JACKSONVILLE, Fla.,
May 10, 2022 /PRNewswire/ -- Fidelity
National Financial, Inc. (NYSE:FNF) (the Company), a leading
provider of title insurance and transaction services to the real
estate and mortgage industries and a leading provider of insurance
solutions serving retail annuity and life customers and
institutional clients through FNF's wholly-owned subsidiary,
F&G, today reported financial results for the first quarter
ended March 31, 2022.
Net earnings attributable to common shareholders for
the first quarter of $397 million, or
$1.40 per diluted share (per share),
compared to $605 million, or
$2.08 per share, for the first
quarter of 2021. Net earnings attributable to common shareholders
for the first quarter of 2022 includes $28
million of net favorable mark-to-market effects and
$19 million of other unfavorable
items; all of which are excluded from adjusted net earnings
attributable to common shareholders.
Adjusted net earnings attributable to common shareholders
(adjusted net earnings) for the first quarter of
$388 million, or $1.37 per share, compared to $455 million, or $1.56 per share, for the first quarter of 2021.
The decrease from the prior year quarter was primarily driven by
Title's significant decrease in refinance volume relative to robust
levels seen early last year; partially offset by higher average fee
per file, strong commercial orders closed and sustained levels of
residential purchase orders closed. F&G's adjusted net
earnings for the first quarter of 2022 were $82 million, including $16
million of net unfavorable items, compared to $78 million, including $12
million of net favorable items, for the first quarter of
2021.
Company Highlights
- Stable Title Revenue: For the Title segment, total
revenue of $2.4 billion, compared to
$2.5 billion in total revenue in the
first quarter of 2021. Total revenue, excluding recognized
gains and losses, of $2.6 billion, in
line with the first quarter of 2021
- Growth strategy drives strong sales for F&G:
Total sales of $2.6 billion for the
first quarter, a 57% increase over first quarter 2021 and an 18%
increase over fourth quarter 2021, due to continued expansion in
new channels
- Partial spin-off of F&G announced to unlock the value of
both businesses: On March 16,
2022, FNF announced a planned transaction to distribute 15%
ownership of F&G to FNF shareholders on a pro rata basis; FNF
will retain control of F&G through an 85% ownership stake and
remains committed to F&G's growth and long-term success.
The transaction is expected to close in late third quarter or early
fourth quarter of 2022, subject to customary approvals
- Ample deployable capital supports shareholder value:
FNF has repurchased 2.75 million shares for a total
$134 million, at an average price of
$48.68 per share, in the first
quarter and paid common dividends at $0.44 per share for a total $124 million. FNF ended the first quarter
with $1.5 billion in cash and
short-term liquid investments at the holding company
William P. Foley, II, commented,
"We had great performance in the first quarter, despite the
economic and geopolitical challenges that persist, as we increased
total revenue by 2% to $3.2 billion
from the prior year. Our Title business was boosted by strong
demand in the commercial market and home price appreciation in the
residential purchase market, which offset the continued decline in
refinance volumes in the rising interest rate environment. F&G
continues to execute well on its diversified growth strategy and
delivered strong sales in the first quarter which, in turn, drives
growth in assets under management and profitability, particularly
in a rising interest rate environment. F&G provides our company
with a stable and countercyclical source of earnings that is poised
to benefit as interest rates rise."
Mr. Foley concluded, "We also remain committed to creating value
for our shareholders and believe that our plan to dividend 15%
ownership of F&G to FNF shareholders in the second half of this
year will help to unlock the market value of both industry leading
businesses. F&G has exceeded expectations since we closed on
the acquisition in June of 2020 and, by retaining 85% ownership of
F&G, we will continue to benefit from their growth which
positions F&G to provide strong cash flows and earnings to FNF
over the coming years. Looking forward, we expect to create
shareholder value through continued investment in our business and
returning capital to shareholders, as well as evaluating
strategically aligned acquisitions, to maintain attractive returns
for all of our stakeholders. With an ample capital position
at our holding company, we deployed $258
million through our quarterly dividend and share repurchase
program in the first quarter. This is ahead of pace with the
$907 million of capital returned to
our shareholders during full year 2021."
Summary Financial Results
|
Three Months
Ended
|
(in millions,
except per share data)
|
March 31,
2022
|
|
March 31,
2021
|
Total
revenue
|
$
3,165
|
|
$
3,100
|
F&G total
sales1
|
$
2,589
|
|
$
1,654
|
Total
assets
|
$
60,857
|
|
$
51,489
|
Adjusted pre-tax
title margin
|
17.1 %
|
|
19.9 %
|
Net earnings
attributable to common shareholders
|
$
397
|
|
$
605
|
Net earnings per
share attributable to common shareholders
|
$
1.40
|
|
$
2.08
|
Adjusted net
earnings1
|
$
388
|
|
$
455
|
Adjusted net earnings
per share1
|
$
1.37
|
|
$
1.56
|
Weighted average
common diluted shares
|
283
|
|
291
|
Total common shares
outstanding
|
281
|
|
289
|
1 See definition of non-GAAP measures
below
Segment Financial Results
Title
This segment consists of the operations of the Company's title
insurance underwriters and related businesses, which provide core
title insurance and escrow and other title-related services
including loan sub-servicing, valuations, default services, and
home warranty products.
