Stewart Information Services Corp (STC) 2022 Q2 法說會逐字稿

Hello, and thank you for joining the Stewart Information Services Second Quarter 2022 Earnings Call. (Operator Instructions) Please note today's call is being recorded. (Operator Instructions)

您好，感謝您參加斯圖爾特信息服務公司 2022 年第二季度財報電話會議。 （操作員說明）請注意今天的通話正在錄音。 （操作員說明）

It is now my pleasure to turn today's conference over to Brian Glaze, Chief Accounting Officer. Please go ahead.

現在我很高興將今天的會議交給首席會計官 Brian Glaze。請繼續。

Thank you, Shelby. Thank you for joining us today for Stewart's Second Quarter 2022 Earnings Conference Call. We will be discussing results that were released yesterday after the close. Joining me today are CEO, Fred Eppinger; and CFO, David Hisey. To listen online, please go to the stewart.com website to access the link for this conference call.

謝謝你，謝爾比。感謝您今天加入我們參加斯圖爾特 2022 年第二季度收益電話會議。我們將討論昨天收盤後公佈的結果。今天加入我的是首席執行官 Fred Eppinger；和首席財務官大衛·希西。要在線收聽，請訪問 Stewart.com 網站以訪問此電話會議的鏈接。

I will remind participants that this conference call may contain forward-looking statements that involve a number of risks and uncertainties. Because such statements are based on an expectation of future financial operating results and are not statements of fact, actual results may differ materially from those projected. The risks and uncertainties forward-looking statements are subject to include, but are not limited to, the risks and other factors detailed in our press release published yesterday evening and in the statements regarding forward-looking information, risk factors and other sections of the company's Form 10-K and other filings with the SEC.

我會提醒與會者，本次電話會議可能包含涉及許多風險和不確定性的前瞻性陳述。由於此類報表基於對未來財務運營結果的預期而非事實陳述，因此實際結果可能與預測結果大不相同。前瞻性陳述的風險和不確定性包括但不限於我們昨天晚間發布的新聞稿以及關於前瞻性信息、風險因素和公司其他部分的陳述中詳述的風險和其他因素向 SEC 提交的 10-K 表格和其他文件。

Let me now turn the call over to Fred.

現在讓我把電話轉給弗雷德。

Thank you for joining us today for Stewart's Second Quarter 2022 Earnings Conference Call. David will go over the quarterly financial results in a minute. But before that, I'd like to cover our overall view of Stewart and our position in the current market.

感謝您今天加入我們參加斯圖爾特 2022 年第二季度收益電話會議。大衛將在一分鐘內查看季度財務結果。但在此之前，我想介紹一下我們對斯圖爾特的總體看法以及我們在當前市場中的地位。

As I have discussed before, much of the work here at Stewart over the last 2 years is focused on restructuring, refocus and rebuilding the company's operations to better position ourselves to be a more successful and resilient company that ultimately can be come to what we refer to as the premier title services company. The goal is to create a sustainable business that performs through all types of real estate cycles and economic conditions. We have focused on improving margins, generating growth and creating a stronger competitive position by improving our scale, improving our operational capabilities and our financial discipline.

正如我之前所討論的，過去 2 年斯圖爾特的大部分工作都集中在重組、重新聚焦和重建公司的運營，以更好地定位自己，成為一家更成功、更有彈性的公司，最終可以成為我們所指的公司成為首屈一指的產權服務公司。目標是創建一個可持續發展的企業，在所有類型的房地產週期和經濟條件下都表現出色。我們專注於通過擴大規模、提高運營能力和財務紀律來提高利潤率、促進增長並創造更強大的競爭地位。

As part of our journey, we are focused on enhancing the customer experience through technology investments that have meaningfully changed our ease of use and expanded our product offerings in our agency, lender and direct business. I am pleased with the progress we made and demonstrated in the second quarter as we maintain strong margins and continue to make progress on our operating priorities in a more challenging market.

作為我們旅程的一部分，我們專注於通過技術投資來提升客戶體驗，這些投資有意義地改變了我們的易用性，並擴大了我們在代理、貸方和直接業務中的產品供應。我對我們在第二季度取得和展示的進展感到高興，因為我們保持了強勁的利潤率，並在更具挑戰性的市場中繼續在我們的運營重點方面取得進展。

We have seen the market transition to a higher interest rate environment. The interest rate increases have put significant pressure on refinance transactions, which have been historically less -- less dependent on and to a lesser extent, purchase transaction. So we expect that the current environment will continue throughout the second half of 2022. While it's a more challenging environment, Stewart, because of our significant improvement, is well prepared to successfully manage through these market changes. I'd like to emphasize that even though the market has transitioned, our journey continues. We remain focused on our structural improvement, attaining critical scale in priority markets, aided by the leading technology support and innovation to drive superior and consistent service delivery to our customers.

