10-Q 1 rmax-20230930x10q.htm 10-Q
P3MP1YP1YP1YP1YP1YP3MP1YP1YP1YP1YP1YP3MP1YP1YP1YP1YP1Y0001581091--12-312023Q3false111821349717874238P0Y0001581091us-gaap:CommonClassAMember2022-01-310001581091us-gaap:RetainedEarningsMember2023-09-300001581091us-gaap:NoncontrollingInterestMember2023-09-300001581091us-gaap:AdditionalPaidInCapitalMember2023-09-300001581091us-gaap:AccumulatedOtherComprehensiveIncomeMember2023-09-300001581091us-gaap:RetainedEarningsMember2023-06-300001581091us-gaap:NoncontrollingInterestMember2023-06-300001581091us-gaap:AdditionalPaidInCapitalMember2023-06-300001581091us-gaap:AccumulatedOtherComprehensiveIncomeMember2023-06-3000015810912023-06-300001581091us-gaap:RetainedEarningsMember2023-03-310001581091us-gaap:NoncontrollingInterestMember2023-03-310001581091us-gaap:AdditionalPaidInCapitalMember2023-03-310001581091us-gaap:AccumulatedOtherComprehensiveIncomeMember2023-03-3100015810912023-03-310001581091us-gaap:RetainedEarningsMember2022-12-310001581091us-gaap:NoncontrollingInterestMember2022-12-310001581091us-gaap:AdditionalPaidInCapitalMember2022-12-310001581091us-gaap:AccumulatedOtherComprehensiveIncomeMember2022-12-310001581091us-gaap:RetainedEarningsMember2022-09-300001581091us-gaap:NoncontrollingInterestMember2022-09-300001581091us-gaap:AdditionalPaidInCapitalMember2022-09-300001581091us-gaap:AccumulatedOtherComprehensiveIncomeMember2022-09-300001581091us-gaap:RetainedEarningsMember2022-06-300001581091us-gaap:NoncontrollingInterestMember2022-06-300001581091us-gaap:AdditionalPaidInCapitalMember2022-06-300001581091us-gaap:AccumulatedOtherComprehensiveIncomeMember2022-06-300001581091us-gaap:RetainedEarningsMember2022-03-310001581091us-gaap:NoncontrollingInterestMember2022-03-310001581091us-gaap:AdditionalPaidInCapitalMember2022-03-310001581091us-gaap:AccumulatedOtherComprehensiveIncomeMember2022-03-3100015810912022-03-310001581091us-gaap:RetainedEarningsMember2021-12-310001581091us-gaap:NoncontrollingInterestMember2021-12-310001581091us-gaap:AdditionalPaidInCapitalMember2021-12-310001581091us-gaap:AccumulatedOtherComprehensiveIncomeMember2021-12-310001581091rmax:TimeBasedRestrictedStockUnitMember2022-12-310001581091rmax:PerformanceBasedRestrictedStockUnitMember2022-12-310001581091rmax:AnnualDuesMember2029-01-012023-09-300001581091rmax:AnnualDuesMember2028-01-012023-09-300001581091rmax:AnnualDuesMember2027-01-012023-09-300001581091rmax:AnnualDuesMember2026-01-012023-09-300001581091rmax:AnnualDuesMember2025-01-012023-09-300001581091rmax:FranchiseSalesMember2029-01-012023-09-300001581091rmax:FranchiseSalesMember2028-01-012023-09-300001581091rmax:FranchiseSalesMember2023-10-012023-09-300001581091rmax:FranchiseSalesMember2027-01-012023-09-300001581091rmax:FranchiseSalesMember2026-01-012023-09-300001581091rmax:FranchiseSalesMember2025-01-012023-09-300001581091rmax:FranchiseSalesMember2024-01-012023-09-300001581091rmax:AnnualDuesMember2023-10-012023-09-300001581091rmax:AnnualDuesMember2024-01-012023-09-300001581091rmax:AnnualDuesAndFranchiseSalesMember2029-01-012023-09-300001581091rmax:AnnualDuesAndFranchiseSalesMember2028-01-012023-09-300001581091rmax:AnnualDuesAndFranchiseSalesMember2023-10-012023-09-300001581091rmax:AnnualDuesAndFranchiseSalesMember2027-01-012023-09-300001581091rmax:AnnualDuesAndFranchiseSalesMember2026-01-012023-09-300001581091rmax:AnnualDuesAndFranchiseSalesMember2025-01-012023-09-300001581091rmax:AnnualDuesAndFranchiseSalesMember2024-01-012023-09-300001581091rmax:FranchiseSalesMember2023-09-300001581091rmax:AnnualDuesMember2023-09-300001581091rmax:AnnualDuesAndFranchiseSalesMember2023-09-300001581091rmax:FeeRevenueMemberrmax:GlobalAndOtherMemberrmax:OtherMember2023-07-012023-09-300001581091rmax:FeeRevenueMembercountry:USrmax:OwnedRegionsMember2023-07-012023-09-300001581091rmax:FeeRevenueMembercountry:USrmax:IndependentRegionsMember2023-07-012023-09-300001581091rmax:FeeRevenueMembercountry:CArmax:OwnedRegionsMember2023-07-012023-09-300001581091rmax:FeeRevenueMembercountry:CArmax:IndependentRegionsMember2023-07-012023-09-300001581091rmax:GlobalAndOtherMemberrmax:TotalMarketingFundsMember2023-07-012023-09-300001581091rmax:FranchiseSalesAndOtherRevenueMemberrmax:MortgageMember2023-07-012023-09-300001581091rmax:FranchiseSalesAndOtherRevenueMemberrmax:FranchisingSegmentMember2023-07-012023-09-300001581091rmax:FeeRevenueMemberrmax:FranchisingSegmentMember2023-07-012023-09-300001581091rmax:ContinuingFranchiseFeesMemberrmax:MortgageMember2023-07-012023-09-300001581091rmax:ContinuingFranchiseFeesMemberrmax:FranchisingSegmentMember2023-07-012023-09-300001581091rmax:BrokerFeesMemberrmax:FranchisingSegmentMember2023-07-012023-09-300001581091rmax:AnnualDuesMemberrmax:FranchisingSegmentMember2023-07-012023-09-300001581091country:USrmax:TotalMarketingFundsMember2023-07-012023-09-300001581091country:CArmax:TotalMarketingFundsMember2023-07-012023-09-300001581091rmax:TotalMarketingFundsMember2023-07-012023-09-300001581091rmax:MarketingFundFeesMember2023-07-012023-09-300001581091rmax:MarketingFundFeesMember2023-07-012023-09-300001581091rmax:FranchiseSalesAndOtherRevenueMember2023-07-012023-09-300001581091rmax:ContinuingFranchiseFeesMember2023-07-012023-09-300001581091rmax:BrokerFeesMember2023-07-012023-09-300001581091rmax:AnnualDuesMember2023-07-012023-09-300001581091rmax:FeeRevenueMemberrmax:GlobalAndOtherMemberrmax:OtherMember2023-01-012023-09-300001581091rmax:FeeRevenueMembercountry:USrmax:OwnedRegionsMember2023-01-012023-09-300001581091rmax:FeeRevenueMembercountry:USrmax:IndependentRegionsMember2023-01-012023-09-300001581091rmax:FeeRevenueMembercountry:CArmax:OwnedRegionsMember2023-01-012023-09-300001581091rmax:FeeRevenueMembercountry:CArmax:IndependentRegionsMember2023-01-012023-09-300001581091rmax:GlobalAndOtherMemberrmax:TotalMarketingFundsMember2023-01-012023-09-300001581091rmax:FranchiseSalesAndOtherRevenueMemberrmax:MortgageMember2023-01-012023-09-300001581091rmax:FranchiseSalesAndOtherRevenueMemberrmax:FranchisingSegmentMember2023-01-012023-09-300001581091rmax:FeeRevenueMemberrmax:FranchisingSegmentMember2023-01-012023-09-300001581091rmax:ContinuingFranchiseFeesMemberrmax:MortgageMember2023-01-012023-09-300001581091rmax:ContinuingFranchiseFeesMemberrmax:FranchisingSegmentMember2023-01-012023-09-300001581091rmax:BrokerFeesMemberrmax:FranchisingSegmentMember2023-01-012023-09-300001581091rmax:AnnualDuesMemberrmax:FranchisingSegmentMember2023-01-012023-09-300001581091country:USrmax:TotalMarketingFundsMember2023-01-012023-09-300001581091country:CArmax:TotalMarketingFundsMember2023-01-012023-09-300001581091rmax:TotalMarketingFundsMember2023-01-012023-09-300001581091rmax:MarketingFundFeesMember2023-01-012023-09-300001581091rmax:MarketingFundFeesMember2023-01-012023-09-300001581091rmax:FranchiseSalesAndOtherRevenueMember2023-01-012023-09-300001581091rmax:ContinuingFranchiseFeesMember2023-01-012023-09-300001581091rmax:BrokerFeesMember2023-01-012023-09-300001581091rmax:AnnualDuesMember2023-01-012023-09-300001581091rmax:FeeRevenueMemberrmax:GlobalAndOtherMemberrmax:OtherMember2022-07-012022-09-300001581091rmax:FeeRevenueMembercountry:USrmax:OwnedRegionsMember2022-07-012022-09-300001581091rmax:FeeRevenueMembercountry:USrmax:IndependentRegionsMember2022-07-012022-09-300001581091rmax:FeeRevenueMembercountry:CArmax:OwnedRegionsMember2022-07-012022-09-300001581091rmax:FeeRevenueMembercountry:CArmax:IndependentRegionsMember2022-07-012022-09-300001581091rmax:GlobalAndOtherMemberrmax:TotalMarketingFundsMember2022-07-012022-09-300001581091rmax:FranchiseSalesAndOtherRevenueMemberrmax:MortgageMember2022-07-012022-09-300001581091rmax:FranchiseSalesAndOtherRevenueMemberrmax:FranchisingSegmentMember2022-07-012022-09-300001581091rmax:FeeRevenueMemberrmax:FranchisingSegmentMember2022-07-012022-09-300001581091rmax:ContinuingFranchiseFeesMemberrmax:MortgageMember2022-07-012022-09-300001581091rmax:ContinuingFranchiseFeesMemberrmax:FranchisingSegmentMember2022-07-012022-09-300001581091rmax:BrokerFeesMemberrmax:FranchisingSegmentMember2022-07-012022-09-300001581091rmax:AnnualDuesMemberrmax:FranchisingSegmentMember2022-07-012022-09-300001581091country:USrmax:TotalMarketingFundsMember2022-07-012022-09-300001581091country:CArmax:TotalMarketingFundsMember2022-07-012022-09-300001581091rmax:TotalMarketingFundsMember2022-07-012022-09-300001581091rmax:MarketingFundFeesMember2022-07-012022-09-300001581091rmax:MarketingFundFeesMember2022-07-012022-09-300001581091rmax:FranchiseSalesAndOtherRevenueMember2022-07-012022-09-300001581091rmax:ContinuingFranchiseFeesMember2022-07-012022-09-300001581091rmax:BrokerFeesMember2022-07-012022-09-300001581091rmax:AnnualDuesMember2022-07-012022-09-300001581091rmax:FeeRevenueMemberrmax:GlobalAndOtherMemberrmax:OtherMember2022-01-012022-09-300001581091rmax:FeeRevenueMembercountry:USrmax:OwnedRegionsMember2022-01-012022-09-300001581091rmax:FeeRevenueMembercountry:USrmax:IndependentRegionsMember2022-01-012022-09-300001581091rmax:FeeRevenueMembercountry:CArmax:OwnedRegionsMember2022-01-012022-09-300001581091rmax:FeeRevenueMembercountry:CArmax:IndependentRegionsMember2022-01-012022-09-300001581091rmax:GlobalAndOtherMemberrmax:TotalMarketingFundsMember2022-01-012022-09-300001581091rmax:FranchiseSalesAndOtherRevenueMemberrmax:MortgageMember2022-01-012022-09-300001581091rmax:FranchiseSalesAndOtherRevenueMemberrmax:FranchisingSegmentMember2022-01-012022-09-300001581091rmax:FeeRevenueMemberrmax:FranchisingSegmentMember2022-01-012022-09-300001581091rmax:ContinuingFranchiseFeesMemberrmax:MortgageMember2022-01-012022-09-300001581091rmax:ContinuingFranchiseFeesMemberrmax:FranchisingSegmentMember2022-01-012022-09-300001581091rmax:BrokerFeesMemberrmax:FranchisingSegmentMember2022-01-012022-09-300001581091rmax:AnnualDuesMemberrmax:FranchisingSegmentMember2022-01-012022-09-300001581091country:USrmax:TotalMarketingFundsMember2022-01-012022-09-300001581091country:CArmax:TotalMarketingFundsMember2022-01-012022-09-300001581091rmax:TotalMarketingFundsMember2022-01-012022-09-300001581091rmax:MarketingFundFeesMember2022-01-012022-09-300001581091rmax:MarketingFundFeesMember2022-01-012022-09-300001581091rmax:FranchiseSalesAndOtherRevenueMember2022-01-012022-09-300001581091rmax:ContinuingFranchiseFeesMember2022-01-012022-09-300001581091rmax:BrokerFeesMember2022-01-012022-09-300001581091rmax:AnnualDuesMember2022-01-012022-09-300001581091rmax:ReorganizationMember2023-09-300001581091rmax:SettlementFundsMember2023-09-300001581091rmax:MarketingFundsMember2023-09-300001581091rmax:MarketingFundsMember2022-12-310001581091us-gaap:DividendPaidMember2023-01-012023-09-300001581091us-gaap:DividendPaidMember2022-01-012022-09-300001581091rmax:TaxAndOtherDistributionsMember2022-01-012022-09-300001581091us-gaap:AccumulatedOtherComprehensiveIncomeMember2023-07-012023-09-300001581091us-gaap:AccumulatedOtherComprehensiveIncomeMember2023-04-012023-06-300001581091us-gaap:AccumulatedOtherComprehensiveIncomeMember2023-01-012023-03-310001581091us-gaap:AccumulatedOtherComprehensiveIncomeMember2022-07-012022-09-300001581091us-gaap:AccumulatedOtherComprehensiveIncomeMember2022-04-012022-06-300001581091us-gaap:AccumulatedOtherComprehensiveIncomeMember2022-01-012022-03-310001581091us-gaap:NoncontrollingInterestMember2023-07-012023-09-300001581091us-gaap:NoncontrollingInterestMember2023-04-012023-06-300001581091us-gaap:NoncontrollingInterestMember2023-01-012023-03-310001581091us-gaap:NoncontrollingInterestMember2022-07-012022-09-300001581091us-gaap:NoncontrollingInterestMember2022-04-012022-06-300001581091us-gaap:NoncontrollingInterestMember2022-01-012022-03-310001581091rmax:SeniorSecuredCreditFacilityRefinancingMemberus-gaap:FairValueInputsLevel2Memberus-gaap:EstimateOfFairValueFairValueDisclosureMember2023-09-300001581091rmax:SeniorSecuredCreditFacilityRefinancingMemberus-gaap:FairValueInputsLevel2Memberus-gaap:EstimateOfFairValueFairValueDisclosureMember2022-12-310001581091rmax:SeniorSecuredCreditFacilityRefinancingMemberus-gaap:CarryingReportedAmountFairValueDisclosureMember2023-09-300001581091rmax:SeniorSecuredCreditFacilityRefinancingMemberus-gaap:CarryingReportedAmountFairValueDisclosureMember2022-12-310001581091rmax:NationwideClaimsMemberus-gaap:SettledLitigationMember2023-09-152023-09-150001581091rmax:MoehrlRelatedAntitrustLitigationsMemberus-gaap:PendingLitigationMember2023-09-072023-09-070001581091rmax:NationwideClaimsMemberus-gaap:SettledLitigationMember2023-01-012023-09-300001581091rmax:MoehrlRelatedAntitrustLitigationsMemberus-gaap:SettledLitigationMember2023-10-012023-10-310001581091us-gaap:RevolvingCreditFacilityMemberrmax:SeniorSecuredCreditFacilityRefinancingMember2021-07-210001581091rmax:TermLoanMemberrmax:SeniorSecuredCreditFacilityRefinancingMember2021-07-210001581091us-gaap:RevolvingCreditFacilityMemberrmax:SeniorSecuredCreditFacilityRefinancingMember2023-01-012023-09-300001581091us-gaap:RevolvingCreditFacilityMember2023-09-300001581091rmax:RestrictedStockAndRestrictedStockUnitsRSUsMember2022-07-012022-09-300001581091rmax:RestrictedStockAndRestrictedStockUnitsRSUsMember2022-01-012022-09-300001581091rmax:OnePercentChangeToDiscountRateMember2023-01-012023-09-300001581091rmax:MortgageMember2023-09-300001581091rmax:FranchisingSegmentMember2023-09-300001581091rmax:MortgageMember2022-12-310001581091rmax:FranchisingSegmentMember2022-12-310001581091srt:WeightedAverageMemberus-gaap:TrademarksAndTradeNamesMember2023-09-300001581091srt:WeightedAverageMemberus-gaap:SoftwareAndSoftwareDevelopmentCostsMember2023-09-300001581091srt:WeightedAverageMemberus-gaap:OtherIntangibleAssetsMember2023-09-300001581091srt:WeightedAverageMemberus-gaap:NoncompeteAgreementsMember2023-09-300001581091srt:WeightedAverageMemberrmax:TrainingMember2023-09-300001581091srt:WeightedAverageMemberrmax:ReacquiredFranchiseRightsMember2023-09-300001581091