Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2015 | Feb. 22, 2016 | Jun. 30, 2015 | |
Document and Entity Information | |||
Entity Registrant Name | Altisource Portfolio Solutions S.A. | ||
Entity Central Index Key | 1,462,418 | ||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2015 | ||
Amendment Flag | false | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Common Stock, Shares Outstanding | 18,839,824 | ||
Entity Treasury Stock | 6,572,924 | ||
Document Fiscal Year Focus | 2,015 | ||
Document Fiscal Period Focus | FY | ||
Entity Public Float | $ 569,714,482 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Current assets: | ||
Cash and cash equivalents | $ 179,327 | $ 161,361 |
Accounts receivable, net | 105,023 | 112,183 |
Prepaid expenses and other current assets | 21,751 | 23,567 |
Deferred tax assets, net | 0 | 4,987 |
Total current assets | 306,101 | 302,098 |
Premises and equipment, net | 119,121 | 127,759 |
Goodwill | 82,801 | 90,851 |
Intangible assets, net | 197,003 | 245,246 |
Deferred Tax Assets | 3,619 | 0 |
Other assets | 19,337 | 22,267 |
Total assets | 727,982 | 788,221 |
Current liabilities: | ||
Accounts payable and accrued expenses | 91,871 | 111,766 |
Current portion of long-term debt | 5,945 | 5,945 |
Deferred revenue | 15,060 | 9,829 |
Other current liabilities | 16,266 | 13,227 |
Total current liabilities | 129,142 | 140,767 |
Long-term debt, less current portion | 528,417 | 582,669 |
Deferred tax liabilities, net | 0 | 2,694 |
Other non-current liabilities | $ 18,153 | $ 20,648 |
Commitments, contingencies and regulatory matters (Note 24) | ||
Equity: | ||
Common stock ($1.00 par value; 25,413 shares authorized and issued and 19,021 outstanding as of December 31, 2015; 25,413 shares authorized and issued and 20,279 outstanding as of December 31, 2014) | $ 25,413 | $ 25,413 |
Additional paid-in capital | 96,321 | 91,509 |
Retained earnings | 369,270 | 367,967 |
Treasury stock, at cost (6,392 shares as of December 31, 2015 and 5,134 shares as of December 31, 2014) | (440,026) | (444,495) |
Altisource equity | 50,978 | 40,394 |
Non-controlling interests | 1,292 | 1,049 |
Total equity | 52,270 | 41,443 |
Total liabilities and equity | $ 727,982 | $ 788,221 |
CONDENSED CONSOLIDATED BALANCE3
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares shares in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Statement of Financial Position [Abstract] | ||
Common stock, par value (in dollars per share) | $ 1 | $ 1 |
Common stock, shares authorized | 25,413 | 25,413 |
Common stock, shares issued | 25,413 | 25,413 |
Common stock, shares outstanding | 19,021 | 20,279 |
Treasury stock, shares | 6,392 | 5,134 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Income Statement [Abstract] | |||
Revenue | $ 1,051,466 | $ 1,078,916 | $ 768,357 |
Cost of revenue | 687,327 | 707,180 | 492,480 |
Gross profit | 364,139 | 371,736 | 275,877 |
Selling, general and administrative expenses | 220,868 | 201,733 | 113,810 |
Impairment losses | 71,785 | 37,473 | 0 |
Business Combination, Contingent Consideration Arrangement - Equator | (7,591) | (37,924) | 0 |
Income from operations | 79,077 | 170,454 | 162,067 |
Other income (expense), net: | |||
Interest expense | (28,208) | (23,363) | (20,291) |
Loss on sale of HLSS equity securities, net of dividends received | (1,854) | 0 | 0 |
Other income (expense), net | 4,045 | 174 | 557 |
Total other income (expense), net | (26,017) | (23,189) | (19,734) |
Income before income taxes and non-controlling interests | 53,060 | 147,265 | 142,333 |
Income tax provision | (8,260) | (10,178) | (8,540) |
Net income | 44,800 | 137,087 | 133,793 |
Net income attributable to non-controlling interests | (3,202) | (2,603) | (3,820) |
Net income attributable to Altisource | $ 41,598 | $ 134,484 | $ 129,973 |
Earnings per share: | |||
Basic (in dollars per share) | $ 2.13 | $ 6.22 | $ 5.63 |
Diluted (in dollars per share) | $ 2.02 | $ 5.69 | $ 5.19 |
Weighted average shares outstanding: | |||
Basic (in shares) | 19,504 | 21,625 | 23,072 |
Diluted (in shares) | 20,619 | 23,634 | 25,053 |
Transactions with related parties included above: | |||
Revenue | $ 666,800 | $ 502,087 | |
Cost of revenue | 38,610 | 19,983 | |
Selling, general and administrative expenses | (268) | 569 | |
Other income | $ 0 | $ 773 |
CONDENSED CONSOLIDATED STATEME5
CONDENSED CONSOLIDATED STATEMENTS OF EQUITY - USD ($) shares in Thousands, $ in Thousands | Total | Common stock | Additional paid-in capital | Retained earnings | Treasury stock, at cost | Non-controlling interests |
Balance at Dec. 31, 2012 | $ 159,829 | $ 25,413 | $ 86,873 | $ 124,127 | $ (77,954) | $ 1,370 |
Balance (in shares) at Dec. 31, 2012 | 25,413 | |||||
Increase (Decrease) in Equity | ||||||
Net income | 133,793 | 129,973 | 3,820 | |||
Contributions from non-controlling interest holders | 28 | 28 | ||||
Distributions to non-controlling interest holders | (4,176) | (4,176) | ||||
Share-based compensation expense | 2,400 | 2,400 | ||||
Exercise of stock options | 6,885 | (14,539) | 21,424 | |||
Value of common stock paid at acquisition | 0 | |||||
Repurchase of shares | (141,018) | (141,018) | ||||
Balance at Dec. 31, 2013 | 157,741 | $ 25,413 | 89,273 | 239,561 | (197,548) | 1,042 |
Balance (in shares) at Dec. 31, 2013 | 25,413 | |||||
Increase (Decrease) in Equity | ||||||
Net income | 137,087 | 134,484 | 2,603 | |||
Distributions to non-controlling interest holders | (2,596) | (2,596) | ||||
Share-based compensation expense | 2,236 | 2,236 | ||||
Exercise of stock options | 2,688 | (6,078) | 8,766 | |||
Value of common stock paid at acquisition | 0 | |||||
Repurchase of shares | (255,713) | (255,713) | ||||
Balance at Dec. 31, 2014 | 41,443 | $ 25,413 | 91,509 | 367,967 | (444,495) | 1,049 |
Balance (in shares) at Dec. 31, 2014 | 25,413 | |||||
Increase (Decrease) in Equity | ||||||
Net income | 44,800 | 41,598 | 3,202 | |||
Distributions to non-controlling interest holders | (2,959) | (2,959) | ||||
Share-based compensation expense | 4,812 | 4,812 | ||||
Exercise of stock options | 1,390 | (8,292) | 9,682 | |||
Issuance of restricted shares for acquisitions | (32,003) | 53,736 | ||||
Value of common stock paid at acquisition | 21,733 | |||||
Repurchase of shares | (58,949) | (58,949) | ||||
Balance at Dec. 31, 2015 | $ 52,270 | $ 25,413 | $ 96,321 | $ 369,270 | $ (440,026) | $ 1,292 |
Balance (in shares) at Dec. 31, 2015 | 25,413 |
CONDENSED CONSOLIDATED STATEME6
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Cash flows from operating activities: | |||
Net income | $ 44,800 | $ 137,087 | $ 133,793 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Depreciation and amortization | 36,470 | 29,046 | 19,056 |
Amortization of intangible assets | 41,135 | 37,680 | 28,176 |
Loss on sale of HLSS equity securities, net of dividends received | 1,854 | 0 | 0 |
Change in the fair value of acquisition related contingent consideration | (7,184) | (37,924) | 0 |
Impairment losses | 71,785 | 37,473 | 0 |
Share-based compensation expense | 4,812 | 2,236 | 2,400 |
Equity in losses of investment in affiliate | 0 | 0 | 176 |
Bad debt expense | 5,514 | 16,257 | 2,549 |
Gain on early extinguishment of debt | (3,836) | 0 | 0 |
Amortization of debt discount | 498 | 317 | 223 |
Amortization of debt issuance costs | 1,374 | 1,151 | 958 |
Deferred income taxes | (1,326) | 1,166 | 2,015 |
Loss on disposal of fixed assets | 26 | 184 | 1,309 |
Changes in operating assets and liabilities, net of effects of acquisitions: | |||
Accounts receivable | 2,401 | (22,492) | (5,602) |
Prepaid expenses and other current assets | 1,883 | (12,501) | (2,817) |
Other assets | 2,993 | (1,750) | (1,586) |
Accounts payable and accrued expenses | (14,483) | 24,285 | 7,381 |
Other current and non-current liabilities | 6,636 | (14,722) | (2,557) |
Net cash provided by operating activities | 195,352 | 197,493 | 185,474 |
Cash flows from investing activities: | |||
Additions to premises and equipment | (36,188) | (64,846) | (34,134) |
Acquisition of businesses, net of cash acquired | (28,675) | (34,720) | (267,946) |
Purchase of HLSS equity securities | (29,966) | 0 | 0 |
Proceeds received from sale of and dividends from HLSS equity securities | 28,112 | 0 | 0 |
Proceeds from loan to Ocwen | 0 | 0 | 75,000 |
Proceeds from sale of equity affiliate | 0 | 0 | 12,648 |
Change in restricted cash | 722 | (1,402) | (1,462) |
Other investing activities | 0 | (300) | (50) |
Net cash used in investing activities | (65,995) | (101,268) | (215,944) |
Cash flows from financing activities: | |||
Proceeds from issuance of long-term debt | 0 | 198,000 | 200,502 |
Repurchases and repayment of long-term debt and payments on capital lease obligations | (50,373) | (4,959) | (3,729) |
Debt issuance costs | 0 | (2,608) | (3,200) |
Proceeds from stock option exercises | 1,390 | 2,688 | 6,885 |
Purchase of treasury stock | (58,949) | (255,713) | (141,018) |
Contributions from non-controlling interests | 0 | 0 | 28 |
Distributions to non-controlling interests | (2,959) | (2,596) | (4,176) |
Other financing activities | (500) | 0 | 0 |
Net cash (used in) provided by financing activities | (111,391) | (65,188) | 55,292 |
Net increase in cash and cash equivalents | 17,966 | 31,037 | 24,822 |
Cash and cash equivalents at the beginning of the period | 161,361 | 130,324 | 105,502 |
Cash and cash equivalents at the end of the period | 179,327 | 161,361 | 130,324 |
Supplemental cash flow information: | |||
Interest paid | 26,274 | 21,829 | 19,325 |
Income taxes paid, net | 9,725 | 13,340 | 3,671 |
Non-cash investing and financing activities: | |||
Acquisition of businesses with restricted shares | 21,733 | 0 | 0 |
(Decrease) increase in payables for purchases of premises and equipment | (6,679) | (2,328) | 4,552 |
Decrease in acquisition of businesses from subsequent working capital true-ups | $ 0 | $ (3,711) | $ (2,039) |
BASIS OF PRESENTATION AND SUMMA
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Dec. 31, 2015 | |
Accounting Policies [Abstract] | |
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Accounting and Presentation - The consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”). Intercompany transactions and accounts have been eliminated in consolidation. Certain prior year amounts reported by the Mortgage Services and Technology Services segments have been reclassified to conform with the current year presentation. Principles of Consolidation - The financial statements include the accounts of the Company, its wholly-owned subsidiaries and those entities in which we have a variable interest and are the primary beneficiary. The Mortgage Partnership of America, L.L.C. (“MPA”), a wholly-owned subsidiary of Altisource, serves as the manager of Best Partners Mortgage Cooperative, Inc., doing business as the Lenders One ® mortgage cooperative (“Lenders One”). MPA provides services to Lenders One under a management agreement that ends on December 31, 2025. MPA acts on behalf of Lenders One and its members principally to provide its members with opportunities to: (i) expand revenue, (ii) reduce loan underwriting costs, (iii) increase operational efficiency and (iv) receive critical education and training. For providing these services, MPA receives payments from Lenders One, and in some instances the vendors, based primarily upon the benefits achieved for the members. The management agreement provides MPA with broad powers such as recruiting members for Lenders One, collection of fees and other obligations from members of Lenders One, processing of all rebates owed to Lenders One and negotiating and executing contracts with vendors including executing contracts on behalf of Lenders One. In September 2014, we launched Best Partners Mortgage Brokers Cooperative, Inc., doing business as the Wholesale One ® Mortgage Cooperative (“Wholesale One”), for the wholesale mortgage market. Wholesale One assists mortgage brokers and wholesale lenders with tools to improve their businesses and obtain better access to the capital markets. In April 2015, we launched Best Partners Residential Investor Cooperative, Inc., doing business as the Residential Investor One™ cooperative (“Residential Investor One”). Residential Investor One was formed to deliver savings and efficiencies to individual and institutional residential real estate investors. MPA provides services to both Wholesale One and Residential Investor One under management agreements that end on July 8, 2039 (with automatic renewals for three successive five-year periods) and March 12, 2040 (with automatic renewals for three successive five-year periods), respectively. The management agreements provide MPA with broad powers such as recruiting members for Wholesale One and Residential Investor One, collection of fees and other obligations from members of Wholesale One and Residential Investor One, processing of all fees owed to Wholesale One and Residential Investor One and negotiating and executing contracts with vendors including executing contracts on behalf of Wholesale One and Residential Investor One. The management agreements between MPA and Lenders One, Wholesale One and Residential Investor One, pursuant to which MPA is the management company of each of these cooperatives, represent variable interests in variable interest entities. MPA is the primary beneficiary of Lenders One, Wholesale One and Residential Investor One as it has the power to direct the activities that most significantly impact each of these cooperatives’ economic performance and the right to receive benefits from each of these cooperatives. As a result, Lenders One, Wholesale One and Residential Investor One are presented in the accompanying consolidated financial statements on a consolidated basis with the interests of the members reflected as non-controlling interests. As of December 31, 2015 , Lenders One had total assets of $4.9 million and total liabilities of $3.7 million . As of December 31, 2014 , Lenders One had total assets of $7.7 million and total liabilities of $6.7 million . As of December 31, 2015 , Wholesale One and Residential Investor One each had less than $0.1 million in total assets and less than $0.1 million in total liabilities (no comparative amounts for 2014 ). Use of Estimates - The preparation of financial statements in conformity with GAAP requires estimates and assumptions that affect the reported amounts of assets and liabilities, revenue and expenses and related disclosures of contingent liabilities in the consolidated financial statements and accompanying notes. Estimates are used for, but not limited to, determining share-based compensation, income taxes, collectability of receivables, valuation of acquired intangibles and goodwill, depreciable lives of fixed assets and contingencies. Actual results could differ materially from those estimates. Cash and Cash Equivalents - We classify all highly liquid instruments with an original maturity of three months or less at the time of purchase as cash equivalents. Accounts Receivable, Net - Accounts receivable are presented net of an allowance for doubtful accounts that represents an amount that we estimate to be uncollectible. We have estimated the allowance for doubtful accounts based on our historical write-offs, our analysis of past due accounts based on the contractual terms of the receivables and our assessment of the economic status of our customers, if known. The carrying value of accounts receivable, net, approximates fair value. Premises and Equipment, Net - We report premises and equipment, net at cost or estimated fair value at acquisition for premises and equipment recorded in connection with a business combination and depreciate these assets over their estimated useful lives using the straight-line method as follows: Furniture and fixtures 5 years Office equipment 5 years Computer hardware 5 years Computer software 3-7 years Leasehold improvements Shorter of useful life, 10 years or the term of the lease Maintenance and repair costs are expensed as incurred. We capitalize expenditures for significant improvements and new equipment and depreciate the assets over the shorter of the capitalized asset’s life or the life of the lease. We review premises and equipment for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset or asset group may not be recoverable. We measure recoverability of assets to be held and used by comparing the carrying amount of an asset or asset group to estimated undiscounted future cash flows expected to be generated by the asset or asset group. If the carrying amount of an asset or asset group exceeds its estimated future cash flows, we recognize an impairment charge for the amount that the carrying value of the asset or asset group exceeds the fair value of the asset or asset group. For the year ended December 31, 2015, we recognized a $4.1 million premises and equipment impairment loss. See Note 9 for additional information. There were no impairments of premises and equipment for the years ended December 31, 2014 and 2013 . Computer software includes the fair value of software acquired in business combinations, capitalized software development costs and purchased software. Capitalized software development and purchased software are recorded at cost and amortized using the straight-line method over its estimated useful life. Software acquired in business combinations is recorded at its fair value and amortized using the straight-line method over its estimated useful life. Business Combinations - We account for acquisitions using the purchase method of accounting in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 805, Business Combinations . The purchase price of an acquisition is allocated to the assets acquired and liabilities assumed using their fair value as of the acquisition date. Goodwill - Goodwill represents the excess cost of an acquired business over the fair value of the identifiable tangible and intangible assets acquired and liabilities assumed in a business combination. We evaluate goodwill for impairment annually during the fourth quarter or more frequently when an event occurs or circumstances change in a manner that indicates the carrying value may not be recoverable. During 2015, we changed the measurement date of our annual goodwill impairment test from November 30 th to December 31 st in order to better align our measurement date with our financial projections. There was no impact of this change. We first assess qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying value as a basis for determining whether we need to perform the quantitative two-step goodwill impairment test. Only if we determine, based on qualitative assessment, that it is more likely than not that a reporting unit’s fair value is less than its carrying value will we calculate the fair value of the reporting unit. We would then test goodwill for impairment by first comparing the book value of net assets to the fair value of the reporting units. If the fair value is determined to be less than the book value, a second step is performed to compute the amount of impairment as the difference between the estimated fair value of goodwill and the carrying value. We estimate the fair value of the reporting units using discounted cash flows. The discounted cash flow method is based on the present value of projected cash flows. Forecasts of future cash flows are based on our estimate of future sales and operating expenses, based primarily on estimated pricing, sales volumes, market segment share, cost trends and general economic conditions. Certain estimates of discounted cash flows involve businesses with limited financial history and developing revenue models. The estimated cash flows are discounted using a rate that represents our weighted average cost of capital. For the years ended December 31, 2015 and 2014, we recognized goodwill impairment losses of $55.7 million and $37.5 million , respectively (no comparative amount in 2013). See Note 10 for additional information. Intangible Assets, Net - Identified intangible assets consist primarily of customer related intangible assets, operating agreements, trademarks and trade names and other intangible assets. Identifiable intangible assets acquired in business combinations are recorded based on their fair values at the date of acquisition. We determine the useful lives of our identifiable intangible assets after considering the specific facts and circumstances related to each intangible asset. Factors we consider when determining useful lives include the contractual term of any arrangements, the history of the asset, our long-term strategy for use of the asset and other economic factors. We amortize intangible assets that we deem to have definite lives in proportion to actual and expected customer revenues or on a straight-line basis over their useful lives, generally ranging from 4 to 20 years. We perform tests for impairment if conditions exist that indicate the carrying value may not be recoverable. When facts and circumstances indicate that the carrying value of intangible assets determined to have definite lives may not be recoverable, management assesses the recoverability of the carrying value by preparing estimates of cash flows of discrete intangible assets consistent with models utilized for internal planning purposes. If the sum of the undiscounted expected future cash flows is less than the carrying value, we would recognize an impairment to the extent the carrying amount exceeds fair value. For the year ended December 31, 2015, we recognized impairments of intangible assets of $11.9 million (no comparative amounts in 2014 and 2013). See Note 10 for additional information on impairments. Debt Issuance Costs - Debt issuance costs are capitalized and amortized to interest expense through maturity of the related debt using the effective interest method. Long-Term Debt - Long-term debt is reported net of applicable discount or premium. The debt discount or premium is amortized to interest expense through maturity of the related debt using the effective interest method. Fair Value Measurements - Fair value is defined as an exit price, representing the amount that would be received for an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The three-tier hierarchy for inputs used in measuring fair value, which prioritizes the inputs used in the methodologies of measuring fair value for assets and liabilities, is as follows: Level 1 — Quoted prices in active markets for identical assets and liabilities Level 2 — Observable inputs other than quoted prices included in Level 1 Level 3 — Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of assets or liabilities. Financial assets and financial liabilities are classified based on the lowest level of input that is significant to the fair value measurements. Our assessment of the significance of a particular input to the fair value measurements requires judgment and may affect the valuation of the assets and liabilities being measured and their placement within the fair value hierarchy. Functional Currency - The currency of the primary economic environment in which our operations are conducted is the United States dollar. Therefore, the United States dollar has been determined to be our functional and reporting currency. Non-United States dollar transactions and balances have been measured in United States dollars in accordance with ASC Topic 830, Foreign Currency Matters . All transaction gains and losses from the measurement of monetary balance sheet items denominated in non-United States dollar currencies are reflected in the consolidated statements of operations as income or expenses, as appropriate. Defined Contribution 401(k) Plan - Some of our employees currently participate in a defined contribution 401(k) plan under which we may make matching contributions equal to a discretionary percentage determined by us. We recorded expenses of $1.0 million , $0.9 million and $0.4 million for the years ended December 31, 2015 , 2014 and 2013 , respectively, related to our discretionary amounts contributed. Share-Based Compensation - Share-based compensation is accounted for under the provisions of ASC Topic 718, Compensation - Stock Compensation . Under ASC Topic 718, the cost of employee services received in exchange for an award of equity instruments is generally measured based on the grant date fair value of the award. Share-based awards that do not require future service are expensed immediately. Share-based employee awards that require future service are recognized over the relevant service period. Further, as required under ASC Topic 718, we estimate forfeitures for share-based awards that are not expected to vest. Earnings Per Share - We compute earnings per share (“EPS”) in accordance with ASC Topic 260, Earnings Per Share . Basic net income per share is computed by dividing net income attributable to Altisource by the weighted average number of shares of common stock outstanding for the period. Diluted net income per share reflects the assumed conversion of all dilutive securities. Revenue Recognition - We recognize revenue from the services we provide in accordance with ASC Topic 605, Revenue Recognition . ASC Topic 605 sets forth guidance as to when revenue is realized or realizable and earned, which is generally when all of the following criteria are met: (1) persuasive evidence of an arrangement exists; (2) delivery has occurred or services have been performed; (3) the seller’s price to the buyer is fixed or determinable; and (4) collectability is reasonably assured. Generally, the contract terms for these services are relatively short in duration, and we recognize revenue as the services are performed either on a per unit or a fixed price basis. Specific policies for each of our reportable segments are as follows: Mortgage Services segment : We recognize revenue for the majority of the services we provide when the services have been performed. For default processing services and certain property preservation services, we recognize revenue over the period during which we perform the related services, with full recognition upon recording the related foreclosure deed or on closing of the related real estate transaction. We record revenue associated with real estate sales on a net basis as we perform services as an agent without assuming the risks and rewards of ownership of the asset and the commission earned on the sale is a fixed percentage. Reimbursable expenses of $107.2 million , $137.4 million and $102.0 million incurred for the years ended December 31, 2015 , 2014 and 2013 , respectively, are included in revenue with an equal offsetting expense included in cost of revenue primarily related to our property preservation and default processing services. These amounts are recognized on a gross basis, principally because we have complete control over selection of vendors and the vendor relationship is with us, rather than with our customers. Financial Services segment : We generally earn our fees for asset recovery management services as a percentage of the amount we collect on delinquent consumer receivables and charged-off mortgages on behalf of our clients and recognize revenue upon collection from the debtors. We also earn fees for packaging and selling charged-off mortgages and recognize revenue after the sale of the notes and once the risks and rewards of the mortgage notes are transferred to the purchasers. In addition, we provide customer relationship management services for which we earn and recognize revenue on a per-person, per-call or per-minute basis as the related services are performed. Technology Services segment : For our software services, we charge based on the number of loans on the system or on a per-transaction basis. We record transactional revenue when the service is provided and other revenue monthly based on the number of loans processed or services provided. In addition, we charge fees for professional services engagements, which consist primarily of time and materials agreements with customers that are generally billed and recognized as the hours are worked. For Equator software applications, we recognize revenue from arrangements with multiple deliverables in accordance with ASC Subtopic 605-25, Revenue Recognition: Multiple-Element Arrangements (“ASC 605-25”), and Securities and Exchange Commission (“SEC”) Staff Accounting Bulletin Topic 13, Revenue Recognition (“SAB Topic 13”). ASC 605-25 and SAB Topic 13 require each deliverable within a multiple-deliverable revenue arrangement to be accounted for as a separate unit if both of the following criteria are met: (1) the delivered item or items have value to the customer on a standalone basis and (2) for an arrangement that includes a general right of return relative to the delivered item(s), delivery or performance of the undelivered item(s) is considered probable and substantially in the seller’s control. Deliverables not meeting the criteria for accounting treatment as a separate unit are combined with a deliverable that meets that criterion. We derive revenue from platform services fees, professional services fees and other services. We do not begin to recognize revenue for platform services fees until these fees become billable, as the services fees are not fixed and determinable until such time. Platform services fees are recognized ratably over the shorter of the term of the contract with the customer or the minimum cancellation period. Professional services fees consist primarily of configuration services related to customizing the platform for individual customers and are generally billed as the hours are worked. Due to the essential and specialized nature of the configuration services, these services do not qualify as separate units of accounting separate from the platform services as the delivered services do not have value to the customer on a standalone basis. Therefore, the related fees are recorded as deferred revenue until the project configuration is complete and then recognized ratably over the longer of the term of the agreement or the estimated expected customer life. Other services consist primarily of training, including agent certification, and consulting services. These services are generally sold separately and are recognized as revenue as the services are performed and earned. For Mortgage Builder software applications, we recognize subscription revenues ratably over the contract term, beginning on the commencement date of each contract. Revenues for usage-based transactions are generally recognized as the usage occurs, as that is the point when the fee becomes fixed or determinable. We generally invoice customers on a monthly basis. We provide information technology infrastructure services to Ocwen Financial Corporation and its subsidiaries (“Ocwen”), Altisource Residential Corporation (“Residential”) and Altisource Asset Management Corporation (“AAMC”) and charge for these services primarily based on the number of employees that are using the applicable systems and the number and type of licensed platforms used by Ocwen, Residential and AAMC. We record revenue associated with implementation services upon completion and maintenance ratably over the related service period. Significant areas of judgment include the period over which we recognize property preservation revenue and certain default management services revenue. Income Taxes - We account for certain income and expense items differently for financial reporting purposes and income tax purposes. We recognize deferred income tax assets and liabilities for these differences between the financial reporting basis and the tax basis of our assets and liabilities as well as expected benefits of utilizing net operating loss and credit carryforwards. The most significant temporary differences relate to accrued compensation, amortization and loss and credit carryforwards. We measure deferred income tax assets and liabilities using enacted tax rates expected to apply to taxable income in the years in which we anticipate recovery or settlement of those temporary differences. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period when the change is enacted. Deferred tax assets are reduced by a valuation allowance when it is more likely than not that some portion or all of the deferred tax assets will not be realized. In 2015, the Company early-adopted FASB Accounting Standards Update (“ASU”) No. 2015-17, Income Taxes (Topic 740): Balance Sheet Classification of Deferred Taxes . This standard simplifies the presentation of deferred taxes by requiring that deferred tax assets and deferred tax liabilities be classified as non-current in an entity’s balance sheet. We have adopted this standard prospectively. Accordingly, prior periods were not retrospectively adjusted. Tax laws are complex and subject to different interpretations by the taxpayer and respective governmental taxing authorities. Significant judgment is required in determining tax expense and in evaluating tax positions including evaluating uncertainties under ASC Topic 740, Income Taxes (“ASC Topic 740”). We recognize tax benefits from uncertain tax positions only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. The tax benefits recognized in the financial statements from such positions are then measured based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement. Resolution of these uncertainties in a manner inconsistent with management’s expectations could have a material impact on our results of operations. Future Adoption of New Accounting Pronouncements In May 2014, FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606) . This standard establishes a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most current revenue recognition guidance. The core principle of the new standard is an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. In August 2015, in response to stakeholders’ requests to defer the effective date of ASU 2014-09 and in consideration of feedback received through extensive outreach with preparers, practitioners and users of financial statements, the FASB deferred the effective date for all entities by one year. This new standard will be effective for annual reporting periods beginning after December 15, 2017, including interim periods within that reporting period. Early adoption is permitted, although not prior to annual reporting periods beginning after December 15, 2016. The Company is currently evaluating the impact this new guidance may have on its results of operations and financial position. In February 2015, FASB issued ASU No. 2015-02, Consolidation (Topic 810): Amendments to the Consolidation Analysis . This standard addresses the consolidation of certain legal entities relative to current requirements under GAAP of a reporting entity to consolidate another legal entity in situations in which the reporting entity’s contractual rights do not give it the ability to act primarily on its own behalf, the reporting entity does not hold a majority of the legal entity’s voting rights or the reporting entity is not exposed to a majority of the legal entity’s economic benefits or obligations. This standard will be effective for annual reporting periods beginning after December 15, 2015, including interim periods within that reporting period. Early adoption is permitted, including adoption in an interim period. If an entity early adopts the standard in an interim period, any adjustments should be reflected as of the beginning of the year that includes that interim period. The Company does not expect the adoption of this standard to have a material impact on its results of operations or financial position. In April 2015, FASB issued ASU No. 2015-03, Interest-Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs. This standard changes the presentation of debt issuance costs in financial statements. Under the ASU, an entity presents such costs in the balance sheet as a direct deduction from the related debt liability rather than as an asset. This standard will be effective for annual reporting periods beginning after December 15, 2015, including interim periods within that reporting period. Early adoption is permitted for financial statements that have not been previously issued. As of December 31, 2015, the Company’s total non-current assets were $421.9 million (including other assets of $19.3 million ), net long-term debt (including current portion) was $534.4 million and debt issuance costs, net of amortization, were $6.2 million (included in other assets). As of December 31, 2015, adoption of this ASU would have reduced other assets and net long-term debt by $6.2 million . Consequently, the Company does not expect the adoption of this standard to have a material impact on its results of operations or financial position. In September 2015, FASB issued ASU No. 2015-16, Business Combinations (Topic 805): Simplifying the Accounting for Measurement-Period Adjustments . This standard requires that adjustments to provisional amounts that are identified during the measurement period are recognized in the reporting period in which the adjustment amounts are determined rather than recognizing the adjustments retrospectively. The standard also requires that the acquirer records, in the same period’s financial statements, the effect on earnings of changes in depreciation, amortization or other income effects, if any, as a result of the change to the provisional amounts, calculated as if the accounting had been completed at the acquisition date. This standard will be effective for annual reporting periods beginning after December 15, 2015, including interim periods within that reporting period. Early adoption is permitted for financial statements that have not been previously issued. The Company does not expect the adoption of this standard to have a material impact on its results of operations or financial position. In January 2016, FASB issued ASU No. 2016-01, Financial Instruments - Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities . This standard will require equity investments (except those accounted for under the equity method of accounting or those that result in consolidation of the investee) to be measured at fair value with changes in fair value recognized in net income. The standard also simplifies the impairment assessment of equity investments without readily determinable fair values by requiring a qualitative assessment to identify impairment. When a qualitative assessment indicates that impairment exists, an entity is required to measure the investment at fair value. It also amends certain financial statement presentation and disclosure requirements associated with the fair value of financial instruments. This standard will be effective for annual periods beginning after December 15, 2017, including interim periods within that reporting period. Early adoption is not permitted. The Company is currently evaluating the impact this new guidance may have on its results of operations and financial position. In February 2016, FASB issued ASU No. 2016-02, Leases (Topic 842) . This new standard introduces a new lessee model that brings substantially all leases on the balance sheet. The standard will require companies to recognize lease assets and lease liabilities on their balance sheets and disclose key information about leasing arrangements in their financial statements. This standard will be effective for annual periods beginning after December 15, 2018, including interim periods within that reporting period. Early application of this standard is permitted. The Company is currently evaluating the impact this new guidance may have on its results of operations and financial position. |
