Real Matters Inc.

on Tuesday, May 7, 2024. I would now like to turn the conference over to Lynn Beauregard, Vice President of Investor Relations and Corporate Communications. Please go ahead.

Thank you, Operator, and good morning, everyone. Welcome to Real Matters Financial Results Conference call for the second quarter ended March 31, 2024. With me today are Real Matters Chief Executive Officer Brian Lang and Chief Financial Officer Rodrigo Pinto. This morning before market open, we issued a news release announcing our results for the three and six months ended March 31st, 2024. The release accompanying slide presentation as well as the financial statements and MD&A are posted in the investor section of our website at realmatters.com. During the call, we may make certain forward-looking statements which reflect the current expectations of management with respect to our business and the industry in which we operate. However, there are a number of risks, uncertainties, and other factors that could cause our results to differ materially from our expectations. Please see the slide entitled Cautionary Note Regarding Forward-Looking Information in the accompanying slide presentation for more details. You can also find additional information about these risks in the Risk Factors section of the company's Annual Information Form for the year end of September 30, 2023, which is available on CDAR+, and in the Investor Relations section of our website. As a reminder, we refer to non-GAAP measures in our slide presentation, including net revenue, net revenue margins, adjusted EBITDA, and adjusted EBITDA margins. Non-GAAP measures are described in our MD&A for the three and six months ended March 31, 2024, where you'll also find reconciliations to the nearest IFRS measures. With that, I'll turn it over to Brian.

Thank you, Lynn. Good morning, everyone, and thank you for joining us on the call today. I'll kick things off by going over the business highlights of the quarter. Rodrigo will then follow up with a brief discussion of the financial highlights before we take questions. Consolidated revenues increased 19% sequentially in the second quarter to $42.2 million and were up 12% year over year due to growth in our U.S. appraisal and Canadian segments. We delivered positive consolidated adjusted EBITDA of $.7 million in Q2, mainly due to strong operating leverage in our U.S. appraisal and Canadian segments. The U.S. 30-year fixed rate mortgage was down approximately 50 basis points in the second quarter, and we saw modest improvements in market volumes, albeit from historical lows. We estimate that second quarter U.S. mortgage market origination volumes increased 9% quarter over quarter and year-over-year. Second quarter U.S. appraisal purchase and refinance revenues outperformed the market. Purchase revenues were up 19% quarter-over-quarter compared to an estimated addressable market increase of 12% and refinance revenues were up 23% sequentially compared with an estimated addressable market decrease of 3%. We launched one new lender as well as a new channel with a Tier 1 lender in the second quarter. We also posted year-over-year market share increases with four of our top seven U.S. appraisal clients. We continued to leverage our platform to improve our margin profile in the second quarter, posting another new record high for U.S. appraisal net revenue margins of 28.3%, up 40 basis points from Q1. Modestly improved market conditions and market share gains increased the transaction volumes on our platform while we kept our operating expenses relatively flat, demonstrating the operating leverage in the business, which fueled our U.S. appraisal adjusted EBITDA increase of 65% quarter over quarter to $4.4 million. U.S. title segment revenues net revenues and adjusted EBITDA were relatively flat quarter over quarter as a decline in refinance origination revenues was offset by an increase in REO, home equity, diversified and other title revenues. We launched two new clients in U.S. title in the second quarter. The change in product mix of our U.S. title segment resulted in a decline in our net revenue margins to 44% in the second quarter from 47.3% in the first quarter of 2024. Our focus remains on adding new clients to our title platform in 2024. In line with the comments I made on our last conference call, the RFP cycle is active and we've moved forward as expected. In Canada, revenues were up 15% quarter over quarter on modestly improved market conditions and our cost base was flat, which resulted in a 26% quarter-over-quarter increase in adjusted EBITDA. We launched two new clients and one new channel in Canada in the second quarter. With that, I'll hand it over to Rodrigo.