Stewart Reports Fourth Quarter 2023 Results
- None.
- None.
Insights
The reported revenue and net income declines for Stewart Information Services Corporation reflect broader market challenges, particularly the impact of elevated interest rates on real estate transactions. The 14% drop in title segment operating revenues and the 11% to 16% decline in direct title revenues mirror the reduced transaction volumes in both residential and commercial real estate sectors. This trend is significant because title services are directly correlated with real estate market activity, which is sensitive to interest rate fluctuations.
Investors should note the company's strategic response, which includes cost discipline and long-term investments aimed at resilience. While the short-term outlook remains cautious due to expected continued high interest rates, the management's strategy could position the company for recovery as market conditions improve. The increase in investment income by 89% is a positive note, suggesting effective asset management that could partially offset the declines in core business segments.
Stewart Information Services Corporation's adjusted pretax margin reduced slightly from 5.2% to 5.0%, indicating a tighter control over expenses in relation to declining revenues. The decrease in employee costs by 7% and other operating expenses by 12% suggests proactive cost management in response to the downturn. The increase in the income tax rate due to non-deductible expenses on lower domestic pretax income is a concern as it affects the net income available to shareholders.
The improved net cash provided by operations to $40.6 million, up from $24.8 million, is a strong indicator of the company's operational efficiency and ability to generate cash under challenging conditions. These financial health indicators are crucial for stakeholders evaluating the company's ability to sustain operations and invest in growth opportunities during a market downturn.
The reported figures by Stewart Information Services Corporation are a microcosm of the current economic climate, particularly the influence of monetary policy on the housing market. The company's performance reflects the sensitivity of the real estate sector to interest rate hikes, which tend to dampen buying and refinancing activities. The decline in transaction volumes is consistent with economic models that predict reduced consumer spending and borrowing in higher interest environments.
The moderation of interest rates cited by the CEO suggests a potential plateauing of the rate hikes, which could lead to a gradual stabilization of the real estate market. However, the anticipation of a negative impact on transaction volumes in the first half of 2024 indicates that the company and the market at large, are not out of the woods yet. The company's strategic investments during the downturn could be a preparatory step for capitalizing on market recovery when conditions improve.
- Total revenues of
$582.2 million $577.4 million $655.9 million $643.2 million - Net income of
$8.8 million $16.6 million $13.3 million $22.9 million - Diluted EPS of
$0.32 $0.60 $0.49 $0.84
Fourth quarter 2023 results included
"Our fourth quarter results reflect continuing uncertainty in the real estate market due to the higher interest rate environment coupled with the normal seasonality. Although we are encouraged by the moderation of interest rates into the mid – 6 percent range during the fourth quarter and into early 2024, we maintain our outlook that higher interest rates will negatively impact real estate transaction volume in the first half of 2024," commented Fred Eppinger, chief executive officer. "We have made excellent progress on our strategic investments during 2023 and will continue to focus on balancing thoughtful cost discipline with investment in these long-term enterprise initiatives to create a stronger and more resilient company."
