United States
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
Current Report
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (date of earliest event reported):
February 18, 2015
Fidelity National Financial, Inc.
(Exact name of Registrant as Specified in its Charter)
001-32630
(Commission File Number)
Delaware (State or Other Jurisdiction of Incorporation or Organization) | 16-1725106 (IRS Employer Identification Number) | |
601 Riverside Avenue
Jacksonville, Florida 32204
(Addresses of Principal Executive Offices)
(904) 854-8100
(Registrant's Telephone Number, Including Area Code)
(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
o | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | |
o | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | |
o | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | |
x | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) | |
Item 2.02. | Results of Operations and Financial Condition | |
On February 18, 2015, Fidelity National Financial, Inc. issued an earnings release announcing its financial results for the Fourth Quarter of 2014. The information in this Current Report is being furnished and shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended or otherwise subject to the liabilities of that Section. The information in this Current Report shall not be incorporated by reference into any registration statement or other document pursuant to the Securities Act of 1933, as amended.
A copy of the FNF Core and FNFV earnings releases are attached as Exhibit 99.1 and Exhibit 99.2, respectively.
Item 9.01. | Financial Statements and Exhibits | |
(c) Exhibits
Exhibit | Description | ||||
99.1 | Press release announcing FNF Core Fourth Quarter 2014 Earnings. | ||||
99.2 | Press release announcing FNFV Fourth Quarter 2014 Earnings. | ||||
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
Fidelity National Financial, Inc. | |||||
Date: | February 18, 2015 | By: | /s/ Anthony J. Park | ||
Name: | Anthony J. Park | ||||
Title: | Chief Financial Officer | ||||
EXHIBIT INDEX
Exhibit | Description | ||||
99.1 | Press release announcing FNF Core Fourth Quarter 2014 Earnings. | ||||
99.2 | Press release announcing FNFV Fourth Quarter 2014 Earnings. | ||||
FNF Core Reports Fourth Quarter 2014 Adjusted EPS of $0.50; Adjusted Pre-Tax Title Margin of 14.1% and Black Knight Adjusted EBITDA Margin of 43.0% Jacksonville, Fla. - (February 18, 2015) - Fidelity National Financial, Inc. today reported the operating results of its core segment (NYSE:FNF), a leading provider of title insurance, technology and transaction services to the real estate and mortgage industries, for the three and twelve-month periods ended December 31, 2014.
• | Total revenue of approximately $1.7 billion in the fourth quarter versus $1.4 billion in the fourth quarter of 2013 |
• | Adjusted fourth quarter net earnings of $144 million versus adjusted net earnings of $81 million for the fourth quarter of 2013 |
• | Adjusted fourth quarter core diluted EPS of $0.50 versus adjusted core diluted EPS of $0.34 in the fourth quarter of 2013 |
• | Fourth quarter core free cash flow provided of $139 million versus $47 million provided in the fourth quarter of 2013 |
Title
• | Approximately $1.5 billion in total revenue, adjusted pre-tax earnings of $207 million and adjusted pre-tax title margin of 14.1% for the fourth quarter versus approximately $1.4 billion in total revenue, adjusted pre-tax earnings of $147 million and an adjusted pre-tax title margin of 10.8% in the fourth quarter of 2013 |
• | Adjusted pre-tax title margin of 14.1% was a 330 basis point improvement over the fourth quarter 2013 adjusted pre-tax title margin of 10.8% |
• | ServiceLink generated $211 million in revenue, adjusted EBITDA of $27 million, an adjusted EBITDA margin of 13%, adjusted pre-tax earnings of $23 million and an adjusted pre-tax margin of 11% for the fourth quarter |
• | Open orders per day of 7,175 for the fourth quarter versus 6,206 open orders per day for the fourth quarter of 2013 |
• | Closed orders per day of 5,302 for the fourth quarter versus 4,873 closed orders per day for the fourth quarter of 2013 |
• | Fourth quarter purchase orders opened and closed increased by 11% and 9%, respectively, versus the fourth quarter of 2013; purchase orders opened and closed were both essentially flat versus the fourth quarter of 2013 excluding ServiceLink default related purchase orders |
• | Fourth quarter national commercial title revenue of $166 million, a 14% increase from the fourth quarter of 2013, driven by a 15% improvement in the commercial fee per file and a 1% decrease in closed orders; open commercial orders decreased by 6% over the prior year |
• | Overall fourth quarter average fee per file of $2,131, a 2% increase over the fourth quarter of 2013 |
• | Title claims paid of $78 million, a decrease of $22 million, or 22%, from the fourth quarter of 2013 |
Title Orders
Direct Orders Opened * | Direct Orders Closed * | |||||||
Month | / (% Purchase) | / (% Purchase) | ||||||
October 2014 | 176,000 | 53% | 115,000 | 60% | ||||
November 2014 | 133,000 | 52% | 97,000 | 56% | ||||
December 2014 | 143,000 | 51% | 122,000 | 54% | ||||
Fourth Quarter 2014 | 452,000 | 52% | 334,000 | 57% | ||||
1
Direct Orders Opened * | Direct Orders Closed * | |||||||
Month | / (% Purchase) | / (% Purchase) | ||||||
October 2013 | 156,000 | 54% | 112,000 | 55% | ||||
November 2013 | 124,000 | 54% | 94,000 | 55% | ||||
December 2013 | 111,000 | 56% | 101,000 | 58% | ||||
Fourth Quarter 2013 | 391,000 | 55% | 307,000 | 56% | ||||
* Includes an immaterial number of non-purchase and non-refinance orders
Open | Closed | Commercial | |||||||||||||
Commercial | Commercial | Revenue | Commercial | ||||||||||||
Orders | Orders | (In millions) | Fee Per File | ||||||||||||
Fourth Quarter 2014 | 18,100 | 12,700 | $166 | $13,100 | |||||||||||
Fourth Quarter 2013 | 19,300 | 12,800 | $146 | $11,400 | |||||||||||
- The preceding table only includes commercial activity from FNF’s commercial offices in the national commercial division and does not attempt to capture potential commercial activity in our local offices.
Black Knight
• | Total revenue of $220 million, led by Servicing Technology revenue of approximately $155 million |
• | Revenue growth of 12% for the fourth quarter compared to the prior year period legacy LPS results, led by Data and Analytics, RealEC and Servicing Technology |
• | Adjusted EBITDA of $96 million and adjusted EBITDA margin of 43.0%, a 70 basis point sequential margin improvement from the third quarter of 2014 |
“This was a strong finish to a great year for our title insurance business,” said Chairman William P. Foley, II. “Despite a continued sluggish real estate market, we achieved a 14.1% pre-tax title margin for the fourth quarter, more than a 14.3% pre-tax title margin for the last three quarters of 2014 and a 12.5% pre-tax title margin for the full-year 2014. Overall, we are proud of the financial results we posted in our title business in 2014 and we remain confident in our ability to generate a 15%-20% pre-tax title margin in an improving real estate market.
“Black Knight had another impressive quarter, generating 12% revenue growth and an adjusted EBITDA margin of 43%, a 70 basis point sequential margin improvement from the third quarter of 2014. We remain excited about the organic revenue growth opportunity at Black Knight, as the sales pipeline is strong across our technology and data and analytics businesses as we enter 2015. We also announced the initial filing of a Black Knight IPO registration statement with the SEC in December and are working towards having Black Knight operate as an FNF majority-owned, publicly-traded company in 2015."
Conference Call
We will host a call with investors and analysts to discuss fourth quarter 2014 FNF Core results on Thursday, February 19, 2015, beginning at 11:00 a.m. Eastern Time. A live webcast of the conference call will be available on the Events and Multimedia page of the FNF Investor Relations website at www.fnf.com. The conference call replay will be available via webcast through the FNF Investor Relations website at www.fnf.com. The telephone replay will be available from 1:00 p.m. Eastern time on February 19, 2015, through February 26, 2015, by dialing 800-475-6701 (USA) or 320-365-3844 (International). The access code will be 351178.
About FNF
Fidelity National Financial, Inc. (FNF) is organized into two groups, FNF Core (NYSE: FNF) and FNF Ventures (NYSE: FNFV). Through our Core operations, FNF is a leading provider of title insurance, technology and transaction services to the real estate and mortgage industries. FNF is the nation’s largest title insurance company through its title insurance underwriters - Fidelity National Title, Chicago Title, Commonwealth Land Title, Alamo Title and National Title of New York - that collectively issue more title insurance policies than any other title company in the United States. FNF also provides industry-leading mortgage technology solutions and transaction services, including MSP®, the leading residential mortgage servicing technology platform in the U.S., through its majority-owned subsidiaries, Black Knight Financial Services, LLC and ServiceLink Holdings, LLC. In addition, in our FNFV group, we own majority and minority equity investment stakes in a number of entities, including
2
American Blue Ribbon Holdings, LLC, J. Alexander’s, LLC , Ceridian HCM, Inc., Fleetcor Technologies, Inc. and Digital Insurance, Inc. More information about FNF can be found at www.fnf.com.
Use of Non-GAAP Financial Information
Generally Accepted Accounting Principles (GAAP) is the term used to refer to the standard framework of guidelines for financial accounting. GAAP includes the standards, conventions, and rules accountants follow in recording and summarizing transactions and in the preparation of financial statements. In addition to reporting financial results in accordance with GAAP, the Company has provided non-GAAP financial measures, which it believes are useful to help investors better understand its financial performance, competitive position and prospects for the future. These non-GAAP measures include earnings before interest, taxes and depreciation and amortization (EBITDA), adjusted earnings before interest, taxes and depreciation and amortization (Adjusted EBITDA), adjusted earnings before interest, taxes and depreciation as a percent of adjusted revenue (Adjusted EBITDA margin), adjusted net earnings, adjusted EPS and free cash flow.
Any non-GAAP measures should be considered in context with the GAAP financial presentation and should not be considered in isolation or as a substitute for GAAP net earnings. Further, FNF's non-GAAP measures may be calculated differently from similarly titled measures of other companies. Reconciliations of these non-GAAP measures to related GAAP measures are provided below.
Black Knight IPO Information
The proposed Black Knight initial public offering will be made only be means of a prospectus. A copy of the preliminary prospectus may be obtained, when available, from the book-running manager(s) of the proposed offering.
A registration statement on Form S-1 relating to the proposed offering has been filed with the SEC, but has not yet become effective. The shares to be registered may not be sold nor may offers to buy be accepted prior to the time when the registration statement becomes effective. Copies of the registration statement can be accessed through the SEC's website at www.sec.gov. This press release shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of these securities in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.
Forward-Looking Statements and Risk Factors
This press release contains forward-looking statements that involve a number of risks and uncertainties. Statements that are not historical facts, including statements regarding our expectations, hopes, intentions or strategies regarding the future are forward-looking statements. Forward-looking statements are based on management's beliefs, as well as assumptions made by, and information currently available to, management. Because such statements are based on expectations as to future financial and operating results and are not statements of fact, actual results may differ materially from those projected. We undertake no obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise. No assurance can be given as to the value of Black Knight's common stock, the price at which its common stock may be offered in the proposed offering, the trading price of such common stock after the proposed offering or whether a liquid market for such common stock will develop or be maintained. The risks and uncertainties which forward-looking statements are subject to include, but are not limited to: changes in general economic, business and political conditions, including changes in the financial markets; weakness or adverse changes in the level of real estate activity, which may be caused by, among other things, high or increasing interest rates, a limited supply of mortgage funding or a weak U. S. economy; our potential inability to find suitable acquisition candidates, acquisitions in lines of business that will not necessarily be limited to our traditional areas of focus, or difficulties in integrating acquisitions; our dependence on distributions from our title insurance underwriters as a main source of cash flow; significant competition that our operating subsidiaries face; compliance with extensive government regulation of our operating subsidiaries.
