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  • FNF Reports First Quarter 2024 Financial Results

    May 14, 2024 by Fidelity National Financial, Inc.


    JACKSONVILLE, Fla.May 8, 2024 /PRNewswire/ — Fidelity National Financial, Inc. (NYSE: FNF) (“FNF” or 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 its majority-owned, publicly traded subsidiary F&G Annuities & Life, Inc. (NYSE :FG) (“F&G”), today reported financial results for the first quarter ended March 31, 2024.

    Net earnings attributable to common shareholders for the first quarter were $248 million, or $0.91 per diluted share (per share), compared to a net loss of $59 million, or $0.22 per share, for the first quarter of 2023. Net earnings attributable to common shareholders include mark-to-market effects and non-recurring 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 were $206 million, or $0.76 per share, compared to $151 million, or $0.56 per share, for the first quarter of 2023. The Title Segment contributed $130 million, compared to $115 million for the first quarter of 2023. The F&G Segment contributed $95 million, compared to $52 million for the first quarter of 2023. The Corporate Segment had adjusted net earnings of $8 million before eliminating $27 million of dividend income from F&G in the consolidated financial statements, compared to adjusted net losses of $16 million for the first quarter of 2023. The Title Segment’s increase reflects stable residential and commercial orders closed and a higher average fee per file.  F&G Segment adjusted net earnings include alternative investment returns below our long-term expectations of $44 million and significant income items of $5 million. Please see “Segment Financial Results” for F&G under “Non-GAAP Measures and Other Information” for further explanation.

    Company Highlights

    • Title Segment revenue and margin uplift despite difficult market conditions: For the Title Segment, total revenue of $1.7 billion for the quarter, a 7% increase over $1.6 billion in the first quarter of 2023. Total revenue, excluding recognized gains and losses, of $1.6 billion for the first quarter, a 5% increase over $1.5 billion in the first quarter of 2023. Adjusted pre-tax title margin was 10.7% for the quarter, compared to 10.0% in the first quarter of 2023
    • F&G Segment sustainable sales growth across multi-channel platform and record assets under management: For the F&G Segment, gross sales of $3.5 billion for the first quarter, a 6% increase over the first quarter of 2023. F&G achieved record assets under management (AUM) of $49.8 billion as of March 31, 2024, driven by new business flows, stable inforce retention and net debt and equity proceeds over the past twelve months
    • Sustainable common dividend backed by strong balance sheet: FNF paid common dividends of $0.48 per share for $130 million and ended the first quarter with $618 million in cash and short-term liquid investments at the holding company

    William P. Foley, II, Chairman, commented, “Our Title segment continues to navigate a challenging housing market having delivered an industry leading adjusted pre-tax title margin of 10.7% for the first quarter.  While higher interest rates are impacting residential purchase volumes, F&G’s business has performed well, regardless of the rate environment, having achieved record assets under management before flow reinsurance of $58.0 billion in the first quarter and providing an important counterbalance for our Title business.  Together, our businesses delivered a 36% increase in adjusted net earnings over the prior year quarter.  Looking forward, we will prudently manage the Company and maintain a balanced capital allocation strategy focused on growing our business through attractive acquisitions while maintaining a steady return of capital to our shareholders through our quarterly dividend as we await the eventual turn in residential purchase volumes.”

    Summary Financial Results

    (In millions, except per share data)

    Three Months Ended

     

    March 31, 2024

     

    March 31, 2023

    Total revenue

    $               3,299

     

    $               2,474

    F&G total gross sales1

    $               3,495

     

    $               3,281

    F&G assets under management1

    $             49,787

     

    $             45,311

    Total assets

    $             84,496

     

    $             69,654

    Adjusted pre-tax title margin

    10.7 %

     

    10.0 %

    Net earnings attributable to common shareholders

    $                  248

     

    $                   (59)

    Net earnings per share attributable to common shareholders

    $                 0.91

     

    $                (0.22)

    Adjusted net earnings1

    $                  206

     

    $                  151

    Adjusted net earnings per share1

    $                 0.76

     

    $                 0.56

    Weighted average common diluted shares

    272

     

    271

    Total common shares outstanding

    273

     

    272

       

    1

    See definition of non-GAAP measures below

    Segment Financial Results

    Title Segment

    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.