srt:WeightedAverageMemberrmax:OtherBoojMember2023-09-300001581091us-gaap:TrademarksAndTradeNamesMember2023-09-300001581091us-gaap:SoftwareAndSoftwareDevelopmentCostsMember2023-09-300001581091us-gaap:OtherIntangibleAssetsMember2023-09-300001581091us-gaap:NoncompeteAgreementsMember2023-09-300001581091rmax:TrainingMember2023-09-300001581091rmax:ReacquiredFranchiseRightsMember2023-09-300001581091rmax:OtherBoojMember2023-09-300001581091us-gaap:TrademarksAndTradeNamesMember2022-12-310001581091us-gaap:SoftwareAndSoftwareDevelopmentCostsMember2022-12-310001581091us-gaap:OtherIntangibleAssetsMember2022-12-310001581091us-gaap:NoncompeteAgreementsMember2022-12-310001581091rmax:TrainingMember2022-12-310001581091rmax:ReacquiredFranchiseRightsMember2022-12-310001581091rmax:OtherBoojMember2022-12-310001581091rmax:TimeBasedRestrictedStockUnitMember2023-09-300001581091rmax:PerformanceBasedRestrictedStockUnitMember2023-09-300001581091us-gaap:ForeignExchangeForwardMember2023-09-300001581091rmax:TermLoanMemberrmax:SeniorSecuredCreditFacilityRefinancingMember2021-07-212021-07-210001581091rmax:TermLoanMemberrmax:SeniorSecuredCreditFacilityRefinancingMember2023-09-300001581091rmax:TermLoanMemberrmax:SeniorSecuredCreditFacilityRefinancingMember2023-01-012023-09-300001581091rmax:AlternativeBaseRateCreditFacilityLoanMemberrmax:SeniorSecuredCreditFacilityRefinancingMemberus-gaap:EurodollarMember2023-01-012023-09-300001581091srt:MinimumMemberus-gaap:SecuredOvernightFinancingRateSofrOvernightIndexSwapRateMember2023-01-012023-09-300001581091srt:MinimumMemberrmax:LondonInterbankOfferedRateLIBORExtensionMember2023-01-012023-09-300001581091srt:FederalHomeLoanBankOfNewYorkMemberrmax:SeniorSecuredCreditFacilityRefinancingMember2023-01-012023-09-300001581091rmax:SeniorSecuredCreditFacilityRefinancingMemberus-gaap:SecuredOvernightFinancingRateSofrOvernightIndexSwapRateMember2023-01-012023-09-300001581091rmax:SeniorSecuredCreditFacilityRefinancingMemberrmax:LondonInterbankOfferedRateLIBORExtensionMember2023-01-012023-09-300001581091rmax:AlternativeBaseRateCreditFacilityLoanMemberrmax:SeniorSecuredCreditFacilityRefinancingMember2023-01-012023-09-300001581091rmax:OtherRevenueMember2023-09-300001581091rmax:FranchiseSalesMember2023-09-300001581091rmax:AnnualDuesMember2023-09-300001581091rmax:OtherRevenueMember2022-12-310001581091rmax:FranchiseSalesMember2022-12-310001581091rmax:AnnualDuesMember2022-12-310001581091us-gaap:CommonClassBMemberus-gaap:CommonStockMember2023-09-300001581091us-gaap:CommonClassAMemberus-gaap:CommonStockMember2023-09-300001581091us-gaap:CommonClassBMemberus-gaap:CommonStockMember2023-06-300001581091us-gaap:CommonClassAMemberus-gaap:CommonStockMember2023-06-300001581091us-gaap:CommonClassBMemberus-gaap:CommonStockMember2023-03-310001581091us-gaap:CommonClassAMemberus-gaap:CommonStockMember2023-03-310001581091us-gaap:CommonClassBMemberus-gaap:CommonStockMember2022-12-310001581091us-gaap:CommonClassAMemberus-gaap:CommonStockMember2022-12-310001581091us-gaap:CommonClassBMemberus-gaap:CommonStockMember2022-09-300001581091us-gaap:CommonClassAMemberus-gaap:CommonStockMember2022-09-300001581091us-gaap:CommonClassBMemberus-gaap:CommonStockMember2022-06-300001581091us-gaap:CommonClassAMemberus-gaap:CommonStockMember2022-06-300001581091us-gaap:CommonClassBMemberus-gaap:CommonStockMember2022-03-310001581091us-gaap:CommonClassAMemberus-gaap:CommonStockMember2022-03-310001581091us-gaap:CommonClassBMemberus-gaap:CommonStockMember2021-12-310001581091us-gaap:CommonClassAMemberus-gaap:CommonStockMember2021-12-310001581091us-gaap:CommonClassBMember2023-09-300001581091us-gaap:CommonClassAMember2023-09-300001581091us-gaap:CommonClassBMember2022-12-310001581091us-gaap:CommonClassAMember2022-12-310001581091us-gaap:CommonClassAMember2023-07-012023-09-300001581091us-gaap:CommonClassAMember2023-01-012023-09-300001581091us-gaap:CommonClassAMember2022-07-012022-09-300001581091us-gaap:CommonClassAMember2022-01-012022-09-3000015810912022-09-3000015810912021-12-310001581091rmax:FranchiseSalesCommissionMember2023-09-300001581091rmax:FranchiseSalesCommissionMember2022-12-310001581091rmax:MottoMemberus-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2023-09-300001581091rmax:GadberryGroupLlcMemberus-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2023-09-300001581091us-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2023-09-300001581091rmax:MottoMemberus-gaap:FairValueMeasurementsRecurringMember2023-09-300001581091rmax:GadberryGroupLlcMemberus-gaap:FairValueMeasurementsRecurringMember2023-09-300001581091us-gaap:FairValueMeasurementsRecurringMember2023-09-300001581091rmax:MottoMemberus-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2022-12-310001581091rmax:GadberryGroupLlcMemberus-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2022-12-310001581091us-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2022-12-310001581091rmax:MottoMemberus-gaap:FairValueMeasurementsRecurringMember2022-12-310001581091rmax:GadberryGroupLlcMemberus-gaap:FairValueMeasurementsRecurringMember2022-12-310001581091us-gaap:FairValueMeasurementsRecurringMember2022-12-310001581091us-gaap:FairValueInputsLevel3Memberus-gaap:FairValueMeasurementsRecurringMember2023-01-012023-09-300001581091rmax:TimeBasedRestrictedStockUnitMember2023-07-012023-09-300001581091rmax:PerformanceBasedRestrictedStockUnitMember2023-07-012023-09-300001581091rmax:BonusPlanSettledInSharesMember2023-07-012023-09-300001581091rmax:TimeBasedRestrictedStockUnitMember2023-01-012023-09-300001581091rmax:PerformanceBasedRestrictedStockUnitMember2023-01-012023-09-300001581091rmax:BonusPlanSettledInSharesMember2023-01-012023-09-300001581091rmax:TimeBasedRestrictedStockUnitMember2022-07-012022-09-300001581091rmax:PerformanceBasedRestrictedStockUnitMember2022-07-012022-09-300001581091rmax:BonusPlanSettledInSharesMember2022-07-012022-09-300001581091rmax:TimeBasedRestrictedStockUnitMember2022-01-012022-09-300001581091rmax:PerformanceBasedRestrictedStockUnitMember2022-01-012022-09-300001581091rmax:BonusPlanSettledInSharesMember2022-01-012022-09-300001581091rmax:RihiIncMemberrmax:RMCOLlcMembersrt:WeightedAverageMember2023-07-012023-09-300001581091rmax:RihiIncMemberrmax:RMCOLlcMembersrt:WeightedAverageMember2023-01-012023-09-300001581091rmax:RihiIncMemberrmax:RMCOLlcMembersrt:WeightedAverageMember2022-07-012022-09-300001581091rmax:RihiIncMemberrmax:RMCOLlcMembersrt:WeightedAverageMember2022-01-012022-09-300001581091rmax:RMCOLlcMembersrt:WeightedAverageMember2023-07-012023-09-300001581091rmax:RMCOLlcMembersrt:WeightedAverageMember2023-01-012023-09-300001581091rmax:RMCOLlcMembersrt:WeightedAverageMember2022-07-012022-09-300001581091rmax:RMCOLlcMembersrt:WeightedAverageMember2022-01-012022-09-300001581091us-gaap:RetainedEarningsMember2023-07-012023-09-300001581091us-gaap:AdditionalPaidInCapitalMember2023-07-012023-09-300001581091us-gaap:RetainedEarningsMember2023-04-012023-06-300001581091us-gaap:AdditionalPaidInCapitalMember2023-04-012023-06-3000015810912023-04-012023-06-300001581091us-gaap:RetainedEarningsMember2023-01-012023-03-310001581091us-gaap:AdditionalPaidInCapitalMember2023-01-012023-03-3100015810912023-01-012023-03-310001581091us-gaap:RetainedEarningsMember2022-07-012022-09-300001581091us-gaap:AdditionalPaidInCapitalMember2022-07-012022-09-300001581091us-gaap:RetainedEarningsMember2022-04-012022-06-300001581091us-gaap:AdditionalPaidInCapitalMember2022-04-012022-06-300001581091us-gaap:RetainedEarningsMember2022-01-012022-03-310001581091us-gaap:AdditionalPaidInCapitalMember2022-01-012022-03-3100015810912022-01-012022-03-310001581091us-gaap:CommonClassAMemberus-gaap:CommonStockMember2023-07-012023-09-300001581091us-gaap:CommonClassAMemberus-gaap:CommonStockMember2023-04-012023-06-300001581091us-gaap:CommonClassAMemberus-gaap:CommonStockMember2023-01-012023-03-310001581091us-gaap:CommonClassAMemberus-gaap:CommonStockMember2022-07-012022-09-300001581091us-gaap:CommonClassAMemberus-gaap:CommonStockMember2022-04-012022-06-300001581091us-gaap:CommonClassAMemberus-gaap:CommonStockMember2022-01-012022-03-310001581091us-gaap:SoftwareDevelopmentMember2023-09-300001581091us-gaap:SoftwareDevelopmentMember2022-12-310001581091rmax:MottoMemberrmax:RemaxMember2023-01-012023-09-300001581091rmax:RMCOLlcMembersrt:WeightedAverageMember2023-09-300001581091rmax:RMCOLlcMembersrt:WeightedAverageMember2022-09-300001581091rmax:NationwideClaimsMemberrmax:ScenarioTwoMemberus-gaap:SettledLitigationMember2023-09-152023-09-150001581091rmax:NationwideClaimsMemberrmax:ScenarioThreeMemberus-gaap:SettledLitigationMember2023-09-152023-09-1500015810912022-04-012022-06-3000015810912022-06-300001581091rmax:EmployeesAndOwnerMemberrmax:TimeBasedRestrictedStockUnitMember2022-07-012022-09-300001581091rmax:MoehrlRelatedAntitrustLitigationsMember2023-04-220001581091rmax:NationwideClaimsMemberrmax:ScenarioThreeMemberus-gaap:SettledLitigationMember2023-09-150001581091rmax:NationwideClaimsMemberrmax:ScenarioTwoMemberus-gaap:SettledLitigationMember2023-09-150001581091rmax:RMCOLlcMember2023-09-300001581091rmax:RMCOLlcMember2022-12-310001581091rmax:RihiIncMemberrmax:RMCOLlcMember2023-09-300001581091rmax:RihiIncMemberrmax:RMCOLlcMember2022-12-