Walker & Dunlop Reports Fourth Quarter 2024 Financial Results

42% Increase in Net Income and Diluted Earnings per Share Generate Strong Finish to 2024

FOURTH QUARTER 2024 HIGHLIGHTS

• Total transaction volume of $13.4 billion, up 45% from Q4'23
• Total revenues of $341.5 million, up 24% from Q4'23
• Net income of $44.8 million and diluted earnings per share of $1.32, both up 42% from Q4'23
• Adjusted EBITDA⁽¹⁾ of $94.6 million, up 8% from Q4'23
• Adjusted core EPS⁽²⁾ of $1.34, down 6% from Q4'23
• Servicing portfolio of $135.3 billion as of December 31, 2024, up 4% from December 31, 2023
• Declared quarterly dividend of $0.67 per share for the first quarter 2025, up 3% from the fourth quarter of 2024

FULL-YEAR 2024 HIGHLIGHTS

• Total transaction volume of $39.9 billion, up 21% from 2023
• Total revenues of $1.1 billion, up 7% from 2023
• Net income of $108.2 million and diluted earnings per share of $3.19, both up less than 1% from 2023
• Adjusted EBITDA⁽¹⁾ of $328.5 million, up 9% from 2023
• Adjusted core EPS⁽²⁾ of $4.97, up 6% from 2023

Walker & Dunlop, Inc. (NYSE:WD) (the "Company," or "Walker & Dunlop") reported quarterly total transaction volume of $13.4 billion, up 45% from the fourth quarter of 2023, which drove total revenues of $341.5 million, up 24% year over year. Net income and diluted earnings per share for the fourth quarter of 2024 were both up 42% year over year to $44.8 million and $1.32, respectively. Adjusted EBITDA increased 8% to $94.6 million, reflective of the growth in total transaction volumes year over year. Adjusted core EPS, which primarily removes non-cash revenues and expenses, was down 6% year over year to $1.34. The Company's Board of Directors declared a dividend of $0.67 per share for the first quarter 2025.

"We had a strong finish to 2024, delivering impressive financial results across the board in the fourth quarter including $13.4 billion of total transaction volume, up 45% year over year," commented Walker & Dunlop Chaiman and CEO, Willy Walker. "A rebound in transaction activity, coupled with durable revenues from servicing and asset management, contributed to both year-over-year and sequential growth across almost every area of our business – resulting in $1.32 of diluted earnings per share, our highest quarterly EPS since the Great Tightening began. This strong finish to the year helped us close the significant gap to our annual financial targets after an exceedingly slow start to the year, testament to the talent, teamwork, and tenacity of the Walker & Dunlop team."

Walker continued, "Moving into 2025, we believe the worst of the Great Tightening is behind us and that W&D is extremely well positioned to meet the market needs over the next several years. We have invested in our people and client relationships, expanded our service offering, and harnessed the power of technology to generate market share gains and growth. And as the commercial real estate market recovers and transaction volumes rebound, our capital markets business, along with servicing and asset management, will generate strong financial results and shareholder returns."

DISCUSSION OF QUARTERLY RESULTS:

• Total transaction volumes increased 45% in the fourth quarter of 2024, reflecting the relative strength and continued demand throughout the multifamily market despite the continued volatility of interest rates during the fourth quarter of 2024.
• Transaction volumes with Fannie Mae and Freddie Mac, (collectively, the "GSE's), the largest providers of capital to the multifamily sector, increased 91% and 19%, respectively, year over year. Walker & Dunlop was ranked as the largest Fannie Mae lender for the sixth consecutive year and fourth largest Freddie Mac lender for 2024.
• HUD financing volumes declined in the fourth quarter of 2024, against our strongest quarter of the year in 2023 amidst high interest rates and elongated processing times. Walker & Dunlop ranked was as the second largest HUD lender for HUD's fiscal year ended September 30, 2024, up from the fifth largest HUD lender in 2023.
• The substantial increase in brokered volume was primarily the result of an expanding supply of capital from life insurance companies, banks, commercial mortgage-backed securities, and other private capital providers as the broad commercial real estate market continues to rebound.
• The increase in property sales volume was driven by additional liquidity supplied to the commercial real estate sector year over year, as higher interest rates and lower acquisition activity challenged the macroeconomic environment throughout 2023.

