JACKSONVILLE, Fla.,
Oct. 20 /PRNewswire-FirstCall/ --
Fidelity National Financial, Inc. (NYSE: FNF), a leading provider
of title insurance, mortgage services, specialty insurance and
information services, today reported operating results for the
three-month and nine-month periods ended September 30, 2010.
|
|
|
Three Months
Ended
September
30, 2010
|
Three Months
Ended
September
30, 2009
|
|
Total revenue
|
$1.42
billion
|
$1.47
billion
|
|
Net earnings attributable to
common shareholders
|
$83.2
million
|
$73.4
million
|
|
Net earnings per diluted share
attributable to common shareholders
|
$0.36
|
$0.32
|
|
Cash flow from
operations
|
$21.2
million
|
$84.5
million
|
|
|
|
|
|
|
|
|
|
Nine Months
Ended
September
30, 2010
|
Nine Months
Ended
September
30, 2009
|
|
Total revenue
|
$4.13
billion
|
$4.37
billion
|
|
Net earnings attributable to
common shareholders
|
$239.3
million
|
$153.0
million
|
|
Net earnings per diluted share
attributable to common shareholders
|
$1.04
|
$0.67
|
|
Cash flow from
operations
|
$69.1
million
|
$367.7
million
|
|
|
|
|
|
|
The following are summary financial and operational results for
the operating segments of FNF for the three-month and nine-month
periods ended September 30, 2010 and
2009:
Fidelity National Title Group ("FNT")
|
|
|
Three Months
Ended
September
30, 2010
|
Three Months
Ended
September
30, 2009
|
|
Total revenue
|
$1.29
billion
|
$1.35
billion
|
|
Pre-tax earnings
|
$135.5
million
|
$119.8
million
|
|
Pre-tax margin
|
10.5%
|
8.9%
|
|
|
Nine Months
Ended
September
30, 2010
|
Nine Months
Ended
September
30, 2009
|
|
Total revenue
|
$3.62
billion
|
$4.06
billion
|
|
Pre-tax earnings
|
$280.5
million
|
$260.4
million
|
|
Pre-tax margin
|
7.8%
|
6.4%
|
|
|
|
|
|
|
|
|
Month
|
Direct
Orders Opened
|
Direct
Orders Closed
|
|
July 2010
|
220,700
|
119,600
|
|
August 2010
|
251,700
|
139,600
|
|
September 2010
|
239,500
|
148,800
|
|
Third Quarter
2010
|
711,900
|
408,000
|
|
|
|
|
|
July 2009
|
191,100
|
166,000
|
|
August 2009
|
181,100
|
137,200
|
|
September 2009
|
196,400
|
135,500
|
|
Third Quarter
2009
|
568,600
|
438,700
|
|
|
|
|
|
|
|
|
|
Open
Commercial
Orders
|
Closed
Commercial
Orders
|
Commercial
Revenue
(In
millions)
|
Commercial
Fee Per
File
|
|
3rd Quarter 2010
|
18,000
|
10,300
|
$67.8
|
$6,600
|
|
3rd Quarter 2009
|
19,400
|
12,700
|
$57.6
|
$4,500
|
|
|
|
|
|
|
|
|
- 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.
Specialty Insurance
|
|
|
Three Months
Ended
September
30, 2010
|
Three Months
Ended
September
30, 2009
|
|
Total revenue
|
$113.8
million
|
$102.5
million
|
|
Pre-tax earnings
|
$10.9
million
|
$7.3
million
|
|
Pre-tax margin
|
9.6%
|
7.1%
|
|
|
|
|
|
|
Nine Months
Ended
September
30, 2010
|
Nine Months
Ended
September
30, 2009
|
|
Total revenue
|
$307.4
million
|
$287.5
million
|
|
Pre-tax earnings
|
$28.2
million
|
$35.0
million
|
|
Pre-tax margin
|
9.2%
|
12.2%
|
|
|
|
|
|
|
"This was another solid quarter for our title insurance
business," said Chairman William P. Foley,
II. "In particular, refinance order volumes showed
strength throughout the quarter, moving from 10,500 open orders per
day in July to more than 11,400 open orders per day in both August
and September. For the quarter, refinance orders comprised
approximately 67% of total open orders and 63% of closed orders,
with closed refinance orders peaking at 67% of total closed orders
during the month of September. While we started to see an
increase in closing activity later in the quarter, a large number
of the third quarter open orders will actually close during the
fourth quarter, providing further earnings momentum as we close out
2010.
"During the quarter, we sold approximately half of our
investment in FIS stock through that company's August tender offer,
selling 1.6 million shares at the tender price of $29. This resulted in total proceeds of
nearly $47 million, a pre-tax gain of
approximately $22 million. We
continue to own another 1.6 million shares of FIS with a current
value of approximately $45 million.
"There has been significant discussion and speculation
concerning our involvement with foreclosures and potential risks we
face from those transactions. Many lenders have announced
that they have halted foreclosures and the sale of REO properties
due to possible flaws in documentation used in the foreclosure
process. We do not believe that this situation will have a
material adverse impact on our title business. FNF's title
insurance underwriters issue title policies on REO properties to
new purchasers and lenders to those purchasers. FNF believes
that these policies will not result in additional claims exposure
to FNF because the new owners and their lenders would have the
rights of good faith purchasers which should not be affected by
potential defects in documentation. Even if a court sets
aside a foreclosure due to a defect in documentation, the
foreclosing lender would be required to return all funds obtained
from our insureds, resulting in no loss under the title insurance
policy.
"Additionally, we recently reached an agreement with Bank of
America under which they will provide a representation that all
documentation, procedures and/or notices related to the foreclosure
of a property comply with state law and local practice and they
will indemnify FNF against any losses incurred directly by their
failure to comply with state law or local practice on both
transactions in which foreclosure has already occurred or been
initiated and those to be initiated in the future. We believe
that this agreement reflects current law in every state and is
consistent with the rights that we have under the policies we
issue. We will also require similar representation and
indemnification on future REO banked-owned transactions from all
other lenders."
Conference Call
FNF will host a call with investors and analysts to discuss
third quarter 2010 results on Thursday,
October 21, 2010, beginning at 9:00
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 11:00 a.m. Eastern
time today through October 28,
2010, by dialing 800-475-6701 (USA) or 320-365-3844 (International).
The access code will be 173222.
About FNF
Fidelity National Financial, Inc. (NYSE: FNF), is a leading
provider of title insurance, mortgage services, specialty insurance
and information services. FNF is the nation's largest title
insurance company through its title insurance underwriters -
Fidelity National Title, Chicago Title, Commonwealth Land Title and
Alamo Title - that collectively issue more title insurance policies
than any other title company in the
United States. FNF also provides flood insurance,
personal lines insurance and home warranty insurance through its
specialty insurance business and is a leading provider of global
human resources, payroll, benefits and payment solutions through a
minority-owned subsidiary, Ceridian Corporation. More
information about FNF can be found 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 about our beliefs and
expectations, 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 economic performance 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 operating subsidiaries as a source of cash flow; significant
competition that our operating subsidiaries face; compliance with
extensive government regulation of our operating subsidiaries; and
other risks detailed in the "Statement Regarding Forward-Looking
Information," "Risk Factors" and other sections of the Company's
Form 10-K and other filings with the Securities and Exchange
Commission.
FIDELITY
NATIONAL FINANCIAL, INC.