310001581091rmax:WorkInProgressAssetsMemberrmax:MarketingFundsMember2023-07-012023-09-300001581091rmax:TechnologyDevelopmentOperatingMemberrmax:MarketingFundsMember2023-07-012023-09-300001581091rmax:MarketingStaffAndAdministrativeServicesMemberrmax:MarketingFundsMember2023-07-012023-09-300001581091rmax:MarketingFundsMember2023-07-012023-09-300001581091rmax:TechnologyDevelopmentOperatingMemberrmax:MarketingFundsMember2023-01-012023-09-300001581091rmax:TechnologyDevelopmentCapitalMemberrmax:MarketingFundsMember2023-01-012023-09-300001581091rmax:MarketingStaffAndAdministrativeServicesMemberrmax:MarketingFundsMember2023-01-012023-09-300001581091rmax:MarketingFundsMember2023-01-012023-09-300001581091rmax:WorkInProgressAssetsMemberrmax:MarketingFundsMember2023-01-012023-03-310001581091rmax:TechnologyDevelopmentOperatingMemberrmax:MarketingFundsMember2022-07-012022-09-300001581091rmax:TechnologyDevelopmentCapitalMemberrmax:MarketingFundsMember2022-07-012022-09-300001581091rmax:MarketingStaffAndAdministrativeServicesMemberrmax:MarketingFundsMember2022-07-012022-09-300001581091rmax:MarketingFundsMember2022-07-012022-09-300001581091rmax:TechnologyDevelopmentOperatingMemberrmax:MarketingFundsMember2022-01-012022-09-300001581091rmax:TechnologyDevelopmentCapitalMemberrmax:MarketingFundsMember2022-01-012022-09-300001581091rmax:MarketingStaffAndAdministrativeServicesMemberrmax:MarketingFundsMember2022-01-012022-09-300001581091rmax:MarketingFundsMember2022-01-012022-09-300001581091us-gaap:AllOtherSegmentsMember2023-07-012023-09-300001581091rmax:MortgageMember2023-07-012023-09-300001581091rmax:FranchisingSegmentMember2023-07-012023-09-300001581091us-gaap:AllOtherSegmentsMember2023-01-012023-09-300001581091rmax:MortgageMember2023-01-012023-09-300001581091rmax:FranchisingSegmentMember2023-01-012023-09-300001581091us-gaap:AllOtherSegmentsMember2022-07-012022-09-300001581091rmax:MortgageMember2022-07-012022-09-300001581091rmax:FranchisingSegmentMember2022-07-012022-09-3000015810912022-07-012022-09-300001581091us-gaap:AllOtherSegmentsMember2022-01-012022-09-300001581091rmax:MortgageMember2022-01-012022-09-300001581091rmax:FranchisingSegmentMember2022-01-012022-09-3000015810912022-01-012022-09-300001581091rmax:QuarterlyDividendMemberus-gaap:CommonClassAMember2023-07-012023-09-300001581091rmax:QuarterlyDividendMemberus-gaap:CommonClassAMember2023-04-012023-06-300001581091rmax:QuarterlyDividendMemberus-gaap:CommonClassAMember2023-01-012023-09-300001581091rmax:QuarterlyDividendMemberus-gaap:CommonClassAMember2023-01-012023-03-310001581091rmax:QuarterlyDividendMemberus-gaap:CommonClassAMember2022-07-012022-09-300001581091rmax:QuarterlyDividendMemberus-gaap:CommonClassAMember2022-04-012022-06-300001581091rmax:QuarterlyDividendMemberus-gaap:CommonClassAMember2022-01-012022-09-300001581091rmax:QuarterlyDividendMemberus-gaap:CommonClassAMember2022-01-012022-03-310001581091rmax:Above3.50PercentMemberrmax:SeniorSecuredCreditFacilityRefinancingMember2023-09-300001581091rmax:NotExceeding4.50PercentMemberrmax:SeniorSecuredCreditFacilityRefinancingMember2023-01-012023-09-300001581091rmax:LeverageRatioLessThan3.75PercentMemberrmax:SeniorSecuredCreditFacilityRefinancingMember2023-01-012023-09-300001581091rmax:LeverageRatioInExcessOf4.25PercentMemberrmax:SeniorSecuredCreditFacilityRefinancingMember2023-01-012023-09-300001581091rmax:EqualToOrLessThan4.25Memberrmax:SeniorSecuredCreditFacilityRefinancingMember2023-01-012023-09-300001581091rmax:Below3.50PercentMemberrmax:SeniorSecuredCreditFacilityRefinancingMember2023-01-012023-09-300001581091rmax:Above4.50PercentMemberrmax:SeniorSecuredCreditFacilityRefinancingMember2023-01-012023-09-300001581091rmax:Above3.50PercentMemberrmax:SeniorSecuredCreditFacilityRefinancingMember2023-01-012023-09-300001581091rmax:SeniorSecuredCreditFacilityRefinancingMember2023-01-012023-09-300001581091rmax:OtherRevenueMember2023-01-012023-09-300001581091rmax:FranchiseSalesMember2023-01-012023-09-300001581091rmax:AnnualDuesMember2023-01-012023-09-300001581091rmax:FranchiseSalesCommissionMember2023-01-012023-09-300001581091srt:MinimumMember2023-01-012023-09-300001581091srt:MaximumMember2023-01-012023-09-3000015810912023-09-3000015810912022-12-310001581091rmax:NationwideClaimsMemberrmax:ScenarioOneMemberus-gaap:SettledLitigationMember2023-07-012023-09-3000015810912023-07-012023-09-300001581091us-gaap:CommonClassBMember2023-10-270001581091us-gaap:CommonClassAMember2023-10-2700015810912023-01-012023-09-30rmax:segmentxbrli:sharesiso4217:USDrmax:itemxbrli:purermax:leasermax:Drmax:classrmax:employeeiso4217:USDxbrli:shares

