CoreLogic Reports Third Quarter 2011 Financial Results
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CoreLogic Reports Third Quarter 2011 Financial Results

(PRNewswire) — CoreLogic (NYSE: CLGX), a leading provider of consumer, financial and property information, analytics and services, today reported financial results for the quarter ended September 30, 2011.

Anand Nallathambi, President and Chief Executive Officer, commented on the quarter, "During the third quarter, we took aggressive actions to sharpen our focus on our core businesses and better position CoreLogic to capitalize on our competitive strengths in the data and analytics and core mortgage origination services areas.  These core businesses benefit from their leading market presence, unique data assets, intellectual property and world-class domain expertise."

Nallathambi continued, "With a more focused set of businesses and an aggressive cost reduction plan, we believe CoreLogic is positioned for stronger financial results in 2012 and beyond with less dependency on improvement in the mortgage market.  Going forward, we believe CoreLogic shareholders will benefit from balanced revenue growth and enhanced margin profiles across our core businesses."

Frank Martell, Chief Financial Officer, commented on the increased cost reduction targets, "We believe the actions taken this quarter, along with our continuing program of aggressive cost reductions and productivity improvements, will allow CoreLogic to reach its goal of 30% adjusted EBITDA margins through 2013.  As a result of accelerated progress on our cost reduction plans and stronger mortgage refinancing activity in the second half of 2011, we are increasing our full-year 2011 guidance to $290 - $300 million in adjusted EBITDA and $0.75 - $0.80 in adjusted EPS."

In the discussion below of the business segments and of CoreLogic as a firm, certain information is presented on an adjusted basis. For more information about the Company's adjusted results, as well as other non-GAAP financial measures used by management, please see the Company's quarterly financial supplement on the CoreLogic investor website and discussion on the Use of Non-GAAP Financial Measures found on page 4 of this release.

Third Quarter Financial Highlights (continuing operations)


Liquidity and Capital Resources


Non-Core Businesses Exited


Cost Reduction Program Expanded


Increased Full Year 2011 Guidance (continuing operations)


Strategic Alternatives Review


Teleconference/Webcast

The CoreLogic management team will host a live webcast and conference call on Thursday, November 3, 2011, at 8:00 a.m. Pacific time (11:00 a.m. Eastern time) to discuss these results. All interested parties are invited to listen to the event via webcast on the CoreLogic website at http://investor.corelogic.com. The discussion is also available through dial-in number 1-866-713-8564 for U.S./Canada participants or 617-597-5312 for international participants using Conference ID 48074633.

A replay of the webcast will be available on the CoreLogic investor website for 30 days and also through the conference call number 1-888-286-8010 for U.S./Canada participants or 617-801-6888 for international participants using Conference ID 45643298.

Additional detail on the Company's third quarter financial results is included in the quarterly financial supplement, available on the Investor Relations page at http://investor.corelogic.com.

About CoreLogic

CoreLogic (NYSE: CLGX) is a leading provider of consumer, financial and property information, analytics and services to business and government. The Company combines public, contributory and proprietary data to develop predictive decision analytics and provide business services that bring dynamic insight and transparency to the markets it serves. CoreLogic has built one of the largest and most comprehensive U.S. real estate, mortgage application, fraud, and loan performance databases and is a recognized leading provider of mortgage and automotive credit reporting, property tax, valuation, flood determination, and geospatial analytics and services. More than one million users rely on CoreLogic to assess risk, support underwriting, investment and marketing decisions, prevent fraud, and improve business performance in their daily operations. The Company, headquartered in Santa Ana, Calif., has more than 5,000 employees globally. For more information 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 the Company's overall financial performance, including future revenue and earnings growth, future margin improvement and future adjusted EBITDA and EPS performance, estimated future cost savings and the impact thereof; mortgage market trends; and anticipated workforce reductions. Risk 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 are set forth in Part I, Item 1A of our most recent Annual Report on Form 10-K for the year ended December 31, 2010, as updated by our Quarterly Reports on Form 10-Q, including but not limited to: limitations on access to 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 which may, among other things, limit the manner in which we conduct business with our customers; compromises in the security of our data transmissions, including the transmission of confidential information or systems interruptions; difficult conditions in the mortgage and consumer credit industry, including the continued decline in mortgage applications, declines in the level of loans seriously delinquent and continued delays in the default cycle, the state of the securitization market, increased unemployment, and conditions in the economy generally; risks related to our international operations and the  outsourcing of various business process and information technology services to third parties, including potential disruptions to services and customers and inability to achieve cost savings; 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 Financial Measures