我們已經看到市場向高利率環境過渡。加息給再融資交易帶來了巨大壓力，從歷史上看，再融資交易對購買交易的依賴程度較低，並且在較小程度上依賴於購買交易。因此，我們預計當前環境將持續到 2022 年下半年。雖然環境更具挑戰性，但由於我們的顯著改進，斯圖爾特已做好充分準備，成功應對這些市場變化。我想強調的是，即使市場已經轉變，我們的旅程仍在繼續。我們仍然專注於我們的結構改進，在優先市場達到關鍵規模，借助領先的技術支持和創新，為我們的客戶提供卓越和一致的服務。

To achieve our goal of becoming the premier title services company, we recognize that we must continue to make thoughtful investments even in this environment. In our direct operation, share growth remains our important goal in our overall strategy in target MSA markets.

為了實現成為一流產權服務公司的目標，我們認識到即使在這種環境下，我們也必須繼續進行深思熟慮的投資。在我們的直接運營中，份額增長仍然是我們在目標 MSA 市場的整體戰略中的重要目標。

Over the last couple of years, we have focused on more than 20 regional title companies -- acquisitions of 20 regional title companies and are always evaluating opportunities to deploy available capital. We are hard at work integrating these acquisitions into our production and other systems to improve the customer experience as well as improve the overall operating efficiencies that we will be building over the last few years.

在過去的幾年裡，我們專注於 20 多家地區產權公司——收購了 20 家地區產權公司，並且一直在評估部署可用資本的機會。我們正在努力將這些收購整合到我們的生產和其他系統中，以改善客戶體驗並提高我們將在過去幾年中建立的整體運營效率。

Above all, we are managing our business in a disciplined way given the current environment that never stops. In our agency business, we have made significant progress on our deployment of technology and service that provide greater connectivity, ease of use and risk reduction for our agent partners. As the industry accelerates the implementation of online and (inaudible) transactions, we are identifying ways to better support our agents as they undergo the critical transition. We believe our opportunity to grow scale in our growth markets and improve our share with winning independent agents is on a very solid path forward.

最重要的是，鑑於當前永無止境的環境，我們正在以有紀律的方式管理我們的業務。在我們的代理業務中，我們在技術和服務的部署方面取得了重大進展，為我們的代理合作夥伴提供了更大的連接性、易用性和降低風險。隨著行業加速在線和（聽不清）交易的實施，我們正在尋找方法來更好地支持我們的代理，因為他們正在經歷關鍵的過渡。我們相信，我們有機會在我們的增長市場擴大規模，並通過贏得獨立代理商提高我們的份額，這是一條非常穩固的前進道路。

We are seeing revenue growth in our commercial operations, and we are investing in these operations for the future as they are an important component of our overall strategy. We are optimistic regarding the commercial markets overall, although the tougher capital markets may create some temporary headwinds in some parts of the country. To be clear, there is more work to be done as we maintain our focus on growing and enhancing our competitive position, improving scale and operating capabilities.

我們看到商業運營的收入增長，我們正在為未來投資這些業務，因為它們是我們整體戰略的重要組成部分。我們對整體商業市場持樂觀態度，儘管更為嚴峻的資本市場可能會在該國某些地區造成一些暫時的不利因素。需要明確的是，隨著我們繼續專注於發展和增強我們的競爭地位、提高規模和運營能力，還有更多工作要做。

We recognize that maintaining customer service levels a fundamental part of who Stewart is, while also managing expenses is more important than ever. Even if these changing market conditions, we still see opportunities to invest and grow share in our target market allowing us to profitably grow throughout the cycle.

我們認識到保持客戶服務水平是 Stewart 的基本組成部分，同時管理費用比以往任何時候都更加重要。即使這些不斷變化的市場條件，我們仍然看到在目標市場投資和增加份額的機會，使我們能夠在整個週期中實現盈利增長。

Let me just finish by reiterating my positive long-term view of the real estate market and our ability to continue to grow and become the premier title services company. I would also like to thank our associates for all their hard work and our customers for their continued support.

最後，讓我重申我對房地產市場的積極長期看法以及我們繼續發展並成為一流產權服務公司的能力。我還要感謝我們的員工的辛勤工作和客戶的持續支持。

Dave will now update everyone on the results.

戴夫現在將向所有人更新結果。

Thank you, Fred, and good morning. Let me also thank our associates for their amazing service and our customers for their trust and support.

謝謝你，弗雷德，早上好。我還要感謝我們的員工提供的出色服務以及客戶的信任和支持。

Moving into the middle of the home buying season, the residential market has been negatively impacted by 30-year mortgage rates persistently above 5% and slowing home sales and housing starts. Consumer settlement has worsened due to the inflation and affordability and recession concerns, however, employment rates remain steady.

