CNNE - Earnings call 4 2023 | Cannae Holdings, Inc.

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Operator

Good afternoon, ladies and gentlemen, and welcome to the Cannae Holdings Inc. Fourth Quarter and Full Year 2023 Financial Results Conference Call. [Operator Instructions] As a reminder, this conference call is being recorded, and a replay is available through 11:59 p.m. Eastern Time on February 28, 2024. With that, I would like to turn the call over to Jamie Lillis of Solebury Strategic Communications. ahead. go Please

Jamie Lillis

and operator, you joining for Thank all us. you, of

Coy, today, On President, Chairman Bryan Officer. we and call Ryan Chief Chief and Cannae's our Foley, have the Financial Bill Executive Caswell; our Officer,

intentions historical we Cannae's risks conference and strategies contain statements. and that this or forward-looking uncertainties. Before listeners that expectations, involve remarks not following call I Statements to the would future remind facts, begin, the a about that are our statements . Q&A hopes, including may statements like number regarding are of forward-looking

of those actual as materially Forward-looking currently statements as are well obligation fact, such undertakes no a expectations based as management. and to differ future made on may future projected. otherwise. information, statements information update new management's operating company events statements any and to statements, based and on beliefs as from to results by or Because are assumptions result available financial are forward-looking whether The not of results

risks to, this limited other include, statements financial and shareholder but are and our letter the released our with and remarks Today's afternoon include SEC. also references subject which other to quarterly in not the risks was to, forward-looking filings are uncertainties, will measures. The detailed factors in which non-GAAP

our information, letter. non-GAAP reconciliation GAAP financial in between is including provided shareholder a financial Additional information to information the

Foley, CEO, by like now will followed Bill and would to with I who Chairman a over turn call brief our open the Caswell. Ryan remarks, few to

the open your We line questions. for will then

William Foley

Jamie. Thanks,

I'd to X to over to of work continuing Board has many his assumed Rick Vice thank taken role him. to look Rick the the years Cannae As role like we for Directors. forward of Massey have our last previously Chairman of with of the and and announced, on I contributions CEO

buybacks. asset value I shares and the the and of term. net focus that trade on our am deep share shareholders Cannae discount returns immediate to both the input longer from CEO, shareholders very to As on of will I aware appreciate importance

afternoon, XX% to The commence repurchase release the million early $XX.XX. by offer common outstanding terms cash modified at our will $XX.XX which to my weeks. between on programs, intention under having the the of and will compared be capital. noted shares over with repurchase tender approximately than March -- share share including to and Cannae's tender worth Dutch stock of previously March SEC and million per the our I the transaction Dutch more In XX, a to company's $XXX will filed conditions which be tenders of in approved letter price The a in Further in XXXX, this commence hand. auction coming repurchased details, we addition funded $XXX returned

on share to which shares have to And announced XX.X speaks close net has to we still share in Cannae's looking commitment offer and to the tender buyback is remaining today. our value. million when when together were authorization, price Cannae Additionally, addition previous our asset that discount we taken

with our value. aligned in only but seeing our a also not share As our shareholders fair portfolio, price of that the very Cannae, towards I value of X creating holder value am growing top and appreciate

of proceeds now I'll received over Cannae's over from now billion important back private in have company. our this we've turn the where gross over call Ryan the Caswell, stock an investments best our of history, the Looking been Ceridian sales company part example President. success. $X.X to is in

Ryan Caswell

have minority with approximately and carve common attractive we who in solutions. to Barry on value. Cannae the as companies to with with with our provide undervalued catalyst the can investments partner is company company specific one, other for value for a for Jana collectively their different team, through unlock find both track a situation Jana stake a success, is record and upside thus by capital million an to control beneficial This out that shares acquired returns Cannae based where where investor. significant built . We work Cannae. of Jana opportunities sourcing a the investment entities. a catalyst Ostfeld, [indiscernible] Bill. part Jana as I'm I'm find for of finding with to opportunities you, critical with driving a a to creates our Continuing believe target excited relationship leveraging a and well i.e., Jana's business catalysts cash. and both or thrilled as acquire to strategic Cannae be is partnership long-term public to target of partnership company, can as execute incredible of our strategy Cannae Cannae tool will them Jana $XX Rosenstein, unlock result announcement to giving Thank as public to Cannae Scott today sourcing the and million and Partners together new to of the be Cannae these company

