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Altisource Asset Management(AAMC) - 2022 Q4 - Annual Report
AAMCAltisource Asset Management(AAMC)2023-03-26 16:00
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Financial Performance - Loan interest income for the year ended December 31, 2022, was 4.6million,comparedto4.6 million, compared to 0 in 2021[128] - Loan fee income for the year ended December 31, 2022, was 0.4million,withnoincomerecordedin2021[129]−TotalcashflowsfromcontinuingoperationsfortheyearendedDecember31,2022,were0.4 million, with no income recorded in 2021[129] - Total cash flows from continuing operations for the year ended December 31, 2022, were (65.5) million, compared to 30.4millionin2021[148]−AsofDecember31,2022,thecompanyhadcashandcashequivalentsof30.4 million in 2021[148] - As of December 31, 2022, the company had cash and cash equivalents of 10.7 million, down from 78.3millionin2021[141]−NetcashusedinoperatingactivitiesfortheyearendedDecember31,2022,wasprimarilyduetooriginationsandadditionalfundingsofheldforsaleloans,totalingsignificantongoingsalariesandbenefitspayments[150]−NetcashusedininvestingactivitiesfortheyearendedDecember31,2022,wasprimarilyforwebsitedevelopmentandthepurchaseofloansheldforinvestment,offsetbyprincipalpaymentsonthoseloans[151]−NetcashprovidedbyfinancingactivitiesduringtheyearendedDecember31,2022,wasmainlyrelatedtofundsborrowedandrepaidundertheCompany′slinesofcredit[152]Expenses−Salariesandemployeebenefitsincreasedto78.3 million in 2021[141] - Net cash used in operating activities for the year ended December 31, 2022, was primarily due to originations and additional fundings of held for sale loans, totaling significant ongoing salaries and benefits payments[150] - Net cash used in investing activities for the year ended December 31, 2022, was primarily for website development and the purchase of loans held for investment, offset by principal payments on those loans[151] - Net cash provided by financing activities during the year ended December 31, 2022, was mainly related to funds borrowed and repaid under the Company's lines of credit[152] Expenses - Salaries and employee benefits increased to 5.8 million in 2022 from 5.6millionin2021[130]−Legalfeesdecreasedto5.6 million in 2021[130] - Legal fees decreased to 4.3 million in 2022 from 6.9millionin2021,primarilyduetohighercostsin2021relatedtolitigation[131]−Generalandadministrativeexpensesroseto6.9 million in 2021, primarily due to higher costs in 2021 related to litigation[131] - General and administrative expenses rose to 3.5 million in 2022 from 2.6millionin2021,drivenbyincreasedinsuranceandsoftwarelicensefees[132]−Interestexpensewas2.6 million in 2021, driven by increased insurance and software license fees[132] - Interest expense was 1.3 million for the year ended December 31, 2022, compared to 0.1millionin2021[134]AssetsandLiabilities−Loansheldforsaleatfairvalueamountedto0.1 million in 2021[134] Assets and Liabilities - Loans held for sale at fair value amounted to 11.6 million as of December 31, 2022[143] - Loans held for investment at fair value were 83.1millionasofDecember31,2022[144]−TheSeriesApreferredstockisclassifiedastemporaryequity,withanaggregateredemptionrequestof83.1 million as of December 31, 2022[144] - The Series A preferred stock is classified as temporary equity, with an aggregate redemption request of 250.0 million received in 2020, which the Company could not fulfill due to lack of legally available funds[158] - The Company has elected the fair value option for its business purpose loans held for sale and investment, which are carried at estimated fair value, indicating a focus on accurate asset valuation[159] Internal Controls and Governance - Management assessed the effectiveness of internal control over financial reporting as of December 31, 2022, concluding that it was effective in providing reasonable assurance regarding the reliability of financial reporting[165] - The Company engaged a third-party consultant to assist in the documentation and integration of new internal control processes related to its ALG business line, reflecting ongoing growth and adaptation[168] - There were no changes in internal control over financial reporting that materially affected the Company during the year ended December 31, 2022, ensuring consistency in financial practices[169] - The Company plans to file a definitive Proxy Statement for the 2023 Annual Meeting of Stockholders within 120 days after December 31, 2022, indicating ongoing corporate governance compliance[173] Financial Stability - The Company had no off-balance sheet arrangements as of December 31, 2022 or 2021, indicating a stable financial position[154]