進入購房季節中期，住宅市場受到 30 年期抵押貸款利率持續高於 5% 以及房屋銷售和房屋開工放緩的負面影響。由於通貨膨脹和負擔能力以及對經濟衰退的擔憂，消費者結算情況惡化，但就業率保持穩定。

Commercial real estate saw good activity in the quarter. However, rising rates in dollar capital markets are beginning to influence transactions. For the second quarter, Stewart reported net income of $62 million and diluted earnings per share of $2.26 on revenues of $844 million. After adjustments, primarily for net unrealized gains and losses on equity securities with June's equity sell-off, adjusted net income for the second quarter was $70 million or $2.58 per diluted share compared to $86 million or $3.17 per diluted share in last year's quarter.

商業地產在本季度表現良好。然而，美元資本市場的利率上升開始影響交易。第二季度，斯圖爾特報告淨收入為 6200 萬美元，每股攤薄收益為 2.26 美元，收入為 8.44 億美元。調整後，主要針對 6 月份股票拋售的股票證券未實現淨損益，第二季度調整後的淨收入為 7000 萬美元或稀釋後每股收益 2.58 美元，而去年同期為 8600 萬美元或稀釋後每股收益 3.17 美元。

Total title revenues for the second quarter increased $17 million or 2% and compared to last year's quarter, primarily due to better results for our agency and commercial operations, which was partially offset by lower residential revenues on reduced transaction. The title segment's pretax income for the second quarter was $94 million compared to $126 million in the prior year quarter.

與去年同期相比，第二季度的總產權收入增加了 1700 萬美元或 2%，這主要是由於我們的代理和商業運營取得了較好的業績，但部分被交易減少導致的住宅收入下降所抵消。第二季度產權部門的稅前收入為 9400 萬美元，而去年同期為 1.26 億美元。

Segment pretax margin for the second quarter was 12.3% compared to 16.7% in the second quarter of 2021, primarily due to the effects of the fair value changes in equity securities, lower residential volume and the investments we are making to grow revenue, improve customer service and reduce title production costs, as Fred mentioned in his opening remarks.

第二季度的分部稅前利潤率為 12.3%，而 2021 年第二季度為 16.7%，主要是由於股權證券的公允價值變化、住宅數量減少以及我們為增加收入、改善客戶而進行的投資的影響正如 Fred 在開場白中提到的那樣，服務並降低標題製作成本。

In regard to our direct title business, domestic commercial revenues improved $13 million or 25% as a result of higher transaction volume across most asset classes and a 17% higher average fee per file of $13,100. Domestic residential revenues decreased $11 million or 5%, driven by lower purchase and refinancing transactions in the second quarter of 2022. Residential fee per file for the quarter was approximately $2,900 versus $2,200 last year due to the higher purchase mix.

在我們的直接產權業務方面，由於大多數資產類別的交易量增加以及每份文件的平均費用增加 17%，達到 13,100 美元，國內商業收入增加了 1300 萬美元或 25%。由於 2022 年第二季度購買和再融資交易減少，國內住宅收入減少了 1100 萬美元或 5%。由於購買組合增加，本季度每份文件的住宅費用約為 2,900 美元，而去年為 2,200 美元。

Total international revenues in the second quarter were $4 million or 8% lower compared to last year, primarily due to lower transaction volumes in our Canadian operations. Total open and closed orders in the second quarter both declined by 28%, primarily due to the elevated interest rate environment.

與去年相比，第二季度的國際總收入減少了 400 萬美元或 8%，這主要是由於我們加拿大業務的交易量減少。第二季度未結訂單和已結訂單總額均下降 28%，主要是由於利率環境升高。

Our agency operations generated another solid quarter with revenues of $410 million, 5% higher than last year. The average agency remittance rate slightly decreased to 17.1% from 17.5%, primarily due to geographic mix.

我們的代理業務又創造了一個穩健的季度，收入為 4.1 億美元，比去年增長 5%。平均代理匯款率從 17.5% 略微下降至 17.1%，主要是由於地域混合。

On title losses, total title loss expense in the second quarter decreased by $7 million or 21% from last year's quarter, primarily due to our overall favorable claims experience, partially offset by higher total title revenue. As a percentage of title revenues, the title loss expense in the second quarter of 2022 was 3.5% compared to 4.5% last year. For the full year 2022, we anticipate our title losses will be approximately 4% of title revenues.

在產權損失方面，第二季度的總產權損失費用比去年同期減少了 700 萬美元或 21%，這主要是由於我們整體有利的索賠經驗，部分被更高的總產權收入所抵消。作為產權收入的百分比，2022 年第二季度的產權損失費用為 3.5%，而去年為 4.5%。對於 2022 年全年，我們預計我們的產權損失將約為產權收入的 4%。

Regarding our real estate solutions segment, which we began to break out last quarter, pretax income improved by $4 million compared to last year due to the acquisitions completed towards the end of last year. Pretax margin was 7.4% for the second quarter 2022, 14.7% prior to purchase amortization compared to 3.8% and 6.6%, respectively, in the second quarter of 2021. It's important to note that these businesses are also impacted by mortgage and real estate volumes, each one slightly differently, and so you should expect to see some of what we see in title also in the real estate solutions business, the impact by the market.

