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ICE Mortgage Technology loses $6 million in 2Q22

Intercontinental Exchange executives were bullish on their mortgage business despite a second-quarter GAAP operating loss of $6 million.

This compares to operating income of $53 million in the first quarter and $95 million in the first quarter. Second quarter of 2021.

Some of the optimism could be attributed to ICE Mortgage Technology’s second-quarter earnings performance, down just $10 million from the first quarter, $297 million vs. $307 million. Earnings a year ago he was $340 million.

On Intercontinental Exchange’s second quarter earnings call, Chief Financial Officer Warren Gardiner said: “These strong recurring revenues continue to outperform compared to the industry experienced. 40% reduction at the original volume.

If anything, the difficult mortgage environment has provided the company with an opportunity to have “more constructive conversations” with customers about the workflow of the origination process, Gardiner continued.

Production volumes in the quarter were similar to the second quarter of 2019, while revenues in the most recent period increased by nearly $100 million on a pro forma basis.

About updates Pending Deal to Acquire Black Knightthe Intercontinental Exchange only says it is scheduled to close in the first half of 2023.

Ben Jackson, president of Intercontinental Exchange and chairman of ICE Mortgage Technology, described the transaction more broadly as “the efficiencies that the combined company will bring to end consumers and other stakeholders across the mortgage ecosystem. I am very excited to continue to do so.”

The Data and Analytics segment reported a 21% increase in revenue in the first half of 2021 compared to the same period in 2021, added clients including Chase, as well as “many large independent mortgage banks and top three homebuilders. ,” said Jackson.

ICE Mortgage Technology’s second quarter recurring revenues were $160 million, up 18% from the prior year. At the same time, trading revenue fell 33% to $137 million.

When asked about customer cancellations, Gardiner reported, “There are very few lenders who have problems and may go out of business, but I’ve seen very few so far.”

Meanwhile, Black Knight reported a second quarter net profit of $40.3 million, down 89% from $364.4 million in the first quarter and up from $39.7 million. Second quarter of 2021.

“Our key performance in the second quarter was in line with expectations, as we continued to expand and grow our relationships with existing customers through cross-selling and renewals, win new customers and deliver innovative new services. We underscore the continued strength and resilience of our business solutions,” said Anthony Jabbour, who stepped down as CEO in May to become chairman, in a press release. “Our results further demonstrate our ability to deliver results despite an uncertain economic environment.”

Software Solutions business (MSP Services Platform and Empower Loan Origination Systems) operating income of $153.1 million in the first quarter compared to $141.6 million a year ago, down 100 million in the second quarter $54.8 million.

At the same time, data and analytics segment operating income was $13.7 million, down from $17.1 million on a quarterly basis, down from $15.2 million a year ago.