This press release should be read in conjunction with the press release filed for the results of FNFV on this same date as well as the risks detailed in the “Statement Regarding Forward-Looking Information,” “Risk Factors” and other sections of the Company’s Form 10-Q,10-K and other filings with the Securities and Exchange Commission.
SOURCE: Fidelity National Financial, Inc.
CONTACT: Daniel Kennedy Murphy, Senior Vice President and Treasurer, 904-854-8120, dkmurphy@fnf.com
3
FIDELITY NATIONAL FINANCIAL CORE
FOURTH QUARTER SEGMENT INFORMATION
(In millions, except order information in thousands)
(Unaudited)
Total FNF Core | Title | BKFS | FNF Core Corporate and Other | |||||||||||||
Three Months Ended | ||||||||||||||||
December 31, 2014 | ||||||||||||||||
Direct title premiums | $ | 478 | $ | 478 | $ | — | $ | — | ||||||||
Agency title premiums | 494 | 494 | — | — | ||||||||||||
Escrow, title related and other fees | 679 | 461 | 220 | (2 | ) | |||||||||||
Total title and escrow | 1,651 | 1,433 | 220 | (2 | ) | |||||||||||
Interest and investment income | 33 | 33 | — | — | ||||||||||||
Realized gains and losses | 4 | 4 | — | — | ||||||||||||
Total revenue | 1,688 | 1,470 | 220 | (2 | ) | |||||||||||
Personnel costs | 588 | 483 | 99 | 6 | ||||||||||||
Agent commissions | 373 | 373 | — | — | ||||||||||||
Other operating expenses | 379 | 340 | 38 | 1 | ||||||||||||
Depreciation and amortization | 83 | 36 | 46 | 1 | ||||||||||||
Claim loss expense | 59 | 59 | — | — | ||||||||||||
Interest expense | 29 | — | 8 | 21 | ||||||||||||
Total expenses | 1,511 | 1,291 | 191 | 29 | ||||||||||||
Pre-tax earnings from continuing operations | $ | 177 | $ | 179 | $ | 29 | $ | (31 | ) | |||||||
Non-GAAP adjustments before taxes | ||||||||||||||||
Realized (gain) loss, net adjustment | $ | (4 | ) | $ | (4 | ) | $ | — | $ | — | ||||||
Deferred revenue adjustment for BKFS | 3 | — | 3 | — | ||||||||||||
Transaction costs related to acquisition of LPS | 6 | 3 | 3 | — | ||||||||||||
Severance costs related to acquisition of LPS | 2 | 2 | — | — | ||||||||||||
Synergy bonus accrual | 6 | 2 | 3 | 1 | ||||||||||||
Payroll accrual | 3 | — | 3 | — | ||||||||||||
Other legal matters | 2 | 1 | 1 | — | ||||||||||||
Purchase price amortization | 46 | 24 | 22 | — | ||||||||||||
Total non-GAAP adjustments before taxes | $ | 64 | $ | 28 | $ | 35 | $ | 1 | ||||||||
Adjusted pre-tax earnings from continuing operations | $ | 241 | $ | 207 | $ | 64 | $ | (30 | ) | |||||||
Adjusted pre-tax margin from continuing operations | 14.3 | % | 14.1 | % | 28.7 | % | — | |||||||||
Purchase price amortization | (46 | ) | (24 | ) | (22 | ) | — | |||||||||
Interest expense | 29 | — | 8 | 21 | ||||||||||||
Depreciation and amortization | 83 | 36 | 46 | 1 | ||||||||||||
Adjusted EBITDA | $ | 307 | $ | 219 | $ | 96 | $ | (8 | ) | |||||||
Adjusted EBITDA margin | 18.2 | % | 14.9 | % | 43.0 | % | — | |||||||||
ServiceLink non-GAAP reconciliations: | ||||||||||||||||
ServiceLink pre-tax loss | $ | (7 | ) | |||||||||||||
Depreciation & Amortization | 25 | |||||||||||||||
ServiceLink EBITDA | $ | 18 | ||||||||||||||
Severance and other LPS acquisition costs | 7 | |||||||||||||||
Other adjustments | 2 | |||||||||||||||
4
ServiceLink Adjusted EBITDA | $ | 27 | ||||||||||||||
ServiceLink pre-tax loss | $ | (7 | ) | |||||||||||||
Purchase price amortization | 21 | |||||||||||||||
Severance and other LPS acquisition costs | 7 | |||||||||||||||
Other adjustments | 2 | |||||||||||||||
ServiceLink adjusted pre-tax earnings | $ | 23 | ||||||||||||||
5
FIDELITY NATIONAL FINANCIAL CORE
FOURTH QUARTER SEGMENT INFORMATION
(In millions, except order information in thousands)
(Unaudited)
Total FNF Core | Title | BKFS | FNF Core Corporate and Other | |||||||||||||
Three Months Ended | ||||||||||||||||
December 31, 2014 | ||||||||||||||||
Pre-tax earnings from continuing operations | $ | 177 | $ | 179 | $ | 29 | $ | (31 | ) | |||||||
Income tax expense | 70 | 67 | 4 | (1 | ) | |||||||||||
Earnings from equity investments | 1 | 1 | — | — | ||||||||||||
Non-controlling interests | 8 | (6 | ) | 14 | — | |||||||||||
Net earnings attributable to FNF Group common shareholders | $ | 100 | $ | 119 | $ | 11 | $ | (30 | ) | |||||||
EPS attributable to FNF Group common shareholders - basic | $ | 0.37 | $ | 0.43 | $ | 0.04 | $ | (0.11 | ) | |||||||
EPS attributable to FNF Group common shareholders - diluted | $ | 0.35 | $ | 0.42 | $ | 0.03 | $ | (0.10 | ) | |||||||
FNF Group weighted average shares - basic | 276 | |||||||||||||||
FNF Group weighted average shares - diluted | 286 | |||||||||||||||
Net earnings attributable to FNF Group common shareholders | $ | 100 | $ | 119 | $ | 11 | $ | (30 | ) | |||||||
Total non-GAAP, pre-tax adjustments | 64 | 28 | 35 | 1 | ||||||||||||
Noncontrolling interest on non-GAAP adjustments | (4 | ) | (5 | ) | 1 | — | ||||||||||
Income taxes on non-GAAP adjustments | (16 | ) | (7 | ) | (9 | ) | — | |||||||||
Total non-GAAP adjustments | 44 | 16 | 27 | 1 | ||||||||||||
Adjusted net earnings attributable to FNF Group common shareholders | $ | 144 | $ | 135 | $ | 38 | $ | (29 | ) | |||||||
Adjusted EPS attributable to FNF Group common shareholders - diluted | $ | 0.50 | $ | 0.47 | $ | 0.13 | $ | (0.10 | ) | |||||||
Direct orders opened (000's) | 452 | 452 | ||||||||||||||
Direct orders closed (000's) | 334 | 334 | ||||||||||||||
Fee per file | $ | 2,131 | $ | 2,131 | ||||||||||||
Actual title claims paid | $ | 78 | $ | 78 | ||||||||||||
Cash flows provided by operations: | $ | 158 | ||||||||||||||
Non-GAAP adjustments: | ||||||||||||||||
Transaction costs related to acquisition of LPS | 6 | |||||||||||||||
Synergy bonus payment | 11 | |||||||||||||||
Severance costs related to acquisition of LPS | 2 | |||||||||||||||
Total non-GAAP adjustments | 19 | |||||||||||||||
Adjusted cash flows from operations | 177 | |||||||||||||||
Capital expenditures | 38 | |||||||||||||||
Free cash flow | $ | 139 | ||||||||||||||
6
FIDELITY NATIONAL FINANCIAL CORE
FOURTH QUARTER SEGMENT INFORMATION
(In millions, except order information in thousands)
(Unaudited)
Total FNF Core | Title | FNF Core Corporate and Other | ||||||||||
Three Months Ended | ||||||||||||
December 31, 2013 | ||||||||||||
Direct title premiums | $ | 423 | $ | 423 | $ | — | ||||||
Agency title premiums | 573 | 573 | — | |||||||||
Escrow, title related and other fees | 351 | 340 | 11 | |||||||||
Total title and escrow | 1,347 | 1,336 | 11 | |||||||||
Interest and investment income | 28 | 30 | (2 | ) | ||||||||
Realized gains and losses | 7 | 8 | (1 | ) | ||||||||
Total revenue | 1,382 | 1,374 | 8 | |||||||||
Personnel costs | 460 | 445 | 15 | |||||||||
Agent commissions | 437 | 437 | — | |||||||||
Other operating expenses | 267 | 251 | 16 | |||||||||
Depreciation and amortization | 18 | 16 | 2 | |||||||||
Claim loss expense | 70 | 70 | — | |||||||||
Interest expense | 16 | — | 16 | |||||||||
Total expenses | 1,268 | 1,219 | 49 | |||||||||
Pre-tax earnings from continuing operations | $ | 114 | $ | 155 | $ | (41 | ) | |||||
Non-GAAP adjustments before taxes | ||||||||||||
Realized (gain) loss, net adjustment | $ | (7 | ) | $ | (8 | ) | $ | 1 | ||||
Transaction costs related to acquisition of LPS | 8 | 2 | 6 | |||||||||
Executive severance | 9 | — | 9 | |||||||||
Premium tax adjustment | (5 | ) | (5 | ) | — | |||||||
Purchase price amortization | 3 | 3 | — | |||||||||
Total non-GAAP adjustments before taxes | $ | 8 | $ | (8 | ) | $ | 16 | |||||
Adjusted pre-tax earnings from continuing operations | $ | 122 | $ | 147 | $ | (25 | ) | |||||
Adjusted pre-tax margin from continuing operations | 8.9 | % | 10.8 | % | — | |||||||
Purchase price amortization | (3 | ) | (3 | ) | — | |||||||
Interest expense | 16 | — | 16 | |||||||||
Depreciation and amortization | 18 | 16 | 2 | |||||||||
Adjusted EBITDA | $ | 153 | $ | 160 | $ | (7 | ) | |||||
Adjusted EBITDA margin | 11.1 | % | 11.7 | % | — | |||||||
7
FIDELITY NATIONAL FINANCIAL CORE
FOURTH QUARTER SEGMENT INFORMATION
(In millions, except order information in thousands)
(Unaudited)
Total FNF Core | Title | FNF Core Corporate and Other | ||||||||||
Three Months Ended | ||||||||||||
December 31, 2013 | ||||||||||||
Pre-tax earnings from continuing operations | $ | 114 | $ | 155 | $ | (41 | ) | |||||
Income tax expense | 40 | 61 | (21 | ) | ||||||||
Earnings from equity investments | — | 1 | (1 | ) | ||||||||
Earnings (loss) from discontinued operations, net of tax | 1 | 1 | — | |||||||||
Net earnings attributable to Old FNF common shareholders | $ | 75 | $ | 96 | $ | (21 | ) | |||||
EPS attributable to Old FNF common shareholders - basic | $ | 0.33 | $ | 0.42 | $ | (0.09 | ) | |||||
EPS attributable to Old FNF common shareholders - diluted | $ | 0.32 | $ | 0.41 | $ | (0.09 | ) | |||||
Old FNF weighted average shares - basic | 230 | |||||||||||