關於我們上個季度開始突破的房地產解決方案部門，由於去年底完成的收購，稅前收入與去年相比增加了 400 萬美元。 2022 年第二季度的稅前利潤率為 7.4%，購買攤銷前為 14.7%，而 2021 年第二季度分別為 3.8% 和 6.6%。值得注意的是，這些業務也受到抵押貸款和房地產交易量的影響，每一個都略有不同，因此您應該期望看到我們在標題中看到的一些內容，也在房地產解決方案業務中受到市場的影響。

In regard to operating expenses, which consist of employee and other operating costs, total operating expenses for the quarter increased mainly due to increased variable costs related to revenue and higher employee count. Employee costs as a percentage of operating revenues for the second quarter was 25% compared to 24% last year. While second quarter other operating expenses were higher at 19% of operating revenues compared to 17% last year due to the increased size of our real estate solutions operations, which typically have higher other operating expenses due to third-party services.

關於由員工和其他運營成本組成的運營費用，本季度的總運營費用增加主要是由於與收入相關的可變成本增加和員工人數增加。第二季度員工成本佔營業收入的百分比為 25%，而去年為 24%。由於我們的房地產解決方案業務規模擴大，第二季度其他運營費用佔營業收入的 19% 高於去年的 17%，而第三方服務通常具有更高的其他運營費用。

On other matters, our financial position provides strong support for our customers, employees and the real estate market. Our total cash and investments on the balance sheet are approximately $557 million over regulatory requirements, and we have a fully available $200 million on a credit facility.

在其他方面，我們的財務狀況為我們的客戶、員工和房地產市場提供了強有力的支持。我們在資產負債表上的總現金和投資超過監管要求約 5.57 億美元，我們有 2 億美元的全部可用信貸額度。

As of June 30, 2020, stockholders' equity attributed to Stewart was approximately $1.35 billion, and our book value per share was approximately $50, an increase of 5% from December 31, 2021.

截至 2020 年 6 月 30 日，歸屬於斯圖爾特的股東權益約為 13.5 億美元，我們的每股賬面價值約為 50 美元，較 2021 年 12 月 31 日增長 5%。

Lastly, net cash provided by operations for the second quarter was $83 million, compared to $103 million in last year's quarter, primarily due to lower net income in the second quarter of 2022. We are always grateful for and inspired by our customers and associates, we advocate for everybody's improved safety and prosperity and are confident in our support of real estate markets.

最後，第二季度運營提供的淨現金為 8300 萬美元，而去年同期為 1.03 億美元，這主要是由於 2022 年第二季度的淨收入下降。我們一直對我們的客戶和員工表示感謝和鼓舞，我們倡導提高每個人的安全和繁榮，並對我們對房地產市場的支持充滿信心。

I'll now turn it back to the operator for questions.

我現在將其轉回給接線員提問。

(Operator Instructions) And we'll take our first question from Bose George with KBW.

（操作員說明）我們將回答 Bose George 和 KBW 的第一個問題。

Actually, first, I wanted to ask just about investment income. What's a good run rate for that number? And the increase this quarter, was that just reflecting the increase in market rates?

其實，首先，我想問的是投資收益。該數字的良好運行率是多少？而本季度的增長，僅僅是反映了市場利率的增長嗎？

Yes, that's a good question. So the -- we have seen a slight increase due to the rise in rates. We also, in the quarter, we get dividends from different title plants and things like that. And so we had some growth in some of that activity. So it's really a combination of some of those dividends and the interest rate environment. I think on your question on run rate, probably somewhere in the $5 million to $6 million, probably closer to -- well, it depends on what happens with rates from here, but I think sort of that 5% to 6% is probably a good number.

是的，這是個好問題。因此，由於利率上升，我們看到了輕微的增長。我們還在本季度從不同的所有權工廠和類似的東西中獲得股息。因此，我們在其中一些活動中取得了一些增長。因此，這實際上是其中一些紅利和利率環境的結合。我認為關於您關於運行率的問題，可能在 500 萬美元到 600 萬美元之間，可能更接近 - 嗯，這取決於從這裡開始的費率會發生什麼，但我認為 5% 到 6% 可能是好數字。

Okay. Great. And then can you just talk about trends you're seeing in July in both in the purchase and in the commercial market?

好的。偉大的。然後你能談談你在 7 月份看到的購買和商業市場的趨勢嗎？

Yes. So it's David again. So on commercial, the market, I would say, is probably transitioning a little bit like what we saw maybe 6 months or so in residential not to that degree because there's still a lot of activity. So even though we continue to see increases in open orders, we hear from customer feedback that transactions are taking a little longer to execute. And so I guess I would just describe the market is still good, but transitioning and starting to be impacted by the capital markets and interest rate environment.

