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Altisource Announces Record Results

Altisource Announces Record Results  LUXEMBOURG, July 24, 2014 (GLOBE NEWSWIRE) -- Altisource Portfolio Solutions S.A. ("Altisource") (Nasdaq:ASPS) today reported record second quarter service revenue, net income attributable to shareholders and diluted earnings per share.  Second Quarter 2014 Results Compared to Second Quarter 2013:    *Service revenue of $263.2 million, a 63% increase   *Net income attributable to Altisource of $54.1 million, a 75% increase   *Diluted earnings per share of $2.24, a 79% increase   *Cash from operations of $75.2 million, a 30% increase  "Next month marks our five year anniversary as a stand-alone public company. During this five year period, we have had 43% cumulative annual service revenue growth, 47% cumulative annual earnings growth and have focused on providing best-in-class services, developing new services, driving down costs through efficiency initiatives and investing in our future. This is exactly what we set out to do five years ago," said Chairman William Erbey.  William Shepro, Chief Executive Officer, further commented, "We believe our strategic initiatives, coupled with our strong revenue, earnings and operating cash flow, position us for attractive growth in the next five years and beyond.We plan to continue to invest in our next generation technology, develop our newer services and pursue potential acquisitions, in line with our marketplace strategy.We also plan to continue our share repurchase program when the stock is trading at attractive prices."  Second quarter 2014 highlights include:    *The average number of loans serviced by Ocwen on REALServicing ^ was 2.3     million for the second quarter of 2014, an increase of 118% compared to     the second quarter of 2013   *The average number of delinquent non-Government-Sponsored Enterprise loans     serviced by Ocwen on REALServicing was 352 thousand for the second quarter     of 2014, an increase of 24% compared to the second quarter of 2013   *We repurchased 0.4 million shares of our common stock under our stock     repurchase program at an average price of $108.24 per share during the     second quarter of 2014   *Altisource Residential Corporation, the company we provide rental     management services to, increased its non-performing loan and real estate     owned portfolio from 12,405 at March 31, 2014 to 14,907 at June 30, 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 second 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  Six months ended                                        June 30,            June 30,                                       2014      2013      2014      2013 Service revenue                                                    Mortgage Services                      $ 188,477 $ 119,887 $ 334,971 $ 216,264 Financial Services                     25,436    22,959    49,693    39,091 Technology Services                    57,983    24,783    105,487   45,014 Eliminations                           (8,731)   (5,955)   (17,027)  (11,143)                                       263,165   161,674   473,124   289,226 Reimbursable expenses                  32,276    23,299    61,071    43,565 Non-controlling interests              631       1,137     1,146     2,146 Total revenue                          296,072   186,110   535,341   334,937 Cost of revenue                        151,723   93,673    270,733   170,369 Reimbursable expenses                  32,276    23,299    61,071    43,565 Gross profit                           112,073   69,138    203,537   121,003 Selling, general and administrative    49,021    29,828    92,555    48,508 expenses Income from operations                 63,052    39,310    110,982   72,495 Other income (expense), net:                                       Interest expense                       (4,784)   (4,902)   (9,560)   (8,114) Other income (expense), net            (43)      77        4         782 Total other income (expense), net      (4,827)   (4,825)   (9,556)   (7,332) Income before income taxes and         58,225    34,485    101,426   65,163 non-controlling interests Income tax provision                   (3,493)   (2,417)   (6,548)   (4,568) Net income                             54,732    32,068    94,878    60,595 Net income attributable to             (631)     (1,137)   (1,146)   (2,146) non-controlling interests                                       $ 54,101  $ 30,931  $ 93,732  $ 58,449 Net income attributable to Altisource                                                                   Earnings per share:                                                Basic                                  $ 2.45    $ 1.34    $ 4.20    $ 2.51 Diluted                                $ 2.24    $ 1.25    $ 3.84    $ 2.34                                                                   Weighted average shares outstanding:                               Basic                                  22,089    23,161    22,301    23,267 Diluted                                24,166    24,823    24,415    24,940                                                                                                                                      ALTISOURCE PORTFOLIO SOLUTIONS S.A.  