Fueled by Double-Digit Revenue Growth Driven by Housing Market Activity and Share Gains, Operating Leverage and Cost Productivity
IRVINE, Calif. — (BUSINESS WIRE) — May 7, 2021 — CoreLogic (NYSE: CLGX), a leading global provider of property information, insight, analytics and data-enabled solutions, today reported financial results for the first quarter ended March 31, 2021.
“Capitalizing on momentum from record 2020 performance, CoreLogic delivered strong double-digit revenue and profit growth and expanded profit margins during the first three months of 2021. Free cash flow conversion rates enabled the return of $24 million in capital to our stockholders and paydown of $100 million in debt,” said Frank Martell, President and Chief Executive Officer. “Looking ahead, share gains, pricing and the launch of new innovative solutions in insurance, geospatial and core mortgage should position us well to continue to accelerate our positive operating and financial trends well into the future. CoreLogic is firing on all cylinders and we have started 2021 with strong momentum and believe we are well positioned to capitalize on our many value-creation opportunities over the balance of this year and beyond,” Martell added.
First Quarter Financial(1) and Business Highlights
Growth Focus –Share Gains, Mega Wins and Pricing Drive Sustained, High Organic Growth Rates
- Revenues of $423 million were up 20% over the prior year. PIRM segment growth totaled 8%, benefiting from robust growth in property insights and international. UWS revenues grew 28% on strong market volumes and market outperformance across the segment as a whole.
- Core mortgage market outperformance in UWS and continued strong organic growth in the PIRM segment demonstrate the durable and positive impacts of mega wins and share gains achieved in 2020 and continued momentum into 2021.
Profitability – Operating Leverage, Favorable Mix and Productivity Fuel Expanded Profit and Margins
- Operating income of $85 million, up by $30 million
- Net income from continuing operations of $55 million, up by $31 million
- Diluted EPS from continuing operations of $0.73 and adjusted EPS of $1.20; up 143% and 85%, respectively
- Adjusted EBITDA of $160 million, up 39%
- Adjusted EBITDA margin of 38%, up 530 basis points
Liquidity and Capital Return – Record Cash Flow Generation
- Net operating cash provided by continuing operations for the 12 months ended March 31, 2021 was $574 million. Free cash flow ("FCF") for the 12 months ended March 31, 2021 totaled $475 million or 70% of adjusted EBITDA
- Debt outstanding on March 31, 2021 of $1.79 billion compared with $1.89 billion on December 31, 2020
- $450 million available on revolving credit facility; covenant debt leverage at 2.4 times
- Dividends paid to shareholders totaled $24 million in the first quarter
(1) The Company’s financial results presented in this release reflect continuing operations. Reseller operations held for sale are presented as discontinued operations for all periods presented.
Consistent with our previously announced intentions, the Company has exited its multi-family tenant screening operations and intends to exit its mortgage credit and borrower verification operations. Although market leaders in their respective business areas, these reseller businesses are not compatible with the Company’s long-term strategic imperatives. The divestiture of these operations is expected to improve the Company’s revenue growth trends, revenue mix, and significantly enhance profit margins. These reseller operations have been classified as discontinued operations and prior period results have been presented on a comparable basis.
In October 2020, we consummated the sale of a component of our multi-family tenant screening for $9.0 million of proceeds. In February 2021, we sold the remainder of our multi-family tenant screening business for proceeds of $51.2 million.
CoreLogic (NYSE: CLGX), the leading provider of property insights and solutions, promotes a healthy housing market and thriving communities. Through its enhanced property data solutions, services and technologies, CoreLogic enables real estate professionals, financial institutions, insurance carriers, government agencies and other housing market participants to help millions of people find, buy, and protect their homes. For more information, please visit www.corelogic.com.
Safe Harbor / Forward Looking Statements
Certain statements made in this press release are forward-looking statements within the meaning of the federal securities laws, including but not limited to those statements related to (i) projections and trends regarding financial performance and operating results, including with respect to revenue growth, margin gains, contract wins, pricing optimization, technological innovation, market share gains, new products, and long-term stockholder value, and (ii) our intention to exit our reseller operations. Risks and uncertainties exist that may cause the results to differ materially from those set forth in these forward-looking statements. Factors that could cause the anticipated results to differ from those described in the forward-looking statements include the risks and uncertainties set forth in Part I, Item 1A of our most recent Annual Report on Form 10-K, as such risk factors may be amended, supplemented, or superseded from time to time by other reports we file with the Securities and Exchange Commission. These risks and uncertainties include but are not limited to: our ability to satisfy the remaining conditions to close the acquisition of the Company by Stone Point Capital and Insight Partners (the "Merger") in a timely manner, or at all; the potential impact of, and any potential developments related to, the proposed Merger; the potential impact of, and any potential developments related to, activist shareholder activity; compromises in the security or stability of our data and systems, including from cyber-based attacks, the unauthorized transmission of confidential information or systems interruptions, which could impair the delivery of our products and services; changes in applicable government legislation, regulations and the level of regulatory scrutiny affecting our clients or us, including with respect to consumer financial services and the use of public records and consumer data; reliance on our top ten clients for a significant portion of our revenue and profit; intense competition in the market against third parties and the in-house capabilities of our clients; risks related to the outsourcing of services and international operations; potential impairment of our substantial goodwill and other intangible assets; the potential impact that the COVID-19 pandemic, or the perception of its effects, may have on our business; our ability to protect proprietary technology rights and avoid infringement of others’ proprietary technology rights; the level of our indebtedness, our ability to service our indebtedness and the restrictions in our various debt agreements; our ability to realize the anticipated benefits of certain acquisitions and the timing thereof; the impact of our adoption of a shareholder rights plan; difficult or uncertain conditions in the mortgage and consumer lending industries and the economy generally; and our ability to attract and retain qualified personnel. [delete extra period] The forward-looking statements speak only as of the date they are made. CoreLogic does not undertake to update forward-looking statements to reflect circumstances or events that occur after the date the forward-looking statements are made.
Use of Non-GAAP (Generally Accepted Accounting Principles) Financial Measures
This press release contains certain non-GAAP financial measures, including adjusted EBITDA, adjusted EPS and FCF, which are provided only as supplemental information. Investors should consider these non-GAAP financial measures only in conjunction with their most directly comparable GAAP financial measures. These non-GAAP measures are not in accordance with, or a substitute for, U.S. GAAP. A reconciliation of non-GAAP measures for historical periods to the most directly comparable GAAP financial measures is included in this press release. CoreLogic believes that its presentation of these non-GAAP measures provides useful supplemental information to investors and management regarding CoreLogic's financial condition and results of operations. Adjusted EBITDA is defined as net income from continuing operations adjusted for interest, taxes, depreciation and amortization, share-based compensation, non-operating gains/losses, and other adjustments. Adjusted EPS is defined as diluted net income from continuing operations , net of tax per share, adjusted for share-based compensation, amortization of acquisition-related intangibles, non-operating gains/losses, and other adjustments; and assumes an effective tax rate of 26% for 2021 and 26% for 2020. FCF is defined as net cash provided by continuing operating activities, less capital expenditures for purchases of property and equipment, capitalized data, and other intangible assets. Other firms may calculate non-GAAP measures differently than the Company, which limits comparability between companies. Non-GAAP measures are not in accordance with, or a substitute for, U.S. GAAP. Because the non-GAAP measures for future periods included herein are forward-looking, CoreLogic is not able to provide a reconciliation, without unreasonable efforts, of such forward-looking guidance to the most directly comparable GAAP financial measure due to the unknown effect, timing, and potential significance of special charges or gains that are material to the comparable GAAP financial measure.