Stewart Information Services Corp (STC) 2023 Q1 法說會逐字稿

Hello, and thank you for joining the Stewart Information Services First Quarter 2023 Earnings Call. (Operator Instructions) Please note today's call is being recorded. (Operator Instructions) It is now my pleasure to turn today's call over to Brian Glaze, Chief Accounting Officer. Please go ahead.

您好，感謝您加入 Stewart Information Services 2023 年第一季度財報電話會議。 （接線員說明）請注意今天的通話正在錄音中。 （操作員說明）現在我很高興將今天的電話轉給首席會計官 Brian Glaze。請繼續。

Thank you for joining us today for Stewart's First Quarter 2023 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.

感謝您今天加入我們參加斯圖爾特 2023 年第一季度收益電話會議。我們將討論昨天收盤後發布的結果。今天加入我的是首席執行官 Fred Eppinger；首席財務官 David Hisey。如需在線收聽，請訪問 stewart.com 網站以訪問本次電話會議的鏈接。

This conference call may contain forward-looking statements that involve a number of risks and uncertainties. Please refer to the company's press release and other filings with the SEC for a discussion of the risks and uncertainties that could cause our actual results to differ materially.

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。請參閱公司的新聞稿和其他提交給美國證券交易委員會的文件，以討論可能導致我們的實際結果出現重大差異的風險和不確定性。

During our call, we will discuss some non-GAAP measures. For a reconciliation of these non-GAAP measures, please refer to the appendix in today's earnings release, which is available on our website at stewart.com. Let me now turn the call over to Fred.

在我們的通話中，我們將討論一些非 GAAP 措施。有關這些非 GAAP 措施的對賬，請參閱今天的收益發布中的附錄，該附錄可在我們的網站 stewart.com 上獲取。現在讓我把電話轉給弗雷德。

Thank you for joining us today for Stewart's First Quarter 2023 Earnings Conference Call. David will review the quarterly financial results in a minute, but before that, I would like to cover our overall view of Stewart and the current market. Our efforts at Stewart over the last 3 years have focused on fundamentally improving the company's operating performance to better position ourselves on our journey to becoming the premier title services company.

感謝您今天加入我們參加斯圖爾特 2023 年第一季度收益電話會議。大衛將在一分鐘內回顧季度財務結果，但在此之前，我想介紹一下我們對斯圖爾特和當前市場的整體看法。過去 3 年，我們在 Stewart 所做的努力主要集中在從根本上改善公司的經營業績，以便更好地定位我們成為一流產權服務公司的旅程。

The long-term goal remains to create a strong business that can thrive through all real estate cycles and economic conditions. We will focus on improving margins, growth and resiliency by improving our scale in attractive markets and enhancing our operational capabilities. In challenging markets like we are currently in, it is often difficult to advance long-term goals. However, I am pleased with our progress towards improving our long-term performance as we balance investments with the need to manage expenses carefully.

長期目標仍然是創建一個能夠在所有房地產週期和經濟條件下蓬勃發展的強大業務。我們將通過擴大我們在有吸引力的市場的規模和增強我們的運營能力，專注於提高利潤率、增長和彈性。在我們目前所處的充滿挑戰的市場中，通常很難實現長期目標。然而，我對我們在改善長期業績方面取得的進展感到高興，因為我們平衡了投資與謹慎管理費用的需要。

As we discussed before, we anticipated the first quarter to be our most challenging. To prepare for this, we took significant actions to manage costs during the second half of '22 and again in the first quarter of '23. We have been careful not to take actions that we felt would threaten our competitive position and long-term value-creating opportunities. We believe this is a historic cycle lull. And the right answer to get us through this period is to continue to invest in our people and remain focused on our long-term improvement plan and manage through a couple of challenging quarters, which is what we are doing.

正如我們之前討論的那樣，我們預計第一季度將是最具挑戰性的。為此，我們在 22 年下半年和 23 年第一季度採取了重大行動來管理成本。我們一直小心謹慎，不採取我們認為會威脅到我們的競爭地位和長期價值創造機會的行動。我們認為這是一個歷史性的周期平靜期。讓我們度過這段時期的正確答案是繼續投資於我們的員工並繼續專注於我們的長期改進計劃並管理好幾個具有挑戰性的季度，這就是我們正在做的事情。

Earlier in the first quarter, interest rates ticked down very significantly, which resulted in an increase in open orders. However, order volumes slowed again and rates quickly reversed again in February, peaking in mid-March. These challenging market dynamics, along with the impact of seasonality led us to our lowest quarter closed order lines in over 20 years and resulted in an overall loss for the quarter.

