For the transition period from ________ to ________ Commission file number: 001-31666 |
Incorporated in Delaware | 61-1437565 |
(State or other jurisdiction of incorporation or organization) |
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Signatures | |
(in thousands) | June 30, | December 31, | |
2009 | 2008 | ||
Assets | |||
Current assets: | |||
Cash and cash equivalents | $ 60,478 | $ 52,361 | |
Accounts receivable (less allowance for doubtful accounts | |||
of $11,977 and $8,345, respectively) | 118,702 | 121,531 | |
Prepaid expenses and other current assets | 9,634 | 9,032 | |
Due from affiliates | 2,908 | - | |
Deferred income tax asset | 16,846 | 16,695 | |
Total current assets | 208,568 | 199,619 | |
Property and equipment, net | 78,982 | 81,807 | |
Goodwill | 752,491 | 731,369 | |
Customer lists, net | 48,507 | 53,813 | |
Other intangible assets, net | 15,311 | 17,245 | |
Database development costs, net | 12,191 | 11,837 | |
Marketable equity securities | 43,389 | 30,365 | |
Other assets | 3,300 | 3,684 | |
Total assets | $ 1,162,739 | $ 1,129,739 | |
Liabilities and Equity | |||
Current liabilities: | |||
Accounts payable | $ 37,346 | $ 38,404 | |
Accrued compensation | 22,367 | 32,423 | |
Accrued liabilities | 13,511 | 11,379 | |
Deferred income | 6,755 | 7,381 | |
Income tax payable | 1,037 | 2,609 | |
Due to affiliates | - | 714 | |
Current portion of long-term debt and capital leases | 8,807 | 9,891 | |
Total current liabilities | 89,823 | 102,801 | |
Long-term debt and capital leases, net of current portion | 29,357 | 22,938 | |
Deferred income tax liability | 68,429 | 61,652 | |
Other liabilities | 4,971 | 5,300 | |
Total liabilities | 192,580 | 192,691 | |
Equity: | |||
First Advantage Corporations Stockholders' Equity: | |||
Preferred stock, $.001 par value; 1,000 shares authorized, no shares issued or outstanding | - | - | |
Class A common stock, $.001 par value; 125,000 shares authorized; | |||
12,061 and 11,772 shares issued and outstanding as of | |||
June 30, 2009 and December 31, 2008, respectively | 12 | 12 | |
Class B common stock, $.001 par value; 75,000 shares authorized; 47,727 shares issued | |||
and outstanding as of June 30, 2009 and December 31, 2008, respectively | 48 | 48 | |
Additional paid-in capital | 501,324 | 502,600 | |
Retained earnings | 414,187 | 390,602 | |
Accumulated other comprehensive income (loss) | 10,124 | (412) | |
Total First Advantage Corporation's stockholders' equity | 925,695 | 892,850 | |
Noncontrolling interests | 44,464 | 44,198 | |
Total equity | 970,159 | 937,048 | |
Total liabilities and equity | $ 1,162,739 | $ 1,129,739 |
(in thousands, except per share amounts) | For the Three Months Ended | For the Six Months Ended | ||||||||||
June 30, | June 30, | |||||||||||
2009 | 2008 | 2009 | 2008 | |||||||||
Service revenue | $ | 164,668 | $ | 182,423 | $ | 354,708 | $ | 370,677 | ||||
Reimbursed government fee revenue | 13,341 | 13,122 | 26,319 | 27,147 | ||||||||
Total revenue | 178,009 | 195,545 | 381,027 | 397,824 | ||||||||
Cost of service revenue | 58,261 | 53,487 | 139,601 | 107,203 | ||||||||
Government fees paid | 13,341 | 13,122 | 26,319 | 27,147 | ||||||||
Total cost of service | 71,602 | 66,609 | 165,920 | 134,350 | ||||||||
Gross margin | 106,407 | 128,936 | 215,107 | 263,474 | ||||||||
Salaries and benefits | 48,130 | 62,927 | 101,297 | 129,376 | ||||||||
Facilities and telecommunications | 6,865 | 8,084 | 13,524 | 16,284 | ||||||||
Other operating expenses | 18,597 | 22,909 | 37,944 | 45,743 | ||||||||
Depreciation and amortization | 10,895 | 10,726 | 21,581 | 20,622 | ||||||||
Impairment loss | - | 297 | - | 297 | ||||||||
Total operating expenses | 84,487 | 104,943 | 174,346 | 212,322 | ||||||||
Income from operations | 21,920 | 23,993 | 40,761 | 51,152 | ||||||||
Other (expense) income: | ||||||||||||
Interest expense | (294 | ) | (1,075 | ) | (669 | ) | (1,500 | ) | ||||
Interest income | 71 | 172 | 284 | 591 | ||||||||
Total other (expense), net | (223 | ) | (903 | ) | (385 | ) | (909 | ) | ||||
Income from continuing operations before income taxes | 21,697 | 23,090 | 40,376 | 50,243 | ||||||||
Provision for income taxes | 9,112 | 9,676 | 16,958 | 20,650 | ||||||||
Income from continuing operations | 12,585 | 13,414 | 23,418 | 29,593 | ||||||||
Loss from discontinued operations, net of tax | - | (1,264 | ) | - | (4,241 | ) | ||||||
Net income | 12,585 | 12,150 | 23,418 | 25,352 | ||||||||
Less: Net loss attributable to noncontrolling interest | (386 | ) | (238 | ) | (167 | ) | (325 | ) | ||||
Net income attributable to First Advantage Corporation ("FADV") | $ | 12,971 | $ | 12,388 | $ | 23,585 | $ | 25,677 | ||||
Basic income per share: | ||||||||||||
Income from continuing operations attributable to FADV shareholders | $ | 0.22 | $ | 0.23 | $ | 0.40 | $ | 0.50 | ||||
Loss from discontinued operations attributable to FADV shareholders, net of tax | - | (0.02 | ) | - | (0.07 | ) | ||||||
Net income attributable to FADV shareholders | $ | 0.22 | $ | 0.21 | $ | 0.40 | $ | 0.43 | ||||
Diluted income per share: | ||||||||||||
Income from continuing operations attributable to FADV shareholders | $ | 0.22 | $ | 0.23 | $ | 0.39 | $ | 0.50 | ||||
Loss from discontinued operations attributable to FADV shareholders, net of tax | - | (0.02 | ) | - | (0.07 | ) | ||||||
Net income attributable to FADV shareholders | $ | 0.22 | $ | 0.21 | $ | 0.39 | $ | 0.43 | ||||
Weighted-average common shares outstanding: | ||||||||||||
Basic | 59,776 | 59,435 | 59,681 | 59,297 | ||||||||
Diluted | 59,898 | 59,617 | 59,764 | 59,374 | ||||||||
Amounts attributable to FADV shareholders: | ||||||||||||
Income from continuing operations, net of tax | $ | 12,971 | $ | 13,652 | $ | 23,585 | $ | 29,918 | ||||
Loss from discontinued operations, net of tax | - | (1,264 | ) | - | (4,241 | ) | ||||||
Net income | $ | 12,971 | $ | 12,388 | $ | 23,585 | $ | 25,677 |
Three Months Ended | Six Months Ended | |||||||||||||||
(in thousands) | June 30, | June 30, | ||||||||||||||
2009 | 2008 | 2009 | 2008 | |||||||||||||
Net income | $ | 12,585 | $ | 12,150 | $ | 23,418 | $ | 25,352 | ||||||||
Other comprehensive income (loss) , net of tax: | ||||||||||||||||
Foreign currency translation adjustments | 3,572 | (670 | ) | 2,803 | 2,080 | |||||||||||
Unrealized gain (loss) on investment, net of tax | 5,915 | (9,230 | ) | 7,733 | (29,719 | ) | ||||||||||
Total other comprehensive income (loss) , net of tax | $ | 9,487 | $ | (9,900 | ) | $ | 10,536 | $ | (27,639 | ) | ||||||
Comprehensive income (loss) | $ | 22,072 | $ | 2,250 | $ | 33,954 | $ | (2,287 | ) | |||||||
Comprehensive loss attributable to the noncontrolling interest | (386 | ) | (238 | ) | (167 | ) | (325 | ) | ||||||||
Comprehensive income (loss) attributable to FADV | $ | 21,686 | $ | 2,012 | $ | 33,787 | $ | (2,612 | ) |
(in thousands) | September 30, | December 31, | ||||||
2009 | 2008 | |||||||
Current assets: | ||||||||
Cash and cash equivalents | $ | 57,784 | $ | 52,361 | ||||
Accounts receivable (less allowance for doubtful accounts | ||||||||
of $11,520 and $8,345, respectively) | 115,870 | 121,531 | ||||||
