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8-K - FORM 8-K - Black Knight InfoServ, LLCg27748e8vk.htm
EX-99.2 - EX-99.2 - Black Knight InfoServ, LLCg27748exv99w2.htm
Exhibit 99.1
(LPS LOGO)
Press Release
     
Investors:
  Media:
 
   
Parag Bhansali
  Michelle Kersch
(904) 854-8640
  (904) 854-5043
Lender Processing Services, Inc. Reports Second Quarter 2011 Earnings
Adjusted EPS of 56 cents per diluted share in 2Q11
     JACKSONVILLE, Fla. — July 25, 2011 — Lender Processing Services, Inc. (NYSE:LPS), a leading provider of integrated technology and services to the mortgage and real estate industries, today reported consolidated revenues of $517.5 million for the second quarter of 2011, a decrease of 12.8% compared to the second quarter of 2010, while net earnings of $21.4 million or 25 cents per diluted share in the second quarter of 2011 compared to $80.4 million or 85 cents per diluted share in the prior year quarter.
     The company noted that, in light of current market conditions, it continues to evaluate its cost structure as well as potentially underperforming assets. As a result, the company recognized a pre-tax restructuring charge of $7.9 million during the quarter primarily relating to continued personnel reductions. Also, the company recognized a $31.8 million pre-tax asset impairment charge ($26.6 million for certain services now classified as discontinued operations and $5.2 million in continuing operations) relating to the write-down of certain investments that the company is evaluating for potential sale or wind down.
     Adjusted net earnings for the second quarter of 2011 were $48.0 million, or 56 cents per diluted share, compared to $84.0 million, or 89 cents per diluted share in the second quarter of 2010. Adjusted net earnings in the current quarter excluded the following charges: 18 cents per

 


 

diluted share for asset impairment charges relating to discontinued operations, 6 cents per diluted share primarily relating to cost reduction initiatives and 4 cents per diluted share for asset impairment charges relating to continuing operations. Also, the current quarter included an adjustment for purchase price amortization of 3 cents per diluted share while the second quarter of 2010 included a similar adjustment of 4 cents per diluted share.
     “LPS continues to perform well despite very challenging conditions in the default and origination markets, as well as an ongoing difficult macro-economic environment. LPS, with its strong market presence and unique set of end-to-end solutions for the mortgage and real estate marketplace, remains well-positioned for the years ahead,” said Lee A. Kennedy, Chairman and interim CEO of LPS.
     “Our Default Services and Loan Facilitation businesses continued to be impacted by lower industry volumes, however, our Mortgage Processing business had a good quarter while our Other TD&A businesses posted strong growth from continued market share gains,” continued Lee A. Kennedy.
     Operating income of $72.2 million in the second quarter of 2011 compared to $148.4 million in the prior year period. Adjusting for the charges noted earlier, operating income was $85.4 million in the second quarter of 2011.
     Net cash provided by operating activities for the first half of 2011 was $226.9 million compared to $206.7 million for the same period last year. Adjusted free cash flow (net cash provided by operating activities minus certain non-recurring charges and additions to property, equipment and computer software) for the first half of 2011 was $183.0 million compared to $149.5 million for the first half of 2010 and was higher primarily due to contributions from changes in working capital.

 


 

Technology, Data and Analytics (TD&A)
     Revenues for the segment were $195.3 million compared to $179.8 million in the second quarter of 2010, while operating income of $58.2 million (excluding the charges noted earlier) compared to $64.8 million in the prior year quarter. Mortgage Processing revenues of $102.8 million compared to $102.4 million in the same period last year. Other TD&A revenues of $92.6 million were 19.5% above the second quarter of 2010 primarily due to strong growth in Desktop, as well as higher Data & Analytics revenues. Overall operating income for TD&A was lower compared to the second quarter of 2010 primarily due to lower income in our Other Software and Services offerings partly offset by higher contributions from Data & Analytics and Desktop.
Loan Transaction Services (LTS)
     Revenues for the segment were $323.7 million compared to $415.5 million in the second quarter of 2010, and operating income of $58.9 million (excluding the charges noted earlier) compared to $101.6 million in the prior year period. Loan Facilitation Services revenues of $113.4 million declined 19.3% compared to the second quarter of 2010 due to lower industry volumes. Default Services revenues of $210.3 million declined 23.5% compared to the same period last year as a result of continued delays in the initiation of foreclosure proceedings in the industry. This result compared favorably to RealtyTrac’s report of a 36.6% decline in Default Notices compared to the prior year quarter. This positive variance was primarily due to continued market share gains in our default title business. Overall operating income for LTS declined mainly due to lower contributions from Loan Facilitation Services and to a lesser extent from Default Services.
Corporate and Other
     Net corporate expenses were $33.9 million in the second quarter of 2011. Excluding the charges noted earlier, net corporate expenses of $31.7 million compared to $18.0 million in the second quarter of 2010 and were up primarily due to higher legal and compliance related expenses.