First Quarter 2022 Highlights
Mike Nolan, Chief Executive
Officer, said, "I am pleased with the stability of our Title
business, as we delivered adjusted pre-tax title earnings of
$437 million and an adjusted pre-tax
title margin of 17.1% in the first quarter, despite significant
uncertainty and volatility in the macro environment. Strength
in residential purchase and commercial revenue helped to buffer the
ongoing contraction in refinance volumes, which hold a
significantly lower fee per file. Looking ahead in 2022, we
believe that we are well-positioned to navigate the effects of a
rising interest rate environment, with scale advantage as the
nationwide market leader, efficiencies from our innovative
technology enabled platform, and a disciplined operating strategy
and proven track record of quickly adjusting our operating model
for significant fluctuations in opened and closed orders."
- Total revenue of $2.4
billion, compared to $2.5
billion in total revenue in the first quarter of 2021
- Total revenue, excluding recognized gains and losses, of
$2.6 billion, in line with the first
quarter of 2021
-
- Direct title premiums of $767 million, a 3% increase over first quarter of
2021
- Agency title premiums of $1.1 billion, a 4% increase over first quarter of
2021
- Commercial revenue of $374
million, a 46% increase over first quarter of 2021
- Purchase orders opened decreased 1% on a daily
basis and purchase orders closed decreased 1% on a daily basis from
the first quarter of 2021
- Refinance orders opened decreased 57% on a daily
basis and refinance orders closed decreased 58% on a daily basis
from first quarter of 2021
- Commercial orders opened increased 6% and commercial
orders closed increased 7% over first quarter of 2021
- Total fee per file of $2,891 for the first quarter, a 49% increase over
first quarter of 2021
First Quarter 2022 Financial Results
- Pre-tax title margin of 10.4% and industry leading
adjusted pre-tax title margin of 17.1% for the first quarter
of 2022, compared to 17.4% and 19.9%, respectively, in the first
quarter of 2021
- Pre-tax earnings from continuing operations in Title for
the first quarter of $249 million,
compared to $439 million for the
first quarter of 2021
- Adjusted pre-tax earnings in Title for the first
quarter of $437 million compared to
$512 million for the first quarter of
2021. The decrease from the prior year quarter was primarily driven
by the significant decrease in the volume of refinance orders
closed relative to the robust levels seen last year; partially
offset by the higher average fee per file reflective of the current
mix of business, continued strength in commercial orders closed,
and sustained levels of residential purchase orders closed
F&G
This segment consists of operations of FNF's wholly-owned
subsidiary F&G, a leading provider of insurance solutions
serving retail annuity and life customers and funding agreement and
pension risk transfer institutional clients.
First Quarter 2022
Chris Blunt, President and Chief
Executive Officer of F&G, commented, "F&G is off to a
strong start in 2022, as demonstrated by our first quarter
results. We generated strong sales of $2.6 billion which, in turn, drove our assets
under management to $38.6
billion. In the retail channels, we have seen record
levels of submitted annuity premium in March and April, following
an inflection point from pricing actions taken in response to the
macro environment in the fourth quarter which carried into early
first quarter. Momentum continues in our institutional
channels and we closed our largest pension risk transfer
transaction to-date in the first quarter, with over $500 million of premium transferred."
Regarding the recently announced transaction to distribute 15%
ownership of F&G to FNF shareholders, Mr. Blunt said, "We are
making progress toward a targeted closing in late third quarter or
early fourth quarter of 2022. Overall, we are well positioned
for future growth opportunities and view the transition to being a
publicly traded company as a vote of confidence for our
business."
- Total sales of $2.6
billion for the first quarter, an increase of 57% over the
first quarter 2021 and an increase of 18% over fourth quarter 2021;
reflects successful execution of F&G's diversified growth
strategy and a disciplined approach to pricing
- Retail sales of $1.5
billion for the first quarter, in line with near record
sales in the first quarter 2021 and steady growth of 6% over fourth
quarter 2021
- Institutional sales of $1.1
billion for the first quarter, includes a $527 million pension risk transfer transaction
and $600 million of funding agreement
issuances, compared to $125 million
funding agreement issuance for the first quarter 2021; reflects
expansion in new markets
- Average assets under management (AAUM) of
$37.5 billion for the first quarter,
an increase of 29% from $29.0 billion
in the first quarter 2021, driven by net new business asset
flows. Ending assets under management were $38.6 billion as of March
31, 2022
- Net earnings attributable to common shareholders for
F&G of $236 million for the
first quarter, compared to $289
million for the first quarter of 2021
- Adjusted net earnings for F&G of $82 million for the first quarter, compared to
$78 million for the first quarter of
2021. Adjusted net earnings excluding notable items were
$98 million in the first quarter, an
increase of $32 million or 48%
compared to $66 million in the prior
year quarter, primarily driven by growth in assets under
management
-
- Net unfavorable items in first quarter of 2022 were
$16 million, including $38 million of income tax expense due to a
valuation allowance recorded against deferred tax assets related to
the past sale of discontinued operations, partially offset by
$22 million favorable items primarily
comprised of gains on collateralized loan obligation (CLO)
redemptions
- Net favorable items in first quarter of 2021 were $12 million, primarily as a result of favorable
mortality and gains on CLO redemptions
Conference Call
We will host a call with investors and analysts to discuss FNF's
first quarter 2022 results on Wednesday, May
11, 2022, 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 fnf.com. The conference call
replay will be available via webcast through the FNF Investor
Relations website at fnf.com. The telephone replay will be
available from 2:00 p.m. Eastern Time
on May 11, 2022, through May 18, 2022, by dialing 1-844-512-2921
(USA) or 1-412-317-6671
(International). The access code will be 13728494. An expanded
quarterly financial supplement providing F&G segment results is
available on the FNF Investor Relations website.