DISCUSSION OF QUARTERLY RESULTS:

• Our servicing portfolio continues to expand as a result of additional Agency debt financing volumes over the past 12 months, partially offset by principal paydowns and loan payoffs.
• During the fourth quarter of 2024, we added $1.2 billion of net loans to our servicing portfolio, and over the past 12 months, we added $4.8 billion of net loans to our servicing portfolio, almost all of which were Agency loans.
• $9.9 billion of Agency loans in our servicing portfolio are scheduled to mature over the next two years. These loans, with a weighted-average servicing fee of 26.2 basis points, represent only 8% of the total Agency loans in our portfolio.
• The mortgage servicing rights ("MSRs") associated with our servicing portfolio had a fair value of $1.4 billion as of both December 31, 2024 and 2023.
• Assets under management as of December 31, 2024 consisted of $15.9 billion of low-income housing tax credit ("LIHTC") funds, $1.5 billion of debt funds, and $1.0 billion of equity funds managed by WDIP. The 6% increase in assets under management was driven by increases in all three categories.

DISCUSSION OF QUARTERLY KEY PERFORMANCE METRICS:

• Walker & Dunlop net income and diluted EPS both increased 42% in the fourth quarter of 2024, primarily as a result of higher origination fees and MSR income from a 48% increase in Agency debt financing volume year over year. The increase in net income also drove the increase in return on equity to 10% for the fourth quarter of 2024.
• Adjusted EBITDA increased 8%, primarily due to increases in (i) origination fees, (ii) servicing fees, (iii) property sale broker fees, and (iv) other revenues and a greater benefit from fair value adjustments to contingent consideration liabilities. The increase in other revenues was driven by a gain on the sale of a portfolio of assets, a portion of which closed in the fourth quarter of 2024. These increases were partially offset by (i) decreases in investment management fees and investment banking revenues and (ii) an increase in variable compensation and (iii) an increase in other operating expenses.
• Adjusted core EPS, which excludes, among other items, the impacts of non-cash MSR income and amortization, the provision for credit losses, and acquisition-related costs, such as amortization of intangible assets, decreased to $1.34 in the fourth quarter of 2024 from $1.42 in the fourth quarter of 2023. The decrease was driven by increases in personnel and miscellaneous expenses and decreases in investment management fees and investment banking revenues in the fourth quarter of 2024 compared to the fourth quarter of 2023, partially offset by increases in origination fees, servicing fees, property sales broker fees, and other revenues.

DISCUSSION OF QUARTERLY KEY CREDIT METRICS:

• Our at-risk servicing portfolio, which is comprised of loans subject to a defined risk-sharing formula, increased primarily due to the level of Fannie Mae loans added to the portfolio during the past 12 months. We take credit risk exclusively on loans backed by multifamily assets and have no credit exposure to losses in any other sector of the commercial real estate lending market.
• As of December 31, 2024, six at-risk loans were in default with an aggregate unpaid principal balance ("UPB") of $41.7 million compared to three at-risk loans in default with an aggregate UPB of $27.2 million as of December 31, 2023. The collateral-based reserves on defaulted loans were $4.0 million and $2.8 million as of December 31, 2024, and 2023, respectively. The approximately 3,000 remaining loans in the at-risk servicing portfolio continue to exhibit strong credit quality, with low levels of delinquencies and strong operating performance of the underlying properties in the portfolio.
• During 2024, we received five loan repurchase requests from the GSEs totaling $87.3 million. Two of the requests came in the fourth quarter of 2024, both of which were existing defaulted loans within our at-risk portfolio. We indemnified three of the loans and repurchased the other two. We recorded a provision for credit losses of $4.5 million in the fourth quarter of 2024, primarily related to an increase in the estimated losses associated with these five repurchased and indemnified assets. As of December 31, 2024, the aggregate carrying value of these five repurchased and indemnified assets totaled $77.2 million, and we have collateral-based reserves of $13.4 million for those assets. Additionally, we incurred $8.5 million of repurchase-related costs, including critical repairs and maintenance, included in other expenses in the fourth quarter of 2024.