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the quarterly period ended September 30, 2023.

OR

Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the transition period from              to             

Commission file number: 001-36101

Graphic

RE/MAX Holdings, Inc.

(Exact name of registrant as specified in its charter)

Delaware

80-0937145

(State or other jurisdiction of
incorporation or organization)

(I.R.S. Employer
Identification Number)

5075 South Syracuse Street
Denver, Colorado

80237

(Address of principal executive offices)

(Zip Code)

(303) 770-5531

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol

Name of each exchange on which registered

Class A Common Stock, $0.0001 par value per share

RMAX

New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes      No     

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes      No  

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer

Accelerated filer

Emerging growth company

Non-accelerated filer

Smaller reporting company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes      No  

On October 27, 2023, there were 18,237,327 outstanding shares of the registrant’s Class A common stock, $0.0001 par value per share, and 1 outstanding share of Class B common stock, $0.0001 par value per share.

TABLE OF CONTENTS

 

 

 

Page No.

 

 

PART I. – FINANCIAL INFORMATION

Item 1.

 

Financial Statements

3

 

 

Condensed Consolidated Balance Sheets

3

 

 

Condensed Consolidated Statements of Income (Loss)

4

Condensed Consolidated Statements of Comprehensive Income (Loss)

5

 

 

Condensed Consolidated Statements of Stockholders’ Equity (Deficit)

6

 

 

Condensed Consolidated Statements of Cash Flows

8

 

 

Notes to Unaudited Condensed Consolidated Financial Statements

9

Item 2.

 

Management’s Discussion and Analysis of Financial Condition and Results of Operations

25

Item 3.

 

Quantitative and Qualitative Disclosures About Market Risks

39

Item 4.

 

Controls and Procedures

40

 

 

PART II. – OTHER INFORMATION

Item 1.

 

Legal Proceedings

41

Item 1A.

 

Risk Factors

41

Item 2.

 

Unregistered Sales of Equity Securities and Use of Proceeds

42

Item 3.

 

Defaults Upon Senior Securities

42

Item 4.

 

Mine Safety Disclosures

42

Item 5.

 

Other Information

42

Item 6.

 

Exhibits

43

SIGNATURES

45

2

PART I. – FINANCIAL INFORMATION

Item 1. Financial Statements

RE/MAX HOLDINGS, INC.

Condensed Consolidated Balance Sheets

(In thousands, except share and per share amounts)

(Unaudited)

September 30, 

December 31, 

2023

2022

Assets

Current assets:

Cash and cash equivalents

$

89,820

$

108,663

Restricted cash

30,993

29,465

Accounts and notes receivable, current portion, net of allowances

33,892

32,518

Income taxes receivable

2,020

2,138

Other current assets

15,828

20,178

Total current assets

172,553

192,962

Property and equipment, net of accumulated depreciation

8,419

9,793

Operating lease right of use assets

24,229

25,825

Franchise agreements, net

105,653

120,174

Other intangible assets, net

20,506

25,763

Goodwill

258,814

258,626

Deferred tax assets, net

51,441

Income taxes receivable, net of current portion

754

754

Other assets, net of current portion

6,943

9,896

Total assets

$

597,871

$

695,234

Liabilities and stockholders' equity (deficit)

Current liabilities:

Accounts payable

$

8,252

$

6,165

Accrued liabilities

104,421

70,751

Income taxes payable

483

1,658

Deferred revenue

24,107

27,784

Current portion of debt

4,600

4,600

Current portion of payable pursuant to tax receivable agreements

1,642

1,642

Operating lease liabilities

7,747

7,068

Total current liabilities

151,252

119,668

Debt, net of current portion

440,913

443,720

Payable pursuant to tax receivable agreements, net of current portion

24,917

Deferred tax liabilities, net

12,386

13,113

Deferred revenue, net of current portion

18,041

18,287

Operating lease liabilities, net of current portion

33,472

37,989

Other liabilities, net of current portion

5,082

5,838

Total liabilities

661,146

663,532

Commitments and contingencies

Stockholders' equity (deficit):

Class A common stock, par value $.0001 per share, 180,000,000 shares authorized; 18,213,497 and 17,874,238 shares issued and outstanding as of September 30, 2023 and December 31, 2022, respectively

2

2

Class B common stock, par value $.0001 per share, 1,000 shares authorized; 1 share issued and outstanding as of September 30, 2023 and December 31, 2022, respectively

Additional paid-in capital

546,184

535,566

Accumulated deficit

(129,248)

(53,999)

Accumulated other comprehensive income (deficit), net of tax

(129)

(395)

Total stockholders' equity attributable to RE/MAX Holdings, Inc.

416,809

481,174

Non-controlling interest

(480,084)

(449,472)

Total stockholders' equity (deficit)

(63,275)

31,702

Total liabilities and stockholders' equity (deficit)

$

597,871

$

695,234

See accompanying notes to unaudited condensed consolidated financial statements.

3

RE/MAX HOLDINGS, INC.

Condensed Consolidated Statements of Income (Loss)

(In thousands, except share and per share amounts)

(Unaudited)

Three Months Ended

Nine Months Ended

September 30, 

September 30, 

2023

2022

2023

2022

Revenue:

Continuing franchise fees

$

31,834

$

33,310

$

96,011

$

100,937

Annual dues

8,456

8,911

25,661

26,847

Broker fees

14,255

16,596

39,468

50,998

Marketing Funds fees

20,853

22,736

63,272

68,496

Franchise sales and other revenue

5,825

7,390

24,659

24,841

Total revenue

81,223

88,943

249,071

272,119

Operating expenses:

Selling, operating and administrative expenses

43,090

49,702

132,417

138,314

Marketing Funds expenses

20,853

22,736

63,272

68,496

Depreciation and amortization

8,195

8,757

24,236

26,855

Settlement and impairment charges

55,000

2,513

55,000

8,708

Gain on reduction in tax receivable agreement liability

(24,917)

(24,917)

Total operating expenses

102,221

83,708

250,008

242,373

Operating income (loss)

(20,998)

5,235

(937)

29,746

Other expenses, net:

Interest expense

(9,292)

(5,729)

(26,377)

(13,412)

Interest income

1,173

497

3,318

675

Foreign currency transaction gains (losses)

125

(360)

383

(340)

Total other expenses, net

(7,994)

(5,592)

(22,676)

(13,077)

Income (loss) before provision for income taxes

(28,992)

(357)

(23,613)

16,669

Provision for income taxes

(53,680)

(553)

(56,494)

(4,359)

Net income (loss)

$

(82,672)

$

(910)

$

(80,107)

$

12,310

Less: net income (loss) attributable to non-controlling interest

(23,218)

(1,050)

(21,992)

4,890

Net income (loss) attributable to RE/MAX Holdings, Inc.

