Jacksonville, Fla. -- (October 25, 2006) -- Fidelity National Financial, Inc. (NYSE:FNF), a Fortune 500 provider of outsourced products and services to a variety of industries, today reported operating results for the three-month and nine-month periods ended September 30, 2006.
* For purposes of computing earnings per diluted share, FNF has to analyze the dilutive impact of outstanding options at its public subsidiaries, Fidelity National Title Group, Inc. and Fidelity National Information Services, Inc., and, if necessary, adjust the net earnings available to FNF shareholders before calculating earnings per diluted share. For the three-month and nine-month periods ended September 30, 2006, net earnings were reduced by $1.3 million and $2.9 million, respectively, resulting in a reduction of $0.01 and $0.02, respectively, in earnings per diluted share for three-month and nine-month periods ended September 30, 2006.
"This was another successful quarter for FNF," said Chairman and Chief Executive Officer William P. Foley, II. "The third quarter was one of transition for our title insurance business. The mix of business clearly shifted from a majority of purchase transactions toward more refinance transactions, which generate about half of the revenue of a purchase transaction. In the title business, we were focused on reducing headcount and eliminated approximately 650 positions during the quarter, which helped in reducing title related personnel costs by $75 million versus the prior year quarter. FIS had a very strong quarter, as they generated 10.2% revenue growth and grew EBITDA by more than 10%. Organic revenue growth has accelerated significantly since the FIS/Certegy merger through the improvement of the sales organization, cross selling existing customers, developing new products and services that leverage the core processing capability and putting the best resources behind new large targeted customer opportunities. Specialty insurance continues to provide growing and more recurring revenue and earnings streams that are not necessarily tied to mortgage originations and through both organic growth and two recent acquisitions, Sedgwick has become a more than $600 million revenue base company with greater than 15% EBITDA margins."
The merger of FNF with and into FIS is scheduled to close on November 9, 2006. FNF shareholders will receive approximately 0.537228 shares of FIS common stock for each share of FNF stock. Upon the closing of the merger of FNF with and into FIS, Fidelity National Title Group, Inc. (NYSE:FNT) will legally change its name to Fidelity National Financial, Inc. and its common stock will trade on the New York Stock Exchange under the trading symbol 'FNF' beginning on November 10, 2006. The following are summary financial results for the operating subsidiaries of FNF for the three-month and nine-month periods ending September 30, 2006 and 2005:
FNF presents its financial results in accordance with Generally Accepted Accounting Principles ("GAAP"). However, in order to provide the investment community with a more thorough means of evaluating the operating performance of its operations, FNF also reports several non-GAAP measures, including earnings before interest, taxes, depreciation and amortization ("EBITDA"), net earnings plus depreciation and amortization less capital expenditures ("Free Cash Flow") and net earnings plus other intangible amortization, net of income tax ("Cash Earnings"). 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.
Fidelity National Financial, Inc. (NYSE:FNF), is a provider of outsourced products and services to a variety of industries. Through its majority-owned, publicly traded subsidiary, Fidelity National Information Services, Inc. (NYSE:FIS), FNF provides an industry leading suite of data processing, payment and risk management services to financial institutions and retailers. www.fnf.com.
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; our dependence on operating subsidiaries as a source of cash flow; significant competition that our operating subsidiaries face; the possibility that the announced merger of FNF with and into FIS will not be completed, will be completed in a different form or with different effects on stockholders than described or will not be successful in achieving the goals targeted; 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.
SOURCE: Fidelity National Financial, Inc.
CONTACT: Daniel Kennedy Murphy, Senior Vice President, Finance and Investor Relations, 904-854-8120, email@example.com
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