Safe Harbor Statement

This presentation contains forward-looking statements. The Company desires to take advantage of the Safe Harbor Provisions of the Private Securities
Litigation Reform Act of 1995 and is including this statement for the express purpose of availing itself of the protections of the safe harbor with respect to
all forward-looking statements. Therefore, the Company wishes to caution each participant to consider carefully the specific factors discussed with each
forward-looking statement in this presentation and other factors contained in the Companys filings with the Securities and Exchange Commission under
the captions Forward-Looking Statements, Risk Factors and Managements Discussion and Analysis of Financial Condition and Results of Operations as
such factors in some cases have affected, and in the future (together with other factors) could affect, the ability of the Company to implement its business
strategy and may cause actual results to differ materially from those contemplated by the statements expressed herein. The information contained in this
presentation speaks as of May 9, 2014. The Company assumes no obligation to update the information or the forward-looking statements contained herein,
whether as a result of new information or otherwise.
Non-GAAP Financial Measures
The financial measures EBITDA, Adjusted EBITDA, Free Cash Flow and Cash Earnings Per Share, as used in this presentation, are supplemental measures of
the Companys performance that are not Generally Accepted Accounting Principles (GAAP) measures. Refer to slides 83 and 84 of this presentation and
Tables 5a, 5b, 6a, 6b, 7, 8 and 9, of the Companys May 5 press release announcing first quarter 2014 financial results for the definitions of these non-GAAP
financial measures, a reconciliation of these measures to their most comparable GAAP measures, and the Companys explanation of why it believes these
non-GAAP measures are useful to investors.
Market and Industry Data and Forecasts
This presentation includes information published by the National Association of Realtors (NAR) and the Federal National Mortgage Association (Fannie
Mae). NAR and Fannie Mae are two of the primary sources of third-party industry data and forecasts. While data provided by NAR and Fannie Mae are
two indicators of the direction of the residential housing market, we believe that homesale statistics will continue to vary between us, on the one hand,
and NAR and Fannie Mae, on the other, because they use survey data in their historical reports and forecasting whereas Realogy uses data based on actual
reported results. In addition to the differences in calculation methodologies, there are geographical differences and concentrations in the markets in which
we operate versus the national market. NAR historical data is subject to periodic review and revision and these revisions could be material. NAR and Fannie
Mae generally update their forecasts on a monthly basis and a subsequent forecast may change materially from a forecast that was previously issued.
While we believe this industry data is derived from the most widely recognized sources for reporting U.S. residential housing market statistical data, we do
not endorse or suggest reliance on this data alone.

Richard A. Smith
Chairman, Chief Executive Officer & President

Composition of Homebuyers
Homebuyer Classification

60%
54%

55%
50%

51%
47%

48%

49%

49%

48%
44%

44%

50%

50%

54%

53%

53%
51%

51%

51%

48%

46%

40%
38%
37%

36%

38%

35%

32%

33%

34%

35%

36%
31%

32%

35%
33%

34%

31%

31%

30%

29%

30%

22%

23%

25%

21%
19%

20%
15%

47%

43% 44%

45%
40%

50%

49%

46%

55%

12% 14%

15%

20%

20%

18%

18%

18%

29%

30%
28%

28%

20%

21%
19%

18%

21%
19%

16%

15%

28%

22%

23%
21%

29%

19%

19%
17%

16%

13%

10%

First-Time Buyer

Individual Investor

All Other

Source: National Association of Realtors

Credit Remains Challenging

760

748 749

745 743
742 743 742

740

737

734 732 732

729 727

724 724 725

720
700

699 699 699

696 697 697 696 695 694 694

692 690 690
688 686
684

March 2014:
33% of all closed loans had
an average FICO score of less
than 700 compared to 27%
one year ago.

FICO - All Loans

FICO - FHA Purchase

680
660
640

Source: Ellie Mae Origination Insight Report, March 2014

Inventory Levels and Sources of Inventory

Potential Triggers for Inventory Increases

4,500

14

4,000

12

Recovering negative equity

3,500

10

Move up buyer activity

3,000

New construction

2,500

2,000

1,500

1,000

Home price appreciation

Months Supply

Inventory Levels

Inventory Levels and Months Supply

Rental rate increases rent vs own

Normalization of underwriting standards

Inventory

Months' Supply

Source: Inventory levels and supply, National Association of

Realtors

Mortgage Mix Shifting to Purchase Market

Trending:
Purchase loan
market climbing
as credit
requirements
normalizing.

80
70
60
50
40

REFI %

30

Purchase %

20
10
Mar-14

Feb-14

Jan-14

Dec-13

Nov-13

Oct-13

Sep-13

Aug-13

Jul-13

Jun-13

May-13

Apr-13

Mar-13

Feb-13

Jan-13

Dec-12

Source: Ellie Mae Origination Insight Report, March 2014

Transaction Volume Trends by Price Points

(Shown as Percentages of Total Volume)

60%
50%

RFGs shift in
mix evidenced
by decline at
lower end and
growth
at higher price
points.

54%
50%
44%
36%

40%

38%

34%

30%

Q1 2012
18%

20%

13% 14%

Q1 2013
Q1 2014

10%
0%

0-$300k

$300k -$1mm

> $1 mm

Fee-for-Service Business Focused on Residential Real Estate

Real Estate Franchise Services (RFG)

Owned Brokerage Network (NRT)

Largest U.S. Residential Real Estate

Brokerage

Worlds Largest Real Estate Franchisor

26%

55%

13%

Relocation
Services

Title Settlement & Services

6%

Leading Global Relocation

Company

Significant Provider of Title

& Settlement Services

Alex Perriello
President & CEO, Realogy Franchise Group

10

RFG Business Unit

WHO
The worlds
largest
residential real
estate franchisor

WHAT
What makes us
unique is our multibrand approach to
the business

How We Do Business:

We deliver compelling brand value propositions

We sell franchises

We service franchisees

We renew franchisees

BRANDS

PURPOSE

We operate six
world class
brands in 103
countries

We help
real estate
entrepreneurs be more
successful.