Old FNF weighted average shares - diluted | 235 | |||||||||||
Net earnings attributable to Old FNF common shareholders | $ | 75 | $ | 96 | $ | (21 | ) | |||||
Total non-GAAP, pre-tax adjustments | 8 | (8 | ) | 16 | ||||||||
Income taxes on non-GAAP adjustments | (2 | ) | 3 | (5 | ) | |||||||
Total non-GAAP adjustments | 6 | (5 | ) | 11 | ||||||||
Adjusted net earnings attributable to Old FNF common shareholders | $ | 81 | $ | 91 | $ | (10 | ) | |||||
Adjusted EPS attributable to Old FNF common shareholders - diluted | $ | 0.34 | $ | 0.39 | $ | (0.04 | ) | |||||
Direct orders opened (000's) | 391 | 391 | ||||||||||
Direct orders closed (000's) | 307 | 307 | ||||||||||
Fee per file | $ | 2,082 | $ | 2,082 | ||||||||
Actual title claims paid | $ | 100 | $ | 100 | ||||||||
Cash flows provided by operations: | $ | 46 | ||||||||||
Non-GAAP adjustments: | ||||||||||||
Transaction costs related to acquisition of LPS | 5 | |||||||||||
Executive severance payment | 9 | |||||||||||
Total non-GAAP adjustments | 14 | |||||||||||
Adjusted cash flows from operations | 60 | |||||||||||
Capital expenditures | 13 | |||||||||||
Free cash flow | $ | 47 | ||||||||||
8
FIDELITY NATIONAL FINANCIAL CORE
YTD SEGMENT INFORMATION
(In millions, except order information in thousands)
(Unaudited)
Total FNF Core | Title | BKFS | FNF Core Corporate and Other | |||||||||||||
Twelve Months Ended | ||||||||||||||||
December 31, 2014 | ||||||||||||||||
Direct title premiums | $ | 1,727 | $ | 1,727 | $ | — | $ | — | ||||||||
Agency title premiums | 1,944 | 1,944 | — | — | ||||||||||||
Escrow, title related and other fees | 2,694 | 1,855 | 852 | (13 | ) | |||||||||||
Total title and escrow | 6,365 | 5,526 | 852 | (13 | ) | |||||||||||
Interest and investment income | 121 | 122 | — | (1 | ) | |||||||||||
Realized gains and losses | 4 | 4 | — | — | ||||||||||||
Total revenue | 6,490 | 5,652 | 852 | (14 | ) | |||||||||||
Personnel costs | 2,370 | 1,896 | 449 | 25 | ||||||||||||
Agent commissions | 1,471 | 1,471 | — | — | ||||||||||||
Other operating expenses | 1,557 | 1,370 | 199 | (12 | ) | |||||||||||
Depreciation and amortization | 336 | 145 | 188 | 3 | ||||||||||||
Claim loss expense | 228 | 228 | — | — | ||||||||||||
Interest expense | 122 | — | 31 | 91 | ||||||||||||
Total expenses | 6,084 | 5,110 | 867 | 107 | ||||||||||||
Pre-tax earnings from continuing operations | $ | 406 | $ | 542 | $ | (15 | ) | $ | (121 | ) | ||||||
Non-GAAP adjustments before taxes | ||||||||||||||||
Realized (gain) loss, net adjustment | $ | (4 | ) | $ | (4 | ) | $ | — | $ | — | ||||||
Deferred revenue adjustment for BKFS | 13 | — | 13 | — | ||||||||||||
Transaction costs related to acquisition of LPS | 62 | 35 | 53 | (26 | ) | |||||||||||
Severance costs related to acquisition of LPS | 47 | 20 | 27 | — | ||||||||||||
Synergy bonus accrual | 73 | 30 | 31 | 12 | ||||||||||||
Premium tax settlement | (8 | ) | (8 | ) | — | — | ||||||||||
Payroll accrual | 3 | — | 3 | — | ||||||||||||
Other legal matters | 23 | 1 | 12 | 10 | ||||||||||||
Purchase price amortization | 183 | 88 | 95 | — | ||||||||||||
Total non-GAAP adjustments before taxes | $ | 392 | $ | 162 | $ | 234 | $ | (4 | ) | |||||||
Adjusted pre-tax earnings from continuing operations | $ | 798 | $ | 704 | $ | 219 | $ | (125 | ) | |||||||
Adjusted pre-tax margin from continuing operations | 12.3 | % | 12.5 | % | 25.3 | % | — | |||||||||
Purchase price amortization | (183 | ) | (88 | ) | (95 | ) | — | |||||||||
Interest expense | 122 | — | 31 | 91 | ||||||||||||
Depreciation and amortization | 336 | 145 | 188 | 3 | ||||||||||||
Adjusted EBITDA | $ | 1,073 | $ | 761 | $ | 343 | $ | (31 | ) | |||||||
Adjusted EBITDA margin | 16.5 | % | 13.5 | % | 39.7 | % | — | |||||||||
9
FIDELITY NATIONAL FINANCIAL CORE
YTD SEGMENT INFORMATION
(In millions, except order information in thousands)
(Unaudited)
Total FNF Core | Title | BKFS | FNF Core Corporate and Other | |||||||||||||
Twelve Months Ended | ||||||||||||||||
December 31, 2014 | ||||||||||||||||
Pre-tax earnings from continuing operations | $ | 406 | $ | 542 | $ | (15 | ) | $ | (121 | ) | ||||||
Income tax expense | 162 | 196 | (7 | ) | (27 | ) | ||||||||||
Earnings from equity investments | 4 | 4 | — | — | ||||||||||||
Earnings (loss) from discontinued operations, net of tax | (1 | ) | (1 | ) | — | — | ||||||||||
Non-controlling interests | (68 | ) | (42 | ) | (26 | ) | — | |||||||||
Net earnings attributable to FNF common shareholders | $ | 315 | $ | 391 | $ | 18 | $ | (94 | ) | |||||||
EPS attributable to Old FNF common shareholders - basic | $ | 0.37 | $ | 0.50 | $ | (0.04 | ) | $ | (0.09 | ) | ||||||
EPS attributable to Old FNF common shareholders - diluted | $ | 0.36 | $ | 0.49 | $ | (0.03 | ) | $ | (0.10 | ) | ||||||
EPS attributable to FNF Group common shareholders - basic | $ | 0.77 | $ | 0.90 | $ | 0.13 | $ | (0.26 | ) | |||||||
EPS attributable to FNF Group common shareholders - diluted | $ | 0.75 | $ | 0.87 | $ | 0.11 | $ | (0.23 | ) | |||||||
Old FNF weighted average shares - basic | 138 | |||||||||||||||
Old FNF weighted average shares - diluted | 142 | |||||||||||||||
FNF Group weighted average shares - basic | 138 | |||||||||||||||
FNF Group weighted average shares - diluted | 142 | |||||||||||||||
Net earnings attributable to FNF common shareholders | $ | 315 | $ | 391 | $ | 18 | $ | (94 | ) | |||||||
Total non-GAAP, pre-tax adjustments | 392 | 162 | 234 | (4 | ) | |||||||||||
Noncontrolling interest on non-GAAP adjustments | (123 | ) | (54 | ) | (69 | ) | — | |||||||||
Income taxes on non-GAAP adjustments | (95 | ) | (39 | ) | (58 | ) | 2 | |||||||||
Total non-GAAP adjustments | 174 | 69 | 107 | (2 | ) | |||||||||||
Adjusted net earnings attributable to FNF common shareholders* | $ | 489 | $ | 460 | $ | 125 | $ | (96 | ) | |||||||
Adjusted EPS attributable to FNF common shareholders - diluted* | $ | 1.72 | $ | 1.62 | $ | 0.44 | $ | (0.34 | ) | |||||||
* Adjusted EPS is presented as if Old FNF common shareholders and FNF Group common shareholders combined. | ||||||||||||||||
Direct orders opened (000's) | 1,914 | 1,914 | ||||||||||||||
Direct orders closed (000's) | 1,319 | 1,319 | ||||||||||||||
Fee per file | $ | 2,014 | $ | 2,014 | ||||||||||||
Actual title claims paid | $ | 304 | $ | 304 | ||||||||||||
Cash flows provided by operations: | $ | 453 | ||||||||||||||
Non-GAAP adjustments: | ||||||||||||||||
Transaction costs related to acquisition of LPS | 54 | |||||||||||||||
Severance costs related to acquisition of LPS | 47 | |||||||||||||||
Synergy bonus payment | 67 | |||||||||||||||
Premium tax settlement | 15 | |||||||||||||||
10
Other legal matters | 8 | |||||||||||||||
Total non-GAAP adjustments | 191 | |||||||||||||||
Adjusted cash flows from operations | 644 | |||||||||||||||
Capital expenditures | 120 | |||||||||||||||
Free cash flow | $ | 524 | ||||||||||||||
11
FIDELITY NATIONAL FINANCIAL CORE
YTD SEGMENT INFORMATION
(In millions, except order information in thousands)
(Unaudited)
Total FNF Core | Title | FNF Core Corporate and Other | ||||||||||
Twelve Months Ended | ||||||||||||
December 31, 2013 | ||||||||||||
Direct title premiums | $ | 1,800 | $ | 1,800 | $ | — | ||||||
Agency title premiums | 2,352 | 2,352 | — | |||||||||
Escrow, title related and other fees | 1,650 | 1,597 | 53 | |||||||||
Total title and escrow | 5,802 | 5,749 | 53 | |||||||||
Interest and investment income | 123 | 127 | (4 | ) | ||||||||
Realized gains and losses | 18 | 18 | — | |||||||||
Total revenue | 5,943 | 5,894 | 49 | |||||||||
Personnel costs | 1,882 | 1,845 | 37 | |||||||||
Agent commissions | 1,789 | 1,789 | — | |||||||||
Other operating expenses | 1,189 | 1,096 | 93 | |||||||||
Depreciation and amortization | 68 | 65 | 3 | |||||||||
Claim loss expense | 291 | 291 | — | |||||||||
Interest expense | 68 | — | 68 | |||||||||
Total expenses | 5,287 | 5,086 | 201 | |||||||||
Pre-tax earnings from continuing operations | $ | 656 | $ | 808 | $ | (152 | ) | |||||
Non-GAAP adjustments before taxes | ||||||||||||
Realized (gain) loss, net adjustment | $ | (18 | ) | $ | (18 | ) | $ | — | ||||
Deferred revenue adjustment for BKFS | — | — | — | |||||||||
Transaction costs related to acquisition of LPS | 17 | 2 | 15 | |||||||||
Executive severance | 9 | — | 9 | |||||||||
Premium tax adjustment | (5 | ) | (5 | ) | — | |||||||
Other legal matters | 20 | — | 20 | |||||||||
Purchase price amortization | 12 | 12 | — | |||||||||
Total non-GAAP adjustments before taxes | $ | 35 | $ | (9 | ) | $ | 44 | |||||
Adjusted pre-tax earnings from continuing operations | $ | 691 | $ | 799 | $ | (108 | ) | |||||
Adjusted pre-tax margin from continuing operations | 11.7 | % | 13.6 | % | — | |||||||
Purchase price amortization | (12 | ) | (12 | ) | — | |||||||
Interest expense | 68 | — | 68 | |||||||||
Depreciation and amortization | 68 | 65 | 3 | |||||||||
