Doma Delivers at High End of 2021 Guidance on Retained Premiums and Fees, and Exceeds Guidance on Adjusted Growth Profit
Fourth quarter includes successful expansion of core machine intelligence-powered title and closing offering into purchase transactions within Local channel
Provides Growth and Margin Outlook for FY 2022
Fourth Quarter 2021 Business Highlights(1):
-
Total revenues of
$138 million , up 17% versus Q4 2020 -
Retained premiums and fees of
$66 million , up 24% versus Q4 2020 -
Gross profit of
$22 million , down 10% versus Q4 2020 -
Adjusted gross profit of
$25 million , down 9% versus Q4 2020 - Closed orders up 35% versus Q4 2020, Enterprise closed orders up 296% versus Q4 2020
- Open orders up 21% versus Q4 2020
“Our referral partners’ receptivity to our offering, and the Doma team’s ability to execute with a high degree of skill has fortified our pursuit of becoming the unquestioned leader in our industry,” said
Doma remains committed to strategic investment in growth in order to accelerate and secure its leadership position in the industry. Doma's key strategic initiatives for 2022 include an acceleration of investments across its home purchase platform. Investments will take the form of investing in customer acquisition and go-to-market delivery, migration of purchase transactions to the Doma Intelligence platform, new product functionality, and opportunities to expand into adjacent markets.
|
(1) |
Reconciliations of retained premiums and fees, adjusted gross profit, and the other financial measures used in this press release that are not calculated in accordance with generally accepted accounting principles in |
|
|
(2) |
Doma completed its business combination with |
Fourth Quarter 2021 Growth Drivers and Recent Business Highlights
- Successful launch of purchase transactions on the Doma Intelligence platform in December, delivering on one of the Company's key commitments for 2021. Given the recent rise in lending rates and an accelerated drop-off in mortgage refinances, Doma will aggressively pursue the migration of purchase transactions from the Local business to the Doma Intelligence platform, further enabling the real estate professionals, lenders, independent title agents and homeowners Doma works with to all benefit from closings that are faster, higher quality, and more affordable.
- 296% year over year closed order growth from Doma Enterprise, despite a 59% decline in the overall refinance market. Total order growth in the fourth quarter was propelled by the addition of several new Enterprise referral partners that include another top 10 national mortgage lender, a leading provider of innovative home equity products, and a technology-led non-bank originator, as well as increases in wallet share from existing referral partners, reflecting confidence in Doma's technology by the nation's largest mortgage lenders.
- Home purchase transaction volume increased by a healthy 4% over the same period in 2020, outpacing market contraction in purchase of 8%.
-
Continued improvements to the Doma Intelligence platform helped deliver better customer outcomes through the application of cutting-edge machine learning technology.
- Added more transparency for co-signers within the Doma Close product which allows homeowners to review and eSign about 50% of documents prior to the in-person signing, making the overall experience less daunting and stressful.
- Added new capabilities within Doma Escrow for payoff parsing, policy automation, and automated funding disbursement that all help to further expedite the final stages of closing and drive faster payouts to the parties involved.
-
Expansion of the Doma Intelligence platform in the States of
Washington ,Maine , andMississippi , bringing total coverage to approximately 83% of US residential real estate market based on gross written premium.
2022 Full Year Outlook (1):
-
GAAP Financial Measures
-
For the full year, Doma expects gross profit of between
$118 million and$136 million
-
For the full year, Doma expects gross profit of between
-
Non-GAAP Financial Measures
-
Doma expects retained premiums and fees of between
$300 million and$320 million - Doma expects ratio of adjusted gross profit to retained premiums and fees between 44% and 47%
-
Doma expects adjusted EBITDA between negative
$90 million and negative$70 million - Doma intends to reach adjusted EBITDA positive in 2023
-
Doma expects retained premiums and fees of between
Non-GAAP Financial Measures
Some of the financial information and data contained in this press release, such as retained premiums and fees, adjusted gross profit and adjusted EBITDA, have not been prepared in accordance with
Conference Call Information
Doma will host a conference call at
The telephonic version of the call can be accessed by dialing:
Participant Toll Free Dial-In Number: (844) 615-6508
Participant International Dial-In Number: (918) 922-3146
Conference ID: 7967607
The live webcast of the call will be accessible on the Company’s website at investor.doma.com. Approximately two hours after conclusion of the live event, an archived webcast of the conference call will be accessible from the Investor Relations section of the Company’s website for twelve months.
