Onity Group Inc.

Please stand by. Your program is about to begin. Good day, everyone, and welcome to the Onity Group's first quarter earnings and business update conference call. At this time, all participants are in a listen-only mode. Later, you will have the opportunity to ask questions during the question and answer session. You may register to ask questions by pressing the star and one on your telephone keypad. You may withdraw your question by pressing star 2. Please note this call is being recorded, and I will be standing by should you need any assistance. It is now my pleasure to turn the conference over to Valerie Hertel, Vice President of Investor Relations. Please go ahead.

Thank you. Good morning and welcome to Onity Group's first quarter 2025 earnings call. Please note that our earnings release and presentation are available on our website at onitygroup.com. Speaking on the call will be Chair, President, and Chief Executive Officer, Glenn Messina, and Chief Financial Officer, Sean O'Neill. As a reminder, our comments today may contain forward-looking statements made pursuant to the safe harbor provisions of the Federal Securities Laws. These statements may be identified by reference to a future period or by use of forward-looking terminology and address matters that are uncertain. Forward-looking statements speak only as of the date they are made and involve assumptions, risks, and uncertainties, including those described in our SEC filings. In the past, actual results have differed materially from those suggested by forward-looking statements, and this may happen again. In addition, the presentation and our comments contain references to non-GAAP financial measures, such as adjusted pre-tax income. We believe these non-GAAP measures provide a useful supplement to discussions and analysis of our financial condition because they are measures that management uses to assess the performance of our operations and allocate resources. Non-GAAP measures should be viewed in addition to and not as an alternative for the company's reported GAAP results. A reconciliation of these non-GAAP measures to their most directly comparable GAAP measures and management's reasons for including them may be found in the press release and the appendix to the investor presentation. Now, I would like to turn the call over to Glenn Messina.

Thank you, Valerie. Good morning, everyone, and thanks for joining our call. We're looking forward to sharing a few highlights for the first quarter, as well as review our strategy and financial objectives to deliver long-term value for our shareholders. Let's get started on slide three. I want to start with three key themes today. First, we're delivering on our 2025 operating priority to accelerate growth in originations volume and total servicing UPB. Second, our growth in book value and adjusted ROE performance demonstrate that our strategy is sound and execution is on track. And third, we believe our balanced business positions us for success in high and low interest rate environments. Let's turn to slide four to review a few highlights for the quarter. Despite unpredictable market conditions, we delivered strong financial performance in the first quarter with adjusted pre-tax income of $25 million and annualized adjusted ROE of 22%, which exceeds our guidance. Gap net income attributable to common shareholders of $21 million or $2.50 per share fully diluted reflects an annualized return on equity of 19% and is above consensus. Average servicing UPB of $305 billion for the quarter is up $13 billion versus the first quarter of 2024. Total servicing additions of $17 billion is down from the first quarter of 2024, primarily due to lower subservicing additions related to the timing of bulk boardings. However, owned MSR additions more than doubled versus the first quarter 24. And finally, book value per share was up approximately 4% versus Q1 24 and up approximately 2% versus year end 24. We're pleased with our results for the quarter, which reflects the strength of our business and solid execution from our team. Let's turn to slide five to discuss how we're positioned for the balance of 2025.