Delaware | 001-13585 | 95-1068610 | ||
(State or Other Jurisdiction of Incorporation) | (Commission File Number) | (IRS Employer Identification No.) |
40 Pacifica, Irvine, California | 92618-7471 | |
(Address of Principal Executive Offices) | (Zip Code) |
o | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
o | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
o | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
o | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
(d) | Exhibits. |
Exhibit Number | Description | |
Press release dated April 24, 2019 |
CoreLogic, Inc. | |||
(Registrant) | |||
Date: | April 24, 2019 | By: | /s/ James L. Balas |
Name: | James L. Balas | ||
Title: | Chief Financial Officer | ||
(Principal Financial Officer) |
• | Revenues of $418 million, down 6% primarily reflecting the impacts of an estimated 10% to 15% drop in U.S. mortgage volumes and lower revenues attributable to appraisal management company (AMC) operations and non-core mortgage and default technology related platforms. |
• | Operating and net income from continuing operations were $21 million and $2 million, 52% and 94% below prior year levels, driven by the impacts of lower revenues and higher costs related to productivity programs and efficiency actions. |
• | Diluted EPS from continuing operations of $0.02, compared to $0.34. Adjusted EPS totaled $0.45, down 14%. |
• | Adjusted EBITDA of $98 million, down 5%. Adjusted EBITDA margins were up approximately 20 basis points. |
• | The Company made $23 million in voluntary principal payments against its outstanding term loan obligations. |
For the Three Months Ended | |||||||
March 31, | |||||||
(in thousands, except per share amounts) | 2019 | 2018 | |||||
Operating revenues | $ | 417,708 | $ | 444,900 | |||
Cost of services (excluding depreciation and amortization shown below) | 219,061 | 239,389 | |||||
Selling, general and administrative expenses | 128,224 | 114,952 | |||||
Depreciation and amortization | 49,219 | 46,140 | |||||
Total operating expenses | 396,504 | 400,481 | |||||
Operating income | 21,204 | 44,419 | |||||
Interest expense: | |||||||
Interest income | 978 | 530 | |||||
Interest expense | 19,703 | 17,692 | |||||
Total interest expense, net | (18,725 | ) | (17,162 | ) | |||
Gain on investments and other, net | 734 | 161 | |||||
Income from continuing operations before equity in (losses)/earnings of affiliates and income taxes | 3,213 | 27,418 | |||||
Provision/(benefit) for income taxes | 1,058 | (711 | ) | ||||
Income from continuing operations before equity in (losses)/earnings of affiliates | 2,155 | 28,129 | |||||
Equity in (losses)/earnings of affiliates, net of tax | (422 | ) | 233 | ||||
Net income from continuing operations | 1,733 | 28,362 | |||||
Loss from discontinued operations, net of tax | (46 | ) | (75 | ) | |||
Net income | $ | 1,687 | $ | 28,287 | |||
Basic income per share: | |||||||
Net income from continuing operations | $ | 0.02 | $ | 0.35 | |||
Loss from discontinued operations, net of tax | — | — | |||||
Net income | $ | 0.02 | $ | 0.35 | |||
Diluted income per share: | |||||||
Net income from continuing operations | $ | 0.02 | $ | 0.34 | |||
Loss from discontinued operations, net of tax | — | — | |||||
Net income | $ | 0.02 | $ | 0.34 | |||
Weighted-average common shares outstanding: | |||||||
Basic | 80,179 | 81,254 | |||||
Diluted | 81,277 | 82,820 |
(in thousands, except par value) | March 31, | December 31, | |||||
Assets | 2019 | 2018 | |||||
Current assets: | |||||||
Cash and cash equivalents | $ | 86,828 | $ | 85,271 | |||
Accounts receivable (less allowance for doubtful accounts of $6,302 and $5,742 as of March 31, 2019 and December 31, 2018, respectively) | 246,329 | 242,814 | |||||
Prepaid expenses and other current assets | 49,211 | 50,136 | |||||
Income tax receivable | 13,971 | 25,299 | |||||
Total current assets | 396,339 | 403,520 | |||||
Property and equipment, net | 459,478 | 456,497 | |||||
Operating lease assets | 64,606 | — | |||||