About
Doma (NYSE: DOMA) is architecting the future of real estate transactions. The Company uses machine intelligence and its proprietary technology solutions to transform residential real estate, making closings instant and affordable. Doma and its family of brands – States Title,
Forward-Looking Statements Legend
This press release includes “forward-looking statements” within the meaning of the “safe harbor” provisions of the United States Private Securities Litigation Reform Act of 1995. Forward-looking statements may be identified by the use of words such as "estimate," "plan," "project," "forecast," "intend," "will," "expect," "anticipate," "believe," "seek," "target" or other similar expressions that predict or indicate future events or trends or that are not statements of historical matters. The absence of these words does not mean that a statement is not forward-looking. Such statements are based on the beliefs of, as well as assumptions made by information currently available to Doma management. These forward-looking statements include, but are not limited to, statements regarding estimates and forecasts of financial and performance metrics, projections of market opportunity, total addressable market ("TAM"), market share and competition. These statements are based on various assumptions, whether or not identified in this press release, and on the current expectation of Doma’s management and are not predictions of actual performance. These forward-looking statements are provided for illustrative purposes only and are not intended to serve as, and must not be relied on by any investor as, a guarantee, an assurance, a prediction or a definitive statement of fact or probability. Actual events and circumstances are difficult or impossible to predict, will differ from assumptions and are beyond the control of Doma.
These forward-looking statements are subject to a number of risks and uncertainties, including changes in business, market, financial, political and legal conditions; risks relating to the uncertainty of the projected financial information with respect to Doma; future global, regional or local economic, political, market and social conditions, including due to the COVID-19 pandemic; the development, effects and enforcement of laws and regulations, including with respect to the title insurance industry; Doma’s ability to manage its future growth or to develop or acquire enhancements to its platform; the effects of competition on Doma’s future business; the outcome of any potential litigation, government and regulatory proceedings, investigations and inquiries; and those other factors described in the "Risk Factors" section of the documents filed by Doma from time to time with the
If any of these risks materialize or Doma’s assumptions prove incorrect, actual results could differ materially from the results implied by these forward-looking statements. There may be additional risks that Doma does not presently know or that Doma currently believes are immaterial that could also cause actual results to differ from those contained in the forward-looking statements. In addition, forward-looking statements reflect Doma’s expectations, plans or forecasts of future events and views as of the date of this press release. Doma anticipates that subsequent events and developments will cause Doma’s assessments to change. However, while Doma may elect to update these forward-looking statements at some point in the future, Doma specifically disclaims any obligation to do so, except as required by law. These forward-looking statements should not be relied upon as representing Doma’s assessment as of any date subsequent to the date of this press release. Accordingly, undue reliance should not be placed upon the forward-looking statements.
|
Key Operating and Financial Indicators |
