Document and Entity Information
Document and Entity Information Document and Entity Information - USD ($) $ in Billions | 12 Months Ended | |
Dec. 31, 2017 | Feb. 23, 2018 | |
Document Information [Line Items] | ||
Document Period End Date | Dec. 31, 2017 | |
Entity Registrant Name | REALOGY HOLDINGS CORP. | |
Entity Central Index Key | 1,398,987 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Document Type | 10-K | |
Document Fiscal Year Focus | 2,017 | |
Document Fiscal Period Focus | FY | |
Amendment Flag | false | |
Entity Common Stock, Shares Outstanding | 130,150,797 | |
Entity Well-known Seasoned Issuer | Yes | |
Entity Voluntary Filers | No | |
Entity Current Reporting Status | Yes | |
Entity Public Float | $ 4.4 | |
Realogy [Member] | ||
Document Information [Line Items] | ||
Entity Registrant Name | REALOGY GROUP LLC | |
Entity Central Index Key | 1,355,001 | |
Entity Filer Category | Non-accelerated Filer | |
Entity Well-known Seasoned Issuer | No | |
Entity Voluntary Filers | Yes | |
Entity Current Reporting Status | No |
Consolidated Statements Of Oper
Consolidated Statements Of Operations - USD ($) shares in Millions, $ in Millions | 12 Months Ended | |||||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | ||||
Revenues | ||||||
Gross commission income | $ 4,576 | $ 4,277 | $ 4,288 | |||
Service revenue | 938 | 955 | 882 | |||
Franchise fees | 396 | 372 | 353 | |||
Other | 204 | 206 | 183 | |||
Net revenues | [1],[2] | 6,114 | 5,810 | 5,706 | ||
Expenses | ||||||
Commission and other agent-related costs | 3,230 | 2,945 | 2,931 | |||
Operating | 1,544 | 1,542 | 1,458 | |||
Marketing | 261 | 241 | 226 | |||
General and administrative | 364 | 321 | 337 | |||
Former parent legacy benefit, net | (10) | (2) | (15) | |||
Restructuring costs, net | 12 | 39 | 10 | |||
Depreciation and amortization | 198 | 202 | [3] | 201 | [3] | |
Interest expense, net | 158 | 174 | 231 | |||
Loss on the early extinguishment of debt | 5 | 0 | 48 | |||
Other expense (income), net | 1 | (1) | (3) | |||
Total expenses | 5,763 | 5,461 | 5,424 | |||
Income before income taxes, equity in earnings and noncontrolling interests | 351 | 349 | 282 | |||
Income tax (benefit) expense | (65) | 144 | 110 | |||
Equity in earnings of unconsolidated entities | (18) | (12) | (16) | |||
Net income | 434 | 217 | 188 | |||
Less: Net income attributable to noncontrolling interests | (3) | (4) | (4) | |||
Net income attributable to Realogy Holdings and Realogy Group | $ 431 | $ 213 | $ 184 | |||
Earnings per share attributable to Realogy Holdings: | ||||||
Basic earnings per share | $ 3.15 | $ 1.47 | $ 1.26 | |||
Diluted earnings per share | $ 3.11 | $ 1.46 | $ 1.24 | |||
Weighted average common and common equivalent shares of Realogy Holdings outstanding: | ||||||
Basic | 136.7 | 144.5 | 146.5 | |||
Diluted | 138.4 | 145.8 | 148.1 | |||
Common Stock, Dividends, Per Share, Cash Paid | $ 0.36 | $ 0.18 | $ 0 | |||
[1] | Revenues for the Relocation Services segment include intercompany referral commissions paid by the Company Owned Real Estate Brokerage Services segment of $40 million, $43 million and $49 million for the years ended December 31, 2017, 2016 and 2015, respectively. Such amounts are recorded as contra-revenues by the Company Owned Real Estate Brokerage Services segment. There are no other material intersegment transactions. | |||||
[2] | Transactions between segments are eliminated in consolidation. Revenues for the Real Estate Franchise Services segment include intercompany royalties and marketing fees paid by the Company Owned Real Estate Brokerage Services segment of $311 million, $293 million and $295 million for the years ended December 31, 2017, 2016 and 2015, respectively. Such amounts are eliminated through the Corporate and Other line. | |||||
[3] | Depreciation and amortization for the year ended December 31, 2017 includes $3 million of amortization expense related to Guaranteed Rate Affinity's purchase accounting included in the "Equity in earnings of unconsolidated entities" line on the Consolidated Statement of Operations. |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Loss - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Net income | $ 434 | $ 217 | $ 188 |
Currency translation adjustment | 3 | (5) | (4) |
Defined Benefit Plans: | |||
Actuarial gain (loss) for the plans | (1) | (3) | 1 |
Less: amortization of actuarial loss to periodic pension cost | (2) | (1) | (2) |
Defined benefit plans | 1 | (2) | 3 |
Other comprehensive income (loss), before tax | 4 | (7) | (1) |
Income tax expense (benefit) related to items of other comprehensive income (loss) amounts | 1 | (3) | 0 |
Other comprehensive income (loss), net of tax | 3 | (4) | (1) |
Comprehensive income | 437 | 213 | 187 |
Less: comprehensive income attributable to noncontrolling interests | (3) | (4) | (4) |
Comprehensive income attributable to Realogy Holdings and Realogy Group | $ 434 | $ 209 | $ 183 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Millions | Dec. 31, 2017 | Dec. 31, 2016 |
Current assets: | ||
Cash and cash equivalents | $ 227 | $ 274 |
Restricted cash | 7 | 7 |
Trade receivables (net of allowance for doubtful accounts of $11 and $13) | 153 | 152 |
Relocation receivables | 223 | 244 |
Other current assets | 179 | 141 |
Total current assets | 789 | 818 |
Property and equipment, net | 289 | 267 |
Goodwill | 3,710 | 3,690 |
Trademarks | 749 | 748 |
Franchise agreements, net | 1,294 | 1,361 |
Other intangibles, net | 284 | 313 |
Other non-current assets | 222 | 224 |
Total assets | 7,337 | 7,421 |
Current liabilities: | ||
Accounts payable | 156 | 140 |
Securitization obligations | 194 | 205 |
Current portion of long-term debt | 127 | 242 |
Accrued expenses and other current liabilities | 478 | 463 |
Total current liabilities | 955 | 1,050 |
Long-term debt | 3,221 | 3,265 |
Deferred income taxes | 327 | 389 |
Other non-current liabilities | 212 | 248 |
Total liabilities | 4,715 | 4,952 |
Commitments and contingencies (Note 13) | ||
Equity: | ||
Realogy Holdings preferred stock: $.01 par value; 50,000,000 shares authorized, none issued and outstanding at December 31, 2017 and December 31, 2016 | 0 | 0 |
Realogy Holdings common stock: $.01 par value; 400,000,000 shares authorized, 131,636,870 shares issued and outstanding at December 31, 2017 and 140,227,692 shares issued and outstanding at December 31, 2016 | 1 | 1 |
Additional paid-in capital | 5,285 | 5,565 |
Accumulated deficit | (2,631) | (3,062) |
Accumulated other comprehensive loss | (37) | (40) |
Total stockholders' equity | 2,618 | 2,464 |
Noncontrolling interests | 4 | 5 |
Total equity | 2,622 | 2,469 |
Total liabilities and equity | $ 7,337 | $ 7,421 |
Consolidated Balance Sheet Pare
Consolidated Balance Sheet Parenthetical - USD ($) $ in Millions | Dec. 31, 2017 | Dec. 31, 2016 |
Allowance for doubtful accounts | $ 11 | $ 13 |
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 400,000,000 | 400,000,000 |
Common stock, shares outstanding | 131,636,870 | 140,227,692 |
Preferred stock, par value | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 50,000,000 | 50,000,000 |
Preferred stock, shares outstanding | 0 | 0 |
Consolidated Statements Of Cash
Consolidated Statements Of Cash Flows - USD ($) $ in Millions | 12 Months Ended | ||||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |||
Operating Activities | |||||
Net income | $ 434 | $ 217 | $ 188 | ||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||
Depreciation and amortization | 198 | 202 | [1] | 201 | [1] |
Deferred income taxes | (63) | 124 | 96 | ||
Amortization of deferred financing costs and discount | 16 | 16 | 18 | ||
Loss on the early extinguishment of debt | 5 | 0 | 48 | ||
Equity in earnings of unconsolidated entities | (18) | (12) | (16) | ||
Stock-based compensation | 52 | 57 | 57 | ||
Mark-to-market adjustments on derivatives | (2) | 4 | 18 | ||
Other adjustments to net income | 1 | (4) | (4) | ||
Net change in assets and liabilities, excluding the impact of acquisitions and dispositions: | |||||
Trade receivables | (1) | (10) | (27) | ||
Relocation receivables | 23 | 31 | 17 | ||
Other assets | (25) | (22) | (25) | ||
Accounts payable, accrued expenses and other liabilities | 9 | (17) | 8 | ||
Dividends received from unconsolidated entities | 52 | 11 | 13 | ||
Other, net | (14) | (11) | (4) | ||
Net cash provided by operating activities | 667 | 586 | 588 | ||
Investing Activities | |||||
Property and equipment additions | (99) | (87) | (84) | ||
Payments for acquisitions, net of cash acquired | (18) | (95) | (127) | ||
Investment in unconsolidated entities | (55) | 0 | 0 | ||
Proceeds from investments in unconsolidated entities | 11 | 0 | 0 | ||
Other, net | 15 | (9) | 0 | ||
Net cash used in investing activities | (146) | (191) | (211) | ||
Financing Activities | |||||
Net change in revolving credit facilities | (130) | 0 | 200 | ||
Repayment of amended Term Loan B Facility | 0 | (758) | 0 | ||
Proceeds from issuance of Term Loan A and A-1 facilities | 0 | 355 | 435 | ||
Amortization payments on term loan facilities | (42) | (41) | (19) | ||
Redemption of First Lien Notes and First and a Half Lien Notes | 0 | 0 | (789) | ||
Proceeds from issuance of Senior Notes | 0 | 750 | 0 | ||
Redemption of Senior Notes | 0 | (500) | 0 | ||
Net change in securitization obligations | (11) | (40) | (21) | ||
Debt issuance costs | (6) | (16) | (10) | ||
Cash paid for fees associated with early extinguishment of debt | (1) | 0 | (39) | ||
Repurchase of common stock | (280) | (195) | 0 | ||
Dividends paid on common stock | (49) | (26) | 0 | ||
Proceeds from exercise of stock options | 8 | 2 | 5 | ||
Taxes paid related to net share settlement for stock-based compensation | (11) | (6) | (6) | ||
Payments of contingent consideration related to acquisitions | (22) | (25) | (7) | ||
Other, net | (26) | (34) | (24) | ||
Net cash used in financing activities | (570) | (534) | (275) | ||
Effect of changes in exchange rates on cash, cash equivalents and restricted cash | 2 | (3) | (2) | ||
Net (decrease) increase in cash, cash equivalents and restricted cash | (47) | (142) | 100 | ||
Cash, cash equivalents and restricted cash, beginning of period | 281 | 423 | 323 | ||
Cash, cash equivalents and restricted cash, end of period | 234 | 281 | 423 | ||
Supplemental Disclosure of Cash Flow Information | |||||
Interest payments (including securitization interest of $7, $6 and $6 respectively) | 172 | 181 | 244 | ||
Income tax payments, net | 12 | 24 | 17 | ||
Securitization Interest | $ 7 | $ 6 | $ 6 | ||
[1] | Depreciation and amortization for the year ended December 31, 2017 includes $3 million of amortization expense related to Guaranteed Rate Affinity's purchase accounting included in the "Equity in earnings of unconsolidated entities" line on the Consolidated Statement of Operations. |
Consolidated Statements Of Equi
Consolidated Statements Of Equity (Deficit) - USD ($) $ in Millions | Total | Common Stock | Additional Paid-In Capital | Accumulated Deficit | Accumulated Other Comprehensive Loss | Non- controlling Interests | |
Balance (in shares) at at Dec. 31, 2014 | 146,400,000 | ||||||
Balance at Dec. 31, 2014 | $ 2,183 | $ 1 | $ 5,677 | $ (3,464) | $ (35) | $ 4 | |
Net income | 188 | 184 | 4 | ||||
Other comprehensive income | (1) | (1) | [1] | ||||
Exercise of stock options (in shares) | 200,000 | ||||||
Exercise of stock options | 5 | 5 | |||||
Stock-based compensation | 57 | 57 | |||||
Issuance of shares for vesting of equity awards | 200,000 | ||||||
Shares withheld for taxes on equity awards (in shares) | (100,000) | ||||||
Shares withheld for taxes on equity awards | (6) | (6) | |||||
Dividends | (4) | ||||||
Dividends | (4) | ||||||
Balance (in shares) at at Dec. 31, 2015 | 146,700,000 | ||||||
Balance at Dec. 31, 2015 | 2,422 | $ 1 | 5,733 | (3,280) | (36) | 4 | |
Net income | 217 | 213 | 4 | ||||
Other comprehensive income | $ (4) | (4) | [1] | ||||
Stock Repurchased and Retired During Period, Shares | (7,100,000) | (6,900,000) | |||||
Stock Repurchased and Retired During Period, Value | $ (195) | (195) | |||||
Exercise of stock options (in shares) | 100,000 | ||||||
Exercise of stock options | 2 | 2 | |||||
Stock-based compensation | 57 | 57 | |||||
Issuance of shares for vesting of equity awards | 500,000 | ||||||
Shares withheld for taxes on equity awards (in shares) | (200,000) | ||||||
Shares withheld for taxes on equity awards | (6) | (6) | |||||
Dividends, Common Stock, Cash | (26) | ||||||
Dividends | (3) | ||||||
Dividends | $ (29) | ||||||
Balance (in shares) at at Dec. 31, 2016 | 140,227,692 | 140,200,000 | |||||
Balance at Dec. 31, 2016 | $ 2,469 | $ 1 | 5,565 | (3,062) | (40) | 5 | |
Cumulative Effect of New Accounting Principle in Period of Adoption | 5 | 5 | |||||
Net income | 434 | 431 | 3 | ||||
Other comprehensive income | $ 3 | 3 | [1] | ||||
Stock Repurchased and Retired During Period, Shares | (9,400,000) | (9,500,000) | |||||
Stock Repurchased and Retired During Period, Value | $ (280) | (280) | |||||
Exercise of stock options (in shares) | 300,000 | ||||||
Exercise of stock options | 8 | 8 | |||||
Stock-based compensation | 52 | 52 | |||||
Issuance of shares for vesting of equity awards | 1,000,000 | ||||||
Shares withheld for taxes on equity awards (in shares) | (400,000) | ||||||
Shares withheld for taxes on equity awards | (11) | (11) | |||||
Dividends, Common Stock, Cash | (49) | ||||||
Dividends | (4) | ||||||
Dividends | $ (53) | ||||||
Balance (in shares) at at Dec. 31, 2017 | 131,636,870 | 131,600,000 | |||||
Balance at Dec. 31, 2017 | $ 2,622 | $ 1 | $ 5,285 | $ (2,631) | $ (37) | $ 4 | |
[1] | As of December 31, 2017, the Company does not have any after-tax components of accumulated other comprehensive loss attributable to noncontrolling interests. |
Note 1. Basis of Presentation B
Note 1. Basis of Presentation Basis of Presentation (Notes) | 12 Months Ended |
Dec. 31, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Business Description and Basis of Presentation [Text Block] | BASIS OF PRESENTATION Realogy Holdings Corp. ("Realogy Holdings", "Realogy" or the "Company") is a holding company for its consolidated subsidiaries including Realogy Intermediate Holdings LLC ("Realogy Intermediate") and Realogy Group LLC ("Realogy Group") and its consolidated subsidiaries. Realogy, through its subsidiaries, is a global provider of residential real estate services. Neither Realogy Holdings, the indirect parent of Realogy Group, nor Realogy Intermediate, the direct parent company of Realogy Group, conducts any operations other than with respect to its respective direct or indirect ownership of Realogy Group. As a result, the consolidated financial positions, results of operations, comprehensive income and cash flows of Realogy Holdings, Realogy Intermediate and Realogy Group are the same. The accompanying Consolidated Financial Statements include the financial statements of Realogy Holdings and Realogy Group. Realogy Holdings' only asset is its investment in the common stock of Realogy Intermediate, and Realogy Intermediate's only asset is its investment in Realogy Group. Realogy Holdings' only obligations are its guarantees of certain borrowings and certain franchise obligations of Realogy Group. All expenses incurred by Realogy Holdings and Realogy Intermediate are for the benefit of Realogy Group and have been reflected in Realogy Group’s consolidated financial statements. The consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America. All intercompany balances and transactions have been eliminated. Business Description The Company reports its operations in the following four business segments: • Real Estate Franchise Services (known as Realogy Franchise Group or RFG)—franchises the Century 21 ® , Coldwell Banker ® , Coldwell Banker Commercial ® , ERA ® , Sotheby's International Realty ® and Better Homes and Gardens ® Real Estate brand names. As of December 31, 2017 , our franchise systems and proprietary brands had approximately 14,800 offices (which included approximately 790 company owned brokerage offices) and approximately 289,000 independent sales agents (which included approximately 50,300 company owned brokerage independent sales agents) operating in the U.S. and 115 other countries and territories around the world. Our wholly-owned subsidiary, ZapLabs LLC , is the developer of our proprietary technology platform for the real estate brokerages and independent sales agents in our franchise system as well as their customers. We believe the Zap technology platform will increase the value proposition to franchisees, independent sales agents and customers as well as improve the productivity of independent sales agents. • Company Owned Real Estate Brokerage Services (known as NRT)—operates a full-service real estate brokerage business with approximately 790 owned and operated brokerage offices with approximately 50,300 independent sales agents principally under the Coldwell Banker ® , Corcoran ® , Sotheby’s International Realty ® , ZipRealty ® and Citi Habitats SM brand names in more than 50 of the 100 largest metropolitan areas in the U.S. This segment also includes the Company's share of earnings for our PHH Home Loans venture, which is in the final stages of winding down as we transition to our new mortgage origination joint venture with Guaranteed Rate Affinity, which will be included in the financial results of the Title and Settlement Services segment . • Relocation Services (known as Cartus ® )—primarily offers clients employee relocation services such as homesale assistance, providing home equity advances to transferees (generally guaranteed by the individual's employer), home finding and other destination services, expense processing, relocation policy counseling and consulting services, arranging household goods moving services, coordinating visa and immigration support, intercultural and language training and group move management services. In addition, we provide home buying and selling assistance to members of affinity clients. • Title and Settlement Services (known as Title Resource Group or TRG)—provides full-service title and settlement services to real estate companies, affinity groups, corporations and financial institutions with many of these services provided in connection with the Company's real estate brokerage and relocation services business. This segment also includes the Company's share of earnings, including start-up costs, for our Guaranteed Rate Affinity joint venture. |
Note 2. Summary of Significant
Note 2. Summary of Significant Accounting Policies Summary of Significant Accounting Policies (Notes) | 12 Months Ended |
Dec. 31, 2017 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies [Text Block] | 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES USE OF ESTIMATES In presenting the consolidated financial statements, management makes estimates and assumptions that affect the amounts reported and related disclosures. Estimates, by their nature, are based on judgment and available information. Accordingly, actual results could differ materially from those estimates. REVENUE RECOGNITION Real Estate Franchise Services The Company franchises its real estate brands to real estate brokerage businesses that are independently owned and operated. Franchise revenue principally consists of royalty and marketing fees from the Company’s franchisees. The royalty received is primarily based on a percentage of the franchisee’s gross commission income. Royalty fees are accrued as the underlying franchisee revenue is earned (upon close of the homesale transaction). Annual volume incentives given to certain franchisees on royalty fees are recorded as a reduction to revenue and are accrued for in relative proportion to the recognition of the underlying gross franchise revenue. Non-standard sales incentives are recorded as a reduction to revenue ratably over the related performance period or from the date of issuance through the remaining life of the related franchise agreement. Franchise revenue also includes initial franchise fees and initial area development fees, which are generally non-refundable and recognized by the Company as revenue when all material services or conditions relating to the sale have been substantially performed. The Company also earns marketing fees from its franchisees and utilizes such fees to fund marketing campaigns on behalf of its franchisees. As such, marketing revenue is earned as these funds are spent. Company Owned Real Estate Brokerage Services As an owner-operator of real estate brokerages, the Company assists home buyers and sellers in listing, marketing, selling and finding homes. Real estate commissions earned by the Company’s real estate brokerage business are recorded as revenue on a gross basis upon the closing of a real estate transaction (i.e., purchase or sale of a home), which are referred to as gross commission income. The commissions the Company pays to real estate agents are recognized concurrently with associated revenues and presented as the commission and other agent-related costs line item on the accompanying Consolidated Statements of Operations. Relocation Services The Company provides relocation services to corporate and government clients for the transfer of their employees ("transferees"). Such services include homesale assistance including the purchasing and/or selling of a transferee’s home and providing home equity advances to transferees (generally guaranteed by the individual's employer), arranging household goods moving services, and other relocation services such as expense processing, relocation policy counseling, relocation-related accounting, coordinating visa and immigration support, intercultural and language training and destination services. Clients may pay a bundled outsourcing management fee that can cover several of the relocation services listed, according the clients’ specific needs. In many cases, Cartus charges an outsourcing fee to the client that covers multiple relocation services that Cartus will deliver to the transferee. The Company earns revenues from fees charged to clients for the performance and/or facilitation of these services and recognizes such revenue as services are provided. In the majority of relocation transactions, the gain or loss on the sale of a transferee’s home is generally borne by the individual's employer. Furthermore, the Company recognizes household goods commission revenue for arranging household goods moving services on a net basis when the household goods reach the destination location. In addition, we provide home buying and selling assistance to members of Affinity organizations. The Company earns referral commission revenue primarily from real estate brokers for the home sale and purchase of transferees and Affinity members, which is recognized at the time the underlying property closes, and revenues from other third-party service providers where the Company earns a referral commission, which is recognized at the time of completion of services. Additionally, the Company generally earns interest income on the funds it advances on behalf of the transferring employee, which is recorded within other revenue (as is the corresponding interest expense on the securitization obligations) in the accompanying Consolidated Statements of Operations. Title and Settlement Services The Company provides title and closing services, which include title search procedures for title insurance policies, homesale escrow and other closing services. Title revenues, which are recorded net of amounts remitted to third-party insurance underwriters, and title and closing service fees are recorded at the time a homesale transaction or refinancing closes. The Company also owns an underwriter of title insurance. For independent title agents, the underwriter recognizes policy premium revenue on a gross basis (before deduction of agent commission) upon notice of policy issuance from the agent. For affiliated title agents, the underwriter recognizes the incremental policy premium revenue upon the effective date of the title policy as the agent commission revenue is already recognized by the affiliated title agent. CONSOLIDATION The Company consolidates any VIE for which it is the primary beneficiary with a controlling financial interest. Also, the Company consolidates an entity not deemed a VIE if its ownership, direct or indirect, exceeds 50% of the outstanding voting shares of an entity and/or it has the ability to control the financial or operating policies through its voting rights, board representation or other similar rights. For entities where the Company does not have a controlling interest (financial or operating), the investments in such entities are accounted for using the equity method or at fair value with changes in fair value recognized in net income, as appropriate. The Company applies the equity method of accounting when it has the ability to exercise significant influence over operating and financial policies of an investee. The Company measures all other investments at fair value with changes in fair value recognized in net income or in the case that an equity investment does not have readily determinable fair values, at cost minus impairment (if any) plus or minus changes resulting from observable price changes in orderly transactions for the identical or a similar investment. CASH AND CASH EQUIVALENTS The Company considers highly liquid investments with remaining maturities not exceeding three months at the date of purchase to be cash equivalents. RESTRICTED CASH Restricted cash primarily relates to amounts specifically designated as collateral for the repayment of outstanding borrowings under the Company’s securitization facilities. Such amounts approximated $7 million at both December 31, 2017 and 2016 . ALLOWANCE FOR DOUBTFUL ACCOUNTS The Company estimates the allowance necessary to provide for uncollectible accounts receivable. The estimate is based on historical experience, combined with a review of current developments and includes specific accounts for which payment has become unlikely. The process by which the Company calculates the allowance begins in the individual business units where specific problem accounts are identified and reserved primarily based upon the age profile of the receivables and specific payment issues. ADVERTISING EXPENSES Advertising costs are generally expensed in the period incurred. Advertising expenses, recorded within the marketing expense line item on the Company’s Consolidated Statements of Operations, were approximately $211 million , $198 million and $194 million for the years ended December 31, 2017 , 2016 and 2015 , respectively. DEBT ISSUANCE COSTS Debt issuance costs include costs incurred in connection with obtaining debt and extending existing debt. These financing costs are presented in the balance sheet as a direct deduction from the carrying value of the associated debt liability, consistent with the presentation of a debt discount, with the exception of the debt issuance costs related to the Revolving Credit Facility and securitization obligations which are classified as a deferred financing asset within other assets. The debt issuance costs are amortized via the effective interest method and the amortization period is the life of the related debt. INCOME TAXES The Company’s provision for income taxes is determined using the asset and liability method, under which deferred tax assets and liabilities are calculated based upon the temporary differences between the financial statement and income tax bases of assets and liabilities using currently enacted tax rates. These differences are based upon estimated differences between the book and tax basis of the assets and liabilities for the Company. Certain tax assets and liabilities of the Company may be adjusted in connection with the finalization of income tax audits. The Company’s deferred tax assets are recorded net of a valuation allowance when, based on the weight of available evidence, it is more likely than not that all or some portion of the recorded deferred tax balances will not be realized in future periods. Decreases to the valuation allowance are recorded as reductions to the Company’s provision for income taxes and increases to the valuation allowance result in additional provision for income taxes. DERIVATIVE INSTRUMENTS The Company records derivatives and hedging activities on the balance sheet at their respective fair values. The Company uses foreign currency forward contracts largely to manage its exposure to changes in foreign currency exchange rates associated with its foreign currency denominated receivables and payables. The Company primarily manages its foreign currency exposure to the Euro, British Pound, Swiss Franc and Canadian Dollar. The Company has not elected to utilize hedge accounting for these forward contracts; therefore, any change in fair value is recorded in the Consolidated Statements of Operations. However, the fluctuations in the value of these forward contracts generally offset the impact of changes in the value of the underlying risk that they are intended to economically hedge. The Company also enters into interest rate swaps to manage its exposure to changes in interest rates associated with its variable rate borrowings. At December 31, 2017 , the Company has interest rate swaps with an aggregate notional value of $1,475 million to offset the variability in cash flows resulting from the term loan facilities as follows: Notional Value (in millions) Commencement Date Expiration Date $225 July 2012 February 2018 (a) $200 January 2013 February 2018 (a) $600 August 2015 August 2020 $450 November 2017 (a) November 2022 _______________ (a) Interest rates swaps with a notional value of $425 million expired February 10, 2018, and interest rate swaps with a notional value of $450 million commenced in the fourth quarter of 2017. The swaps help to protect our outstanding variable rate borrowings from future interest rate volatility. The Company has not elected to utilize hedge accounting for these interest rate swaps; therefore, any change in fair value is recorded in the Consolidated Statements of Operations. INVESTMENTS The Company owned 49.9% of PHH Home Loans, a mortgage origination venture formed in 2005 for the purpose of originating and selling mortgage loans primarily sourced through the Company’s real estate brokerage and relocation businesses, while PHH Corporation ("PHH") owned the remaining percentage. In February 2017, Realogy announced that it and Guaranteed Rate, Inc. (“Guaranteed Rate”) agreed to form a new mortgage origination joint venture, Guaranteed Rate Affinity, LLC ("Guaranteed Rate Affinity"). During the third and fourth quarters of 2017, Guaranteed Rate Affinity, acquired certain assets of the mortgage operations of PHH Home Loans, including its four regional centers and employees across the United States, but not its mortgage assets. Guaranteed Rate Affinity began doing business in August 2017 on a phased-in basis. Guaranteed Rate Affinity originates and markets its mortgage lending services to the Company's real estate brokerage and relocation subsidiaries as well as other real estate brokerage companies across the country. Guaranteed Rate owns a controlling 50.1% stake of Guaranteed Rate Affinity and the Company owns 49.9% . The Company has certain governance rights related to the joint venture, however it does not have control of the day-to-day operations of Guaranteed Rate Affinity. While the equity earnings or losses related to PHH Home Loans were included in the financial results of the Company Owned Real Estate Brokerage Services segment, the equity earnings or losses related to Guaranteed Rate Affinity are included in the financial results of the Title and Settlement Services segment. At December 31, 2017 and 2016 , the Company had various equity method investments aggregating $74 million and $66 million , respectively, which are recorded within other current and non-current assets on the accompanying Consolidated Balance Sheets. The $74 million investment balance at December 31, 2017 included $48 million for the Company's investment in Guaranteed Rate Affinity and $19 million for the Company's investment in PHH Home Loans, which has ceased operations. The Company's remaining interest in PHH Home Loans is expected to be liquidated in the first half of 2018 and the Company expects to realize net cash proceeds of $19 million , reducing the investment balance to zero. The $66 million investment balance at December 31, 2016 included $59 million for the Company's investment in PHH Home Loans. For the year ended December 31, 2017 , the Company recorded equity earnings of $18 million which consisted of $35 million of earnings from the sale of PHH Home Loans' assets to Guaranteed Rate Affinity, partially offset by $7 million of exit costs and losses of $6 million from the continuing operations of PHH Home Loans. In addition, there was a $4 million loss from equity method investments at the Title and Settlement Services segment primarily related to costs associated with the start up of operations of Guaranteed Rate Affinity, including $3 million of amortization of intangible assets recorded in purchase accounting. For the years ended December 31, 2016 and 2015, the Company recorded equity earnings of $12 million and $16 million , respectively, which consisted of $8 million and $14 million , respectively, relating to its investment in PHH Home Loans. The Company received $60 million , $7 million and $10 million in cash dividends, primarily from PHH Home Loans, during the years ended December 31, 2017 , 2016 and 2015 , respectively. The Company invested $55 million of cash into Guaranteed Rate Affinity during the year ended December 31, 2017 . PROPERTY AND EQUIPMENT Property and equipment (including leasehold improvements) are initially recorded at cost, net of accumulated depreciation and amortization. Depreciation, recorded as a component of depreciation and amortization on the Consolidated Statements of Operations, is computed utilizing the straight-line method over the estimated useful lives of the related assets. Amortization of leasehold improvements, also recorded as a component of depreciation and amortization, is computed utilizing the straight-line method over the estimated benefit period of the related assets or the lease term, if shorter. Useful lives are 30 years for buildings, up to 20 years for leasehold improvements, and from 3 to 7 years for furniture, fixtures and equipment. The Company capitalizes the costs of software developed for internal use which commences during the development phase of the project. The Company amortizes software developed or obtained for internal use on a straight-line basis, generally from 1 to 5 years, when such software is ready for use. The net carrying value of software developed or obtained for internal use was $86 million and $83 million at December 31, 2017 and 2016 , respectively. IMPAIRMENT OF GOODWILL, INTANGIBLE ASSETS AND OTHER LONG-LIVED ASSETS Goodwill represents the excess of acquisition costs over the fair value of the net tangible assets and identifiable intangible assets acquired in a business combination. Indefinite-lived intangible assets primarily consist of trademarks acquired in business combinations. Goodwill and indefinite-lived assets are not amortized, but are subject to impairment testing. The aggregate carrying values of our goodwill and other indefinite-lived intangible assets were $3,710 million and $767 million , respectively, at December 31, 2017 and are subject to impairment testing annually as of October 1, or whenever events or changes in circumstances indicate that the carrying amount may not be fully recoverable. This testing compares carrying values to fair values and, when appropriate, the carrying value is reduced to fair value. In testing goodwill, the fair value of our reporting units is estimated utilizing a discounted cash flow approach utilizing long-term cash flow forecasts and our annual operating plans adjusted for terminal value assumptions. We determine the fair value of our reporting units utilizing our best estimate of future revenues, operating expenses, cash flows, market and general economic conditions as well as assumptions that we believe marketplace participants would utilize including discount rates, cost of capital, trademark royalty rates and long-term growth rates. The trademark royalty rate was determined by reviewing similar trademark agreements with third parties. Although we believe our assumptions are reasonable, actual results may vary significantly. These impairment tests involve the use of accounting estimates and assumptions, changes in which could materially impact our financial condition or operating performance if actual results differ from such estimates and assumptions. To address this uncertainty, we perform sensitivity analysis on key estimates and assumptions. Based upon the impairment analysis performed in the fourth quarter of 2017 , 2016 and 2015 , there was no impairment of goodwill or other indefinite-lived intangible assets for these years. Management evaluated the effect of lowering the estimated fair value for each of the reporting units by 10% and determined that no impairment of goodwill would have been recognized under this evaluation for 2017 , 2016 or 2015 . The Company evaluates the recoverability of its other long-lived assets, including amortizable intangible assets, if circumstances indicate an impairment may have occurred. This analysis is performed by comparing the respective carrying values of the assets to the current and expected future cash flows, on an undiscounted basis, to be generated from such assets. Property and equipment is evaluated separately within each business unit. If such analysis indicates that the carrying value of these assets is not recoverable, then the carrying value of such assets is reduced to fair value through a charge to the Company’s Consolidated Statements of Operations. There were no impairments relating to other long-lived assets, including amortizable intangible assets, during 2017 , 2016 or 2015 . SUPPLEMENTAL CASH FLOW INFORMATION Significant non-cash transactions in 2017 , 2016 and 2015 included $18 million , $14 million and $17 million , respectively, in capital lease additions, which resulted in non-cash additions to property and equipment, net and other non-current liabilities. STOCK-BASED COMPENSATION The Company grants stock-based awards to certain senior management, employees and directors including non-qualified stock options, restricted stock, restricted stock units and performance share units . The fair value of non-qualified stock options is estimated using the Black-Scholes option pricing model on the grant date and is recognized as expense over the service period based on the vesting requirements. The fair value of r estricted stock, restricted stock units and performance share units without a market condition is measured based on the closing price of the Company's common stock on the grant date and is recognized as expense over the service period of the award, or when requisite performance metrics or milestones are probable of being achieved . The fair value of awards with a market condition are estimated using the Monte Carlo simulation method and expense is recognized on a straight-line basis over the requisite service period of the award. The Company recognizes forfeitures as they occur. Determining the fair value of stock-based awards at the grant date requires considerable judgment, including estimating expected volatility and expected term, risk-free rate. RECENTLY ADOPTED ACCOUNTING PRONOUNCEMENTS In August 2016, the FASB issued a new standard on classification of cash receipts and payments on the statement of cash flows intending to reduce diversity in practice on how certain transactions are classified. In addition, in November 2016, the FASB issued a new standard requiring that the statement of cash flows explain the change during the period in the total of cash, cash equivalents, and amounts generally described as restricted cash or restricted cash equivalents. The Company elected to early adopt these ASUs in the fourth quarter of 2017 using retrospective application at the beginning of the earliest comparative period presented in the year of adoption, January 1, 2015. Adoption of the new guidance resulted in the following key changes: • Contingent consideration for business acquisitions - Prior to adoption of the new guidance, the Company classified payments of contingent consideration for business acquisitions on a separate line in the financing section of its Consolidated Statement of Cash Flows. Under the new guidance, payments of contingent consideration are separated and classified as investing activities for payments made soon after the acquisition’s consummation date (three months or less), financing activities for payments made up to the original acquisition date amount of the contingent consideration liability and operating activities for payments made in excess of the original amount of the contingent consideration liability. • Debt prepayments or extinguishment - Prior to adoption of the new guidance, the Company classified cash paid for fees associated with the prepayment or extinguishment of debt in the operating section of its Consolidated Statement of Cash Flows as part of net income (loss), adding back only the non-cash portion as an adjustment to reconcile net income (loss) to net cash provided (used) by operating activities. Under the new guidance, all cash paid for fees associated with the prepayment or extinguishment of debt is classified as financing activities and the total of the cash and non-cash portions are added back in the operating section. • Restricted Cash - Prior to adoption of the new guidance, the Company presented the change in restricted cash as a separate line in the investing section of its Consolidated Statement of Cash Flows. Under the new guidance, restricted cash is presented with cash and cash equivalents on the Consolidated Statement of Cash Flows and the activity is now reflected in the total change in cash, cash equivalents and restricted cash. Additionally, for reconciliation purposes, the Company broke out restricted cash as a separate line on the Company’s Consolidated Balance Sheet. Adoption of the new guidance resulted in reclassifications between cash flow categories, but no net cash impact to its Consolidated Statement of Cash Flows. RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS The Company considers the applicability and impact of all Accounting Standards Updates. ASUs not listed below were assessed and determined to be either not applicable or are expected to have minimal impact on our consolidated financial position or results of operations. In February 2018, the FASB issued a new standard which permits companies to reclassify certain income tax effects resulting from the 2017 Tax Act, called "stranded tax effects", from accumulated other comprehensive income ("AOCI") to retained earnings. According to the new guidance, the reclassification amount should include the effect of the change in the U.S. federal corporate income tax rate on the gross deferred tax amounts and related valuation allowances, if any, at the date of enactment of the 2017 Tax Act related to items remaining in AOCI. The guidance is effective for all companies for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years. Early adoption is permitted, including adoption in any interim period for public companies who have not yet issued financial statements. The Company expects to adopt this standard in the first quarter of 2018 which is expected to result in a debit to AOCI and a credit to Retained Earnings/Accumulated Deficit of approximately $9 million . In February 2016, the FASB issued its new standard on leases which requires virtually all leases to be recognized on the balance sheet. Lessees will recognize a right-of-use asset and a lease liability for all leases (other than leases that meet the definition of a short-term lease). The liability will be equal to the present value of lease payments. The asset will be based on the liability, subject to adjustment, such as for initial direct costs. For income statement purposes, the FASB retained a dual model, requiring leases to be classified as either operating or finance leases. Operating leases will result in straight-line expense, similar to current operating leases, while finance leases will result in a front-loaded expense pattern, similar to current capital leases. Classification will be based on criteria that are largely similar to those applied in current lease accounting, but without explicit bright lines. The new standard is effective for annual periods beginning after December 15, 2018. Early adoption is permitted. The new leasing standard requires modified retrospective transition, which requires application of the new guidance at the beginning of the earliest comparative period presented in the year of adoption. In January 2018, the FASB issued a proposed ASU that would allow entities to elect a simplified transition approach which would require applying the provisions of the new guidance at the effective date (e.g., January 1, 2019) as opposed to the earliest period presented under the modified retrospective approach (January 1, 2017). While the Company is still evaluating the impact of the standard on its consolidated financial statements, it does expect that the right to use asset and lease liability recorded on its Consolidated Balance Sheets will be material. The Company currently discloses its future lease obligations in Note 13. "Commitments and Contingencies" . The Company is in the process of implementing a new lease management system which will be utilized to account for leases under the new guidance once adopted. In May 2014, the FASB issued a standard on revenue recognition that will impact most companies to some extent. The objective of the revenue standard is to provide a single, comprehensive revenue recognition model for all contracts with customers to improve comparability within industries, across industries, and across capital markets. The revenue standard contains principles that an entity will apply to determine the measurement of revenue and the timing of revenue recognition. The new standard permits for two alternative implementation methods, the use of either (1) full retrospective application to each prior reporting period presented or (2) modified retrospective application in which the cumulative effect of initially applying the revenue standard is recognized as an adjustment to the opening balance of retained earnings in the period of adoption. The Company will adopt the new standard in the first quarter of 2018 using the modified retrospective transition method. The Company has redrafted its revenue recognition accounting policies affected by the standard, assessed the redesign of internal controls, as well as evaluated the expanded disclosure requirements. After thorough review of the Company's revenue streams, the Company determined that the new standard will not have a material impact on financial results as the majority of the Company's revenue is recognized at a point in time, at the completion of a homesale transaction, which will not change under the new revenue recognition guidance. |