Adjusted EBITDA | $ | 815 | $ | 852 | $ | (37 | ) | |||||
Adjusted EBITDA margin | 13.8 | % | 14.5 | % | — | |||||||
12
FIDELITY NATIONAL FINANCIAL CORE
YTD SEGMENT INFORMATION
(In millions, except order information in thousands)
(Unaudited)
Total FNF Core | Title | FNF Core Corporate and Other | ||||||||||
Twelve Months Ended | ||||||||||||
December 31, 2013 | ||||||||||||
Pre-tax earnings from continuing operations | $ | 656 | $ | 808 | $ | (152 | ) | |||||
Income tax expense | 237 | 297 | (60 | ) | ||||||||
Earnings from equity investments | 4 | 5 | (1 | ) | ||||||||
Earnings from discontinued operations, net of tax | 2 | 2 | — | |||||||||
Non-controlling interests | 4 | 4 | — | |||||||||
Net earnings attributable to FNF common shareholders | $ | 421 | $ | 514 | $ | (93 | ) | |||||
EPS attributable to Old FNF common shareholders - basic | $ | 1.83 | $ | 2.23 | $ | (0.40 | ) | |||||
EPS attributable to Old FNF common shareholders - diluted | $ | 1.79 | $ | 2.19 | $ | (0.40 | ) | |||||
Old FNF weighted average shares - basic | 230 | |||||||||||
Old FNF weighted average shares - diluted | 235 | |||||||||||
Net earnings attributable to FNF common shareholders | $ | 421 | $ | 514 | $ | (93 | ) | |||||
Total non-GAAP, pre-tax adjustments | 35 | (9 | ) | 44 | ||||||||
Income taxes on non-GAAP adjustments | (11 | ) | 3 | (14 | ) | |||||||
Total non-GAAP adjustments | 24 | (6 | ) | 30 | ||||||||
Adjusted net earnings attributable to Old FNF common shareholders | $ | 445 | $ | 508 | $ | (63 | ) | |||||
Adjusted EPS attributable to Old FNF common shareholders - diluted | $ | 1.89 | $ | 2.16 | $ | (0.27 | ) | |||||
Direct orders opened (000's) | 2,181 | 2,181 | ||||||||||
Direct orders closed (000's) | 1,708 | 1,708 | ||||||||||
Fee per file | $ | 1,660 | $ | 1,660 | ||||||||
Actual title claims paid | $ | 403 | $ | 403 | ||||||||
Cash flows provided by operations: | $ | 354 | ||||||||||
Non-GAAP adjustments: | ||||||||||||
Transaction costs related to acquisition of LPS | 17 | |||||||||||
Executive severance payment | 9 | |||||||||||
Other legal matters | 20 | |||||||||||
Total non-GAAP adjustments | 46 | |||||||||||
Adjusted cash flows from operations | 400 | |||||||||||
Capital expenditures | 67 | |||||||||||
Free cash flow | $ | 333 | ||||||||||
13
FIDELITY NATIONAL FINANCIAL CORE
QUARTERLY OPERATING STATISTICS
(Unaudited)
Q4 2014 | Q3 2014 | Q2 2014 | Q1 2014 | Q4 2013 | Q3 2013 | Q2 2013 | Q1 2013 | |||||||||||||||||||||||||
Quarterly Open Orders ('000's except % data) | ||||||||||||||||||||||||||||||||
Total open orders* | 452 | 481 | 514 | 469 | 391 | 474 | 672 | 643 | ||||||||||||||||||||||||
Total open orders per day* | 7.2 | 7.5 | 8.0 | 7.7 | 6.2 | 7.4 | 10.5 | 10.5 | ||||||||||||||||||||||||
Purchase % of open orders | 52 | % | 60 | % | 60 | % | 55 | % | 55 | % | 56 | % | 42 | % | 38 | % | ||||||||||||||||
Refinance % of open orders | 48 | % | 40 | % | 40 | % | 45 | % | 45 | % | 44 | % | 58 | % | 62 | % | ||||||||||||||||
Total closed orders* | 334 | 348 | 342 | 295 | 307 | 410 | 504 | 487 | ||||||||||||||||||||||||
Total closed orders per day* | 5.3 | 5.4 | 5.3 | 4.8 | 4.9 | 6.4 | 7.9 | 8.0 | ||||||||||||||||||||||||
Purchase % of closed orders | 57 | % | 62 | % | 61 | % | 52 | % | 56 | % | 50 | % | 40 | % | 31 | % | ||||||||||||||||
Refinance % of closed orders | 43 | % | 38 | % | 39 | % | 48 | % | 44 | % | 50 | % | 60 | % | 69 | % | ||||||||||||||||
Commercial (millions, except orders in '000's) | ||||||||||||||||||||||||||||||||
Revenue | $ | 166 | $ | 136 | $ | 115 | $ | 104 | $ | 146 | $ | 120 | $ | 112 | $ | 88 | ||||||||||||||||
Open Orders | 18.1 | 21.4 | 22.2 | 19.6 | 19.3 | 19.9 | 20.3 | 18.7 | ||||||||||||||||||||||||
Closed Orders | 12.7 | 12.8 | 20.3 | 10.2 | 12.8 | 12.6 | 12.3 | 10.6 | ||||||||||||||||||||||||
Total Fee Per File | ||||||||||||||||||||||||||||||||
Fee per file | $ | 2,131 | $ | 2,066 | $ | 1,982 | $ | 1,858 | $ | 2,082 | $ | 1,807 | $ | 1,562 | $ | 1,373 | ||||||||||||||||
Residential and local commercial fee per file | $ | 1,699 | $ | 1,739 | $ | 1,750 | $ | 1,559 | $ | 1,676 | $ | 1,562 | $ | 1,373 | $ | 1,219 | ||||||||||||||||
National commercial fee per file | $ | 13,100 | $ | 10,600 | $ | 9,800 | $ | 10,200 | $ | 11,400 | $ | 9,500 | $ | 9,100 | $ | 8,300 | ||||||||||||||||
Total Staffing | ||||||||||||||||||||||||||||||||
Total field operations employees | 9,900 | 10,200 | 10,200 | 10,300 | 9,900 | 10,600 | 12,000 | 12,000 | ||||||||||||||||||||||||
FNT Only Quarterly Operating Statistics ('000's except fee per file and staffing) | ||||||||||||||||||||||||||||||||
Total open orders* | 354 | 385 | 403 | 349 | 331 | 391 | 516 | 481 | ||||||||||||||||||||||||
Total open orders per day* | 5.6 | 6.0 | 6.3 | 5.7 | 5.3 | 6.1 | 8.1 | 7.9 | ||||||||||||||||||||||||
Purchase % of open orders | 60 | % | 69 | % | 71 | % | 71 | % | 65 | % | 68 | % | 56 | % | 58 | % | ||||||||||||||||
Refinance % of open orders | 40 | % | 31 | % | 29 | % | 29 | % | 35 | % | 32 | % | 44 | % | 42 | % | ||||||||||||||||
Total closed orders* | 273 | 282 | 272 | 219 | 263 | 323 | 387 | 354 | ||||||||||||||||||||||||
Total closed orders per day* | 4.3 | 4.4 | 4.3 | 3.6 | 4.2 | 5.0 | 6.0 | 5.8 | ||||||||||||||||||||||||
Purchase % of closed orders | 63 | % | 70 | % | 71 | % | 67 | % | 66 | % | 64 | % | 52 | % | 44 | % | ||||||||||||||||
Refinance % of closed orders | 37 | % | 30 | % | 29 | % | 33 | % | 34 | % | 36 | % | 48 | % | 56 | % | ||||||||||||||||
Fee per file | 2,382 | 2,306 | 2,227 | 2,151 | 2,260 | 2,028 | 1,747 | 1,537 | ||||||||||||||||||||||||
Total tile field operations employees | 8,700 | 8,900 | 8,700 | 8,600 | 8,900 | 9,300 | 10,100 | 9,900 | ||||||||||||||||||||||||
ServiceLink Only Quarterly Operating Statistics ('000's except fee per file and staffing) | ||||||||||||||||||||||||||||||||
Total Open Orders* | 98 | 96 | 111 | 120 | 60 | 83 | 156 | 162 | ||||||||||||||||||||||||
Total open orders per day* | 1.6 | 1.5 | 1.7 | 2.0 | 1.0 | 1.3 | 2.4 | 2.7 | ||||||||||||||||||||||||
Purchase % of open orders | 23 | % | 23 | % | 20 | % | 7 | — | — | — | — | |||||||||||||||||||||
Refinance % of open orders | 77 | % | 77 | % | 80 | % | 93 | % | 100 | % | 100 | % | 100 | % | 100 | % | ||||||||||||||||
Total closed orders | 61 | 66 | 70 | 76 | 44 | 87 | 117 | 133 | ||||||||||||||||||||||||
Total closed orders per day* | 1.0 | 1.0 | 1.1 | 1.2 | 0.7 | 1.4 | 1.8 | 2.2 | ||||||||||||||||||||||||
Purchase % of closed orders | 26 | % | 24 | % | 18 | % | 6 | — | — | — | — | |||||||||||||||||||||
Refinance % of closed orders | 74 | % | 76 | % | 82 | % | 94 | % | 100 | % | 100 | % | 100 | % | 100 | % | ||||||||||||||||
Fee per file | 1,027 | 1,052 | 1,038 | 1,009 | 1,013 | 989 | 951 | 936 | ||||||||||||||||||||||||
Total ServiceLink operating employees | 1,200 | 1,300 | 1,500 | 1,700 | 970 | 1,300 | 1,900 | 2,100 | ||||||||||||||||||||||||
* Includes an immaterial number of non-purchase and non-refinance orders
14
FIDELITY NATIONAL FINANCIAL CORE
SUMMARY BALANCE SHEET INFORMATION
(In millions)
FNF Core December 31, 2014 | FNF Core December 31, 2013 | |||||||||
(Unaudited) | (Unaudited) | |||||||||
Cash and investment portfolio | $ | 4,360 | $ | 5,235 | ||||||
Goodwill | 4,514 | 1,438 | ||||||||
Title plant | 393 | 370 | ||||||||
Total assets | 11,944 | 8,028 | ||||||||
Notes payable | 2,702 | 983 | ||||||||
Reserve for title claim losses | 1,621 | 1,636 | ||||||||
Secured trust deposits | 622 | 588 | ||||||||
Redeemable non-controlling interests | 717 | — | ||||||||
Non-redeemable non-controlling interests | (60 | ) | 10 | |||||||
Total equity and redeemable non-controlling interests | 5,272 | 3,896 | ||||||||
Total equity attributable to common shareholders | 4,615 | 3,886 | ||||||||
FNF Core December 31, 2014 | FNFV December 31, 2014 | Consolidated December 31, 2014 | Consolidated December 31, 2013 | |||||||||||||||||
(Unaudited) | (Unaudited) | (Unaudited) | ||||||||||||||||||
Cash and investment portfolio | $ | 4,360 | $ | 1,009 | $ | 5,369 | $ | 5,761 | ||||||||||||
Goodwill | 4,514 | 206 | 4,720 | 1,901 | ||||||||||||||||
Title plant | 393 | — | 393 | 370 | ||||||||||||||||
Total assets | 11,944 | 1,923 | 13,867 | 10,529 | ||||||||||||||||
Notes payable | 2,702 | 124 | 2,826 | 1,323 | ||||||||||||||||
Reserve for title claim losses | 1,621 | — | 1,621 | 1,636 | ||||||||||||||||
Secured trust deposits | 622 | — | 622 | 588 | ||||||||||||||||
Redeemable non-controlling interests | 717 | — | 717 | — | ||||||||||||||||
Non-redeemable non-controlling interests | (60 | ) | 137 | 77 | 474 | |||||||||||||||
Total equity and redeemable non-controlling interests | 5,272 | 1,515 | 6,787 | 5,535 | ||||||||||||||||
Total equity attributable to common shareholders | 4,615 | 1,378 | 5,993 | 5,061 | ||||||||||||||||
15
FIDELITY NATIONAL FINANCIAL, INC.