ORGANIZATION
ORGANIZATION | 12 Months Ended |
Dec. 31, 2015 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
ORGANIZATION | ORGANIZATION Description of Business Altisource Portfolio Solutions S.A., together with its subsidiaries (which may be referred to as “Altisource,” the “Company,” “we,” “us” or “our”), is a premier marketplace and transaction solutions provider for the real estate, mortgage and consumer debt industries. Altisource’s proprietary business processes, vendor and electronic payment management software and behavioral science-based analytics improve outcomes for marketplace participants. We conduct our operations through three reportable segments: Mortgage Services, Financial Services and Technology Services. In addition, we report our corporate related expenditures and eliminations separately (see Note 25 for a description of our business segments). |
CUSTOMER CONENTRATION
CUSTOMER CONENTRATION | 12 Months Ended |
Dec. 31, 2015 | |
Concentration Risk(2014 Values with Related Party Entity) | |
Concentration Risk Disclosure [Text Block] | CUSTOMER CONCENTRATION Ocwen is our largest customer. Ocwen purchases certain mortgage services and technology services from us under the terms of master services agreements and amendments to master services agreements (collectively, the “Service Agreements”) with terms extending through August 2025. Certain of the Service Agreements, among other things, contain a “most favored nation” provision and the parties to the Service Agreements have the right to renegotiate pricing. Ocwen has also agreed not to develop similar fee-based businesses that would directly or indirectly compete with the services provided by Altisource to Ocwen with respect to the Homeward Residential, Inc. (“Homeward”) and Residential Capital, LLC (“ResCap”) portfolios. In addition, Ocwen purchases certain origination services from Altisource under an agreement that extends through January 2017. Revenue from Ocwen primarily consists of revenue earned directly from Ocwen and revenue earned from the loans serviced by Ocwen when Ocwen designates us as the service provider. Revenue from Ocwen as a percentage of segment and consolidated revenue was as follows for the years ended December 31: 2015 2014 2013 Mortgage Services 63% 67% 70% Financial Services 21% 27% 30% Technology Services 54% 42% 50% Consolidated revenue 60% 60% 65% For the years ended December 31, 2015 , 2014 and 2013 , we generated revenue from Ocwen of $631.6 million , $650.7 million and $499.3 million , respectively. Services provided to Ocwen during such periods and reported in the Mortgage Services segment included real estate asset management and sales, residential property valuation, trustee management services, property inspection, property preservation and insurance services. Services provided to Ocwen and reported in the Financial Services segment included mortgage charge-off collections. Services provided to Ocwen and reported in the Technology Services segment included information technology infrastructure management and software applications including our software platforms. As of December 31, 2015 , accounts receivable from Ocwen totaled $38.2 million , $20.4 million of which was billed and $17.8 million of which was unbilled (see Note 7 for additional information on billed and unbilled accounts receivable). We earn additional revenue related to the portfolios serviced by Ocwen when a party other than Ocwen selects Altisource as the service provider. For the years ended December 31, 2015 , 2014 and 2013 , we recognized revenue of $216.9 million , $256.0 million and $161.9 million , respectively, related to the portfolios serviced by Ocwen when a party other than Ocwen selected Altisource as the service provider. These amounts are not included in deriving revenue from Ocwen as a percentage of revenue in the table above. |
TRANSACTIONS WITH RELATED PARTI
TRANSACTIONS WITH RELATED PARTIES | 12 Months Ended |
Dec. 31, 2015 | |
Related Party Transactions [Abstract] | |
TRANSACTIONS WITH RELATED PARTIES | TRANSACTIONS WITH RELATED PARTIES Through January 16, 2015, William C. Erbey served as our Chairman as well as the Executive Chairman of Ocwen and Chairman of each of Home Loan Servicing Solutions, Ltd. (“HLSS”), Residential and AAMC. Effective January 16, 2015, Mr. Erbey stepped down as the Executive Chairman of Ocwen and Chairman of each of Altisource, HLSS, Residential and AAMC and is no longer a member of the Board of Directors for any of these companies. Consequently, these companies are no longer related parties of Altisource, as defined by FASB ASC Topic 850, Related Party Disclosures . The disclosures in this note are limited to the periods that each of Ocwen, HLSS, Residential and AAMC were related parties of Altisource and are not necessarily reflective of current activities with these former related parties. Ocwen Revenue For the years ended December 31, 2014 and 2013 , we generated revenue from Ocwen of $650.7 million and $499.3 million , respectively. For the period from January 1, 2015 through January 16, 2015, we estimated that we generated revenue from Ocwen of $22.9 million . Services provided to Ocwen during such periods included real estate asset management and sales, residential property valuation, trustee management services, property inspection and preservation, insurance services, mortgage charge-off collections, information technology infrastructure management and software applications including our software platforms. As of December 31, 2014 , accounts receivable from Ocwen totaled $37.4 million , $22.8 million of which was billed and $14.6 million of which was unbilled (see Note 7 for additional information on billed and unbilled accounts receivable). We record revenue we earn from Ocwen under the Service Agreements at rates we believe to be comparable market rates as we believe they are consistent with the fees we charge to other customers and/or fees charged by our competitors for comparable services. Cost of Revenue and Selling, General and Administrative Expenses At times, we have used Ocwen’s contractors and/or employees to support Altisource related services. Ocwen generally bills us for these contractors and/or employees based on their fully-allocated cost. Additionally, through March 31, 2015, we purchased certain data relating to Ocwen’s servicing portfolio in connection with a Data Access and Services Agreement. Based upon our previously provided notice, the Data Access and Services Agreement was terminated effective March 31, 2015. For the years ended December 31, 2014 and 2013 , Ocwen billed us $38.6 million and $20.0 million , respectively, for these items. For the period from January 1, 2015 through January 16, 2015, we estimated that we incurred $1.9 million of expenses related to these items. These amounts are reflected as a component of cost of revenue in the consolidated statements of operations. We provide certain other services to Ocwen and Ocwen provides certain other services to us in connection with Support Services Agreements. These services included such areas as human resources, vendor management, vendor oversight, corporate services, facilities related services, quality assurance, quantitative analytics, tax and treasury. Billings for these services were generally based on the fully-allocated cost of providing the service based on an estimate of the time and expense of providing the service or estimates thereof. For the years ended December 31, 2014 and 2013 , we billed Ocwen $4.5 million and $2.8 million , respectively, for these items. For the years ended December 31, 2014 and 2013 , Ocwen billed us $6.1 million and $4.6 million , respectively, for these items. Of the January 2015 billings to Ocwen, we estimated that $0.1 million related to the period from January 1, 2015 through January 16, 2015. Of the January 2015 billings from Ocwen, we estimated that $0.3 million related to the period from January 1, 2015 through January 16, 2015. These amounts are reflected as a component of selling, general and administrative expenses in the consolidated statements of operations. As of December 31, 2014 , accounts payable and accrued expenses payable to Ocwen totaled $11.6 million (see Note 13). Unsecured Term Loan On December 27, 2012, we entered into a senior unsecured term loan agreement with Ocwen under which we loaned $75.0 million to Ocwen. Payments of interest were due quarterly at a rate per annum equal to the Eurodollar Rate (as defined in the agreement) plus 6.75% , provided that the Eurodollar Rate was not less than 1.50% . On February 15, 2013, Ocwen repaid the outstanding principal amount of this loan and all accrued and unpaid interest and the term loan was terminated. Interest income related to this loan was $0.8 million for the year ended December 31, 2013 ( no comparative amounts for 2015 and 2014 ). Transactions Related to Fee-Based Businesses On January 31, 2013, we entered into non-binding letters of intent with Ocwen to acquire certain fee-based businesses associated with Ocwen’s acquisitions of the Homeward and ResCap servicing portfolios. Ocwen acquired the Homeward servicing portfolio on December 27, 2012 and the ResCap servicing portfolio on February 15, 2013. Altisource acquired the Homeward fee-based businesses from Ocwen on March 29, 2013 (see Note 5). Altisource entered into an agreement with Ocwen on April 12, 2013 to establish additional terms related to our services in connection with the ResCap fee-based businesses (see Note 5). Correspondent One and HLSS In July 2011, we acquired an equity interest in Correspondent One S.A. (“Correspondent One”). Correspondent One purchased closed conforming and government guaranteed residential mortgages from approved mortgage bankers. On March 31, 2013, we sold our 49% interest in Correspondent One to Ocwen for $12.6 million . Prior to the sale to Ocwen, we provided Correspondent One certain finance, human resources, legal support, facilities, technology, vendor management and insurance risk management services under a support services agreement. For the year ended December 31, 2013 , we billed Correspondent One less than $0.1 million ( no comparative amounts for 2015 and 2014 ). This amount is reflected as a component of selling, general and administrative expenses in the consolidated statements of operations. We also provided certain origination related services to Correspondent One. We earned revenue of $0.1 million for the year ended December 31, 2013 for these services ( no comparative amounts for 2015 and 2014 ). Prior to April 2015, HLSS was a publicly traded company whose primary objective was the acquisition of mortgage servicing rights and related servicing advances, loans held for investment and other residential mortgage related assets. We provided HLSS certain finance, human resources, tax and facilities services and sold information technology services to HLSS under a support services agreement. For the years ended December 31, 2014 and 2013 , we billed HLSS $0.9 million and $0.7 million , respectively. For the period from January 1, 2015 through January 16, 2015, our billings to HLSS were immaterial. These amounts are reflected as a reduction of selling, general and administrative expenses in the consolidated statements of operations. As of December 31, 2014 , accounts receivable from HLSS was $0.1 million (see Note 7 for additional information on billed accounts receivable). Residential and AAMC Residential and AAMC were separated from Altisource on December 21, 2012, their equity was distributed to our shareholders on December 24, 2012 and they are each separate publicly traded companies. Residential is focused on acquiring and managing single family rental properties throughout the United States. Residential has historically acquired its rental properties primarily through the acquisition of sub-performing and non-performing mortgage loan portfolios. However, given evolving market conditions, commencing in 2015, Residential expanded its acquisition strategy to opportunistically acquire portfolios of single family rental properties. Residential also commenced a program to begin purchasing properties on a one-by-one basis sourcing listed properties from the Multiple Listing Service and alternative listing sources. AAMC’s primary business is to provide portfolio management and corporate governance services to investment vehicles that own real estate assets. Currently, AAMC’s primary client is Residential. For purposes of governing certain ongoing relationships between Altisource, Residential and AAMC, we entered into certain agreements with Residential and AAMC. We have agreements, which extend through 2027, to provide Residential with renovation management, lease management, property management and real estate owned asset management services. In addition, we have agreements with Residential and AAMC pursuant to which we may provide services such as finance, human resources, facilities, technology and insurance risk management. Further, we have separate agreements for certain services related to income tax matters, trademark licenses and technology products and services. For the years ended December 31, 2014 and 2013 , we generated revenue from Residential of $16.0 million and $2.6 million , respectively, under these services agreement. For the period from January 1, 2015 through January 16, 2015, we estimated that we generated revenue from Residential of $1.0 million . These amounts are reflected in revenue in the consolidated statements of operations. This excludes revenue from services we provided to Residential’s loans serviced by Ocwen or other loan servicers where we were retained by Ocwen or Residential’s other loan servicers. The revenue associated with Residential’s loans serviced by Ocwen is included in Ocwen related party revenue for the years ended December 31, 2014 and 2013 . As of December 31, 2014 , accounts receivable from Residential was $11.3 million (see Note 7 for additional information on billed accounts receivable). For the year ended December 31, 2014 , we billed AAMC $1.0 million under these services agreements, $0.1 million of which is reflected in revenue and $0.9 million of which is reflected as a component of selling, general and administrative expenses in the consolidated statements of operations. For the year ended December 31, 2013 , we billed AAMC $0.5 million under these services agreements, less than $0.1 million of which is reflected in revenue and $0.5 million of which is reflected as a component of selling, general and administrative expenses in the consolidated statements of operations. For the period from January 1, 2015 through January 16, 2015, our billings to AAMC were immaterial. As of December 31, 2014 , accounts receivable from AAMC was $0.1 million (see Note 7 for additional information on billed accounts receivable). |
ACQUISITIONS
ACQUISITIONS | 12 Months Ended |
Dec. 31, 2015 | |
Business Combinations [Abstract] | |
ACQUISITIONS | ACQUISITIONS RentRange, Investability and Onit Solutions Acquisitions On October 9, 2015, we acquired GoldenGator, LLC (doing business as RentRange ® ), REIsmart, LLC (doing business as Investability ™ ) and Onit Solutions, LLC, a support company for RentRange and Investability (collectively, the “Acquired RentRange and Investability Businesses”). RentRange is a leading provider of rental home data and information to the financial services and real estate industries, delivering a wide assortment of address and geography level data, analytics, and rent-based valuation solutions for single and multi-family properties. Investability is an online residential real estate search and acquisition platform that utilizes data and analytics to allow real estate investors to access the estimated cash flow, capitalization rate, net yield and market value of properties for sale in the United States. The purchase price of $24.8 million was composed of $17.5 million in cash and 247 thousand shares of restricted common stock of the Company with a value of $7.3 million as of the closing date. The restricted stock is subject to transfer restrictions and potential forfeiture provisions upon issuance. These restrictions and forfeiture provisions will be removed over a four year period, subject to meeting certain continued employment conditions with the Company and meeting certain acquisition related escrow release conditions. The Acquired RentRange and Investability Businesses are not material in relation to the Company’s results of operations or financial position. The preliminary allocation of the purchase price is as follows: (in thousands) Cash $ 3 Accounts receivable, net 245 Premises and equipment, net 1,206 Other assets 199 Software 1,265 Trademarks and trade names 1,205 Databases/other 910 Non-compete agreements 330 Customer relationships 255 Goodwill 19,565 25,183 Accounts payable and accrued expenses (391 ) Purchase price $ 24,792 CastleLine Acquisition On July 17, 2015, we acquired CastleLine Holdings, LLC and its subsidiaries (“CastleLine”), a specialty risk management and insurance services firm. CastleLine provides financial products and services to parties involved in the origination, underwriting, purchase and securitization of residential mortgages. The purchase consideration was composed of $12.3 million of cash at closing, $10.5 million of cash payable over four years from the acquisition date and 495 thousand shares of restricted common stock of the Company with a value of $14.4 million as of the closing date. Of the cash payable following acquisition, $3.8 million is contingent on certain future employment conditions of certain of the sellers, and therefore excluded from the purchase price. The CastleLine acquisition is not material in relation to the Company’s results of operations or financial position. The preliminary allocation of the purchase price is as follows: (in thousands) Cash $ 1,088 Accounts receivable, net 510 Prepaid expenses 66 Restricted cash 2,501 Non-compete agreements 1,105 Databases/other 465 Customer relationships 395 Trademarks and trade names 150 Goodwill 28,125 34,405 Accounts payable and accrued expenses (875 ) Deferred revenue (87 ) Purchase price $ 33,443 Owners Acquisition On November 21, 2014, we acquired certain assets and assumed certain liabilities of Owners Advantage, LLC (“Owners”). Owners is a self-directed online real estate marketplace. We paid $19.8 million at closing in cash and agreed to pay additional contingent consideration of up to an additional $7.0 million over two years following the closing (“Owners Earn Out”), based on Adjusted Revenue (as defined in the purchase agreement). At closing, we estimated the fair value of the Owners Earn Out to be $1.9 million determined based on the present value of future estimated Owners Earn Out payments. After the acquisition date, the allocation of the purchase price was adjusted based upon information that subsequently became available relating to acquisition date working capital, resulting in a payment to the sellers of less than $0.1 million . The Owners acquisition and the adjustment to the preliminary allocation of the purchase price are not material in relation to the Company’s results of operations or financial position. The final allocation of the purchase price is as follows: (in thousands) Accounts receivable, net $ 32 Prepaid expenses 28 Software 501 Trademarks and trade names 1,431 Goodwill 19,775 21,767 Accounts payable (22 ) Purchase price $ 21,745 Mortgage Builder Acquisition On September 12, 2014, we acquired certain assets and assumed certain liabilities of Mortgage Builder Software, Inc. (“Mortgage Builder”) pursuant to a Purchase and Sale Agreement dated July 18, 2014 (the “Purchase and Sale Agreement”). Mortgage Builder is a provider of residential mortgage loan origination and servicing software systems. Pursuant to the terms of the Purchase and Sale Agreement, we paid $15.7 million at closing in cash (net of closing working capital adjustments). Additionally, the Purchase and Sale Agreement provides for the payment of up to $7.0 million in potential additional consideration (the “MB Earn-Out”) based on Adjusted Revenue (as defined in the Purchase and Sale Agreement) in the three consecutive 12-month periods following closing. At closing, we estimated the fair value of the MB Earn-Out to be $1.6 million determined based on the present value of future estimated MB Earn-Out payments. After the acquisition date, the allocation of the purchase price was adjusted based upon information that subsequently became available relating to acquisition date working capital, resulting in an obligation of the sellers to pay the Company $0.2 million . The Mortgage Builder acquisition and the adjustment to the preliminary allocation of the purchase price are not material in relation to the Company’s results of operations or financial position. The final adjusted allocation of the purchase price is as follows: (in thousands) Cash $ 668 Accounts receivable, net 1,102 Prepaid expenses 38 Premises and equipment, net 553 Software 1,509 Trademarks and trade names 209 Customer relationships 4,824 Goodwill 9,135 18,038 Accounts payable and accrued expenses (950 ) Purchase price $ 17,088 See Note 10 for additional information on the impairment of Technology Services goodwill for the year ended December 31, 2015, which includes Mortgage Builder goodwill. Equator Acquisition On November 15, 2013, we completed the acquisition of all of the outstanding limited liability company interests of Equator, LLC (“Equator”) pursuant to a Purchase and Sale Agreement dated August 19, 2013 (the “Purchase Agreement”). Pursuant to the terms of the Purchase Agreement, we paid $63.4 million at closing in cash (net of closing working capital adjustments), subject to certain post-closing adjustments based on current assets and current liabilities of Equator at closing. After the acquisition date, management adjusted the purchase price allocation based upon information that has subsequently become available relating to acquisition date working capital, resulting in an obligation of the Company to pay the sellers an additional $3.7 million . Consequently, the Company retrospectively adjusted the fair value of the assets acquired and liabilities assumed in the consolidated balance sheet as of December 31, 2013 as well as disclosed the corresponding amount of non-cash investing and financing activities in the consolidated statement of cash flows for the year ended December 31, 2014 . The Purchase Agreement also provided for the payment of up to $80 million in potential additional consideration (“Equator Earn Out”). The Equator Earn Out was determined based on Equator’s Adjusted EBITA (as defined in the Purchase Agreement) in the three consecutive 12 -month periods following closing. Up to $22.5 million of the Equator Earn Out could be earned in each of the first two 12 -month periods and up to $35.0 million could be earned in the third 12-month period. Any amounts earned upon the achievement of Adjusted EBITA thresholds would be payable through 2017. We could have, at our discretion, paid up to 20% of each payment of any of the Equator Earn Out in shares of Company restricted stock, with the balance paid in cash. As of the closing date, we estimated the fair value of the Equator Earn Out to be $46.0 million , determined based on the present value of future estimated Equator Earn Out payments at such date, which has subsequently been reduced to $0 with a settlement payment of $0.5 million , as further described below and in Note 6. The acquisition date fair value of the Equator Earn Out is included as a component of the purchase price of Equator. Initial purchase price allocation Adjustments Adjusted purchase price allocation (in thousands) Accounts receivable $ 9,293 $ 3,490 $ 12,783 Prepaid expenses and other current assets 954 (393 ) 561 Premises and equipment 16,974 — 16,974 Customer relationships, trademarks and trade names 43,393 — 43,393 Goodwill 82,460 — 82,460 Other non-current assets 242 78 320 Assets acquired 153,316 3,175 156,491 Accounts payable and accrued expenses (7,232 ) 536 (6,696 ) Deferred revenue (36,689 ) — (36,689 ) Liabilities assumed (43,921 ) 536 (43,385 ) Purchase price $ 109,395 $ 3,711 $ 113,106 Estimated life (in years) Premises and equipment (excluding internally developed software) 3 - 5 Internally developed software (included in premises and equipment) 7 Customer relationships (weighted average) 15 Trade names 4 In accordance with ASC Topic 805, Business Combinations , the liability for contingent consideration is reflected at fair value and adjusted each reporting period with the change in fair value recognized in earnings. During 2014, the fair value of the contingent consideration related to the Equator acquisition was reduced by $37.9 million with a corresponding increase in earnings based on management’s revised estimates that expected earnings of Equator would be lower than projected at the time of acquisition. The reduction in fair value was recorded in 2014 and is reflected as a reduction of selling, general and administrative expenses in the consolidated statements of operations (see Note 19). See Note 10 for additional information on the impairment of Technology Services goodwill for the years ended December 31, 2015 and 2014, which includes Equator goodwill. ResCap Fee-Based Businesses On April 12, 2013, we entered into an agreement with Ocwen to establish additional terms related to the existing servicing arrangements between Altisource and Ocwen in connection with certain mortgage servicing platform assets of ResCap (the “ResCap Business”). The agreement provides that (i) Altisource will be a provider to Ocwen of certain services related to the ResCap Business, (ii) Ocwen will not establish similar fee-based businesses that would directly or indirectly compete with Altisource’s services as they relate to the ResCap Business and (iii) Ocwen will market and promote the utilization of Altisource’s services to their various third party relationships. Additionally, the parties agreed to use commercially reasonable best efforts to ensure that the loans associated with the ResCap Business are boarded onto Altisource’s mortgage servicing platform. We paid $128.8 million to Ocwen in connection with the ResCap fee-based businesses agreement. We acquired no tangible assets and assumed no liabilities in connection with the ResCap transaction. However, certain employees as well as practices and processes developed to support the ResCap servicing portfolio were components of the transaction. We accounted for this transaction as a business combination in accordance with ASC Topic 805, Business Combinations . Management prepared a final purchase price allocation and assigned associated asset lives based upon available information at the time of the agreement and until finalized as of December 31, 2013. The agreement consideration of $128.8 million was fully allocated to the customer relationship intangible asset with an estimated average useful life of 7 years . See Note 10 for additional information on the impairment of a portion of the ResCap customer relationship intangible asset for the year ended December 31, 2015. Homeward Fee-Based Businesses On March 29, 2013, we acquired certain fee-based businesses associated with Ocwen’s acquisition of Homeward. As part of the acquisition, Ocwen agreed not to develop similar fee-based businesses that would directly or indirectly compete with services provided by Altisource to Ocwen with respect to the Homeward servicing portfolio. Additionally, the terms of our Service Agreements with Ocwen were amended to extend the term from 2020 to 2025 (see Note 3). We paid $75.8 million , after a working capital and pre-acquisition net income adjustment payment by Ocwen of $11.1 million , which we received in September 2013. Since the acquisition date, management adjusted the purchase price allocation and assigned associated asset lives based upon information that has become available. In addition to the working capital adjustment, we also reduced premises and equipment by $1.2 million based on a post-acquisition detailed analysis of software licenses received and increased current liabilities by $2.0 million based on a subsequent detailed analysis of obligations payable as of the closing date, which we paid in 2014. Consequently, the Company disclosed the corresponding amount of non-cash investing and financing activities in the consolidated statement of cash flows for the year ended December 31, 2013. The final adjusted allocation of the purchase price is as follows: (in thousands) Premises and equipment $ 1,559 Customer relationship 75,609 Goodwill 2,039 79,207 Accounts payable and accrued expenses (3,390 ) Purchase price $ 75,817 Estimated life (in years) Premises and equipment 3 - 5 Customer relationships 7 See Note 10 for additional information on the impairment of a portion of the Homeward customer relationship intangible asset for the year ended December 31, 2015. The following table presents the unaudited pro forma consolidated results of operations for the year ended December 31, 2013 as if the Equator, ResCap and Homeward transactions had occurred at the beginning of the period presented. Year ended December 31, 2013 (in thousands, except per share amounts) As reported Pro forma Revenue $ 768,357 $ 854,098 Net income attributable to Altisource 129,973 132,907 Earnings per share — diluted 5.19 5.31 The unaudited pro forma information presents the combined operating results of Altisource and the Homeward fee-based business, ResCap fee-based business and Equator. The Homeward fee-based business, ResCap fee-based business and Equator operating results were derived from their historical financial statements for the most comparable periods available. The results prior to the acquisition dates have been adjusted to include the pro forma impact of the adjustment of amortization of the acquired intangible assets based on the purchase price allocations, the adjustment of interest expense reflecting the portion of our senior secured term loan used in the Homeward fee-based business, ResCap fee-based business and Equator transactions and to reflect the impact of income taxes on the pro forma adjustments utilizing Altisource’s effective income tax rate. The unaudited pro forma results are presented for illustrative purposes only and do not reflect additional revenue opportunities, the realization of any potential cost savings and any related integration costs. Certain revenue opportunities and cost savings may result from the transactions and the conversion to the Altisource model; however, there can be no assurance that these revenue opportunities and cost savings will be achieved. These pro forma results do not purport to be indicative of the results that would have actually been obtained if the transactions occurred as of the beginning of the period presented, nor is the pro forma data intended to be a projection of results that may be obtained in the future. |
