SEC Info  
    Home      Search      My Interests      Help      Sign In      Please Sign In

Corelogic, Inc. – ‘10-Q’ for 9/30/19

On:  Thursday, 10/24/19, at 3:10pm ET   ·   For:  9/30/19   ·   Accession #:  36047-19-98   ·   File #:  1-13585

Previous ‘10-Q’:  ‘10-Q’ on 7/25/19 for 6/30/19   ·   Next:  ‘10-Q’ on 5/1/20 for 3/31/20   ·   Latest:  ‘10-Q’ on 5/7/21 for 3/31/21

Find Words in Filings emoji
 
  in    Show  and   Hints

  As Of               Filer                 Filing    For·On·As Docs:Size

10/24/19  Corelogic, Inc.                   10-Q        9/30/19   82:11M

Quarterly Report   —   Form 10-Q   —   Sect. 13 / 15(d) – SEA’34
Filing Table of Contents

Document/Exhibit                   Description                      Pages   Size 

 1: 10-Q        Quarterly Report                                    HTML   1.42M 
 2: EX-31.1     Certification -- §302 - SOA'02                      HTML     30K 
 3: EX-31.2     Certification -- §302 - SOA'02                      HTML     30K 
 4: EX-32.1     Certification -- §906 - SOA'02                      HTML     26K 
 5: EX-32.2     Certification -- §906 - SOA'02                      HTML     26K 
36: R1          Cover                                               HTML     76K 
81: R2          Condensed Consolidated Balance Sheets (Unaudited)   HTML    119K 
56: R3          Condensed Consolidated Balance Sheets (Unaudited)   HTML     47K 
                (Parenthetical)                                                  
30: R4          Condensed Consolidated Statements of Operations     HTML    127K 
                (Unaudited)                                                      
38: R5          Condensed Consolidated Statements of Comprehensive  HTML     54K 
                Income (Unaudited) Statement                                     
82: R6          Condensed Consolidated Statements of Cash Flows     HTML    182K 
                (Unaudited)                                                      
57: R7          Condensed Consolidated Statement of Stockholder's   HTML     80K 
                Equity (Unaudited)                                               
28: R8          Basis of Condensed Consolidated Financial           HTML     80K 
                Statements                                                       
41: R9          Property and Equipment, Net                         HTML     44K 
70: R10         Goodwill, Net                                       HTML     48K 
62: R11         Other Intangible Assets, Net                        HTML     58K 
17: R12         Long-Term Debt                                      HTML    102K 
48: R13         Leases                                              HTML    120K 
69: R14         Operating Revenues                                  HTML    158K 
60: R15         Share-Based Compensation                            HTML    102K 
15: R16         Litigation and Regulatory Contingencies             HTML     30K 
47: R17         Income Taxes                                        HTML     29K 
68: R18         Earnings Per Share                                  HTML     81K 
63: R19         Fair Value of Financial Instruments                 HTML    155K 
27: R20         Acquisitions                                        HTML     42K 
40: R21         Segment Information                                 HTML    169K 
80: R22         Basis of Condensed Consolidated Financial           HTML     81K 
                Statements (Policies)                                            
59: R23         Basis of Condensed Consolidated Financial           HTML     48K 
                Statements (Tables)                                              
26: R24         Property and Equipment, Net (Tables)                HTML     40K 
39: R25         Goodwill, Net (Tables)                              HTML     48K 
79: R26         Other Intangible Assets, Net (Tables)               HTML     58K 
58: R27         Long-Term Debt (Tables)                             HTML     84K 
29: R28         Leases (Tables)                                     HTML    144K 
37: R29         Operating Revenues (Tables)                         HTML    138K 
43: R30         Share-Based Compensation (Tables)                   HTML     99K 
12: R31         Earnings Per Share (Tables)                         HTML     79K 
64: R32         Fair Value of Financial Instruments (Tables)        HTML    143K 
71: R33         Segment Information (Tables)                        HTML    160K 
44: R34         Basis of Condensed Consolidated Financial           HTML     79K 
                Statements (Narrative) (Details)                                 
14: R35         Basis of Condensed Consolidated Financial           HTML     40K 
                Statements (Cash, Cash Equivalents and Restricted                
                Cash) (Details)                                                  
65: R36         Basis of Condensed Consolidated Financial           HTML     44K 
                Statements (AOCI Table) (Details)                                
72: R37         Property and Equipment, Net (Details)               HTML     54K 
45: R38         Goodwill, Net (Details)                             HTML     51K 
11: R39         Other Intangible Assets, Net (Schedule of           HTML     48K 
                Finite-Lived Intangible Assets by Major Class)                   
                (Details)                                                        
33: R40         Other Intangible Assets, Net (Finite Lived          HTML     40K 
                Intangible Asset Future Amortization Expense)                    
                (Details)                                                        
24: R41         Long-Term Debt (Details)                            HTML     85K 
52: R42         Long-Term Debt (Narrative) (Details)                HTML    187K 
75: R43         Leases - Narrative (Details)                        HTML     40K 
34: R44         Leases - Lease Balances (Details)                   HTML     39K 
25: R45         Leases - Lease Cost (Details)                       HTML     59K 
53: R46         Leases - Lease Maturities (Details)                 HTML     64K 
76: R47         Leases - Future Minimum Lease Commitments           HTML     42K 
                (Details)                                                        
35: R48         Operating Revenues - Operating Revenues by          HTML     81K 
                Solution Type (Details)                                          
23: R49         Operating Revenues - Contract Costs (Details)       HTML     36K 
19: R50         Operating Revenues - Contract Liabilities           HTML     36K 
                (Details)                                                        
51: R51         Operating Revenues - Remaining Performance          HTML     37K 
                Obligations (Details)                                            
74: R52         Operating Revenues - Remaining Performance          HTML     28K 
                Obligations Periods (Details)                                    
67: R53         Share-Based Compensation (Narrative) (Details)      HTML     66K 
18: R54         Share-Based Compensation (Restricted Stock Units)   HTML     49K 
                (Details)                                                        
50: R55         Share-Based Compensation (PBRSU Weighted Average    HTML     34K 
                Assumptions) (Details)                                           
73: R56         Share-Based Compensation (Pbrsu) (Details)          HTML     49K 
66: R57         Share-Based Compensation (Options) (Details)        HTML     47K 
20: R58         Share-Based Compensation (Compensation Expense)     HTML     39K 
                (Details)                                                        
49: R59         Litigation and Regulatory Contingencies (Details)   HTML     29K 
78: R60         Income Taxes (Details)                              HTML     39K 
55: R61         Earnings Per Share (Details)                        HTML     95K 
22: R62         Fair Value of Financial Instruments (Fair Value of  HTML     88K 
                Financial Instruments) (Details)                                 
32: R63         Fair Value of Financial Instruments (Non-Recurring  HTML     34K 
                Basis) (Details)                                                 
77: R64         Fair Value of Financial Instruments (Narrative)     HTML     54K 
                (Details)                                                        
54: R65         Acquisitions (Details)                              HTML    149K 
21: R66         Segment Information (Narrative) (Details)           HTML     34K 
31: R67         Segment Information (Financial Information)         HTML     73K 
                (Details)                                                        
16: XML         IDEA XML File -- Filing Summary                      XML    150K 
46: XML         XBRL Instance -- clgx-93019x10q_htm                  XML   3.39M 
13: EXCEL       IDEA Workbook of Financial Reports                  XLSX     98K 
 7: EX-101.CAL  XBRL Calculations -- clgx-20190930_cal               XML    278K 
 8: EX-101.DEF  XBRL Definitions -- clgx-20190930_def                XML    715K 
 9: EX-101.LAB  XBRL Labels -- clgx-20190930_lab                     XML   1.81M 
10: EX-101.PRE  XBRL Presentations -- clgx-20190930_pre              XML   1.15M 
 6: EX-101.SCH  XBRL Schema -- clgx-20190930                         XSD    161K 
42: JSON        XBRL Instance as JSON Data -- MetaLinks              394±   589K 
61: ZIP         XBRL Zipped Folder -- 0000036047-19-000098-xbrl      Zip    318K 


‘10-Q’   —   Quarterly Report


This is an HTML Document rendered as filed.  [ Alternative Formats ]