Note 3. Acquisitions Acquisitio
Note 3. Acquisitions Acquisitions (Notes) | 12 Months Ended |
Dec. 31, 2017 | |
Business Combinations [Abstract] | |
Business Combination Disclosure [Text Block] | ACQUISITIONS Assets acquired and liabilities assumed in business combinations were recorded in the Company’s Consolidated Balance Sheets as of the respective acquisition dates based upon their estimated fair values at such dates. The results of operations of businesses acquired by the Company have been included in the Company’s Consolidated Statements of Operations since their respective dates of acquisition. In connection with the Company’s acquisition of real estate brokerage operations, the Company obtains contractual pendings and listings intangible assets, which represent the estimated fair value of homesale transactions that are pending closing or homes listed for sale by the acquired brokerage operations. Pendings and listings intangible assets are amortized over the estimated closing period of the underlying contracts and homes listed for sale, which in most cases is approximately five months . 2017 Acquisitions During the year ended December 31, 2017 , the Company acquired sixteen real estate brokerage operations through its wholly owned subsidiary, NRT, for aggregate cash consideration of $11 million and established $3 million of contingent consideration. These acquisitions resulted in goodwill of $10 million , pendings and listings of $2 million , customer relationships of $1 million and other intangibles of $1 million . During the year ended December 31, 2017 , the Company acquired two title and settlement operations through its wholly owned subsidiary, TRG, for cash consideration of $8 million and established $4 million of contingent consideration. These acquisitions resulted in goodwill of $9 million , pendings of $2 million and other intangible items of $1 million including tradenames. None of the 2017 acquisitions were significant to the Company’s results of operations, financial position or cash flows individually or in the aggregate. 2016 Acquisitions During the year ended December 31, 2016, the Company acquired eleven real estate brokerage and property management operations through its wholly owned subsidiary, NRT, for aggregate cash consideration of $74 million and established $9 million of contingent consideration. These acquisitions resulted in goodwill of $52 million , customer relationships of $20 million , pendings and listings of $6 million , other intangibles of $3 million , other assets of $5 million and other liabilities of $3 million . During the year ended December 31, 2016, the Company acquired one title and settlement operation through its wholly owned subsidiary, TRG, for cash consideration of $24 million and established $10 million of contingent consideration. This acquisition resulted in goodwill of $20 million , title plant of $7 million , pendings of $5 million , trademarks of $3 million , other intangibles of $2 million , other assets of $6 million and other liabilities of $9 million . None of the 2016 acquisitions were significant to the Company’s results of operations, financial position or cash flows individually or in the aggregate. 2015 Acquisitions During the year ended December 31, 2015, the Company acquired thirteen real estate brokerage related operations through its wholly owned subsidiary, NRT, including a large franchisee of the Real Estate Franchise segment, for aggregate cash consideration of $96 million and established $13 million of liabilities related to contingent consideration and other acquisition related liabilities. These acquisitions resulted in goodwill of $94 million , pendings and listings of $10 million , other intangibles of $1 million , other assets of $7 million and other liabilities of $3 million . During the year ended December 31, 2015, the Company acquired three title and settlement operations through its wholly owned subsidiary, TRG, for cash consideration of $34 million and established $37 million of liabilities related to contingent consideration. These acquisitions resulted in goodwill of $47 million , trademarks of $9 million , pendings of $8 million , other intangibles of $5 million , title plant shares of $1 million and other assets of $1 million . None of the 2015 acquisitions were significant to the Company’s results of operations, financial position or cash flows individually or in the aggregate. |
Note 4. Intangible Assets Intan
Note 4. Intangible Assets Intangible Assets (Notes) | 12 Months Ended |
Dec. 31, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets Disclosure | INTANGIBLE ASSETS Goodwill by segment and changes in the carrying amount are as follows: Real Estate Franchise Services Company Owned Brokerage Services Relocation Services Title and Settlement Services Total Company Balance at January 1, 2015 $ 2,292 $ 747 $ 360 $ 78 $ 3,477 Goodwill acquired — 94 — 47 141 Balance at December 31, 2015 2,292 841 360 125 3,618 Goodwill acquired — 52 — 20 72 Balance at December 31, 2016 2,292 893 360 145 3,690 Goodwill acquired — 11 — 9 20 Balance at December 31, 2017 $ 2,292 $ 904 $ 360 $ 154 $ 3,710 Goodwill and accumulated impairment summary Gross goodwill $ 3,315 $ 1,062 $ 641 $ 478 $ 5,496 Accumulated impairment losses (a) (1,023 ) (158 ) (281 ) (324 ) (1,786 ) Balance at December 31, 2017 $ 2,292 $ 904 $ 360 $ 154 $ 3,710 _______________ (a) During the fourth quarter of 2008 and 2007 the Company recorded impairment charges, which reduced goodwill by $1,279 million and $507 million , respectively. No goodwill or unamortized intangible asset impairments have been recorded since 2008. Intangible assets are as follows: As of December 31, 2017 As of December 31, 2016 Gross Carrying Amount Accumulated Amortization Net Carrying Amount Gross Carrying Amount Accumulated Amortization Net Carrying Amount Amortizable—Franchise agreements (a) $ 2,019 $ 725 $ 1,294 $ 2,019 $ 658 $ 1,361 Indefinite life—Trademarks (b) $ 749 $ 749 $ 748 $ 748 Other Intangibles Amortizable—License agreements (c) $ 45 $ 10 $ 35 $ 45 $ 9 $ 36 Amortizable—Customer relationships (d) 549 335 214 550 312 238 Indefinite life—Title plant shares (e) 18 18 18 18 Amortizable—Pendings and listings (f) 2 1 1 6 5 1 Amortizable—Other (g) 33 17 16 33 13 20 Total Other Intangibles $ 647 $ 363 $ 284 $ 652 $ 339 $ 313 _______________ (a) Generally amortized over a period of 30 years. (b) Primarily relates to the Century 21 ® , Coldwell Banker ® , ERA ® , Corcoran ® , Coldwell Banker Commercial ® and Cartus tradenames, which are expected to generate future cash flows for an indefinite period of time. (c) Relates to the Sotheby’s International Realty ® and Better Homes and Gardens ® Real Estate agreements which are being amortized over 50 years (the contractual term of the license agreements). (d) Relates to the customer relationships at the Relocation Services segment, the Title and Settlement Services segment, the Real Estate Franchise Services segment and our Company Owned Real Estate Brokerage Services segment. These relationships are being amortized over a period of 2 to 20 years. (e) Ownership in a title plant is required to transact title insurance in certain states. The Company expects to generate future cash flows for an indefinite period of time. (f) Generally amortized over a period of 5 months . (g) Consists of covenants not to compete which are amortized over their contract lives and other intangibles which are generally amortized over periods ranging from 5 to 10 years. Intangible asset amortization expense is as follows: For the Year Ended December 31, 2017 2016 2015 Franchise agreements $ 67 $ 67 $ 67 License agreements 1 1 1 Customer relationships 25 28 28 Pendings and listings 4 12 16 Other 5 5 5 Total $ 102 $ 113 $ 117 Based on the Company’s amortizable intangible assets as of December 31, 2017 , the Company expects related amortization expense to be approximately $98 million , $97 million , $95 million , $93 million , $92 million and $1,085 million in 2018 , 2019 , 2020 , 2021 , 2022 and thereafter, respectively. |
Note 5. Franchising and Marketi
Note 5. Franchising and Marketing Activities Franchising and Marketing Activities (Notes) | 12 Months Ended |
Dec. 31, 2017 | |
Franchising and Marketing Activities [Abstract] | |
Franchisors [Text Block] | FRANCHISING AND MARKETING ACTIVITIES Franchise fee revenue includes domestic initial franchise fees and international area development fees of $8 million for each of the years ended December 31, 2017 , 2016 and 2015 . In addition, franchise fee revenue is net of annual volume incentives provided to real estate franchisees of $62 million , $56 million and $51 million for the years ended December 31, 2017 , 2016 and 2015 , respectively. The Company’s real estate franchisees may receive volume incentives on their royalty payments. Such annual incentives are based upon the amount of the franchisees commission income earned and paid to the Company during the calendar year. Each brand has several different annual incentive schedules currently in effect. The Company’s wholly owned real estate brokerage services segment, NRT, pays royalties to the Company’s franchise business; however, such amounts are eliminated in consolidation. NRT paid royalties to the Real Estate Franchise Services segment of $299 million , $282 million and $284 million for the years ended December 31, 2017 , 2016 and 2015 , respectively. Marketing fees are generally paid by the Company’s real estate franchisees and are generally calculated based on a specified percentage of gross closed commissions earned on real estate transactions, and may be subject to certain minimum and maximum payments. Brand marketing fund revenue was $87 million , $83 million and $83 million for the years ended December 31, 2017 , 2016 and 2015 , respectively, which included marketing fees paid to the Real Estate Franchise Services segment from NRT of $12 million , $11 million and $11 million for the years ended December 31, 2017 , 2016 and 2015 , respectively. As provided for in the franchise agreements and generally at the Company’s discretion, all of these fees are to be expended for marketing purposes. The number of franchised and company owned offices in operation are as follows: (Unaudited) As of December 31, 2017 2016 2015 Franchised: Century 21 ® 7,973 7,330 6,897 ERA ® 2,298 2,347 2,355 Coldwell Banker ® 2,330 2,289 2,258 Coldwell Banker Commercial ® 180 180 163 Sotheby’s International Realty ® 905 836 794 Better Homes and Gardens ® Real Estate 353 332 304 Total Franchised 14,039 13,314 12,771 Company Owned: Coldwell Banker ® 707 708 708 Sotheby’s International Realty ® 41 41 41 Corcoran ® /Other 41 40 38 Total Company Owned 789 789 787 The number of franchised and company owned offices (in the aggregate) changed as follows: (Unaudited) For the Year Ended December 31, 2017 2016 2015 Franchised: Beginning balance 13,314 12,771 12,769 Additions 1,137 847 445 Terminations (412 ) (304 ) (443 ) Ending balance 14,039 13,314 12,771 Company Owned: Beginning balance 789 787 727 Additions 20 38 74 Closures (20 ) (36 ) (14 ) Ending balance 789 789 787 As of December 31, 2017 , there were an insignificant number of franchise agreements that were executed for which offices are not yet operating. Additionally, as of December 31, 2017 , there were an insignificant number of franchise agreements pending termination. In order to assist franchisees in converting to one of the Company’s brands or as an incentive to renew their franchise agreement, the Company may at its discretion, provide non-standard incentives, primarily in the form of conversion notes. Provided the franchisee meets certain minimum annual revenue thresholds during the term of the notes and is in compliance with the terms of the franchise agreement, the amount of the note is forgiven annually in equal ratable amounts over the life of the franchise agreement. Otherwise, related principal is due and payable to the Company. The amount of such franchisee conversion notes were $124 million , net of less than $1 million of reserves, and $123 million , net of less than $1 million of reserves, at December 31, 2017 and 2016 , respectively. These notes are principally classified within other non-current assets in the Company’s Consolidated Balance Sheets. The Company recorded a contra-revenue in the statement of operations related to the forgiveness and impairment of these notes and other sales incentives of $25 million , $24 million and $22 million for the years ended December 31, 2017 , 2016 and 2015 , respectively. |
Note 6. Property and Equipment,
Note 6. Property and Equipment, Net Property and Equipment, Net (Notes) | 12 Months Ended |
Dec. 31, 2017 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment, Net | 6. PROPERTY AND EQUIPMENT, NET Property and equipment, net consisted of: December 31, 2017 2016 Furniture, fixtures and equipment $ 281 $ 254 Capitalized software 366 351 Building and leasehold improvements 265 235 Land 3 3 Gross property and equipment 915 843 Less: accumulated depreciation (626 ) (576 ) Property and equipment, net $ 289 $ 267 The Company recorded depreciation expense related to property and equipment of $96 million , $89 million and $84 million for the years ended December 31, 2017 , 2016 and 2015 , respectively. |
Note 7. Accrued Expenses And Ot
Note 7. Accrued Expenses And Other Current Liabilities Accrued Expenses And Other Current Liabilities (Notes) | 12 Months Ended |
Dec. 31, 2017 | |
Payables and Accruals [Abstract] | |
Accrued Expenses And Other Current Liabilities | 7. ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES Accrued expenses and other current liabilities consisted of: December 31, 2017 2016 Accrued payroll and related employee costs $ 140 $ 138 Accrued volume incentives 41 40 Accrued commissions 38 31 Restructuring accruals 5 14 Deferred income 68 69 Accrued interest 13 13 Contingent consideration for acquisitions 26 24 Due to former parent 18 28 Other 129 106 Total accrued expenses and other current liabilities $ 478 $ 463 |
Note 8. Short And Long-Term Deb
Note 8. Short And Long-Term Debt Short and Long-Term Debt (Notes) | 12 Months Ended |
Dec. 31, 2017 | |
Debt Disclosure [Abstract] | |
Short And Long-Term Debt | SHORT AND LONG-TERM DEBT Total indebtedness is as follows: December 31, 2017 2016 Senior Secured Credit Facility: Revolving Credit Facility $ 70 $ 200 Term Loan B 1,063 1,069 Term Loan A Facility: Term Loan A 390 411 Term Loan A-1 339 347 4.50% Senior Notes 444 439 5.25% Senior Notes 546 545 4.875% Senior Notes 496 496 Total Short-Term & Long-Term Debt $ 3,348 $ 3,507 Securitization obligations: Apple Ridge Funding LLC $ 181 $ 192 Cartus Financing Limited 13 13 Total securitization obligations $ 194 $ 205 Indebtedness Table As of December 31, 2017 , the Company’s borrowing arrangements were as follows: Interest Rate Expiration Date Principal Amount Unamortized Discount and Debt Issuance Costs Net Amount Senior Secured Credit Facility: Revolving Credit Facility (1) (2) October 2020 $ 70 $ * $ 70 Term Loan B (3) July 2022 1,083 20 1,063 Term Loan A Facility: Term Loan A (4) October 2020 391 1 390 Term Loan A-1 (5) July 2021 342 3 339 Senior Notes 4.50% April 2019 450 6 444 Senior Notes 5.25% December 2021 550 4 546 Senior Notes 4.875% June 2023 500 4 496 Securitization obligations: (6) Apple Ridge Funding LLC (7) June 2018 181 * 181 Cartus Financing Limited (8) August 2018 13 * 13 Total (9) $ 3,580 $ 38 $ 3,542 _______________ * The debt issuance costs related to our Revolving Credit Facility and securitization obligations are classified as a deferred financing asset within other assets. (1) As of December 31, 2017 , the Company had $1,050 million of borrowing capacity under its Revolving Credit Facility, leaving $980 million of available capacity. The Revolving Credit Facility expires in October 2020, but is classified on the balance sheet as current due to the revolving nature of the facility. On February 23, 2018 , the Company had $242 million in outstanding borrowings under the New Revolving Credit Facility, leaving $1,158 million of available capacity. See Note 19, "Subsequent Events" for a description of the February 2018 refinancing. (2) Interest rates with respect to revolving loans under the Senior Secured Credit Facility at December 31, 2017 were based on, at the Company's option, (a) adjusted LIBOR plus an additional margin or (b) ABR plus an additional margin, in each case subject to adjustment based on the then current senior secured leverage ratio. Based on the previous quarter senior secured leverage ratio, the LIBOR margin was 2.00% and the ABR margin was 1.00% for the three months ended December 31, 2017 . (3) The Term Loan B provided for quarterly amortization payments totaling 1% per annum of the original principal amount. The interest rate with respect to term loans under the Term Loan B was based on, at the Company’s option, (a) adjusted LIBOR plus 2.25% (with a LIBOR floor of 0.75% ) or (b) JPMorgan Chase Bank, N.A.’s prime rate (" ABR ") plus 1.25% (with an ABR floor of 1.75% ). See Note 19, "Subsequent Events" for a description of the February 2018 refinancing. (4) The Term Loan A provided for quarterly amortization payments, which commenced March 31, 2016, totaling per annum 5% , 5% , 7.5% , 10.0% and 12.5% of the original principal amount of the Term Loan A in 2016, 2017, 2018, 2019 and 2020, respectively. The interest rates with respect to term loans under the Term Loan A were based on, at the Company's option, (a) adjusted LIBOR plus an additional margin or (b) ABR plus an additional margin, in each case subject to adjustment based on the then current senior secured leverage ratio. Based on the previous quarter senior secured leverage ratio, the LIBOR margin was 2.00% and the ABR margin was 1.00% for the three months ended December 31, 2017 . See Note 19, "Subsequent Events" for a description of the February 2018 refinancing. (5) The Term Loan A-1 provided for quarterly amortization payments, which commenced on September 30, 2016, totaling per annum 2.5% , 2.5% , 5% , 7.5% and 10.0% of the original principal amount of the Term Loan A-1, with the last amortization payment made on June 30, 2021. The interest rates with respect to term loans under the Term Loan A-1 were based on, at the Company's option, (a) adjusted LIBOR plus an additional margin or (b) ABR plus an additional margin, in each case subject to adjustment based on the then current senior secured leverage ratio. Based on the previous quarter senior secured leverage ratio, the LIBOR margin was 2.00% and the ABR margin was 1.00% for the three months ended December 31, 2017 . See Note 19, "Subsequent Events" for a description of the February 2018 refinancing. (6) Available capacity is subject to maintaining sufficient relocation related assets to collateralize these securitization obligations. (7) In November 2017, the capacity of the Apple Ridge facility was reduced from $325 million to $250 million . As of December 31, 2017 , the Company had $250 million of borrowing capacity under the Apple Ridge Funding LLC securitization program leaving $69 million of available capacity. (8) Consists of a £10 million revolving loan facility and a £5 million working capital facility. As of December 31, 2017 , the Company had $20 million of borrowing capacity under the Cartus Financing Limited securitization program leaving $7 million of available capacity. (9) Not included in this table is the Company's Unsecured Letter of Credit Facility which had a capacity of $74 million with $69 million utilized at a weighted average rate of 3.24% at December 31, 2017 . Maturities Table As of December 31, 2017 , the combined aggregate amount of maturities for long-term borrowings, excluding securitization obligations, for each of the next five years is as follows: Year Amount 2018 (a) $ 127 2019 527 2020 356 2021 837 2022 1,039 _______________ (a) The current portion of long-term debt consists of four quarters of 2018 amortization payments totaling $33 million , $13 million and $11 million for the Term Loan A, Term Loan A-1 and Term Loan B facilities, respectively, as well as $70 million of revolver borrowings under the revolving credit facility which expires in October 2020, but are classified on the balance sheet as current due to the revolving nature of the facility. See Note 19, "Subsequent Events" for a description of the February 2018 refinancing. Senior Secured Credit Facility In July 2016, the Company entered into a third amendment (the "Third Amendment") to the Amended and Restated Credit Agreement dated as of March 5, 2013, as amended. The Third Amendment replaced the $1,858 million Term Loan B due March 2020 with a new $1,100 million Term Loan B due July 20, 2022. In January 2017, the Company entered into a fourth amendment (the "Fourth Amendment") to the Amended and Restated Credit Agreement (as so amended, the "Senior Secured Credit Agreement") that repriced the Term Loan B through a refinancing of the existing term loan with a new Term Loan B. The Fourth Amendment reduced the interest rate by 75 basis points but did not change the maturity date for the Term Loan B. The Company also entered into an Incremental Assumption Agreement to the Senior Secured Credit Agreement pursuant to which the Company increased the borrowing capacity under its Revolving Credit Facility to $1,050 million from the existing $815 million . The Senior Secured Credit Agreement provides for: (a) a Term Loan B issued in the original aggregate principal amount of $1,100 million with a maturity date of July 2022. The Term Loan B has quarterly amortization payments totaling 1% per annum of the initial aggregate principal amount. The interest rate with respect to term loans under the Term Loan B is based on, at Realogy Group's option, adjusted LIBOR plus 2.25% (with a LIBOR floor of 0.75% ) or ABR plus 1.25% (with an ABR floor of 1.75% ); and (b) a $1,050 million Revolving Credit Facility with a maturity date of October 23, 2020, which includes (i) a $125 million letter of credit subfacility and (ii) a swingline loan subfacility. The interest rate with respect to revolving loans under the Revolving Credit Facility is based on, at Realogy Group's option, adjusted LIBOR or ABR plus an additional margin subject to the following adjustments based on the Company’s then current senior secured leverage ratio: Senior Secured Leverage Ratio Applicable LIBOR Margin Applicable ABR Margin Greater than 3.50 to 1.00 2.50% 1.50% Less than or equal to 3.50 to 1.00 but greater than or equal to 2.50 to 1.00 2.25% 1.25% Less than 2.50 to 1.00 2.00% 1.00% The Senior Secured Credit Agreement permits the Company to obtain up to $500 million of additional credit facilities from lenders reasonably satisfactory to the administrative agent and us, without the consent of the existing lenders under the new senior secured credit facility, plus an unlimited amount if Realogy Group's senior secured leverage ratio is less than 3.50 to 1.00 on a pro forma basis. Subject to certain restrictions, the Senior Secured Credit Agreement also permits us to issue senior secured or unsecured notes in lieu of any incremental facility. The obligations under the Senior Secured Credit Agreement are secured to the extent legally permissible by substantially all of the assets of Realogy Group, Realogy Intermediate and all of their domestic subsidiaries, other than certain excluded subsidiaries. Realogy Group’s Senior Secured Credit Agreement contains financial, affirmative and negative covenants and requires Realogy Group to maintain a senior secured leverage ratio, not to exceed 4.75 to 1.00 . The leverage ratio is tested quarterly regardless of the amount of borrowings outstanding and letters of credit issued under the revolver at the testing date. Total senior secured net debt does not include unsecured indebtedness, including the Unsecured Notes as well as the securitization obligations. At December 31, 2017 , Realogy Group was in compliance with the senior secured leverage ratio covenant. See Note 19, "Subsequent Events" for a description of the Refinancing in February 2018 which resulted in: (i) increasing the capacity of the revolving credit facility from $1,050 million to $1,400 million and extending the maturity date from October 2020 to February 2023 ; (ii) aggregating the existing Term Loan A and Term Loan A-1 tranches due October 2020 and July 2021 , respectively, into a new single tranche of $750 million Term Loan A due February 2023 ; and (iii) refinancing the existing $1,083 million Term Loan B due July 2022 with a new Term Loan B issued at par in the amount of $1,080 million with a maturity date in February 2025 . Term Loan A Facility In October 2015, Realogy Group entered into the Term Loan A senior secured credit agreement which provides for a five -year, $435 million loan issued at par with a maturity date of October 23, 2020 (the “Term Loan A”) and has terms substantially similar to the Senior Secured Credit Agreement. The Term Loan A provides for quarterly amortization payments, which commenced March 31, 2016, totaling the amount per annum equal to the following percentages of the original principal amount of the Term Loan A: 5% , 5% , 7.5% , 10.0% and 12.5% for amortizations payable in 2016, 2017, 2018, 2019 and 2020, with the balance payable upon the final maturity date. The interest rates with respect to term loans under the Term Loan A are based on, at our option, adjusted LIBOR or ABR plus an additional margin subject to the following adjustments based on the Company’s then current senior secured leverage ratio: Senior Secured Leverage Ratio Applicable LIBOR Margin Applicable ABR Margin Greater than 3.50 to 1.00 2.50% 1.50% Less than or equal to 3.50 to 1.00 but greater than or equal to 2.50 to 1.00 2.25% 1.25% Less than 2.50 to 1.00 2.00% 1.00% In July 2016, Realogy Group entered into a first amendment to the Term Loan A senior secured credit agreement. Under the amendment, the Company issued the Term Loan A-1 in the amount of $355 million with a maturity date in July 2021 under its existing Term Loan A Facility and on terms substantially similar to its existing Term Loan A. The Term Loan A-1 provides for quarterly amortization payments totaling per annum 2.5% , 2.5% , 5.0% , 7.5% and 10.0% of the original principal amount of the Term Loan A-1, which commenced September 30, 2016 continuing through June 30, 2021. The interest rates with respect to term loans under the Term Loan A-1 are based on, at our option, adjusted LIBOR or ABR plus an additional margin subject to the following adjustments based on the Company’s then current senior secured leverage ratio: Senior Secured Leverage Ratio Applicable LIBOR Margin Applicable ABR Margin Greater than 3.50 to 1.00 2.50% 1.50% Less than or equal to 3.50 to 1.00 but greater than or equal to 2.50 to 1.00 2.25% 1.25% Less than 2.50 to 1.00 but greater than or equal to 2.00 to 1.00 2.00% 1.00% Less than 2.00 to 1.00 1.75% 0.75% Consistent with the Senior Secured Credit Agreement, the Term Loan A Facility permits the Company to obtain up to $500 million of additional credit facilities from lenders reasonably satisfactory to the administrative agent and the company, without the consent of the existing lenders under the Term Loan A, plus an unlimited amount if the Company's senior secured leverage ratio is less than 3.50 to 1.00 on a pro forma basis. Subject to certain restrictions, the Term Loan A Facility also permits us to issue senior secured or unsecured notes in lieu of any incremental facility. Unsecured Notes The 4.50% Senior Notes, 5.25% Senior Notes and 4.875% Senior Notes (each as defined below, collectively the "Unsecured Notes") are unsecured senior obligations of Realogy Group that mature on April 15, 2019, December 1, 2021 and June 1, 2023, respectively. Interest on the Unsecured Notes is payable each year semiannually on April 15 and October 15 for the 4.50% Senior Notes and June 1 and December 1 for both the 5.25% Senior Notes and 4.875% Senior Notes. The Unsecured Notes are guaranteed on an unsecured senior basis by each domestic subsidiary of Realogy Group that is a guarantor under the Senior Secured Credit Facility and Realogy Group's outstanding debt securities, and are guaranteed by Realogy Holdings on an unsecured senior subordinated basis. Other Debt Facilities The Company has an Unsecured Letter of Credit Facility to provide for the issuance of letters of credit required for general corporate purposes by the Company. At December 31, 2017 , the capacity of the facility was $74 million with $69 million being utilized and at December 31, 2016 , the capacity of the facility was $131 million with $127 million being utilized. In August 2017, the standby irrevocable letter of credit, which was utilized to support the Company's payment obligations with respect to its share of Cendant contingent and other corporate liabilities, was terminated as a result of the resolution of a Cendant legacy tax matter, reducing the capacity and outstanding letters of credit under the Unsecured Letter of Credit Facility. The facility's expiration dates are as follows: Capacity (in millions) Expiration Date $8 September 2018 $66 December 2019 The fixed pricing to the Company is based on a spread above the credit default swap rate for senior unsecured debt obligations of the Company over the applicable letter of credit period. Realogy Group's obligations under the Unsecured Letter of Credit Facility are guaranteed on an unsecured senior basis by each domestic subsidiary of Realogy Group that is a guarantor under the Senior Secured Credit Facility and Realogy Group's outstanding debt securities. Securitization Obligations Realogy Group has secured obligations through Apple Ridge Funding LLC under a securitization program. In June 2017, Realogy Group extended the program until June 2018. In November 2017, the capacity of the Apple Ridge facility was reduced from $325 million to $250 million . At December 31, 2017 , Realogy Group had $181 million of outstanding borrowings under the facility. Realogy Group, through a special purpose entity known as Cartus Financing Limited, has agreements providing for a £10 million revolving loan facility and a £5 million working capital facility. In September 2017, Realogy Group extended the existing Cartus Financing Limited securitization program to August 2018. There were $13 million of outstanding borrowings on the facilities at December 31, 2017 . These Cartus Financing Limited facilities are secured by the relocation assets of a U.K. government contract in this special purpose entity and are therefore classified as permitted securitization financings as defined in Realogy Group’s Senior Secured Credit Facility and the indentures governing the Unsecured Notes. The Apple Ridge entities and the Cartus Financing Limited entity are consolidated special purpose entities that are utilized to securitize relocation receivables and related assets. These assets are generated from advancing funds on behalf of clients of Realogy Group’s relocation business in order to facilitate the relocation of their employees. Assets of these special purpose entities are not available to pay Realogy Group’s general obligations. Under the Apple Ridge program, provided no termination or amortization event has occurred, any new receivables generated under the designated relocation management agreements are sold into the securitization program and as new eligible relocation management agreements are entered into, the new agreements are designated to the program. The Apple Ridge program has restrictive covenants and trigger events, including performance triggers linked to the age and quality of the underlying assets, foreign obligor limits, multicurrency limits, financial reporting requirements, restrictions on mergers and change of control, any uncured breach of Realogy Group’s senior secured leverage ratio under Realogy Group’s Senior Secured Credit Facility, and cross-defaults to Realogy Group’s material indebtedness. The occurrence of a trigger event under the Apple Ridge securitization facility could restrict our ability to access new or existing funding under this facility or result in termination of the facility, either of which would adversely affect the operation of our relocation business. Certain of the funds that Realogy Group receives from relocation receivables and related assets must be utilized to repay securitization obligations. These obligations were collateralized by $218 million and $238 million of underlying relocation receivables and other related relocation assets at December 31, 2017 and 2016 , respectively. Substantially all relocation related assets are realized in less than twelve months from the transaction date. Accordingly, all of Realogy Group’s securitization obligations are classified as current in the accompanying Consolidated Balance Sheets. Interest incurred in connection with borrowings under these facilities amounted to $7 million and $6 million for the years ended December 31, 2017 and December 31, 2016 , respectively. This interest is recorded within net revenues in the accompanying Consolidated Statements of Operations as related borrowings are utilized to fund Realogy Group's relocation business where interest is generally earned on such assets. These securitization obligations represent floating rate debt for which the average weighted interest rate was 3.3% and 2.6% for the years ended December 31, 2017 and 2016 , respectively. Loss on the Early Extinguishment of Debt As a result of the refinancing transaction in January of 2017 and reduction of the Unsecured Letter of Credit Facility in September of 2017, the Company recorded losses on the early extinguishment of debt of $5 million during the year ended December 31, 2017. As a result of refinancing transactions, note repurchases and note redemptions, the Company recorded a loss on the early extinguishment of debt of $48 million during the year ended December 31, 2015. |
Note 9. Employee Benefit Plans
Note 9. Employee Benefit Plans Employee Benefit Plans (Notes) | 12 Months Ended |
Dec. 31, 2017 | |
Retirement Benefits [Abstract] | |
Employee Benefit Plans | EMPLOYEE BENEFIT PLANS DEFINED BENEFIT PENSION PLAN The Company’s defined benefit pension plan was closed to new entrants as of July 1, 1997 and existing participants do not accrue any additional benefits. The net periodic pension cost for both 2017 and 2016 was $1 million and was comprised of interest cost of approximately $6 million and the amortization of the actuarial net loss of $2 million , partially offset by a benefit of $7 million for the expected return on assets. At December 31, 2017 and 2016 , the accumulated benefit obligation of this plan was $145 million and $147 million , respectively, and the fair value of the plan assets were $108 million and $104 million , respectively, resulting in an unfunded accumulated benefit obligation of $37 million and $43 million , respectively, which is recorded in Other non-current liabilities in the Consolidated Balance Sheets. Estimated future benefit payments as of December 31, 2017 are as follows: Year Amount 2018 $ 9 2019 9 2020 9 2021 10 2022 10 2023 through 2027 47 The minimum funding required during 2018 is estimated to be $3 million . The following table presents the fair values of plan assets by category as of December 31, 2017 : Asset Category Quoted Price in Active Market for Identical Assets (Level I) Significant Other Observable Inputs (Level II) Significant Unobservable Inputs (Level III) Total Cash and cash equivalents $ 1 $ — $ — $ 1 Equity securities — 71 — 71 Fixed income securities — 36 — 36 Total $ 1 $ 107 $ — $ 108 The following table presents the fair values of plan assets by category as of December 31, 2016 : Asset Category Quoted Price in Active Market for Identical Assets (Level I) Significant Other Observable Inputs (Level II) Significant Unobservable Inputs (Level III) Total Cash and cash equivalents $ 1 $ — $ — $ 1 Equity securities — 74 — 74 Fixed income securities — 29 — 29 Total $ 1 $ 103 $ — $ 104 OTHER EMPLOYEE BENEFIT PLANS The Company also maintains post-retirement health and welfare plans for certain subsidiaries and a non-qualified pension plan for certain individuals. At both December 31, 2017 and 2016 , the related projected benefit obligation for these plans accrued on the Company’s Consolidated Balance Sheets (primarily within other non-current liabilities) was $6 million . DEFINED CONTRIBUTION SAVINGS PLAN The Company sponsors a defined contribution savings plan that provides certain of its eligible employees an opportunity to accumulate funds for retirement and has a Company match for a portion of the contributions made by participating employees. The Company’s cost for contributions to this plan was $16 million , $15 million and $14 million for the years ended December 31, 2017 , 2016 and 2015 , respectively. |
Note 10. Income Taxes Income Ta
Note 10. Income Taxes Income Taxes (Notes) | 12 Months Ended |
Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |
Income Tax Disclosure [Text Block] | INCOME TAXES The components of pretax income for domestic and foreign operations consisted of the following: Year Ended December 31, 2017 2016 2015 Domestic $ 365 $ 351 $ 290 Foreign 4 10 8 Pretax income $ 369 $ 361 $ 298 The components of income tax (benefit) expense consisted of the following: Year Ended December 31, 2017 2016 2015 Current: Federal $ (7 ) $ 10 $ 8 State 4 8 3 Foreign 1 2 3 Total current (2 ) 20 14 Deferred: Federal (72 ) 107 91 State 9 16 4 Foreign — 1 1 Total deferred (63 ) 124 96 Income tax (benefit) expense $ (65 ) $ 144 $ 110 The Tax Cuts and Jobs Act of 2017 (the “2017 Tax Act”), which became law on December 22, 2017, will reduce the U.S. Federal corporate tax rate from 35% to 21% for tax years beginning in 2018. The $65 million income tax benefit includes a tax benefit of approximately $184 million due to the re-measurement of the Company’s net deferred tax liabilities associated with the 2017 Tax Act and a $32 million reduction in the Company's reserve for uncertain tax positions, partially offset by current operating results. The recorded net benefit related to the 2017 Tax Act is a provisional amount that reflects the Company’s reasonable estimate at this time, and is subject to adjustment during a measurement period not to exceed one year from enactment in accordance with guidance from the Securities and Exchange Commission. A reconciliation of the Company’s effective income tax rate at the U.S. federal statutory rate of 35% to the actual expense was as follows: Year Ended December 31, 2017 2016 2015 Federal statutory rate 35 % 35 % 35 % State and local income taxes, net of federal tax benefits 4 4 2 Impact of the 2017 Tax Act (50 ) — — Permanent differences — 1 1 Uncertain tax positions (9 ) — — Net change in valuation allowance 1 — 1 Other 1 — (2 ) Effective tax rate (18 %) 40 % 37 % Deferred income taxes result from temporary differences between the amount of assets and liabilities recognized for financial reporting and tax purposes. The components of the deferred income tax assets and liabilities, as of December 31, are as follows: 2017 2016 Deferred income tax assets: Net operating loss carryforwards $ 288 $ 503 Tax credit carryforwards 35 41 Accrued liabilities and deferred income 85 131 Minimum pension obligations 16 23 Provision for doubtful accounts 8 16 Liability for unrecognized tax benefits 1 3 Interest rate swaps 2 8 Total deferred tax assets 435 725 Less: valuation allowance (13 ) (10 ) Total deferred income tax assets after valuation allowance 422 715 Deferred income tax liabilities: Depreciation and amortization 736 1,099 Prepaid expenses 2 1 Undistributed foreign earnings — 2 Basis difference in investment in joint ventures 10 2 Total deferred tax liabilities 748 1,104 Net deferred income tax liabilities $ (326 ) $ (389 ) Deferred tax assets and deferred tax liabilities are netted by tax jurisdiction. The Net deferred income tax liability of $326 million as of December 31, 2017 is included in the accompanying Consolidated Balance Sheets with $327 million in deferred income taxes (non-current liabilities) and $1 million in other non-current assets. The Net deferred income tax liability of $389 million as of December 31, 2016 is included in the accompanying Consolidated Balance Sheets with the entire $389 million in deferred income taxes (non-current liabilities). As of December 31, 2017 , the Company had gross federal and state net operating loss carryforwards of $1,026 million . The federal net operating loss carryforwards expire between 2027 and 2033 and the state net operating loss carryforwards expire between 2018 and 2033. Accounting for Uncertainty in Income Taxes The Company utilizes the FASB guidance for accounting for uncertainty in income taxes, which prescribes a recognition threshold and a measurement attribute for the financial statement recognition and measurement of tax positions taken or expected to be taken in a tax return. The Company reflects changes in its liability for unrecognized tax benefits as income tax expense in the Consolidated Statements of Operations. As of December 31, 2017 , the Company’s gross liability for unrecognized tax benefits was $22 million , of which $19 million would affect the Company’s effective tax rate, if recognized. The Company does not expect that its unrecognized tax benefits will significantly change over the next 12 months. The Company files U.S., state and foreign income tax returns in jurisdictions with varying statutes of limitations. Tax returns for the 2006 through 2017 tax years remain subject to examination by federal and certain state tax authorities. In significant foreign jurisdictions, tax returns for the 2008 through 2017 tax years generally remain subject to examination by their respective tax authorities. The Company believes that it is reasonably possible that the total amount of its unrecognized tax benefits could decrease by $2 million in certain taxing jurisdictions where the statute of limitations is set to expire within the next 12 months . The Company recognizes accrued interest and penalties related to unrecognized tax benefits in interest expense and operating expenses, respectively. The Company recognized a reduction of interest expense of $2 million for the year ended December 31, 2017 , a reduction of interest expense of $4 million for the year ended December 31, 2016 and reduction of interest expense of $1 million for the year ended December 31, 2015 . The rollforward of unrecognized tax benefits are summarized in the table below: Unrecognized tax benefits—January 1, 2015 $ 106 Gross decreases—tax positions in prior periods (4 ) Gross increases—tax positions in current period 1 Settlements (23 ) Reduction due to lapse of statute of limitations (2 ) Unrecognized tax benefits—December 31, 2015 78 Gross increases—tax positions in prior periods 3 Reduction due to lapse of statute of limitations (3 ) Unrecognized tax benefits—December 31, 2016 78 Gross increases—tax positions in prior periods 1 Gross decreases—tax positions in prior periods (54 ) Reduction due to lapse of statute of limitations (3 ) Unrecognized tax benefits—December 31, 2017 $ 22 The Company is subject to income taxes in the United States and several foreign jurisdictions. Significant judgment is required in determining the worldwide provision for income taxes and recording related assets and liabilities. In the ordinary course of business, there are many transactions and calculations where the ultimate tax determination is uncertain. The Company is regularly under audit by tax authorities whereby the outcome of the audits is uncertain. The Company believes there is appropriate support for positions taken on its tax returns. The liabilities that have been recorded represent the best estimates of the probable loss on certain positions and are adequate for all open years based on an assessment of many factors including past experience and interpretations of tax law applied to the facts of each matter. However, the outcomes of tax audits are inherently uncertain. Tax Sharing Agreement Under the Tax Sharing Agreement with Cendant, Wyndham Worldwide and Travelport, the Company is generally responsible for 62.5% of payments made to settle claims with respect to tax periods ending on or prior to December 31, 2006 that relate to income taxes imposed on Cendant and certain of its subsidiaries, the operations (or former operations) of which were determined by Cendant not to relate specifically to the respective businesses of Realogy, Wyndham Worldwide, Avis Budget or Travelport. With respect to any remaining residual legacy Cendant tax liabilities, the Company and its former parent believe there is appropriate support for the positions taken on Cendant’s tax returns. However, tax audits and any related litigation, including disputes or litigation on the allocation of tax liabilities between parties under the Tax Sharing Agreement, could result in outcomes for the Company that are different from those reflected in the Company’s historical financial statements. |
Note 11. Restructuring Costs Re
Note 11. Restructuring Costs Restructuring Costs (Notes) | 12 Months Ended |
Dec. 31, 2017 | |
Restructuring and Related Activities [Abstract] | |