 


 

     The company noted that it had repurchased 2.0 million shares for $53.0 million and $5.0 million of its public bonds in the second quarter. Following these purchases, $95.1 million remains available under the current authorization.
Outlook
     “While difficult market conditions persist in some of our businesses and the broader economy remains very sluggish, LPS with its strong market presence remains well-positioned,” said Lee A. Kennedy. “Given the current environment, we expect third quarter 2011 adjusted earnings to be in the range of 53-55 cents per diluted share.”
Use of Non-GAAP Financial Information
     U.S. Generally Accepted Accounting Principles (GAAP) is the term used to refer to the standard framework of guidelines for financial accounting. GAAP includes the standards, conventions, and rules accountants follow in recording and summarizing transactions, and in the preparation of financial statements. In addition to reporting financial results in accordance with GAAP, LPS reports several non-GAAP measures, including “EBIT, as adjusted” (GAAP operating income adjusted for the impact of certain non-recurring adjustments, if applicable), “adjusted net earnings” (GAAP net earnings adjusted for the impact of certain non-recurring adjustments, if applicable, plus the after-tax purchase price amortization of intangible assets added through acquisitions), “adjusted net earnings per diluted share” (adjusted net earnings divided by diluted weighted average shares), and “adjusted free cash flow” (net cash provided by operating activities less additions to property, equipment and computer software, as well as non-recurring adjustments, if applicable). LPS provides these measures because it believes that they are helpful to investors in comparing year-over-year performance in light of certain non-recurring charges, and to better understand our financial performance, competitive position and future prospects. Non-GAAP measures should be considered in conjunction with the GAAP financial presentation and should not be considered in isolation or as a substitute for GAAP net

 


 

earnings. A reconciliation of these non-GAAP measures to related GAAP measures is included in the attachments to this release.
Conference Call and Webcast
     LPS will host a conference call to discuss these results on Tuesday, July 26, 2011, at 8:00 a.m. ET. Interested parties are invited to listen to the live webcast by logging on to the Investor Relations section of the company’s website at www.lpsvcs.com. Supplemental materials will be available on the website. Those wishing to participate via the conference call may do so by calling 866-823-5035. A replay of the webcast will be available on the website shortly after the call where it will be archived for one month. A replay of the conference call will be available through August 2, 2011 by dialing 888-203-1112 (access code: 3547305).
     To access a printer friendly version of this release and accompanying exhibits, go to http://www.lpsvcs.com/investor.
About Lender Processing Services
     Lender Processing Services, Inc. (LPS) is a leading provider of integrated technology, services and loan performance data and analytics to the mortgage, consumer lending, capital markets and real estate industries. LPS offers solutions that span the mortgage continuum, including lead generation, origination, servicing, workflow automation, portfolio retention and default, augmented by the company’s award-winning customer support and professional services. Almost half of all U.S. mortgages are serviced using LPS’ Mortgage Servicing Package (MSP). For more information about LPS, visit www.lpsvcs.com.
Forward-Looking Statements
     This press release contains forward-looking statements that involve a number of risks and uncertainties. Those forward-looking statements include all statements that are not historical facts, including statements about our beliefs and expectations. Forward-looking statements are

 


 

based on management’s beliefs, as well as assumptions made by and information currently available to management. Because such statements are based on expectations as to future economic performance and are not statements of historical fact, actual results may differ materially from those projected. We undertake no obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise. The risks and uncertainties to which forward-looking statements are subject include, but are not limited to: our ability to adapt our services to changes in technology or the marketplace; the impact of adverse changes in the level of real estate activity (including among others, loan originations and foreclosures) on demand for certain of our services; our ability to maintain and grow our relationships with our customers; the effects of our substantial leverage on our ability to make acquisitions and invest in our business; the level of scrutiny being placed on participants in the foreclosure process; risks associated with federal and state inquiries and examinations currently underway or that may be commenced in the future with respect to our default management operations, and with civil litigation related to these matters; changes to the laws, rules and regulations that regulate our businesses as a result of the current economic and financial environment; changes in general economic, business and political conditions, including changes in the financial markets; the impact of any potential defects, development delays, installation difficulties or system failures on our business and reputation; risks associated with protecting information security and privacy; and other risks and uncertainties detailed in the “Statement Regarding Forward-Looking Information,” “Risk Factors” and other sections of the Company’s Form 10-K, the Company’s subsequent reports on Form 10-Q and other filings with the Securities and Exchange Commission.
###