their this the Jana strong we're coupled platform. will their stand-alone their already their business the record Jana's of and enable stand-alone from investment will increasing of believe help Jana's be thus is well to of value given its optimal with partnership industry-leading opportunities and believe reason returns there long given Jana is track the performance an success. for grow scale, -- business to value the excited about business. we overall second its positioned The why its We enhance success, increase our in business,

additionally, relationship, the or price leveraging that its incentive and time, significant And and with the proprietary the new acquisition success. investments resulting of opportunities. will to underlying portfolio, our other's we pay opportunities will note the funds closing by the NAV and of the source would Trasimene returns aligns investment Cannae improving performance Jana be gap. Three, stock will make or transaction any management gap Cannae Jana stock parties to close, investment to both fees. not ownership fees Over shareholders. of of future not Crossequity I Cannae Jana to the on Cannae's in ability NAV subject price in believe

like to talk a I we XXXX. large a billion, in investment. increase the in and LBO CSI Bridgeport the with relationship valuation. Through from our CSI private CSI's expectations Frank Martire approximately outperformed has participate and in December, would the $X brought in investor Partners, new at also all about company valuing XX% take

initial As ongoing while original $XX Cannae we of this part or investment. position cash of million invested, a investment, the of the our that implied of XX% our value distribution XXX% capital represents received

last management Black XXth and is At job we team is off to both Bournemouth XXth a on like move next football. to year's done Knight than field. on Currently, in we ranked believe would terrific the and up I higher that. turn the transforming has Bournemouth, which can place, AFC our place, from team

ticketing sponsorship up Additionally, the XX% year-over-year with strong year-over-year XX% [indiscernible] up business XX% and hospitality approximately side year-over-year. up for very

football January, Black of that Club In the Hibernian premiere. purchased it a Knight announced minority Scottish in interest Football

value these help operating management excited shareholders. the be Hibernian teams We our like can Gordon our engaged and are partner to investments grow a strategy. companies, finding that believe strong family with will and believe drive partner for We we private to to with businesses acquire multi-cloud will where actively their contributor ownership

an to and second quarters. the the X.X% third quarter D&B's of acceleration first our X.X% from listed and quarter companies. on constant growth in the currency X.X% Moving in is from the

$X.X $X.X top of posted was the in $X.X over future line in and While value in had billion growth Alight million BPaaS under also XX% of X.X%, adjusted more billion $XX Life's revenue growth hit than target X-year contract contract. they set. revenue the and bookings billion has EBITDA total company XXXX that

is the portfolio that model life's We which on while profitability The can expand a valuable also life they a working this and review, recurring announced team morning. building we more with Stephen business. believe strategic revenue

approximately TRaSamine's starting Finally, quarter Massey Chairman result this XX% Rick year, of be the will going into as of third moving Vice fees a role. by forward in the reduced

and find continue shareholders To as our conclude, holds are high-return we rebalance future portfolio. our what and new with optimistic Cannae our buybacks for we share investments, gradually with very the

I'll have dual financial asset of the to will our Bryan share while net this our over Coy discount. effect higher position. touch turn call closing believe I NAV driving now to together, our price on to Taken value the

Bryan Coy

existing balance At the with and Cannae's liquidity to interest share. $XXX fixed million corporate $XXX at paid that that turn only asset Cannae our $X.XX short-term debt with was value matures session. the or compared $XX.XX today, and $XX down $X annually cash also is undrawn approximately $XX.XX and The presently million an strong under billion XXXX. is loan. near company payments. . or close under in the share invested Under margin per capacity cash million net the of we per investments, now Ryan. The revolver, Q&A amendment of Jana its million revolver operator $X.XX rate $XX the million of Cannae position of the end the the the of Cannae's back interest aggregate to call the Thanks, net saving third has I'll to quarter's X% transaction. approximately begin in outstanding

