Fidelity National Title 3Q Profit Falls
|October 25, 2006|
Insurance provider Fidelity National Title Group Inc. said Wednesday its third-quarter profit fell 39 percent as it sold mostly purchase transactions, as opposed to more expensive refinance transactions.
Profit declined to $103.4 million, or 60 cents per share, from $169.7 million, or 98 cents per share, in the prior year quarter.
The results missed the consensus forecast of 70 cents per share, according to a Thomson Financial poll.
Sales fell 15 percent to $1.51 billion from $1.77 billion booked in the year-ago quarter, while Wall Street was looking for sales of $1.59 million.
"The third quarter was one of transition for our title insurance business," said Chairman and Chief Executive William P. Foley II. "While open order counts remained fairly consistent, the mix of business clearly shifted from a majority of purchase transactions toward more refinance transactions, which generate about half of the revenue of a purchase transaction."
He said the company cut its staff by 650 during the quarter, which helped reduce personnel costs by $75 million versus the prior-year quarter.
Separately, Fidelity National Title said it approved a stock repurchase program for up to 25 million shares over a three-year period.
Prior to Tuesday, Fidelity National Financial was the parent company of Fidelity National Title Group. Under a deal announced in June, Fidelity National Financial spun off most of its assets to Fidelity National Title.
Coopyright 2006 Associated Press