 


 

Exhibit A
LENDER PROCESSING SERVICES, INC. AND SUBSIDIARIES
Consolidated Statements of Earnings
(Unaudited)
                                 
    Three months ended June 30,     Six months ended June 30,  
    2011     2010     2011     2010  
    (In thousands, except per share data)  
Processing and services revenues
  $ 517,495     $ 593,697     $ 1,072,282     $ 1,179,535  
Cost of revenues
    370,402       386,511       738,935       777,498  
 
                       
Gross profit
    147,093       207,186       333,347       402,037  
Selling, general and administrative expenses
    74,861       58,743       156,149       118,479  
 
                       
Operating income
    72,232       148,443       177,198       283,558  
Other income (expense):
                               
Interest income
    388       300       718       923  
Interest expense
    (13,715 )     (18,671 )     (27,811 )     (37,567 )
Other expense, net
    (70 )     119       (56 )     123  
 
                       
Total other income (expense)
    (13,397 )     (18,252 )     (27,149 )     (36,521 )
 
                       
Earnings from continuing operations before income taxes
    58,835       130,191       150,049       247,037  
Provision for income taxes
    21,607       49,797       56,269       94,490  
 
                       
Earnings from continuing operations
    37,228       80,394       93,780       152,547  
Discontinued operations, net of tax
    (15,863 )     19       (16,486 )     382  
 
                       
Net earnings
  $ 21,365     $ 80,413     $ 77,294     $ 152,929  
 
                       
 
                               
Net earnings per share — diluted from continuing operations
  $ 0.43     $ 0.85     $ 1.08     $ 1.60  
Net earnings per share — diluted from discontinued operations
    (0.18 )           (0.19 )      
 
                       
Net earnings per share — diluted
  $ 0.25     $ 0.85     $ 0.89     $ 1.60  
 
                       
Weighted average shares outstanding — diluted
    85,812       94,910       86,968       95,660  
 
                       

 


 

Exhibit B
LENDER PROCESSING SERVICES, INC. AND SUBSIDIARIES
Consolidated Balance Sheets
(Unaudited)
                 
    June 30,     December 31,  
    2011     2010  
    (In thousands)  
Assets
               
Current assets:
               
Cash and cash equivalents
  $ 22,008     $ 52,287  
Trade receivables, net of allowance for doubtful accounts
    366,514       419,647  
Other receivables
    3,100       4,910  
Prepaid expenses and other current assets
    35,885       38,328  
Deferred income taxes
    45,073       44,102  
 
           
Total current assets
    472,580       559,274  
 
           
 
               
Property and equipment, net of accumulated depreciation
    124,016       123,897  
Computer software, net of accumulated amortization
    220,081       217,573  
Other intangible assets, net of accumulated amortization
    49,011       58,269  
Goodwill
    1,150,631       1,159,539  
Other non-current assets
    152,878       133,291  
 
           
Total assets
  $ 2,169,197     $ 2,251,843  
 
           
 
               
Liabilities and Stockholders’ Equity
               
Current liabilities:
               
Current portion of long-term debt
  $ 145,157     $ 145,154  
Trade accounts payable
    44,414       51,610  
Accrued salaries and benefits
    50,572       55,230  
Recording and transfer tax liabilities
    12,926       10,879  
Other accrued liabilities
    149,569       145,203  
Deferred revenues
    54,155       57,651  
 
           
Total current liabilities
    456,793       465,727  
 
           
 
               
Deferred revenues
    34,364       36,893  
Deferred income taxes, net
    102,790       96,732  
Long-term debt, net of current portion
    1,086,668       1,104,247  
Other non-current liabilities
    23,551       22,030  
 
           
Total liabilities
    1,704,166       1,725,629  
 
           
 
               
Stockholders’ equity:
               
Preferred stock $0.0001 par value; 50 million shares authorized, none issued at June 30, 2011 or December 31, 2010, respectively
           