|||||||||||||||
|
|
Three Months Ended |
|
Year ended |
||||||||||||
|
|
|
2021 |
|
|
|
2020 |
|
|
|
2021 |
|
|
|
2020 |
|
|
|
(in thousands, except for open and closed order numbers) |
||||||||||||||
|
Key operating data: |
|
|
|
|
|
|
|
||||||||
|
Opened orders |
|
43,247 |
|
|
|
35,712 |
|
|
|
178,689 |
|
|
|
136,873 |
|
|
Closed orders |
|
37,042 |
|
|
|
27,363 |
|
|
|
136,428 |
|
|
|
92,389 |
|
|
|
|
|
|
|
|
|
|
||||||||
|
GAAP financial data: |
|
|
|
|
|
|
|
||||||||
|
Revenue (1) |
$ |
137,679 |
|
|
$ |
117,510 |
|
|
$ |
558,043 |
|
|
$ |
409,814 |
|
|
Gross profit (2) |
$ |
22,031 |
|
|
$ |
24,412 |
|
|
$ |
103,261 |
|
|
$ |
85,830 |
|
|
Net loss |
$ |
(43,729 |
) |
|
$ |
(8,563 |
) |
|
$ |
(113,056 |
) |
|
$ |
(35,103 |
) |
|
Non-GAAP financial data (3): |
|
|
|
|
|
|
|
||||||||
|
Retained premiums and fees |
$ |
66,349 |
|
|
$ |
53,499 |
|
|
$ |
259,598 |
|
|
$ |
189,671 |
|
|
Adjusted gross profit |
$ |
24,646 |
|
|
$ |
26,991 |
|
|
$ |
113,582 |
|
|
$ |
91,645 |
|
|
Ratio of adjusted gross profit to retained premiums and fees |
|
37 |
% |
|
|
50 |
% |
|
|
44 |
% |
|
|
48 |
% |
|
Adjusted EBITDA |
$ |
(36,303 |
) |
|
$ |
(3,060 |
) |
|
$ |
(71,592 |
) |
|
$ |
(18,986 |
) |
|
|
|
|
|
|
|
|
|
||||||||
| _________________ | ||
| n.m. = not meaningful | ||
|
(1) |
Revenue is comprised of (i) net premiums written, (ii) escrow, other title-related fees and other, and (iii) investment, dividend and other income. Net loss is made up of the components of revenue and expenses. |
|
|
(2) |
Gross profit, calculated in accordance with GAAP, is calculated as total revenue, minus premiums retained by third-party agents, direct labor expense (including mainly personnel expense for certain employees involved in the direct fulfillment of policies) and direct non-labor expense (including mainly title examination expense, provision for claims, and depreciation and amortization). In our consolidated income statements, depreciation and amortization is recorded under the “other operating expenses” caption. |
|
|
(3) |
Retained premiums and fees, adjusted gross profit and adjusted EBITDA are non-GAAP financial measures. |
|
Non-GAAP Financial Measures
Retained premiums and fees
The following table reconciles our retained premiums and fees to our gross profit, the most closely comparable GAAP financial measure, for the periods indicated:
|
|
Three Months Ended |
|
Year ended |
||||||||
|
|
2021 |
|
2020 |
|
2021 |
|
2020 |
||||
|
|
(in thousands) |
|
(in thousands) |
||||||||
|
Revenue |
$ |
137,679 |
|
$ |
117,510 |
|
$ |
558,043 |
|
$ |
409,814 |
|
Minus: |
|
|
|
|
|
|
|
||||
|
Premiums retained by third-party agents |
|
71,330 |
|
|
64,011 |
|
|
298,445 |
|
|
220,143 |
|
Retained premiums and fees |
$ |
66,349 |
|
$ |
53,499 |
|
$ |
259,598 |
|
$ |
189,671 |
|
Minus: |
|
|
|
|
|
|
|
||||
|
Direct labor |
|
26,787 |
|
|
17,050 |
|
|
89,616 |
|
|
62,154 |
|
Provision for claims |
|
4,594 |
|
|
5,272 |
|
|
21,335 |
|
|
15,337 |
|
Depreciation and amortization |
|
2,615 |
|
|
2,579 |
|
|
10,321 |
|
|
5,815 |
|
Other direct costs (1) |
|
10,322 |
|
|
4,186 |
|
|
35,065 |
|
|
20,535 |
|
Gross Profit |
$ |
22,031 |
|
$ |
24,412 |
|
$ |
103,261 |
|
$ |
85,830 |
| __________________ | ||
|
(1) |
Includes title examination expense, office supplies, and premium and other taxes. |
|
Adjusted gross profit
The following table reconciles our adjusted gross profit to our gross profit, the most closely comparable GAAP financial measure, for the periods indicated:
|
|
Three Months Ended |
|
Year ended |
||||||||
|
|
2021 |
|
2020 |
|
2021 |
|
2020 |
||||
|
|
(in thousands) |
|
(in thousands) |
||||||||
|
Gross Profit |
$ |
22,031 |
|
$ |
24,412 |
|
$ |
103,261 |
|
$ |
85,830 |
|
Adjusted for: |
|
|
|
|
|
|
|
||||
|
Depreciation and amortization |
|
2,615 |
|
|
2,579 |
|
|
10,321 |
|
|
5,815 |
|
Adjusted Gross Profit |