Selected Financial Information
Summary results of operations are as follows (dollars in millions, except per share amounts, pretax margin and adjusted pretax margin, and amounts may not add as presented due to rounding):
Quarter Ended December 31, | Year Ended December 31, | ||||
2023 | 2022 | 2023 | 2022 | ||
Total revenues | 582.2 | 655.9 | 2,257.3 | 3,069.3 | |
Pretax income before noncontrolling interests | 18.8 | 20.8 | 60.9 | 232.7 | |
Income tax expense | (5.7) | (2.5) | (15.3) | (50.9) | |
Net income attributable to noncontrolling interests | (4.3) | (4.9) | (15.2) | (19.5) | |
Net income attributable to Stewart | 8.8 | 13.3 | 30.4 | 162.3 | |
Non-GAAP adjustments, after taxes* | 7.8 | 9.6 | 36.2 | 43.1 | |
Adjusted net income attributable to Stewart* | 16.6 | 22.9 | 66.6 | 205.4 | |
Pretax margin | 3.2 % | 3.2 % | 2.7 % | 7.6 % | |
Adjusted pretax margin* | 5.0 % | 5.2 % | 4.8 % | 9.5 % | |
Net income per diluted Stewart share | 0.32 | 0.49 | 1.11 | 5.94 | |
Adjusted net income per diluted Stewart share* | 0.60 | 0.84 | 2.42 | 7.51 | |
* Adjusted net income, adjusted pretax margin and adjusted net income per diluted share are non-GAAP measures. See Appendix A for explanation and reconciliation of non-GAAP adjustments. |
Title Segment
Summary results of the title segment are as follows (dollars in millions, except pretax margin and adjusted pretax margin):
Quarter Ended December 31, | ||||||
2023 | 2022 | % Change | ||||
Operating revenues | 503.0 | 581.6 | (14 %) | |||
Investment income | 13.0 | 6.9 | 89 % | |||
Net realized and unrealized gains | 5.1 | 10.3 | (50 %) | |||
Pretax income | 27.3 | 26.9 | 2 % | |||
Non-GAAP adjustments to pretax income* | 4.0 | 8.3 | ||||
Adjusted pretax income* | 31.4 | 35.2 | (11 %) | |||
Pretax margin | 5.2 % | 4.5 % | ||||
Adjusted pretax margin* | 6.1 % | 6.0 % | ||||
* Adjusted pretax income and adjusted pretax margin are non-GAAP financial measures. See Appendix A for explanation and reconciliation of non-GAAP adjustments. | ||||||
Fourth quarter title segment operating revenues decreased
Total employee costs and other operating expenses in the fourth quarter 2023 were lower by
Investment income in the fourth quarter 2023 increased
Direct title revenues information is presented below (dollars in millions):
Quarter Ended December 31, | ||||
2023 | 2022 | % Change | ||
Non-commercial: | ||||
Domestic | 153.8 | 171.3 | (10 %) | |
International | 24.0 | 24.0 | 0 % | |
177.8 | 195.3 | (9 %) | ||
Commercial: | ||||
Domestic | 56.1 | 66.9 | (16 %) | |
International | 6.5 | 7.7 | (16 %) | |
62.6 | 74.6 | (16 %) | ||
Total direct title revenues | 240.4 | 269.9 | (11 %) | |
Total non-commercial domestic revenues in the fourth quarter 2023 declined
Real Estate Solutions Segment
Summary results of the real estate solutions segment are as follows (dollars in millions, except pretax margin and adjusted pretax margin):
Quarter Ended December 31, | ||||
2023 | 2022 | % Change | ||
Operating revenues | 61.4 | 54.7 | 12 % | |
Pretax income | 1.4 | 0.4 | 276 % | |
Non-GAAP adjustments to pretax income* | 6.0 | 6.6 | ||
Adjusted pretax income* | 7.4 | 7.0 | 5 % | |
Pretax margin | 2.3 % | 0.7 % | ||
Adjusted pretax margin* | 12.0 % | 12.8 % | ||
* Adjusted pretax income and adjusted pretax margin are non-GAAP financial measures. See Appendix A for an explanation and reconciliation of non-GAAP adjustments. |
The segment's fourth quarter operating revenues improved
Corporate and Other Segment
The segment's results for the fourth quarter 2023 and 2022 were primarily driven by net expenses attributable to corporate operations which were
Expenses
Fourth quarter consolidated employee costs were lower by
Total other operating expenses in the fourth quarter 2023 decreased
Other
Net cash provided by operations improved to
Fourth Quarter Earnings Call
Stewart will hold a conference call to discuss the fourth quarter 2023 earnings at 8:30 a.m. Eastern Time on Thursday, February 8, 2024. To participate, dial (800) 267-6316 (
About Stewart
Stewart (NYSE-STC) is a global real estate services company, offering products and services through our direct operations, network of Stewart Trusted Providers™ and family of companies. From residential and commercial title insurance and closing and settlement services to specialized offerings for the mortgage and real estate industries, we offer the comprehensive service, deep expertise and solutions our customers need for any real estate transaction. At Stewart, we are dedicated to becoming the premier title services company and we are committed to doing so by partnering with our customers to create mutual success. Learn more at stewart.com.