    Mike Nolan, Chief Executive Officer, said, “While the residential housing market has remained under pressure due to higher interest rates and lack of supply, we continue to conservatively manage the business to the trend in open orders as we work to protect our profitability.  This can be seen, once again, in our industry leading margins in the first quarter.  Importantly, we are well positioned for the current environment as well as the longer term.  While the timing of a potential rebound in the housing market is uncertain, we believe there is significant pent up demand given favorable demographics in the U.S. that will be unlocked once mortgage rates begin to moderate.”

    First Quarter 2024 Highlights

    • Total revenue of $1.7 billion, compared with $1.6 billion in the first quarter of 2023
    • Total revenue, excluding recognized gains and losses, of $1.6 billion, a 5% increase over first quarter of 2023
      • Direct title premiums of $440 million, a 3% increase over first quarter of 2023
      • Agency title premiums of $593 million, an 8% increase over first quarter of 2023
      • Commercial revenue of $238 million, a 1% decrease from first quarter of 2023
    • Purchase orders opened increased 5% on a daily basis and purchase orders closed increased 1% on a daily basis from the first quarter of 2023
    • Refinance orders opened decreased 2% on a daily basis and refinance orders closed decreased 4% on a daily basis from first quarter of 2023
    • Commercial orders opened were in line with first quarter of 2023 and commercial orders closed decreased 2% from first quarter of 2023
    • Total fee per file of $3,555 for the first quarter, a 3% increase over the first quarter of 2023

    First Quarter 2024 Financial Results

    • Pre-tax title margin of 13.1% and industry leading adjusted pre-tax title margin of 10.7% for the first quarter of 2024, compared to 10.1% and 10.0%, respectively, in the first quarter of 2023.
    • Pre-tax earnings from continuing operations in Title for the first quarter of $218 million, compared with $157 million for the first quarter of 2023
    • Adjusted pre-tax earnings in Title for the first quarter of $171 million compared with $153 million for the first quarter of 2023. The increase reflects stable residential and commercial orders closed and a higher average fee per file

    F&G Segment

    This segment consists of operations of FNF’s majority-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.

    Chris Blunt, President and Chief Executive Officer, commented, “We delivered gross sales of $3.5 billion in the first quarter, an increase of 6% from the year ago first quarter, driven by strength in Retail and Institutional market sales.  We also launched our RILA product in the first quarter and believe it can be a meaningful contributor over time as we tap into a relatively younger demographic.  Looking to the balance of the year, we remain confident in achieving our double digit sales growth guidance for 2024 combined with delivering continued margin expansion from the many strategic initiatives that we have in place.  Underpinning our results and outlook is the credit quality of our portfolio which has remained strong through the quarter.”

    First Quarter 2024

    • Profitable gross sales: Gross sales of $3.5 billion for the first quarter, an increase of 6% from $3.3 billion in the first quarter of 2023, driven by strong retail channel sales and robust institutional market sales
    • Strong Retail channel sales of $2.8 billion for the first quarter, in line with the first quarter of 2023; reflects record indexed annuity sales offset by lower multiyear guaranteed annuity sales, leading to a higher percentage of net sales retained as compared to the prior year quarter
    • Robust Institutional market sales of $0.7 billion, compared to $0.5 billion in the first quarter of 2023, driven by higher pension risk transfer sales
    • Net sales of $2.3 billion for the first quarter, compared to $2.2 billion in the first quarter of 2023
    • Record assets under management (AUM) of $49.8 billion as of March 31, 2024, an increase of 10% from $45.3 billion as of March 31, 2023, driven by net new business flows, stable inforce retention and net debt and equity proceeds over the past twelve months. AUM before flow reinsurance was $58.0 billion as of March 31, 2024
    • Net earnings attributable to common shareholders for F&G Segment of $98 million for the first quarter due to unfavorable mark-to-market movement, compared to a net loss of $164 million for the first quarter of 2023 which included unfavorable mark-to-market movement
    • Adjusted net earnings attributable to common shareholders for F&G Segment of $95 million for the first quarter, compared to $52 million for the first quarter of 2023.
      • F&G’s adjusted net earnings reflect alternatives investment portfolio short-term mark-to-market movement that differs from long-term return expectation. The first quarter of 2024 includes short term investment income from alternative investments and $5 million of significant income items, whereas the first quarter of 2023 included short term investment income from alternative investments and $31 million of significant expense items
      • As compared to the prior year quarter, adjusted net earnings reflect asset growth and diversification of margin from accretive flow reinsurance fees and owned distribution margin, partially offset by an increase in interest expense due to planned capital market activity and higher operating costs in line with the growth in sales and assets and continued investments in our operating platform
      • Please see “Segment Financial Results” for F&G under “Non-GAAP Measures and Other Information” for further explanation