Prepaid expenses and other current assets | 8,929 | 9,032 | ||||||
Income tax receivable | 11,968 | - | ||||||
Due from affiliates | 3,180 | - | ||||||
Deferred income tax asset | 18,929 | 16,695 | ||||||
Total current assets | 216,660 | 199,619 | ||||||
Property and equipment, net | 76,638 | 81,807 | ||||||
Goodwill | 753,547 | 731,369 | ||||||
Customer lists, net | 45,820 | 53,813 | ||||||
Other intangible assets, net | 14,375 | 17,245 | ||||||
Database development costs, net | 12,406 | 11,837 | ||||||
Marketable equity securities | 48,293 | 30,365 | ||||||
Other assets | 5,994 | 3,684 | ||||||
Total assets | $ | 1,173,733 | $ | 1,129,739 | ||||
Liabilities and Equity | ||||||||
Current liabilities: | ||||||||
Accounts payable | $ | 35,382 | $ | 38,404 | ||||
Accrued compensation | 27,605 | 32,423 | ||||||
Accrued liabilities | 14,462 | 11,379 | ||||||
Deferred income | 5,704 | 7,381 | ||||||
Income tax payable | - | 2,609 | ||||||
Due to affiliates | - | 714 | ||||||
Current portion of long-term debt and capital leases | 20,446 | 9,891 | ||||||
Total current liabilities | 103,599 | 102,801 | ||||||
Long-term debt and capital leases, net of current portion | 1,028 | 22,938 | ||||||
Deferred income tax liability | 76,826 | 61,652 | ||||||
Other liabilities | 4,897 | 5,300 | ||||||
Total liabilities | 186,350 | 192,691 | ||||||
Equity: | ||||||||
First Advantage Corporation's stockholders' equity: | ||||||||
Preferred stock, $.001 par value; 1,000 shares authorized, | ||||||||
no shares issued or outstanding | - | - | ||||||
Class A common stock, $.001 par value; 125,000 shares | ||||||||
authorized; 12,095 and 11,772 shares issued and outstanding | ||||||||
as of September 30, 2009 and December 31, 2008, respectively | 12 | 12 | ||||||
Class B common stock, $.001 par value; 75,000 shares | ||||||||
authorized; 47,727 shares issued and outstanding | ||||||||
as of September 30, 2009 and December 31, 2008, respectively | 48 | 48 | ||||||
Additional paid-in capital | 502,411 | 502,600 | ||||||
Retained earnings | 425,637 | 390,602 | ||||||
Accumulated other comprehensive income (loss) | 14,414 | (412 | ) | |||||
Total First Advantage Corporation's stockholders' equity | 942,522 | 892,850 | ||||||
Noncontrolling interests | 44,861 | 44,198 | ||||||
Total equity | 987,383 | 937,048 | ||||||
Total liabilities and equity | $ | 1,173,733 | $ | 1,129,739 |
(in thousands, except per share amounts) | For the Three Months Ended | For the Nine Months Ended | ||||||||||||||
September 30, | September 30, | |||||||||||||||
2009 | 2008 | 2009 | 2008 | |||||||||||||
Service revenue | $ | 155,980 | $ | 174,664 | $ | 510,688 | $ | 545,341 | ||||||||
Reimbursed government fee revenue | 13,586 | 13,633 | 39,905 | 40,780 | ||||||||||||
Total revenue | 169,566 | 188,297 | 550,593 | 586,121 | ||||||||||||
Cost of service revenue | 51,429 | 53,520 | 191,030 | 160,723 | ||||||||||||
Government fees paid | 13,586 | 13,633 | 39,905 | 40,780 | ||||||||||||
Total cost of service | 65,015 | 67,153 | 230,935 | 201,503 | ||||||||||||
Gross margin | 104,551 | 121,144 | 319,658 | 384,618 | ||||||||||||
Salaries and benefits | 49,920 | 59,113 | 151,217 | 188,489 | ||||||||||||
Facilities and telecommunications | 6,741 | 7,789 | 20,265 | 24,073 | ||||||||||||
Other operating expenses | 18,453 | 19,899 | 56,397 | 65,642 | ||||||||||||
Depreciation and amortization | 10,993 | 10,898 | 32,574 | 31,520 | ||||||||||||
Impairment loss | - | 1,720 | - | 2,017 | ||||||||||||
Total operating expenses | 86,107 | 99,419 | 260,453 | 311,741 | ||||||||||||
Income from operations | 18,444 | 21,725 | 59,205 | 72,877 | ||||||||||||
Other (expense) income: | ||||||||||||||||
Interest expense | (234 | ) | (640 | ) | (903 | ) | (2,140 | ) | ||||||||
Interest income | 103 | 155 | 387 | 746 | ||||||||||||
Total other (expense), net | (131 | ) | (485 | ) | (516 | ) | (1,394 | ) | ||||||||
Income from continuing operations before income taxes | 18,313 | 21,240 | 58,689 | 71,483 | ||||||||||||
Provision for income taxes | 6,898 | 8,932 | 23,856 | 29,582 | ||||||||||||
Income from continuing operations | 11,415 | 12,308 | 34,833 | 41,901 | ||||||||||||
Loss from discontinued operations, net of tax | - | - | - | (4,241 | ) | |||||||||||
Net income | 11,415 | 12,308 | 34,833 | 37,660 | ||||||||||||
Less: Net loss attributable to noncontrolling interest | (35 | ) | (323 | ) | (202 | ) | (648 | ) | ||||||||
Net income attributable to First Advantage Corporation ("FADV") | $ | 11,450 | $ | 12,631 | $ | 35,035 | $ | 38,308 | ||||||||
Basic income per share: | ||||||||||||||||
Income from continuing operations attributable to FADV shareholders | $ | 0.19 | $ | 0.21 | $ | 0.59 | $ | 0.72 | ||||||||
Loss from discontinued operations attributable to FADV shareholders, net of tax | - | - | - | (0.07 | ) | |||||||||||
Net income attributable to FADV shareholders | $ | 0.19 | $ | 0.21 | $ | 0.59 | $ | 0.65 | ||||||||
Diluted income per share: | ||||||||||||||||
Income from continuing operations attributable to FADV shareholders | $ | 0.19 | $ | 0.21 | $ | 0.59 | $ | 0.72 | ||||||||
Loss from discontinued operations attributable to FADV shareholders, net of tax | - | - | - | (0.08 | ) | |||||||||||
Net income attributable to FADV shareholders | $ | 0.19 | $ | 0.21 | $ | 0.59 | $ | 0.64 | ||||||||
Weighted-average common shares outstanding: | ||||||||||||||||
Basic | 59,803 | 59,478 | 59,722 | 59,358 | ||||||||||||
Diluted | 60,086 | 59,529 | 59,867 | 59,446 | ||||||||||||
Amounts attributable to FADV shareholders: | ||||||||||||||||
Income from continuing operations | $ | 11,450 | $ | 12,631 | $ | 35,035 | $ | 42,549 | ||||||||
Loss from discontinued operations, net of tax | - | - | - | (4,241 | ) | |||||||||||
Net income | $ | 11,450 | $ | 12,631 | $ | 35,035 | $ | 38,308 |
Three Months Ended | Nine Months Ended | |||||||||||||||
(in thousands) | September 30, | September 30, | ||||||||||||||
2009 | 2008 | 2009 | 2008 | |||||||||||||
Net income | $ | 11,415 | $ | 12,308 | $ | 34,833 | $ | 37,660 | ||||||||
Other comprehensive income (loss) , net of tax: | ||||||||||||||||
Foreign currency translation adjustments | 1,495 | (4,515 | ) | 4,298 | (2,435 | ) | ||||||||||
Unrealized gain (loss) on investment, net of tax | 2,795 | 4,174 | 10,528 | (25,483 | ) | |||||||||||
Total other comprehensive income (loss) , net of tax | 4,290 | (341 | ) | 14,826 | (27,918 | ) | ||||||||||
Comprehensive income | 15,705 | 11,967 | 49,659 | 9,742 | ||||||||||||
Less: Comprehensive loss attributable to the noncontrolling interest | (35 | ) | (323 | ) | (202 | ) | (648 | ) | ||||||||
Comprehensive income attributable to FADV | $ | 15,740 | $ | 12,290 | $ | 49,861 | $ | 10,390 |
Accumulated | |||||||||||||||||||||||
(in thousands) | Common | Common | Additional | Other | |||||||||||||||||||
Stock | Stock | Paid-in | Retained | Comprehensive | Noncontrolling | ||||||||||||||||||
Shares | Amount | Capital | Earnings | (Loss) Income | Interests | Total | |||||||||||||||||
Balance at December 31, 2008 | 59,499 | $ | 60 | $ | 502,600 | $ | 390,602 | $ | (412 | ) | $ | 44,198 | $ | 937,048 | |||||||||