$ |
24,646 |
|
$ |
26,991 |
|
$ |
113,582 |
|
$ |
91,645 |
Adjusted EBITDA
The following table reconciles our adjusted EBITDA to our net loss, the most closely comparable GAAP financial measure, for the periods indicated:
|
|
Three Months Ended |
|
Year ended |
||||||||||||
|
|
|
2021 |
|
|
|
2020 |
|
|
|
2021 |
|
|
|
2020 |
|
|
|
(in thousands) |
|
(in thousands) |
||||||||||||
|
Net loss (GAAP) |
$ |
(43,729 |
) |
|
$ |
(8,563 |
) |
|
$ |
(113,056 |
) |
|
$ |
(35,103 |
) |
|
Adjusted for: |
|
|
|
|
|
|
|
||||||||
|
Depreciation and amortization |
|
2,615 |
|
|
|
2,579 |
|
|
|
10,321 |
|
|
|
5,815 |
|
|
Interest expense |
|
4,519 |
|
|
|
1,151 |
|
|
|
16,861 |
|
|
|
5,579 |
|
|
Income taxes |
|
421 |
|
|
|
223 |
|
|
|
927 |
|
|
|
843 |
|
|
EBITDA |
$ |
(36,174 |
) |
|
$ |
(4,610 |
) |
|
$ |
(84,947 |
) |
|
$ |
(22,866 |
) |
|
Adjusted for: |
|
|
|
|
|
|
|
||||||||
|
Stock-based compensation |
|
11,040 |
|
|
|
1,550 |
|
|
|
20,046 |
|
|
|
2,495 |
|
|
COVID-related severance costs |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
1,385 |
|
|
Change in fair value of Warrant and Sponsor Covered shares liabilities |
|
(11,169 |
) |
|
|
— |
|
|
|
(6,691 |
) |
|
|
— |
|
|
Adjusted EBITDA |
$ |
(36,303 |
) |
|
$ |
(3,060 |
) |
|
$ |
(71,592 |
) |
|
$ |
(18,986 |
) |
The following table reconciles our adjusted gross profit to our adjusted EBITDA, for the periods indicated:
|
|
Three Months Ended |
|
Year ended |
||||||||||||
|
|
|
2021 |
|
|
|
2020 |
|
|
|
2021 |
|
|
|
2020 |
|
|
|
(in thousands) |
|
(in thousands) |
||||||||||||
|
Adjusted Gross Profit |
$ |
24,646 |
|
|
$ |
26,991 |
|
|
$ |
113,582 |
|
|
$ |
91,645 |
|
|
Minus: |
|
|
|
|
|
|
|
||||||||
|
Customer acquisition costs |
|
18,251 |
|
|
|
9,252 |
|
|
|
55,208 |
|
|
|
34,482 |
|
|
Other indirect costs (1) |
|
42,698 |
|
|
|
20,799 |
|
|
|
129,966 |
|
|
|
76,149 |
|
|
Adjusted EBITDA |
$ |
(36,303 |
) |
|
$ |
(3,060 |
) |
|
$ |
(71,592 |
) |
|
$ |
(18,986 |
) |
| __________________ | ||
|
(1) |
Includes corporate support, research and development, and other operating costs. |
|
Outlook reconciliations
The following tables reconcile the ranges of expected retained premiums and fees to expected gross profit and the ranges expected adjusted gross profit to expected gross profit, which, in each case, is the most comparable GAAP measure, for the full year ended
|
|
Year Ended |
||||||
|
|
Low |
|
High |
||||
|
|
(in thousands) |
||||||
|
Retained premiums and fees |
$ |
300,000 |
|
$ |
320,000 |
||
|
Minus: |
|
|
|
||||
|
Estimated adjustments (1) |
$ |
182,000 |
|
$ |
184,000 |
||
|
Gross Profit |
$ |
118,000 |
|
$ |
136,000 |
||
|
|
Year Ended |
||||||
|
|
Low |
|
High |
||||
|
|
(in thousands) |
||||||
|
Gross Profit |
$ |
118,000 |
|
|
$ |
136,000 |
|
|
Adjusted for: |
|
|
|
||||
|
Depreciation and amortization |
|
14,000 |
|
|
|
14,000 |
|
|
Adjusted Gross Profit |
$ |
132,000 |
|
|
$ |
150,000 |
|
|
|
|
|
|
||||
|
Outlook for Other Key Operating Indicators |
|
|
|
||||
|
Ratio of adjusted gross profit to retained premiums and fees |
|
44 |
% |
|
|
47 |
% |
|
Adjusted EBITDA |
$ |
(90,000 |
) |
|
$ |
(70,000 |
) |
With respect to our guidance on adjusted EBITDA, the Company is not able to provide a quantitative reconciliation without unreasonable efforts to the most directly comparable GAAP financial measure, which would be net loss, due to the high variability, complexity and low visibility with respect to certain items such as income taxes and changes in the fair value of Warrant and Sponsor Covered shares liabilities. We expect the variability of these items to have a potentially unpredictable and potentially significant impact on future GAAP financial results, and, as such, we also believe that any reconciliations provided would imply a degree of precision that would be confusing or misleading to investors.