Goodwill, net | 2,395,765 | 2,391,954 | |||||
Other intangible assets, net | 452,124 | 468,405 | |||||
Capitalized data and database costs, net | 324,116 | 324,049 | |||||
Investment in affiliates, net | 21,867 | 22,429 | |||||
Other assets | 99,701 | 102,136 | |||||
Total assets | $ | 4,213,996 | $ | 4,168,990 | |||
Liabilities and Equity | |||||||
Current liabilities: | |||||||
Accounts payable and other accrued expenses | $ | 162,045 | $ | 166,258 | |||
Accrued salaries and benefits | 75,861 | 84,940 | |||||
Contract liabilities, current | 312,322 | 308,959 | |||||
Current portion of long-term debt | 47,465 | 26,935 | |||||
Operating lease liabilities, current | 16,709 | — | |||||
Total current liabilities | 614,402 | 587,092 | |||||
Long-term debt, net of current | 1,709,501 | 1,752,241 | |||||
Contract liabilities, net of current | 520,845 | 524,069 | |||||
Deferred income tax liabilities | 125,064 | 124,968 | |||||
Operating lease liabilities, net of current | 82,851 | — | |||||
Other liabilities | 162,062 | 180,122 | |||||
Total liabilities | $ | 3,214,725 | $ | 3,168,492 | |||
Stockholders' equity: | |||||||
Preferred stock, $0.00001 par value; 500 shares authorized, no shares issued or outstanding | $ | — | $ | — | |||
Common stock, $0.00001 par value; 180,000 shares authorized; 80,633 and 80,092 shares issued and outstanding as of March 31, 2019 and December 31, 2018, respectively | 1 | 1 | |||||
Additional paid-in capital | 164,969 | 160,870 | |||||
Retained earnings | 977,062 | 975,375 | |||||
Accumulated other comprehensive loss | (142,761 | ) | (135,748 | ) | |||
Total stockholders' equity | 999,271 | 1,000,498 | |||||
Total liabilities and equity | $ | 4,213,996 | $ | 4,168,990 |
For the Three Months Ended | |||||||
March 31, | |||||||
(in thousands) | 2019 | 2018 | |||||
Cash flows from operating activities: | |||||||
Net income | $ | 1,687 | $ | 28,287 | |||
Less: Loss from discontinued operations, net of tax | (46 | ) | (75 | ) | |||
Net income from continuing operations | 1,733 | 28,362 | |||||
Adjustments to reconcile net income from continuing operations to net cash provided by operating activities: | |||||||
Depreciation and amortization | 49,219 | 46,140 | |||||
Amortization of debt issuance costs | 1,302 | 1,376 | |||||
Amortization of operating lease assets | 4,036 | — | |||||
Provision for bad debt and claim losses | 3,788 | 2,847 | |||||
Share-based compensation | 9,892 | 8,677 | |||||
Equity in losses/(earnings) of affiliates, net of taxes | 422 | (233 | ) | ||||
Deferred income tax | 4,346 | 6,250 | |||||
Gain on investment and other, net | (734 | ) | (161 | ) | |||
Change in operating assets and liabilities, net of acquisitions: | |||||||
Accounts receivable | (5,489 | ) | 12,745 | ||||
Prepaid expenses and other current assets | (2,778 | ) | (764 | ) | |||
Accounts payable and other accrued expenses | (7,665 | ) | 4,987 | ||||
Contract liabilities | 173 | (2,756 | ) | ||||
Income taxes | 10,966 | (482 | ) | ||||
Dividends received from investments in affiliates | — | 776 | |||||
Other assets and other liabilities | (4,630 | ) | (7,556 | ) | |||
Net cash provided by operating activities - continuing operations | 64,581 | 100,208 | |||||
Net cash provided by operating activities - discontinued operations | — | 2 | |||||
Total cash provided by operating activities | $ | 64,581 | $ | 100,210 | |||
Cash flows from investing activities: | |||||||
Purchases of property and equipment | $ | (24,020 | ) | $ | (9,940 | ) | |
Purchases of capitalized data and other intangible assets | (8,947 | ) | (9,544 | ) | |||
Cash paid for acquisitions, net of cash acquired | — | (20,533 | ) | ||||
Cash received from sale of business-line | 1,082 | — | |||||
Proceeds from sale of property and equipment | — | 100 | |||||
Proceeds from investments | 1,157 | 980 | |||||
Net cash used in investing activities - continuing operations | (30,728 | ) | (38,937 | ) | |||
Net cash provided by investing activities - discontinued operations | — | — | |||||