Restructuring Costs | RESTRUCTURING COSTS Restructuring charges for the years ended December 31, 2017 , 2016 and 2015 were $12 million , $39 million and $10 million , respectively. The components of the restructuring charges for the years ended December 31, 2017 , 2016 and 2015 were as follows: Years Ended December 31, 2017 2016 2015 Personnel-related costs (1) $ 7 $ 22 $ 3 Facility-related costs (2) 3 10 3 Accelerated depreciation on asset disposals 1 1 — Other restructuring costs (3) 1 6 4 Total restructuring charges $ 12 $ 39 $ 10 _______________ (1) Personnel-related costs consist of severance costs provided to employees who have been terminated and duplicate payroll costs during transition. (2) Facility-related costs consist of costs associated with planned facility closures such as contract termination costs, lease payments that will continue to be incurred under the contract for its remaining term without economic benefit to the Company and other facility and employee relocation related costs. (3) Other restructuring costs consist of costs related to professional fees, consulting fees and other costs associated with restructuring activities which are primarily included in the Corporate and Other business segment. Business Optimization Initiative During the fourth quarter of 2015, the Company began a business optimization initiative that focused on maximizing the efficiency and effectiveness of the cost structure of each of the Company's business units. The action was designed to improve client service levels across each of the business units while enhancing the Company's profitability and incremental margins. The plan focused on several key areas of opportunity which include process improvement efficiencies, office footprint optimization, leveraging technology and media spend, centralized procurement, outsourcing administrative services and organizational design. The expected costs of activities undertaken in connection with the restructuring plan are largely complete. The following is a reconciliation of the beginning and ending restructuring reserve balances for the Business Optimization Initiative: Personnel-related costs Facility-related costs Accelerated depreciation asset disposals Other restructuring costs Total Balance at October 1, 2015 $ — $ — $ — $ — $ — Restructuring charges 3 3 — 4 10 Costs paid or otherwise settled — — — (1 ) (1 ) Balance at December 31, 2015 $ 3 $ 3 $ — $ 3 $ 9 Restructuring charges 22 10 1 6 39 Costs paid or otherwise settled (16 ) (6 ) (1 ) (9 ) (32 ) Balance at December 31, 2016 $ 9 $ 7 $ — $ — $ 16 Restructuring charges 7 3 1 1 12 Costs paid or otherwise settled (13 ) (7 ) — (1 ) (21 ) Balance at December 31, 2017 $ 3 $ 3 $ 1 $ — $ 7 The following table shows the total restructuring costs expected to be incurred by type of cost for the Business Optimization Initiative: Total amount expected to be incurred Amount incurred to date Total amount remaining to be incurred Personnel-related costs $ 32 $ 32 $ — Facility-related costs 16 16 — Accelerated depreciation related to asset disposals 3 2 1 Other restructuring costs 12 11 1 Total $ 63 $ 61 $ 2 The following table shows the total restructuring costs expected to be incurred by reportable segment for the Business Optimization Initiative: Total amount expected to be incurred Amount incurred to date Total amount remaining to be incurred Real Estate Franchise Services $ 5 $ 5 $ — Company Owned Real Estate Brokerage Services 36 36 — Relocation Services 5 5 — Title and Settlement Services 2 2 — Corporate and Other 15 13 2 Total $ 63 $ 61 $ 2 |
Note 12. Stock-Based Compensati
Note 12. Stock-Based Compensation Stock-Based Compensation (Notes) | 12 Months Ended |
Dec. 31, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock-Based Compensation | STOCK-BASED COMPENSATION The Company issues incentive equity awards, such as non-qualified stock options, restricted stock units ("RSUs"), performance restricted stock units ("PRSUs") and performance share units ("PSUs"), to employees, consultants and directors of Realogy under its 2012 Long-Term Incentive Plan and Amended and Restated 2012 Long-Term Incentive Plan ("the Plans"). The Plans include a retirement provision for equity grants which provide for continued vesting of awards once an employee has attained the age of 65 years , or 55 years of age or older plus at least ten years of tenure with the Company, provided they have been employed or provided services to the Company for one year following the date of grant or start of the performance period. There has been a total of 16.6 million shares authorized for issuance under the Plans with approximately 3 million shares available for future grants. Incentive Equity Awards Granted by the Company In October 2017, the Company announced that Ryan Schneider had been elected as President and Chief Operating Officer of the Company and appointed as a member of the Company’s Board of Directors. In accordance with the succession plan developed by the Board, Mr. Schneider was named Chief Executive Officer (the “CEO”) on December 31, 2017. Mr. Schneider was granted an inducement equity award with an aggregate grant date fair value of $5 million consisting of: (i) $2.5 million in RSUs and (ii) $2.5 million in non-qualified stock options, with the RSUs vesting in equal annual installments over a three-year period and with the options becoming exercisable in equal annual installments over a four-year period, in each case, based on continued service through the vesting date. A summary of activity for the year ended December 31, 2017 is presented below (number of shares in millions): Restricted Stock Units Weighted Average Grant Date Fair Value Performance Share Units (a) Weighted Average Grant Date Fair Value Options (f) Weighted Average Exercise Price Outstanding at January 1, 2017 1.5 $ 37.72 1.4 $ 38.31 3.3 $ 31.69 Granted 1.2 28.61 0.7 27.70 0.7 29.60 Distributed/Exercised (0.6 ) (b) 39.64 (0.3 ) (c) 42.30 (0.3 ) (d) 23.29 Forfeited/Expired (0.1 ) 30.90 — — (0.1 ) 50.24 Outstanding at December 31, 2017 2.0 $ 31.71 1.8 $ 33.16 3.6 (e) $ 31.75 _______________ (a) The PSU amounts in the table are shown at the target amount of the award. (b) The total fair value of RSUs which were distributed during the year ended December 31, 2017 was $26 million . (c) The total fair value of PSUs which were distributed during the year ended December 31, 2017 was $14 million , which includes the distribution of PSUs awarded in 2014, measuring performance over a three-year performance period ended December 31, 2016, at a fair value of $10 million . Amounts distributed do not include 0.2 million PSUs awarded in 2015, measuring performance over a three-year period ended and vested December 31, 2017, at a fair value of $9 million and at a weighted average grant date fair value of $46.46 . These PSUs were distributed in early 2018. (d) The intrinsic value of options exercised during the year ended December 31, 2017 was $2 million . Cash received from options exercised during the year ended December 31, 2017 was $8 million . (e) Options outstanding at December 31, 2017 have an intrinsic value of $6 million and have a weighted average remaining contractual life of 5.8 years . (f) The following table summarizes information regarding exercisable stock options as of December 31, 2017 : Range of Exercise Prices Options Vested Weighted Average Exercise Price Aggregate Intrinsic Value Weighted Average Remaining Contractual Life $15.00 to $50.00 2.4 $ 27.86 $ 6.3 4.7 years $50.01 and above 0.1 $ 140.26 $ — 2.8 years Awards granted annually include a mix of RSUs (PRSUs for the CEO and direct reports), options and PSUs. The RSUs and PRSUs vest over three years, with 33.33% vesting on each anniversary of the grant date. The fair value of RSUs and PRSUs are equal to the closing sale price of the Company's common stock on the date of grant. Time-vesting of the PRSUs for the CEO and direct reports is subject to achievement of a minimum EBITDA performance goal during the year that the award was granted. The PSUs are incentives that reward grantees based upon the Company's financial performance over a three -year performance period which begins January 1st of the grant year and ends on December 31st of the third year following the grant year. There are two PSU awards: one is based upon the total stockholder return of Realogy's common stock relative to the total stockholder return of the SPDR S&P Homebuilders Index ("XHB") (the "RTSR award"), and the other is based upon the achievement of cumulative free cash flow goals. The number of shares that may be issued under the PSU is variable and based upon the extent to which the performance goals are achieved over the performance period (with a range of payout from 0% to 175% of target for the RTSR award and 0% to 200% of target for the achievement of cumulative free cash flow award). The shares earned will be distributed during the first quarter after the end of the performance period. The fair value of PSUs without a market condition is equal to the closing sale price of the Company's common stock on the date of grant. The fair value of the PSU RTSR award was estimated on the date of grant using the Monte Carlo Simulation method utilizing the following assumptions: 2017 RTSR PSU 2016 RTSR PSU 2015 RTSR PSU Weighted average grant date fair value $ 27.98 $ 27.99 $ 41.08 Weighted average expected volatility (a) 29.0 % 28.1 % 25.1 % Weighted average volatility of XHB 18.4 % 19.4 % 21.1 % Weighted average correlation coefficient 0.53 0.58 0.57 Weighted average risk-free interest rate 1.5 % 0.9 % 1.0 % Weighted average dividend yield — — — _______________ (a) Expected volatility is based on historical volatilities of the Company and select comparable companies. The stock options have a maximum term of ten years and vest over four years, with 25% vesting on each anniversary date of the grant date. The options have an exercise price equal to the closing sale price of the Company's common stock on the date of grant. The fair value of the options was estimated on the date of grant using the Black-Scholes option-pricing model utilizing the following assumptions: 2017 Options 2016 Options 2015 Options Weighted average grant date fair value $ 8.61 $ 10.81 $ 17.66 Weighted average expected volatility (a) 30.7 % 31.7 % 36.1 % Weighted average expected term (years) (b) 6.25 6.25 6.25 Weighted average risk-free interest rate (c) 2.0 % 1.3 % 1.6 % Weighted average dividend yield 1.2 % 0.1 % — % _______________ (a) Expected volatility was based on historical volatilities of the Company and select comparable companies. (b) The expected term of the options granted represents the period of time that options are expected to be outstanding and is based on the simplified method. (c) The risk-free interest rate was based on the U.S. Treasury yield curve in effect at the time of the grant, which corresponds to the expected term of the options. Stock-Based Compensation Expense As of December 31, 2017 , based on current performance achievement expectations, there was $36 million of unrecognized compensation cost related to incentive equity awards under the plans which will be recorded in future periods as compensation expense over a remaining weighted average period of approximately 1.9 years . The Company recorded stock-based compensation expense related to the incentive equity awards of $52 million , $57 million and $57 million for the years ended December 31, 2017 , 2016 and 2015 , respectively. |
Note 13. Commitments And Contin
Note 13. Commitments And Contingencies Commitments And Contingencies (Notes) | 12 Months Ended |
Dec. 31, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies [Text Block] | COMMITMENTS AND CONTINGENCIES Litigation The Company is involved in claims, legal proceedings, alternative dispute resolution and governmental inquiries related to alleged contract disputes, business practices, intellectual property and other commercial, employment, regulatory and tax matters. Examples of such matters include but are not limited to allegations: • that the Company is vicariously liable for the acts of franchisees under theories of actual or apparent agency; • by current or former franchisees that franchise agreements were breached including improper terminations; • concerning claims for alleged RESPA or state real estate law violations including but not limited to claims challenging the validity of sales agent indemnification, and administrative fees; • that residential real estate sales agents engaged by NRT—under certain state or federal laws—are potentially employees instead of independent contractors, and they or regulators therefore may bring claims against NRT for breach of contract, wage and hour classification claims, wrongful discharge, unemployment and workers' compensation and could seek benefits, back wages, overtime, indemnification, penalties related to classification practices and expense reimbursement available to employees; • concerning other employment law matters, including wage and hour claims; • concerning claims generally against the company owned brokerage operations for negligence, misrepresentation or breach of fiduciary duty in connection with the performance of real estate brokerage or other professional services as well as other brokerage claims associated with listing information and property history; • related to copyright law, including infringement actions alleging improper use of copyrighted photographs on websites or in marketing materials without consent of the copyright holder; • concerning claims generally against the title company contending that, as the escrow company, the company knew or should have known that a transaction was fraudulent or concerning other title defects or settlement errors; • concerning information security and cyber-crime, including claims related to the diversion of homesale transaction closing funds and/or the protection of the privacy and personally identifiable information of our customers and employees; • concerning anti-trust and anti-competition matters; and • those related to general fraud claims. Real Estate Business Litigation Dodge, et al. v. PHH Corporation, et al., formerly captioned Strader, et al. and Hall v. PHH Corporation, et al. (U.S. District Court for the Central District of California). This is a purported class action brought by four California residents against 15 defendants, including Realogy and certain of its subsidiaries, PHH Corporation and PHH Home Loans, LLC (a joint venture between Realogy and PHH), alleging violations of Section 8(a) of RESPA. Plaintiffs seek to represent two subclasses comprised of all persons in the United States who, since January 31, 2005, (1) obtained a RESPA-covered mortgage loan from either (a) PHH Home Loans, LLC or one of its subsidiaries, or (b) one of the mortgage services managed by PHH Corporation for other lenders, and (2) paid a fee for title insurance or settlement services to TRG or one of its subsidiaries. Plaintiffs allege, among other things, that PHH Home Loans, LLC operates in violation of RESPA and that the other defendants violate RESPA by referring business to one another under agreements or arrangements. Plaintiffs seek treble damages and an award of attorneys’ fees, costs and disbursements. On May 19, 2017, the parties held a mediation session, at which they agreed in principle to a settlement of the action, pursuant to which the Company would pay approximately $8 million (or one-half of the settlement). As a result, the Company accrued $8 million in the second quarter of 2017 and the liability is included in accrued expenses and other current liabilities on the Consolidated Balance Sheets. On July 31, 2017, the fourth amended complaint was filed changing the named plaintiffs. At a hearing on the plaintiffs' motion for preliminary approval of the settlement held October 19, 2017, the Court indicated that if certain modest revisions were made to the settlement agreement and an amended motion for preliminary approval filed, the Court would grant preliminary approval. On January 29, 2018, the Court issued an order granting preliminary approval of the settlement, directed class notices to be sent by February 2018 and set the hearing on final approval of the settlement for August 16, 2018. The Company is involved in certain other claims and legal actions arising in the ordinary course of our business. Such litigation, regulatory actions and other proceedings may include, but are not limited to, actions relating to intellectual property, commercial arrangements, franchising arrangements, actions against our title company alleging it knew or should have known that others were committing mortgage fraud, standard brokerage disputes like the failure to disclose accurate square footage or hidden defects in the property such as mold, vicarious liability based upon conduct of individuals or entities outside of our control, including franchisees and independent sales agents, antitrust and anti-competition claims, general fraud claims, employment law claims, including claims challenging the classification of our sales agents as independent contractors, wage and hour classification claims and claims alleging violations of RESPA or state consumer fraud statutes. While the results of such claims and legal actions cannot be predicted with certainty, we do not believe based on information currently available to us that the final outcome of current proceedings against the Company will have a material adverse effect on our consolidated financial position, results of operations or cash flows. Cendant Corporate Litigation Realogy Group (then Realogy Corporation) separated from Cendant on July 31, 2006 (the "Separation"), pursuant to a plan by Cendant (now known as Avis Budget Group, Inc.) to separate into four independent companies-one for each of Cendant's business units-real estate services (Realogy Group), travel distribution services ("Travelport"), hospitality services, including timeshare resorts ("Wyndham Worldwide"), and vehicle rental ("Avis Budget Group"). Pursuant to the Separation and Distribution Agreement dated as of July 27, 2006 among Cendant, Realogy Group, Wyndham Worldwide and Travelport, (the "Separation and Distribution Agreement"), each of Realogy Group, Wyndham Worldwide and Travelport have assumed certain contingent and other corporate liabilities (and related costs and expenses), which are primarily related to each of their respective businesses. In addition, Realogy Group has assumed 62.5% and Wyndham Worldwide has assumed 37.5% of certain contingent and other corporate liabilities (and related costs and expenses) of Cendant or its subsidiaries, which are not primarily related to any of the respective businesses of Realogy Group, Wyndham Worldwide, Travelport and/or Cendant’s vehicle rental operations, in each case incurred or allegedly incurred on or prior to the date of the separation of Travelport from Cendant. * * * The Company believes that it has adequately accrued for legal matters as appropriate. The Company records litigation accruals for legal matters which are both probable and estimable. Litigation and other disputes are inherently unpredictable and subject to substantial uncertainties and unfavorable resolutions could occur. In addition, class action lawsuits can be costly to defend and, depending on the class size and claims, could be costly to settle. As such, the Company could incur judgments or enter into settlements of claims with liability that are materially in excess of amounts accrued and these settlements could have a material adverse effect on the Company’s financial condition, results of operations or cash flows in any particular period. Transfer of Cendant Corporate Liabilities, Issuance of Guarantees to Cendant and Affiliates and Contingent Liability Letter of Credit Realogy Group has certain guarantee commitments with Cendant (pursuant to the assumption of certain liabilities and the obligation to indemnify Cendant, Wyndham Worldwide and Travelport for such liabilities). These guarantee arrangements primarily relate to certain contingent litigation liabilities, contingent tax liabilities, and other corporate liabilities, of which Realogy Group assumed and is generally responsible for 62.5% . Upon separation from Cendant, the liabilities assumed by Realogy Group were comprised of certain Cendant corporate liabilities which were recorded on the historical books of Cendant as well as additional liabilities which were established for guarantees issued at the date of Separation related to certain unresolved contingent matters that could arise during the guarantee period. Regarding the guarantees, if any of the companies responsible for all or a portion of such liabilities were to default in its payment of costs or expenses related to any such liability, Realogy Group would be responsible for a portion of the defaulting party or parties’ obligation. To the extent such recorded liabilities are in excess or are not adequate to cover the ultimate payment amounts, such excess or deficiency will be reflected in the results of operations in future periods. In April 2007, the Company established a standby irrevocable letter of credit for the benefit of Avis Budget Group in accordance with the Separation and Distribution Agreement. The letter of credit was utilized to support the Company’s payment obligations with respect to its share of Cendant contingent and other corporate liabilities. The stated amount of the standby irrevocable letter of credit was subject to periodic adjustment to reflect the then current estimate of Cendant contingent and other liabilities. The standby irrevocable letter of credit terminates if (i) the Company’s senior unsecured credit rating is raised to BB by Standard and Poor’s or Ba2 by Moody’s or (ii) the aggregate value of the former parent contingent liabilities falls below $30 million . The letter of credit was $53 million at December 31, 2016. With the resolution of a Cendant legacy tax matter in 2017, the aggregate value of the former parent contingent liabilities fell below $30 million and therefore the standby irrevocable letter of credit was terminated in accordance with the agreement. The due to former parent balance was $18 million and $28 million at December 31, 2017 and December 31, 2016 , respectively. The due to former parent balance was comprised of the Company’s portion of the following: (i) Cendant’s remaining state and foreign contingent tax liabilities, (ii) accrued interest on contingent tax liabilities, (iii) potential liabilities related to Cendant’s terminated or divested businesses, and (iv) potential liabilities related to the residual portion of accruals for Cendant operations. Tax Matters The Company is subject to income taxes in the United States and several foreign jurisdictions. Significant judgment is required in determining the worldwide provision for income taxes and recording related assets and liabilities. In the ordinary course of business, there are many transactions and calculations where the ultimate tax determination is uncertain. The Company is regularly under audit by tax authorities whereby the outcome of the audits is uncertain. The Company believes there is appropriate support for positions taken on its tax returns. The liabilities that have been recorded represent the best estimates of the probable loss on certain positions and are adequate for all open years based on an assessment of many factors including past experience and interpretations of tax law applied to the facts of each matter. However, the outcomes of tax audits are inherently uncertain. Under the Tax Sharing Agreement with Cendant, Wyndham Worldwide and Travelport, the Company is generally responsible for 62.5% of payments made to settle claims with respect to tax periods ending on or prior to December 31, 2006 that relate to income taxes imposed on Cendant and certain of its subsidiaries, the operations (or former operations) of which were determined by Cendant not to relate specifically to the respective businesses of Realogy, Wyndham Worldwide, Avis Budget or Travelport. With respect to any remaining legacy Cendant tax liabilities, the Company and its former parent believe there is appropriate support for the positions taken on Cendant’s tax returns. However, tax audits and any related litigation, including disputes or litigation on the allocation of tax liabilities between parties under the Tax Sharing Agreement, could result in outcomes for the Company that are different from those reflected in the Company’s historical financial statements. Escrow and Trust Deposits As a service to its customers, the Company administers escrow and trust deposits which represent undisbursed amounts received for the settlement of real estate transactions. Deposits at FDIC-insured institutions are insured up to $250 thousand . These escrow and trust deposits totaled $469 million and $415 million at December 31, 2017 and 2016 , respectively. These escrow and trust deposits are not assets of the Company and, therefore, are excluded from the accompanying Consolidated Balance Sheets. However, the Company remains contingently liable for the disposition of these deposits. Leases The Company is committed to making rental payments under noncancelable operating leases covering various facilities and equipment. Future minimum lease payments required under noncancelable operating leases as of December 31, 2017 are as follows: Year Amount 2018 $ 163 2019 142 2020 116 2021 91 2022 72 Thereafter 196 Total $ 780 Capital lease obligations were $29 million , net of $2 million of imputed interest, at December 31, 2017 and $27 million , net of $2 million of imputed interest, at December 31, 2016 . The Company incurred rent expense of $192 million , $186 million and $179 million for the years ended December 31, 2017 , 2016 and 2015 , respectively. Purchase Commitments and Minimum Licensing Fees In the normal course of business, the Company makes various commitments to purchase goods or services from specific suppliers, including those related to capital expenditures. The purchase commitments made by the Company as of December 31, 2017 are approximately $94 million . The Company is required to pay a minimum licensing fee to Sotheby’s which began in 2009 and continues through 2054. The annual minimum licensing fee is approximately $2 million per year. The Company is also required to pay a minimum licensing fee to Meredith Corporation for the licensing of the Better Homes and Gardens Real Estate brand. The annual minimum licensing fee began in 2009 at $0.5 million and increased to $4 million in 2014, where it will generally remain through 2058. Future minimum payments for these purchase commitments and minimum licensing fees as of December 31, 2017 are as follows: Year Amount 2018 $ 57 2019 23 2020 15 2021 13 2022 18 Thereafter 222 Total $ 348 Standard Guarantees/Indemnifications In the ordinary course of business, the Company enters into numerous agreements that contain standard guarantees and indemnities whereby the Company indemnifies another party for breaches of representations and warranties. In addition, many of these parties are also indemnified against any third-party claim resulting from the transaction that is contemplated in the underlying agreement. Such guarantees or indemnifications are granted under various agreements, including those governing: (i) purchases, sales or outsourcing of assets or businesses, (ii) leases and sales of real estate, (iii) licensing of trademarks, (iv) use of derivatives, and (v) issuances of debt securities. The guarantees or indemnifications issued are for the benefit of the: (i) buyers in sale agreements and sellers in purchase agreements, (ii) landlords in lease contracts, (iii) franchisees in licensing agreements, (iv) financial institutions in derivative contracts, and (v) underwriters in issuances of securities. While some of these guarantees extend only for the duration of the underlying agreement, many survive the expiration of the term of the agreement or extend into perpetuity (unless subject to a legal statute of limitations). There are no specific limitations on the maximum potential amount of future payments that the Company could be required to make under these guarantees, nor is the Company able to develop an estimate of the maximum potential amount of future payments to be made under these guarantees as the triggering events are not subject to predictability. With respect to certain of the aforementioned guarantees, such as indemnifications of landlords against third-party claims for the use of real estate property leased by the Company, the Company maintains insurance coverage that mitigates any potential payments to be made. Other Guarantees/Indemnifications In the normal course of business, the Company coordinates numerous events for its franchisees and thus reserves a number of venues with certain minimum guarantees, such as room rentals at hotels local to the conference center. However, such room rentals are paid by each individual franchisee. If the franchisees do not meet the minimum guarantees, the Company is obligated to fulfill the minimum guaranteed fees. The maximum potential amount of future payments that the Company would be required to make under such guarantees is approximately $7 million . The Company would only be required to pay this maximum amount if none of the franchisees conducted their planned events at the reserved venues. Historically, the Company has not been required to make material payments under these guarantees. Insurance and Self-Insurance At December 31, 2017 and 2016 , the Consolidated Balance Sheets include approximately $40 million and $31 million , respectively, of liabilities relating to: (i) self-insured risks for errors and omissions and other legal matters incurred in the ordinary course of business within the Company Owned Real Estate Brokerage Services segment, (ii) vacant dwellings and household goods in transit and storage within the Relocation Services segment, and (iii) premium and claim reserves for the Company’s title underwriting business. The Company may also be subject to legal claims arising from the handling of escrow transactions and closings. The Company’s subsidiary, NRT, carries errors and omissions insurance for errors made during the real estate settlement process of $15 million in the aggregate, subject to a deductible of $1 million per occurrence. In addition, the Company carries an additional errors and omissions insurance policy for Realogy Holdings Corp. and its subsidiaries for errors made for real estate related services up to $35 million in the aggregate, subject to a deductible of $2.5 million per occurrence. This policy also provides excess coverage to NRT creating an aggregate limit of $50 million , subject to the NRT deductible of $1 million per occurrence. The Company issues title insurance policies which provide coverage for real property mortgage lenders and buyers of real property. When acting as a title agent issuing a policy on behalf of an underwriter, assuming no negligence on part of the title agent, the Company is not liable for losses under those policies but rather the title insurer is typically liable for such losses. The title underwriter which the Company acquired in January 2006 typically underwrites title insurance policies of up to $1.5 million . For policies in excess of $1.5 million , the Company typically obtains a reinsurance policy from a national underwriter to reinsure the excess amount. The Company, as an underwriter, manages our claims losses through strict agent vetting, clear underwriting guidelines, training and frequent communications with our agents. Fraud, defalcation and misconduct by employees are also risks inherent in the business. The Company is the custodian of cash deposited by customers with specific instructions as to its disbursement from escrow, trust and account servicing files. The Company maintains Fidelity insurance covering the loss or theft of funds of up to $30 million per occurrence, subject to a deductible of $750 thousand per occurrence. The Company also maintains self-insurance arrangements relating to health and welfare, workers’ compensation, auto and general liability in addition to other benefits provided to the Company’s employees. The accruals for these self-insurance arrangements totaled approximately $16 million and $21 million at December 31, 2017 and 2016 , respectively. |
Note 14. Equity (Deficit) Equit
Note 14. Equity (Deficit) Equity (Deficit) (Notes) | 12 Months Ended |
Dec. 31, 2017 | |
Equity [Abstract] | |
Stockholders' Equity Note Disclosure [Text Block] | EQUITY Changes in Accumulated Other Comprehensive Loss The components of accumulated other comprehensive losses are as follows: Currency Translation Adjustments (1) Minimum Pension Liability Adjustment Accumulated Other Comprehensive Loss (2) Balance at January 1, 2015 $ — $ (35 ) $ (35 ) Other comprehensive income (loss) before reclassifications (4 ) 1 (3 ) Amounts reclassified from accumulated other comprehensive income — 2 (3) 2 Income tax (expense) benefit 1 (1 ) — Current period change (3 ) 2 (1 ) Balance at December 31, 2015 (3 ) (33 ) (36 ) Other comprehensive loss before reclassifications (5 ) (3 ) (8 ) Amounts reclassified from accumulated other comprehensive income — 1 (3) 1 Income tax benefit 2 1 3 Current period change (3 ) (1 ) (4 ) Balance at December 31, 2016 (6 ) (34 ) (40 ) Other comprehensive income (loss) before reclassifications 3 (1 ) 2 Amounts reclassified from accumulated other comprehensive income — 2 (3) 2 Income tax expense (1 ) — (1 ) Current period change 2 1 3 Balance at December 31, 2017 $ (4 ) $ (33 ) $ (37 ) _______________ (1) Assets and liabilities of foreign subsidiaries having non-U.S. dollar functional currencies are translated at exchange rates at the balance sheet dates and equity accounts are translated at historical spot rates. Revenues and expenses are translated at average exchange rates during the periods presented. The gains or losses resulting from translating foreign currency financial statements into U.S. dollars are included in accumulated other comprehensive income (loss). Gains or losses resulting from foreign currency transactions are included in the Consolidated Statements of Operations. (2) As of December 31, 2017 , the Company does not have any after-tax components of accumulated other comprehensive loss attributable to noncontrolling interests. (3) These amounts represent the amortization of actuarial loss to periodic pension cost and were reclassified from accumulated other comprehensive income to the general and administrative expenses line on the statement of operations. Dividend Policy In August 2016, the Company’s Board of Directors approved the initiation of a quarterly cash dividend policy of $0.09 per share on its common stock. The Board declared and paid a quarterly cash dividend of $0.09 per share of the Company's common stock during each quarter of 2017, returning $49 million to stockholders. The declaration and payment of any future dividend will be subject to the discretion of the Board of Directors and will depend on a variety of factors, including the Company’s financial condition and results of operations, contractual restrictions, including restrictive covenants contained in the Company’s credit agreements, and the indentures governing the Company’s outstanding debt securities, capital requirements and other factors that the Board of Directors deems relevant. Pursuant to the Company’s policy, the dividends payable in cash are treated as a reduction of additional paid-in capital since the Company is currently in an accumulated deficit position. Realogy Group Statements of Equity for the years ended December 31, 2017 , 2016 and 2015 Total equity for Realogy Group equals that of Realogy Holdings, but the components, common stock and additional paid-in capital are different. The table below presents information regarding the balances and changes in common stock and additional paid-in capital of Realogy Group for each of the three years ended December 31, 2017 , 2016 and 2015 . Realogy Group Stockholder’s Equity Common Stock Additional Paid-In Capital Accumulated Deficit Accumulated Other Comprehensive Loss Non- controlling Interests Total Equity Shares Amount Balance at January 1, 2015 — $ — $ 5,678 $ (3,464 ) $ (35 ) $ 4 $ 2,183 Net income — — — 184 — 4 188 Other comprehensive loss — — — — (1 ) — (1 ) Contributions from Realogy Holdings — — 5 — — — 5 Stock-based compensation — — 51 — — — 51 Dividends — — — — — (4 ) (4 ) Balance at December 31, 2015 — $ — $ 5,734 $ (3,280 ) $ (36 ) $ 4 $ 2,422 Cumulative effect of adoption of new accounting pronouncements related to stock-based compensation — — — 5 — — 5 Net income — — — 213 — 4 217 Other comprehensive loss — — — — (4 ) — (4 ) Repurchase of Common Stock — — (195 ) — — — (195 ) Contributions from Realogy Holdings — — 2 — — — 2 Stock-based compensation — — 51 — — — 51 Dividends — — (26 ) — — (3 ) (29 ) Balance at December 31, 2016 — $ — $ 5,566 $ (3,062 ) $ (40 ) $ 5 $ 2,469 Net income — — — 431 — 3 434 Other comprehensive income — — — — 3 — 3 Repurchase of Common Stock — — (280 ) — — — (280 ) Contributions from Realogy Holdings — — 8 — — — 8 Stock-based compensation — — 41 — — — 41 Dividends — — (49 ) — — (4 ) (53 ) Balance at December 31, 2017 — $ — $ 5,286 $ (2,631 ) $ (37 ) $ 4 $ 2,622 |
Earnings (Loss) Per Share (Note
Earnings (Loss) Per Share (Notes) | 12 Months Ended |
Dec. 31, 2017 | |
Earnings Per Share [Abstract] | |
Earnings Per Share [Text Block] | EARNINGS PER SHARE Earnings per share attributable to Realogy Holdings Basic earnings per share is computed based on net income attributable to Realogy Holdings stockholders divided by the basic weighted-average shares outstanding during the period. Dilutive earnings per share is computed consistently with the basic computation while giving effect to all dilutive potential common shares and common share equivalents that were outstanding during the period. Realogy Holdings uses the treasury stock method to reflect the potential dilutive effect of unvested stock awards and unexercised options. The following table sets forth the computation of basic and diluted earnings per share: Year Ended December 31, (in millions, except per share data) 2017 2016 2015 Net income attributable to Realogy Holdings shareholders $ 431 $ 213 $ 184 Basic weighted average shares 136.7 144.5 146.5 Stock options, restricted stock, restricted stock units and performance share units (a) 1.7 1.3 1.6 Weighted average diluted shares 138.4 145.8 148.1 Earnings Per Share: Basic $ 3.15 $ 1.47 $ 1.26 Diluted $ 3.11 $ 1.46 $ 1.24 _______________ (a) Excludes 5.3 million , 4.5 million and 3.5 million shares of common stock issuable for incentive equity awards, including performance share units based on the achievement of target amounts, for the years ended December 31, 2017 , 2016 and 2015 , respectively, which are anti-dilutive to the diluted earnings per share computation. Under the 2016 and 2017 share repurchase programs, the Company's Board of Directors authorized up to $575 million of the Company’s common stock. For the year ended December 31, 2017 , the Company repurchased and retired 9.4 million shares of common stock for $276 million at a weighted average market price of $29.38 per share. For the year ended December 31, 2016 , the Company repurchased and retired 7.1 million shares of common stock for $199 million at a weighted average market price of $27.96 per share, which includes 0.2 million shares for which the trade date occurred in late December 2016 while settlement occurred in January 2017. The purchase of shares under these plans reduce the weighted-average number of shares outstanding in the basic earnings per share calculation. |
Risk Management and Fair Value
Risk Management and Fair Value of Financial Instruments (Notes) | 12 Months Ended |
Dec. 31, 2017 | |
Risk Management and Fair Value of Financial Instruments [Abstract] | |
Risk Management and Fair Value of Financial Instruments | RISK MANAGEMENT AND FAIR VALUE OF FINANCIAL INSTRUMENTS RISK MANAGEMENT The following is a description of the Company’s risk management policies. Interest Rate Risk The Company is exposed to market risk from changes in interest rates primarily through senior secured debt. At December 31, 2017 , the Company's primary interest rate exposure was to interest rate fluctuations, specifically LIBOR, due to its impact on variable rate borrowings of Revolving Credit Facility and Term Loan B under the Senior Secured Credit Agreement and Term Loan A Facility. Given that borrowings under the Senior Secured Credit Agreement and Term Loan A Facility are generally based upon LIBOR, this rate will be the Company's primary market risk exposure for the foreseeable future. At December 31, 2017 , the Company had variable interest rate long-term debt, which was based on LIBOR, from the outstanding term loans and revolver under its Senior Secured Credit Facility and Term Loan A Facility of $1,886 million , excluding $194 million of securitization obligations. The Company has interest rate swaps with an aggregate notional value of $1,475 million to manage a portion of the Company's exposure to changes in interest rate associated with variable rate borrowings. The fixed interest rates on the swaps range from 2.07% to 2.89% . Although we have entered into these interest rate swaps, involving the exchange of floating for fixed rate interest payments, such interest rate swaps do not eliminate interest rate volatility for all of our variable rate indebtedness at December 31, 2017 . In addition, the fair value of the interest rate swaps is also subject to movements in LIBOR and will fluctuate in future periods. The Company has recognized a liability of $13 million for the fair value of the interest rate swaps at December 31, 2017 . Therefore, an increase in the LIBOR yield curve could increase the fair value of the interest rate swaps and decrease interest expense. In the normal course of business, the Company borrows funds under its securitization facilities and utilizes such funds to generate assets on which it generally earns interest income. The Company does not believe it is exposed to significant interest rate risk in connection with these activities as the rate it incurs on such borrowings and the rate it earns on such assets are generally based on similar variable indices, thereby providing a natural hedge. Credit Risk and Exposure The Company is exposed to counterparty credit risk in the event of nonperformance by counterparties to various agreements and sales transactions. The Company manages such risk by evaluating the financial position and creditworthiness of such counterparties and by requiring collateral in instances in which financing is provided. The Company mitigates counterparty credit risk associated with its derivative contracts by monitoring the amounts at risk with each counterparty to such contracts, periodically evaluating counterparty creditworthiness and financial position, and where possible, dispersing its risk among multiple counterparties. As of December 31, 2017 , there were no significant concentrations of credit risk with any individual counterparty or a group of counterparties. The Company actively monitors the credit risk associated with the Company’s receivables. Market Risk Exposure The Company Owned Real Estate Brokerage Services segment, NRT, owns real estate brokerage offices located in and around large metropolitan areas in the U.S. NRT has more offices and realizes more of its revenues in California, Florida and the New York metropolitan area than any other regions of the country. For the year ended December 31, 2017 , NRT generated approximately 27% of its revenues from California, 22% from the New York metropolitan area and 9% from Florida. For the year ended December 31, 2016 , NRT generated approximately 26% of its revenues from California, 22% from the New York metropolitan area and 9% from Florida. For the year ended December 31, 2015 , NRT generated approximately 27% of its revenues from California, 23% from the New York metropolitan area and 10% from Florida. Derivative Instruments The Company records derivatives and hedging activities on the balance sheet at their respective fair values. The Company uses foreign currency forward contracts largely to manage its exposure to changes in foreign currency exchange rates associated with its foreign currency denominated receivables and payables. The Company primarily manages its foreign currency exposure to the Euro, British Pound, Swiss Franc and Canadian Dollar. The Company has not elected to utilize hedge accounting for these forward contracts; therefore, any change in fair value is recorded in the Consolidated Statements of Operations. However, the fluctuations in the value of these forward contracts generally offset the impact of changes in the value of the underlying risk that they are intended to economically hedge. As of December 31, 2017 , the Company had outstanding foreign currency forward contracts in a liability position with a fair value of less than $1 million and a notional value of $25 million . As of December 31, 2016 , the Company had outstanding foreign currency forward contracts in a liability position with a fair value of $2 million and a notional value of $29 million . The Company also enters into interest rate swaps to manage its exposure to changes in interest rates associated with its variable rate borrowings. At December 31, 2017 , the Company has interest rate swaps with an aggregate notional value of $1,475 million to offset the variability in cash flows resulting from the term loan facilities as follows: Notional Value (in millions) Commencement Date Expiration Date $225 July 2012 February 2018 (a) $200 January 2013 February 2018 (a) $600 August 2015 August 2020 $450 November 2017 (a) November 2022 _______________ (a) Interest rates swaps with a notional value of $425 million expired February 10, 2018, and interest rate swaps with a notional value of $450 million commenced in the fourth quarter of 2017. The swaps help to protect our outstanding variable rate borrowings from future interest rate volatility. The Company has not elected to utilize hedge accounting for these interest rate swaps; therefore, any change in fair value is recorded in the Consolidated Statements of Operations. The fair value of derivative instruments was as follows: Liability Derivatives Fair Value Not Designated as Hedging Instruments Balance Sheet Location December 31, 2017 December 31, 2016 Interest rate swap contracts Other current and non-current liabilities $ 13 $ 33 The effect of derivative instruments on earnings was as follows: Derivative Instruments Not Designated as Hedging Instruments Location of (Gain) or Loss Recognized for Derivative Instruments (Gain) or Loss Recognized on Derivatives Year Ended December 31, 2017 2016 2015 Interest rate swap contracts Interest expense $ (4 ) $ 6 $ 20 Foreign exchange contracts Operating expense 2 (2 ) (2 ) Fair Value Measurements The following tables present the Company’s assets and liabilities that are measured at fair value on a recurring basis and are categorized using the fair value hierarchy. The fair value hierarchy has three levels based on the reliability of the inputs used to determine fair value. Level Input: Input Definitions: Level I Inputs are unadjusted, quoted prices for identical assets or liabilities in active markets at the measurement date. Level II Inputs other than quoted prices included in Level I that are observable for the asset or liability through corroboration with market data at the measurement date. Level III Unobservable inputs that reflect management’s best estimate of what market participants would use in pricing the asset or liability at the measurement date. The availability of observable inputs can vary from asset to asset and is affected by a wide variety of factors including, for example, the type of asset, whether the asset is new and not yet established in the marketplace, and other characteristics particular to the transaction. To the extent that valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment. Accordingly, the degree of judgment exercised by the Company in determining fair value is greatest for instruments categorized in Level III. In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes, the level in the fair value hierarchy within which the fair value measurement in its entirety falls is determined based on the lowest level input that is significant to the fair value measurement in its entirety. The fair value of financial instruments is generally determined by reference to quoted market values. In cases where quoted market prices are not available, fair value is based on estimates using present value or other valuation techniques, as appropriate. The fair value of interest rate swaps is determined based upon a discounted cash flow approach. The Company measures financial instruments at fair value on a recurring basis and recognizes transfers within the fair value hierarchy at the end of the fiscal quarter in which the change in circumstances that caused the transfer occurred. The following table summarizes fair value measurements by level at December 31, 2017 for assets and liabilities measured at fair value on a recurring basis: Level I Level II Level III Total Interest rate swaps (included in other current and non-current liabilities) $ — $ 13 $ — $ 13 Deferred compensation plan assets (included in other non-current assets) 3 — — 3 Contingent consideration for acquisitions (included in accrued expenses and other current liabilities and non-current liabilities) — — 34 34 The following table summarizes fair value measurements by level at December 31, 2016 for assets and liabilities measured at fair value on a recurring basis: Level I Level II Level III Total Interest rate swaps (included in other non-current liabilities) $ — $ 33 $ — $ 33 Deferred compensation plan assets (included in other non-current assets) 3 — — 3 Contingent consideration for acquisitions (included in accrued expenses and other current liabilities and non-current liabilities) — — 50 50 The fair value of the Company’s contingent consideration for acquisitions is measured using a probability weighted-average discount rate to estimate future cash flows based upon the likelihood of achieving future operating results for individual acquisitions. These assumptions are deemed to be unobservable inputs and as such the Company’s contingent consideration is classified within Level III of the valuation hierarchy. The Company reassesses the fair value of the contingent consideration liabilities on a quarterly basis. The following table presents changes in Level III financial liabilities measured at fair value on a recurring basis: Level III Fair value of contingent consideration at December 31, 2016 $ 50 Additions: contingent consideration related to acquisitions completed during the period 7 Reductions: payments of contingent consideration (22 ) Changes in fair value (reflected in the Consolidated Statement of Operations) (1 ) Fair value of contingent consideration at December 31, 2017 $ 34 The following table summarizes the principal amount of the Company’s indebtedness compared to the estimated fair value, primarily determined by quoted market values, at: December 31, 2017 December 31, 2016 Debt Principal Amount Estimated Fair Value (a) Principal Amount Estimated Fair Value (a) Senior Secured Credit Facility: Revolving Credit Facility $ 70 $ 70 $ 200 $ 200 Term Loan B 1,083 1,085 1,094 1,100 Term Loan A Facility: Term Loan A 391 393 413 414 Term Loan A-1 342 343 351 351 4.50% Senior Notes 450 457 450 461 5.25% Senior Notes 550 569 550 562 4.875% Senior Notes 500 495 500 483 Securitization obligations 194 194 205 205 _______________ (a) The fair value of the Company's indebtedness is categorized as Level II. |