FOURTH QUARTER 2024

FINANCIAL RESULTS BY SEGMENT

Interest expense on corporate debt is determined at a consolidated corporate level and allocated to each segment proportionally based on each segment's use of that corporate debt. Income tax expense is determined at a consolidated corporate level and allocated to each segment proportionally based on each segment's income from operations, except for significant, one-time tax activities, which are allocated entirely to the segment impacted by the tax activity. The following details explain the changes in these expense items at a consolidated corporate level:

• Interest expense on corporate debt decreased 14% from the fourth quarter of 2023, primarily as a result of a decrease in interest rates on our term loan year over year, as our term loan was repriced lower in May 2024 and carries a floating interest rate.
• Income tax expense increased 6% from the fourth quarter of 2023, primarily driven by the 32% increase in income from operations, partially offset by several one-time tax benefits and an approximately 130 bps decrease in our blended state income tax rate year over year. Blended state income tax rates vary year to year based on several elements including changes in the activity within the various states.

CAPITAL MARKETS – DISCUSSION OF QUARTERLY RESULTS:

The Capital Markets segment includes our Agency lending, debt brokerage, property sales, appraisal and valuation services, investment banking, and housing market research businesses.

• The increase in origination fees during the fourth quarter of 2024 was primarily driven by the 56% increase in debt financing volume, partially offset by a decline in the origination fee margin resulting from the large increase in brokered debt financing volume. GSE debt financing volume increased 59%, while brokered debt financing grew 70% over the fourth quarter of last year.
• MSR income grew year over year due to a 48% increase in Agency debt financing volume and an increase in the Agency MSR rate. The Agency MSR rate increased primarily due to an increase in Fannie Mae volume as a percentage of Agency volume from 51% in the fourth quarter of 2023 to 66% in same quarter of 2024. Fannie Mae is our most-profitable debt financing product.
• Property sales broker fees increased year over year as a result of the 20% increase in property sales volumes, coupled with an increase in the property sale fee margin.
• The decrease in other revenues was primarily related to a decrease in investment banking revenues year over year.
• Personnel expense increased in the fourth quarter of 2024 primarily due to an increase in commission expenses related to higher origination fees and property sales broker fees and an increase in subjective bonus expense tied to overall company performance.
• The goodwill impairments in the fourth quarter of 2024 and 2023 were related to macroeconomic and transaction market conditions driving lower projected transaction activity and related cash flows from the GeoPhy acquisition. The fair value adjustments to contingent consideration liabilities were also impacted by further challenges in the forecasted macroeconomic conditions and transaction markets driving lower projected achievement of earnout hurdles tied to transaction activity and related revenues, resulting in a $38.1 million benefit in the fourth quarter of 2024 compared to a $48.5 million benefit in the fourth quarter of 2023.
• The increase in adjusted EBITDA was primarily the result of the increases in origination fees, property sales broker fees, and the net benefit of goodwill impairment and fair value adjustments to contingent consideration liabilities, partially offset by the increase in personnel and the decrease in other revenues.

SERVICING & ASSET MANAGEMENT – DISCUSSION OF QUARTERLY RESULTS:

The Servicing & Asset Management segment includes loan servicing, principal lending and investing, management of third-party capital invested in tax credit equity funds focused on the affordable housing sector and other commercial real estate, and real estate-related investment banking and advisory services.