Total cash used in investing activities | $ | (30,728 | ) | $ | (38,937 | ) | |
Cash flows from financing activities: | |||||||
Proceeds from long-term debt | $ | — | $ | 95 | |||
Repayment of long-term debt | (25,563 | ) | (45,722 | ) | |||
Proceeds from issuance of shares in connection with share-based compensation | 2,758 | 15,473 | |||||
Payment of tax withholdings related to net share settlements | (8,551 | ) | (10,532 | ) | |||
Shares repurchased and retired | — | (18,479 | ) | ||||
Contingent consideration payments subsequent to acquisitions | (600 | ) | — | ||||
Net cash used in financing activities - continuing operations | (31,956 | ) | (59,165 | ) |
Net cash provided by financing activities - discontinued operations | — | — | |||||
Total cash used in financing activities | $ | (31,956 | ) | $ | (59,165 | ) | |
Effect of exchange rate on cash, cash equivalents and restricted cash | (200 | ) | 311 | ||||
Net change in cash, cash equivalents and restricted cash | $ | 1,697 | $ | 2,419 | |||
Cash, cash equivalents and restricted cash at beginning of period | 98,250 | 132,154 | |||||
Less: Change in cash, cash equivalents and restricted cash - discontinued operations | — | 2 | |||||
Plus: Cash swept from discontinued operations | — | 2 | |||||
Cash, cash equivalents and restricted cash at end of period | $ | 99,947 | $ | 134,573 |
For the Three Months Ended March 31, 2019 | |||||||||||||||
(in thousands) | PIRM | UWS | Corporate | Elim | CoreLogic | ||||||||||
Net income/(loss) from continuing operations | $ | 11,387 | $ | 45,435 | $ | (55,089 | ) | $ | — | $ | 1,733 | ||||
Income taxes | — | — | 919 | — | 919 | ||||||||||
Depreciation and amortization | 26,799 | 15,775 | 6,645 | — | 49,219 | ||||||||||
Interest expense, net | 247 | 81 | 18,397 | — | 18,725 | ||||||||||
Share-based compensation | 1,750 | 1,623 | 6,519 | — | 9,892 | ||||||||||
Non-operating losses | 2,275 | — | 269 | — | 2,544 | ||||||||||
Efficiency investments | 1,590 | 463 | 10,989 | — | 13,042 | ||||||||||
Transaction costs | 1,698 | — | (12 | ) | — | 1,686 | |||||||||
Amortization of acquired intangibles included in equity in losses of affiliates | 77 | — | — | — | 77 | ||||||||||
Adjusted EBITDA | $ | 45,823 | $ | 63,377 | $ | (11,363 | ) | $ | — | $ | 97,837 |
For the Three Months Ended March 31, 2018 | |||||||||||||||
(in thousands) | PIRM | UWS | Corporate | Elim | CoreLogic | ||||||||||
Net income/(loss) from continuing operations | $ | 20,671 | $ | 47,754 | $ | (40,063 | ) | $ | — | $ | 28,362 | ||||
Income taxes | — | — | (633 | ) | — | (633 | ) | ||||||||
Depreciation and amortization | 25,735 | 14,964 | 5,441 | — | 46,140 | ||||||||||
Interest expense, net | 279 | 75 | 16,808 | — | 17,162 | ||||||||||
Share-based compensation | 1,086 | 2,340 | 5,251 | — | 8,677 | ||||||||||
Non-operating losses | 500 | — | 446 | — | 946 | ||||||||||
Efficiency investments | — | — | 499 | — | 499 | ||||||||||
Transaction costs | 1,215 | — | 826 | — | 2,041 | ||||||||||
Amortization of acquired intangibles included in equity in earnings of affiliates | 233 | — | — | — | 233 | ||||||||||
Adjusted EBITDA | $ | 49,719 | $ | 65,133 | $ | (11,425 | ) | $ | — | $ | 103,427 |
For the Three Months Ended March 31, | |||||||
(Diluted income per share) | 2019 | 2018 | |||||
Net income from continuing operations | $ | 0.02 | $ | 0.34 | |||
Share-based compensation | 0.12 | 0.10 | |||||
Non-operating losses | 0.03 | 0.01 | |||||
Efficiency investments | 0.16 | 0.01 | |||||
Transaction costs | 0.02 | 0.02 | |||||
Depreciation and amortization of acquired software and intangibles | 0.24 | 0.22 | |||||
Income tax effect on adjustments | (0.14 | ) | (0.18 | ) | |||
Adjusted EPS | $ | 0.45 | $ | 0.52 |
(in thousands) | For the Twelve Months Ended March 31, 2019 | |||
Net cash provided by operating activities - continuing operations | $ | 319,491 | ||
Purchases of property and equipment | (76,384 | ) | ||
Purchases of capitalized data and other intangible assets | (34,478 | ) | ||
Free cash flow | $ | 208,629 |