FAIR VALUE
FAIR VALUE | 12 Months Ended |
Dec. 31, 2015 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE | FAIR VALUE Fair Value Measurements on a Recurring Basis In accordance with ASC Topic 805, Business Combinations , liabilities for contingent consideration are reflected at fair value and adjusted each reporting period with the change in fair value recognized in earnings. Liabilities for acquisition related contingent consideration were recorded in connection with the acquisitions of Equator in 2013 and Mortgage Builder and Owners in 2014. The fair value of the liabilities for acquisition related contingent consideration were $3.9 million and $11.6 million as of December 31, 2015 and 2014 , respectively. We measure the liabilities for acquisition related contingent consideration using Level 3 inputs as they are determined based on the present value of future estimated payments, which include sensitivities pertaining to discount rates and financial projections. There were no transfers between different levels during the periods presented. During 2015 , we reached an agreement with the former owners of Equator to extinguish any liability for the Equator Earn Out in exchange for $0.5 million . In connection with this settlement, we reduced the liability for the Equator Earn Out to $0 and recognized a $7.6 million increase in earnings. In 2014, the Company recorded a change in the fair value of the Equator Earn Out of $37.9 million (see Note 5). These transactions are reflected as a reduction in selling, general and administrative expenses in the consolidated statements of operations (see Note 19). Fair Value Measurements on a Nonrecurring Basis The Company recorded goodwill impairment losses of $55.7 million and $37.5 million for the years ended December 31, 2015 and 2014 , respectively, based on fair value measurements. In addition, the Company recorded an intangible asset impairment losses of $11.9 million and a premises and equipment impairment loss of $4.1 million for the year ended December 31, 2015 , based on fair value measurements. These fair value measurements were based on inputs classified as Level 3 in the valuation hierarchy (see Notes 9 and 10). Fair Value of Financial Instruments The following table presents the carrying amount and estimated fair value of financial instruments held by the Company at December 31, 2015 and 2014 that are not carried at fair value. The fair values are estimated using market information and what the Company believes to be appropriate valuation methodologies under GAAP: December 31, 2015 December 31, 2014 (in thousands) Carrying Amount Fair Value Carrying Amount Fair Value Level 1 Level 2 Level 3 Level 1 Level 2 Level 3 Cash and cash equivalents $ 179,327 $ 179,327 $ — $ — $ 161,361 $ 161,361 $ — $ — Restricted cash 4,801 4,801 — — 3,022 3,022 — — Long-term debt 536,598 — 469,523 — 591,543 — 467,319 — Our financial assets and financial liabilities primarily include cash and cash equivalents, restricted cash and long-term debt. Cash and cash equivalents and restricted cash are carried at amounts that approximate their fair value due to the short-term nature of these instruments and were measured using Level 1 inputs. The fair value of our long-term debt is based on quoted market prices. Based on the frequency of trading, we do not believe that there is an active market for our debt. Therefore, the quoted prices are considered Level 2 inputs. |
ACCOUNTS RECEIVABLE, NET
ACCOUNTS RECEIVABLE, NET | 12 Months Ended |
Dec. 31, 2015 | |
Receivables [Abstract] | |
ACCOUNTS RECEIVABLE, NET | ACCOUNTS RECEIVABLE, NET Accounts receivable, net consists of the following as of December 31: (in thousands) 2015 2014 Billed $ 67,021 $ 73,532 Unbilled 56,458 61,326 123,479 134,858 Less: allowance for doubtful accounts (18,456 ) (22,675 ) Total $ 105,023 $ 112,183 Unbilled receivables consist primarily of certain asset management and default management services for which we generally recognize revenues over the service delivery period but bill following completion of the service. We also include in unbilled receivables amounts that are earned during a month and billed in the following month. Bad debt expense amounted to $5.5 million , $16.3 million and $2.5 million for the years ended December 31, 2015 , 2014 and 2013 , respectively, and is included in selling, general and administrative expenses in the consolidated statements of operations. Bad debt expense increased during 2014 primarily driven by the default management services business. A change in many of our default management services customers’ business models and fourth quarter 2014 discussions with those customers led us to believe that a portion of the accounts receivable balance was no longer collectible. |
PREPAID EXPENSES AND OTHER CURR
PREPAID EXPENSES AND OTHER CURRENT ASSETS | 12 Months Ended |
Dec. 31, 2015 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
PREPAID EXPENSES AND OTHER CURRENT ASSETS | PREPAID EXPENSES AND OTHER CURRENT ASSETS Prepaid expenses and other current assets consist of the following as of December 31: (in thousands) 2015 2014 Maintenance agreements, current portion $ 7,000 $ 6,367 Income taxes receivable 633 5,258 Prepaid expenses 7,873 6,989 Other current assets 6,245 4,953 Total $ 21,751 $ 23,567 |
PREMISES AND EQUIPMENT, NET
PREMISES AND EQUIPMENT, NET | 12 Months Ended |
Dec. 31, 2015 | |
Property, Plant and Equipment [Abstract] | |
PREMISES AND EQUIPMENT, NET | PREMISES AND EQUIPMENT, NET Premises and equipment, net consists of the following as of December 31: (in thousands) 2015 2014 Computer hardware and software $ 177,010 $ 140,799 Office equipment and other 21,720 36,032 Furniture and fixtures 14,443 12,231 Leasehold improvements 35,503 34,069 248,676 223,131 Less: accumulated depreciation and amortization (129,555 ) (95,372 ) Total $ 119,121 $ 127,759 Depreciation and amortization expense amounted to $36.5 million , $29.0 million and $19.1 million for the years ended December 31, 2015 , 2014 and 2013 , respectively, and is included in cost of revenue for operating assets and in selling, general and administrative expenses for non-operating assets in the consolidated statements of operations. In the fourth quarter of 2015, we recognized a $4.1 million premises and equipment impairment loss in our Technology Services segment primarily driven by the Company’s current projected Technology Services revenue from Ocwen and investment in technologies provided to Ocwen. There were no impairments of premises and equipment for the years ended December 31, 2014 and 2013. |
GOODWILL AND INTANGIBLE ASSETS,
GOODWILL AND INTANGIBLE ASSETS, NET | 12 Months Ended |
Dec. 31, 2015 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
GOODWILL AND INTANGIBLE ASSETS, NET | GOODWILL AND INTANGIBLE ASSETS, NET Goodwill Goodwill was recorded primarily in connection with the 2015 acquisitions of CastleLine and the Acquired RentRange and Investability Businesses, the 2014 acquisitions of Mortgage Builder and Owners, the 2013 acquisitions of Homeward and Equator, the 2011 acquisitions of Springhouse, LLC and Tracmail and the 2010 acquisition of MPA. Note 5 discusses 2015, 2014 and 2013 acquisitions. Changes in goodwill during the years ended December 31, 2015 and 2014 are summarized below: (in thousands) Mortgage Services Financial Services Technology Services Total Balance January 1, 2014 $ 12,958 $ 2,378 $ 84,078 $ 99,414 Acquisition of Mortgage Builder — — 9,135 9,135 Acquisition of Owners 19,775 — — 19,775 Impairment of Equator goodwill — — (37,473 ) (37,473 ) Balance, December 31, 2014 32,733 2,378 55,740 90,851 Acquisition of CastleLine 28,125 — — 28,125 Acquisition of Acquired RentRange and Investability Businesses 19,565 — — 19,565 Impairment of Technology Services goodwill — — (55,740 ) (55,740 ) Balance, December 31, 2015 $ 80,423 $ 2,378 $ — $ 82,801 In the second quarter of 2014, management determined that Equator goodwill should be tested for impairment as a result of the decline in fair value of the Equator Earn Out (see Note 15). Consequently, we initiated a quantitative two-step goodwill impairment test by comparing the carrying value of the net assets of Equator to its fair value based on a discounted cash flow analysis. Based on this goodwill assessment, we determined that the fair value of Equator was less than its carrying value and goodwill was impaired. As a result, we recorded an impairment loss of $37.5 million . During our fourth quarter 2014 and 2015 annual goodwill assessments, we elected to bypass the initial analysis of qualitative factors and perform a quantitative two-step goodwill impairment test of all of our reporting units as a result of the goodwill impairment recorded in the second quarter of 2014. We calculated the fair value of each of our reporting units by using a discounted cash flow analysis and concluded that the fair values of the Mortgage Services, Financial Services and Technology Services reporting units exceeded their carrying values by a significant margin in 2014 and that the fair values of the Mortgage Services and Financial Services reporting units exceeded their carrying values by a significant margin in 2015. In 2015, the fair value of the Technology Services reporting unit was less than its carrying value. Accordingly, we performed step two of the impairment test for the Technology Services reporting unit and determined that the remaining $55.7 million of goodwill was impaired. As a result, we recorded an estimated $55.7 million impairment loss in the fourth quarter of 2015. This goodwill impairment was primarily driven by the Company’s current projected Technology Services revenue from Ocwen and investment in technologies provided to Ocwen. There were no additional goodwill impairments as of December 31, 2015 and 2014, and there was no goodwill impairment in 2013. Intangible Assets, Net Intangible assets, net consist of the following as of December 31: Weighted useful life (in years) Gross carrying amount Accumulated amortization Net book value (in thousands) 2015 2014 2015 2014 2015 2014 Definite lived intangible assets: Trademarks and trade names 13 $ 15,244 $ 13,889 $ (6,491 ) $ (5,016 ) $ 8,753 $ 8,873 Customer related intangible assets 10 274,428 289,308 (113,725 ) (79,606 ) 160,703 209,702 Operating agreement 20 35,000 35,000 (10,354 ) (8,604 ) 24,646 26,396 Non-compete agreements 4 1,435 — (115 ) — 1,320 — Intellectual property 10 300 300 (55 ) (25 ) 245 275 Other intangible assets 5 1,375 — (39 ) — 1,336 — Total $ 327,782 $ 338,497 $ (130,779 ) $ (93,251 ) $ 197,003 $ 245,246 Amortization expense for definite lived intangible assets was $41.1 million , $37.7 million and $28.2 million for the years ended December 31, 2015 , 2014 and 2013 , respectively . Expected annual definite lived intangible asset amortization expense for 2016 through 2020 is $32.3 million , $26.7 million , $23.6 million , $21.4 million and $19.5 million , respectively. In the fourth quarter of 2015, we recorded an impairment loss of $11.9 million in our Technology Services segment related to customer relationship intangible assets from the 2013 Homeward and ResCap fee-based business acquisitions. These impairments of intangible assets were primarily driven by the Company’s current projected Technology Services revenue from Ocwen and investment in technologies provided to Ocwen. There were no impairments of intangible assets for the years ended December 31, 2014 and 2013. |
INVESTMENT IN EQUITY AFFILIATE
INVESTMENT IN EQUITY AFFILIATE | 12 Months Ended |
Dec. 31, 2015 | |
Equity Method Investments and Joint Ventures [Abstract] | |
INVESTMENT IN EQUITY AFFILIATE | INVESTMENT IN EQUITY AFFILIATE Correspondent One purchased closed conforming residential mortgages from approved mortgage bankers. Prior to the sale of our interest in Correspondent One to Ocwen on March 31, 2013 (see Note 4 ), we had significant influence over the general operations of Correspondent One consistent with our 49% ownership level, and therefore, accounted for our investment under the equity method. On March 31, 2013, we sold our 49% interest in Correspondent One to Ocwen for $12.6 million . Our net loss on this investment using the equity method was $0.2 million for the year ended December 31, 2013 ( no comparative amounts for 2015 and 2014 ). |
OTHER ASSETS
OTHER ASSETS | 12 Months Ended |
Dec. 31, 2015 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
OTHER ASSETS | OTHER ASSETS Other assets consist of the following as of December 31: (in thousands) 2015 2014 Security deposits, net $ 5,341 $ 7,277 Debt issuance costs, net 6,184 8,099 Maintenance agreements, non-current portion 1,570 3,324 Restricted cash 4,801 3,022 Other 1,441 545 Total $ 19,337 $ 22,267 |
ACCOUNTS PAYABLE, ACCRUED EXPEN
ACCOUNTS PAYABLE, ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES | 12 Months Ended |
Dec. 31, 2015 | |
Payables and Accruals [Abstract] | |
ACCOUNTS PAYABLE, ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES | ACCOUNTS PAYABLE, ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES Accounts payable and accrued expenses consist of the following as of December 31: (in thousands) 2015 2014 Accounts payable $ 11,644 $ 28,280 Accrued expenses - general 30,347 31,693 Accrued salaries and benefits 46,564 44,150 Income taxes payable 3,316 7,643 Total $ 91,871 $ 111,766 Other current liabilities consist of the following as of December 31: (in thousands) 2015 2014 Unfunded cash account balances $ 6,395 $ 4,788 Other 9,871 8,439 Total $ 16,266 $ 13,227 |
LONG-TERM DEBT
LONG-TERM DEBT | 12 Months Ended |
Dec. 31, 2015 | |
Debt Disclosure [Abstract] | |
LONG-TERM DEBT | LONG-TERM DEBT Long-term debt consists of the following as of December 31: (in thousands) 2015 2014 Senior secured term loan $ 536,598 $ 591,543 Less: unamortized discount, net (2,236 ) (2,929 ) Net long-term debt 534,362 588,614 Less: current portion (5,945 ) (5,945 ) Long-term debt, less current portion $ 528,417 $ 582,669 On November 27, 2012, Altisource Solutions S.à r.l., a wholly-owned subsidiary of Altisource Portfolio Solutions S.A., entered into a senior secured term loan agreement with Bank of America, N.A., as administrative agent, and certain lenders. Altisource Portfolio Solutions S.A. and certain wholly-owned subsidiaries are guarantors of the term loan (collectively, the “Guarantors”). We subsequently amended the senior secured term loan agreement to increase the principal amount of the senior secured term loan and, among other changes, re-establish the $200.0 million incremental term loan facility accordion, lower the interest rate, extend the maturity date by approximately one year and increase the maximum amount of Restricted Junior Payments (as defined in the senior secured term loan agreement; other capitalized terms, unless defined herein, are defined in the senior secured term loan agreement). After giving effect to the third amendment entered into on August 1, 2014, the term loan must be repaid in equal consecutive quarterly principal installments of $1.5 million , which commenced on September 30, 2014, with the balance due at maturity. All amounts outstanding under the senior secured term loan agreement will become due on the earlier of (i) December 9, 2020, and (ii) the date on which the loans are declared to be due and owing by the administrative agent at the request (or with the consent) of the Required Lenders or as otherwise provided in the loan agreement upon the occurrence of any event of default under the senior secured term loan agreement. In addition to the scheduled principal payments, subject to certain exceptions, the term loan is subject to mandatory prepayment upon issuances of debt, casualty and condemnation events and sales of assets, as well as from a percentage of Consolidated Excess Cash Flow if the leverage ratio is greater than 3.00 to 1.00 , as calculated in accordance with the provisions of the senior secured term loan (the percentage increases if the leverage ratio exceeds 3.50 to 1.00). No mandatory prepayments were owed for the year ended December 31, 2015 . During 2015 , we repurchased portions of our senior secured term loan with an aggregate par value of $49.0 million at a weighted average discount of 10.3% , resulting in net gains totaling $3.8 million on the early extinguishment of debt. These net gains are included in other income (expense), net in the consolidated statements of operations (see Note 21). The term loan bears interest at rates based upon, at our option, the Adjusted Eurodollar Rate or the Base Rate . Adjusted Eurodollar Rate loans bear interest at a rate per annum equal to the sum of (i) the greater of (x) the Adjusted Eurodollar Rate for the applicable interest period and (y) 1.00% plus (ii) a 3.50% margin. Base Rate loans bear interest at a rate per annum equal to the sum of (i) the greater of (x) the Base Rate and (y) 2.00% plus (ii) a 2.50% margin. The interest rate at December 31, 2015 was 4.50% . Term loan payments are guaranteed by the Guarantors and are secured by a pledge of all equity interests of certain subsidiaries as well as a lien on substantially all of the assets of Altisource Solutions S.à r.l. and the Guarantors, subject to certain exceptions. The senior secured term loan agreement includes covenants that restrict or limit, among other things, our ability to: create liens and encumbrances; incur additional indebtedness; sell, transfer or dispose of assets; make Restricted Junior Payments including share repurchases, dividends and repayment of junior indebtedness; change lines of business; amend material debt agreements or other material contracts; engage in certain transactions with affiliates; enter into sale/leaseback transactions; grant negative pledges or agree to such other restrictions relating to subsidiary dividends and distributions; make changes to our fiscal year and engage in mergers and consolidations. The senior secured term loan agreement contains certain events of default, including (i) failure to pay principal when due or interest or any other amount owing on any other obligation under the senior secured term loan agreement within five days of becoming due, (ii) material incorrectness of representations and warranties when made, (iii) breach of covenants, (iv) failure to pay principal or interest on any other debt that equals or exceeds $40.0 million when due, (v) default on any other debt that equals or exceeds $40.0 million that causes, or gives the holder or holders of such debt the ability to cause, an acceleration of such debt, (vi) occurrence of a Change of Control, (vii) bankruptcy and insolvency events, (viii) entry by a court of one or more judgments against us in an amount in excess of $40.0 million that remain unbonded, undischarged or unstayed for a certain number of days after the entry thereof, (ix) the occurrence of certain ERISA events and (x) the failure of certain Loan Documents to be in full force and effect. If any event of default occurs and is not cured within applicable grace periods set forth in the senior secured term loan agreement or waived, all loans and other obligations could become due and immediately payable and the facility could be terminated. At December 31, 2015 , debt issuance costs were $6.2 million , net of $4.1 million of accumulated amortization. At December 31, 2014 , debt issuance costs were $8.1 million , net of $2.2 million of accumulated amortization. Debt issuance costs are included in other assets in the accompanying consolidated balance sheets. Interest expense on the term loans, including amortization of debt issuance costs and the net debt discount, totaled $28.2 million , $23.4 million and $20.3 million for the years ended December 31, 2015 , 2014 and 2013 , respectively. Maturities of our long-term debt are as follows: (in thousands) 2016 $ 5,945 2017 5,945 2018 5,945 2019 5,945 2020 512,818 $ 536,598 |
OTHER NON-CURRENT LIABILITIES
OTHER NON-CURRENT LIABILITIES | 12 Months Ended |
Dec. 31, 2015 | |
Other Liabilities Disclosure [Abstract] | |
OTHER NON-CURRENT LIABILITIES | OTHER NON-CURRENT LIABILITIES Other non-current liabilities consist of the following as of December 31: (in thousands) 2015 2014 Acquisition related contingent consideration $ 3,932 $ 11,616 Other non-current liabilities 14,221 9,032 Total $ 18,153 $ 20,648 We recognized gains on the change in the fair value of Equator earn out liability of $7.6 million and $37.9 million for the years ended December 31, 2015 and 2014 , respectively ( no comparative amount in 2013). The liability for contingent consideration is reflected at fair value and adjusted each reporting period with the change in fair value recognized in earnings. In 2015 , we reached an agreement with the former owners of Equator to extinguish any liability for the Equator Earn Out. In connection with this settlement, we reduced the liability for the Equator Earn Out to $0 and recognized a $7.6 million increase in earnings. During 2014 , the fair value of the contingent consideration related to the Equator acquisition was reduced by $37.9 million with a corresponding increase in earnings based on management’s revised estimates that expected earnings of Equator will be lower than projected at the time of acquisition. |
SHAREHOLDERS' EQUITY AND SHARE-
SHAREHOLDERS' EQUITY AND SHARE-BASED COMPENSATION | 12 Months Ended |
Dec. 31, 2015 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
SHAREHOLDERS' EQUITY AND SHARE-BASED COMPENSATION | SHAREHOLDERS’ EQUITY AND SHARE-BASED COMPENSATION Common Stock At December 31, 2015 , we had 25.4 million shares authorized and issued, and 19.0 million shares of common stock outstanding. At December 31, 2014 , we had 25.4 million shares authorized and issued, and 20.3 million shares of common stock outstanding. The holders of shares of Altisource common stock generally are entitled to one vote for each share on all matters voted on by shareholders, and the holders of such shares generally will possess all voting power. On October 9, 2015, we acquired the Acquired RentRange and Investability Businesses for $24.8 million , which included a cash component and the issuance of 247 thousand shares of restricted common stock of the Company with a value of $7.3 million as of the closing date. The restricted stock is subject to transfer restrictions and potential forfeiture provisions. These restrictions and forfeiture provisions will be removed over a four year period, subject to meeting certain continued employment conditions with the Company and meeting certain acquisition related escrow release conditions. In addition, on July 17, 2015, we acquired CastleLine for $33.4 million , which included a cash component and the issuance of 495 thousand shares of restricted common stock of the Company with a value of $14.4 million as of the closing date. The restrictions related to the common stock issued in connections with the CastleLine acquisition were removed on January 20, 2016. See Note 5 for additional information about these acquisitions. Equity Incentive Plan Our 2009 Equity Incentive Plan (the “Plan”) provides for various types of equity awards, including stock options, stock appreciation rights, stock purchase rights, restricted shares and other awards, or a combination of any of the above. Under the Plan, we may grant up to 6.7 million Altisource share-based awards to officers, directors, key employees and to employees of our affiliates. As of December 31, 2015 , 1.6 million share-based awards were available for future grant under the Plan. Expired and forfeited awards are available for reissuance. Vesting and exercise of share-based awards are generally contingent on continued employment. Share Repurchase Plan On May 20, 2015 , our shareholders approved a new share repurchase program, which replaced the previous share repurchase program. Under the new program, we are authorized to purchase up to 3.0 million shares of our common stock, based on a limit of 15% of the outstanding shares of common stock on the date of approval at a minimum price of $1.00 per share and a maximum price of $500.00 per share. This is in addition to amounts previously purchased under prior programs. Under the existing and prior programs, we purchased 2.1 million shares of common stock at an average price of $27.60 per share during the year ended December 31, 2015 , 2.5 million shares at an average price of $103.67 per share during the year ended December 31, 2014 and 1.2 million shares at an average price of $116.99 per share during the year ended December 31, 2013. As of December 31, 2015 , approximately 1.4 million shares of common stock remain available for repurchase under the new program. Our senior secured term loan limits the amount we can spend on share repurchases and may prevent repurchases in certain circumstances. As of December 31, 2015 , approximately $360 million was available to repurchase shares of our common stock under our senior secured term loan. Share-Based Compensation We issue share-based awards in the form of stock options and certain other equity-based awards for certain employees and officers. We recorded share-based compensation expense of $4.8 million , $2.2 million and $2.4 million for the years ended December 31, 2015 , 2014 and 2013 , respectively. As of December 31, 2015 , estimated unrecognized compensation costs related to share-based awards amounted to $11.4 million , which we expect to recognize over a weighted average remaining requisite service period of approximately 2.65 years . Stock Options Stock option grants are composed primarily of a combination of service-based and market-based options. Service-Based Options. These options generally vest over three years or four years with equal annual cliff-vesting and expire on the earlier of ten years after the date of grant or following termination of service. A total of 1.2 million service-based awards were outstanding at December 31, 2015 . Market-Based Options . These option grants generally have two components, each of which vests only upon the achievement of certain criteria. The first component, which we refer to internally as “ordinary performance” grants, consists of two-thirds of the market-based grant and begins to vest if the stock price is at least double the exercise price, as long as the stock price realizes a compounded annual gain of at least 20% over the exercise price. The remaining third of the market-based options, which we refer to internally as “extraordinary performance” grants, begins to vest if the stock price is at least triple the exercise price, as long as the stock price realizes a compounded annual gain of at least 25% over the exercise price. The vesting schedule for substantially all market-based awards is 25% upon achievement of the criteria and thereafter the remaining 75% in three equal annual installments. Market-based options generally expire on the earlier of ten years after the date of grant or following termination of service, unless the performance criteria is met prior to termination of service or in the final three years of the option term, in which case vesting will continue in accordance with the provisions of the award agreement. A total of 2.0 million market-based awards were outstanding at December 31, 2015 . The Company granted 0.9 million stock options (at a weighted average exercise price of $24.21 per share), 0.1 million stock options (at a weighted average exercise price $84.61 per share) and less than 0.1 million stock options (at a weighted average exercise price of $104.84 per share) during the years ended December 31, 2015 , 2014 and 2013 , respectively. The fair value of the service-based options was determined using the Black-Scholes option pricing model and the fair value of the market-based options was determined using a lattice (binomial) model. The following assumptions were used to determine the fair value as of the grant date: 2015 2014 2013 Black-Scholes Binomial Black-Scholes Binomial Black-Scholes Binomial Risk-free interest rate (%) 1.50 – 1.91 0.02 – 2.34 1.80 – 1.91 0.01 – 2.49 1.02 – 1.81 0.01 – 2.71 Expected stock price volatility (%) 55.06 – 59.73 55.06 – 59.73 37.57 – 45.15 38.38 – 45.15 36.35 – 36.76 36.40 – 36.80 Expected dividend yield — — — — — — Expected option life (in years) 6.00 – 6.25 4.08 – 4.92 6.25 4.36 – 5.83 6.25 4.20 – 6.50 Fair value $10.01 – $17.66 $9.91 – $18.05 $15.54 – $41.79 $12.66 – $33.62 $31.33 – $49.14 $16.12 – $41.72 We determined the expected option life of all service-based stock option grants using the simplified method. We use the simplified method because we believe that our historical data does not provide a reasonable basis upon which to estimate expected option life. The following table summarizes the weighted average grant date fair value of stock options granted per share, the total intrinsic value of stock options exercised and the grant date fair value of stock options vested during the years ended December 31: (in thousands, except per share amounts) 2015 2014 2013 Weighted average grant date fair value of stock options granted per share $ 13.20 $ 26.92 $ 32.59 Intrinsic value of stock options exercised 1,998 10,250 40,761 Grant date fair value of stock options that vested during the period 1,616 2,641 3,156 The following table summarizes the activity related to our stock options: Number of options Weighted average exercise price Weighted average contractual term (in years ) Aggregate intrinsic value ( in thousands) Outstanding at December 31, 2014 2,601,892 $ 21.21 4.44 $ 47,805 Granted 853,510 24.21 Exercised (130,682 ) 10.64 Forfeited (161,595 ) 66.72 Outstanding at December 31, 2015 3,163,125 20.13 4.94 35,842 Exercisable at December 31, 2015 2,214,051 14.43 3.12 32,395 The following table summarizes information about stock options outstanding and exercisable at December 31, 2015 : Options outstanding Options exercisable Exercise price range Number Weighted average remaining contractual life (in years ) Weighted average exercise price Number Weighted average remaining contractual life (in years ) Weighted average exercise price Up to $10.00 (a) 1,575,003 2.54 $ 9.14 1,575,003 2.54 $ 9.14 $10.01 — $20.00 (a) 427,781 8.44 18.23 64,729 3.66 15.08 $20.01 — $30.00 (a) 881,711 6.73 25.68 470,311 4.32 23.21 $30.01 — $40.00 (a) 63,880 7.02 32.26 39,880 5.43 33.05 $40.01 — $50.00 (a) 5,000 8.94 49.06 313 8.94 49.06 $60.01 — $70.00 (a) 71,000 6.19 60.73 46,469 6.19 60.74 $70.01 — $80.00 (a) 25,000 8.87 72.78 1,563 8.87 72.78 $80.01 — $90.00 (a) 40,000 8.04 85.63 9,063 7.37 84.35 $90.01 — $100.00 (a) 71,875 8.33 94.31 6,251 8.01 94.26 $100.01 — $110.00 (a) 1,875 8.37 105.11 469 8.37 105.11 3,163,125 2,214,051 (a) These options contain market-based components as described above. The following table summarizes the market prices necessary in order for the market performance options to begin to vest: Market-based options Vesting price Ordinary performance Extraordinary performance $170.01 — $180.00 12,500 — $180.01 — $190.00 12,500 25,875 Over $190.00 22,500 30,000 Total 47,500 55,875 Weighted average share price $ 92.29 $ 77.03 Other Share-Based Awards The Company’s other share-based and similar types of awards are composed of restricted shares and Equity Appreciation Rights (“EARs”). The restricted shares are service-based awards that vest over one to four years with either annual cliff vesting, vesting of all of the restricted shares at the end of the vesting period or vesting beginning after two years of service. The Company granted 0.3 million restricted shares (at a weighted average price of $19.25 per share) during the year ended December 31, 2015 . A total of 0.3 million restricted shares were outstanding at December 31, 2015 . The following table summarizes the activity related to our restricted shares: Number of Outstanding at December 31, 2014 26,224 Granted 251,938 Issued (2,836 ) Forfeited (3,000 ) Outstanding at December 31, 2015 272,326 EARs provide participating employees of certain divisions of the Company with the potential to receive a percentage of the increase in the value of the applicable division during the term of the EARs. The Company has established EAR plans for three divisions: Consumer Analytics, Document Solutions and Marketplace Solutions. These EAR plans allow for the issuance of EARs representing up to 15% of each of these divisions. The EARs consist of service-based awards and performance-based awards. Service-based EARs generally vest in equal installments on the first, second, third and fourth anniversaries of the grant date. Performance-based EARs generally begin to vest on the date certain performance criteria are achieved by the applicable division of the Company. The participating employee will have the opportunity at certain times specified in the award agreement to exercise EARs that have vested and in exchange will receive share equivalency units, the number of which will be based on the increase in value of the division and the amount of EARs awarded to the participating employee. After a holding period of six months and one day, the Company, the applicable division or an affiliate of the Company may redeem the share equivalency units for a payment equal to the then fair market value of the share equivalency units. At the Company’s option, the share equivalency units may be redeemed for cash, shares of Altisource’s common stock under its shareholder approved equity incentive plan, a subordinated note payable or, under certain circumstances where the division has been converted into a company form, shares of that company. Upon the occurrence of certain corporate transactions, including the sale of the division, a qualified initial public offering of the equity of the division or a spin-off of the division, the Company will have the right to repurchase and cancel any outstanding share equivalency units or shares of the division that have been issued in payment of redeemed share equivalency units, and the applicable plan administrator will have the discretion to adjust the terms of the applicable division EAR plan and any outstanding EARs. The Company granted EARs with a total grant date fair value of $1.1 million during the year ended December 31, 2015 related to the Company’s Consumer Analytics, Document Solutions and Marketplace Solutions divisions. Generally, 25% of these EARs are service-based and 75% of these EARs are performance-based. The following table summarizes the activity related to our EARs (expressed as a percentage of each of the divisions): Consumer Analytics Document Solutions Marketplace Solutions Outstanding at December 31, 2014 — — — Granted 5.6 % 5.8 % 5.3 % Forfeited — (0.2 ) — Outstanding at December 31, 2015 5.6 % 5.6 % 5.3 % The Company intends to issue additional EARs to employees. Share-based compensation expense for stock options, restricted shares and EARs is recorded net of estimated forfeiture rates ranging from 0% to 40% . |