Operator

[Operator of Instructions] Lee Our first question Kenneth RBC Capital Markets. comes from

Kenneth Lee

Wonder could bit offer. a some talk of versus more have tender a on other options one First little you perceived. the for could you offer pursuing if the tender about the perhaps motivation

William Foley

buy shares, We we large transaction. share human bulk to for our to the also, blacked we first, they were shares by can transactions, do activities really, in, plan shares. out to various to in went Well, us repurchasing accelerate And we for we involved found or as points the day. example, program between can offer against. time the are a Jana becoming or we really were that number releases while tender we're large earnings execute share due a we repurchase to part limited And at block of per retire

this we offer in share at buyback with discount, trade our this So program, shares is quickly. that which like that's should what at is tender more accelerate doing the more price NAV just feel fact, point, to retire our and we

Kenneth Lee

of there And I in facilities, but bit mentioned the cash want around on you. get more potentially in using that. could loan some that be a to hand. color terms tender funding just the drawdown offer, little you Got then presume

William Foley

public a it sale a of of Yes, loan a sale margin securities, could continued liquid our or it could facility under be of some be of drawdown our securities. combination

now. right of $XXX hand on have We million about cash

short the only million at figure $XXX $XX this actually the in million on really have what we hand So bank point. of is

the really green those XX% expeditiously about we really a very and would raise we're can So be additional million, additional $XXX million, concerned if that an we $XX actually And that be $XX raising funds confident have shoe, will the which million. not easily. but we're of

Kenneth Lee

the Jana you could helpful and management of I another around of more any Board bit in in here. Got follow-up a detail and supporting little arrangements Wonder if the -- the voting kind ask terms of you partnership. And more a of there. you. the in bit Very talk Could detail terms little if terms about get that could just there. the

Unknown Executive

Yes.

we We're excited we both us partnership. incentivize will and release, acquisitions and with will in as a businesses. in AUM agreed and of terms view And this operating our Cannae, to of returns stock work are are we Jana. through work increasing voting proprietary ownership of sourcing, be cross businesses terms Jana. ours We noted believe we taking a in taking believe both it in of to benefit together, driving theirs So agreement in to They and we to to stock of as press a together. kind the

Kenneth Lee

Got you. for final if And me, may. just I one follow-up

structures a acquisitions of partnering in carve-outs. just look a the could flesh about control [indiscernible] like. on think terms wondering bit making how that some potential about you opportunities could with talked further of little out with you Jana, potential I and if You some of bit But mentioned

flesh Just on of How perhaps like? a some they could further or look could hypoesthetical if some you the just opportunities? wonder of other talk out

William Foley

Yes.

they're there's would raising that be really It's deck, I see no they is you Jana's think like A transactions ought from the them document each you very on. it. Jana transaction that but currently We this of interesting, with table. number one partners anticipate Ryan to There third-party could to investment a sources. that appear specific and funds we'll at year no that you if deck, on use be they've shared to and time. provide looking several to pending be a with transaction revealing look is at at take when occurring it'd you things that's us and to very

Kenneth Lee

possibility? Cannae Got if . also for in. one portfolio? you. portfolio could squeeze to I And that a in Is be any within more, the actually it Jana, Would companies just possible of perhaps the invest also

William Foley

is all companies on at table assets of sale portion terms sure of us really to portfolio alternative strategies transactions, or private different all Everything a of with the of in kinds with can they relative looking help some the I'm Jana. going of situations. our

Group Jana forward skilled investment really, to is group partnership. the professionals. So the of And very we a look

Operator

Instructions] Jonathan [Operator Stephens. . Base comes of Our next from question

Unknown Analyst

I time private the you do versus And of was the and address investment ignoring hoping forward? years? their you philosophy. today, have public spending out see potential of private could the over next as handful you size, do what the guys of the see moving investments majority team the efforts the having promising you most Where