Net income | - | - | - | 23,585 | - | (167 | ) | 23,418 | |||||||||||||||
Purchase of subsidiary shares from | |||||||||||||||||||||||
noncontrolling interest | - | - | (5,506 | ) | - | - | 433 | (5,073 | ) | ||||||||||||||
Class A Shares issued in | |||||||||||||||||||||||
connection with share | |||||||||||||||||||||||
based compensation | 289 | - | 310 | - | - | - | 310 | ||||||||||||||||
Share based compensation | - | - | 3,920 | - | - | - | 3,920 | ||||||||||||||||
Foreign currency translation | - | - | - | - | 2,803 | - | 2,803 | ||||||||||||||||
Unrealized gain on investment, | |||||||||||||||||||||||
net of tax | - | - | - | - | 7,733 | - | 7,733 | ||||||||||||||||
Balance at June 30, 2009 | 59,788 | $ | 60 | $ | 501,324 | $ | 414,187 | $ | 10,124 | $ | 44,464 | $ | 970,159 | ||||||||||
Accumulated | ||||||||||||||||||||||||||||
(in thousands) | Common | Common | Additional | Other | ||||||||||||||||||||||||
Stock | Stock | Paid-in | Retained | Comprehensive | Noncontrolling | |||||||||||||||||||||||
Shares | Amount | Capital | Earnings | (Loss) Income | Interests | Total | ||||||||||||||||||||||
Balance at December 31, 2008 | 59,499 | $ | 60 | $ | 502,600 | $ | 390,602 | $ | (412 | ) | $ | 44,198 | $ | 937,048 | ||||||||||||||
Net income | - | - | - | 35,035 | - | (202 | ) | 34,833 | ||||||||||||||||||||
Purchase of subsidiary shares from | ||||||||||||||||||||||||||||
noncontrolling interest | - | - | (6,779 | ) | - | - | 865 | (5,914 | ) | |||||||||||||||||||
Class A Shares issued in connection | ||||||||||||||||||||||||||||
with share based compensation | 323 | - | 830 | - | - | - | 830 | |||||||||||||||||||||
Share based compensation | - | - | 5,760 | - | - | - | 5,760 | |||||||||||||||||||||
Foreign currency translation | - | - | - | - | 4,298 | - | 4,298 | |||||||||||||||||||||
Unrealized gain on investment, net of tax | - | - | - | - | 10,528 | - | 10,528 | |||||||||||||||||||||
Balance at September 30, 2009 | 59,822 | $ | 60 | $ | 502,411 | $ | 425,637 | $ | 14,414 | $ | 44,861 | $ | 987,383 |
(in thousands) | For the Nine Months Ended | |||||||
September 30, | ||||||||
2009 | 2008 | |||||||
Cash flows from operating activities: | ||||||||
Net income | $ | 34,833 | $ | 37,660 | ||||
Loss from discontinued operations | - | (4,241 | ) | |||||
Income from continuing operations | $ | 34,833 | $ | 41,901 | ||||
Adjustments to reconcile income from continuing operations to net | ||||||||
cash provided by (used in) operating activities: | ||||||||
Depreciation and amortization | 32,574 | 31,520 | ||||||
Impairment loss | - | 2,017 | ||||||
Bad debt expense | 7,013 | 5,867 | ||||||
Share based compensation | 5,760 | 7,344 | ||||||
Deferred income tax | 3,132 | 4,288 | ||||||
Change in operating assets and liabilities, net of acquisitions: | ||||||||
Accounts receivable | (2,220 | ) | 13,206 | |||||
Prepaid expenses and other current assets | 9 | 541 | ||||||
Other assets | (2,597 | ) | (790 | ) | ||||
Accounts payable | (2,908 | ) | (5,433 | ) | ||||
Accrued liabilities | 4,069 | (1,478 | ) | |||||
Deferred income | (1,630 | ) | (938 | ) | ||||
Due from affiliates | (3,894 | ) | (5,825 | ) | ||||
Income tax accounts | (12,072 | ) | (52,452 | ) | ||||
Accrued compensation and other liabilities | (5,050 | ) | (6,739 | ) | ||||
Net cash provided by operating activities - continuing operations | 57,019 | 33,029 | ||||||
Net cash provided by operating activities - discontinued operations | - | 754 | ||||||
Cash flows from investing activities: | ||||||||
Database development costs | (2,955 | ) | (3,203 | ) | ||||
Purchases of property and equipment | (14,517 | ) | (24,337 | ) | ||||
Cash paid for acquisitions | (19,465 | ) | (51,191 | ) | ||||
Proceeds from sale of assets | 900 | - | ||||||
Cash balance of companies acquired | - | 331 | ||||||
Net cash used in investing activities - continuing operations | (36,037 | ) | (78,400 | ) | ||||
Net cash provided by investing activities - discontinued operations | - | 1,721 | ||||||
Cash flows from financing activities: | ||||||||
Proceeds from long-term debt | 50,860 | 100,260 | ||||||
Repayment of long-term debt | (62,260 | ) | (85,455 | ) | ||||
Cash contributions from First American to LeadClick Holdings, LLC | - | 2,402 | ||||||
Proceeds from class A shares issued in connection with stock option | ||||||||
plan and employee stock purchase plan | 830 | 4,566 | ||||||
Cash paid for acquisition of noncontrolling interests | (5,914 | ) | (8,008 | ) | ||||
Distribution to noncontrolling interests | - | (1,127 | ) | |||||
Tax expense related to stock options | - | (204 | ) | |||||
Net cash (used in) provided by financing activities | (16,484 | ) | 12,434 | |||||
Effect of exchange rates on cash | 925 | (648 | ) | |||||
Increase (decrease) in cash and cash equivalents | 5,423 | (31,110 | ) | |||||
Cash and cash equivalents at beginning of period | 52,361 | 76,060 | ||||||
Change in cash and cash equivalents of discontinued operations | - | 540 | ||||||
Cash and cash equivalents at end of period | $ | 57,784 | $ | 45,490 |
(in thousands) | For the Six Months Ended | |||||||
June 30, | ||||||||
2009 | 2008 | |||||||
Cash flows from operating activities: | ||||||||
Net income | $ | 23,418 | $ | 25,352 | ||||
Loss from discontinued operations | - | (4,241 | ) | |||||
Income from continuing operations | $ | 23,418 | $ | 29,593 | ||||
Adjustments to reconcile income from continuing operations to net | ||||||||
cash provided by (used in) operating activities: | ||||||||
Depreciation and amortization | 21,581 | 20,919 | ||||||
Bad debt expense | 6,483 | 3,464 | ||||||
Share based compensation | 3,920 | 4,974 | ||||||
Deferred income tax | 1,324 | 7,676 | ||||||
Change in operating assets and liabilities, net of acquisitions: | ||||||||
Accounts receivable | (3,826 | ) | 13,603 | |||||
Prepaid expenses and other current assets | (547 | ) | (535 | ) | ||||
Other assets | 126 | (116 | ) | |||||
Accounts payable | (1,117 | ) | (2,322 | ) | ||||
Accrued liabilities | 1,905 | (1,962 | ) | |||||
Deferred income | (604 | ) | (477 | ) | ||||
Due from affiliates | (3,622 | ) | (6,782 | ) | ||||
Income tax accounts | (1,475 | ) | (59,400 | ) | ||||
Accrued compensation and other liabilities | (10,390 | ) | (11,157 | ) | ||||
Net cash provided by (used in) operating activities - continuing operations | 37,176 | (2,522 | ) | |||||
Net cash provided by operating activities - discontinued operations | - | 754 | ||||||
Cash flows from investing activities: | ||||||||
Database development costs | (1,939 | ) | (2,092 | ) | ||||
Purchases of property and equipment | (9,826 | ) | (17,479 | ) | ||||
Cash paid for acquisitions | (19,465 | ) | (51,152 | ) | ||||
Proceeds from sale of assets | 850 | - | ||||||
Cash balance of companies acquired | - | 331 | ||||||
Net cash used in investing activities - continuing operations | (30,380 | ) | (70,392 | ) | ||||
Net cash provided by investing activities - discontinued operations | - | 1,721 | ||||||
Cash flows from financing activities: | ||||||||
Proceeds from long-term debt | 50,396 | 90,000 | ||||||
Repayment of long-term debt | (45,139 | ) | (52,033 | ) | ||||
