JACKSONVILLE, Fla.,
Jan. 27, 2011 /PRNewswire/ --
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 twelve-month periods ended December 31, 2010.
|
|
|
Three Months
Ended
December 31,
2010
|
Three Months
Ended
December 31,
2009
|
|
Total revenue
|
$1.61
billion
|
$1.46
billion
|
|
Net earnings attributable to
common shareholders
|
$130.8
million
|
$69.3
million
|
|
Net earnings per diluted share
attributable to common shareholders
|
$0.58
|
$0.30
|
|
Cash flow from
operations
|
$113.3
million
|
$12.6
million
|
|
|
|
|
|
|
|
|
|
Twelve
Months
Ended
December 31,
2010
|
Twelve
Months
Ended
December 31,
2009
|
|
Total revenue
|
$5.74
billion
|
$5.83
billion
|
|
Net earnings attributable to
common shareholders
|
$370.1
million
|
$222.3
million
|
|
Net earnings per diluted share
attributable to common shareholders
|
$1.61
|
$0.97
|
|
Cash flow from
operations
|
$182.5
million
|
$380.3
million
|
|
|
|
|
|
|
The following are summary financial and operational results for
the operating segments of FNF for the three-month and twelve-month
periods ended December 31, 2010 and
2009:
Fidelity
National Title Group ("FNT")
|
|
|
|
|
Three Months
Ended
December 31,
2010
|
Three Months
Ended
December 31,
2009
|
|
Total revenue
|
$1.50
billion
|
$1.35
billion
|
|
Pre-tax earnings
|
$207.2
million
|
$110.8
million
|
|
Pre-tax margin
|
13.8%
|
8.2%
|
|
|
Twelve
Months
Ended
December 31,
2010
|
Twelve
Months
Ended
December 31,
2009
|
|
Total revenue
|
$5.15
billion
|
$5.41
billion
|
|
Pre-tax earnings
|
$491.0
million
|
$372.9
million
|
|
Pre-tax margin
|
9.5%
|
6.9%
|
|
Month
|
Direct
Orders Opened
|
Direct
Orders Closed
|
|
October 2010
|
236,700
|
151,800
|
|
November 2010
|
210,700
|
156,700
|
|
December 2010
|
163,900
|
163,400
|
|
Fourth Quarter
2010
|
611,300
|
471,900
|
|
|
|
|
|
October 2009
|
207,300
|
133,700
|
|
November 2009
|
172,400
|
127,100
|
|
December 2009
|
170,900
|
139,800
|
|
Fourth Quarter
2009
|
550,600
|
400,600
|
|
|
|
|
|
|
|
|
|
Open
Commercial
Orders
|
Closed
Commercial
Orders
|
Commercial
Revenue
(In
millions)
|
Commercial
Fee Per
File
|
|
4th Quarter 2010
|
18,900
|
12,600
|
$99.4
|
$7,900
|
|
4th Quarter 2009
|
18,200
|
13,000
|
$60.7
|
$4,700
|
|
- 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
December 31,
2010
|
Three Months
Ended
December 31,
2009
|
|
Total revenue
|
$96.9
million
|
$92.7
million
|
|
Pre-tax earnings
(loss)
|
($0.9)
million
|
$8.6
million
|
|
Pre-tax margin
|
N/A
|
9.3%
|
|
|
|
|
|
|
Twelve
Months
Ended
December 31,
2010
|
Twelve
Months
Ended
December 31,
2009
|
|
Total revenue
|
$404.3
million
|
$380.2
million
|
|
Pre-tax earnings
|
$27.3
million
|
$43.6
million
|
|
Pre-tax margin
|
6.8%
|
11.5%
|
|
|
|
|
|
|
"2010 was a successful year for FNF on a number of fronts," said
Chairman William P. Foley, II.
"The title insurance business experienced strong refinance
volumes due to the low mortgage interest rate environment and we
continued to closely manage our expense levels, producing our
strongest title earnings and pre-tax margin in a number of years.
The fourth quarter was particularly strong with a 13.8%
pre-tax margin. We remain the largest and most profitable
title company in the country, and despite a potentially more
challenging environment, we are focused on producing strong title
insurance earnings in 2011.
"Our Specialty Insurance group generated lower earnings in 2010.