 iX:   C:   C:   C: 
  Document  
 i P5D i P2D i false i --12-31 i Q3 i 2019 i 0000036047 i false i false i 5742000 i 7394000 i 100000 i 100000 i 100000 i 100000 i 100000 i 600000 i P10Y i 0.00001 i 0.00001 i 180000000 i 180000000 i 80092000 i 79519000 i 80092000 i 79519000 i 0.0755 i P5Y i 0 i 1500000 i 1300000 i 0 i 0.0405 i 0.0405 i 0.0400 i 0.0400 i 0.00001 i 0.00001 i 500000 i 500000 i 0 i 0 i 0 i 0 i 3012000 i 9967000 i 0 i 0 i P3Y i P1Y i P3Y 0000036047 2019-01-01 2019-09-30 0000036047 2019-10-21 0000036047 2019-09-30 0000036047 2018-12-31 0000036047 2019-07-01 2019-09-30 0000036047 2018-07-01 2018-09-30 0000036047 2018-01-01 2018-09-30 0000036047 2018-09-30 0000036047 2017-12-31 0000036047 us-gaap:AdditionalPaidInCapitalMember 2019-07-01 2019-09-30 0000036047 us-gaap:CommonStockMember 2018-06-30 0000036047 us-gaap:CommonStockMember 2019-06-30 0000036047 us-gaap:RetainedEarningsMember 2018-07-01 2018-09-30 0000036047 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2018-09-30 0000036047 us-gaap:CommonStockMember 2018-07-01 2018-09-30 0000036047 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2019-09-30 0000036047 us-gaap:AdditionalPaidInCapitalMember 2019-09-30 0000036047 us-gaap:AdditionalPaidInCapitalMember 2018-07-01 2018-09-30 0000036047 us-gaap:CommonStockMember 2019-07-01 2019-09-30 0000036047 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2019-07-01 2019-09-30 0000036047 us-gaap:CommonStockMember 2019-09-30 0000036047 2019-06-30 0000036047 us-gaap:AdditionalPaidInCapitalMember 2019-06-30 0000036047 us-gaap:RetainedEarningsMember 2019-09-30 0000036047 us-gaap:RetainedEarningsMember 2018-09-30 0000036047 us-gaap:RetainedEarningsMember 2019-07-01 2019-09-30 0000036047 2018-06-30 0000036047 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2018-07-01 2018-09-30 0000036047 us-gaap:AdditionalPaidInCapitalMember 2018-09-30 0000036047 us-gaap:RetainedEarningsMember 2018-06-30 0000036047 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2018-06-30 0000036047 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2019-06-30 0000036047 us-gaap:RetainedEarningsMember 2019-06-30 0000036047 us-gaap:CommonStockMember 2018-09-30 0000036047 us-gaap:AdditionalPaidInCapitalMember 2018-06-30 0000036047 us-gaap:CommonStockMember 2018-12-31 0000036047 us-gaap:AdditionalPaidInCapitalMember 2018-01-01 2018-09-30 0000036047 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2018-12-31 0000036047 us-gaap:AdditionalPaidInCapitalMember 2019-01-01 2019-09-30 0000036047 us-gaap:CommonStockMember 2017-12-31 0000036047 us-gaap:CommonStockMember 2019-01-01 2019-09-30 0000036047 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2018-01-01 2018-09-30 0000036047 us-gaap:RetainedEarningsMember 2018-01-01 2018-09-30 0000036047 us-gaap:RetainedEarningsMember 2017-12-31 0000036047 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2017-12-31 0000036047 us-gaap:CommonStockMember 2018-01-01 2018-09-30 0000036047 us-gaap:AdditionalPaidInCapitalMember 2018-12-31 0000036047 us-gaap:RetainedEarningsMember 2019-01-01 2019-09-30 0000036047 us-gaap:AdditionalPaidInCapitalMember 2017-12-31 0000036047 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2019-01-01 2019-09-30 0000036047 us-gaap:RetainedEarningsMember 2018-12-31 0000036047 clgx:TenLargestClientsMember us-gaap:SalesRevenueNetMember us-gaap:CustomerConcentrationRiskMember 2019-01-01 2019-09-30 0000036047 us-gaap:AccountsPayableAndAccruedLiabilitiesMember 2019-09-30 0000036047 2019-01-01 0000036047 clgx:TenLargestClientsMember us-gaap:SalesRevenueNetMember us-gaap:CustomerConcentrationRiskMember 2019-07-01 2019-09-30 0000036047 clgx:TenLargestClientsMember us-gaap:SalesRevenueNetMember us-gaap:CustomerConcentrationRiskMember 2018-07-01 2018-09-30 0000036047 us-gaap:AccountsPayableAndAccruedLiabilitiesMember 2018-12-31 0000036047 clgx:TenLargestClientsMember us-gaap:SalesRevenueNetMember us-gaap:CustomerConcentrationRiskMember 2018-01-01 2018-09-30 0000036047 srt:MaximumMember 2019-01-01 2019-09-30 0000036047 srt:MinimumMember 2019-01-01 2019-09-30 0000036047 us-gaap:BuildingMember 2018-12-31 0000036047 us-gaap:SoftwareAndSoftwareDevelopmentCostsMember 2018-12-31 0000036047 us-gaap:LeaseholdImprovementsMember 2019-09-30 0000036047 us-gaap:LandMember 2018-12-31 0000036047 us-gaap:ConstructionInProgressMember 2018-12-31 0000036047 us-gaap:LeaseholdImprovementsMember 2018-12-31 0000036047 clgx:FurnitureAndEquipmentMember 2018-12-31 0000036047 us-gaap:BuildingMember 2019-09-30 0000036047 us-gaap:ConstructionInProgressMember 2019-09-30 0000036047 clgx:FurnitureAndEquipmentMember 2019-09-30 0000036047 us-gaap:LandMember 2019-09-30 0000036047 us-gaap:SoftwareAndSoftwareDevelopmentCostsMember 2019-09-30 0000036047 clgx:UWSSegmentMember 2019-01-01 2019-09-30 0000036047 clgx:UWSSegmentMember 2018-12-31 0000036047 clgx:PIRMSegmentMember 2019-01-01 2019-09-30 0000036047 clgx:PIRMSegmentMember 2018-12-31 0000036047 clgx:PIRMSegmentMember 2019-09-30 0000036047 clgx:UWSSegmentMember 2019-09-30 0000036047 us-gaap:NoncompeteAgreementsMember 2018-12-31 0000036047 us-gaap:NoncompeteAgreementsMember 2019-09-30 0000036047 us-gaap:TradeNamesMember 2019-09-30 0000036047 us-gaap:CustomerListsMember 2018-12-31 0000036047 us-gaap:CustomerListsMember 2019-09-30 0000036047 us-gaap:TradeNamesMember 2018-12-31 0000036047 clgx:TermLoanDueMay2024Member clgx:TermLoanFacilityMember 2019-09-30 0000036047 clgx:SeniorDebenturesApril2028Member us-gaap:SeniorNotesMember 2018-12-31 0000036047 clgx:SeniorDebenturesApril2028Member us-gaap:SeniorNotesMember 2019-09-30 0000036047 us-gaap:RevolvingCreditFacilityMember clgx:LineofCreditDueMay2024Member 2019-09-30 0000036047 clgx:TermLoanDueAugust2022Member clgx:TermLoanFacilityMember 2019-09-30 0000036047 us-gaap:RevolvingCreditFacilityMember clgx:LineofCreditDueMay2024Member 2018-12-31 0000036047 clgx:TermLoanDueAugust2022Member clgx:TermLoanFacilityMember 2018-12-31 0000036047 us-gaap:RevolvingCreditFacilityMember clgx:LineOfCreditDueAugust2022Member 2018-12-31 0000036047 clgx:TermLoanDueMay2024Member clgx:TermLoanFacilityMember 2018-12-31 0000036047 clgx:VariousInterestRateLoansMember us-gaap:NotesPayableOtherPayablesMember 2019-09-30 0000036047 us-gaap:RevolvingCreditFacilityMember clgx:LineOfCreditDueAugust2022Member 2019-09-30 0000036047 clgx:VariousInterestRateLoansMember us-gaap:NotesPayableOtherPayablesMember 2018-12-31 0000036047 us-gaap:InterestRateSwapMember us-gaap:ScenarioForecastMember 2022-08-31 0000036047 us-gaap:SwapMember 2018-07-01 2018-09-30 0000036047 srt:MinimumMember clgx:CreditAgreementMember clgx:AdjustedLiboMember 2019-01-01 2019-09-30 0000036047 srt:MaximumMember clgx:CreditAgreementMember clgx:AlternateBaseRateMember 2019-01-01 2019-09-30 0000036047 srt:MaximumMember clgx:CreditAgreementMember clgx:AdjustedLiboMember 2019-01-01 2019-09-30 0000036047 us-gaap:LineOfCreditMember us-gaap:ScenarioForecastMember 2020-09-30 0000036047 us-gaap:InterestRateSwapMember us-gaap:ScenarioForecastMember 2022-09-01 0000036047 2019-04-01 2019-06-30 0000036047 us-gaap:InterestRateSwapMember 2018-12-31 0000036047 clgx:SeniorDebenturesApril2028Member us-gaap:SeniorNotesMember 1998-04-30 0000036047 srt:MaximumMember us-gaap:InterestRateSwapMember 2019-09-30 0000036047 us-gaap:LetterOfCreditMember clgx:LineofCreditDueMay2024Member 2019-09-30 0000036047 2019-05-31 0000036047 srt:MaximumMember clgx:CreditAgreementMember 2019-01-01 2019-09-30 0000036047 us-gaap:LineOfCreditMember us-gaap:ScenarioForecastMember 2021-09-30 0000036047 us-gaap:InterestRateSwapMember us-gaap:ScenarioForecastMember 2025-12-31 0000036047 srt:MinimumMember clgx:CreditAgreementMember 2019-01-01 2019-09-30 0000036047 srt:MinimumMember clgx:CreditAgreementMember clgx:AlternateBaseRateMember 2019-01-01 2019-09-30 0000036047 us-gaap:InterestRateSwapMember 2019-09-30 0000036047 clgx:CreditAgreementMember clgx:AlternateBaseRateMember 2019-01-01 2019-09-30 0000036047 us-gaap:SwapMember 2019-07-01 2019-09-30 0000036047 srt:MinimumMember us-gaap:LineOfCreditMember 2019-09-30 0000036047 clgx:CreditAgreementMember clgx:AdjustedLiboMember 2019-01-01 2019-09-30 0000036047 srt:MinimumMember us-gaap:InterestRateSwapMember 2019-09-30 0000036047 us-gaap:SwapMember 2018-01-01 2018-09-30 0000036047 us-gaap:SwapMember 2019-01-01 2019-09-30 0000036047 us-gaap:InterestRateSwapMember us-gaap:ScenarioForecastMember 2021-10-01 0000036047 us-gaap:InterestRateSwapMember us-gaap:FairValueInputsLevel2Member us-gaap:FairValueMeasurementsRecurringMember 2019-09-30 0000036047 srt:MaximumMember us-gaap:LineOfCreditMember 2019-09-30 0000036047 us-gaap:RevolvingCreditFacilityMember clgx:LineofCreditDueMay2024Member 2019-09-30 0000036047 us-gaap:InterestRateSwapMember us-gaap:ScenarioForecastMember 2021-09-30 0000036047 clgx:TermLoanA1DueMay2024Member clgx:TermLoanFacilityMember 2019-09-30 0000036047 us-gaap:LineOfCreditMember us-gaap:ScenarioForecastMember 2022-09-30 0000036047 clgx:TermLoanA1DueMay2024Member us-gaap:DebtInstrumentRedemptionPeriodOneMember clgx:TermLoanFacilityMember 2019-09-30 2019-09-30 0000036047 clgx:CreditAgreementMember clgx:AdjustedLIBOPlusMember 2019-01-01 2019-09-30 0000036047 clgx:CreditAgreementMember clgx:FederalFundsEffectiveRatePlusMember 2019-01-01 2019-09-30 0000036047 clgx:TermLoanA1DueMay2024Member clgx:TermLoanFacilityMember 2019-01-01 2019-09-30 0000036047 srt:MaximumMember 2019-09-30 0000036047 srt:MinimumMember 2019-09-30 0000036047 us-gaap:SellingGeneralAndAdministrativeExpensesMember 2019-07-01 2019-09-30 0000036047 clgx:CostOfServicesMember 2019-07-01 2019-09-30 0000036047 clgx:CostOfServicesMember 2019-01-01 2019-09-30 0000036047 us-gaap:SellingGeneralAndAdministrativeExpensesMember 2019-01-01 2019-09-30 0000036047 us-gaap:InterestRateSwapMember us-gaap:FairValueMeasurementsRecurringMember 2018-12-31 0000036047 us-gaap:FairValueMeasurementsRecurringMember 2018-12-31 0000036047 us-gaap:FairValueInputsLevel3Member us-gaap:FairValueMeasurementsRecurringMember 2019-09-30 0000036047 us-gaap:FairValueInputsLevel1Member us-gaap:FairValueMeasurementsRecurringMember 2018-12-31 0000036047 us-gaap:InterestRateSwapMember us-gaap:FairValueInputsLevel3Member us-gaap:FairValueMeasurementsRecurringMember 2019-09-30 0000036047 us-gaap:InterestRateSwapMember us-gaap:FairValueInputsLevel1Member us-gaap:FairValueMeasurementsRecurringMember 2019-09-30 0000036047 us-gaap:FairValueInputsLevel1Member us-gaap:FairValueMeasurementsRecurringMember 2019-09-30 0000036047 us-gaap:FairValueInputsLevel2Member us-gaap:FairValueMeasurementsRecurringMember 2019-09-30 0000036047 us-gaap:InterestRateSwapMember us-gaap:FairValueMeasurementsRecurringMember 2019-09-30 0000036047 us-gaap:InterestRateSwapMember us-gaap:FairValueInputsLevel1Member us-gaap:FairValueMeasurementsRecurringMember 2018-12-31 0000036047 us-gaap:InterestRateSwapMember us-gaap:FairValueInputsLevel2Member us-gaap:FairValueMeasurementsRecurringMember 2018-12-31 0000036047 us-gaap:FairValueInputsLevel3Member us-gaap:FairValueMeasurementsRecurringMember 2018-12-31 0000036047 us-gaap:FairValueInputsLevel2Member us-gaap:FairValueMeasurementsRecurringMember 2018-12-31 0000036047 us-gaap:FairValueMeasurementsRecurringMember 2019-09-30 0000036047 us-gaap:InterestRateSwapMember us-gaap:FairValueInputsLevel3Member us-gaap:FairValueMeasurementsRecurringMember 2018-12-31 0000036047 us-gaap:CustomerListsMember 2019-01-01 2019-09-30 0000036047 srt:MaximumMember clgx:MyriadDevelopmentInc.InsignificantAcquisitionMember 2017-12-31 0000036047 srt:MaximumMember clgx:NationalTaxSearchLLCMember 2019-08-06 0000036047 clgx:MyriadDevelopmentInc.InsignificantAcquisitionMember 2017-12-31 0000036047 us-gaap:LicenseMember 2019-01-01 2019-09-30 0000036047 us-gaap:OtherNoncurrentAssetsMember 2019-09-30 0000036047 2020-01-01 2019-09-30 0000036047 2021-01-01 2019-09-30 0000036047 us-gaap:PrepaidExpensesAndOtherCurrentAssetsMember 2019-09-30 0000036047 us-gaap:PrepaidExpensesAndOtherCurrentAssetsMember 2018-12-31 0000036047 2019-10-01 2019-09-30 0000036047 2022-01-01 2019-09-30 0000036047 clgx:PropertyTaxSolutionsMember 2019-09-30 0000036047 us-gaap:OtherNoncurrentAssetsMember 2018-12-31 0000036047 us-gaap:OperatingSegmentsMember clgx:ValuationsSolutionsMember clgx:PIRMSegmentMember 2018-07-01 2018-09-30 0000036047 us-gaap:OperatingSegmentsMember clgx:PropertyInsightsMember clgx:UWSSegmentMember 2018-07-01 2018-09-30 0000036047 clgx:OtherSolutionsMember 2018-01-01 2018-09-30 0000036047 us-gaap:OperatingSegmentsMember clgx:InsuranceAndSpatialSolutionsMember clgx:PIRMSegmentMember 2019-07-01 2019-09-30 0000036047 us-gaap:OperatingSegmentsMember clgx:PropertyInsightsMember clgx:PIRMSegmentMember 2019-07-01 2019-09-30 0000036047 clgx:OtherSolutionsMember 2018-07-01 2018-09-30 0000036047 clgx:InsuranceAndSpatialSolutionsMember 2019-01-01 2019-09-30 0000036047 clgx:CorporateReconcilingItemsAndEliminationsMember clgx:PropertyTaxSolutionsMember 2018-01-01 2018-09-30 0000036047 clgx:FloodDataServicesMember 2018-07-01 2018-09-30 0000036047 clgx:CorporateReconcilingItemsAndEliminationsMember clgx:PropertyInsightsMember 2019-01-01 2019-09-30 0000036047 clgx:ValuationsSolutionsMember 2019-01-01 2019-09-30 0000036047 us-gaap:OperatingSegmentsMember clgx:PropertyTaxSolutionsMember clgx:UWSSegmentMember 2018-01-01 2018-09-30 0000036047 clgx:CorporateReconcilingItemsAndEliminationsMember clgx:OtherSolutionsMember 2018-07-01 2018-09-30 0000036047 clgx:PropertyInsightsMember 2018-01-01 2018-09-30 0000036047 clgx:CorporateReconcilingItemsAndEliminationsMember clgx:CreditSolutionsMember 2018-07-01 2018-09-30 0000036047 us-gaap:OperatingSegmentsMember clgx:PIRMSegmentMember 2018-07-01 2018-09-30 0000036047 us-gaap:OperatingSegmentsMember clgx:UWSSegmentMember 2019-01-01 2019-09-30 0000036047 clgx:PropertyInsightsMember 2018-07-01 2018-09-30 0000036047 clgx:ValuationsSolutionsMember 2018-07-01 2018-09-30 0000036047 us-gaap:OperatingSegmentsMember clgx:PropertyInsightsMember clgx:PIRMSegmentMember 2018-01-01 2018-09-30 0000036047 clgx:FloodDataServicesMember 2019-07-01 2019-09-30 0000036047 clgx:FloodDataServicesMember 2018-01-01 2018-09-30 0000036047 clgx:InsuranceAndSpatialSolutionsMember 2018-01-01 2018-09-30 0000036047 us-gaap:OperatingSegmentsMember clgx:ValuationsSolutionsMember clgx:UWSSegmentMember 2019-07-01 2019-09-30 0000036047 clgx:PropertyInsightsMember 2019-01-01 2019-09-30 0000036047 clgx:CreditSolutionsMember 2018-07-01 2018-09-30 0000036047 clgx:CorporateReconcilingItemsAndEliminationsMember clgx:PropertyTaxSolutionsMember 2018-07-01 2018-09-30 0000036047 us-gaap:OperatingSegmentsMember clgx:PIRMSegmentMember 2018-01-01 2018-09-30 0000036047 us-gaap:OperatingSegmentsMember clgx:ValuationsSolutionsMember clgx:UWSSegmentMember 2018-01-01 2018-09-30 0000036047 clgx:CorporateReconcilingItemsAndEliminationsMember clgx:ValuationsSolutionsMember 2018-01-01 2018-09-30 0000036047 clgx:CorporateReconcilingItemsAndEliminationsMember clgx:InsuranceAndSpatialSolutionsMember 2018-01-01 2018-09-30 0000036047 clgx:InsuranceAndSpatialSolutionsMember 2019-07-01 2019-09-30 0000036047 us-gaap:OperatingSegmentsMember clgx:OtherSolutionsMember clgx:UWSSegmentMember 2019-01-01 2019-09-30 0000036047 clgx:PropertyTaxSolutionsMember 2019-07-01 2019-09-30 0000036047 us-gaap:OperatingSegmentsMember clgx:PropertyTaxSolutionsMember clgx:UWSSegmentMember 2018-07-01 2018-09-30 0000036047 us-gaap:OperatingSegmentsMember clgx:CreditSolutionsMember clgx:UWSSegmentMember 2019-07-01 2019-09-30 0000036047 clgx:PropertyTaxSolutionsMember 2019-01-01 2019-09-30 0000036047 us-gaap:OperatingSegmentsMember clgx:PropertyInsightsMember clgx:UWSSegmentMember 2018-01-01 2018-09-30 0000036047 us-gaap:OperatingSegmentsMember clgx:InsuranceAndSpatialSolutionsMember clgx:PIRMSegmentMember 2018-01-01 2018-09-30 0000036047 clgx:PropertyInsightsMember 2019-07-01 2019-09-30 0000036047 clgx:CorporateReconcilingItemsAndEliminationsMember clgx:InsuranceAndSpatialSolutionsMember 2018-07-01 2018-09-30 0000036047 us-gaap:OperatingSegmentsMember clgx:FloodDataServicesMember clgx:PIRMSegmentMember 2018-07-01 2018-09-30 0000036047 us-gaap:OperatingSegmentsMember clgx:OtherSolutionsMember clgx:UWSSegmentMember 2018-07-01 2018-09-30 0000036047 us-gaap:OperatingSegmentsMember clgx:PropertyInsightsMember clgx:PIRMSegmentMember 2018-07-01 2018-09-30 0000036047 clgx:CorporateReconcilingItemsAndEliminationsMember clgx:ValuationsSolutionsMember 2018-07-01 2018-09-30 0000036047 us-gaap:OperatingSegmentsMember clgx:InsuranceAndSpatialSolutionsMember clgx:UWSSegmentMember 2018-07-01 2018-09-30 0000036047 us-gaap:OperatingSegmentsMember clgx:ValuationsSolutionsMember clgx:UWSSegmentMember 2018-07-01 2018-09-30 0000036047 us-gaap:OperatingSegmentsMember clgx:OtherSolutionsMember clgx:PIRMSegmentMember 2019-07-01 2019-09-30 0000036047 clgx:CorporateReconcilingItemsAndEliminationsMember clgx:FloodDataServicesMember 2018-07-01 2018-09-30 0000036047 us-gaap:OperatingSegmentsMember clgx:InsuranceAndSpatialSolutionsMember clgx:UWSSegmentMember 2018-01-01 2018-09-30 0000036047 clgx:CorporateReconcilingItemsAndEliminationsMember clgx:PropertyTaxSolutionsMember 2019-01-01 2019-09-30 0000036047 us-gaap:OperatingSegmentsMember clgx:PropertyTaxSolutionsMember clgx:PIRMSegmentMember 2018-01-01 2018-09-30 0000036047 clgx:ValuationsSolutionsMember 2018-01-01 2018-09-30 0000036047 clgx:CreditSolutionsMember 2019-07-01 2019-09-30 0000036047 clgx:PropertyTaxSolutionsMember 2018-07-01 2018-09-30 0000036047 us-gaap:OperatingSegmentsMember clgx:ValuationsSolutionsMember clgx:UWSSegmentMember 2019-01-01 2019-09-30 0000036047 us-gaap:OperatingSegmentsMember clgx:FloodDataServicesMember clgx:PIRMSegmentMember 2019-07-01 2019-09-30 0000036047 us-gaap:OperatingSegmentsMember clgx:FloodDataServicesMember clgx:PIRMSegmentMember 2018-01-01 2018-09-30 0000036047 us-gaap:OperatingSegmentsMember clgx:OtherSolutionsMember clgx:UWSSegmentMember 2018-01-01 2018-09-30 0000036047 clgx:CorporateReconcilingItemsAndEliminationsMember clgx:FloodDataServicesMember 2018-01-01 2018-09-30 0000036047 clgx:CorporateReconcilingItemsAndEliminationsMember clgx:PropertyTaxSolutionsMember 2019-07-01 2019-09-30 0000036047 us-gaap:OperatingSegmentsMember clgx:PropertyInsightsMember clgx:UWSSegmentMember 2019-07-01 2019-09-30 0000036047 clgx:CorporateReconcilingItemsAndEliminationsMember clgx:PropertyInsightsMember 2018-01-01 2018-09-30 0000036047 us-gaap:OperatingSegmentsMember clgx:FloodDataServicesMember clgx:UWSSegmentMember 2019-07-01 2019-09-30 0000036047 us-gaap:OperatingSegmentsMember clgx:PIRMSegmentMember 2019-01-01 2019-09-30 0000036047 clgx:CorporateReconcilingItemsAndEliminationsMember clgx:CreditSolutionsMember 2019-01-01 2019-09-30 0000036047 clgx:CorporateReconcilingItemsAndEliminationsMember clgx:OtherSolutionsMember 2019-01-01 2019-09-30 0000036047 us-gaap:OperatingSegmentsMember clgx:ValuationsSolutionsMember clgx:PIRMSegmentMember 2018-01-01 2018-09-30 0000036047 us-gaap:OperatingSegmentsMember clgx:CreditSolutionsMember clgx:UWSSegmentMember 2018-01-01 2018-09-30 0000036047 clgx:CorporateReconcilingItemsAndEliminationsMember 2019-01-01 2019-09-30 0000036047 us-gaap:OperatingSegmentsMember clgx:ValuationsSolutionsMember clgx:PIRMSegmentMember 2019-07-01 2019-09-30 0000036047 us-gaap:OperatingSegmentsMember clgx:OtherSolutionsMember clgx:PIRMSegmentMember 2018-07-01 2018-09-30 0000036047 us-gaap:OperatingSegmentsMember clgx:OtherSolutionsMember clgx:PIRMSegmentMember 2018-01-01 2018-09-30 0000036047 clgx:CorporateReconcilingItemsAndEliminationsMember 2018-01-01 2018-09-30 0000036047 clgx:CorporateReconcilingItemsAndEliminationsMember clgx:PropertyInsightsMember 2018-07-01 2018-09-30 0000036047 us-gaap:OperatingSegmentsMember clgx:ValuationsSolutionsMember clgx:PIRMSegmentMember 2019-01-01 2019-09-30 0000036047 us-gaap:OperatingSegmentsMember clgx:FloodDataServicesMember clgx:PIRMSegmentMember 2019-01-01 2019-09-30 0000036047 us-gaap:OperatingSegmentsMember clgx:FloodDataServicesMember clgx:UWSSegmentMember 2019-01-01 2019-09-30 0000036047 clgx:CorporateReconcilingItemsAndEliminationsMember clgx:CreditSolutionsMember 2018-01-01 2018-09-30 0000036047 us-gaap:OperatingSegmentsMember clgx:InsuranceAndSpatialSolutionsMember clgx:UWSSegmentMember 2019-01-01 2019-09-30 0000036047 us-gaap:OperatingSegmentsMember clgx:FloodDataServicesMember clgx:UWSSegmentMember 2018-07-01 2018-09-30 0000036047 us-gaap:OperatingSegmentsMember clgx:InsuranceAndSpatialSolutionsMember clgx:UWSSegmentMember 2019-07-01 2019-09-30 0000036047 us-gaap:OperatingSegmentsMember clgx:PropertyInsightsMember clgx:PIRMSegmentMember 2019-01-01 2019-09-30 0000036047 us-gaap:OperatingSegmentsMember clgx:PropertyTaxSolutionsMember clgx:PIRMSegmentMember 2018-07-01 2018-09-30 0000036047 us-gaap:OperatingSegmentsMember clgx:FloodDataServicesMember clgx:UWSSegmentMember 2018-01-01 2018-09-30 0000036047 clgx:CreditSolutionsMember 2018-01-01 2018-09-30 0000036047 us-gaap:OperatingSegmentsMember clgx:PropertyTaxSolutionsMember clgx:UWSSegmentMember 2019-07-01 2019-09-30 0000036047 us-gaap:OperatingSegmentsMember clgx:InsuranceAndSpatialSolutionsMember clgx:PIRMSegmentMember 2018-07-01 2018-09-30 0000036047 clgx:InsuranceAndSpatialSolutionsMember 2018-07-01 2018-09-30 0000036047 us-gaap:OperatingSegmentsMember clgx:CreditSolutionsMember clgx:UWSSegmentMember 2019-01-01 2019-09-30 0000036047 us-gaap:OperatingSegmentsMember clgx:OtherSolutionsMember clgx:UWSSegmentMember 2019-07-01 2019-09-30 0000036047 clgx:OtherSolutionsMember 2019-07-01 2019-09-30 0000036047 clgx:PropertyTaxSolutionsMember 2018-01-01 2018-09-30 0000036047 clgx:CorporateReconcilingItemsAndEliminationsMember clgx:InsuranceAndSpatialSolutionsMember 2019-01-01 2019-09-30 0000036047 clgx:ValuationsSolutionsMember 2019-07-01 2019-09-30 0000036047 us-gaap:OperatingSegmentsMember clgx:CreditSolutionsMember clgx:PIRMSegmentMember 2018-01-01 2018-09-30 0000036047 clgx:FloodDataServicesMember 2019-01-01 2019-09-30 0000036047 clgx:CorporateReconcilingItemsAndEliminationsMember 2019-07-01 2019-09-30 0000036047 clgx:CreditSolutionsMember 2019-01-01 2019-09-30 0000036047 clgx:CorporateReconcilingItemsAndEliminationsMember clgx:ValuationsSolutionsMember 2019-07-01 2019-09-30 0000036047 clgx:CorporateReconcilingItemsAndEliminationsMember clgx:ValuationsSolutionsMember 2019-01-01 2019-09-30 0000036047 us-gaap:OperatingSegmentsMember clgx:PropertyInsightsMember clgx:UWSSegmentMember 2019-01-01 2019-09-30 0000036047 us-gaap:OperatingSegmentsMember clgx:CreditSolutionsMember clgx:UWSSegmentMember 2018-07-01 2018-09-30 0000036047 clgx:CorporateReconcilingItemsAndEliminationsMember clgx:OtherSolutionsMember 2019-07-01 2019-09-30 0000036047 us-gaap:OperatingSegmentsMember clgx:CreditSolutionsMember clgx:PIRMSegmentMember 2019-07-01 2019-09-30 0000036047 clgx:CorporateReconcilingItemsAndEliminationsMember clgx:FloodDataServicesMember 2019-01-01 2019-09-30 0000036047 us-gaap:OperatingSegmentsMember clgx:PIRMSegmentMember 2019-07-01 2019-09-30 0000036047 us-gaap:OperatingSegmentsMember clgx:UWSSegmentMember 2018-07-01 2018-09-30 0000036047 us-gaap:OperatingSegmentsMember clgx:CreditSolutionsMember clgx:PIRMSegmentMember 2019-01-01 2019-09-30 0000036047 us-gaap:OperatingSegmentsMember clgx:OtherSolutionsMember clgx:PIRMSegmentMember 2019-01-01 2019-09-30 0000036047 clgx:OtherSolutionsMember 2019-01-01 2019-09-30 0000036047 clgx:CorporateReconcilingItemsAndEliminationsMember clgx:CreditSolutionsMember 2019-07-01 2019-09-30 0000036047 clgx:CorporateReconcilingItemsAndEliminationsMember clgx:OtherSolutionsMember 2018-01-01 2018-09-30 0000036047 us-gaap:OperatingSegmentsMember clgx:PropertyTaxSolutionsMember clgx:PIRMSegmentMember 2019-01-01 2019-09-30 0000036047 us-gaap:OperatingSegmentsMember clgx:InsuranceAndSpatialSolutionsMember clgx:PIRMSegmentMember 2019-01-01 2019-09-30 0000036047 us-gaap:OperatingSegmentsMember clgx:PropertyTaxSolutionsMember clgx:UWSSegmentMember 2019-01-01 2019-09-30 0000036047 us-gaap:OperatingSegmentsMember clgx:UWSSegmentMember 2018-01-01 2018-09-30 0000036047 us-gaap:OperatingSegmentsMember clgx:PropertyTaxSolutionsMember clgx:PIRMSegmentMember 2019-07-01 2019-09-30 0000036047 us-gaap:OperatingSegmentsMember clgx:UWSSegmentMember 2019-07-01 2019-09-30 0000036047 clgx:CorporateReconcilingItemsAndEliminationsMember 2018-07-01 2018-09-30 0000036047 us-gaap:OperatingSegmentsMember clgx:CreditSolutionsMember clgx:PIRMSegmentMember 2018-07-01 2018-09-30 0000036047 clgx:CorporateReconcilingItemsAndEliminationsMember clgx:PropertyInsightsMember 2019-07-01 2019-09-30 0000036047 clgx:CorporateReconcilingItemsAndEliminationsMember clgx:InsuranceAndSpatialSolutionsMember 2019-07-01 2019-09-30 0000036047 clgx:CorporateReconcilingItemsAndEliminationsMember clgx:FloodDataServicesMember 2019-07-01 2019-09-30 0000036047 us-gaap:RestrictedStockUnitsRSUMember 2019-01-01 2019-09-30 0000036047 us-gaap:RestrictedStockUnitsRSUMember 2018-12-31 0000036047 us-gaap:RestrictedStockUnitsRSUMember 2019-09-30 0000036047 us-gaap:EmployeeStockOptionMember 2019-09-30 0000036047 us-gaap:EmployeeStockOptionMember 2019-01-01 2019-09-30 0000036047 us-gaap:EmployeeStockOptionMember 2018-12-31 0000036047 clgx:PbrsuMember 2019-01-01 2019-09-30 0000036047 clgx:PbrsuMember 2018-12-31 0000036047 clgx:PbrsuMember 2019-09-30 0000036047 us-gaap:EmployeeStockOptionMember 2018-07-01 2018-09-30 0000036047 us-gaap:EmployeeStockMember 2018-07-01 2018-09-30 0000036047 us-gaap:EmployeeStockOptionMember 2018-01-01 2018-09-30 0000036047 clgx:PbrsuMember 2018-01-01 2018-09-30 0000036047 us-gaap:EmployeeStockMember 2018-01-01 2018-09-30 0000036047 us-gaap:EmployeeStockMember 2019-07-01 2019-09-30 0000036047 us-gaap:RestrictedStockUnitsRSUMember 2019-07-01 2019-09-30 0000036047 clgx:PbrsuMember 2018-07-01 2018-09-30 0000036047 us-gaap:RestrictedStockUnitsRSUMember 2018-01-01 2018-09-30 0000036047 us-gaap:EmployeeStockOptionMember 2019-07-01 2019-09-30 0000036047 us-gaap:EmployeeStockMember 2019-01-01 2019-09-30 0000036047 clgx:PbrsuMember 2019-07-01 2019-09-30 0000036047 us-gaap:RestrictedStockUnitsRSUMember 2018-07-01 2018-09-30 0000036047 clgx:CoreLogic2018PerformanceIncentivePlanMember 2018-05-01 0000036047 clgx:CostOfServicesMember 2018-01-01 2018-09-30 0000036047 clgx:PerformanceBasedRestrictedStockUnitsWithoutMarketbasedConditionMember 2018-01-01 2018-09-30 0000036047 clgx:CostOfServicesMember 2018-07-01 2018-09-30 0000036047 clgx:FairCreditReportingActClassActionMember 2019-07-29 2019-07-29 0000036047 us-gaap:ScenarioForecastMember 2019-10-01 2020-09-30 0000036047 us-gaap:RestrictedStockUnitsRSUMember 2019-07-01 2019-09-30 0000036047 us-gaap:RestrictedStockUnitsRSUMember 2018-07-01 2018-09-30 0000036047 clgx:PbrsuMember 2018-01-01 2018-09-30 0000036047 us-gaap:RestrictedStockUnitsRSUMember 2019-01-01 2019-09-30 0000036047 us-gaap:RestrictedStockUnitsRSUMember 2018-01-01 2018-09-30 0000036047 clgx:PbrsuMember 2019-01-01 2019-09-30 0000036047 clgx:SymbilityMember 2018-12-01 2018-12-31 0000036047 clgx:HomeVisitMember us-gaap:CustomerListsMember 2019-09-30 0000036047 clgx:SymbilityMember clgx:PIRMSegmentMember 2019-01-01 2019-09-30 0000036047 clgx:HomeVisitMember 2019-01-01 2019-09-30 0000036047 clgx:ETechMember us-gaap:CustomerListsMember 2018-02-01 2018-02-28 0000036047 clgx:SymbilityMember us-gaap:CustomerListsMember 2019-01-01 2019-09-30 0000036047 clgx:AlamodeMember us-gaap:CustomerListsMember 2019-01-01 2019-09-30 0000036047 clgx:SymbilityMember us-gaap:TechnologyBasedIntangibleAssetsMember 2019-01-01 2019-09-30 0000036047 clgx:SymbilityMember 2018-12-18 0000036047 clgx:AlamodeMember clgx:UWSSegmentMember 2019-01-01 2019-09-30 0000036047 clgx:AlamodeMember us-gaap:TradeNamesMember 2019-01-01 2019-09-30 0000036047 clgx:NationalTaxSearchLLCMember 2019-08-01 2019-08-31 0000036047 clgx:AlamodeMember us-gaap:TechnologyBasedIntangibleAssetsMember 2019-01-01 2019-09-30 0000036047 clgx:HomeVisitMember us-gaap:CustomerListsMember 2019-01-01 2019-09-30 0000036047 clgx:SymbilityMember 2019-01-01 2019-09-30 0000036047 clgx:HomeVisitMember us-gaap:NoncompeteAgreementsMember 2019-01-01 2019-09-30 0000036047 clgx:ETechMember us-gaap:TechnologyBasedIntangibleAssetsMember 2018-02-28 0000036047 clgx:NationalTaxSearchLLCMember us-gaap:NoncompeteAgreementsMember 2019-08-31 0000036047 clgx:AlamodeMember us-gaap:CustomerListsMember 2019-09-30 0000036047 clgx:SymbilityMember us-gaap:TrademarksMember 2019-09-30 0000036047 clgx:ETechMember clgx:PIRMSegmentMember 2018-02-01 2018-02-28 0000036047 clgx:ETechMember us-gaap:CustomerListsMember 2018-02-28 0000036047 clgx:AlamodeMember 2019-09-30 0000036047 clgx:SymbilityMember 2019-09-30 0000036047 clgx:HomeVisitMember 2018-12-01 2018-12-31 0000036047 clgx:NationalTaxSearchLLCMember us-gaap:TrademarksMember 2019-08-31 0000036047 clgx:AlamodeMember us-gaap:NoncompeteAgreementsMember 2019-01-01 2019-09-30 0000036047 clgx:NationalTaxSearchLLCMember us-gaap:TrademarksMember 2019-08-01 2019-08-31 0000036047 clgx:AlamodeMember us-gaap:TechnologyBasedIntangibleAssetsMember 2019-09-30 0000036047 clgx:HomeVisitMember us-gaap:TrademarksMember 2019-09-30 0000036047 clgx:HomeVisitMember clgx:PIRMSegmentMember 2019-01-01 2019-09-30 0000036047 clgx:SymbilityMember us-gaap:TrademarksMember 2019-01-01 2019-09-30 0000036047 clgx:NationalTaxSearchLLCMember us-gaap:CustomerListsMember 2019-08-31 0000036047 clgx:AlamodeMember us-gaap:NoncompeteAgreementsMember 2019-09-30 0000036047 clgx:SymbilityMember us-gaap:TechnologyBasedIntangibleAssetsMember 2019-09-30 0000036047 clgx:HomeVisitMember us-gaap:TrademarksMember 2019-01-01 2019-09-30 0000036047 clgx:SymbilityMember us-gaap:CustomerListsMember 2019-09-30 0000036047 clgx:ETechMember 2018-02-28 0000036047 clgx:NationalTaxSearchLLCMember us-gaap:NoncompeteAgreementsMember 2019-08-01 2019-08-31 0000036047 clgx:NationalTaxSearchLLCMember 2019-08-31 0000036047 clgx:ETechMember 2018-02-01 2018-02-28 0000036047 clgx:NationalTaxSearchLLCMember us-gaap:TechnologyBasedIntangibleAssetsMember 2019-08-31 0000036047 clgx:NationalTaxSearchLLCMember us-gaap:CustomerListsMember 2019-08-01 2019-08-31 0000036047 clgx:AlamodeMember us-gaap:TradeNamesMember 2019-09-30 0000036047 clgx:SymbilityMember 2018-12-17 0000036047 clgx:NationalTaxSearchLLCMember us-gaap:TechnologyBasedIntangibleAssetsMember 2019-08-01 2019-08-31 0000036047 clgx:HomeVisitMember us-gaap:NoncompeteAgreementsMember 2019-09-30 0000036047 clgx:ETechMember us-gaap:TechnologyBasedIntangibleAssetsMember 2018-02-01 2018-02-28 0000036047 clgx:AlamodeMember 2018-04-01 2018-04-30 0000036047 clgx:PIRMSegmentMember 2018-07-01 2018-09-30 0000036047 clgx:PIRMSegmentMember 2018-01-01 2018-09-30 0000036047 clgx:UWSSegmentMember 2019-07-01 2019-09-30 0000036047 clgx:PIRMSegmentMember 2019-07-01 2019-09-30 0000036047 clgx:UWSSegmentMember 2018-07-01 2018-09-30 0000036047 clgx:UWSSegmentMember 2018-01-01 2018-09-30 0000036047 us-gaap:OperatingSegmentsMember clgx:PIRMSegmentMember 2019-09-30 0000036047 us-gaap:CorporateNonSegmentMember 2019-09-30 0000036047 us-gaap:OperatingSegmentsMember clgx:PIRMSegmentMember 2018-12-31 0000036047 us-gaap:CorporateNonSegmentMember 2018-12-31 0000036047 us-gaap:OperatingSegmentsMember clgx:UWSSegmentMember 2018-12-31 0000036047 us-gaap:OperatingSegmentsMember clgx:UWSSegmentMember 2019-09-30 0000036047 us-gaap:IntersegmentEliminationMember 2018-12-31 0000036047 us-gaap:IntersegmentEliminationMember 2019-09-30 0000036047 us-gaap:IntersegmentEliminationMember 2019-07-01 2019-09-30 0000036047 us-gaap:CorporateNonSegmentMember 2019-01-01 2019-09-30 0000036047 us-gaap:CorporateNonSegmentMember 2019-07-01 2019-09-30 0000036047 us-gaap:IntersegmentEliminationMember 2019-01-01 2019-09-30 0000036047 us-gaap:IntersegmentEliminationMember 2018-07-01 2018-09-30 0000036047 us-gaap:CorporateNonSegmentMember 2018-01-01 2018-09-30 0000036047 us-gaap:CorporateNonSegmentMember 2018-07-01 2018-09-30 0000036047 us-gaap:IntersegmentEliminationMember 2018-01-01 2018-09-30 xbrli:shares iso4217:USD clgx:lease xbrli:pure iso4217:USD xbrli:shares iso4217:CAD clgx:segment clgx:consumer iso4217:GBP