| __________________ | ||
|
(1) |
Estimated adjustments include direct labor, provision for claims, depreciation and amortization, and other direct costs (which includes title examination expense, office supplies, and premium and other taxes). |
|
|
|
|||||||||||
|
Consolidated Statements of Operations |
|||||||||||
|
|
Year ended |
||||||||||
|
(In thousands, except share and per share information) |
|
2021 |
|
|
|
2020 |
|
|
|
2019 |
|
|
Revenues: |
|
|
|
|
|
||||||
|
Net premiums written (1) |
$ |
475,352 |
|
|
$ |
345,608 |
|
|
$ |
292,707 |
|
|
Escrow, other title-related fees and other |
|
79,585 |
|
|
|
61,275 |
|
|
|
62,017 |
|
|
Investment, dividend and other income |
|
3,106 |
|
|
|
2,931 |
|
|
|
3,361 |
|
|
Total revenues |
$ |
558,043 |
|
|
$ |
409,814 |
|
|
$ |
358,085 |
|
|
|
|
|
|
|
|
||||||
|
Expenses: |
|
|
|
|
|
||||||
|
Premiums retained by Third-Party Agents (2) |
$ |
298,445 |
|
|
$ |
220,143 |
|
|
$ |
178,265 |
|
|
Title examination expense |
|
22,137 |
|
|
|
16,204 |
|
|
|
14,383 |
|
|
Provision for claims |
|
21,335 |
|
|
|
15,337 |
|
|
|
12,285 |
|
|
Personnel costs |
|
238,134 |
|
|
|
143,526 |
|
|
|
130,876 |
|
|
Other operating expenses |
|
79,951 |
|
|
|
43,285 |
|
|
|
39,744 |
|
|
Total operating expenses |
$ |
660,002 |
|
|
$ |
438,495 |
|
|
$ |
375,553 |
|
|
|
|
|
|
|
|
||||||
|
Loss from operations |
$ |
(101,959 |
) |
|
$ |
(28,681 |
) |
|
$ |
(17,468 |
) |
|
|
|
|
|
|
|
||||||
|
Other (expense) income: |
|
|
|
|
|
||||||
|
Change in fair value of Warrant and Sponsor Covered Shares liabilities |
|
6,691 |
|
|
|
— |
|
|
|
— |
|
|
Interest expense |
|
(16,861 |
) |
|
|
(5,579 |
) |
|
|
(9,282 |
) |
|
Loss before income taxes |
$ |
(112,129 |
) |
|
$ |
(34,260 |
) |
|
$ |
(26,750 |
) |
|
|
|
|
|
|
|
||||||
|
Income tax expense |
|
(927 |
) |
|
|
(843 |
) |
|
|
(387 |
) |
|
Net loss |
$ |
(113,056 |
) |
|
$ |
(35,103 |
) |
|
$ |
(27,137 |
) |
|
|
|
|
|
|
|
||||||
|
Earnings per share: |
|
|
|
|
|
||||||
|
Net loss per share attributable to stockholders - basic and diluted |
$ |
(0.64 |
) |
|
$ |
(0.56 |
) |
|
$ |
(0.45 |
) |
|
Weighted average shares outstanding common stock - basic and diluted |
|
177,150,914 |
|
|
|
62,458,039 |
|
|
|
60,314,163 |
|
| __________________ | ||
|
(1) |
Net premiums written includes revenues from a related party of |
|
|
(2) |
Premiums retained by Third-Party Agents includes expenses associated with a related party of |
|
|
|
|||||||
|
Consolidated Balance Sheets |
|||||||
|
|
|
||||||
|
(In thousands, except share information) |
|
2021 |
|
|
|
2020 |
|
|
Assets |
|
|
|
||||
|
Cash and cash equivalents |
$ |
379,702 |
|
|
$ |
111,893 |
|
|
Restricted cash |
|
4,126 |
|
|
|
129 |
|
|
Investments: |
|
|
|
||||
|
Fixed maturities |
|
|
|
||||
|
Held-to-maturity debt securities, at amortized cost |
|
67,164 |
|
|
|
65,406 |
|
|
Available-for-sale debt securities, at fair value (amortized cost |
|
— |
|
|
|
8,057 |
|
|
Equity securities, at fair value (cost |
|
— |
|
|
|
2,119 |
|
|
Mortgage loans |
|
2,022 |
|
|
|