Cash contributions from First American to LeadClick Holdings, LLC | - | 2,402 | ||||||
Proceeds from class A shares issued in connection with stock option | ||||||||
plan and employee stock purchase plan | 310 | 4,365 | ||||||
Cash paid for acquisition of noncontrolling interests | (5,073 | ) | (8,008 | ) | ||||
Distribution to noncontrolling interests | - | (949 | ) | |||||
Tax expense related to stock options | - | (204 | ) | |||||
Net cash provided by financing activities | 494 | 35,573 | ||||||
Effect of exchange rates on cash | 827 | (146 | ) | |||||
Increase (decrease) in cash and cash equivalents | 8,117 | (35,012 | ) | |||||
Cash and cash equivalents at beginning of period | 52,361 | 76,060 | ||||||
Change in cash and cash equivalents of discontinued operations | - | 540 | ||||||
Cash and cash equivalents at end of period | $ | 60,478 | $ | 41,588 |
For the Six Months Ended | For the Nine Months Ended | |||||||||||||||
(in thousands) | June 30, | September 30, | ||||||||||||||
2009 | 2008 | 2009 | 2008 | |||||||||||||
Supplemental disclosures of cash flow information: | ||||||||||||||||
Cash paid for interest | $ | 432 | $ | 1,467 | $ | 684 | $ | 2,106 | ||||||||
Cash received for income tax refund | $ | 982 | $ | 987 | ||||||||||||
Cash received for income tax refunds | $ | 1,081 | $ | 1,248 | ||||||||||||
Cash paid for income taxes | $ | 17,580 | $ | 69,125 | $ | 33,996 | $ | 75,661 | ||||||||
Non-cash investing and financing activities: | ||||||||||||||||
Notes issued in connection with acquisitions | $ | - | $ | 3,026 | $ | - | $ | 3,026 | ||||||||
Class A shares issued for compensation | $ | 4,997 | $ | 2,767 | $ | 4,997 | $ | 2,788 | ||||||||
Unrealized gain (loss) on investment, net of tax | $ | 7,733 | $ | (29,719 | ) | $ | 10,528 | $ | (25,483 | ) |
June 30, 2009 | December 31, 2008 | September 30, 2009 | December 31, 2008 | |||||||||||||||||||||||||||
(in thousands) | Carrying | Estimated | Carrying | Estimated | Carrying | Estimated | Carrying | Estimated | ||||||||||||||||||||||
Amount | Fair Value | Amount | Fair Value | Amount | Fair Value | Amount | Fair Value | |||||||||||||||||||||||
Cash and cash equivalents | $ | 60,478 | $ | 60,478 | $ | 52,361 | $ | 52,361 | $ | 57,784 | $ | 57,784 | $ | 52,361 | $ | 52,361 | ||||||||||||||
Accounts receivable | 118,702 | 118,702 | 121,531 | 121,531 | 115,870 | 115,870 | 121,531 | 121,531 | ||||||||||||||||||||||
Marketable equity securities | 43,389 | 43,389 | 30,365 | 30,365 | 48,293 | 48,293 | 30,365 | 30,365 | ||||||||||||||||||||||
Long-term debt and capital leases | (38,164 | ) | (38,201 | ) | (32,829 | ) | (32,699 | ) | (21,474 | ) | (21,508 | ) | (32,829 | ) | (32,699 | ) |
Acquisitions, | Acquisitions, | Adjustments | ||||||||||||||||||||||||||
Balance at | (Disposals) | Adjustments to net | Balance at | Balance at | (Disposals) | to net assets | Balance at | |||||||||||||||||||||
(in thousands) | December 31, 2008 | and Earnouts | assets acquired | June 30, 2009 | December 31, 2008 | and Earnouts | acquired | September 30, 2009 | ||||||||||||||||||||
Credit Services | $ | 107,578 | $ | - | $ | - | $ | 107,578 | $ | 107,578 | $ | - | $ | - | $ | 107,578 | ||||||||||||
Data Services | 218,505 | (611 | ) | - | 217,894 | 218,505 | (611 | ) | - | 217,894 | ||||||||||||||||||
Employer Services | 272,461 | 2,266 | 2,245 | 276,972 | 272,461 | 2,266 | 3,308 | 278,035 | ||||||||||||||||||||
Multifamily Services | 49,174 | - | - | 49,174 | 49,174 | - | - | 49,174 | ||||||||||||||||||||
Investigative and Litigation Support Services | 83,651 | 17,199 | 23 | 100,873 | 83,651 | 17,199 | 16 | 100,866 | ||||||||||||||||||||
Consolidated | $ | 731,369 | $ | 18,854 | $ | 2,268 | $ | 752,491 | $ | 731,369 | $ | 18,854 | $ | 3,324 | $ | 753,547 |
Three months ended | Six months ended | |||||||
June 30, | June 30, | |||||||
(in thousands, except per share amounts) | 2008 | 2008 | ||||||
Total revenue | $ | 2,826 | $ | 7,671 | ||||
Loss from discontinued operations before income taxes | $ | (2,141 | ) | $ | (3,245 | ) | ||
Loss on sale of discontinued operations before income taxes | - | (3,910 | ) | |||||
Income tax benefit | (877 | ) | (2,914 | ) | ||||
Loss from discontinued operations, net of tax | $ | (1,264 | ) | $ | (4,241 | ) | ||
Loss per share: | ||||||||
Basic | $ | (0.02 | ) | $ | (0.07 | ) | ||
Diluted | $ | (0.02 | ) | $ | (0.07 | ) | ||
Weighted-average common shares outstanding: | ||||||||
Basic | 59,435 | 59,297 | ||||||
Diluted | 59,617 | 59,374 |
Nine months ended | ||||
September 30, | ||||
(in thousands, except per share amounts) | 2008 | |||
Total revenue | $ | 7,671 | ||
Loss from discontinued operations before income taxes | $ | (7,155 | ) | |
Income tax benefit | (2,914 | ) | ||
Loss from discontinued operations, net of tax | $ | (4,241 | ) | |
Loss per share: | ||||
Basic | $ | (0.07 | ) | |
Diluted | $ | (0.08 | ) | |
Weighted-average common shares outstanding: | ||||
Basic | 59,358 | |||
Diluted | 59,446 |
(in thousands) | September 30, 2009 | December 31, 2008 | ||||||
Goodwill | $ | 753,547 | $ | 731,369 | ||||
Customer lists | $ | 93,757 | $ | 95,446 | ||||
Less accumulated amortization | (47,937 | ) | (41,633 | ) | ||||
Customer lists, net | $ | 45,820 | $ | 53,813 | ||||
Other identifiable intangible assets: | ||||||||
Noncompete agreements | $ | 9,097 | $ | 11,783 | ||||
Trade names | 20,468 | 21,631 | ||||||
29,565 | 33,414 | |||||||
Less accumulated amortization | (15,190 | ) | (16,169 | ) | ||||
Other identifiable intangible assets, net | $ | 14,375 | $ | 17,245 |
(in thousands) | June 30, 2009 | December 31, 2008 | ||||||
Goodwill | $ | 752,491 | $ | 731,369 | ||||
Customer lists | $ | 95,556 | $ | 95,446 | ||||
Less accumulated amortization | (47,049 | ) | (41,633 | ) | ||||
Customer lists, net | $ | 48,507 | $ | 53,813 | ||||
Other identifiable intangible assets: | ||||||||
Noncompete agreements | $ | 10,186 | $ | 11,783 | ||||
Trade names | 21,664 | 21,631 | ||||||
31,850 | 33,414 | |||||||
Less accumulated amortization | (16,539 | ) | (16,169 | ) | ||||
Other identifiable intangible assets, net | $ | 15,311 | $ | 17,245 |
(in thousands) | ||||||||
Remainder of 2009 | $ | 7,252 | $ | 3,609 | ||||
2010 | 13,926 | 13,956 | ||||||
2011 | 11,307 | 11,323 | ||||||
2012 | 10,213 | 10,231 | ||||||
2013 | 8,812 | 8,831 | ||||||
Thereafter | 12,308 | 12,245 | ||||||
$ | 63,818 | $ | 60,195 |
Other | ||||||||
Identifiable | ||||||||
Intangible | Customer | |||||||
(in thousands) | Assets | Lists | ||||||
Balance, at December 31, 2008 | $ | 17,245 | $ | 53,813 | ||||
Adjustments | 37 | 57 | ||||||
Amortization | (2,907 | ) | (8,050 | ) | ||||
Balance, at September 30, 2009 | $ | 14,375 | $ | 45,820 |
Other | ||||||||
Identifiable | ||||||||
Intangible | Customer | |||||||
(in thousands) | Assets | Lists | ||||||
Balance, at December 31, 2008 | $ | 17,245 | $ | 53,813 | ||||
Adjustments | 33 | 58 | ||||||
Amortization | (1,967 | ) | (5,364 | ) | ||||
Balance, at June 30, 2009 | $ | 15,311 | $ | 48,507 |
(in thousands, except percentages) | ||||
Acquisition notes: | ||||
Weighted average interest rate of 3.65% with maturities | ||||