• The $4.8 billion net increase in the servicing portfolio over the past 12 months was the principal driver of the growth in servicing fees year over year.
• Investment management fees decreased primarily due to a reduction in the accrual for investment management fees from our LIHTC funds that are driven by asset dispositions within the funds. Continued slowdowns in the property sales market resulted in lower than anticipated disposition revenues during the year.
• Other revenues increased, primarily as a result of the gain on sale described below, partially offset by a decrease in syndication fees resulting from a lower volume of capital syndicated into our LIHTC funds. During the fourth quarter of 2024, we entered into a contract to sell a portfolio of Affordable assets, including interests held by a part of the business known as Walker & Dunlop Affordable Preservation ("WDAP"), which were acquired as part of the Alliant acquisition. The sale of one of the assets closed during the fourth quarter, generating a gain on sale of $26.5 million and $21.3 million of adjusted EBITDA. The remaining assets are expected to close in the first half of 2025, as various consents are received. This was a discrete decision to realize a healthy return on this portfolio and exit a part of the business that was not part of our long-term plans, and in no way a reflection of our dedication to the Affordable sector, or our broader Affordable business.
• Personnel expense increased primarily due to increased salaries and benefits resulting from an increase in average segment headcount year over year combined with an increase in subjective bonus expense tied to overall company performance.
• Amortization and depreciation increased primarily due to the write-off of intangible assets associated with WDAP in connection with our agreement to sale interests in WDAP.
• The provision for credit losses in 2024 was primarily attributable to the loan repurchase and indemnification agreements we have with the GSEs, as noted above in our Key Credit Metrics, with no comparable activity in the prior year.
• The change in fair value adjustments to contingent consideration liabilities was primarily due to an $10.8 million contingent consideration revaluation related to Walker & Dunlop Affordable Equity ("WDAE") in the fourth quarter of 2024 with no comparable activity in the fourth quarter of 2023.
• Other operating expenses increased, primarily as a result of the repurchase-related expenses noted in the Key Credit Metrics section above and costs to sell the portfolio of Affordable assets noted above, with no comparable activity in the prior year.

CORPORATE – DISCUSSION OF QUARTERLY RESULTS:

The Corporate segment consists of corporate-level activities including accounting, information technology, legal, human resources, marketing, internal audit, and various other corporate groups ("support functions"). The Company does not allocate costs from these support functions to its other segments in presenting segment operating results.

• Other revenues, which primarily consist of gains and losses on equity-method investments, shifted from a gain in the fourth quarter of 2023 to a loss in the fourth quarter of 2024, due to the underperformance of several equity-method investments.
• The significant increase in personnel expense was primarily driven by an increase in subjective bonus expenses tied to company performance, coupled with an increase in salaries and benefits.

FULL-YEAR 2024

CONSOLIDATED OPERATING RESULTS

Interest expense on corporate debt is determined at a consolidated corporate level and allocated to each segment proportionally based on each segment's use of that corporate debt. Income tax expense is determined at a consolidated corporate level and allocated to each segment proportionally based on each segment's income from operations, except for significant, one-time tax activities, which are allocated entirely to the segment impacted by the tax activity. The following details explain the changes in these expense items at a consolidated corporate level:

• Interest expense on corporate debt increased 2% from 2023, primarily as a result of an increase in interest expense on borrowings to support our LIHTC operations, which increased year over year as the amount of borrowings increased.
• Income tax expense decreased $4.5 million, or 13%, from 2023, primarily driven by a 5% decrease in income from operations and due to several one-time tax benefits and an approximately 130 bps decrease in our blended state income tax rate year over year. Blended state income tax rates vary year to year based on several elements including changes in the activity within the various states.

DISCUSSION OF FULL-YEAR RESULTS:

• Total transaction volume increased 21% in 2024, primarily driven by a 37% increase in brokered debt financing volume, highlighted by a $1.2 billion transaction in the third quarter. Both GSE debt financing volume and property sales volume also increased by 11%, with an acceleration in multifamily property sales and debt financing activity throughout the year.
• The 9% increase in total expenses outpaced the 7% growth in total revenues for the year, driving a 5% decrease in income from operations. The decrease in income from operations was fully offset by a greater decrease in income tax expense as noted above. The growth in total revenues was primarily driven by increases in origination fees, MSR income, servicing fees, placement fees and other interest income, and other revenues, partially offset by declines in investment management fees and investment banking revenues.
• The increase in total expenses was primarily driven by increases in personnel expenses and amortization and depreciation and increases in the provision (benefit) for credit losses and other expenses associated with loan repurchases and indemnifications in 2024, with no related activity in 2023. The provision for credit losses and other expenses attributable to repurchased and indemnified loans totaled $24.7 million in 2024. The net benefit for credit losses in 2023 related primarily to an annual update of our historical loss rate.
• Adjusted EBITDA increased 9% primarily due to increased origination fees, servicing fees, placement fees and other interest income and other revenues and a decrease in net write-offs, partially offset by decreases in investment management fees and investment banking revenues and increases in personnel and other operating expenses. The aforementioned gain on sale of a portfolio of Affordable assets was a significant part of the increase in other revenues.
• Diluted EPS increased less than 1% year over year, compared to a 6% increase in our adjusted core EPS year over year. Adjusted core EPS reflects the year-over-year growth of our recurring revenue streams but excludes the decrease in non-cash MSR income and the increase to non-cash provision for credit loss expenses, while diluted EPS incorporates the impact of those non-cash items. Additionally, net write-offs, a reduction for adjusted core EPS decreased, resulting in increased adjusted core EPS. This reduction for net write-offs is not included in diluted EPS.

FULL-YEAR 2024

FINANCIAL RESULTS BY SEGMENT

CAPITAL MARKETS – DISCUSSION OF FULL-YEAR RESULTS:

• The increase in origination fees was largely driven by a 25% increase in debt financing volume year over year, partially offset by a decline in our origination fee rate related to the shift in the mix of our debt financing volume towards brokered debt financing volume.
• MSR income grew largely as a result of a 10% increase in Agency debt financing volume year over year, partially offset by a lower Agency MSR rate due to a lower increase in Fannie Mae debt financing volumes than other Agency volumes. Fannie Mae is our most-profitable debt financing product.
• Property sales broker fees primarily increased year over year as a result of the 11% increase in property sales volumes.
• The decrease in other revenues was primarily related to the closing of a $7.5 million transaction in 2023, the largest investment banking deal in the Company's history, with no comparable transaction in 2024.
• Personnel expense increased year over year primarily as a result of higher commission costs related to the increase in origination fees during 2024 and an increase in subjective bonus expense tied to company performance, partially offset by a decrease in salaries and benefits due to lower average segment headcount.
• The goodwill impairments in 2024 and 2023 were related only to the GeoPhy acquisition, which was impacted by macroeconomic and transaction market conditions driving lower projected transaction activity and related cash flows. The fair value adjustments to contingent consideration liabilities were also impacted by challenges in the forecasted macroeconomic conditions and transaction markets driving lower projected achievement of earnout hurdles, tied primarily to transaction activity and related revenues, resulting in a $39.5 million benefit in 2024 related to several acquisitions, compared to a $62.5 million benefit in 2023 related exclusively to the GeoPhy acquisition.

SERVICING & ASSET MANAGEMENT – DISCUSSION OF FULL-YEAR RESULTS:

• The $4.8 billion net increase in the servicing portfolio over the past 12 months was the principal driver of the growth in servicing fees year over year.
• Investment management fees decreased primarily due to a reduction in the accrual for investment management fees from our LIHTC funds that are driven by asset dispositions within the funds. Continued slowdowns in the property sales market resulted in lower than anticipated disposition revenues for 2024.
• Placement fees and other interest income increased largely as a result of higher placement fees earned on deposits due to higher short-term interest rates and an increased average escrow balance in 2024.
• Other revenues increased, primarily as a result of the aforementioned gain on the sale of a portfolio of assets by our affordable business, partially offset by a decrease in syndication fees resulting from a lower volume of capital syndicated into our LIHTC funds.
• Personnel expense increased primarily due to increased salaries and benefits resulting from an increase in average segment headcount year over year combined with an increase in subjective bonus expense tied to company performance.
• The provision for credit losses in 2024 was primarily attributable to the loan repurchase and indemnification agreements we have with the GSEs, with no comparable activity in 2023.
• The change in fair value adjustments to contingent consideration liabilities was primarily due to an $10.8 million contingent consideration revaluation related to WDAE in the fourth quarter of 2024, with no comparable activity in 2023.
• Other operating expenses increased, primarily as a result of legal fees and other costs associated with property improvements and operating costs on assets controlled through loan repurchase or indemnification, with no comparable activity in the prior year.

