Walker & Dunlop Lowers Its Debt Costs

BETHESDA, Md., Nov. 16, 2017 /PRNewswire/ -- Walker & Dunlop, Inc. (NYSE: WD) (the "Company") announced today that it has completed a repricing of its senior secured term loan, reducing the spread to 300 basis points over 30-day LIBOR from 425 basis points over 30-day LIBOR.  The reduction in the interest rate will result in annual savings of approximately $2 million.

Chief Financial Officer Steve Theobald stated, "Walker & Dunlop's sustained top and bottom line growth and consistent financial performance since we raised this term debt in December 2013 has created strong market demand for our debt, allowing us to realize significant interest savings over the next few years with this repricing.  Our trailing 12-month adjusted EBITDA has grown from $57 million for December 31, 2013 to $181 million for September 30, 2017, reflective of the Company's core operating performance and profitable business model."

The outstanding principal balance of Walker & Dunlop's term loan was $166.5 million as of September 30, 2017.  There are no other significant changes to the debt or its related covenants as a result of the amendment.

About Walker & Dunlop
Walker & Dunlop (NYSE: WD), headquartered in Bethesda, Maryland, is one of the largest commercial real estate services and finance companies in the United States providing financing and investment sales to owners of multifamily and commercial properties. Walker & Dunlop, which is included in the S&P SmallCap 600 Index, has over 600 professionals in 28 offices across the nation with an unyielding commitment to client satisfaction.

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, a non-GAAP financial measure. The presentation of adjusted EBITDA 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 in addition to, and not as an alternative for, net income. Adjusted EBITDA represents net income before income taxes, interest expense on our term loan facility, and amortization and depreciation, adjusted for provision for credit losses net of write-offs, stock-based incentive compensation charges, and non-cash revenues such as gains attributable to MSRs. In addition, in 2013, adjusted EBITDA further excludes the impact of severance and lease restructuring charges related to our fourth quarter 2013 expense reduction efforts, early extinguishment of our prior term loan facility, and revenues from the termination fee related to the transfer of servicing for a portion of the Fannie Mae small loan portfolio that are not considered part of our ongoing operations. Because not all companies use identical calculations, our presentation of adjusted EBITDA may not be comparable to similarly titled measures of other companies. 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.

We use adjusted EBITDA 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 this non-GAAP measure, when read in conjunction with the Company's GAAP financials, provides 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 adjusted EBITDA has limitations in that it does not reflect all of the amounts associated with the Company's results of operations as determined in accordance with GAAP and that adjusted EBITDA should only be used to evaluate the Company's results of operations in conjunction with net income. For more information on adjusted EBITDA, refer to the section of this press release below titled "Adjusted Financial Metric Reconciliation to GAAP."

Forward Looking Statements
The statements regarding the anticipated interest savings contained in this press release may constitute forward-looking statements within the meaning of the federal securities laws. The statements concerning the anticipated savings reflect our current views 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 this press release.

While the statements regarding the anticipated savings 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 these statements to reflect changes in underlying assumptions or factors, new information or data, future events or other changes, except as required by applicable law.  A pre-payment of the senior secured term loan could impact our ability to achieve the anticipated annual interest savings described above.

For a further discussion of 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, as updated or supplemented by our 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.

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SOURCE Walker & Dunlop, Inc.