through 2011 | $ | 11,699 | ||
Bank notes: | ||||
$225 million Secured Credit Facility, interest at 30-day LIBOR | ||||
plus 1.13% (1.44% at June 30, 2009) matures September 2010 | 25,000 | |||
Capital leases and other debt: | ||||
Various interest rates with maturities through 2011 | 1,465 | |||
Total long-term debt and capital leases | $ | 38,164 | ||
Less current portion of long-term debt and capital leases | 8,807 | |||
Long-term debt and capital leases, net of current portion | $ | 29,357 | ||
(in thousands, except percentages) | ||||
Acquisition notes: Weighted average interest rate of 3.64% with maturities | ||||
through 2011 | $ | 9,657 | ||
Bank notes: $225 million Secured Credit Facility, interest at 30-day LIBOR | ||||
plus 1.13% (1.37% at September 30, 2009) matures September 2010 | 10,000 | |||
Capital leases and other debt: Various interest rates with maturities through 2011 | 1,817 | |||
Total long-term debt and capital leases | $ | 21,474 | ||
Less current portion of long-term debt and capital leases | 20,446 | |||
Long-term debt and capital leases, net of current portion | $ | 1,028 |
Three Months Ended | Six Months Ended | Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||
(in thousands, except per share amounts) | June 30, | June 30, | September 30, | September 30, | ||||||||||||||||||||||||
2009 | 2008 | 2009 | 2008 | 2009 | 2008 | 2009 | 2008 | |||||||||||||||||||||
Income from continuing operations attributable to FADV shareholders | $ | 12,971 | $ | 13,652 | $ | 23,585 | $ | 29,918 | $ | 11,450 | $ | 12,631 | $ | 35,035 | $ | 42,549 | ||||||||||||
Loss from discontinued operations attributable to FADV shareholders, net of tax | - | (1,264 | ) | - | (4,241 | ) | - | - | - | (4,241 | ) | |||||||||||||||||
Net income attributable to FADV shareholders | $ | 12,971 | $ | 12,388 | $ | 23,585 | $ | 25,677 | $ | 11,450 | $ | 12,631 | $ | 35,035 | $ | 38,308 | ||||||||||||
Denominator: | ||||||||||||||||||||||||||||
Weighted-average shares for basic earnings per share | 59,776 | 59,435 | 59,681 | 59,297 | 59,803 | 59,478 | 59,722 | 59,358 | ||||||||||||||||||||
Effect of restricted stock | 117 | 75 | 79 | 47 | 255 | 42 | 135 | 72 | ||||||||||||||||||||
Effect of dilutive securities - employee stock options and warrants | 5 | 107 | 4 | 30 | 28 | 9 | 10 | 16 | ||||||||||||||||||||
Denominator for diluted earnings per share | 59,898 | 59,617 | 59,764 | 59,374 | 60,086 | 59,529 | 59,867 | 59,446 | ||||||||||||||||||||
Earnings per share: | ||||||||||||||||||||||||||||
Basic | ||||||||||||||||||||||||||||
Income from continuing operations attributable to FADV shareholders | $ | 0.22 | $ | 0.23 | $ | 0.40 | $ | 0.50 | $ | 0.19 | $ | 0.21 | $ | 0.59 | $ | 0.72 | ||||||||||||
Loss from discontinued operations attributable to FADV shareholders, net of tax | - | (0.02 | ) | - | (0.07 | ) | - | - | - | (0.07 | ) | |||||||||||||||||
Net income attributable to FADV shareholders | $ | 0.22 | $ | 0.21 | $ | 0.40 | $ | 0.43 | $ | 0.19 | $ | 0.21 | $ | 0.59 | $ | 0.65 | ||||||||||||
Diluted | ||||||||||||||||||||||||||||
Income from continuing operations attributable to FADV shareholders | $ | 0.22 | $ | 0.23 | $ | 0.39 | $ | 0.50 | $ | 0.19 | $ | 0.21 | $ | 0.59 | $ | 0.72 | ||||||||||||
Loss from discontinued operations attributable to FADV shareholders, net of tax | - | (0.02 | ) | - | (0.07 | ) | - | - | - | (0.08 | ) | |||||||||||||||||
Net income attributable to FADV shareholders | $ | 0.22 | $ | 0.21 | $ | 0.39 | $ | 0.43 | $ | 0.19 | $ | 0.21 | $ | 0.59 | $ | 0.64 |
Weighted | ||||||||
(in thousands, except weighted average fair value prices) | Average | |||||||
Number of | Grant-Date | |||||||
Shares | Fair Value | |||||||
Nonvested restricted stock outstanding at December 31, 2008 | 632 | $ | 21.93 | |||||
Restricted stock granted | 423 | $ | 10.89 | |||||
Restricted stock forfeited | (30 | ) | $ | 17.99 | ||||
Restricted stock vested | (253 | ) | $ | 23.06 | ||||
Nonvested restricted stock outstanding at September 30, 2009 | 772 | $ | 15.66 |
Weighted | ||||||||
(in thousands, except exercise prices) | Average | |||||||
Number of | Grant-Date | |||||||
Shares | Fair Value | |||||||
Nonvested restricted stock outstanding at December 31, 2008 | 632 | $ | 21.93 | |||||
Restricted stock granted | 406 | $ | 10.61 | |||||
Restricted stock forfeited | (30 | ) | $ | 17.99 | ||||
Restricted stock vested | (253 | ) | $ | 23.06 | ||||
Nonvested restricted stock outstanding at June 30, 2009 | 755 | $ | 15.61 |
Three Months Ended | Six Months Ended | Three Months Ended | Nine Months Ended | ||||||||||||||||||||||||||
June 30, | June 30, | September 30, | September 30, | ||||||||||||||||||||||||||
(in thousands) | 2009 | 2008 | 2009 | 2008 | 2009 | 2008 | 2009 | 2008 | |||||||||||||||||||||
Stock options | $ | 487 | $ | 1,326 | $ | 1,120 | $ | 2,700 | $ | 457 | $ | 1,165 | $ | 1,578 | $ | 3,875 | |||||||||||||
Restricted stock | 1,459 | 1,349 | 2,746 | 2,188 | 1,363 | 1,169 | 4,109 | 3,357 | |||||||||||||||||||||
Employee stock purchase plan | 24 | 42 | 54 | 86 | 20 | 26 | 73 | 112 | |||||||||||||||||||||
$ | 1,970 | $ | 2,717 | $ | 3,920 | $ | 4,974 | $ | 1,840 | $ | 2,360 | $ | 5,760 | $ | 7,344 |
Weighted | Aggregate | Weighted | Aggregate | |||||||||||||||||||||
(in thousands, except exercise prices) | Number of | Average | Intrinsic | Number of | Average | Intrinsic | ||||||||||||||||||
Shares | Exercise Price | Value | Shares | Exercise Price | Value | |||||||||||||||||||
Options outstanding at December 31, 2008 | 3,492 | $ | 23.06 | $ | 71 | 3,492 | $ | 23.06 | $ | 863 | ||||||||||||||
Options exercised | (26 | ) | $ | 15.51 | ||||||||||||||||||||
Options forfeited | (106 | ) | $ | 28.31 | (294 | ) | $ | 24.66 | ||||||||||||||||
Options outstanding at June 30, 2009 | 3,386 | $ | 22.93 | $ | 68 | |||||||||||||||||||
Options outstanding at September 30, 2009 | 3,172 | $ | 22.98 | $ | 697 | |||||||||||||||||||
Options exercisable, end of the quarter | 3,137 | $ | 22.81 | $ | 68 | 2,956 | $ | 22.83 | $ | 692 |
(in thousands, except for exercise prices, years and weighted average amounts) | (in thousands, except for exercise prices, years and weighted average amounts) | (in thousands, except for exercise prices, years and weighted average amounts) | ||||||||||||||||||||||||||||||||||||||||||
Options Outstanding | Options Exercisable | Options Outstanding | Options Exercisable | |||||||||||||||||||||||||||||||||||||||||
Weighted Avg | Weighted | Weighted Avg | Weighted | Weighted | ||||||||||||||||||||||||||||||||||||||||
Range of | Remaining Contractual | Weighted Average | Average | |||||||||||||||||||||||||||||||||||||||||
Exercise Prices | Shares | Life in Years | Exercise Price | Shares | Exercise Price | |||||||||||||||||||||||||||||||||||||||
Remaining Contractual | Average | Average | ||||||||||||||||||||||||||||||||||||||||||
Range of Exercise Prices | Range of Exercise Prices | Shares | Life in Years | Exercise Price | Shares | Exercise Price | ||||||||||||||||||||||||||||||||||||||
$ | 7.00 - $ 12.50 | 9 | 2.2 | $ | 11.13 | 9 | $ | 11.13 | 7.00 - $ 12.50 | 9 | 1.9 | $ | 11.13 | 9 | $ | 11.13 | ||||||||||||||||||||||||||||