CORPORATE – DISCUSSION OF FULL-YEAR RESULTS:

• Total revenues increased as a result of higher interest income earned on our corporate and fund cash balances.
• The 19% increase in personnel expense was primarily driven by an increase in subjective bonus expenses tied to company performance, coupled with an increase in salaries and benefits.
• The increase in other operating expenses was primarily the result of increased legal fees due to higher transaction activity, increased travel and entertainment as we hosted an all company gathering in 2024 with no comparable event in 2023 due to our cost reduction efforts, increased rent expense due to renewing and extending several office leases, and normal growth in software related expenses year over year.

CAPITAL SOURCES AND USES

On February 12, 2025, the Company's Board of Directors declared a dividend of $0.67 per share for the first quarter of 2025, a 3% increase year over year, and the seventh consecutive annual increase in the Company's dividend since it was initiated in 2018, representing cumulative growth of 168% over the past seven years. The dividend will be paid on March 14, 2025, to all holders of record of the Company's restricted and unrestricted common stock as of February 28, 2025.

In May 2024, the Company entered into a second amendment to the existing credit agreement that, among other things, decreased the interest rate of the incremental $200 million borrowing by 0.75% per annum, to Term SOFR plus 2.25% per annum, and combined the incremental term loan with the initial term loan to create a single fungible $800 million senior secured term loan. The Company is continuously evaluating the most effective capital structure and may choose to opportunistically access the debt markets in the future.

On February 14, 2024, our Board of Directors authorized the repurchase of up to $75.0 million of the Company's outstanding common stock over a twelve-month period ending February 23, 2025 (the "2024 Share Repurchase Program"). We have not repurchased any shares of common stock under the 2024 Share Repurchase Program.

On February 12, 2025, our Board of Directors authorized the repurchase of up to $75.0 million of the Company's outstanding common stock over a twelve-month period starting from February 21, 2025 ("2025 Share Repurchase Program").

Any purchases made pursuant to the 2025 Share Repurchase Program will be made in the open market or in privately negotiated transactions, from time to time, as permitted by federal securities laws and other legal requirements. The timing, manner, price and amount of any repurchases will be determined by the Company in its discretion and will be subject to economic and market conditions, stock price, applicable legal requirements and other factors. The repurchase program may be suspended or discontinued at any time.

CONFERENCE CALL INFORMATION

Listeners can access the Company's quarterly conference call for more information regarding our financial results via the dial-in number and webcast link below. Presentation materials related to the conference call will be posted to the Investor Relations section of the Company's website prior to the call. An audio replay will also be available on the Investor Relations section of the Company's website, along with the presentation materials.

ABOUT WALKER & DUNLOP

Walker & Dunlop (NYSE:WD) is one of the largest commercial real estate finance and advisory services firms in the United States. Our ideas and capital create communities where people live, work, shop, and play. The diversity of our people, breadth of our brand and technological capabilities make us one of the most insightful and client-focused firms in the commercial real estate industry.

NON-GAAP FINANCIAL MEASURES

To supplement our financial statements presented in accordance with United States generally accepted accounting principles ("GAAP"), the Company uses adjusted EBITDA, adjusted core net income, and adjusted core EPS, which are non-GAAP financial measures. The presentation of these non-GAAP financial measures is not intended to be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP. When analyzing our operating performance, readers should use adjusted EBITDA, adjusted core net income, and adjusted core EPS in addition to, and not as an alternative for, net income and diluted EPS.

