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United States
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

Current Report
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (date of earliest event reported):
July 25, 2006

Fidelity National Title Group, Inc.

(Exact name of Registrant as Specified in its Charter)

001-32630
(Commission File Number)

     
Delaware   16-1725106
(State or Other Jurisdiction of Incorporation or Organization)   (IRS Employer Identification Number)

601 Riverside Avenue
Jacksonville, Florida 32204

(Addresses of Principal Executive Offices)

(904) 854-8100
(Registrant’s Telephone Number, Including Area Code)


(Former Name or Former Address, if Changed Since Last Report)

     
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
 
   
o
  Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
 
   
o
  Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
 
   
o
  Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
 
   
o
  Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))



 


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Item 2.02. Results of Operations and Financial Condition
Item 9.01. Financial Statements and Exhibits
SIGNATURE
EXHIBIT INDEX
Exhibit 99.1


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Item 2.02. Results of Operations and Financial Condition

On July 25, 2006, Fidelity National Title Group, Inc. issued an earnings release announcing its financial results for the Second Quarter of 2006. The information in this Current Report is being furnished and shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended or otherwise subject to the liabilities of that Section. The information in this Current Report shall not be incorporated by reference into any registration statement or other document pursuant to the Securities Act of 1933, as amended.

A copy of the earnings release is attached as Exhibit 99.1.

Item 9.01. Financial Statements and Exhibits

(c) Exhibits

     
Exhibit
  Description
99.1
  Press release announcing Fidelity National Title Group, Inc. Reports Second Quarter 2006 EPS of $0.67.

 


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SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

         
  Fidelity National Financial, Inc.
 
 
Date: July 26, 2006  By:   /s/ Anthony J. Park  
    Name: Anthony J. Park
Title: Chief Financial Officer
 
       
 

 


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EXHIBIT INDEX

     
Exhibit
  Description
99.1
  Press release announcing Fidelity National Title Group, Inc. Reports Second Quarter 2006 EPS of $0.67.

 

exv99w1
 

Exhibit 99.1
(Fidelity Logo)   PRESS RELEASE
Fidelity National Title Group, Inc. Reports Second Quarter 2006 EPS of $0.67
Jacksonville, Fla. — (July 25, 2006) — Fidelity National Title Group, Inc. (NYSE: FNT), one of the nation’s largest title insurance companies and a majority-owned, publicly traded subsidiary of Fidelity National Financial, Inc. (NYSE: FNF), today reported operating results for the three-month and six-month periods ended June 30, 2006.
         
    2nd Quarter   2nd Quarter
    2006   2005
Total revenue
  $1.566 billion   $1.687 billion
Pre-tax margin
  11.6%   15.4%
Net earnings
  $116.5 million   $160.6 million
Net earnings per share — diluted
  $0.67   $0.93
Cash flow from operations
  $221.7 million   $332.0 million
Return on average equity
  18.4%   22.3%
         
    Six Months Ended   Six Months Ended
    June 30, 2006   June 30, 2005
Total revenue
  $2.959 billion   $2.952 billion
Pre-tax margin
  10.3%   13.2%
Net earnings
  $195.6 million   $242.9 million
Net earnings per share — diluted
  $1.13   $1.40
Cash flow from operations
  $301.9 million   $391.2 million
Return on average equity
  15.6%   17.0%
     “The second quarter results were a significant improvement from the seasonally challenging first quarter,” said Chief Executive Officer Raymond R. Quirk. “Open order volumes have remained consistent since February, staffing levels are stable, cash flow generation remains strong and our monthly financial results improved each month during the quarter. We

 


 

expect third quarter pre-tax margins and overall financial results to exceed those of the second quarter.”
     The following table depicts monthly direct orders opened and closed in the title and escrow business for the second quarter of both 2006 and 2005:
                         
    Direct Orders     Direct Orders        
Month   Opened     Closed     Closing %  
April 2006
    217,700       146,400       67 %
May 2006
    243,000       161,800       67 %
June 2006
    236,500       165,600       70 %
 
                   
Second Quarter 2006
    697,200       473,800       68 %
 
                 
                         
    Direct Orders     Direct Orders        
Month   Opened     Closed     Closing %  
April 2005
    259,600       177,100       68 %
May 2005
    268,700       180,200       67 %
June 2005
    301,200       203,100       67 %
 
                   
Second Quarter 2005
    829,500       560,400       68 %
 
                 
     The following table depicts monthly commercial direct orders opened and closed in the national commercial divisions for the second quarter of both 2006 and 2005:
                                 
    Open     Closed     Commercial        
    Commercial     Commercial     Revenue     Commercial  
    Orders     Orders     (In thousands)     Fee Per File  
2nd Quarter 2006
    14,240       9,064     $ 68,936     $ 7,605  
2nd Quarter 2005
    14,644       8,761     $ 66,821     $ 7,627  
     Fidelity National Title Group, Inc. (NYSE: FNT) is one of the nation’s largest title insurance companies. The Company’s title insurance underwriters — Fidelity National Title, Chicago Title, Ticor Title, Security Union Title and Alamo Title — issue approximately 29 percent of all title insurance policies in the United States. Through its direct operations and