About Fidelity National Financial, Inc.
Fidelity National Financial, Inc. (NYSE: FNF) is a leading
provider of title insurance 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. More
information about FNF can be found at fnf.com.
About F&G
F&G is part of the FNF family of companies. F&G is
committed to helping Americans turn their aspirations into reality.
F&G is a leading provider of insurance solutions serving retail
annuity and life customers and institutional clients and is
headquartered in Des Moines, Iowa.
For more information, please visit fglife.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, this earnings release
includes non-GAAP financial measures, which the Company believes
are useful to help investors better understand its financial
performance, competitive position and prospects for the future.
These non-GAAP measures include adjusted net earnings per share,
adjusted pre-tax title earnings, adjusted pre-tax title earnings as
a percentage of adjusted title revenue (adjusted pre-tax title
margin), adjusted net earnings attributable to common shareholders
(adjusted net earnings), net investment spread, assets under
management (AUM), average assets under management (AAUM) and
sales.
Management believes these non-GAAP financial measures may be
useful in certain instances to provide additional meaningful
comparisons between current results and results in prior operating
periods. Our non-GAAP measures may not be comparable to
similarly titled measures of other organizations because other
organizations may not calculate such non-GAAP measures in the same
manner as we do.
The presentation of this financial information is not intended
to be considered in isolation of or as a substitute for, or
superior to, the financial information prepared and presented in
accordance with GAAP. By disclosing these non-GAAP financial
measures, FNF believes it offers investors a greater understanding
of, and an enhanced level of transparency into, the means by which
the Company's management operates the Company.
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, net earnings
attributable to common shareholders, net earnings per share, or any
other measures derived in accordance with GAAP as measures of
operating performance or liquidity. Further, FNF's non-GAAP
measures may be calculated differently from similarly titled
measures of other companies. Reconciliations of these non-GAAP
financial measures to the most directly comparable GAAP measures
are provided below.
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. The risks
and uncertainties which forward-looking statements are subject to
include, but are not limited to: the potential impact of the
consummation of the F&G transaction on relationships, including
with employees, suppliers, customers and competitors; changes in
general economic, business, political and COVID-19 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; our
dependence on distributions from our title insurance underwriters
as a main source of cash flow; significant competition that F&G
and 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 FNF's Form 10-K
and other filings with the Securities and Exchange Commission
(SEC).
FNF-E
SOURCE: Fidelity National Financial, Inc.
|
|
FIDELITY NATIONAL
FINANCIAL, INC.
|
FIRST QUARTER
SEGMENT INFORMATION
|
(In millions, except
order information in thousands)
|
(Unaudited)
|
|
|
Consolidated
|
|
Title
|
|
F&G
|
|
Corporate and
Other
|
Three Months
Ended
|
|
|
|
|
March 31,
2022
|
|
|
|
|
Direct title
premiums
|
|
$
767
|
|
$
767
|
|
$
—
|
|
$
—
|
Agency title
premiums
|
|
1,099
|
|
1,099
|
|
—
|
|
—
|
Escrow, title related
and other fees