This press release contains certain financial measures that are not presented in accordance with Generally Accepted Accounting Principles (GAAP), including adjusted revenue which includes equity in earnings of affiliates; adjusted EBITDA, adjusted EBITDA margin and adjusted pretax margin which is adjusted to exclude historical corporate expense of the spun-off businesses, net realized investment gains/losses, employee separation costs, and other adjustments. Although these exclusions represent actual losses or expenses to the Company, they may mask the periodic income and financial and operating trends associated with the Company's business. To compensate for the inherent limitations of these non-GAAP measures, the Company uses them in conjunction with the corresponding GAAP measures.  

The Company is presenting these non-GAAP financial measures because the Company believes that they provide the Company's management and investors with additional insight into the operational performance of the Company relative to earlier periods. The Company does not intend for these non-GAAP financial measures to be a substitute for any GAAP financial information. In this press release, these non-GAAP financial measures have been presented with, and reconciled to, the most directly comparable GAAP financial measures. Investors should use these non-GAAP financial measures only in conjunction with the comparable GAAP financial measures.

(Additional Financial Data Follows)


CORELOGIC, INC.

CONDENSED CONSOLIDATED INCOME STATEMENTS

UNAUDITED


For the Three Months Ended


For the Nine Months Ended


September 30,


September 30,

(in thousands, except per share amounts)

2011


2010


2011


2010

Operating revenues

$

348,446



$

330,146



$

993,149



$

964,910


External cost of revenues

78,178



76,543



211,457



214,713


Salaries and benefits

131,523



133,812



414,545



406,097


Other operating expenses

76,061



50,604



209,739



191,418


Depreciation and amortization

34,844



23,495



84,160



72,198


Total operating expenses

320,606



284,454



919,901



884,426


Income from continuing operations

27,840



45,692



73,248



80,484


Interest  income/(expense), net:








Interest income

817



1,541



4,005



2,829


Interest expense

(15,236)



(8,956)



(47,783)



(25,325)


Total interest expense,  net

(14,419)



(7,415)



(43,778)



(22,496)


(Loss)/gain on investment and other income

(4,118)



2,072



86,783



(659)


Income from continuing operations before equity in earnings of affiliates and income taxes

9,303



40,349



116,253



57,329


Provision/(benefit) for income taxes

20,535



(5,580)



76,829



4,193


(Loss)/income from continuing operations before equity in earnings of affiliates

(11,232)



45,929



39,424



53,136


Equity in earnings of affiliates, net of tax

8,340



13,507



20,393



29,593


(Loss)/income from continuing operations

(2,892)



59,436



59,817



82,729


Loss from discontinued operations, net of tax

(104,220)



(142,479)



(111,125)



(93,688)


Net loss

(107,112)



(83,043)



(51,308)



(10,959)


Less:  Net income attributable to noncontrolling interests

78



10,372



1,142



28,629


Net loss attributable to CoreLogic

$

(107,190)



$

(93,415)



$

(52,450)



$

(39,588)


Amounts attributable to CoreLogic stockholders:








(Loss)/income from continuing operations

$

(2,970)



$

49,064



$

58,675



$

54,100


Loss from discontinued operations, net of tax

(104,220)



(142,479)



(111,125)



(93,688)


Net loss

$

(107,190)



$

(93,415)



$

(52,450)



$

(39,588)


Basic (loss)/income per share:








(Loss)/income from continuing operations attributable to CoreLogic stockholders

$

(0.03)



$

0.42



$

0.53



$

0.49


Loss from discontinued operations attributable to CoreLogic stockholders, net of tax

(0.98)



(1.22)



(1.01)



(0.85)


Net loss attributable to CoreLogic

$

(1.01)



$

(0.80)



$

(0.48)



$

(0.36)


Diluted (loss)/income per share:








(Loss)/income from continuing operations attributable to CoreLogic stockholders

$

(0.03)



$

0.42



$

0.53



$

0.49


Loss from discontinued operations attributable to CoreLogic stockholders, net of tax

(0.98)



(1.22)



(1.01)



(0.85)


Net (loss)/income attributable to CoreLogic

$

(1.01)



$

(0.80)



$

(0.48)



$

(0.36)


Weighted-average common shares outstanding:








Basic

106,414



116,991



109,993



109,800


Diluted

106,414



117,829



110,591



110,669





CORELOGIC, INC

CONDENSED CONSOLIDATED BALANCE SHEETS

UNAUDITED


(in thousands, except per share value)

September 30,


December 31,

Assets

2011


2010

Current assets:




Cash and cash equivalents

$

138,668



$

426,212


Marketable securities

34,970



75,221


Accounts receivable (less allowance for doubtful accounts of $15,437 and $12,314 in 2011 and 2010, respectively)

215,205



176,413


Prepaid expenses and other current assets

54,715



42,793


Income tax receivable

61,510



30,587


Deferred tax asset, current

28,157



13,150


Due from FAFC, net

581




Assets of discontinued operations

76,111



262,275


Total current assets

609,917



1,026,651


Property and equipment, net

231,294



197,426


Goodwill, net

1,468,663



1,289,888


Other identifiable intangible assets, net

170,408



109,850


Capitalized data and database costs, net

298,887



211,331


Investment in affiliates

143,850



165,709


Deferred income tax assets, long-term

28,361



33,548


Restricted cash

20,924



21,095


Other assets

149,800



180,882


Total assets

$

3,122,104



$

3,236,380


Liabilities and Equity




Current liabilities:




Accounts payable and accrued expenses

$

151,763



$

123,936


Accrued salaries and benefits

60,629



76,212


Income taxes payable

4,288




Deferred revenue, current

200,505



186,031


Mandatorily redeemable noncontrolling interests



72,000


Current portion of long-term debt

62,482



233,452


Due to FAFC, net



18,097


Liabilities of discontinued operations

42,505



40,162


Total current liabilities

522,172



749,890


Long-term debt, net of current

848,616



487,437


Deferred revenue, net of current

335,322



350,827


Deferred income tax liabilities, long term

10,279




Other liabilities

136,908



101,531


     Total liabilities

1,853,297



1,689,685


Equity:




CoreLogic, Inc.'s (CoreLogic) 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; 106,481 and 115,499 shares issued and

          outstanding as of September 30, 2011 and December 31,

          2010, respectively

1



1


    Additional paid-in capital

1,052,587



1,229,806


    Retained earnings

246,140



298,590


    Accumulated other comprehensive (loss)/income

(32,384)



15,943


         Total CoreLogic's stockholders' equity

1,266,344



1,544,340


Noncontrolling interests

2,463



2,355


    Total equity

1,268,807



1,546,695


    Total liabilities and equity

$

3,122,104



$

3,236,380




RECONCILIATION OF AS REPORTED TO AS ADJUSTED FINANCIAL RESULTS FOR CONSOLIDATED CORELOGIC, INC.