是的。所以又是大衛。所以在商業方面，我會說，市場可能正在轉變，就像我們在住宅中看到的可能 6 個月左右的情況，而不是那種程度，因為仍然有很多活動。因此，儘管我們繼續看到未結訂單增加，但我們從客戶反饋中得知，交易需要更長的時間才能執行。所以我想我只會描述市場仍然很好，但正在過渡並開始受到資本市場和利率環境的影響。

We will take our next question from John Campbell with Stephens Inc.

我們將回答 John Campbell 和 Stephens Inc. 的下一個問題。

Just a big picture question here, maybe for you, Fred or David, either one of you guys, but you guys have talked to the 10% total company pretax margin in the past. I know you've got some more pressure building on the purchase side of the market, and there's obviously a lot of moving parts that kind of lead up to that 10%. But based on what you're seeing today and what you're kind of expecting, do you think you can manage that 10% mark this year and maybe even next?

這裡只是一個大問題，也許是對你們，弗雷德或大衛，你們中的任何一個，但你們過去曾談到公司 10% 的總稅前利潤率。我知道你在市場的購買方面承受了更多的壓力，而且顯然有很多活動部件會導致這 10%。但根據你今天所看到的和你所期待的，你認為今年甚至明年你能達到 10% 的目標嗎？

Yes. It's a great question. I mean that's exactly what I believe. We -- if you look at the trend for us, we were -- our margins were about 4.5% in '19, about 6.5% in '20. Obviously, in '21, it was about 12.5% for the company. And I always say there's likely 200 basis points in that number in '21 because it was so extremely a good number. And the good company didn't really staff off. You used a lot over time so your same-store sales were extraordinary. And you couldn't sustain that from a work management point of view, but it inflated just everybody's margins and now we're settling into a more normal market. And so I believe that we're that much better. I think we are double digit -- low double-digit kind of margin company, maybe. It could be a high single in some quarter. But I feel pretty good that we've had a structural improvement in the institution. Now we got to manage ourselves to do that but we are a solidly better company now.

是的。這是一個很好的問題。我的意思是這正是我所相信的。我們——如果你看看我們的趨勢，我們是——我們的利潤率在 19 年約為 4.5%，在 20 年約為 6.5%。顯然，在 21 年，該公司的比例約為 12.5%。我總是說 21 年這個數字可能有 200 個基點，因為這是一個非常好的數字。好公司並沒有真正裁員。隨著時間的推移，您使用了很多，因此您的同店銷售額非常驚人。從工作管理的角度來看，你無法維持這一點，但這只會誇大每個人的利潤，現在我們正在進入一個更正常的市場。所以我相信我們要好得多。我認為我們是兩位數——也許是低兩位數的利潤率公司。它可能是某個季度的高單曲。但我感覺很好，我們的機構有了結構性的改進。現在我們必須管理自己才能做到這一點，但我們現在是一家更好的公司。

Okay. That's helpful. And then, David, on the reserve ratio, 3.5% this quarter. I think in the press release, you had mentioned 4% for the full year. So maybe implying a little bit of a step up in the back half. Is that out of conservatism? Or are you seeing something maybe in the back book that leads you to kind of project that up for the back half?

好的。這很有幫助。然後，大衛，關於準備金率，本季度為 3.5%。我認為在新聞稿中，您提到了全年的 4%。所以也許意味著在後半部分有點進步。這是出於保守主義嗎？或者你是否在後半部分看到了一些可能會引導你完成後半部分的項目的東西？

No, we're not really seeing any pickup in the claims rate or anything like that. I think it's just when we sort of look at our actuarial work and the fact that we're at the higher end of the range, that might have been forward where we ended up in the second quarter. We just think that, that's probably a more -- something more reflective of the run rate of title losses, and so that's where we settled on the 4%.

不，我們並沒有真正看到索賠率或類似情況出現任何回升。我認為只是當我們審視我們的精算工作以及我們處於該範圍的高端這一事實時，這可能會在我們在第二季度結束的地方向前發展。我們只是認為，這可能更多——更能反映冠軍損失的運行率，所以這就是我們確定 4% 的地方。

Okay. That's helpful. And then if I could squeeze in maybe just one more here. I know -- I think you guys sold the Coldwell Bain And so the nontitle rev stepped down a little bit sequentially. I think that was the driver of that. But I'm curious about what remains in the real estate solutions segment. If you can maybe help us kind of size up the mix between recurring and transactional revenue there as you see it today?

好的。這很有幫助。然後，如果我能擠進去，也許就在這裡。我知道 - 我認為你們賣掉了 Coldwell Bain 所以無標題的版本依次下降了一點。我認為這是驅動因素。但我很好奇房地產解決方案領域還剩下什麼。如果您能像您今天看到的那樣幫助我們確定經常性收入和交易收入之間的組合嗎？

Yes. Well, I mean, the businesses that are in that segment are valuation businesses. So like I said in my remarks, that those are impacted by what happens in the origination market. And we've got informative research, that's a credit-related business. It has both things that are highly sensitive to originations on the ordering of credit report, but that it provides other credit analytics and the like that aren't as sensitive, but I would say it's predominantly sensitive in terms of its revenue mix.