Cautionary statement regarding forward-looking statements. Certain statements in this earnings release are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, as amended. Such forward-looking statements relate to future, not past, events and often address our expected future business and financial performance. These statements often contain words such as "may," "expect," "anticipate," "intend," "plan," "believe," "seek," "will," "foresee" or other similar words. Forward-looking statements by their nature are subject to various risks and uncertainties that could cause our actual results to be materially different than those expressed in the forward-looking statements. These risks and uncertainties include, among other things, the volatility of economic conditions; adverse changes in the level of real estate activity; changes in mortgage interest rates, existing and new home sales, and availability of mortgage financing; our ability to respond to and implement technology changes, including the completion of the implementation of our enterprise systems; the impact of unanticipated title losses or the need to strengthen our policy loss reserves; any effect of title losses on our cash flows and financial condition; the ability to attract and retain highly productive sales associates; the impact of vetting our agency operations for quality and profitability; independent agency remittance rates; changes to the participants in the secondary mortgage market and the rate of refinancing that affects the demand for title insurance products; regulatory non-compliance, fraud or defalcations by our title insurance agencies or employees; our ability to timely and cost-effectively respond to significant industry changes and introduce new products and services; the outcome of pending litigation; our ability to manage risks associated with potential cybersecurity or other privacy or data security breaches; the impact of changes in governmental and insurance regulations, including any future reductions in the pricing of title insurance products and services; our dependence on our operating subsidiaries as a source of cash flow; our ability to access the equity and debt financing markets when and if needed; our ability to grow our international operations; seasonality and weather; and our ability to respond to the actions of our competitors. These risks and uncertainties, as well as others, are discussed in more detail in our documents filed with the Securities and Exchange Commission, including our Annual Report on Form 10-K for the year ended December 31, 2022, and if applicable, as supplemented by any risk factors contained in our Quarterly Reports on Form 10-Q, and our Current Reports on Form 8-K filed subsequently. All forward-looking statements included in this earnings release are expressly qualified in their entirety by such cautionary statements. We expressly disclaim any obligation to update, amend or clarify any forward-looking statements contained in this earnings release to reflect events or circumstances that may arise after the date hereof, except as may be required by applicable law.
ST-IR
STEWART INFORMATION SERVICES CORPORATION CONDENSED STATEMENTS OF INCOME (In thousands of dollars, except per share amounts and except where noted) | |||||