$ | 12.51 - $ 25.00 | 2,254 | 4.6 | $ | 20.85 | 2,167 | $ | 20.89 | 12.51 - $ 25.00 | 2,075 | 4.6 | $ | 20.90 | 2,018 | $ | 20.91 | ||||||||||||||||||||||||||||
$ | 25.01 - $ 50.00 | 1,118 | 6.2 | $ | 27.04 | 956 | $ | 27.09 | 25.01 - $ 50.00 | 1,084 | 6.1 | $ | 26.97 | 925 | $ | 27.01 | ||||||||||||||||||||||||||||
$ | 50.01 - $242.25 | 5 | 1.7 | $ | 60.50 | 5 | $ | 60.50 | 50.01 - $242.25 | 4 | 1.8 | $ | 50.25 | 4 | $ | 50.25 | ||||||||||||||||||||||||||||
3,386 | 3,137 | 3,172 | 2,956 |
(in thousands) | Service | Depreciation | Income (Loss) | |||||||||||||
Three Months Ended September 30, 2009 | Revenue | and Amortization | From Operations | Assets | ||||||||||||
Credit Services | $ | 59,443 | $ | 1,533 | $ | 12,489 | $ | 202,380 | ||||||||
Data Services | 25,514 | 2,435 | 3,590 | 298,524 | ||||||||||||
Employer Services | 41,731 | 3,771 | 3,929 | 388,095 | ||||||||||||
Multifamily Services | 19,879 | 1,542 | 7,268 | 84,458 | ||||||||||||
Investigative and Litigation Support Services | 9,804 | 724 | 1,337 | 120,971 | ||||||||||||
Corporate and Eliminations | (391 | ) | 988 | (10,169 | ) | 79,305 | ||||||||||
Consolidated | $ | 155,980 | $ | 10,993 | $ | 18,444 | $ | 1,173,733 | ||||||||
Three Months Ended September 30, 2008 | ||||||||||||||||
Credit Services | $ | 60,837 | $ | 1,728 | $ | 7,063 | $ | 196,406 | ||||||||
Data Services | 21,922 | 2,570 | 3,680 | 312,606 | ||||||||||||
Employer Services | 54,199 | 3,255 | 6,644 | 408,139 | ||||||||||||
Multifamily Services | 19,702 | 1,444 | 6,654 | 87,782 | ||||||||||||
Investigative and Litigation Support Services | 18,600 | 837 | 6,347 | 111,259 | ||||||||||||
Corporate and Eliminations | (596 | ) | 1,064 | (8,663 | ) | 64,606 | ||||||||||
Consolidated | $ | 174,664 | $ | 10,898 | $ | 21,725 | $ | 1,180,798 | ||||||||
Nine Months Ended September 30, 2009 | ||||||||||||||||
Credit Services | $ | 191,567 | $ | 4,470 | $ | 44,820 | $ | 202,380 | ||||||||
Data Services | 113,456 | 7,367 | 11,389 | 298,524 | ||||||||||||
Employer Services | 119,350 | 11,058 | 6,110 | 388,095 | ||||||||||||
Multifamily Services | 57,467 | 4,553 | 20,521 | 84,458 | ||||||||||||
Investigative and Litigation Support Services | 30,224 | 2,176 | 2,753 | 120,971 | ||||||||||||
Corporate and Eliminations | (1,376 | ) | 2,950 | (26,388 | ) | 79,305 | ||||||||||
Consolidated | $ | 510,688 | $ | 32,574 | $ | 59,205 | $ | 1,173,733 | ||||||||
Nine Months Ended September 30, 2008 | ||||||||||||||||
Credit Services | $ | 202,723 | $ | 4,480 | $ | 35,371 | $ | 196,406 | ||||||||
Data Services | 60,422 | 7,601 | 11,214 | 312,606 | ||||||||||||
Employer Services | 163,397 | 9,629 | 13,119 | 408,139 | ||||||||||||
Multifamily Services | 58,037 | 4,242 | 17,995 | 87,782 | ||||||||||||
Investigative and Litigation Support Services | 63,281 | 2,460 | 23,407 | 111,259 | ||||||||||||
Corporate and Eliminations | (2,519 | ) | 3,108 | (28,229 | ) | 64,606 | ||||||||||
Consolidated | $ | 545,341 | $ | 31,520 | $ | 72,877 | $ | 1,180,798 |
(in thousands) | Depreciation | Income (Loss) | ||||||||||||||
Three Months Ended June 30, 2009 | Service Revenue | and Amortization | From Operations | Assets | ||||||||||||
Credit Services | $ | 67,705 | $ | 1,488 | $ | 17,584 | $ | 200,797 | ||||||||
Data Services | 28,842 | 2,427 | 2,153 | 300,290 | ||||||||||||
Employer Services | 40,168 | 3,772 | 2,681 | 391,370 | ||||||||||||
Multifamily Services | 19,685 | 1,509 | 7,579 | 85,018 | ||||||||||||
Investigative and Litigation Support Services | 8,694 | 727 | 270 | 120,482 | ||||||||||||
Corporate and Eliminations | (426 | ) | 972 | (8,347 | ) | 64,782 | ||||||||||
Consolidated | $ | 164,668 | $ | 10,895 | $ | 21,920 | $ | 1,162,739 | ||||||||
Three Months Ended June 30, 2008 | | |||||||||||||||
Credit Services | $ | 66,984 | $ | 1,565 | $ | 11,961 | $ | 190,311 | ||||||||
Data Services | 19,533 | 2,534 | 3,764 | 313,651 | ||||||||||||
Employer Services | 55,511 | 3,295 | 3,004 | 410,989 | ||||||||||||
Multifamily Services | 19,986 | 1,429 | 6,569 | 89,342 | ||||||||||||
Investigative and Litigation Support Services | 21,178 | 858 | 7,535 | 115,539 | ||||||||||||
Corporate and Eliminations | (769 | ) | 1,045 | (8,840 | ) | 64,152 | ||||||||||
Consolidated | $ | 182,423 | $ | 10,726 | $ | 23,993 | $ | 1,183,984 | ||||||||
Six Months Ended June 30, 2009 | ||||||||||||||||
Credit Services | $ | 132,124 | $ | 2,937 | $ | 32,331 | $ | 200,797 | ||||||||
Data Services | 87,942 | 4,932 | 7,799 | 300,290 | ||||||||||||
Employer Services | 77,619 | 7,287 | 2,181 | 391,370 | ||||||||||||
Multifamily Services | 37,588 | 3,011 | 13,253 | 85,018 | ||||||||||||
Investigative and Litigation Support Services | 20,420 | 1,452 | 1,416 | 120,482 | ||||||||||||
Corporate and Eliminations | (985 | ) | 1,962 | (16,219 | ) | 64,782 | ||||||||||
Consolidated | $ | 354,708 | $ | 21,581 | $ | 40,761 | $ | 1,162,739 | ||||||||
Six Months Ended June 30, 2008 | ||||||||||||||||
Credit Services | $ | 141,886 | $ | 2,752 | $ | 28,308 | $ | 190,311 | ||||||||
Data Services | 38,500 | 5,031 | 7,534 | 313,651 | ||||||||||||
Employer Services | 109,198 | 6,374 | 6,475 | 410,989 | ||||||||||||
Multifamily Services | 38,335 | 2,798 | 11,341 | 89,342 | ||||||||||||
Investigative and Litigation Support Services | 44,681 | 1,623 | 17,060 | 115,539 | ||||||||||||
Corporate and Eliminations | (1,923 | ) | 2,044 | (19,566 | ) | 64,152 | ||||||||||
Consolidated | $ | 370,677 | $ | 20,622 | $ | 51,152 | $ | 1,183,984 |
(in thousands, except percentages) | ||||||||||||||||||||||
Invest/Litigation | Corporate | |||||||||||||||||||||
Three Months Ended June 30, 2009 | Credit Services | Data Services | Employer Services | Multifamily Services | Support Services | and Eliminations | Total | |||||||||||||||
Service revenue | $ | 67,705 | $ | 28,842 | $ | 40,168 | $ | 19,685 | $ | 8,694 | $ | (426 | ) | $ | 164,668 | |||||||
Reimbursed government fee revenue | 391 | 11,570 | 2,243 | - | - | (863 | ) | 13,341 | ||||||||||||||
Total revenue | 68,096 | 40,412 | 42,411 | 19,685 | 8,694 | (1,289 | ) | 178,009 | ||||||||||||||
Cost of service revenue | 30,544 | 15,404 | 10,666 | 1,751 | 526 | (630 | ) | 58,261 | ||||||||||||||
Government fees paid | 391 | 11,570 | 2,243 | - | - | (863 | ) | 13,341 | ||||||||||||||
Total cost of service | 30,935 | 26,974 | 12,909 | 1,751 | 526 | (1,493 | ) | 71,602 | ||||||||||||||
Gross margin | 37,161 | 13,438 | 29,502 | 17,934 | 8,168 | 204 | 106,407 | |||||||||||||||
Salaries and benefits | 12,063 | 4,367 | 15,615 | 5,792 | 5,050 | 5,243 | 48,130 | |||||||||||||||
Facilities and telecommunications | 1,633 | 659 | 2,128 | 730 | 725 | 990 | 6,865 | |||||||||||||||
Other operating expenses | 4,393 | 3,832 | 5,306 | 2,324 | 1,396 | 1,346 | 18,597 | |||||||||||||||
Depreciation and amortization | 1,488 | 2,427 | 3,772 | 1,509 | 727 | 972 | 10,895 | |||||||||||||||
Income (loss) from operations | $ | 17,584 | $ | 2,153 | $ | 2,681 | $ | 7,579 | $ | 270 | $ | (8,347 | ) | $ | 21,920 | |||||||
Operating margin percentage | 26.0 | % | 7.5 | % | 6.7 | % | 38.5 | % | 3.1 | % | N/A | 13.3 | % | |||||||||
Invest/Litigation | Corporate | |||||||||||||||||||||
