Question-and-Answer Session
Operator
(Operator Instructions)
Your first question comes from Jeetil Patel — Deutsche Bank Securities.
Jeetil Patel — Deutsche Bank Securities
On your loans business it is about a $75-80 million annualized run rate on a revenue basis. Can you talk about what type of style or size and scale of business your current infrastructure and headcount can support right now just to try to understand what kind of margin leverage you have as you move ahead over the next couple of years?
Second on the exchange side can you talk about what types of EBITDA margins you are carrying currently in the business and what was the peak if you go back a couple of years on the exchange side of the equation?
Doug Lebda
Let me answer that at a high level first and then turn it over to Matt to take you through the numbers that we can disclose. On LTL we are constantly in the process of matching the headcount and the infrastructure to the right level of lead volumes. We have had significant headcount reductions in the past. I think though the thing I would say going forward we would expect our leverage would improve because of the application of technology.
We are looking at putting new technology inside the call center, putting new technology to aid our sales process to make sure calls get transferred and people get followed up with appropriately through the very long process from qualification form to actually closing. We are looking for ways to partner with much bigger technology providers on outsourcing and working with others on the processing front.
Then on the exchange side the same thing is true there. The biggest note on the exchange piece is the biggest driver of that margin would be the marketing margin. Those margins have come down and where we’ve been in this cycle over the past couple of years of cutting our marketing spend because online placements in particular go unprofitable as your conversion rates on lenders go down and your margins go down on the lenders. We’ve been in a bit of a negative cycle on the marketing piece. However that is where we believe that by diversifying and cross selling other products on the back of the Lending Tree qualification form by having more of web 2.0 site to engage consumers in a much broader way we can improve our revenue per customer and get our margins back to something that is acceptable where we can then invest money back in marketing to drive some customers in.
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