    Conference Call

    We will host a call with investors and analysts to discuss FNF’s first quarter 2024 results on Thursday, May 9, 2024, 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 3:00 p.m. Eastern Time on May 9, 2024, through May 16, 2024, by dialing 1-844-512-2921 (USA) or 1-412-317-6671 (International). The access code will be 13745523.

    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), 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: changes in general economic, business, political crisis, war and pandemic conditions, including ongoing geopolitical conflicts; 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, including regulation of title insurance and services and privacy and data protection laws; systems damage, failures, interruptions, cyberattacks and intrusions, or unauthorized data disclosures; 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.

    FNF-E

    FIDELITY NATIONAL FINANCIAL, INC.

    FIRST QUARTER SEGMENT INFORMATION

    (In millions, except per share data)

    (Unaudited)

     
       

    Consolidated

     

    Title

     

    F&G

     

    Corporate and

    Other

     

    Eliminations

    Three Months Ended

             

    March 31, 2024

             

    Direct title premiums

     

    $            440

     

    $            440

     

    $             —

     

    $                  —

     

    $                  —

    Agency title premiums

     

    593

     

    593

     

     

     

    Escrow, title related and other fees

     

    1,281

     

    484

     

    741

     

    56

     

    Total title and escrow

     

    2,314

     

    1,517

     

    741

     

    56

     

                         

    Interest and investment income

     

    710

     

    83

     

    616

     

    38

     

    (27)

    Recognized gains and losses, net

     

    275

     

    63

     

    212

     

     

    Total revenue

     

    3,299

     

    1,663

     

    1,569

     

    94

     

    (27)

                         

    Personnel costs

     

    727

     

    618

     

    66

     

    43

     

    Agent commissions

     

    460

     

    460

     

     

     

    Other operating expenses

     

    369

     

    285

     

    58

     

    26

     

    Benefits & other policy reserve changes

     

    1,161

     

     

    1,161

     

     

    Market risk benefit (gains) losses

     

    (11)

     

     

    (11)

     

     

    Depreciation and amortization

     

    167

     

    36

     

    123

     

    8

     

    Provision for title claim losses

     

    46

     

    46

     

     

     

    Interest expense

     

    49

     

     

    30

     

    19

     

    Total expenses

     

    2,968

     

    1,445

     

    1,427

     

    96

     

                         

    Pre-tax earnings (loss)

     

    $            331

     

    $            218

     

    $           142

     

    $                   (2)

     

    $                (27)

                         

      Income tax expense (benefit)

     

    63

     

    45

     

    26

     

    (8)

     

      Earnings (loss) from equity investments

     

    1

     

    1

     

     

     

      Non-controlling interests

     

    21

     

    2

     

    18

     

    1

     

                         

    Net earnings (loss) attributable to common shareholders

     

    $            248

     

    $            172

     

    $             98

     

    $                    5

     

    $                (27)

                         

    EPS attributable to common shareholders – basic

     

    $          0.92

                   
                         

    EPS attributable to common shareholders – diluted

     

    $          0.91

                   
                         

    Weighted average shares – basic

     

    271

                   

    Weighted average shares – diluted

     

    272

                   

    FIDELITY NATIONAL FINANCIAL, INC.