Losses increased in the first quarter because of flooding in
the Northeast and soot and smoke damage from California fires. In the fourth quarter,
we incurred $13 million in losses due
to a severe October hailstorm in Phoenix.
"We were able to generate meaningful gains from our other
investments and portfolio companies. In the spring, we
realized a $26 million pre-tax gain
from the sale of MSX International bonds, a distressed debt
investment. On a percentage basis, that was a 120% gain in
approximately 12 months. In May, we also successfully closed
the sale of our 32% equity ownership stake in Sedgwick, generating
a pre-tax gain of approximately $98
million. The sale of Sedgwick clearly achieved our
on-going goal of creating significant value for our shareholders,
doubling our original investment, and was the culmination of a very
successful four-year investment for FNF. Finally, 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 for a
$22 million pre-tax gain. We
also own another 1.6 million shares of FIS with a current value of
approximately $50 million.
"We own approximately 47% of Remy International, an auto parts
manufacturer that recently completed a debt refinancing and a
common stock rights offering. In December
2010, Remy closed on a new five-year credit facility and a
new six-year term loan, using primarily the new term loan proceeds
to repay it's existing first, second and third lien term loans. In
the January common stock rights offering, eligible Remy
shareholders exercised rights for approximately 19.7 million shares
of common stock resulting in proceeds of approximately $217 million, including the tender of
approximately $93.5 million worth of
Remy preferred stock. The debt refinancing and recent rights
offering will reduce Remy's total debt plus preferred stock by
$211 million from $535 million to $324 million. Remy had a
strong operating turnaround in 2010, producing significantly
improved financial results and we are excited about the company's
business outlook, simplified capital structure and significantly
reduced fixed charge obligations arising from the common stock
rights offering. We can now turn our focus to a number of
strategic alternatives for Remy that could generate meaningful
value for FNF shareholders during 2011. Ceridian is a 33%
owned human resources, payroll, benefits and payments solution
provider that spent much of 2010 focused on cost reductions.
Under a new CEO, the emphasis will shift to improving revenue
growth and cross-selling in 2011. Cascade Timberlands, our
70% owned land holdings in Oregon,
has several transactions pending that could result in sales during
2011. Finally, American Blue Ribbon Holdings is 45% owned and
includes the Village Inn, Bakers Square and Max & Erma's
restaurant chains. American Blue Ribbon produced strong
results in 2010 and we are excited about their prospects for 2011.
We have a number of attractive companies and we are confident
that they will continue to generate meaningful value for our
shareholders over the next several years.
"The continued strength of our balance sheet and our liquidity
position was a priority during 2010. In March, we amended and
extended our existing credit facility, pushing the maturity date
out to March 2013. During May,
we also issued $300 million of 6.60%
senior notes with a May 2017
maturity. The net proceeds more than pre-fund the
$165 million of debt that matures in
August of 2011. In October, our Board of Directors set a
dividend payout target of 30% of 2010 net earnings for 2011 common
stock dividends. The combination of the credit facility
extension, the senior note issuance and the change in dividend
policy enhances our longer-term liquidity profile, continues our
strategy of conservatively managing our balance sheet and liquidity
position during uncertain times and provides additional holding
company financial flexibility throughout 2011.
"Despite the earnings strength in our title business and the
earnings contribution from our investments and portfolio companies,
FNF continues to trade below book value. During 2010, we
repurchased nearly 9 million shares of stock for approximately
$120 million, an average discount of
nearly 15% to our year-end book value of $15.39. The majority of those shares,
nearly 6 million, were repurchased in the fourth quarter of 2010.
Additionally, our Board of Directors has approved a five
million share increase to the existing stock repurchase program.
The stock repurchase program now authorizes the company to
repurchase up to 10 million shares of common stock through
July 31, 2012.
"We are proud of our accomplishments in 2010. The title
business produced its best earnings and pre-tax profit margin in a
number of years. We generated more than $145 million in pre-tax gains from our
investments and portfolio companies. We continued to
strengthen our balance sheet, focusing on enhancing our longer-term
liquidity profile. As always, we remain committed to our
ultimate goal of continuing to create value for our
shareholders."
Conference Call
FNF will host a call with investors and analysts to discuss
fourth quarter 2010 results on Friday,
January 28, 2011, beginning at 10:00
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 12:30 p.m. Eastern
time on January 28, 2011,
through February 4, 2011, by dialing
800-475-6701 (USA) or 320-365-3844
(International). The access code will be 187500.