Key Franchise Metrics:

Average U.S. franchisee tenure is 20 years

Typical franchise agreement is 10 years

Franchisee retention rate 98%

No franchisee (excluding NRT) represents more than

1% of RFG revenues

11

How We Generate Revenue

Transaction Volume 2013*
Average Homesale Price

Homesale Sides
1,083,424

$233,011

X
Average Broker Commission Rate
per Side
(2.54%)

X
Net Effective Royalty Rate

(4.49%)

=
RFG Net Domestic Franchise
Royalty Revenue
($299 Million)

* Does Not Include NRT

12

Efficient Operating Structure

Separate Brand Leadership, Broker Services, Marketing and Training

Franchise
Administration and
Compliance

Finance/Audit

Franchise
Sales

Human Resources

Legal

Information
Technology

13

Geographic Footprint
Office Distribution

Royalty Distribution
International
4%

Our global affiliate base :

-

Representation in 103 countries

2013 RFG Domestic GCI of $6.7 billion

International
56%

Domestic
44%

Domestic
96%

Brand Presence
As of December 31, 2013

2013 Sides

Offices
Worldwide

Sales
Associates
Worldwide

# of
Countries

Aided Brand
Awareness

Century 21

410,543

7,109

103,833

74

94%*

Coldwell Banker

725,058

3,120

84,912

49

86%*

Coldwell Banker
Commercial

Incl. in CB

195

2,563

35

91%**

118,160

2,325

31,223

34

41%*

55,712

259

8,371

Sothebys International
Realty

78,841

698

14,529

52

N/A

Corcoran Group

11,751

32

2,319

N/A

1,400,065

13,738

247,750

103

ERA
Better Homes and Gardens
Real Estate

Total****

97%***

* Millward Brown 2013 Ad Tracking Study

** Penton Media 2012
*** BHG Magazine has 97% Brand Awareness
**** Includes NRT

14

Franchise Competitive Landscape

Brand Presence

Offices U.S.

Agents U.S.

Offices
Worldwide

Agents
Worldwide

# of Countries

Aided Brand
Awareness

Realogy (all brands)

5,992

170,278

13,738

247,750

103

--

RE/MAX

3,300

54,491

6,481

93,228

95

91%*

678

74,470

700

95,000

12

46%*

1,800

55,000

1,800

55,000

67%*

Realty Executives

395

N/A

507

10,000

26

13%*

Exit Realty

449

3,245

449

3,245

N/A

Keller Williams
Berkshire Hathaway
HomeServices /
Prudential / Real Living**

Regional (Limited Franchising)

Weichert

374

14,000

374

14,000

N/A

Long & Foster

164

10,054

164

10,054

N/A

Windemere

295

7,000

295

7,000

N/A

Howard Hanna

167

5,700

167

5,700

N/A

* Millward Brown 2013 Ad Tracking Study

** Berkshire Hathaway HomeServices (BHHS), Prudential Real Estate Affiliates, and
Real Living are owned by HSF Affiliates LLC. A conversion process to BHHS is
currently underway. As of April 23, 2014, the BHHS network accounts for
approximately 28,000 agents and 750 offices in 37 states of the combined total
listed above.

15

Franchise Sales Growth Opportunities

40%
Affiliated

Franchised firms are typically larger

companies, thus 44% of firms with four or
more offices are franchised companies.*

87% of firms reported their current franchise

affiliation improved their firm name
recognition; 85% reported an improved use
of technology; and 83% reported an
improvement in acquiring listings.*

60%
Unaffiliated

60% of Realtors are Unaffiliated

with any Franchise

Growth Strategy

Sign new franchises

Market driven approach to Franchise Sales
Target top 10 Dark Markets and Top 10 Underserved Markets by brand
Deploy resources to those markets where opportunities exist
Brand Presidents Prospect-List

* NAR 2013 Member Profile Survey

16

Annualized Impact of 2013 Franchise Sales

2013 in GCI from Franchise Sales (in millions)*

Net Incremental Annualized Sides
% of 2012 total RFG Sides

$256
20,422
2.1%

* Includes franchisee sales associate walk-overs

17

Why Brokers Affiliate With Our Brands - GROWTH

TOOLS

TECHNOLOGY
MARKETING

REFERRALS

FIELD

BRAND NAME

RECOGNITION

CONSULTING
GROWTH

OPPORTUNITIES

18

Why Brokers Affiliate With Our Brands - GROWTH

Lead Management (LeadRouter)

TOOLS

Customer Relationship Management

Recruiting Platform

TECHNOLOGY

Online Learning
Business Management (Crest EDG)
Buyer and Seller Presentations

Brand Intranet Sites

Why Brokers Affiliate With Our Brands - GROWTH

National Brand Advertising
MARKETING

Global Consumer Website

Niche Market Website

REFERRALS

Local Consumer Website (PC and Mobile)

YouTube Channel
SEO and SEM
Broker to Broker Referrals
Cartus Broker Network (when applicable)

Why Brokers Affiliate With Our Brands - GROWTH

FIELD

Dedicated Business Consultants

Value Proposition Expertise

CONSULTING

Business and Financial Planning

Market and Business Analytics

Best Practices

Networking, Learning Events and

Conferences
Succession Planning

Why Brokers Affiliate With Our Brands - GROWTH

GROWTH

Dedicated Franchise Sales Team

Acquisition and Roll-In Support
OPPORTUNITIES

Competitor Analysis and Strategy

In-Person Prospecting
Selling the Value Proposition

Multiple Listing Service Overview

Listing Agreement
Exclusive authorization to sell and receive a commission
Asset of the listing broker
MLS Function
Aggregates the listings from local members
Shares listing data with all members
Establishes policies, procedures and guidelines for
commission participation
Arbitrates disputes between members
Listing distribution to third parties as directed by
Individual Member/Broker
MLS Structure
870 local MLSs in the U.S.
Local member governance