2,980 |
|
|
Other invested assets |
|
325 |
|
|
|
— |
|
|
Total investments |
$ |
69,511 |
|
|
$ |
78,562 |
|
|
Receivables (net of provision for doubtful accounts of |
|
15,498 |
|
|
|
15,244 |
|
|
Prepaid expenses, deposits and other assets |
|
15,692 |
|
|
|
7,365 |
|
|
Fixed assets (net of accumulated depreciation of |
|
45,953 |
|
|
|
21,661 |
|
|
Title plants |
|
13,952 |
|
|
|
14,008 |
|
|
|
|
111,487 |
|
|
|
111,487 |
|
|
Trade names (net of accumulated amortization of |
|
— |
|
|
|
2,684 |
|
|
Total assets |
$ |
655,921 |
|
|
$ |
363,033 |
|
|
|
|
|
|
||||
|
Liabilities and stockholders’ equity |
|
|
|
||||
|
Accounts payable |
$ |
6,930 |
|
|
$ |
6,626 |
|
|
Accrued expenses and other liabilities |
|
54,149 |
|
|
|
33,044 |
|
|
Senior secured credit agreement, net of debt issuance costs and original issue discount |
|
141,769 |
|
|
|
— |
|
|
Loan from a related party |
|
— |
|
|
|
65,532 |
|
|
Liability for loss and loss adjustment expenses |
|
80,267 |
|
|
|
69,800 |
|
|
Warrant liabilities |
|
16,467 |
|
|
|
— |
|
|
Sponsor Covered Shares liability |
|
5,415 |
|
|
|
— |
|
|
Total liabilities |
$ |
304,997 |
|
|
$ |
175,002 |
|
|
|
|
|
|
||||
|
Stockholders’ equity: |
|
|
|
||||
|
Series A preferred stock, 0.0001 par value; 0 shares authorized at |
$ |
— |
|
|
$ |
1 |
|
|
Series A-1 preferred stock, 0.0001 par value; 0 shares authorized at |
|
— |
|
|
|
1 |
|
|
Series A-2 preferred stock, 0.0001 par value; 0 shares authorized at |
|
— |
|
|
|
— |
|
|
Series B preferred stock, 0.0001 par value; 0 shares authorized at |
|
— |
|
|
|
— |
|
|
Series C preferred stock, 0.0001 par value; 0 shares authorized at |
|
— |
|
|
|
1 |
|
|
Common stock, 0.0001 par value; 2,000,000,000 shares authorized at |
|
33 |
|
|
|
1 |
|
|
Additional paid-in capital |
|
543,070 |
|
|
|
266,464 |
|
|
Accumulated deficit |
|
(192,179 |
) |
|
|
(79,123 |
) |
|
Accumulated other comprehensive income |
|
— |
|
|
|
686 |
|
|
Total stockholders’ equity |
$ |
350,924 |
|
|
$ |
188,031 |
|
|
Total liabilities and stockholders’ equity |
$ |
655,921 |
|
|
$ |
363,033 |
|
Quarterly Results of Operations and Other Data
The following tables set forth our selected unaudited quarterly consolidated statements of operations data for each of the quarters indicated. The information for each quarter has been prepared on a basis consistent with our audited consolidated financial statements, and reflect, in the opinion of management, all adjustments, which consist only of a normal, recurring nature that are necessary for a fair statement of the financial information contained in those financial statements. Our historical results are not necessarily indicative of the results that may be expected in the future. The following quarterly financial data should be read in conjunction with our consolidated financial statements.
Consolidated Statements of Operations
|
|
Three months ended |
||||||||||||||||||||||||||||||
|
(In thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
|
Revenues: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
