CoreLogic Revenues Up Despite Mortgage Contraction

IRVINE, CA—Research firm CoreLogic reports an increase in revenues during the second quarter and growth in its data-and-analytics sector, as well as market outperformance in technology and processing solutions. All of this took place in a market where US mortgage volumes are estimated to have contracted 50%.

The firm reports Q2 revenues of $349.4 million, up 0.4% from the previous quarter, and data-and-analytics growth increased 14%, fueled by growth in insurance, spatial solutions and international. Technology and processing solutions was down 11% as share gains partially offset the impact of lower mortgage originations and discretionary spending.

In addition, operating income from continuing operations totaled $42.1 million, a decrease of 11%, reflecting the impact of lower US mortgage volumes, acquisition-related costs, severance charges and stranded AMPS overhead costs; net adjusted EBITDA totaled $94.1 million, with an adjusted EBITDA margin of 27%; and the company reduced its debt by $51 million.

“CoreLogic delivered strong operating results in the second quarter despite the continuing contraction in US mortgage volumes,” says Anand Nallathambi, president and CEO of CoreLogic. “We invested in areas of strategic growth and operational excellence, which we believe will provide sustainable, long-term value creation for our stakeholders.”

Nallathambi adds that as the firm moves forward, it will continue to shift its business mix aggressively “toward data-driven, subscription-based models built around unique data sets, analytics and data-enabled services. The successful transformation of our business operations over the past three years has underpinned our consistent outperformance of the broader housing and mortgage markets and positions us for growth and margin expansion in the future.”

The firm delivered strong margins and free cash flow in the second quarter, says Frank Martell, COO and CFO of CoreLogic. It also progressed its major operational initiatives, exceeded its cost-reduction targets, reduced its debt and repurchased close to one million of its common shares. “Over the balance of 2014, we will remain focused on progressing our imperatives of growing our D&A segment to over 50% of our total revenues and ensuring that our TPS operations outperform their respective markets and are well-positioned to capitalize on a rebound in US mortgage volumes form current trough levels.”

As GlobeSt.com reported in May, CoreLogic completed the acquisition of Marshall & Swift Boeckh and DataQuick Information Systems and continued to outperform the broader housing and mortgage markets during first-quarter 2014, according to Nallathambi. He said the firm's Q1 financial results were in line with its expectations.