Quarter Ended December 31 (Unaudited), | Year Ended December 31, | ||||
2023 | 2022 | 2023 | 2022 | ||
Revenues: | |||||
Title revenues: | |||||
Direct operations | 240,432 | 269,894 | 962,674 | 1,246,258 | |
Agency operations | 262,513 | 311,697 | 985,989 | 1,466,243 | |
Real estate solutions and other | 61,408 | 54,697 | 263,577 | 335,850 | |
Total operating revenues | 564,353 | 636,288 | 2,212,240 | 3,048,351 | |
Investment income | 13,021 | 6,903 | 45,135 | 22,421 | |
Net realized and unrealized gains (losses) | 4,795 | 12,718 | (34) | (1,476) | |
582,169 | 655,909 | 2,257,341 | 3,069,296 | ||
Expenses: | |||||
Amounts retained by agencies | 217,021 | 256,752 | 813,519 | 1,208,307 | |
Employee costs | 178,084 | 191,715 | 712,794 | 802,001 | |
Other operating expenses | 127,171 | 145,056 | 507,701 | 648,022 | |
Title losses and related claims | 20,555 | 21,628 | 80,282 | 102,733 | |
Depreciation and amortization | 15,600 | 15,075 | 62,447 | 57,178 | |
Interest | 4,959 | 4,932 | 19,737 | 18,403 | |
563,390 | 635,158 | 2,196,480 | 2,836,644 | ||
Income before taxes and noncontrolling interests | 18,779 | 20,751 | 60,861 | 232,652 | |
Income tax expense | (5,675) | (2,488) | (15,263) | (50,864) | |
Net income | 13,104 | 18,263 | 45,598 | 181,788 | |
Less net income attributable to noncontrolling interests | 4,289 | 4,949 | 15,159 | 19,483 | |
Net income attributable to Stewart | 8,815 | 13,314 | 30,439 | 162,305 | |
Net earnings per diluted share attributable to Stewart | 0.32 | 0.49 | 1.11 | 5.94 | |
Diluted average shares outstanding (000) | 27,751 | 27,276 | 27,520 | 27,347 | |
Selected financial information: | |||||
Net cash provided by operations | 40,585 | 24,820 | 83,042 | 191,860 | |
Other comprehensive income (loss) | 23,406 | 13,465 | 16,128 | (51,596) | |
Fourth Quarter Domestic Order Counts: | |||||||||||
Opened Orders | Oct | Nov | Dec | Total | Closed Orders | Oct | Nov | Dec | Total | ||
Commercial | 1,031 | 1,335 | 1,381 | 3,747 | Commercial | 1,074 | 1,264 | 1,463 | 3,801 | ||
Purchase | 16,995 | 14,076 | 11,679 | 42,750 | Purchase | 12,187 | 10,595 | 10,989 | 33,771 | ||
Refinancing | 5,165 | 5,038 | 5,194 | 15,397 | Refinancing | 3,479 | 3,034 | 3,045 | 9,558 | ||
Other | 1,912 | 1,506 | 3,271 | 6,689 | Other | 2,000 | 1,309 | 1,367 | 4,676 | ||
Total | 25,103 | 21,955 | 21,525 | 68,583 | Total | 18,740 | 16,202 | 16,864 | 51,806 | ||
Opened Orders | Oct | Nov | Dec | Total | Closed Orders | Oct | Nov | Dec | Total | ||
Commercial | 1,243 | 1,124 | 1,807 | 4,174 | Commercial | 1,242 | 1,141 | 2,058 | 4,441 | ||
Purchase | 15,591 | 13,400 | 11,562 | 40,553 | Purchase | 12,560 | 11,480 | 11,340 | 35,380 | ||
Refinancing | 4,858 | 4,549 | 3,682 | 13,089 | Refinancing | 3,866 | 3,231 | 3,151 | 10,248 | ||
Other | 1,844 | 1,428 | 1,219 | 4,491 | Other | 1,403 | 964 | 926 | 3,293 | ||
Total | 23,536 | 20,501 | 18,270 | 62,307 | Total | 19,071 | 16,816 | 17,475 | 53,362 | ||
STEWART INFORMATION SERVICES CORPORATION CONDENSED BALANCE SHEETS (In thousands of dollars) | ||
December 31, | December 31, | |
Assets: | ||
Cash and cash equivalents | 233,365 | 248,367 |
Short-term investments | 39,023 | 24,318 |