CONSOLIDATED SUMMARY OF EARNINGS
(In millions)
(Unaudited)
Three Months Ended | Twelve Months Ended | |||||||||||||||||||||||
December 31, 2014 | December 31, 2014 | |||||||||||||||||||||||
Consolidated | Core | FNFV | Consolidated | Core | FNFV | |||||||||||||||||||
Direct title premiums | $ | 478 | $ | 478 | $ | — | $ | 1,727 | $ | 1,727 | $ | — | ||||||||||||
Agency title premiums | 494 | 494 | — | 1,944 | 1,944 | — | ||||||||||||||||||
Total title premiums | 972 | 972 | — | 3,671 | 3,671 | — | ||||||||||||||||||
Escrow, title-related and other fees | 707 | 679 | 28 | 2,804 | 2,694 | 110 | ||||||||||||||||||
Total title and escrow and other | 1,679 | 1,651 | 28 | 6,475 | 6,365 | 110 | ||||||||||||||||||
Restaurant revenue | 381 | — | 381 | 1,436 | — | 1,436 | ||||||||||||||||||
Interest and investment income | 33 | 33 | — | 126 | 121 | 5 | ||||||||||||||||||
Realized gains and losses | (7 | ) | 4 | (11 | ) | (13 | ) | 4 | (17 | ) | ||||||||||||||
Total revenue | 2,086 | 1,688 | 398 | 8,024 | 6,490 | 1,534 | ||||||||||||||||||
Personnel costs | 644 | 588 | 56 | 2,540 | 2,370 | 170 | ||||||||||||||||||
Other operating expenses | 404 | 379 | 25 | 1,643 | 1,557 | 86 | ||||||||||||||||||
Cost of restaurant revenue | 321 | — | 321 | 1,220 | — | 1,220 | ||||||||||||||||||
Agent commissions | 373 | 373 | — | 1,471 | 1,471 | — | ||||||||||||||||||
Depreciation and amortization | 101 | 83 | 18 | 403 | 336 | 67 | ||||||||||||||||||
Title claim loss expense | 59 | 59 | — | 228 | 228 | — | ||||||||||||||||||
Interest expense | 31 | 29 | 2 | 127 | 122 | 5 | ||||||||||||||||||
Total expenses | 1,933 | 1,511 | 422 | 7,632 | 6,084 | 1,548 | ||||||||||||||||||
Earnings from continuing operations before taxes | 153 | 177 | (24 | ) | 392 | 406 | (14 | ) | ||||||||||||||||
Income tax expense | 233 | 70 | 163 | 312 | 162 | 150 | ||||||||||||||||||
Earnings from continuing operations before equity investments | (80 | ) | 107 | (187 | ) | 80 | 244 | (164 | ) | |||||||||||||||
Loss from equity investments | 475 | 1 | 474 | 432 | 4 | 428 | ||||||||||||||||||
Net earnings from continuing operations | 395 | 108 | 287 | 512 | 248 | 264 | ||||||||||||||||||
Loss from discontinued operations, net of tax | 8 | — | 8 | 7 | (1 | ) | 8 | |||||||||||||||||
Net earnings | 403 | 108 | 295 | 519 | 247 | 272 | ||||||||||||||||||
Non-controlling interests | 11 | 8 | 3 | (64 | ) | (68 | ) | 4 | ||||||||||||||||
Net earnings attributable to common shareholders | $ | 392 | $ | 100 | $ | 292 | $ | 583 | $ | 315 | $ | 268 | ||||||||||||
Cash flows provided by operations | 275 | 158 | 117 | 559 | 453 | 106 | ||||||||||||||||||
16
FIDELITY NATIONAL FINANCIAL, INC.
CONSOLIDATED SUMMARY OF EARNINGS
(In millions)
(Unaudited)
Three Months Ended | Twelve Months Ended | |||||||||||||||||||||||
December 31, 2013 | December 31, 2013 | |||||||||||||||||||||||
Consolidated | Core | FNFV | Consolidated | Core | FNFV | |||||||||||||||||||
Direct title premiums | $ | 423 | $ | 423 | $ | — | $ | 1,800 | $ | 1,800 | $ | — | ||||||||||||
Agency title premiums | 573 | 573 | — | 2,352 | 2,352 | — | ||||||||||||||||||
Total title premiums | 996 | 996 | — | 4,152 | 4,152 | — | ||||||||||||||||||
Escrow, title-related and other fees | 376 | 351 | 25 | 1,737 | 1,650 | 87 | ||||||||||||||||||
Total title and escrow and other | 1,372 | 1,347 | 25 | 5,889 | 5,802 | 87 | ||||||||||||||||||
Restaurant revenue | 371 | — | 371 | 1,408 | — | 1,408 | ||||||||||||||||||
Interest and investment income | 29 | 28 | 1 | 127 | 123 | 4 | ||||||||||||||||||
Realized gains and losses | 5 | 7 | (2 | ) | 16 | 18 | (2 | ) | ||||||||||||||||
Total revenue | 1,777 | 1,382 | 395 | 7,440 | 5,943 | 1,497 | ||||||||||||||||||
Personnel costs | 515 | 460 | 55 | 2,061 | 1,882 | 179 | ||||||||||||||||||
Other operating expenses | 289 | 267 | 22 | 1,273 | 1,189 | 84 | ||||||||||||||||||
Cost of restaurant revenue | 315 | — | 315 | 1,204 | — | 1,204 | ||||||||||||||||||
Agent commissions | 437 | 437 | — | 1,789 | 1,789 | — | ||||||||||||||||||
Depreciation and amortization | 32 | 18 | 14 | 133 | 68 | 65 | ||||||||||||||||||
Title claim loss expense | 70 | 70 | — | 291 | 291 | — | ||||||||||||||||||
Interest expense | 18 | 16 | 2 | 73 | 68 | 5 | ||||||||||||||||||
Total expenses | 1,676 | 1,268 | 408 | 6,824 | 5,287 | 1,537 | ||||||||||||||||||
Earnings from continuing operations before taxes | 101 | 114 | (13 | ) | 616 | 656 | (40 | ) | ||||||||||||||||
Income tax expense | 27 | 40 | (13 | ) | 195 | 237 | (42 | ) | ||||||||||||||||
Earnings from continuing operations before equity investments | 74 | 74 | — | 421 | 419 | 2 | ||||||||||||||||||
(Loss) earnings from equity investments | (6 | ) | — | (6 | ) | (26 | ) | 4 | (30 | ) | ||||||||||||||
Net earnings from continuing operations | 68 | 74 | (6 | ) | 395 | 423 | (28 | ) | ||||||||||||||||
Earnings from discontinued operations, net of tax | 9 | 1 | 8 | 6 | 2 | 4 | ||||||||||||||||||
Net earnings | 77 | 75 | 2 | 401 | 425 | (24 | ) | |||||||||||||||||
Non-controlling interests | 3 | — | 3 | 7 | 4 | 3 | ||||||||||||||||||
Net earnings attributable to common shareholders | $ | 74 | $ | 75 | $ | (1 | ) | $ | 394 | $ | 421 | $ | (27 | ) | ||||||||||
Cash flows provided by operations | 140 | 46 | 94 | 484 | 354 | 130 | ||||||||||||||||||
###
17
FNFV Reports Fourth Quarter 2014 Results With Completion of Several Monetization Efforts and $1.4 Billion Book Value of Portfolio Company Investments, or $14.84 Per Share Jacksonville, Fla. -- (February 18, 2015) -- FNFV (NYSE:FNFV), a tracking stock established to highlight the inherent value of the portfolio companies of Fidelity National Financial, Inc. (NYSE:FNF), today reported operating results for the three-month and twelve-month periods ended December 31, 2014.
• | Total revenue of approximately $398 million in the fourth quarter versus $395 million in the fourth quarter of 2013 |
• | Fourth quarter adjusted diluted EPS of $0.12 versus adjusted diluted EPS of $0.07 in the fourth quarter of 2013 |
• | Adjusted EBITDA of $26 million for the fourth quarter versus adjusted EBITDA of $23 million for the fourth quarter of 2013 |
• | Fourth quarter FNFV free cash flow provided of $89 million versus $78 million provided in the fourth quarter of 2013 |
Restaurant Group
• | Approximately $369 million in total revenue, adjusted EBITDA of $28 million and adjusted EBITDA margin of 7.3% for the fourth quarter versus approximately $370 million in total revenue, adjusted EBITDA of $23 million and an adjusted EBITDA margin of 6.2% in the fourth quarter of 2013 |
• | American Blue Ribbon Holdings generated $316 million in total revenue and adjusted EBITDA of more than $22 million; same store sales increased approximately 2% in the fourth quarter, with O'Charley's and Ninety Nine leading the way at 2% and 6%, respectively, both exceeding the Knapp-Track U. S. Casual Dining Index of 1.5% same store sales growth |
• | J. Alexander's produced $53 million in total revenue and adjusted EBITDA of nearly $6 million; same store sales growth was approximately 5% at both the J. Alexander's and Stoney River concepts in the fourth quarter |
Ceridian HCM
• | Fourth quarter total revenue of approximately $227 million, a 5% decline from the fourth quarter of 2013, a pre-tax loss of $5 million, EBITDA of more than $34 million and an EBITDA margin of 15% |
Digital Insurance
• | Fourth quarter total revenue of $25 million, a 28% increase over the fourth quarter of 2013; pre-tax loss of $1 million, EBITDA of more than $4 million, a 29% increase over the fourth quarter of 2013 and a fourth quarter EBITDA margin of nearly 18% |
Monetization Initiatives
• | Closed the sale of Comdata to Fleetcor in November 2014; FNFV now indirectly owns approximately 2.4 million shares of Fleetcor common stock, 75% of which is subject to a six-month lockup period and 25% of which has been placed in an escrow account and is scheduled to be released ratably over a three-year period; current value of the Fleetcor investment is approximately $360 million |
• | Completed the tax-free distribution of Remy common stock to FNFV shareholders on December 31, 2014; distributed approximately 16.6 million shares of Remy valued at approximately $350 million |
• | J. Alexander's announced filing an initial registration statement with the SEC related to the proposed initial offering of its common stock in October 2014; FNFV now intends to pursue a tax-free spin-off of J. Alexander's to FNFV shareholders |
• | J. Alexander's paid FNFV $14.6 million, of which $10 million was principal, reducing the loan balance from FNFV to J. Alexander's to $10 million |
“We completed several monetization events at FNFV this quarter,” said Chairman William P. Foley, II. “The sale of Comdata for Fleetcor common shares has brought FNFV an attractive, liquid investment in an innovative, industry-leading company. The tax-free distribution of Remy common shares provided a tax efficient monetization event for our shareholders. The J. Alexander's spin-off will make it a publicly traded common stock that will provide liquidity and a market valuation for that business. We also announced a 10 million share stock repurchase authorization during the fourth quarter and have repurchased approximately 539,000 shares to date. We also intend to use FNFV holding company liquidity to pursue a Dutch tender auction offer to repurchase up to 12 million shares of FNFV common stock. More details will be forthcoming at the launch of the tender offer."
1
Conference Call
We will host a call with investors and analysts to discuss fourth quarter 2014 results of FNFV on Thursday, February 19, 2015, beginning at 12:00 p.m. Eastern Time. A live webcast of the conference call will be available on the Events and Multimedia page of the FNF Investor Relations website at www.fnf.com. The conference call replay will be available via webcast through the FNF Investor Relations website at www.fnf.com. The telephone replay will be available from 2:00 p.m. Eastern time on February 19, 2015, through February 26, 2015, by dialing 800-475-6701 (USA) or 320-365-3844 (International). The access code will be 351179.