CONSOLIDATED BALANCE SHEETS (in thousands, except per share data) (unaudited)                                                       June 30,   December 31,                                                      2014       2013 ASSETS                                                                 Current assets: Cash and cash equivalents                             $ 127,884  $ 130,429 Accounts receivable, net                              125,047    104,787 Prepaid expenses and other current assets             16,022     10,891 Deferred tax assets, net                              2,837      2,837 Total current assets                                 271,790    248,944 Premises and equipment, net                           100,962    87,252 Deferred tax assets, net                              160        622 Intangible assets, net                                256,889    276,162 Goodwill                                              61,941     99,414 Other assets                                          19,258     17,658                                                                 Total assets                                          $ 711,000  $ 730,052  LIABILITIES AND EQUITY Current liabilities:                                             Accounts payable and accrued expenses                 $ 102,686  $ 84,706 Current portion of long-term debt                     3,975      3,975 Deferred revenue                                      21,785     36,742 Other current liabilities                             8,957      10,131 Total current liabilities                            137,403    135,554                                                                 Long-term debt, less current portion                  389,385    391,281 Other non-current liabilities                         11,733     45,476                                                                 Equity: Common stock ($1.00 par value; 100,000 shares authorized; 25,413 issued and 21,941 outstanding as of June 30,   25,413     25,413 2014; 25,413 issued and 22,629 outstanding as of December 31, 2013) Additional paid-in capital                            90,403     89,273 Retained earnings                                     330,361    239,561 Treasury stock, at cost (3,472 shares as of June 30, 2014 and                                              (274,679)  (197,548) 2,784 shares as of December 31, 2013) Altisource equity                                    171,498    156,699                                                                 Non-controlling interests                             981        1,042 Total equity                                         172,479    157,741                                                      $ 711,000  $ 730,052 Total liabilities and equity    ALTISOURCE PORTFOLIO SOLUTIONS S.A.  CONSOLIDATED STATEMENTS OF CASH FLOWS (in thousands) (unaudited)                                                      Six months ended June 30,                                                     2014         2013                                                                  Cash flows from operating activities: Net income                                           $ 94,878     $ 60,595 Adjustments to reconcile net income to net cash                   provided by operating activities: Depreciation and amortization                        13,375       9,306 Amortization of intangible assets                    19,573       10,237 Changes in the fair value of Equator Earn Out        (37,924)     -- Goodwill impairment                                  37,473       -- Share-based compensation expense                     1,130        1,519 Equity in losses of investment in affiliate          --           122 Bad debt expense                                     4,250        452 Amortization of debt discount                        90           152 Amortization of debt issuance costs                  483          451 Deferred income taxes                                462          -- Loss on disposal of fixed assets                     98           926 Changes in operating assets and liabilities, net of               effects of acquisitions: Accounts receivable                                  (24,510)     (10,813) Prepaid expenses and other current assets            (5,131)      (3,009) Other assets                                         (2,089)      (1,440) Accounts payable and accrued expenses                21,319       917 Other current and non-current liabilities            (11,950)     (1,947) Net cash provided by operating activities            111,527      67,468                                                                  Cash flows from investing activities: Additions to premises and equipment                  (30,522)     (13,397) Acquisition of businesses, net of cash acquired      --           (215,700) Proceeds from loan to Ocwen                          --           75,000 Proceeds from sale of equity affiliate               --           12,648 Other investing activities                           (294)        (50) Net cash used in investing activities                (30,816)     (141,499)                                                                  Cash flows from financing activities:                             Proceeds from issuance of long-term debt             --           201,000 Repayment of long-term debt and payments on capital  (1,986)      (1,733) lease obligations Debt issuance costs                                  --           (2,400) Proceeds from stock option exercises                 639          2,914 Purchase of treasury stock                           (80,702)     (51,573) Contributions from non-controlling interests         --           15 Distributions to non-controlling interests           (1,207)      (1,889) Net cash (used in) provided by financing activities  (83,256)     146,334                                                                                                                                   Net (decrease) increase in cash and cash equivalents (2,545)      72,303 Cash and cash equivalents at the beginning of the    130,429      105,502 period Cash and cash equivalents at the end of the period   $ 127,884    $ 177,805                                                                  Supplemental cash flow information:                               Interest paid                                        $ 9,074      $ 7,562 Income taxes paid, net                               1,561        1,165                                                                  Non-cash investing and financing activities:                      (Decrease) increase in payables for purchases of     $ (3,339)    $ 891 premises and equipment (Decrease) increase in acquisition of businesses     (3,711)      11,133 from subsequent working capitaltrue-ups  CONTACT: Michelle D. Esterman          Chief Financial Officer          T:  +352 2469 7950          E:  Michelle.Esterman@altisource.lu  
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