 

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 
FORM  i 10-Q
  
 i           QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended  i September 30, 2019

OR

 i            TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from              to

Commission file number  i 001-13585
cllogovcmyk20printjpg003.jpg
 i CORELOGIC, INC.
(Exact name of registrant as specified in its charter)
 
 
 i Delaware
 i 95-1068610
 
 
(State or other jurisdiction of incorporation or organization)
(I.R.S. Employer Identification No.)
 
 
 
 i 40 Pacifica
 i Irvine
 i California
 i 92618
 
 
(Street Address)
(City)
(State)
(Zip Code)
 
 
( i 949)  i 214-1000
(Registrant’s telephone number, including area code)
 
Not Applicable
(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class:
Trading symbol(s)
Name of exchange on which registered
 i Common Stock, $0.00001 par value
 i CLGX
 i New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.     i Yes      No   
 
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
 i Yes       No   
 
Indicate by check mark whether the registrant: is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
 
 i Large accelerated filer
 
Accelerated filer
Non-accelerated filer
 
Smaller reporting company
 i 
 
 
 
Emerging growth company
 i 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes   i     No   

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

On October 21, 2019 there were  i 79,518,536 shares of common stock outstanding.




CoreLogic, Inc.
Table of Contents
 
 
Part I:
Financial Information
 
 
 
Item 1.
Financial Statements (unaudited)
 
 
 
 
 
A. Condensed Consolidated Balance Sheets as of September 30, 2019 and December 31, 2018
 
 
 
 
B. Condensed Consolidated Statements of Operations for the three and nine months ended September 30, 2019 and 2018
 
 
 
 
C. Condensed Consolidated Statements of Comprehensive Income for the three and nine months ended September 30, 2019 and 2018
 
 
 
 
D. Condensed Consolidated Statements of Cash Flows for the nine months ended September 30, 2019 and 2018
 
 
 
 
E. Condensed Consolidated Statement of Stockholders' Equity for the three and nine months ended September 30, 2019 and 2018
 
 
 
 
F. Notes to Condensed Consolidated Financial Statements
 
 
 
Item 2.
Management's Discussion and Analysis of Financial Condition and Results of Operations
 
 
 
Item 3.
Quantitative and Qualitative Disclosures About Market Risk
 
 
 
Item 4.
Controls and Procedures
 
 
 
Part II:
Other Information
 
 
 
Item 1.
Legal Proceedings
 
 
 
Item 1A.
Risk Factors
 
 
 
Item 2.
Unregistered Sales of Equity Securities and Use of Proceeds
 
 
 
Item 6.
Exhibits





PART I: FINANCIAL INFORMATION
Item 1.  Financial Statements.

CoreLogic, Inc.
Condensed Consolidated Balance Sheets
(Unaudited) 
(in thousands, except par value)
September 30,

December 31,
Assets
2019

2018
Current assets:
 
 
 
Cash and cash equivalents
$
 i 88,238

 
$
 i 85,271

Accounts receivable (less allowance for doubtful accounts of $7,394 and $5,742 as of September 30, 2019 and December 31, 2018, respectively)
 i 273,021

 
 i 242,814

Prepaid expenses and other current assets
 i 60,328

 
 i 50,136

Income tax receivable
 i 2,673

 
 i 25,299

Total current assets
 i 424,260

 
 i 403,520

Property and equipment, net
 i 446,057

 
 i 456,497

Operating lease assets
 i 65,302

 
 i 

Goodwill, net
 i 2,392,972

 
 i 2,391,954

Other intangible assets, net
 i 391,994

 
 i 468,405

Capitalized data and database costs, net
 i 323,777

 
 i 324,049

Investment in affiliates, net
 i 18,575

 
 i 22,429

Other assets
 i 75,518

 
 i 102,136

Total assets
$
 i 4,138,455

 
$
 i 4,168,990

Liabilities and Equity
 

 
 

Current liabilities:
 

 
 

Accounts payable and other accrued expenses
$
 i 179,740

 
$
 i 166,258

Accrued salaries and benefits
 i 80,570

 
 i 84,940

Contract liabilities, current
 i 314,847

 
 i 308,959

Current portion of long-term debt
 i 68,247

 
 i 26,935

Operating lease liabilities, current
 i 16,839

 
 i 

Total current liabilities
 i 660,243

 
 i 587,092

Long-term debt, net of current
 i 1,636,272

 
 i 1,752,241

Contract liabilities, net of current
 i 539,037

 
 i 524,069

Deferred income tax liabilities
 i 100,229

 
 i 124,968

Operating lease liabilities, net of current
 i 85,844

 
 i 

Other liabilities
 i 183,969

 
 i 180,122

Total liabilities
 i 3,205,594

 
 i 3,168,492




 


Stockholders' equity:
 

 
 

Preferred stock, $0.00001 par value; 500 shares authorized, no shares issued or outstanding
 i 

 
 i 

Common stock, $0.00001 par value; 180,000 shares authorized; 79,519 and 80,092 shares issued and outstanding as of September 30, 2019 and December 31, 2018, respectively
 i 1

 
 i 1

Additional paid-in capital
 i 124,872

 
 i 160,870

Retained earnings
 i 994,673

 
 i 975,375

Accumulated other comprehensive loss
( i 186,685
)
 
( i 135,748
)
Total stockholders' equity
 i 932,861

 
 i 1,000,498

Total liabilities and equity
$
 i 4,138,455

 
$
 i 4,168,990

 
The accompanying notes are an integral part of these condensed consolidated financial statements.

1



CoreLogic, Inc.
Condensed Consolidated Statements of Operations
(Unaudited)
 
For the Three Months Ended
 
For the Nine Months Ended
 
September 30,
 
September 30,
(in thousands, except per share amounts)
2019

2018
 
2019
 
2018
Operating revenues
$
 i 458,957

 
$
 i 451,768

 
$
 i 1,336,203

 
$
 i 1,385,069

Cost of services (excluding depreciation and amortization shown below)
 i 228,186

 
 i 230,419

 
 i 674,457

 
 i 709,154

Selling, general and administrative expenses
 i 111,276

 
 i 113,075

 
 i 362,298

 
 i 340,049

Depreciation and amortization
 i 45,717

 
 i 48,461

 
 i 142,042

 
 i 141,948

Impairment loss
 i 78

 
 i 33

 
 i 47,912

 
 i 82

Total operating expenses
 i 385,257


 i 391,988

 
 i 1,226,709

 
 i 1,191,233

Operating income
 i 73,700


 i 59,780

 
 i 109,494

 
 i 193,836

Interest expense:
 


 

 
 

 
 

Interest income
 i 349

 
 i 299

 
 i 1,728

 
 i 1,053

Interest expense
 i 19,852

 
 i 19,382

 
 i 59,137

 
 i 56,061

Total interest expense, net
( i 19,503
)

( i 19,083
)
 
( i 57,409
)
 
( i 55,008
)
Gain/(loss) on investments and other, net
 i 224

 
 i 2,835

 
( i 1,926
)
 
 i 5,124

Tax indemnification release
 i 

 
 i 

 
( i 13,394
)
 
 i 

Income from continuing operations before equity in earnings/(losses) of affiliates and income taxes
 i 54,421


 i 43,532

 
 i 36,765

 
 i 143,952

Provision for income taxes
 i 14,481

 
 i 20,836

 
 i 508

 
 i 37,432

Income from continuing operations before equity in earnings/(losses) of affiliates
 i 39,940


 i 22,696

 
 i 36,257

 
 i 106,520

Equity in earnings/(losses) of affiliates, net of tax
 i 605

 
( i 161
)
 
 i 497


 i 2,909

Net income from continuing operations
 i 40,545


 i 22,535

 
 i 36,754

 
 i 109,429

Loss from discontinued operations, net of tax
( i 17,362
)
 
( i 84
)
 
( i 17,456
)
 
( i 175
)
Net income
$
 i 23,183


$
 i 22,451

 
$
 i 19,298

 
$
 i 109,254



 

 

 

Basic income per share:





 


 


Net income from continuing operations
$
 i 0.51


$
 i 0.28

 
$
 i 0.46

 
$
 i 1.35

Loss from discontinued operations, net of tax
( i 0.22
)

 i 

 
( i 0.22
)
 
 i 

Net income
$
 i 0.29

 
$
 i 0.28

 
$
 i 0.24

 
$
 i 1.35

Diluted income per share:
 


 

 
 

 
 

Net income from continuing operations
$
 i 0.50


$
 i 0.27

 
$
 i 0.45

 
$
 i 1.33

Loss from discontinued operations, net of tax
( i 0.21
)

 i 

 
( i 0.21
)
 
 i 

Net income
$
 i 0.29

 
$
 i 0.27

 
$
 i 0.24

 
$
 i 1.33

Weighted-average common shares outstanding:
 


 

 
 

 
 

Basic
 i 79,761


 i 80,680

 
 i 80,138

 
 i 81,073

Diluted
 i 80,914


 i 82,017

 
 i 81,205

 
 i 82,528


The accompanying notes are an integral part of these condensed consolidated financial statements.

2



CoreLogic, Inc.
Condensed Consolidated Statements of Comprehensive Income
(Unaudited)

 
For the Three Months Ended
 
For the Nine Months Ended
 
September 30,
 
September 30,
(in thousands)
2019
 
2018
 
2019
 
2018
Net income
$
 i 23,183

 
$
 i 22,451

 
$
 i 19,298

 
$
 i 109,254

Other comprehensive loss
 

 
 

 
 

 
 

Adoption of new accounting standards
 i 

 
 i 

 
 i 

 
 i 408

Market value adjustments on interest rate swaps, net of tax
( i 8,121
)
 
 i 2,532

 
( i 41,415
)
 
 i 10,770

Reclassification adjustment for gain on terminated interest rate swap included in net income
 i 

 
 i 

 
( i 67
)
 
 i 

Foreign currency translation adjustments
( i 13,529
)
 
( i 6,129
)
 
( i 9,007
)
 
( i 23,729
)
Supplemental benefit plans adjustments, net of tax
( i 149
)
 
( i 124
)
 
( i 448
)
 
( i 371
)
Total other comprehensive loss
( i 21,799
)
 
( i 3,721
)
 
( i 50,937
)
 
( i 12,922
)
Comprehensive income/(loss)
$
 i 1,384

 
$
 i 18,730

 
$
( i 31,639
)
 
$
 i 96,332

 
The accompanying notes are an integral part of these condensed consolidated financial statements.

3



CoreLogic, Inc.
Condensed Consolidated Statements of Cash Flows
(Unaudited)

For the Nine Months Ended

September 30,
(in thousands)
2019

2018
Cash flows from operating activities:
 

 
Net income
$
 i 19,298


$
 i 109,254

Less: Loss from discontinued operations, net of tax
( i 17,456
)

( i 175
)
Net income from continuing operations
 i 36,754


 i 109,429

Adjustments to reconcile net income from continuing operations to net cash provided by operating activities:
 


 

Depreciation and amortization
 i 142,042


 i 141,948

Amortization of debt issuance costs
 i 3,836


 i 4,103

Amortization of operating lease assets
 i 11,675

 
 i 

Impairment loss
 i 47,912


 i 82

Provision for bad debt and claim losses
 i 11,546


 i 11,113

Share-based compensation
 i 26,863


 i 29,574

Equity in earnings of affiliates, net of taxes
( i 497
)

( i 2,909
)
Gain on sale of property and equipment
( i 3
)

( i 19
)
Loss on early extinguishment of debt
 i 1,453


 i 

Deferred income tax
( i 10,642
)

 i 10,279

Loss/(gain) on investments and other, net
 i 473


( i 5,124
)
Tax indemnification release
 i 13,394

 
 i 

Change in operating assets and liabilities, net of acquisitions:
 


 

Accounts receivable
( i 33,071
)

 i 2,619

Prepaid expenses and other current assets
( i 7,132
)

( i 7,617
)
Accounts payable and other accrued expenses
( i 18,023
)

( i 22,037
)
Contract liabilities
 i 19,629


( i 18,406
)
Income taxes
 i 31,239


 i 7,847

Dividends received from investments in affiliates
 i 


 i 775

Other assets and other liabilities
( i 29,208
)

( i 9,353
)
Net cash provided by operating activities - continuing operations
 i 248,240


 i 252,304

Net cash used in operating activities - discontinued operations
( i 1,148
)

( i 4
)
Total cash provided by operating activities
$
 i 247,092


$
 i 252,300

Cash flows from investing activities:
 


 

Purchases of property and equipment
$
( i 63,196
)

$
( i 41,020
)
Purchases of capitalized data and other intangible assets
( i 29,443
)

( i 25,013
)
Cash paid for acquisitions, net of cash acquired
( i 13,280
)

( i 140,977
)
Purchases of investments
( i 658
)

 i 

Cash received from sale of business-lines
 i 4,109

 
 i 3,245

Proceeds from sale of property and equipment
 i 3


 i 198

Proceeds from investments
 i 5,591


 i 980

Net cash used in investing activities - continuing operations
( i 96,874
)

( i 202,587
)
Net cash provided by investing activities - discontinued operations
 i 


 i 

Total cash used in investing activities
$
( i 96,874
)

$
( i 202,587
)
Cash flows from financing activities:
 


 

Proceeds from long-term debt
$
 i 1,770,000


$
 i 120,095

Debt issuance costs
( i 9,621
)

 i 

Repayment of long-term debt
( i 1,844,155
)

( i 114,626
)
Proceeds from issuance of shares in connection with share-based compensation
 i 8,391


 i 19,585

Payment of tax withholdings related to net share settlements
( i 9,645
)

( i 12,623
)
Shares repurchased and retired
( i 61,607
)

( i 87,028
)
Contingent consideration payments subsequent to acquisitions
( i 612
)
 
 i 

Net cash used in financing activities - continuing operations
( i 147,249
)

( i 74,597
)
Net cash provided by financing activities - discontinued operations
 i 


 i 

Total cash used in financing activities
$
( i 147,249
)

$
( i 74,597
)
Effect of exchange rate on cash, cash equivalents and restricted cash
 i 637


 i 2,039

Net change in cash, cash equivalents and restricted cash
 i 3,606


( i 22,845
)
Cash, cash equivalents and restricted cash at beginning of period
 i 98,250


 i 132,154

Less: Change in cash, cash equivalents and restricted cash - discontinued operations
( i 1,148
)

( i 4
)
Plus: Cash swept from discontinued operations
( i 1,148
)

( i 4
)
Cash, cash equivalents and restricted cash at end of period
$
 i 101,856


$
 i 109,309



 

Supplemental disclosures of cash flow information:
 
 
 
Cash paid for interest
$
 i 53,202

 
$
 i 50,108

Cash paid for income taxes
$
 i 11,558

 
$
 i 25,406

Cash refunds from income taxes
$
 i 16,812

 
$
 i 3,271

Non-cash investing activities:
 
 
 
Capital expenditures included in accounts payable and other accrued expenses
$
 i 11,286

 
$
 i 16,911


The accompanying notes are an integral part of these condensed consolidated financial statements.

4



CoreLogic, Inc.
Condensed Consolidated Statement of Stockholders' Equity (Quarter-to-Date)
(Unaudited)

 
 
Common Stock Shares
 
Common Stock Amount
 
Additional Paid-in Capital
 
Retained Earnings
 
Accumulated Other Comprehensive Loss
 
Total
(in thousands)
 
 
 
 
 
 
For the Three Months Ended September 30, 2019
 
 
 
 
 
 
Balance as of June 30, 2019
 
 i 80,133

 
$
 i 1

 
$
 i 146,887

 
$
 i 971,490

 
$
( i 164,886
)
 
$
 i 953,492

Net income
 

 

 

 
 i 23,183

 

 
 i 23,183

Shares issued in connection with share-based compensation
 
 i 86

 

 
 i 1,832

 

 

 
 i 1,832

Payment of tax withholdings related to net share settlements
 

 

 
( i 378
)
 

 

 
( i 378
)
Share-based compensation
 

 

 
 i 9,108

 

 

 
 i 9,108

Shares repurchased and retired
 
( i 700
)
 

 
( i 32,577
)
 

 

 
( i 32,577
)
Other comprehensive loss
 

 

 

 

 
( i 21,799
)
 
( i 21,799
)
Balance as of September 30, 2019
 
 i 79,519

 
$
 i 1

 
$
 i 124,872

 
$
 i 994,673

 
$
( i 186,685
)
 
$
 i 932,861

 
 
 
 
 
 
 
 
 
 
 
 
 
For the Three Months Ended September 30, 2018
 
 
 
 
 
 
 
 
 
 
 
 
Balance as of June 30, 2018
 
 i 80,944

 
$
 i 1

 
$
 i 186,816

 
$
 i 940,314

 
$
( i 102,892
)
 
$
 i 1,024,239

Net income
 

 

 

 
 i 22,451

 

 
 i 22,451

Shares issued in connection with share-based compensation
 
 i 97

 

 
 i 2,019

 

 

 
 i 2,019

Payment of tax withholdings related to net share settlements
 

 

 
( i 941
)
 

 

 
( i 941
)
Share-based compensation
 

 

 
 i 9,775

 

 

 
 i 9,775

Shares repurchased and retired
 
( i 479
)
 

 
( i 23,706
)
 

 

 
( i 23,706
)
Other comprehensive loss
 

 

 

 

 
( i 3,721
)
 
( i 3,721
)
Balance as of September 30, 2018
 
 i 80,562

 
$
 i 1

 
$
 i 173,963

 
$
 i 962,765

 
$
( i 106,613
)
 
$
 i 1,030,116


The accompanying notes are an integral part of these condensed consolidated financial statements.