About FNF
Fidelity National Financial, Inc. (FNF) is organized into two groups, FNF Core (NYSE: FNF) and FNF Ventures (NYSE: FNFV). Through our Core operations, FNF is a leading provider of title insurance, technology and transaction services to the real estate and mortgage industries. FNF is the nation’s largest title insurance company through its title insurance underwriters - Fidelity National Title, Chicago Title, Commonwealth Land Title, Alamo Title and National Title of New York - that collectively issue more title insurance policies than any other title company in the United States. FNF also provides industry-leading mortgage technology solutions and transaction services, including MSP®, the leading residential mortgage servicing technology platform in the U.S., through its majority-owned subsidiaries, Black Knight Financial Services, LLC and ServiceLink Holdings, LLC. In addition, in our FNFV group, we own majority and minority equity investment stakes in a number of entities, including American Blue Ribbon Holdings, LLC, J. Alexander’s, LLC, Ceridian HCM, Inc., Fleetcor Technologies, Inc. and Digital Insurance, Inc. More information about FNF can be found at www.fnf.com.
Use of Non-GAAP Financial Information
Generally Accepted Accounting Principles (GAAP) is the term used to refer to the standard framework of guidelines for financial accounting. GAAP includes the standards, conventions, and rules accountants follow in recording and summarizing transactions and in the preparation of financial statements. In addition to reporting financial results in accordance with GAAP, the Company has provided non-GAAP financial measures, which it believes are useful to help investors better understand its financial performance, competitive position and prospects for the future. These non-GAAP measures include earnings before interest, taxes and depreciation and amortization (EBITDA), adjusted earnings before interest, taxes and depreciation and amortization (Adjusted EBITDA), adjusted earnings before interest, taxes and depreciation as a percent of adjusted revenue (Adjusted EBITDA margin), adjusted net earnings, adjusted EPS and free cash flow.
Any non-GAAP measures should be considered in context with the GAAP financial presentation and should not be considered in isolation or as a substitute for GAAP net earnings. Further, FNF's non-GAAP measures may be calculated differently from similarly titled measures of other companies. Reconciliations of these non-GAAP measures to related GAAP measures are provided below.
Tender Offer Statement
This press release is for informational purposes only and is not an offer to buy or the solicitation of an offer to sell any shares of FNFV Group common stock. The solicitation and offer to buy shares of FNFV Group common stock will only be made pursuant to the offer to purchase and related materials that FNF will send to its FNFV stockholders. FNFV stockholders should read those materials carefully because they will contain important information, including the various terms and conditions of the tender offer. FNFV stockholders will be able to obtain free copies of these materials and other documents filed by FNF with the Securities and Exchange Commission when available at www.sec.gov or at the FNF Investor Relations website at www.fnf.com.
Forward-Looking Statements
This press release contains forward-looking statements that involve a number of risks and uncertainties. Statements that are not historical facts, including statements regarding our expectations, hopes, intentions or strategies regarding the future are forward-looking statements. Forward-looking statements are based on management's beliefs, as well as assumptions made by, and information currently available to, management. Because such statements are based on expectations as to future financial and operating results and are not statements of fact, actual results may differ materially from those projected. We undertake no obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise. The risks and uncertainties which forward-looking statements are subject to include, but are not limited to: changes in general economic, business and political conditions, including changes in the financial markets; weakness or adverse changes in the level of real estate activity, which may be caused by, among other things, high or increasing interest rates, a limited supply of mortgage funding or a weak U. S. economy; our potential inability to find suitable acquisition candidates, acquisitions in lines of business that will not necessarily be limited to our traditional areas of focus, or difficulties in integrating acquisitions; our dependence on distributions from our title insurance underwriters as a main source of cash flow; significant competition that our operating subsidiaries face; compliance with extensive government regulation of our operating subsidiaries.
2
This press release should be read in conjunction with the press release filed for the results of FNF on this same date as well as the risks detailed in the “Statement Regarding Forward-Looking Information,” “Risk Factors” and other sections of the Company’s Form 10-Q,10-K and other filings with the Securities and Exchange Commission.
SOURCE: Fidelity National Financial, Inc.
CONTACT: Daniel Kennedy Murphy, Senior Vice President and Treasurer, 904-854-8120, dkmurphy@fnf.com
3
FIDELITY NATIONAL FINANCIAL VENTURES
FOURTH QUARTER SEGMENT INFORMATION
(In millions)
(Unaudited)
Total FNFV | Restaurant Group | FNFV Corporate and Other | ||||||||||
Three Months Ended | ||||||||||||
December 31, 2014 | ||||||||||||
Operating revenue | $ | 409 | $ | 381 | $ | 28 | ||||||
Realized gains and losses | (11 | ) | (12 | ) | 1 | |||||||
Total revenue | 398 | 369 | 29 | |||||||||
Personnel costs | 56 | 17 | 39 | |||||||||
Other operating expenses | 25 | 15 | 10 | |||||||||
Cost of restaurant revenue | 321 | 321 | — | |||||||||
Depreciation and amortization | 18 | 13 | 5 | |||||||||
Interest expense | 2 | 3 | (1 | ) | ||||||||
Total expenses | 422 | 369 | 53 | |||||||||
Pre-tax loss from continuing operations | $ | (24 | ) | $ | — | $ | (24 | ) | ||||
Non-GAAP adjustments before taxes | ||||||||||||
Realized loss (gain), net adjustment | $ | 11 | $ | 12 | $ | (1 | ) | |||||
FNFV incentive plan accrual | 19 | — | 19 | |||||||||
Purchase price amortization | 8 | 4 | 4 | |||||||||
Total non-GAAP adjustments before taxes | $ | 38 | $ | 16 | $ | 22 | ||||||
Adjusted pre-tax earnings from continuing operations | $ | 14 | $ | 16 | $ | (2 | ) | |||||
Adjusted pre-tax margin from continuing operations | 3.4 | % | 4.2 | % | — | |||||||
Purchase price amortization | (8 | ) | (4 | ) | (4 | ) | ||||||
Interest expense | 2 | 3 | (1 | ) | ||||||||
Depreciation and amortization | 18 | 13 | 5 | |||||||||
Adjusted EBITDA | $ | 26 | $ | 28 | $ | (2 | ) | |||||
Adjusted EBITDA margin | 6.4 | % | 7.3 | % | — | |||||||
4
FIDELITY NATIONAL FINANCIAL VENTURES
FOURTH QUARTER SEGMENT INFORMATION
(In millions)
(Unaudited)
Total FNFV | Restaurant Group | FNFV Corporate and Other | ||||||||||
Three Months Ended | ||||||||||||
December 31, 2014 | ||||||||||||
Pre-tax loss from continuing operations | $ | (24 | ) | $ | — | $ | (24 | ) | ||||
Income tax expense | 163 | 1 | 162 | |||||||||
Earnings from equity investments | 474 | — | 474 | |||||||||
Earnings from discontinued operations, net of tax | 8 | — | 8 | |||||||||
Non-controlling interests | 3 | (2 | ) | 5 | ||||||||
Net earnings attributable to FNFV common shareholders | $ | 292 | $ | 1 | $ | 291 | ||||||
EPS attributable to FNFV common shareholders - basic | $ | 3.17 | $ | 0.01 | $ | 3.16 | ||||||
EPS attributable to FNFV common shareholders - diluted | $ | 3.14 | $ | 0.01 | $ | 3.13 | ||||||
FNFV weighted average shares - basic | 92 | |||||||||||
FNFV weighted average shares - diluted | 93 | |||||||||||
Total non-GAAP, pre-tax adjustments | $ | 38 | $ | 16 | $ | 22 | ||||||
FNFV portion of gain on sale of Comdata | (490 | ) | — | (490 | ) | |||||||
Impairment of Fidelity National Environmental Solutions investment | 15 | — | 15 | |||||||||
Income taxes on non-GAAP adjustments | 169 | (3 | ) | 172 | ||||||||
Noncontrolling interest on non-GAAP adjustments | (8 | ) | (8 | ) | — | |||||||
Total non-GAAP adjustments | (276 | ) | 5 | (281 | ) | |||||||
Adjusted net earnings attributable to FNFV common shareholders | $ | 16 | $ | 6 | $ | 10 | ||||||
Adjusted EPS attributable to FNFV common shareholders - diluted | $ | 0.17 | $ | 0.06 | $ | 0.11 | ||||||
Adjusted net earnings attributable to FNFV common shareholders | $ | 16 | $ | 6 | $ | 10 | ||||||
Earnings from discontinued operations, net of tax | (8 | ) | — | (8 | ) | |||||||
Non-controlling interests on discontinued operations | 4 | — | 4 | |||||||||
Net earnings from continuing operations attributable to FNFV common shareholders | $ | 12 | $ | 6 | $ | 6 | ||||||
Adjusted EPS from continuing operations attributable to FNFV common shareholders - diluted | $ | 0.12 | $ | 0.06 | $ | 0.06 | ||||||
Cash flows provided by operations: | $ | 117 | ||||||||||
Capital expenditures | 28 | |||||||||||
Free cash flow | $ | 89 | ||||||||||
5
FIDELITY NATIONAL FINANCIAL VENTURES
FOURTH QUARTER SEGMENT INFORMATION
(In millions)
(Unaudited)
Total FNFV | Restaurant Group | FNFV Corporate and Other | ||||||||||
Three Months Ended | ||||||||||||
December 31, 2013 | ||||||||||||
Operating revenue | $ | 396 | $ | 371 | $ | 25 | ||||||
Interest and investment income | 1 | — | 1 | |||||||||
Realized gains and losses | (2 | ) | (1 | ) | (1 | ) | ||||||