Segment Information (Notes)
Segment Information (Notes) | 12 Months Ended |
Dec. 31, 2017 | |
Segment Reporting [Abstract] | |
Segment Information | SEGMENT INFORMATION The reportable segments presented below represent the Company’s operating segments for which separate financial information is available and which is utilized on a regular basis by its chief operating decision maker to assess performance and to allocate resources. In identifying its reportable segments, the Company also considers the nature of services provided by its operating segments. Management evaluates the operating results of each of its reportable segments based upon revenue and EBITDA, which is defined as net income (loss) before depreciation and amortization, interest (income) expense, net (other than Relocation Services interest for relocation receivables and securitization obligations) and income taxes, each of which is presented in the Company’s Consolidated Statements of Operations. The Company’s presentation of EBITDA may not be comparable to similar measures used by other companies. Revenues (a) (b) Year Ended December 31, 2017 2016 2015 Real Estate Franchise Services $ 830 $ 781 $ 755 Company Owned Real Estate Brokerage Services 4,643 4,344 4,344 Relocation Services 382 405 415 Title and Settlement Services 570 573 487 Corporate and Other (c) (311 ) (293 ) (295 ) Total Company $ 6,114 $ 5,810 $ 5,706 _______________ (a) Transactions between segments are eliminated in consolidation. Revenues for the Real Estate Franchise Services segment include intercompany royalties and marketing fees paid by the Company Owned Real Estate Brokerage Services segment of $311 million , $293 million and $295 million for the years ended December 31, 2017 , 2016 and 2015 , respectively. Such amounts are eliminated through the Corporate and Other line. (b) Revenues for the Relocation Services segment include intercompany referral commissions paid by the Company Owned Real Estate Brokerage Services segment of $40 million , $43 million and $49 million for the years ended December 31, 2017 , 2016 and 2015 , respectively. Such amounts are recorded as contra-revenues by the Company Owned Real Estate Brokerage Services segment. There are no other material intersegment transactions. (c) Includes the elimination of transactions between segments. EBITDA Year Ended December 31, 2017 (a) 2016 (b) 2015 (c) Real Estate Franchise Services $ 559 $ 516 $ 495 Company Owned Real Estate Brokerage Services 126 137 199 Relocation Services 85 96 105 Title and Settlement Services 58 62 48 Corporate and Other (d) (103 ) (78 ) (121 ) Total Company $ 725 $ 733 $ 726 ______________ (a) For the year ended December 31, 2017 , the Real Estate Franchise Services segment includes restructuring charges of $1 million ; the Company Owned Real Estate Brokerage Services segment includes restructuring charges of $9 million ; the Title and Settlement Services segment includes restructuring charges of $1 million ; and Corporate and Other includes an $8 million expense related to the settlement of the Strader legal matter, an $8 million expense related to the transition of the Company's CEO, $5 million related to the losses on the early extinguishment of debt and restructuring charges of $1 million , partially offset by a net benefit of $10 million of former parent legacy items. (b) For the year ended December 31, 2016 , the Real Estate Franchise Services segment includes restructuring charges of $4 million ; the Company Owned Real Estate Brokerage Services segment includes restructuring charges of $22 million ; the Relocation Services segment includes restructuring charges of $4 million ; the Title and Settlement Services segment includes restructuring charges of $1 million ; and Corporate and Other includes restructuring charges of $8 million , partially offset by a net benefit of $2 million of former parent legacy items. (c) For the year ended December 31, 2015 , the Company Owned Real Estate Brokerage Services segment includes restructuring charges of $5 million ; the Relocation Services segment includes restructuring charges of $1 million ; and Corporate and Other includes $48 million related to the loss on the early extinguishment of debt and restructuring charges of $4 million , partially offset by a net benefit of $15 million of former parent legacy items. (d) Includes the elimination of transactions between segments. Provided below is a reconciliation of EBITDA to Net income attributable to Realogy Holdings and Realogy Group: Year Ended December 31, 2017 2016 2015 Net income attributable to Realogy Holdings and Realogy Group $ 431 $ 213 $ 184 Add: Depreciation and amortization (a) 201 202 201 Interest expense, net 158 174 231 Income tax (benefit) expense (65 ) 144 110 EBITDA $ 725 $ 733 $ 726 _______________ (a) Depreciation and amortization for the year ended December 31, 2017 includes $3 million of amortization expense related to Guaranteed Rate Affinity's purchase accounting included in the "Equity in earnings of unconsolidated entities" line on the Consolidated Statement of Operations. Depreciation and Amortization Year Ended December 31, 2017 2016 2015 Real Estate Franchise Services $ 79 $ 77 $ 77 Company Owned Real Estate Brokerage Services 50 49 46 Relocation Services 33 31 33 Title and Settlement Services 16 23 25 Corporate and Other 20 22 20 Total Company $ 198 $ 202 $ 201 Segment Assets As of December 31, 2017 2016 Real Estate Franchise Services $ 4,413 $ 4,477 Company Owned Real Estate Brokerage Services 1,258 1,249 Relocation Services 1,029 1,081 Title and Settlement Services 486 416 Corporate and Other 151 198 Total Company $ 7,337 $ 7,421 Capital Expenditures Year Ended December 31, 2017 2016 2015 Real Estate Franchise Services $ 9 $ 8 $ 8 Company Owned Real Estate Brokerage Services 44 44 41 Relocation Services 11 12 14 Title and Settlement Services 13 9 8 Corporate and Other 22 14 13 Total Company $ 99 $ 87 $ 84 The geographic segment information provided below is classified based on the geographic location of the Company’s subsidiaries. United States All Other Countries Total On or for the year ended December 31, 2017 Net revenues $ 5,997 $ 117 $ 6,114 Total assets 7,261 76 7,337 Net property and equipment 287 2 289 On or for the year ended December 31, 2016 Net revenues $ 5,683 $ 127 $ 5,810 Total assets 7,347 74 7,421 Net property and equipment 265 2 267 On or for the year ended December 31, 2015 Net revenues $ 5,579 $ 127 $ 5,706 Total assets 7,450 81 7,531 Net property and equipment 252 2 254 |
Selected Quarterly Financial Da
Selected Quarterly Financial Data (Unaudited) (Notes) | 12 Months Ended |
Dec. 31, 2017 | |
Quarterly Financial Information Disclosure [Abstract] | |
Selected Quarterly Financial Data (Unaudited) | SELECTED QUARTERLY FINANCIAL DATA (UNAUDITED) Provided below is selected unaudited quarterly financial data for 2017 and 2016 . 2017 First Second Third Fourth Net revenues Real Estate Franchise Services $ 170 $ 237 $ 224 $ 199 Company Owned Real Estate Brokerage Services 897 1,392 1,267 1,087 Relocation Services 77 102 111 92 Title and Settlement Services 120 157 154 139 Corporate and Other (a) (61 ) (95 ) (82 ) (73 ) Total Company $ 1,203 $ 1,793 $ 1,674 $ 1,444 Income (loss) before income taxes, equity in earnings and noncontrolling interests (b) Real Estate Franchise Services $ 82 $ 146 $ 139 $ 113 Company Owned Real Estate Brokerage Services (35 ) 65 36 (14 ) Relocation Services (5 ) 21 32 15 Title and Settlement Services (3 ) 23 19 6 Corporate and Other (73 ) (72 ) (73 ) (71 ) Total Company $ (34 ) $ 183 $ 153 $ 49 Net income (loss) attributable to Realogy Holdings and Realogy Group $ (28 ) $ 109 $ 95 $ 255 Income (loss) per share attributable to Realogy Holdings (c) : Basic income (loss) per share $ (0.20 ) $ 0.79 $ 0.70 $ 1.91 Diluted income (loss) per share $ (0.20 ) $ 0.78 $ 0.69 $ 1.89 _______________ (a) Represents the elimination of transactions primarily between the Real Estate Franchise Services segment and the Company Owned Real Estate Brokerage Services segment. (b) The quarterly results include the following: • an $8 million expense related to the settlement of the Strader legal matter in the second quarter; • restructuring charges of $5 million , $2 million , $2 million and $3 million in the first, second, third and fourth quarters, respectively; • former parent legacy net benefit of $11 million in the second quarter and former parent legacy net cost of $1 million in the third quarter; • a loss on the early extinguishment of debt of $4 million and $1 million in the first and third quarters, respectively; • mark-to-market adjustments for interest rate swaps of a $1 million gain , a $5 million loss , and an $8 million gain in the first, second and fourth quarters, respectively; and • an $8 million expense related to the transition of the Company's CEO in the fourth quarter. (c) Basic and diluted EPS amounts in each quarter are computed using the weighted-average number of shares outstanding during that quarter, while basic and diluted EPS for the full year is computed using the weighted-average number of shares outstanding during the year. Therefore, the sum of the four quarters’ basic or diluted EPS may not equal the full year basic or diluted EPS (see Note 15 "Earnings Per Share" for further information). 2016 First Second Third Fourth Net revenues Real Estate Franchise Services $ 157 $ 221 $ 215 $ 188 Company Owned Real Estate Brokerage Services 841 1,268 1,231 1,004 Relocation Services 83 109 116 97 Title and Settlement Services 111 149 164 149 Corporate and Other (a) (58 ) (85 ) (82 ) (68 ) Total Company $ 1,134 $ 1,662 $ 1,644 $ 1,370 Income (loss) before income taxes, equity in earnings and noncontrolling interests (b) Real Estate Franchise Services $ 73 $ 130 $ 133 $ 102 Company Owned Real Estate Brokerage Services (32 ) 63 55 (8 ) Relocation Services (1 ) 22 34 16 Title and Settlement Services (5 ) 21 17 6 Corporate and Other (101 ) (83 ) (63 ) (30 ) Total Company $ (66 ) $ 153 $ 176 $ 86 Net income (loss) attributable to Realogy Holdings and Realogy Group $ (42 ) $ 92 $ 106 $ 57 Income (loss) per share attributable to Realogy Holdings (c) : Basic income (loss) per share $ (0.29 ) $ 0.63 $ 0.74 $ 0.40 Diluted income (loss) per share $ (0.29 ) $ 0.63 $ 0.73 $ 0.40 _______________ (a) Represents the elimination of transactions primarily between the Real Estate Franchise Services segment and the Company Owned Real Estate Brokerage Services segment. (b) The quarterly results include the following: • former parent legacy net cost of $1 million in the first quarter and former parent legacy net benefit of $3 million in the fourth quarter; • restructuring charges of $9 million , $12 million , $9 million and $9 million in the first, second, third and fourth quarters, respectively; and • mark-to-market adjustments for interest rate swaps of a $31 million loss , a $14 million loss , a $5 million gain , and a $34 million gain in the first, second, third and fourth quarters, respectively. (c) Basic and diluted EPS amounts in each quarter are computed using the weighted-average number of shares outstanding during that quarter, while basic and diluted EPS for the full year is computed using the weighted-average number of shares outstanding during the year. Therefore, the sum of the four quarters’ basic or diluted EPS may not equal the full year basic or diluted EPS. |
Note 19. Subsequent Events Subs
Note 19. Subsequent Events Subsequent Events (Notes) | 12 Months Ended |
Dec. 31, 2017 | |
Subsequent Events [Abstract] | |
Subsequent Events [Text Block] | SUBSEQUENT EVENTS Refinancing In February 2018, the Company completed debt transactions which: • amended its revolving credit facility, by increasing the capacity from $1,050 million to $1,400 million and extending the maturity date from October 2020 to February 2023 (the "New Revolving Credit Facility"); • refinanced the existing aggregate $733 million Term Loan A and Term Loan A-1 tranches due October 2020 and July 2021 , respectively, into a new single tranche of $750 million Term Loan A due February 2023 (which included incremental borrowings of $17 million ) (the "New Term Loan A"). The New Term Loan A Facility provides for quarterly amortization payments on the last day of each quarter, totaling per annum 2.5% , 2.5% , 5.0% , 7.5% and 10.0% of the original principal amount of the New Term Loan A, commencing June 30, 2018, with the balance of the New Term Loan A due in full on February 8, 2023; and • refinanced the existing $1,083 million Term Loan B due July 2022 with a new Term Loan B issued at par in the amount of $1,080 million and with a maturity date in February 2025 (the "New Term Loan B"). The interest rates with respect to the New Revolving Credit Facility and the New Term Loan A are the same that had been in place under Term Loan A-1 and are based on, at the Company's option, adjusted LIBOR or ABR plus an additional margin subject to adjustments based on the Company’s then current senior secured leverage ratio. The interest rate and amortization with respect to New Term Loan B is unchanged. The other terms of the New Revolving Credit Facility, New Term Loan A and New Term Loan B are substantially the same as those in place prior to the transactions. Adoption of New Share Repurchase Program On February 26, 2018, the Board authorized a new share repurchase program of up to $350 million of the Company's common stock, which is in addition to the remaining authorization available under the February 2017 share repurchase program. Repurchases under the new program may be made at management's discretion from time to time on the open market, pursuant to Rule 10b5-1 trading plans or through privately negotiated transactions. The size and timing of these repurchases will depend on price, market and economic conditions, legal and contractual requirements and other factors. Similarly, the new repurchase program has no time limit and may be suspended or discontinued at any time. |
Note 2. Summary of Significan27
Note 2. Summary of Significant Accounting Policies Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2017 | |
Accounting Policies [Abstract] | |
Use of Estimates, Policy [Policy Text Block] | USE OF ESTIMATES In presenting the consolidated financial statements, management makes estimates and assumptions that affect the amounts reported and related disclosures. Estimates, by their nature, are based on judgment and available information. Accordingly, actual results could differ materially from those estimates. |
Revenue Recognition, Policy [Policy Text Block] | REVENUE RECOGNITION Real Estate Franchise Services The Company franchises its real estate brands to real estate brokerage businesses that are independently owned and operated. Franchise revenue principally consists of royalty and marketing fees from the Company’s franchisees. The royalty received is primarily based on a percentage of the franchisee’s gross commission income. Royalty fees are accrued as the underlying franchisee revenue is earned (upon close of the homesale transaction). Annual volume incentives given to certain franchisees on royalty fees are recorded as a reduction to revenue and are accrued for in relative proportion to the recognition of the underlying gross franchise revenue. Non-standard sales incentives are recorded as a reduction to revenue ratably over the related performance period or from the date of issuance through the remaining life of the related franchise agreement. Franchise revenue also includes initial franchise fees and initial area development fees, which are generally non-refundable and recognized by the Company as revenue when all material services or conditions relating to the sale have been substantially performed. The Company also earns marketing fees from its franchisees and utilizes such fees to fund marketing campaigns on behalf of its franchisees. As such, marketing revenue is earned as these funds are spent. Company Owned Real Estate Brokerage Services As an owner-operator of real estate brokerages, the Company assists home buyers and sellers in listing, marketing, selling and finding homes. Real estate commissions earned by the Company’s real estate brokerage business are recorded as revenue on a gross basis upon the closing of a real estate transaction (i.e., purchase or sale of a home), which are referred to as gross commission income. The commissions the Company pays to real estate agents are recognized concurrently with associated revenues and presented as the commission and other agent-related costs line item on the accompanying Consolidated Statements of Operations. Relocation Services The Company provides relocation services to corporate and government clients for the transfer of their employees ("transferees"). Such services include homesale assistance including the purchasing and/or selling of a transferee’s home and providing home equity advances to transferees (generally guaranteed by the individual's employer), arranging household goods moving services, and other relocation services such as expense processing, relocation policy counseling, relocation-related accounting, coordinating visa and immigration support, intercultural and language training and destination services. Clients may pay a bundled outsourcing management fee that can cover several of the relocation services listed, according the clients’ specific needs. In many cases, Cartus charges an outsourcing fee to the client that covers multiple relocation services that Cartus will deliver to the transferee. The Company earns revenues from fees charged to clients for the performance and/or facilitation of these services and recognizes such revenue as services are provided. In the majority of relocation transactions, the gain or loss on the sale of a transferee’s home is generally borne by the individual's employer. Furthermore, the Company recognizes household goods commission revenue for arranging household goods moving services on a net basis when the household goods reach the destination location. In addition, we provide home buying and selling assistance to members of Affinity organizations. The Company earns referral commission revenue primarily from real estate brokers for the home sale and purchase of transferees and Affinity members, which is recognized at the time the underlying property closes, and revenues from other third-party service providers where the Company earns a referral commission, which is recognized at the time of completion of services. Additionally, the Company generally earns interest income on the funds it advances on behalf of the transferring employee, which is recorded within other revenue (as is the corresponding interest expense on the securitization obligations) in the accompanying Consolidated Statements of Operations. Title and Settlement Services The Company provides title and closing services, which include title search procedures for title insurance policies, homesale escrow and other closing services. Title revenues, which are recorded net of amounts remitted to third-party insurance underwriters, and title and closing service fees are recorded at the time a homesale transaction or refinancing closes. The Company also owns an underwriter of title insurance. For independent title agents, the underwriter recognizes policy premium revenue on a gross basis (before deduction of agent commission) upon notice of policy issuance from the agent. For affiliated title agents, the underwriter recognizes the incremental policy premium revenue upon the effective date of the title policy as the agent commission revenue is already recognized by the affiliated title agent. |
Consolidation, Policy [Policy Text Block] | CONSOLIDATION The Company consolidates any VIE for which it is the primary beneficiary with a controlling financial interest. Also, the Company consolidates an entity not deemed a VIE if its ownership, direct or indirect, exceeds 50% of the outstanding voting shares of an entity and/or it has the ability to control the financial or operating policies through its voting rights, board representation or other similar rights. For entities where the Company does not have a controlling interest (financial or operating), the investments in such entities are accounted for using the equity method or at fair value with changes in fair value recognized in net income, as appropriate. The Company applies the equity method of accounting when it has the ability to exercise significant influence over operating and financial policies of an investee. The Company measures all other investments at fair value with changes in fair value recognized in net income or in the case that an equity investment does not have readily determinable fair values, at cost minus impairment (if any) plus or minus changes resulting from observable price changes in orderly transactions for the identical or a similar investment. |
Cash and Cash Equivalents, Policy [Policy Text Block] | CASH AND CASH EQUIVALENTS The Company considers highly liquid investments with remaining maturities not exceeding three months at the date of purchase to be cash equivalents. |
Cash and Cash Equivalents, Restricted Cash and Cash Equivalents, Policy [Policy Text Block] | RESTRICTED CASH Restricted cash primarily relates to amounts specifically designated as collateral for the repayment of outstanding borrowings under the Company’s securitization facilities. Such amounts approximated $7 million at both December 31, 2017 and 2016 . |
Receivables, Policy [Policy Text Block] | ALLOWANCE FOR DOUBTFUL ACCOUNTS The Company estimates the allowance necessary to provide for uncollectible accounts receivable. The estimate is based on historical experience, combined with a review of current developments and includes specific accounts for which payment has become unlikely. The process by which the Company calculates the allowance begins in the individual business units where specific problem accounts are identified and reserved primarily based upon the age profile of the receivables and specific payment issues. |
Advertising Costs, Policy [Policy Text Block] | ADVERTISING EXPENSES Advertising costs are generally expensed in the period incurred. Advertising expenses, recorded within the marketing expense line item on the Company’s Consolidated Statements of Operations, were approximately $211 million , $198 million and $194 million for the years ended December 31, 2017 , 2016 and 2015 , respectively. |
Deferred Charges, Policy [Policy Text Block] | DEBT ISSUANCE COSTS Debt issuance costs include costs incurred in connection with obtaining debt and extending existing debt. These financing costs are presented in the balance sheet as a direct deduction from the carrying value of the associated debt liability, consistent with the presentation of a debt discount, with the exception of the debt issuance costs related to the Revolving Credit Facility and securitization obligations which are classified as a deferred financing asset within other assets. The debt issuance costs are amortized via the effective interest method and the amortization period is the life of the related debt. |
Income Tax, Policy [Policy Text Block] | INCOME TAXES The Company’s provision for income taxes is determined using the asset and liability method, under which deferred tax assets and liabilities are calculated based upon the temporary differences between the financial statement and income tax bases of assets and liabilities using currently enacted tax rates. These differences are based upon estimated differences between the book and tax basis of the assets and liabilities for the Company. Certain tax assets and liabilities of the Company may be adjusted in connection with the finalization of income tax audits. The Company’s deferred tax assets are recorded net of a valuation allowance when, based on the weight of available evidence, it is more likely than not that all or some portion of the recorded deferred tax balances will not be realized in future periods. Decreases to the valuation allowance are recorded as reductions to the Company’s provision for income taxes and increases to the valuation allowance result in additional provision for income taxes. |
Derivatives, Policy [Policy Text Block] | DERIVATIVE INSTRUMENTS The Company records derivatives and hedging activities on the balance sheet at their respective fair values. The Company uses foreign currency forward contracts largely to manage its exposure to changes in foreign currency exchange rates associated with its foreign currency denominated receivables and payables. The Company primarily manages its foreign currency exposure to the Euro, British Pound, Swiss Franc and Canadian Dollar. The Company has not elected to utilize hedge accounting for these forward contracts; therefore, any change in fair value is recorded in the Consolidated Statements of Operations. However, the fluctuations in the value of these forward contracts generally offset the impact of changes in the value of the underlying risk that they are intended to economically hedge. The Company also enters into interest rate swaps to manage its exposure to changes in interest rates associated with its variable rate borrowings. At December 31, 2017 , the Company has interest rate swaps with an aggregate notional value of $1,475 million to offset the variability in cash flows resulting from the term loan facilities as follows: Notional Value (in millions) Commencement Date Expiration Date $225 July 2012 February 2018 (a) $200 January 2013 February 2018 (a) $600 August 2015 August 2020 $450 November 2017 (a) November 2022 _______________ (a) Interest rates swaps with a notional value of $425 million expired February 10, 2018, and interest rate swaps with a notional value of $450 million commenced in the fourth quarter of 2017. The swaps help to protect our outstanding variable rate borrowings from future interest rate volatility. The Company has not elected to utilize hedge accounting for these interest rate swaps; therefore, any change in fair value is recorded in the Consolidated Statements of Operations. |
Equity Method Investments [Policy Text Block] | INVESTMENTS The Company owned 49.9% of PHH Home Loans, a mortgage origination venture formed in 2005 for the purpose of originating and selling mortgage loans primarily sourced through the Company’s real estate brokerage and relocation businesses, while PHH Corporation ("PHH") owned the remaining percentage. In February 2017, Realogy announced that it and Guaranteed Rate, Inc. (“Guaranteed Rate”) agreed to form a new mortgage origination joint venture, Guaranteed Rate Affinity, LLC ("Guaranteed Rate Affinity"). During the third and fourth quarters of 2017, Guaranteed Rate Affinity, acquired certain assets of the mortgage operations of PHH Home Loans, including its four regional centers and employees across the United States, but not its mortgage assets. Guaranteed Rate Affinity began doing business in August 2017 on a phased-in basis. Guaranteed Rate Affinity originates and markets its mortgage lending services to the Company's real estate brokerage and relocation subsidiaries as well as other real estate brokerage companies across the country. Guaranteed Rate owns a controlling 50.1% stake of Guaranteed Rate Affinity and the Company owns 49.9% . The Company has certain governance rights related to the joint venture, however it does not have control of the day-to-day operations of Guaranteed Rate Affinity. While the equity earnings or losses related to PHH Home Loans were included in the financial results of the Company Owned Real Estate Brokerage Services segment, the equity earnings or losses related to Guaranteed Rate Affinity are included in the financial results of the Title and Settlement Services segment. At December 31, 2017 and 2016 , the Company had various equity method investments aggregating $74 million and $66 million , respectively, which are recorded within other current and non-current assets on the accompanying Consolidated Balance Sheets. The $74 million investment balance at December 31, 2017 included $48 million for the Company's investment in Guaranteed Rate Affinity and $19 million for the Company's investment in PHH Home Loans, which has ceased operations. The Company's remaining interest in PHH Home Loans is expected to be liquidated in the first half of 2018 and the Company expects to realize net cash proceeds of $19 million , reducing the investment balance to zero. The $66 million investment balance at December 31, 2016 included $59 million for the Company's investment in PHH Home Loans. For the year ended December 31, 2017 , the Company recorded equity earnings of $18 million which consisted of $35 million of earnings from the sale of PHH Home Loans' assets to Guaranteed Rate Affinity, partially offset by $7 million of exit costs and losses of $6 million from the continuing operations of PHH Home Loans. In addition, there was a $4 million loss from equity method investments at the Title and Settlement Services segment primarily related to costs associated with the start up of operations of Guaranteed Rate Affinity, including $3 million of amortization of intangible assets recorded in purchase accounting. For the years ended December 31, 2016 and 2015, the Company recorded equity earnings of $12 million and $16 million , respectively, which consisted of $8 million and $14 million , respectively, relating to its investment in PHH Home Loans. The Company received $60 million , $7 million and $10 million in cash dividends, primarily from PHH Home Loans, during the years ended December 31, 2017 , 2016 and 2015 , respectively. The Company invested $55 million of cash into Guaranteed Rate Affinity during the year ended December 31, 2017 . |
Property, Plant and Equipment, Policy [Policy Text Block] | PROPERTY AND EQUIPMENT Property and equipment (including leasehold improvements) are initially recorded at cost, net of accumulated depreciation and amortization. Depreciation, recorded as a component of depreciation and amortization on the Consolidated Statements of Operations, is computed utilizing the straight-line method over the estimated useful lives of the related assets. Amortization of leasehold improvements, also recorded as a component of depreciation and amortization, is computed utilizing the straight-line method over the estimated benefit period of the related assets or the lease term, if shorter. Useful lives are 30 years for buildings, up to 20 years for leasehold improvements, and from 3 to 7 years for furniture, fixtures and equipment. The Company capitalizes the costs of software developed for internal use which commences during the development phase of the project. The Company amortizes software developed or obtained for internal use on a straight-line basis, generally from 1 to 5 years, when such software is ready for use. The net carrying value of software developed or obtained for internal use was $86 million and $83 million at December 31, 2017 and 2016 , respectively. |
Impairment or Disposal of Long-Lived Assets, Including Intangible Assets, Policy [Policy Text Block] | IMPAIRMENT OF GOODWILL, INTANGIBLE ASSETS AND OTHER LONG-LIVED ASSETS Goodwill represents the excess of acquisition costs over the fair value of the net tangible assets and identifiable intangible assets acquired in a business combination. Indefinite-lived intangible assets primarily consist of trademarks acquired in business combinations. Goodwill and indefinite-lived assets are not amortized, but are subject to impairment testing. The aggregate carrying values of our goodwill and other indefinite-lived intangible assets were $3,710 million and $767 million , respectively, at December 31, 2017 and are subject to impairment testing annually as of October 1, or whenever events or changes in circumstances indicate that the carrying amount may not be fully recoverable. This testing compares carrying values to fair values and, when appropriate, the carrying value is reduced to fair value. In testing goodwill, the fair value of our reporting units is estimated utilizing a discounted cash flow approach utilizing long-term cash flow forecasts and our annual operating plans adjusted for terminal value assumptions. We determine the fair value of our reporting units utilizing our best estimate of future revenues, operating expenses, cash flows, market and general economic conditions as well as assumptions that we believe marketplace participants would utilize including discount rates, cost of capital, trademark royalty rates and long-term growth rates. The trademark royalty rate was determined by reviewing similar trademark agreements with third parties. Although we believe our assumptions are reasonable, actual results may vary significantly. These impairment tests involve the use of accounting estimates and assumptions, changes in which could materially impact our financial condition or operating performance if actual results differ from such estimates and assumptions. To address this uncertainty, we perform sensitivity analysis on key estimates and assumptions. Based upon the impairment analysis performed in the fourth quarter of 2017 , 2016 and 2015 , there was no impairment of goodwill or other indefinite-lived intangible assets for these years. Management evaluated the effect of lowering the estimated fair value for each of the reporting units by 10% and determined that no impairment of goodwill would have been recognized under this evaluation for 2017 , 2016 or 2015 . The Company evaluates the recoverability of its other long-lived assets, including amortizable intangible assets, if circumstances indicate an impairment may have occurred. This analysis is performed by comparing the respective carrying values of the assets to the current and expected future cash flows, on an undiscounted basis, to be generated from such assets. Property and equipment is evaluated separately within each business unit. If such analysis indicates that the carrying value of these assets is not recoverable, then the carrying value of such assets is reduced to fair value through a charge to the Company’s Consolidated Statements of Operations. There were no impairments relating to other long-lived assets, including amortizable intangible assets, during 2017 , 2016 or 2015 . |
Cash Flow, Supplemental Disclosures [Text Block] | SUPPLEMENTAL CASH FLOW INFORMATION Significant non-cash transactions in 2017 , 2016 and 2015 included $18 million , $14 million and $17 million , respectively, in capital lease additions, which resulted in non-cash additions to property and equipment, net and other non-current liabilities. |
Share-based Compensation, Option and Incentive Plans Policy [Policy Text Block] | STOCK-BASED COMPENSATION The Company grants stock-based awards to certain senior management, employees and directors including non-qualified stock options, restricted stock, restricted stock units and performance share units . The fair value of non-qualified stock options is estimated using the Black-Scholes option pricing model on the grant date and is recognized as expense over the service period based on the vesting requirements. The fair value of r estricted stock, restricted stock units and performance share units without a market condition is measured based on the closing price of the Company's common stock on the grant date and is recognized as expense over the service period of the award, or when requisite performance metrics or milestones are probable of being achieved . The fair value of awards with a market condition are estimated using the Monte Carlo simulation method and expense is recognized on a straight-line basis over the requisite service period of the award. The Company recognizes forfeitures as they occur. Determining the fair value of stock-based awards at the grant date requires considerable judgment, including estimating expected volatility and expected term, risk-free rate. |
New Accounting Pronouncements, Policy [Policy Text Block] | RECENTLY ADOPTED ACCOUNTING PRONOUNCEMENTS In August 2016, the FASB issued a new standard on classification of cash receipts and payments on the statement of cash flows intending to reduce diversity in practice on how certain transactions are classified. In addition, in November 2016, the FASB issued a new standard requiring that the statement of cash flows explain the change during the period in the total of cash, cash equivalents, and amounts generally described as restricted cash or restricted cash equivalents. The Company elected to early adopt these ASUs in the fourth quarter of 2017 using retrospective application at the beginning of the earliest comparative period presented in the year of adoption, January 1, 2015. Adoption of the new guidance resulted in the following key changes: • Contingent consideration for business acquisitions - Prior to adoption of the new guidance, the Company classified payments of contingent consideration for business acquisitions on a separate line in the financing section of its Consolidated Statement of Cash Flows. Under the new guidance, payments of contingent consideration are separated and classified as investing activities for payments made soon after the acquisition’s consummation date (three months or less), financing activities for payments made up to the original acquisition date amount of the contingent consideration liability and operating activities for payments made in excess of the original amount of the contingent consideration liability. • Debt prepayments or extinguishment - Prior to adoption of the new guidance, the Company classified cash paid for fees associated with the prepayment or extinguishment of debt in the operating section of its Consolidated Statement of Cash Flows as part of net income (loss), adding back only the non-cash portion as an adjustment to reconcile net income (loss) to net cash provided (used) by operating activities. Under the new guidance, all cash paid for fees associated with the prepayment or extinguishment of debt is classified as financing activities and the total of the cash and non-cash portions are added back in the operating section. • Restricted Cash - Prior to adoption of the new guidance, the Company presented the change in restricted cash as a separate line in the investing section of its Consolidated Statement of Cash Flows. Under the new guidance, restricted cash is presented with cash and cash equivalents on the Consolidated Statement of Cash Flows and the activity is now reflected in the total change in cash, cash equivalents and restricted cash. Additionally, for reconciliation purposes, the Company broke out restricted cash as a separate line on the Company’s Consolidated Balance Sheet. Adoption of the new guidance resulted in reclassifications between cash flow categories, but no net cash impact to its Consolidated Statement of Cash Flows. RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS The Company considers the applicability and impact of all Accounting Standards Updates. ASUs not listed below were assessed and determined to be either not applicable or are expected to have minimal impact on our consolidated financial position or results of operations. In February 2018, the FASB issued a new standard which permits companies to reclassify certain income tax effects resulting from the 2017 Tax Act, called "stranded tax effects", from accumulated other comprehensive income ("AOCI") to retained earnings. According to the new guidance, the reclassification amount should include the effect of the change in the U.S. federal corporate income tax rate on the gross deferred tax amounts and related valuation allowances, if any, at the date of enactment of the 2017 Tax Act related to items remaining in AOCI. The guidance is effective for all companies for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years. Early adoption is permitted, including adoption in any interim period for public companies who have not yet issued financial statements. The Company expects to adopt this standard in the first quarter of 2018 which is expected to result in a debit to AOCI and a credit to Retained Earnings/Accumulated Deficit of approximately $9 million . In February 2016, the FASB issued its new standard on leases which requires virtually all leases to be recognized on the balance sheet. Lessees will recognize a right-of-use asset and a lease liability for all leases (other than leases that meet the definition of a short-term lease). The liability will be equal to the present value of lease payments. The asset will be based on the liability, subject to adjustment, such as for initial direct costs. For income statement purposes, the FASB retained a dual model, requiring leases to be classified as either operating or finance leases. Operating leases will result in straight-line expense, similar to current operating leases, while finance leases will result in a front-loaded expense pattern, similar to current capital leases. Classification will be based on criteria that are largely similar to those applied in current lease accounting, but without explicit bright lines. The new standard is effective for annual periods beginning after December 15, 2018. Early adoption is permitted. The new leasing standard requires modified retrospective transition, which requires application of the new guidance at the beginning of the earliest comparative period presented in the year of adoption. In January 2018, the FASB issued a proposed ASU that would allow entities to elect a simplified transition approach which would require applying the provisions of the new guidance at the effective date (e.g., January 1, 2019) as opposed to the earliest period presented under the modified retrospective approach (January 1, 2017). While the Company is still evaluating the impact of the standard on its consolidated financial statements, it does expect that the right to use asset and lease liability recorded on its Consolidated Balance Sheets will be material. The Company currently discloses its future lease obligations in Note 13. "Commitments and Contingencies" . The Company is in the process of implementing a new lease management system which will be utilized to account for leases under the new guidance once adopted. In May 2014, the FASB issued a standard on revenue recognition that will impact most companies to some extent. The objective of the revenue standard is to provide a single, comprehensive revenue recognition model for all contracts with customers to improve comparability within industries, across industries, and across capital markets. The revenue standard contains principles that an entity will apply to determine the measurement of revenue and the timing of revenue recognition. The new standard permits for two alternative implementation methods, the use of either (1) full retrospective application to each prior reporting period presented or (2) modified retrospective application in which the cumulative effect of initially applying the revenue standard is recognized as an adjustment to the opening balance of retained earnings in the period of adoption. The Company will adopt the new standard in the first quarter of 2018 using the modified retrospective transition method. The Company has redrafted its revenue recognition accounting policies affected by the standard, assessed the redesign of internal controls, as well as evaluated the expanded disclosure requirements. After thorough review of the Company's revenue streams, the Company determined that the new standard will not have a material impact on financial results as the majority of the Company's revenue is recognized at a point in time, at the completion of a homesale transaction, which will not change under the new revenue recognition guidance. |