|
Net premiums written |
$ |
56,817 |
|
|
$ |
86,334 |
|
|
$ |
103,587 |
|
|
$ |
98,870 |
|
|
$ |
107,992 |
|
|
$ |
109,271 |
|
|
$ |
141,491 |
|
|
$ |
116,598 |
|
|
Escrow, other title-related fees and other |
|
13,174 |
|
|
|
13,382 |
|
|
|
16,742 |
|
|
|
17,977 |
|
|
|
18,575 |
|
|
|
20,065 |
|
|
|
20,452 |
|
|
|
20,493 |
|
|
Investment, dividend and other income |
|
818 |
|
|
|
707 |
|
|
|
743 |
|
|
|
663 |
|
|
|
1,229 |
|
|
|
650 |
|
|
|
639 |
|
|
|
588 |
|
|
Total revenues |
$ |
70,809 |
|
|
$ |
100,423 |
|
|
$ |
121,072 |
|
|
$ |
117,510 |
|
|
$ |
127,796 |
|
|
$ |
129,986 |
|
|
$ |
162,582 |
|
|
$ |
137,679 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
|
Expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
|
Premiums retained by Third-Party Agents |
$ |
33,102 |
|
|
$ |
56,006 |
|
|
$ |
67,024 |
|
|
$ |
64,011 |
|
|
$ |
70,338 |
|
|
$ |
65,181 |
|
|
$ |
91,596 |
|
|
$ |
71,330 |
|
|
Title examination expense |
|
3,865 |
|
|
|
3,322 |
|
|
|
4,624 |
|
|
|
4,393 |
|
|
|
4,853 |
|
|
|
5,500 |
|
|
|
5,289 |
|
|
|
6,495 |
|
|
Provision for claims |
|
1,783 |
|
|
|
3,040 |
|
|
|
5,242 |
|
|
|
5,272 |
|
|
|
3,249 |
|
|
|
6,807 |
|
|
|
6,685 |
|
|
|
4,594 |
|
|
Personnel costs |
|
35,718 |
|
|
|
32,737 |
|
|
|
36,197 |
|
|
|
38,874 |
|
|
|
43,464 |
|
|
|
53,954 |
|
|
|
62,410 |
|
|
|
78,306 |
|
|
Other operating expenses |
|
10,640 |
|
|
|
10,286 |
|
|
|
10,210 |
|
|
|
12,149 |
|
|
|
14,165 |
|
|
|
17,181 |
|
|
|
21,693 |
|
|
|
26,912 |
|
|
Total operating expenses |
$ |
85,108 |
|
|
$ |
105,391 |
|
|
$ |
123,297 |
|
|
$ |
124,699 |
|
|
$ |
136,069 |
|
|
$ |
148,623 |
|
|
$ |
187,673 |
|
|
$ |
187,637 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
|
Loss from operations |
$ |
(14,299 |
) |
|
$ |
(4,968 |
) |
|
$ |
(2,225 |
) |
|
$ |
(7,189 |
) |
|
$ |
(8,273 |
) |
|
$ |
(18,637 |
) |
|
$ |
(25,091 |
) |
|
$ |
(49,958 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
|
Other income (expense): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
|
Change in fair value of warrant and Sponsor Covered Shares liabilities |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(4,478 |
) |
|
|
11,169 |
|
|
Interest expense |
|
(2,112 |
) |
|
|
(1,123 |
) |
|
|
(1,193 |
) |
|
|
(1,151 |
) |
|
|
(3,360 |
) |
|
|
(4,451 |
) |
|
|
(4,531 |
) |
|
|
(4,519 |
) |
|
Loss before income taxes |
$ |
(16,411 |
) |
|
$ |
(6,091 |
) |
|
$ |
(3,418 |
) |
|
$ |
(8,340 |
) |
|
$ |
(11,633 |
) |
|
$ |
(23,088 |
) |
|
$ |
(34,100 |
) |
|
$ |
(43,308 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
|
Income tax expense |
|
(175 |
) |
|
|
(241 |
) |
|
|
(204 |
) |
|
|
(223 |
) |
|
|
(125 |
) |
|
|
(211 |
) |
|
|
(170 |
) |
|
|
(421 |
) |
|
Net loss |
|
(16,586 |
) |
|
|
(6,332 |
) |
|
|
(3,622 |
) |
|
|
(8,563 |
) |
|
|
(11,758 |
) |
|
|
(23,299 |
) |
|
|
(34,270 |
) |
|
|
(43,729 |
) |
Reconciliation of GAAP to Non-GAAP Measures
The following tables present our reconciliation of GAAP measures to non-GAAP measures for the historical periods indicated.