    FIRST QUARTER SEGMENT INFORMATION

    (In millions, except per share data)

    (Unaudited)

     
       

    Consolidated

     

    Title

     

    F&G

     

    Corporate and

    Other

     

    Eliminations

    Three Months Ended

             

    March 31, 2024

             

    Net earnings (loss) attributable to common shareholders

     

    $                248

     

    $                172

     

    $             98

     

    $                    5

     

    $                (27)

                         

    Pre-tax earnings (loss) from continuing operations

     

    $                331

     

    $                218

     

    $           142

     

    $                   (2)

     

    $                (27)

                         

     Non-GAAP Adjustments

                       

      Recognized (gains) and losses, net

     

    (31)

     

    (63)

     

    32

     

     

      Market related liability adjustments

     

    (55)

     

     

    (55)

     

     

      Purchase price amortization

     

    41

     

    16

     

    22

     

    3

     

      Transaction costs

     

    1

     

     

     

    1

     

                         

    Adjusted pre-tax earnings (loss)

     

    $                287

     

    $                171

     

    $           141

     

    $                    2

     

    $                (27)

                         

    Total non-GAAP, pre-tax adjustments

     

    $                (44)

     

    $                (47)

     

    $              (1)

     

    $                    4

     

    $                  —

      Income taxes on non-GAAP adjustments

     

    11

     

    11

     

    1

     

    (1)

     

      Non-controlling interest on non-GAAP adjustments

     

    (3)

     

     

    (3)

     

     

      Deferred tax asset valuation allowance

     

    (6)

     

    (6)

     

     

     

    Total non-GAAP adjustments

     

    $                (42)

     

    $                (42)

     

    $              (3)

     

    $                    3

     

    $                  —

                         

    Adjusted net earnings (loss) attributable to common shareholders

     

    $                206

     

    $                130

     

    $             95

     

    $                    8

     

    $                (27)

                         

    Adjusted EPS attributable to common shareholders – diluted

     

    $               0.76

                   

    FIDELITY NATIONAL FINANCIAL, INC.

    FIRST QUARTER SEGMENT INFORMATION

    (In millions, except per share data)

    (Unaudited)

     
       

    Consolidated

     

    Title

     

    F&G

     

    Corporate

    and Other

    Three Months Ended

           

    March 31, 2023

           

    Direct title premiums

     

    $            428

     

    $            428

     

    $             —

     

    $                  —

    Agency title premiums

     

    550

     

    550

     

     

    Escrow, title related and other fees

     

    880

     

    471

     

    365

     

    44

    Total title and escrow

     

    1,858

     

    1,449

     

    365

     

    44

                     

    Interest and investment income

     

    611

     

    81

     

    519

     

    11

    Recognized gains and losses, net

     

    5

     

    22

     

    (15)

     

    (2)

    Total revenue

     

    2,474

     

    1,552

     

    869

     

    53

                     

    Personnel costs

     

    677

     

    598

     

    53

     

    26

    Agent commissions

     

    420

     

    420

     

     

    Other operating expenses

     

    360

     

    296

     

    36

     

    28

    Benefits & other policy reserve changes

     

    812

     

     

    812

     

    Market risk benefit (gains) losses

     

    59

     

     

    59

     

    Depreciation and amortization

     

    134

     

    37

     

    90

     

    7

    Provision for title claim losses

     

    44

     

    44

     

     

    Interest expense

     

    42

     

     

    22

     

    20

    Total expenses

     

    2,548

     

    1,395

     

    1,072

     

    81

                     

    Pre-tax earnings (loss)

     

    $            (74)

     

    $            157

     

    $         (203)

     

    $                (28)

                     

      Income tax expense (benefit)

     

    14

     

    27

     

    (8)

     

    (5)

      Earnings from equity investments

     

     

     

     

      Non-controlling interests

     

    (29)

     

    2

     

    (31)

     

                     

    Net earnings (loss) attributable to common shareholders

     

    $            (59)

     

    $            128

     

    $         (164)

     

    $                (23)

                     

    EPS attributable to common shareholders – basic

     

    $         (0.22)

               
                     

    EPS attributable to common shareholders – diluted

     

    $         (0.22)

               
                     

    Weighted average shares – basic

     

    270

               

    Weighted average shares – diluted

     

    271

               

    FIDELITY NATIONAL FINANCIAL, INC.