19

Brand Umbrella Web Strategy

Deliver a Superior User Experience

Build Brand Awareness and Preferences
Generate Incremental Leads to Franchisees
Anywhere, Anytime, Any Device

20

Listing Distribution Strategy

RFG
Shared Listing Database

Others

Listing distribution agreements with Zillow, Trulia, Homes and Homefinder

Agreements provide significant advantages to our franchisees and their independent
contractor agents
NAR statistics show that 90% of buyers use an agent after finding a home on the web
compared to 79% in 2009*
* NAR 2013 Profile of Homebuyers and Sellers

21

Lead Volume Trends

Lead Volume
RFG Brand Sites

Lead Volume
All Sources (Except Brand Sites)

600,000

2,000,000

CAGR 46%

510,183
CAGR 27%

450,000

368,352

1,228,397

241,234

300,000

1,479,895

1,000,000

851,659
719,482

162,647

150,000
-

2010

2011

2012

2013

2010

Conversion Rate: 5.6%

2011

2012

2013

Conversion Rate: 2.0%

Note: Data does not include NRT

22

Other Key Business Driver Trends

Average Broker Commission Rate
2.51%

2.47%

2.49%

2.52%

2.55%

2.54%

2.55%

2.54%

2.54%

2005

2006

2007

2008

2009

2010

2011

2012

2013

Net Effective Royalty Rate

4.69%

2005

4.87%

5.03%

2006

2007

5.12%

2008

5.10%

2009

5.00%

4.84%

4.63%

4.49%

2010

2011

2012

2013

Note: Does not include NRT

23

RFG Performance Award Rebate Impact

Incents Growth
Ensures contract compliance
Contractual ability to raise GCI thresholds annually
Illustrative Purposes Only
Example

Year 1

Year 2

$ Change

$10,000,000

$15,000,000

$5,000,000

6% Royalty

$600,000

$900,000

$300,000

Rebate

$84,356

$183,684

$99,329

Net Royalties

$515,644

$716,316

$200,671

5.16%

4.78%

Company GCI

Net Effective Royalty Rate

24

Summary Franchisee Overview

2013 Sales Volume by Geography

Percentage of GCI by Top 250 Franchisees

Northeast
18%
West
33%

Midwest
15%

South
34%

Contract renewals by year as percentage of 2013 GCI

2013 GCI Breakout

2014
5% 2015
5% 2016

Other
40%

5%

2017
6%
2018
9%

Top 250
60%
2019 and
beyond
70%

Note: Excludes NRT

25

RFG Goals and Objectives

Continue to increase value proposition of each brand

Franchise Sales goal is to increase transaction sides by 1% - 2% above market

Enhance productivity of franchisees

Invest in technology
Lead Generation and management
Assist franchisees with acquisitions

Maintain historically high franchisee retention rate

Continue to focus on net effective royalty rate and expense structure to enhance
profitability

26

Bruce Zipf
President & CEO, NRT

27

NRT: Leader in Key Real Estate Markets

# of Offices
NY Metro Area

154

631
80

New England
Florida

78

32
70

Southern California

66

Northern California
Chicago, IL

51

Minnesota

32
22

St. Louis, MO

21

Baltimore, MD

20

11

20

Phoenix, AZ

124

All Others

706 2
706

Total
TotalOffices
Offices

2013 Avg. Sale Price Comparison

NRT Presence
NRT MSA Presence

$471k
$245k

National Average

NRT
National or Regional
National or Regional

Volume ($bn)

Markets Served

Homesale Sides
Homesale Sides

# of Offices

NRT (2013)

National

$149.2

40 Markets

316,640

706

HomeServices of America (Berkshire Hathaway)

National

63.5

19 Markets

205,602

455

Long & Foster Companies

Regional

26.1

Mid-Atlantic

73,202

164

Firm

Weichert

Regional

374

Source: Competitor data, April 2014 REAL Facts Database data is as of 12/31/2013.
NAR.
2 Weichert information is from Weichert franchise sales documents.
1 Per

28

Diversified Market Presence

Business Overview

Diverse Group of Attractive Markets

World's largest residential real estate brokerage company

MidAtlantic
5%

706 offices
42,358 sales associates

Other
8%

2013 Total Revenue:

$4.0 billion

$149 billion in sales volume in 2013

Ranked No.1 or No.2 in most of its markets
Provider of Real Estate related services:

PHH Home Loan J.V.

Property Management
Insurance

Florida
10%

Resort Rental
Title

Northeast
California
Midwest
Florida
Mid-Atlantic
All Other1
1
Total

Homesale Sides
% Change vs. PY
14%
0%
15%
6%
4%
7%
9%

California
28%

Midwest
15%

2013 NRT Market Trends

2013 FY

Northeast
34%

Total NRT
Average Homesale
Price% Change vs. PY
1%
13%
8%
14%
6%
8%
6%

2013
Sides
ASP

2012

316,640 289,409
$471,144 $444,638

% Change
vs. PY
9%
6%

1 Includes

SIR Santa Fe, Denver, Utah,

Arizona, Hawaii, and Atlanta

29

NRTs Key Business Driver Trends

Home Sale Price

Home Sale Sides

$500,000
$400,000

316,640

300,000

200,000
100,000

Up 6%
YOY

$300,000
$200,000
$100,000

2013

2012

2011

2010

2009

68.21%
2013

2012

2011

2010

2009

2008

2007

2013

2012

2011

2010

2009

2008

2007

2006

2.40%

Up 45
bps YOY

2006

2.49%

2.50%

2.50%

70%
60%
50%
40%
30%
20%
10%
0%

67.80%

Flat YOY

2005

2008

Sales Associate Split

2005

2.55%

2007

2005

2013

2012

2011

2010

2009

2008

2007

2006

2005

Average Broker Commission Rate Per Side

2006

$0

2.45%

$471,144

468,248

400,000

$600,000

Up 9%
YOY

$470,538

500,000

30

NRTs Key Business Objectives

I.