Investments in debt and equity securities, at fair value | 679,936 | 710,083 |
Receivables – premiums from agencies | 38,676 | 39,921 |
Receivables – other | 93,811 | 85,111 |
Allowance for uncollectible amounts | (7,583) | (7,309) |
Property and equipment, net | 82,335 | 81,539 |
Operating lease assets, net | 115,879 | 127,830 |
Title plants | 73,359 | 73,358 |
Goodwill | 1,072,129 | 1,072,982 |
Intangible assets, net of amortization | 193,196 | 199,084 |
Deferred tax assets | 3,776 | 2,590 |
Other assets | 84,959 | 80,005 |
2,702,861 | 2,737,879 | |
Liabilities: | ||
Notes payable | 445,290 | 447,006 |
Accounts payable and accrued liabilities | 190,054 | 196,541 |
Operating lease liabilities | 135,654 | 148,003 |
Estimated title losses | 528,269 | 549,448 |
Deferred tax liabilities | 25,045 | 26,616 |
1,324,312 | 1,367,614 | |
Stockholders' equity: | ||
Common Stock and additional paid-in capital | 338,451 | 324,344 |
Retained earnings | 1,070,841 | 1,091,816 |
Accumulated other comprehensive loss | (35,215) | (51,343) |
Treasury stock | (2,666) | (2,666) |
Stockholders' equity attributable to Stewart | 1,371,411 | 1,362,151 |
Noncontrolling interests | 7,138 | 8,114 |
Total stockholders' equity | 1,378,549 | 1,370,265 |
2,702,861 | 2,737,879 | |
Number of shares outstanding (000) | 27,370 | 27,130 |
Book value per share | 50.11 | 50.21 |
STEWART INFORMATION SERVICES CORPORATION SEGMENT INFORMATION (In thousands of dollars)
| |||||||||
Quarter Ended: | December 31, 2023 | December 31, 2022 | |||||||
Title | Real | Corporate | Total | Title | Real | Corporate | Total | ||
Revenues: | |||||||||
Operating revenues | 502,945 | 61,408 | - | 564,353 | 581,591 | 54,697 | - | 636,288 | |
Investment income | 12,996 | 25 | - | 13,021 | 6,891 | 12 | - | 6,903 | |
Net realized and unrealized gains (losses) | 5,094 | (3) | (296) | 4,795 | 10,262 | - | 2,456 | 12,718 | |
521,035 | 61,430 | (296) | 582,169 | 598,744 | 54,709 | 2,456 | 655,909 | ||
Expenses: | |||||||||
Amounts retained by agencies | 217,021 | - | - | 217,021 | 256,752 | - | - | 256,752 | |
Employee costs | 163,142 | 11,987 | 2,955 | 178,084 | 177,371 | 11,860 | 2,484 | 191,715 | |
Other operating expenses | 83,777 | 41,587 | 1,807 | 127,171 | 107,118 | 36,293 | 1,645 | 145,056 | |
Title losses and related claims | 20,555 | - | - | 20,555 | 21,628 | - | - | 21,628 | |
Depreciation and amortization | 8,819 | 6,401 | 380 | 15,600 | 8,617 | 6,182 | 276 | 15,075 | |
Interest | 378 | 48 | 4,533 | 4,959 | 338 | - | 4,594 | 4,932 | |
493,692 | 60,023 | 9,675 | 563,390 | 571,824 | 54,335 | 8,999 | 635,158 | ||
Income (loss) before taxes | 27,343 | 1,407 | (9,971) | 18,779 | 26,920 | 374 | (6,543) | 20,751 | |
Year Ended: | December 31, 2023 | December 31, 2022 | |||||||
Title | Real | Corporate | Total | Title | Real | Corporate | Total | ||
Revenues: | |||||||||
Operating revenues | 1,948,663 | 263,577 | - | 2,212,240 | 2,712,501 | 296,673 | 39,177 | 3,048,351 | |
Investment income | 45,028 | 107 | - | 45,135 | 22,392 | 29 | - | 22,421 | |
Net realized and unrealized gains (losses) | 3,437 | (3) | (3,468) | (34) | (1,149) | - | (327) | (1,476) | |
1,997,128 | 263,681 | (3,468) | 2,257,341 | 2,733,744 | 296,702 | 38,850 | 3,069,296 | ||
Expenses: | |||||||||