Total revenue | 395 | 370 | 25 | |||||||||
Personnel costs | 55 | 18 | 37 | |||||||||
Other operating expenses | 22 | 15 | 7 | |||||||||
Cost of restaurant revenue | 315 | 315 | — | |||||||||
Depreciation and amortization | 14 | 13 | 1 | |||||||||
Interest expense | 2 | 2 | — | |||||||||
Total expenses | 408 | 363 | 45 | |||||||||
Pre-tax (loss) earnings from continuing operations | $ | (13 | ) | $ | 7 | $ | (20 | ) | ||||
Non-GAAP adjustments before taxes | ||||||||||||
Realized loss, net adjustment | $ | 2 | $ | 1 | $ | 1 | ||||||
FNFV incentive plan accrual | 18 | — | 18 | |||||||||
Purchase price amortization | 6 | 4 | 2 | |||||||||
Total non-GAAP adjustments before taxes | $ | 26 | $ | 5 | $ | 21 | ||||||
Adjusted pre-tax earnings from continuing operations | $ | 13 | $ | 12 | $ | 1 | ||||||
Adjusted pre-tax margin from continuing operations | 3.3 | % | 3.2 | % | 3.8 | % | ||||||
Purchase price amortization | (6 | ) | (4 | ) | (2 | ) | ||||||
Interest expense | 2 | 2 | — | |||||||||
Depreciation and amortization | 14 | 13 | 1 | |||||||||
Adjusted EBITDA | $ | 23 | $ | 23 | $ | — | ||||||
Adjusted EBITDA margin | 5.8 | % | 6.2 | % | — | |||||||
6
FIDELITY NATIONAL FINANCIAL VENTURES
FOURTH QUARTER SEGMENT INFORMATION
(In millions)
(Unaudited)
Total FNFV | Restaurant Group | FNFV Corporate and Other | ||||||||||
Three Months Ended | ||||||||||||
December 31, 2013 | ||||||||||||
Pre-tax earnings from continuing operations | $ | (13 | ) | $ | 7 | $ | (20 | ) | ||||
Income tax expense | (13 | ) | (3 | ) | (10 | ) | ||||||
Loss from equity investments | (6 | ) | — | (6 | ) | |||||||
Earnings from discontinued operations, net of tax | 8 | — | 8 | |||||||||
Non-controlling interests | 3 | 3 | — | |||||||||
Net earnings attributable to Old FNF common shareholders | $ | (1 | ) | $ | 7 | $ | (8 | ) | ||||
EPS attributable to Old FNF common shareholders - basic | $ | — | $ | 0.03 | $ | (0.03 | ) | |||||
EPS attributable to Old FNF common shareholders - diluted | $ | — | $ | 0.03 | $ | (0.03 | ) | |||||
Old FNF weighted average shares - basic | 230 | |||||||||||
Old FNF weighted average shares - diluted | 235 | |||||||||||
Total non-GAAP, pre-tax adjustments | $ | 26 | $ | 5 | $ | 21 | ||||||
Ceridian adjustments | 10 | — | 10 | |||||||||
Income taxes on non-GAAP adjustments | (12 | ) | (2 | ) | (10 | ) | ||||||
Noncontrolling interest on non-GAAP adjustments | (1 | ) | (1 | ) | — | |||||||
Total non-GAAP adjustments | 23 | 2 | 21 | |||||||||
Adjusted net earnings attributable to Old FNF common shareholders | $ | 22 | $ | 9 | $ | 13 | ||||||
Adjusted EPS attributable to Old FNF common shareholders - diluted | $ | 0.09 | $ | 0.04 | $ | 0.06 | ||||||
Adjusted net earnings attributable to Old FNF common shareholders | $ | 22 | $ | 9 | $ | 13 | ||||||
Earnings from discontinued operations, net of tax | (8 | ) | — | (8 | ) | |||||||
Non-controlling interests on discontinued operations | 4 | — | 4 | |||||||||
Net earnings from continuing operations attributable to Old FNF common shareholders | $ | 18 | $ | 9 | $ | 9 | ||||||
Adjusted EPS from continuing operations attributable to Old FNF common shareholders - diluted | $ | 0.07 | $ | 0.04 | $ | 0.04 | ||||||
Cash flows provided by operations: | $ | 94 | ||||||||||
Capital expenditures | 16 | |||||||||||
Free cash flow | $ | 78 | ||||||||||
7
FIDELITY NATIONAL FINANCIAL VENTURES
YTD SEGMENT INFORMATION
(In millions)
(Unaudited)
Total FNFV | Restaurant Group | FNFV Corporate and Other | ||||||||||
Twelve Months Ended | ||||||||||||
December 31, 2014 | ||||||||||||
Operating revenue | $ | 1,546 | $ | 1,436 | $ | 110 | ||||||
Interest and investment income | 5 | — | 5 | |||||||||
Realized gains and losses | (17 | ) | (13 | ) | (4 | ) | ||||||
Total revenue | 1,534 | 1,423 | 111 | |||||||||
Personnel costs | 170 | 69 | 101 | |||||||||
Other operating expenses | 86 | 61 | 25 | |||||||||
Cost of restaurant revenue | 1,220 | 1,220 | — | |||||||||
Depreciation and amortization | 67 | 52 | 15 | |||||||||
Interest expense | 5 | 8 | (3 | ) | ||||||||
Total expenses | 1,548 | 1,410 | 138 | |||||||||
Pre-tax earnings from continuing operations | $ | (14 | ) | $ | 13 | $ | (27 | ) | ||||
Non-GAAP adjustments before taxes | ||||||||||||
Realized loss, net adjustment | $ | 17 | $ | 13 | $ | 4 | ||||||
FNFV incentive plan accrual | 19 | — | 19 | |||||||||
Purchase price amortization | 27 | 15 | 12 | |||||||||
Total non-GAAP adjustments before taxes | $ | 63 | $ | 28 | $ | 35 | ||||||
Adjusted pre-tax earnings from continuing operations | $ | 49 | $ | 41 | $ | 8 | ||||||
Adjusted pre-tax margin from continuing operations | 3.2 | % | 2.9 | % | 7.0 | % | ||||||
Purchase price amortization | (27 | ) | (15 | ) | (12 | ) | ||||||
Interest expense | 5 | 8 | (3 | ) | ||||||||
Depreciation and amortization | 67 | 52 | 15 | |||||||||
Adjusted EBITDA | $ | 94 | $ | 86 | $ | 8 | ||||||
Adjusted EBITDA margin | 6.1 | % | 6.0 | % | 7.0 | % | ||||||
Pre-tax earnings from continuing operations | $ | (14 | ) | $ | 13 | $ | (27 | ) | ||||
Income tax expense | 150 | 1 | 149 | |||||||||
Earnings from equity investments | 428 | — | 428 | |||||||||
Earnings from discontinued operations, net of tax | 8 | — | 8 | |||||||||
Non-controlling interests | 4 | 2 | 2 | |||||||||
Net earnings attributable to FNF common shareholders | $ | 268 | $ | 10 | $ | 258 | ||||||
EPS attributable to Old FNF common shareholders - basic | $ | (0.04 | ) | $ | 0.04 | $ | (0.08 | ) | ||||
EPS attributable to Old FNF common shareholders - diluted | $ | (0.04 | ) | $ | 0.04 | $ | (0.08 | ) | ||||
Old FNF weighted average shares - basic | 138 | |||||||||||
Old FNF weighted average shares - diluted | 142 | |||||||||||
EPS attributable to FNFV group common shareholders - basic | $ | 3.04 | $ | — | $ | 3.04 | ||||||
EPS attributable to FNFV group common shareholders - diluted | $ | 3.01 | $ | — | $ | 3.01 | ||||||
8
FIDELITY NATIONAL FINANCIAL VENTURES
YTD SEGMENT INFORMATION
(In millions)
(Unaudited)
Total FNFV | Restaurant Group | FNFV Corporate and Other | ||||||||||
Twelve Months Ended | ||||||||||||
December 31, 2014 | ||||||||||||
FNFV weighted average shares - basic | 46 | |||||||||||
FNFV weighted average shares - diluted | 47 | |||||||||||
FNFV actual shares outstanding as of December 31, 2014 | 93 | |||||||||||
Total Non-GAAP, pre-tax adjustments | $ | 63 | $ | 28 | $ | 35 | ||||||
Ceridian Comdata gain and other Ceridian legal adjustments | (456 | ) | — | (456 | ) | |||||||
Impairment of Fidelity National Environmental Solutions investment | 15 | — | 15 | |||||||||
Income taxes on non-GAAP adjustments | 148 | (6 | ) | 154 | ||||||||
Noncontrolling interest on non-GAAP adjustments | (13 | ) | (13 | ) | — | |||||||
Total non-GAAP adjustments | (243 | ) | 9 | (252 | ) | |||||||
Total adjusted net earnings attributable to FNFV | $ | 25 | $ | 19 | $ | 6 | ||||||
Total adjusted EPS attributable to FNFV shareholders - diluted* | $ | 0.27 | $ | 0.20 | $ | 0.06 | ||||||
Adjusted net earnings attributable to FNFV common shareholders | $ | 25 | $ | 19 | $ | 6 | ||||||
Earnings from discontinued operations, net of tax | (8 | ) | — | (8 | ) | |||||||
Non-controlling interests on discontinued operations | 4 | — | 4 | |||||||||
Net earnings from continuing operations attributable to FNFV common shareholders | $ | 21 | $ | 19 | $ | 2 | ||||||
Adjusted EPS from continuing operations attributable to FNFV common shareholders* | $ | 0.22 | $ | 0.20 | $ | 0.02 | ||||||
* Adjusted EPS is presented as if 93M shares of FNFV group common stock were outstanding for the entire twelve months | ||||||||||||
Cash flows provided by operations: | $ | 106 | ||||||||||
Non-GAAP adjustments: | ||||||||||||
FNFV incentive program payments | 57 | |||||||||||
Other legal matters | 16 | |||||||||||
Total non-GAAP adjustments | 73 | |||||||||||
Adjusted cash flows from operations | 179 | |||||||||||
Capital expenditures | 90 | |||||||||||
Free cash flow | $ | 89 | ||||||||||
9
FIDELITY NATIONAL FINANCIAL VENTURES
YTD SEGMENT INFORMATION
(In millions)
(Unaudited)
Total FNFV | Restaurant Group | FNFV Corporate and Other | ||||||||||
Twelve Months Ended | ||||||||||||
December 31, 2013 | ||||||||||||
Operating revenue | $ | 1,495 | $ | 1,408 | $ | 87 | ||||||
Interest and investment income | 4 | — | 4 | |||||||||
Realized gains and losses | (2 | ) | (1 | ) | (1 | ) | ||||||
Total revenue | 1,497 | 1,407 | 90 | |||||||||
Personnel costs | 179 | 65 | 114 | |||||||||
Other operating expenses | 84 | 65 | 19 | |||||||||
Cost of restaurant revenue | 1,204 | 1,204 | — | |||||||||
Depreciation and amortization | 65 | 53 | 12 | |||||||||
Interest expense | 5 | 8 | (3 | ) | ||||||||
Total expenses | 1,537 | 1,395 | 142 | |||||||||
Pre-tax (loss) earnings from continuing operations | $ | (40 | ) | $ | 12 | $ | (52 | ) | ||||
Non-GAAP adjustments before taxes | ||||||||||||
Realized loss, net adjustment | $ | 2 | $ | 1 | $ | 1 | ||||||
FNFV incentive plan accrual | 54 | — | 54 | |||||||||
Purchase price amortization | 21 | 11 | 10 | |||||||||
Total non-GAAP adjustments before taxes | $ | 77 | $ | 12 | $ | 65 | ||||||
Adjusted pre-tax earnings from continuing operations | $ | 37 | $ | 24 | $ | 13 | ||||||
Adjusted pre-tax margin from continuing operations | 2.5 | % | 1.7 | % | 14.3 | % | ||||||
Purchase price amortization | (21 | ) | (11 | ) | (10 | ) | ||||||
Interest expense | 5 | 8 | (3 | ) | ||||||||
Depreciation and amortization | 65 | 53 | 12 | |||||||||
Adjusted EBITDA | $ | 86 | $ | 74 | $ | 12 | ||||||
Adjusted EBITDA margin | 5.7 | % | 5.3 | % | 13.2 | % | ||||||
10
FIDELITY NATIONAL FINANCIAL VENTURES