SUMMARY OF
EARNINGS
(In
millions, except per share amounts)
|
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
|
September
30,
|
|
September
30,
|
|
|
2010
|
|
2009
|
|
2010
|
|
2009
|
|
|
(Unaudited)
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
Direct title premiums
|
$357.6
|
|
$379.4
|
|
$983.6
|
|
$1,122.1
|
|
Agency title premiums
|
545.7
|
|
603.6
|
|
1,582.3
|
|
1,814.1
|
|
Total title
premiums
|
903.3
|
|
983.0
|
|
2,565.9
|
|
2,936.2
|
|
Escrow, title-related and other
fees
|
336.3
|
|
337.6
|
|
967.3
|
|
1,029.4
|
|
Total title and
escrow
|
1,239.6
|
|
1,320.6
|
|
3,533.2
|
|
3,965.6
|
|
|
|
|
|
|
|
|
|
|
Specialty insurance
|
110.8
|
|
99.3
|
|
298.1
|
|
276.6
|
|
Interest and investment
income
|
34.0
|
|
36.7
|
|
109.2
|
|
112.9
|
|
Realized gains and
losses
|
40.1
|
|
10.6
|
|
192.9
|
|
18.1
|
|
Total revenue
|
1,424.5
|
|
1,467.2
|
|
4,133.4
|
|
4,373.2
|
|
|
|
|
|
|
|
|
|
|
Personnel costs
|
405.1
|
|
410.5
|
|
1,173.5
|
|
1,260.4
|
|
Other operating
expenses
|
328.4
|
|
343.9
|
|
944.3
|
|
1,024.0
|
|
Agent commissions
|
427.5
|
|
480.8
|
|
1,247.8
|
|
1,446.5
|
|
Depreciation and
amortization
|
22.3
|
|
23.1
|
|
67.8
|
|
84.7
|
|
Claim loss expense
|
100.8
|
|
92.5
|
|
284.0
|
|
290.2
|
|
Interest expense
|
12.9
|
|
8.0
|
|
32.5
|
|
28.4
|
|
Total expenses
|
1,297.0
|
|
1,358.8
|
|
3,749.9
|
|
4,134.2
|
|
|
|
|
|
|
|
|
|
|
Earnings from continuing
operations before taxes
|
127.5
|
|
108.4
|
|
383.5
|
|
239.0
|
|
Income tax expense
|
44.6
|
|
34.4
|
|
134.2
|
|
68.1
|
|
Earnings from continuing
operations before equity investments
|
82.9
|
|
74.0
|
|
249.3
|
|
170.9
|
|
Earnings (loss) from equity
investments
|
0.9
|
|
2.7
|
|
(6.2)
|
|
(14.0)
|
|
Net earnings from continuing
operations
|
83.8
|
|
76.7
|
|
243.1
|
|
156.9
|
|
Loss from discontinued
operations, net of tax
|
--
|
|
(1.8)
|
|
--
|
|
(1.9)
|
|
Net earnings
|
83.8
|
|
74.9
|
|
243.1
|
|
155.0
|
|
Non-controlling
interests
|
0.6
|
|
1.5
|
|
3.8
|
|
2.0
|
|
Net earnings attributable to
common shareholders
|
$83.2
|
|
$73.4
|
|
$239.3
|
|
$153.0
|
|
Earnings per share:
|
|
|
|
|
|
|
|
|
Net earnings
from continuing operations and attributable to common shareholders
- basic
|
$0.37
|
|
$0.32
|
|
$1.05
|
|
$0.68
|
|
Net earnings
from continuing operations and attributable to common shareholders
-diluted
|
$0.36
|
|
$0.32
|
|
$1.04
|
|
$0.67
|
|
Weighted average shares –
basic
|
225.9
|
|
228.7
|
|
227.0
|
|
223.4
|
|
Weighted average shares –
diluted
|
229.2
|
|
232.1
|
|
230.0
|
|
227.4
|
|
|
|
|
|
|
|
|
|
|
Direct operations orders
opened (000's)
|
711.9
|
|
568.6
|
|
1,774.1
|
|
2,060.8
|
|
Direct operations orders
closed (000's)
|
408.0
|
|
438.7
|
|
1,102.4
|
|
1,391.4
|
|
Fee per file
|
$1,346
|
|
$1,309
|
|
$1,394
|
|
$1,214
|
|
Actual title claims
paid
|
$132.1
|
|
$106.0
|
|
$349.8
|
|
$239.2
|
|
|
|
|
|
|
|
|
|
|
|
|
FIDELITY
NATIONAL FINANCIAL, INC.
