Altisource Announces Record Results

Altisource Announces Record Results

LUXEMBOURG, April 24, 2014 (GLOBE NEWSWIRE) -- Altisource Portfolio Solutions
S.A. ("Altisource") (Nasdaq:ASPS) today reported record service revenue, net
income attributable to shareholders and diluted earnings per share. The
quarter over quarter growth in service revenue and net income was primarily
driven by the higher number of loans that were boarded on REALServicing in
2013 and the inclusion of a full quarter of Equator, LLC operations.

First Quarter 2014 Results Compared to First Quarter 2013:

  *Service revenue of $210.0 million, a 65% increase
  *Net income attributable to Altisource of $39.6 million, a 44% increase
  *Diluted earnings per share of $1.61, a 46% increase
  *Cash from operations of $36.3 million, a 280% increase

"Altisource had a very strong quarter, marking the 12^th straight quarter of
sequential service revenue growth. To maintain this trend, we remain focused
on executing against our strategic plan," said Chairman William Erbey.

William Shepro, Chief Executive Officer, further commented, "We are focused on
providing high quality, compliant services to our customers while diligently
executing on our 2014 strategic initiatives to diversify our customer base and
grow our revenue and earnings. Our strong cash flow generation provides us the
ability to invest in our next generation technologies, acquire businesses that
advance our strategic objectives and repurchase our common stock."

First quarter 2014 highlights include:

  *Gross profit as a percentage of service revenue was 44% for the quarter,
    an increase from 41% for the same quarter in 2013 driven by margin
    expansion in all of the Company's operating segments
  *The average number of delinquent non-Government Sponsored Enterprise loans
    serviced by Ocwen on REALServicing totaled 369 thousand for the three
    months ended March 31, 2014, an increase of 57% compared to the three
    months ended March 31, 2013
  *We repurchased 0.3 million shares of our common stock under our stock
    repurchase program at an average price of $109.97 per share during the
    three months ended March 31, 2014

Forward-Looking Statements

This press release contains forward-looking statements that involve a number
of risks and uncertainties. Those forward-looking statements include all
statements that are not historical fact, including statements about
management's beliefs and expectations. Forward-looking statements are based on
management's beliefs as well as assumptions made by and information currently
available to management. Because such statements are based on expectations as
to future economic performance and are not statements of historical fact,
actual results may differ materially from those projected. The Company
undertakes no obligation to update any forward-looking statements whether as a
result of new information, future events or otherwise. The risks and
uncertainties to which forward-looking statements are subject include, but are
not limited to: Altisource's ability to retain existing customers and attract
new customers; general economic and market conditions; governmental
regulations, taxes and policies; availability of adequate and timely sources
of liquidity and other risks and uncertainties detailed in the
"Forward-Looking Statements," "Risk Factors" and other sections of the
Company's Form 10-K and other filings with the Securities and Exchange
Commission.

Webcast

Altisource will host a webcast at 11:00 a.m. EDT today to discuss our first
quarter results. A link to the live audio webcast will be available on the
Company's website through the Investor Relations home page. Those who want to
listen to the call should go to the website fifteen minutes prior to the call
to register, download and install any necessary audio software. A replay of
the conference call will be available via the website approximately two hours
after the conclusion of the call and will remain available for approximately
30 days.

About Altisource

Altisource is a premier marketplace and transaction solutions provider for the
real estate, mortgage and consumer debt industries offering both distribution
and content. We leverage proprietary business process, vendor and electronic
payment management software and behavioral science based analytics to improve
outcomes for marketplace participants. Additional information is available at
www.altisource.com.

ALTISOURCE PORTFOLIO SOLUTIONS S.A.

CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)
(unaudited)
                                                                  
                                                        Three months ended
                                                         March 31,
                                                        2014       2013
                                                                  
Service revenue                                                    
Mortgage Services                                        $146,494 $96,377
Financial Services                                       24,257     16,132
Technology Services                                      47,504     20,231
Eliminations                                             (8,296)    (5,188)
                                                        209,959    127,552
Reimbursable expenses                                    28,795     20,266
Non-controlling interests                                515        1,009
Total revenue                                            239,269    148,827
Cost of revenue                                          119,010    76,696
Reimbursable expenses                                    28,795     20,266
Gross profit                                             91,464     51,865
Selling, general and administrative expenses             43,534     18,680
Income from operations                                   47,930     33,185
Other income (expense), net:                                       
Interest expense                                         (4,776)    (3,212)
Other income (expense), net                              47         705
Total other income (expense), net                        (4,729)    (2,507)
Income before income taxes and non-controlling interests 43,201     30,678
Income tax provision                                     (3,055)    (2,151)
Net income                                               40,146     28,527
Net income attributable to non-controlling interests     (515)      (1,009)
                                                                  
Net income attributable to Altisource                    $39,631  $27,518
                                                                  
Earnings per share:                                                
Basic                                                   $1.76    $1.18
Diluted                                                  $1.61    $1.10
                                                                  
Weighted average shares outstanding:                               
Basic                                                   22,509     23,374
Diluted                                                  24,662     25,058
                                                                  
Transactions with related parties:                                 
Revenue                                                  $145,558 $90,098
Selling, general and administrative expenses             829        673
Other income                                             --         773


ALTISOURCE PORTFOLIO SOLUTIONS S.A.