5



CoreLogic, Inc.
Condensed Consolidated Statement of Stockholders' Equity (Year-to-Date)
(Unaudited)

 
 
Common Stock Shares
 
Common Stock Amount
 
Additional Paid-in Capital
 
Retained Earnings
 
Accumulated Other Comprehensive Loss
 
Total
(in thousands)
 
 
 
 
 
 
For the Nine Months Ended September 30, 2019
 
 
 
 
 
 
Balance as of December 31, 2018
 
 i 80,092

 
$
 i 1

 
$
 i 160,870

 
$
 i 975,375

 
$
( i 135,748
)
 
$
 i 1,000,498

Net income
 

 

 

 
 i 19,298

 

 
 i 19,298

Shares issued in connection with share-based compensation
 
 i 827

 


 
 i 8,391

 

 

 
 i 8,391

Payment of tax withholdings related to net share settlements
 

 

 
( i 9,645
)
 

 

 
( i 9,645
)
Share-based compensation
 

 


 
 i 26,863

 

 

 
 i 26,863

Shares repurchased and retired
 
( i 1,400
)
 

 
( i 61,607
)
 

 

 
( i 61,607
)
Other comprehensive loss
 

 


 

 

 
( i 50,937
)
 
( i 50,937
)
Balance as of September 30, 2019
 
 i 79,519

 
$
 i 1

 
$
 i 124,872

 
$
 i 994,673

 
$
( i 186,685
)
 
$
 i 932,861

 
 
 
 
 
 
 
 
 
 
 
 
 
For the Nine Months Ended September 30, 2018
 
 
 
 
 
 
 
 
 
 
 
 
Balance as of December 31, 2017
 
 i 80,885

 
$
 i 1

 
$
 i 224,455

 
$
 i 877,111

 
$
( i 93,691
)
 
$
 i 1,007,876

Adoption of new accounting standards
 

 

 

 
( i 23,600
)
 
 i 408

 
( i 23,192
)
Net income
 

 

 

 
 i 109,254

 

 
 i 109,254

Shares issued in connection with share-based compensation
 
 i 1,428

 

 
 i 19,585

 

 

 
 i 19,585

Payment of tax withholdings related to net share settlements
 

 

 
( i 12,623
)
 

 

 
( i 12,623
)
Share-based compensation
 

 

 
 i 29,574

 

 

 
 i 29,574

Shares repurchased and retired
 
( i 1,751
)
 

 
( i 87,028
)
 

 

 
( i 87,028
)
Other comprehensive loss
 

 

 

 

 
( i 13,330
)
 
( i 13,330
)
Balance as of September 30, 2018
 
 i 80,562

 
$
 i 1

 
$
 i 173,963

 
$
 i 962,765

 
$
( i 106,613
)
 
$
 i 1,030,116


The accompanying notes are an integral part of these condensed consolidated financial statements.


6




Note 1 –  i Basis of Condensed Consolidated Financial Statements

CoreLogic, Inc., together with its subsidiaries (collectively the Company, “we”, “us” or “our”), is a leading global property information, insight, analytics and data-enabled solutions provider operating in North America, Western Europe and Asia Pacific. Our combined data from public, contributory and proprietary sources provides detailed coverage of property, mortgages and other encumbrances, consumer credit, tenancy, location, hazard risk and related performance information. The markets we serve include real estate and mortgage finance, insurance, capital markets and the public sector. We deliver value to clients through unique data, analytics, workflow technology, advisory and managed solutions. Clients rely on us to help identify and manage growth opportunities, improve performance and mitigate risk.

Our condensed consolidated financial information included in this report has been prepared in accordance with accounting principles generally accepted (“GAAP”) in the United States ("US") for interim financial information pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect amounts reported in the condensed consolidated financial statements and accompanying notes. Actual amounts may differ from these estimated amounts. Certain information and disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. The 2018 year-end condensed consolidated balance sheet was derived from the Company’s audited financial statements for the year ended December 31, 2018. Interim financial information does not require the inclusion of all the information and footnotes required by GAAP for complete financial statements. Therefore, these financial statements should be read in conjunction with our Annual Report on Form 10-K for the year ended December 31, 2018.

The accompanying unaudited condensed consolidated interim financial statements reflect all adjustments, consisting of only normal recurring items which, in the opinion of management, are necessary for a fair statement of the results of operations for the periods shown. The results of operations for such periods are not necessarily indicative of the results expected for the full year or for any future periods.

 i 
Client Concentration

We generate the majority of our operating revenues from clients with operations in the US residential real estate, mortgage origination and mortgage servicing markets. Approximately  i 31% and  i 32% of our operating revenues for the three months ended September 30, 2019 and 2018, respectively, were generated from our top ten clients, who consist of the largest US mortgage originators and servicers. None of our clients individually accounted for greater than 10% of our operating revenues for the three months ended September 30, 2019 nor 2018. Approximately  i 30% and  i 32% of our operating revenues for the nine months ended September 30, 2019 and 2018, respectively, were generated from our top ten clients with none of our clients individually accounting for greater than 10% of our operating revenues during these periods.
 / 

 i 
Cash, Cash Equivalents and Restricted Cash

We deem the carrying value of cash, cash equivalents and restricted cash to be a reasonable estimate of fair value due to the nature of these instruments. Restricted cash is comprised of certificates of deposit that are pledged for various letters of credit/bank guarantees secured by us, escrow accounts due to acquisitions and divestitures as well as short-term investments within our deferred compensation plan trust.  i The following table provides a reconciliation of cash, cash equivalents and restricted cash to amounts shown in the statement of cash flows:
 / 

(in thousands)
 
Cash and cash equivalents
$
 i 88,238

 
$
 i 97,884

Restricted cash included in other assets
 i 11,616

 
 i 10,355

Restricted cash included in prepaid expenses and other current assets
 i 2,002

 
 i 1,070

Total cash, cash equivalents and restricted cash
$
 i 101,856

 
$
 i 109,309



7



 i 
Operating Revenue Recognition

We derive our operating revenues primarily from US mortgage lenders, servicers and insurance companies with good creditworthiness. Operating revenue arrangements are written and specify the products or services to be delivered, pricing, and payment terms. Operating revenue is recognized when the distinct good, service, or performance obligation is delivered and control has been transferred to the client. Generally, clients contract with us to provide products and services that are highly interrelated and not separately identifiable. Therefore, the entire contract is accounted for as one performance obligation. At times, some of our contracts have multiple performance obligations where we allocate the total price to each performance obligation based on the estimated relative standalone selling price using observable sales or the cost-plus-margin approach.

For products or services where delivery occurs at a point in time, we recognize operating revenue when the client obtains control of the products upon delivery. When delivery occurs over time, we generally recognize operating revenue ratably over the service period, once initial delivery has occurred. For certain of our products or services, clients may also pay upfront fees, which we defer and recognize as operating revenue over the longer of the contractual term or the expected client relationship period.

Licensing arrangements that provide our clients with the right to access or use our intellectual property are considered functional licenses for which we generally recognize operating revenue based on usage. For arrangements that provide a stand-ready obligation or substantive updates to the intellectual property which the client is contractually or practically required to use, we recognize operating revenue ratably over the contractual term.

Client payment terms are standard with no significant financing components or extended payment terms granted. In limited cases, we allow for client cancellations for which we estimate a reserve.

See further discussion in Note 8 - Operating Revenues.

 i 
Comprehensive Loss

Comprehensive loss includes all changes in equity except those resulting from investments by shareholders and distributions to shareholders. Specifically, foreign currency translation adjustments, amounts related to supplemental benefit plans, unrealized gains and losses on interest rate swap transactions and investments are recorded in other comprehensive income/(loss).  i The following table shows the components of accumulated other comprehensive loss, net of taxes, as of September 30, 2019 and December 31, 2018:

(in thousands)
2019
 
2018
Cumulative foreign currency translation
$
( i 138,413
)
 
$
( i 129,406
)
Cumulative supplemental benefit plans
( i 5,406
)
 
( i 4,958
)
Net unrecognized losses on interest rate swaps
( i 42,799
)
 
( i 1,384
)
Reclassification adjustment for gain on terminated interest rate swap included in net income
( i 67
)
 
 i 

Accumulated other comprehensive loss
$
( i 186,685
)
 
$
( i 135,748
)


8



 i 
Investment in Affiliates, net

Investments in affiliates are accounted for under the equity method of accounting when we are deemed to have significant influence over the affiliate but do not control or have a majority voting interest in the affiliate. Investments are carried at the cost of acquisition, including subsequent impairments, capital contributions and loans from us, plus our equity in undistributed earnings or losses since inception of the investment, less dividends received.

For the three and nine months ended September 30, 2019, we did not have any operating revenues related to our investment in affiliates and had $ i 0.3 million and $ i 0.9 million for the three and nine months ended September 30, 2018, respectively. We recorded operating expenses of $ i 0.4 million and $ i 1.0 million related to our investment in affiliates for the three months ended September 30, 2019 and 2018, respectively, and $ i 1.1 million and $ i 6.3 million for the nine months ended September 30, 2019 and 2018, respectively.

During the three and nine months ended September 30, 2019, we recorded a non-cash impairment charge of $ i 1.5 million in our investment in affiliates, net, due to an other-than-temporary loss because we do not foresee an ability to recover the carrying amount of the investment. This loss was recorded within gain/(loss) on investments and other, net in our condensed consolidated statements of operations.  i No such impairments were recorded in the three and nine months ended September 30, 2018.

As of September 30, 2019, and December 31, 2018, we had insignificant accounts payable and accounts receivable with these affiliates.

 / 
 i 
Discontinued Operations

In September 2014, we completed the sale of our collateral solutions and field services businesses, which were included in the former reporting segment Asset Management and Processing Solutions. In September 2012, we completed the wind-down of our consumer services business and our former appraisal management company business. In September 2011, we closed our marketing services business. In December 2010, we completed the sale of our Employer and Litigation Services businesses.

In connection with previous divestitures, we retained certain contingent liabilities of the businesses that were disposed of. These contingent liabilities include, among other items, liability for certain litigation matters, indemnification obligations and potential breaches of representations or warranties. With respect to our Employer and Litigation Services divestiture, we retained certain liabilities and, in September 2016, a jury returned an unfavorable verdict against this discontinued operating unit, which we appealed. In August 2019, the verdict was upheld on appeal. We have accrued a potential loss of $ i 21.7 million as of September 30, 2019 with respect to this verdict, although we are pursuing further review of the verdict. The liability is reflected in our results from discontinued operations.

 / 
As of September 30, 2019, and December 31, 2018, we recorded assets of discontinued operations of $ i 6.3 million and $0.6 million, respectively, within prepaid expenses and other current assets within our condensed consolidated balance sheets, mainly consisting of tax-related assets. Additionally, as of September 30, 2019 and December 31, 2018, we recorded liabilities of $ i 24.1 million and $ i 2.2 million, respectively, within accounts payable and other accrued expenses, which mainly consisted of legal-related accruals.

 i 
Tax Escrow Disbursement Arrangements

We administer tax escrow disbursements as a service to our clients in connection with our tax services business. These deposits are maintained in segregated accounts for the benefit of our clients and totaled $ i 1.3 billion and $ i 0.7 billion as of September 30, 2019 and December 31, 2018, respectively. Because these deposits are held on behalf of our clients, they are not our funds and, therefore, are not included in the accompanying condensed consolidated balance sheets.

These deposits generally remain in the accounts for a period of two to five business days. We record credits from these activities as a reduction to related administrative expenses, including the cost of bank fees and other administration costs.

Under our contracts with our clients, if we make a payment in error or fail to pay a taxing authority when a payment is due, we could be held liable to our clients for all or part of the financial loss they suffer as a result of our act or omission. We maintained total claim reserves relating to incorrect disposition of assets of $ i 21.4 million and $ i 21.2 million as of September 30, 2019 and December 31, 2018, respectively. Within these amounts, $ i 9.3 million and $ i 9.2 million, respectively, are short-term and are reflected within accounts payable and other accrued expenses within our accompanying condensed consolidated balance sheets. The remaining reserves are reflected within other liabilities.
 / 

9



 i 
Recent Accounting Pronouncements

In April 2019, the Financial Accounting Standards Board (“FASB”) issued guidance to amend or clarify certain areas within three previously issued standards related to financial instruments which includes clarification for fair value using the measurement alternative, measuring credit losses and accounting for derivatives and hedging. The amendments in this guidance are largely effective for fiscal years beginning after December 15, 2019 with early adoption permitted. We have not elected early adoption and do not anticipate that this guidance will have a material impact on our consolidated financial statements.

In August 2017, the FASB issued guidance to amend and improve the accounting for hedging activities. The amendment eliminates the requirement to separately measure and report hedge ineffectiveness. An initial quantitative assessment to establish that the hedge is highly effective is still required but the amendment allows until the end of the first quarter it is designated to perform the assessment. After initial qualification, a qualitative assessment can be performed if the hedge is highly effective and the documentation at inception can reasonably support an expectation of high effectiveness throughout the hedge’s term. The amendment requires companies to present all hedged accounting elements that affect earnings in the same income statement line as the hedged item. For highly effective cash flow hedges, fair value changes will be recorded in other comprehensive loss and reclassified to earnings when the hedged item impacts earnings. The guidance became effective prospectively for fiscal years beginning after December 15, 2018. In October 2018, the FASB issued incremental guidance to this update to permit the Overnight Index Swap Rate and the Secured Overnight Financing Rate to be utilized as US benchmark interest rates for hedge accounting purposes. We have adopted this guidance beginning with fiscal year 2019 as required, which has not had a material impact on our consolidated financial statements.

In February 2016, the FASB issued guidance on lease accounting which requires leases, regardless of classification, to be recognized on the balance sheet as lease assets and liabilities. The objective of this standard is to provide greater transparency on the amount, timing and uncertainty of cash flows arising from leasing arrangements. The recognition, measurement and presentation of expenses and cash flows arising from a lease by a lessee depends upon its classification as a finance or operating lease. On January 1, 2019, we adopted the new lease accounting standard, and all related amendments, using the modified retrospective approach. Comparative information has not been restated and continues to be reported under the standards in effect for those prior periods as allowed by the guidance. As part of our adoption we elected the package of practical expedients permitted under the transition guidance which allows us to carry forward our historical lease classification of pre-existing leases, treatment of pre-existing indirect costs, as well as our conclusions of whether a pre-existing contract contains a lease. We have implemented internal controls to enable the preparation of financial information upon our adoption in the first quarter of 2019.

Adoption of the new lease accounting standard resulted in the recording of operating lease assets and lease liabilities of approximately $ i 67.7 million and $ i 103.9 million, respectively, as of January 1, 2019. There was no impact to opening equity as a result of adoption as the difference between the asset and liability balance is attributable to reclassifications of pre-existing balances, such as deferred and prepaid rent, into the lease asset balance. The adoption of this standard has not materially impacted our consolidated statement of operations or presentation of cash flows and we do not anticipate a material impact in the future based on our current operations. See below for our accounting policy reflecting the updated guidance.

 i 
Leases

We determine if an arrangement contains a lease at inception and determine the classification of the lease, as either operating or finance, at commencement.

Operating and finance lease assets and liabilities are recorded based on the present value of future lease payments which factors in certain qualifying initial direct costs incurred as well as any lease incentives received. If an implicit rate is not readily determinable, we utilize our incremental borrowing rate and inputs from third-party lenders to determine the appropriate discount rate. Lease expense for operating lease payments are recognized on a straight-line basis over the lease term. Finance leases incur interest expense using the effective interest method in addition to amortization of the leased asset on a straight-line basis, both over the applicable lease term. Lease terms may factor in options to extend or terminate the lease.

We adhere to the short-term lease recognition exemption for all classes of assets (i.e. facilities and equipment). As a result, leases with an initial term of twelve months or less are not recorded on the balance sheet and are recognized on a straight-line basis over the lease term. In addition, for certain equipment leases, we account for lease and non-lease components, such as services, as a single lease component as permitted.


10



Note 2 -  i Property and Equipment, Net
 i 

Property and equipment, net as of September 30, 2019 and December 31, 2018 consists of the following:

(in thousands)
2019
 
2018
Land
$
 i 7,476

 
$
 i 7,476

Buildings
 i 6,487

 
 i 6,487

Furniture and equipment
 i 71,993

 
 i 68,851

Capitalized software
 i 897,990

 
 i 902,482

Leasehold improvements
 i 44,424

 
 i 43,476

Construction in progress
 i 3,297

 
 i 669

 
 i 1,031,667

 
 i 1,029,441

Less accumulated depreciation
( i 585,610
)
 
( i 572,944
)
Property and equipment, net
$
 i 446,057

 
$
 i 456,497


 / 

Depreciation expense for property and equipment, net was approximately $ i 22.1 million and $ i 22.6 million for the three months ended September 30, 2019 and 2018, respectively, and $ i 68.0 million and $ i 66.8 million for the nine months ended September 30, 2019 and 2018, respectively.

Impairment losses for property and equipment, net of $ i 0.1 million and $ i 12.3 million were recorded for the three and nine months ended September 30, 2019, respectively. For the three and nine months ended September 30, 2018, impairment losses were less than $ i 0.1 million. See Note 7 - Fair Value for further discussion.

Note 3 –  i Goodwill, Net
 i 

A reconciliation of the changes in the carrying amount of goodwill and accumulated impairment losses, by reporting unit, for the nine months ended September 30, 2019 is as follows:
 
(in thousands)
PIRM
 
UWS
 
Consolidated
Balance as of January 1, 2019
 
 
 
 
 
Goodwill
$
 i 1,107,466

 
$
 i 1,292,013

 
$
 i 2,399,479

Accumulated impairment losses
( i 600
)
 
( i 6,925
)
 
( i 7,525
)
Goodwill, net
 i 1,106,866

 
 i 1,285,088

 
 i 2,391,954

Acquisition
 i 

 
 i 6,551

 
 i 6,551

Measurement period adjustments
( i 83
)
 
 i 

 
( i 83
)
Disposal
 i 

 
( i 1,337
)
 
( i 1,337
)
Translation adjustments
( i 4,113
)
 
 i 

 
( i 4,113
)
Balance as of September 30, 2019
 
 
 
 
 
Goodwill, net
$
 i 1,102,670

 
$
 i 1,290,302

 
$
 i 2,392,972

 / 

For the three and nine months ended September 30, 2019, we recorded a goodwill disposal of $ i 1.3 million related to the sale of a non-core business.

See Note 13 - Acquisitions for discussion of current year acquisition and measurement period adjustments.


11



Note 4 –  i Other Intangible Assets, Net
 i 

Other intangible assets, net consists of the following:

 
 
(in thousands)
Gross
 
Accumulated Amortization
 
Net
 
Gross
 
Accumulated Amortization
 
Net
Client lists
$
 i 660,010

 
$
( i 342,276
)
 
$
 i 317,734

 
$
 i 706,253

 
$
( i 327,201
)
 
$
 i 379,052

Non-compete agreements
 i 35,559

 
( i 24,077
)
 
 i 11,482

 
 i 35,224

 
( i 20,156
)
 
 i 15,068

Tradenames and licenses
 i 126,642

 
( i 63,864
)
 
 i 62,778

 
 i 131,130

 
( i 56,845
)
 
 i 74,285

 
$
 i 822,211

 
$
( i 430,217
)
 
$
 i 391,994

 
$
 i 872,607

 
$
( i 404,202
)
 
$
 i 468,405


 / 

Amortization expense for other intangible assets, net was $ i 14.4 million and $ i 16.3 million for the three months ended September 30, 2019 and 2018, respectively, and $ i 46.4 million and $ i 47.8 million for the nine months ended September 30, 2019 and 2018, respectively.

For the nine months ended September 30, 2019, impairment losses for other intangible assets, net of $ i 35.6 million were recorded, all of which were incurred in the second quarter of 2019. For both the three and nine months ended September 30, 2018, there were  i no impairment losses recorded. See Note 7 - Fair Value for further discussion.

 i 
Estimated amortization expense for other intangible assets, net is as follows:

(in thousands)
 
Remainder of 2019
$
 i 15,385

2020
 i 56,797

2021
 i 53,810

2022
 i 52,039

2023
 i 44,439

Thereafter
 i 169,524

 
$
 i 391,994


 / 


12



Note 5 –  i Long-Term Debt
 i 

Our long-term debt consists of the following:

 
 
 
(in thousands)
Gross
 
Debt Issuance Costs
 
Net
 
Gross
 
Debt Issuance Costs
 
Net
Bank debt:
 
 
 
 
 
 
 
 
 
 


 
Term loan facility borrowings due May 2024, weighted-average interest rate of 4.00% as of September 30, 2019
$
 i 1,706,250

 
$
( i 15,747
)
 
$
 i 1,690,503

 
$
 i 

 
$
 i 

 
$
 i 

 
Revolving line of credit borrowings due May 2024, weighted-average interest rate of 4.00% as of September 30, 2019
 i 

 
( i 6,786
)
 
( i 6,786
)
 
 i 

 
 i 

 
 i 

 
Term loan facility borrowings due August 2022, weighted-average interest rate of 4.05% as of December 31, 2018, modified May 2019
 i 

 
 i 

 
 i 

 
 i 1,597,500

 
( i 13,043
)
 
 i 1,584,457

 
Revolving line of credit borrowings due August 2022, weighted-average interest rate of 4.05% as of December 31, 2018, modified May 2019
 i 

 
 i 

 
 i 

 
 i 178,146

 
( i 5,216
)
 
 i 172,930

Notes:
 

 
 

 
 
 
 

 
 

 
 
 
7.55% senior debentures due April 2028
 i 14,524

 
( i 41
)
 
 i 14,483

 
 i 14,645

 
( i 44
)
 
 i 14,601

Other debt:
 

 
 

 
 
 
 

 
 

 


 
Various debt instruments with maturities through March 2024
 i 6,319

 
 i 

 
 i 6,319

 
 i 7,188

 
 i 

 
 i 7,188

Total long-term debt
 i 1,727,093


( i 22,574
)
 
 i 1,704,519

 
 i 1,797,479


( i 18,303
)
 
 i 1,779,176

Less current portion of long-term debt
 i 68,247

 
 i 

 
 i 68,247

 
 i 26,935

 
 i 

 
 i 26,935

Long-term debt, net of current portion
$
 i 1,658,846

 
$
( i 22,574
)
 
$
 i 1,636,272

 
$
 i 1,770,544


$
( i 18,303
)

$
 i 1,752,241


 / 

As of September 30, 2019 and December 31, 2018, we recorded $ i 1.4 million and $ i 0.7 million, respectively, of accrued interest expense on our debt-related instruments within accounts payable and other accrued expenses.