Unknown Executive

we public more I in -- focused of Look, think are forward. private to going terms much versus on in investments private, going more -- be terms of

works better. it I think it's think a -- I

and in can leverage private it will at the I like public you'll is us public. but of what over businesses. time be than businesses reinvest we sell And has we how better If that permanent businesses, you our look and believe, capital, we and down names it looking the effectively think capital have, those most we to private think the Cannae see

just in don't it I terms of say portfolio a have perfect that because private businesses then but And about today, have talking answer, we before. we the were of I'll

that a Black you the you've about of results heard at think and little Bournemouth I Knight some bit football. seen

successes. going that that business We furthermore, the that. to both build there's believe terms as we able we've that we and had side multi-club forward, the side. -- -- that we to continue think network we'll those In of And the more -- in value we building are we'll be success that believe football the extract from out,

very think the the and done what excited big very we're we going excited forward. upside there's about We're So to has investment. about team date,

William Foley

something look was back investments, that if public private really that into a also, they're of public you assets. our converted And company at result

we private then that sponsored. company. company was -- still it that position company took [indiscernible], into transaction, that Dayforce we and public, So our of result it's we a that engaged And in a of private the was a in Ceridian in going or via converted long-term have had course, Alight public a SPAC a small and down investment that that and a then it number our was shares. to a as in private And years sponsor the for up was same years a of participated we went of and interest were and to . Paysafe, began we're years. disposing we public, Dayforce, transaction with in fairly and SystemX. again, SPAC

as public that company out we've generally asset, that So assets really, assets a our acquired have into company started company. converted private private public

Unknown Analyst

Ryan's touching point multi-club the on And Okay. on strategy. there, last

With makes what you the sense, be is the it strategy, new can why multi-club Hibernian, it it in stake successful? highlight maybe and why can minority

William Foley

But equity with the found, and got we also transfer involved work other very good those in. the is League league interest and a league U.K. And players owners, Scotland with It's in Bournemouth. advantageous as in developed Scottish Well, owners, to window of the of funds football terms in having that the we league. players can to in top compete to terrific we their a is in leagues clubs. also League private It's the -- Premier there's in Premier football world difficult that best the clubs [indiscernible]. own obviously, investment interest the down the firms to wealth and lot loaning obviously, a They sovereign no and as is way immigration regard issue acquiring players as

to and Scottish in a Laurent, the on that thing players recently, true Premier is X rotate we English to loaned Premier same give do actually And we can is again, in so eventually And And League is, [indiscernible], Hibernia with the back they we with to team, playing that the which in other owners. France. League. took paying of we the EC player FC to player can XX% loan other is a develop we in them XX% league and had acquired if League back team, own Dango Atara, piece the just we player, say now when And buy own for last you that are really another One And a January. the the of result we only Bornemouth. a [indiscernible] year, at is, player

the a pyramid [indiscernible] couple it be in and in and frankly up situation Premier it's right the also advantageous transfer in is a players say supportive And of So the their [indiscernible]. terms invest of we that the that helping and table we're them in League. to more delivering like financially to supporting make supporting very and we the are develop which at window. you'd teams strategically in be goal continue the Bournemouth develop And and now, other of coordinating play, in leagues other But our of our sits manner on in. the to have clubs -- move to and teams top could them to coordinate

really it's a last it's invested over clubs and now the they're XX has Manchester or City a or developed they model, XX it's not XX in. XX and really original an So that years, have

will clubs, more never that but many have be a we So few interesting. would

Operator

any Mr. question-and-answer back concludes to like This turn I conference our would Foley over remarks. session. to closing Bill for the

William Foley

Yes. Thank operator. you,

are to our great XXXX strategy quarter our we with our excited to as transform you our confident a look and with forward deliver in portfolio, the first call. ahead on we day. We value very shareholders. believe earnings which again speaking opportunities We Have will

Operator

for attending presentation. conference today's has The Thank concluded. now you

may disconnect. You now

Cannae (CNNE) 21 Feb 242023 Q4 Earnings call transcript