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
|
|
Twelve
Months Ended
|
|
|
December
31,
|
|
December
31,
|
|
|
2010
|
|
2009
|
|
2010
|
|
2009
|
|
|
(Unaudited)
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
Direct title premiums
|
$420.9
|
|
$353.2
|
|
$1,404.5
|
|
$1,475.3
|
|
Agency title premiums
|
654.4
|
|
638.2
|
|
2,236.7
|
|
2,452.3
|
|
Total title
premiums
|
1,075.3
|
|
991.4
|
|
3,641.2
|
|
3,927.6
|
|
Escrow, title-related and other
fees
|
359.0
|
|
323.5
|
|
1,326.3
|
|
1,352.9
|
|
Total title and
escrow
|
1,434.3
|
|
1,314.9
|
|
4,967.5
|
|
5,280.5
|
|
|
|
|
|
|
|
|
|
|
Specialty insurance
|
93.5
|
|
89.4
|
|
391.6
|
|
366.0
|
|
Interest and investment
income
|
35.3
|
|
41.6
|
|
144.5
|
|
154.5
|
|
Realized gains and
losses
|
43.8
|
|
9.3
|
|
236.7
|
|
27.4
|
|
Total revenue
|
1,606.9
|
|
1,455.2
|
|
5,740.3
|
|
5,828.4
|
|
|
|
|
|
|
|
|
|
|
Personnel costs
|
436.6
|
|
389.4
|
|
1,610.1
|
|
1,649.8
|
|
Other operating
expenses
|
325.3
|
|
319.5
|
|
1,269.6
|
|
1,343.5
|
|
Agent commissions
|
510.9
|
|
505.2
|
|
1,758.7
|
|
1,951.7
|
|
Depreciation and
amortization
|
22.6
|
|
24.5
|
|
90.4
|
|
109.2
|
|
Claim loss expense
|
118.9
|
|
102.4
|
|
402.9
|
|
392.6
|
|
Interest expense
|
13.7
|
|
8.3
|
|
46.2
|
|
36.7
|
|
Total expenses
|
1,428.0
|
|
1,349.3
|
|
5,177.9
|
|
5,483.5
|
|
|
|
|
|
|
|
|
|
|
Earnings from continuing
operations before taxes
|
178.9
|
|
105.9
|
|
562.4
|
|
344.9
|
|
Income tax expense
|
51.4
|
|
38.7
|
|
185.6
|
|
106.8
|
|
Earnings from continuing
operations before equity investments
|
127.5
|
|
67.2
|
|
376.8
|
|
238.1
|
|
Earnings (loss) from equity
investments
|
5.0
|
|
2.3
|
|
(1.2)
|
|
(11.7)
|
|
Net earnings from continuing
operations
|
132.5
|
|
69.5
|
|
375.6
|
|
226.4
|
|
Loss from discontinued
operations, net of tax
|
--
|
|
--
|
|
--
|
|
(1.9)
|
|
Net earnings
|
132.5
|
|
69.5
|
|
375.6
|
|
224.5
|
|
Non-controlling
interests
|
1.7
|
|
0.2
|
|
5.5
|
|
2.2
|
|
Net earnings attributable to
common shareholders
|
$130.8
|
|
$69.3
|
|
$370.1
|
|
$222.3
|
|
Earnings per share:
|
|
|
|
|
|
|
|
|
Net earnings from
continuing operations and
attributable to common
shareholders - basic
|
$0.58
|
|
$0.30
|
|
$1.64
|
|
$0.99
|
|
Net earnings
from continuing operations
and
attributable to common shareholders -diluted
|
$0.58
|
|
$0.30
|
|
$1.61
|
|
$0.97
|
|
Weighted average shares –
basic
|
224.0
|
|
228.5
|
|
226.2
|
|
224.7
|
|
Weighted average shares –
diluted
|
227.0
|
|
231.7
|
|
229.3
|
|
228.5
|
|
|
|
|
|
|
|
|
|
|
Direct operations orders
opened (000's)
|
611.3
|
|
550.6
|
|
2,385.3
|
|
2,611.4
|
|
Direct operations orders
closed (000's)
|
471.9
|
|
400.6
|
|
1,574.3
|
|
1,792.0
|
|
Fee per file
|
$1,369
|
|
$1,368
|
|
$1,387
|
|
$1,248
|
|
Actual title claims
paid
|
$177.0
|
|
$148.9
|
|
$526.8
|
|
$388.1
|
|
|
|
|
|
|
|
|
|
|
|
|
FIDELITY
NATIONAL FINANCIAL, INC.