    FIRST QUARTER SEGMENT INFORMATION

    (In millions, except per share data)

    (Unaudited)

       

    Consolidated

     

    Title

     

    F&G

     

    Corporate

    and Other

    Three Months Ended

           

    March 31, 2023

           

    Net earnings (loss) attributable to common shareholders

     

    $                (59)

     

    $                128

     

    $              (164)

     

    $                (23)

                     

    Pre-tax earnings (loss) from continuing operations

     

    $                (74)

     

    $                157

     

    $              (203)

     

    $                (28)

                     

    Non-GAAP Adjustments

                   

      Recognized (gains) and losses, net

     

    54

     

    (22)

     

    74

     

    2

      Market related liability adjustments

     

    244

     

     

    244

     

      Purchase price amortization

     

    27

     

    18

     

    5

     

    4

      Transaction costs

     

    5

     

     

    2

     

    3

                     

    Adjusted pre-tax earnings (loss)

     

    $                256

     

    $                153

     

    $                122

     

    $                (19)

                     

    Total non-GAAP, pre-tax adjustments

     

    $                330

     

    $                   (4)

     

    $                325

     

    $                    9

      Income taxes on non-GAAP adjustments

     

    (70)

     

    1

     

    (69)

     

    (2)

      Non-controlling interest on non-GAAP adjustments

     

    (40)

     

     

    (40)

     

      Deferred tax asset valuation allowance

     

    (10)

     

    (10)

     

     

    Total non-GAAP adjustments

     

    $                210

     

    $                (13)

     

    $                216

     

    $                    7

                     

    Adjusted net earnings (loss) attributable to common shareholders

     

    $                151

     

    $                115

     

    $                  52

     

    $                (16)

                     

    Adjusted EPS attributable to common shareholders – diluted

     

    $               0.56

               

    FIDELITY NATIONAL FINANCIAL, INC.

    SUMMARY BALANCE SHEET INFORMATION

    (In millions)

     
       

    March 31,

    2024

     

    December 31,

    2023

       

    (Unaudited)

     

    (Unaudited)

    Cash and investment portfolio

       

    $         60,895

       

    $         58,816

    Goodwill

       

    5,107

       

    4,830

    Title plant

       

    420

       

    418

    Total assets

       

    84,496

       

    80,614

    Notes payable

       

    3,884

       

    3,887

    Reserve for title claim losses

       

    1,746

       

    1,770

    Secured trust deposits

       

    693

       

    731

    Accumulated other comprehensive (loss) earnings

       

    (2,029)

       

    (2,119)

    Non-controlling interests

       

    712

       

    552

    Total equity and non-controlling interests

       

    7,837

       

    7,460

    Total equity attributable to common shareholders

       

    7,125

       

    6,908

    Non-GAAP Measures and Other Information

    Title Segment

    The table below reconciles pre-tax title earnings to adjusted pre-tax title earnings.

     

    Three Months Ended

    (Dollars in millions)

    March 31, 2024

    March 31, 2023

    Pre-tax earnings

    $                   218

    $                    157

    Non-GAAP adjustments before taxes

       

      Recognized (gains) and losses, net

    (63)

    (22)

      Purchase price amortization

    16

    18

    Total non-GAAP adjustments

    (47)

    (4)

    Adjusted pre-tax earnings

    $                   171

    $                    153

    Adjusted pre-tax margin

    10.7 %

    10.0 %

    FIDELITY NATIONAL FINANCIAL, INC.

    QUARTERLY OPERATING STATISTICS

    (Unaudited)

     
       

    Q1 2024

     

    Q4 2023

     

    Q3 2023

     

    Q2 2023

     

    Q1 2023

     

    Q4 2022

     

    Q3 2022

     

    Q2 2022

    Quarterly Opened Orders (‘000’s except % data)

    Total opened orders*

     

    315

     

    257

     

    318

     

    347

     

    308

     

    266

     

    363

     

    443

    Total opened orders per day*

     

    5.1

     

    4.1

     

    5.0

     

    5.4

     

    5.0

     

    4.3

     

    5.7

     

    6.9

    Purchase % of opened orders

     

    79 %

     

    78 %

     

    80 %

     

    79 %

     

    78 %

     

    76 %

     

    76 %

     

    75 %

    Refinance % of opened orders

     

    21 %

     

    22 %

     

    20 %

     

    21 %

     

    22 %

     

    24 %

     

    24 %

     

    25 %

    Total closed orders*

     

    186

     

    192

     

    224

     

    233

     

    188

     

    216

     

    278

     

    348

    Total closed orders per day*

     

    3.0

     

    3.1

     

    3.6

     

    3.6

     

    3.0

     

    3.5

     

    4.3

     

    5.4

    Purchase % of closed orders

     

    79 %

     

    80 %

     

    80 %

     

    81 %

     