|
|
1,290
|
|
665
|
|
594
|
|
31
|
Total title and
escrow
|
|
3,156
|
|
2,531
|
|
594
|
|
31
|
|
|
|
|
|
|
|
|
|
Interest and
investment income
|
|
478
|
|
27
|
|
451
|
|
—
|
Recognized gains and
losses, net
|
|
(469)
|
|
(175)
|
|
(297)
|
|
3
|
Total
revenue
|
|
3,165
|
|
2,383
|
|
748
|
|
34
|
|
|
|
|
|
|
|
|
|
Personnel
costs
|
|
823
|
|
776
|
|
30
|
|
17
|
Agent
commissions
|
|
844
|
|
844
|
|
—
|
|
—
|
Other operating
expenses
|
|
442
|
|
397
|
|
18
|
|
27
|
Benefits & other
policy reserve changes
|
|
208
|
|
—
|
|
208
|
|
—
|
Depreciation and
amortization
|
|
182
|
|
33
|
|
143
|
|
6
|
Provision for title
claim losses
|
|
84
|
|
84
|
|
—
|
|
—
|
Interest
expense
|
|
30
|
|
—
|
|
8
|
|
22
|
Total
expenses
|
|
2,613
|
|
2,134
|
|
407
|
|
72
|
|
|
|
|
|
|
|
|
|
Pre-tax earnings
(loss) from continuing operations
|
|
$
552
|
|
$
249
|
|
$
341
|
|
$
(38)
|
|
|
|
|
|
|
|
|
|
Income tax
expense (benefit)
|
|
155
|
|
57
|
|
105
|
|
(7)
|
Earnings
(loss) from equity investments
|
|
2
|
|
2
|
|
—
|
|
—
|
Earnings
(loss) from discontinued operations, net of tax
|
|
—
|
|
—
|
|
—
|
|
—
|
Non-controlling interests
|
|
2
|
|
3
|
|
—
|
|
(1)
|
|
|
|
|
|
|
|
|
|
Net earnings
(loss) attributable to common shareholders
|
|
$
397
|
|
$
191
|
|
$
236
|
|
$
(30)
|
|
|
|
|
|
|
|
|
|
EPS from
continuing operations attributable to common shareholders -
basic
|
|
$
1.41
|
|
|
|
|
|
|
EPS from
discontinued operations attributable to common shareholders -
basic
|
|
—
|
|
|
|
|
|
|
EPS attributable
to common shareholders - basic
|
|
$
1.41
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EPS from
continuing operations attributable to common shareholders -
diluted
|
|
$
1.40
|
|
|
|
|
|
|
EPS from
discontinued operations attributable to common shareholders -
diluted
|
|
—
|
|
|
|
|
|
|
EPS attributable
to common shareholders - diluted
|
|
$
1.40
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
shares - basic
|
|
281
|
|
|
|
|
|
|
Weighted average
shares - diluted
|
|
283
|
|
|
|
|
|
|
|
|
|
FIDELITY NATIONAL
FINANCIAL, INC.
|
FIRST QUARTER
SEGMENT INFORMATION
|
(In millions, except
order information in thousands)
|
(Unaudited)
|
|
|
|
Consolidated
|
|
Title
|
|
F&G
|
|
Corporate and
Other
|
Three Months
Ended
|
|
|
|
|
March 31,
2022
|
|
|
|
|
Net earnings
(loss) attributable to common shareholders
|
|
$
397
|
|
$
191
|
|
$
236
|
|
$
(30)
|
|
|
|
|
|
|
|
|
|
Earnings from
discontinued operations, net of tax
|
|
—
|
|
—
|
|
—
|
|
—
|
|
|
|
|
|
|
|
|
|
Net earnings
(loss) from continuing operations attributable to common
shareholders
|
|
$
397
|
|
$
191
|
|
$
236
|
|
$
(30)
|
|
|
|
|
|
|
|
|
|
Pre-tax earnings
(loss) from continuing operations
|
|
$
552
|
|
$
249
|
|
$
341
|
|
$
(38)
|
|
|
|
|
|
|
|
|
|
Non-GAAP
Adjustments
|
|
|
|
|
|
|
|
|
Recognized
(gains) and losses, net
|
|
139
|
|
175
|
|
(33)
|
|
(3)
|
Indexed
product related derivatives
|
|
(168)
|
|
—
|
|
(168)
|
|
—
|
Purchase price
amortization
|
|
23
|
|
13
|
|
6
|
|
4
|
Transaction
costs
|
|
2
|
|
—
|
|
—
|
|
2
|
|
|
|
|
|
|
|
|
|
Adjusted pre-tax
earnings (loss)
|
|
$
548
|
|
$
437
|
|
$
146
|
|
$
(35)
|
|
|
|
|
|
|
|
|
|
Total non-GAAP,
pre-tax adjustments
|
|
$
(4)
|
|
$
188
|
|
$
(195)
|
|
$
3
|
Income taxes
on non-GAAP adjustments
|
|
(5)
|
|
(45)
|
|
41
|
|
(1)
|
Total non-GAAP
adjustments
|
|
$
(9)
|
|
$
143
|
|
$
(154)
|
|
$
2
|
|
|
|
|
|
|
|
|
|
Adjusted net
earnings (loss) from continuing operations attributable to common
shareholders
|
|
$
388
|
|
$
334
|
|
$
82
|
|
$
(28)
|
|
|
|
|
|
|
|
|
|
Adjusted EPS from
continuing operations attributable to common shareholders -
diluted
|
|
1.37
|
|
|
|
|
|
|
|
|
|
FIDELITY NATIONAL
FINANCIAL, INC.
