Strong Operating Performance Highlighted by Revenue Growth and Favorable Mix, Significant Margin Expansion and Capital Return
CoreLogic (NYSE: CLGX), a leading global provider of property information, insight, analytics and data-enabled solutions, today announced that it expects to modestly exceed its previously-issued financial guidance for the fourth quarter, and full-year of 2019 as summarized below:
- Full-year financial results expected to modestly exceed the top end of previously-issued revenue, adjusted EBITDA and adjusted EPS guidance ranges boosted by a strong fourth quarter 2019 performance.
|$ in Millions, except per-share|
|Top End of 2019 Guidance|
(Issued October 23, 2019)
(1) Definition of adjusted results, as well as other non-GAAP financial measures used by management, is included in the Use of Non-GAAP Financial Measures section found at the end of the release.
- The expected outperformance of revenue compared with previously-issued financial guidance was driven primarily by improved market volumes and favorable product mix.
- The expected outperformance of adjusted EBITDA compared with previously issued guidance ranges was primarily driven by revenue growth and favorable product mix and the benefits of cost efficiency and productivity.
- Adjusted EBITDA margins are expected to exceed 30% for the entirety of the second half of 2019 including a year-over-year expansion of approximately 500 basis points in the fourth quarter.
- Free cash flow (“FCF”) for the twelve months ended December 31, 2019 is expected to exceed 50% of adjusted EBITDA. During 2019, the Company repurchased approximately 3% of its outstanding common shares for approximately $87 million and reduced debt outstanding by $111 million.
“CoreLogic delivered outstanding revenue growth and margins in the second half and fourth quarter, driven by acceleration in our core mortgage, platform-related and other high-margin businesses. We also capitalized on higher market volumes in the US. Ongoing productivity gains helped us to drive adjusted EBITDA margins to record levels, exceeding 30% in the fourth quarter, an improvement of approximately 500 basis points from 2018″, said Frank Martell, President and Chief Executive Officer of CoreLogic. “As we exit 2019, in-flight strategic investments and ongoing cost efficiency and productivity initiatives provide us with a solid line of sight to our adjusted EBITDA margin objective of 30% as we deploy our unique data, analytics and data-enabled solutions that, collectively, help millions of people find, buy and protect the homes they love.”
The following additional important fourth quarter business highlights are included for reference:
- In November 2019, the Company announced the completion of the transformation of its AMC operations which was commenced in December 2018. The successful launch of an enhanced AMC business model is expected to significantly reduce appraiser turn times as well as improve quality and productivity. Based on a strong pipeline of secured business and pending contract signings, CoreLogic’s AMC is expected to generate strong growth and higher profit margins in 2020.
- In December 2020, the Company announced the initiation of a quarterly dividend to shareholders and announced it will pay a cash dividend of $0.22 per share of common stock on January 24, 2020 to shareholders of record on the close of business January 10, 2020. The decision to initiate a dividend is consistent with the Company’s long-held commitment to recognize and reward long-term shareholders through a robust capital return program that includes dividend payments and the repurchase of its common shares on an opportunistic basis.
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, acquire, and protect their homes. For more information, please visit stage.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 the acceleration of the transformation of the Company’s appraisal management services and the intent to exit certain legacy non-core business platforms, including the expected financial impact of these strategic and operating actions. 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. These risks and uncertainties include but are not limited to: our ability to protect our information systems against data corruption, cyber-based attacks or network security breaches; limitations on access to or increase in prices for data from external sources, including government and public record sources; changes in applicable government legislation, regulations and the level of regulatory scrutiny affecting our customers or us, including with respect to consumer financial services and the use of public records and consumer data; systems interruptions that may impair the delivery of our products and services; difficult conditions in the mortgage and consumer lending industries and the economy generally; risks related to the outsourcing of services and international operations; our ability to realize the anticipated benefits of certain acquisitions and/or divestitures and the timing thereof; and impairments in our goodwill or other intangible assets. The forward-looking statements speak only as of the date they are made. The Company 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, such as 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 the 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 to the most directly comparable GAAP financial measures is included in this press release.
The Company believes that its presentation of these non-GAAP measures provides useful supplemental information to investors and management regarding the Company’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 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 25% for 2019. 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.
This press release also contains certain forward-looking non-GAAP financial measures, such as adjusted EBITDA and adjusted EPS, which are provided only as supplemental information. The Company is not able to provide a reconciliation, without unreasonable efforts, of its forward-looking guidance of adjusted EBITDA and adjusted EPS 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.
Executive, Investor Relations