Note 2. Summary of Significan28
Note 2. Summary of Significant Accounting Policies Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Accounting Policies [Abstract] | |
Schedule of Derivative Instruments [Table Text Block] | the term loan facilities as follows: Notional Value (in millions) Commencement Date Expiration Date $225 July 2012 February 2018 (a) $200 January 2013 February 2018 (a) $600 August 2015 August 2020 $450 November 2017 (a) November 2022 _______________ (a) Interest rates swaps with a notional value of $425 million expired February 10, 2018, and interest rate swaps with a notional value of $450 million commenced in the fourth quarter of 2017. Notional Value (in millions) Commencement Date Expiration Date $225 July 2012 February 2018 (a) $200 January 2013 February 2018 (a) $600 August 2015 August 2020 $450 November 2017 (a) November 2022 _______________ (a) Interest rates swaps with a notional value of $425 million expired February 10, 2018, and interest rate swaps with a notional value of $450 million commenced in the fourth quarter of 2017. |
Note 4. Intangible Assets Int29
Note 4. Intangible Assets Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Goodwill [Table Text Block] | Goodwill by segment and changes in the carrying amount are as follows: Real Estate Franchise Services Company Owned Brokerage Services Relocation Services Title and Settlement Services Total Company Balance at January 1, 2015 $ 2,292 $ 747 $ 360 $ 78 $ 3,477 Goodwill acquired — 94 — 47 141 Balance at December 31, 2015 2,292 841 360 125 3,618 Goodwill acquired — 52 — 20 72 Balance at December 31, 2016 2,292 893 360 145 3,690 Goodwill acquired — 11 — 9 20 Balance at December 31, 2017 $ 2,292 $ 904 $ 360 $ 154 $ 3,710 Goodwill and accumulated impairment summary Gross goodwill $ 3,315 $ 1,062 $ 641 $ 478 $ 5,496 Accumulated impairment losses (a) (1,023 ) (158 ) (281 ) (324 ) (1,786 ) Balance at December 31, 2017 $ 2,292 $ 904 $ 360 $ 154 $ 3,710 _______________ (a) During the fourth quarter of 2008 and 2007 the Company recorded impairment charges, which reduced goodwill by $1,279 million and $507 million , respectively. No goodwill or unamortized intangible asset impairments have been recorded since 2008 |
Schedule of Finite-Lived and Indefinite-Lived Intangible Assets by Major Class [Table Text Block] | Intangible assets are as follows: As of December 31, 2017 As of December 31, 2016 Gross Carrying Amount Accumulated Amortization Net Carrying Amount Gross Carrying Amount Accumulated Amortization Net Carrying Amount Amortizable—Franchise agreements (a) $ 2,019 $ 725 $ 1,294 $ 2,019 $ 658 $ 1,361 Indefinite life—Trademarks (b) $ 749 $ 749 $ 748 $ 748 Other Intangibles Amortizable—License agreements (c) $ 45 $ 10 $ 35 $ 45 $ 9 $ 36 Amortizable—Customer relationships (d) 549 335 214 550 312 238 Indefinite life—Title plant shares (e) 18 18 18 18 Amortizable—Pendings and listings (f) 2 1 1 6 5 1 Amortizable—Other (g) 33 17 16 33 13 20 Total Other Intangibles $ 647 $ 363 $ 284 $ 652 $ 339 $ 313 _______________ (a) Generally amortized over a period of 30 years. (b) Primarily relates to the Century 21 ® , Coldwell Banker ® , ERA ® , Corcoran ® , Coldwell Banker Commercial ® and Cartus tradenames, which are expected to generate future cash flows for an indefinite period of time. (c) Relates to the Sotheby’s International Realty ® and Better Homes and Gardens ® Real Estate agreements which are being amortized over 50 years (the contractual term of the license agreements). (d) Relates to the customer relationships at the Relocation Services segment, the Title and Settlement Services segment, the Real Estate Franchise Services segment and our Company Owned Real Estate Brokerage Services segment. These relationships are being amortized over a period of 2 to 20 years. (e) Ownership in a title plant is required to transact title insurance in certain states. The Company expects to generate future cash flows for an indefinite period of time. (f) Generally amortized over a period of 5 months . (g) Consists of covenants not to compete which are amortized over their contract lives and other intangibles which are generally amortized over periods ranging from 5 to 10 years. |
Schedule of Finite-Lived Intangible Assets, Amortization Expense [Table Text Block] | Intangible asset amortization expense is as follows: For the Year Ended December 31, 2017 2016 2015 Franchise agreements $ 67 $ 67 $ 67 License agreements 1 1 1 Customer relationships 25 28 28 Pendings and listings 4 12 16 Other 5 5 5 Total $ 102 $ 113 $ 117 |
Note 5. Franchising and Marke30
Note 5. Franchising and Marketing Activities Franchising and Marketing Activities (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Franchising and Marketing Activities [Abstract] | |
Schedule of the Number of Franchised and Company Owned Outlets in Operation [Table Text Block] | The number of franchised and company owned offices in operation are as follows: (Unaudited) As of December 31, 2017 2016 2015 Franchised: Century 21 ® 7,973 7,330 6,897 ERA ® 2,298 2,347 2,355 Coldwell Banker ® 2,330 2,289 2,258 Coldwell Banker Commercial ® 180 180 163 Sotheby’s International Realty ® 905 836 794 Better Homes and Gardens ® Real Estate 353 332 304 Total Franchised 14,039 13,314 12,771 Company Owned: Coldwell Banker ® 707 708 708 Sotheby’s International Realty ® 41 41 41 Corcoran ® /Other 41 40 38 Total Company Owned 789 789 787 |
Schedule of the Changes in the Number of Franchised and Company Owned Outlets [Table Text Block] | The number of franchised and company owned offices (in the aggregate) changed as follows: (Unaudited) For the Year Ended December 31, 2017 2016 2015 Franchised: Beginning balance 13,314 12,771 12,769 Additions 1,137 847 445 Terminations (412 ) (304 ) (443 ) Ending balance 14,039 13,314 12,771 Company Owned: Beginning balance 789 787 727 Additions 20 38 74 Closures (20 ) (36 ) (14 ) Ending balance 789 789 787 |
Note 6. Property and Equipmen31
Note 6. Property and Equipment, Net Property and Equipment, Net (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | Property and equipment, net consisted of: December 31, 2017 2016 Furniture, fixtures and equipment $ 281 $ 254 Capitalized software 366 351 Building and leasehold improvements 265 235 Land 3 3 Gross property and equipment 915 843 Less: accumulated depreciation (626 ) (576 ) Property and equipment, net $ 289 $ 267 |
Note 7. Accrued Expenses And 32
Note 7. Accrued Expenses And Other Current Liabilities Accrued Expenses And Other Current Liabilities (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Payables and Accruals [Abstract] | |
Accrued expenses and other current liabilities | Accrued expenses and other current liabilities consisted of: December 31, 2017 2016 Accrued payroll and related employee costs $ 140 $ 138 Accrued volume incentives 41 40 Accrued commissions 38 31 Restructuring accruals 5 14 Deferred income 68 69 Accrued interest 13 13 Contingent consideration for acquisitions 26 24 Due to former parent 18 28 Other 129 106 Total accrued expenses and other current liabilities $ 478 $ 463 |
Note 8. Short And Long-Term D33
Note 8. Short And Long-Term Debt Short and Long-Term Debt (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Debt Disclosure [Abstract] | |
Schedule of Total Indebtedness | Total indebtedness is as follows: December 31, 2017 2016 Senior Secured Credit Facility: Revolving Credit Facility $ 70 $ 200 Term Loan B 1,063 1,069 Term Loan A Facility: Term Loan A 390 411 Term Loan A-1 339 347 4.50% Senior Notes 444 439 5.25% Senior Notes 546 545 4.875% Senior Notes 496 496 Total Short-Term & Long-Term Debt $ 3,348 $ 3,507 Securitization obligations: Apple Ridge Funding LLC $ 181 $ 192 Cartus Financing Limited 13 13 Total securitization obligations $ 194 $ 205 |
Schedule of Debt | As of December 31, 2017 , the Company’s borrowing arrangements were as follows: Interest Rate Expiration Date Principal Amount Unamortized Discount and Debt Issuance Costs Net Amount Senior Secured Credit Facility: Revolving Credit Facility (1) (2) October 2020 $ 70 $ * $ 70 Term Loan B (3) July 2022 1,083 20 1,063 Term Loan A Facility: Term Loan A (4) October 2020 391 1 390 Term Loan A-1 (5) July 2021 342 3 339 Senior Notes 4.50% April 2019 450 6 444 Senior Notes 5.25% December 2021 550 4 546 Senior Notes 4.875% June 2023 500 4 496 Securitization obligations: (6) Apple Ridge Funding LLC (7) June 2018 181 * 181 Cartus Financing Limited (8) August 2018 13 * 13 Total (9) $ 3,580 $ 38 $ 3,542 _______________ * The debt issuance costs related to our Revolving Credit Facility and securitization obligations are classified as a deferred financing asset within other assets. (1) As of December 31, 2017 , the Company had $1,050 million of borrowing capacity under its Revolving Credit Facility, leaving $980 million of available capacity. The Revolving Credit Facility expires in October 2020, but is classified on the balance sheet as current due to the revolving nature of the facility. On February 23, 2018 , the Company had $242 million in outstanding borrowings under the New Revolving Credit Facility, leaving $1,158 million of available capacity. See Note 19, "Subsequent Events" for a description of the February 2018 refinancing. (2) Interest rates with respect to revolving loans under the Senior Secured Credit Facility at December 31, 2017 were based on, at the Company's option, (a) adjusted LIBOR plus an additional margin or (b) ABR plus an additional margin, in each case subject to adjustment based on the then current senior secured leverage ratio. Based on the previous quarter senior secured leverage ratio, the LIBOR margin was 2.00% and the ABR margin was 1.00% for the three months ended December 31, 2017 . (3) The Term Loan B provided for quarterly amortization payments totaling 1% per annum of the original principal amount. The interest rate with respect to term loans under the Term Loan B was based on, at the Company’s option, (a) adjusted LIBOR plus 2.25% (with a LIBOR floor of 0.75% ) or (b) JPMorgan Chase Bank, N.A.’s prime rate (" ABR ") plus 1.25% (with an ABR floor of 1.75% ). See Note 19, "Subsequent Events" for a description of the February 2018 refinancing. (4) The Term Loan A provided for quarterly amortization payments, which commenced March 31, 2016, totaling per annum 5% , 5% , 7.5% , 10.0% and 12.5% of the original principal amount of the Term Loan A in 2016, 2017, 2018, 2019 and 2020, respectively. The interest rates with respect to term loans under the Term Loan A were based on, at the Company's option, (a) adjusted LIBOR plus an additional margin or (b) ABR plus an additional margin, in each case subject to adjustment based on the then current senior secured leverage ratio. Based on the previous quarter senior secured leverage ratio, the LIBOR margin was 2.00% and the ABR margin was 1.00% for the three months ended December 31, 2017 . See Note 19, "Subsequent Events" for a description of the February 2018 refinancing. (5) The Term Loan A-1 provided for quarterly amortization payments, which commenced on September 30, 2016, totaling per annum 2.5% , 2.5% , 5% , 7.5% and 10.0% of the original principal amount of the Term Loan A-1, with the last amortization payment made on June 30, 2021. The interest rates with respect to term loans under the Term Loan A-1 were based on, at the Company's option, (a) adjusted LIBOR plus an additional margin or (b) ABR plus an additional margin, in each case subject to adjustment based on the then current senior secured leverage ratio. Based on the previous quarter senior secured leverage ratio, the LIBOR margin was 2.00% and the ABR margin was 1.00% for the three months ended December 31, 2017 . See Note 19, "Subsequent Events" for a description of the February 2018 refinancing. (6) Available capacity is subject to maintaining sufficient relocation related assets to collateralize these securitization obligations. (7) In November 2017, the capacity of the Apple Ridge facility was reduced from $325 million to $250 million . As of December 31, 2017 , the Company had $250 million of borrowing capacity under the Apple Ridge Funding LLC securitization program leaving $69 million of available capacity. (8) Consists of a £10 million revolving loan facility and a £5 million working capital facility. As of December 31, 2017 , the Company had $20 million of borrowing capacity under the Cartus Financing Limited securitization program leaving $7 million of available capacity. (9) Not included in this table is the Company's Unsecured Letter of Credit Facility which had a capacity of $74 million with $69 million utilized at a weighted average rate of 3.24% at December 31, 2017 . |
Schedule of Maturities of Long-term Debt | As of December 31, 2017 , the combined aggregate amount of maturities for long-term borrowings, excluding securitization obligations, for each of the next five years is as follows: Year Amount 2018 (a) $ 127 2019 527 2020 356 2021 837 2022 1,039 _______________ (a) The current portion of long-term debt consists of four quarters of 2018 amortization payments totaling $33 million , $13 million and $11 million for the Term Loan A, Term Loan A-1 and Term Loan B facilities, respectively, as well as $70 million of revolver borrowings under the revolving credit facility which expires in October 2020, but are classified on the balance sheet as current due to the revolving nature of the facility. See Note 19, "Subsequent Events" for a description of the February 2018 refinancing. |
Interest Rate Table for Revolving Credit Facility | Senior Secured Leverage Ratio Applicable LIBOR Margin Applicable ABR Margin Greater than 3.50 to 1.00 2.50% 1.50% Less than or equal to 3.50 to 1.00 but greater than or equal to 2.50 to 1.00 2.25% 1.25% Less than 2.50 to 1.00 2.00% 1.00% |
Interest Rate Table for Term Loan A | Senior Secured Leverage Ratio Applicable LIBOR Margin Applicable ABR Margin Greater than 3.50 to 1.00 2.50% 1.50% Less than or equal to 3.50 to 1.00 but greater than or equal to 2.50 to 1.00 2.25% 1.25% Less than 2.50 to 1.00 2.00% 1.00% |
Interest Rate Table for Term Loan A-1 | Senior Secured Leverage Ratio Applicable LIBOR Margin Applicable ABR Margin Greater than 3.50 to 1.00 2.50% 1.50% Less than or equal to 3.50 to 1.00 but greater than or equal to 2.50 to 1.00 2.25% 1.25% Less than 2.50 to 1.00 but greater than or equal to 2.00 to 1.00 2.00% 1.00% Less than 2.00 to 1.00 1.75% 0.75% |
Expiration Capacity Table for Unsecured Letter of Credit Facilities | The facility's expiration dates are as follows: Capacity (in millions) Expiration Date $8 September 2018 $66 December 2019 |
Note 9. Employee Benefit Plan34
Note 9. Employee Benefit Plans Employee Benefit Plans (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Retirement Benefits [Abstract] | |
Schedule of Expected Benefit Payments | Estimated future benefit payments as of December 31, 2017 are as follows: Year Amount 2018 $ 9 2019 9 2020 9 2021 10 2022 10 2023 through 2027 47 |
Schedule of Allocation of Plan Assets | The following table presents the fair values of plan assets by category as of December 31, 2017 : Asset Category Quoted Price in Active Market for Identical Assets (Level I) Significant Other Observable Inputs (Level II) Significant Unobservable Inputs (Level III) Total Cash and cash equivalents $ 1 $ — $ — $ 1 Equity securities — 71 — 71 Fixed income securities — 36 — 36 Total $ 1 $ 107 $ — $ 108 The following table presents the fair values of plan assets by category as of December 31, 2016 : Asset Category Quoted Price in Active Market for Identical Assets (Level I) Significant Other Observable Inputs (Level II) Significant Unobservable Inputs (Level III) Total Cash and cash equivalents $ 1 $ — $ — $ 1 Equity securities — 74 — 74 Fixed income securities — 29 — 29 Total $ 1 $ 103 $ — $ 104 |
Note 10. Income Taxes Income 35
Note 10. Income Taxes Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |
Schedule of pre-tax income (loss) for domestic and foreign operations | The components of pretax income for domestic and foreign operations consisted of the following: Year Ended December 31, 2017 2016 2015 Domestic $ 365 $ 351 $ 290 Foreign 4 10 8 Pretax income $ 369 $ 361 $ 298 |
Schedule of income tax provision | The components of income tax (benefit) expense consisted of the following: Year Ended December 31, 2017 2016 2015 Current: Federal $ (7 ) $ 10 $ 8 State 4 8 3 Foreign 1 2 3 Total current (2 ) 20 14 Deferred: Federal (72 ) 107 91 State 9 16 4 Foreign — 1 1 Total deferred (63 ) 124 96 Income tax (benefit) expense $ (65 ) $ 144 $ 110 |
Schedule of effective income tax rate | A reconciliation of the Company’s effective income tax rate at the U.S. federal statutory rate of 35% to the actual expense was as follows: Year Ended December 31, 2017 2016 2015 Federal statutory rate 35 % 35 % 35 % State and local income taxes, net of federal tax benefits 4 4 2 Impact of the 2017 Tax Act (50 ) — — Permanent differences — 1 1 Uncertain tax positions (9 ) — — Net change in valuation allowance 1 — 1 Other 1 — (2 ) Effective tax rate (18 %) 40 % 37 % |
Schedule of deferred income tax assets and liabilities | Deferred income taxes result from temporary differences between the amount of assets and liabilities recognized for financial reporting and tax purposes. The components of the deferred income tax assets and liabilities, as of December 31, are as follows: 2017 2016 Deferred income tax assets: Net operating loss carryforwards $ 288 $ 503 Tax credit carryforwards 35 41 Accrued liabilities and deferred income 85 131 Minimum pension obligations 16 23 Provision for doubtful accounts 8 16 Liability for unrecognized tax benefits 1 3 Interest rate swaps 2 8 Total deferred tax assets 435 725 Less: valuation allowance (13 ) (10 ) Total deferred income tax assets after valuation allowance 422 715 Deferred income tax liabilities: Depreciation and amortization 736 1,099 Prepaid expenses 2 1 Undistributed foreign earnings — 2 Basis difference in investment in joint ventures 10 2 Total deferred tax liabilities 748 1,104 Net deferred income tax liabilities $ (326 ) $ (389 ) |
Schedule of the rollforward of unrecognized tax benefits | The rollforward of unrecognized tax benefits are summarized in the table below: Unrecognized tax benefits—January 1, 2015 $ 106 Gross decreases—tax positions in prior periods (4 ) Gross increases—tax positions in current period 1 Settlements (23 ) Reduction due to lapse of statute of limitations (2 ) Unrecognized tax benefits—December 31, 2015 78 Gross increases—tax positions in prior periods 3 Reduction due to lapse of statute of limitations (3 ) Unrecognized tax benefits—December 31, 2016 78 Gross increases—tax positions in prior periods 1 Gross decreases—tax positions in prior periods (54 ) Reduction due to lapse of statute of limitations (3 ) Unrecognized tax benefits—December 31, 2017 $ 22 |
Note 11. Restructuring Costs 36
Note 11. Restructuring Costs Restructuring Costs (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Restructuring and Related Activities [Abstract] | |
Restructuring and Related Costs [Table Text Block] | The components of the restructuring charges for the years ended December 31, 2017 , 2016 and 2015 were as follows: Years Ended December 31, 2017 2016 2015 Personnel-related costs (1) $ 7 $ 22 $ 3 Facility-related costs (2) 3 10 3 Accelerated depreciation on asset disposals 1 1 — Other restructuring costs (3) 1 6 4 Total restructuring charges $ 12 $ 39 $ 10 |
Schedule of Restructuring Reserve by Type of Cost [Table Text Block] | The following is a reconciliation of the beginning and ending restructuring reserve balances for the Business Optimization Initiative: Personnel-related costs Facility-related costs Accelerated depreciation asset disposals Other restructuring costs Total Balance at October 1, 2015 $ — $ — $ — $ — $ — Restructuring charges 3 3 — 4 10 Costs paid or otherwise settled — — — (1 ) (1 ) Balance at December 31, 2015 $ 3 $ 3 $ — $ 3 $ 9 Restructuring charges 22 10 1 6 39 Costs paid or otherwise settled (16 ) (6 ) (1 ) (9 ) (32 ) Balance at December 31, 2016 $ 9 $ 7 $ — $ — $ 16 Restructuring charges 7 3 1 1 12 Costs paid or otherwise settled (13 ) (7 ) — (1 ) (21 ) Balance at December 31, 2017 $ 3 $ 3 $ 1 $ — $ 7 |
Schedule of Expected Restructuring Costs by Cost Type [Table Text Block] | The following table shows the total restructuring costs expected to be incurred by type of cost for the Business Optimization Initiative: Total amount expected to be incurred Amount incurred to date Total amount remaining to be incurred Personnel-related costs $ 32 $ 32 $ — Facility-related costs 16 16 — Accelerated depreciation related to asset disposals 3 2 1 Other restructuring costs 12 11 1 Total $ 63 $ 61 $ 2 |
Schedule of Expected Restructuring Costs by Business Segment [Table Text Block] | The following table shows the total restructuring costs expected to be incurred by reportable segment for the Business Optimization Initiative: Total amount expected to be incurred Amount incurred to date Total amount remaining to be incurred Real Estate Franchise Services $ 5 $ 5 $ — Company Owned Real Estate Brokerage Services 36 36 — Relocation Services 5 5 — Title and Settlement Services 2 2 — Corporate and Other 15 13 2 Total $ 63 $ 61 $ 2 |
Note 12. Stock-Based Compensa37
Note 12. Stock-Based Compensation Stock-Based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Share-based Compensation, Activity | A summary of activity for the year ended December 31, 2017 is presented below (number of shares in millions): Restricted Stock Units Weighted Average Grant Date Fair Value Performance Share Units (a) Weighted Average Grant Date Fair Value Options (f) Weighted Average Exercise Price Outstanding at January 1, 2017 1.5 $ 37.72 1.4 $ 38.31 3.3 $ 31.69 Granted 1.2 28.61 0.7 27.70 0.7 29.60 Distributed/Exercised (0.6 ) (b) 39.64 (0.3 ) (c) 42.30 (0.3 ) (d) 23.29 Forfeited/Expired (0.1 ) 30.90 — — (0.1 ) 50.24 Outstanding at December 31, 2017 2.0 $ 31.71 1.8 $ 33.16 3.6 (e) $ 31.75 _______________ (a) The PSU amounts in the table are shown at the target amount of the award. (b) The total fair value of RSUs which were distributed during the year ended December 31, 2017 was $26 million . (c) The total fair value of PSUs which were distributed during the year ended December 31, 2017 was $14 million , which includes the distribution of PSUs awarded in 2014, measuring performance over a three-year performance period ended December 31, 2016, at a fair value of $10 million . Amounts distributed do not include 0.2 million PSUs awarded in 2015, measuring performance over a three-year period ended and vested December 31, 2017, at a fair value of $9 million and at a weighted average grant date fair value of $46.46 . These PSUs were distributed in early 2018. (d) The intrinsic value of options exercised during the year ended December 31, 2017 was $2 million . Cash received from options exercised during the year ended December 31, 2017 was $8 million . (e) Options outstanding at December 31, 2017 have an intrinsic value of $6 million and have a weighted average remaining contractual life of 5.8 years . (f) The following table summarizes information regarding exercisable stock options as of December 31, 2017 : Range of Exercise Prices Options Vested Weighted Average Exercise Price Aggregate Intrinsic Value Weighted Average Remaining Contractual Life $15.00 to $50.00 2.4 $ 27.86 $ 6.3 4.7 years $50.01 and above 0.1 $ 140.26 $ — 2.8 years |
Summary of Exercisable Stock Options Activity | The following table summarizes information regarding exercisable stock options as of December 31, 2017 : Range of Exercise Prices Options Vested Weighted Average Exercise Price Aggregate Intrinsic Value Weighted Average Remaining Contractual Life $15.00 to $50.00 2.4 $ 27.86 $ 6.3 4.7 years $50.01 and above 0.1 $ 140.26 $ — 2.8 years |
Schedule of Market Performance Unit Award Valuation Assumptions | he fair value of the PSU RTSR award was estimated on the date of grant using the Monte Carlo Simulation method utilizing the following assumptions: 2017 RTSR PSU 2016 RTSR PSU 2015 RTSR PSU Weighted average grant date fair value $ 27.98 $ 27.99 $ 41.08 Weighted average expected volatility (a) 29.0 % 28.1 % 25.1 % Weighted average volatility of XHB 18.4 % 19.4 % 21.1 % Weighted average correlation coefficient 0.53 0.58 0.57 Weighted average risk-free interest rate 1.5 % 0.9 % 1.0 % Weighted average dividend yield — — — _______________ (a) Expected volatility is based on historical volatilities of the Company and select comparable companies. |
Summary of Stock Options Valuation Assumptions | The fair value of the options was estimated on the date of grant using the Black-Scholes option-pricing model utilizing the following assumptions: 2017 Options 2016 Options 2015 Options Weighted average grant date fair value $ 8.61 $ 10.81 $ 17.66 Weighted average expected volatility (a) 30.7 % 31.7 % 36.1 % Weighted average expected term (years) (b) 6.25 6.25 6.25 Weighted average risk-free interest rate (c) 2.0 % 1.3 % 1.6 % Weighted average dividend yield 1.2 % 0.1 % — % _______________ (a) Expected volatility was based on historical volatilities of the Company and select comparable companies. (b) The expected term of the options granted represents the period of time that options are expected to be outstanding and is based on the simplified method. (c) The risk-free interest rate was based on the U.S. Treasury yield curve in effect at the time of the grant, which corresponds to the expected term of the options. |
Note 13. Commitments And Cont38
Note 13. Commitments And Contingencies Commitments And Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Future Minimum Rental Payments for Operating Leases | Future minimum lease payments required under noncancelable operating leases as of December 31, 2017 are as follows: Year Amount 2018 $ 163 2019 142 2020 116 2021 91 2022 72 Thereafter 196 Total $ 780 |
Schedule of Future Minimum Payments for Purchase Commitments and Licensing Fees | Future minimum payments for these purchase commitments and minimum licensing fees as of December 31, 2017 are as follows: Year Amount 2018 $ 57 2019 23 2020 15 2021 13 2022 18 Thereafter 222 Total $ 348 |
Note 14. Equity (Deficit) Equ39
Note 14. Equity (Deficit) Equity (Deficit) (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Equity [Abstract] | |
Schedule of Accumulated Other Comprehensive Income (Loss) [Table Text Block] | The components of accumulated other comprehensive losses are as follows: Currency Translation Adjustments (1) Minimum Pension Liability Adjustment Accumulated Other Comprehensive Loss (2) Balance at January 1, 2015 $ — $ (35 ) $ (35 ) Other comprehensive income (loss) before reclassifications (4 ) 1 (3 ) Amounts reclassified from accumulated other comprehensive income — 2 (3) 2 Income tax (expense) benefit 1 (1 ) — Current period change (3 ) 2 (1 ) Balance at December 31, 2015 (3 ) (33 ) (36 ) Other comprehensive loss before reclassifications (5 ) (3 ) (8 ) Amounts reclassified from accumulated other comprehensive income — 1 (3) 1 Income tax benefit 2 1 3 Current period change (3 ) (1 ) (4 ) Balance at December 31, 2016 (6 ) (34 ) (40 ) Other comprehensive income (loss) before reclassifications 3 (1 ) 2 Amounts reclassified from accumulated other comprehensive income — 2 (3) 2 Income tax expense (1 ) — (1 ) Current period change 2 1 3 Balance at December 31, 2017 $ (4 ) $ (33 ) $ (37 ) _______________ (1) Assets and liabilities of foreign subsidiaries having non-U.S. dollar functional currencies are translated at exchange rates at the balance sheet dates and equity accounts are translated at historical spot rates. Revenues and expenses are translated at average exchange rates during the periods presented. The gains or losses resulting from translating foreign currency financial statements into U.S. dollars are included in accumulated other comprehensive income (loss). Gains or losses resulting from foreign currency transactions are included in the Consolidated Statements of Operations. (2) As of December 31, 2017 , the Company does not have any after-tax components of accumulated other comprehensive loss attributable to noncontrolling interests. (3) These amounts represent the amortization of actuarial loss to periodic pension cost and were reclassified from accumulated other comprehensive income to the general and administrative expenses line on the statement of operations. |
Schedule of Stockholders Equity [Table Text Block] | Realogy Group Stockholder’s Equity Common Stock Additional Paid-In Capital Accumulated Deficit Accumulated Other Comprehensive Loss Non- controlling Interests Total Equity Shares Amount Balance at January 1, 2015 — $ — $ 5,678 $ (3,464 ) $ (35 ) $ 4 $ 2,183 Net income — — — 184 — 4 188 Other comprehensive loss — — — — (1 ) — (1 ) Contributions from Realogy Holdings — — 5 — — — 5 Stock-based compensation — — 51 — — — 51 Dividends — — — — — (4 ) (4 ) Balance at December 31, 2015 — $ — $ 5,734 $ (3,280 ) $ (36 ) $ 4 $ 2,422 Cumulative effect of adoption of new accounting pronouncements related to stock-based compensation — — — 5 — — 5 Net income — — — 213 — 4 217 Other comprehensive loss — — — — (4 ) — (4 ) Repurchase of Common Stock — — (195 ) — — — (195 ) Contributions from Realogy Holdings — — 2 — — — 2 Stock-based compensation — — 51 — — — 51 Dividends — — (26 ) — — (3 ) (29 ) Balance at December 31, 2016 — $ — $ 5,566 $ (3,062 ) $ (40 ) $ 5 $ 2,469 Net income — — — 431 — 3 434 Other comprehensive income — — — — 3 — 3 Repurchase of Common Stock — — (280 ) — — — (280 ) Contributions from Realogy Holdings — — 8 — — — 8 Stock-based compensation — — 41 — — — 41 Dividends — — (49 ) — — (4 ) (53 ) Balance at December 31, 2017 — $ — $ 5,286 $ (2,631 ) $ (37 ) $ 4 $ 2,622 |
Note 15. Earnings (Loss) Per Sh
Note 15. Earnings (Loss) Per Share Earnings (Loss) Per Share (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share, Basic and Diluted [Table Text Block] | The following table sets forth the computation of basic and diluted earnings per share: Year Ended December 31, (in millions, except per share data) 2017 2016 2015 Net income attributable to Realogy Holdings shareholders $ 431 $ 213 $ 184 Basic weighted average shares 136.7 144.5 146.5 Stock options, restricted stock, restricted stock units and performance share units (a) 1.7 1.3 1.6 Weighted average diluted shares 138.4 145.8 148.1 Earnings Per Share: Basic $ 3.15 $ 1.47 $ 1.26 Diluted $ 3.11 $ 1.46 $ 1.24 _______________ (a) Excludes 5.3 million , 4.5 million and 3.5 million shares of common stock issuable for incentive equity awards, including performance share units based on the achievement of target amounts, for the years ended December 31, 2017 , 2016 and 2015 , respectively, which are anti-dilutive to the diluted earnings per share computation. |
Risk Management and Fair Valu41
Risk Management and Fair Value of Financial Instruments (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Risk Management and Fair Value of Financial Instruments [Abstract] | |
Schedule of Derivative Instruments [Table Text Block] | the term loan facilities as follows: Notional Value (in millions) Commencement Date Expiration Date $225 July 2012 February 2018 (a) $200 January 2013 February 2018 (a) $600 August 2015 August 2020 $450 November 2017 (a) November 2022 _______________ (a) Interest rates swaps with a notional value of $425 million expired February 10, 2018, and interest rate swaps with a notional value of $450 million commenced in the fourth quarter of 2017. Notional Value (in millions) Commencement Date Expiration Date $225 July 2012 February 2018 (a) $200 January 2013 February 2018 (a) $600 August 2015 August 2020 $450 November 2017 (a) November 2022 _______________ (a) Interest rates swaps with a notional value of $425 million expired February 10, 2018, and interest rate swaps with a notional value of $450 million commenced in the fourth quarter of 2017. |
Schedule of Derivative Instruments in Statement of Financial Position, Fair Value | The fair value of derivative instruments was as follows: Liability Derivatives Fair Value Not Designated as Hedging Instruments Balance Sheet Location December 31, 2017 December 31, 2016 Interest rate swap contracts Other current and non-current liabilities $ 13 $ 33 |
Schedule of Derivative Instruments, Gain (Loss) in Statement of Financial Performance | Derivative Instruments Not Designated as Hedging Instruments Location of (Gain) or Loss Recognized for Derivative Instruments (Gain) or Loss Recognized on Derivatives Year Ended December 31, 2017 2016 2015 Interest rate swap contracts Interest expense $ (4 ) $ 6 $ 20 Foreign exchange contracts Operating expense 2 (2 ) (2 ) |
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis | The following table summarizes fair value measurements by level at December 31, 2017 for assets and liabilities measured at fair value on a recurring basis: Level I Level II Level III Total Interest rate swaps (included in other current and non-current liabilities) $ — $ 13 $ — $ 13 Deferred compensation plan assets (included in other non-current assets) 3 — — 3 Contingent consideration for acquisitions (included in accrued expenses and other current liabilities and non-current liabilities) — — 34 34 The following table summarizes fair value measurements by level at December 31, 2016 for assets and liabilities measured at fair value on a recurring basis: Level I Level II Level III Total Interest rate swaps (included in other non-current liabilities) $ — $ 33 $ — $ 33 Deferred compensation plan assets (included in other non-current assets) 3 — — 3 Contingent consideration for acquisitions (included in accrued expenses and other current liabilities and non-current liabilities) — — 50 50 |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation | The following table presents changes in Level III financial liabilities measured at fair value on a recurring basis: Level III Fair value of contingent consideration at December 31, 2016 $ 50 Additions: contingent consideration related to acquisitions completed during the period 7 Reductions: payments of contingent consideration (22 ) Changes in fair value (reflected in the Consolidated Statement of Operations) (1 ) Fair value of contingent consideration at December 31, 2017 $ 34 |
Schedule of Carrying Values and Estimated Fair Values of Debt Instruments | The following table summarizes the principal amount of the Company’s indebtedness compared to the estimated fair value, primarily determined by quoted market values, at: December 31, 2017 December 31, 2016 Debt Principal Amount Estimated Fair Value (a) Principal Amount Estimated Fair Value (a) Senior Secured Credit Facility: Revolving Credit Facility $ 70 $ 70 $ 200 $ 200 Term Loan B 1,083 1,085 1,094 1,100 Term Loan A Facility: Term Loan A 391 393 413 414 Term Loan A-1 342 343 351 351 4.50% Senior Notes 450 457 450 461 5.25% Senior Notes 550 569 550 562 4.875% Senior Notes 500 495 500 483 Securitization obligations 194 194 205 205 _______________ (a) The fair value of the Company's indebtedness is categorized as Level II. |
Segment Information (Tables)
Segment Information (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Segment Reporting [Abstract] | |
Revenues | Revenues (a) (b) Year Ended December 31, 2017 2016 2015 Real Estate Franchise Services $ 830 $ 781 $ 755 Company Owned Real Estate Brokerage Services 4,643 4,344 4,344 Relocation Services 382 405 415 Title and Settlement Services 570 573 487 Corporate and Other (c) (311 ) (293 ) (295 ) Total Company $ 6,114 $ 5,810 $ 5,706 _______________ (a) Transactions between segments are eliminated in consolidation. Revenues for the Real Estate Franchise Services segment include intercompany royalties and marketing fees paid by the Company Owned Real Estate Brokerage Services segment of $311 million , $293 million and $295 million for the years ended December 31, 2017 , 2016 and 2015 , respectively. Such amounts are eliminated through the Corporate and Other line. (b) Revenues for the Relocation Services segment include intercompany referral commissions paid by the Company Owned Real Estate Brokerage Services segment of $40 million , $43 million and $49 million for the years ended December 31, 2017 , 2016 and 2015 , respectively. Such amounts are recorded as contra-revenues by the Company Owned Real Estate Brokerage Services segment. There are no other material intersegment transactions. (c) Includes the elimination of transactions between segments. |
EBITDA | EBITDA Year Ended December 31, 2017 (a) 2016 (b) 2015 (c) Real Estate Franchise Services $ 559 $ 516 $ 495 Company Owned Real Estate Brokerage Services 126 137 199 Relocation Services 85 96 105 Title and Settlement Services 58 62 48 Corporate and Other (d) (103 ) (78 ) (121 ) Total Company $ 725 $ 733 $ 726 ______________ (a) For the year ended December 31, 2017 , the Real Estate Franchise Services segment includes restructuring charges of $1 million ; the Company Owned Real Estate Brokerage Services segment includes restructuring charges of $9 million ; the Title and Settlement Services segment includes restructuring charges of $1 million ; and Corporate and Other includes an $8 million expense related to the settlement of the Strader legal matter, an $8 million expense related to the transition of the Company's CEO, $5 million related to the losses on the early extinguishment of debt and restructuring charges of $1 million , partially offset by a net benefit of $10 million of former parent legacy items. (b) For the year ended December 31, 2016 , the Real Estate Franchise Services segment includes restructuring charges of $4 million ; the Company Owned Real Estate Brokerage Services segment includes restructuring charges of $22 million ; the Relocation Services segment includes restructuring charges of $4 million ; the Title and Settlement Services segment includes restructuring charges of $1 million ; and Corporate and Other includes restructuring charges of $8 million , partially offset by a net benefit of $2 million of former parent legacy items. (c) For the year ended December 31, 2015 , the Company Owned Real Estate Brokerage Services segment includes restructuring charges of $5 million ; the Relocation Services segment includes restructuring charges of $1 million ; and Corporate and Other includes $48 million related to the loss on the early extinguishment of debt and restructuring charges of $4 million , partially offset by a net benefit of $15 million of former parent legacy items. (d) Includes the elimination of transactions between segments. Provided below is a reconciliation of EBITDA to Net income attributable to Realogy Holdings and Realogy Group: Year Ended December 31, 2017 2016 2015 Net income attributable to Realogy Holdings and Realogy Group $ 431 $ 213 $ 184 Add: Depreciation and amortization (a) 201 202 201 Interest expense, net 158 174 231 Income tax (benefit) expense (65 ) 144 110 EBITDA $ 725 $ 733 $ 726 _______________ (a) Depreciation and amortization for the year ended December 31, 2017 includes $3 million of amortization expense related to Guaranteed Rate Affinity's purchase accounting included in the "Equity in earnings of unconsolidated entities" line on the Consolidated Statement of Operations. |
Reconciliation of Depreciation and Amortization from Segments to Consolidated | Depreciation and Amortization Year Ended December 31, 2017 2016 2015 Real Estate Franchise Services $ 79 $ 77 $ 77 Company Owned Real Estate Brokerage Services 50 49 46 Relocation Services 33 31 33 Title and Settlement Services 16 23 25 Corporate and Other 20 22 20 Total Company $ 198 $ 202 $ 201 |
Segment Assets | Segment Assets As of December 31, 2017 2016 Real Estate Franchise Services $ 4,413 $ 4,477 Company Owned Real Estate Brokerage Services 1,258 1,249 Relocation Services 1,029 1,081 Title and Settlement Services 486 416 Corporate and Other 151 198 Total Company $ 7,337 $ 7,421 |
Reconciliation of Capital Expenditures from Segments to Consolidated | Capital Expenditures Year Ended December 31, 2017 2016 2015 Real Estate Franchise Services $ 9 $ 8 $ 8 Company Owned Real Estate Brokerage Services 44 44 41 Relocation Services 11 12 14 Title and Settlement Services 13 9 8 Corporate and Other 22 14 13 Total Company $ 99 $ 87 $ 84 |
Geographic Segment Information | The geographic segment information provided below is classified based on the geographic location of the Company’s subsidiaries. United States All Other Countries Total On or for the year ended December 31, 2017 Net revenues $ 5,997 $ 117 $ 6,114 Total assets 7,261 76 7,337 Net property and equipment 287 2 289 On or for the year ended December 31, 2016 Net revenues $ 5,683 $ 127 $ 5,810 Total assets 7,347 74 7,421 Net property and equipment 265 2 267 On or for the year ended December 31, 2015 Net revenues $ 5,579 $ 127 $ 5,706 Total assets 7,450 81 7,531 Net property and equipment 252 2 254 |
Selected Quarterly Financial 43
Selected Quarterly Financial Data (Unaudited) (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Quarterly Financial Information Disclosure [Abstract] | |
Schedule of Unaudited Quarterly Financial Data | Provided below is selected unaudited quarterly financial data for 2017 and 2016 . 2017 First Second Third Fourth Net revenues Real Estate Franchise Services $ 170 $ 237 $ 224 $ 199 Company Owned Real Estate Brokerage Services 897 1,392 1,267 1,087 Relocation Services 77 102 111 92 Title and Settlement Services 120 157 154 139 Corporate and Other (a) (61 ) (95 ) (82 ) (73 ) Total Company $ 1,203 $ 1,793 $ 1,674 $ 1,444 Income (loss) before income taxes, equity in earnings and noncontrolling interests (b) Real Estate Franchise Services $ 82 $ 146 $ 139 $ 113 Company Owned Real Estate Brokerage Services (35 ) 65 36 (14 ) Relocation Services (5 ) 21 32 15 Title and Settlement Services (3 ) 23 19 6 Corporate and Other (73 ) (72 ) (73 ) (71 ) Total Company $ (34 ) $ 183 $ 153 $ 49 Net income (loss) attributable to Realogy Holdings and Realogy Group $ (28 ) $ 109 $ 95 $ 255 Income (loss) per share attributable to Realogy Holdings (c) : Basic income (loss) per share $ (0.20 ) $ 0.79 $ 0.70 $ 1.91 Diluted income (loss) per share $ (0.20 ) $ 0.78 $ 0.69 $ 1.89 _______________ (a) Represents the elimination of transactions primarily between the Real Estate Franchise Services segment and the Company Owned Real Estate Brokerage Services segment. (b) The quarterly results include the following: • an $8 million expense related to the settlement of the Strader legal matter in the second quarter; • restructuring charges of $5 million , $2 million , $2 million and $3 million in the first, second, third and fourth quarters, respectively; • former parent legacy net benefit of $11 million in the second quarter and former parent legacy net cost of $1 million in the third quarter; • a loss on the early extinguishment of debt of $4 million and $1 million in the first and third quarters, respectively; • mark-to-market adjustments for interest rate swaps of a $1 million gain , a $5 million loss , and an $8 million gain in the first, second and fourth quarters, respectively; and • an $8 million expense related to the transition of the Company's CEO in the fourth quarter. (c) Basic and diluted EPS amounts in each quarter are computed using the weighted-average number of shares outstanding during that quarter, while basic and diluted EPS for the full year is computed using the weighted-average number of shares outstanding during the year. Therefore, the sum of the four quarters’ basic or diluted EPS may not equal the full year basic or diluted EPS (see Note 15 "Earnings Per Share" for further information). 2016 First Second Third Fourth Net revenues Real Estate Franchise Services $ 157 $ 221 $ 215 $ 188 Company Owned Real Estate Brokerage Services 841 1,268 1,231 1,004 Relocation Services 83 109 116 97 Title and Settlement Services 111 149 164 149 Corporate and Other (a) (58 ) (85 ) (82 ) (68 ) Total Company $ 1,134 $ 1,662 $ 1,644 $ 1,370 Income (loss) before income taxes, equity in earnings and noncontrolling interests (b) Real Estate Franchise Services $ 73 $ 130 $ 133 $ 102 Company Owned Real Estate Brokerage Services (32 ) 63 55 (8 ) Relocation Services (1 ) 22 34 16 Title and Settlement Services (5 ) 21 17 6 Corporate and Other (101 ) (83 ) (63 ) (30 ) Total Company $ (66 ) $ 153 $ 176 $ 86 Net income (loss) attributable to Realogy Holdings and Realogy Group $ (42 ) $ 92 $ 106 $ 57 Income (loss) per share attributable to Realogy Holdings (c) : Basic income (loss) per share $ (0.29 ) $ 0.63 $ 0.74 $ 0.40 Diluted income (loss) per share $ (0.29 ) $ 0.63 $ 0.73 $ 0.40 _______________ (a) Represents the elimination of transactions primarily between the Real Estate Franchise Services segment and the Company Owned Real Estate Brokerage Services segment. (b) The quarterly results include the following: • former parent legacy net cost of $1 million in the first quarter and former parent legacy net benefit of $3 million in the fourth quarter; • restructuring charges of $9 million , $12 million , $9 million and $9 million in the first, second, third and fourth quarters, respectively; and • mark-to-market adjustments for interest rate swaps of a $31 million loss , a $14 million loss , a $5 million gain , and a $34 million gain in the first, second, third and fourth quarters, respectively. (c) Basic and diluted EPS amounts in each quarter are computed using the weighted-average number of shares outstanding during that quarter, while basic and diluted EPS for the full year is computed using the weighted-average number of shares outstanding during the year. Therefore, the sum of the four quarters’ basic or diluted EPS may not equal the full year basic or diluted EPS. |