For the Three Months Ended September 30, 2011

(in thousands)

As Reported

Equity in Earnings

Severance

Efficiency Investments

Asset Impairments

Spin Costs

As

Adjusted

Revenue








Data & Analytics

$

184,509


$

2,089


$


$


$


$


$

186,598


Business and Information Services

169,587


11,639






181,226


Corporate

(5,650)


175






(5,475)


CoreLogic

$

348,446


$

13,903


$


$


$


$


$

362,349










Pretax Income








Data & Analytics

$

27,928


$

2,089


$

125


$


$

6,463


$


$

36,605


Business and Information Services

25,276


11,639


1,243



502



38,660


Corporate

(43,901)


175


338


10,052


(600)



(33,936)


CoreLogic

$

9,303


$

13,903


$

1,706


$

10,052


$

6,365


$


$

41,329










EBITDA








Data & Analytics

$

53,665


$


$

125


$


$

1,152


$


$

54,942


Business and Information Services

43,096



1,243





44,339


Corporate

(24,290)

)


338


10,052




(13,900)


CoreLogic

$

72,471


$


$

1,706


$

10,052


$

1,152


$


$

85,381





For the Three Months Ended September 30, 2010

(in thousands)

As Reported

Equity in Earnings

Severance

Efficiency Investments

Asset Impairments

Spin Costs

As

Adjusted

Revenue








Data & Analytics

$

161,185


$

4,067


$


$


$


$


$

165,252


Business and Information Services

174,955


18,304






193,259


Corporate

(5,994)


89






(5,905)


CoreLogic

$

330,146


$

22,460


$


$


$


$


$

352,606










Pretax Income








Data & Analytics

$

34,884


$

4,067


$

218


$


$


$


$

39,169


Business and Information Services

34,434


18,304


1,100





53,838


Corporate

(28,969)


89


433




1,697


(26,750)


CoreLogic

$

40,349


$

22,460


$

1,751


$


$


$

1,697


$

66,257










EBITDA








Data & Analytics

$

51,910


$


$

218


$


$


$


$

52,128


Business and Information Services

57,469



1,100





58,569


Corporate

(15,662)



433




1,697


(13,532)


CoreLogic

$

93,717


$


$

1,751


$


$


$

1,697


$

97,165





RECONCILIATION OF AS REPORTED TO AS ADJUSTED FINANCIAL RESULTS FOR CONSOLIDATED CORELOGIC, INC.

(Unaudited, in thousands)

3Q11

3Q10

Net income

$

(107,190)


$

(93,415)


Less:  Discontinued operations, net of tax

(104,220)


(142,479)


Plus:   Noncontrolling interests

78


10,372


          Income tax provision, includes income tax provision



associated with equity in earnings of affiliates.

26,098


3,373


          Interest expense, net

14,419


7,415


          Depreciation & amortization

34,844


23,495


          Other significant adjustments

12,912


3,446


Adjusted EBITDA

$

85,381


$

97,165





RECONCILIATION OF AS REPORTED TO AS ADJUSTED FINANCIAL RESULTS FOR TOTAL DISCONTIUED OPERATIONS


(Unaudited, in thousands)

3Q11

Loss from discontinued operations before income taxes

$

(168,968)


Plus:  Impairment charges

123,348


         Depreciation & amortization

30,005


         Interest expense, net

40


Adjusted EBITDA from discontinued operations

$

(15,575)





SIGNIFICANT ADJUSTMENTS BETWEEN GAAP & AS-ADJUSTED RESULTS

($ in Thousands)

September 30, 2011

 Description




Revenue



  Re-class of Equity in Earnings of Affiliates

$

13,903


Reflects GAAP equity in earnings of affiliates before
tax as a component of adjusted revenue

Expenses



  Salaries and benefits

1,706


Restructuring-related severance and retention
expenses

  Professional, legal and litigation

10,052


Expenses related to announced one-time efficiency
investments

  Amortization & other

5,544


Software and intangibles impairment

Gain/(Loss) on Investment and Other Income



  Investment losses

821


Investment impairment

Total impact to pretax income

$

32,026






SOURCE CoreLogic

Contact:
CoreLogic
media, Alyson Austin, Corporate Communications
Phone: +1-714-250-6180
Email Contact
investors, Dan Smith, Investor Relations
Phone: +1-703-610-5410
Email Contact
Web: http://www.corelogic.com