REVENUE REVENUE
REVENUE REVENUE | 12 Months Ended |
Dec. 31, 2015 | |
Revenues [Abstract] | |
Revenue | REVENUE Revenue includes service revenue, reimbursable expenses and non-controlling interests. Service revenue consists of amounts attributable to our fee-based services. Reimbursable expenses and non-controlling interests are pass-through items for which we earn no margin. Reimbursable expenses consist of amounts we incur on behalf of our customers in performing our fee-based services, but we pass such costs directly on to our customers without any additional markup. Non-controlling interests represent the earnings of Lenders One, Wholesale One and Residential Investor One, consolidated entities not owned by Altisource, and are included in revenue and reduced from net income to arrive at net income attributable to Altisource (see Note 2). The components of revenue were as follows for the years ended December 31: (in thousands) 2015 2014 2013 Service revenue $ 940,920 $ 938,679 $ 662,059 Reimbursable expenses 107,344 137,634 102,478 Non-controlling interests 3,202 2,603 3,820 Total $ 1,051,466 $ 1,078,916 $ 768,357 |
COST OF REVENUE
COST OF REVENUE | 12 Months Ended |
Dec. 31, 2015 | |
Cost of Revenue [Abstract] | |
COST OF REVENUE | COST OF REVENUE Cost of revenue principally includes payroll and employee benefits associated with personnel employed in customer service and operations roles, fees paid to external providers related to the provision of services, reimbursable expenses, technology and telecommunications costs as well as depreciation and amortization of operating assets. The components of cost of revenue were as follows for the years ended December 31: (in thousands) 2015 2014 2013 Compensation and benefits $ 261,839 $ 255,889 $ 156,812 Outside fees and services 248,278 243,325 193,233 Reimbursable expenses 107,344 137,634 102,478 Technology and telecommunications 43,177 48,834 25,534 Depreciation and amortization 26,689 21,498 14,423 Total $ 687,327 $ 707,180 $ 492,480 |
SELLING, GENERAL AND ADMINISTRA
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES | 12 Months Ended |
Dec. 31, 2015 | |
Selling, General and Administrative Expense [Abstract] | |
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES | SELLING, GENERAL AND ADMINISTRATIVE EXPENSES Selling, general and administrative expenses include payroll and employee benefits associated with personnel employed in executive, finance, law, compliance, human resources, vendor management, risk, sales and marketing roles. This category also includes occupancy costs, professional fees, marketing costs, depreciation and amortization of non-operating assets and other expenses. The components of selling, general and administrative expenses were as follows for the years ended December 31: (in thousands) 2015 2014 2013 Compensation and benefits $ 54,897 $ 45,098 $ 27,864 Professional services 23,183 18,598 8,022 Occupancy related costs 39,917 38,262 28,424 Amortization of intangible assets 41,135 37,680 28,176 Depreciation and amortization 9,781 7,548 4,633 Marketing costs 27,499 24,130 5,028 Other 24,456 30,417 11,663 Total $ 220,868 $ 201,733 $ 113,810 |
OTHER INCOME (EXPENSE), NET
OTHER INCOME (EXPENSE), NET | 12 Months Ended |
Dec. 31, 2015 | |
Other Income and Expenses [Abstract] | |
OTHER INCOME (EXPENSE), NET | OTHER INCOME (EXPENSE), NET Other income (expense), net consists of the following for the years ended December 31: (in thousands) 2015 2014 2013 Gain on early extinguishment of debt $ 3,836 $ — $ — Loss in equity affiliate, including impairment loss — — (176 ) Interest income 133 103 899 Other, net 76 71 (166 ) Total $ 4,045 $ 174 $ 557 |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Dec. 31, 2015 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | INCOME TAXES The components of income before income taxes and non-controlling interests consist of the following for the years ended December 31: (in thousands) 2015 2014 2013 Domestic - Luxembourg $ 27,884 $ 124,181 $ 122,722 Foreign - U.S. 5,944 9,575 11,125 Foreign - Non-U.S. 19,232 13,509 8,486 Total $ 53,060 $ 147,265 $ 142,333 The income tax provision consists of the following for the years ended December 31: (in thousands) 2015 2014 2013 Current: Domestic - Luxembourg $ 1,787 $ 4,415 $ 2,516 Foreign - U.S. Federal 539 75 6 Foreign - U.S. State 855 476 403 Foreign - Non-U.S. 6,405 4,046 3,600 $ 9,586 $ 9,012 $ 6,525 Deferred: Foreign - U.S. Federal $ (108 ) $ 1,756 $ 2,506 Foreign - U.S. State (526 ) (281 ) 84 Foreign - Non-U.S. (692 ) (309 ) (575 ) $ (1,326 ) $ 1,166 $ 2,015 Total $ 8,260 $ 10,178 $ 8,540 We received a tax ruling in June 2010 regarding the treatment of certain intangibles that exist for purposes of determining the Company’s taxable income, which expires in 2019 unless extended or renewed. This ruling does not have a material impact on our deferred tax assets or liabilities. Income tax computed by applying the Luxembourg statutory income tax rate of 29.2% differs from income tax computed at the effective tax rate primarily because of the effect of the tax ruling and differing tax rates in multiple jurisdictions. We operate under tax holidays in certain geographies in India, the Philippines and Uruguay. The India tax holidays are effective through 2020, and may be extended if certain additional requirements are satisfied. The Philippines tax holiday is effective through 2016, and may also be extended. We operate in a Uruguay free trade zone that provides an indefinite future tax benefit. The tax holidays are conditional upon our meeting certain employment and investment thresholds. The impact of these tax holidays decreased foreign taxes by $0.8 million ( $0.04 per diluted share), $0.9 million ( $0.04 per diluted share) and $0.2 million ( $0.01 per diluted share) for the years ended December 31, 2015 , 2014 and 2013 , respectively. The Company accounts for certain income and expense items differently for financial reporting purposes and income tax purposes. We recognize deferred income tax assets and liabilities for these differences between the financial reporting basis and the tax basis of our assets and liabilities as well as expected benefits of utilizing net operating loss and credit carryforwards. We measure deferred income tax assets and liabilities using enacted tax rates expected to apply to taxable income in the years in which we expect to recover or settle those temporary differences. A summary of the tax effects of the temporary differences is as follows for the years ended December 31: (in thousands) 2015 2014 Current deferred tax assets: Allowance for doubtful accounts and other reserves $ — $ 72 Accrued expenses — 5,165 Current deferred tax liabilities: Prepaid expenses — (250 ) Current deferred tax assets, net $ — $ 4,987 Non-current deferred tax assets: Net operating loss carryforwards $ 5,417 $ 13,940 U.S. federal and state tax credits 2,577 1,202 Non-U.S. deferred tax assets 2,472 1,780 Share-based compensation 1,750 856 Accrued expenses 7,730 — Non-current deferred tax liabilities: Intangible assets (4,508 ) (5,302 ) Depreciation (7,446 ) (11,878 ) Other (815 ) (177 ) 7,177 421 Valuation allowance (3,558 ) (3,115 ) Non-current deferred tax assets, net $ 3,619 $ — Non-current deferred tax liabilities, net $ — $ (2,694 ) Net deferred tax assets $ 3,619 $ 2,293 A valuation allowance is provided when it is deemed more likely than not that some portion or all of a deferred tax asset will not be realized. In determining whether a valuation allowance is needed, we considered estimates of future taxable income, future reversals of temporary differences, the tax character of gains and losses and the impact of tax planning strategies that can be implemented, if warranted. The net increase in valuation allowance of $0.4 million during 2015 relates to an increase in foreign losses generated in the current year that the Company believes will more likely than not be realized. We have not provided Luxembourg deferred taxes on cumulative earnings of non-Luxembourg affiliates as we have chosen to indefinitely reinvest these earnings. The earnings reinvested as of December 31, 2015 were approximately $63.5 million , which if distributed would result in additional tax due totaling approximately $12.5 million . The Company had a deferred tax asset of $5.4 million as of December 31, 2015 relating to the U.S. federal, state and foreign net operating losses compared to $13.9 million as of December 31, 2014 . Of this amount, $1.6 million as of December 31, 2015 related to state net operating losses subject to a valuation allowance compared to $ 1.8 million as of December 31, 2014 , and $2.3 million as of December 31, 2015 related to Luxembourg net operating losses subject to a valuation allowance compared to $1.7 million as of December 31, 2014 . The Company has not recognized the U.S. federal net operating loss carryforwards of $13.6 million as of December 31, 2015 related to stock options exercised compared to $13.6 million as of December 31, 2014 . If realized, the benefit would be an increase to additional paid-in capital. The gross amount of net operating losses available for carryover to future years is approximately $14.8 million as of December 31, 2015 compared to $35.7 million as of December 31, 2014 . Of this amount, $10.1 million as of December 31, 2015 compared to $12.2 million as of December 31, 2014 relates to Nationwide Credit, Inc. (“NCI”) for periods prior to our acquisition of NCI and is subject to Section 382 of the Internal Revenue Code (the “Code”) which limits their use to approximately $1.3 million per year. These losses are scheduled to expire between the years 2022 and 2029. In addition, the Company had a deferred tax asset of $2.6 million and $1.2 million as of December 31, 2015 and 2014 , respectively, relating to the U.S. federal and state tax credits. The U.S. federal credit carryforward is scheduled to expire between 2032 and 2035. The state tax credit carryforwards are scheduled to expire between 2017 and 2025. The distribution of the Company in connection with the separation from Ocwen during 2009 was intended to be a tax-free transaction under Section 355 of the Code. To the extent Ocwen does recognize tax under Section 355 of the Code, Altisource has agreed to indemnify Ocwen. In addition, we have agreed to indemnify Ocwen should the expected tax treatments not be upheld upon review or audit to the extent related to our operating results. The Company does not anticipate a material obligation under this indemnity. The following table reconciles the Luxembourg statutory tax rate to our effective tax rate for the years ended December 31: 2015 2014 2013 Statutory tax rate 29.22 % 29.22 % 29.22 % Permanent difference related to Luxembourg intangible assets (13.56 ) (22.60 ) (23.59 ) Change in valuation allowance 0.83 (0.05 ) 0.76 State tax expense 0.29 0.03 0.24 Tax credits (2.34 ) (0.71 ) — Uncertain taxes 1.39 0.88 — Other (0.26 ) 0.14 (0.63 ) Effective tax rate 15.57 % 6.91 % 6.00 % The Company follows ASC Topic 740 which clarifies the accounting and disclosure for uncertainty in tax positions. We analyzed our tax filing positions in all of the domestic and foreign tax jurisdictions where we are required to file income tax returns as well as for all open tax years in these jurisdictions. The Company has open tax years in the United States (2011 through 2014), India (2010 through 2015) and Luxembourg (2010 through 2013). The following table reconciles the amount of unrecognized tax benefits for the years ended December 31: (in thousands) 2015 2014 Amount of unrecognized tax benefits as of the beginning of the year $ 1,153 $ — Increases as a result of tax positions taken in a prior period 638 1,153 Increases as a result of tax positions taken in the current period 214 — Amount of unrecognized tax benefits as of the end of the year $ 2,005 $ 1,153 The total amount of unrecognized tax benefits including interest and penalties that, if recognized, would affect the effective tax rate is $2.1 million and $1.3 million as of December 31, 2015 and 2014 , respectively. The Company recognizes interest, if any, related to unrecognized tax benefits as a component of income tax expense. As of December 31, 2015 and 2014 , the Company had recorded accrued interest and penalties related to unrecognized tax benefits of $0.2 million and $0.1 million , respectively. Due to an expected settlement within the next twelve months, an estimated $1.5 million of unrecognized tax benefits may be recognized during that twelve month period. |
EARNINGS PER SHARE
EARNINGS PER SHARE | 12 Months Ended |
Dec. 31, 2015 | |
Earnings Per Share [Abstract] | |
EARNINGS PER SHARE | EARNINGS PER SHARE Basic EPS is computed by dividing income available to common shareholders by the weighted average number of common shares outstanding for the period. Diluted EPS reflects the assumed conversion of all dilutive securities using the treasury stock method. Basic and diluted EPS are calculated as follows for the years ended December 31: (in thousands, except per share data) 2015 2014 2013 Net income attributable to Altisource $ 41,598 $ 134,484 $ 129,973 Weighted average common shares outstanding, basic 19,504 21,625 23,072 Dilutive effect of stock options and restricted shares 1,115 2,009 1,981 Weighted average common shares outstanding, diluted 20,619 23,634 25,053 Earnings per share: Basic $ 2.13 $ 6.22 $ 5.63 Diluted $ 2.02 $ 5.69 $ 5.19 For the years ended December 31, 2015 , 2014 and 2013 , 0.6 million options, less than 0.1 million options and less than 0.1 million options, respectively, that were anti-dilutive have been excluded from the computation of diluted EPS. These options were anti-dilutive and excluded from the computation of diluted EPS because their exercise price was greater than the average market price of our common stock. Also excluded from the computation of diluted EPS are 0.3 million options, 0.1 million options and 0.1 million options for the years ended December 31, 2015 , 2014 and 2013 , respectively, granted for shares that are issuable upon the achievement of certain market and performance criteria related to our common stock price and an annualized rate of return to investors that have not yet been met. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Dec. 31, 2015 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS, CONTINGENCIES AND REGULATORY MATTERS | COMMITMENTS, CONTINGENCIES AND REGULATORY MATTERS Litigation From time to time, we are involved in legal and administrative proceedings arising in the course of our business. We record a liability for these matters if an unfavorable outcome is probable and the amount of loss can be reasonably estimated, including expected insurance coverage. For proceedings where the reasonable estimate of loss is a range, we record a best estimate of loss within the range. On September 8, 2014, the West Palm Beach Firefighters’ Pension Fund filed a putative securities class action suit against Altisource Portfolio Solutions S.A. and certain of its current or former officers and directors in the United States District Court for the Southern District of Florida alleging violations of the Securities Exchange Act of 1934 and Rule 10b-5 with regard to disclosures concerning pricing and transactions with related parties that allegedly inflated Altisource Portfolio Solutions S.A. share prices. The Court subsequently appointed the Pension Fund for the International Union of Painters and Allied Trades District Council 35 and the Annuity Fund for the International Union of Painters and Allied Trades District Council 35 as Lead Plaintiffs. On January 30, 2015, Lead Plaintiffs filed an amended class action complaint which added Ocwen Financial Corporation as a defendant, and seeks a determination that the action may be maintained as a class action on behalf of purchasers of Altisource Portfolio Solutions S.A. securities between April 25, 2013 and December 21, 2014 and an unspecified amount of damages. Altisource Portfolio Solutions S.A. moved to dismiss the suit on March 23, 2015. On September 4, 2015, the Court granted the defendants’ motion to dismiss, finding that the Lead Plaintiffs’ amended complaint failed to state a claim as to any of the defendants, but permitting the Lead Plaintiffs to file another amended complaint. Lead Plaintiffs subsequently filed second and third amended complaints with substantially similar claims and theories. Altisource Portfolio Solutions S.A. moved to dismiss the third amended complaint on October 22, 2015. On December 22, 2015, the Court issued an order dismissing with prejudice all claims against Ocwen Financial Corporation and certain claims against Altisource Portfolio Solutions S.A. and the officer and director defendants, but denying the motion to dismiss as to other claims. Altisource Portfolio Solutions S.A. intends to continue to vigorously defend this suit. On February 11, 2015, W.A. Sokolowski, an alleged shareholder of Ocwen Financial Corporation, filed an amended shareholder derivative complaint in the United States District Court for the Southern District of Florida against Ocwen Financial Corporation (as a nominal defendant), certain of its current or former officers and directors, Altisource Portfolio Solutions S.A. and other companies. The suit seeks recovery of an unspecified amount of damages for alleged breaches of fiduciary duty by Ocwen Financial Corporation’s officers and directors, which were allegedly aided and abetted by Altisource Portfolio Solutions S.A. and other defendants. Altisource Portfolio Solutions S.A. filed a motion to dismiss the complaint on November 9, 2015. While that motion was pending, additional lawsuits alleging similar claims for alleged breaches of fiduciary duty by current or former Ocwen Financial Corporation’s officers and directors were filed in or transferred to the Court. The Court subsequently consolidated these actions and denied Altisource Portfolio Solutions S.A.’s motion to dismiss the Sokolowski complaint without prejudice to re-file following appointment of lead counsel for the consolidated action and the filing or designation of an operative complaint. Altisource Portfolio Solutions S.A. intends to vigorously defend the lawsuit and to move to dismiss all claims against it. On March 26, 2015, Robert Moncavage, an alleged shareholder of Ocwen Financial Corporation, filed an amended shareholder derivative complaint in the Circuit Court of the Fifteenth Judicial Circuit in and for Palm Beach County, Florida against Ocwen Financial Corporation, certain of its current or former officers and directors, Altisource Portfolio Solutions S.A. and other companies. The suit seeks recovery of an unspecified amount of damages for alleged breaches of fiduciary duty by the current or former Ocwen Financial Corporation’s officers and directors, which were allegedly aided and abetted by Altisource Portfolio Solutions S.A. and other defendants. On November 9, 2015, the Court entered an order staying all proceedings in the case pending further order of the Court. If the litigation proceeds, Altisource Portfolio Solutions S.A. intends to vigorously defend the lawsuit and to move to dismiss all claims against it. Altisource is unable to predict the outcomes of these lawsuits or reasonably estimate the potential loss, if any, arising from the suits, given the forthcoming motions to dismiss in the second and third cases have not yet been adjudicated, a stay has been entered in the third case, discovery has not occurred in any of the cases and significant legal and factual issues remain to be determined in all three cases. In addition to the matters referenced above, we are involved in legal actions in the course of our business, some of which seek monetary damages. We do not believe that the outcome of these proceedings, both individually and in the aggregate, will have a material impact on our financial condition, results of operations or cash flows. Regulatory Matters Periodically, we are subject to audits and examinations by federal, state and local governmental authorities and receive subpoenas, civil investigative demands or other requests for information from such governmental authorities in connection with their regulatory or investigative authority. We are currently responding to such inquiries from governmental authorities relating to certain aspects of our business. We believe it is premature to predict the potential outcome or to estimate any potential financial impact in connection with these inquiries. Ocwen Related Matters Ocwen is our largest customer and 60% of our 2015 revenue was from Ocwen. Additionally, 21% of our 2015 revenue was earned on the portfolios serviced by Ocwen, when a party other than Ocwen selected Altisource as the service provider. During the fourth quarter of 2015, Altisource recorded an estimated loss in connection with an anticipated payment to Ocwen for obtaining a release of liability for Altisource related to Ocwen’s settlement of a particular case. While currently being negotiated, the ultimate resolution of the matter is not expected to result in a material loss in excess of the amount accrued. Ocwen has been and is subject to a number of federal and state regulatory investigations, inquiries and requests for information that have or could result in adverse regulatory actions against Ocwen. For example, as a result of various regulatory actions, Ocwen is (i) subject to an independent auditor’s review of compliance with California servicing laws and has agreed not to obtain any new servicing rights in California until the regulator is satisfied with future document requests, (ii) operating under the oversight of an on-site operations monitor imposed by the New York Department of Financial Services (“NYDFS”), which is assessing the adequacy and effectiveness of Ocwen’s operations, including information technology systems, (iii) required to perform benchmarking pricing studies for transactions with related parties (as that term is set forth in Ocwen’s consent order with the NYDFS), which are subject to periodic review by the monitor imposed by the NYDFS and (iv) subject to requirements under an agreement with the Consumer Finance Protection Bureau and various states attorneys general and agencies that imposed specific servicing guidelines and oversight by an independent national monitor. Additionally, as Ocwen has publicly disclosed, it has reached a resolution with the staff of the SEC related to an investigation of certain matters, including Ocwen’s business dealings with related party entities, including Altisource, and its amendments to its 2013 Annual Report on Form 10-K and Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2014, pursuant to which it will pay a civil monetary penalty and consent to the entry of an administrative order requiring that it cease and desist from violations of certain provisions of the Securities Exchange Act of 1934. In addition to these matters, Ocwen continues to be subject to other regulatory investigations, inquiries and requests for information and pending legal proceedings, and Ocwen may become subject to future federal and state regulatory investigations, inquiries and requests for information, any of which could also result in adverse regulatory or other actions against Ocwen. On April 6, 2015, HLSS completed the sale of substantially all of its assets to NRZ. As a result, as of September 30, 2015, NRZ owns the rights to approximately 77% of Ocwen’s non-government-sponsored enterprise (“non-GSE”) servicing rights. In connection with the sale, Ocwen and HLSS/NRZ amended their agreement to, among other things, eliminate HLSS/NRZ’s ability to transfer servicing away from Ocwen for a servicer rating downgrade for two years (unless HLSS/NRZ determine in good faith that a trustee, or other party entitled to terminate, intends to terminate Ocwen as the servicer) and extend the term of the initial six-year agreements by up to an additional two years. Under the amended agreement, HLSS/NRZ has the right (not necessarily the ability) to transfer servicing away from Ocwen if, among other circumstances, Ocwen fails to maintain certain minimum servicer ratings on or after April 6, 2017. As of December 31, 2015, we believe Ocwen’s servicer ratings were below the minimum rating. If Ocwen does not achieve the minimum required servicer ratings prior to April 6, 2017, HLSS/NRZ has the right to transfer certain of Ocwen’s servicing pursuant to its contract. Further, certain bondholders of Ocwen-serviced residential mortgage-backed securities (“RMBS”) have alleged that Ocwen, as servicer of certain mortgage-backed securities trusts, defaulted on these servicing agreements. Bondholders of RMBS may attempt to replace Ocwen as servicer as a result of such ratings downgrades or the alleged defaults. The foregoing may have significant and varied effects on Ocwen’s business and our continuing relationships with Ocwen. For example, Ocwen may be required to alter the way it conducts business, including the parties it contracts with for services (including information technology and software services), it may be required to seek changes to its existing pricing structure with us or otherwise, it may lose or sell some or all of its non-GSE servicing rights or subservicing arrangements or may lose one or more of its state servicing licenses. Additional regulatory actions may impose additional restrictions on or require changes in Ocwen’s business that would require it to sell assets or change its business operations. Any or all of these effects could result in our eventual loss of Ocwen as a customer or a reduction in the number and/or volume of services they purchase from us or the loss of other customers. If any of the following events occurred, Altisource’s revenue would be significantly lower and our results of operations would be materially adversely affected, including from the impairment or write-off of goodwill, intangible assets, property and equipment, other assets and accounts receivable: • Altisource loses Ocwen as a customer or there is a significant reduction in the volume of services they purchase from us • Ocwen loses or sells a significant portion or all of its non-GSE servicing rights or subservicing arrangements and Altisource fails to be retained as a service provider • Ocwen loses state servicing licenses in states with a significant number of loans in Ocwen’s servicing portfolio and Altisource fails to be retained as a service provider • The contractual relationship between Ocwen and Altisource changes significantly or there are significant changes to our pricing to Ocwen for services from which we generate material revenue Management cannot predict the outcome of the Ocwen related matters or the impact they may have on Altisource. However, in the event these Ocwen related matters materially negatively impact Altisource, we believe the impact to Altisource would occur over an extended period of time and the variable nature of our cost structure would allow us to realign our cost structure in line with remaining revenue. In this regard, we have a plan that allows us to efficiently execute on this realignment. We believe that transfers of Ocwen’s servicing rights to a successor servicer(s) would take an extended period of time because of the approval required from many parties, including regulators, rating agencies, RMBS trustees, lenders and others. During this period of time, we believe we would continue to generate revenue from the services we provide to the portfolio. Additionally, we have several growth initiatives that focus on diversifying and growing our revenue and customer base. Our major growth initiatives include: • Continue to grow our Servicer Solutions business • Continue to grow our Origination Solutions business • Continue to grow Owners.com, our consumer real estate offering • Continue to grow our Real Estate Investor Solutions business We have an established sales and marketing strategy to support each of these initiatives. Management believes our plans, together with current liquidity and cash flows from operations will be sufficient to meet working capital, capital expenditures, debt service and other cash needs. However, there can be no assurance that our plans would be successful or our operations would be profitable. Leases We lease certain premises and equipment under various operating lease agreements. Future minimum lease payments at December 31, 2015 under non-cancelable operating leases with an original term exceeding one year are as follows: (in thousands) Operating lease obligations 2016 $ 17,308 2017 15,085 2018 10,983 2019 7,451 2020 3,654 Thereafter 4,860 $ 59,341 Total operating lease expense, net of sublease income, was $20.0 million , $20.1 million and $12.8 million for the years ended December 31, 2015 , 2014 and 2013 , respectively. The operating leases generally relate to office locations and reflect customary lease terms which range from 1 to 7 years in duration. In connection with the acquisition of Equator (see Note 5 ), we executed a standby letter of credit in the amount of $0.7 million related to an office lease, secured by a restricted cash balance. In addition, we executed standby letters of credit totaling $1.7 million for three other office leases. Escrow and Trust Balances We hold customers’ assets in escrow and trust accounts at various financial institutions pending completion of certain real estate activities. We also hold cash in trust accounts at various financial institutions where contractual obligations mandate maintaining dedicated bank accounts for Financial Services collections. These amounts are held in escrow and trust accounts for limited periods of time and are not included in the consolidated balance sheets. Amounts held in escrow and trust accounts were $66.6 million and $62.5 million at December 31, 2015 and 2014 , respectively. |
SEGMENT REPORTING
SEGMENT REPORTING | 12 Months Ended |
Dec. 31, 2015 | |
Segment Reporting [Abstract] | |
SEGMENT REPORTING | SEGMENT REPORTING Our business segments are based upon our organizational structure, which focuses primarily on the services offered, and are consistent with the internal reporting used by our Chief Executive Officer (our Chief Operating Decision Maker) to evaluate operating performance and to assess the allocation of our resources. We classify our businesses into three reportable segments. The Mortgage Services segment provides services that span the mortgage and real estate lifecycle and are typically outsourced by loan servicers, loan originators, home investors and other sellers and buyers of single family homes. The Financial Services segment provides collection and customer relationship management services primarily to debt originators and servicers (e.g., credit card, auto lending, retail credit and mortgage) and the utility, insurance and hotel industries. The Technology Services segment provides a portfolio of software, data analytics and information technology infrastructure management services that support the efficient and compliant management of mortgage and real estate activities and marketplace transactions across the lifecycle. In addition, Corporate Items and Eliminations include eliminations of transactions between the reportable segments, interest expense and costs related to corporate support functions including executive, finance, law, compliance, human resources, vendor management, risk and sales and marketing costs not allocated to the business units. Intercompany transactions primarily consist of information technology infrastructure management services. Financial information for our segments is as follows: For the year ended December 31, 2015 (in thousands) Mortgage Financial Technology Corporate Consolidated Revenue $ 786,648 $ 88,448 $ 215,482 $ (39,112 ) $ 1,051,466 Cost of revenue 474,169 60,806 187,835 (35,483 ) 687,327 Gross profit (loss) 312,479 27,642 27,647 (3,629 ) 364,139 Selling, general and administrative expenses 105,153 18,707 29,902 67,106 220,868 Impairment losses — — 71,785 — 71,785 Change in the fair value of Equator earn out liability — — (7,591 ) — (7,591 ) Income (loss) from operations 207,326 8,935 (66,449 ) (70,735 ) 79,077 Other income (expense), net 506 58 61 (26,642 ) (26,017 ) Income (loss) before income taxes and non-controlling interests $ 207,832 $ 8,993 $ (66,388 ) $ (97,377 ) $ 53,060 For the year ended December 31, 2014 (in thousands) Mortgage Financial Technology Corporate Consolidated Revenue $ 793,143 $ 98,499 $ 227,300 $ (40,026 ) $ 1,078,916 Cost of revenue 486,387 64,338 192,426 (35,971 ) 707,180 Gross profit (loss) 306,756 34,161 34,874 (4,055 ) 371,736 Selling, general and administrative expenses 94,686 18,791 32,393 55,863 201,733 Impairment losses — — 37,473 — 37,473 Change in the fair value of Equator earn out liability — — (37,924 ) — (37,924 ) Income (loss) from operations 212,070 15,370 2,932 (59,918 ) 170,454 Other income (expense), net 204 62 (31 ) (23,424 ) (23,189 ) Income (loss) before income taxes and non-controlling interests $ 212,274 $ 15,432 $ 2,901 $ (83,342 ) $ 147,265 For the year ended December 31, 2013 (in thousands) Mortgage Financial Technology Corporate Consolidated Revenue $ 599,319 $ 92,958 $ 100,724 $ (24,644 ) $ 768,357 Cost of revenue 376,639 55,328 82,612 (22,099 ) 492,480 Gross profit (loss) 222,680 37,630 18,112 (2,545 ) 275,877 Selling, general and administrative expenses 46,522 15,571 12,435 39,282 113,810 Income (loss) from operations 176,158 22,059 5,677 (41,827 ) 162,067 Other income (expense), net (136 ) (10 ) 7 (19,595 ) (19,734 ) Income (loss) before income taxes and non-controlling interests $ 176,022 $ 22,049 $ 5,684 $ (61,422 ) $ 142,333 (in thousands) Mortgage Services Financial Services Technology Services Corporate Eliminations Consolidated Altisource Total assets: December 31, 2015 $ 325,461 $ 53,757 $ 165,778 $ 182,986 $ 727,982 December 31, 2014 313,550 56,096 250,059 168,516 788,221 Our services are provided to customers primarily located in the United States. Premises and equipment, net consist of the following, by country: (in thousands) December 31, December 31, United States $ 85,021 $ 88,274 India 21,187 27,082 Luxembourg 9,944 9,059 Philippines 2,664 3,344 Uruguay 305 — Total $ 119,121 $ 127,759 |