    78 %

     

    76 %

     

    76 %

     

    71 %

    Refinance % of closed orders

     

    21 %

     

    20 %

     

    20 %

     

    19 %

     

    22 %

     

    24 %

     

    24 %

     

    29 %

                                     

    Commercial (millions, except orders in ‘000’s)

    Total commercial revenue

     

    $      238

     

    $      294

     

    $      263

     

    $      263

     

    $      241

     

    $      344

     

    $      381

     

    $      436

    Total commercial opened orders

     

    48.7

     

    43.7

     

    49.1

     

    50.2

     

    48.5

     

    44.9

     

    54.8

     

    64.2

    Total commercial closed orders

     

    24.3

     

    26.3

     

    25.6

     

    27.7

     

    24.7

     

    30.5

     

    35.2

     

    39.7

                                     

    National commercial revenue

     

    $      123

     

    $      164

     

    $      131

     

    $      132

     

    $      123

     

    $      177

     

    $      195

     

    $      226

    National commercial opened orders

     

    19.4

     

    18.2

     

    19.2

     

    19.5

     

    18.8

     

    17.8

     

    22.1

     

    26.7

    National commercial closed orders

     

    9.2

     

    10.1

     

    9.4

     

    10.1

     

    8.7

     

    11.9

     

    14.0

     

    15.3

                                     

    Total Fee Per File

    Fee per file

     

    $   3,555

     

    $   3,806

     

    $   3,618

     

    $   3,598

     

    $   3,446

     

    $   3,649

     

    $   3,621

     

    $   3,557

    Residential fee per file

     

    $   2,746

     

    $   2,889

     

    $   2,861

     

    $   2,897

     

    $   2,601

     

    $   2,542

     

    $   2,697

     

    $   2,695

    Total commercial fee per file

     

    $   9,800

     

    $  11,200

     

    $  10,300

     

    $   9,500

     

    $   9,800

     

    $  11,300

     

    $  10,800

     

    $  11,000

    National commercial fee per file

     

    $ 13,400

     

    $  16,300

     

    $  14,000

     

    $  13,000

     

    $ 14,100

     

    $  14,900

     

    $  13,900

     

    $  14,800

                                     

    Total Staffing

    Total field operations employees

     

    10,000

     

    9,900

     

    10,400

     

    10,600

     

    10,400

     

    10,700

     

    12,000

     

    12,700

                                     

    Actual title claims paid ($ millions)

     

    $       70

     

    $        64

     

    $        69

     

    $        67

     

    $       62

     

    $        79

     

    $        65

     

    $        55

    FIDELITY NATIONAL FINANCIAL, INC.

    MONTHLY TITLE ORDER STATISTICS

     
         

    Direct Orders Opened *

       

    Direct Orders Closed *

    Month

     

     / (% Purchase)

     

     / (% Purchase)

    January  2024

       

    102,000

    79 %

       

    56,000

    78 %

    February 2024

       

    102,000

    79 %

       

    61,000

    79 %

    March 2024

       

    111,000

    80 %

       

    69,000

    80 %

                 

    First Quarter 2024

       

    315,000

    79 %

       

    186,000

    79 %

     
         

    Direct Orders Opened *

       

    Direct Orders Closed *

    Month

     

     / (% Purchase)

       

     / (% Purchase)

    January 2023

       

    94,000

    78 %

       

    54,000

    76 %

    February 2023

       

    97,000

    78 %

       

    57,000

    79 %

    March 2023

       

    117,000

    79 %

       

    77,000

    79 %

                 

    First Quarter 2023

       

    308,000

    78 %

       

    188,000

    78 %

    * Includes an immaterial number of non-purchase and non-refinance orders

    F&G Segment

    The table below reconciles net earnings (loss) attributable to common shareholders to adjusted net earnings attributable to common shareholders.  The F&G Segment is reported net of noncontrolling minority interest.