Three Months Ended June 30, 2008 | Credit Services | Data Services | Employer Services | Multifamily Services | Support Services | and Eliminations | Total | |||||||||||||||
Service revenue | $ | 66,984 | $ | 19,533 | $ | 55,511 | $ | 19,986 | $ | 21,178 | $ | (769 | ) | $ | 182,423 | |||||||
Reimbursed government fee revenue | - | 11,906 | 2,226 | - | - | (1,010 | ) | 13,122 | ||||||||||||||
Total revenue | 66,984 | 31,439 | 57,737 | 19,986 | 21,178 | (1,779 | ) | 195,545 | ||||||||||||||
Cost of service revenue | 30,392 | 5,710 | 16,070 | 1,759 | 440 | (884 | ) | 53,487 | ||||||||||||||
Government fees paid | - | 11,906 | 2,226 | - | - | (1,010 | ) | 13,122 | ||||||||||||||
Total cost of service | 30,392 | 17,616 | 18,296 | 1,759 | 440 | (1,894 | ) | 66,609 | ||||||||||||||
Gross margin | 36,592 | 13,823 | 39,441 | 18,227 | 20,738 | 115 | 128,936 | |||||||||||||||
Salaries and benefits | 14,916 | 5,010 | 20,339 | 6,386 | 8,442 | 7,834 | 62,927 | |||||||||||||||
Facilities and telecommunications | 2,136 | 640 | 2,554 | 896 | 713 | 1,145 | 8,084 | |||||||||||||||
Other operating expenses | 6,014 | 1,875 | 9,952 | 2,947 | 3,190 | (1,069 | ) | 22,909 | ||||||||||||||
Depreciation and amortization | 1,565 | 2,534 | 3,295 | 1,429 | 858 | 1,045 | 10,726 | |||||||||||||||
Impairment loss | - | - | 297 | - | - | - | 297 | |||||||||||||||
Income (loss) from operations | $ | 11,961 | $ | 3,764 | $ | 3,004 | $ | 6,569 | $ | 7,535 | $ | (8,840 | ) | $ | 23,993 | |||||||
Operating margin percentage | 17.9 | % | 19.3 | % | 5.4 | % | 32.9 | % | 35.6 | % | N/A | 13.2 | % |
(in thousands, except percentages) | ||||||||||||||||||||||||||||||||||||||||||||||||||
Invest/Litigation | Corporate | Credit | Data | Employer | Multifamily | Invest/Litigation | Corporate | |||||||||||||||||||||||||||||||||||||||||||
Six Months Ended June 30, 2009 | Credit Services | Data Services | Employer Services | Multifamily Services | Support Services | and Eliminations | Total | |||||||||||||||||||||||||||||||||||||||||||
Three Months Ended September 30, 2009 | Services | Services | Services | Services | Support Services | and Eliminations | Total | |||||||||||||||||||||||||||||||||||||||||||
Service revenue | $ | 132,124 | $ | 87,942 | $ | 77,619 | $ | 37,588 | $ | 20,420 | $ | (985 | ) | $ | 354,708 | $ | 59,443 | $ | 25,514 | $ | 41,731 | $ | 19,879 | $ | 9,804 | $ | (391 | ) | $ | 155,980 | ||||||||||||||||||||
Reimbursed government fee revenue | 391 | 23,318 | 4,345 | - | - | (1,735 | ) | 26,319 | 223 | 11,987 | 2,138 | - | - | (762 | ) | 13,586 | ||||||||||||||||||||||||||||||||||
Total revenue | 132,515 | 111,260 | 81,964 | 37,588 | 20,420 | (2,720 | ) | 381,027 | 59,666 | 37,501 | 43,869 | 19,879 | 9,804 | (1,153 | ) | 169,566 | ||||||||||||||||||||||||||||||||||
Cost of service revenue | 59,601 | 56,387 | 20,716 | 3,239 | 871 | (1,213 | ) | 139,601 | 26,691 | 12,419 | 10,651 | 1,790 | 495 | (617 | ) | 51,429 | ||||||||||||||||||||||||||||||||||
Government fees paid | 391 | 23,318 | 4,345 | - | - | (1,735 | ) | 26,319 | 223 | 11,987 | 2,138 | - | - | (762 | ) | 13,586 | ||||||||||||||||||||||||||||||||||
Total cost of service | 59,992 | 79,705 | 25,061 | 3,239 | 871 | (2,948 | ) | 165,920 | 26,914 | 24,406 | 12,789 | 1,790 | 495 | (1,379 | ) | 65,015 | ||||||||||||||||||||||||||||||||||
Gross margin | 72,523 | 31,555 | 56,903 | 34,349 | 19,549 | 228 | 215,107 | 32,752 | 13,095 | 31,080 | 18,089 | 9,309 | 226 | 104,551 | ||||||||||||||||||||||||||||||||||||
Salaries and benefits | 24,239 | 9,745 | 32,733 | 12,108 | 11,705 | 10,767 | 101,297 | 12,238 | 4,839 | 16,142 | 6,110 | 5,303 | 5,288 | 49,920 | ||||||||||||||||||||||||||||||||||||
Facilities and telecommunications | 3,382 | 1,207 | 4,212 | 1,493 | 1,310 | 1,920 | 13,524 | 1,771 | 551 | 2,036 | 754 | 675 | 954 | 6,741 | ||||||||||||||||||||||||||||||||||||
Other operating expenses | 9,634 | 7,872 | 10,490 | 4,484 | 3,666 | 1,798 | 37,944 | 4,721 | 1,680 | 5,202 | 2,415 | 1,270 | 3,165 | 18,453 | ||||||||||||||||||||||||||||||||||||
Depreciation and amortization | 2,937 | 4,932 | 7,287 | 3,011 | 1,452 | 1,962 | 21,581 | 1,533 | 2,435 | 3,771 | 1,542 | 724 | 988 | 10,993 | ||||||||||||||||||||||||||||||||||||
Income (loss) from operations | $ | 32,331 | $ | 7,799 | $ | 2,181 | $ | 13,253 | $ | 1,416 | $ | (16,219 | ) | $ | 40,761 | $ | 12,489 | $ | 3,590 | $ | 3,929 | $ | 7,268 | $ | 1,337 | $ | (10,169 | ) | $ | 18,444 | ||||||||||||||||||||
Operating margin percentage | 24.5 | % | 8.9 | % | 2.8 | % | 35.3 | % | 6.9 | % | N/A | 11.5 | % | 21.0 | % | 14.1 | % | 9.4 | % | 36.6 | % | 13.6 | % | N/A | 11.8 | % | ||||||||||||||||||||||||
Invest/Litigation | Corporate | Credit | Data | Employer | Multifamily | Invest/Litigation | Corporate | |||||||||||||||||||||||||||||||||||||||||||
Six Months Ended June 30, 2008 | Credit Services | Data Services | Employer Services | Multifamily Services | Support Services | and Eliminations | Total | |||||||||||||||||||||||||||||||||||||||||||
Three Months Ended September 30, 2008 | Services | Services | Services | Services | Support Services | and Eliminations | Total | |||||||||||||||||||||||||||||||||||||||||||
Service revenue | $ | 141,886 | $ | 38,500 | $ | 109,198 | $ | 38,335 | $ | 44,681 | $ | (1,923 | ) | $ | 370,677 | $ | 60,837 | $ | 21,922 | $ | 54,199 | $ | 19,702 | $ | 18,600 | $ | (596 | ) | $ | 174,664 | ||||||||||||||||||||
Reimbursed government fee revenue | - | 24,215 | 5,031 | - | - | (2,099 | ) | 27,147 | - | 11,743 | 2,828 | - | - | (938 | ) | 13,633 | ||||||||||||||||||||||||||||||||||
Total revenue | 141,886 | 62,715 | 114,229 | 38,335 | 44,681 | (4,022 | ) | 397,824 | 60,837 | 33,665 | 57,027 | 19,702 | 18,600 | (1,534 | ) | 188,297 | ||||||||||||||||||||||||||||||||||
Cost of service revenue | 63,150 | 10,830 | 30,807 | 3,314 | 1,021 | (1,919 | ) | 107,203 | 28,985 | 8,628 | 14,234 | 1,915 | 503 | (745 | ) | 53,520 | ||||||||||||||||||||||||||||||||||
Government fees paid | - | 24,215 | 5,031 | - | - | (2,099 | ) | 27,147 | - | 11,743 | 2,828 | - | - | (938 | ) | 13,633 | ||||||||||||||||||||||||||||||||||
Total cost of service | 63,150 | 35,045 | 35,838 | 3,314 | 1,021 | (4,018 | ) | 134,350 | 28,985 | 20,371 | 17,062 | 1,915 | 503 | (1,683 | ) | 67,153 | ||||||||||||||||||||||||||||||||||
Gross margin | 78,736 | 27,670 | 78,391 | 35,021 | 43,660 | (4 | ) | 263,474 | 31,852 | 13,294 | 39,965 | 17,787 | 18,097 | 149 | 121,144 | |||||||||||||||||||||||||||||||||||
Salaries and benefits | 30,710 | 10,119 | 40,571 | 13,638 | 17,695 | 16,643 | 129,376 | 14,294 | 4,755 | 18,511 | 6,320 | 7,622 | 7,611 | 59,113 | ||||||||||||||||||||||||||||||||||||
Facilities and telecommunications | 4,341 | 1,279 | 5,050 | 1,830 | 1,495 | 2,289 | 16,284 | 2,203 | 643 | 2,280 | 836 | 722 | 1,105 | 7,789 | ||||||||||||||||||||||||||||||||||||
Other operating expenses | 12,625 | 3,707 | 19,624 | 5,414 | 5,787 | (1,414 | ) | 45,743 | 4,844 | 1,646 | 9,275 | 2,533 | 2,569 | (968 | ) | 19,899 | ||||||||||||||||||||||||||||||||||
Depreciation and amortization | 2,752 | 5,031 | 6,374 | 2,798 | 1,623 | 2,044 | 20,622 | 1,728 | 2,570 | 3,255 | 1,444 | 837 | 1,064 | 10,898 | ||||||||||||||||||||||||||||||||||||