QUARTERLY FINANCIAL DATA (UNAUD
QUARTERLY FINANCIAL DATA (UNAUDITED) | 12 Months Ended |
Dec. 31, 2015 | |
Quarterly Financial Information Disclosure [Abstract] | |
QUARTERLY FINANCIAL DATA (UNAUDITED) | QUARTERLY FINANCIAL DATA (UNAUDITED) The following tables contain selected unaudited statement of operations information for each quarter of 2015 and 2014 . The following information reflects all normal recurring adjustments necessary for a fair presentation of the information for the periods presented. The operating results for any quarter are not necessarily indicative of results for any future period. Our business is affected by seasonality. 2015 quarter ended (1)(2)(3)(4) (in thousands, except per share data) March 31, June 30, September 30, December 31, Revenue $ 240,482 $ 268,321 $ 272,776 $ 269,887 Gross profit 67,656 100,162 98,926 97,395 Income (loss) before income taxes and non-controlling interests 4,808 51,244 41,200 (44,192 ) Net income (loss) 4,408 46,846 37,897 (44,351 ) Net income (loss) attributable to Altisource 3,698 45,950 37,046 (45,096 ) Earnings (loss) per share: Basic $ 0.18 $ 2.35 $ 1.94 $ (2.35 ) Diluted $ 0.18 $ 2.22 $ 1.82 $ (2.35 ) Weighted average shares outstanding: Basic 20,172 19,571 19,091 19,196 Diluted 20,995 20,669 20,411 19,196 2014 quarter ended (1)(5) (in thousands, except per share data) March 31, June 30, September 30, December 31, Revenue $ 239,269 $ 296,072 $ 287,688 $ 255,887 Gross profit 91,464 112,073 98,964 69,235 Income (loss) before income taxes and non-controlling interests 43,201 58,225 45,867 (28 ) Net income (loss) 40,146 54,732 43,115 (906 ) Net income (loss) attributable to Altisource 39,631 54,101 42,287 (1,535 ) Earnings (loss) per share: Basic $ 1.76 $ 2.45 $ 1.96 $ (0.08 ) Diluted $ 1.61 $ 2.24 $ 1.79 $ (0.08 ) Weighted average shares outstanding: Basic 22,509 22,089 21,626 20,306 Diluted 24,662 24,166 23,640 20,306 ___________________________________________________ (1) The sum of quarterly amounts, including per share amounts, may not equal amounts reported for year-to-date periods. This is due to the effects of rounding and changes in the number of weighted average shares outstanding for each period. (2) We acquired CastleLine on July 17, 2015 and the Acquired RentRange and Investability Businesses on October 9, 2015 (see Note 5 ). (3) During the fourth quarter of 2015, Altisource recorded an estimated loss in connection with an anticipated payment to Ocwen for obtaining a release of liability for Altisource related to Ocwen’s settlement of a particular case. While currently being negotiated, the ultimate resolution of the matter is not expected to result in a material loss in excess of the amount accrued. (4) In the fourth quarter of 2015, we recorded impairment losses of $71.8 million in our Technology Services segment primarily driven by the Company’s current projected Technology Services revenue from Ocwen and investment in technologies provided to Ocwen (see Notes 9 and 10). (5) We acquired Mortgage Builder on September 12, 2014 and Owners on November 21, 2014 (see Note 5 ). |
SCHEDULE II. VALUATION AND QUAL
SCHEDULE II. VALUATION AND QUALIFYING ACCOUNTS (Notes) | 12 Months Ended |
Dec. 31, 2015 | |
Valuation and Qualifying Accounts [Abstract] | |
Schedule II Valuation and Qualifying Accounts | SCHEDULE II. VALUATION AND QUALIFYING ACCOUNTS For the years ended December 31, 2015 , 2014 and 2013 : Additions Balance at Charged to Beginning of Charged to Other Accounts Deductions Balance at (in thousands) Period Expenses Note (a)(b) Note (c)(d) End of Period Deductions from asset accounts: Allowance for doubtful accounts: Year 2015 $ 22,675 $ 5,514 $ (4 ) $ 9,729 $ 18,456 Year 2014 5,631 16,257 1,399 612 22,675 Year 2013 3,274 2,549 — 192 5,631 Valuation allowance for deferred tax assets: Year 2015 $ 3,115 $ 674 $ — $ 231 $ 3,558 Year 2014 3,189 — — 74 3,115 Year 2013 2,413 — 776 — 3,189 ______________________________________ (a) Allowance for doubtful accounts primarily includes amounts previously written off which were credited directly to this account when recovered. (b)Valuation allowance for deferred tax assets includes current year increase to valuation allowance charged to equity and reclassifications from other balance sheet accounts. (c) Amounts written off as uncollectible or transferred to other accounts or utilized. (d) Reductions to valuation allowances related to deferred tax assets. |
BASIS OF PRESENTATION AND SUM33
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2015 | |
Accounting Policies [Abstract] | |
Basis of Accounting | Basis of Accounting and Presentation - The consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”). Intercompany transactions and accounts have been eliminated in consolidation. |
Principles of Consolidation | Principles of Consolidation - The financial statements include the accounts of the Company, its wholly-owned subsidiaries and those entities in which we have a variable interest and are the primary beneficiary. The Mortgage Partnership of America, L.L.C. (“MPA”), a wholly-owned subsidiary of Altisource, serves as the manager of Best Partners Mortgage Cooperative, Inc., doing business as the Lenders One ® mortgage cooperative (“Lenders One”). MPA provides services to Lenders One under a management agreement that ends on December 31, 2025. MPA acts on behalf of Lenders One and its members principally to provide its members with opportunities to: (i) expand revenue, (ii) reduce loan underwriting costs, (iii) increase operational efficiency and (iv) receive critical education and training. For providing these services, MPA receives payments from Lenders One, and in some instances the vendors, based primarily upon the benefits achieved for the members. The management agreement provides MPA with broad powers such as recruiting members for Lenders One, collection of fees and other obligations from members of Lenders One, processing of all rebates owed to Lenders One and negotiating and executing contracts with vendors including executing contracts on behalf of Lenders One. In September 2014, we launched Best Partners Mortgage Brokers Cooperative, Inc., doing business as the Wholesale One ® Mortgage Cooperative (“Wholesale One”), for the wholesale mortgage market. Wholesale One assists mortgage brokers and wholesale lenders with tools to improve their businesses and obtain better access to the capital markets. In April 2015, we launched Best Partners Residential Investor Cooperative, Inc., doing business as the Residential Investor One™ cooperative (“Residential Investor One”). Residential Investor One was formed to deliver savings and efficiencies to individual and institutional residential real estate investors. MPA provides services to both Wholesale One and Residential Investor One under management agreements that end on July 8, 2039 (with automatic renewals for three successive five-year periods) and March 12, 2040 (with automatic renewals for three successive five-year periods), respectively. The management agreements provide MPA with broad powers such as recruiting members for Wholesale One and Residential Investor One, collection of fees and other obligations from members of Wholesale One and Residential Investor One, processing of all fees owed to Wholesale One and Residential Investor One and negotiating and executing contracts with vendors including executing contracts on behalf of Wholesale One and Residential Investor One. The management agreements between MPA and Lenders One, Wholesale One and Residential Investor One, pursuant to which MPA is the management company of each of these cooperatives, represent variable interests in variable interest entities. MPA is the primary beneficiary of Lenders One, Wholesale One and Residential Investor One as it has the power to direct the activities that most significantly impact each of these cooperatives’ economic performance and the right to receive benefits from each of these cooperatives. As a result, Lenders One, Wholesale One and Residential Investor One are presented in the accompanying consolidated financial statements on a consolidated basis with the interests of the members reflected as non-controlling interests. |
Use of Estimates | Use of Estimates - The preparation of financial statements in conformity with GAAP requires estimates and assumptions that affect the reported amounts of assets and liabilities, revenue and expenses and related disclosures of contingent liabilities in the consolidated financial statements and accompanying notes. Estimates are used for, but not limited to, determining share-based compensation, income taxes, collectability of receivables, valuation of acquired intangibles and goodwill, depreciable lives of fixed assets and contingencies. Actual results could differ materially from those estimates. |
Cash and Cash Equivalents | Cash and Cash Equivalents - We classify all highly liquid instruments with an original maturity of three months or less at the time of purchase as cash equivalents. |
Accounts Receivable, Net | Accounts Receivable, Net - Accounts receivable are presented net of an allowance for doubtful accounts that represents an amount that we estimate to be uncollectible. We have estimated the allowance for doubtful accounts based on our historical write-offs, our analysis of past due accounts based on the contractual terms of the receivables and our assessment of the economic status of our customers, if known. The carrying value of accounts receivable, net, approximates fair value. |
Premises and Equipment, Net | Premises and Equipment, Net - We report premises and equipment, net at cost or estimated fair value at acquisition for premises and equipment recorded in connection with a business combination and depreciate these assets over their estimated useful lives using the straight-line method as follows: Furniture and fixtures 5 years Office equipment 5 years Computer hardware 5 years Computer software 3-7 years Leasehold improvements Shorter of useful life, 10 years or the term of the lease Maintenance and repair costs are expensed as incurred. We capitalize expenditures for significant improvements and new equipment and depreciate the assets over the shorter of the capitalized asset’s life or the life of the lease. We review premises and equipment for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset or asset group may not be recoverable. We measure recoverability of assets to be held and used by comparing the carrying amount of an asset or asset group to estimated undiscounted future cash flows expected to be generated by the asset or asset group. If the carrying amount of an asset or asset group exceeds its estimated future cash flows, we recognize an impairment charge for the amount that the carrying value of the asset or asset group exceeds the fair value of the asset or asset group. For the year ended December 31, 2015, we recognized a $4.1 million premises and equipment impairment loss. See Note 9 for additional information. There were no impairments of premises and equipment for the years ended December 31, 2014 and 2013 . Computer software includes the fair value of software acquired in business combinations, capitalized software development costs and purchased software. Capitalized software development and purchased software are recorded at cost and amortized using the straight-line method over its estimated useful life. Software acquired in business combinations is recorded at its fair value and amortized using the straight-line method over its estimated useful life. |
Business Combinations | Business Combinations - We account for acquisitions using the purchase method of accounting in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 805, Business Combinations . The purchase price of an acquisition is allocated to the assets acquired and liabilities assumed using their fair value as of the acquisition date. |
Goodwill | Goodwill - Goodwill represents the excess cost of an acquired business over the fair value of the identifiable tangible and intangible assets acquired and liabilities assumed in a business combination. We evaluate goodwill for impairment annually during the fourth quarter or more frequently when an event occurs or circumstances change in a manner that indicates the carrying value may not be recoverable. During 2015, we changed the measurement date of our annual goodwill impairment test from November 30 th to December 31 st in order to better align our measurement date with our financial projections. There was no impact of this change. We first assess qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying value as a basis for determining whether we need to perform the quantitative two-step goodwill impairment test. Only if we determine, based on qualitative assessment, that it is more likely than not that a reporting unit’s fair value is less than its carrying value will we calculate the fair value of the reporting unit. We would then test goodwill for impairment by first comparing the book value of net assets to the fair value of the reporting units. If the fair value is determined to be less than the book value, a second step is performed to compute the amount of impairment as the difference between the estimated fair value of goodwill and the carrying value. We estimate the fair value of the reporting units using discounted cash flows. The discounted cash flow method is based on the present value of projected cash flows. Forecasts of future cash flows are based on our estimate of future sales and operating expenses, based primarily on estimated pricing, sales volumes, market segment share, cost trends and general economic conditions. Certain estimates of discounted cash flows involve businesses with limited financial history and developing revenue models. The estimated cash flows are discounted using a rate that represents our weighted average cost of capital. |
Intangible Assets, Net | Intangible Assets, Net - Identified intangible assets consist primarily of customer related intangible assets, operating agreements, trademarks and trade names and other intangible assets. Identifiable intangible assets acquired in business combinations are recorded based on their fair values at the date of acquisition. We determine the useful lives of our identifiable intangible assets after considering the specific facts and circumstances related to each intangible asset. Factors we consider when determining useful lives include the contractual term of any arrangements, the history of the asset, our long-term strategy for use of the asset and other economic factors. We amortize intangible assets that we deem to have definite lives in proportion to actual and expected customer revenues or on a straight-line basis over their useful lives, generally ranging from 4 to 20 years. |
Debt Issuance Costs and Long-Term Debt | Debt Issuance Costs - Debt issuance costs are capitalized and amortized to interest expense through maturity of the related debt using the effective interest method. Long-Term Debt - Long-term debt is reported net of applicable discount or premium. The debt discount or premium is amortized to interest expense through maturity of the related debt using the effective interest method. |
Fair Value Measurements | Fair Value Measurements - Fair value is defined as an exit price, representing the amount that would be received for an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The three-tier hierarchy for inputs used in measuring fair value, which prioritizes the inputs used in the methodologies of measuring fair value for assets and liabilities, is as follows: Level 1 — Quoted prices in active markets for identical assets and liabilities Level 2 — Observable inputs other than quoted prices included in Level 1 Level 3 — Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of assets or liabilities. Financial assets and financial liabilities are classified based on the lowest level of input that is significant to the fair value measurements. Our assessment of the significance of a particular input to the fair value measurements requires judgment and may affect the valuation of the assets and liabilities being measured and their placement within the fair value hierarchy. |
Functional Currency | Functional Currency - The currency of the primary economic environment in which our operations are conducted is the United States dollar. Therefore, the United States dollar has been determined to be our functional and reporting currency. Non-United States dollar transactions and balances have been measured in United States dollars in accordance with ASC Topic 830, Foreign Currency Matters . All transaction gains and losses from the measurement of monetary balance sheet items denominated in non-United States dollar currencies are reflected in the consolidated statements of operations as income or expenses, as appropriate. |
Defined Contribution 401(k) Plan | Defined Contribution 401(k) Plan - Some of our employees currently participate in a defined contribution 401(k) plan under which we may make matching contributions equal to a discretionary percentage determined by us. |
Share-Based Compensation | Share-Based Compensation - Share-based compensation is accounted for under the provisions of ASC Topic 718, Compensation - Stock Compensation . Under ASC Topic 718, the cost of employee services received in exchange for an award of equity instruments is generally measured based on the grant date fair value of the award. Share-based awards that do not require future service are expensed immediately. Share-based employee awards that require future service are recognized over the relevant service period. Further, as required under ASC Topic 718, we estimate forfeitures for share-based awards that are not expected to vest. |
Earnings Per Share | Earnings Per Share - We compute earnings per share (“EPS”) in accordance with ASC Topic 260, Earnings Per Share . Basic net income per share is computed by dividing net income attributable to Altisource by the weighted average number of shares of common stock outstanding for the period. Diluted net income per share reflects the assumed conversion of all dilutive securities. |
Revenue Recognition | Revenue Recognition - We recognize revenue from the services we provide in accordance with ASC Topic 605, Revenue Recognition . ASC Topic 605 sets forth guidance as to when revenue is realized or realizable and earned, which is generally when all of the following criteria are met: (1) persuasive evidence of an arrangement exists; (2) delivery has occurred or services have been performed; (3) the seller’s price to the buyer is fixed or determinable; and (4) collectability is reasonably assured. Generally, the contract terms for these services are relatively short in duration, and we recognize revenue as the services are performed either on a per unit or a fixed price basis. Specific policies for each of our reportable segments are as follows: Mortgage Services segment : We recognize revenue for the majority of the services we provide when the services have been performed. For default processing services and certain property preservation services, we recognize revenue over the period during which we perform the related services, with full recognition upon recording the related foreclosure deed or on closing of the related real estate transaction. We record revenue associated with real estate sales on a net basis as we perform services as an agent without assuming the risks and rewards of ownership of the asset and the commission earned on the sale is a fixed percentage. Reimbursable expenses of $107.2 million , $137.4 million and $102.0 million incurred for the years ended December 31, 2015 , 2014 and 2013 , respectively, are included in revenue with an equal offsetting expense included in cost of revenue primarily related to our property preservation and default processing services. These amounts are recognized on a gross basis, principally because we have complete control over selection of vendors and the vendor relationship is with us, rather than with our customers. Financial Services segment : We generally earn our fees for asset recovery management services as a percentage of the amount we collect on delinquent consumer receivables and charged-off mortgages on behalf of our clients and recognize revenue upon collection from the debtors. We also earn fees for packaging and selling charged-off mortgages and recognize revenue after the sale of the notes and once the risks and rewards of the mortgage notes are transferred to the purchasers. In addition, we provide customer relationship management services for which we earn and recognize revenue on a per-person, per-call or per-minute basis as the related services are performed. Technology Services segment : For our software services, we charge based on the number of loans on the system or on a per-transaction basis. We record transactional revenue when the service is provided and other revenue monthly based on the number of loans processed or services provided. In addition, we charge fees for professional services engagements, which consist primarily of time and materials agreements with customers that are generally billed and recognized as the hours are worked. For Equator software applications, we recognize revenue from arrangements with multiple deliverables in accordance with ASC Subtopic 605-25, Revenue Recognition: Multiple-Element Arrangements (“ASC 605-25”), and Securities and Exchange Commission (“SEC”) Staff Accounting Bulletin Topic 13, Revenue Recognition (“SAB Topic 13”). ASC 605-25 and SAB Topic 13 require each deliverable within a multiple-deliverable revenue arrangement to be accounted for as a separate unit if both of the following criteria are met: (1) the delivered item or items have value to the customer on a standalone basis and (2) for an arrangement that includes a general right of return relative to the delivered item(s), delivery or performance of the undelivered item(s) is considered probable and substantially in the seller’s control. Deliverables not meeting the criteria for accounting treatment as a separate unit are combined with a deliverable that meets that criterion. We derive revenue from platform services fees, professional services fees and other services. We do not begin to recognize revenue for platform services fees until these fees become billable, as the services fees are not fixed and determinable until such time. Platform services fees are recognized ratably over the shorter of the term of the contract with the customer or the minimum cancellation period. Professional services fees consist primarily of configuration services related to customizing the platform for individual customers and are generally billed as the hours are worked. Due to the essential and specialized nature of the configuration services, these services do not qualify as separate units of accounting separate from the platform services as the delivered services do not have value to the customer on a standalone basis. Therefore, the related fees are recorded as deferred revenue until the project configuration is complete and then recognized ratably over the longer of the term of the agreement or the estimated expected customer life. Other services consist primarily of training, including agent certification, and consulting services. These services are generally sold separately and are recognized as revenue as the services are performed and earned. For Mortgage Builder software applications, we recognize subscription revenues ratably over the contract term, beginning on the commencement date of each contract. Revenues for usage-based transactions are generally recognized as the usage occurs, as that is the point when the fee becomes fixed or determinable. We generally invoice customers on a monthly basis. We provide information technology infrastructure services to Ocwen Financial Corporation and its subsidiaries (“Ocwen”), Altisource Residential Corporation (“Residential”) and Altisource Asset Management Corporation (“AAMC”) and charge for these services primarily based on the number of employees that are using the applicable systems and the number and type of licensed platforms used by Ocwen, Residential and AAMC. We record revenue associated with implementation services upon completion and maintenance ratably over the related service period. Significant areas of judgment include the period over which we recognize property preservation revenue and certain default management services revenue. |
Income Taxes | Income Taxes - We account for certain income and expense items differently for financial reporting purposes and income tax purposes. We recognize deferred income tax assets and liabilities for these differences between the financial reporting basis and the tax basis of our assets and liabilities as well as expected benefits of utilizing net operating loss and credit carryforwards. The most significant temporary differences relate to accrued compensation, amortization and loss and credit carryforwards. We measure deferred income tax assets and liabilities using enacted tax rates expected to apply to taxable income in the years in which we anticipate recovery or settlement of those temporary differences. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period when the change is enacted. Deferred tax assets are reduced by a valuation allowance when it is more likely than not that some portion or all of the deferred tax assets will not be realized. In 2015, the Company early-adopted FASB Accounting Standards Update (“ASU”) No. 2015-17, Income Taxes (Topic 740): Balance Sheet Classification of Deferred Taxes . This standard simplifies the presentation of deferred taxes by requiring that deferred tax assets and deferred tax liabilities be classified as non-current in an entity’s balance sheet. We have adopted this standard prospectively. Accordingly, prior periods were not retrospectively adjusted. Tax laws are complex and subject to different interpretations by the taxpayer and respective governmental taxing authorities. Significant judgment is required in determining tax expense and in evaluating tax positions including evaluating uncertainties under ASC Topic 740, Income Taxes (“ASC Topic 740”). We recognize tax benefits from uncertain tax positions only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. The tax benefits recognized in the financial statements from such positions are then measured based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement. Resolution of these uncertainties in a manner inconsistent with management’s expectations could have a material impact on our results of operations. |
Adoption/Future Adoption of New Accounting Pronouncements | Future Adoption of New Accounting Pronouncements In May 2014, FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606) . This standard establishes a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most current revenue recognition guidance. The core principle of the new standard is an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. In August 2015, in response to stakeholders’ requests to defer the effective date of ASU 2014-09 and in consideration of feedback received through extensive outreach with preparers, practitioners and users of financial statements, the FASB deferred the effective date for all entities by one year. This new standard will be effective for annual reporting periods beginning after December 15, 2017, including interim periods within that reporting period. Early adoption is permitted, although not prior to annual reporting periods beginning after December 15, 2016. The Company is currently evaluating the impact this new guidance may have on its results of operations and financial position. In February 2015, FASB issued ASU No. 2015-02, Consolidation (Topic 810): Amendments to the Consolidation Analysis . This standard addresses the consolidation of certain legal entities relative to current requirements under GAAP of a reporting entity to consolidate another legal entity in situations in which the reporting entity’s contractual rights do not give it the ability to act primarily on its own behalf, the reporting entity does not hold a majority of the legal entity’s voting rights or the reporting entity is not exposed to a majority of the legal entity’s economic benefits or obligations. This standard will be effective for annual reporting periods beginning after December 15, 2015, including interim periods within that reporting period. Early adoption is permitted, including adoption in an interim period. If an entity early adopts the standard in an interim period, any adjustments should be reflected as of the beginning of the year that includes that interim period. The Company does not expect the adoption of this standard to have a material impact on its results of operations or financial position. In April 2015, FASB issued ASU No. 2015-03, Interest-Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs. This standard changes the presentation of debt issuance costs in financial statements. Under the ASU, an entity presents such costs in the balance sheet as a direct deduction from the related debt liability rather than as an asset. This standard will be effective for annual reporting periods beginning after December 15, 2015, including interim periods within that reporting period. Early adoption is permitted for financial statements that have not been previously issued. As of December 31, 2015, the Company’s total non-current assets were $421.9 million (including other assets of $19.3 million ), net long-term debt (including current portion) was $534.4 million and debt issuance costs, net of amortization, were $6.2 million (included in other assets). As of December 31, 2015, adoption of this ASU would have reduced other assets and net long-term debt by $6.2 million . Consequently, the Company does not expect the adoption of this standard to have a material impact on its results of operations or financial position. In September 2015, FASB issued ASU No. 2015-16, Business Combinations (Topic 805): Simplifying the Accounting for Measurement-Period Adjustments . This standard requires that adjustments to provisional amounts that are identified during the measurement period are recognized in the reporting period in which the adjustment amounts are determined rather than recognizing the adjustments retrospectively. The standard also requires that the acquirer records, in the same period’s financial statements, the effect on earnings of changes in depreciation, amortization or other income effects, if any, as a result of the change to the provisional amounts, calculated as if the accounting had been completed at the acquisition date. This standard will be effective for annual reporting periods beginning after December 15, 2015, including interim periods within that reporting period. Early adoption is permitted for financial statements that have not been previously issued. The Company does not expect the adoption of this standard to have a material impact on its results of operations or financial position. In January 2016, FASB issued ASU No. 2016-01, Financial Instruments - Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities . This standard will require equity investments (except those accounted for under the equity method of accounting or those that result in consolidation of the investee) to be measured at fair value with changes in fair value recognized in net income. The standard also simplifies the impairment assessment of equity investments without readily determinable fair values by requiring a qualitative assessment to identify impairment. When a qualitative assessment indicates that impairment exists, an entity is required to measure the investment at fair value. It also amends certain financial statement presentation and disclosure requirements associated with the fair value of financial instruments. This standard will be effective for annual periods beginning after December 15, 2017, including interim periods within that reporting period. Early adoption is not permitted. The Company is currently evaluating the impact this new guidance may have on its results of operations and financial position. In February 2016, FASB issued ASU No. 2016-02, Leases (Topic 842) . This new standard introduces a new lessee model that brings substantially all leases on the balance sheet. The standard will require companies to recognize lease assets and lease liabilities on their balance sheets and disclose key information about leasing arrangements in their financial statements. This standard will be effective for annual periods beginning after December 15, 2018, including interim periods within that reporting period. Early application of this standard is permitted. The Company is currently evaluating the impact this new guidance may have on its results of operations and financial position. |
BASIS OF PRESENTATION AND SUM34
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Accounting Policies [Abstract] | |
Schedule of estimated useful lives using the straight-line method | We report premises and equipment, net at cost or estimated fair value at acquisition for premises and equipment recorded in connection with a business combination and depreciate these assets over their estimated useful lives using the straight-line method as follows: Furniture and fixtures 5 years Office equipment 5 years Computer hardware 5 years Computer software 3-7 years Leasehold improvements Shorter of useful life, 10 years or the term of the lease |
CUSTOMER CONENTRATION (Tables)
CUSTOMER CONENTRATION (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Risks and Uncertainties [Abstract] | |
Schedule of Related Party Transactions | Revenue from Ocwen primarily consists of revenue earned directly from Ocwen and revenue earned from the loans serviced by Ocwen when Ocwen designates us as the service provider. Revenue from Ocwen as a percentage of segment and consolidated revenue was as follows for the years ended December 31: 2015 2014 2013 Mortgage Services 63% 67% 70% Financial Services 21% 27% 30% Technology Services 54% 42% 50% Consolidated revenue 60% 60% 65% |
ACQUISITIONS (Tables)