是的。好吧，我的意思是，該領域的業務是估值業務。因此，就像我在講話中所說的那樣，這些都受到原始市場中發生的事情的影響。我們有信息研究，這是一項與信用相關的業務。它具有對信用報告排序的來源高度敏感的兩件事，但它提供了其他不那麼敏感的信用分析等，但我會說它在收入組合方面主要是敏感的。

PropStream is a little different. It's a subscription real estate service. I think it's not as sensitive, so we'll have to see. But when markets get a little tougher, that kind of information is very valuable for both investors and realtors for their prospecting. So it's probably not as sensitive to volumes.

PropStream 有點不同。這是一項訂閱房地產服務。我認為它沒有那麼敏感，所以我們必須看看。但是當市場變得更加艱難時，這種信息對於投資者和房地產經紀人的探礦都是非常有價值的。所以它可能對音量不那麼敏感。

And then we have some of our tools around mobile and digital notary. And that's all pretty sensitive to transaction volume and origination. So I would say, in general, it's pretty sensitive. I think I would just highlight that each of those businesses is a high-quality business and driven by entrepreneurial and excellent management teams. And so I think they will hold their own, if not better in the current market, and we're seeing that in the numbers.

然後我們有一些圍繞移動和數字公證人的工具。這對交易量和來源非常敏感。所以我想說，總的來說，它非常敏感。我想我只想強調，這些業務中的每一個都是高質量的業務，並由具有企業家精神和優秀管理團隊的驅動。所以我認為他們會堅持自己的，如果不是在當前市場上更好的話，我們在數字中看到了這一點。

We'll take our next question from Geoffrey Dunn with Dowling & Partners.

我們將回答來自 Dowling & Partners 的 Geoffrey Dunn 的下一個問題。

A couple of questions. I wanted to revisit your comments on commercial. So rewind 6 months in resi, things are starting to take a bit longer. You're seeing more purchase deals pop up than refi. Are there more legs from a mix shift standpoint with respect to the fee per file? Or are you also seeing that kind of the deal size, deal mix stabilize. So maybe if volumes do slow, we don't get as much offset on the fee per file side.

幾個問題。我想重新審視你對商業的評論。因此，在 resi 中倒帶 6 個月，事情開始需要更長的時間。您會看到彈出的購買交易比 refi 更多。從混合輪班的角度來看，每個文件的費用是否有更多的腿？或者您是否也看到這種交易規模，交易組合穩定。因此，也許如果卷確實變慢，我們在每個文件方面的費用就不會得到那麼多的抵消。

Yes. No, it's a great question, Geoffrey, a great observation. Yes, I would just say that we up until now, we've been seeing pretty good strength across all the real estate asset classes. Obviously, the bigger transactions, whether they're energy, multiuse, big multifamily. Those are the kinds of things that have been pretty active and have driven a higher fee per file. We've been also fortunate that in local markets, there's been pretty good activity with smaller strip centers, buildings, that kind of thing.

是的。不，這是一個很好的問題，杰弗裡，一個很好的觀察。是的，我只想說，到目前為止，我們在所有房地產資產類別中都看到了相當不錯的實力。顯然，更大的交易，無論是能源、多用途、大型多戶型。這些都是非常活躍的事情，並推動了每個文件的更高費用。我們也很幸運，在當地市場，小型地帶中心、建築物之類的活動非常活躍。

But the larger transactions clearly influence the fee per file more. I think looking forward, I think we're just going to have to see. I think you could see a little more pressure on the bigger transactions because those are the ones that typically financed in the capital markets in a sort of an interesting situation, right, that even though the capital markets are more volatile, financing costs are going up, at some point, that should probably have an influence on cap rates, which may sort of help valuations a little bit.

但較大的交易顯然對每個文件的費用影響更大。我認為展望未來，我認為我們將不得不看到。我認為您可能會看到較大交易的壓力更大，因為這些交易通常在一種有趣的情況下在資本市場上融資，對，即使資本市場更加波動，融資成本也在上升，在某些時候，這可能會對上限利率產生影響，這可能會對估值有所幫助。

So I would just say that it's sort of early in the -- in whatever might be transitioning in commercial. But as it stands now and from what we hear from customers, the market volatility and the higher rates are definitely influencing how people think about deals.

因此，我只想說，這在商業上可能發生的任何過渡中都處於早期階段。但就目前的情況以及我們從客戶那裡聽到的情況來看，市場波動和更高的利率肯定會影響人們對交易的看法。

Okay. Technical question with respect to your investment income. I've seen this, I think at another company in the past. Second quarter, is that typically when you're getting these title plant dividends, so maybe on a recurring annual basis, an extra $1 million, $1.5 million in Q2 NII?