Common stock $0.0001 par value; 500 million shares authorized, 97.4 million shares issued at June 30, 2011 and December 31, 2010, respectively
    10       10  
Additional paid-in capital
    230,135       216,896  
Retained earnings
    656,018       596,168  
Accumulated other comprehensive loss
    (733 )     (283 )
Treasury stock $0.0001 par value; 13.1 million and 8.6 million shares at June 30, 2011 and December 31, 2010, respectively
    (420,399 )     (286,577 )
 
           
Total stockholders’ equity
    465,031       526,214  
 
           
Total liabilities and stockholders’ equity
  $ 2,169,197     $ 2,251,843  
 
           

 


 

Exhibit C
LENDER PROCESSING SERVICES, INC. AND SUBSIDIARIES
Consolidated Statements of Cash Flows
(Unaudited)
                 
    Six months ended June 30,  
    2011     2010  
    (In thousands)  
Cash flows from operating activities:
               
Net earnings
  $ 77,294     $ 152,929  
Adjustments to reconcile net earnings to net cash provided by operating activities:
               
Depreciation and amortization
    49,435       47,294  
Amortization of debt issuance costs
    2,317       2,317  
Asset impairment charges
    31,855        
Deferred income taxes, net
    3,553       9,023  
Stock-based compensation cost
    18,866       13,837  
Income tax benefit from exercise of stock options
    213       162  
Changes in assets and liabilities, net of effects of acquisitions:
               
Trade receivables
    53,412       17,512  
Other receivables
    1,811       (162 )
Prepaid expenses and other assets
    (4,023 )     (13,699 )
Deferred revenues
    (7,098 )     (15,031 )
Accounts payable, accrued liabilities and other liabilities
    (748 )     (7,513 )
 
           
Net cash provided by operating activities
    226,887       206,669  
 
           
 
               
Cash flows from investing activities:
               
Additions to property and equipment
    (19,261 )     (23,371 )
Additions to capitalized software
    (33,967 )     (33,795 )
Purchases of investments, net of proceeds from sales
    (9,390 )      
Acquisition of title plants and property records data
    (10,352 )      
Acquisitions, net of cash acquired
    (9,802 )      
 
           
Net cash used in investing activities
    (82,772 )     (57,166 )
 
           
 
               
Cash flows from financing activities:
               
Borrowings
    60,000        
Debt service payments
    (72,576 )     (2,550 )
Exercise of stock options and restricted stock vesting
    (2,358 )     10,906  
Tax benefit associated with equity compensation
    (213 )     (162 )
Dividends paid
    (17,444 )     (18,956 )
Treasury stock repurchases
    (136,878 )     (97,698 )
Bond repurchases
    (4,925 )      
Payment of contingent consideration related to acquisitions
          (2,978 )
 
           
Net cash used in financing activities
    (174,394 )     (111,438 )
Net (decrease) increase in cash and cash equivalents
    (30,279 )     38,065  
Cash and cash equivalents, beginning of period
    52,287       70,528  
 
           
Cash and cash equivalents, end of period
  $ 22,008     $ 108,593  
 
           
 
               
Supplemental disclosures of cash flow information:
               
Cash paid for interest
  $ 26,789     $ 36,558  
 
           
Cash paid for taxes
  $ 35,153     $ 71,332  
 
           

 


 

Exhibit D
LENDER PROCESSING SERVICES, INC. AND SUBSIDIARIES
SUPPLEMENTAL FINANCIAL INFORMATION — UNAUDITED
(In thousands)
                                                                         
    Six months ended June 30,     Quarter ended     Year ended  
    2011     2010     6/30/2011     3/31/2011     12/31/2010     9/30/2010     6/30/2010     3/31/2010     12/31/2010  
1. Revenues — Continuing Operations
                                                                       
 
                                                                       
Technology, Data and Analytics (TD&A):
                                                                       
Mortgage Processing
  $ 205,100     $ 199,990     $ 102,766     $ 102,334     $ 100,341     $ 102,362     $ 102,356     $ 97,634     $ 402,693  
Other TD&A
    188,051       152,740       92,552       95,499       97,859       89,804       77,468       75,272       340,403  
 
                                                     
Total
    393,151       352,730       195,318       197,833       198,200       192,166       179,824       172,906       743,096  
 
                                                     
 
                                                                       
Loan Transaction Services:
                                                                       