II.
III.
IV.
V.

Utilize NRTs Competitive Advantages to Recruit,

Retain, and Promote Productive Sales Associates
Execute our Acquisition Strategy for Existing and
New Real Estate Markets
Leverage Technology to Enhance Operating
Performance
Maximize Primary Service and Secondary Revenue
Opportunities
Improve Overall EBITDA Margins

31

Use Our Competitive Advantage to

Recruit Sales Associates
Production from New Recruits By Year
($ in millions)

Gross Commission Revenue

$200
$167

$175
$150
$125

15%
$134

8%

7%
$113

$116

2009

2010

2009
7,040
$16

2010
7,323
$16

$187

15%

$100
$75
$50
$25
$0

New Sales

Associates1

GCI/Agent (000s)

2011
2011
7,491
$18

1.

2012

2013

2012
7,998
$21

2013
9,153
$21

Excludes Sales Associate Disassociations

32

Retain Top Producing Sales Associates

Retention of Top 2 Agent Quartiles
(Based on Gross Commission Revenue)

94.5%
94.0%

94%

94%

94%

94%

2010

2011

2012

2013

93.5%
93.0%

93%

93%

2008

2009

92.5%
92.0%

92%

91.5%
91.0%
2007

33

Execute Acquisition Strategy in Existing and New Markets

Acquisition Trend
($ in millions)

Gross Commission Income

$100

$87
$73

$75
$60
$50
$19

$25

$13

$6
$0

Number of Acquisitions

2009

2010

2011

2012

2013

2014
YTD

13

15

34

Where Our Business Comes From:

Sales Associate Sphere of Influence Remains the No. 1 Source of Business
Where BUYERS find their Sales Associate
Offline Ads
1%
Yard Signs
6%

Sphere of
Influence

Other
10%

Relo or
Walk-ins
7%

Referrals
46%

Open House or
Prospecting
9%

Where SELLERS find their Sales Associate

Offline Ads
4%
Yard Signs
3%
Relo or
Walk-ins
5%

Sphere of
Influence

Other
10%

Referrals
42%

Open House
or Prospecting
8%
Internet
4%

Internet
9%

Past Client
12%

Past Client
24%

Source: National Association of Realtors 2013 Profile of

Home Buyers and Sellers

35

Leverage Technology to Enhance Revenue Opportunities

Where Internet Opportunities are Generated for NRT

BUYERS

Internet

Local NRT
Sites
30%
700+
Other
web sites
70%

Source: NRTs March 2014 LTM Internet prospect leads

36

Enhance Lead Generation / Conversion to

Enhance Operating Performance
Illustrative Purposes Only
Traditional Closing
Home Price

Gross Commission
(one side)

$300,000
2.5%

$7,500

Referral Fee
Company Retention

Referral Closing

30%

$2,250

$300,000
2.5%

$7,500

35%

$2,625

40%

$1,950

Gross Profit Before

Royalty

$2,250

$4,575

NRT Gross Profit

/Gross Commission

30%

61%

37

Optimize the Lead Channel

Lead Conversion Funnel

ACQUIRE
CAPTURE
QUALIFY &
ASSIGN
PROSPECT

MORE leads:

Focus on key initiatives to

increase Internet presence and
generate more opportunities
BETTER lead handling:

Improved systems for our

centralized contact centers and
agents

ENGAGE

Improved understanding of
performance

REPRESENT

Increased accountability for

performance

CLOSE

Online Transaction
HomeBase management
system

38

Leverage NRTs Footprint to Enhance

Primary Services & Secondary Revenue
2013 Contribution by Primary Services to Realogy
($ in millions)

EBITDAR Contributions

$30

$24

$23

$20
$9

$10

$8
$4

$0
Mortgage

Title

Commercial Prop. Mgmt./

Resort Rental

Insurance/
Home
Warranty

EBITDA included in NRTs P&L

EBITDAR included in TRGs P&L

EBITDAR: Earnings Before Interest, Taxes, Depreciation,

Amortization, and Royalty
39

Ryan Gorman
Senior Vice President, Strategic Operations
&

Ryan Melone
Vice President, Strategic Development

40

M&A Process

Deal
Sourcing

Valuation
Process

Approval

Negotiations
& Diligence

Closing
Integration

41

Types of Transactions

Deal Type

$ Revenue/Typical Size Preferred Attributes

Standard Roll-In

Up to ~$5 Million
1-2 Office Consolidations

Close proximity to current NRT offices

Similar commission plans and corporate culture, etc.

Stand Alone

$5-$10 Million
1-2 Office Acquisition

Filling gaps in existing footprint

Similar commission plans and corporate culture, etc.

Multi-Office Acquisition
Midsize Acquisition
Augmenting Existing Market $20-$40 Million

Significant office overlap and back office savings

Similar commission plans and corporate culture, etc.
Real Trends estimates ~140 brokers of this size in U.S.

Entering a New Market

Markets with above average home sales price

Leading companies in their respective markets

Large Acquisition
$50 Million +

Similar commission plans and corporate culture, etc.

Real Trends estimates fewer than 70 brokers of this size
Beyond NRT and BHHS, next 10 largest brokers
reported by Real Trends generated 2013 cumulative GCI
of ~$2.2 billion

42

Simple Pricing Strategy Example

USD 000's

Company Financials
GCI/Revenue
Percent Retained
Gross Profit (After Agent Splits)

$7,500
30%
$2,250

$750
Year 2 Earnout

$750
Seller Operating Expense
Seller's Adjusted EBITDA
Multiple 5x
Purchase Price
Purchase Price Summary
Cash at Close
Year 1 Earnout
Year 2 Earnout
Total

- $1,500
$750

Year 1 Earnout

$3,750

$2,250
+
+

Cash Up Front

$2,250
$750
$750
$3,750

43

Value Circle Created Earnings

USD 000's

Midsize Roll-In

Realogy Earnings Breakdown

GCI/Revenue

$7,500

RFG (GCI/Revenue x 6%)