     

    Three Months Ended

    (Dollars in millions)

    March 31, 2024

     

    March 31, 2023

    Net earnings attributable to common shareholders

    $                   98

     

    $               (164)

    Non-GAAP adjustments(1):

         

    Recognized (gains) losses, net

    32

     

    74

    Market related liability adjustments

    (55)

     

    244

    Purchase price amortization

    22

     

    5

    Transaction costs

     

    2

    Income taxes on non-GAAP adjustments

    1

     

    (69)

    Non-controlling interest on non-GAAP adjustments

    (3)

     

    (40)

    Adjusted net earnings (loss) attributable to common shareholders(1)

    $                   95

     

    $                   52

    • Adjusted net earnings of $95 million for the first quarter of 2024 include $84 million, or $0.31 per share, of investment income from alternative investments and $5 million, or $0.02 per share, of CLO redemption gains and bond prepay income. Alternative investments investment income based on management’s long-term expected return of approximately 10% was $128 million, or $0.47 per share.


    • Adjusted net earnings of $52 million for the first quarter of 2023 included $83 million, or $0.31 per share, of investment income from alternative investments, offset by $31 million, or $0.11 per share, tax valuation allowance. Alternative investments investment income based on management’s long-term expected return of approximately 10% was $111 million, or $0.41 per share.

    The table below provides a summary of sales highlights.

       

    Three Months Ended

    (In millions)

     

    March 31, 2024

     

    March 31, 2023

    Total annuity sales

     

    $              2,764

     

    $             2,724

    Indexed universal life sales

     

    42

     

    37

    Funding agreements (FABN/FHLB)

     

    105

     

    256

    Pension risk transfer

     

    584

     

    264

    Gross sales(1)

     

    $              3,495

     

    $             3,281

    Sales attributable to flow reinsurance to third parties

     

    (1,193)

     

    (1,072)

    Net Sales(1)

     

    $              2,302

     

    $             2,209

     

    Footnotes:

    1.

    Non-GAAP financial measure. See the Non-GAAP Measures section below for additional information.

    DEFINITIONS  

    The following represents the definitions of non-GAAP measures used by the Company.

    Adjusted Net Earnings attributable to common shareholders

    Adjusted net earnings attributable to common shareholders is a non-GAAP economic measure we use to evaluate financial performance each period. Adjusted net earnings attributable to common shareholders is calculated by adjusting net earnings (loss) attributable to common shareholders to eliminate:

    i. 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; and the effects of changes in fair value of the reinsurance related embedded derivative and other derivatives, including interest rate swaps and forwards;

    ii. Market related liability adjustments: 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; the impact of initial pension risk transfer deferred profit liability losses, including amortization from previously deferred pension risk transfer deferred profit liability losses; and the changes in the fair value of market risk benefits by deferring current period changes and amortizing that amount over the life of the market risk benefit;

    iii. Purchase price amortization: the impacts related to the amortization of certain intangibles (internally developed software, trademarks and value of distribution asset and the change in fair value of liabilities recognized as a result of acquisition activities);

    iv. Transaction costs: the impacts related to acquisition, integration and merger related items;

    v. Certain income tax adjustments: the impacts related to unusual tax items that do not reflect our core operating performance such as the establishment or reversal of significant deferred tax asset valuation allowances in our Title and Corporate and Other segments;

    vi. 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;

    vii. Non-controlling interest on non-GAAP adjustments: the portion of the non-GAAP adjustments attributable to the equity interest of entities that FNF does not wholly own; and

    viii. Income taxes: the income tax impact related to the above-mentioned 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.

    Assets Under Management (AUM)

    AUM is comprised of the following components and is reported net of reinsurance assets ceded in accordance with GAAP:

    i. total invested assets at amortized cost, excluding investments in unconsolidated affiliates, owned distribution and derivatives;

    ii. investments in unconsolidated affiliates at carrying value;

    iii. related party loans and investments;

    iv. accrued investment income;

    v. the net payable/receivable for the purchase/sale of investments; and

    vi. cash and cash equivalents excluding derivative collateral at the end of the period. 

    Management considers this non-GAAP financial measure to be useful internally and to investors and analysts when assessing the size of our investment portfolio that is retained.

    AUM before Flow Reinsurance

    AUM before Flow Reinsurance is comprised of components consistent with AUM, but also includes flow reinsured assets.

    Management considers this non-GAAP financial measure to be useful internally and to investors and analysts when assessing the size of our investment portfolio including reinsured assets.

    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 retained assets.

    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.

    SOURCE Fidelity National Financial, Inc.

    Originally Posted at PR Newswire on May 8, 2024 by Fidelity National Financial, Inc..

    Categories: Industry Articles
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