Loan Facilitation Services
    250,655       287,085       113,352       137,303       188,332       165,490       140,471       146,614       640,907  
Default Services
    431,459       543,717       210,338       221,121       251,327       265,572       275,046       268,671       1,060,616  
 
                                                     
Total
    682,114       830,802       323,690       358,424       439,659       431,062       415,517       415,285       1,701,523  
 
                                                     
 
                                                                       
Corporate and Other
    (2,983 )     (3,997 )     (1,513 )     (1,470 )     (1,893 )     (1,939 )     (1,644 )     (2,353 )     (7,829 )
 
                                                     
Total Revenue
  $ 1,072,282     $ 1,179,535     $ 517,495     $ 554,787     $ 635,966     $ 621,289     $ 593,697     $ 585,838     $ 2,436,790  
 
                                                     
 
                                                                       
Revenue Growth from Prior Year Period
                                                                       
 
                                                                       
Technology, Data and Analytics:
                                                                       
Mortgage Processing
    2.6 %     10.7 %     0.4 %     4.8 %     -3.7 %     -0.6 %     14.3 %     7.1 %     3.8 %
Other TD&A
    23.1 %     5.2 %     19.5 %     26.9 %     23.7 %     16.9 %     -1.6 %     13.4 %     13.1 %
 
                                                     
Total
    11.5 %     8.3 %     8.6 %     14.4 %     8.1 %     6.9 %     6.8 %     9.8 %     7.9 %
 
                                                     
 
                                                                       
Loan Transaction Services:
                                                                       
Loan Facilitation Services
    -12.7 %     7.2 %     -19.3 %     -6.4 %     31.8 %     21.1 %     -5.4 %     23.0 %     17.1 %
Default Services
    -20.6 %     -2.0 %     -23.5 %     -17.7 %     -9.8 %     -12.6 %     -8.2 %     5.2 %     -6.7 %
 
                                                     
Total
    -17.9 %     1.0 %     -22.1 %     -13.7 %     4.3 %     -2.1 %     -7.3 %     10.9 %     1.0 %
 
                                                     
 
                                                                       
Corporate and Other
    n/m       n/m       n/m       n/m       n/m       n/m       n/m       n/m       n/m  
 
                                                     
Total Revenue
    -9.1 %     3.7 %     -12.8 %     -5.3 %     5.6 %     1.4 %     -2.6 %     11.1 %     3.6 %
 
                                                     
 
                                                                       
2. Depreciation and Amortization
                                                                       
 
                                                                       
Depreciation and Amortization
  $ 36,222     $ 30,183     $ 18,360     $ 17,862     $ 18,290     $ 16,843     $ 15,466     $ 14,717     $ 65,316  
Purchase Price Amortization
    8,904       12,090       4,049       4,855       5,510       5,454       5,628       6,462       23,054  
Other Amortization
    3,405       3,919       1,717       1,688       1,690       1,668       1,976       1,943       7,277  
 
                                                     
Total continuing operations
    48,531       46,192       24,126       24,405       25,490       23,965       23,070       23,122       95,647  
Depreciation and Amortization — Discontinued Operations
    904       1,102       441       463       1,457       555       570       532       3,114  
 
                                                     
Total Depreciation and Amortization
  $ 49,435     $ 47,294     $ 24,567     $ 24,868     $ 26,947     $ 24,520     $ 23,640     $ 23,654     $ 98,761  
 
                                                     
 
                                                                       
3. Stock Compensation Expense (1)
                                                                       
 
                                                                       
Stock Compensation Expense, Excluding Acceleration Charges
  $ 14,997     $ 13,837     $ 8,238     $ 6,759     $ 8,228     $ 8,215     $ 7,280     $ 6,557     $ 30,280  
Stock Acceleration Expense
    3,869                   3,869       1,797                         1,797  
 
                                                     
Total Stock Compensation Expense
  $ 18,866     $ 13,837     $ 8,238     $ 10,628     $ 10,025     $ 8,215     $ 7,280     $ 6,557     $ 32,077  
 
                                                     
 
                                                                       
4. Discontinued Operations (2)
                                                                       
 
                                                                       
Revenue
  $ 3,012     $ 11,940     $ 1,601     $ 1,411     $ 2,854     $ 4,751     $ 5,384     $ 6,556     $ 19,545  
Cost of Sales
    3,961       9,371       1,884       2,077       5,191       4,122       4,336       5,035       18,684  
Selling, General and Administrative Expenses
    391       2,056       52       339       403       438       1,072       984       2,897  
Asset Impairment Charge (3)
    26,647             26,647                                      
 