$450

45%

Gross Profit

$2,250

NRT

$350

35%

TRG

$150

15%

$50
$1,000

5%
100%

Seller's Adjusted EBITDA

$750
Synergy
+ $250
Incremental Realogy EBITDA
$1,000

PHHHL

44

Augmenting an Existing Market

USD 000's

Synergy delay (approximately 90 days to implement)

Purchase Price: $23,900

Year 1

Year 2

Year 3

GCI/Revenue
Gross Profit
Percent Retained

$43,100
$10,775
25%

$44,000
$11,000
25%

$45,943
$11,486
25%

Seller's Operating Expense

Synergies
Realogy Operating Expense

$7,875
($2,450)
$5,425

$8,033
($3,618)
$4,415

$8,193
($3,618)
$4,576

NRT EBITDA
RFG EBITDA
Other EBITDA (TRG/PHHHL)
Realogy Incremental EBITDA

$2,350
$2,520
$480
$5,350

$3,385
$2,550
$650
$6,585

$3,590
$2,620
$700
$6,910

NRT ROR
Realogy ROR
ROI

5.5%
12.4%
22.4%

7.7%
15.0%
27.6%

7.8%
15.0%
28.9%

Data based upon actual acquisition

45

Augmenting an Existing Market

USD 000's

NRT Seasonality Impact

Assumes Deal Closes January 1st

GCI/Revenue ($43,139)
Gross Profit [A]
Seller Operating Expense
Synergies
Realogy Operating Expense [B]
Realogy Incremental EBITDA [C] = [A] - [B]
RFG EBITDA
Other EBITDA (TRG/PHHL)
NRT Incremental EBITDA
NRT ROR

1st Quarter 2nd Quarter 3rd Quarter 4th Quarter

17.9%
29.2%
28.2%
24.7%
$7,715
$12,585
$12,154
$10,646
$1,929
$3,146
$3,039
$2,661
$1,969
$1,969
$1,969
$1,969
$0
($817)
($817)
($817)
$1,969
$1,152
$1,152
$1,152

Total
$43,100
$10,775
$7,875
($2,450)
$5,425

($40)

$1,994

$1,886

$1,509

$5,350

$460
$100
($600)
(7.8%)

$710
$130
$1,154
9.2%

$720
$140
$1,026
8.4%

$630
$110
$769
7.2%

$2,520
$480
$2,350
5.5%

Data based upon actual acquisition

46

Entering a New Market

USD 000's

GCI/Revenue

Initial Target
Company
~2010
Roll-In A
$26,000
$975

Roll-In B
$850

Roll-In C
$990

Metro 2013 with

Acquisitions, Recruiting,
and Market Improvements
$45,411

Gross Profit

$9,500

$335

$330

$230

$13,852

Estimated Purchase Price

$12,200

$460

$670

$555

$13,885

*Realogy Incremental EBITDA

Realogy ROR

$2,755
10.6%

$200
20.5%

$235
27.6%

$160
16.2%

$7,260
16.0%

Realogy ROI

22.6%

43.5%

35.1%

28.8%

52.3%

* Includes EBITDA to NRT, RFG, TRG, and PHHHL, before most overhead expense allocations
Data based upon actual acquisition

47

BREAK

48

Kevin Kelleher
President & CEO, Cartus

49

Cartus: Leading Global Relocation Services Company

Key Revenue Drivers

Client Transactional Fees

Outsource provider of Global Mobility Services

Manages residential real estate transactions at
departure and destination points
Receives referral fees from Cartus Broker Network
members

Initiations

Average
Fee

+
Household Goods and Moving
Company Commissions

Integral to our overall business model

Top 25 clients have an average tenure of 18 years
Broad & growing international reach (>150 countries) and
product portfolio
Customer base includes 50% of Fortune 50 companies
High quality broker network is largest in the U.S.

Real Estate Referral Fees

Referrals

Average
Referral Fee

Other Revenue1

=
Total Cartus
Segment Revenue
1 Other

revenue includes net interest income

on funds advanced to transferees, policy
advisory fees, and other items.

2 As

of 12/31/2013.

50

Cartus Customer Referrals

Corporate

Affinity

Broker to Broker

(Employees of
Corporate Clients)

(Members)

(Agents with Retail

Customers)

Cartus
Policy Consultation
Advocacy
Brokerage/Agent Selection
Quality Control

51

Cartus Broker Network

425 Principal Brokers & 377 Associate

Brokers
Almost 3,000 Sales Offices & 43,300
A-Team Agents
Nearly 32,413 unique residential ZIP
codes serviced
503 individual MLS

52

Cartus 2013 Highlights

Value Circle Contribution

Closings by units
2013
Affinity
Relocation

Affinity

Broker to Broker

136,889 Referrals
49,961 placements
(up 12.2%)
49,834 Affinity closings (up 24.5%)
17,588 Broker to Broker closings
5,500 AGR Closings
(up 17.4%)
GCI = $336 million
GCI = $121 million

Broker to Broker
25,000
20,000 16,211

89,651 Closings (up 13.7%)

GCI = $707 million

17,588

15,000
10,000

Relocation
22,229 Relocation closings
GCI = $250 million

5,000
2001 2003 2005 2007 2009 2011 2013

53

Cartus: 2014 and Beyond

Drive Profitable Organic Growth

Expand existing client
relationships
Grow mobility market share
Grow Affinity Services
Execute on Margin Enhancing Initiatives
Reduce expenses
Increase efficiencies
Improve price competitiveness
Identify and Establish Non-Relocation
Revenue Opportunities
Language
Immigration

Expand Global Footprint in Response to

Client Expectations and Opportunity for
Growth
Latin America
India
Maintain Competitive Service Scores
That Support Brand Reputation as
Superior Provider and Market Leader
Invest in systems
Integration of mobile
technologies

54

Cartus Global Footprint

Global Coverage
Cartus Office Locations
Onsite Client Centers
GlobalNet Destination Service Providers