Note 1. Basis of Presentation44
Note 1. Basis of Presentation Business Description (Details) | Dec. 31, 2017Brokerage_Offices | Dec. 31, 2017franchisedandcompanyownedoffices | Dec. 31, 2017metropolitan_areas | Dec. 31, 2017Countries | Dec. 31, 2017employees | Dec. 31, 2016franchisedandcompanyownedoffices | Dec. 31, 2015franchisedandcompanyownedoffices | Dec. 31, 2014franchisedandcompanyownedoffices |
Number of International Countries in which Entity Operates | Countries | 115 | |||||||
Number of largest metropolitan areas | metropolitan_areas | 50 | |||||||
Franchised and Company Owned | ||||||||
Number of offices | franchisedandcompanyownedoffices | 14,800 | |||||||
Number of Independent Sales Associates | employees | 289,000 | |||||||
Company Owned Real Estate Brokerage Services | ||||||||
Number of offices | 790 | 789 | 789 | 787 | 727 | |||
Number of Independent Sales Associates | employees | 50,300 | |||||||
Maximum | ||||||||
Number of largest metropolitan areas | metropolitan_areas | 100 |
Note 2. Summary of Significan45
Note 2. Summary of Significant Accounting Policies Summary of Significant Accounting Policies (Details) - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Minimum ownership percentage for consolidation | 50.00% | |||
Restricted cash | $ 7 | $ 7 | ||
Advertising Expense | 211 | 198 | $ 194 | |
Goodwill | 3,710 | $ 3,690 | $ 3,618 | $ 3,477 |
Indefinite-Lived Intangible Assets (Excluding Goodwill) | $ 767 | |||
Percentage by which the estimated fair value of each reporting unit is lowered during goodwill evaluation | 10.00% | 10.00% | 10.00% | |
Maximum | ||||
Remaining maturity of highly-liquid investments | 3 months |
Note 2. Summary of Significan46
Note 2. Summary of Significant Accounting Policies Derivative Instruments (Details) - Interest rate swap contracts $ in Millions | Dec. 31, 2017USD ($) | |
Derivative [Line Items] | ||
Notional value of derivative instrument | $ 1,475 | |
July 2,012 | ||
Derivative [Line Items] | ||
Notional value of derivative instrument | 225 | [1],[2] |
January 2,013 | ||
Derivative [Line Items] | ||
Notional value of derivative instrument | 200 | [1],[2] |
August 2,015 | ||
Derivative [Line Items] | ||
Notional value of derivative instrument | 600 | |
November 2,017 | ||
Derivative [Line Items] | ||
Notional value of derivative instrument | 450 | [1],[2] |
July 2012 and January 2013 | ||
Derivative [Line Items] | ||
Notional value of derivative instrument | $ 425 | |
[1] | (a)Interest rates swaps with a notional value of $425 million expired February 10, 2018, and interest rate swaps with a notional value of $450 million commenced in the fourth quarter of 2017. | |
[2] | Interest rates swaps with a notional value of $425 million expired February 10, 2018, and interest rate swaps with a notional value of $450 million commenced in the fourth quarter of 2017. |
Note 2. Summary of Significan47
Note 2. Summary of Significant Accounting Policies Investments (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | ||
Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Schedule of Equity Method Investments [Line Items] | ||||
Equity Method Investments | $ 74 | $ 66 | ||
Income (Loss) from Equity Method Investments | (18) | (12) | $ (16) | |
Payments to Acquire Equity Method Investments | 55 | 0 | 0 | |
Company Owned Real Estate Brokerage Services | Gain from sale of PHHHL assets by Guaranteed Rate Affinity | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Income (Loss) from Equity Method Investments | (35) | |||
Company Owned Real Estate Brokerage Services | Exit Costs related to PHHHL | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Income (Loss) from Equity Method Investments | 7 | |||
Title and Settlement Services | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Income (Loss) from Equity Method Investments | 4 | |||
Title and Settlement Services | Amortization of Intangible Assets related to GRA Acquisition | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Income (Loss) from Equity Method Investments | $ 3 | |||
PHH Home Loans | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Equity Method Investment, Ownership Percentage | 49.90% | |||
Equity Method Investments | $ 19 | 59 | ||
Income (Loss) from Equity Method Investments | (14) | |||
Proceeds from Equity Method Investment, Distribution | $ 7 | 60 | $ 10 | |
PHH Home Loans | Company Owned Real Estate Brokerage Services | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Income (Loss) from Equity Method Investments | $ 6 | $ (8) | ||
Guaranteed Rate Affinity | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Equity Method Investment, Ownership Percentage | 49.90% | |||
Equity Method Investment, Unowned Percentage | 50.10% | |||
Equity Method Investments | $ 48 |
Note 2. Summary of Significan48
Note 2. Summary of Significant Accounting Policies Property, Plant and Equipment (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Building | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Useful Life | 30 years | |
Leasehold Improvements | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Useful Life | 20 years | |
Furniture and Fixtures | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Useful Life | 3 years | |
Furniture and Fixtures | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Useful Life | 7 years | |
Software | ||
Property, Plant and Equipment [Line Items] | ||
Capitalized Computer Software, Net | $ 86 | $ 83 |
Software | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Useful Life | 1 year | |
Software | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Property, Plant and Equipment, Useful Life | 5 years |
Note 2. Summary of Significan49
Note 2. Summary of Significant Accounting Policies Supplemental Cash Flow Information (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Supplemental Cash Flow Information [Abstract] | |||
Capital Lease Obligations Incurred | $ 18 | $ 14 | $ 17 |
Note 2. Summary of Significan50
Note 2. Summary of Significant Accounting Policies New Accounting Pronouncements (Details) - USD ($) $ in Millions | Mar. 31, 2018 | Dec. 31, 2016 |
Item Effected [Line Items] | ||
Cumulative Effect of New Accounting Principle in Period of Adoption | $ 5 | |
Subsequent Event | ||
Item Effected [Line Items] | ||
Cumulative Effect of New Accounting Principle in Period of Adoption | $ 9 |
Note 3. Acquisitions Acquisit51
Note 3. Acquisitions Acquisitions (Details) £ in Millions, $ in Millions | 12 Months Ended | |||
Dec. 31, 2017GBP (£)real_estate_brokerage_operations | Dec. 31, 2017USD ($)real_estate_brokerage_operations | Dec. 31, 2016USD ($)real_estate_brokerage_operations | Dec. 31, 2015USD ($)real_estate_brokerage_operations | |
Business Acquisition [Line Items] | ||||
Goodwill acquired | $ 20 | $ 72 | $ 141 | |
Title and Settlement Services | ||||
Business Acquisition [Line Items] | ||||
Number of businesses acquired | real_estate_brokerage_operations | 2 | 2 | 1 | 3 |
Cash consideration paid for acquisition | $ 8 | $ 24 | $ 34 | |
Liabilities established related to acquisition | 4 | 10 | 37 | |
Goodwill acquired | $ 9 | 20 | 47 | |
Other Assets Acquired | 6 | $ 1 | ||
Other Liabilities Acquired | $ 9 | |||
Company Owned Real Estate Brokerage Services | ||||
Business Acquisition [Line Items] | ||||
Number of businesses acquired | real_estate_brokerage_operations | 16 | 16 | 11 | 13 |
Cash consideration paid for acquisition | £ 11 | $ 74 | $ 96 | |
Liabilities established related to acquisition | $ 3 | 9 | 13 | |
Goodwill acquired | $ 10 | 52 | 94 | |
Other Assets Acquired | 5 | 7 | ||
Other Liabilities Acquired | 3 | 3 | ||
Amortizable—Pendings and listings (f) | ||||
Business Acquisition [Line Items] | ||||
Useful Life of Pendings and Listings | 5 months | 5 months | ||
Amortizable—Pendings and listings (f) | Title and Settlement Services | ||||
Business Acquisition [Line Items] | ||||
Finite-lived Intangible Assets Acquired | 8 | |||
Amortizable—Pendings and listings (f) | Company Owned Real Estate Brokerage Services | ||||
Business Acquisition [Line Items] | ||||
Finite-lived Intangible Assets Acquired | $ 2 | 6 | 10 | |
Amortizable—Other (g) | Title and Settlement Services | ||||
Business Acquisition [Line Items] | ||||
Finite-lived Intangible Assets Acquired | 1 | 2 | 5 | |
Amortizable—Other (g) | Company Owned Real Estate Brokerage Services | ||||
Business Acquisition [Line Items] | ||||
Finite-lived Intangible Assets Acquired | 1 | 3 | 1 | |
Pendings | Title and Settlement Services | ||||
Business Acquisition [Line Items] | ||||
Finite-lived Intangible Assets Acquired | 2 | 5 | ||
Amortizable—Customer relationships (d) | Company Owned Real Estate Brokerage Services | ||||
Business Acquisition [Line Items] | ||||
Finite-lived Intangible Assets Acquired | $ 1 | 20 | ||
Indefinite life—Trademarks (b) | Title and Settlement Services | ||||
Business Acquisition [Line Items] | ||||
Indefinite-lived Intangible Assets Acquired | 3 | 9 | ||
Indefinite life—Title plant shares (e) | Title and Settlement Services | ||||
Business Acquisition [Line Items] | ||||
Indefinite-lived Intangible Assets Acquired | $ 7 | $ 1 |
Note 4. Intangible Assets Goodw
Note 4. Intangible Assets Goodwill (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||
Dec. 31, 2008 | Dec. 31, 2007 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2017 | ||
Goodwill [Roll Forward] | |||||||
Goodwill Balance, beginning of period | $ 3,690 | $ 3,618 | $ 3,477 | ||||
Goodwill acquired | 20 | 72 | 141 | ||||
Goodwill Balance, end of period | 3,710 | 3,690 | 3,618 | ||||
Goodwill, Impaired, Accumulated Impairment Loss [Abstract] | |||||||
Gross goodwill | $ 5,496 | ||||||
Accumulated impairment losses (a) | [1] | (1,786) | |||||
Balance at December 31, 2017 | 3,690 | 3,618 | 3,477 | 3,710 | |||
Goodwill and Intangible Asset Impairment [Abstract] | |||||||
Impairment of Goodwill | $ 1,279 | $ 507 | |||||
Real Estate Franchise Services | |||||||
Goodwill [Roll Forward] | |||||||
Goodwill Balance, beginning of period | 2,292 | 2,292 | 2,292 | ||||
Goodwill acquired | 0 | 0 | 0 | ||||
Goodwill Balance, end of period | 2,292 | 2,292 | 2,292 | ||||
Goodwill, Impaired, Accumulated Impairment Loss [Abstract] | |||||||
Gross goodwill | 3,315 | ||||||
Accumulated impairment losses (a) | [1] | (1,023) | |||||
Balance at December 31, 2017 | 2,292 | 2,292 | 2,292 | 2,292 | |||
Company Owned Real Estate Brokerage Services | |||||||
Goodwill [Roll Forward] | |||||||
Goodwill Balance, beginning of period | 893 | 841 | 747 | ||||
Goodwill acquired | 11 | 52 | 94 | ||||
Goodwill Balance, end of period | 904 | 893 | 841 | ||||
Goodwill, Impaired, Accumulated Impairment Loss [Abstract] | |||||||
Gross goodwill | 1,062 | ||||||
Accumulated impairment losses (a) | [1] | (158) | |||||
Balance at December 31, 2017 | 893 | 841 | 747 | 904 | |||
Relocation Services | |||||||
Goodwill [Roll Forward] | |||||||
Goodwill Balance, beginning of period | 360 | 360 | 360 | ||||
Goodwill acquired | 0 | 0 | 0 | ||||
Goodwill Balance, end of period | 360 | 360 | 360 | ||||
Goodwill, Impaired, Accumulated Impairment Loss [Abstract] | |||||||
Gross goodwill | 641 | ||||||
Accumulated impairment losses (a) | [1] | (281) | |||||
Balance at December 31, 2017 | 360 | 360 | 360 | 360 | |||
Title and Settlement Services | |||||||
Goodwill [Roll Forward] | |||||||
Goodwill Balance, beginning of period | 145 | 125 | 78 | ||||
Goodwill acquired | 9 | 20 | 47 | ||||
Goodwill Balance, end of period | 154 | 145 | 125 | ||||
Goodwill, Impaired, Accumulated Impairment Loss [Abstract] | |||||||
Gross goodwill | 478 | ||||||
Accumulated impairment losses (a) | [1] | (324) | |||||
Balance at December 31, 2017 | $ 145 | $ 125 | $ 78 | $ 154 | |||
[1] | During the fourth quarter of 2008 and 2007 the Company recorded impairment charges, which reduced goodwill by $1,279 million and $507 million, respectively. No goodwill or unamortized intangible asset impairments have been recorded since 2008. |
Note 4. Intangible Assets Int53
Note 4. Intangible Assets Intangible Assets (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | ||
Finite-Lived Intangible Assets [Line Items] | |||
Gross carrying amount of indefinite-lived intangible assets | $ 767 | ||
Gross carrying amount of total other intangibles | 647 | $ 652 | |
Accumulated Amortization | 363 | 339 | |
Net carrying amount of finite-lived and indefinite-lived intangible assets | 284 | 313 | |
Indefinite life—Trademarks (b) | |||
Finite-Lived Intangible Assets [Line Items] | |||
Gross carrying amount of indefinite-lived intangible assets | [1] | 749 | 748 |
Indefinite life—Title plant shares (e) | |||
Finite-Lived Intangible Assets [Line Items] | |||
Gross carrying amount of indefinite-lived intangible assets | [2] | 18 | 18 |
Amortizable—Franchise agreements (a) | |||
Finite-Lived Intangible Assets [Line Items] | |||
Finite-Lived Intangible Assets, Gross | [3] | 2,019 | 2,019 |
Accumulated Amortization | [3] | 725 | 658 |
Net carrying amount of finite-lived intangible assets | [3] | $ 1,294 | 1,361 |
Amortization period | 30 years | ||
Amortizable—License agreements (c) | |||
Finite-Lived Intangible Assets [Line Items] | |||
Finite-Lived Intangible Assets, Gross | [4] | $ 45 | 45 |
Accumulated Amortization | [4] | 10 | 9 |
Net carrying amount of finite-lived intangible assets | [4] | $ 35 | 36 |
Amortization period | 50 years | ||
Amortizable—Customer relationships (d) | |||
Finite-Lived Intangible Assets [Line Items] | |||
Finite-Lived Intangible Assets, Gross | [5] | $ 549 | 550 |
Accumulated Amortization | [5] | 335 | 312 |
Net carrying amount of finite-lived intangible assets | [5] | 214 | 238 |
Amortizable—Pendings and listings (f) | |||
Finite-Lived Intangible Assets [Line Items] | |||
Finite-Lived Intangible Assets, Gross | [6] | 2 | 6 |
Accumulated Amortization | [6] | 1 | 5 |
Net carrying amount of finite-lived intangible assets | [6] | $ 1 | 1 |
Amortization period | 5 months | ||
Amortizable—Other (g) | |||
Finite-Lived Intangible Assets [Line Items] | |||
Finite-Lived Intangible Assets, Gross | [7] | $ 33 | 33 |
Accumulated Amortization | [7] | 17 | 13 |
Net carrying amount of finite-lived intangible assets | [7] | $ 16 | $ 20 |
Maximum | Amortizable—Customer relationships (d) | |||
Finite-Lived Intangible Assets [Line Items] | |||
Amortization period | 20 years | ||
Maximum | Amortizable—Other (g) | |||
Finite-Lived Intangible Assets [Line Items] | |||
Amortization period | 10 years | ||
Minimum | Amortizable—Customer relationships (d) | |||
Finite-Lived Intangible Assets [Line Items] | |||
Amortization period | 2 years | ||
Minimum | Amortizable—Other (g) | |||
Finite-Lived Intangible Assets [Line Items] | |||
Amortization period | 5 years | ||
[1] | Primarily relates to the Century 21®, Coldwell Banker®, ERA®, Corcoran®, Coldwell Banker Commercial® and Cartus tradenames, which are expected to generate future cash flows for an indefinite period of time. | ||
[2] | Ownership in a title plant is required to transact title insurance in certain states. The Company expects to generate future cash flows for an indefinite period of time. | ||
[3] | Generally amortized over a period of 30 years. | ||
[4] | Relates to the Sotheby’s International Realty® and Better Homes and Gardens® Real Estate agreements which are being amortized over 50 years (the contractual term of the license agreements). | ||
[5] | Relates to the customer relationships at the Relocation Services segment, the Title and Settlement Services segment, the Real Estate Franchise Services segment and our Company Owned Real Estate Brokerage Services segment. These relationships are being amortized over a period of 2 to 20 years. | ||
[6] | Generally amortized over a period of 5 months. | ||
[7] | Consists of covenants not to compete which are amortized over their contract lives and other intangibles which are generally amortized over periods ranging from 5 to 10 years. |
Note 4. Intangible Assets Amort
Note 4. Intangible Assets Amortization Expense (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Schedule of Finite-Lived Intangible Assets, Amortization Expense [Line Items] | |||
Amortization of Intangible Assets | $ 102 | $ 113 | $ 117 |
Expected amortization expense for 2018 | 98 | ||
Expected amortization expense for 2019 | 97 | ||
Expected amortization expense for 2020 | 95 | ||
Expected amortization expense for 2021 | 93 | ||
Expected amortization expense for 2022 | 92 | ||
Expected amortization expense thereafter | 1,085 | ||
Amortizable—Franchise agreements (a) | |||
Schedule of Finite-Lived Intangible Assets, Amortization Expense [Line Items] | |||
Amortization of Intangible Assets | 67 | 67 | 67 |
Amortizable—License agreements (c) | |||
Schedule of Finite-Lived Intangible Assets, Amortization Expense [Line Items] | |||
Amortization of Intangible Assets | 1 | 1 | 1 |
Amortizable—Customer relationships (d) | |||
Schedule of Finite-Lived Intangible Assets, Amortization Expense [Line Items] | |||
Amortization of Intangible Assets | 25 | 28 | 28 |
Amortizable—Pendings and listings (f) | |||
Schedule of Finite-Lived Intangible Assets, Amortization Expense [Line Items] | |||
Amortization of Intangible Assets | 4 | 12 | 16 |
Amortizable—Other (g) | |||
Schedule of Finite-Lived Intangible Assets, Amortization Expense [Line Items] | |||
Amortization of Intangible Assets | $ 5 | $ 5 | $ 5 |
Note 5. Franchising and Marke55
Note 5. Franchising and Marketing Activities Franchising and Marketing Activities (Details) $ in Millions | 12 Months Ended | ||||
Dec. 31, 2017USD ($)Brokerage_Offices | Dec. 31, 2016USD ($)franchisedandcompanyownedoffices | Dec. 31, 2015USD ($)franchisedandcompanyownedoffices | Dec. 31, 2017franchisedandcompanyownedoffices | Dec. 31, 2014franchisedandcompanyownedoffices | |
Franchisor Disclosure [Line Items] | |||||
Initial franchise and area development fees | $ | $ 8 | $ 8 | $ 8 | ||
Annual volume incentives from Real Estate Franchisees | $ | 62 | 56 | 51 | ||
Brand Marketing Fund Revenue | $ | 87 | $ 83 | $ 83 | ||
Franchised: | |||||
Franchisor Disclosure [Line Items] | |||||
Number of offices | 13,314 | 12,771 | 14,039 | 12,769 | |
Franchised: | Century 21® | |||||
Franchisor Disclosure [Line Items] | |||||
Number of offices | 7,330 | 6,897 | 7,973 | ||
Franchised: | ERA® | |||||
Franchisor Disclosure [Line Items] | |||||
Number of offices | 2,347 | 2,355 | 2,298 | ||
Franchised: | Coldwell Banker® | |||||
Franchisor Disclosure [Line Items] | |||||
Number of offices | 2,289 | 2,258 | 2,330 | ||
Franchised: | Coldwell Banker Commercial® | |||||
Franchisor Disclosure [Line Items] | |||||
Number of offices | 180 | 163 | 180 | ||
Franchised: | Sotheby’s International Realty® | |||||
Franchisor Disclosure [Line Items] | |||||
Number of offices | 836 | 794 | 905 | ||
Franchised: | Better Homes and Gardens® Real Estate | |||||
Franchisor Disclosure [Line Items] | |||||
Number of offices | 332 | 304 | 353 | ||
Company Owned: | |||||
Franchisor Disclosure [Line Items] | |||||
Royalty expense | $ | 299 | $ 282 | $ 284 | ||
Marketing and Advertising Expense | $ | $ 12 | $ 11 | $ 11 | ||
Number of offices | 790 | 789 | 787 | 789 | 727 |
Company Owned: | Coldwell Banker® | |||||
Franchisor Disclosure [Line Items] | |||||
Number of offices | 708 | 708 | 707 | ||
Company Owned: | Sotheby’s International Realty® | |||||
Franchisor Disclosure [Line Items] | |||||
Number of offices | 41 | 41 | 41 | ||
Company Owned: | Corcoran Other | |||||
Franchisor Disclosure [Line Items] | |||||
Number of offices | 40 | 38 | 41 |
Note 5. Franchising and Marke56
Note 5. Franchising and Marketing Activities Change in the Number of Franchised and Company Owned Outlets (Details) $ in Millions | 12 Months Ended | ||||
Dec. 31, 2017USD ($) | Dec. 31, 2017USD ($)Brokerage_Offices | Dec. 31, 2017USD ($)franchisedandcompanyownedoffices | Dec. 31, 2016USD ($)franchisedandcompanyownedoffices | Dec. 31, 2015USD ($)franchisedandcompanyownedoffices | |
Franchised: | |||||
Change in Number of Franchised and Company Owned Outlets [Roll Forward] | |||||
Beginning balance | 13,314 | 12,771 | 12,769 | ||
Additions | 1,137 | 847 | 445 | ||
Terminations/Closures | (412) | (304) | (443) | ||
Ending balance | 14,039 | 13,314 | 12,771 | ||
Company Owned: | |||||
Change in Number of Franchised and Company Owned Outlets [Roll Forward] | |||||
Beginning balance | 789 | 787 | 727 | ||
Additions | 20 | 38 | 74 | ||
Terminations/Closures | (20) | (36) | (14) | ||
Ending balance | 790 | 789 | 789 | 787 | |
Franchisee Conversion Notes and Development Advance Notes | |||||
Change in Number of Franchised and Company Owned Outlets [Roll Forward] | |||||
Franchise conversion and development advance notes | $ | $ 124 | $ 124 | $ 124 | $ 123 | |
Allowance for franchise conversion and development advance notes | $ | 1 | $ 1 | $ 1 | 1 | |
Forgiveness of franchise conversion and development advance notes | $ | $ 25 | $ 24 | $ 22 |
Note 6. Property and Equipmen57
Note 6. Property and Equipment, Net Property and Equipment, Net (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Property, Plant and Equipment [Line Items] | |||
Property and equipment, gross | $ 915 | $ 843 | |
Less: accumulated depreciation | (626) | (576) | |
Property and equipment, net | 289 | 267 | $ 254 |
Depreciation and amortization expense | 96 | 89 | $ 84 |
Furniture, fixtures and equipment | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment, gross | 281 | 254 | |
Capitalized software | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment, gross | 366 | 351 | |
Building and leasehold improvements | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment, gross | 265 | 235 | |
Land | |||
Property, Plant and Equipment [Line Items] | |||
Property and equipment, gross | $ 3 | $ 3 |
Note 7. Accrued Expenses And 58
Note 7. Accrued Expenses And Other Current Liabilities Accrued Expenses And Other Current Liabilities (Details) - USD ($) $ in Millions | Dec. 31, 2017 | Dec. 31, 2016 |
Payables and Accruals [Abstract] | ||
Accrued payroll and related employee costs | $ 140 | $ 138 |
Accrued volume incentives | 41 | 40 |
Accrued commissions | 38 | 31 |
Restructuring accruals | 5 | 14 |
Deferred income | 68 | 69 |
Accrued interest | 13 | 13 |
Contingent consideration for acquisitions | 26 | 24 |
Due to former parent | 18 | 28 |
Other | 129 | 106 |
Total accrued expenses and other current liabilities | $ 478 | $ 463 |
Note 8. Short And Long-Term D59
Note 8. Short And Long-Term Debt Schedule of Total Indebtedness (Details) - USD ($) $ in Millions | Dec. 31, 2017 | Dec. 31, 2016 | ||
Schedule of Long-term and Short-term Debt Instruments [Line Items] | ||||
Long-term Debt | [1] | $ 3,542 | ||
Total Short-Term & Long-Term Debt | 3,348 | $ 3,507 | ||
Securitization obligations | 194 | 205 | ||
Line of Credit | Revolving Credit Facility | ||||
Schedule of Long-term and Short-term Debt Instruments [Line Items] | ||||
Long-term Line of Credit | 70 | [2],[3] | 200 | |
Securitization obligations | ||||
Schedule of Long-term and Short-term Debt Instruments [Line Items] | ||||
Securitization obligations | 194 | 205 | ||
Securitization obligations | Apple Ridge Funding LLC | ||||
Schedule of Long-term and Short-term Debt Instruments [Line Items] | ||||
Securitization obligations | 181 | [4],[5] | 192 | |
Securitization obligations | Cartus Financing Limited | ||||
Schedule of Long-term and Short-term Debt Instruments [Line Items] | ||||
Securitization obligations | 13 | [4],[6] | 13 | |
Secured Debt | Term Loan B | ||||
Schedule of Long-term and Short-term Debt Instruments [Line Items] | ||||
Long-term Debt | 1,063 | [7] | 1,069 | |
Secured Debt | Term Loan A | ||||
Schedule of Long-term and Short-term Debt Instruments [Line Items] | ||||
Long-term Debt | 390 | [8] | 411 | |
Secured Debt | Term Loan A-1 | ||||
Schedule of Long-term and Short-term Debt Instruments [Line Items] | ||||
Long-term Debt | 339 | [9] | 347 | |
Senior Notes | 4.50% Senior Notes | ||||
Schedule of Long-term and Short-term Debt Instruments [Line Items] | ||||
Long-term Debt | 444 | 439 | ||
Senior Notes | 5.25% Senior Notes | ||||
Schedule of Long-term and Short-term Debt Instruments [Line Items] | ||||
Long-term Debt | 546 | 545 | ||
Senior Notes | 4.875% Senior Notes | ||||
Schedule of Long-term and Short-term Debt Instruments [Line Items] | ||||
Long-term Debt | $ 496 | $ 496 | ||
[1] | Not included in this table is the Company's Unsecured Letter of Credit Facility which had a capacity of $74 million with $69 million utilized at a weighted average rate of 3.24% at December 31, 2017. | |||
[2] | As of December 31, 2017, the Company had $1,050 million of borrowing capacity under its Revolving Credit Facility, leaving $980 million of available capacity. The Revolving Credit Facility expires in October 2020, but is classified on the balance sheet as current due to the revolving nature of the facility. On February 23, 2018, the Company had $242 million in outstanding borrowings under the New Revolving Credit Facility, leaving $1,158 million of available capacity. See Note 19, "Subsequent Events" for a description of the February 2018 refinancing. | |||
[3] | Interest rates with respect to revolving loans under the Senior Secured Credit Facility at December 31, 2017 were based on, at the Company's option, (a) adjusted LIBOR plus an additional margin or (b) ABR plus an additional margin, in each case subject to adjustment based on the then current senior secured leverage ratio. Based on the previous quarter senior secured leverage ratio, the LIBOR margin was 2.00% and the ABR margin was 1.00% for the three months ended December 31, 2017. | |||
[4] | Available capacity is subject to maintaining sufficient relocation related assets to collateralize these securitization obligations. | |||
[5] | In November 2017, the capacity of the Apple Ridge facility was reduced from $325 million to $250 million. As of December 31, 2017, the Company had $250 million of borrowing capacity under the Apple Ridge Funding LLC securitization program leaving $69 million of available capacity. | |||
[6] | Consists of a £10 million revolving loan facility and a £5 million working capital facility. As of December 31, 2017, the Company had $20 million of borrowing capacity under the Cartus Financing Limited securitization program leaving $7 million of available capacity. | |||
[7] | The Term Loan B provided for quarterly amortization payments totaling 1% per annum of the original principal amount. The interest rate with respect to term loans under the Term Loan B was based on, at the Company’s option, (a) adjusted LIBOR plus 2.25% (with a LIBOR floor of 0.75%) or (b) JPMorgan Chase Bank, N.A.’s prime rate ("ABR") plus 1.25% (with an ABR floor of 1.75%). See Note 19, "Subsequent Events" for a description of the February 2018 refinancing. | |||
[8] | The Term Loan A provided for quarterly amortization payments, which commenced March 31, 2016, totaling per annum 5%, 5%, 7.5%, 10.0% and 12.5% of the original principal amount of the Term Loan A in 2016, 2017, 2018, 2019 and 2020, respectively. The interest rates with respect to term loans under the Term Loan A were based on, at the Company's option, (a) adjusted LIBOR plus an additional margin or (b) ABR plus an additional margin, in each case subject to adjustment based on the then current senior secured leverage ratio. Based on the previous quarter senior secured leverage ratio, the LIBOR margin was 2.00% and the ABR margin was 1.00% for the three months ended December 31, 2017. See Note 19, "Subsequent Events" for a description of the February 2018 refinancing. | |||
[9] | The Term Loan A-1 provided for quarterly amortization payments, which commenced on September 30, 2016, totaling per annum 2.5%, 2.5%, 5%, 7.5% and 10.0% of the original principal amount of the Term Loan A-1, with the last amortization payment made on June 30, 2021. The interest rates with respect to term loans under the Term Loan A-1 were based on, at the Company's option, (a) adjusted LIBOR plus an additional margin or (b) ABR plus an additional margin, in each case subject to adjustment based on the then current senior secured leverage ratio. Based on the previous quarter senior secured leverage ratio, the LIBOR margin was 2.00% and the ABR margin was 1.00% for the three months ended December 31, 2017. See Note 19, "Subsequent Events" for a description of the February 2018 refinancing. |
Note 8. Short And Long-Term D60
Note 8. Short And Long-Term Debt Schedule of Debt (Details) - USD ($) $ in Millions | 12 Months Ended | |||||||||
Dec. 31, 2017 | Feb. 28, 2018 | Feb. 23, 2018 | Nov. 01, 2017 | Jan. 31, 2017 | Dec. 31, 2016 | Jul. 20, 2016 | Oct. 23, 2015 | |||
Principal Amount | ||||||||||
Long-term Debt, Gross | [1] | $ 3,580 | ||||||||
Outstanding borrowings, securitization obligations | 194 | $ 205 | ||||||||
Unamortized Discount and Debt Issuance Costs | ||||||||||
Debt Instrument, Unamortized Discount (Premium) and Debt Issuance Costs, Net | [1] | 38 | ||||||||
Net Amount | ||||||||||
Outstanding borrowings, long-term debt | [1] | 3,542 | ||||||||
Outstanding borrowings, securitization obligations | 194 | 205 | ||||||||
Letter of Credit, borrowing capacity | $ 125 | |||||||||
Unsecured Letter of Credit Facility [Member] | ||||||||||
Net Amount | ||||||||||
Interest Rate | 3.24% | |||||||||
Letter of Credit, borrowing capacity | $ 74 | 131 | ||||||||
Outstanding letter of credit | $ 69 | 127 | ||||||||
LIBOR | ||||||||||
Net Amount | ||||||||||
Description of variable interest rate basis | LIBOR | |||||||||
ABR | ||||||||||
Net Amount | ||||||||||
Description of variable interest rate basis | ABR | |||||||||
Securitization obligations | ||||||||||
Principal Amount | ||||||||||
Outstanding borrowings, securitization obligations | $ 194 | 205 | ||||||||
Net Amount | ||||||||||
Outstanding borrowings, securitization obligations | 194 | 205 | ||||||||
Revolving Credit Facility | Line of Credit | ||||||||||
Principal Amount | ||||||||||
Outstanding borrowings, short-term debt, line of credit facility | 70 | [2],[3] | 200 | |||||||
Net Amount | ||||||||||
Outstanding borrowings, short-term debt, line of credit facility | 70 | [2],[3] | 200 | |||||||
Line of credit facility borrowing capacity | 1,050 | $ 1,050 | $ 815 | |||||||
Available capacity, line or credit facility | $ 980 | |||||||||
Revolving Credit Facility | Line of Credit | LIBOR | Less than 2.50 to 1.00 | ||||||||||
Net Amount | ||||||||||
Debt Instrument, basis spread on variable rate | 2.00% | |||||||||
Revolving Credit Facility | Line of Credit | ABR | Less than 2.50 to 1.00 | ||||||||||
Net Amount | ||||||||||
Debt Instrument, basis spread on variable rate | 1.00% | |||||||||
Revolving Credit Facility | Line of Credit | Subsequent Event | ||||||||||
Principal Amount | ||||||||||
Outstanding borrowings, short-term debt, line of credit facility | $ 242 | |||||||||
Net Amount | ||||||||||
Outstanding borrowings, short-term debt, line of credit facility | 242 | |||||||||
Line of credit facility borrowing capacity | $ 1,400 | |||||||||
Available capacity, line or credit facility | $ 1,158 | |||||||||
Term Loan B | LIBOR | ||||||||||
Net Amount | ||||||||||
Debt Instrument, basis spread on variable rate | 2.25% | |||||||||
Debt Instrument, basis spread on variable rate, floor | 0.75% | |||||||||
Term Loan B | ABR | ||||||||||
Net Amount | ||||||||||
Debt Instrument, basis spread on variable rate | 1.25% | |||||||||
Debt Instrument, basis spread on variable rate, floor | 1.75% | |||||||||
Term Loan B | Secured Debt | ||||||||||
Principal Amount | ||||||||||
Long-term Debt, Gross | $ 1,083 | [4] | 1,094 | $ 1,100 | ||||||
Unamortized Discount and Debt Issuance Costs | ||||||||||
Debt Instrument, Unamortized Discount (Premium) and Debt Issuance Costs, Net | [4] | 20 | ||||||||
Net Amount | ||||||||||
Outstanding borrowings, long-term debt | $ 1,063 | [4] | 1,069 | |||||||
Annual percentage of original principal amount for quarterly amortization payments | 1.00% | |||||||||
Term Loan B | Secured Debt | Subsequent Event | ||||||||||
Principal Amount | ||||||||||
Long-term Debt, Gross | [4] | 1,080 | ||||||||
Term Loan A | Secured Debt | ||||||||||
Principal Amount | ||||||||||
Long-term Debt, Gross | $ 391 | [5] | 413 | $ 435 | ||||||
Unamortized Discount and Debt Issuance Costs | ||||||||||
Debt Instrument, Unamortized Discount (Premium) and Debt Issuance Costs, Net | [5] | 1 | ||||||||
Net Amount | ||||||||||
Outstanding borrowings, long-term debt | $ 390 | [5] | 411 | |||||||
Term Loan A | Secured Debt | LIBOR | Less than 2.50 to 1.00 | ||||||||||
Net Amount | ||||||||||
Debt Instrument, basis spread on variable rate | 2.00% | |||||||||
Term Loan A | Secured Debt | ABR | Less than 2.50 to 1.00 | ||||||||||
Net Amount | ||||||||||
Debt Instrument, basis spread on variable rate | 1.00% | |||||||||
Term Loan A | Secured Debt | 2016 | ||||||||||
Net Amount | ||||||||||
Annual percentage of original principal amount for quarterly amortization payments | 5.00% | |||||||||
Term Loan A | Secured Debt | 2017 | ||||||||||
Net Amount | ||||||||||
Annual percentage of original principal amount for quarterly amortization payments | 5.00% | |||||||||
Term Loan A | Secured Debt | 2018 | ||||||||||
Net Amount | ||||||||||
Annual percentage of original principal amount for quarterly amortization payments | 7.50% | |||||||||
Term Loan A | Secured Debt | 2019 | ||||||||||
Net Amount | ||||||||||
Annual percentage of original principal amount for quarterly amortization payments | 10.00% | |||||||||
Term Loan A | Secured Debt | 2020 | ||||||||||
Net Amount | ||||||||||
Annual percentage of original principal amount for quarterly amortization payments | 12.50% | |||||||||
Term Loan A | Secured Debt | Subsequent Event | ||||||||||
Principal Amount | ||||||||||
Long-term Debt, Gross | [4] | $ 750 | ||||||||
Term Loan A | Secured Debt | Subsequent Event | 2019 | ||||||||||
Net Amount | ||||||||||
Annual percentage of original principal amount for quarterly amortization payments | 2.50% | |||||||||
Term Loan A | Secured Debt | Subsequent Event | 2020 | ||||||||||
Net Amount | ||||||||||
Annual percentage of original principal amount for quarterly amortization payments | 2.50% | |||||||||
Term Loan A | Secured Debt | Subsequent Event | 2021 | ||||||||||
Net Amount | ||||||||||
Annual percentage of original principal amount for quarterly amortization payments | 5.00% | |||||||||
Term Loan A-1 | Secured Debt | ||||||||||
Principal Amount | ||||||||||
Long-term Debt, Gross | $ 342 | [6] | 351 | $ 355 | ||||||
Unamortized Discount and Debt Issuance Costs | ||||||||||
Debt Instrument, Unamortized Discount (Premium) and Debt Issuance Costs, Net | [6] | 3 | ||||||||
Net Amount | ||||||||||
Outstanding borrowings, long-term debt | $ 339 | [6] | 347 | |||||||
Term Loan A-1 | Secured Debt | LIBOR | Less than 2.50 to 1.00 but greater than or equal to 2.00 to 1.00 | ||||||||||
Net Amount | ||||||||||
Debt Instrument, basis spread on variable rate | 2.00% | |||||||||
Term Loan A-1 | Secured Debt | ABR | Less than 2.50 to 1.00 but greater than or equal to 2.00 to 1.00 | ||||||||||
Net Amount | ||||||||||
Debt Instrument, basis spread on variable rate | 1.00% | |||||||||
Term Loan A-1 | Secured Debt | 2017 | ||||||||||
Net Amount | ||||||||||
Annual percentage of original principal amount for quarterly amortization payments | 2.50% | |||||||||
Term Loan A-1 | Secured Debt | 2018 | ||||||||||
Net Amount | ||||||||||
Annual percentage of original principal amount for quarterly amortization payments | 2.50% | |||||||||
Term Loan A-1 | Secured Debt | 2019 | ||||||||||
Net Amount | ||||||||||
Annual percentage of original principal amount for quarterly amortization payments | 5.00% | |||||||||
Term Loan A-1 | Secured Debt | 2020 | ||||||||||
Net Amount | ||||||||||
Annual percentage of original principal amount for quarterly amortization payments | 7.50% | |||||||||
Term Loan A-1 | Secured Debt | 2021 | ||||||||||
Net Amount | ||||||||||
Annual percentage of original principal amount for quarterly amortization payments | 10.00% | |||||||||
4.50% Senior Notes | Senior Notes | ||||||||||
Principal Amount | ||||||||||
Long-term Debt, Gross | $ 450 | 450 | ||||||||
Unamortized Discount and Debt Issuance Costs | ||||||||||
Debt Instrument, Unamortized Discount (Premium) and Debt Issuance Costs, Net | 6 | |||||||||
Net Amount | ||||||||||
Outstanding borrowings, long-term debt | $ 444 | 439 | ||||||||
Interest Rate | 4.50% | |||||||||
5.25% Senior Notes | Senior Notes | ||||||||||
Principal Amount | ||||||||||
Long-term Debt, Gross | $ 550 | 550 | ||||||||
Unamortized Discount and Debt Issuance Costs | ||||||||||
Debt Instrument, Unamortized Discount (Premium) and Debt Issuance Costs, Net | 4 | |||||||||
Net Amount | ||||||||||
Outstanding borrowings, long-term debt | $ 546 | 545 | ||||||||
Interest Rate | 5.25% | |||||||||
4.875% Senior Notes | Senior Notes | ||||||||||
Principal Amount | ||||||||||
Long-term Debt, Gross | $ 500 | 500 | ||||||||
Unamortized Discount and Debt Issuance Costs | ||||||||||
Debt Instrument, Unamortized Discount (Premium) and Debt Issuance Costs, Net | 4 | |||||||||
Net Amount | ||||||||||
Outstanding borrowings, long-term debt | $ 496 | 496 | ||||||||
Interest Rate | 4.875% | |||||||||
Apple Ridge Funding LLC | Securitization obligations | ||||||||||
Principal Amount | ||||||||||
Outstanding borrowings, securitization obligations | $ 181 | [7],[8] | 192 | |||||||
Net Amount | ||||||||||
Outstanding borrowings, securitization obligations | 181 | [7],[8] | 192 | |||||||
Total capacity, securitization obligations | 250 | $ 325 | ||||||||
Available capacity, debt | 69 | |||||||||
Cartus Financing Limited | Securitization obligations | ||||||||||
Principal Amount | ||||||||||
Outstanding borrowings, securitization obligations | 13 | [7],[9] | 13 | |||||||
Net Amount | ||||||||||
Outstanding borrowings, securitization obligations | 13 | [7],[9] | $ 13 | |||||||
Total capacity, securitization obligations | 20 | |||||||||
Available capacity, debt | $ 7 | |||||||||
[1] | Not included in this table is the Company's Unsecured Letter of Credit Facility which had a capacity of $74 million with $69 million utilized at a weighted average rate of 3.24% at December 31, 2017. | |||||||||
[2] | As of December 31, 2017, the Company had $1,050 million of borrowing capacity under its Revolving Credit Facility, leaving $980 million of available capacity. The Revolving Credit Facility expires in October 2020, but is classified on the balance sheet as current due to the revolving nature of the facility. On February 23, 2018, the Company had $242 million in outstanding borrowings under the New Revolving Credit Facility, leaving $1,158 million of available capacity. See Note 19, "Subsequent Events" for a description of the February 2018 refinancing. | |||||||||
[3] | Interest rates with respect to revolving loans under the Senior Secured Credit Facility at December 31, 2017 were based on, at the Company's option, (a) adjusted LIBOR plus an additional margin or (b) ABR plus an additional margin, in each case subject to adjustment based on the then current senior secured leverage ratio. Based on the previous quarter senior secured leverage ratio, the LIBOR margin was 2.00% and the ABR margin was 1.00% for the three months ended December 31, 2017. | |||||||||
[4] | The Term Loan B provided for quarterly amortization payments totaling 1% per annum of the original principal amount. The interest rate with respect to term loans under the Term Loan B was based on, at the Company’s option, (a) adjusted LIBOR plus 2.25% (with a LIBOR floor of 0.75%) or (b) JPMorgan Chase Bank, N.A.’s prime rate ("ABR") plus 1.25% (with an ABR floor of 1.75%). See Note 19, "Subsequent Events" for a description of the February 2018 refinancing. | |||||||||
[5] | The Term Loan A provided for quarterly amortization payments, which commenced March 31, 2016, totaling per annum 5%, 5%, 7.5%, 10.0% and 12.5% of the original principal amount of the Term Loan A in 2016, 2017, 2018, 2019 and 2020, respectively. The interest rates with respect to term loans under the Term Loan A were based on, at the Company's option, (a) adjusted LIBOR plus an additional margin or (b) ABR plus an additional margin, in each case subject to adjustment based on the then current senior secured leverage ratio. Based on the previous quarter senior secured leverage ratio, the LIBOR margin was 2.00% and the ABR margin was 1.00% for the three months ended December 31, 2017. See Note 19, "Subsequent Events" for a description of the February 2018 refinancing. | |||||||||
[6] | The Term Loan A-1 provided for quarterly amortization payments, which commenced on September 30, 2016, totaling per annum 2.5%, 2.5%, 5%, 7.5% and 10.0% of the original principal amount of the Term Loan A-1, with the last amortization payment made on June 30, 2021. The interest rates with respect to term loans under the Term Loan A-1 were based on, at the Company's option, (a) adjusted LIBOR plus an additional margin or (b) ABR plus an additional margin, in each case subject to adjustment based on the then current senior secured leverage ratio. Based on the previous quarter senior secured leverage ratio, the LIBOR margin was 2.00% and the ABR margin was 1.00% for the three months ended December 31, 2017. See Note 19, "Subsequent Events" for a description of the February 2018 refinancing. | |||||||||
[7] | Available capacity is subject to maintaining sufficient relocation related assets to collateralize these securitization obligations. | |||||||||
[8] | In November 2017, the capacity of the Apple Ridge facility was reduced from $325 million to $250 million. As of December 31, 2017, the Company had $250 million of borrowing capacity under the Apple Ridge Funding LLC securitization program leaving $69 million of available capacity. | |||||||||
[9] | Consists of a £10 million revolving loan facility and a £5 million working capital facility. As of December 31, 2017, the Company had $20 million of borrowing capacity under the Cartus Financing Limited securitization program leaving $7 million of available capacity. |
Note 8. Short And Long-Term D61
Note 8. Short And Long-Term Debt Debt Maturities Table (Details) - USD ($) $ in Millions | 12 Months Ended | ||||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |||
Maturities of Long-term Debt [Abstract] | |||||
2018 (a) | [1] | $ 127 | |||
2,019 | 527 | ||||
2,020 | 356 | ||||
2,021 | 837 | ||||
2,022 | $ 1,039 | ||||
Long-term Debt Maturities, Years Presented | 5 years | ||||
Revolving Credit Facility | Line of Credit | |||||
Maturities of Long-term Debt [Abstract] | |||||
Long-term Line of Credit | $ 70 | [2],[3] | $ 200 | ||
Scenario, Forecast [Member] | Secured Debt | Term Loan A | |||||
Maturities of Long-term Debt [Abstract] | |||||
Debt Instrument, Periodic Payment, Principal | $ 33 | ||||
Scenario, Forecast [Member] | Secured Debt | Term Loan A-1 | |||||
Maturities of Long-term Debt [Abstract] | |||||
Debt Instrument, Periodic Payment, Principal | 13 | ||||
Scenario, Forecast [Member] | Secured Debt | Term Loan B | |||||
Maturities of Long-term Debt [Abstract] | |||||
Debt Instrument, Periodic Payment, Principal | $ 11 | ||||
[1] | The current portion of long-term debt consists of four quarters of 2018 amortization payments totaling $33 million, $13 million and $11 million for the Term Loan A, Term Loan A-1 and Term Loan B facilities, respectively, as well as $70 million of revolver borrowings under the revolving credit facility which expires in October 2020, but are classified on the balance sheet as current due to the revolving nature of the facility. See Note 19, "Subsequent Events" for a description of the February 2018 refinancing. | ||||
[2] | As of December 31, 2017, the Company had $1,050 million of borrowing capacity under its Revolving Credit Facility, leaving $980 million of available capacity. The Revolving Credit Facility expires in October 2020, but is classified on the balance sheet as current due to the revolving nature of the facility. On February 23, 2018, the Company had $242 million in outstanding borrowings under the New Revolving Credit Facility, leaving $1,158 million of available capacity. See Note 19, "Subsequent Events" for a description of the February 2018 refinancing. | ||||
[3] | Interest rates with respect to revolving loans under the Senior Secured Credit Facility at December 31, 2017 were based on, at the Company's option, (a) adjusted LIBOR plus an additional margin or (b) ABR plus an additional margin, in each case subject to adjustment based on the then current senior secured leverage ratio. Based on the previous quarter senior secured leverage ratio, the LIBOR margin was 2.00% and the ABR margin was 1.00% for the three months ended December 31, 2017. |
Note 8. Short And Long-Term D62
Note 8. Short And Long-Term Debt Senior Secured Credit Facility (Details) - USD ($) $ in Millions | 12 Months Ended | ||||||||
Dec. 31, 2017 | Feb. 28, 2018 | Jan. 31, 2017 | Dec. 31, 2016 | Jul. 20, 2016 | Oct. 23, 2015 | Mar. 05, 2013 | |||
Debt Instrument [Line Items] | |||||||||
Long-term Debt, Gross | [1] | $ 3,580 | |||||||
Letter of Credit, borrowing capacity | $ 125 | ||||||||
Additional Credit Facilities | $ 500 | ||||||||
Maximum | Required Covenant Ratio to Receive Additional Credit Facilities | |||||||||
Debt Instrument [Line Items] | |||||||||
Senior secured leverage ratio | 3.50 | ||||||||
Ratio of Indebtedness to Net Capital Denominator | 1 | ||||||||
Maximum | Required Covenant Ratio | |||||||||
Debt Instrument [Line Items] | |||||||||
Senior secured leverage ratio | 4.75 | ||||||||
Ratio of Indebtedness to Net Capital Denominator | 1 | ||||||||
LIBOR | |||||||||
Debt Instrument [Line Items] | |||||||||
Description of variable interest rate basis | LIBOR | ||||||||
ABR | |||||||||
Debt Instrument [Line Items] | |||||||||
Description of variable interest rate basis | ABR | ||||||||
Term Loan B | LIBOR | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt Instrument, basis spread on variable rate | 2.25% | ||||||||
Debt Instrument, basis spread on variable rate, floor | 0.75% | ||||||||
Term Loan B | ABR | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt Instrument, basis spread on variable rate | 1.25% | ||||||||
Debt Instrument, basis spread on variable rate, floor | 1.75% | ||||||||
Line of Credit | Revolving Credit Facility | |||||||||
Debt Instrument [Line Items] | |||||||||
Line of credit facility borrowing capacity | $ 1,050 | $ 1,050 | $ 815 | ||||||