Credit Agreement

In May 2019, we amended and restated our credit agreement (the “Credit Agreement”) with Bank of America, N.A., as the administrative agent, and other financial institutions. The Credit Agreement provides for a $ i 1.8 billion five-year term loan A facility (the “Term Facility”), and a $ i 750.0 million five-year revolving credit facility (the “Revolving Facility”). The Term Facility matures, and the Revolving Facility expires, in May 2024. The Revolving Facility includes a $ i 100.0 million multi-currency revolving sub-facility and a $ i 50.0 million letter of credit sub-facility. The Credit Agreement also provides for the ability to increase the Term Facility and Revolving Facility by up to $ i 300.0 million in the aggregate; however, the lenders are not obligated to do so.

The loans under the Credit Agreement bear interest, at the election of the Company, at (i) the Alternate Base Rate (defined as the greater of (a) Bank of America's "prime rate", (b) the Federal Funds effective rate plus  i 0.50% and (c) the reserve adjusted London interbank offering rate for a one-month Eurocurrency borrowing plus  i 1.00%) plus the Applicable Rate (as defined in the Credit Agreement) or (ii) the London interbank offering rate for Eurocurrency borrowings, adjusted for statutory reserves ("Adjusted Eurocurrency Rate") plus the Applicable Rate. The initial Applicable Rate for Alternate Base Rate borrowings is  i 0.75% and for Adjusted Eurocurrency Rate borrowings is  i 1.75%. After September 2019, the Applicable Rate will vary depending upon the Company's leverage ratio. The minimum Applicable Rate for Alternate Base Rate borrowings will be  i 0.25% and the maximum will be  i 1.00%. The minimum Applicable Rate for Adjusted Eurocurrency Rate borrowings will be  i 1.25% and the maximum will be  i 2.00%. The Credit Agreement also requires the Company to pay a commitment fee for the unused portion of the Revolving Facility, which will be a minimum of  i 0.20% and a maximum of  i 0.35%, depending on the Company's leverage ratio.


13



The Credit Agreement provides that loans under the Term Facility shall be repaid in equal quarterly installments of $ i 21.9 million, commencing on September 30, 2019 and continuing on each three-month anniversary thereafter, subject to the application of prepayments to quarterly installments. The outstanding balance of the term loans will be due in May 2024.

The Credit Agreement contains the following financial maintenance covenants: (i) a maximum total leverage ratio not to exceed  i 4.50:1.00 (stepped down to  i 4.25:1.00 starting with the fiscal quarter ending on September 2020, with a further step down to  i 4.00:1.00 starting with the fiscal quarter ending on September 2021, followed by a final step down to  i 3.75:1.00 starting with the fiscal quarter ending on September 2022) and (ii) a minimum interest coverage ratio of  i 3.00:1.00.

As of September 30, 2019, we had a remaining borrowing capacity of $ i 750.0 million under the Revolving Facility and we were in compliance with all financial and restrictive covenants under the Credit Agreement.

Debt Issuance Costs

In connection with the amendment and restatement of the Credit Agreement, in May 2019, we incurred approximately $ i 9.7 million of debt issuance costs of which $ i 9.6 million were initially capitalized within long-term debt, net of current in the accompanying condensed consolidated balance sheets. In addition, when we amended and restated the Credit Agreement, we wrote-off previously unamortized debt issuance costs of $ i 1.5 million within gain/(loss) on investments and other, net in the accompanying consolidated statement of operations, which resulted in a remaining $ i 14.6 million of previously unamortized costs. We will amortize all of these costs over the term of the Credit Agreement. For the three months ended September 30, 2019 and 2018, $ i 1.2 million and $ i 1.4 million, respectively, were recognized in the accompanying condensed consolidated statements of operations related to the amortization of debt issuance costs. For the nine months ended September 30, 2019 and 2018, $ i 3.8 million and $ i 4.1 million, respectively, were recognized in the accompanying condensed consolidated statements of operations related to the amortization of debt issuance costs.

7.55% Senior Debentures

In April 1998, we issued $ i 100.0 million in aggregate principal amount of  i 7.55% senior debentures due 2028. The indentures governing these debentures, as amended, contain limited restrictions on us.

Interest Rate Swaps

We have entered into amortizing interest rate swaps (“Swaps”) in order to convert a portion of our interest rate exposure on the Term Facility floating rate borrowings from variable to fixed. Under the Swaps, we agree to exchange floating rate for fixed rate interest payments periodically over the life of the agreement. The floating rates in our Swaps are based on the one-month London interbank offering rate. The notional balances, terms and maturities of our Swaps are designed to have at least 50% of our debt as fixed rate.

As of September 30, 2019, the Swaps have a combined remaining notional balance of $ i 1.3 billion, a weighted average fixed interest rate of  i 2.05% (rates range from  i 1.03% to  i 2.98%), and scheduled terminations through December 2025. Notional balances under our Swaps are scheduled to increase and decrease based on our expectations of the level of variable rate debt to be in effect in future periods. Currently, we have scheduled notional amounts of between $ i 1.3 billion and $ i 1.2 billion through September 2021, then $ i 1.1 billion and $ i 1.0 billion through August 2022, and $ i 416.0 million and $ i 400.0 million thereafter until December 2025. Approximate weighted average fixed interest rates for the aforementioned time intervals are  i 2.39%,  i 2.64%, and  i 2.95%, respectively.

We have designated the Swaps as cash flow hedges. The estimated fair values of these cash flow hedges are recorded in prepaid expenses and other current assets as well as other assets and other liabilities in the accompanying condensed consolidated balance sheets. As of September 30, 2019, the estimated fair value of certain of these cash flow hedges resulted in an asset of $ i 1.2 million recorded within prepaid and other current assets, as well as a liability of $ i 58.3 million. As of December 31, 2018, the estimated fair value of certain of these cash flow hedges resulted in an asset of $ i 13.3 million, of which $ i 0.6 million was recorded within prepaid expenses and other current assets, as well as a liability of $ i 15.2 million.

Unrealized losses of $ i 8.1 million (net of $ i 2.7 million in deferred taxes) and unrealized gains of $ i 2.5 million (net of $ i 0.8 million in deferred taxes) for the three months ended September 30, 2019 and 2018, respectively, were recognized in other comprehensive loss related to the Swaps. Unrealized losses of $ i 41.4 million (net of $ i 13.8 million in deferred taxes) and unrealized gains of $ i 10.8 million (net of $ i 3.6 million in deferred taxes) for the nine months ended September 30, 2019 and 2018, respectively, were recognized in other comprehensive loss related to the Swaps.

14



Note 6 –  i Leases

We have entered into renewable commitment agreements for certain real estate facilities and equipment, such as computers and printers, which we individually classify as either operating or finance leases. We possess contractual options to renew certain leases ranging from  i 2 months to  i 5 years at a time, as well as, in certain instances, contractual options to terminate leases with varying notification requirements and potential termination fees. As of September 30, 2019, our leases with initial terms greater than twelve months had remaining lease terms of up to  i 13 years.
    
 i 
The following table provides a breakdown of lease balances within our condensed consolidated balance sheet as of September 30, 2019 and December 31, 2018:

(in thousands)
 
 
 
 
 
 
Lease Type and Classification
 
Included Within
 
 
Assets
 
 
 
 
 
 
Operating
 
Operating lease assets
 
$
 i 65,302

 
$
 i 

Finance
 
Property and equipment, net
 
 i 6,203

 
 i 5,002

Total
 
 
 
$
 i 71,505

 
$
 i 5,002

 
 
 
 
 
 
 
Liabilities
 
 
 
 
 
 
Current
 
 
 
 
 
 
Operating
 
Operating lease liabilities, current
 
$
 i 16,839

 
$
 i 

Finance
 
Current portion of long-term debt
 
 i 2,622

 
 i 2,340

Long-term
 
 
 
 
 
 
Operating
 
Operating lease liabilities, net of current
 
 i 85,844

 
 i 

Finance
 
Long-term debt, net of current
 
 i 3,697

 
 i 2,753

Total
 
 
 
$
 i 109,002

 
$
 i 5,093

 
 
 
 
 
 
 
(1) As permitted, December 31, 2018 is presented under the guidance in effect at that time. As such, 2018 does not contain comparable operating assets and/or liabilities. See Note 1 - Basis for Condensed Consolidated Financial Statements for further details.

 / 
    
 i 
For the three and nine months ended September 30, 2019, the components of lease cost are as follows:

(in thousands)
 
 
 
Lease Cost
 
Included Within
 
For the Three Months Ended
 
For the Nine Months Ended
Finance lease cost
 
 
 
 
 
 
Amortization of lease assets
 
Depreciation and amortization
 
$
 i 736

 
$
 i 2,307

Interest on lease liabilities
 
Interest expense
 
$
 i 39

 
$
 i 107

 
 
 
 
 
 
 
Operating lease cost
 
Selling, general and administrative expenses
 
$
 i 5,284

 
$
 i 16,315

Operating lease cost
 
Cost of services
 
 i 136

 
 i 208

 
 
 
 
$
 i 5,420

 
$
 i 16,523


Total lease cost for all operating leases, including month-to-month rentals, for the three and nine months ended September 30, 2018, excluding taxes, was $ i 5.5 million and $ i 16.8 million, respectively.    
 / 

15



Other supplementary information for the nine months ended September 30, 2019 are as follows:

(in thousands)
 
 
 
 
Other Information
 
Finance Leases
 
Operating Leases
Cash paid for amounts included in measurement of liabilities
 
 
 
 
Operating cash outflows
 
$
 i 107

 
$
 i 19,714

Financing cash outflows
 
$
 i 2,306

 
$

 
 
 
 
 
Right-of-use assets obtained in exchange for lease liabilities
 
$
 i 3,537

 
$
 i 9,587

Weighted average remaining lease term (years)
 
 i 2.8

 
 i 8.4

Weighted average discount rate
 
 i 3.78
%
 
 i 6.34
%

    
 i  i 
Maturities of lease liabilities as of September 30, 2019 are as follows:

(in thousands)
 
Finance Leases
 
Operating Leases
2019
 
$
 i 759

 
$
 i 4,122

2020
 
 i 2,621

 
 i 24,732

2021
 
 i 1,737

 
 i 19,760

2022
 
 i 1,117

 
 i 12,911

2023
 
 i 446

 
 i 10,596

Thereafter
 
 i 70

 
 i 63,691

Total lease payments
 
 i 6,750

 
 i 135,812

Less imputed interest
 
( i 431
)
 
( i 33,129
)
Total
 
$
 i 6,319

 
$
 i 102,683


 / 
 / 

 i 
Future minimum lease commitments, undiscounted, as of December 31, 2018 were as follows:

(in thousands)
 
 
2019
 
$
 i 26,738

2020
 
 i 25,413

2021
 
 i 19,214

2022
 
 i 12,149

2023
 
 i 8,908

Thereafter
 
 i 57,179

Total
 
$
 i 149,601



 / 
As of September 30, 2019, we have  i three operating leases for facilities which have not yet commenced with a combined initial lease liability of approximately $ i 4.6 million and initial terms ranging from  i 2 to  i 8 years. These liabilities are not reflected in our condensed consolidated balance sheet or the maturity schedule as of September 30, 2019 shown above.


16



Note 7 – i  Fair Value

Fair value is the price that would be received upon sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. We utilize market data or assumptions that market participants would use in pricing the asset or liability, including assumptions about risk and the risks inherent in the inputs to the valuation technique. These inputs can be readily observable, market corroborated or generally unobservable.

The market approach is applied for recurring fair value measurements and endeavors to utilize the best available information. Accordingly, we utilize valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs. Fair value balances are classified based on the observability of those inputs.

A fair value hierarchy prioritizes the inputs used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurement) and the lowest priority to unobservable inputs (Level 3 measurement). Level 2 measurements utilize observable inputs in active markets for similar assets and liabilities, or, quoted prices in markets that are not active.

In estimating fair value, we used the following methods and assumptions:

Cash and Cash Equivalents

For cash and cash equivalents, the carrying value is a reasonable estimate of fair value due to the short-term nature of the instruments.

Restricted Cash

Restricted cash is comprised of certificates of deposit that are pledged for various letters of credit/bank guarantees secured by us, escrow accounts due to acquisitions and divestitures and short-term investments within our deferred compensation plan trust. We deem the carrying value to be a reasonable estimate of fair value due to the nature of these instruments.

Other Investments

Other investments is currently comprised of a minority equity investment in a foreign enterprise which we measure at cost and adjust to fair value on a quarterly basis when there are observable price changes in orderly transactions for the identical, or similar, investments. Changes in fair value are recorded within gain/(loss) on investments and other, net in our condensed consolidated statement of operations.

Contingent Consideration

The fair value of our contingent consideration was estimated using the Monte-Carlo simulation model, which relies on significant assumptions and estimates including discount rates and future market conditions, among others.

Long-Term Debt

The fair value of debt was estimated based on the current rates available to us for similar debt of the same remaining maturities and consideration of our default and credit risk.

Interest Rate Swaps

The fair values of the Swaps were estimated based on market-value quotes received from the counterparties to the agreements.


17



The fair values of our financial instruments as of September 30, 2019 are presented in the following table:
 i 

(in thousands)
 
Fair Value Measurements Using
 
 
 
Level 1
 
Level 2
 
Level 3
 
Fair Value
Financial Assets:
 
 
 
 
 
 
 
 
Cash and cash equivalents
 
$
 i 88,238

 
$
 i 

 
$
 i 

 
$
 i 88,238

Restricted cash
 
 i 2,526

 
 i 11,092

 
 i 

 
 i 13,618

Other investments
 
 i 

 
 i 1,825

 
 i 

 
 i 1,825

Total
 
$
 i 90,764

 
$
 i 12,917

 
$
 i 

 
$
 i 103,681

 
 
 
 
 
 
 
 
 
Financial Liabilities:
 
 
 
 
 
 
 
 
Contingent consideration
 
$
 i 

 
$
 i 

 
$
 i 4,895

 
$
 i 4,895

Total debt
 
 i 

 
 i 1,731,066

 
 i 

 
 i 1,731,066

Total
 
$
 i 

 
$
 i 1,731,066

 
$
 i 4,895


$
 i 1,735,961

 
 
 
 
 
 
 
 
 
Derivatives:
 
 
 
 
 
 
 
 
Asset for Swaps
 
$
 i 

 
$
 i 1,218

 
$
 i 

 
$
 i 1,218

Liability for Swaps
 
$
 i 

 
$
 i 58,335

 
$
 i 

 
$
 i 58,335

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Financial Assets:
 
 
 
 
 
 
 
 
Cash and cash equivalents
 
$
 i 85,271

 
$
 i 

 
$
 i 

 
$
 i 85,271

Restricted cash
 
 i 1,366

 
 i 11,613

 
 i 

 
 i 12,979

Other investments
 
 i 

 
 i 

 
 i 7,930

 
 i 7,930

Total
 
$
 i 86,637

 
$
 i 11,613

 
$
 i 7,930

 
$
 i 106,180

 
 
 
 
 
 
 
 
 
Financial Liabilities:
 
 
 
 
 
 
 
 
Contingent consideration
 
$
 i 

 
$
 i 

 
$
 i 5,700

 
$
 i 5,700

Total debt
 
 i 

 
 i 1,797,597

 
 i 

 
 i 1,797,597

Total
 
$
 i 

 
$
 i 1,797,597

 
$
 i 5,700

 
$
 i 1,803,297

 
 
 
 
 
 
 
 
 
Derivatives:
 
 
 
 
 
 
 
 
Asset for Swaps
 
$
 i 

 
$
 i 13,344

 
$
 i 

 
$
 i 13,344

Liability for Swaps
 
$
 i 

 
$
 i 15,188

 
$
 i 

 
$
 i 15,188


 / 

 i 
The following non-financial instruments were measured at fair value, on a non-recurring basis, as of and for the nine months ended September 30, 2019:

 
 
 
Fair Value Measurements Using
 
 
(in thousands)
Remaining
Fair Value (1)
 
Level 1
 
Level 2
 
Level 3
 
Impairment Losses
Other intangible assets, net
$

 
$

 
$

 
$

 
$
 i 35,600

Property and equipment, net
$

 
$

 
$

 
$

 
$
 i 12,312

Investment in affiliates, net
$

 
$

 
$

 
$

 
$
 i 1,511

 
$

 
$

 
$

 
$

 
$
49,423

 
 
 
 
 
 
 
 
 
 
(1) Remaining fair value represents the post-impairment fair value related to the specifically impaired asset(s)

 / 

18



For the nine months ended September 30, 2019, we recorded non-cash impairment charges of $ i 35.6 million in other intangible assets, net, which were all incurred in the second quarter of 2019. For the three and nine months ended September 30, 2019, non-cash impairment charges of $ i 0.1 million and $ i 12.3 million, respectively, were recorded in property and equipment, net related to capitalized software. The current year impairments are primarily due to ongoing business transformation activities of our appraisal management company within our Underwriting & Workflow Solutions (“UWS”) segment. The impairments were derived using an undiscounted cash flow methodology. The impairments within other intangible assets, net include $ i 32.3 million for client lists and $ i 3.3 million for licenses. For the three and nine months ended September 30, 2019, we also recorded a $ i 1.5 million non-cash impairment charge in investment in affiliates, net, which is included within gain/(loss) on investments and other, net in our condensed consolidated statement of operations.

In connection with the 2017 acquisitions of Myriad Development, Inc. and an insignificant business, we entered into contingent consideration agreements for up to $ i 20.5 million in cash by 2022 upon the achievement of certain revenue targets ending in fiscal year 2021. These contingent payments were originally recorded at a fair value of $ i 6.2 million using the Monte-Carlo simulation model. In connection with the 2019 acquisition of National Tax Search, LLC (“NTS”), we entered into a contingent consideration agreement for up to $ i 7.5 million in cash based upon certain revenue targets in fiscal years 2020 and 2021. This contingent consideration has been initially assessed with no fair value using the Monte-Carlo simulation model. The contingent payments are fair-valued quarterly, and changes are recorded within gain/(loss) on investments and other, net in our condensed consolidated statement of operations. During the nine months ended September 30, 2019, we decreased the fair value of our contingent considerations by $ i 0.2 million and recorded the gain in our condensed consolidated statement of operations. During the three months ended September 30, 2019, there were no adjustments to our contingent consideration. During the three and nine months ended September 30, 2018, we recorded a loss of $ i 0.1 million and a gain of $ i 1.0 million, respectively.

Due to observable price changes in an inactive market, in the first half of 2019, we recorded a combined unfavorable fair value adjustment of $ i 6.6 million to a minority equity investment, which was recorded within gain/(loss) on investments and other, net in our condensed consolidated statement of operations for the nine months ended September 30, 2019. As a result of the observable price change in the current year, we transferred the minority equity investment classification from Level 3 to Level 2 within the fair value hierarchy above.


19



Note 8 –  i Operating Revenues
 i 

Operating revenues by solution type consist of the following:

(in thousands)
 
PIRM
 
UWS
 
Corporate and Eliminations
 
Consolidated
For the Three Months Ended September 30, 2019
 
 
 
 
Property insights
 
$
 i 121,843

 
$
 i 

 
$
 i 

 
$
 i 121,843

Insurance and spatial solutions
 
 i 48,739

 
 i 

 
 i 

 
 i 48,739

Flood data services
 
 i 

 
 i 22,983

 
 i 

 
 i 22,983

Valuation solutions
 
 i 

 
 i 77,426

 
 i 

 
 i 77,426

Credit solutions
 
 i 

 
 i 71,687

 
 i 

 
 i 71,687

Property tax solutions
 
 i 

 
 i 103,671

 
 i 

 
 i 103,671

Other
 
 i 11,067

 
 i 5,061

 
( i 3,520
)
 
 i 12,608

Total operating revenue
 
$
 i 181,649

 
$
 i 280,828

 
$
( i 3,520
)
 
$
 i 458,957

 
 
 
 
 
 
 
 
 
For the Three Months Ended September 30, 2018
 
 
 
 
 
 
 
 
Property insights
 
$
 i 125,319

 
$
 i 

 
$
 i 

 
$
 i 125,319

Insurance and spatial solutions
 
 i 41,666

 
 i 

 
 i 

 
 i 41,666

Flood data services
 
 i 

 
 i 18,213

 
 i 

 
 i 18,213

Valuation solutions
 
 i 

 
 i 73,468

 
 i 

 
 i 73,468

Credit solutions
 
 i 

 
 i 75,283

 
 i 

 
 i 75,283

Property tax solutions
 
 i 

 
 i 94,637

 
 i 

 
 i 94,637

Other
 
 i 13,622

 
 i 12,024

 
( i 2,464
)
 
 i 23,182

Total operating revenue
 
$
 i 180,607

 
$
 i 273,625

 
$
( i 2,464
)
 
$
 i 451,768

 
 
 
 
 
 
 
 
 
For the Nine Months Ended September 30, 2019
 
 
 
 
 
 
 
 
Property insights
 
$
 i 363,250

 
$
 i 

 
$
 i 

 
$
 i 363,250

Insurance and spatial solutions
 
 i 142,576

 
 i 

 
 i 

 
 i 142,576

Flood data services
 
 i 

 
 i 61,572

 
 i 

 
 i 61,572

Valuation solutions
 
 i 

 
 i 230,891

 
 i 

 
 i 230,891

Credit solutions
 
 i 

 
 i 211,187

 
 i 

 
 i 211,187

Property tax solutions
 
 i 

 
 i 282,724

 
 i 

 
 i 282,724

Other
 
 i 35,348

 
 i 17,989

 
( i 9,334
)
 
 i 44,003

Total operating revenue
 
$
 i 541,174

 
$
 i 804,363

 
$
( i 9,334
)
 
$
 i 1,336,203

 
 
 
 
 
 
 
 
 
For the Nine Months Ended September 30, 2018
 
 
 
 
 
 
 
 
Property insights
 
$
 i 376,284

 
$
 i 

 
$
 i 

 
$
 i 376,284

Insurance and spatial solutions
 
 i 119,691

 
 i 

 
 i 

 
 i 119,691

Flood data services
 
 i 

 
 i 54,098

 
 i 

 
 i 54,098

Valuation solutions
 
 i 

 
 i 226,368

 
 i 

 
 i 226,368

Credit solutions
 
 i 

 
 i 235,651

 
 i 

 
 i 235,651

Property tax solutions
 
 i 

 
 i 301,998

 
 i 

 
 i 301,998

Other
 
 i 41,054

 
 i 37,155

 
( i 7,230
)
 
 i 70,979

Total operating revenue
 
$
 i 537,029

 
$
 i 855,270

 
$
( i 7,230
)
 
$
 i 1,385,069



 / 

20



Property Insights

Our property insights solutions combine our patented predictive analytics and proprietary and contributed data to enable our clients to improve customer acquisition and retention, detect and prevent fraud, improve mortgage transaction cycle time and cost efficiency, identify real estate trends and neighborhood characteristics, track market performance, and increase market share. Our data is comprised of real estate information with crime, site inspection, neighborhood, document images and other information from proprietary sources. We also provide verification of applicant income, identity and certain employment verification services. We typically license data in one of two forms: bulk data licensing and transactional licensing. Operating revenue for bulk data licensing contracts that provide a stand-ready obligation or include substantive updates to the intellectual property is recognized ratably over the contractual term; otherwise, operating revenue is recognized upon delivery. For transactional licensing, we recognize operating revenue based on usage.