THE AMERICAS

EMEA

APAC

Danbury
Chicago
Dallas
Los Angeles
Memphis
Minneapolis
Montreal
Omaha
Sacramento

Swindon
Amsterdam
Geneva
London
Munich
Paris
Zurich

Singapore
Beijing
Hong Kong
Shanghai

55

Largest Provider of Outsourced, End-to-End Relocation Services

Domestic Services

International Services

Intercultural & Language Training

Acadia Moving Services

Acadia Temporary Housing1
Home Sale Assistance
Marketing Assistance
Buyer Value Option Program
Rental Assistance
Home Purchase Assistance
Mortgage Assistance
Short Sales Counseling
Lump Sum Support
Spouse/Partner Assistance

Acadia Moving Services

Acadia Temporary Housing1
Host Country Services
Departure Program
Intl Educational Counseling
and Placement
Furniture Services
International AutoSource
Visa & Immigration Services
School Search
Lease Negotiation
Look/See Visits
Spouse/Partner Assistance

Candidate Assessment
Cross-Cultural Training
Repatriation Integration
Language Training
Global Awareness Seminars
Global Business Briefings
Global Workforce Development
Intercultural Management Training

Consulting Solutions

Program Administration
Pre-decision Counseling
Preparation of Letter of Assignment
Cost Estimates
Policy Counseling
Expense Administration

Policy Consulting
Benchmarking
Policy Design/Rewrite
Transition Planning
Group Moves
Virtual Resource Center

Balance Sheet Prep/Comp Accumulation

Ongoing Assignment Support
Executive Support Services
Tenancy Payment Services
Property Management

Note: programs vary based on local country customs

1

Patented eProcurement bidding model

56

Don Casey
President & CEO, Title Resource Group

57

Full-service title and settlement services company

- Licensed Title Agent in 42 states and Washington, D.C.

Underwriter of title insurance policies for residential real estate transactions

- Licensed title insurance underwriter in 27 states and Washington, D.C.

Revenue earned at the time a homesale or refinancing closes

Provides refinance closing services for third party lenders
Largest real estate affiliated title and settlement company

* Pie chart represents

% of 2013 EBITDA

58

59

70

105

62

63

94

93

89

76

105

116

60

42% capture rate

Settlement services through

nationwide closing network

Title and settlement services for refinance

and resale transactions
Private label closing process

Increase NRT capture rates

Expand in lock step with NRT acquisitions
Grow TRG footprint for NRT and unaffiliated business

Maintain high service levels

Destination lead conversions

Adjust facilities and staffing with refinance levels

Capture home equity business

Turn-key title & closing solutions to franchisees

Strategically work with the largest franchisees on affiliated relationships:

Underwrite established affiliated title companies
Partner with large affiliates creating title agency joint ventures
Market to smaller brokers within footprint

Continue vertical integration of TRG operations

Strategically partner with agents to supplement business
Expand with affiliated title companies

61

Richard A. Smith
Chairman, Chief Executive Officer & President

62

Perspective on Existing Home Sales and Median Price

US Home Sale Units and Median Home Price
Median home price

4,260

4,190

5,257

5,090

4,976

4,660

6,176

7,080

4,110

3,849

3,884

3,737

3,431

3,146

3,290

3,184

3,513

3,474

3,436

3,134

2,829

2,697

200

150

100

1,990

2,419

3,827

3,986

3,650

2,973

2,476

2,272

2,334

4,000

3,064

5,000

250

20112013
+19.48%

5,030

19911992
+9.06%

4,965

19821983
+35.53%

4,167

19751976
+23.75%

4,374

6,000

5,634

7%

5,335

5%

Total

5,173

2%

Median price

5,179

7,000

Units

20012002
+5.60%

6,477

CAGR
19722013

8,000

3,000

Median home price ($000)

Recovery

6,778

Recession

4,340

US Home sale units

US home sale units (000)

2,000
50

2015E

2013

2014E

2012

2011

2010

2009

2008

2007

2006

2005

2004

2003

2002

2001

2000

1999

1998

1997

1996

1995

1994

1993

1992

1991

1990

1989

1988

1987

1986

1985

1984

1983

1982

1981

1980

1979

1978

1977

1976

1975

1974

1973

1,000

Source: National Association of Realtors

Note: Informative historical interest rates per Freddie Mac
1986: 10.2%, 1987: 10.2%, 1994: 8.4%, 1995: 7.9%

63

Near and Long-Term Drivers Support Continued Housing Market Growth

Home Price Drivers

Near-Term Outlook
Projected Change in Existing Homesale Transaction Volume (Sides +

Price)1

Tight housing supply in most markets

Rental rate increases

20%

Housing affordability

Average industry 2014E and

2015E forecast1

15%

4% average annual existing home price appreciation

forecasted for 2014-20172
Homesale Drivers

10%

19%

Pent up demand: 20 million renters qualified to buy a home

in 2012 versus 9 million in 20053
10%

5%

Existing homesales as a percentage of U.S. households

reverts to its 4.5% mean level4

4%
0%

2013

2014E

Historically low mortgage rates

2015E

Harvards housing think tank projections indicate that

household growth should average 1.16 million annually in
the decade leading up to 20205.
Sources: National Association of Realtors; Fannie Mae
1 NAR 2013 actuals are based on transaction volume (sides x average price), 2014 and 2015 forecast based
on units + median price. NAR May 2014 forecast and Fannie Mae April 2014 forecast.
2 John Burns Real Estate Consulting as of February 2014.
3 Economic research from NAR.
4 Existing homesale data from NAR and US household estimates from Census Bureau.
5 Joint Center for Housing Studies of Harvard University, State of the Nations Housing 2013.