Retained premiums and fees
|
|
Three Months Ended |
||||||||||||||||||||||
|
(In thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
Revenue |
$ |
70,809 |
|
$ |
100,423 |
|
$ |
121,072 |
|
$ |
117,510 |
|
$ |
127,796 |
|
$ |
129,986 |
|
$ |
162,582 |
|
$ |
137,679 |
|
Minus: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
Premiums retained by Third-Party Agents |
|
33,102 |
|
|
56,006 |
|
|
67,024 |
|
|
64,011 |
|
|
70,338 |
|
|
65,181 |
|
|
91,596 |
|
|
71,330 |
|
Retained premiums and fees |
$ |
37,707 |
|
$ |
44,417 |
|
$ |
54,048 |
|
$ |
53,499 |
|
$ |
57,458 |
|
$ |
64,805 |
|
$ |
70,986 |
|
$ |
66,349 |
|
Minus: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
Direct labor |
|
16,314 |
|
|
13,898 |
|
|
14,892 |
|
|
17,050 |
|
|
17,979 |
|
|
20,902 |
|
|
23,948 |
|
|
26,787 |
|
Provision for claims |
|
1,783 |
|
|
3,040 |
|
|
5,242 |
|
|
5,272 |
|
|
3,249 |
|
|
6,807 |
|
|
6,685 |
|
|
4,594 |
|
Depreciation and amortization |
|
1,116 |
|
|
899 |
|
|
1,221 |
|
|
2,579 |
|
|
2,707 |
|
|
3,021 |
|
|
1,978 |
|
|
2,615 |
|
Other direct costs(1) |
|
5,137 |
|
|
4,898 |
|
|
6,314 |
|
|
4,186 |
|
|
7,109 |
|
|
7,561 |
|
|
10,073 |
|
|
10,322 |
|
Gross Profit |
$ |
13,357 |
|
$ |
21,682 |
|
$ |
26,379 |
|
$ |
24,412 |
|
$ |
26,414 |
|
$ |
26,514 |
|
$ |
28,302 |
|
$ |
22,031 |
| __________________ | ||
|
(1) |
Includes title examination expense, office supplies, and premium and other taxes. |
|
Adjusted gross profit
|
|
Three Months Ended |
||||||||||||||||||||||
|
(in thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
Gross Profit |
$ |
13,357 |
|
$ |
21,682 |
|
$ |
26,379 |
|
$ |
24,412 |
|
$ |
26,414 |
|
$ |
26,514 |
|
$ |
28,302 |
|
$ |
22,031 |
|
Adjusted for: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
Depreciation and amortization |
|
1,116 |
|
|
899 |
|
|
1,221 |
|
|
2,579 |
|
|
2,707 |
|
|
3,021 |
|
|
1,978 |
|
|
2,615 |
|
Adjusted Gross Profit |
$ |
14,473 |
|
$ |
22,581 |
|
$ |
27,600 |
|
$ |
26,991 |
|
$ |
29,121 |
|
$ |
29,535 |
|
$ |
30,280 |
|
$ |
24,646 |
Adjusted EBITDA
|
|
Three Months Ended |
||||||||||||||||||||||||||||||
|
(in thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
|
Net loss (GAAP) |
$ |
(16,586 |
) |
|
$ |
(6,332 |
) |
|
$ |
(3,622 |
) |
|
$ |
(8,563 |
) |
|
$ |
(11,758 |
) |
|
$ |
(23,299 |
) |
|
$ |
(34,270 |
) |
|
$ |
(43,729 |
) |
|
Adjusted for: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
|
Depreciation and amortization |
|
1,116 |
|
|
|
899 |
|
|
|
1,221 |
|
|
|
2,579 |
|
|
|
2,707 |
|
|
|
3,021 |
|
|
|
1,978 |
|
|
|
2,615 |
|
|
Interest expense |
|
2,112 |
|
|
|
1,123 |
|
|
|
1,193 |
|
|
|
1,151 |
|
|
|
3,360 |
|
|
|
4,451 |
|
|
|
4,531 |
|
|
|
4,519 |
|
|
Income taxes |
|
175 |
|
|
|
241 |
|
|
|
204 |
|
|
|
223 |
|
|
|
125 |
|
|
|
211 |
|
|
|
170 |
|
|
|
421 |
|
|
EBITDA |
$ |
(13,183 |
) |
|
$ |
(4,069 |
) |
|
$ |
(1,004 |
) |
|
$ |
(4,610 |
) |
|
$ |
(5,566 |
) |
|
$ |
(15,616 |
) |
|
$ |
(27,591 |
) |
|
$ |
(36,174 |
) |
|
Adjusted for: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
|
Stock-based compensation |
|
308 |
|
|
|
282 |
|
|
|
355 |
|
|
|
1,550 |
|
|
|
2,289 |
|
|
|
3,713 |
|
|
|
3,004 |
|
|
|
11,040 |
|
|
COVID-related severance costs |
|
— |
|
|
|
1,385 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
Change in fair value of warrant and Sponsor Covered Shares liabilities |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
4,478 |
|
|
|
(11,169 |
) |
|
Adjusted EBITDA |
$ |
(12,875 |
) |
|
$ |
(2,402 |
) |
|
$ |
(649 |
) |
|
$ |
(3,060 |
) |
|
$ |
(3,277 |
) |
|
$ |
(11,903 |
) |
|
$ |
(20,109 |
) |
|
$ |
(36,303 |
) |
View source version on businesswire.com: https://www.businesswire.com/news/home/20220217005373/en/
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