Line of Credit | Revolving Credit Facility | Greater than 3.50 to 1.00 | LIBOR | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt Instrument, basis spread on variable rate | 2.50% | ||||||||
Line of Credit | Revolving Credit Facility | Greater than 3.50 to 1.00 | ABR | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt Instrument, basis spread on variable rate | 1.50% | ||||||||
Line of Credit | Revolving Credit Facility | Less than or equal to 3.50 to 1.00 but greater than or equal to 2.50 to 1.00 | LIBOR | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt Instrument, basis spread on variable rate | 2.25% | ||||||||
Line of Credit | Revolving Credit Facility | Less than or equal to 3.50 to 1.00 but greater than or equal to 2.50 to 1.00 | ABR | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt Instrument, basis spread on variable rate | 1.25% | ||||||||
Line of Credit | Revolving Credit Facility | Less than 2.50 to 1.00 | LIBOR | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt Instrument, basis spread on variable rate | 2.00% | ||||||||
Line of Credit | Revolving Credit Facility | Less than 2.50 to 1.00 | ABR | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt Instrument, basis spread on variable rate | 1.00% | ||||||||
Secured Debt | Term Loan B | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt Instrument, Repurchase Amount | $ 1,858 | ||||||||
Long-term Debt, Gross | $ 1,083 | [2] | $ 1,094 | $ 1,100 | |||||
Annual percentage of original principal amount for quarterly amortization payments | 1.00% | ||||||||
Secured Debt | Term Loan A | |||||||||
Debt Instrument [Line Items] | |||||||||
Long-term Debt, Gross | $ 391 | [3] | $ 413 | 435 | |||||
Additional Credit Facilities | $ 500 | ||||||||
Secured Debt | Term Loan A | Greater than 3.50 to 1.00 | LIBOR | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt Instrument, basis spread on variable rate | 2.50% | ||||||||
Secured Debt | Term Loan A | Greater than 3.50 to 1.00 | ABR | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt Instrument, basis spread on variable rate | 1.50% | ||||||||
Secured Debt | Term Loan A | Less than or equal to 3.50 to 1.00 but greater than or equal to 2.50 to 1.00 | LIBOR | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt Instrument, basis spread on variable rate | 2.25% | ||||||||
Secured Debt | Term Loan A | Less than or equal to 3.50 to 1.00 but greater than or equal to 2.50 to 1.00 | ABR | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt Instrument, basis spread on variable rate | 1.25% | ||||||||
Secured Debt | Term Loan A | Less than 2.50 to 1.00 | LIBOR | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt Instrument, basis spread on variable rate | 2.00% | ||||||||
Secured Debt | Term Loan A | Less than 2.50 to 1.00 | ABR | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt Instrument, basis spread on variable rate | 1.00% | ||||||||
Subsequent Event | Line of Credit | Revolving Credit Facility | |||||||||
Debt Instrument [Line Items] | |||||||||
Line of credit facility borrowing capacity | $ 1,400 | ||||||||
Subsequent Event | Secured Debt | Term Loan B | |||||||||
Debt Instrument [Line Items] | |||||||||
Debt Instrument, Repurchase Amount | 1,083 | ||||||||
Long-term Debt, Gross | [2] | 1,080 | |||||||
Subsequent Event | Secured Debt | Term Loan A | |||||||||
Debt Instrument [Line Items] | |||||||||
Long-term Debt, Gross | [2] | $ 750 | |||||||
[1] | Not included in this table is the Company's Unsecured Letter of Credit Facility which had a capacity of $74 million with $69 million utilized at a weighted average rate of 3.24% at December 31, 2017. | ||||||||
[2] | The Term Loan B provided for quarterly amortization payments totaling 1% per annum of the original principal amount. The interest rate with respect to term loans under the Term Loan B was based on, at the Company’s option, (a) adjusted LIBOR plus 2.25% (with a LIBOR floor of 0.75%) or (b) JPMorgan Chase Bank, N.A.’s prime rate ("ABR") plus 1.25% (with an ABR floor of 1.75%). See Note 19, "Subsequent Events" for a description of the February 2018 refinancing. | ||||||||
[3] | The Term Loan A provided for quarterly amortization payments, which commenced March 31, 2016, totaling per annum 5%, 5%, 7.5%, 10.0% and 12.5% of the original principal amount of the Term Loan A in 2016, 2017, 2018, 2019 and 2020, respectively. The interest rates with respect to term loans under the Term Loan A were based on, at the Company's option, (a) adjusted LIBOR plus an additional margin or (b) ABR plus an additional margin, in each case subject to adjustment based on the then current senior secured leverage ratio. Based on the previous quarter senior secured leverage ratio, the LIBOR margin was 2.00% and the ABR margin was 1.00% for the three months ended December 31, 2017. See Note 19, "Subsequent Events" for a description of the February 2018 refinancing. |
Note 8. Short And Long-Term D63
Note 8. Short And Long-Term Debt Term Loan A Facility (Details) - USD ($) $ in Millions | 12 Months Ended | ||||||
Dec. 31, 2017 | Dec. 31, 2016 | Jul. 20, 2016 | Oct. 23, 2015 | Mar. 05, 2013 | |||
Debt Instrument [Line Items] | |||||||
Long-term Debt, Gross | [1] | $ 3,580 | |||||
Additional Credit Facilities | $ 500 | ||||||
Maximum | Required Covenant Ratio to Receive Additional Credit Facilities | |||||||
Debt Instrument [Line Items] | |||||||
Ratio of Indebtedness to Net Capital | 3.50 | ||||||
Ratio of Indebtedness to Net Capital Denominator | 1 | ||||||
Term Loan A | |||||||
Debt Instrument [Line Items] | |||||||
Debt Maturity | 5 years | ||||||
Secured Debt | Term Loan A | |||||||
Debt Instrument [Line Items] | |||||||
Long-term Debt, Gross | $ 391 | [2] | $ 413 | $ 435 | |||
Additional Credit Facilities | $ 500 | ||||||
Secured Debt | Term Loan A | LIBOR | Greater than 3.50 to 1.00 | |||||||
Debt Instrument [Line Items] | |||||||
Debt Instrument, basis spread on variable rate | 2.50% | ||||||
Secured Debt | Term Loan A | LIBOR | Less than or equal to 3.50 to 1.00 but greater than or equal to 2.50 to 1.00 | |||||||
Debt Instrument [Line Items] | |||||||
Debt Instrument, basis spread on variable rate | 2.25% | ||||||
Secured Debt | Term Loan A | LIBOR | Less than 2.50 to 1.00 | |||||||
Debt Instrument [Line Items] | |||||||
Debt Instrument, basis spread on variable rate | 2.00% | ||||||
Secured Debt | Term Loan A | ABR | Greater than 3.50 to 1.00 | |||||||
Debt Instrument [Line Items] | |||||||
Debt Instrument, basis spread on variable rate | 1.50% | ||||||
Secured Debt | Term Loan A | ABR | Less than or equal to 3.50 to 1.00 but greater than or equal to 2.50 to 1.00 | |||||||
Debt Instrument [Line Items] | |||||||
Debt Instrument, basis spread on variable rate | 1.25% | ||||||
Secured Debt | Term Loan A | ABR | Less than 2.50 to 1.00 | |||||||
Debt Instrument [Line Items] | |||||||
Debt Instrument, basis spread on variable rate | 1.00% | ||||||
Secured Debt | Term Loan A | 2016 | |||||||
Debt Instrument [Line Items] | |||||||
Annual percentage of original principal amount for quarterly amortization payments | 5.00% | ||||||
Secured Debt | Term Loan A | 2017 | |||||||
Debt Instrument [Line Items] | |||||||
Annual percentage of original principal amount for quarterly amortization payments | 5.00% | ||||||
Secured Debt | Term Loan A | 2018 | |||||||
Debt Instrument [Line Items] | |||||||
Annual percentage of original principal amount for quarterly amortization payments | 7.50% | ||||||
Secured Debt | Term Loan A | 2019 | |||||||
Debt Instrument [Line Items] | |||||||
Annual percentage of original principal amount for quarterly amortization payments | 10.00% | ||||||
Secured Debt | Term Loan A | 2020 | |||||||
Debt Instrument [Line Items] | |||||||
Annual percentage of original principal amount for quarterly amortization payments | 12.50% | ||||||
Secured Debt | Term Loan A-1 | |||||||
Debt Instrument [Line Items] | |||||||
Long-term Debt, Gross | $ 342 | [3] | $ 351 | $ 355 | |||
Secured Debt | Term Loan A-1 | LIBOR | Greater than 3.50 to 1.00 | |||||||
Debt Instrument [Line Items] | |||||||
Debt Instrument, basis spread on variable rate | 2.50% | ||||||
Secured Debt | Term Loan A-1 | LIBOR | Less than or equal to 3.50 to 1.00 but greater than or equal to 2.50 to 1.00 | |||||||
Debt Instrument [Line Items] | |||||||
Debt Instrument, basis spread on variable rate | 2.25% | ||||||
Secured Debt | Term Loan A-1 | LIBOR | Less than 2.50 to 1.00 but greater than or equal to 2.00 to 1.00 | |||||||
Debt Instrument [Line Items] | |||||||
Debt Instrument, basis spread on variable rate | 2.00% | ||||||
Secured Debt | Term Loan A-1 | LIBOR | Less than 2.00 to 1.00 | |||||||
Debt Instrument [Line Items] | |||||||
Debt Instrument, basis spread on variable rate | 1.75% | ||||||
Secured Debt | Term Loan A-1 | ABR | Greater than 3.50 to 1.00 | |||||||
Debt Instrument [Line Items] | |||||||
Debt Instrument, basis spread on variable rate | 1.50% | ||||||
Secured Debt | Term Loan A-1 | ABR | Less than or equal to 3.50 to 1.00 but greater than or equal to 2.50 to 1.00 | |||||||
Debt Instrument [Line Items] | |||||||
Debt Instrument, basis spread on variable rate | 1.25% | ||||||
Secured Debt | Term Loan A-1 | ABR | Less than 2.50 to 1.00 but greater than or equal to 2.00 to 1.00 | |||||||
Debt Instrument [Line Items] | |||||||
Debt Instrument, basis spread on variable rate | 1.00% | ||||||
Secured Debt | Term Loan A-1 | ABR | Less than 2.00 to 1.00 | |||||||
Debt Instrument [Line Items] | |||||||
Debt Instrument, basis spread on variable rate | 0.75% | ||||||
Secured Debt | Term Loan A-1 | 2017 | |||||||
Debt Instrument [Line Items] | |||||||
Annual percentage of original principal amount for quarterly amortization payments | 2.50% | ||||||
Secured Debt | Term Loan A-1 | 2018 | |||||||
Debt Instrument [Line Items] | |||||||
Annual percentage of original principal amount for quarterly amortization payments | 2.50% | ||||||
Secured Debt | Term Loan A-1 | 2019 | |||||||
Debt Instrument [Line Items] | |||||||
Annual percentage of original principal amount for quarterly amortization payments | 5.00% | ||||||
Secured Debt | Term Loan A-1 | 2020 | |||||||
Debt Instrument [Line Items] | |||||||
Annual percentage of original principal amount for quarterly amortization payments | 7.50% | ||||||
Secured Debt | Term Loan A-1 | 2021 | |||||||
Debt Instrument [Line Items] | |||||||
Annual percentage of original principal amount for quarterly amortization payments | 10.00% | ||||||
Secured Debt | Term Loan A Facility | Maximum | Required Covenant Ratio to Receive Additional Credit Facilities | |||||||
Debt Instrument [Line Items] | |||||||
Ratio of Indebtedness to Net Capital | 350.00% | ||||||
Ratio of Indebtedness to Net Capital Denominator | 100.00% | ||||||
[1] | Not included in this table is the Company's Unsecured Letter of Credit Facility which had a capacity of $74 million with $69 million utilized at a weighted average rate of 3.24% at December 31, 2017. | ||||||
[2] | The Term Loan A provided for quarterly amortization payments, which commenced March 31, 2016, totaling per annum 5%, 5%, 7.5%, 10.0% and 12.5% of the original principal amount of the Term Loan A in 2016, 2017, 2018, 2019 and 2020, respectively. The interest rates with respect to term loans under the Term Loan A were based on, at the Company's option, (a) adjusted LIBOR plus an additional margin or (b) ABR plus an additional margin, in each case subject to adjustment based on the then current senior secured leverage ratio. Based on the previous quarter senior secured leverage ratio, the LIBOR margin was 2.00% and the ABR margin was 1.00% for the three months ended December 31, 2017. See Note 19, "Subsequent Events" for a description of the February 2018 refinancing. | ||||||
[3] | The Term Loan A-1 provided for quarterly amortization payments, which commenced on September 30, 2016, totaling per annum 2.5%, 2.5%, 5%, 7.5% and 10.0% of the original principal amount of the Term Loan A-1, with the last amortization payment made on June 30, 2021. The interest rates with respect to term loans under the Term Loan A-1 were based on, at the Company's option, (a) adjusted LIBOR plus an additional margin or (b) ABR plus an additional margin, in each case subject to adjustment based on the then current senior secured leverage ratio. Based on the previous quarter senior secured leverage ratio, the LIBOR margin was 2.00% and the ABR margin was 1.00% for the three months ended December 31, 2017. See Note 19, "Subsequent Events" for a description of the February 2018 refinancing. |
Note 8. Short And Long-Term D64
Note 8. Short And Long-Term Debt Unsecured Notes (Details) - Senior Notes | Dec. 31, 2017 |
4.50% Senior Notes | |
Debt Instrument [Line Items] | |
Interest Rate | 4.50% |
5.25% Senior Notes | |
Debt Instrument [Line Items] | |
Interest Rate | 5.25% |
4.875% Senior Notes | |
Debt Instrument [Line Items] | |
Interest Rate | 4.875% |
Note 8. Short And Long-Term D65
Note 8. Short And Long-Term Debt Other Debt Facilities (Details) - USD ($) $ in Millions | Dec. 31, 2017 | Dec. 31, 2016 |
Line of Credit Facility [Line Items] | ||
Letter of Credit, borrowing capacity | $ 125 | |
Unsecured Letter of Credit Facility [Member] | ||
Line of Credit Facility [Line Items] | ||
Letter of Credit, borrowing capacity | 74 | $ 131 |
Outstanding letter of credit | 69 | $ 127 |
Unsecured Letter of Credit Facility [Member] | September 2018 | ||
Line of Credit Facility [Line Items] | ||
Letter of Credit, borrowing capacity | 8 | |
Unsecured Letter of Credit Facility [Member] | December 2019 | ||
Line of Credit Facility [Line Items] | ||
Letter of Credit, borrowing capacity | $ 66 |
Note 8. Short And Long-Term D66
Note 8. Short And Long-Term Debt Securitization Obligations (Details) £ in Millions, $ in Millions | 12 Months Ended | |||||
Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) | Dec. 31, 2017GBP (£) | Dec. 31, 2017USD ($) | Nov. 01, 2017USD ($) | ||
Debt Instrument [Line Items] | ||||||
Securitization obligations | $ 205 | $ 194 | ||||
Securitization obligations | ||||||
Debt Instrument [Line Items] | ||||||
Securitization obligations | 205 | 194 | ||||
Relocation receivables and other related relocation assets that collateralize securitization obligations | 238 | $ 218 | ||||
Interest expense on securitization obligations | $ 7 | $ 6 | ||||
Weighted average interest rate on securitization obligations | 2.60% | 3.30% | 3.30% | |||
Apple Ridge Funding LLC | Securitization obligations | ||||||
Debt Instrument [Line Items] | ||||||
Total capacity, securitization obligations | $ 250 | $ 325 | ||||
Securitization obligations | $ 192 | 181 | [1],[2] | |||
Cartus Financing Limited | Securitization obligations | ||||||
Debt Instrument [Line Items] | ||||||
Total capacity, securitization obligations | 20 | |||||
Securitization obligations | $ 13 | $ 13 | [1],[3] | |||
Cartus Financing Limited | Revolving Credit Facility | Securitization obligations | ||||||
Debt Instrument [Line Items] | ||||||
Total capacity, securitization obligations | £ | £ 10 | |||||
Cartus Financing Limited | Working Capital Facility | Securitization obligations | ||||||
Debt Instrument [Line Items] | ||||||
Total capacity, securitization obligations | £ | £ 5 | |||||
[1] | Available capacity is subject to maintaining sufficient relocation related assets to collateralize these securitization obligations. | |||||
[2] | In November 2017, the capacity of the Apple Ridge facility was reduced from $325 million to $250 million. As of December 31, 2017, the Company had $250 million of borrowing capacity under the Apple Ridge Funding LLC securitization program leaving $69 million of available capacity. | |||||
[3] | Consists of a £10 million revolving loan facility and a £5 million working capital facility. As of December 31, 2017, the Company had $20 million of borrowing capacity under the Cartus Financing Limited securitization program leaving $7 million of available capacity. |
Note 8. Short And Long-Term D67
Note 8. Short And Long-Term Debt Loss on the Early Extinguishment of Debt (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||
Sep. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Debt Disclosure [Abstract] | |||||
Loss on the early extinguishment of debt | $ 1 | $ 4 | $ 5 | $ 0 | $ 48 |
Note 9. Employee Benefit Plan68
Note 9. Employee Benefit Plans Changes in Benefit Obligations and Plan Assets Table (Details) - Defined Benefit Pension Plan - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Net Periodic Benefit Cost | ||
Net periodic pension cost | $ 1 | $ 1 |
Interest cost | 6 | 6 |
Actuarial loss | 2 | 2 |
Expected return on plan assets | (7) | (7) |
Benefit Obligations | ||
Defined Benefit Plan, Benefit Obligation | 145 | 147 |
Fair value of plan assets | 108 | 104 |
Underfunded at end of year | $ 37 | $ 43 |
Note 9. Employee Benefit Plan69
Note 9. Employee Benefit Plans Estimated Future Funding (Details) - Defined Benefit Pension Plan $ in Millions | Dec. 31, 2017USD ($) |
Expected Future Benefit Payments, Fiscal Year Maturity | |
2,018 | $ 9 |
2,019 | 9 |
2,020 | 9 |
2,021 | 10 |
2,022 | 10 |
2023 through 2027 | 47 |
Estimated minimum funding required during 2017 | $ 3 |
Note 9. Employee Benefit Plan70
Note 9. Employee Benefit Plans Fair Value of Plan Assets by Category (Details) - Defined Benefit Pension Plan - USD ($) $ in Millions | Dec. 31, 2017 | Dec. 31, 2016 |
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets | $ 108 | $ 104 |
Cash and cash equivalents | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets | 1 | 1 |
Equity Securities [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets | 71 | 74 |
Bond funds | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets | 36 | 29 |
Fair Value, Inputs, Level 1 [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets | 1 | 1 |
Fair Value, Inputs, Level 1 [Member] | Cash and cash equivalents | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets | 1 | 1 |
Fair Value, Inputs, Level 1 [Member] | Equity Securities [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets | 0 | 0 |
Fair Value, Inputs, Level 1 [Member] | Bond funds | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets | 0 | 0 |
Fair Value, Inputs, Level 2 [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets | 107 | 103 |
Fair Value, Inputs, Level 2 [Member] | Cash and cash equivalents | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets | 0 | 0 |
Fair Value, Inputs, Level 2 [Member] | Equity Securities [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets | 71 | 74 |
Fair Value, Inputs, Level 2 [Member] | Bond funds | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets | 36 | 29 |
Fair Value, Inputs, Level 3 [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets | 0 | 0 |
Fair Value, Inputs, Level 3 [Member] | Cash and cash equivalents | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets | 0 | 0 |
Fair Value, Inputs, Level 3 [Member] | Equity Securities [Member] | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets | 0 | 0 |
Fair Value, Inputs, Level 3 [Member] | Bond funds | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Fair value of plan assets | $ 0 | $ 0 |
Note 9. Employee Benefit Plan71
Note 9. Employee Benefit Plans Other Employee Benefit Plans (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Other Employee Benefit Plans | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Benefit Obligation | $ 6 | $ 6 | |
Defined Contribution Savings Plan [Member] | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Pension and Other Postretirement Benefits Cost (Reversal of Cost) | $ 16 | $ 15 | $ 14 |
Note 10. Income Taxes Pre-tax I
Note 10. Income Taxes Pre-tax Income (Loss) for Domestic and Foreign Operations (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Income Tax Disclosure [Abstract] | |||
Domestic | $ 365 | $ 351 | $ 290 |
Foreign | 4 | 10 | 8 |
Pretax income (loss) | $ 369 | $ 361 | $ 298 |
Note 10. Income Taxes Income 73
Note 10. Income Taxes Income Tax Provision (Details) - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Current: | ||||
Federal | $ (7) | $ 10 | $ 8 | |
State | 4 | 8 | 3 | |
Foreign | 1 | 2 | 3 | |
Current Income Tax Expense (Benefit) | (2) | 20 | 14 | |
Deferred: | ||||
Federal | (72) | 107 | 91 | |
State | 9 | 16 | 4 | |
Foreign | 0 | 1 | 1 | |
Deferred Income Tax Expense (Benefit) | $ (63) | $ 124 | $ 96 | |
Federal statutory rate | 35.00% | 35.00% | 35.00% | |
Income tax (benefit) expense | $ (65) | $ 144 | $ 110 | |
Effective Income Tax Rate Reconciliation, Change in Enacted Tax Rate, Amount | (184) | |||
Unrecognized Tax Benefits, Period Increase (Decrease) | $ (32) | |||
Subsequent Event | ||||
Deferred: | ||||
Federal statutory rate | 21.00% |
Note 10. Income Taxes Reconcili
Note 10. Income Taxes Reconciliation of Effective Tax Rate (Details) | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Effective Income Tax Rate, Continuing Operations, Tax Rate Reconciliation [Abstract] | |||
Federal statutory rate | 35.00% | 35.00% | 35.00% |
State and local income taxes, net of federal tax benefits | 4.00% | 4.00% | 2.00% |
Effective Income Tax Rate Reconciliation, Change in Enacted Tax Rate, Percent | (50.00%) | 0.00% | 0.00% |
Permanent differences | 0.00% | 1.00% | 1.00% |
Effective Income Tax Rate Reconciliation, Uncertain Tax Positions | (9.00%) | 0.00% | 0.00% |
Net change in valuation allowance | 1.00% | 0.00% | 1.00% |
Other | 1.00% | 0.00% | (2.00%) |
Effective income tax rate | (18.00%) | 40.00% | 37.00% |
Note 10. Income Taxes Deferred
Note 10. Income Taxes Deferred Income Tax Assets and Liabilities (Details) - USD ($) $ in Millions | Dec. 31, 2017 | Dec. 31, 2016 |
Deferred income tax assets: | ||
Net operating loss carryforwards | $ 288 | $ 503 |
Tax credit carryforwards | 35 | 41 |
Accrued liabilities and deferred income | 85 | 131 |
Minimum pension obligations | 16 | 23 |
Provision for doubtful accounts | 8 | 16 |
Liability for unrecognized tax benefits | 1 | 3 |
Deferred Tax Assets, Derivative Instruments | 2 | 8 |
Total deferred tax assets | 435 | 725 |
Less: valuation allowance | (13) | (10) |
Total deferred income tax assets after valuation allowance | 422 | 715 |
Deferred income tax liabilities: | ||
Depreciation and amortization | 736 | 1,099 |
Prepaid expenses | 2 | 1 |
Undistributed foreign earnings | 0 | 2 |
Basis difference in investment in joint ventures | 10 | 2 |
Total deferred tax liabilities | 748 | 1,104 |
Net deferred income tax liabilities | (326) | (389) |
Deferred Tax Assets, Net, Classification [Abstract] | ||
Net deferred income tax liabilities | (326) | (389) |
Deferred income taxes | 327 | $ 389 |
Deferred Tax Assets, Net of Valuation Allowance, Noncurrent | 1 | |
Operating Loss Carryforwards | $ 1,026 |
Note 10. Income Taxes Accountin
Note 10. Income Taxes Accounting for Uncertainty in Income Taxes (Details) - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | ||||
Unrecognized Tax Benefits | $ (78) | $ (78) | $ (106) | $ (22) |
Unrecognized Tax Benefits that Would Impact Effective Tax Rate | 19 | |||
Significant Change in Unrecognized Tax Benefits is Reasonably Possible, Amount of Unrecorded Benefit | $ 2 | |||
Unrecognized Tax Benefits, Statute of Limitations, Scheduled Expiration as of Reporting Date | 12 months | |||
Increase (Decrease) in Interest Accrued for Unrecognized Tax Benefits | $ 2 | 4 | ||
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns | ||||
Unrecognized Tax Benefits, Beginning of Period | 78 | 78 | 106 | |
Gross decreases—tax positions in prior periods | (54) | (4) | ||
Gross increases—tax positions in current period | 1 | |||
Gross increases—tax positions in prior periods | 1 | 3 | ||
Settlements | (23) | |||
Reduction due to lapse of statute of limitations | (3) | (3) | (2) | |
Unrecognized Tax Benefits, End of Period | $ 22 | $ 78 | $ 78 |
Note 10. Income Taxes Tax Shari
Note 10. Income Taxes Tax Sharing Agreement (Details) | Dec. 31, 2017 |
Income Tax Disclosure [Abstract] | |
Guaranty Arrangement Percentage of Obligations Assumed by Realogy | 62.50% |
Note 11. Restructuring Costs 78
Note 11. Restructuring Costs Restructuring Costs (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||||||
Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | ||||
Restructuring Reserve [Roll Forward] | |||||||||||||||
Restructuring costs, net | $ 3 | $ 2 | $ 2 | $ 5 | $ 9 | $ 9 | $ 12 | $ 9 | $ 12 | $ 39 | $ 10 | ||||
Real Estate Franchise Services | |||||||||||||||
Restructuring Reserve [Roll Forward] | |||||||||||||||
Restructuring costs, net | 1 | ||||||||||||||
Company Owned Real Estate Brokerage Services | |||||||||||||||
Restructuring Reserve [Roll Forward] | |||||||||||||||
Restructuring costs, net | 9 | 22 | 5 | ||||||||||||
Relocation Services | |||||||||||||||
Restructuring Reserve [Roll Forward] | |||||||||||||||
Restructuring costs, net | 4 | 1 | |||||||||||||
Title and Settlement Services | |||||||||||||||
Restructuring Reserve [Roll Forward] | |||||||||||||||
Restructuring costs, net | 1 | 1 | |||||||||||||
Business Optimization Plan [Member] | |||||||||||||||
Restructuring Reserve [Roll Forward] | |||||||||||||||
Balance at October 1, 2015 | 16 | 9 | $ 0 | 16 | 9 | ||||||||||
Restructuring costs, net | 10 | 12 | 39 | 10 | |||||||||||
Costs paid or otherwise settled | (1) | (21) | (32) | ||||||||||||
Balance at December 31, 2017 | 7 | 16 | 9 | 7 | 16 | 9 | |||||||||
Restructuring and Related Cost, Expected Cost [Abstract] | |||||||||||||||
Total amount expected to be incurred | 63 | 63 | |||||||||||||
Amount incurred to date | 61 | ||||||||||||||
Total amount remaining to be incurred | 2 | 2 | |||||||||||||
Business Optimization Plan [Member] | Real Estate Franchise Services | |||||||||||||||
Restructuring and Related Cost, Expected Cost [Abstract] | |||||||||||||||
Total amount expected to be incurred | 5 | 5 | |||||||||||||
Amount incurred to date | 5 | ||||||||||||||
Total amount remaining to be incurred | 0 | 0 | |||||||||||||
Business Optimization Plan [Member] | Company Owned Real Estate Brokerage Services | |||||||||||||||
Restructuring and Related Cost, Expected Cost [Abstract] | |||||||||||||||
Total amount expected to be incurred | 36 | 36 | |||||||||||||
Amount incurred to date | 36 | ||||||||||||||
Total amount remaining to be incurred | 0 | 0 | |||||||||||||
Business Optimization Plan [Member] | Relocation Services | |||||||||||||||
Restructuring and Related Cost, Expected Cost [Abstract] | |||||||||||||||
Total amount expected to be incurred | 5 | 5 | |||||||||||||
Amount incurred to date | 5 | ||||||||||||||
Total amount remaining to be incurred | 0 | 0 | |||||||||||||
Business Optimization Plan [Member] | Title and Settlement Services | |||||||||||||||
Restructuring and Related Cost, Expected Cost [Abstract] | |||||||||||||||
Total amount expected to be incurred | 2 | 2 | |||||||||||||
Amount incurred to date | 2 | ||||||||||||||
Total amount remaining to be incurred | 0 | 0 | |||||||||||||
Business Optimization Plan [Member] | Corporate [Member] | |||||||||||||||
Restructuring and Related Cost, Expected Cost [Abstract] | |||||||||||||||
Total amount expected to be incurred | 15 | 15 | |||||||||||||
Amount incurred to date | 13 | ||||||||||||||
Total amount remaining to be incurred | 2 | 2 | |||||||||||||
Personnel-related costs | Business Optimization Plan [Member] | |||||||||||||||
Restructuring Reserve [Roll Forward] | |||||||||||||||
Balance at October 1, 2015 | 9 | 3 | 0 | 9 | 3 | ||||||||||
Restructuring costs, net | 3 | 7 | 22 | 3 | [1] | ||||||||||
Costs paid or otherwise settled | 0 | (13) | (16) | ||||||||||||
Balance at December 31, 2017 | 3 | 9 | 3 | 3 | 9 | 3 | |||||||||
Restructuring and Related Cost, Expected Cost [Abstract] | |||||||||||||||
Total amount expected to be incurred | 32 | 32 | |||||||||||||
Amount incurred to date | 32 | ||||||||||||||
Total amount remaining to be incurred | 0 | 0 | |||||||||||||
Facility-related costs | Business Optimization Plan [Member] | |||||||||||||||
Restructuring Reserve [Roll Forward] | |||||||||||||||
Balance at October 1, 2015 | 7 | 3 | 0 | 7 | 3 | ||||||||||
Restructuring costs, net | 3 | 3 | 10 | 3 | [2] | ||||||||||
Costs paid or otherwise settled | 0 | (7) | (6) | ||||||||||||
Balance at December 31, 2017 | 3 | 7 | 3 | 3 | 7 | 3 | |||||||||
Restructuring and Related Cost, Expected Cost [Abstract] | |||||||||||||||
Total amount expected to be incurred | 16 | 16 | |||||||||||||
Amount incurred to date | 16 | ||||||||||||||
Total amount remaining to be incurred | 0 | 0 | |||||||||||||
Accelerated depreciation related to asset disposals | Business Optimization Plan [Member] | |||||||||||||||
Restructuring Reserve [Roll Forward] | |||||||||||||||
Balance at October 1, 2015 | 0 | 0 | 0 | 0 | 0 | ||||||||||
Restructuring costs, net | 0 | 1 | 1 | 0 | |||||||||||
Costs paid or otherwise settled | 0 | 0 | (1) | ||||||||||||
Balance at December 31, 2017 | 1 | 0 | 0 | 1 | 0 | 0 | |||||||||
Restructuring and Related Cost, Expected Cost [Abstract] | |||||||||||||||
Total amount expected to be incurred | 3 | 3 | |||||||||||||
Amount incurred to date | 2 | ||||||||||||||
Total amount remaining to be incurred | 1 | 1 | |||||||||||||
Other restructuring costs | Business Optimization Plan [Member] | |||||||||||||||
Restructuring Reserve [Roll Forward] | |||||||||||||||
Balance at October 1, 2015 | $ 0 | $ 3 | 0 | 0 | 3 | ||||||||||
Restructuring costs, net | 4 | 1 | [3] | 6 | [3] | 4 | [3] | ||||||||
Costs paid or otherwise settled | (1) | (1) | (9) | ||||||||||||
Balance at December 31, 2017 | 0 | $ 0 | $ 3 | 0 | $ 0 | $ 3 | |||||||||
Restructuring and Related Cost, Expected Cost [Abstract] | |||||||||||||||
Total amount expected to be incurred | 12 | 12 | |||||||||||||
Amount incurred to date | 11 | ||||||||||||||
Total amount remaining to be incurred | $ 1 | $ 1 | |||||||||||||
[1] | Personnel-related costs consist of severance costs provided to employees who have been terminated and duplicate payroll costs during transition. | ||||||||||||||
[2] | Facility-related costs consist of costs associated with planned facility closures such as contract termination costs, lease payments that will continue to be incurred under the contract for its remaining term without economic benefit to the Company and other facility and employee relocation related costs. | ||||||||||||||
[3] | Other restructuring costs consist of costs related to professional fees, consulting fees and other costs associated with restructuring activities which are primarily included in the Corporate and Other business segment. |
Note 12. Stock-Based Compensa79
Note 12. Stock-Based Compensation Introduction Narrative (Details) shares in Millions, $ in Millions | 12 Months Ended |
Dec. 31, 2017USD ($)Performance_metricsshares | |
Retirement Eligibility Age | 65 years |
Retirement Eligibility Age with Ten Years of Service | 55 years |
Retirement Eligibility Years Tenure | 10 years |
Retirement Eligibility Service Requirement | 1 year |
Shares available for future grant under the plan (in shares) | shares | 3 |
Maximum | |
Shares authorized for issuance under the plan (in shares) | shares | 16.6 |
Restricted Stock Units | |
Stock options vesting period | 3 years |
Annual Vesting Percentage | 33.33% |
Performance Share Units | |
Stock options vesting period | 3 years |
Annual Vesting Percentage | 33.33% |
Number of performance metrics | Performance_metrics | 2 |
The first performance metric | Performance_metrics | 1 |
Performance Share Units | RTSR | Minimum | |
Award Vesting Percentage | 0.00% |
Performance Share Units | RTSR | Maximum | |
Award Vesting Percentage | 175.00% |
Performance Share Units | Cumulative Free Cash Flow | Minimum | |
Award Vesting Percentage | 0.00% |
Performance Share Units | Cumulative Free Cash Flow | Maximum | |
Award Vesting Percentage | 200.00% |
Options | |
Stock options vesting period | 4 years |
Annual Vesting Percentage | 25.00% |
Contractual Term | 10 years |
New CEO Inducement Award [Member] | |
Share-based Payment Award Granted Amount | $ 5 |
New CEO Inducement Award [Member] | Restricted Stock Units | |
Share-based Payment Award Granted Amount | 2.5 |
New CEO Inducement Award [Member] | Options | |
Share-based Payment Award Granted Amount | $ 2.5 |
Note 12. Stock-Based Compensa80
Note 12. Stock-Based Compensation Incentive Equity Awards Activity - Summary of Share-Based Compensation Activity (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 12 Months Ended | ||||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |||
Options, Weighted Average Exercise Price Roll Forward | |||||
Proceeds from exercise of stock options | $ 8 | $ 2 | $ 5 | ||
Restricted Stock Units | |||||
Equity Instruments Other than Options, Number of Shares Roll Forward | |||||
Outstanding at January 1, 2017 | 1.5 | ||||
Granted | 1.2 | ||||
Distributed/Exercised | [1] | (0.6) | |||
Forfeited/Expired | (0.1) | ||||
Outstanding at December 31, 2017 | 2 | 1.5 | |||
Equity Instruments Other than Options, Weighted Average Grant Date Fair Value Roll Forward | |||||
Outstanding at January 1, 2017 | $ 37.72 | ||||
Granted | 28.61 | ||||
Distributed/Exercised | 39.64 | ||||
Forfeited/Expired | 30.90 | ||||
Outstanding at December 31, 2017 | $ 31.71 | $ 37.72 | |||
Options, Weighted Average Exercise Price Roll Forward | |||||
Fair Value of Shares Distributed in Period | $ 26 | ||||
Performance Share Units | |||||
Equity Instruments Other than Options, Number of Shares Roll Forward | |||||
Outstanding at January 1, 2017 | [2] | 1.4 | |||
Granted | [2] | 0.7 | |||
Distributed/Exercised | [2],[3] | (0.3) | |||
Forfeited/Expired | [2] | 0 | |||
Outstanding at December 31, 2017 | [2] | 1.8 | 1.4 | ||
Equity Instruments Other than Options, Weighted Average Grant Date Fair Value Roll Forward | |||||
Outstanding at January 1, 2017 | $ 38.31 | ||||
Granted | 27.70 | ||||
Distributed/Exercised | 42.30 | ||||
Forfeited/Expired | 0 | ||||
Outstanding at December 31, 2017 | $ 33.16 | $ 38.31 | |||
Options, Weighted Average Exercise Price Roll Forward | |||||
Fair Value of Shares Distributed in Period | $ 14 | ||||
Fair Value of Shares Vested in Period | $ 9 | $ 10 | |||
Shares Vested in Period | 0.2 | ||||
Weighted Average Fair Value of Shares Vested in Period | $ 46.46 | ||||
Options | |||||
Options, Number of Shares Roll Forward | |||||
Outstanding at January 1, 2017 | [4] | 3.3 | |||
Granted | [4] | 0.7 | |||
Distributed/Exercised | [4],[5] | (0.3) | |||
Forfeited/Expired | [4] | (0.1) | |||
Outstanding at December 31, 2017 | [4] | 3.6 | [6] | 3.3 | |
Options, Weighted Average Exercise Price Roll Forward | |||||
Outstanding at January 1, 2017 | $ 31.69 | ||||
Granted | 29.60 | ||||
Distributed/Exercised | 23.29 | ||||
Forfeited/Expired | 50.24 | ||||
Outstanding at December 31, 2017 | $ 31.75 | $ 31.69 | |||
Intrinsic Value of Options Exercised | $ 2 | ||||
Proceeds from exercise of stock options | 8 | ||||
Intrinsic Value of Outstanding Options | $ 6 | ||||
Weighted Average Remaining Contractual Life of Outstanding Options | 5 years 9 months | ||||
[1] | (b)The total fair value of RSUs which were distributed during the year ended December 31, 2017 was $26 million. | ||||
[2] | (a)The PSU amounts in the table are shown at the target amount of the award. | ||||
[3] | (c)The total fair value of PSUs which were distributed during the year ended December 31, 2017 was $14 million, which includes the distribution of PSUs awarded in 2014, measuring performance over a three-year performance period ended December 31, 2016, at a fair value of $10 million. Amounts distributed do not include 0.2 million PSUs awarded in 2015, measuring performance over a three-year period ended and vested December 31, 2017, at a fair value of $9 million and at a weighted average grant date fair value of $46.46. These PSUs were distributed in early 2018. | ||||
[4] | (f)The following table summarizes information regarding exercisable stock options as of December 31, 2017:Range of Exercise Prices Options Vested Weighted Average Exercise Price Aggregate Intrinsic Value Weighted Average Remaining Contractual Life$15.00 to $50.00 2.4 $27.86 $6.3 4.7 years$50.01 and above 0.1 $140.26 $— 2.8 years | ||||
[5] | (d)The intrinsic value of options exercised during the year ended December 31, 2017 was $2 million. Cash received from options exercised during the year ended December 31, 2017 was $8 million. | ||||
[6] | (e)Options outstanding at December 31, 2017 have an intrinsic value of $6 million and have a weighted average remaining contractual life of 5.8 years. |
Note 12. Stock-Based Compensa81
Note 12. Stock-Based Compensation Summary of Exercisable Stock Options (Details) - Options $ / shares in Units, $ in Thousands, shares in Millions | 12 Months Ended |
Dec. 31, 2017USD ($)$ / sharesshares | |
$15.00 to $50.00 | |
Exercisable Stock Options, Additional Disclosures | |
Options Vested | shares | 2.4 |
Weighted Average Exercise Price | $ / shares | $ 27.86 |
Aggregate Intrinsic Value | $ | $ 6,300 |
Weighted Average Remaining Contractual Life | 4 years 8 months |
$50.01 and above | |
Exercisable Stock Options, Additional Disclosures | |
Options Vested | shares | 0.1 |
Weighted Average Exercise Price | $ / shares | $ 140.26 |
Aggregate Intrinsic Value | $ | $ 0 |
Weighted Average Remaining Contractual Life | 2 years 9 months |
Note 12. Stock-Based Compensa82
Note 12. Stock-Based Compensation Incentive Equity Awards Activity - Summary of Market Performance Units Valuation Assumptions (Details) - Performance Share Units - RTSR | 12 Months Ended | |||
Dec. 31, 2017$ / shares | Dec. 31, 2016$ / shares | Dec. 31, 2015$ / shares | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Weighted average grant date fair value | $ 27.98 | $ 27.99 | $ 41.08 | |
Weighted average correlation coefficient | 0.53 | 0.58 | 0.57 | |
Weighted average risk-free interest rate | 1.50% | 0.90% | 1.00% | |
Weighted average dividend yield | 0.00% | 0.00% | 0.00% | |
Realogy and comparable companies | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Weighted average expected volatility (a) | [1] | 29.00% | 28.10% | 25.10% |
XHB | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Weighted average expected volatility (a) | 18.40% | 19.40% | 21.10% | |
[1] | (a)Expected volatility is based on historical volatilities of the Company and select comparable companies. |
Note 12. Stock-Based Compensa83
Note 12. Stock-Based Compensation Incentive Equity Awards Activity - Summary of Stock Options Valuation Assumptions (Details) - Options - $ / shares | 12 Months Ended | |||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | ||
Fair Value Assumptions | ||||
Weighted average grant date fair value | $ 8.61 | $ 10.81 | $ 17.66 | |
Weighted average expected volatility (a) | [1] | 30.70% | 31.70% | 36.10% |
Weighted average expected term (years) (b) | [2] | 6 years 3 months | 6 years 3 months | 6 years 3 months |
Weighted average risk-free interest rate (c) | [3] | 2.00% | 1.30% | 1.60% |
Weighted average dividend yield | 1.20% | 0.10% | 0.00% | |
[1] | (a)Expected volatility was based on historical volatilities of the Company and select comparable companies. | |||
[2] | (b)The expected term of the options granted represents the period of time that options are expected to be outstanding and is based on the simplified method. | |||
[3] | (c)The risk-free interest rate was based on the U.S. Treasury yield curve in effect at the time of the grant, which corresponds to the expected term of the options. |
Note 12. Stock-Based Compensa84
Note 12. Stock-Based Compensation Stock-Based Compensation Expense (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||
Unrecognized compensation cost | $ 36 | ||
Remaining weighted average period | 1 year 11 months | ||
Stock-based compensation expense | $ 52 | $ 57 | $ 57 |
Note 13. Commitments And Cont85
Note 13. Commitments And Contingencies Litigation and Tax Matters (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended |
Jun. 30, 2017 | Dec. 31, 2017 | |
Loss Contingencies [Line Items] | ||
Guaranty Arrangement Percentage of Obligations Assumed by Realogy | 62.50% | |
Guaranty Arrangement Percentage of Obligations Assumed by Wyndham | 37.50% | |
Strader | ||
Loss Contingencies [Line Items] | ||
Legal Fees | $ 8 | $ 8 |
Note 13. Commitments And Cont86
Note 13. Commitments And Contingencies Contingent Liability of Former Parent and Letter of Credit (Details) - USD ($) $ in Millions | Dec. 31, 2017 | Dec. 31, 2016 |
Other Commitments [Line Items] | ||
Guaranty Arrangement Percentage of Obligations Assumed by Realogy | 62.50% | |
Contingent liabilities of former parent, aggregate value | $ 30 | |
Due to former parent | $ 18 | $ 28 |
Synthetic Letter of Credit Facility [Member] | ||
Other Commitments [Line Items] | ||
Outstanding letter of credit | $ 53 |
Note 13. Commitments And Cont87
Note 13. Commitments And Contingencies Escrow and Trust Deposits (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Loss Contingencies [Line Items] | ||
Escrow and trust deposits | $ 469,000 | $ 415,000 |
Maximum | ||
Loss Contingencies [Line Items] | ||
Cash, FDIC Insured Amount | $ 250 |
Note 13. Commitments And Cont88
Note 13. Commitments And Contingencies Future Minimum Lease Payments (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Operating Leases, Future Minimum Payments Due, Fiscal Year Maturity [Abstract] | |||
2,018 | $ 163 | ||
2,019 | 142 | ||
2,020 | 116 | ||
2,021 | 91 | ||
2,022 | 72 | ||
Thereafter | 196 | ||
Total future minimum operating lease payments due | 780 | ||
Capital lease obligations | 29 | $ 27 | |
Imputed interest | 2 | 2 | |
Rent expense | $ 192 | $ 186 | $ 179 |
Note 13. Commitments And Cont89
Note 13. Commitments And Contingencies Purchase Commitments and Minimum Licensing Fees (Details) $ in Millions | 12 Months Ended |
Dec. 31, 2017USD ($) | |
Long-term Purchase Commitment [Line Items] | |
Purchase commitments | $ 94 |
Purchase Obligation, Fiscal Year Maturity [Abstract] | |
2,018 | 57 |
2,019 | 23 |
2,020 | 15 |
2,021 | 13 |
2,022 | 18 |
Thereafter | 222 |
Total purchase obligations | 348 |
Sotheby’s International Realty® | |
Long-term Purchase Commitment [Line Items] | |
Licensing fees | 2 |
Meredith Corporation | Minimum | |
Long-term Purchase Commitment [Line Items] | |
Licensing fees | 0.5 |
Meredith Corporation | Maximum | |
Long-term Purchase Commitment [Line Items] | |
Licensing fees | $ 4 |
Note 13. Commitments And Cont90
Note 13. Commitments And Contingencies Other Guarantees, Insurance and Self-Insurance (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Loss Contingencies [Line Items] | ||
Insurance liabilities | $ 40,000 | $ 31,000 |
Self insurance accruals | 16,000 | $ 21,000 |
Maximum | ||
Loss Contingencies [Line Items] | ||
Guarantees, gross | 7,000 | |
Fidelity Insurance | ||
Loss Contingencies [Line Items] | ||
Insurance deductible | 750 | |
Fidelity Insurance | Maximum | ||
Loss Contingencies [Line Items] | ||
Insurance liabilities | 30,000 | |
Company Owned Real Estate Brokerage Services | Errors and Omissions Insurance | ||
Loss Contingencies [Line Items] | ||
Insurance liabilities | 15,000 | |
Insurance deductible | 1,000 | |
Company Owned Real Estate Brokerage Services | Errors and Omissions Insurance including additional Realogy Group Coverage | ||
Loss Contingencies [Line Items] | ||
Insurance deductible | 1,000 | |
Company Owned Real Estate Brokerage Services | Errors and Omissions Insurance including additional Realogy Group Coverage | Maximum | ||
Loss Contingencies [Line Items] | ||
Insurance liabilities | 50,000 | |
Realogy Group | Errors and Omissions Insurance | ||
Loss Contingencies [Line Items] | ||
Insurance deductible | 2,500 | |
Realogy Group | Errors and Omissions Insurance | Maximum | ||
Loss Contingencies [Line Items] | ||
Insurance liabilities | 35,000 | |
Title and Settlement Services | Maximum | ||
Loss Contingencies [Line Items] | ||
Underwriter of title insurance policies, value, per policy | 1,500 | |
Title and Settlement Services | Minimum | ||
Loss Contingencies [Line Items] | ||
Underwriter of title insurance policy, reinsurance policy obtained from national underwriter, value per policy | $ 1,500 |
Note 14. Equity (Deficit) Accum
Note 14. Equity (Deficit) Accumulated Other Comprehensive Loss (Details) - USD ($) $ / shares in Units, $ in Millions | 1 Months Ended | 3 Months Ended | 12 Months Ended | ||||||
Aug. 31, 2016 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | ||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||
Accumulated Other Comprehensive Income (Loss), Beginning of Period Balance | $ (40) | $ (40) | |||||||
Income tax (expense) benefit | 1 | $ (3) | $ 0 | ||||||
Current period change | 3 | (4) | (1) | ||||||
Accumulated Other Comprehensive Income (Loss), End of Period Balance | $ (37) | (37) | (40) | ||||||
Dividends [Abstract] | |||||||||
Common Stock, Dividends, Per Share, Declared | $ 0.09 | $ 0.09 | $ 0.09 | $ 0.09 | $ 0.09 | ||||
Dividends, Common Stock, Cash | 49 | 26 | |||||||
Currency Translation Adjustments (1) | |||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||
Accumulated Other Comprehensive Income (Loss), Beginning of Period Balance | [1] | $ (6) | (6) | (3) | 0 | ||||
Other comprehensive income (loss) before reclassifications | [1] | 3 | (5) | (4) | |||||
Amounts reclassified from accumulated other comprehensive income | [1] | 0 | 0 | 0 | |||||
Income tax (expense) benefit | [1] | (1) | 2 | 1 | |||||
Current period change | [1] | 2 | (3) | (3) | |||||
Accumulated Other Comprehensive Income (Loss), End of Period Balance | [1] | $ (4) | (4) | (6) | (3) | ||||
Minimum Pension Liability Adjustment | Minimum | |||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||
Accumulated Other Comprehensive Income (Loss), Beginning of Period Balance | (34) | (34) | (33) | (35) | |||||
Other comprehensive income (loss) before reclassifications | (1) | (3) | 1 | ||||||
Amounts reclassified from accumulated other comprehensive income | [2] | 2 | 1 | 2 | |||||
Income tax (expense) benefit | 0 | 1 | (1) | ||||||
Current period change | 1 | (1) | 2 | ||||||
Accumulated Other Comprehensive Income (Loss), End of Period Balance | (33) | (33) | (34) | (33) | |||||
Accumulated Other Comprehensive Loss (2) | |||||||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||||||
Accumulated Other Comprehensive Income (Loss), Beginning of Period Balance | [3] | $ (40) | (40) | (36) | (35) | ||||
Other comprehensive income (loss) before reclassifications | [3] | 2 | (8) | (3) | |||||
Amounts reclassified from accumulated other comprehensive income | [3] | 2 | 1 | 2 | |||||
Income tax (expense) benefit | [3] | (1) | 3 | 0 | |||||
Current period change | [3] | 3 | (4) | (1) | |||||
Accumulated Other Comprehensive Income (Loss), End of Period Balance | [3] | $ (37) | $ (37) | $ (40) | $ (36) | ||||