Adjusted core net income and adjusted core EPS represent net income adjusted for amortization and depreciation, provision (benefit) for credit losses, net write-offs based on the final resolution of the defaulted loans or collateral, the fair value of expected net cash flows from servicing, net, the income statement impact from periodic revaluation and accretion associated with contingent consideration liabilities related to acquired companies, goodwill impairment and other adjustments. Adjusted EBITDA represents net income before income taxes, interest expense on our corporate debt, and amortization and depreciation, adjusted for provision (benefit) for credit losses, net write-offs based on the final resolution of the defaulted loans or collateral, stock-based compensation expense, the fair value of expected net cash flows from servicing, net, the write-off of the unamortized balance of premium associated with the repayment of a portion of our corporate debt, goodwill impairment, and contingent consideration liability fair value adjustments when the fair value adjustment is a triggering event for a goodwill impairment assessment. Furthermore, adjusted EBITDA is not intended to be a measure of free cash flow for our management's discretionary use, as it does not reflect certain cash requirements such as tax and debt service payments. The amounts shown for adjusted EBITDA may also differ from the amounts calculated under similarly titled definitions in our debt instruments, which are further adjusted to reflect certain other cash and non-cash charges that are used to determine compliance with financial covenants. Because not all companies use identical calculations, our presentation of adjusted EBITDA, adjusted core net income and adjusted core EPS may not be comparable to similarly titled measures of other companies.

We use adjusted EBITDA, adjusted core net income, and adjusted core EPS to evaluate the operating performance of our business, for comparison with forecasts and strategic plans and for benchmarking performance externally against competitors. We believe that these non-GAAP measures, when read in conjunction with the Company's GAAP financial information, provide useful information to investors by offering:

• the ability to make more meaningful period-to-period comparisons of the Company's on-going operating results;
• the ability to better identify trends in the Company's underlying business and perform related trend analyses; and
• a better understanding of how management plans and measures the Company's underlying business.

We believe that these non-GAAP financial measures have limitations in that they do not reflect all of the amounts associated with the Company's results of operations as determined in accordance with GAAP and that these non-GAAP financial measures should only be used to evaluate the Company's results of operations in conjunction with the Company's GAAP financial information. For more information on adjusted EBITDA, adjusted core net income, and adjusted core EPS, refer to the section of this press release below titled "Adjusted Financial Measure Reconciliation to GAAP" and "Adjusted Financial Measure Reconciliation to GAAP By Segment."

FORWARD-LOOKING STATEMENTS

Some of the statements contained in this press release may constitute forward-looking statements within the meaning of the federal securities laws. Forward-looking statements relate to expectations, projections, plans and strategies, anticipated events or trends and similar expressions concerning matters that are not historical facts. In some cases, you can identify forward-looking statements by the use of forward-looking terminology such as "may," "will," "should," "expects," "intends," "plans," "anticipates," "believes," "estimates," "predicts," or "potential" or the negative of these words and phrases or similar words or phrases that are predictions of or indicate future events or trends and which do not relate solely to historical matters. You can also identify forward-looking statements by discussions of strategy, plans, or intentions.

The forward-looking statements contained in this press release reflect our current views about future events and are subject to numerous known and unknown risks, uncertainties, assumptions and changes in circumstances that may cause actual results to differ significantly from those expressed or contemplated in any forward-looking statement.

While forward-looking statements reflect our good faith projections, assumptions and expectations, they are not guarantees of future results. Furthermore, we disclaim any obligation to publicly update or revise any forward-looking statement to reflect changes in underlying assumptions or factors, new information, data or methods, future events or other changes, except as required by applicable law. Factors that could cause our results to differ materially include, but are not limited to: (1) general economic conditions and multifamily and commercial real estate market conditions, (2) changes in interest rates, (3) regulatory and/or legislative changes to Freddie Mac, Fannie Mae or HUD, (4) our ability to retain and attract loan originators and other professionals, (5) success of our various investments funded with corporate capital, and (6) changes in federal government fiscal and monetary policies, including any constraints or cuts in federal funds allocated to HUD for loan originations.

For a further discussion of these and other factors that could cause future results to differ materially from those expressed or contemplated in any forward-looking statements, see the section titled "Risk Factors" in our most recent Annual Report on Form 10-K and any updates or supplements in subsequent Quarterly Reports on Form 10-Q and our other filings with the SEC. Such filings are available publicly on our Investor Relations web page at www.walkerdunlop.com.