好的。關於您的投資收益的技術問題。我見過這個，我想過去在另一家公司。第二季度，通常是當您獲得這些產權工廠股息時，所以可能在每年經常性的基礎上，額外 100 萬美元，第二季度 NII 中的 150 萬美元？

That's right. It is typically the second quarter. And I would say there's probably a little bit more activity, but the number you said is in the ballpark for sure.

這是正確的。通常是第二季度。我會說可能會有更多的活動，但你說的數字肯定在球場上。

Okay. And then last question. I think you mentioned that staffing was up. I don't know if that was just on a year-over-year basis with acquisitions or if you added staffing in the quarter, can you just talk about what your recent staffing trends have been? And how you are setting the company up in the back half of the year, particularly, Fred, given all the work you've had of getting all the right people into the right places, getting everybody on the same page, building scale in certain markets, it seems like maybe it might be a bit more challenging to adjust staffing after effectively a 2-year restructuring on maybe how the company approaches certain areas of the market. So can you just elaborate on that?

好的。然後最後一個問題。我想你提到人手已經增加了。我不知道這是否只是與去年同期相比的收購，或者您是否在本季度增加了人員，您能否談談您最近的人員配置趨勢？以及你在下半年是如何建立公司的，特別是弗雷德，考慮到你所做的所有工作，讓所有合適的人進入合適的地方，讓每個人都在同一個頁面上，在一定程度上擴大規模市場上，似乎在對公司如何接近某些市場領域進行了有效的兩年重組之後，調整人員配置可能更具挑戰性。那你能詳細說明一下嗎？

Yes, sure. So obviously, we've built -- in the services business, we've actually built up quite a bit and in some of the title geographies we've built up kind of a year-over-year thing. So you see that. Obviously, we have to be very thoughtful right now about managing and we're taking targeted actions in various businesses where we need to balance staffing resources. But to your point, I feel good about where we are and our talent. We just have to be thoughtful about incremental investment and targeted investment right now. It's a little bit uncertain to the market, obviously, and we just have to manage ourselves well.

是的，當然。很明顯，我們已經建立了 - 在服務業務中，我們實際上已經建立了很多，並且在一些標題地區，我們已經建立了一種逐年增長的東西。所以你看到了。顯然，我們現在必須在管理方面非常周到，並且我們在需要平衡人力資源的各種業務中採取有針對性的行動。但就你而言，我對我們所處的位置和我們的才能感覺很好。我們現在只需要考慮增量投資和定向投資。顯然，這對市場來說有點不確定，我們只需要管理好自己。

But as far as our talent level, I couldn't be more pleased as far as how we're situated. David referred to in some of our services businesses. I just feel great about the quality of those operations and what we're doing there. And so again, it's one of those interesting times, right? It's a transition in market, obviously, interest rates are up, but it's also uncertain.

但就我們的人才水平而言，我對我們所處的位置感到非常滿意。大衛在我們的一些服務業務中提到。我對這些操作的質量以及我們在那裡所做的事情感到非常滿意。再說一次，這是那些有趣的時代之一，對吧？這是市場的轉變，顯然，利率上升，但也不確定。

And so we have to be very, very thoughtful on how we invest and where we invest and how we manage our resources. And we will -- and again, to the question on our margin, obviously, last year was extraordinary. You're going to have a decrease in margins, but I think we're a lot better. And as I said from the beginning, we can sustain the high single digits, kind of low double-digit margin through the cycle. I feel really good about where we are, and I think we can.

因此，我們必須非常非常周到地考慮我們的投資方式、投資地點以及我們如何管理資源。我們將 - 再次，對於我們邊緣的問題，顯然，去年是非同尋常的。你的利潤率會下降，但我認為我們要好得多。正如我從一開始所說的那樣，我們可以在整個週期中維持高個位數，一種低兩位數的利潤率。我對我們所處的位置感覺非常好，我認為我們可以。

(Operator Instructions) Our next question comes from Ryan Gilbert with BTIG.

（操作員說明）我們的下一個問題來自 BTIG 的 Ryan Gilbert。

First question is on the residential purchase market. It looks like June orders were down maybe 11%, 12% year-over-year. So when we think about your comment around the current environment continuing through the second half of 2022 is a low double-digit decline sort of how you're framing this? Or is July tracking down more on a year-over-year basis than 11% or 12%?

第一個問題是關於住宅購買市場。看起來 6 月份的訂單同比下降了 11% 和 12%。因此，當我們考慮到您對持續到 2022 年下半年的當前環境的評論時，您是如何看待這個問題的？還是 7 月份的同比下降幅度超過 11% 或 12%？

Yes. I mean I think it's -- we're not -- in the month of July, Ryan, if you just sort of compare the sequential months, it's down a little bit June as we stand today, but it's not down at the double-digit level. I think we just have to see how the rest of the year plays out. We saw the rate increase yesterday. We still have pretty high mortgage spreads. They're well over 200 basis points, which is high relative to history.