 


 

agencies, the Company provides title insurance in 49 states, the District of Columbia, Guam, Mexico, Puerto Rico, the U.S. Virgin Islands and Canada. More information about Fidelity National Title Group can be found at www.fntg.com.
     FNT is a majority-owned subsidiary of Fidelity National Financial Inc. (NYSE: FNF), number 248 on the Fortune 500 and a provider of products and outsourced services and solutions to a variety of industries. More information about FNF can be found at www.fnf.com.
     This press release contains forward-looking statements that involve a number of risks and uncertainties. Statements that are not historical facts, including statements about our beliefs and expectations, are forward-looking statements. 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 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 which forward-looking statements are subject to include, but are not limited to: changes in general economic, business and political conditions, including changes in the financial markets; adverse changes in the level of real estate activity, which may be caused by, among other things, high or increasing interest rates, a limited supply of mortgage funding or a weak U. S. economy; compliance with extensive regulations; regulatory investigations of the title insurance industry; our business concentration in the State of California, the source of over 20% of our title insurance premiums; our dependence on distributions from our title insurance underwriters as our main source of cash flow; competition from other title insurance companies; and other risks detailed in the “Statement Regarding Forward-Looking Information,” “Risk Factors” and other sections of the Company’s Form 10-K and other filings with the Securities and Exchange Commission.

 


 

SOURCE: Fidelity National Title Group, Inc.
CONTACT: Daniel Kennedy Murphy, Senior Vice President, Finance and Investor Relations, Fidelity National Financial, Inc., 904-854-8120, dkmurphy@fnf.com

 


 

FIDELITY NATIONAL TITLE GROUP, INC.
SUMMARY OF EARNINGS
(In thousands, except per share amounts and order information)
                                 
    Three months ended     Six months ended  
    June 30,     June 30,  
    2006     2005     2006     2005  
    (Unaudited)     (Unaudited)  
Direct title premiums
  $ 504,532     $ 561,191     $ 952,301     $ 1,017,396  
Agency title premiums
    708,714       771,687       1,337,134       1,304,200  
 
                       
Total title premiums
    1,213,246       1,332,878       2,289,435       2,321,596  
Escrow and other title-related fees
    287,598       300,328       541,657       543,465  
 
                       
Total title and escrow
    1,500,844       1,633,206       2,831,092       2,865,061  
 
                               
Interest and investment income
    46,717       24,576       84,729       45,430  
Realized gains and losses
    6,107       18,486       20,613       21,922  
Other
    11,931       10,945       22,429       20,020  
 
                       
 
                               
Total revenue
    1,565,599       1,687,213       2,958,863       2,952,433  
 
                               
Personnel costs
    466,221       479,943       918,656       904,603  
Other operating expenses
    242,645       241,358       453,538       451,093  
Agent commissions
    544,169       595,220       1,032,537       1,005,121  
Depreciation and amortization
    27,194       24,523       53,431       49,389  
Claim loss expense
    91,017       86,451       171,738       150,677  
Interest expense
    12,374       421       23,700       724  
 
                       
 
                               
Total expenses
    1,383,620       1,427,916       2,653,600       2,561,607  
 
                               
Earnings before income taxes
    181,979       259,297       305,263       390,826  
Income tax expense
    64,603       97,774       108,369       146,637  
Minority interest
    863       945       1,279       1,292  
 
                       
 
                               
Net earnings
  $ 116,513     $ 160,578     $ 195,615     $ 242,897  
 
                       
 
                               
Net earnings per share — basic
  $ 0.67     $ 0.93     $ 1.13     $ 1.40  
 
                       
Net earnings per share — diluted
  $ 0.67     $ 0.93     $ 1.13     $ 1.40  
 
                       
 
                               
Weighted average shares — basic
    173,475       173,520       173,475       173,520  
 
                       
Weighted average shares — diluted
    173,647       173,520       173,651       173,520  
 
                       
 
                               
Direct operations orders opened
    697,200       829,500       1,381,000       1,577,200  
Direct operations orders closed
    473,800       560,400       910,100       1,048,900  
Fee Per File
  $ 1,597     $ 1,500     $ 1,566     $ 1,447  
 
(1)   For the 2005 period, net earnings per share is a pro forma presentation based on the distribution of 173,520 shares on October 17, 2005

 


 

FIDELITY NATIONAL TITLE GROUP, INC.
SUMMARY BALANCE SHEET INFORMATION
(In thousands, except per share amounts)
                 
    June 30,     December 31,  
    2006     2005  
    (Unaudited)          
Cash and investment portfolio
  $ 4,098,288     $ 3,762,895  
Goodwill
    1,051,523       1,051,526  
Title plants
    314,832       308,675  
Total assets
    6,199,666       5,900,533  
Notes payable
    573,197       603,262  
Reserve for claim losses
    1,130,444       1,063,857  
Secured trust deposits
    1,001,727       882,602  
Total stockholders’ equity
    2,551,178       2,480,037  
Book value per share
    14.64       14.23