YTD SEGMENT INFORMATION
(In millions)
(Unaudited)
Total FNFV | Restaurant Group | FNFV Corporate and Other | ||||||||||
Twelve Months Ended | ||||||||||||
December 31, 2013 | ||||||||||||
Pre-tax earnings from continuing operations | $ | (40 | ) | $ | 12 | $ | (52 | ) | ||||
Income tax (benefit) expense | (42 | ) | (4 | ) | (38 | ) | ||||||
Loss from equity investments | (30 | ) | — | (30 | ) | |||||||
Earnings (loss) from discontinued operations, net of tax | 4 | (3 | ) | 7 | ||||||||
Non-controlling interests | 3 | 4 | (1 | ) | ||||||||
Net (loss) earnings attributable to Old FNF common shareholders | $ | (27 | ) | $ | 9 | $ | (36 | ) | ||||
EPS attributable to Old FNF common shareholders - basic | $ | (0.12 | ) | $ | 0.04 | $ | (0.16 | ) | ||||
EPS attributable to Old FNF common shareholders - diluted | $ | (0.12 | ) | $ | 0.04 | $ | (0.16 | ) | ||||
Weighted average shares - basic | 230 | |||||||||||
Weighted average shares - diluted | 235 | |||||||||||
Total non-GAAP, pre-tax adjustments | $ | 77 | $ | 12 | $ | 65 | ||||||
Income taxes on non-GAAP adjustments | (24 | ) | (4 | ) | (20 | ) | ||||||
Noncontrolling interest on non-GAAP adjustments | (3 | ) | (3 | ) | — | |||||||
Total non-GAAP adjustments | 50 | 5 | 45 | |||||||||
Adjusted net earnings attributable to Old FNF common shareholders | $ | 23 | $ | 14 | $ | 9 | ||||||
Adjusted EPS attributable to Old FNF common shareholders - diluted | $ | 0.10 | $ | 0.06 | $ | 0.04 | ||||||
Adjusted net earnings attributable to FNFV | $ | 23 | $ | 14 | $ | 9 | ||||||
Earnings from discontinued operations, net of tax | (4 | ) | 3 | (7 | ) | |||||||
Non-controlling interests on discontinued operations | 2 | (1 | ) | 3 | ||||||||
Net earnings from continuing operations attributable to FNFV | $ | 21 | $ | 16 | $ | 5 | ||||||
Adjusted EPS from continuing operations attributable to FNFV common shareholders* | $ | 0.09 | $ | 0.07 | $ | 0.02 | ||||||
Cash flows provided by operations: | $ | 130 | ||||||||||
Non-GAAP adjustments: | ||||||||||||
Other legal matters | 7 | |||||||||||
Total non-GAAP adjustments | 7 | |||||||||||
Adjusted cash flows from operations | 137 | |||||||||||
Capital expenditures | 78 | |||||||||||
Free cash flow | $ | 59 | ||||||||||
11
FIDELITY NATIONAL FINANCIAL VENTURES
SUMMARY BALANCE SHEET INFORMATION
(In millions)
FNFV December 31, 2014 | FNFV December 31, 2013 | |||||||||
(Unaudited) | (Unaudited) | |||||||||
Cash and investment portfolio | $ | 1,009 | $ | 559 | ||||||
Goodwill | 206 | 462 | ||||||||
Total assets | 1,923 | 2,616 | ||||||||
Notes payable | 124 | 452 | ||||||||
Non-controlling interest | 137 | 465 | ||||||||
Total equity and redeemable non-controlling interests | 1,515 | 1,639 | ||||||||
Total equity attributable to common shareholders | 1,378 | 1,174 | ||||||||
FNF Core | FNFV | Consolidated December 31, 2014 | Consolidated December 31, 2013 | ||||||||||||||||||
(Unaudited) | (Unaudited) | (Unaudited) | |||||||||||||||||||
Cash and investment portfolio | $ | 4,360 | $ | 1,009 | $ | 5,369 | $ | 5,761 | |||||||||||||
Goodwill | 4,514 | 206 | 4,720 | 1,901 | |||||||||||||||||
Title plant | 393 | — | 393 | 370 | |||||||||||||||||
Total assets | 11,944 | 1,923 | 13,867 | 10,529 | |||||||||||||||||
Notes payable | 2,702 | 124 | 2,826 | 1,323 | |||||||||||||||||
Reserve for title claim losses | 1,621 | — | 1,621 | 1,636 | |||||||||||||||||
Secured trust deposits | 622 | — | 622 | 588 | |||||||||||||||||
Redeemable non-controlling interests | 717 | — | 717 | — | |||||||||||||||||
Non-redeemable non-controlling interests | (60 | ) | 137 | 77 | 474 | ||||||||||||||||
Total equity and redeemable non-controlling interests | 5,272 | 1,515 | 6,787 | 5,535 | |||||||||||||||||
Total equity attributable to common shareholders | 4,615 | 1,378 | 5,993 | 5,061 | |||||||||||||||||
12
FIDELITY NATIONAL FINANCIAL VENTURES
BOOK VALUE SUMMARY
(In millions)
(Unaudited)
FNFV December 31, 2014 | |||||
Book Value | |||||
Ceridian/Fleetcor | $ | 632 | |||
American Blue Ribbon Holdings | 159 | ||||
J. Alexander's | 100 | ||||
Digital Insurance | 149 | ||||
Cascade | 63 | ||||
Holding Company Cash | 164 | ||||
Other | 111 | ||||
FNFV Book Value | $ | 1,378 | |||
13
FIDELITY NATIONAL FINANCIAL, INC.
CONSOLIDATED SUMMARY OF EARNINGS
(In millions)
(Unaudited)
Three Months Ended | Twelve Months Ended | |||||||||||||||||||||||
December 31, 2014 | December 31, 2014 | |||||||||||||||||||||||
Consolidated | Core | FNFV | Consolidated | Core | FNFV | |||||||||||||||||||
Direct title premiums | $ | 478 | $ | 478 | $ | — | $ | 1,727 | $ | 1,727 | $ | — | ||||||||||||
Agency title premiums | 494 | 494 | — | 1,944 | 1,944 | — | ||||||||||||||||||
Total title premiums | 972 | 972 | — | 3,671 | 3,671 | — | ||||||||||||||||||
Escrow, title-related and other fees | 707 | 679 | 28 | 2,804 | 2,694 | 110 | ||||||||||||||||||
Total title and escrow and other | 1,679 | 1,651 | 28 | 6,475 | 6,365 | 110 | ||||||||||||||||||
Restaurant revenue | 381 | — | 381 | 1,436 | — | 1,436 | ||||||||||||||||||
Interest and investment income | 33 | 33 | — | 126 | 121 | 5 | ||||||||||||||||||
Realized gains and losses | (7 | ) | 4 | (11 | ) | (13 | ) | 4 | (17 | ) | ||||||||||||||
Total revenue | 2,086 | 1,688 | 398 | 8,024 | 6,490 | 1,534 | ||||||||||||||||||
Personnel costs | 644 | 588 | 56 | 2,540 | 2,370 | 170 | ||||||||||||||||||
Other operating expenses | 404 | 379 | 25 | 1,643 | 1,557 | 86 | ||||||||||||||||||
Cost of restaurant revenue | 321 | — | 321 | 1,220 | — | 1,220 | ||||||||||||||||||
Agent commissions | 373 | 373 | — | 1,471 | 1,471 | — | ||||||||||||||||||
Depreciation and amortization | 101 | 83 | 18 | 403 | 336 | 67 | ||||||||||||||||||
Title claim loss expense | 59 | 59 | — | 228 | 228 | — | ||||||||||||||||||
Interest expense | 31 | 29 | 2 | 127 | 122 | 5 | ||||||||||||||||||
Total expenses | 1,933 | 1,511 | 422 | 7,632 | 6,084 | 1,548 | ||||||||||||||||||
Earnings (loss) from continuing operations before taxes | 153 | 177 | (24 | ) | 392 | 406 | (14 | ) | ||||||||||||||||
Income tax expense | 233 | 70 | 163 | 312 | 162 | 150 | ||||||||||||||||||
(Loss) earnings from continuing operations before equity investments | (80 | ) | 107 | (187 | ) | 80 | 244 | (164 | ) | |||||||||||||||
Earnings from equity investments | 475 | 1 | 474 | 432 | 4 | 428 | ||||||||||||||||||
Net earnings from continuing operations | 395 | 108 | 287 | 512 | 248 | 264 | ||||||||||||||||||
Earnings (loss) from discontinued operations, net of tax | 8 | — | 8 | 7 | (1 | ) | 8 | |||||||||||||||||
Net earnings | 403 | 108 | 295 | 519 | 247 | 272 | ||||||||||||||||||
Non-controlling interests | 11 | 8 | 3 | (64 | ) | (68 | ) | 4 | ||||||||||||||||
Net earnings attributable to common shareholders | $ | 392 | $ | 100 | $ | 292 | $ | 583 | $ | 315 | $ | 268 | ||||||||||||
Cash flows provided by operations | 275 | 158 | 117 | 559 | 453 | 106 | ||||||||||||||||||
14
FIDELITY NATIONAL FINANCIAL, INC.
CONSOLIDATED SUMMARY OF EARNINGS
(In millions)
(Unaudited)
Three Months Ended | Twelve Months Ended | |||||||||||||||||||||||
December 31, 2013 | December 31, 2013 | |||||||||||||||||||||||
Consolidated | Core | FNFV | Consolidated | Core | FNFV | |||||||||||||||||||
Direct title premiums | $ | 423 | $ | 423 | $ | — | $ | 1,800 | $ | 1,800 | $ | — | ||||||||||||
Agency title premiums | 573 | 573 | — | 2,352 | 2,352 | — | ||||||||||||||||||
Total title premiums | 996 | 996 | — | 4,152 | 4,152 | — | ||||||||||||||||||
Escrow, title-related and other fees | 376 | 351 | 25 | 1,737 | 1,650 | 87 | ||||||||||||||||||
Total title and escrow and other | 1,372 | 1,347 | 25 | 5,889 | 5,802 | 87 | ||||||||||||||||||
Restaurant revenue | 371 | — | 371 | 1,408 | — | 1,408 | ||||||||||||||||||
Interest and investment income | 29 | 28 | 1 | 127 | 123 | 4 | ||||||||||||||||||
Realized gains and losses | 5 | 7 | (2 | ) | 16 | 18 | (2 | ) | ||||||||||||||||
Total revenue | 1,777 | 1,382 | 395 | 7,440 | 5,943 | 1,497 | ||||||||||||||||||
Personnel costs | 515 | 460 | 55 | 2,061 | 1,882 | 179 | ||||||||||||||||||
Other operating expenses | 289 | 267 | 22 | 1,273 | 1,189 | 84 | ||||||||||||||||||
Cost of restaurant revenue | 315 | — | 315 | 1,204 | — | 1,204 | ||||||||||||||||||
Agent commissions | 437 | 437 | — | 1,789 | 1,789 | — | ||||||||||||||||||
Depreciation and amortization | 32 | 18 | 14 | 133 | 68 | 65 | ||||||||||||||||||
Title claim loss expense | 70 | 70 | — | 291 | 291 | — | ||||||||||||||||||
Interest expense | 18 | 16 | 2 | 73 | 68 | 5 | ||||||||||||||||||
Total expenses | 1,676 | 1,268 | 408 | 6,824 | 5,287 | 1,537 | ||||||||||||||||||
Earnings (loss) from continuing operations before taxes | 101 | 114 | (13 | ) | 616 | 656 | (40 | ) | ||||||||||||||||
Income tax expense (benefit) | 27 | 40 | (13 | ) | 195 | 237 | (42 | ) | ||||||||||||||||
Earnings from continuing operations before equity investments | 74 | 74 | — | 421 | 419 | 2 | ||||||||||||||||||
(Loss) earnings from equity investments | (6 | ) | — | (6 | ) | (26 | ) | 4 | (30 | ) | ||||||||||||||
Net earnings (loss) from continuing operations | 68 | 74 | (6 | ) | 395 | 423 | (28 | ) | ||||||||||||||||
Earnings from discontinued operations, net of tax | 9 | 1 | 8 | 6 | 2 | 4 | ||||||||||||||||||
Net earnings (loss) | 77 | 75 | 2 | 401 | 425 | (24 | ) | |||||||||||||||||
Non-controlling interests | 3 | — | 3 | 7 | 4 | 3 | ||||||||||||||||||
Net earnings (loss) attributable to common shareholders | $ | 74 | $ | 75 | $ | (1 | ) | $ | 394 | $ | 421 | $ | (27 | ) | ||||||||||
Cash flows provided by operations | 140 | 46 | 94 | 484 | 354 | 130 | ||||||||||||||||||
###
15