64

Regulatory Issues
QRM
QRM likely to be aligned with QM
No stringent down payment requirements as earlier contemplated

GSE Reform- Johnson-Crapo GSE Reform Bill

Proposes elimination of Fannie Mae and Freddie Mac and creation of Federal Mortgage
Insurance Corporation (FMIC)
Private capital would bear first 10 percent of credit losses and FMIC would absorb
balance of losses
Not likely to be voted on ahead of Novembers midterm elections
Likely to meet stiff resistance in the House

65

Management Initiatives to Drive Growth

Real Estate Franchise Services

New franchise sales

Enhance franchisee productivity
Renew and retain existing franchisees

Penetrate new markets

Incentivize franchisees to accelerate growth

Owned Brokerage Network

Recruit and develop new sales associates

Expand rental services and property management
Enhance ancillary service capture rates
Increase high-margin lead conversion
Continue selective tuck-in and strategic acquisitions

Relocation Services

Title and Settlement Services

Grow client base through new signings

Increase NRT capture rates

Increase value proposition for existing clients

Increase unaffiliated business

Expand new service offerings and global footprint

(e.g., Learnship)

Increase agency services for franchisees

Execute on margin-enhancing initiatives

Continue to grow third-party lender channel

Continue to prudently expand underwriting

66

Tony Hull
Executive Vice President, CFO & Treasurer

67

First Quarter 2014 Results

Financial Metric
Q1 Net Revenue

$1.0 billion (up 5% year-over-year)

Adjusted EBITDA*

$53 million, down from $71 million in 2013

Net loss attributable to the

Company

Net loss of $46.0 million

GAAP net loss includes $70 million of
interest expense, $46 million of
depreciation and amortization expense and
$10 million in pre-tax charges related to
the repricing of its term loan and
repurchases of $44 million of senior
secured notes during the quarter

Loss per share

GAAP basic loss per share for the quarter

was $0.32
* Refer to Appendix of this presentation for Adjusted EBITDA
reconciliation.

68

First Quarter 2014 Revenue Drivers

Q1 2014 vs. Q1 2013
Amount

% Change

Realogy Franchise Group

Homesale sides
Average homesale price

203,972

(3)%

$236,711

+12%

56,685

(2)%

$489,053

+14%

NRT
Homesale sides
Average homesale price

69

First Quarter 2014 Revenue Drivers (Contd)

Q1 2014 vs. Q1 2013
Amount

% Change

Cartus
Initiations

37,898

+5%

Broker referrals

16,496

+5%

Purchase title units

20,775

(3)%

Refinance title units

7,199

(70)%

$1,715

+30%

Title Resource Group

Avg. fee per closing unit

70

Second Quarter 2014 Transaction Volume Guidance

Q2 2014 vs.
Realogy Combined (both RFG and NRT)

Q2 2013 %
Change

Homesale sides

-5% to -7%

Average homesale price

+5% to +7%

Transaction volume

-2% to +2%

71

Segment EBITDA Summary

2013 Actual
$ in millions

Revenue

RFG

NRT

CARTUS

TRG

$690(1)

$3,990

$419

$467

% of
Total

Less: Costs

% of
Total

% of
Total

Corp

% of
Total

Variable

30(2)

19%

3,069

81%

238

76%

273

65%

Fixed (3)

134

81%

739

19%

77

24%

144

35%

Sub Total

164

3,808

National Advertising Fund

Expense/(PHH)

78(4)

(24)(5)

Total Costs

242(1)

3,784

314

418

EBITDA

$448

$206

$104

$50

% Margin

65%

5%

25%

11%

Employees

576

4,138

2,861

2,033

487

Overall 2013 Cost Structure 77% Variable / 23% Fixed

1 Includes

intercompany royalties and marketing fees paid by NRT to RFG of $277

million and included as an expense in NRT. Includes national advertising fund revenue
of $78 million.
2 RFG variable costs exclude national advertising fund expenses.
3 Fixed costs generally increase annually due to inflation.
4 National Advertising Fund revenue and expense offset one another.
5 Represents earnings from PHH

72

Seasonality of Revenues and EBITDA

2013
First

Second

Third

Fourth

Full Year

Quarter

Quarter

Quarter

Quarter

$5,289

$957

$1,533

$1,553

$1,246

18%

29%

29%

24%

285

151

$ in millions

Total Realogy Revenues

% total

58%
Total Adjusted EBITDA *

796

71

278

% total
71%
Adjusted EBITDA Margin
Homesale Transaction Sides

15%

7%

18%

18%

12%

1,400,064

267,839

395,298

408,515

328,412

57%
* Refer to Appendix of this presentation for Adjusted EBITDA
reconciliation.

73

US Home Sales and Prices*

Median Price

Price

Sales

Sales

$235,000

270,000
260,000

$225,000

250,000
240,000

$215,000

230,000
$205,000

220,000
210,000

$195,000

200,000
$185,000

190,000
180,000

$175,000

170,000
$165,000

160,000
150,000

$155,000

3/31/14

1/31/14
2/28/14

12/31/13

11/30/13

10/31/13

9/30/13

8/31/13

7/31/13

6/30/13

5/31/13

4/30/13

3/31/13

1/31/13
2/28/13

12/31/12

11/30/12

10/31/12

9/30/12

8/31/12

7/31/12

6/30/12

5/31/12

4/30/12

3/31/12

2/29/12

1/31/12

12/31/11

11/30/11

10/31/11

9/30/11

8/31/11

7/31/11

6/30/11

5/31/11

4/30/11

$145,000

3/31/11

140,000
130,000

* Based on the Top 100 MSAs (excluding Wichita) Source: DataQuick;

DQNews.com

74

Existing Homesale Transaction Volume Remains Well Below Peak

U.S. Existing Home Sales Transaction Value - NAR

Realogy Revenue and Adjusted EBITDA

($ in billions)

($ in millions)

Revenue

$8,000

Transaction Volume (Home Sales * Average Price)

$2,000

Adj EBITDA

$7,135

$1,888

$7,000

$1,800

34% below
peak

$1,600

$6,000

$5,289

$1,400

$1,250

$5,000

$4,672

$1,200

$4,093

$1,050
$1,000

$4,000

$912

$800

$3,000

$600

$2,000
$400

$1,167
$1,000

$200
$0
2005

//

2011

2012

2013

$0
2005

NAR EHS
% Change

7.08M

4.26M
(40)%

4.66M
9%

5.09M
9%

Realogy Sides 2.32M

% Change

Avg. Sales Price

% Change

$267K

$214K
(20)%

$225K
5%

$246K
9%

Realogy Avg.
Price
% Change

$274K

//

$796

$674

$571

2011

2012

2013

1.16M
(50)%

1.28M
9%

1.40M
9%

$266K
7%

$287K
8%

$248K
(9)%

Realogys Financial Results Over Past Three Years Have Tracked Housing Recovery
NOTE: Existing home sale transaction volume based on National Association
of Realtors.

