• Total Operating Revenue: $110 million, an 8% decrease from the 2023 comparable period.
• Dun & Bradstreet Revenue: $632 million for Q4 2024, with less than 1% constant currency organic growth.
• Dun & Bradstreet Adjusted EBITDA: $260 million for Q4 2024, down $0.6 million from the prior year's Q4.
• Alight Revenue: $680 million for Q4 2024, a 0.3% decrease from Q4 2023.
• Alight Adjusted EBITDA: $217 million for Q4 2024, a 5% increase from Q4 2023.
• Restaurant Operating Expenses: $107 million for Q4 2024, 81% of total operating expenses, 300 basis points lower than Q4 2023.
• Cost of Restaurant Revenue: $90 million, 89% of restaurant revenue, a 20-basis-point improvement over the prior year Q4.
• Net Losses from Equity Method Investments: $12 million in Q4 2024, a reduction from the prior year.
• Corporate Cash and Short-term Investments: Over $108 million.
• Net Asset Value: Approximately $1.9 billion, equating to $2,978 per Cannae share on an after-tax basis.

• Warning! GuruFocus has detected 7 Warning Signs with CNNE.

Release Date: February 24, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Cannae Holdings Inc (NYSE:CNNE) has implemented a strategic plan to increase net asset value (NAV) and narrow the discount to intrinsic value, which includes improving portfolio company performance and making new investments.
• The company successfully worked with Alight on a $1.2 billion sale, simplifying its business and providing capital for share repurchases and dividends.
• AFC Bournemouth, part of Cannae's portfolio, achieved significant revenue growth and its highest-ever Premier League ranking, indicating strong operational performance.
• Cannae Holdings Inc (NYSE:CNNE) made several new private investments in 2024, including a 20% equity interest in JANA Partners and a majority stake in Watkins Company, both expected to generate high returns.
• The company returned significant capital to shareholders through share repurchases and a newly initiated quarterly dividend, demonstrating a commitment to shareholder value.

Negative Points

• Dun & Bradstreet reported lower-than-expected revenue growth and adjusted EBITDA for the fourth quarter of 2024, affected by delayed deals and strategic exits.
• Cannae Holdings Inc (NYSE:CNNE) experienced an 8% decrease in total operating revenue for the fourth quarter, primarily due to lower restaurant revenue and sector headwinds.
• The company recognized losses from the sale of shares in Alight and Paysafe, although these were offset by tax benefits.
• Cannae Holdings Inc (NYSE:CNNE) has a net debt position of approximately $60 million, with a weighted average interest rate of 7.35%, which could impact financial flexibility.
• The company is still working towards covering its dividend and operating expenses through cash flow, indicating a need for improved cash generation from investments.

Q & A Highlights

Q: Could you discuss the potential financial impact of AFC Bournemouth qualifying for European competitions like the Champions League or Europa League? A: Ryan Caswell, President of Cannae Holdings Inc, explained that qualifying for European competitions could significantly impact AFC Bournemouth financially. This includes additional media revenue and match day revenues from hosting extra matches. More importantly, it would enhance the club's enterprise value and credibility, showcasing its potential as a mid- to upper-table Premier League team.

Q: How close is Cannae Holdings to funding its dividend through cash flow from its investments? A: Ryan Caswell noted that while they are not yet covering the dividend and operating expenses through cash flow, it remains a focus. The company is working on generating cash flow from investments to cover these costs and is considering rebalancing its portfolio to prioritize stock buybacks.

Q: What is Cannae Holdings' approach to share buybacks, and how does it depend on the company's stock price? A: Ryan Caswell stated that share buybacks are a priority for Cannae Holdings, especially if the stock is perceived as undervalued. The extent of buybacks will depend on potential monetization events of their holdings, such as the ongoing strategic review of Dun & Bradstreet, and the company's stock price.

Q: Can you provide more details on the capital funding needs for Black Knight Football, particularly AFC Bournemouth? A: Ryan Caswell mentioned that AFC Bournemouth's capital needs include player sales and infrastructure improvements like stadium and training facilities. While additional capital will be invested, it will be less than in the past, focusing on maintaining sporting performance and growing the team's enterprise value.

Q: What are the strategic plans for Cannae Holdings' investment in Alight, especially after Bill Foley stepped down as Chairman? A: Ryan Caswell clarified that Bill Foley remains on Alight's Board and is involved in its strategic direction. Cannae Holdings continues to support Alight, believing in its strategic positioning and potential for success following management and board changes. The company is open to strategic transactions but focuses on Alight's standalone success.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.