FOURTH
QUARTER SEGMENT INFORMATION
(In
millions, except order information in 000's)
(Unaudited)
|
|
|
|
|
|
|
|
Three Months
Ended
December 31,
2010
|
Consolidated
|
FNT
|
Specialty
Insurance
|
Corporate
and
Other
|
|
Gross operating
revenue
|
$1,527.8
|
$1,425.4
|
$93.5
|
$8.9
|
|
|
|
|
|
|
|
Interest and investment
income
|
35.3
|
32.4
|
2.9
|
--
|
|
Realized gains and
losses
|
43.8
|
44.5
|
0.5
|
(1.2)
|
|
Total revenue
|
1,606.9
|
1,502.3
|
96.9
|
7.7
|
|
|
|
|
|
|
|
Personnel costs
|
436.6
|
415.4
|
11.8
|
9.4
|
|
Other operating
expenses
|
325.3
|
274.5
|
39.4
|
11.4
|
|
Agent commissions
|
510.9
|
510.9
|
--
|
--
|
|
Depreciation and
amortization
|
22.6
|
20.5
|
1.4
|
0.7
|
|
Claim loss expense
|
118.9
|
73.7
|
45.2
|
--
|
|
Interest expense
|
13.7
|
0.1
|
--
|
13.6
|
|
Total expenses
|
1,428.0
|
1,295.1
|
97.8
|
35.1
|
|
|
|
|
|
|
|
Pretax earnings from continuing
operations
|
178.9
|
207.2
|
(0.9)
|
(27.4)
|
|
|
|
|
|
|
|
Pretax margin
|
11.1%
|
13.8%
|
--
|
--
|
|
|
|
|
|
|
|
Open orders
|
611.3
|
611.3
|
--
|
--
|
|
Closed orders
|
471.9
|
471.9
|
--
|
--
|
|
|
|
|
|
|
|
Three Months
Ended
December 31,
2009
|
Consolidated
|
FNT
|
Specialty
Insurance
|
Corporate
and
Other
|
|
Gross operating
revenue
|
$1,404.3
|
$1,304.3
|
$89.4
|
$10.6
|
|
|
|
|
|
|
|
Interest and investment
income
|
41.6
|
33.7
|
2.9
|
5.0
|
|
Realized gains and
losses
|
9.3
|
9.0
|
0.4
|
(0.1)
|
|
Total revenue
|
1,455.2
|
1,347.0
|
92.7
|
15.5
|
|
|
|
|
|
|
|
Personnel costs
|
389.4
|
370.4
|
11.1
|
7.9
|
|
Other operating
expenses
|
319.5
|
269.7
|
37.4
|
12.4
|
|
Agent commissions
|
505.2
|
505.2
|
--
|
--
|
|
Depreciation and
amortization
|
24.5
|
22.7
|
1.2
|
0.6
|
|
Claim loss expense
|
102.4
|
68.0
|
34.4
|
--
|
|
Interest expense
|
8.3
|
0.2
|
--
|
8.1
|
|
Total expenses
|
1,349.3
|
1,236.2
|
84.1
|
29.0
|
|
|
|
|
|
|
|
Pretax earnings from continuing
operations
|
105.9
|
110.8
|
8.6
|
(13.5)
|
|
|
|
|
|
|
|
Pretax margin
|
7.3%
|
8.2%
|
9.3%
|
--
|
|
|
|
|
|
|
|
Open orders
|
550.6
|
550.6
|
--
|
--
|
|
Closed orders
|
400.6
|
400.6
|
--
|
--
|
|
|
|
|
|
|
|
|
FIDELITY
NATIONAL FINANCIAL, INC.