Amounts retained by agencies | 813,519 | - | - | 813,519 | 1,208,307 | - | - | 1,208,307 | |
Employee costs | 648,832 | 49,320 | 14,642 | 712,794 | 735,747 | 50,462 | 15,792 | 802,001 | |
Other operating expenses | 320,529 | 179,640 | 7,532 | 507,701 | 401,724 | 204,053 | 42,245 | 648,022 | |
Title losses and related claims | 80,282 | - | - | 80,282 | 102,733 | - | - | 102,733 | |
Depreciation and amortization | 35,000 | 25,802 | 1,645 | 62,447 | 29,715 | 25,563 | 1,900 | 57,178 | |
Interest | 1,442 | 239 | 18,056 | 19,737 | 386 | - | 18,017 | 18,403 | |
1,899,604 | 255,001 | 41,875 | 2,196,480 | 2,478,612 | 280,078 | 77,954 | 2,836,644 | ||
Income (loss) before taxes | 97,524 | 8,680 | (45,343) | 60,861 | 255,132 | 16,624 | (39,104) | 232,652 | |
Appendix A
Non-GAAP Adjustments
Management uses a variety of financial and operational measurements other than its financial statements prepared in accordance with United States Generally Accepted Accounting Principles (GAAP) to analyze its performance. These include: (1) adjusted revenues, which are reported revenues adjusted for net realized and unrealized gains and losses, and other adjustments (revenues of sold real estate brokerage company), and (2) adjusted pretax income and adjusted net income, which are reported pretax income and reported net income after earnings from noncontrolling interests, respectively, adjusted for net realized and unrealized gains and losses, acquired intangible asset amortization, office closure costs, executive severance expenses, regulatory settlement and litigation expenses, state sales tax assessment expense (which was related to an acquisition), and other adjustments (pretax results of sold real estate brokerage company). Adjusted diluted earnings per share (adjusted diluted EPS) is calculated using adjusted net income divided by the diluted average weighted outstanding shares. Adjusted pretax margin is calculated using adjusted pretax income divided by adjusted total revenues. Management views these measures as important performance measures of core profitability for its operations and as key components of its internal financial reporting. Management believes investors benefit from having access to the same financial measures that management uses.
Below are reconciliations of the non-GAAP financial measures used by management to the most directly comparable GAAP measures for the quarter and year ended December 31, 2023 and 2022 (dollars in millions, except shares, per share amounts and pretax margins, and amounts may not add as presented due to rounding).
Quarter Ended Dec. 31, | Year Ended Dec. 31, | |||||||
2023 | 2022 | % Chg | 2023 | 2022 | % Chg | |||
Total revenues | 582.2 | 655.9 | (11 %) | 2,257.3 | 3,069.3 | (27 %) | ||
Non-GAAP revenue adjustments: | ||||||||
Net realized and unrealized (gains) losses | (4.8) | (12.7) | 0.1 | 1.5 | ||||
Other adjustments | - | - | - | (39.2) | ||||
Adjusted total revenues | 577.4 | 643.2 | (10 %) | 2,257.4 | 3,031.6 | (26 %) | ||
Pretax income | 18.8 | 20.8 | (10 %) | 60.9 | 232.7 | (74 %) | ||
Non-GAAP pretax adjustments: | ||||||||
Net realized and unrealized (gains) losses | (4.8) | (12.7) | 0.1 | 1.5 | ||||
Office closure costs | 5.5 | 7.5 | 7.3 | 10.5 | ||||
Executive severance expenses | 0.9 | 2.7 | 3.1 | 3.9 | ||||