ACQUISITIONS (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
RentRange, Investability and Onit Solutions [Member] | |
Acquisitions | |
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed v2 [Table Text Block] | The preliminary allocation of the purchase price is as follows: (in thousands) Cash $ 3 Accounts receivable, net 245 Premises and equipment, net 1,206 Other assets 199 Software 1,265 Trademarks and trade names 1,205 Databases/other 910 Non-compete agreements 330 Customer relationships 255 Goodwill 19,565 25,183 Accounts payable and accrued expenses (391 ) Purchase price $ 24,792 |
CastleLine | |
Acquisitions | |
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed v2 [Table Text Block] | On July 17, 2015, we acquired CastleLine Holdings, LLC and its subsidiaries (“CastleLine”), a specialty risk management and insurance services firm. CastleLine provides financial products and services to parties involved in the origination, underwriting, purchase and securitization of residential mortgages. The purchase consideration was composed of $12.3 million of cash at closing, $10.5 million of cash payable over four years from the acquisition date and 495 thousand shares of restricted common stock of the Company with a value of $14.4 million as of the closing date. Of the cash payable following acquisition, $3.8 million is contingent on certain future employment conditions of certain of the sellers, and therefore excluded from the purchase price. The CastleLine acquisition is not material in relation to the Company’s results of operations or financial position. The preliminary allocation of the purchase price is as follows: (in thousands) Cash $ 1,088 Accounts receivable, net 510 Prepaid expenses 66 Restricted cash 2,501 Non-compete agreements 1,105 Databases/other 465 Customer relationships 395 Trademarks and trade names 150 Goodwill 28,125 34,405 Accounts payable and accrued expenses (875 ) Deferred revenue (87 ) Purchase price $ 33,443 |
Equator LLC | |
Acquisitions | |
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed v2 [Table Text Block] | Initial purchase price allocation Adjustments Adjusted purchase price allocation (in thousands) Accounts receivable $ 9,293 $ 3,490 $ 12,783 Prepaid expenses and other current assets 954 (393 ) 561 Premises and equipment 16,974 — 16,974 Customer relationships, trademarks and trade names 43,393 — 43,393 Goodwill 82,460 — 82,460 Other non-current assets 242 78 320 Assets acquired 153,316 3,175 156,491 Accounts payable and accrued expenses (7,232 ) 536 (6,696 ) Deferred revenue (36,689 ) — (36,689 ) Liabilities assumed (43,921 ) 536 (43,385 ) Purchase price $ 109,395 $ 3,711 $ 113,106 Estimated life (in years) Premises and equipment (excluding internally developed software) 3 - 5 Internally developed software (included in premises and equipment) 7 Customer relationships (weighted average) 15 Trade names 4 In accordance with ASC Topic 805, Business Combinations , the liability for contingent consideration is reflected at fair value and adjusted each reporting period with the change in fair value recognized in earnings. During 2014, the fair value of the contingent consideration related to the Equator acquisition was reduced by $37.9 million with a corresponding increase in earnings based on management’s revised estimates that expected earnings of Equator would be lower than projected at the time of acquisition. The reduction in fair value was recorded in 2014 and is reflected as a reduction of selling, general and administrative expenses in the consolidated statements of operations (see Note 19). See Note 10 for additional information on the impairment of Technology Services goodwill for the years ended December 31, 2015 and 2014, which includes Equator goodwill. |
Schedule of Estimated Life of Identifiable Assets Acquired as Part of Business Combination [Table Text Block] | Estimated life (in years) Premises and equipment (excluding internally developed software) 3 - 5 Internally developed software (included in premises and equipment) 7 Customer relationships (weighted average) 15 Trade names 4 |
Mortgage Builder | |
Acquisitions | |
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed v2 [Table Text Block] | On September 12, 2014, we acquired certain assets and assumed certain liabilities of Mortgage Builder Software, Inc. (“Mortgage Builder”) pursuant to a Purchase and Sale Agreement dated July 18, 2014 (the “Purchase and Sale Agreement”). Mortgage Builder is a provider of residential mortgage loan origination and servicing software systems. Pursuant to the terms of the Purchase and Sale Agreement, we paid $15.7 million at closing in cash (net of closing working capital adjustments). Additionally, the Purchase and Sale Agreement provides for the payment of up to $7.0 million in potential additional consideration (the “MB Earn-Out”) based on Adjusted Revenue (as defined in the Purchase and Sale Agreement) in the three consecutive 12-month periods following closing. At closing, we estimated the fair value of the MB Earn-Out to be $1.6 million determined based on the present value of future estimated MB Earn-Out payments. After the acquisition date, the allocation of the purchase price was adjusted based upon information that subsequently became available relating to acquisition date working capital, resulting in an obligation of the sellers to pay the Company $0.2 million . The Mortgage Builder acquisition and the adjustment to the preliminary allocation of the purchase price are not material in relation to the Company’s results of operations or financial position. The final adjusted allocation of the purchase price is as follows: (in thousands) Cash $ 668 Accounts receivable, net 1,102 Prepaid expenses 38 Premises and equipment, net 553 Software 1,509 Trademarks and trade names 209 Customer relationships 4,824 Goodwill 9,135 18,038 Accounts payable and accrued expenses (950 ) Purchase price $ 17,088 |
Owners.com | |
Acquisitions | |
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed v2 [Table Text Block] | The final allocation of the purchase price is as follows: (in thousands) Accounts receivable, net $ 32 Prepaid expenses 28 Software 501 Trademarks and trade names 1,431 Goodwill 19,775 21,767 Accounts payable (22 ) Purchase price $ 21,745 |
Residential Capital LLC Mortgage Servicing Platform Assets [Member] | |
Acquisitions | |
Schedule of Estimated Life of Identifiable Assets Acquired as Part of Business Combination [Table Text Block] | ResCap Fee-Based Businesses On April 12, 2013, we entered into an agreement with Ocwen to establish additional terms related to the existing servicing arrangements between Altisource and Ocwen in connection with certain mortgage servicing platform assets of ResCap (the “ResCap Business”). The agreement provides that (i) Altisource will be a provider to Ocwen of certain services related to the ResCap Business, (ii) Ocwen will not establish similar fee-based businesses that would directly or indirectly compete with Altisource’s services as they relate to the ResCap Business and (iii) Ocwen will market and promote the utilization of Altisource’s services to their various third party relationships. Additionally, the parties agreed to use commercially reasonable best efforts to ensure that the loans associated with the ResCap Business are boarded onto Altisource’s mortgage servicing platform. We paid $128.8 million to Ocwen in connection with the ResCap fee-based businesses agreement. We acquired no tangible assets and assumed no liabilities in connection with the ResCap transaction. However, certain employees as well as practices and processes developed to support the ResCap servicing portfolio were components of the transaction. We accounted for this transaction as a business combination in accordance with ASC Topic 805, Business Combinations . Management prepared a final purchase price allocation and assigned associated asset lives based upon available information at the time of the agreement and until finalized as of December 31, 2013. The agreement consideration of $128.8 million was fully allocated to the customer relationship intangible asset with an estimated average useful life of 7 years . |
Homeward Servicing Portfolio | |
Acquisitions | |
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed v2 [Table Text Block] | The final adjusted allocation of the purchase price is as follows: (in thousands) Premises and equipment $ 1,559 Customer relationship 75,609 Goodwill 2,039 79,207 Accounts payable and accrued expenses (3,390 ) Purchase price $ 75,817 |
Schedule of Estimated Life of Identifiable Assets Acquired as Part of Business Combination [Table Text Block] | Estimated life (in years) Premises and equipment 3 - 5 Customer relationships 7 |
Equator, ResCap and Homeward | |
Acquisitions | |
Business Acquisition, Pro Forma Information [Table Text Block] | The following table presents the unaudited pro forma consolidated results of operations for the year ended December 31, 2013 as if the Equator, ResCap and Homeward transactions had occurred at the beginning of the period presented. Year ended December 31, 2013 (in thousands, except per share amounts) As reported Pro forma Revenue $ 768,357 $ 854,098 Net income attributable to Altisource 129,973 132,907 Earnings per share — diluted 5.19 5.31 |
FAIR VALUE (Tables)
FAIR VALUE (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Fair Value Disclosures [Abstract] | |
Fair value methodologies | The fair values are estimated using market information and what the Company believes to be appropriate valuation methodologies under GAAP: December 31, 2015 December 31, 2014 (in thousands) Carrying Amount Fair Value Carrying Amount Fair Value Level 1 Level 2 Level 3 Level 1 Level 2 Level 3 Cash and cash equivalents $ 179,327 $ 179,327 $ — $ — $ 161,361 $ 161,361 $ — $ — Restricted cash 4,801 4,801 — — 3,022 3,022 — — Long-term debt 536,598 — 469,523 — 591,543 — 467,319 — |
ACCOUNTS RECEIVABLE, NET (Table
ACCOUNTS RECEIVABLE, NET (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Receivables [Abstract] | |
Schedule of accounts receivable, net | Accounts receivable, net consists of the following as of December 31: (in thousands) 2015 2014 Billed $ 67,021 $ 73,532 Unbilled 56,458 61,326 123,479 134,858 Less: allowance for doubtful accounts (18,456 ) (22,675 ) Total $ 105,023 $ 112,183 |
PREPAID EXPENSES AND OTHER CU39
PREPAID EXPENSES AND OTHER CURRENT ASSETS (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Schedule of prepaid expenses and other current assets | Prepaid expenses and other current assets consist of the following as of December 31: (in thousands) 2015 2014 Maintenance agreements, current portion $ 7,000 $ 6,367 Income taxes receivable 633 5,258 Prepaid expenses 7,873 6,989 Other current assets 6,245 4,953 Total $ 21,751 $ 23,567 |
PREMISES AND EQUIPMENT, NET (Ta
PREMISES AND EQUIPMENT, NET (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Property, Plant and Equipment [Abstract] | |
Schedule of premises and equipment, net | Premises and equipment, net consists of the following as of December 31: (in thousands) 2015 2014 Computer hardware and software $ 177,010 $ 140,799 Office equipment and other 21,720 36,032 Furniture and fixtures 14,443 12,231 Leasehold improvements 35,503 34,069 248,676 223,131 Less: accumulated depreciation and amortization (129,555 ) (95,372 ) Total $ 119,121 $ 127,759 |
GOODWILL AND INTANGIBLE ASSET41
GOODWILL AND INTANGIBLE ASSETS, NET (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Summary of changes in goodwill | Changes in goodwill during the years ended December 31, 2015 and 2014 are summarized below: (in thousands) Mortgage Services Financial Services Technology Services Total Balance January 1, 2014 $ 12,958 $ 2,378 $ 84,078 $ 99,414 Acquisition of Mortgage Builder — — 9,135 9,135 Acquisition of Owners 19,775 — — 19,775 Impairment of Equator goodwill — — (37,473 ) (37,473 ) Balance, December 31, 2014 32,733 2,378 55,740 90,851 Acquisition of CastleLine 28,125 — — 28,125 Acquisition of Acquired RentRange and Investability Businesses 19,565 — — 19,565 Impairment of Technology Services goodwill — — (55,740 ) (55,740 ) Balance, December 31, 2015 $ 80,423 $ 2,378 $ — $ 82,801 |
Schedule of intangible assets, net | Intangible assets, net consist of the following as of December 31: Weighted useful life (in years) Gross carrying amount Accumulated amortization Net book value (in thousands) 2015 2014 2015 2014 2015 2014 Definite lived intangible assets: Trademarks and trade names 13 $ 15,244 $ 13,889 $ (6,491 ) $ (5,016 ) $ 8,753 $ 8,873 Customer related intangible assets 10 274,428 289,308 (113,725 ) (79,606 ) 160,703 209,702 Operating agreement 20 35,000 35,000 (10,354 ) (8,604 ) 24,646 26,396 Non-compete agreements 4 1,435 — (115 ) — 1,320 — Intellectual property 10 300 300 (55 ) (25 ) 245 275 Other intangible assets 5 1,375 — (39 ) — 1,336 — Total $ 327,782 $ 338,497 $ (130,779 ) $ (93,251 ) $ 197,003 $ 245,246 |
OTHER ASSETS (Tables)
OTHER ASSETS (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Schedule of other assets | Other assets consist of the following as of December 31: (in thousands) 2015 2014 Security deposits, net $ 5,341 $ 7,277 Debt issuance costs, net 6,184 8,099 Maintenance agreements, non-current portion 1,570 3,324 Restricted cash 4,801 3,022 Other 1,441 545 Total $ 19,337 $ 22,267 |
ACCOUNTS PAYABLE, ACCRUED EXP43
ACCOUNTS PAYABLE, ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Payables and Accruals [Abstract] | |
Schedule of accounts payable and accrued expenses | Accounts payable and accrued expenses consist of the following as of December 31: (in thousands) 2015 2014 Accounts payable $ 11,644 $ 28,280 Accrued expenses - general 30,347 31,693 Accrued salaries and benefits 46,564 44,150 Income taxes payable 3,316 7,643 Total $ 91,871 $ 111,766 |
Schedule of other current liabilities | Other current liabilities consist of the following as of December 31: (in thousands) 2015 2014 Unfunded cash account balances $ 6,395 $ 4,788 Other 9,871 8,439 Total $ 16,266 $ 13,227 |
LONG-TERM DEBT (Tables)
LONG-TERM DEBT (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Debt Disclosure [Abstract] | |
Schedule of long-term debt | Long-term debt consists of the following as of December 31: (in thousands) 2015 2014 Senior secured term loan $ 536,598 $ 591,543 Less: unamortized discount, net (2,236 ) (2,929 ) Net long-term debt 534,362 588,614 Less: current portion (5,945 ) (5,945 ) Long-term debt, less current portion $ 528,417 $ 582,669 Maturities of our long-term debt are as follows: (in thousands) 2016 $ 5,945 2017 5,945 2018 5,945 2019 5,945 2020 512,818 $ 536,598 |
OTHER NON-CURRENT LIABILITIES (
OTHER NON-CURRENT LIABILITIES (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Other Liabilities Disclosure [Abstract] | |
Schedule of other non current liabilities | Other non-current liabilities consist of the following as of December 31: (in thousands) 2015 2014 Acquisition related contingent consideration $ 3,932 $ 11,616 Other non-current liabilities 14,221 9,032 Total $ 18,153 $ 20,648 |
SHAREHOLDERS' EQUITY AND SHAR46
SHAREHOLDERS' EQUITY AND SHARE-BASED COMPENSATION (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Schedule of assumptions used to determine the fair value of options as of the grant date | The following assumptions were used to determine the fair value as of the grant date: 2015 2014 2013 Black-Scholes Binomial Black-Scholes Binomial Black-Scholes Binomial Risk-free interest rate (%) 1.50 – 1.91 0.02 – 2.34 1.80 – 1.91 0.01 – 2.49 1.02 – 1.81 0.01 – 2.71 Expected stock price volatility (%) 55.06 – 59.73 55.06 – 59.73 37.57 – 45.15 38.38 – 45.15 36.35 – 36.76 36.40 – 36.80 Expected dividend yield — — — — — — Expected option life (in years) 6.00 – 6.25 4.08 – 4.92 6.25 4.36 – 5.83 6.25 4.20 – 6.50 Fair value $10.01 – $17.66 $9.91 – $18.05 $15.54 – $41.79 $12.66 – $33.62 $31.33 – $49.14 $16.12 – $41.72 |
Summary of the weighted average fair value of stock options granted, the total intrinsic value of stock options exercised and the fair value of options vested | The following table summarizes the weighted average grant date fair value of stock options granted per share, the total intrinsic value of stock options exercised and the grant date fair value of stock options vested during the years ended December 31: (in thousands, except per share amounts) 2015 2014 2013 Weighted average grant date fair value of stock options granted per share $ 13.20 $ 26.92 $ 32.59 Intrinsic value of stock options exercised 1,998 10,250 40,761 Grant date fair value of stock options that vested during the period 1,616 2,641 3,156 |
Summary of the activity of the entity's stock options | The following table summarizes the activity related to our stock options: Number of options Weighted average exercise price Weighted average contractual term (in years ) Aggregate intrinsic value ( in thousands) Outstanding at December 31, 2014 2,601,892 $ 21.21 4.44 $ 47,805 Granted 853,510 24.21 Exercised (130,682 ) 10.64 Forfeited (161,595 ) 66.72 Outstanding at December 31, 2015 3,163,125 20.13 4.94 35,842 Exercisable at December 31, 2015 2,214,051 14.43 3.12 32,395 |
Schedule of Share-based Compensation, Shares Authorized under Stock Option Plans, by Exercise Price Range [Table Text Block] | The following table summarizes information about stock options outstanding and exercisable at December 31, 2015 : Options outstanding Options exercisable Exercise price range Number Weighted average remaining contractual life (in years ) Weighted average exercise price Number Weighted average remaining contractual life (in years ) Weighted average exercise price Up to $10.00 (a) 1,575,003 2.54 $ 9.14 1,575,003 2.54 $ 9.14 $10.01 — $20.00 (a) 427,781 8.44 18.23 64,729 3.66 15.08 $20.01 — $30.00 (a) 881,711 6.73 25.68 470,311 4.32 23.21 $30.01 — $40.00 (a) 63,880 7.02 32.26 39,880 5.43 33.05 $40.01 — $50.00 (a) 5,000 8.94 49.06 313 8.94 49.06 $60.01 — $70.00 (a) 71,000 6.19 60.73 46,469 6.19 60.74 $70.01 — $80.00 (a) 25,000 8.87 72.78 1,563 8.87 72.78 $80.01 — $90.00 (a) 40,000 8.04 85.63 9,063 7.37 84.35 $90.01 — $100.00 (a) 71,875 8.33 94.31 6,251 8.01 94.26 $100.01 — $110.00 (a) 1,875 8.37 105.11 469 8.37 105.11 3,163,125 2,214,051 (a) These options contain market-based components as described above. |
Schedule of Share Based Compensation Shares Authorized under Stock Option Plans by Vesting Price Range [Table Text Block] | The following table summarizes the market prices necessary in order for the market performance options to begin to vest: Market-based options Vesting price Ordinary performance Extraordinary performance $170.01 — $180.00 12,500 — $180.01 — $190.00 12,500 25,875 Over $190.00 22,500 30,000 Total 47,500 55,875 Weighted average share price $ 92.29 $ 77.03 |
Schedule of Share-based Compensation, Restricted Stock and Restricted Stock Units Activity [Table Text Block] | The following table summarizes the activity related to our restricted shares: Number of Outstanding at December 31, 2014 26,224 Granted 251,938 Issued (2,836 ) Forfeited (3,000 ) Outstanding at December 31, 2015 272,326 |
Schedule of Share-based Compensation, Stock Options and Stock Appreciation Rights Award Activity [Table Text Block] | The following table summarizes the activity related to our EARs (expressed as a percentage of each of the divisions): Consumer Analytics Document Solutions Marketplace Solutions Outstanding at December 31, 2014 — — — Granted 5.6 % 5.8 % 5.3 % Forfeited — (0.2 ) — Outstanding at December 31, 2015 5.6 % 5.6 % 5.3 % |
REVENUE COST OF REVENUE (Tables
REVENUE COST OF REVENUE (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Revenues [Abstract] | |
Schedule of revenue [Table Text Block] | The components of revenue were as follows for the years ended December 31: (in thousands) 2015 2014 2013 Service revenue $ 940,920 $ 938,679 $ 662,059 Reimbursable expenses 107,344 137,634 102,478 Non-controlling interests 3,202 2,603 3,820 Total $ 1,051,466 $ 1,078,916 $ 768,357 |
COST OF REVENUE (Tables)
COST OF REVENUE (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Cost of Revenue [Abstract] | |
Schedule of components of cost of revenue | The components of cost of revenue were as follows for the years ended December 31: (in thousands) 2015 2014 2013 Compensation and benefits $ 261,839 $ 255,889 $ 156,812 Outside fees and services 248,278 243,325 193,233 Reimbursable expenses 107,344 137,634 102,478 Technology and telecommunications 43,177 48,834 25,534 Depreciation and amortization 26,689 21,498 14,423 Total $ 687,327 $ 707,180 $ 492,480 |
SELLING, GENERAL AND ADMINIST49
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Selling, General and Administrative Expense [Abstract] | |
Schedule of the components of selling, general and administrative expenses | The components of selling, general and administrative expenses were as follows for the years ended December 31: (in thousands) 2015 2014 2013 Compensation and benefits $ 54,897 $ 45,098 $ 27,864 Professional services 23,183 18,598 8,022 Occupancy related costs 39,917 38,262 28,424 Amortization of intangible assets 41,135 37,680 28,176 Depreciation and amortization 9,781 7,548 4,633 Marketing costs 27,499 24,130 5,028 Other 24,456 30,417 11,663 Total $ 220,868 $ 201,733 $ 113,810 |
LOSS ON SALE OF HLSS EQUITY SEC
LOSS ON SALE OF HLSS EQUITY SECURITIES, NET OF DIVIDENDS RECEIVED (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
LOSS ON SALE OF HLSS EQUITY SECURITIES, NET OF DIVIDENDS RECEIVED [Abstract] | |
Schedule of Available-for-sale Securities Reconciliation [Table Text Block] | LOSS ON SALE OF HLSS EQUITY SECURITIES, NET OF DIVIDENDS RECEIVED During March 2015, we purchased 1.6 million shares of HLSS common stock in the open market for $30.0 million . This investment was classified as available for sale. On April 6, 2015, HLSS completed the sale of substantially all of its assets to New Residential Investment Corp. (“NRZ”) and adopted a plan of complete liquidation and dissolution. During April 2015, we received liquidating dividends and other dividends from HLSS totaling $20.4 million and we sold all of our 1.6 million shares of HLSS common stock in the open market for $7.7 million . As a result of these transactions, we recognized a net loss of $1.9 million for the year ended December 31, 2015 (no comparative amounts for 2014 and 2013 ) in connection with our investment in HLSS. |
OTHER INCOME (EXPENSE), NET (Ta
OTHER INCOME (EXPENSE), NET (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Other Income and Expenses [Abstract] | |
Schedule of other income (expense), net | Other income (expense), net consists of the following for the years ended December 31: (in thousands) 2015 2014 2013 Gain on early extinguishment of debt $ 3,836 $ — $ — Loss in equity affiliate, including impairment loss — — (176 ) Interest income 133 103 899 Other, net 76 71 (166 ) Total $ 4,045 $ 174 $ 557 |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Income Tax Disclosure [Abstract] | |
Schedule of Income before Income Tax, Domestic and Foreign | The components of income before income taxes and non-controlling interests consist of the following for the years ended December 31: (in thousands) 2015 2014 2013 Domestic - Luxembourg $ 27,884 $ 124,181 $ 122,722 Foreign - U.S. 5,944 9,575 11,125 Foreign - Non-U.S. 19,232 13,509 8,486 Total $ 53,060 $ 147,265 $ 142,333 |
Schedule of income tax provision | The income tax provision consists of the following for the years ended December 31: (in thousands) 2015 2014 2013 Current: Domestic - Luxembourg $ 1,787 $ 4,415 $ 2,516 Foreign - U.S. Federal 539 75 6 Foreign - U.S. State 855 476 403 Foreign - Non-U.S. 6,405 4,046 3,600 $ 9,586 $ 9,012 $ 6,525 Deferred: Foreign - U.S. Federal $ (108 ) $ 1,756 $ 2,506 Foreign - U.S. State (526 ) (281 ) 84 Foreign - Non-U.S. (692 ) (309 ) (575 ) $ (1,326 ) $ 1,166 $ 2,015 Total $ 8,260 $ 10,178 $ 8,540 |
Summary of tax effects of the temporary differences | A summary of the tax effects of the temporary differences is as follows for the years ended December 31: (in thousands) 2015 2014 Current deferred tax assets: Allowance for doubtful accounts and other reserves $ — $ 72 Accrued expenses — 5,165 Current deferred tax liabilities: Prepaid expenses — (250 ) Current deferred tax assets, net $ — $ 4,987 Non-current deferred tax assets: Net operating loss carryforwards $ 5,417 $ 13,940 U.S. federal and state tax credits 2,577 1,202 Non-U.S. deferred tax assets 2,472 1,780 Share-based compensation 1,750 856 Accrued expenses 7,730 — Non-current deferred tax liabilities: Intangible assets (4,508 ) (5,302 ) Depreciation (7,446 ) (11,878 ) Other (815 ) (177 ) 7,177 421 Valuation allowance (3,558 ) (3,115 ) Non-current deferred tax assets, net $ 3,619 $ — Non-current deferred tax liabilities, net $ — $ (2,694 ) Net deferred tax assets $ 3,619 $ 2,293 |
Schedule of the reconciliation of income tax provision to the Luxembourg statutory income tax rate | The following table reconciles the Luxembourg statutory tax rate to our effective tax rate for the years ended December 31: 2015 2014 2013 Statutory tax rate 29.22 % 29.22 % 29.22 % Permanent difference related to Luxembourg intangible assets (13.56 ) (22.60 ) (23.59 ) Change in valuation allowance 0.83 (0.05 ) 0.76 State tax expense 0.29 0.03 0.24 Tax credits (2.34 ) (0.71 ) — Uncertain taxes 1.39 0.88 — Other (0.26 ) 0.14 (0.63 ) Effective tax rate 15.57 % 6.91 % 6.00 % |
Summary of Income Tax Contingencies | The following table reconciles the amount of unrecognized tax benefits for the years ended December 31: (in thousands) 2015 2014 Amount of unrecognized tax benefits as of the beginning of the year $ 1,153 $ — Increases as a result of tax positions taken in a prior period 638 1,153 Increases as a result of tax positions taken in the current period 214 — Amount of unrecognized tax benefits as of the end of the year $ 2,005 $ 1,153 |
EARNINGS PER SHARE (Tables)
EARNINGS PER SHARE (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Earnings Per Share [Abstract] | |
Schedule of basic and diluted EPS calculation | Basic and diluted EPS are calculated as follows for the years ended December 31: (in thousands, except per share data) 2015 2014 2013 Net income attributable to Altisource $ 41,598 $ 134,484 $ 129,973 Weighted average common shares outstanding, basic 19,504 21,625 23,072 Dilutive effect of stock options and restricted shares 1,115 2,009 1,981 Weighted average common shares outstanding, diluted 20,619 23,634 25,053 Earnings per share: Basic $ 2.13 $ 6.22 $ 5.63 Diluted $ 2.02 $ 5.69 $ 5.19 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of future minimum lease payments under non-cancelable capital and operating leases with an original term exceeding one year | Future minimum lease payments at December 31, 2015 under non-cancelable operating leases with an original term exceeding one year are as follows: (in thousands) Operating lease obligations 2016 $ 17,308 2017 15,085 2018 10,983 2019 7,451 2020 3,654 Thereafter 4,860 $ 59,341 |
SEGMENT REPORTING (Tables)
SEGMENT REPORTING (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Segment Reporting [Abstract] | |
Schedule of financial information of segments | Financial information for our segments is as follows: For the year ended December 31, 2015 (in thousands) Mortgage Financial Technology Corporate Consolidated Revenue $ 786,648 $ 88,448 $ 215,482 $ (39,112 ) $ 1,051,466 Cost of revenue 474,169 60,806 187,835 (35,483 ) 687,327 Gross profit (loss) 312,479 27,642 27,647 (3,629 ) 364,139 Selling, general and administrative expenses 105,153 18,707 29,902 67,106 220,868 Impairment losses — — 71,785 — 71,785 Change in the fair value of Equator earn out liability — — (7,591 ) — (7,591 ) Income (loss) from operations 207,326 8,935 (66,449 ) (70,735 ) 79,077 Other income (expense), net 506 58 61 (26,642 ) (26,017 ) Income (loss) before income taxes and non-controlling interests $ 207,832 $ 8,993 $ (66,388 ) $ (97,377 ) $ 53,060 For the year ended December 31, 2014 (in thousands) Mortgage Financial Technology Corporate Consolidated Revenue $ 793,143 $ 98,499 $ 227,300 $ (40,026 ) $ 1,078,916 Cost of revenue 486,387 64,338 192,426 (35,971 ) 707,180 Gross profit (loss) 306,756 34,161 34,874 (4,055 ) 371,736 Selling, general and administrative expenses 94,686 18,791 32,393 55,863 201,733 Impairment losses — — 37,473 — 37,473 Change in the fair value of Equator earn out liability — — (37,924 ) — (37,924 ) Income (loss) from operations 212,070 15,370 2,932 (59,918 ) 170,454 Other income (expense), net 204 62 (31 ) (23,424 ) (23,189 ) Income (loss) before income taxes and non-controlling interests $ 212,274 $ 15,432 $ 2,901 $ (83,342 ) $ 147,265 For the year ended December 31, 2013 (in thousands) Mortgage Financial Technology Corporate Consolidated Revenue $ 599,319 $ 92,958 $ 100,724 $ (24,644 ) $ 768,357 Cost of revenue 376,639 55,328 82,612 (22,099 ) 492,480 Gross profit (loss) 222,680 37,630 18,112 (2,545 ) 275,877 Selling, general and administrative expenses 46,522 15,571 12,435 39,282 113,810 Income (loss) from operations 176,158 22,059 5,677 (41,827 ) 162,067 Other income (expense), net (136 ) (10 ) 7 (19,595 ) (19,734 ) Income (loss) before income taxes and non-controlling interests $ 176,022 $ 22,049 $ 5,684 $ (61,422 ) $ 142,333 (in thousands) Mortgage Services Financial Services Technology Services Corporate Eliminations Consolidated Altisource Total assets: December 31, 2015 $ 325,461 $ 53,757 $ 165,778 $ 182,986 $ 727,982 December 31, 2014 313,550 56,096 250,059 168,516 788,221 |
Schedule of premises and equipment, net by country | Our services are provided to customers primarily located in the United States. Premises and equipment, net consist of the following, by country: (in thousands) December 31, December 31, United States $ 85,021 $ 88,274 India 21,187 27,082 Luxembourg 9,944 9,059 Philippines 2,664 3,344 Uruguay 305 — Total $ 119,121 $ 127,759 |
QUARTERLY FINANCIAL DATA (UNA56
QUARTERLY FINANCIAL DATA (UNAUDITED) (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Quarterly Financial Information Disclosure [Abstract] | |
Schedule of unaudited quarterly results | The following tables contain selected unaudited statement of operations information for each quarter of 2015 and 2014 . The following information reflects all normal recurring adjustments necessary for a fair presentation of the information for the periods presented. The operating results for any quarter are not necessarily indicative of results for any future period. Our business is affected by seasonality. 2015 quarter ended (1)(2)(3)(4) (in thousands, except per share data) March 31, June 30, September 30, December 31, Revenue $ 240,482 $ 268,321 $ 272,776 $ 269,887 Gross profit 67,656 100,162 98,926 97,395 Income (loss) before income taxes and non-controlling interests 4,808 51,244 41,200 (44,192 ) Net income (loss) 4,408 46,846 37,897 (44,351 ) Net income (loss) attributable to Altisource 3,698 45,950 37,046 (45,096 ) Earnings (loss) per share: Basic $ 0.18 $ 2.35 $ 1.94 $ (2.35 ) Diluted $ 0.18 $ 2.22 $ 1.82 $ (2.35 ) Weighted average shares outstanding: Basic 20,172 19,571 19,091 19,196 Diluted 20,995 20,669 20,411 19,196 2014 quarter ended (1)(5) (in thousands, except per share data) March 31, June 30, September 30, December 31, Revenue $ 239,269 $ 296,072 $ 287,688 $ 255,887 Gross profit 91,464 112,073 98,964 69,235 Income (loss) before income taxes and non-controlling interests 43,201 58,225 45,867 (28 ) Net income (loss) 40,146 54,732 43,115 (906 ) Net income (loss) attributable to Altisource 39,631 54,101 42,287 (1,535 ) Earnings (loss) per share: Basic $ 1.76 $ 2.45 $ 1.96 $ (0.08 ) Diluted $ 1.61 $ 2.24 $ 1.79 $ (0.08 ) Weighted average shares outstanding: Basic 22,509 22,089 21,626 20,306 Diluted 24,662 24,166 23,640 20,306 ___________________________________________________ (1) The sum of quarterly amounts, including per share amounts, may not equal amounts reported for year-to-date periods. This is due to the effects of rounding and changes in the number of weighted average shares outstanding for each period. (2) We acquired CastleLine on July 17, 2015 and the Acquired RentRange and Investability Businesses on October 9, 2015 (see Note 5 ). (3) During the fourth quarter of 2015, Altisource recorded an estimated loss in connection with an anticipated payment to Ocwen for obtaining a release of liability for Altisource related to Ocwen’s settlement of a particular case. While currently being negotiated, the ultimate resolution of the matter is not expected to result in a material loss in excess of the amount accrued. (4) In the fourth quarter of 2015, we recorded impairment losses of $71.8 million in our Technology Services segment primarily driven by the Company’s current projected Technology Services revenue from Ocwen and investment in technologies provided to Ocwen (see Notes 9 and 10). (5) We acquired Mortgage Builder on September 12, 2014 and Owners on November 21, 2014 (see Note 5 ). |
ORGANIZATION (Details)
ORGANIZATION (Details) | 12 Months Ended |
Dec. 31, 2015segment | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Number of reporting segments | 3 |
BASIS OF PRESENTATION AND SUM58
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Summary of significant accounting policies | |||
Assets, Noncurrent | $ 421,900,000 | ||
Other Assets, Noncurrent | 19,337,000 | $ 22,267,000 | |
Long-term Debt | 534,362,000 | 588,614,000 | |
Debt issuance costs, net | 6,184,000 | 8,099,000 | |
Goodwill | |||
Goodwill impairment | 55,740,000 | 37,473,000 | |
Intangible Assets, Net | |||
Impairment of intangible assets | 11,900,000 | $ 0 | |
Defined Contribution 401(k) Plan | |||
Expense recorded for discretionary amounts contributed | 1,000,000 | 900,000 | 400,000 |
Revenue Recognition | |||
Reimbursable expenses | 107,344,000 | 137,634,000 | 102,478,000 |
Technology Services | |||
Goodwill | |||
Goodwill impairment | 55,740,000 | 37,473,000 | 0 |
Mortgage Services | |||
Goodwill | |||
Goodwill impairment | 0 | 0 | |
Revenue Recognition | |||
Reimbursable expenses | $ 107,200,000 | 137,400,000 | $ 102,000,000 |
Minimum | |||
Intangible Assets, Net | |||
Finite-Lived Intangible Asset, Useful Life | 4 years | ||
Maximum | |||
Intangible Assets, Net | |||
Finite-Lived Intangible Asset, Useful Life | 20 years | ||
Furniture and fixtures | |||
Premises and Equipment, Net | |||
Estimated useful lives | 5 years | ||
Office equipment | |||
Premises and Equipment, Net | |||
Estimated useful lives | 5 years | ||
Computer hardware | |||
Premises and Equipment, Net | |||
Estimated useful lives | 5 years | ||
Computer software | Minimum | |||
Premises and Equipment, Net | |||
Estimated useful lives | 3 years | ||
Computer software | Maximum | |||
Premises and Equipment, Net | |||
Estimated useful lives | 7 years | ||