$

(59,454)

$

140

$

(58,115)

$

7,420

Net income (loss) attributable to RE/MAX Holdings, Inc. per share
of Class A common stock

Basic

$

(3.28)

$

0.01

$

(3.22)

$

0.39

Diluted

$

(3.28)

$

0.01

$

(3.22)

$

0.39

Weighted average shares of Class A common stock outstanding

Basic

18,150,557

18,646,306

18,064,009

18,859,376

Diluted

18,150,557

18,876,863

18,064,009

19,080,605

Cash dividends declared per share of Class A common stock

$

0.23

$

0.23

$

0.69

$

0.69

See accompanying notes to unaudited condensed consolidated financial statements.

4

RE/MAX HOLDINGS, INC.

Condensed Consolidated Statements of Comprehensive Income (Loss)

(In thousands)

(Unaudited)

Three Months Ended

Nine Months Ended

September 30, 

September 30, 

2023

2022

2023

2022

Net income (loss)

$

(82,672)

$

(910)

$

(80,107)

$

12,310

Change in cumulative translation adjustment

(1,015)

(2,238)

313

(2,823)

Other comprehensive income (loss), net of tax

(1,015)

(2,238)

313

(2,823)

Comprehensive income (loss)

(83,687)

(3,148)

(79,794)

9,487

Less: Comprehensive income (loss) attributable to non-controlling interest

(23,601)

(2,102)

(21,945)

3,594

Comprehensive income (loss) attributable to RE/MAX Holdings, Inc., net of tax

$

(60,086)

$

(1,046)

$

(57,849)

$

5,893

See accompanying notes to unaudited condensed consolidated financial statements.

5

RE/MAX HOLDINGS, INC.

Condensed Consolidated Statements of Stockholders’ Equity (Deficit)

(In thousands, except share amounts)

(Unaudited)

Retained

Accumulated other

Class A

Class B

Additional

earnings

comprehensive

Non-

Total

common stock

common stock

paid-in

(accumulated

income (loss),

controlling

stockholders'

Shares

    

Amount

    

Shares

    

Amount

    

capital

    

deficit)

    

net of tax

    

interest

    

equity (deficit)

Balances, January 1, 2023

17,874,238

$

2

1

$

$

535,566

$

(53,999)

$

(395)

$

(449,472)

$

31,702

Net income (loss)

(671)

(8)

(679)

Distributions to non-controlling unitholders

(2,889)

(2,889)

Equity-based compensation expense and dividend equivalents

593,463

6,635

(660)

5,975

Dividends to Class A common stockholders

(4,164)

(4,164)

Repurchase and retirement of common shares

(160,405)

(3,408)

(3,408)

Change in accumulated other comprehensive income (loss)

82

17

99

Shares withheld for taxes on share-based compensation

(185,349)

(3,458)

(3,458)

Other

(235)

(235)

Balances, March 31, 2023

18,121,947

$

2

1

$

$

538,743

$

(63,137)

$

(313)

$

(452,352)

$

22,943

Net income (loss)

2,010

1,234

3,244

Distributions to non-controlling unitholders

(2,889)

(2,889)

Equity-based compensation expense and dividend equivalents

5,682

3,688

(3)

3,685

Dividends to Class A common stockholders

(4,168)

(4,168)

Change in accumulated other comprehensive income (loss)

816

413

1,229

Shares withheld for taxes on share-based compensation

(1,013)

(19)

(19)

Balances, June 30, 2023

18,126,616

$

2

1

$

$

542,412

$

(65,298)

$

503

$

(453,594)

$

24,025

Net income (loss)

(59,454)

(23,218)

(82,672)

Distributions to non-controlling unitholders

(2,889)

(2,889)

Equity-based compensation expense and dividend equivalents

121,311

4,309

(327)

3,982

Dividends to Class A common stockholders

(4,170)

(4,170)

Change in accumulated other comprehensive income (loss)

(632)

(383)

(1,015)

Shares withheld for taxes on share-based compensation

(34,430)

(537)

(537)

Other

1

1

Balances, September 30, 2023

18,213,497

$

2

1

$

$

546,184

$

(129,248)

$

(129)

$

(480,084)

$

(63,275)

See accompanying notes to unaudited condensed consolidated financial statements.

6

Retained

Accumulated other

Class A

Class B

Additional

earnings

comprehensive

Non-

Total

common stock

common stock

paid-in

(accumulated

income (loss),

controlling

stockholders'

Shares

    

Amount

    

Shares

    

Amount

    

capital

    

deficit)

    

net of tax

    

interest

    

equity

Balances, January 1, 2022

18,806,194

$

2

1

$

$

515,443

$

(7,821)

$

650

$

(439,207)

$

69,067

Net income (loss)

1,451

1,494

2,945

Distributions to non-controlling unitholders

(2,894)

(2,894)

Equity-based compensation expense and dividend equivalents

587,283

12,215

(685)

11,530

Dividends to Class A common stockholders

(4,439)

(4,439)

Repurchase and retirement of common shares

(45,885)

(1,314)

(1,314)

Change in accumulated other comprehensive income (loss)

242

240

482

Shares withheld for taxes on share-based compensation

(175,048)

(5,586)

(5,586)

Balances, March 31, 2022

19,172,544

$

2

1

$

$

522,072

$

(12,808)

$

892

$

(440,367)

$

69,791

Net income (loss)