                                                     
Operating (Loss) Income
    (27,987 )     513       (26,982 )     (1,005 )     (2,740 )     191       (24 )     537       (2,036 )
Total Other Income (Expense)
          107                   37       56       56       51       200  
 
                                                     
Earnings (Loss) Before Income Taxes
    (27,987 )     620       (26,982 )     (1,005 )     (2,703 )     247       32       588       (1,836 )
Provision (Benefit) for Income Taxes
    (11,501 )     238       (11,119 )     (382 )     (1,029 )     95       13       225       (696 )
 
                                                     
Net Earnings (Loss)
  $ (16,486 )   $ 382     $ (15,863 )   $ (623 )   $ (1,674 )   $ 152     $ 19     $ 363     $ (1,140 )
 
                                                     
 
                                                                       
Discontinued Operations — Reconciliation
                                                                       
 
                                                                       
Net Earnings (Loss), as reported
  $ (16,486 )   $ 382     $ (15,863 )   $ (623 )   $ (1,674 )   $ 152     $ 19     $ 363     $ (1,140 )
Adjustment:
                                                                       
Asset Impairment Charge, net of tax (3)
    15,707             15,707                                      
 
                                                     
Net Earnings, as adjusted
    (779 )     382       (156 )     (623 )     (1,674 )     152       19       363       (1,140 )
Purchase Price Amortization, net of tax
    234       316       117       118       602       158       158       158       1,076  
 
                                                     
Adjusted Net Earnings
  $ (545 )   $ 698     $ (39 )   $ (505 )   $ (1,072 )   $ 310     $ 177     $ 521     $ (64 )
 
                                                     
Adjusted Net Earnings (Loss) Per Diluted Share
  $ (0.01 )   $ 0.01     $     $ (0.01 )   $ (0.01 )   $     $     $ 0.01     $  
 
                                                     
Diluted Weighted Average Shares
    86,968       95,660       85,812       88,134       90,296       92,682       94,910       96,416       93,559  
 
                                                     
 
(1)   As the Company does not allocate stock compensation expense to the individual business units, there is no related expense associated with the discontinued operations.
 
(2)   The business units included in discontinued operations have historically been reported as a component of Other TD&A in the Technology, Data and Analytics reporting segment.
 
(3)   Reflects asset impairment charges totaling $26.6 million ($15.7 million net of tax) relating to the write-down of net assets in certain businesses that have been reclassified as discontinued operations.

 


 

Exhibit E
LENDER PROCESSING SERVICES, INC. AND SUBSIDIARIES
NON-GAAP FINANCIAL INFORMATION — UNAUDITED
(In thousands, except per share data)
                                                                         
    Six months ended June 30,     Quarter ended     Year ended  
    2011     2010     6/30/2011     3/31/2011     12/31/2010     9/30/2010     6/30/2010     3/31/2010     12/31/2010  
1. EBIT — Continuing Operations
                                                                       
Consolidated
                                                                       
Revenue
  $ 1,072,282     $ 1,179,535     $ 517,495     $ 554,787     $ 635,966     $ 621,289     $ 593,697     $ 585,838     $ 2,436,790  
Cost of Sales
    738,935       777,498       370,402       368,533       432,772       413,121       386,511       390,987       1,623,391  
Selling, General and Administrative Expenses
    156,149       118,479       74,861       81,288       71,896       64,078       58,743       59,736       254,453  
 
                                                     
Operating Income
    177,198       283,558       72,232       104,966       131,298       144,090       148,443       135,115       558,946  
Adjustments:
                                                                       
Cash Related Restructuring Costs
    23,446             7,943       15,503       2,472                         2,472  
Stock Related Restructuring Costs
    3,869                   3,869       1,797                         1,797  
Asset Impairment Charges
    5,208             5,208                                      
Out-of-period Adjustment
                            9,800                         9,800  
 
                                                     
EBIT, as adjusted
  $ 209,721     $ 283,558     $ 85,383     $ 124,338     $ 145,367     $ 144,090     $ 148,443     $ 135,115     $ 573,015  
 
                                                     
EBIT Margin, as adjusted
    19.6 %     24.0 %     16.5 %     22.4 %     22.9 %     23.2 %     25.0 %     23.1 %     23.5 %
 
                                                     
Depreciation and Amortization
  $ 48,531     $ 46,192     $ 24,126     $ 24,405     $ 25,490     $ 23,965     $ 23,070     $ 23,122     $ 95,647  
 