Leasehold improvements | Maximum | |||
Premises and Equipment, Net | |||
Estimated useful lives | 10 years | ||
Lenders One | Mortgage Partnership of America LLC [Member] | |||
Principles of Consolidation | |||
Total assets | $ 4,900,000 | 7,700,000 | |
Total liabilities | 3,700,000 | 6,700,000 | |
Lenders One | Best Partners Mortgage Brokers Cooperative, Inc. [Member] | |||
Principles of Consolidation | |||
Total assets | 40,000 | 0 | |
Total liabilities | 41,000 | 0 | |
Lenders One | Best Partners Residential Investor Cooperative, Inc. [Member] | |||
Principles of Consolidation | |||
Total assets | 2,000 | 0 | |
Total liabilities | $ 3,000 | $ 0 |
CUSTOMER CONENTRATION (Details)
CUSTOMER CONENTRATION (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Concentration Risk(2014 Values with Related Party Entity) | |||
Revenue | $ 666,800 | $ 502,087 | |
Other Portfolio Servicing Revenue | $ 216,900 | 256,000 | 161,900 |
Ocwen | |||
Concentration Risk(2014 Values with Related Party Entity) | |||
Revenue | $ 650,700 | $ 499,300 | |
Concentration Risk, Revenue | 631,600 | ||
Accounts Receivable, Related Parties, Current | 38,200 | ||
Ocwen | Billed Revenues | |||
Concentration Risk(2014 Values with Related Party Entity) | |||
Accounts Receivable, Related Parties, Current | 20,400 | ||
Ocwen | Unbilled Revenues | |||
Concentration Risk(2014 Values with Related Party Entity) | |||
Accounts Receivable, Related Parties, Current | $ 17,800 | ||
Revenue from Rights Concentration Risk [Member] | Sales Revenue, Segment [Member] | Ocwen | |||
Concentration Risk(2014 Values with Related Party Entity) | |||
Concentration Risk, Percentage | 60.00% | 60.00% | 65.00% |
Revenue from Rights Concentration Risk [Member] | Sales Revenue, Segment [Member] | Mortgage Services | Ocwen | |||
Concentration Risk(2014 Values with Related Party Entity) | |||
Concentration Risk, Percentage | 63.00% | 67.00% | 70.00% |
Revenue from Rights Concentration Risk [Member] | Sales Revenue, Segment [Member] | Financial Services | Ocwen | |||
Concentration Risk(2014 Values with Related Party Entity) | |||
Concentration Risk, Percentage | 21.00% | 27.00% | 30.00% |
Revenue from Rights Concentration Risk [Member] | Sales Revenue, Segment [Member] | Technology Services | Ocwen | |||
Concentration Risk(2014 Values with Related Party Entity) | |||
Concentration Risk, Percentage | 54.00% | 42.00% | 50.00% |
TRANSACTIONS WITH RELATED PAR60
TRANSACTIONS WITH RELATED PARTIES (Details) - USD ($) | Mar. 31, 2013 | Dec. 27, 2012 | Jan. 16, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2015 |
TRANSACTIONS WITH RELATED PARTIES | ||||||
Revenue from related party | $ 666,800,000 | $ 502,087,000 | ||||
Cost of revenue | 38,610,000 | 19,983,000 | ||||
Accounts payable and accrued expenses | 111,766,000 | $ 91,871,000 | ||||
Ocwen | ||||||
TRANSACTIONS WITH RELATED PARTIES | ||||||
Revenue from related party | $ 22,900,000 | |||||
Receivable from related party | 37,400,000 | |||||
Accounts payable and accrued expenses | 11,600,000 | |||||
Ocwen | Correspondent One | ||||||
TRANSACTIONS WITH RELATED PARTIES | ||||||
Percentage of equity interest sold to the related party | 49.00% | |||||
Proceeds from sale of equity interest | $ 12,600,000 | |||||
Ocwen | Senior unsecured term loan | ||||||
TRANSACTIONS WITH RELATED PARTIES | ||||||
Amount of loan provided to related party | $ 75,000,000 | |||||
Interest income | 0 | 800,000 | ||||
Ocwen | Senior unsecured term loan | Eurodollar Rate | ||||||
TRANSACTIONS WITH RELATED PARTIES | ||||||
Reference rate | Eurodollar Rate | |||||
Interest rate margin (as a percent) | 6.75% | |||||
Interest rate, variable interest rate floor (as a percent) | 1.50% | |||||
Ocwen | Data Access and Services Agreement | ||||||
TRANSACTIONS WITH RELATED PARTIES | ||||||
Cost of revenue | 1,900,000 | 38,600,000 | 20,000,000 | |||
Ocwen | Support Services Agreement | ||||||
TRANSACTIONS WITH RELATED PARTIES | ||||||
Selling, general and administrative expenses billed to related party | (100,000) | (4,500,000) | (2,800,000) | |||
Selling, general and administrative expenses billed by related party | 300,000 | 6,100,000 | 4,600,000 | |||
Ocwen | Unbilled Revenues | ||||||
TRANSACTIONS WITH RELATED PARTIES | ||||||
Receivable from related party | 14,600,000 | |||||
Ocwen | Billed Revenues | ||||||
TRANSACTIONS WITH RELATED PARTIES | ||||||
Receivable from related party | 22,800,000 | |||||
Correspondent One | Support Services Agreement | ||||||
TRANSACTIONS WITH RELATED PARTIES | ||||||
Revenue from related party | 0 | 79,000 | ||||
Selling, general and administrative expenses billed to related party | 0 | 69,000 | ||||
HLSS | Support Services Agreement | ||||||
TRANSACTIONS WITH RELATED PARTIES | ||||||
Selling, general and administrative expenses billed to related party | (900,000) | (700,000) | ||||
HLSS | Billed Revenues | ||||||
TRANSACTIONS WITH RELATED PARTIES | ||||||
Receivable from related party | 100,000 | |||||
Residential | Management, Support and Other Services Agreements | ||||||
TRANSACTIONS WITH RELATED PARTIES | ||||||
Revenue from related party | $ 1,000,000 | 16,000,000 | 2,600,000 | |||
Residential | Billed Revenues | ||||||
TRANSACTIONS WITH RELATED PARTIES | ||||||
Receivable from related party | 11,300,000 | |||||
AAMC | Support Services Agreement | ||||||
TRANSACTIONS WITH RELATED PARTIES | ||||||
Selling, general and administrative expenses billed to related party | (900,000) | (500,000) | ||||
Related Party Transaction Provided to Related Party Amounts Billed - Total | 1,000,000 | 500,000 | ||||
AAMC | Support and Other Services Agreements | ||||||
TRANSACTIONS WITH RELATED PARTIES | ||||||
Revenue from related party | 100,000 | $ 100,000 | ||||
AAMC | Billed Revenues | ||||||
TRANSACTIONS WITH RELATED PARTIES | ||||||
Receivable from related party | $ 100,000 |
ACQUISITIONS - RentRange, Inves
ACQUISITIONS - RentRange, Investability and Onit Solutions (Details) - USD ($) shares in Thousands, $ in Thousands | Oct. 09, 2015 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 |
Acquisitions | ||||
Value of common stock paid at acquisition | $ 21,733 | $ 0 | $ 0 | |
Goodwill | $ 82,801 | $ 90,851 | $ 99,414 | |
RentRange, Investability and Onit Solutions [Member] | ||||
Acquisitions | ||||
Amount paid | $ 24,800 | |||
Cash paid at acquisition | $ 17,500 | |||
Number of shares exchanged for acquisition | 247 | |||
Value of common stock paid at acquisition | $ 7,300 | |||
Business Combination, Contingent Consideration Arrangements, Payment Period | 4 years | |||
Cash | $ 3 | |||
Accounts receivable, net | 245 | |||
Premises and equipment, net | 1,206 | |||
Prepaid expenses and Other assets | 199 | |||
Software | 1,265 | |||
Trademark and Trade Names | 1,205 | |||
Database/Others | 910 | |||
Non-Compete Agreements | 330 | |||
Customer relationship | 255 | |||
Goodwill | 19,565 | |||
Assets acquired | 25,183 | |||
Accounts payable and accrued expenses | (391) | |||
Purchase price | $ 24,792 |
ACQUISITIONS - CastleLine (Deta
ACQUISITIONS - CastleLine (Details) - USD ($) shares in Thousands, $ in Thousands | Jul. 17, 2015 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 |
Acquisitions | ||||
Value of common stock paid at acquisition | $ 21,733 | $ 0 | $ 0 | |
Goodwill | $ 82,801 | $ 90,851 | $ 99,414 | |
CastleLine | ||||
Acquisitions | ||||
Cash paid at acquisition | $ 12,300 | |||
Accounts Payable | $ 10,500 | |||
Business Combination, Contingent Consideration Arrangements, Payment Period | 4 years | |||
Number of shares exchanged for acquisition | 495 | |||
Value of common stock paid at acquisition | $ 14,400 | |||
Additional consideration | 3,800 | |||
Cash | 1,088 | |||
Accounts receivable, net | 510 | |||
Prepaid expenses and Other assets | 66 | |||
Restricted Cash | 2,501 | |||
Non-Compete Agreements | 1,105 | |||
Database/Others | 465 | |||
Customer relationship | 395 | |||
Trademark and Trade Names | 150 | |||
Goodwill | 28,125 | |||
Assets acquired | 34,405 | |||
Accounts payable and accrued expenses | (875) | |||
Deferred Revenue | (87) | |||
Purchase price | $ 33,443 |
ACQUISITIONS - Owners.com (Det
ACQUISITIONS - Owners.com (Details) - USD ($) $ in Thousands | Nov. 21, 2014 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 |
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Less Noncontrolling Interest [Abstract] | ||||
Goodwill | $ 82,801 | $ 90,851 | $ 99,414 | |
Owners.com | ||||
Acquisitions | ||||
Amount paid | $ 19,800 | |||
Additional consideration | 7,000 | |||
Present value of future earn outs payments | 1,900 | |||
Payment made to the seller - adjustment | $ 100 | |||
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Less Noncontrolling Interest [Abstract] | ||||
Accounts receivable, net | 32 | |||
Prepaid expenses and Other assets | 28 | |||
Software | 501 | |||
Trademark and Trade Names | 1,431 | |||
Goodwill | 19,775 | |||
Assets acquired | 21,767 | |||
Accounts payable and accrued expenses | (22) | |||
Purchase price | $ 21,745 |
ACQUISITIONS - Mortgage Builder
ACQUISITIONS - Mortgage Builder (Details) - USD ($) $ in Thousands | Jul. 17, 2015 | Sep. 12, 2014 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 |
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Less Noncontrolling Interest [Abstract] | |||||
Goodwill | $ 82,801 | $ 90,851 | $ 99,414 | ||
Mortgage Builder | |||||
Acquisitions | |||||
Amount paid | $ 15,700 | ||||
Additional consideration | 7,000 | ||||
Business Combination, Contingent Consideration Arrangements, Payment Period | 3 years | ||||
Present value of future earn outs payments | 1,600 | ||||
Payment received from the seller - Adjustment | $ 200 | ||||
Business Combination, Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed, Less Noncontrolling Interest [Abstract] | |||||
Cash | 668 | ||||
Accounts receivable, net | 1,102 | ||||
Prepaid expenses and Other assets | 38 | ||||
Premises and equipment, net | 553 | ||||
Software | 1,509 | ||||
Trademark and Trade Names | 209 | ||||
Customer relationship | 4,824 | ||||
Goodwill | 9,135 | ||||
Assets acquired | 18,038 | ||||
Accounts payable and accrued expenses | 950 | ||||
Purchase price | $ 17,088 |
ACQUISITIONS - Equator Acquisit
ACQUISITIONS - Equator Acquisition (Details) | Nov. 15, 2013USD ($) | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | Dec. 31, 2013USD ($) |
Estimated life | ||||
Change in the fair value of acquisition related contingent consideration | $ (7,184,000) | $ (37,924,000) | $ 0 | |
Goodwill impairment | 55,740,000 | 37,473,000 | ||
Goodwill | 82,801,000 | 90,851,000 | 99,414,000 | |
Business Combination, Contingent Consideration Arrangement - Equator | $ (7,591,000) | (37,924,000) | $ 0 | |
Minimum | ||||
Estimated life | ||||
Customer relationship | 4 years | |||
Maximum | ||||
Estimated life | ||||
Customer relationship | 20 years | |||
Equator LLC | ||||
Acquisitions | ||||
Amount paid | $ 63,400,000 | |||
Business Combination, Contingent Consideration, Asset, Current | $ 3,700,000 | |||
Payment made to extinguish Equator contingent consideration | $ 500,000 | |||
Number of consecutive 12-month periods for meeting targeted levels of adjusted EBITA | 3 | |||
Number of months for each consecutive period for meeting targeted levels of adjusted EBITA | 12 months | |||
Present value of future earn outs payments | $ 46,000,000 | |||
Estimated life | ||||
Goodwill impairment | 37,500,000 | |||
Value of Equator contingent consideration after payment to sellers | $ 0 | |||
Accounts receivable, net | 9,293,000 | 12,783,000 | ||
Adjustment Accounts Receivable | 3,490,000 | |||
Prepaid expenses and Other assets | 954,000 | 561,000 | ||
Business Combination, Adjustment Prepaid expenses and other current assets | (393,000) | |||
Premises and equipment, net | 16,974,000 | 16,974,000 | ||
Business Combination, Adjustment Premises and equipment | 0 | |||
Intangible Assets, Other than Goodwill | 43,393,000 | 43,393,000 | ||
Business Combination, Adjustment Other than Goodwill | 0 | |||
Goodwill | 82,460,000 | 82,460,000 | ||
Business Combination, Adjustment Goodwill | 0 | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Other Noncurrent Assets | 242,000 | 320,000 | ||
Business Combination, Adjustment Other non-current assets | 78,000 | |||
Assets acquired | 153,316,000 | 156,491,000 | ||
Business Combination, Adjustments, Total Assets acquired | 3,175,000 | |||
Accounts payable and accrued expenses | (7,232,000) | (6,696,000) | ||
Adjustment Accounts payable and accrued expenses | 536,000 | |||
Deferred Revenue | (36,689,000) | (36,689,000) | ||
Business Combination, Adjustment Deferred revenue | 0 | |||
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Liabilities | (43,921,000) | (43,385,000) | ||
Total Liabilities Assumed | (536,000) | |||
Purchase price | 109,395,000 | 113,106,000 | ||
Business Combination, Adjustment, Assets Goodwill and Liabilities Net | $ 3,711,000 | |||
Equator LLC | Maximum | ||||
Acquisitions | ||||
Additional consideration | 80,000,000 | |||
Earn Out consideration that can be earned in each of the first two 12-month periods | 22,500,000 | |||
Earn Out consideration that can be earned in the third 12-month period | $ 35,000,000 | |||
Additional consideration that can be paid in restricted stock shares (as a percent) | 20.00% | |||
Customer Relationships | Equator LLC | ||||
Estimated life | ||||
Customer relationship | 15 years | |||
Trade Names | Equator LLC | ||||
Estimated life | ||||
Estimated useful lives | 4 years | |||
Software Development | Equator LLC | ||||
Estimated life | ||||
Estimated useful lives | 7 years | |||
Premises and Equipment Excluding Internally Developed Software | Equator LLC | Minimum | ||||
Estimated life | ||||
Estimated useful lives | 3 years | |||
Premises and Equipment Excluding Internally Developed Software | Equator LLC | Maximum | ||||
Estimated life | ||||
Estimated useful lives | 5 years |
ACQUISITIONS ResCap Fee-Based B
ACQUISITIONS ResCap Fee-Based Businesses (Details) - Ocwen [Member] - Residential Capital LLC Mortgage Servicing Platform Assets [Member] $ in Thousands | Apr. 12, 2013USD ($) |
Acquisitions | |
Amount paid | $ 128,800 |
Business Combination Recognized Identifiable Assets Acquired and Liabilities Assumed Tangible Assets | 0 |
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Liabilities | 0 |
Intangible Assets, Other than Goodwill | $ 128,800 |
Customer relationship | 7 years |
ACQUISITIONS Homeward Fee-Based
ACQUISITIONS Homeward Fee-Based Businesses (Details) - USD ($) $ in Thousands | Mar. 29, 2013 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 |
Acquisitions | ||||
Goodwill | $ 82,801 | $ 90,851 | $ 99,414 | |
Ocwen [Member] | Homeward Servicing Portfolio | ||||
Acquisitions | ||||
Amount paid | $ 75,800 | |||
Business Acquisition Working Capital and Net Income Adjustment | 11,100 | |||
Business Acquisition, Property, Plant and Equipment Allocation Adjustment | 1,200 | |||
Business Combination Provisional Information Initial Accounting Incomplete Adjustment Accounts Payable and Accrued Expenses | 2,000 | |||
Premises and equipment, net | 1,559 | |||
Customer relationship | 75,609 | |||
Goodwill | 2,039 | |||
Assets acquired | 79,207 | |||
Accounts payable and accrued expenses | 3,390 | |||
Purchase price | $ 75,817 | |||
Minimum | ||||
Acquisitions | ||||
Customer relationship | 4 years | |||
Maximum | ||||
Acquisitions | ||||
Customer relationship | 20 years | |||
Ocwen [Member] | Minimum | Homeward Servicing Portfolio | ||||
Acquisitions | ||||
Property, Plant and Equipment, Useful Life | 3 years | |||
Ocwen [Member] | Maximum | Homeward Servicing Portfolio | ||||
Acquisitions | ||||
Property, Plant and Equipment, Useful Life | 5 years | |||
Ocwen [Member] | Customer Relationships | Homeward Servicing Portfolio | ||||
Acquisitions | ||||
Customer relationship | 7 years |
ACQUISITIONS Acquisitions - Pro
ACQUISITIONS Acquisitions - Pro Forma Results (Details) $ / shares in Units, $ in Thousands | 12 Months Ended |
Dec. 31, 2013USD ($)$ / shares | |
Business Acquisition, Pro Forma Information [Abstract] | |
Revenue as Reported | $ 768,357 |
Revenue, Pro Forma | 854,098 |
Net Income attributable to Altisource, As reported | 129,973 |
Net Income attributable to Altisource, Pro forma | $ 132,907 |
Earnings Per Share - Diluted (in dollars per share), As Reported | $ / shares | $ 5.19 |
Earnings Per Share - Diluted (in dollars per share), Pro forma | $ / shares | $ 5.31 |
FAIR VALUE (Details)
FAIR VALUE (Details) - USD ($) | 12 Months Ended | |||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Acquisitions | ||||
Impairment of Long-Lived Assets Held-for-use | $ 4,100,000 | $ 0 | $ 0 | |
Business Combination, Contingent Consideration Arrangement - Equator | (7,591,000) | (37,924,000) | 0 | |
Goodwill impairment | 55,740,000 | 37,473,000 | ||
Impairment of intangible assets | 11,900,000 | 0 | ||
Cash and cash equivalents | 179,327,000 | 161,361,000 | $ 130,324,000 | $ 105,502,000 |
Restricted cash | 4,801,000 | 3,022,000 | ||
Equator LLC | ||||
Acquisitions | ||||
Payment made to extinguish Equator contingent consideration | 500,000 | |||
Value of Equator contingent consideration after payment to sellers | 0 | |||
Goodwill impairment | 37,500,000 | |||
Fair value measurements | ||||
Acquisitions | ||||
Fair values of the liabilities for acquisition-related contingent consideration | 3,900,000 | 11,600,000 | ||
Long-term Debt, Gross | 536,598,000 | 591,543,000 | ||
Fair Value, Inputs, Level 1 [Member] | Fair value measurements | ||||
Acquisitions | ||||
Cash and cash equivalents | 179,327,000 | 161,361,000 | ||
Restricted cash | 4,801,000 | 3,022,000 | ||
Long-term debt | 0 | 0 | ||
Fair Value, Inputs, Level 2 [Member] | Fair value measurements | ||||
Acquisitions | ||||
Cash and cash equivalents | 0 | 0 | ||
Restricted cash | 0 | 0 | ||
Long-term debt | 469,523,000 | 467,319,000 | ||
Fair Value, Inputs, Level 3 [Member] | Fair value measurements | ||||
Acquisitions | ||||
Cash and cash equivalents | 0 | 0 | ||
Restricted cash | 0 | 0 | ||
Long-term debt | $ 0 | $ 0 |
ACCOUNTS RECEIVABLE, NET (Detai
ACCOUNTS RECEIVABLE, NET (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Accounts receivable, net | |||
Accounts receivable, gross | $ 123,479 | $ 134,858 | |
Less: allowance for doubtful accounts | (18,456) | (22,675) | |
Total | 105,023 | 112,183 | |
Bad debt expense | 5,514 | 16,257 | $ 2,549 |
Billed Revenues | |||
Accounts receivable, net | |||
Accounts receivable, gross | 67,021 | 73,532 | |
Unbilled Revenues | |||
Accounts receivable, net | |||
Accounts receivable, gross | $ 56,458 | $ 61,326 |
PREPAID EXPENSES AND OTHER CU71
PREPAID EXPENSES AND OTHER CURRENT ASSETS (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | ||
Maintenance agreements, current portion | $ 7,000 | $ 6,367 |
Income taxes receivable | 633 | 5,258 |
Prepaid expenses | 7,873 | 6,989 |
Other current assets | 6,245 | 4,953 |
Total | $ 21,751 | $ 23,567 |
PREMISES AND EQUIPMENT, NET (De
PREMISES AND EQUIPMENT, NET (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
PREMISES AND EQUIPMENT, NET | |||
Premises and equipment, gross | $ 248,676 | $ 223,131 | |
Less: accumulated depreciation and amortization | (129,555) | (95,372) | |
Total | 119,121 | 127,759 | |
Depreciation and amortization expense, inclusive of capital leases | 36,470 | 29,046 | $ 19,056 |
Impairment of Long-Lived Assets Held-for-use | 4,100 | 0 | $ 0 |
Computer hardware and software | |||
PREMISES AND EQUIPMENT, NET | |||
Premises and equipment, gross | 177,010 | 140,799 | |
Office equipment and other | |||
PREMISES AND EQUIPMENT, NET | |||
Premises and equipment, gross | 21,720 | 36,032 | |
Furniture and fixtures | |||
PREMISES AND EQUIPMENT, NET | |||
Premises and equipment, gross | 14,443 | 12,231 | |
Leasehold improvements | |||
PREMISES AND EQUIPMENT, NET | |||
Premises and equipment, gross | $ 35,503 | $ 34,069 |
GOODWILL AND INTANGIBLE ASSET73
GOODWILL AND INTANGIBLE ASSETS, NET - Goodwill (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Changes in goodwill | |||
Balance at the beginning of the period | $ 90,851 | $ 99,414 | |
Acquisition of Mortgage Builder | 9,135 | ||
Goodwill impairment | (55,740) | (37,473) | |
Acquisition of Owners | 19,775 | ||
Acquisition of CastleLine | 28,125 | ||
Acquisition of Acquired RentRange and Investability Businesses | 19,565 | ||
Balance at the end of the period | 82,801 | 90,851 | $ 99,414 |
Mortgage Services | |||
Changes in goodwill | |||
Balance at the beginning of the period | 32,733 | 12,958 | |
Acquisition of Mortgage Builder | 0 | ||
Goodwill impairment | 0 | 0 | |
Acquisition of Owners | 19,775 | ||
Acquisition of CastleLine | 28,125 | ||
Acquisition of Acquired RentRange and Investability Businesses | 19,565 | ||
Balance at the end of the period | 80,423 | 32,733 | 12,958 |
Financial Services | |||
Changes in goodwill | |||
Balance at the beginning of the period | 2,378 | 2,378 | |
Acquisition of Mortgage Builder | 0 | ||
Goodwill impairment | 0 | 0 | |
Acquisition of Owners | 0 | ||
Acquisition of CastleLine | 0 | ||
Acquisition of Acquired RentRange and Investability Businesses | 0 | ||
Balance at the end of the period | 2,378 | 2,378 | 2,378 |
Technology Services | |||
Changes in goodwill | |||
Balance at the beginning of the period | 55,740 | 84,078 | |
Acquisition of Mortgage Builder | 9,135 | ||
Goodwill impairment | (55,740) | (37,473) | 0 |
Acquisition of Owners | 0 | ||
Acquisition of CastleLine | 0 | ||
Acquisition of Acquired RentRange and Investability Businesses | 0 | ||
Balance at the end of the period | $ 0 | $ 55,740 | $ 84,078 |
GOODWILL AND INTANGIBLE ASSET74
GOODWILL AND INTANGIBLE ASSETS, NET - Intangible Assets, Net (Details 2) - USD ($) | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Intangible Assets, Net | |||
Impairment of intangible assets | $ 11,900,000 | $ 0 | |
Gross carrying amount | 327,782,000 | $ 338,497,000 | |
Accumulated amortization | (130,779,000) | (93,251,000) | |
Net book value | 197,003,000 | 245,246,000 | |
Amortization expense for definite lived intangible assets | 41,135,000 | 37,680,000 | $ 28,176,000 |
2,015 | 32,300,000 | ||
2,016 | 26,700,000 | ||
2,017 | 23,600,000 | ||
2,018 | 21,400,000 | ||
2,019 | 19,500,000 | ||
Trademarks and trade names | |||
Intangible Assets, Net | |||
Gross carrying amount | 15,244,000 | 13,889,000 | |
Accumulated amortization | (6,491,000) | (5,016,000) | |
Net book value | $ 8,753,000 | 8,873,000 | |
Trademarks and trade names | Weighted average | |||
Intangible Assets, Net | |||
Finite-Lived Intangible Asset, Useful Life | 13 years | ||
Customer-related intangible assets | |||
Intangible Assets, Net | |||
Gross carrying amount | $ 274,428,000 | 289,308,000 | |
Accumulated amortization | (113,725,000) | (79,606,000) | |
Net book value | $ 160,703,000 | 209,702,000 | |
Customer-related intangible assets | Weighted average | |||
Intangible Assets, Net | |||
Finite-Lived Intangible Asset, Useful Life | 10 years | ||
Operating agreement | |||
Intangible Assets, Net | |||
Gross carrying amount | $ 35,000,000 | 35,000,000 | |
Accumulated amortization | (10,354,000) | (8,604,000) | |
Net book value | $ 24,646,000 | 26,396,000 | |
Operating agreement | Weighted average | |||
Intangible Assets, Net | |||
Finite-Lived Intangible Asset, Useful Life | 20 years | ||
Noncompete Agreements [Member] | |||
Intangible Assets, Net | |||
Gross carrying amount | $ 1,435,000 | 0 | |
Accumulated amortization | (115,000) | 0 | |
Net book value | $ 1,320,000 | 0 | |
Noncompete Agreements [Member] | Weighted average | |||
Intangible Assets, Net | |||
Finite-Lived Intangible Asset, Useful Life | 4 years | ||
Intellectual property | |||
Intangible Assets, Net | |||
Gross carrying amount | $ 300,000 | 300,000 | |
Accumulated amortization | (55,000) | (25,000) | |
Net book value | $ 245,000 | 275,000 | |
Intellectual property | Weighted average | |||
Intangible Assets, Net | |||
Finite-Lived Intangible Asset, Useful Life | 10 years | ||
Other Intangible Assets [Member] | Weighted average | |||
Intangible Assets, Net | |||
Finite-Lived Intangible Asset, Useful Life | 5 years | ||
Gross carrying amount | $ 1,375,000 | 0 | |
Accumulated amortization | (39,000) | 0 | |
Net book value | $ 1,336,000 | $ 0 |
INVESTMENT IN EQUITY AFFILIATE
INVESTMENT IN EQUITY AFFILIATE (Details) - Correspondent One - USD ($) $ in Millions | Mar. 31, 2013 | Dec. 31, 2015 | Dec. 31, 2013 | Mar. 29, 2013 |
Investment in equity affiliates | ||||
Ownership percentage | 49.00% | |||
Net gain (loss) on investment using the equity method | $ 0 | $ 0.2 | ||
Ocwen | ||||
Investment in equity affiliates | ||||
Percentage of equity interest sold to the related party | 49.00% | |||
Proceeds from sale of equity interest | $ 12.6 |
OTHER ASSETS (Details)
OTHER ASSETS (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | ||
Security deposits, net | $ 5,341 | $ 7,277 |
Debt issuance costs, net | 6,184 | 8,099 |
Maintenance agreements, non-current portion | 1,570 | 3,324 |
Restricted cash | 4,801 | 3,022 |
Other | 1,441 | 545 |
Total | $ 19,337 | $ 22,267 |
ACCOUNTS PAYABLE, ACCRUED EXP77
ACCOUNTS PAYABLE, ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Accounts Payable and Accrued Liabilities [Abstract] | ||
Accounts payable | $ 11,644 | $ 28,280 |
Accrued expenses - general | 30,347 | 31,693 |
Accrued salaries and benefits | 46,564 | 44,150 |
Income taxes payable | 3,316 | 7,643 |
Total | $ 91,871 | $ 111,766 |
ACCOUNTS PAYABLE, ACCRUED EXP78
ACCOUNTS PAYABLE, ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES (Details 2) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Other current liabilities | ||
Unfunded cash account balances | $ 6,395 | $ 4,788 |
Other | 9,871 | 8,439 |
Total | $ 16,266 | $ 13,227 |
LONG-TERM DEBT (Details)
LONG-TERM DEBT (Details) | Aug. 01, 2014USD ($) | Dec. 08, 2013 | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | Dec. 31, 2013USD ($) | Nov. 27, 2012USD ($) |
Debt | ||||||
Less: unamortized discount, net | $ (2,236,000) | $ (2,929,000) | ||||
Net long-term debt | 534,362,000 | 588,614,000 | ||||
Less: current portion | (5,945,000) | (5,945,000) | ||||
Long-term debt, less current portion | 528,417,000 | 582,669,000 | ||||
Proceeds from issuance of long-term debt | 0 | 198,000,000 | $ 200,502,000 | |||
Extinguishment of Debt, Amount | $ 49,000,000 | |||||
Weighted Average discount of par received on early extinguishment of debt | 10.30% | |||||
Gains (Losses) on Extinguishment of Debt | $ 3,836,000 | 0 | 0 | |||
Debt issuance costs, net | 6,184,000 | 8,099,000 | ||||
Interest on long-term debt | 28,208,000 | 23,363,000 | 20,291,000 | |||
Long-term Debt, Maturities, Repayments of Principal in Next Twelve Months | 5,945,000 | |||||
Long-term Debt, Maturities, Repayments of Principal in Year Two | 5,945,000 | |||||
Long-term Debt, Maturities, Repayments of Principal in Year Three | 5,945,000 | |||||
Long-term Debt, Maturities, Repayments of Principal in Year Four | 5,945,000 | |||||
Long-term Debt, Maturities, Repayments of Principal in Year Five | 512,818,000 | |||||
Debt Instrument Carrying Amount, Noncurrent | 536,598,000 | |||||
Senior secured term loan | ||||||
Debt | ||||||
Amount borrowed | $ 200,000,000 | |||||
Debt Instrument, Maturity Period from Prior Term Loans Maturity Date | 1 year | |||||
Aggregate amount of each consecutive quarterly scheduled principal installment | $ 1,500,000 | |||||
Term of senior secured loan agreement | 7 years | |||||
Mandatory prepayments owed | $ 0 | |||||
Interest rate at the end of the period (as a percent) | 4.50% | |||||
Debt issuance costs, net | $ 6,200,000 | 8,100,000 | ||||
Accumulated amortization | 4,100,000 | 2,200,000 | ||||
Interest on long-term debt | $ 28,200,000 | 23,400,000 | $ 20,300,000 | |||
Senior secured term loan | Maximum | ||||||
Debt | ||||||
Leverage ratio to be maintained under the credit facility covenants | 3 | |||||
Number of days within which the entity fails to pay principal when due or interest or any other amount owing on any other obligation under the credit agreement, is considered as event of default | 5 days | |||||
Amount of principal or interest if failed to pay considered as event of default | $ 40,000,000 | |||||
Amount of debt which results in acceleration of debt if failed to pay considered as event of default | 40,000,000 | |||||
Amount of unbonded, undischarged or unstayed debt under entry by court of one or more judgments for certain period to determine as event of default | $ 40,000,000 | |||||
Senior secured term loan | Minimum | ||||||
Debt | ||||||
Leverage ratio to be maintained under the credit facility covenants | 1 | |||||
Senior secured term loan | Adjusted Eurodollar Rate | ||||||
Debt | ||||||
Reference rate | Adjusted Eurodollar Rate | |||||
Fixed interest rate base (as a percent) | 1.00% | |||||
Interest rate margin (as a percent) | 3.50% | |||||
Senior secured term loan | Base Rate | ||||||
Debt | ||||||
Reference rate | Base Rate | |||||
Fixed interest rate base (as a percent) | 2.00% | |||||
Interest rate margin (as a percent) | 2.50% | |||||
Fair value measurements | ||||||
Debt | ||||||
Long-term Debt, Gross | $ 536,598,000 | $ 591,543,000 |
OTHER NON-CURRENT LIABILITIES80
OTHER NON-CURRENT LIABILITIES (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Gain Contingencies [Line Items] | |||
Business Combination, Contingent Consideration Arrangement - Equator | $ (7,591) | $ (37,924) | $ 0 |
Acquisition related contingent consideration | 3,932 | 11,616 | |
Other non-current liabilities | 14,221 | 9,032 | |
Total | 18,153 | $ 20,648 | |
Equator LLC | |||
Gain Contingencies [Line Items] | |||
Value of Equator contingent consideration after payment to sellers | $ 0 |
SHAREHOLDERS' EQUITY AND SHAR81
SHAREHOLDERS' EQUITY AND SHARE-BASED COMPENSATION (Details) $ / shares in Units, $ in Thousands | Oct. 09, 2015USD ($)shares | Jul. 17, 2015USD ($)shares | May. 20, 2015$ / sharesshares | Dec. 31, 2015USD ($)multipliercomponentinstallmentright$ / sharesshares | Dec. 31, 2014USD ($)$ / sharesshares | Dec. 31, 2013USD ($)$ / sharesshares |
Common Stock [Abstract] | ||||||
Common stock, shares authorized | shares | 25,413,000 | 25,413,000 | ||||
Common stock, shares issued | shares | 25,413,000 | 25,413,000 | ||||
Common stock, shares outstanding | shares | 19,021,000 | 20,279,000 | ||||
Common Stock Voting Rights Per Share | right | 1 | |||||
Value of common stock paid at acquisition | $ | $ 21,733 | $ 0 | $ 0 | |||
Equity Incentive Plan [Abstract] | ||||||
Maximum number of Altisource share-based awards that can be granted under the Plan (in shares) | shares | 6,700,000 | |||||
Share-based awards available for future grants under the Plan (in shares) | shares | 1,600,000 | |||||
Share-Based Compensation [Abstract] | ||||||
Share-based compensation expense (in dollars) | $ | $ 4,800 | $ 2,200 | $ 2,400 | |||
Estimated unrecognized compensation costs (in dollars) | $ | $ 11,400 | |||||
Weighted average remaining requisite service period for stock options over which unrecognized compensation costs would be recognized | 2 years 7 months 24 days | |||||
Outstanding (in shares) | shares | 3,163,125 | 2,601,892 | ||||
Stock options granted, approximate (in shares) | shares | 853,510 | 100,000 | 100,000 | |||
Weighted average exercise price of stock options granted (in dollars per share) | $ / shares | $ 24.21 | $ 84.61 | $ 104.84 | |||
Assumptions used to determine the fair value of options as of the grant date | ||||||
Fair value (in dollars per share) | $ / shares | 13.20 | 26.92 | 32.59 | |||
Weighted average fair value of stock options granted and total intrinsic value of stock options exercised | ||||||
Weighted average fair value at grant date per share (in dollars per share) | $ / shares | $ 13.20 | $ 26.92 | $ 32.59 | |||
Intrinsic value of options exercised (in dollars) | $ | $ 1,998 | $ 10,250 | $ 40,761 | |||
Grant date fair value of options vested during the period (in dollars) | $ | $ 1,616 | $ 2,641 | $ 3,156 | |||
Black-Scholes | ||||||
Assumptions used to determine the fair value of options as of the grant date | ||||||
Risk-free interest rate, minimum (as a percent) | 1.50% | 1.80% | 1.02% | |||
Risk-free interest rate, maximum (as a percent) | 1.91% | 1.91% | 1.81% | |||
Expected stock price volatility, minimum (as a percent) | 55.06% | 37.57% | 36.35% | |||
Expected stock price volatility, maximum (as a percent) | 59.73% | 45.15% | 36.76% | |||
Expected option life | 6 years 3 months | 6 years 3 months | ||||
Binomial | ||||||
Assumptions used to determine the fair value of options as of the grant date | ||||||
Risk-free interest rate, minimum (as a percent) | 0.02% | 0.01% | 0.01% | |||
Risk-free interest rate, maximum (as a percent) | 2.34% | 2.49% | 2.71% | |||
Expected stock price volatility, minimum (as a percent) | 55.06% | 38.38% | 36.40% | |||
Expected stock price volatility, maximum (as a percent) | 59.73% | 45.15% | 36.80% | |||
Minimum | Black-Scholes | ||||||
Assumptions used to determine the fair value of options as of the grant date | ||||||
Expected option life | 6 years | |||||
Fair value (in dollars per share) | $ / shares | $ 10.01 | $ 15.54 | $ 31.33 | |||
Weighted average fair value of stock options granted and total intrinsic value of stock options exercised | ||||||
Weighted average fair value at grant date per share (in dollars per share) | $ / shares | $ 10.01 | $ 15.54 | $ 31.33 | |||
Minimum | Binomial | ||||||
Assumptions used to determine the fair value of options as of the grant date | ||||||
Expected option life | 4 years 29 days | 4 years 4 months 10 days | 4 years 2 months 12 days | |||
Fair value (in dollars per share) | $ / shares | $ 9.91 | $ 12.66 | $ 16.12 | |||
Weighted average fair value of stock options granted and total intrinsic value of stock options exercised | ||||||
Weighted average fair value at grant date per share (in dollars per share) | $ / shares | $ 9.91 | 12.66 | 16.12 | |||
Maximum | Black-Scholes | ||||||
Assumptions used to determine the fair value of options as of the grant date | ||||||
Expected option life | 6 years 3 months | |||||
Fair value (in dollars per share) | $ / shares | $ 17.66 | 41.79 | 49.14 | |||
Weighted average fair value of stock options granted and total intrinsic value of stock options exercised | ||||||
Weighted average fair value at grant date per share (in dollars per share) | $ / shares | $ 17.66 | $ 41.79 | $ 49.14 | |||
Maximum | Binomial | ||||||
Assumptions used to determine the fair value of options as of the grant date | ||||||
Expected option life | 4 years 11 months 1 day | 5 years 9 months 29 days | 6 years 6 months | |||
Fair value (in dollars per share) | $ / shares | $ 18.05 | $ 33.62 | $ 41.72 | |||
Weighted average fair value of stock options granted and total intrinsic value of stock options exercised | ||||||
Weighted average fair value at grant date per share (in dollars per share) | $ / shares | $ 18.05 | $ 33.62 | $ 41.72 | |||