Insurance and Spatial Solutions

Our insurance and spatial solutions provide originators and property and casualty insurers the solutions required to more effectively locate, assess and manage property-level assets and risks through location-based data and analytics. We also provide cloud-based property claims workflow technology for property and casualty insurers. The licensed intellectual property data is generally provided to our clients on a subscription or usage basis. For subscription contracts, operating revenue is recognized ratably over the contractual term once initial delivery has occurred. For contracts to provide a license to data which is delivered via report or data file, operating revenue is recognized when the client obtains control of the products, which is upon delivery.

Property Tax Solutions

Our property tax solutions are built from aggregated property tax information from over 20,000 taxing authorities. We use this information to advise mortgage lenders and servicers of the property tax payment status of loans in their portfolio and to monitor that status over the life of the loans. If a mortgage lender or servicer requires tax payments to be impounded on behalf of its borrowers, we can also facilitate the transfer of these funds to the taxing authorities and provide the lender or servicer with payment confirmation. Property tax processing revenues are primarily comprised of periodic loan fees and life-of-loan fees. For periodic fee arrangements, we generate monthly fees at a contracted rate for as long as we service the loan. For life-of-loan fee arrangements, we charge a one-time fee when the loan is set-up in our tax servicing system. Life-of-loan fees are deferred and recognized ratably over the expected service period of  i 10 years and adjusted for early loan cancellation. Revenue recognition rates of loan portfolios are regularly analyzed and adjusted monthly to reflect current trends.

Valuation Solutions

Our valuation solutions represent property valuation-related data driven services and analytics combined with collateral valuation workflow technologies which assist our clients in assessing risk of loss using both traditional and alternative forms of property valuation, driving process efficiencies as well as ensuring compliance with lender and governmental regulations. We provide collateral information technology and solutions that automate property appraisal ordering, tracking, documentation and review for lender compliance with government regulations. Revenue for the property appraisal service is recognized when the appraisal service is performed and delivered to the client. In addition, to the extent that we provide continuous access to the hosted software platform, we recognize operating revenue over the term of the arrangement.

Credit Solutions

Our credit solutions provide credit and income verification services to the mortgage and automotive industries. We provide comprehensive information, typically in the form of a report, about credit history, income verification and home address history. We normalize the data to provide a broad range of advanced business information solutions designed to reduce risk and improve business performance to mortgage and automotive lenders. Operating revenue is recognized when the report or information is delivered to the client.

Flood Data Services

Our flood data services provide flood zone determinations primarily to mortgage lenders in accordance with US Federal legislation passed in 1994, which requires that most lenders obtain a determination of the current flood zone status at the time each loan is originated and obtain applicable updates during the life of the loan if contracted to do so. We also provide flood zone determinations to insurance companies. We generally recognize operating revenue upon delivery of the initial determination. If contracted for life of loan monitoring, we recognize operating revenue over the estimated service period, as adjusted for early loan cancellation.

21



Contract Costs

Incremental costs to obtain or fulfill client contracts are recognized as an asset. As of September 30, 2019, we had $ i 9.5 million of current deferred contract costs which are presented in prepaid expenses and other current assets, as well as $ i 21.4 million of long-term deferred contract costs which are presented in other assets in our condensed consolidated balance sheet. As of December 31, 2018, we had $ i 9.7 million of current deferred contract costs and $ i 20.8 million of long-term deferred contract costs. Our deferred contract costs primarily include certain set-up and acquisition costs related to property tax solutions, which amortize ratably over an expected 10-year life, adjusted for early loan cancellations. For the three months ended September 30, 2019 and 2018, we recorded amortization associated with deferred contract costs of $ i 3.4 million and $ i 3.8 million, respectively, and $ i 9.8 million and $ i 10.7 million, respectively, for the nine months ended September 30, 2019 and 2018.

Contract Liabilities

We record a contract liability when amounts are invoiced, which is generally prior to the satisfaction of the performance obligation. For property tax solutions, we invoice upfront fees to clients for services to be performed over time. For property insights and insurance and spatial solutions we invoice quarterly and annually, commencing upon execution of the contracts or at the beginning of the license term, as applicable.

As of September 30, 2019, we had $ i 853.9 million in contract liabilities compared to $ i 833.0 million as of December 31, 2018. The overall change of $ i 20.9 million in contract liability balances are primarily due to $ i 453.9 million of new deferred billings in the current year, partially offset by $ i 433.9 million of operating revenue recognized, of which $ i 253.6 million related to contracts previously deferred, and other increases of $ i 0.9 million.

Remaining Performance Obligations

The majority of our arrangements are between one and three years with a significant portion being one year or less. For the remaining population of non-cancellable and fixed arrangements greater than one year, as of September 30, 2019 we had $ i 968.4 million of remaining performance obligations. We expect to recognize approximately  i 9% percent of this remaining revenue backlog in 2019,  i 31% in 2020,  i 21% in 2021 and  i 39% thereafter. See further discussion of performance obligations in Note 1 - Basis for Condensed Consolidated Financial Statements.


22



Note 9 – i  Share-Based Compensation

We currently issue equity awards under the CoreLogic, Inc. 2018 Performance Incentive Plan (the “Plan”), which was approved by our stockholders at our Annual Meeting held in May 2018. The Plan includes the ability to grant share-based instruments such as restricted stock units (“RSUs”), performance-based restricted stock units (“PBRSUs”) and stock options. Prior to the approval of the Plan, we issued share-based awards under the CoreLogic, Inc. 2011 Performance Incentive Plan, as amended, which was preceded by the CoreLogic, Inc. 2006 Incentive Plan. The Plan provides for up to  i 15,139,084 shares of the Company's common stock to be available for award grants.

We have primarily utilized RSUs and PBRSUs as our share-based compensation instruments for employees and directors. The fair value of any share-based compensation instrument grant is based on the market value of our common stock on the date of grant and is recognized as compensation expense over its vesting period.

Restricted Stock Units

For the nine months ended September 30, 2019 and 2018, we awarded  i 640,339 and  i 537,022 RSUs, respectively, with an estimated grant-date fair value of $ i 23.5 million and $ i 25.1 million, respectively. The RSU awards will vest ratably over 3 years.  i RSU activity for the nine months ended September 30, 2019 is as follows:
 
 
Number of Shares
 
Weighted-Average
Grant-Date Fair Value
(in thousands, except weighted-average fair value prices)
 
Unvested RSUs outstanding at December 31, 2018
 i 1,087

 
$
 i 42.04

RSUs granted
 i 640

 
$
 i 36.67

RSUs vested
( i 549
)
 
$
 i 40.49

RSUs forfeited
( i 98
)
 
$
 i 39.94

Unvested RSUs outstanding at September 30, 2019
 i 1,080

 
$
 i 39.84



As of September 30, 2019, there was $ i 26.7 million of total unrecognized compensation cost related to unvested RSUs that is expected to be recognized over a weighted-average period of  i 1.9 years. The fair value of RSUs are based on the market value of our common stock on the date of grant.

Performance-Based Restricted Stock Units

For the nine months ended September 30, 2019 and 2018, we awarded  i 203,464 and  i 408,097 PBRSUs, respectively, with an estimated grant-date fair value of $ i 7.5 million and $ i 19.2 million, respectively. These awards are generally subject to service-based, performance-based and market-based vesting conditions. The service and performance period for the 2019 grants is from January 2019 to December 2021 and the performance metric is adjusted earnings per share.

The performance and service period for the PBRSUs awarded during 2018 is from January 2018 to December 2020 and the performance metrics are generally adjusted earnings per share and market-based conditions. These grants include  i 232,225 PBRSUs that do not include a market-based condition but have adjusted margin or operating revenue as the performance metric through the service period ending December 2020 or December 2021.


23



 i 
The fair values of the awards containing market-based vesting conditions were estimated using Monte-Carlo simulation with the following weighted-average assumptions:

 
For the Nine Months Ended September 30,
 
2019
 
2018
Expected dividend yield
 i 
%
 
 i 
%
Risk-free interest rate (1)
 i 2.44
%
 
 i 2.38
%
Expected volatility (2)
 i 28.24
%
 
 i 23.63
%
Average total stockholder return (2)
 i 17.15
%
 
 i 6.11
%
 
 
 
 
(1) The risk-free interest rate for the periods within the contractual term of the PBRSUs is based on the US Treasury yield curve in effect at the time of the grant.
(2) The expected volatility and average total stockholder return are measures of the amount by which a stock price has fluctuated or is expected to fluctuate based primarily on our and our peers' historical data.

 / 

 i 
PBRSU activity for the nine months ended September 30, 2019 is as follows:

 
Number of Shares
 
Weighted-Average
Grant-Date Fair Value
(in thousands, except weighted-average fair value prices)
 
Unvested PBRSUs outstanding at December 31, 2018
 i 774

 
$
 i 42.11

PBRSUs granted
 i 203

 
$
 i 36.82

PBRSUs vested
( i 250
)
 
$
 i 34.40

PBRSUs forfeited
( i 106
)
 
$
 i 45.36

Unvested PBRSUs outstanding at September 30, 2019
 i 621

 
$
 i 42.61


 / 

As of September 30, 2019, there was $ i 16.3 million of total unrecognized compensation cost related to unvested PBRSUs that is expected to be recognized over a weighted-average period of  i 1.7 years. The fair value of PBRSUs are based on the market value of our common stock on the date of grant.

Stock Options

Prior to 2015, we issued stock options as incentive compensation for certain employees.  i Option activity for the nine months ended September 30, 2019 is as follows:

(in thousands, except weighted-average price)
Number of
Shares
 
Weighted-Average
Exercise Price
 
Weighted-Average
Remaining
Contractual Term
 
Aggregate
Intrinsic
Value
Options outstanding at December 31, 2018
 i 570

 
$
 i 20.17

 
 
 
 
Options exercised
( i 80
)
 
$
 i 24.20

 
 
 
 
Options vested, exercisable, and outstanding at September 30, 2019
 i 490

 
$
 i 19.51

 
 i 2.6
 
$
 i 13,095


As of September 30, 2019, there was  i no unrecognized compensation cost related to unvested stock options.

The intrinsic value of options exercised was $ i 1.4 million and $ i 14.3 million for the nine months ended September 30, 2019 and 2018, respectively. This intrinsic value represents the difference between the fair market value of our common stock on the date of exercise and the exercise price of each option.


24



Employee Stock Purchase Plan

The employee stock purchase plan allows eligible employees to purchase our common stock at  i 85.0% of the lesser of the closing price on the first day or the last day of each quarter. Our employee stock purchase plan was approved by our stockholders at our 2012 annual meeting of stockholders and the first offering period commenced in October 2012. We recognize an expense for the amount equal to the estimated fair value of the discount during each offering period.

 i 
The following table sets forth the share-based compensation expense recognized for the three and nine months ended September 30, 2019 and 2018:

 
For the Three Months Ended
 
For the Nine Months Ended
 
September 30,
 
September 30,
(in thousands)
2019
 
2018
 
2019
 
2018
RSUs
$
 i 4,715

 
$
 i 5,752

 
$
 i 17,639

 
$
 i 20,385

PBRSUs
 i 4,001

 
 i 3,621

 
 i 7,659

 
 i 7,780

Stock options
 i 

 
 i 

 
 i 

 
 i 

Employee stock purchase plan
 i 392

 
 i 402

 
 i 1,565

 
 i 1,409

 
$
 i 9,108

 
$
 i 9,775

 
$
 i 26,863

 
$
 i 29,574


 / 
The table above includes $ i 0.6 million and $ i 1.0 million of share-based compensation expense within cost of services in the accompanying condensed consolidated statements of operations for the three months ended September 30, 2019 and 2018, respectively, and $ i 2.0 million and $ i 4.4 million for the nine months ended September 30, 2019 and 2018, respectively.

Note 10 –  i Litigation and Regulatory Contingencies

We have been named in various lawsuits and we are from time to time subject to audit or investigation by governmental agencies arising in the ordinary course of business.

With respect to matters where we have determined that a loss is both probable and reasonably estimable, we have recorded a liability representing our best estimate of the financial exposure based on known facts. For matters where a settlement has been reached, we have recorded the expected amount of such settlements. With respect to audits, investigations or lawsuits that are ongoing, although their final dispositions are not yet determinable, we do not believe that the ultimate resolution of such matters, either individually or in the aggregate, will have a material adverse effect on our financial condition, results of operations or cash flows. The ability to predict the ultimate outcome of such matters involves judgments, estimates and inherent uncertainties. The actual outcome of such matters could differ materially from management’s estimates. We record expenses for legal fees as incurred.

Fair Credit Reporting Act Class Actions
    
In July 2017, Rental Property Solutions, LLC (“RPS”) was named as a defendant in Claudinne Feliciano, et. al., v. CoreLogic SafeRent, LLC, a putative class action lawsuit in the US District Court for the Southern District of New York. The named plaintiff alleges that RPS prepared a background screening report about her that contained a record of a New York Housing Court action without noting that the action had previously been dismissed. On this basis, she seeks damages under the Fair Credit Reporting Act and the New York Fair Credit Reporting Act on behalf of herself and a class of similarly situated consumers with respect to reports issued during the period of July 2015 to the present. In July 2019, the District Court issued an order certifying a class of approximately  i 2,000 consumers. We have filed a petition for review of the certification order to the Second Circuit Court of Appeals. The petition is pending.

25



Separation

Following the Separation, we are responsible for a portion of First American Financial Corporation's (“FAFC”) contingent and other corporate liabilities. In the Separation and Distribution Agreement we entered into in connection with the Separation (the “Separation and Distribution Agreement”), we agreed with FAFC to share equally in the cost of resolution of a small number of corporate-level lawsuits, including certain consolidated securities litigation matters from which we have since been dropped. There were no liabilities incurred in connection with the consolidated securities matters. Responsibility to manage each case has been assigned to either FAFC or us, with the managing party required to update the other party regularly and consult with each other prior to certain important decisions, such as settlement. The managing party will also have primary responsibility for determining the ultimate total liability, if any, related to the applicable case. We will record our share of any such liability when the responsible party determines a reserve is necessary. As of September 30, 2019,  i no reserves were considered necessary by the applicable responsible party.

In addition, the Separation and Distribution Agreement provides for cross-indemnities principally designed to place financial responsibility for the obligations and liabilities of our predecessor, The First American Corporation's (“FAC”) financial services business, with FAFC and financial responsibility for the obligations and liabilities of FAC's information solutions business with us. Specifically, each party will, and will cause its subsidiaries and affiliates to, indemnify, defend and hold harmless the other party, its respective affiliates and subsidiaries and each of its respective officers, directors, employees and agents for any losses arising out of or otherwise in connection with the liabilities each such party assumed or retained pursuant to the Separation.

Note 11 –  i Income Taxes

The effective income tax rate for income taxes as a percentage of income from continuing operations before equity in earnings/(losses) of affiliates and income taxes was  i 26.6% and  i 47.9% for the three months ended September 30, 2019 and 2018, respectively, and  i 1.4% and  i 26.0% for the nine months ended September 30, 2019 and 2018, respectively.

For the three months ended September 30, 2019, when compared to 2018, the decrease in the effective income tax rate was primarily due to a one-time charge of $ i 12.5 million for the transition tax (in connection with the Tax Cuts and Jobs Act) which was recorded in the prior year.

For the nine months ended September 30, 2019, when compared to 2018, the decrease in the effective income tax rate was primarily due to a $ i 15.3 million discrete benefit recorded during the current year for the release of state tax reserves and a prior year one-time charge of $ i 12.5 million for the transition tax.

We are currently under examination for the years 2010 through 2012 and 2016, by the US Internal Revenue Service, our primary taxing authority, and for other years by various state taxing authorities. It is reasonably possible the amount of the unrecognized benefits with respect to certain unrecognized tax positions could significantly increase or decrease within the next twelve months and have an impact on our net income. Currently, we expect expiration of statutes of limitations, within the next twelve months, for which we have tax reserves recorded of approximately $ i 0.9 million as of September 30, 2019.


26



Note 12 –  i Earnings Per Share
 i 

The following is a reconciliation of net income per share:
 
For the Three Months Ended
 
For the Nine Months Ended
 
September 30,
 
 
2019
 
2018
 
2019
 
2018
(in thousands, except per share amounts)
 
 
 
 
 
 
 
Numerator for basic and diluted net income per share:
 
 
 
 
 
 
 
Net income from continuing operations
$
 i 40,545

 
$
 i 22,535

 
$
 i 36,754

 
$
 i 109,429

Loss from discontinued operations, net of tax
( i 17,362
)
 
( i 84
)
 
( i 17,456
)
 
( i 175
)
Net income
$
 i 23,183

 
$
 i 22,451

 
$
 i 19,298

 
$
 i 109,254

Denominator:
 

 
 

 
 

 
 

Weighted-average shares for basic income/(loss) per share
 i 79,761

 
 i 80,680

 
 i 80,138

 
 i 81,073

Dilutive effect of stock options and RSUs
 i 1,153

 
 i 1,337

 
 i 1,067

 
 i 1,455

Weighted-average shares for diluted income/(loss) per share
 i 80,914

 
 i 82,017

 
 i 81,205

 
 i 82,528

Income/(loss) per share
 

 
 

 
 

 
 

Basic:
 

 
 

 
 

 
 

Net income from continuing operations
$
 i 0.51

 
$
 i 0.28

 
$
 i 0.46

 
$
 i 1.35

Loss from discontinued operations, net of tax
( i 0.22
)
 
 i 

 
( i 0.22
)
 
 i 

Net income
$
 i 0.29

 
$
 i 0.28

 
$
 i 0.24

 
$
 i 1.35

Diluted:
 

 
 
 
 
 
 
Net income from continuing operations
$
 i 0.50

 
$
 i 0.27

 
$
 i 0.45

 
$
 i 1.33

Loss from discontinued operations, net of tax
( i 0.21
)
 
 i 

 
( i 0.21
)
 
 i 

Net income
$
 i 0.29

 
$
 i 0.27

 
$
 i 0.24

 
$
 i 1.33


 / 

The dilutive effect of share-based compensation awards has been calculated using the treasury-stock method. For both the three months ended September 30, 2019 and 2018, an aggregate of less than  i 0.1 million RSUs were excluded from the weighted-average diluted common shares outstanding due to their anti-dilutive effect. For both the nine months ended September 30, 2019 and 2018, an aggregate of less than 0.1 million of RSUs and PBRSUs were excluded from the weighted-average diluted common shares outstanding due to their anti-dilutive effect.

Note 13 –  i Acquisitions

In August 2019, we completed the acquisition of National Tax Search LLC ("NTS") for $ i 15.0 million, subject to certain working capital adjustments, and up to $ i 7.5 million to be paid in cash by 2022, contingent upon the achievement of certain revenue targets in fiscal years 2020 and 2021 (see Note 7 - Fair Value for further details). NTS is a leading provider of commercial property tax payment services and specializes in identifying potential collateral loss related to unpaid property tax, homeowners association fee management, and inaccurate flood zone determination. The NTS acquisition increases the Company's commercial property information offerings and is expected to drive future growth in the US. NTS is included as a component of our UWS segment. The purchase price was allocated to the assets acquired and liabilities assumed using a variety of valuation techniques including discounted cash flow analysis, which included significant unobservable inputs. We have preliminarily recorded client lists of $ i 4.6 million with an estimated useful life of  i 10 years, proprietary technology of $ i 3.2 million with an estimated useful life of  i 7 years, trademarks of $ i 0.9 million with an estimated useful life of  i 7 years, non-compete agreements of $ i 0.3 million with an estimated useful life of  i 5 years, contract liabilities of $ i 1.8 million, and goodwill of $ i 6.6 million, all of which is deductible for tax purposes.

In December 2018, we acquired the remaining  i 72.0% of Symbility Solutions Inc. (“Symbility”) for C$ i 107.1 million, or approximately US $ i 80.0 million, subject to certain working capital adjustments. Symbility is a leading global provider of cloud-based property claims workflow solutions for the property and casualty insurance industry, headquartered in Canada. This acquisition further progresses our long-term strategic plan by adding scale to our insurance and spatial businesses and international presence. Symbility is included as a component of our Property Intelligence & Risk Management (“PIRM”) segment. The purchase price was allocated to the assets acquired and liabilities assumed using a variety of valuation techniques including discounted cash flow analysis, which included significant unobservable inputs. We have preliminarily recorded

27



proprietary technology of $ i 14.9 million with an estimated useful life of  i 8 years, client lists of $ i 6.4 million with an estimated useful life of  i 12 years, trademarks of $ i 1.2 million with an estimated useful life of  i 4 years, $ i 5.3 million of deferred tax liabilities, and goodwill of $ i 75.6 million. In connection with this acquisition, we remeasured our existing  i 28.0% investment ownership in Symbility which resulted in a $ i 13.3 million step-up gain that we recorded within gain/(loss) on investments and other, net in our consolidated statement of operations in the fourth quarter of 2018. For the nine months ended September 30, 2019, goodwill decreased by $ i 0.2 million as a result of a change in the purchase price allocation for certain working capital adjustments.

