Fidelity Profits Soar on Title Insurance Boom
Improvements in the title business boosted profits for title and specialty insurance provider Fidelity National Financial (FNF) to $91.9m ($0.40 per share) in Q209, up from $6.9m in Q208. The bulk of the increase came from Fidelity’s National Title Group, which saw pre-tax earnings jump to $133.3m in Q209 from $5.1m in the year-ago quarter. The company’s specialty interest department also grew since last quarter, earning $14.5m in Q209 from $13.2 in Q208. Fidelity closed 524,100 direct title orders in Q209, up from 307,500 in Q208. “We achieved a significant increase in revenue and earnings in the title business as we began to close a meaningful number of the orders we opened in the first quarter and early second quarter, producing a 9.2% pre-tax margin for the full quarter,” Fidelity’s chairman, William Foley II, said in a statement. “Additionally, we exceeded a 10% pre-tax title margin for the month of June.” Fidelity issued 18.2m shares of common stock in April, raising $331m, which was used to reduce outstanding debt. The company now touts a 22% debt-to-capital ratio. Write to Austin Kilgore.