THIRD
QUARTER SEGMENT INFORMATION
(In
millions, except order information in 000's)
(Unaudited)
|
|
|
|
|
|
|
|
Three Months Ended
September 30,
2010
|
Consolidated
|
FNT
|
Specialty
Insurance
|
Corporate
and
Other
|
|
Gross operating
revenue
|
$1,350.4
|
$1,215.4
|
$110.8
|
$24.2
|
|
|
|
|
|
|
|
Interest and investment
income
|
34.0
|
31.0
|
2.9
|
0.1
|
|
Realized gains and
losses
|
40.1
|
39.1
|
0.1
|
0.9
|
|
Total revenue
|
1,424.5
|
1,285.5
|
113.8
|
25.2
|
|
|
|
|
|
|
|
Personnel costs
|
405.1
|
377.9
|
12.1
|
15.1
|
|
Other operating
expenses
|
328.4
|
262.3
|
50.8
|
15.3
|
|
Agent commissions
|
427.5
|
427.5
|
--
|
--
|
|
Depreciation and
amortization
|
22.3
|
20.4
|
1.0
|
0.9
|
|
Claim loss expense
|
100.8
|
61.8
|
39.0
|
--
|
|
Interest expense
|
12.9
|
0.1
|
--
|
12.8
|
|
Total expenses
|
1,297.0
|
1,150.0
|
102.9
|
44.1
|
|
|
|
|
|
|
|
Pretax earnings from continuing
operations
|
127.5
|
135.5
|
10.9
|
(18.9)
|
|
|
|
|
|
|
|
Pretax margin
|
9.0%
|
10.5%
|
9.6%
|
--
|
|
|
|
|
|
|
|
Open orders
|
711.9
|
711.9
|
--
|
--
|
|
Closed orders
|
408.0
|
408.0
|
--
|
--
|
|
|
|
|
|
|
|
Three Months Ended
September 30,
2009
|
Consolidated
|
FNT
|
Specialty
Insurance
|
Corporate
and
Other
|
|
Gross operating
revenue
|
$1,419.9
|
$1,304.4
|
$99.3
|
$16.2
|
|
|
|
|
|
|
|
Interest and investment
income
|
36.7
|
34.0
|
3.0
|
(0.3)
|
|
Realized gains and
losses
|
10.6
|
10.4
|
0.2
|
--
|
|
Total revenue
|
1,467.2
|
1,348.8
|
102.5
|
15.9
|
|
|
|
|
|
|
|
Personnel costs
|
410.5
|
387.2
|
10.7
|
12.6
|
|
Other operating
expenses
|
343.9
|
284.9
|
46.1
|
12.9
|
|
Agent commissions
|
480.8
|
480.8
|
--
|
--
|
|
Depreciation and
amortization
|
23.1
|
20.7
|
1.3
|
1.1
|
|
Claim loss expense
|
92.5
|
55.4
|
37.1
|
--
|
|
Interest expense
|
8.0
|
--
|
--
|
8.0
|
|
Total expenses
|
1,358.8
|
1,229.0
|
95.2
|
34.6
|
|
|
|
|
|
|
|
Pretax earnings from continuing
operations
|
108.4
|
119.8
|
7.3
|
(18.7)
|
|
|
|
|
|
|
|
Pretax margin
|
7.4%
|
8.9%
|
7.1%
|
--
|
|
|
|
|
|
|
|
Open orders
|
568.6
|
568.6
|
--
|
--
|
|
Closed orders
|
438.7
|
438.7
|
--
|
--
|
|
|
|
|
|
|
|
|
FIDELITY
NATIONAL FINANCIAL, INC.
