富达国民金融 2024年度报告

FINANCIAL HIGHLIGHTS BALANCE SHEET: Michael J. NolanChief Executive Officer William P. Foley, IIChairman of the Board DEAR FELLOW SHAREHOLDERS, I am once again proud of our results as they clearly demonstrate the dynamic business that we have created, whichis well positioned to outperform during varying economic cycles. While interest rates remained elevated and volatilethroughout 2024, our Title Segment delivered an industry leading adjusted pre-tax title margin, and our F&GSegment (F&G) achieved record sales and assets under management. Our results are a testament to the hard work andcommitment of our employees who deliver industry leading results year in and year out and I would like to thank themfor their efforts over the last year. Title Segment’s industry leading performance Turning to our 2024 results, the Title Segment delivered adjusted pre-tax earnings of $1.2 billion, compared with $964million for 2023, and an industry leading adjusted pre-tax title margin of 15.1%, compared to 13.7% for 2023. These areoutstanding results, despite a very difficult real estate market, and a validation of the operational efficiencies that wehave achieved over the last decade. To put this in perspective, the National Association of Realtors (NAR) has reported that home sales in 2024 wereat their lowest level since 1995 due to high mortgage rates and a housing shortage. Our continued success is due tothe pioneering work and investment that we have made over many years. We have become more efficient acrossour operational footprint through our SoftPro integrated operating platform and enhanced our customer experiencethrough proven tools such as our inHere digital transaction platform. Our transformation can also be seen in our margins and steady free cash generation. For the full year 2024, ouradjusted pre-tax title margin expanded by 140 basis points over full year 2023, while also significantly outperformingprior cycle troughs. Additionally, we continued to generate a steady level of free cash flow which we have used to investin our business through attractive acquisitions and continued investments in technology, while also increasing ourdividend. Our ability to sustain this level of cash while returning capital to shareholders and investing in the business insuch a low transaction environment is certainly noteworthy and, we feel, differentiates us from cyclical businesses. Wehave also invested in F&G given the compelling opportunities that we have to further grow F&G’s business and earningscontribution to FNF. F&G Segment exceeding expectations We purchased F&G in June of 2020 with the expectation that it would double assets under management (AUM) overfive years, while providing an important complement to our Title business. Fast forward over four years later, F&G hassignificantly exceeded our expectations. Today, F&G is sourcing significant premiums from three distinct retail channels and two institutional markets, versus asingle channel prior to the acquisition by FNF. Gross sales of $15.3 billion for 2024 have grown from $3.9 billion for 2019(pre-merger), driven by record retail channel and robust institutional market sales. This included record net sales of $10.6billion in 2024. Record AUM before flow reinsurance was $65.3 billion at year-end 2024. This included record retainedAUM of $53.8 billion at year-end 2024, which has more than doubled from $26.4 billion at year-end 2019 (pre-merger). F&G is a strong growth engine and continues to make progress toward its Investor Day targets of asset growth, marginexpansion and enhanced earnings from flow reinsurance and owned distribution, which continues to be accretive to FNF’sgrowth profile and earnings. In fact, the F&G Segment contributed 38% to FNF’s consolidated adjusted net earnings forthe full year 2024, up from 30% in 2023 and 23% in 2022. Given F&G’s growth outlook, our Board of Directors made the decision to invest $250 million into F&G’s mandatoryconvertible preferred stock issued to FNF in early 2024. In total, F&G paid $108 million of cash dividends on commonand preferred stock to FNF in 2024. Looking to the year ahead I am very pleased with the exceptional performance of 2024, with both businesses executing well in the current market.As I look ahead, I remain optimistic given the many opportunities that I see to further grow our Company. The Title Segment remains poised for a rebound in transaction volumes, and we continue to invest in the business for thelong-term, while delivering industry leading margins. Over my career, housing has been a secular growth market, and Ibelieve that growth is firmly set to continue. While we are well positioned to benefit from the eventual increase in homesales, we are not standing idle. We remain focused on investing in our business through accretive acquisitions to expandour Title footprint, as well as technology to further drive operational efficiencies across our Company. We have beeninvesting in our