|
FIRST QUARTER
SEGMENT INFORMATION
|
(In millions, except
order information in thousands)
|
(Unaudited)
|
|
|
|
Consolidated
|
|
Title
|
|
F&G
|
|
Corporate and
Other
|
Three Months
Ended
|
|
|
|
|
March 31,
2021
|
|
|
|
|
Direct title
premiums
|
|
$
746
|
|
$
746
|
|
$
—
|
|
$
—
|
Agency title
premiums
|
|
1,058
|
|
1,058
|
|
—
|
|
—
|
Escrow, title related
and other fees
|
|
851
|
|
745
|
|
64
|
|
42
|
Total title and
escrow
|
|
2,655
|
|
2,549
|
|
64
|
|
42
|
|
|
|
|
|
|
|
|
|
Interest and
investment income
|
|
402
|
|
29
|
|
373
|
|
—
|
Recognized gains and
losses, net
|
|
43
|
|
(59)
|
|
102
|
|
—
|
Total
revenue
|
|
3,100
|
|
2,519
|
|
539
|
|
42
|
|
|
|
|
|
|
|
|
|
Personnel
costs
|
|
812
|
|
754
|
|
29
|
|
29
|
Agent
commissions
|
|
807
|
|
807
|
|
—
|
|
—
|
Other operating
expenses
|
|
458
|
|
405
|
|
28
|
|
25
|
Benefits & other
policy reserve changes
|
|
(26)
|
|
—
|
|
(26)
|
|
—
|
Depreciation and
amortization
|
|
183
|
|
33
|
|
144
|
|
6
|
Provision for title
claim losses
|
|
81
|
|
81
|
|
—
|
|
—
|
Interest
expense
|
|
28
|
|
—
|
|
8
|
|
20
|
Total
expenses
|
|
2,343
|
|
2,080
|
|
183
|
|
80
|
|
|
|
|
|
|
|
|
|
Pre-tax earnings
(loss)
|
|
$
757
|
|
$
439
|
|
$
356
|
|
$
(38)
|
|
|
|
|
|
|
|
|
|
Income tax
expense (benefit)
|
|
166
|
|
103
|
|
72
|
|
(9)
|
Earnings from
equity investments
|
|
13
|
|
8
|
|
—
|
|
5
|
Earnings
(loss) from discontinued operations, net of tax
|
|
5
|
|
—
|
|
5
|
|
—
|
Non-controlling interests
|
|
4
|
|
4
|
|
—
|
|
—
|
|
|
|
|
|
|
|
|
|
Net earnings
(loss) attributable to common shareholders
|
|
$
605
|
|
$
340
|
|
$
289
|
|
$
(24)
|
|
|
|
|
|
|
|
|
|
EPS from
continuing operations attributable to common shareholders -
basic
|
|
$
2.07
|
|
|
|
|
|
|
EPS from
discontinued operations attributable to common shareholders -
basic
|
|
$
0.02
|
|
|
|
|
|
|
EPS attributable
to common shareholders - basic
|
|
$
2.09
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EPS from
continuing operations attributable to common shareholders -
diluted
|
|
$
2.06
|
|
|
|
|
|
|
EPS from
discontinued operations attributable to common shareholders -
diluted
|
|
$
0.02
|
|
|
|
|
|
|
EPS attributable
to common shareholders - diluted
|
|
$
2.08
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
shares - basic
|
|
289
|
|
|
|
|
|
|
Weighted average
shares - diluted
|
|
291
|
|
|
|
|
|
|
|
|
|
FIDELITY NATIONAL
FINANCIAL, INC.
|
FIRST QUARTER
SEGMENT INFORMATION
|
(In millions, except
order information in thousands)
|
(Unaudited)
|
|
|
|
Consolidated
|
|
Title
|
|
F&G
|
|
Corporate and
Other
|
Three Months
Ended
|
|
|
|
|
March 31,
2021
|
|
|
|
|
Net earnings
(loss) attributable to common shareholders
|
|
$
605
|
|
$
340
|
|
$
289
|
|
$
(24)
|
|
|
|
|
|
|
|
|
|
Earnings from
discontinued operations, net of tax
|
|
$
5
|
|
$
—
|
|
$
5
|
|
$
—
|
|
|
|
|
|
|
|
|
|
Net earnings
(loss) from continuing operations, attributable to common
shareholders
|
|
$
600
|
|
$
340
|
|
$
284
|
|
$
(24)
|
|
|
|
|
|
|
|
|
|
Pre-tax earnings
(loss) from continuing operations
|
|
757
|
|
439
|
|
356
|
|
(38)
|
|
|
|
|
|
|
|
|
|
Non-GAAP
Adjustments
|
|
|
|
|
|
|
|
|
Recognized
(gains) and losses, net
|
|
(23)
|
|
59
|
|
(82)
|
|
—
|
Indexed
product related derivatives
|
|
(185)
|
|
—
|
|
(185)
|
|
—
|
Purchase price
amortization
|
|
25
|
|
14
|
|
7
|
|
4
|
Transaction
costs
|
|
6
|
|
—
|
|
2
|
|
4
|
|
|
|
|
|
|
|
|
|
Adjusted pre-tax
earnings (loss)
|
|
$
580
|
|
$
512
|
|
$
98
|
|
$
(30)
|
|
|
|
|
|
|
|
|
|
Total non-GAAP,
pre-tax adjustments
|
|
$
(177)
|
|
$
73
|
|
$
(258)
|
|
$
8
|
Income taxes
on non-GAAP adjustments
|
|
32
|
|
(18)
|
|
52
|
|
(2)
|
Total non-GAAP
adjustments
|
|
$
(145)
|
|
$
55
|
|
$
(206)
|
|
$
6
|
|
|
|
|
|
|
|
|
|
Adjusted net
earnings attributable to common shareholders
|
|
$
455
|
|
$
395
|
|
$
78
|
|
$
(18)
|
|
|
|
|
|
|
|
|
|
Adjusted EPS
attributable to common shareholders - diluted
|
|
$
1.56
|
|
|
|
|
|
|
|
|
|
FIDELITY NATIONAL
FINANCIAL, INC.