In December 2018, we completed the acquisition of Breakaway Holdings, LLC d.b.a Homevisit (“HomeVisit”) for $ i 12.7 million, subject to certain working capital adjustments. HomeVisit is a leading provider of marketing focused real estate solutions, including property listing photography, videography, 3D modeling, drone imagery and related services. Given anticipated synergy with our pre-existing real estate solutions platforms, this acquisition is expected to enable the next generation of property marketing solutions for real estate professionals, multiple listing services (“MLSs”), brokers and agents across North America. HomeVisit is included as a component of our PIRM segment. The purchase price was allocated to the assets acquired and liabilities assumed using a variety of valuation techniques including discounted cash flow analysis, which included significant unobservable inputs. We have preliminarily recorded $ i 1.4 million for non-compete agreements with an estimated useful life of  i 5 years, client lists of $ i 0.9 million with an estimated useful life of  i 11 years, trademarks of $ i 0.2 million with an estimated useful life of  i 3 years, and goodwill of $ i 10.4 million, all of which is deductible for tax purposes. For the nine months ended September 30, 2019, goodwill increased by $ i 0.1 million as a result of a change in the purchase price allocation for certain working capital adjustments.

In April 2018, we completed the acquisition of a la mode technologies, LLC (“a la mode”) for $ i 120.0 million, exclusive of working capital adjustments. a la mode is a provider of subscription-based software solutions that facilitate the aggregation of data, imagery and photographs in a government-sponsored enterprise compliant format for the completion of US residential appraisals. This acquisition contributes to our continual development and scaling of our end-to-end valuation solutions workflow suite, which includes data and market insights, analytics as well as data-enabled services and platforms. a la mode is included as a component of our UWS reporting segment. The purchase price was allocated to the assets acquired and liabilities assumed using a variety of valuation techniques including discounted cash flow analysis, which included significant unobservable inputs. We recorded contract liabilities of $ i 7.5 million, proprietary technology of $ i 15.8 million with an estimated useful life of  i 7 years, customer lists of $ i 32.5 million with an estimated average useful life of  i 13 years, tradenames of $ i 9.0 million with an estimated useful life of  i 8 years, non-compete agreements of $ i 5.7 million with an estimated useful life of  i 5 years, and goodwill of $ i 63.6 million, of which $ i 61.4 million is deductible for tax purposes.

In February 2018, we completed the acquisition of eTech Solutions Limited (“eTech”) for cash of approximately £ i 15.0 million, or approximately $ i 21.0 million, exclusive of working capital adjustments. eTech is a leading provider of innovative mobile surveying and workflow management software that enhances productivity and mitigates risk for participants in the United Kingdom (“UK”) valuation market. This acquisition expands our UK presence and strengthens our technology platform offerings. eTech is included as a component of our PIRM reporting segment. The purchase price was allocated to the assets acquired and liabilities assumed using a variety of valuation techniques including discounted cash flow analysis, which included significant unobservable inputs. We recorded a deferred tax liability of $ i 1.6 million, proprietary technology of $ i 7.0 million with an estimated useful life of  i 5 years, customer lists of $ i 1.7 million with an estimated average useful life of  i 9 years, and goodwill of $ i 14.1 million.

These business combinations did not have a material impact on our condensed consolidated statements of operations.

We incurred $ i 0.1 million and $ i 0.2 million of acquisition-related costs within selling, general and administrative expenses on our condensed consolidated statement of operations for the three months ended September 30, 2019 and 2018, respectively, and $ i 0.3 million and $ i 1.9 million for the nine months ended September 30, 2019 and 2018, respectively.

28



Note 14 –  i Segment Information

We have organized into  i two reportable segments: PIRM and UWS.

Property Intelligence & Risk Management Solutions. Our PIRM segment combines property information, mortgage information and consumer information to deliver unique housing market and property-level insights, predictive analytics and risk management capabilities. We have also developed proprietary technology and software platforms to access, automate or track this information and assist our clients with decision-making and compliance tools in the real estate industry, insurance industry and the single and multifamily industry. We deliver this information directly to our clients in a standard format over the web, through hosted software platforms or in bulk data form. Our solutions include property insights and insurance and spatial solutions in North America, Western Europe and Asia Pacific. The segment's primary clients are commercial banks, mortgage lenders and brokers, investment banks, fixed-income investors, real estate agents, MLS companies, property and casualty insurance companies, title insurance companies, government agencies and government-sponsored enterprises.

The operating results of our PIRM segment included intercompany revenues of $ i 2.7 million and $ i 1.7 million for the three months ended September 30, 2019 and 2018, respectively, and $ i 6.7 million and $ i 4.9 million for the nine months ended September 30, 2019 and 2018, respectively. The segment also included intercompany expenses of $ i 0.8 million and $ i 0.7 million for the three months ended September 30, 2019 and 2018, respectively, and $ i 2.6 million and $ i 2.3 million for the nine months ended September 30, 2019 and 2018, respectively.

Underwriting & Workflow Solutions. Our UWS segment combines property information, mortgage information and consumer information to provide comprehensive mortgage origination and monitoring solutions, including, underwriting-related solutions and data-enabled valuations and appraisals. We have also developed proprietary technology and software platforms to access, automate or track this information and assist our clients with vetting and onboarding prospects, meeting compliance regulations and understanding, diagnosing and monitoring property values. Our solutions include property tax solutions, valuation solutions, credit solutions and flood services in North America. The segment’s primary clients are large, national mortgage lenders and servicers, but we also serve regional mortgage lenders and brokers, credit unions, commercial banks, fixed-income investors, government agencies and property and casualty insurance companies.

The operating results of our UWS segment included intercompany revenues of $ i 0.8 million and $ i 0.7 million for the three months ended September 30, 2019 and 2018, respectively, and $ i 2.6 million and $ i 2.3 million for the nine months ended September 30, 2019 and 2018, respectively. The segment also included intercompany expenses of $ i 2.7 million and $ i 1.7 million for the three months ended September 30, 2019 and 2018, respectively, and $ i 6.7 million and $ i 4.9 million for the nine months ended September 30, 2019 and 2018, respectively.

We also separately report on our corporate and eliminations. Corporate consists primarily of corporate personnel and other expenses associated with our corporate functions and facilities, investment gains and losses, equity in earnings/(losses) of affiliates, net of tax, and interest expense.


29



 i 
Selected financial information by reportable segment is as follows:
(in thousands)
 
Operating Revenues
 
Depreciation and Amortization
 
Operating Income/(Loss)
 
Equity in Earnings/(Losses) of Affiliates, Net of Tax
 
Net Income/(Loss) From Continuing Operations
 
Capital Expenditures
 
 
 
 
 
 
For the Three Months Ended September 30, 2019
 
 
 
 
 
 
PIRM
 
$
 i 181,649

 
$
 i 25,015

 
$
 i 23,443

 
$
 i 762

 
$
 i 27,197

 
$
 i 12,221

UWS
 
 i 280,828

 
 i 13,012

 
 i 77,758

 
( i 4
)
 
 i 74,803

 
 i 2,319

Corporate
 
 i 

 
 i 7,690

 
( i 27,501
)
 
( i 153
)
 
( i 61,455
)
 
 i 15,078

Eliminations
 
( i 3,520
)
 
 i 

 
 i 

 
 i 

 
 i 

 
 i 

Consolidated (excluding discontinued operations)
 
$
 i 458,957

 
$
 i 45,717

 
$
 i 73,700

 
$
 i 605

 
$
 i 40,545

 
$
 i 29,618

 
 
 
 
 
 
 
 
 
 
 
 
 
For the Three Months Ended September 30, 2018
 
 

 
 

 
 
 
 
 
 

 
 

PIRM
 
$
 i 180,607

 
$
 i 26,143

 
$
 i 22,978

 
$
( i 168
)
 
$
 i 24,242

 
$
 i 12,200

UWS
 
 i 273,625

 
 i 16,402

 
 i 61,850

 
( i 12
)
 
 i 61,621

 
 i 3,151

Corporate
 
 i 

 
 i 5,916

 
( i 25,048
)
 
 i 19

 
( i 63,328
)
 
 i 10,715

Eliminations
 
( i 2,464
)
 
 i 

 
 i 

 
 i 

 
 i 

 
 i 

Consolidated (excluding discontinued operations)
 
$
 i 451,768

 
$
 i 48,461

 
$
 i 59,780

 
$
( i 161
)
 
$
 i 22,535

 
$
 i 26,066

 
 
 
 
 
 
 
 
 
 
 
 
 
For the Nine Months Ended September 30, 2019
 
 

 
 

 


 


 
 

 
 

PIRM
 
$
 i 541,174

 
$
 i 77,927

 
$
 i 60,821

 
$
 i 720

 
$
 i 57,856

 
$
 i 42,124

UWS
 
 i 804,363

 
 i 42,544

 
 i 143,389

 
( i 12
)
 
 i 140,615

 
 i 12,948

Corporate
 
 i 

 
 i 21,571

 
( i 94,716
)
 
( i 211
)
 
( i 161,717
)
 
 i 37,567

Eliminations
 
( i 9,334
)
 
 i 

 
 i 

 
 i 

 
 i 

 
 i 

Consolidated (excluding discontinued operations)
 
$
 i 1,336,203

 
$
 i 142,042

 
$
 i 109,494

 
$
 i 497

 
$
 i 36,754

 
$
 i 92,639


 


 


 


 


 


 


For the Nine Months Ended September 30, 2018
 
 

 
 

 


 


 
 

 
 

PIRM
 
$
 i 537,029

 
$
 i 77,341

 
$
 i 72,730

 
$
 i 3,843

 
$
 i 77,208

 
$
 i 39,323

UWS
 
 i 855,270

 
 i 47,849

 
 i 195,800

 
( i 4
)
 
 i 195,243

 
 i 7,850

Corporate
 
 i 

 
 i 16,758

 
( i 74,694
)
 
( i 930
)
 
( i 163,022
)
 
 i 18,860

Eliminations
 
( i 7,230
)
 
 i 

 
 i 

 
 i 

 
 i 

 
 i 

Consolidated (excluding discontinued operations)
 
$
 i 1,385,069

 
$
 i 141,948

 
$
 i 193,836

 
$
 i 2,909

 
$
 i 109,429

 
$
 i 66,033


(in thousands)
 
 
 
 
Assets
 
 
PIRM
 
$
 i 1,906,138

 
$
 i 1,953,732

UWS
 
 i 2,170,041

 
 i 2,200,292

Corporate
 
 i 6,056,340

 
 i 5,995,787

Eliminations
 
( i 6,000,412
)
 
( i 5,981,450
)
Consolidated (excluding discontinued operations)
 
$
 i 4,132,107

 
$
 i 4,168,361


 / 

30



Item 2.  Management’s Discussion and Analysis of Financial Condition and Results of Operations.

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
 
This Quarterly Report on Form 10-Q and certain information incorporated herein by reference contain forward-looking statements within the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. All statements included or incorporated by reference in this Quarterly Report, other than statements that are purely historical, are forward-looking statements. Words such as “anticipate,” “expect,” “intend,” “plan,” “believe,” “seek,” “estimate,” “will,” “should,” “would,” “could,” “may,” and similar expressions also identify forward-looking statements. The forward-looking statements include, without limitation, statements regarding our future operations, financial condition and prospects, operating results, revenues and earnings liquidity, our estimated income tax rate, unrecognized tax positions, amortization expenses, impact of recent accounting pronouncements, our cost management program, our acquisition strategy and our growth plans, expectations regarding our recent acquisitions, share repurchases, the level of aggregate US mortgage originations and the reasonableness of the carrying value related to specific financial assets and liabilities.

Our expectations, beliefs, objectives, intentions and strategies regarding future results are not guarantees of future performance and are subject to risks and uncertainties that could cause actual results to differ materially from results contemplated by our forward-looking statements. These risks and uncertainties include, but are not limited to:

compromises in the security or stability of our data and systems, including from cyber-based attacks, the unauthorized transmission of confidential information or systems interruptions;
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 clients or us, including with respect to consumer financial services and the use of public records and consumer data;
difficult or uncertain conditions in the mortgage and consumer lending industries and the economy generally;
reliance on our top ten clients for a significant portion of our revenue and profit;
intense competition in the market against third parties and the in-house capabilities of our clients;
risks related to the outsourcing of services and international operations;
our ability to realize the anticipated benefits of certain acquisitions and the timing thereof;
our cost-reduction program and growth strategies, and our ability to effectively and efficiently implement them;
our ability to protect proprietary technology rights and avoid infringement of others’ proprietary technology rights;
the level of our indebtedness, our ability to service our indebtedness and the restrictions in our various debt agreements;
our ability to attract and retain qualified management;
impairments in our goodwill or other intangible assets; and
the remaining tax sharing arrangements and other obligations associated with the spin-off of First American Financial Corporation (“FAFC”).

We urge you to carefully consider these risks and uncertainties and review the additional disclosures we make concerning risks and uncertainties that may materially affect the outcome of our forward-looking statements and our future business and operating results, including those made in Item 1A of Part I of our Annual Report on Form 10-K for the year ended December 31, 2018, as such risk factors may be amended, supplemented or superseded from time to time by other reports we file with the Securities and Exchange Commission. We assume no obligation to update any forward-looking statements, whether as a result of new information, future events, or otherwise, except as required by applicable law. You are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date of the filing of this Quarterly Report on Form 10-Q.


31



Business Overview

We are a leading global property information, analytics and data-enabled software platforms and services provider operating in North America, Western Europe and Asia Pacific. Our combined data from public, contributory and proprietary sources provides detailed coverage of property, mortgages and other encumbrances, property risk and replacement cost, consumer credit, tenancy, location, hazard risk and related performance information. We have more than one million users who rely on our data and predictive decision analytics to reduce risk, enhance transparency and improve the performance of their businesses.

We offer our clients a comprehensive national database covering real property and mortgage information, judgments and liens, building and replacement costs, parcel and geospatial data, criminal background records, eviction information, non-prime lending records, credit information, and tax information, among other data types. Our databases include over 900 million historical property transactions, over 100 million mortgage applications and property-specific data covering approximately 99% of US residential properties, as well as commercial locations, totaling nearly 150 million records. We are also the industry's first parcel-based geocoder and have developed a proprietary parcel database covering more than 150 million parcels across the United States (“US”). We believe the quality of the data we offer is distinguished by our broad range of data sources and our expertise in aggregating, organizing, normalizing, processing and delivering data to our clients.

With our data as a foundation, we have built strong analytics capabilities and a variety of value-added business services to meet our clients’ needs for property tax processing, property valuation, mortgage and automotive credit reporting, tenancy screening, hazard risk, property risk and replacement cost, flood plain location determination, other geospatial data analytics, and related services.

Reportable Segments

We have organized into the following two reportable segments:

Our Property Intelligence & Risk Management (“PIRM”) segment combines property information, mortgage information, and consumer information to deliver unique housing market and property-level insights, predictive analytics and risk management capabilities. We have also developed proprietary technology and software platforms to access, automate or track this information and assist our clients with decision-making and compliance tools in the real estate industry, insurance industry and the single and multifamily industry. We deliver this information directly to our clients in a standard format over the web, through hosted software platforms or in bulk data form. Our solutions include property insights as well as insurance and spatial solutions in North America, Western Europe and Asia Pacific.

Our Underwriting & Workflow Solutions (“UWS”) segment combines property information, mortgage information and consumer information to provide comprehensive mortgage origination and monitoring solutions, including underwriting-related solutions and data-enabled valuations and appraisals. We have also developed proprietary technology and software platforms to access, automate or track this information and assist our clients with vetting and on-boarding prospects, meeting compliance regulations and understanding, diagnosing and monitoring property values. Our solutions include property tax solutions, valuation solutions, credit solutions and flood services in North America.


32



Results of Operations

Overview of Business Environment and Company Developments

Business Environment

The volume of US mortgage loan originations serves as a key market driver for more than half of our business. We believe the volume of real estate and mortgage transactions is primarily affected by real estate prices, the availability of funds for mortgage loans, mortgage interest rates, housing supply, employment levels and the overall state of the US economy. We believe mortgage unit volumes were approximately 20% to 25% higher in the third quarter of 2019 relative to the same period in 2018, primarily due to a continued low interest rate environment during which the 10 year US Treasury yield and mortgage interest rates significantly declined. As a result, refinance volumes activity has strengthened and we now expect full-year 2019 mortgage unit volumes to be approximately 8% to 10% higher than 2018 levels.
    
We generate the majority of our operating revenues from clients with operations in the US residential real estate, mortgage origination and mortgage servicing markets. Approximately 31% and 32% of our operating revenues for the three months ended September 30, 2019 and 2018, respectively, were generated from our top ten clients, who consist of the largest US mortgage originators and servicers. None of our clients individually accounted for greater than 10% of our operating revenues for the three months ended September 30, 2019 nor 2018. Approximately 30% and 32% of our operating revenues for the nine months ended September 30, 2019 and 2018, respectively, were generated from our top ten clients with none of our clients individually accounting for greater than 10% of our operating revenues during these periods.

While the majority of our revenues are generated in the US, continued strengthening of the US dollar versus other currencies in 2019 unfavorably impacted the translation of the financial results of our international operating revenues by $8.2 million for the nine months ended September 30, 2019.

Acquisitions

In August 2019, we completed the acquisition of National Tax Search, LLC (“NTS”) for $15.0 million, subject to certain working capital adjustments. NTS is included as a component of our UWS segment. See Note 13 - Acquisitions for further discussion.

Business Exits & Transformation

In December 2018, we announced the intent to exit a loan origination software unit and our remaining legacy default management related platforms, as well as accelerate our appraisal management company (“AMC”) transformation program. We believe these actions will expand our overall profit margins and provide for enhanced long-term organic growth trends. In September 2019, we divested our default technology-related platforms and received proceeds of $3.8 million and expect the AMC transformation to be concluded by December 31, 2019. For the three and nine months ended September 30, 2019, we incurred lower revenues of approximately $16.0 million and $30.0 million, respectively, attributable to our business exits and strategic transformation. We also recorded non-cash impairment charges of $47.8 million and severance expense of $5.4 million in 2019 relating to the AMC transformation program.

Productivity and Cost Management

In line with our on-going commitment to operational excellence and margin expansion, we are targeting a cost reduction of at least $20.0 million in 2019. Savings are expected to be realized through the reduction of operating costs, selling, general and administrative costs, outsourcing certain business process functions, consolidation of facilities and other operational improvements.


33



Consolidated Results of Operations
 
Three Months Ended September 30, 2019 Compared to the Three Months Ended September 30, 2018

Operating Revenues

Our consolidated operating revenues were $459.0 million for the three months ended September 30, 2019, an increase of $7.2 million, or 1.6% when compared to the comparable period in 2018, and consisted of the following:

(in thousands, except percentages)
2019
 
2018
 
$ Change
 
% Change
PIRM
$
181,649

 
$
180,607

 
$
1,042

 
0.6
%
UWS
280,828

 
273,625

 
7,203

 
2.6

Corporate and eliminations
(3,520
)
 
(2,464
)
 
(1,056
)
 
42.9

Operating revenues
$
458,957

 
$
451,768

 
$
7,189

 
1.6
%

Our PIRM segment operating revenues increased by $1.0 million, or 0.6%, for the three months ended September 30, 2019 when compared to 2018. Excluding acquisition activity of $11.1 million, operating revenues decreased $10.1 million due to lower property insights revenues of $5.6 million which included unfavorable foreign exchange of $2.5 million and weaker market conditions in Australia of $3.1 million. Insurance and spatial solutions revenues decreased by $1.9 million primarily due to softer market demand mainly in catastrophic risk modeling. Other revenues decreased by $2.6 million.

Our UWS segment revenues increased by $7.2 million, or 2.6%, for the three months ended September 30, 2019 when compared to 2018. The variance is primarily due to higher mortgage market volumes and market share gains across our property tax, flood data and valuation solutions, partially offset by the impact of our business exits and transformation initiatives which lowered our revenues by approximately $16.0 million within valuation solutions and other revenues. Refer to "Business Exits & Transformation" discussion above for further details.

Our corporate and eliminations were comprised of intercompany revenue eliminations between our operating segments.

Cost of Services (excluding depreciation and amortization)

Our consolidated cost of services was $228.2 million for the three months ended September 30, 2019, a decrease of $2.2 million, or 1.0%, when compared to 2018. Excluding acquisition activity of $6.2 million, the decrease of $8.4 million was primarily due to lower operating revenues and favorable product mix.

Selling, General and Administrative Expenses

Our consolidated selling, general and administrative expenses was $111.3 million for the three months ended September 30, 2019, a decrease of $1.8 million, or 1.6%, when compared to 2018. Excluding acquisition activity of $5.4 million, the decrease of $7.2 million was primarily due to lower professional fees of $7.9 million, lower outsourced services of $4.4 million, and personnel-related savings of $1.7 million. These were offset by higher productivity-related investments of $6.1 million and higher other expenses of $0.7 million.

Depreciation and Amortization

Our consolidated depreciation and amortization expense was $45.7 million for the three months ended September 30, 2019, a decrease of $2.7 million, or 5.7%, when compared to 2018. Excluding acquisition activity of $1.2 million, the decrease of $3.9 million was primarily due to assets that were fully impaired during the previous quarter.


34



Operating Income

Our consolidated operating income was $73.7 million for the three months ended September 30, 2019, an increase of $13.9 million, or 23.3%, when compared to 2018, and consisted of the following:

(in thousands, except percentages)
 
2019
 
2018
 
$ Change
 
% Change
PIRM
 
$
23,443

 
$
22,978

 
$
465

 
2.0
%
UWS
 
77,758

 
61,850

 
15,908

 
25.7

Corporate and eliminations
 
(27,501
)
 
(25,048
)
 
(2,453
)
 
9.8

Operating income
 
$
73,700

 
$
59,780

 
$
13,920

 
23.3
%

Our PIRM segment operating income increased by $0.5 million, or 2.0%, for the three months ended September 30, 2019 when compared to 2018. Excluding acquisition activity of $0.1 million operating income increased by $0.6 million and margins increased by 108 basis points, primarily due to the impact of our ongoing operational efficiency programs.

Our UWS segment operating income increased by $15.9 million, or 25.7%, for the three months ended September 30, 2019 when compared to 2018. Excluding acquisition activity of $0.1 million, operating income increased by $16.0 million and margins increased by 517 basis points, primarily driven by higher revenues, favorable product mix, and the impact of our ongoing operational efficiency programs.

Corporate and eliminations had an unfavorable variance of $2.5 million, or 9.8%, for the three months ended September 30, 2019 when compared to 2018, primarily due to higher investments in data and technology capabilities.

Total Interest Expense, net

Our consolidated total interest expense, net was $19.5 million for the three months ended September 30, 2019, an increase of $0.4 million, or 2.2%, when compared to 2018. The increase was primarily due to higher interest rates on our interest rate swaps (“Swaps”). See Note 5 - Long-Term Debt for further discussion on the Swaps.

