PennyMac Financial Services Inc

For the period ended Sep 30, 2024. Filed Oct 29, 2024.

About this filing

A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.

Sep 30, 2024 · Filed Oct 29, 2024

PFSI$62.85-5.4%Stored close · as of Nov 10, 2026

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Contents

Consolidated Statements of Cash Flows

CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)


· · Nine months ended September 30,
· 2024 · 2023
		(in thousands)
Cash flow from operating activities
Net income	$206,934		$181,498
Adjustments to reconcile net income to net cash used in operating activities:
Net gains on loans held for sale at fair value	(595,324)		(397,178)
Change in fair value of mortgage servicing rights and mortgage servicing liabilities	758,158		70,608
Mortgage servicing rights hedging results	224,371		531,565
Accrual of unearned discounts on mortgage-backed securities	(29,219)		—
Capitalization of interest on loans held for sale	(362)		(678)
Amortization of debt issuance costs	21,860		14,925
Change in fair value of investment in common shares of PennyMac Mortgage Investment Trust	51		(1)
Results of real estate acquired in settlement in loans	(330)		(978)
Stock-based compensation expense	21,314		20,839
Provision (reversal of provision) for servicing advance losses	13,974		(7,603)
Depreciation and amortization	42,165		39,122
Amortization of operating lease right-of-use assets	10,256		13,311
Purchase of loans held for sale from PennyMac Mortgage Investment Trust	(57,502,461)		(50,812,386)
Origination of loans held for sale	(12,069,838)		(8,277,117)
Purchase of loans held for sale from non-affiliates	(1,933,158)		(1,507,346)
Purchase of loans from Ginnie Mae securities and early buyout investors	(2,379,099)		(2,045,156)
Sale to non-affiliates and principal payment of loans held for sale	70,706,054		60,061,205
Sale of loans held for sale to PennyMac Mortgage Investment Trust	191,250		—
Repurchase of loans subject to representations and warranties	(70,700)		(38,943)
Decrease in servicing advances	194,088		248,115
(Increase) decrease in receivable from PennyMac Mortgage Investment Trust	(5,451)		8,229
Sale of real estate acquired in settlement of loans	37,840		25,039
Increase in other assets	(42,377)		(47,226)
Decrease in accounts payable and accrued expenses	(106,125)		(24,641)
Decrease in operating lease liabilities	(13,359)		(16,992)
Decrease in payable to PennyMac Mortgage Investment Trust	(127,710)		(107,968)
Increase in income taxes payable	62,664		57,249
Net cash used in operating activities	(2,384,534)		(2,012,508)

Statements continue on the next page

(Continued)

CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)


· · Nine months ended September 30,
· 2024 · 2023
		(in thousands)
Cash flow from investing activities
(Increase) decrease in short-term investment	(657,666)		6,641
Purchase of principal-only stripped mortgage-backed securities	(935,356)		—
Repayment of principal-only stripped mortgage-backed securities	36,506		—
Sale of interest-only stripped mortgage-backed securities	121,520		98,066
Net settlement of derivative financial instruments used for hedging of mortgage servicing rights	(210,157)		(450,193)
Transfer of mortgage servicing rights relating to delinquent loans to Agency	—		305
Acquisition of capitalized software	(13,001)		(27,650)
Purchase of furniture, fixtures, equipment and leasehold improvements	(1,467)		(891)
Increase in margin deposits	(99,989)		(4,254)
Net cash used in investing activities	(1,759,610)		(377,976)
Cash flow from financing activities
Sale of assets under agreements to repurchase	77,065,706		61,277,758
Repurchase of assets sold under agreements to repurchase	(74,225,451)		(59,864,151)
Issuance of mortgage loan participation purchase and sale certificates	17,117,748		16,137,040
Repayment of mortgage loan participation purchase and sale certificates	(17,046,112)		(15,926,067)
Issuance of notes payable secured by mortgage servicing assets	725,000		880,000
Repayment of notes payable secured by mortgage servicing assets	(875,000)		(150,000)
Issuance of unsecured senior notes	650,000		—
Payment of debt issuance costs	(32,432)		(14,716)
Issuance of common stock by exercise of stock options	18,016		11,308
Payment of withholding taxes relating to stock-based compensation	(9,401)		(9,142)
Payment of dividends to holders of common stock	(36,487)		(31,206)
Repurchase of common stock	—		(71,575)
Net cash provided by financing activities	3,351,587		2,239,249
Net decrease in cash and restricted cash	(792,557)		(151,235)
Cash and restricted cash at beginning of period	938,371		1,328,539
Cash at end of period	$145,814		$1,177,304
Supplemental cash flow information:
Cash paid for interest	$571,461		$463,567
Cash paid (refunds received) for income taxes, net	$2,064		$(886)
Non-cash investing activities:
Mortgage servicing rights received from loan sales	$1,532,709		$1,299,992
Exchange of mortgage servicing spread for interest-only stripped mortgage-backed securities	$121,520		$98,066
Operating right-of-use assets recognized	$1,388		$2,893
Non-cash financing activities:
Issuance of common stock in settlement of directors' fees	$199		$102

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