CONSOLIDATED BALANCE SHEETS
(in thousands, except per share data)
(unaudited)
                                                                
                                                      March 31,  December 31,
                                                       2014       2013
ASSETS                                                           
                                                                
Current assets:                                                  
Cash and cash equivalents                              $116,376 $130,324
Accounts receivable, net                               122,141    101,297
Prepaid expenses and other current assets              13,236     11,389
Deferred tax assets, net                               2,837      2,837
Total current assets                                   254,590    245,847
                                                                
Premises and equipment, net                            94,539     87,252
Deferred tax assets, net                               160        622
Intangible assets, net                                 266,996    276,162
Goodwill                                              99,414     99,414
Other assets                                          18,352     17,580
                                                                
Total assets                                           $734,051 $726,877
                                                                
LIABILITIES AND EQUITY                                           
                                                                
Current liabilities:                                             
Accounts payable and accrued expenses                  $89,909  $81,531
Current portion of long-term debt                      3,975      3,975
Deferred revenue                                       30,206     36,742
Other current liabilities                             10,404     10,131
Total current liabilities                              134,494    132,379
                                                                
Long-term debt, less current portion                   390,333    391,281
Other non-current liabilities                          46,697     45,476
                                                                
Equity:                                                          
Common stock ($1.00 par value; 100,000 shares
authorized;
25,413 issued and 22,337 outstanding as of March 31,   25,413     25,413
2014;
25,413 issued and 22,629 outstanding as of December
31, 2013)
Additional paid-in capital                             89,931     89,273
Retained earnings                                      277,460    239,561
Treasury stock, at cost (3,076 shares as of March 31,
2014                                                   (231,181)  (197,548)
and 2,784 shares as of December 31, 2013)
Altisource equity                                      161,623    156,699
                                                                
Non-controlling interests                              904        1,042
Total equity                                           162,527    157,741
Total liabilities and equity                           $734,051 $726,877


ALTISOURCE PORTFOLIO SOLUTIONS S.A.
                                                               
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
(unaudited)
                                                               
                                                 Three months ended March 31,
                                                 2014           2013
                                                               
Cash flows from operating activities:                           
Net income                                        $40,146      $28,527
Adjustments to reconcile net income to net cash                 
provided by operating activities:
Depreciation and amortization                     6,246          4,724
Amortization of intangible assets                 9,466          1,200
Share-based compensation expense                  658            1,424
Equity in losses of investment in affiliate       --             176
Bad debt expense                                  1,755          224
Amortization of debt discount                     46             95
Amortization of debt issuance costs               242            215
Deferred income taxes                             461            --
Loss on sale or disposal of fixed assets          96             --
Changes in operating assets and liabilities, net                
of effects of acquisitions:
Accounts receivable                               (22,599)       (12,968)
Prepaid expenses and other current assets         (1,847)        (1,147)
Other assets                                      (1,014)        (1,741)
Accounts payable and accrued expenses             7,695          (7,805)
Other current and non-current liabilities         (5,042)        (3,368)
Net cash provided by operating activities         36,309         9,556
                                                               
Cash flows from investing activities:                           
Additions to premises and equipment               (12,945)       (6,960)
Acquisition of businesses, net of cash acquired   --             (75,817)
Proceeds from loan to Ocwen                       --             75,000
Other investing activities                        (300)          (50)
Net cash used in investing activities             (13,245)       (7,827)
                                                               
Cash flows from financing activities:                           
Repayment of long-term debt                       (994)          (500)
Principal payments on capital lease obligations   --             (176)
Proceeds from stock option exercises              401            456
Purchase of treasury stock                        (35,766)       (21,997)
Contributions from non-controlling interests      --             12
Distributions to non-controlling interests        (653)          (1,090)
Net cash used in financing activities             (37,012)       (23,295)
                                                               
                                                               
Decrease in cash and cash equivalents             (13,948)       (21,566)
Cash and cash equivalents at the beginning of the 130,324        105,502
period
                                                               
Cash and cash equivalents at the end of the       $116,376     $83,936
period
                                                               
Supplemental cash flow information:                             
Interest paid                                     $4,469       $2,799
Income taxes paid, net                            201            402
                                                               
Non-cash investing and financing activities:                    
Premises and equipment purchased on account       $684         $700

CONTACT: Michelle D. Esterman
         Chief Financial Officer
         T:  +352 2469 7950
         E:  Michelle.Esterman@altisource.lu
 
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