                                                     
 
                                                                       
Technology, Data and Analytics
                                                                       
Revenue
  $ 393,151     $ 352,730     $ 195,318     $ 197,833     $ 198,200     $ 192,166     $ 179,824     $ 172,906     $ 743,096  
Cost of Sales
    245,278       196,741       125,695       119,583       115,414       104,299       95,981       100,760       416,454  
Selling, General and Administrative Expenses
    42,295       37,821       20,735       21,560       19,647       20,670       18,994       18,827       78,138  
 
                                                     
Operating Income
    105,578       118,168       48,888       56,690       63,139       67,197       64,849       53,319       248,504  
Adjustments:
                                                                       
Cash Related Restructuring Costs (2)
    6,925             4,641       2,284                                
Asset Impairment Charges (4)
    4,646             4,646                                      
 
                                                     
EBIT, as adjusted
  $ 117,149     $ 118,168     $ 58,175     $ 58,974     $ 63,139     $ 67,197     $ 64,849     $ 53,319     $ 248,504  
 
                                                     
EBIT Margin, as adjusted
    29.8 %     33.5 %     29.8 %     29.8 %     31.9 %     35.0 %     36.1 %     30.8 %     33.4 %
 
                                                     
Depreciation and Amortization
  $ 35,375     $ 31,483     $ 17,488     $ 17,887     $ 17,448     $ 15,977     $ 15,477     $ 16,006     $ 64,908  
 
                                                     
 
                                                                       
Loan Transaction Services
                                                                       
Revenue
  $ 682,114     $ 830,802     $ 323,690     $ 358,424     $ 439,659     $ 431,062     $ 415,517     $ 415,285     $ 1,701,523  
Cost of Sales
    496,558       584,716       246,193       250,365       317,285       310,780       292,107       292,609       1,212,781  
Selling, General and Administrative Expenses
    42,749       45,655       20,208       22,541       26,440       23,561       21,798       23,857       95,656  
 
                                                     
Operating Income
    142,807       200,431       57,289       85,518       95,934       96,721       101,612       98,819       393,086  
Adjustments:
                                                                       
Cash Related Restructuring Costs (2)
    4,027             1,074       2,953                                
Asset Impairment Charges (4)
    562             562                                      
Out-of-period Adjustment (3)
                            9,800                         9,800  
 
                                                     
EBIT, as adjusted
  $ 147,396     $ 200,431     $ 58,925     $ 88,471     $ 105,734     $ 96,721     $ 101,612     $ 98,819     $ 402,886  
 
                                                     
EBIT Margin, as adjusted
    21.6 %     24.1 %     18.2 %     24.7 %     24.0 %     22.4 %     24.5 %     23.8 %     23.7 %
 
                                                     
Depreciation and Amortization
  $ 9,525     $ 10,935     $ 4,822     $ 4,703     $ 6,226     $ 6,152     $ 5,749     $ 5,186     $ 23,313  
 
                                                     
 
                                                                       
Corporate and Other
                                                                       
Revenue
  $ (2,983 )   $ (3,997 )   $ (1,513 )   $ (1,470 )   $ (1,893 )   $ (1,939 )   $ (1,644 )   $ (2,353 )   $ (7,829 )
Cost of Sales
    (2,901 )     (3,959 )     (1,486 )     (1,415 )     73       (1,958 )     (1,577 )     (2,382 )     (5,844 )
Selling, General and Administrative Expenses
    71,105       35,003       33,918       37,187       25,809       19,847       17,951       17,052       80,659  
 
                                                     
Operating Income
    (71,187 )     (35,041 )     (33,945 )     (37,242 )     (27,775 )     (19,828 )     (18,018 )     (17,023 )     (82,644 )
Adjustments:
                                                                       
Cash Related Restructuring Costs (2)(3)
    12,494             2,228       10,266       2,472                         2,472  
Stock Related Restructuring Costs (2)(3)
    3,869                   3,869       1,797                         1,797  
 
                                                     
EBIT, as adjusted
  $ (54,824 )   $ (35,041 )   $ (31,717 )   $ (23,107 )   $ (23,506 )   $ (19,828 )   $ (18,018 )   $ (17,023 )   $ (78,375 )
 
                                                     
Depreciation and Amortization
  $ 3,631     $ 3,774     $ 1,816     $ 1,815     $ 1,816     $ 1,836     $ 1,844     $ 1,930     $ 7,426  
 