YTD SEGMENT
INFORMATION
(In
millions, except order information in '000's)
(Unaudited)
|
|
|
|
|
|
|
|
Nine Months Ended
September 30,
2010
|
Consolidated
|
FNT
|
Specialty
Insurance
|
Corporate
and
Other
|
|
Gross operating
revenue
|
$3,831.3
|
$3,452.9
|
$298.1
|
$80.3
|
|
|
|
|
|
|
|
Interest and investment
income
|
109.2
|
98.8
|
8.6
|
1.8
|
|
Realized gains and
losses
|
192.9
|
66.2
|
0.7
|
126.0
|
|
Total revenue
|
4,133.4
|
3,617.9
|
307.4
|
208.1
|
|
|
|
|
|
|
|
Personnel costs
|
1,173.5
|
1,092.7
|
36.1
|
44.7
|
|
Other operating
expenses
|
944.3
|
759.1
|
131.3
|
53.9
|
|
Agent commissions
|
1,247.8
|
1,247.8
|
--
|
--
|
|
Depreciation and
amortization
|
67.8
|
62.4
|
3.0
|
2.4
|
|
Claim loss expense
|
284.0
|
175.2
|
108.8
|
--
|
|
Interest expense
|
32.5
|
0.2
|
--
|
32.3
|
|
Total expenses
|
3,749.9
|
3,337.4
|
279.2
|
133.3
|
|
|
|
|
|
|
|
Pretax earnings from continuing
operations
|
383.5
|
280.5
|
28.2
|
74.8
|
|
|
|
|
|
|
|
Pretax margin
|
9.3%
|
7.8%
|
9.2%
|
35.9%
|
|
|
|
|
|
|
|
Open orders
|
1,774.1
|
1,774.1
|
--
|
--
|
|
Closed orders
|
1,102.4
|
1,102.4
|
--
|
--
|
|
|
|
|
|
|
|
Nine Months Ended
September 30,
2009
|
Consolidated
|
FNT
|
Specialty
Insurance
|
Corporate
and
Other
|
|
Gross operating
revenue
|
$4,242.2
|
$3,932.1
|
$276.6
|
$33.5
|
|
|
|
|
|
|
|
Interest and investment
income
|
112.9
|
104.9
|
9.4
|
(1.4)
|
|
Realized gains and
losses
|
18.1
|
18.0
|
1.5
|
(1.4)
|
|
Total revenue
|
4,373.2
|
4,055.0
|
287.5
|
30.7
|
|
|
|
|
|
|
|
Personnel costs
|
1,260.4
|
1,199.2
|
34.2
|
27.0
|
|
Other operating
expenses
|
1,024.0
|
873.4
|
120.9
|
29.7
|
|
Agent commissions
|
1,446.5
|
1,446.5
|
--
|
--
|
|
Depreciation and
amortization
|
84.7
|
78.2
|
3.9
|
2.6
|
|
Claim loss expense
|
290.2
|
196.7
|
93.5
|
--
|
|
Interest expense
|
28.4
|
0.6
|
--
|
27.8
|
|
Total expenses
|
4,134.2
|
3,794.6
|
252.5
|
87.1
|
|
|
|
|
|
|
|
Pretax earnings from continuing
operations
|
239.0
|
260.4
|
35.0
|
(56.4)
|
|
|
|
|
|
|
|
Pretax margin
|
5.5%
|
6.4%
|
12.2%
|
--
|
|
|
|
|
|
|
|
Open orders
|
2,060.8
|
2,060.8
|
--
|
--
|
|
Closed orders
|
1,391.4
|
1,391.4
|
--
|
--
|
|
|
|
|
|
|
|
|
FIDELITY
NATIONAL FINANCIAL, INC.
SUMMARY
BALANCE SHEET INFORMATION
(In
millions, except per share amounts)
|
|
|
|
September
30,
|
|
December
31,
|
|
|
|
2010
|
|
2009
|
|
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
Cash and investment
portfolio
|
|
$4,914.9
|
|
$4,887.5
|
|
Goodwill
|
|
1,473.5
|
|
1,455.2
|
|
Title plant
|
|
403.4
|
|
407.5
|
|
Total assets
|
|
7,879.0
|
|
7,934.3
|
|
Notes payable
|
|
802.0
|
|
861.9
|
|
Reserve for claim
losses
|
|
2,373.5
|
|
2,541.4
|
|
Secured trust
deposits
|
|
434.2
|
|
373.3
|
|
Total equity
|
|
3,478.0
|
|
3,344.8
|
|
Book value per
share
|
|
$15.25
|
|
$14.53
|
|
|
|
|
|
|
|
|
SOURCE Fidelity National Financial, Inc.
Copyright . 20 PR Newswire