Impairment loss | - | - | 297 | - | - | - | 297 | 1,720 | - | - | - | - | - | 1,720 | ||||||||||||||||||||||||||||||||||||
Income (loss) from operations | $ | 28,308 | $ | 7,534 | $ | 6,475 | $ | 11,341 | $ | 17,060 | $ | (19,566 | ) | $ | 51,152 | $ | 7,063 | $ | 3,680 | $ | 6,644 | $ | 6,654 | $ | 6,347 | $ | (8,663 | ) | $ | 21,725 | ||||||||||||||||||||
Operating margin percentage | 20.0 | % | 19.6 | % | 5.9 | % | 29.6 | % | 38.2 | % | N/A | 13.8 | % | 11.6 | % | 16.8 | % | 12.3 | % | 33.8 | % | 34.1 | % | N/A | 12.4 | % |
Credit | Data | Employer | Multifamily | Invest/Litigation | Corporate | |||||||||||||||||||||||
Nine Months Ended September 30, 2009 | Services | Services | Services | Services | Support Services | and Eliminations | Total | |||||||||||||||||||||
Service revenue | $ | 191,567 | $ | 113,456 | $ | 119,350 | $ | 57,467 | $ | 30,224 | $ | (1,376 | ) | $ | 510,688 | |||||||||||||
Reimbursed government fee revenue | 614 | 35,305 | 6,483 | - | - | (2,497 | ) | 39,905 | ||||||||||||||||||||
Total revenue | 192,181 | 148,761 | 125,833 | 57,467 | 30,224 | (3,873 | ) | 550,593 | ||||||||||||||||||||
Cost of service revenue | 86,292 | 68,806 | 31,367 | 5,029 | 1,366 | (1,830 | ) | 191,030 | ||||||||||||||||||||
Government fees paid | 614 | 35,305 | 6,483 | - | - | (2,497 | ) | 39,905 | ||||||||||||||||||||
Total cost of service | 86,906 | 104,111 | 37,850 | 5,029 | 1,366 | (4,327 | ) | 230,935 | ||||||||||||||||||||
Gross margin | 105,275 | 44,650 | 87,983 | 52,438 | 28,858 | 454 | 319,658 | |||||||||||||||||||||
Salaries and benefits | 36,477 | 14,584 | 48,875 | 18,218 | 17,008 | 16,055 | 151,217 | |||||||||||||||||||||
Facilities and telecommunications | 5,153 | 1,758 | 6,248 | 2,247 | 1,985 | 2,874 | 20,265 | |||||||||||||||||||||
Other operating expenses | 14,355 | 9,552 | 15,692 | 6,899 | 4,936 | 4,963 | 56,397 | |||||||||||||||||||||
Depreciation and amortization | 4,470 | 7,367 | 11,058 | 4,553 | 2,176 | 2,950 | 32,574 | |||||||||||||||||||||
Income (loss) from operations | $ | 44,820 | $ | 11,389 | $ | 6,110 | $ | 20,521 | $ | 2,753 | $ | (26,388 | ) | $ | 59,205 | |||||||||||||
Operating margin percentage | 23.4 | % | 10.0 | % | 5.1 | % | 35.7 | % | 9.1 | % | N/A | 11.6 | % | |||||||||||||||
Credit | Data | Employer | Multifamily | Invest/Litigation | Corporate | |||||||||||||||||||||||
Nine Months Ended September 30, 2008 | Services | Services | Services | Services | Support Services | and Eliminations | Total | |||||||||||||||||||||
Service revenue | $ | 202,723 | $ | 60,422 | $ | 163,397 | $ | 58,037 | $ | 63,281 | $ | (2,519 | ) | $ | 545,341 | |||||||||||||
Reimbursed government fee revenue | - | 35,958 | 7,859 | - | - | (3,037 | ) | 40,780 | ||||||||||||||||||||
Total revenue | 202,723 | 96,380 | 171,256 | 58,037 | 63,281 | (5,556 | ) | 586,121 | ||||||||||||||||||||
Cost of service revenue | 92,135 | 19,458 | 45,041 | 5,229 | 1,524 | (2,664 | ) | 160,723 | ||||||||||||||||||||
Government fees paid | - | 35,958 | 7,859 | - | - | (3,037 | ) | 40,780 | ||||||||||||||||||||
Total cost of service | 92,135 | 55,416 | 52,900 | 5,229 | 1,524 | (5,701 | ) | 201,503 | ||||||||||||||||||||
Gross margin | 110,588 | 40,964 | 118,356 | 52,808 | 61,757 | 145 | 384,618 | |||||||||||||||||||||
Salaries and benefits | 45,004 | 14,874 | 59,082 | 19,958 | 25,317 | 24,254 | 188,489 | |||||||||||||||||||||
Facilities and telecommunications | 6,544 | 1,922 | 7,330 | 2,666 | 2,217 | 3,394 | 24,073 | |||||||||||||||||||||
Other operating expenses | 17,469 | 5,353 | 28,899 | 7,947 | 8,356 | (2,382 | ) | 65,642 | ||||||||||||||||||||
Depreciation and amortization | 4,480 | 7,601 | 9,629 | 4,242 | 2,460 | 3,108 | 31,520 | |||||||||||||||||||||
Impairment loss | 1,720 | - | 297 | - | - | - | 2,017 | |||||||||||||||||||||
Income (loss) from operations | $ | 35,371 | $ | 11,214 | $ | 13,119 | $ | 17,995 | $ | 23,407 | $ | (28,229 | ) | $ | 72,877 | |||||||||||||
Operating margin percentage | 17.4 | % | 18.6 | % | 8.0 | % | 31.0 | % | 37.0 | % | N/A | 13.4 | % |
(In thousands) | 2009 | 2010 | 2011 | 2012 | 2013 | Thereafter | Total | |||||||||||||||||||||
Minimum contract purchase commitments | $ | 1,019 | $ | 2,653 | $ | 897 | $ | 41 | $ | 41 | $ | 26 | $ | 4,677 | ||||||||||||||
Advertising commitments | 105 | - | - | - | - | - | 105 | |||||||||||||||||||||
Operating leases | 3,670 | 12,576 | 8,931 | 7,024 | 6,958 | 14,907 | 54,066 | |||||||||||||||||||||
Debt and capital leases | 2,359 | 18,420 | 492 | 72 | 78 | 53 | 21,474 | |||||||||||||||||||||
Interest payments related to debt (1) | 197 | 231 | 4 | - | - | - | 432 | |||||||||||||||||||||
Total (2) | $ | 7,350 | $ | 33,880 | $ | 10,324 | $ | 7,137 | $ | 7,077 | $ | 14,986 | $ | 80,754 | ||||||||||||||
(1) Estimated interest payments are calculated assuming current interest rates over minimum maturity periods specified in debt agreements.
(2) Excludes tax liability of $4.9 million due to uncertainty of payment period.
(In thousands) | 2009 | 2010 | 2011 | 2012 | 2013 | Thereafter | Total | |||||||||||||||
Minimum contract purchase commitments | $ | 2,042 | $ | 2,618 | $ | 902 | $ | 41 | $ | 41 | $ | 26 | $ | 5,670 | ||||||||
Advertising commitments | 167 | - | - | - | - | - | 167 | |||||||||||||||
Operating leases | 7,161 | 12,222 | 8,849 | 7,029 | 6,963 | 13,402 | 55,626 | |||||||||||||||
Debt and capital leases | 4,548 | 32,921 | 492 | 72 | 78 | 53 | 38,164 | |||||||||||||||
Interest payments related to debt (1) | 768 | 549 | 4 | - | - | - | 1,321 | |||||||||||||||
Total (2) | $ | 14,686 | $ | 48,310 | $ | 10,247 | $ | 7,142 | $ | 7,082 | $ | 13,481 | $ | 100,948 |
Legal Proceedings |
Risk Factors |
Unregistered Sales of Equity Securities and Use of Proceeds |
Defaults Upon Senior Securities |
Submission of Matters to a Vote of Security Holders |
Name of Nominee | Votes For | Votes Withheld | ||
Parker Kennedy | 9,947,340 | 442,683 | ||
Anand Nallathambi | 9,999,555 | 390,468 | ||
J. David Chatham | 9,708,958 | 681,065 | ||
Barry Connelly | 9,953,281 | 436,742 | ||
Frank McMahon | 9,742,635 | 647,388 | ||
Donald Nickelson | 7,769,680 | 2,620,343 | ||
Donald Robert | 10,324,492 | 65,531 | ||
Jill Kanin-Lovers | 10,187,926 | 202,097 | ||
D. Van Skilling | 9,708,902 | 681,121 | ||
David Walker | 9,092,155 | 1,297,868 |
Other Information |
Item 6. | Exhibits |
Date: | By: | /s/ ANAND NALLATHAMBI | |
Date: | By: | /s/ JOHN LAMSON | |
Name: John Lamson | |||
Title: Chief Financial Officer | |||
10.1 | Third Amended and Restated Services Agreement between The First American Corporation and First Advantage Corporation, effective January 1, 2009. |
31.1 | Certification pursuant to Exchange Act Rule 13a-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 |
31.2 | Certification pursuant to Exchange Act Rule 13a-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 |
32.1 | Certifications pursuant to Exchange Act Rule 13a-14(b) and 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 |
32.2 | Certifications pursuant to Exchange Act Rule 13a-14(b) and 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 |