是的。我的意思是我認為它是 - 我們不是 - 在 7 月份，Ryan，如果你只是比較連續幾個月，就像我們今天的情況一樣，它比 6 月份下降了一點，但它並沒有下降到兩倍——數字級別。我認為我們只需要看看今年剩下的時間會如何發展。昨天我們看到利率上漲。我們的抵押貸款利差仍然很高。它們遠遠超過 200 個基點，相對於歷史而言是很高的。

And so -- but on the other hand, you've got a lot of people just sitting on the sidelines waiting to see how things play out. So we didn't see the same level month-over-month, but I think there's a big question mark for the rest of the year. And as Fred said, we're managing the business assuming that there could be -- it could be a little worse.

所以——但另一方面，你有很多人只是坐在場邊等著看事情如何發展。所以我們沒有看到每個月的相同水平，但我認為今年剩下的時間有一個很大的問號。正如弗雷德所說，我們正在管理業務，假設可能存在 - 它可能會更糟。

Okay. Got it. And then how did fee-per-file trend through the quarter? It seems like home price depreciation has been more resilient than I would have expected, given the slowdown in housing demand and higher interest rates.

好的。知道了。那麼本季度的每文件費用趨勢如何？鑑於住房需求放緩和利率上升，房價貶值似乎比我預期的更具彈性。

Well, we read about -- on residential fee per file are, around $2,900. I think we've started to see that slowing down. I mean, it was up significantly from $2,200 a quarter ago. But with the predominantly purchase mix now. And I think we have seen some home price appreciation. But just reading headlines and seeing what's going on, prices are definitely stabilizing coming in a little bit and it depends on your market. So I would probably say we're near the top on that base on where HPI is and mix and purchase and refi.

好吧，我們讀到了——每份文件的住宿費約為 2,900 美元。我認為我們已經開始看到這種放緩。我的意思是，它比一個季度前的 2,200 美元有了顯著的增長。但現在主要是購買組合。我認為我們已經看到一些房價上漲。但只要閱讀頭條新聞並了解正在發生的事情，價格肯定會穩定下來，這取決於您的市場。因此，我可能會說我們在 HPI 的位置以及混合、購買和 refi 的基礎上接近頂部。

Okay. Got it. And then last one for me on agent mix. It's up on a year-over-year basis. I guess, just given some of the comments you made about deploying new initiatives to support the agency business, should we expect your agency revenue as a percent of operating revenue to continue to increase throughout the year? Or do you think mix kind of stabilizes from here?

好的。知道了。然後是我的最後一個代理組合。它是逐年上升的。我想，鑑於您對部署新舉措以支持代理業務的一些評論，我們是否應該期望您的代理收入佔營業收入的百分比全年繼續增加？或者你認為混合從這裡開始穩定？

Yes. That's a great question. We have seen some nice traction for us in agency. And it's really 2 big initiatives. We did a lot of integrations and connectivity agents through improving ease of use. And we have initiatives around some targeted state mix -- there's some real growth states we'd like to shift to, and we'd like to do a better job serving the commercial needs of agents. We've seen traction in both of those.

是的。這是一個很好的問題。我們在代理機構中看到了一些不錯的牽引力。這真的是兩大舉措。通過提高易用性，我們做了很多集成和連接代理。我們圍繞一些有針對性的州組合採取了舉措——我們希望轉向一些真正的增長狀態，我們希望更好地滿足代理商的商業需求。我們在這兩個方面都看到了牽引力。

So we're not immune to the trends in the marketplace. So -- but I like our traction in that way. And so I think in the short term, you could see a little shift towards agency. But remember, we're also quite focused on growing our direct business. So I don't think there's going to be a material change between us and both places over multiple quarters. But I think you're going to see some progress. And I'm seeing progress in agency, and I think we continue to see some more progress.

因此，我們不能不受市場趨勢的影響。所以 - 但我喜歡我們的牽引力。所以我認為在短期內，你可以看到向代理的一點轉變。但請記住，我們也非常專注於發展我們的直接業務。因此，我認為我們和兩個地方之間不會在多個季度內發生重大變化。但我認為你會看到一些進展。而且我看到代理方面的進展，我認為我們繼續看到更多進展。

It appears that we have no further questions at this time. I will now return the floor to the presenters for closing remarks.

看來我們目前沒有進一步的問題。我現在將發言權交還給演講者以作閉幕詞。

Well, I just want to thank everybody for joining us for our second quarter earnings call. Thank you so much.

好吧，我只想感謝大家加入我們的第二季度財報電話會議。太感謝了。

That concludes today's teleconference. Thank you for your participation. You may now disconnect.

今天的電話會議到此結束。感謝您的參與。您現在可以斷開連接。