|
SUMMARY BALANCE
SHEET INFORMATION
|
(In
millions)
|
|
|
|
March 31,
2022
|
|
December 31,
2021
|
|
|
(Unaudited)
|
|
(Unaudited)
|
Cash and investment
portfolio
|
|
|
$
46,520
|
|
|
$
47,135
|
Goodwill
|
|
|
4,539
|
|
|
4,539
|
Title
plant
|
|
|
400
|
|
|
400
|
Total
assets
|
|
|
60,857
|
|
|
60,690
|
Notes
payable
|
|
|
3,095
|
|
|
3,096
|
Reserve for title
claim losses
|
|
|
1,912
|
|
|
1,883
|
Secured trust
deposits
|
|
|
970
|
|
|
934
|
Non-controlling
interests
|
|
|
41
|
|
|
43
|
Total equity and
non-controlling interests
|
|
|
8,118
|
|
|
9,457
|
Total equity
attributable to common shareholders
|
|
|
8,077
|
|
|
9,414
|
|
|
|
Non-GAAP Measures
and Other Information
|
|
Title
|
|
The table below
reconciles pre-tax title earnings to adjusted pre-tax title
earnings.
|
|
|
Three Months
Ended
|
(Dollars in
millions)
|
March 31,
2022
|
March 31,
2021
|
Pre-tax
earnings
|
$
249
|
$
439
|
Non-GAAP adjustments
before taxes
|
|
|
Recognized
(gains) and losses, net
|
175
|
59
|
Purchase price
amortization
|
13
|
14
|
Total non-GAAP
adjustments
|
188
|
73
|
Adjusted pre-tax
earnings
|
$
437
|
$
512
|
Adjusted pre-tax
margin
|
17.1
%
|
19.9
%
|
|
|
|
FIDELITY NATIONAL
FINANCIAL, INC.
|
QUARTERLY
OPERATING STATISTICS
|
(Unaudited)
|
|
|
|
Q1
2022
|
|
Q4
2021
|
|
Q3
2021
|
|
Q2
2021
|
|
Q1
2021
|
|
Q4
2020
|
|
Q3
2020
|
|
Q2
2020
|
Quarterly Opened
Orders ('000's except % data)
|
Total opened
orders*
|
|
522
|
|
536
|
|
688
|
|
695
|
|
770
|
|
728
|
|
847
|
|
693
|
Total opened orders
per day*
|
|
8.6
|
|
8.5
|
|
10.8
|
|
10.9
|
|
12.6
|
|
11.6
|
|
13.2
|
|
10.8
|
Purchase % of opened
orders
|
|
62%
|
|
53%
|
|
50%
|
|
53%
|
|
42%
|
|
38%
|
|
40%
|
|
37%
|
Refinance % of opened
orders
|
|
38%
|
|
47%
|
|
50%
|
|
47%
|
|
58%
|
|
62%
|
|
60%
|
|
63%
|
Total closed
orders*
|
|
380
|
|
477
|
|
527
|
|
568
|
|
597
|
|
617
|
|
571
|
|
487
|
Total closed orders
per day*
|
|
6.2
|
|
7.6
|
|
8.2
|
|
8.9
|
|
9.8
|
|
9.8
|
|
8.9
|
|
7.6
|
Purchase % of closed
orders
|
|
55%
|
|
51%
|
|
50%
|
|
47%
|
|
34%
|
|
38%
|
|
42%
|
|
35%
|
Refinance % of closed
orders
|
|
45%
|
|
49%
|
|
50%
|
|
53%
|
|
66%
|
|
62%
|
|
58%
|
|
65%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Commercial
(millions, except orders in '000's)
|
Total commercial
revenue
|
|
$
374
|
|
$
546
|
|
$
366
|
|
$
347
|
|
$
257
|
|
$
322
|
|
$
216
|
|
$
184
|
Total commercial
opened orders
|
|
66.1
|
|
64.5
|
|
66.8
|
|
69.4
|
|
62.2
|
|
57.0
|
|
58.1
|
|
43.9
|
Total commercial
closed orders
|
|
37.4
|
|
46.1
|
|
40.1
|
|
42.3
|
|
34.8
|
|
39.5
|
|
30.6
|
|
25.7
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
National commercial
revenue
|
|
$
196
|
|
$
313
|
|
$
183
|
|
$
176
|
|
$
127
|
|
$
177
|
|
$
113
|
|
$
96
|
National commercial
opened orders
|
|
27.5
|
|
26.0
|
|
27.7
|
|
27.4
|
|
23.4
|
|
21.4
|
|
21.7
|
|
15.2
|
National commercial
closed orders
|
|
14.6
|
|
18.1
|
|
14.8
|
|
14.9
|
|
11.2
|
|
13.4
|
|
9.8
|
|
8.8