FULL-YEAR
SEGMENT INFORMATION
(In
millions, except order information in '000's)
(Unaudited)
|
|
|
|
|
|
|
|
Twelve Months
Ended
December 31,
2010
|
Consolidated
|
FNT
|
Specialty
Insurance
|
Corporate
and
Other
|
|
Gross operating
revenue
|
$5,359.1
|
$4,910.9
|
$391.6
|
$56.6
|
|
|
|
|
|
|
|
Interest and investment
income
|
144.5
|
131.8
|
11.5
|
1.2
|
|
Realized gains and
losses
|
236.7
|
110.7
|
1.2
|
124.8
|
|
Total revenue
|
5,740.3
|
5,153.4
|
404.3
|
182.6
|
|
|
|
|
|
|
|
Personnel costs
|
1,610.1
|
1,527.1
|
47.9
|
35.1
|
|
Other operating
expenses
|
1,269.6
|
1,043.6
|
170.7
|
55.3
|
|
Agent commissions
|
1,758.7
|
1,758.7
|
--
|
--
|
|
Depreciation and
amortization
|
90.4
|
83.8
|
4.4
|
2.2
|
|
Claim loss expense
|
402.9
|
248.9
|
154.0
|
--
|
|
Interest expense
|
46.2
|
0.3
|
--
|
45.9
|
|
Total expenses
|
5,177.9
|
4,662.4
|
377.0
|
138.5
|
|
|
|
|
|
|
|
Pretax earnings from continuing
operations
|
562.4
|
491.0
|
27.3
|
44.1
|
|
|
|
|
|
|
|
Pretax margin
|
9.8%
|
9.5%
|
6.8%
|
24.2%
|
|
|
|
|
|
|
|
Open orders
|
2,385.3
|
2,385.3
|
--
|
--
|
|
Closed orders
|
1,574.3
|
1,574.3
|
--
|
--
|
|
|
|
|
|
|
|
Twelve Months
Ended
December 31,
2009
|
Consolidated
|
FNT
|
Specialty
Insurance
|
Corporate
and
Other
|
|
Gross operating
revenue
|
$5,646.5
|
$5,244.9
|
$366.0
|
$35.6
|
|
|
|
|
|
|
|
Interest and investment
income
|
154.5
|
138.9
|
12.3
|
3.3
|
|
Realized gains and
losses
|
27.4
|
27.0
|
1.9
|
(1.5)
|
|
Total revenue
|
5,828.4
|
5,410.8
|
380.2
|
37.4
|
|
|
|
|
|
|
|
Personnel costs
|
1,649.8
|
1,573.7
|
45.3
|
30.8
|
|
Other operating
expenses
|
1,343.5
|
1,145.7
|
158.3
|
39.5
|
|
Agent commissions
|
1,951.7
|
1,951.7
|
--
|
--
|
|
Depreciation and
amortization
|
109.2
|
101.3
|
5.1
|
2.8
|
|
Claim loss expense
|
392.6
|
264.7
|
127.9
|
--
|
|
Interest expense
|
36.7
|
0.8
|
--
|
35.9
|
|
Total expenses
|
5,483.5
|
5,037.9
|
336.6
|
109.0
|
|
|
|
|
|
|
|
Pretax earnings from continuing
operations
|
344.9
|
372.9
|
43.6
|
(71.6)
|
|
|
|
|
|
|
|
Pretax margin
|
5.9%
|
6.9%
|
11.5%
|
--
|
|
|
|
|
|
|
|
Open orders
|
2,611.4
|
2,611.4
|
--
|
--
|
|
Closed orders
|
1,792.0
|
1,792.0
|
--
|
--
|
|
|
|
|
|
|
|
|
FIDELITY
NATIONAL FINANCIAL, INC.
SUMMARY
BALANCE SHEET INFORMATION
(In
millions, except per share amounts)
|
|
|
|
December
31,
2010
|
|
December
31,
2009
|
|
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
Cash and investment
portfolio
|
|
$4,939.2
|
|
$4,887.5
|
|
Goodwill
|
|
1,470.7
|
|
1,455.2
|
|
Title plant
|
|
390.8
|
|
407.5
|
|
Total assets
|
|
7,893.6
|
|
7,934.4
|
|
Notes payable
|
|
952.0
|
|
861.9
|
|
Reserve for claim
losses
|
|
2,272.7
|
|
2,541.4
|
|
Secured trust
deposits
|
|
388.4
|
|
373.3
|
|
Total equity
|
|
3,444.4
|
|
3,344.9
|
|
Book value per
share
|
|
$15.39
|
|
$14.53
|
|
|
|
|
|
|
|
|
SOURCE Fidelity National Financial, Inc.