Employee and Non Employee Stock Option | Vesting Based on Service [Member] | ||||||
Share-Based Compensation [Abstract] | ||||||
Vesting period | 4 years | |||||
Outstanding (in shares) | shares | 1,200,000 | |||||
Employee and Non Employee Stock Option | Vesting Based on Service [Member] | Minimum | ||||||
Share-Based Compensation [Abstract] | ||||||
Vesting period | 3 years | |||||
Employee and Non Employee Stock Option | Vesting Based on Service [Member] | Maximum | ||||||
Share-Based Compensation [Abstract] | ||||||
Expiration term | 10 years | |||||
Employee and Non Employee Stock Option | Market-Based | ||||||
Share-Based Compensation [Abstract] | ||||||
Outstanding (in shares) | shares | 2,000,000 | |||||
Number of components of an award | component | 2 | |||||
Vesting percentage for awards that vest upon achievement of certain criteria | 25.00% | |||||
Cumulative vesting percentage for awards that vest in equal annual installments | 75.00% | |||||
Number of equal annual installments for vesting of award | installment | 3 | |||||
Employee and Non Employee Stock Option | Market-Based, ordinary performance | ||||||
Share-Based Compensation [Abstract] | ||||||
Market-based options subject to specified performance achievement (as a percent) | 0.67 | |||||
Multiplier of stock price over exercise price as a condition for the award to vest | multiplier | 2 | |||||
Employee and Non Employee Stock Option | Market-Based, ordinary performance | Minimum | ||||||
Share-Based Compensation [Abstract] | ||||||
Percentage of compounded annual gain of stock price over exercise price required for the award to vest | 20.00% | |||||
Employee and Non Employee Stock Option | Market-Based, extraordinary performance | ||||||
Share-Based Compensation [Abstract] | ||||||
Market-based options subject to specified performance achievement (as a percent) | 0.33 | |||||
Multiplier of stock price over exercise price as a condition for the award to vest | multiplier | 3 | |||||
Employee and Non Employee Stock Option | Market-Based, extraordinary performance | Minimum | ||||||
Share-Based Compensation [Abstract] | ||||||
Percentage of compounded annual gain of stock price over exercise price required for the award to vest | 25.00% | |||||
2015 Stock Repurchase Program | ||||||
Stock Repurchase Plan [Abstract] | ||||||
Number of shares of common stock authorized to be purchased | shares | 3,000,000 | |||||
Percentage of outstanding shares authorized to be repurchased | 15.00% | |||||
Minimum purchase price authorized (in dollars per share) | $ / shares | $ 1 | |||||
Maximum purchase price authorized (in dollars per share) | $ / shares | $ 500 | |||||
Stock Repurchase Programs | ||||||
Stock Repurchase Plan [Abstract] | ||||||
Number of shares of common stock purchased | shares | 2,100,000 | 2,500,000 | 1,200,000 | |||
Average purchase price per share (in dollars per share) | $ / shares | $ 27.60 | $ 103.67 | $ 116.99 | |||
Remaining number of shares available for repurchase under the plan | shares | 1,400,000 | |||||
Capacity available to repurchase common stock under senior secured term loan (in dollars) | $ | $ 360,000 | |||||
RentRange, Investability and Onit Solutions [Member] | ||||||
Common Stock [Abstract] | ||||||
Purchase Price | $ | $ 24,792 | |||||
Number of shares exchanged for acquisition | shares | 247,000 | |||||
Value of common stock paid at acquisition | $ | $ 7,300 | |||||
Business Combination, Contingent Consideration Arrangements, Payment Period | 4 years | |||||
CastleLine | ||||||
Common Stock [Abstract] | ||||||
Purchase Price | $ | $ 33,443 | |||||
Number of shares exchanged for acquisition | shares | 495,000 | |||||
Value of common stock paid at acquisition | $ | $ 14,400 | |||||
Business Combination, Contingent Consideration Arrangements, Payment Period | 4 years |
SHAREHOLDERS' EQUITY AND SHAR82
SHAREHOLDERS' EQUITY AND SHARE-BASED COMPENSATION - Activity related to our stock options (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Number of Options | |||
Outstanding at the beginning of the period (in shares) | 2,601,892 | ||
Granted (in shares) | 853,510 | 100,000 | 100,000 |
Exercised (in shares) | (130,682) | ||
Forfeited (in shares) | (161,595) | ||
Outstanding at the end of the period (in shares) | 3,163,125 | 2,601,892 | |
Exercisable at the end of the period (in shares) | 2,214,051 | ||
Weighted average exercise price | |||
Outstanding at the beginning of the period (in dollars per share) | $ 21.21 | ||
Granted (in dollars per share) | 24.21 | $ 84.61 | $ 104.84 |
Exercised (in dollars per share) | 10.64 | ||
Forfeited (in dollars per share) | 66.72 | ||
Outstanding at the end of the period (in dollars per share) | 20.13 | $ 21.21 | |
Exercisable at the end of the period (in dollars per share) | $ 14.43 | ||
Weighted average contractual term | |||
Weighted average contractual term | 4 years 11 months 9 days | 4 years 5 months 8 days | |
Exercisable at the end of the period | 3 years 1 month 13 days | ||
Aggregate intrinsic value | |||
Aggregate intrinsic value (in dollars) | $ 35,842 | $ 47,805 | |
Exercisable at the end of the period (in dollars) | $ 32,395 |
SHAREHOLDERS' EQUITY AND SHAR83
SHAREHOLDERS' EQUITY AND SHARE-BASED COMPENSATION - Information about stock options outstanding (Details) | 12 Months Ended |
Dec. 31, 2015$ / sharesshares | |
Options outstanding | |
Number (in shares) | shares | 3,163,125 |
Options exercisable | |
Number (in shares) | shares | 2,214,051 |
$0.00 - $10.00 | |
Stock options outstanding and exercisable | |
Exercise price, low end of range (in dollars per share) | $ 0 |
Exercise price, high end of range (in dollars per share) | $ 10 |
Options outstanding | |
Number (in shares) | shares | 1,575,003 |
Weighted average remaining contractual life | 2 years 6 months 15 days |
Weighted average exercise price (in dollars per share) | $ 9.14 |
Options exercisable | |
Number (in shares) | shares | 1,575,003 |
Weighted average remaining contractual life | 2 years 6 months 15 days |
Weighted average exercise price (in dollars per share) | $ 9.14 |
$10.01 - $20.00 | |
Stock options outstanding and exercisable | |
Exercise price, low end of range (in dollars per share) | 10.01 |
Exercise price, high end of range (in dollars per share) | $ 20 |
Options outstanding | |
Number (in shares) | shares | 427,781 |
Weighted average remaining contractual life | 8 years 5 months 9 days |
Weighted average exercise price (in dollars per share) | $ 18.23 |
Options exercisable | |
Number (in shares) | shares | 64,729 |
Weighted average remaining contractual life | 3 years 7 months 28 days |
Weighted average exercise price (in dollars per share) | $ 15.08 |
$20.01 - $30.00 | |
Stock options outstanding and exercisable | |
Exercise price, low end of range (in dollars per share) | 20.01 |
Exercise price, high end of range (in dollars per share) | $ 30 |
Options outstanding | |
Number (in shares) | shares | 881,711 |
Weighted average remaining contractual life | 6 years 8 months 23 days |
Weighted average exercise price (in dollars per share) | $ 25.68 |
Options exercisable | |
Number (in shares) | shares | 470,311 |
Weighted average remaining contractual life | 4 years 3 months 26 days |
Weighted average exercise price (in dollars per share) | $ 23.21 |
$30.01 - $40.00 | |
Stock options outstanding and exercisable | |
Exercise price, low end of range (in dollars per share) | 30.01 |
Exercise price, high end of range (in dollars per share) | $ 40 |
Options outstanding | |
Number (in shares) | shares | 63,880 |
Weighted average remaining contractual life | 7 years 7 days |
Weighted average exercise price (in dollars per share) | $ 32.26 |
Options exercisable | |
Number (in shares) | shares | 39,880 |
Weighted average remaining contractual life | 5 years 5 months 5 days |
Weighted average exercise price (in dollars per share) | $ 33.05 |
$40.01 - $50.00 | |
Stock options outstanding and exercisable | |
Exercise price, low end of range (in dollars per share) | 40.01 |
Exercise price, high end of range (in dollars per share) | $ 50 |
Options outstanding | |
Number (in shares) | shares | 5,000 |
Weighted average remaining contractual life | 8 years 11 months 9 days |
Weighted average exercise price (in dollars per share) | $ 49.06 |
Options exercisable | |
Number (in shares) | shares | 313 |
Weighted average remaining contractual life | 8 years 11 months 9 days |
Weighted average exercise price (in dollars per share) | $ 49.06 |
$60.01 - $70.00 | |
Stock options outstanding and exercisable | |
Exercise price, low end of range (in dollars per share) | 60.01 |
Exercise price, high end of range (in dollars per share) | $ 70 |
Options outstanding | |
Number (in shares) | shares | 71,000 |
Weighted average remaining contractual life | 6 years 2 months 9 days |
Weighted average exercise price (in dollars per share) | $ 60.73 |
Options exercisable | |
Number (in shares) | shares | 46,469 |
Weighted average remaining contractual life | 6 years 2 months 9 days |
Weighted average exercise price (in dollars per share) | $ 60.74 |
$70.01 - $80.00 | |
Stock options outstanding and exercisable | |
Exercise price, low end of range (in dollars per share) | 70.01 |
Exercise price, high end of range (in dollars per share) | $ 80 |
Options outstanding | |
Number (in shares) | shares | 25,000 |
Weighted average remaining contractual life | 8 years 10 months 13 days |
Weighted average exercise price (in dollars per share) | $ 72.78 |
Options exercisable | |
Number (in shares) | shares | 1,563 |
Weighted average remaining contractual life | 8 years 10 months 13 days |
Weighted average exercise price (in dollars per share) | $ 72.78 |
$80.01 - $90.00 | |
Stock options outstanding and exercisable | |
Exercise price, low end of range (in dollars per share) | 80.01 |
Exercise price, high end of range (in dollars per share) | $ 90 |
Options outstanding | |
Number (in shares) | shares | 40,000 |
Weighted average remaining contractual life | 8 years 15 days |
Weighted average exercise price (in dollars per share) | $ 85.63 |
Options exercisable | |
Number (in shares) | shares | 9,063 |
Weighted average remaining contractual life | 7 years 4 months 13 days |
Weighted average exercise price (in dollars per share) | $ 84.35 |
$90.01 - $100.00 | |
Stock options outstanding and exercisable | |
Exercise price, low end of range (in dollars per share) | 90.01 |
Exercise price, high end of range (in dollars per share) | $ 100 |
Options outstanding | |
Number (in shares) | shares | 71,875 |
Weighted average remaining contractual life | 8 years 3 months 29 days |
Weighted average exercise price (in dollars per share) | $ 94.31 |
Options exercisable | |
Number (in shares) | shares | 6,251 |
Weighted average remaining contractual life | 8 years 4 days |
Weighted average exercise price (in dollars per share) | $ 94.26 |
$100.01 - $110.00 | |
Stock options outstanding and exercisable | |
Exercise price, low end of range (in dollars per share) | 101 |
Exercise price, high end of range (in dollars per share) | $ 110 |
Options outstanding | |
Number (in shares) | shares | 1,875 |
Weighted average remaining contractual life | 8 years 4 months 13 days |
Weighted average exercise price (in dollars per share) | $ 105.11 |
Options exercisable | |
Number (in shares) | shares | 469 |
Weighted average remaining contractual life | 8 years 4 months 13 days |
Weighted average exercise price (in dollars per share) | $ 105.11 |
SHAREHOLDERS' EQUITY AND SHAR84
SHAREHOLDERS' EQUITY AND SHARE-BASED COMPENSATION - Market prices necessary in order for the market performance options to begin to vest (Details) | Dec. 31, 2015$ / sharesshares |
Ordinary performance grants | |
Market prices for market performance options to vest | |
Market-based options, options expected to vest (in shares) | 47,500 |
Market-based options, Weighted average share price (in dollars per share) | $ / shares | $ 92.29 |
Extraordinary performance grants | |
Market prices for market performance options to vest | |
Market-based options, options expected to vest (in shares) | 55,875 |
Market-based options, Weighted average share price (in dollars per share) | $ / shares | $ 77.03 |
$170.01 - $180.00 | |
Market prices for market performance options to vest | |
Market-based options, Vesting price, low end of range (in dollars per share) | $ / shares | 170.01 |
Market-based options, Vesting price, high end of range (in dollars per share) | $ / shares | $ 180 |
$170.01 - $180.00 | Ordinary performance grants | |
Market prices for market performance options to vest | |
Market-based options, options expected to vest (in shares) | 12,500 |
$170.01 - $180.00 | Extraordinary performance grants | |
Market prices for market performance options to vest | |
Market-based options, options expected to vest (in shares) | 0 |
$180.01 - $190.00 | |
Market prices for market performance options to vest | |
Market-based options, Vesting price, low end of range (in dollars per share) | $ / shares | $ 180.01 |
Market-based options, Vesting price, high end of range (in dollars per share) | $ / shares | $ 190 |
$180.01 - $190.00 | Ordinary performance grants | |
Market prices for market performance options to vest | |
Market-based options, options expected to vest (in shares) | 12,500 |
$180.01 - $190.00 | Extraordinary performance grants | |
Market prices for market performance options to vest | |
Market-based options, options expected to vest (in shares) | 25,875 |
$190.00 | |
Market prices for market performance options to vest | |
Market-based options, Vesting price, low end of range (in dollars per share) | $ / shares | $ 190 |
Over $190.00 | Ordinary performance grants | |
Market prices for market performance options to vest | |
Market-based options, options expected to vest (in shares) | 22,500 |
Over $190.00 | Extraordinary performance grants | |
Market prices for market performance options to vest | |
Market-based options, options expected to vest (in shares) | 30,000 |
SHAREHOLDERS' EQUITY AND SHAR85
SHAREHOLDERS' EQUITY AND SHARE-BASED COMPENSATION - Restricted Stock awards (Details) - $ / shares | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Equity And Share-Based Compensation | ||
Number of restricted shares outstanding | 272,326 | 26,224 |
Restricted shares granted | 251,938 | |
Number of restricted shares issued during the period | (2,836) | |
Number of Restricted Shares Forfeited | (3,000) | |
weighted average price per share of restricted shares granted | $ 19.25 |
SHAREHOLDERS' EQUITY AND SHAR86
SHAREHOLDERS' EQUITY AND SHARE-BASED COMPENSATION - EARs (Details) - shares shares in Millions | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Equity And Share-Based Compensation | ||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period | 1.1 | |
Stock Appreciation Rights (SARs) [Member] | ||
Equity And Share-Based Compensation | ||
Share-based Compensation Arrangement by Share-based Payment Award, Non-Option Equity Instruments, Percentage Of Divisions, Maximum | 15.00% | |
Stock Appreciation Rights (SARs) [Member] | Consumer Analytics Division [Member] | ||
Equity And Share-Based Compensation | ||
EARs Outstanding | 5.60% | 0.00% |
EARs Granted | 5.60% | |
EARs Forfeited | 0.00% | |
Stock Appreciation Rights (SARs) [Member] | Document Solutions Division [Member] | ||
Equity And Share-Based Compensation | ||
EARs Outstanding | 5.60% | 0.00% |
EARs Granted | 5.80% | |
EARs Forfeited | (0.20%) | |
Stock Appreciation Rights (SARs) [Member] | Marketplace Solutions Division [Member] | ||
Equity And Share-Based Compensation | ||
EARs Outstanding | 5.30% | 0.00% |
EARs Granted | 5.30% | |
EARs Forfeited | 0.00% | |
Time-Based Stock Appreciation Rights (SARs) [Member] | ||
Equity And Share-Based Compensation | ||
Share-based Compensation Arrangement by Share-based Payment Award, Non-Option Equity Instruments, Percentage Of Total Award | 25.00% | |
Vesting period | 4 years | |
Performance-Based Stock Appreciation Rights (SARs) [Member] | ||
Equity And Share-Based Compensation | ||
Share-based Compensation Arrangement by Share-based Payment Award, Non-Option Equity Instruments, Percentage Of Total Award | 75.00% | |
Maximum | ||
Equity And Share-Based Compensation | ||
Share Based Compensation Arrangement by Share Based Payment Award Estimated Forfeiture Rate | 40.00% | |
Maximum | Restricted Stock [Member] | ||
Equity And Share-Based Compensation | ||
Vesting period | 4 years | |
Minimum | ||
Equity And Share-Based Compensation | ||
Share Based Compensation Arrangement by Share Based Payment Award Estimated Forfeiture Rate | 0.00% | |
Minimum | Restricted Stock [Member] | ||
Equity And Share-Based Compensation | ||
Vesting period | 1 year |
REVENUE (Details)
REVENUE (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Revenues [Abstract] | |||
Service Revenue | $ 940,920 | $ 938,679 | $ 662,059 |
Reimbursement Revenue | 107,344 | 137,634 | 102,478 |
Non-controlling interests’ Revenue | 3,202 | 2,603 | 3,820 |
Revenue | $ 1,051,466 | $ 1,078,916 | $ 768,357 |
COST OF REVENUE (Details)
COST OF REVENUE (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Cost of Revenue [Abstract] | |||
Compensation and benefits | $ 261,839 | $ 255,889 | $ 156,812 |
Outside fees and services | 248,278 | 243,325 | 193,233 |
Reimbursable expenses | 107,344 | 137,634 | 102,478 |
Technology and telecommunications | 43,177 | 48,834 | 25,534 |
Depreciation and amortization | 26,689 | 21,498 | 14,423 |
Total | $ 687,327 | $ 707,180 | $ 492,480 |
SELLING, GENERAL AND ADMINIST89
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Selling, General and Administrative Expense [Abstract] | |||
Compensation and benefits | $ 54,897 | $ 45,098 | $ 27,864 |
Professional services | 23,183 | 18,598 | 8,022 |
Occupancy related costs | 39,917 | 38,262 | 28,424 |
Amortization of intangible assets | 41,135 | 37,680 | 28,176 |
Depreciation and amortization | 9,781 | 7,548 | 4,633 |
Marketing costs | 27,499 | 24,130 | 5,028 |
Other | 24,456 | 30,417 | 11,663 |
Total | $ 220,868 | $ 201,733 | $ 113,810 |
LOSS ON SALE OF HLSS EQUITY S90
LOSS ON SALE OF HLSS EQUITY SECURITIES, NET OF DIVIDENDS RECEIVED (Details) - USD ($) $ in Thousands, shares in Millions | Apr. 29, 2015 | Mar. 17, 2015 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 |
Schedule of Available-for-sale Securities [Line Items] | |||||
Payments to Acquire Available-for-sale Securities, Equity | $ 30,000 | $ 29,966 | $ 0 | $ 0 | |
Liquidating dividend | $ 20,400 | ||||
Sale proceeds from HLSS common stock | $ 7,700 | ||||
Loss on sale of HLSS equity securities, net of dividends received | (1,854) | $ 0 | $ 0 | ||
HLSS | |||||
Schedule of Available-for-sale Securities [Line Items] | |||||
Loss on sale of HLSS equity securities, net of dividends received | $ 1,900 | ||||
Common stock | HLSS | Fair value measurements | Fair Value, Inputs, Level 1 [Member] | |||||
Schedule of Available-for-sale Securities [Line Items] | |||||
Available-For-Sale Securities, Number Of Shares Acquired | 1.6 | ||||
Available-For-Sale Securities, Shares Sold | 1.6 |
OTHER INCOME (EXPENSE), NET (De
OTHER INCOME (EXPENSE), NET (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Other Income and Expenses [Abstract] | |||
Gains (Losses) on Extinguishment of Debt | $ 3,836 | $ 0 | $ 0 |
Loss in equity affiliate, including impairment loss | 0 | 0 | (176) |
Interest income | 133 | 103 | 899 |
Other, net | 76 | 71 | (166) |
Total | $ 4,045 | $ 174 | $ 557 |
INCOME TAXES INCOME TAXES (Deta
INCOME TAXES INCOME TAXES (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Income before income taxes and non-controlling interests [Line Items] | |||||||||||
Domestic - Luxembourg | $ 27,884 | $ 124,181 | $ 122,722 | ||||||||
Total | $ (44,192) | $ 41,200 | $ 51,244 | $ 4,808 | $ (28) | $ 45,867 | $ 58,225 | $ 43,201 | 53,060 | 147,265 | 142,333 |
U.S. Federal | |||||||||||
Income before income taxes and non-controlling interests [Line Items] | |||||||||||
Foreign - U.S. and Non-U.S. | 5,944 | 9,575 | 11,125 | ||||||||
Non U.S. | |||||||||||
Income before income taxes and non-controlling interests [Line Items] | |||||||||||
Foreign - U.S. and Non-U.S. | $ 19,232 | $ 13,509 | $ 8,486 |
INCOME TAXES (Details 2)
INCOME TAXES (Details 2) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Current: | |||
Domestic - Luxembourg | $ 1,787 | $ 4,415 | $ 2,516 |
Current income tax provision | 9,586 | 9,012 | 6,525 |
Deferred: | |||
Deferred income tax provision | (1,326) | 1,166 | 2,015 |
Total | 8,260 | 10,178 | 8,540 |
Decrease in foreign taxes due to tax holidays | $ 800 | $ 900 | $ 200 |
Effect on diluted per share due to decrease in foreign tax holiday (in dollars per share) | $ 0.04 | $ 0.04 | $ 0.01 |
Statutory tax rate | 29.22% | 29.22% | 29.22% |
U.S. Federal | |||
Current: | |||
Foreign | $ 539 | $ 75 | $ 6 |
Deferred: | |||
Foreign | (108) | 1,756 | 2,506 |
U.S. State | |||
Current: | |||
Foreign | 855 | 476 | 403 |
Deferred: | |||
Foreign | (526) | (281) | 84 |
Non U.S. | |||
Current: | |||
Foreign | 6,405 | 4,046 | 3,600 |
Deferred: | |||
Foreign | $ (692) | $ (309) | $ (575) |
INCOME TAXES (Details 3)
INCOME TAXES (Details 3) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Current deferred tax assets: | ||
Allowance for doubtful accounts and other reserves | $ 0 | $ 72 |
Accrued expenses | 0 | 5,165 |
Current deferred tax liabilities: | ||
Prepaid expenses | 0 | (250) |
Current deferred tax assets, net | 0 | 4,987 |
Non-current deferred tax assets: | ||
Net operating loss carryforwards | 5,417 | 13,940 |
U.S. federal and state tax credits | 2,577 | 1,202 |
Non-U.S. deferred tax assets | 2,472 | 1,780 |
Share-based compensation | 1,750 | 856 |
Accrued expenses | 7,730 | 0 |
Non-current deferred tax liabilities: | ||
Intangible assets | (4,508) | (5,302) |
Depreciation | (7,446) | (11,878) |
Other | (815) | (177) |
Deferred tax assets net of deferred tax liabilities | 7,177 | 421 |
Valuation allowance | (3,558) | (3,115) |
Non-current deferred tax liabilities, net | 0 | 2,694 |
Deferred Tax Assets, Net of Valuation Allowance, Noncurrent | 3,619 | 0 |
Net deferred tax assets | 3,619 | 2,293 |
Income Taxes | ||
Increase in valuation allowance related to state and foreign losses | 400 | |
Undistributed earnings | 63,500 | |
Deferred tax liability that would be recognized if earnings were distributed | 12,500 | |
Gross amount of net operating losses available for carryover to future years | 14,800 | 35,700 |
U.S. State | ||
Non-current deferred tax assets: | ||
Net operating loss carryforwards | 1,600 | 1,800 |
Luxembourg | ||
Non-current deferred tax assets: | ||
Net operating loss carryforwards | 2,300 | 1,700 |
U.S. Federal | ||
Income Taxes | ||
Net operating loss carryforwards related to stock options exercised, not recognized | 13,600 | 13,600 |
U.S. State and U.S. Federal | ||
Non-current deferred tax assets: | ||
Net operating loss carryforwards | 2,600 | 1,200 |
NCI | ||
Income Taxes | ||
Annual limit on use of operating loss carryforward | 1,300 | |
Gross amount of net operating losses available for carryover to future years | $ 10,100 | $ 12,200 |
INCOME TAXES (Details 4)
INCOME TAXES (Details 4) | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Reconciliation of Income Tax Provision to the Luxembourg income tax rate | |||
Statutory tax rate | 29.22% | 29.22% | 29.22% |
Permanent difference related to Luxembourg intangible assets | (13.56%) | (22.60%) | (23.59%) |
Change in valuation allowance | 0.83% | (0.05%) | 0.76% |
State tax expense | 0.29% | 0.03% | 0.24% |
Tax credits | (2.34%) | (0.71%) | (0.00%) |
Uncertain taxes | 1.39% | 0.88% | 0.00% |
Other | (0.26%) | 0.14% | (0.63%) |
Effective tax rate | 15.57% | 6.91% | 6.00% |
INCOME TAXES (Details 5)
INCOME TAXES (Details 5) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward] | ||
Amount of unrecognized tax benefits as of the beginning of the year | $ 1,153 | $ 0 |
Increases as a result of tax positions taken in a prior period | 638 | 1,153 |
Increases as a result of tax positions taken in the current period | 214 | 0 |
Amount of unrecognized tax benefits as of the end of the year | 2,005 | 1,153 |
Unrecognized tax benefits that would affect the effective tax rate | 2,100 | 1,300 |
Unrecognized Tax Benefits, Income Tax Penalties and Interest Accrued | 200 | $ 100 |
Significant Change in Unrecognized Tax Benefits is Reasonably Possible, Amount of Unrecorded Benefit | $ 1,500 |
EARNINGS PER SHARE (Details)
EARNINGS PER SHARE (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Earnings Per Share [Abstract] | |||||||||||
Net income attributable to Altisource | $ (45,096) | $ 37,046 | $ 45,950 | $ 3,698 | $ (1,535) | $ 42,287 | $ 54,101 | $ 39,631 | $ 41,598 | $ 134,484 | $ 129,973 |
Weighted average common shares outstanding, basic | 19,196 | 19,091 | 19,571 | 20,172 | 20,306 | 21,626 | 22,089 | 22,509 | 19,504 | 21,625 | 23,072 |
Dilutive effect of stock options and restricted shares | 1,115 | 2,009 | 1,981 | ||||||||
Weighted average common shares outstanding, diluted | 19,196 | 20,411 | 20,669 | 20,995 | 20,306 | 23,640 | 24,166 | 24,662 | 20,619 | 23,634 | 25,053 |
Earnings per share: | |||||||||||
Basic (in dollars per share) | $ (2.35) | $ 1.94 | $ 2.35 | $ 0.18 | $ (0.08) | $ 1.96 | $ 2.45 | $ 1.76 | $ 2.13 | $ 6.22 | $ 5.63 |
Diluted (in dollars per share) | $ (2.35) | $ 1.82 | $ 2.22 | $ 0.18 | $ (0.08) | $ 1.79 | $ 2.24 | $ 1.61 | $ 2.02 | $ 5.69 | $ 5.19 |
Employee and Non Employee Stock Option | |||||||||||
Anti-dilutive securities | |||||||||||
Options excluded from the computation of diluted EPS, approximate (in shares) (less than 0.1 million shares for the years 2014 and 2013) | 600 | 100 | 100 | ||||||||
Options for shares issuable upon achievement of market and performance criteria | |||||||||||
Anti-dilutive securities | |||||||||||
Options excluded from the computation of diluted EPS, approximate (in shares) (less than 0.1 million shares for the years 2014 and 2013) | 300 | 100 | 100 |
COMMITMENTS AND CONTINGENCIES98
COMMITMENTS AND CONTINGENCIES (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | Nov. 15, 2013 | |
Operating Lease Obligations | ||||
Additional revenue earned on portfolios serviced by Ocwen | 21.00% | |||
Operating lease obligations | ||||
2,015 | $ 17,308 | |||
2,016 | 15,085 | |||
2,017 | 10,983 | |||
2,018 | 7,451 | |||
2,019 | 3,654 | |||
Thereafter | 4,860 | |||
Operating lease obligations | $ 59,341 | |||
Sales Revenue, Segment [Member] | Ocwen | Revenue from Rights Concentration Risk [Member] | ||||
Operating Lease Obligations | ||||
Concentration Risk, Percentage | 60.00% | 60.00% | 65.00% | |
Financial Standby Letter of Credit [Member] | ||||
Operating Lease Obligations | ||||
standby letter of credit | $ 1,700 | |||
Equator LLC | Financial Standby Letter of Credit [Member] | ||||
Operating Lease Obligations | ||||
standby letter of credit | $ 700 |
COMMITMENTS AND CONTINGENCIES99
COMMITMENTS AND CONTINGENCIES (Details 2) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Operating Lease Obligations | |||
Total operating lease expense, net of sublease income | $ 20 | $ 20.1 | $ 12.8 |
Escrow and Trust Balances | |||
Amounts held in escrow and trust accounts | $ 66.6 | $ 62.5 | |
Minimum | |||
Operating Lease Obligations | |||
Customary lease term | 1 year | ||
Maximum | |||
Operating Lease Obligations | |||
Customary lease term | 7 years |
SEGMENT REPORTING (Details)
SEGMENT REPORTING (Details) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2015USD ($) | Sep. 30, 2015USD ($) | Jun. 30, 2015USD ($) | Mar. 31, 2015USD ($) | Dec. 31, 2014USD ($) | Sep. 30, 2014USD ($) | Jun. 30, 2014USD ($) | Mar. 31, 2014USD ($) | Dec. 31, 2015USD ($)segment | Dec. 31, 2014USD ($) | Dec. 31, 2013USD ($) | |
Segment Reporting [Abstract] | |||||||||||
Number of reporting segments | segment | 3 | ||||||||||
SEGMENT REPORTING | |||||||||||
Revenue | $ 1,051,466 | $ 1,078,916 | $ 768,357 | ||||||||
Cost of revenue | 687,327 | 707,180 | 492,480 | ||||||||
Gross profit | $ 97,395 | $ 98,926 | $ 100,162 | $ 67,656 | $ 69,235 | $ 98,964 | $ 112,073 | $ 91,464 | 364,139 | 371,736 | 275,877 |
Selling, general and administrative expenses | 220,868 | 201,733 | 113,810 | ||||||||
Impairment losses | 71,785 | 37,473 | 0 | ||||||||
Business Combination, Contingent Consideration Arrangement - Equator | (7,591) | (37,924) | 0 | ||||||||
Income from operations | 79,077 | 170,454 | 162,067 | ||||||||
Other income (expense), net | (26,017) | (23,189) | (19,734) | ||||||||
Income before income taxes and non-controlling interests | 53,060 | 147,265 | 142,333 | ||||||||
Total Assets: | |||||||||||
Total Assets | 727,982 | 788,221 | 727,982 | 788,221 | |||||||
Operating Segment | Mortgage Services | |||||||||||
SEGMENT REPORTING | |||||||||||
Revenue | 786,648 | 793,143 | 599,319 | ||||||||
Cost of revenue | 474,169 | 486,387 | 376,639 | ||||||||
Gross profit | 312,479 | 306,756 | 222,680 | ||||||||
Selling, general and administrative expenses | 105,153 | 94,686 | 46,522 | ||||||||
Impairment losses | 0 | 0 | |||||||||
Business Combination, Contingent Consideration Arrangement - Equator | 0 | 0 | |||||||||
Income from operations | 207,326 | 212,070 | 176,158 | ||||||||
Other income (expense), net | 506 | 204 | (136) | ||||||||
Income before income taxes and non-controlling interests | 207,832 | 212,274 | 176,022 | ||||||||
Total Assets: | |||||||||||
Total Assets | 325,461 | 313,550 | 325,461 | 313,550 | |||||||
Operating Segment | Financial Services | |||||||||||
SEGMENT REPORTING | |||||||||||
Revenue | 88,448 | 98,499 | 92,958 | ||||||||
Cost of revenue | 60,806 | 64,338 | 55,328 | ||||||||
Gross profit | 27,642 | 34,161 | 37,630 | ||||||||
Selling, general and administrative expenses | 18,707 | 18,791 | 15,571 | ||||||||
Impairment losses | 0 | 0 | |||||||||
Business Combination, Contingent Consideration Arrangement - Equator | 0 | 0 | |||||||||
Income from operations | 8,935 | 15,370 | 22,059 | ||||||||
Other income (expense), net | 58 | 62 | (10) | ||||||||
Income before income taxes and non-controlling interests | 8,993 | 15,432 | 22,049 | ||||||||
Total Assets: | |||||||||||
Total Assets | 53,757 | 56,096 | 53,757 | 56,096 | |||||||
Operating Segment | Technology Services | |||||||||||
SEGMENT REPORTING | |||||||||||
Revenue | 215,482 | 227,300 | 100,724 | ||||||||
Cost of revenue | 187,835 | 192,426 | 82,612 | ||||||||
Gross profit | 27,647 | 34,874 | 18,112 | ||||||||
Selling, general and administrative expenses | 29,902 | 32,393 | 12,435 | ||||||||
Impairment losses | 71,785 | 37,473 | |||||||||
Business Combination, Contingent Consideration Arrangement - Equator | (7,591) | (37,924) | |||||||||
Income from operations | (66,449) | 2,932 | 5,677 | ||||||||
Other income (expense), net | 61 | (31) | 7 | ||||||||
Income before income taxes and non-controlling interests | (66,388) | 2,901 | 5,684 | ||||||||
Total Assets: | |||||||||||
Total Assets | 165,778 | 250,059 | 165,778 | 250,059 | |||||||
Corporate Items and Eliminations | |||||||||||
SEGMENT REPORTING | |||||||||||
Revenue | (39,112) | (40,026) | (24,644) | ||||||||
Cost of revenue | (35,483) | (35,971) | (22,099) | ||||||||
Gross profit | (3,629) | (4,055) | (2,545) | ||||||||
Selling, general and administrative expenses | 67,106 | 55,863 | 39,282 | ||||||||
Impairment losses | 0 | 0 | |||||||||
Business Combination, Contingent Consideration Arrangement - Equator | 0 | 0 | |||||||||
Income from operations | (70,735) | (59,918) | (41,827) | ||||||||
Other income (expense), net | (26,642) | (23,424) | (19,595) | ||||||||
Income before income taxes and non-controlling interests | (97,377) | (83,342) | $ (61,422) | ||||||||
Total Assets: | |||||||||||
Total Assets | $ 182,986 | $ 168,516 | $ 182,986 | $ 168,516 |
SEGMENT REPORTING (Details 2)
SEGMENT REPORTING (Details 2) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Premises & equipment, net | ||
Premises and equipment, net | $ 119,121 | $ 127,759 |
United States | ||
Premises & equipment, net | ||
Premises and equipment, net | 85,021 | 88,274 |
India | ||
Premises & equipment, net | ||
Premises and equipment, net | 21,187 | 27,082 |
Luxembourg | ||
Premises & equipment, net | ||
Premises and equipment, net | 9,944 | 9,059 |
Philippines | ||
Premises & equipment, net | ||
Premises and equipment, net | 2,664 | 3,344 |
URUGUAY | ||
Premises & equipment, net | ||
Premises and equipment, net | $ 305 | $ 0 |
QUARTERLY FINANCIAL DATA (UN102
QUARTERLY FINANCIAL DATA (UNAUDITED) (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Quarterly Financial Information Disclosure [Abstract] | |||||||||||
Revenue | $ 269,887 | $ 272,776 | $ 268,321 | $ 240,482 | $ 255,887 | $ 287,688 | $ 296,072 | $ 239,269 | |||
Gross profit | 97,395 | 98,926 | 100,162 | 67,656 | 69,235 | 98,964 | 112,073 | 91,464 | $ 364,139 | $ 371,736 | $ 275,877 |
Income (loss) before income taxes and non-controlling interests | (44,192) | 41,200 | 51,244 | 4,808 | (28) | 45,867 | 58,225 | 43,201 | 53,060 | 147,265 | 142,333 |
Net income | (44,351) | 37,897 | 46,846 | 4,408 | (906) | 43,115 | 54,732 | 40,146 | 44,800 | 137,087 | 133,793 |
Net income (loss) attributable to Altisource | $ (45,096) | $ 37,046 | $ 45,950 | $ 3,698 | $ (1,535) | $ 42,287 | $ 54,101 | $ 39,631 | $ 41,598 | $ 134,484 | $ 129,973 |
Earnings per share: | |||||||||||
Basic (in dollars per share) | $ (2.35) | $ 1.94 | $ 2.35 | $ 0.18 | $ (0.08) | $ 1.96 | $ 2.45 | $ 1.76 | $ 2.13 | $ 6.22 | $ 5.63 |
Diluted (in dollars per share) | $ (2.35) | $ 1.82 | $ 2.22 | $ 0.18 | $ (0.08) | $ 1.79 | $ 2.24 | $ 1.61 | $ 2.02 | $ 5.69 | $ 5.19 |
Weighted average shares outstanding: | |||||||||||
Basic (in shares) | 19,196 | 19,091 | 19,571 | 20,172 | 20,306 | 21,626 | 22,089 | 22,509 | 19,504 | 21,625 | 23,072 |
Diluted (in shares) | 19,196 | 20,411 | 20,669 | 20,995 | 20,306 | 23,640 | 24,166 | 24,662 | 20,619 | 23,634 | 25,053 |
Impairment losses | $ 71,785 | $ 37,473 | $ 0 |
SCHEDULE II. VALUATION AND Q103
SCHEDULE II. VALUATION AND QUALIFYING ACCOUNTS (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Allowance for Doubtful Accounts | |||
Movement in Valuation Allowances and Reserves [Roll Forward] | |||
Valuation allowances, beginning balance | $ 22,675 | $ 5,631 | $ 3,274 |
Valuation allowances, Charged to Expenses | 5,514 | 16,257 | 2,549 |
Valuation allowances, Charged to Other Accounts | (4) | 1,399 | 0 |
Valuation allowances, Deductions | 9,729 | 612 | 192 |
Valuation allowances, ending balance | 18,456 | 22,675 | 5,631 |
Valuation Allowance of Deferred Tax Assets | |||
Movement in Valuation Allowances and Reserves [Roll Forward] | |||
Valuation allowances, beginning balance | 3,115 | 3,189 | 2,413 |
Valuation allowances, Charged to Expenses | 674 | 0 | 0 |
Valuation allowances, Charged to Other Accounts | 0 | 0 | 776 |
Valuation allowances, Deductions | 231 | 74 | 0 |
Valuation allowances, ending balance | $ 3,558 | $ 3,115 | $ 3,189 |