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Fee Per
File
|
Fee per
file
|
|
$
2,891
|
|
$
3,023
|
|
$
2,581
|
|
$
2,444
|
|
$
1,944
|
|
$
2,116
|
|
$
2,063
|
|
$
1,889
|
Residential fee per
file
|
|
$
2,188
|
|
$
2,158
|
|
$
2,097
|
|
$
2,030
|
|
$
1,644
|
|
$
1,661
|
|
$
1,803
|
|
$
1,614
|
Total commercial fee
per file
|
|
$ 10,000
|
|
$
11,800
|
|
$
9,100
|
|
$
8,200
|
|
$
7,400
|
|
$
8,200
|
|
$
7,100
|
|
$
7,200
|
National commercial
fee per file
|
|
$ 13,400
|
|
$
17,300
|
|
$
12,400
|
|
$
11,800
|
|
$ 11,300
|
|
$
13,200
|
|
$
11,500
|
|
$
10,900
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
Staffing
|
Total field
operations employees
|
|
13,400
|
|
13,600
|
|
13,700
|
|
13,500
|
|
13,200
|
|
12,800
|
|
12,300
|
|
10,900
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Actual title
claims paid ($ millions)
|
|
$
54
|
|
$
62
|
|
$
55
|
|
$
56
|
|
$
46
|
|
$
54
|
|
$
50
|
|
$
51
|
|
|
|
Title
(continued)
|
|
FIDELITY NATIONAL
FINANCIAL, INC.
|
MONTHLY TITLE
ORDER STATISTICS
|
|
|
|
|
Direct Orders
Opened *
|
|
|
Direct Orders
Closed *
|
Month
|
|
/ (%
Purchase)
|
|
/ (%
Purchase)
|
January
2022
|
|
|
166,000
|
57%
|
|
|
119,000
|
50%
|
February
2022
|
|
|
165,000
|
61%
|
|
|
118,000
|
54%
|
March 2022
|
|
|
191,000
|
68%
|
|
|
143,000
|
60%
|
|
|
|
|
|
|
|
First Quarter
2022
|
|
|
522,000
|
62%
|
|
|
380,000
|
55%
|
|
|
|
|
|
|
|
|
|
|
Direct Orders
Opened *
|
|
|
Direct Orders
Closed *
|
Month
|
|
/ (%
Purchase)
|
|
|
/ (%
Purchase)
|
January
2021
|
|
|
256,000
|
37%
|
|
|
179,000
|
32%
|
February
2021
|
|
|
252,000
|
40%
|
|
|
188,000
|
32%
|
March 2021
|
|
|
262,000
|
49%
|
|
|
230,000
|
37%
|
|
|
|
|
|
|
|
First Quarter
2021
|
|
|
770,000
|
42%
|
|
|
597,000
|
34%
|
* Includes an
immaterial number of non-purchase and non-refinance
orders
|
|
|
|
F&G
|
|
The table below
reconciles net earnings attributable to common shareholders to
adjusted net earnings from continuing operations attributable to
common shareholders.
|
|
|
Three Months
Ended
|
|
March 31,
2022
|
|
March 31,
2021
|
(Dollars in
millions)
|
|
|
|
Net earnings
(loss) attributable to common shareholders
|
$
236
|
|
$
289
|
Less: Earnings (loss)
from discontinued operations, net of tax
|
—
|
|
5
|
Net earnings (loss)
from continuing operations attributable to common
shareholders
|
$
236
|
|
$
284
|
Non-GAAP
adjustments(1,2):
|
|
|
|
Recognized
(gains) and losses, net
|
(33)
|
|
(82)
|
Indexed
product related derivatives
|
(168)
|
|
(185)
|
Purchase price
amortization
|
6
|
|
7
|
Transaction
costs
|
—
|
|
2
|
Income taxes
on non-GAAP adjustments
|
41
|
|
52
|
Adjusted net
earnings from continuing operations attributable to common
shareholders(1)
|
$
82
|
|
$
78
|
Adjusted net earnings from continuing operations attributable to
common shareholders include $16
million of net unfavorable and $12
million of net favorable items in the three months ended
March 31, 2022 and March 31, 2021, respectively.
