,564 1,854 4,045 1,479 1,481 - 0 8,858 1,605 1,849 2,709 2,553 8,715 1,919 1,979 3,861 2,180 9,939 1,643 2,424 3,215 4,023 11,305 2,113 470 29%
Total Debt and Capital Markets Volume 13,477 28,175 42,060 9,975 15,705 12,046 14,947 - 0 52,673 12,598 13,542 15,850 23,020 65,010 15,247 18,117 21,873 26,077 81,314 19,066 8,464 12,716 31,512 71,758 18,167 (899) -5%
(1) Includes all equity advisory transactions
(2) Includes all non-originated debt placement transactions