Gain/(Loss) on Investments and Other, net

Our consolidated gain on investments and other, net was $0.2 million for the three months ended September 30, 2019, an unfavorable variance of $2.6 million, when compared to 2018. The current period net primarily includes $1.3 million gain related to the sale of a non-core business unit and other gains of $0.4 million, largely offset by a loss of $1.5 million related to a non-cash impairment charge on an equity method investment. The prior year period primarily reflects $1.0 million in gains related to supplemental benefit plans as well as a $1.7 million gain from the sale of a non-core business-line.

Provision for Income Taxes

Our consolidated provision for income taxes from continuing operations before equity in earnings/(losses) of affiliates and income taxes was $14.5 million and $20.8 million for the three months ended September 30, 2019 and 2018, respectively. The effective tax rate was 26.6% and 47.9% for the three months ended September 30, 2019 and 2018, respectively. The change in the effective income tax rate was primarily due to the one-time charge of $12.5 million for the transition tax (in connection with the Tax Cuts and Jobs Act) which we recorded in the prior year.

Equity in Earnings/(Losses) of Affiliates, net of tax

Our consolidated equity in earnings of affiliates, net of tax was $0.6 million for the three months ended September 30, 2019, a favorable variance of $0.8 million when compared to 2018. We have equity interests in various affiliates which had earnings in the current period compared to prior year losses causing the favorable variance.

Loss from Discontinued Operations, net of tax

Our consolidated loss from discontinued operations, net of tax was $17.4 million for the three months ended September 30, 2019. This loss principally related to the impact of an appellate court decision in August 2019 pertaining to a discontinued operating unit, for which we recorded a liability of $21.7 million as of September 30, 2019. See Note 1 - Basis of Condensed Consolidated Financial Statements for further information.

35




Nine Months Ended September 30, 2019 Compared to Nine Months Ended September 30, 2018

Operating Revenues

Our consolidated operating revenues were $1.3 billion for the nine months ended September 30, 2019, a decrease of $48.9 million, or 3.5%, when compared to 2018, and consisted of the following:

(in thousands, except percentages)
2019
 
2018
 
$ Change
 
% Change
PIRM
$
541,174

 
$
537,029

 
$
4,145

 
0.8
 %
UWS
804,363

 
855,270

 
(50,907
)
 
(6.0
)
Corporate and eliminations
(9,334
)
 
(7,230
)
 
(2,104
)
 
29.1

Operating revenues
$
1,336,203

 
$
1,385,069

 
$
(48,866
)
 
(3.5
)%

Our PIRM segment revenues increased by $4.1 million, or 0.8%, for the nine months ended September 30, 2019 when compared to 2018. Excluding acquisition activity of $37.7 million, the decrease of $33.6 million was primarily due to lower property insight revenues of $24.7 million as well as lower insurance and spatial solutions revenues of $2.6 million primarily due to lower volumes. Property insights included unfavorable foreign exchange of $8.2 million and weaker market conditions in Australia, which negatively impacted revenues by $7.3 million. Other revenues decreased by $6.3 million.

Our UWS segment revenues decreased by $50.9 million, or 6.0%, for the nine months ended September 30, 2019 when compared to 2018. Excluding acquisition activity of $9.4 million, the decrease of $60.3 million was primarily due to lower property tax solutions of $19.3 million primarily driven by a prior year benefit of accelerated revenue recognition and lower credit solutions of $24.5 million primarily related to lower volumes. Additionally, our valuation solutions and other revenues reflect the impact of our business exits and transformation initiatives which lowered our segment revenues by approximately $30.0 million. Refer to "Business Exits & Transformation" discussion above for further details. The decrease was partially offset by higher flood data and valuations solutions due to increased market volumes.
    
Our corporate and eliminations were comprised of intercompany revenue eliminations between our operating segments.

Cost of Services (excluding depreciation and amortization)

Our consolidated cost of services was $674.5 million for the nine months ended September 30, 2019, a decrease of $34.7 million, or 4.9%, when compared to 2018. Excluding acquisition activity of $20.8 million, the decrease of $55.5 million was primarily due to lower operating revenues.

Selling, General and Administrative Expenses

Our consolidated selling, general and administrative expenses were $362.3 million for the nine months ended September 30, 2019, an increase of $22.2 million, or 6.5%, when compared to 2018. Excluding acquisition activity of $20.4 million, the increase of $1.8 million was primarily due to higher productivity-related investments of $14.0 million, higher severance expense of $5.5 million, higher professional fees of $2.4 million, partially offset by lower outsourced services of $16.0 million, personnel-related savings of $3.9 million, and lower other expenses of $0.2 million.

Depreciation and Amortization

Our consolidated depreciation and amortization expense was $142.0 million for the nine months ended September 30, 2019, an increase of $0.1 million, or 0.1%, when compared to 2018. Excluding acquisition activity of $5.6 million, the decrease of $5.5 million is primarily due to assets that were fully impaired during the current year.

Impairment Loss

Our consolidated impairment loss totaled $47.9 million for the nine months ended September 30, 2019, primarily representing write-offs of client lists of $32.3 million, software of $12.3 million, and licenses of $3.3 million related to ongoing business transformation activities of our AMC business within our UWS segment.

36




Operating Income

Our consolidated operating income was $109.5 million for the nine months ended September 30, 2019, a decrease of $84.3 million, or 43.5%, when compared to 2018, and consisted of the following:

(in thousands, except percentages)
 
2019
 
2018
 
$ Change
 
% Change
PIRM
 
$
60,821

 
$
72,730

 
$
(11,909
)
 
(16.4
)%
UWS
 
143,389

 
195,800

 
(52,411
)
 
(26.8
)
Corporate and eliminations
 
(94,716
)
 
(74,694
)
 
(20,022
)
 
26.8

Operating income
 
$
109,494

 
$
193,836

 
$
(84,342
)
 
(43.5
)%

Our PIRM segment operating income decreased by $11.9 million, or 16.4%, for the nine months ended September 30, 2019 when compared to 2018. Excluding acquisition activity of $0.7 million, operating income decreased by $11.2 million and margins decreased by 124 basis points primarily due to lower operating revenues, partially offset by the impact of our ongoing operational efficiency programs.

Our UWS segment operating income decreased by $52.4 million, or 26.8%, for the nine months ended September 30, 2019 when compared to 2018. Excluding acquisition activity of $1.0 million, operating income decreased by $53.4 million, primarily impacted by an impairment loss of $47.9 million, lower revenues driven by a prior year benefit of accelerated revenue recognition and higher severance charges related to ongoing business transformation activities of our AMC business, partially offset by the impact of our ongoing operational efficiency programs.

Corporate and eliminations had an unfavorable variance of $20.0 million, or 26.8%, for the nine months ended September 30, 2019 primarily due to higher investments in data and technology capabilities as well as higher severance.

Total Interest Expense, net

Our consolidated total interest expense, net was $57.4 million for the nine months ended September 30, 2019, an increase of $2.4 million, or 4.4%, when compared to 2018. The increase was primarily due to higher interest rates on our Swaps. See Note 5 - Long-Term Debt for further discussion on the Swaps.

Gain/(Loss) on Investments and Other, net

Our consolidated loss on investments and other, net was $1.9 million for the nine months ended September 30, 2019, an unfavorable variance of $7.1 million, or 137.6%, when compared to 2018. The unfavorable variance was primarily due to a loss of $6.6 million related to a fair value adjustment on an equity investment, a loss of $1.5 million related to a non-cash impairment charge on an equity method investment, a write-off of $1.5 million of unamortized debt issuance costs due to financing activities in May 2019, and a prior year gain of $1.0 million on our contingent consideration agreements. These were partially offset by higher realized gains related to our supplemental benefit plans of $1.7 million, a current period gain of $1.3 million related to the sale of a non-core business unit, and other gains of $0.5 million.

Tax Indemnification Release

During the second quarter of 2019, we recorded a $13.4 million loss related to the release of a tax indemnification receivable due to the expiration of the statutes of limitations in our principal state jurisdictions. Associated state tax reserves of $15.3 million were also released and recognized as income tax benefit through the provision for income taxes.

Provision for Income Taxes

Our consolidated provision for income taxes from continuing operations before equity in earnings/(losses) of affiliates and income taxes was $0.5 million and $37.4 million for the nine months ended September 30, 2019 and 2018, respectively. The effective tax rate was 1.4% and 26.0% for the nine months ended September 30, 2019 and 2018, respectively. The decrease in the effective income tax rate was primarily due to a $15.3 million discrete benefit recorded during the second quarter of 2019 for the reversal of state tax reserves in addition to the one-time charge of $12.5 million for the transition tax (in connection with the Tax Cuts and Jobs Act) which was recorded in the prior year.


37



Equity in Earnings/(Losses) of Affiliates, net of tax

Our consolidated equity in earnings of affiliates, net of tax was $0.5 million for the nine months ended September 30, 2019, an unfavorable variance of $2.4 million, or 82.9% when compared to 2018. The decrease was primarily related to the acquisition of Symbility in December 2018 which had previously been an equity method investment.

Loss from Discontinued Operations, net of tax

Our consolidated loss from discontinued operations, net of tax was $17.5 million for the nine months ended September 30, 2019. This loss principally related to the impact of an appellate court decision in August 2019 pertaining to a discontinued operating unit, for which we recorded a liability of $21.7 million as of September 30, 2019. See Note 1 - Basis of Condensed Consolidated Financial Statements for further information.

Liquidity and Capital Resources

Cash and cash equivalents as of September 30, 2019 totaled $88.2 million, a decrease of $3.0 million from December 31, 2018. As of September 30, 2019, our cash balances held in foreign jurisdictions totaled $41.1 million and are primarily related to our international operations. We plan to maintain significant cash balances outside of the US for the foreseeable future.

Restricted cash of $13.6 million as of September 30, 2019 and $13.0 million as of December 31, 2018 was comprised of certificate of deposits that are pledged for various letters of credit/bank guarantees secured by us, escrow accounts due to acquisitions and divestitures, as well as short-term investments within our deferred compensation plan trust.

Cash Flow

Operating Activities. Cash provided by operating activities reflects net income adjusted for certain non-cash items and changes in operating assets and liabilities. Total cash provided by operating activities was approximately $247.1 million and $252.3 million for the nine months ended September 30, 2019 and 2018, respectively. The decrease in cash provided by operating activities was primarily due to lower net income from continuing operations, as adjusted for non-cash activities, offset by favorable changes in working capital items.

Investing Activities. Total cash used in investing activities was approximately $96.9 million and $202.6 million during the nine months ended September 30, 2019 and 2018, respectively. The decrease was primarily related to lower net cash paid for acquisitions of $127.7 million partially offset by higher investments in technology and innovation of $26.6 million.

Financing Activities. Total cash used in financing activities was approximately $147.2 million for the nine months ended September 30, 2019, which was primarily comprised of repayments of long-term debt of $1.8 billion, debt issuance costs of $9.6 million, share repurchases of $61.6 million, net outflows from share-based compensation-related transactions of $1.3 million, partially offset by proceeds from long-term debt of $1.8 billion. Total cash used in financing activities was approximately $74.6 million for the nine months ended September 30, 2018, which was primarily comprised of repayment of long-term debt of $114.6 million and share repurchases of $87.0 million, partially offset by proceeds from long-term debt of $120.1 million and net proceeds from share-based compensation-related transactions of $7.0 million.

Financing and Financing Capacity

Total debt outstanding, gross, was $1.7 billion and $1.8 billion, respectively, for the periods as of September 30, 2019 and December 31, 2018. Our significant debt instruments and borrowing capacity are described below.

Credit Agreement

In May 2019, we amended and restated our credit agreement (the “Credit Agreement”). The Credit Agreement provides for a $1.8 billion term loan facility (the “Term Facility”), and a $750.0 million revolving credit facility (the “Revolving Facility”). The Term Facility matures and the Revolving Facility expires on May 31, 2024. The Revolving Facility includes a $100.0 million multi-currency revolving sub-facility and a $50.0 million letter of credit sub-facility. The Credit Agreement also provides for the ability to increase the Term Facility and Revolving Facility by up to $300.0 million in the aggregate; however, the lenders are not obligated to do so. As of September 30, 2019, we had borrowing capacity under the Revolving Facility of $750.0 million and were in compliance with the financial and restrictive covenants of the Credit Agreement. See Note 5 - Long-Term Debt for further discussion.


38



Interest Rate Swaps
 
We have entered into amortizing Swaps in order to convert a portion of our interest rate exposure on the Term Facility floating rate borrowings from variable to fixed. Under the Swaps, we agree to exchange floating rate for fixed rate interest payments periodically over the life of the agreement. The floating rates in our Swaps are based on the one-month London interbank offering rate. The notional balances, terms, and maturities of our Swaps are designed to have at least 50% of our debt as fixed rate.

As of September 30, 2019, the Swaps have a combined remaining notional balance of $1.3 billion, a weighted average fixed interest rate of 2.05% (rates range from 1.03% to 2.98%), and scheduled terminations through December 2025. Notional balances under our Swaps are scheduled to increase and decrease over their contract lengths based on our expectations of the level of variable rate debt to be in effect in future periods. Currently, we have scheduled notional amounts of between $1.3 billion and $1.2 billion through September 2021, then $1.1 billion and $1.0 billion through August 2022, and $416.0 million and $400.0 million thereafter until December 2025. Approximate weighted average fixed interest rates for the aforementioned time intervals are 2.39%, 2.64%, and 2.95%, respectively.

Liquidity and Capital Strategy

We expect that cash flow from operations and current unrestricted cash balances, together with available borrowings under our Revolving Facility, will be sufficient to meet operating requirements through the next twelve months. Cash available from operations, however, could be affected by any general economic downturn or any decline or adverse changes in our business such as a loss of clients, market and or competitive pressures or other significant change in business environment.

We strive to pursue a balanced approach to capital allocation and will consider the repurchase of common shares, the retirement of outstanding debt, investments and the pursuit of strategic acquisitions on an opportunistic basis.

During the quarter ended September 30, 2019, we repurchased 0.7 million shares of our common stock for $32.6 million. See Unregistered Sales of Equity Securities and Use of Proceeds - Purchases of Equity Securities by the Issuer and Affiliated Purchasers for further discussion.

Availability of Additional Capital

Our access to additional capital fluctuates as market conditions change. There may be times when the private capital markets and the public debt or equity markets lack sufficient liquidity or when our securities cannot be sold at attractive prices or at all, in which case we would not be able to access capital from these sources. Based on current market conditions and our financial condition, we believe that we have the ability to effectively access these liquidity sources for new borrowings if and when needed for the next twelve months. However, a weakening of our financial condition, including a significant decrease in our profitability or cash flows or a material increase in our leverage, could adversely affect our ability to access these markets and/or increase our cost of borrowings.

Critical Accounting Policies and Estimates

For additional information with respect to our critical accounting policies, which are those that could have the most significant effect on our reported results and require subjective or complex judgments by management, see Item 7, Management's Discussion and Analysis of Financial Condition and Results of Operations,” of our Annual Report on Form 10-K for the year ended December 31, 2018. Management believes there have been no material changes to this information. See also Note 1 – Basis for Condensed Consolidated Financial Statements for updates on our accounting policies over lease accounting.

39



Item 3.  Quantitative and Qualitative Disclosures about Market Risk.

Our primary exposure to market risk relates to interest-rate risk associated with certain financial instruments. We monitor our risk associated with fluctuations in interest rates and currently use derivative financial instruments to hedge some of these risks.

As of September 30, 2019, we had approximately $1.7 billion in gross, long-term debt outstanding, predominately all of which was variable-interest-rate debt. An increase in interest rates could increase the costs of our variable-interest-rate debt obligations. Rising interest rates could also limit our ability to refinance our debt when it matures or cause us to pay higher interest rates upon refinancing and increase interest expense on refinanced indebtedness.

To manage our interest rate risk we have entered into Swaps in order to convert a portion of our interest rate exposure on the Term Facility floating rate borrowings from variable to fixed. Under the Swaps, we agree to exchange floating rate for fixed rate interest payments periodically over the life of the agreement. The notional balances, terms and maturities of our Swaps are currently designed to have at least 50% of our debt as fixed rate. As of September 30, 2019, the combined remaining notional balance of the Swaps was $1.3 billion, with a weighted average fixed interest rate of 2.05% (rates range from 1.03% to 2.98%), and scheduled terminations through December 2025. Notional balances under our Swaps are scheduled to increase and decrease over their contract lengths based on our expectations of the level of variable rate debt to be in effect in future periods. A hypothetical 1% increase or decrease in interest rates would result in an approximately $0.9 million change to interest expense on our existing indebtedness as of September 30, 2019 on a quarterly basis.

Although we are subject to foreign currency exchange rate risk as a result of our operations in certain foreign countries, the foreign exchange exposure related to these operations, in the aggregate, is not material to our financial condition or results of operations.

Item 4.  Controls and Procedures.

Evaluation of Disclosure Controls and Procedures

Our principal executive officer and principal financial officer have concluded that, as of the end of the quarterly period covered by this Quarterly Report on Form 10-Q, our disclosure controls and procedures, as defined in Rule 13a-15(e) of the Securities Exchange Act of 1934, as amended, were effective, based on the evaluation of these controls and procedures required by Rule 13a-15(b).

Changes in Internal Control over Financial Reporting

There has been no change in our internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Securities Exchange Act of 1934, as amended) that occurred during the quarter ended September 30, 2019, that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.


40



PART II: OTHER INFORMATION

Item  1.  Legal Proceedings.

For a description of our legal proceedings, see Note 1 - Basis for Condensed Consolidated Financial Statements and Note 10 – Litigation and Regulatory Contingencies of our condensed consolidated financial statements, which is incorporated by reference in response to this item.

Item  1A.  Risk Factors.

We have described in our Annual Report on Form 10-K for the fiscal year ended December 31, 2018, the primary risks related to our business, and we may periodically update those risks for material developments. Those risks are not the only ones we face, but do represent those risks that we believe are material to us. Our business is also subject to the risks that affect many other companies, such as general economic conditions, geopolitical events and employment relations. Additional risks and uncertainties not presently known to us or that we currently deem immaterial may also harm our business. Please read the cautionary notice regarding forward-looking statements under the heading “Management's Discussion and Analysis of Financial Condition and Results of Operations.” You should carefully consider the risks and uncertainties our business faces.

There have been no material changes to the Risk Factors described in our Annual Report on Form 10-K for the fiscal year ended December 31, 2018.


41



Item 2.  Unregistered Sales of Equity Securities and Use of Proceeds.

Unregistered Sales of Equity Securities

During the quarter ended September 30, 2019, we did not issue any unregistered shares of our common stock.

Purchases of Equity Securities by the Issuer and Affiliated Purchasers

In October 2018, the Board of Directors canceled all prior repurchase authorizations and established a new share repurchase authorization of up to $500.0 million. As of September 30, 2019, we have $416.4 million in value of shares of common stock (inclusive of commissions and fees) available to be repurchased under the plan. The stock repurchase authorization has no expiration date and repurchases may be made in the open market, in privately negotiated transactions or pursuant to a Rule 10b5-1 plan.

Under our Credit Agreement, our stock repurchase capacity is restricted to $150.0 million per fiscal year, with the ability to undertake an additional amount of repurchases in such fiscal year provided that, on a pro forma basis after giving effect to the stock repurchase, our total leverage ratio does not exceed 3.5 to 1.0. While we continue to preserve the capacity to execute stock repurchases under our existing share repurchase authorization, going forward we will strive to pursue a balanced approach to capital allocation and will consider the repurchase of shares of our common stock, the retirement of outstanding debt and the pursuit of strategic acquisitions on an opportunistic basis.

During the quarter ended September 30, 2019, we repurchased 0.7 million shares of our common stock in open market purchases pursuant to the terms of our stock repurchase authorization.

 
 
 
 
 
 
 
 
Issuer Purchases of Equity Securities
 
 
 
 
 
 
Period
Total Number of Shares Purchased
 
Average Price Paid per Share (1)
 
Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs
 
Approximate Dollar Value of Shares that May Yet be Purchased Under the Plans or Programs
July 1 to July 31, 2019
275,000

 
$
45.76

 
275,000

 
$
436,350,432

August 1 to August 31, 2019
371,073

 
$
46.85

 
371,073

 
$
418,965,662

September 1 to September 30, 2019
53,927

 
$
48.38

 
53,927

 
$
416,357,582

Total
700,000

 
$

 
700,000

 
 
 
 
 
 
 
 
 
 
(1) Calculated inclusive of commissions.


42



Item 6.  Exhibits.
Exhibit
Number
 
Description
 
 
 
3.1
 
 
 
 
3.2
 
 
 
 
31.1
 
 
 
 
31.2
 
 
 
 
32.1
 
 
 
 
32.2
 
 
 
 
101
 
The following unaudited consolidated financial statements for the quarter ended September 30, 2019 included in this quarterly report on Form 10-Q formatted in Inline XBRL: (i) Condensed Consolidated Balance Sheets, (ii) Condensed Consolidated Statements of Operations, (iii) Condensed Consolidated Statements of Comprehensive Income, (iv) Condensed Consolidated Statement of Stockholders' Equity, and (v) Notes to Condensed Consolidated Financial Statements, tagged as blocks of text and including detailed tagsü
 
 
 
104
 
Cover Page Interactive Data File (formatted in Inline XBRL and included in the interactive data files submitted as Exhibit 101)ü

 
ü
 
**
Furnished herewith.


43




SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
 
 
 
CoreLogic, Inc.
 
 
(Registrant)
 
 
 
 
 
By: /s/   Frank D. Martell
 
 
 
 
President and Chief Executive Officer
 
 
(Principal Executive Officer)
 
 
 
 
 
By: /s/  James L. Balas
 
 
 
 
Chief Financial Officer
 
 
(Principal Financial Officer)
 
 
 
 
 
By: /s/  John K. Stumpf
 
 
 
 
Controller
 
 
(Principal Accounting Officer)
Date:
 


44

Dates Referenced Herein   and   Documents Incorporated by Reference

This ‘10-Q’ Filing    Date    Other Filings
5/31/24
12/31/1910-K,  11-K
12/15/19
Filed on:10/24/19
10/21/19
For Period end:9/30/19
8/31/19
7/31/19
6/30/1910-Q
1/1/19
12/31/1810-K,  11-K
12/15/18
9/30/1810-Q
6/30/1810-Q
12/31/1710-K,  11-K
 List all Filings 
Top
Filing Submission 0000036047-19-000098   –   Alternative Formats (Word / Rich Text, HTML, Plain Text, et al.)

Copyright © 2024 Fran Finnegan & Company LLC – All Rights Reserved.
AboutPrivacyRedactionsHelp — Fri., Mar. 29, 8:51:33.2am ET