The table below provides summary financial highlights.
|
Three Months
Ended
|
(Dollars in
millions)
|
March 31,
2022
|
|
March 31,
2021
|
Average assets under
management (AAUM)(1)
|
$
37,459
|
|
$
29,016
|
Net investment spread
- FIA(1)
|
3.42 %
|
|
2.98 %
|
Net investment spread
- All products(1)
|
2.89 %
|
|
2.55 %
|
Net earnings (loss)
from continuing operations attributable to common
shareholders
|
$
236
|
|
$
284
|
Adjusted net earnings
from continuing operations attributable to common
shareholders(1)
|
$
82
|
|
$
78
|
The table below provides a summary of sales highlights.
|
|
Three Months
Ended
|
(In
millions)
|
|
March 31,
2022
|
|
March 31,
2021
|
Total annuity
sales(1)
|
|
$
1,435
|
|
$
1,514
|
Indexed universal
life sales(1)
|
|
$
27
|
|
$
15
|
Institutional
sales(1)(3)
|
|
$
1,127
|
|
$
125
|
Total
sales(1)
|
|
$
2,589
|
|
$
1,654
|
Footnotes:
- Non-GAAP financial measure. See the Non-GAAP Measures section
below for additional information.
- Amounts are net of offsets related to value of business
acquired (VOBA), deferred acquisition cost (DAC), deferred sale
inducement (DSI) amortization, and unearned revenue (UREV)
amortization, as applicable.
- Institutional sales include funding agreements (FABN/FHLB) and
pension risk transfer.
DEFINITIONS
The following represents the definitions of non-GAAP measures
used by the Company.
Adjusted Net Earnings Attributable to Common Shareholders
(Adjusted Net Earnings)
Adjusted net earnings is a non-GAAP economic measure we use to
evaluate financial performance each period. Adjusted net earnings
is calculated by adjusting net earnings (loss) from continuing
operations attributable to common shareholders to eliminate:
- Recognized (gains) and losses, net: the impact of net
investment gains/losses, including changes in allowance for
expected credit losses and other than temporary impairment ("OTTI")
losses, recognized in operations; the impact of market volatility
on the alternative asset portfolio that differ from management's
expectation of returns over the life of these assets; and the
effect of changes in fair value of the reinsurance related embedded
derivative;
- Indexed product related derivatives: the impacts related to
changes in the fair value, including both realized and unrealized
gains and losses, of index product related derivatives and embedded
derivatives, net of hedging cost;
- Purchase price amortization: the impacts related to the
amortization of certain intangibles (internally developed software,
trademarks and value of distribution asset (VODA)) recognized as a
result of acquisition activities;
- Transaction costs: the impacts related to acquisition,
integration and merger related items; and
- Other "non-recurring", "infrequent" or "unusual items":
Management excludes certain items determined to be "non-recurring",
"infrequent" or "unusual" from adjusted net earnings when incurred
if it is determined these expenses are not a reflection of the core
business and when the nature of the item is such that it is not
reasonably likely to recur within two years and/or there was not a
similar item in the preceding two years.
Adjustments to adjusted net earnings are net of the
corresponding impact on amortization of intangibles, as
appropriate. The income tax impact related to these adjustments is
measured using an effective tax rate, as appropriate by tax
jurisdiction. While these adjustments are an integral part of the
overall performance of F&G, market conditions and/or the
non-operating nature of these items can overshadow the underlying
performance of the core business. Accordingly, management considers
this to be a useful measure internally and to investors and
analysts in analyzing the trends of our operations. Adjusted net
earnings should not be used as a substitute for net earnings
(loss). However, we believe the adjustments made to net earnings
(loss) in order to derive adjusted net earnings provide an
understanding of our overall results of operations.
Net Investment Spread
Net investment spread is the excess of net investment income,
adjusted for market volatility on the alternative asset investment
portfolio, earned over the sum of interest credited to
policyholders and the cost of hedging our risk on indexed product
policies. Management considers this non-GAAP financial
measure to be useful internally and to investors and analysts when
assessing the performance of the Company's invested assets against
the level of investment return provided to policyholders, inclusive
of hedging costs.
Assets Under Management (AUM)
AUM is calculated as the sum of:
- total invested assets at amortized cost, excluding derivatives,
net of reinsurance qualifying for risk transfer in accordance with
GAAP;
- related party loans and investments;
- accrued investment income;
- the net payable/receivable for the purchase/sale of
investments, and
- cash and cash equivalents excluding derivative collateral at
the beginning of the period and the end of each month in the
period, divided by the total number of months in the period plus
one.
Management considers this non-GAAP financial measure to be
useful internally and to investors and analysts when assessing the
rate of return on assets available for reinvestment.
Average Assets Under Management (AAUM)
AAUM is calculated as AUM at the beginning of the period and the
end of each month in the period, divided by the total number of
months in the period plus one.
Management considers this non-GAAP financial measure to be
useful internally and to investors and analysts when assessing the
rate of return on assets available for reinvestment.
Sales
Annuity, IUL, funding agreement and non-life contingent PRT
sales are not derived from any specific GAAP income statement
accounts or line items and should not be viewed as a substitute for
any financial measure determined in accordance with GAAP.
Sales from these products are recorded as deposit liabilities (i.e.
contractholder funds) within the Company's consolidated financial
statements in accordance with GAAP. Life contingent PRT sales are
recorded as premiums in revenues within the consolidated financial
statements. Management believes that presentation of sales, as
measured for management purposes, enhances the understanding of our
business and helps depict longer term trends that may not be
apparent in the results of operations due to the timing of sales
and revenue recognition.
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SOURCE Fidelity National Financial, Inc.; FGL Holdings