                                                     
 
                                                                       
2. Net Earnings — Reconciliation
                                                                       
Net Earnings
  $ 77,294       152,929     $ 21,365     $ 55,929     $ 70,724     $ 78,691     $ 80,413     $ 72,516     $ 302,344  
Adjustments:
                                                                       
Cash Related Restructuring Costs, net of tax
    14,601             4,989       9,612       1,533                         1,533  
Stock Related Restructuring Costs, net of tax
    2,399                   2,399       1,114                         1,114  
Asset Impairment Charges — continuing operations, net of tax
    3,267             3,267                                      
Asset Impairment Charges — discontinued operations, net of tax
    15,707             15,707                                      
Out-of-period Adjustment, net of tax
                            6,076                         6,076  
 
                                                     
Net Earnings, as adjusted
    113,268       152,929       45,328       67,940       79,447       78,691       80,413       72,516       311,067  
Purchase Price Amortization, net of tax (1)
    5,802       7,781       2,674       3,128       4,059       3,526       3,633       4,148       15,366  
 
                                                     
Adjusted Net Earnings
  $ 119,070     $ 160,710     $ 48,002     $ 71,068     $ 83,506     $ 82,217     $ 84,046     $ 76,664     $ 326,433  
 
                                                     
Adjusted Net Earnings Per Diluted Share (2)
  $ 1.37     $ 1.69     $ 0.56     $ 0.81     $ 0.92     $ 0.89     $ 0.89     $ 0.80     $ 3.50  
 
                                                     
Diluted Weighted Average Shares
    86,968       95,660       85,812       88,134       90,296       92,682       94,910       96,416       93,559  
 
                                                     
 
                                                                       
3. Cashflow — Reconciliation
                                                                       
Cash Flows from Operating Activities:
                                                                       
Net Earnings
  $ 77,294     $ 152,929     $ 21,365     $ 55,929     $ 70,724     $ 78,691     $ 80,413     $ 72,516     $ 302,344  
Adjustments:
                                                                       
Cash Related Restructuring Costs, net of tax
    9,372             5,220       4,152       1,533                         1,533  
 
                                                     
Net Earnings, as adjusted
    86,666       152,929       26,585       60,081       72,257       78,691       80,413       72,516       303,877  
Adjustments to reconcile net earnings to net cash provided by operating activities:
                                                                       
Non-cash adjustments
    106,239       72,633       61,260       44,979       51,625       41,548       34,591       38,042       165,806  
Working capital adjustments
    43,354       (18,893 )     23,822       19,532       34,628       (35,191 )     (17,375 )     (1,518 )     (19,456 )
 
                                                     
Net cash provided by operating activities
    236,259       206,669       111,667       124,592       158,510       85,048       97,629       109,040       450,227  
 
                                                     
Capital expenditures included in investing activities
    (53,228 )     (57,166 )     (29,907 )     (23,321 )     (24,150 )     (26,940 )     (29,122 )     (28,044 )     (108,256 )
 
                                                     
 
                                                                       
Adjusted Net Free Cash Flow
  $ 183,031     $ 149,503     $ 81,760     $ 101,271     $ 134,360     $ 58,108     $ 68,507     $ 80,996     $ 341,971  
 
                                                     
 
Notes:
     
(1)   Purchase price amortization, net of tax represents the periodic amortization of intangible assets acquired through business acquisitions primarily relating to customer lists, trademarks and non-compete agreements.
 
(2)   During the three months ended March 31, 2011, we recorded a restructuring charge totaling totaling $19.4 million related to the departure of our former co-chief operating officer ($6.1 million of compensation and $3.6 million of stock acceleration), and other cost reduction initiatives ($9.7 million). Additionally, during the three months ended June 30, 2011, we recorded a restructuring charge totaling $7.9 million primarily related to an employee reduction program.
 
(3)   During the three months ended December 31, 2010, we recorded an immaterial error correction within cost of revenues totaling $9.8 million related to fiscal years 2007 and 2008. Additionally, we recorded a $4.3 million charge ($2.5 million of compensation and $1.8 million of stock acceleration) related to the departure of our former chief financial officer.
 
(4)   During the three months ended June 30, 2011, we recorded an asset impairment charge totaling $31.9 million ($5.2 million in continuing operations and $26.6 million in discontinued operations) relating to the write-down of net assets in certain underperforming operations that management has decided to dispose of or wind-down.