Regulatory settlement and litigation expenses | - | 6.5 | - | 6.5 | ||||
State sales tax assessment expense | - | - | 1.2 | - | ||||
Other adjustments | - | - | - | 0.9 | ||||
20.4 | 24.7 | 72.5 | 256.0 | |||||
Acquired intangible asset amortization | 8.7 | 8.6 | 36.0 | 33.3 | ||||
Adjusted pretax income | 29.1 | 33.3 | (13 %) | 108.5 | 289.3 | (63 %) | ||
GAAP pretax margin | 3.2 % | 3.2 % | 2.7 % | 7.6 % | ||||
Adjusted pretax margin | 5.0 % | 5.2 % | 4.8 % | 9.5 % | ||||
Net income attributable to Stewart | 8.8 | 13.3 | (34 %) | 30.4 | 162.3 | (81 %) | ||
Non-GAAP pretax adjustments: | ||||||||
Net realized and unrealized (gains) losses | (4.8) | (12.7) | 0.1 | 1.5 | ||||
Acquired intangible asset amortization | 8.7 | 8.6 | 36.0 | 33.3 | ||||
Office closure costs | 5.5 | 7.5 | 7.3 | 10.5 | ||||
Executive severance expenses | 0.9 | 2.7 | 3.1 | 3.9 | ||||
Regulatory settlement and litigation expenses | - | 6.5 | - | 6.5 | ||||
State sales tax assessment expense | - | - | 1.2 | - | ||||
Other adjustments | - | - | - | 0.9 | ||||
Net tax effects of non-GAAP adjustments | (2.5) | (3.0) | (11.4) | (13.6) | ||||
Non-GAAP adjustments, after taxes | 7.8 | 9.6 | 36.2 | 43.1 | ||||
Adjusted net income attributable to Stewart | 16.6 | 22.9 | (27 %) | 66.6 | 205.4 | (68 %) | ||
Diluted average shares outstanding (000) | 27,751 | 27,276 | 27,520 | 27,347 | ||||
GAAP net income per share | 0.32 | 0.49 | 1.11 | 5.94 | ||||
Adjusted net income per share | 0.60 | 0.84 | 2.42 | 7.51 | ||||
Quarter Ended Dec. 31, | Year Ended Dec. 31, | |||||||
2023 | 2022 | % Chg | 2023 | 2022 | % Chg | |||
Title Segment: | ||||||||
Revenues | 521.0 | 598.7 | (13 %) | 1,997.1 | 2,733.7 | (27 %) | ||
Net realized and unrealized (gains) losses | (5.1) | (10.3) | (3.4) | 1.1 | ||||
Adjusted revenues | 515.9 | 588.5 | (12 %) | 1,993.7 | 2,734.9 | (27 %) | ||
Pretax income | 27.3 | 26.9 | 2 % | 97.5 | 255.1 | (62 %) | ||
Non-GAAP revenue adjustments: | ||||||||
Net realized and unrealized (gains) losses | (5.1) | (10.3) | (3.4) | 1.1 | ||||
Acquired intangible asset amortization | 2.9 | 2.8 | 12.3 | 9.1 | ||||
Office closure costs | 5.5 | 6.9 | 7.3 | 9.9 | ||||
Severance expenses | 0.7 | 2.4 | 2.3 | 4.0 | ||||
Regulatory settlement and litigation expenses | - | 6.5 | - | 6.5 | ||||
Adjusted pretax income | 31.4 | 35.2 | (11 %) | 116.0 | 285.8 | (59 %) | ||
GAAP pretax margin | 5.2 % | 4.5 % | 4.9 % | 9.3 % | ||||
Adjusted pretax margin | 6.1 % | 6.0 % | 5.8 % | 10.5 % | ||||
Real Estate Solutions Segment: | ||||||||
Revenues | 61.4 | 54.7 | 12 % | 263.7 | 296.7 | (11 %) | ||
Pretax income | 1.4 | 0.4 | 276 % | 8.7 | 16.6 | (48 %) | ||
Non-GAAP revenue adjustments: | ||||||||
Acquired intangible asset amortization | 5.8 | 5.8 | 23.7 | 24.0 | ||||
Severance and office closure expenses | 0.2 | 0.8 | 0.3 | 0.9 | ||||
State sales tax assessment expense | - | - | 1.2 | - | ||||
Adjusted pretax income | 7.4 | 7.0 | 5 % | 33.8 | 41.5 | (19 %) | ||
GAAP pretax margin | 2.3 % | 0.7 % | 3.3 % | 5.6 % | ||||
Adjusted pretax margin | 12.0 % | 12.8 % | 12.8 % | 14.0 % | ||||
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SOURCE Stewart Information Services Corporation
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