75

Historical Financial Performance

($ in millions)

2011

% Growth

2012

% Growth

2013

% Growth

Revenue
Realogy Franchise Group

$557

-1%

$604

8%

$690

14%

NRT

2,970

-2%

3,469

17%

3,990

15%

Cartus

423

4%

423

-%

419

-1%

TRG

359

10%

421

17%

467

11%

Eliminations
Total Revenue

(216)
$4,093

EBITDA
Realogy Franchise Group
NRT
Cartus
TRG
Corporate *

(245)
1%

$4,672

% Margin

(277)
14%

$5,289

% Margin

13%
% Margin

$320

57%

$364

60%

$448

65%

56

2%

165

5%

206

5%

115

27%

103

24%

104

25%

29

8%

38

9%

50

11%

(77)

(473)

(155)

Total EBITDA

$443

$197

$653

Adjusted EBITDA

$571

13.9%

$674

14.4%

$796

15.1%

* Note: Corporate in 2013 includes $68 million loss on early extinguishment

of debt, $4 million legacy benefit, $30 million of costs for Phantom Value Plan.
2012 includes $24 million loss on early extinguishment of debt and $400
million in IPO related charges and $8 million benefit from legacy charges.
2011 includes $36 million loss on early extinguishment of debt, $15 million
Apollo management fee and $15 million benefit from legacy charges.

76

Industry Forecasts
2015 Forecasts

2014 Forecasts
8%
3% Volume
6%

14%
4% volume

12%

2%
0%

5.1%

-1.0%

% Change

% Change

6.4%

-2%

9%
volume

10%

4%

8%

-3.3%
2%

-4%

9%
volume

2.2%

4.2%

10%
volume

2.8%

3.0%
4.8%

6%
4%

12%
volume

11%
volume

9.5%
6.6%

6.2%

7.0%

4.1%

0%
NAR

FNMA

Price

Sides

NOTE: NAR forecast as of May 2014, all other forecasts as of April

2014.

77

RLGY Continues to Strategically Deleverage and Reduce Interest Expense

Realogy intends to continue to pay down high-cost debt and reduce interest costs and is focused on reducing
overall leverage
Annual run rate cash interest expense approximately $215 million1 after Term Loan B repricing, 1.5 lien debt
repurchases and partial refinance of 1.5 lien debt with 4.5% notes.
$2.1 billion of NOLs at year-end 2013, which do not begin to expire until 2027

($ in millions)

Rate

Next Call date

First Call Price

Cash & equivalents

Actual March 31,

2014

Adjustments

$119

Proforma March
31, 2014
$119

Revolver

L+275

$145

Term Loan

L+300

$1,884

$1,884

First Lien Debt

7.625%

Jan 16

103.813%

$593

$593

1.5 Lien Debt

7.875%

Feb 15

103.938%

$685

1.5 Lien Debt

9.000%

Jan 16

104.500%

$196

$196

Senior Cash Notes

3.375%

May 16

NCL

$500

$500

Senior Cash Notes

4.500%

April 19

NCL

Total Net Debt

$(53)

$(354)

$3,884

(1)

$450

$92

$331

$450
$3,927

Assuming three month LIBOR remains below 0.75%

78

Key Takeaways

2014 potentially challenging year due to macroeconomic

conditions and strength of 2013
If transaction volume continues to moderate in 2014,
Adjusted EBITDA margin could be 50 90 bps below
2013 levels
Interest expense reduced $70M or 26% from 2013 levels
Free cash flow generation remains strong
Consensus view on 2015 transaction volume growth is
encouraging

79

Q&A

80

This Concludes Todays Webcast

Thank you

81

Appendix

82

GAAP Reconciliation
($ in millions)
Net income attributable to the Company
Income tax benefit
Income before income taxes
Interest expense, net
Depreciation and amortization
EBITDA
Restructure costs and legacy benefits, net
Loss on the early extinguishment of debt
Pro forma effect of business optimization initiatives
Non-cash charges
Pro forma effect of acquisitions and new franchisees
Fees for secondary equity offerings
Incremental securitization interest costs
Adjusted EBITDA

LTM Ended
March 31, 2014
$467
(283)
184
262
180
$626
76
12
44
17
2
4
$781

Note: Refer to Table 9 of the Press Release dated May 5, 2014 for the definitions of certain non-GAAP financial measures, and the Companys explanation
of why it believes those non-GAAP measures are useful to investors.

83

GAAP Reconciliation
($ in millions)
Net loss attributable to the Company

Three months ended

March 31, 2014

Three months ended

March 31, 2013

$(46)

$(75)

Income tax (benefit) expense

(34)

Loss before income taxes

(80)

(68)

Interest expense, net

70

89

Depreciation and amortization

46

42

$36

$63

10

Non-cash charges

(2)

Pro forma effect of business optimization initiatives

Pro forma effect of acquisitions and new franchisees

Incremental securitization interest costs

$53

$71

EBITDA
Former parent legacy costs, net
Loss on the early extinguishment of debt

Adjusted EBITDA

Note: Refer to Table 9 of the Press Release dated May 5, 2014 for the definitions of certain non-GAAP financial measures and the Companys explanation of why it
believes those non-GAAP measures are useful to investors.

84