[1] | Assets and liabilities of foreign subsidiaries having non-U.S. dollar functional currencies are translated at exchange rates at the balance sheet dates and equity accounts are translated at historical spot rates. Revenues and expenses are translated at average exchange rates during the periods presented. The gains or losses resulting from translating foreign currency financial statements into U.S. dollars are included in accumulated other comprehensive income (loss). Gains or losses resulting from foreign currency transactions are included in the Consolidated Statements of Operations. | ||||||||
[2] | These amounts represent the amortization of actuarial loss to periodic pension cost and were reclassified from accumulated other comprehensive income to the general and administrative expenses line on the statement of operations. | ||||||||
[3] | As of December 31, 2017, the Company does not have any after-tax components of accumulated other comprehensive loss attributable to noncontrolling interests. |
Note 14. Equity (Deficit) State
Note 14. Equity (Deficit) Statement of Equity (Deficit) (Details) - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | ||
Statement of Equity Table [Line Items] | ||||
Balance | $ 2,469 | $ 2,422 | $ 2,183 | |
Cumulative Effect of New Accounting Principle in Period of Adoption | 5 | |||
Net income | 434 | 217 | 188 | |
Other comprehensive income | 3 | (4) | (1) | |
Stock Repurchased and Retired During Period, Value | (280) | (195) | ||
Other comprehensive loss | 8 | 2 | 5 | |
Repurchase of Common Stock | 41 | 51 | 51 | |
Dividends of Common Stock, Cash | (49) | (26) | ||
Dividends | (53) | (29) | (4) | |
Balance | 2,622 | 2,469 | 2,422 | |
Common Stock | ||||
Statement of Equity Table [Line Items] | ||||
Balance | 1 | 1 | 1 | |
Balance | 1 | 1 | 1 | |
Additional Paid-In Capital | ||||
Statement of Equity Table [Line Items] | ||||
Balance | 5,565 | 5,733 | 5,677 | |
Stock Repurchased and Retired During Period, Value | (280) | (195) | ||
Other comprehensive loss | 8 | 2 | 5 | |
Repurchase of Common Stock | 41 | 51 | 51 | |
Balance | 5,285 | 5,565 | 5,733 | |
Accumulated Deficit | ||||
Statement of Equity Table [Line Items] | ||||
Balance | (3,062) | (3,280) | (3,464) | |
Cumulative Effect of New Accounting Principle in Period of Adoption | 5 | |||
Net income | 431 | 213 | 184 | |
Balance | (2,631) | (3,062) | (3,280) | |
Accumulated Other Comprehensive Loss | ||||
Statement of Equity Table [Line Items] | ||||
Balance | (40) | (36) | (35) | |
Other comprehensive income | [1] | 3 | (4) | (1) |
Balance | (37) | (40) | (36) | |
Non- controlling Interests | ||||
Statement of Equity Table [Line Items] | ||||
Balance | 5 | 4 | 4 | |
Net income | 3 | 4 | 4 | |
Dividends | (4) | (3) | (4) | |
Balance | 4 | 5 | 4 | |
Realogy Group [Member] | Common Stock | ||||
Statement of Equity Table [Line Items] | ||||
Balance | 0 | 0 | 0 | |
Balance | 0 | 0 | 0 | |
Realogy Group [Member] | Additional Paid-In Capital | ||||
Statement of Equity Table [Line Items] | ||||
Balance | 5,566 | 5,734 | 5,678 | |
Balance | $ 5,286 | $ 5,566 | $ 5,734 | |
[1] | As of December 31, 2017, the Company does not have any after-tax components of accumulated other comprehensive loss attributable to noncontrolling interests. |
Earnings (Loss) Per Share (Deta
Earnings (Loss) Per Share (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 2 Months Ended | 3 Months Ended | 12 Months Ended | |||||||||||||||||||
Jan. 31, 2017 | Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Feb. 23, 2017 | ||||||||||
Earnings Per Share [Abstract] | ||||||||||||||||||||||
Net income attributable to Realogy Holdings shareholders | $ 255 | $ 95 | $ 109 | $ (28) | $ 57 | $ 106 | $ 92 | $ (42) | $ 431 | $ 213 | $ 184 | |||||||||||
Basic weighted average shares | 136.7 | 144.5 | 146.5 | |||||||||||||||||||
Stock options, restricted stock, restricted stock units and performance share units (a) | [1] | 1.7 | 1.3 | 1.6 | ||||||||||||||||||
Weighted average diluted shares | 138.4 | 145.8 | 148.1 | |||||||||||||||||||
Earnings Per Share, Basic | $ 1.91 | [2] | $ 0.70 | [2] | $ 0.79 | [2] | $ (0.20) | [2] | $ 0.40 | [3] | $ 0.74 | [3] | $ 0.63 | [3] | $ (0.29) | [3] | $ 3.15 | $ 1.47 | $ 1.26 | |||
Earnings Per Share, Diluted | $ 1.89 | [2] | $ 0.69 | [2] | $ 0.78 | [2] | $ (0.20) | [2] | $ 0.40 | [3] | $ 0.73 | [3] | $ 0.63 | [3] | $ (0.29) | [3] | $ 3.11 | $ 1.46 | $ 1.24 | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 5.3 | 4.5 | 3.5 | |||||||||||||||||||
Stock Repurchases [Line Items] | ||||||||||||||||||||||
Stock Repurchased and Retired During Period, Shares | 9.4 | 7.1 | ||||||||||||||||||||
Stock Repurchased and Retired During Period, Value | $ 280 | $ 195 | ||||||||||||||||||||
Stock Repurchased and Retired During Period, Weighted Average Market Price | $ 29.38 | $ 27.96 | ||||||||||||||||||||
Maximum | ||||||||||||||||||||||
Stock Repurchases [Line Items] | ||||||||||||||||||||||
Stock Repurchase Program, Authorized Amount | $ 575 | |||||||||||||||||||||
Common Stock Settlement Date after Period End [Member] | ||||||||||||||||||||||
Stock Repurchases [Line Items] | ||||||||||||||||||||||
Stock Repurchased and Retired During Period, Shares | 0.2 | |||||||||||||||||||||
Stock Repurchased and Retired During Period, Value | $ 276 | $ 199 | ||||||||||||||||||||
[1] | Excludes 5.3 million, 4.5 million and 3.5 million shares of common stock issuable for incentive equity awards, including performance share units based on the achievement of target amounts, for the years ended December 31, 2017, 2016 and 2015, respectively, which are anti-dilutive to the diluted earnings per share computation. | |||||||||||||||||||||
[2] | Basic and diluted EPS amounts in each quarter are computed using the weighted-average number of shares outstanding during that quarter, while basic and diluted EPS for the full year is computed using the weighted-average number of shares outstanding during the year. Therefore, the sum of the four quarters’ basic or diluted EPS may not equal the full year basic or diluted EPS (see Note 15 "Earnings Per Share" for further information). | |||||||||||||||||||||
[3] | Basic and diluted EPS amounts in each quarter are computed using the weighted-average number of shares outstanding during that quarter, while basic and diluted EPS for the full year is computed using the weighted-average number of shares outstanding during the year. Therefore, the sum of the four quarters’ basic or diluted EPS may not equal the full year basic or diluted EPS. |
Interest Rate, Credit, and Mark
Interest Rate, Credit, and Market Risk Exposures (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Principal value of variable rate long term debt | $ 1,886 | ||
Securitization obligations | $ 194 | $ 205 | |
Company Owned Real Estate Brokerage Services | California | |||
Concentration risk, geographic area, revenue | 27.00% | 26.00% | 27.00% |
Company Owned Real Estate Brokerage Services | New York | |||
Concentration risk, geographic area, revenue | 22.00% | 22.00% | 23.00% |
Company Owned Real Estate Brokerage Services | Florida | |||
Concentration risk, geographic area, revenue | 9.00% | 9.00% | 10.00% |
Minimum | |||
Fixed interest rate of swaps | 2.07% | ||
Maximum | |||
Fixed interest rate of swaps | 2.89% | ||
Interest rate swap contracts | |||
Notional value of derivative instrument | $ 1,475 | ||
Interest rate swap contracts | Not Designated as Hedging Instruments | Other non-current liabilities | |||
Fair value of interest rate derivative liabilities | $ 13 | $ 33 |
Derivative Instruments (Details
Derivative Instruments (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | ||
Foreign exchange contracts | |||||||||||
Derivative [Line Items] | |||||||||||
Fair value of derivative instrument | $ 2 | $ 2 | |||||||||
Notional value of derivative instrument | $ 25 | 29 | $ 25 | 29 | |||||||
Foreign exchange contracts | Not Designated as Hedging Instruments | Operating expense | |||||||||||
Derivative [Line Items] | |||||||||||
(Gain) or Loss Recognized on Derivatives | 2 | (2) | $ (2) | ||||||||
Interest rate swap contracts | |||||||||||
Derivative [Line Items] | |||||||||||
Notional value of derivative instrument | 1,475 | 1,475 | |||||||||
Interest rate swap contracts | Not Designated as Hedging Instruments | Interest Expense | |||||||||||
Derivative [Line Items] | |||||||||||
(Gain) or Loss Recognized on Derivatives | (8) | $ 5 | $ (1) | (34) | $ (5) | $ 14 | $ 31 | (4) | 6 | $ 20 | |
Interest rate swap contracts | Other non-current liabilities | Not Designated as Hedging Instruments | |||||||||||
Derivative [Line Items] | |||||||||||
Fair value of interest rate derivative liabilities | 13 | $ 33 | 13 | $ 33 | |||||||
Interest rate swap contracts | July 2012 | |||||||||||
Derivative [Line Items] | |||||||||||
Notional value of derivative instrument | [1],[2] | 225 | 225 | ||||||||
Interest rate swap contracts | January 2013 | |||||||||||
Derivative [Line Items] | |||||||||||
Notional value of derivative instrument | [1],[2] | 200 | 200 | ||||||||
Interest rate swap contracts | August 2015 | |||||||||||
Derivative [Line Items] | |||||||||||
Notional value of derivative instrument | 600 | 600 | |||||||||
Interest rate swap contracts | November 2017 | |||||||||||
Derivative [Line Items] | |||||||||||
Notional value of derivative instrument | [1],[2] | 450 | 450 | ||||||||
Interest rate swap contracts | July 2012 and January 2013 | |||||||||||
Derivative [Line Items] | |||||||||||
Notional value of derivative instrument | 425 | 425 | |||||||||
Maximum | Foreign exchange contracts | |||||||||||
Derivative [Line Items] | |||||||||||
Fair value of derivative instrument | $ 1 | $ 1 | |||||||||
[1] | (a)Interest rates swaps with a notional value of $425 million expired February 10, 2018, and interest rate swaps with a notional value of $450 million commenced in the fourth quarter of 2017. | ||||||||||
[2] | Interest rates swaps with a notional value of $425 million expired February 10, 2018, and interest rate swaps with a notional value of $450 million commenced in the fourth quarter of 2017. |
Financial Instruments (Details)
Financial Instruments (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Fair Value, Liabilities Measured on Recurring and Nonrecurring Basis, Alternative [Abstract] | ||
Fair value of contingent consideration at December 31, 2016 | $ 50 | |
Additions: contingent consideration completed during the period | 7 | |
Reduction: payment of contingent consideration | (22) | |
Changes in fair value | (1) | |
Fair value of contingent consideration at December 31, 2017 | 34 | |
Deferred Compensation Plan Assets [Member] | Fair Value Measurements Recurring Member | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation plan assets (included in other non-current assets) | 3 | $ 3 |
Deferred Compensation Plan Assets [Member] | Fair Value Measurements Recurring Member | Level I | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation plan assets (included in other non-current assets) | 3 | 3 |
Deferred Compensation Plan Assets [Member] | Fair Value Measurements Recurring Member | Level II | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation plan assets (included in other non-current assets) | 0 | 0 |
Deferred Compensation Plan Assets [Member] | Fair Value Measurements Recurring Member | Level III | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Deferred compensation plan assets (included in other non-current assets) | 0 | 0 |
Contingent Consideration for Acquisitions [Member] | Fair Value Measurements Recurring Member | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Other Liabilities, Fair Value Disclosure | 34 | 50 |
Contingent Consideration for Acquisitions [Member] | Fair Value Measurements Recurring Member | Level I | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Other Liabilities, Fair Value Disclosure | 0 | 0 |
Contingent Consideration for Acquisitions [Member] | Fair Value Measurements Recurring Member | Level II | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Other Liabilities, Fair Value Disclosure | 0 | 0 |
Contingent Consideration for Acquisitions [Member] | Fair Value Measurements Recurring Member | Level III | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Other Liabilities, Fair Value Disclosure | 34 | 50 |
Interest rate swap contracts | Fair Value Measurements Recurring Member | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Interest rate swaps (included in other current and non-current liabilities) | 13 | 33 |
Interest rate swap contracts | Fair Value Measurements Recurring Member | Level I | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Interest rate swaps (included in other current and non-current liabilities) | 0 | 0 |
Interest rate swap contracts | Fair Value Measurements Recurring Member | Level II | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Interest rate swaps (included in other current and non-current liabilities) | 13 | 33 |
Interest rate swap contracts | Fair Value Measurements Recurring Member | Level III | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Interest rate swaps (included in other current and non-current liabilities) | $ 0 | $ 0 |
Fair Value Indebtedness Table (
Fair Value Indebtedness Table (Details) - USD ($) $ in Millions | Dec. 31, 2017 | Dec. 31, 2016 | Jul. 20, 2016 | Oct. 23, 2015 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||
Long-term Debt, Gross | [1] | $ 3,580 | ||||
Securitization obligations | 194 | $ 205 | ||||
Secured Debt | Term Loan B | ||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||
Long-term Debt, Gross | 1,083 | [2] | 1,094 | $ 1,100 | ||
Fair value of long-term debt | 1,085 | [3] | 1,100 | |||
Secured Debt | Term Loan A | ||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||
Long-term Debt, Gross | 391 | [4] | 413 | $ 435 | ||
Fair value of long-term debt | 393 | [3] | 414 | |||
Secured Debt | Term Loan A-1 | ||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||
Long-term Debt, Gross | 342 | [5] | 351 | $ 355 | ||
Fair value of long-term debt | 343 | [3] | 351 | |||
Senior Notes | 4.50% Senior Notes | ||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||
Long-term Debt, Gross | 450 | 450 | ||||
Fair value of long-term debt | 457 | [3] | 461 | |||
Senior Notes | 5.25% Senior Notes | ||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||
Long-term Debt, Gross | 550 | 550 | ||||
Fair value of long-term debt | 569 | [3] | 562 | |||
Senior Notes | 4.875% Senior Notes | ||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||
Long-term Debt, Gross | 500 | 500 | ||||
Fair value of long-term debt | 495 | [3] | 483 | |||
Line of Credit | Revolving Credit Facility | ||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||
Line of credit facility outstanding amount | 70 | [6],[7] | 200 | |||
Line of credit facility fair value | 70 | [3] | 200 | |||
Securitization obligations | ||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||||
Securitization obligations | 194 | 205 | ||||
Fair value of securitization obligations | $ 194 | [3] | $ 205 | |||
[1] | Not included in this table is the Company's Unsecured Letter of Credit Facility which had a capacity of $74 million with $69 million utilized at a weighted average rate of 3.24% at December 31, 2017. | |||||
[2] | The Term Loan B provided for quarterly amortization payments totaling 1% per annum of the original principal amount. The interest rate with respect to term loans under the Term Loan B was based on, at the Company’s option, (a) adjusted LIBOR plus 2.25% (with a LIBOR floor of 0.75%) or (b) JPMorgan Chase Bank, N.A.’s prime rate ("ABR") plus 1.25% (with an ABR floor of 1.75%). See Note 19, "Subsequent Events" for a description of the February 2018 refinancing. | |||||
[3] | The fair value of the Company's indebtedness is categorized as Level II. | |||||
[4] | The Term Loan A provided for quarterly amortization payments, which commenced March 31, 2016, totaling per annum 5%, 5%, 7.5%, 10.0% and 12.5% of the original principal amount of the Term Loan A in 2016, 2017, 2018, 2019 and 2020, respectively. The interest rates with respect to term loans under the Term Loan A were based on, at the Company's option, (a) adjusted LIBOR plus an additional margin or (b) ABR plus an additional margin, in each case subject to adjustment based on the then current senior secured leverage ratio. Based on the previous quarter senior secured leverage ratio, the LIBOR margin was 2.00% and the ABR margin was 1.00% for the three months ended December 31, 2017. See Note 19, "Subsequent Events" for a description of the February 2018 refinancing. | |||||
[5] | The Term Loan A-1 provided for quarterly amortization payments, which commenced on September 30, 2016, totaling per annum 2.5%, 2.5%, 5%, 7.5% and 10.0% of the original principal amount of the Term Loan A-1, with the last amortization payment made on June 30, 2021. The interest rates with respect to term loans under the Term Loan A-1 were based on, at the Company's option, (a) adjusted LIBOR plus an additional margin or (b) ABR plus an additional margin, in each case subject to adjustment based on the then current senior secured leverage ratio. Based on the previous quarter senior secured leverage ratio, the LIBOR margin was 2.00% and the ABR margin was 1.00% for the three months ended December 31, 2017. See Note 19, "Subsequent Events" for a description of the February 2018 refinancing. | |||||
[6] | As of December 31, 2017, the Company had $1,050 million of borrowing capacity under its Revolving Credit Facility, leaving $980 million of available capacity. The Revolving Credit Facility expires in October 2020, but is classified on the balance sheet as current due to the revolving nature of the facility. On February 23, 2018, the Company had $242 million in outstanding borrowings under the New Revolving Credit Facility, leaving $1,158 million of available capacity. See Note 19, "Subsequent Events" for a description of the February 2018 refinancing. | |||||
[7] | Interest rates with respect to revolving loans under the Senior Secured Credit Facility at December 31, 2017 were based on, at the Company's option, (a) adjusted LIBOR plus an additional margin or (b) ABR plus an additional margin, in each case subject to adjustment based on the then current senior secured leverage ratio. Based on the previous quarter senior secured leverage ratio, the LIBOR margin was 2.00% and the ABR margin was 1.00% for the three months ended December 31, 2017. |
Reconciliation of Revenue from
Reconciliation of Revenue from Segments to Consolidated (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | ||||||||||||||||||||
Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | ||||||||||||
Segment Reporting, Revenue Reconciling Item [Line Items] | ||||||||||||||||||||||
Net revenues | $ 1,444 | $ 1,674 | $ 1,793 | $ 1,203 | $ 1,370 | $ 1,644 | $ 1,662 | $ 1,134 | $ 6,114 | [1],[2] | $ 5,810 | [1],[2] | $ 5,706 | [1],[2] | ||||||||
Real Estate Franchise Services | ||||||||||||||||||||||
Segment Reporting, Revenue Reconciling Item [Line Items] | ||||||||||||||||||||||
Net revenues | 199 | 224 | 237 | 170 | 188 | 215 | 221 | 157 | 830 | [1],[2] | 781 | [1],[2] | 755 | [1],[2] | ||||||||
Real Estate Franchise Services | Royalties and Marketing Fees [Member] | ||||||||||||||||||||||
Segment Reporting, Revenue Reconciling Item [Line Items] | ||||||||||||||||||||||
Net revenues | 311 | 293 | 295 | |||||||||||||||||||
Company Owned Real Estate Brokerage Services | ||||||||||||||||||||||
Segment Reporting, Revenue Reconciling Item [Line Items] | ||||||||||||||||||||||
Net revenues | 1,087 | 1,267 | 1,392 | 897 | 1,004 | 1,231 | 1,268 | 841 | 4,643 | [1],[2] | 4,344 | [1],[2] | 4,344 | [1],[2] | ||||||||
Relocation Services | ||||||||||||||||||||||
Segment Reporting, Revenue Reconciling Item [Line Items] | ||||||||||||||||||||||
Net revenues | 92 | 111 | 102 | 77 | 97 | 116 | 109 | 83 | 382 | [1],[2] | 405 | [1],[2] | 415 | [1],[2] | ||||||||
Relocation Services | Referral and Relocation Fees [Member] | ||||||||||||||||||||||
Segment Reporting, Revenue Reconciling Item [Line Items] | ||||||||||||||||||||||
Net revenues | 40 | 43 | 49 | |||||||||||||||||||
Title and Settlement Services | ||||||||||||||||||||||
Segment Reporting, Revenue Reconciling Item [Line Items] | ||||||||||||||||||||||
Net revenues | 139 | 154 | 157 | 120 | 149 | 164 | 149 | 111 | 570 | [1],[2] | 573 | [1],[2] | 487 | [1],[2] | ||||||||
Corporate and Other | ||||||||||||||||||||||
Segment Reporting, Revenue Reconciling Item [Line Items] | ||||||||||||||||||||||
Net revenues | $ (73) | [3] | $ (82) | [3] | $ (95) | [3] | $ (61) | [3] | $ (68) | [4] | $ (82) | [4] | $ (85) | [4] | $ (58) | [4] | $ (311) | [1],[2],[5] | $ (293) | [1],[2],[5] | $ (295) | [1],[2],[5] |
[1] | Revenues for the Relocation Services segment include intercompany referral commissions paid by the Company Owned Real Estate Brokerage Services segment of $40 million, $43 million and $49 million for the years ended December 31, 2017, 2016 and 2015, respectively. Such amounts are recorded as contra-revenues by the Company Owned Real Estate Brokerage Services segment. There are no other material intersegment transactions. | |||||||||||||||||||||
[2] | Transactions between segments are eliminated in consolidation. Revenues for the Real Estate Franchise Services segment include intercompany royalties and marketing fees paid by the Company Owned Real Estate Brokerage Services segment of $311 million, $293 million and $295 million for the years ended December 31, 2017, 2016 and 2015, respectively. Such amounts are eliminated through the Corporate and Other line. | |||||||||||||||||||||
[3] | Represents the elimination of transactions primarily between the Real Estate Franchise Services segment and the Company Owned Real Estate Brokerage Services segment. | |||||||||||||||||||||
[4] | Represents the elimination of transactions primarily between the Real Estate Franchise Services segment and the Company Owned Real Estate Brokerage Services segment. | |||||||||||||||||||||
[5] | Includes the elimination of transactions between segments. |
EBITDA (Details)
EBITDA (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||||||
Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |||||
Segment Reporting Information [Line Items] | |||||||||||||||
EBITDA | $ 725 | [1] | $ 733 | [2] | $ 726 | [3] | |||||||||
Restructuring costs, net | $ 3 | $ 2 | $ 2 | $ 5 | $ 9 | $ 9 | $ 12 | $ 9 | 12 | 39 | 10 | ||||
Expense Related to the Transition of the Company's CEO | 8 | 8 | |||||||||||||
Former parent legacy benefit, net | 1 | (11) | (3) | 1 | (10) | (2) | (15) | ||||||||
Loss on the early extinguishment of debt | 1 | 4 | 5 | 0 | 48 | ||||||||||
Net income attributable to Realogy Holdings and Realogy Group | $ 255 | $ 95 | 109 | $ (28) | $ 57 | $ 106 | $ 92 | $ (42) | 431 | 213 | 184 | ||||
Depreciation, Depletion and Amortization, Nonproduction, Adjusted for Amortization of Intangible Assets related to GRA Acquisition | [4] | 201 | |||||||||||||
Depreciation and amortization | 198 | 202 | [4] | 201 | [4] | ||||||||||
Interest expense, net | 158 | 174 | 231 | ||||||||||||
Income tax (benefit) expense | (65) | 144 | 110 | ||||||||||||
Income (Loss) from Equity Method Investments | 18 | 12 | 16 | ||||||||||||
Strader | |||||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||||
Legal Fees | $ 8 | 8 | |||||||||||||
Real Estate Franchise Services | |||||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||||
EBITDA | 559 | [1] | 516 | [2] | 495 | [3] | |||||||||
Restructuring costs, net | 1 | ||||||||||||||
Depreciation and amortization | 79 | 77 | 77 | ||||||||||||
Company Owned Real Estate Brokerage Services | |||||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||||
EBITDA | 126 | [1] | 137 | [2] | 199 | [3] | |||||||||
Restructuring costs, net | 9 | 22 | 5 | ||||||||||||
Depreciation and amortization | 50 | 49 | 46 | ||||||||||||
Relocation Services | |||||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||||
EBITDA | 85 | [1] | 96 | [2] | 105 | [3] | |||||||||
Restructuring costs, net | 4 | 1 | |||||||||||||
Depreciation and amortization | 33 | 31 | 33 | ||||||||||||
Title and Settlement Services | |||||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||||
EBITDA | 58 | [1] | 62 | [2] | 48 | [3] | |||||||||
Restructuring costs, net | 1 | 1 | |||||||||||||
Depreciation and amortization | 16 | 23 | 25 | ||||||||||||
Income (Loss) from Equity Method Investments | (4) | ||||||||||||||
Title and Settlement Services | Amortization of Intangible Assets related to GRA Acquisition | |||||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||||
Income (Loss) from Equity Method Investments | (3) | ||||||||||||||
Corporate and Other | |||||||||||||||
Segment Reporting Information [Line Items] | |||||||||||||||
EBITDA | [5] | (103) | [1] | (78) | [2] | (121) | [3] | ||||||||
Restructuring costs, net | 1 | 8 | 4 | ||||||||||||
Depreciation and amortization | $ 20 | $ 22 | $ 20 | ||||||||||||
[1] | (a)For the year ended December 31, 2017, the Real Estate Franchise Services segment includes restructuring charges of $1 million; the Company Owned Real Estate Brokerage Services segment includes restructuring charges of $9 million; the Title and Settlement Services segment includes restructuring charges of $1 million; and Corporate and Other includes an $8 million expense related to the settlement of the Strader legal matter, an $8 million expense related to the transition of the Company's CEO, $5 million related to the losses on the early extinguishment of debt and restructuring charges of $1 million, partially offset by a net benefit of $10 million of former parent legacy items. | ||||||||||||||
[2] | (b)For the year ended December 31, 2016, the Real Estate Franchise Services segment includes restructuring charges of $4 million; the Company Owned Real Estate Brokerage Services segment includes restructuring charges of $22 million; the Relocation Services segment includes restructuring charges of $4 million; the Title and Settlement Services segment includes restructuring charges of $1 million; and Corporate and Other includes restructuring charges of $8 million, partially offset by a net benefit of $2 million of former parent legacy items | ||||||||||||||
[3] | (c)For the year ended December 31, 2015, the Company Owned Real Estate Brokerage Services segment includes restructuring charges of $5 million; the Relocation Services segment includes restructuring charges of $1 million; and Corporate and Other includes $48 million related to the loss on the early extinguishment of debt and restructuring charges of $4 million, partially offset by a net benefit of $15 million of former parent legacy items. | ||||||||||||||
[4] | Depreciation and amortization for the year ended December 31, 2017 includes $3 million of amortization expense related to Guaranteed Rate Affinity's purchase accounting included in the "Equity in earnings of unconsolidated entities" line on the Consolidated Statement of Operations. | ||||||||||||||
[5] | Includes the elimination of transactions between segments. |
Reconciliation of Depreciation
Reconciliation of Depreciation and Amortization from Segments to Consolidated (Details) - USD ($) $ in Millions | 12 Months Ended | ||||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |||
Segment Reporting, Other Significant Reconciling Item [Line Items] | |||||
Depreciation and amortization | $ 198 | $ 202 | [1] | $ 201 | [1] |
Real Estate Franchise Services | |||||
Segment Reporting, Other Significant Reconciling Item [Line Items] | |||||
Depreciation and amortization | 79 | 77 | 77 | ||
Company Owned Real Estate Brokerage Services | |||||
Segment Reporting, Other Significant Reconciling Item [Line Items] | |||||
Depreciation and amortization | 50 | 49 | 46 | ||
Relocation Services | |||||
Segment Reporting, Other Significant Reconciling Item [Line Items] | |||||
Depreciation and amortization | 33 | 31 | 33 | ||
Title and Settlement Services | |||||
Segment Reporting, Other Significant Reconciling Item [Line Items] | |||||
Depreciation and amortization | 16 | 23 | 25 | ||
Corporate and Other | |||||
Segment Reporting, Other Significant Reconciling Item [Line Items] | |||||
Depreciation and amortization | $ 20 | $ 22 | $ 20 | ||
[1] | Depreciation and amortization for the year ended December 31, 2017 includes $3 million of amortization expense related to Guaranteed Rate Affinity's purchase accounting included in the "Equity in earnings of unconsolidated entities" line on the Consolidated Statement of Operations. |
Reconciliation of Assets from S
Reconciliation of Assets from Segment to Consolidated (Details) - USD ($) $ in Millions | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Segment Reporting, Asset Reconciling Item [Line Items] | |||
Total assets | $ 7,337 | $ 7,421 | $ 7,531 |
Real Estate Franchise Services | |||
Segment Reporting, Asset Reconciling Item [Line Items] | |||
Total assets | 4,413 | 4,477 | |
Company Owned Real Estate Brokerage Services | |||
Segment Reporting, Asset Reconciling Item [Line Items] | |||
Total assets | 1,258 | 1,249 | |
Relocation Services | |||
Segment Reporting, Asset Reconciling Item [Line Items] | |||
Total assets | 1,029 | 1,081 | |
Title and Settlement Services | |||
Segment Reporting, Asset Reconciling Item [Line Items] | |||
Total assets | 486 | 416 | |
Corporate and Other | |||
Segment Reporting, Asset Reconciling Item [Line Items] | |||
Total assets | $ 151 | $ 198 |
Reconciliation of Capital Expen
Reconciliation of Capital Expenditures from Segment to Consolidated (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Segment Reporting, Other Significant Reconciling Item [Line Items] | |||
Capital expenditures | $ 99 | $ 87 | $ 84 |
Real Estate Franchise Services | |||
Segment Reporting, Other Significant Reconciling Item [Line Items] | |||
Capital expenditures | 9 | 8 | 8 |
Company Owned Real Estate Brokerage Services | |||
Segment Reporting, Other Significant Reconciling Item [Line Items] | |||
Capital expenditures | 44 | 44 | 41 |
Relocation Services | |||
Segment Reporting, Other Significant Reconciling Item [Line Items] | |||
Capital expenditures | 11 | 12 | 14 |
Title and Settlement Services | |||
Segment Reporting, Other Significant Reconciling Item [Line Items] | |||
Capital expenditures | 13 | 9 | 8 |
Corporate and Other | |||
Segment Reporting, Other Significant Reconciling Item [Line Items] | |||
Capital expenditures | $ 22 | $ 14 | $ 13 |
Geographic Region (Details)
Geographic Region (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | ||||||||||||
Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | ||||
Segment Reporting Information [Line Items] | ||||||||||||||
Net revenues | $ 1,444 | $ 1,674 | $ 1,793 | $ 1,203 | $ 1,370 | $ 1,644 | $ 1,662 | $ 1,134 | $ 6,114 | [1],[2] | $ 5,810 | [1],[2] | $ 5,706 | [1],[2] |
Total assets | 7,337 | 7,421 | 7,337 | 7,421 | 7,531 | |||||||||
Net property and equipment | 289 | 267 | 289 | 267 | 254 | |||||||||
United States | ||||||||||||||
Segment Reporting Information [Line Items] | ||||||||||||||
Net revenues | 5,997 | 5,683 | 5,579 | |||||||||||
Total assets | 7,261 | 7,347 | 7,261 | 7,347 | 7,450 | |||||||||
Net property and equipment | 287 | 265 | 287 | 265 | 252 | |||||||||
All Other Countries | ||||||||||||||
Segment Reporting Information [Line Items] | ||||||||||||||
Net revenues | 117 | 127 | 127 | |||||||||||
Total assets | 76 | 74 | 76 | 74 | 81 | |||||||||
Net property and equipment | $ 2 | $ 2 | $ 2 | $ 2 | $ 2 | |||||||||
[1] | Revenues for the Relocation Services segment include intercompany referral commissions paid by the Company Owned Real Estate Brokerage Services segment of $40 million, $43 million and $49 million for the years ended December 31, 2017, 2016 and 2015, respectively. Such amounts are recorded as contra-revenues by the Company Owned Real Estate Brokerage Services segment. There are no other material intersegment transactions. | |||||||||||||
[2] | Transactions between segments are eliminated in consolidation. Revenues for the Real Estate Franchise Services segment include intercompany royalties and marketing fees paid by the Company Owned Real Estate Brokerage Services segment of $311 million, $293 million and $295 million for the years ended December 31, 2017, 2016 and 2015, respectively. Such amounts are eliminated through the Corporate and Other line. |
Selected Quarterly Financial104
Selected Quarterly Financial Data (Unaudited) (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 12 Months Ended | ||||||||||||||||||||
Dec. 31, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | Mar. 31, 2017 | Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | ||||||||||||
Segment Reporting Information [Line Items] | ||||||||||||||||||||||
Net revenues | $ 1,444 | $ 1,674 | $ 1,793 | $ 1,203 | $ 1,370 | $ 1,644 | $ 1,662 | $ 1,134 | $ 6,114 | [1],[2] | $ 5,810 | [1],[2] | $ 5,706 | [1],[2] | ||||||||
Income (Loss) from Continuing Operations before Equity Method Investments, Income Taxes, Extraordinary Items, Noncontrolling Interest [Abstract] | ||||||||||||||||||||||
Income (loss) before income taxes, equity in earnings and noncontrolling interests (b) | 49 | 153 | 183 | (34) | 86 | 176 | 153 | (66) | 351 | 349 | 282 | |||||||||||
Net income (loss) attributable to Realogy Holdings and Realogy Group | $ 255 | $ 95 | $ 109 | $ (28) | $ 57 | $ 106 | $ 92 | $ (42) | $ 431 | $ 213 | $ 184 | |||||||||||
Earnings Per Share, Basic and Diluted [Abstract] | ||||||||||||||||||||||
Basic earnings per share | $ 1.91 | [3] | $ 0.70 | [3] | $ 0.79 | [3] | $ (0.20) | [3] | $ 0.40 | [4] | $ 0.74 | [4] | $ 0.63 | [4] | $ (0.29) | [4] | $ 3.15 | $ 1.47 | $ 1.26 | |||
Diluted earnings per share | $ 1.89 | [3] | $ 0.69 | [3] | $ 0.78 | [3] | $ (0.20) | [3] | $ 0.40 | [4] | $ 0.73 | [4] | $ 0.63 | [4] | $ (0.29) | [4] | $ 3.11 | $ 1.46 | $ 1.24 | |||
Selected Quarterly Financial Information [Abstract] | ||||||||||||||||||||||
Restructuring costs, net | $ 3 | $ 2 | $ 2 | $ 5 | $ 9 | $ 9 | $ 12 | $ 9 | $ 12 | $ 39 | $ 10 | |||||||||||
Former parent legacy benefit, net | 1 | (11) | (3) | 1 | (10) | (2) | (15) | |||||||||||||||
Loss on the early extinguishment of debt | 1 | 4 | 5 | 0 | 48 | |||||||||||||||||
Expense Related to the Transition of the Company's CEO | 8 | 8 | ||||||||||||||||||||
Interest Expense | Interest rate swap contracts | Not Designated as Hedging Instruments | ||||||||||||||||||||||
Selected Quarterly Financial Information [Abstract] | ||||||||||||||||||||||
Derivative, Gain (Loss) on Derivative, Net | 8 | (5) | 1 | 34 | 5 | (14) | (31) | 4 | (6) | (20) | ||||||||||||
Strader | ||||||||||||||||||||||
Selected Quarterly Financial Information [Abstract] | ||||||||||||||||||||||
Legal Fees | 8 | 8 | ||||||||||||||||||||
Real Estate Franchise Services | ||||||||||||||||||||||
Segment Reporting Information [Line Items] | ||||||||||||||||||||||
Net revenues | 199 | 224 | 237 | 170 | 188 | 215 | 221 | 157 | 830 | [1],[2] | 781 | [1],[2] | 755 | [1],[2] | ||||||||
Income (Loss) from Continuing Operations before Equity Method Investments, Income Taxes, Extraordinary Items, Noncontrolling Interest [Abstract] | ||||||||||||||||||||||
Income (loss) before income taxes, equity in earnings and noncontrolling interests (b) | 113 | [5] | 139 | [5] | 146 | [5] | 82 | [5] | 102 | [6] | 133 | [6] | 130 | [6] | 73 | [6] | ||||||
Selected Quarterly Financial Information [Abstract] | ||||||||||||||||||||||
Restructuring costs, net | 1 | |||||||||||||||||||||
Company Owned Real Estate Brokerage Services | ||||||||||||||||||||||
Segment Reporting Information [Line Items] | ||||||||||||||||||||||
Net revenues | 1,087 | 1,267 | 1,392 | 897 | 1,004 | 1,231 | 1,268 | 841 | 4,643 | [1],[2] | 4,344 | [1],[2] | 4,344 | [1],[2] | ||||||||
Income (Loss) from Continuing Operations before Equity Method Investments, Income Taxes, Extraordinary Items, Noncontrolling Interest [Abstract] | ||||||||||||||||||||||
Income (loss) before income taxes, equity in earnings and noncontrolling interests (b) | (14) | [5] | 36 | [5] | 65 | [5] | (35) | [5] | (8) | [6] | 55 | [6] | 63 | [6] | (32) | [6] | ||||||
Selected Quarterly Financial Information [Abstract] | ||||||||||||||||||||||
Restructuring costs, net | 9 | 22 | 5 | |||||||||||||||||||
Relocation Services | ||||||||||||||||||||||
Segment Reporting Information [Line Items] | ||||||||||||||||||||||
Net revenues | 92 | 111 | 102 | 77 | 97 | 116 | 109 | 83 | 382 | [1],[2] | 405 | [1],[2] | 415 | [1],[2] | ||||||||
Income (Loss) from Continuing Operations before Equity Method Investments, Income Taxes, Extraordinary Items, Noncontrolling Interest [Abstract] | ||||||||||||||||||||||
Income (loss) before income taxes, equity in earnings and noncontrolling interests (b) | 15 | [5] | 32 | [5] | 21 | [5] | (5) | [5] | 16 | [6] | 34 | [6] | 22 | [6] | (1) | [6] | ||||||
Selected Quarterly Financial Information [Abstract] | ||||||||||||||||||||||
Restructuring costs, net | 4 | 1 | ||||||||||||||||||||
Title and Settlement Services | ||||||||||||||||||||||
Segment Reporting Information [Line Items] | ||||||||||||||||||||||
Net revenues | 139 | 154 | 157 | 120 | 149 | 164 | 149 | 111 | 570 | [1],[2] | 573 | [1],[2] | 487 | [1],[2] | ||||||||
Income (Loss) from Continuing Operations before Equity Method Investments, Income Taxes, Extraordinary Items, Noncontrolling Interest [Abstract] | ||||||||||||||||||||||
Income (loss) before income taxes, equity in earnings and noncontrolling interests (b) | 6 | [5] | 19 | [5] | 23 | [5] | (3) | [5] | 6 | [6] | 17 | [6] | 21 | [6] | (5) | [6] | ||||||
Selected Quarterly Financial Information [Abstract] | ||||||||||||||||||||||
Restructuring costs, net | 1 | 1 | ||||||||||||||||||||
Other | ||||||||||||||||||||||
Segment Reporting Information [Line Items] | ||||||||||||||||||||||
Net revenues | (73) | [7] | (82) | [7] | (95) | [7] | (61) | [7] | (68) | [8] | (82) | [8] | (85) | [8] | (58) | [8] | (311) | [1],[2],[9] | (293) | [1],[2],[9] | (295) | [1],[2],[9] |
Income (Loss) from Continuing Operations before Equity Method Investments, Income Taxes, Extraordinary Items, Noncontrolling Interest [Abstract] | ||||||||||||||||||||||
Income (loss) before income taxes, equity in earnings and noncontrolling interests (b) | $ (71) | [5] | $ (73) | [5] | $ (72) | [5] | $ (73) | [5] | $ (30) | [6] | $ (63) | [6] | $ (83) | [6] | $ (101) | [6] | ||||||
Selected Quarterly Financial Information [Abstract] | ||||||||||||||||||||||
Restructuring costs, net | $ 1 | $ 8 | $ 4 | |||||||||||||||||||
[1] | Revenues for the Relocation Services segment include intercompany referral commissions paid by the Company Owned Real Estate Brokerage Services segment of $40 million, $43 million and $49 million for the years ended December 31, 2017, 2016 and 2015, respectively. Such amounts are recorded as contra-revenues by the Company Owned Real Estate Brokerage Services segment. There are no other material intersegment transactions. | |||||||||||||||||||||
[2] | Transactions between segments are eliminated in consolidation. Revenues for the Real Estate Franchise Services segment include intercompany royalties and marketing fees paid by the Company Owned Real Estate Brokerage Services segment of $311 million, $293 million and $295 million for the years ended December 31, 2017, 2016 and 2015, respectively. Such amounts are eliminated through the Corporate and Other line. | |||||||||||||||||||||
[3] | Basic and diluted EPS amounts in each quarter are computed using the weighted-average number of shares outstanding during that quarter, while basic and diluted EPS for the full year is computed using the weighted-average number of shares outstanding during the year. Therefore, the sum of the four quarters’ basic or diluted EPS may not equal the full year basic or diluted EPS (see Note 15 "Earnings Per Share" for further information). | |||||||||||||||||||||
[4] | Basic and diluted EPS amounts in each quarter are computed using the weighted-average number of shares outstanding during that quarter, while basic and diluted EPS for the full year is computed using the weighted-average number of shares outstanding during the year. Therefore, the sum of the four quarters’ basic or diluted EPS may not equal the full year basic or diluted EPS. | |||||||||||||||||||||
[5] | The quarterly results include the following:•an $8 million expense related to the settlement of the Strader legal matter in the second quarter;•restructuring charges of $5 million, $2 million, $2 million and $3 million in the first, second, third and fourth quarters, respectively;•former parent legacy net benefit of $11 million in the second quarter and former parent legacy net cost of $1 million in the third quarter;•a loss on the early extinguishment of debt of $4 million and $1 million in the first and third quarters, respectively;•mark-to-market adjustments for interest rate swaps of a $1 million gain, a $5 million loss, and an $8 million gain in the first, second and fourth quarters, respectively; and•an $8 million expense related to the transition of the Company's CEO in the fourth quarter. | |||||||||||||||||||||
[6] | The quarterly results include the following:•former parent legacy net cost of $1 million in the first quarter and former parent legacy net benefit of $3 million in the fourth quarter;•restructuring charges of $9 million, $12 million, $9 million and $9 million in the first, second, third and fourth quarters, respectively; and•mark-to-market adjustments for interest rate swaps of a $31 million loss, a $14 million loss, a $5 million gain, and a $34 million gain in the first, second, third and fourth quarters, respectively. | |||||||||||||||||||||
[7] | Represents the elimination of transactions primarily between the Real Estate Franchise Services segment and the Company Owned Real Estate Brokerage Services segment. | |||||||||||||||||||||
[8] | Represents the elimination of transactions primarily between the Real Estate Franchise Services segment and the Company Owned Real Estate Brokerage Services segment. | |||||||||||||||||||||
[9] | Includes the elimination of transactions between segments. |
Note 19. Subsequent Events S105
Note 19. Subsequent Events Subsequent Events (Details) - USD ($) shares in Millions, $ in Millions | Feb. 28, 2018 | Feb. 26, 2018 | Dec. 31, 2017 | Jan. 31, 2017 | Dec. 31, 2016 | Jul. 20, 2016 | Oct. 23, 2015 | ||
Subsequent Event [Line Items] | |||||||||
Long-term Debt, Gross | [1] | $ 3,580 | |||||||
Secured Debt | Term Loan A | |||||||||
Subsequent Event [Line Items] | |||||||||
Long-term Debt, Gross | $ 391 | [2] | $ 413 | $ 435 | |||||
Secured Debt | Term Loan A | 2019 | |||||||||
Subsequent Event [Line Items] | |||||||||
Annual percentage of original principal amount for quarterly amortization payments | 10.00% | ||||||||
Secured Debt | Term Loan A | 2020 | |||||||||
Subsequent Event [Line Items] | |||||||||
Annual percentage of original principal amount for quarterly amortization payments | 12.50% | ||||||||
Secured Debt | Term Loan B | |||||||||
Subsequent Event [Line Items] | |||||||||
Debt Instrument, Repurchase Amount | $ 1,858 | ||||||||
Long-term Debt, Gross | $ 1,083 | [3] | $ 1,094 | $ 1,100 | |||||
Annual percentage of original principal amount for quarterly amortization payments | 1.00% | ||||||||
Line of Credit | Revolving Credit Facility | |||||||||
Subsequent Event [Line Items] | |||||||||
Line of credit facility borrowing capacity | $ 1,050 | $ 1,050 | $ 815 | ||||||
Subsequent Event | Secured Debt | Term Loan A Facility | |||||||||
Subsequent Event [Line Items] | |||||||||
Debt Instrument, Repurchase Amount | $ 733 | ||||||||
Subsequent Event | Secured Debt | Term Loan A | |||||||||
Subsequent Event [Line Items] | |||||||||
Long-term Debt, Gross | [3] | 750 | |||||||
Long-term Debt, Additional Debt Acquired | [3] | $ 17 | |||||||
Subsequent Event | Secured Debt | Term Loan A | 2019 | |||||||||
Subsequent Event [Line Items] | |||||||||
Annual percentage of original principal amount for quarterly amortization payments | 2.50% | ||||||||
Subsequent Event | Secured Debt | Term Loan A | 2020 | |||||||||
Subsequent Event [Line Items] | |||||||||
Annual percentage of original principal amount for quarterly amortization payments | 2.50% | ||||||||
Subsequent Event | Secured Debt | Term Loan A | 2021 | |||||||||
Subsequent Event [Line Items] | |||||||||
Annual percentage of original principal amount for quarterly amortization payments | 5.00% | ||||||||
Subsequent Event | Secured Debt | Term Loan A | 2022 | |||||||||
Subsequent Event [Line Items] | |||||||||
Annual percentage of original principal amount for quarterly amortization payments | 7.50% | ||||||||
Subsequent Event | Secured Debt | Term Loan A | 2023 | |||||||||
Subsequent Event [Line Items] | |||||||||
Annual percentage of original principal amount for quarterly amortization payments | 10.00% | ||||||||
Subsequent Event | Secured Debt | Term Loan B | |||||||||
Subsequent Event [Line Items] | |||||||||
Debt Instrument, Repurchase Amount | $ 1,083 | ||||||||
Long-term Debt, Gross | [3] | 1,080 | |||||||
Subsequent Event | Line of Credit | Revolving Credit Facility | |||||||||
Subsequent Event [Line Items] | |||||||||
Line of credit facility borrowing capacity | $ 1,400 | ||||||||
Subsequent Event | February 2018 [Member] | |||||||||
Subsequent Event [Line Items] | |||||||||
Stock Repurchase Program, Number of Shares Authorized to be Repurchased | 350 | ||||||||
[1] | Not included in this table is the Company's Unsecured Letter of Credit Facility which had a capacity of $74 million with $69 million utilized at a weighted average rate of 3.24% at December 31, 2017. | ||||||||
[2] | The Term Loan A provided for quarterly amortization payments, which commenced March 31, 2016, totaling per annum 5%, 5%, 7.5%, 10.0% and 12.5% of the original principal amount of the Term Loan A in 2016, 2017, 2018, 2019 and 2020, respectively. The interest rates with respect to term loans under the Term Loan A were based on, at the Company's option, (a) adjusted LIBOR plus an additional margin or (b) ABR plus an additional margin, in each case subject to adjustment based on the then current senior secured leverage ratio. Based on the previous quarter senior secured leverage ratio, the LIBOR margin was 2.00% and the ABR margin was 1.00% for the three months ended December 31, 2017. See Note 19, "Subsequent Events" for a description of the February 2018 refinancing. | ||||||||
[3] | The Term Loan B provided for quarterly amortization payments totaling 1% per annum of the original principal amount. The interest rate with respect to term loans under the Term Loan B was based on, at the Company’s option, (a) adjusted LIBOR plus 2.25% (with a LIBOR floor of 0.75%) or (b) JPMorgan Chase Bank, N.A.’s prime rate ("ABR") plus 1.25% (with an ABR floor of 1.75%). See Note 19, "Subsequent Events" for a description of the February 2018 refinancing. |