第一季度早些時候，利率大幅下降，導致未結訂單增加。然而，訂單量再次放緩，費率在 2 月份再次迅速逆轉，並在 3 月中旬達到頂峰。這些具有挑戰性的市場動態，以及季節性的影響，導致我們的季度關閉訂單量達到 20 多年來最低，並導致本季度整體虧損。

As we moved into the second quarter, interest rates moderated slightly but remained elevated. We expect this difficult environment will moderately improve in the second quarter, but the challenging environment will continue into the second half of '23. And we will continue to manage our business with a careful balance of cost discipline and investments in skills and capabilities that we expect will best position us for the long term.

隨著我們進入第二季度，利率略有放緩但仍處於高位。我們預計這種困難的環境將在第二季度適度改善，但充滿挑戰的環境將持續到 23 年下半年。我們將繼續管理我們的業務，謹慎平衡成本紀律和對技能和能力的投資，我們預計這將使我們長期保持最佳地位。

Although interest rates have declined in the early second quarter, interest rates, home inventory and housing affordability will be (inaudible) to any quick return to a normal real estate market. We remain focused on our long-term strategies, enhancing our operating model, investments in technology and customer experience and improved efficiency of our operations and building scale in targeted areas. While we took additional expense actions this quarter, we recognize that these strategic investments will cause our cost ratios to remain elevated in this market. We believe that the long-term investments, coupled with a thoughtful near-term expense management will improve our structure and financial performance in the long term.

儘管利率在第二季度初有所下降，但利率、房屋庫存和住房負擔能力將（聽不清）任何快速恢復正常的房地產市場。我們仍然專注於我們的長期戰略，改進我們的運營模式，投資於技術和客戶體驗，提高我們的運營效率，並在目標領域擴大規模。雖然我們在本季度採取了額外的費用措施，但我們認識到這些戰略投資將導致我們在這個市場上的成本比率保持高位。我們相信，長期投資加上深思熟慮的近期費用管理將改善我們的結構和長期財務業績。

In our direct operations, we are making progress on our strategy both scale and attractive markets. Even during this challenging market, we have continued to evaluate a select number of opportunities to increase our scale and footprint. Given the market uncertainty, we will make very thoughtful decisions around deployment of capital. Positioning our commercial operations for growth across all our business lines has been a key focus in our journey as these operations are an important component of our overall strategy.

在我們的直接運營中，我們在規模和有吸引力的市場戰略方面取得了進展。即使在這個充滿挑戰的市場中，我們仍在繼續評估一些精選的機會，以擴大我們的規模和足跡。鑑於市場的不確定性，我們將圍繞資本部署做出非常周到的決定。將我們的商業運營定位於我們所有業務線的增長一直是我們旅程的重點，因為這些業務是我們整體戰略的重要組成部分。

We made investments in talent during the past year to aid in achieving these objectives, and we believe our focus will create long-term growth in the commercial markets, although we recognize changing financial markets may create headwinds in the short term. In our agency business, we have made excellent progress on our deployment of technology and services that provide greater connectivity, ease of use and risk reduction for our agent partners. As we move through '23, our platform of services for agents is as strong as it's ever been, and we have begun to see meaningful share growth in our target markets.

我們在過去一年對人才進行了投資以幫助實現這些目標，我們相信我們的重點將在商業市場創造長期增長，儘管我們認識到不斷變化的金融市場可能會在短期內造成不利因素。在我們的代理業務中，我們在技術和服務部署方面取得了長足進步，這些技術和服務為我們的代理合作夥伴提供了更好的連接性、易用性和風險降低。隨著 23 年的到來，我們的代理商服務平台一如既往地強大，我們已經開始在目標市場中看到有意義的份額增長。

On the topic of technology, we continue to invest significantly in improving our technology for the title production, process automation and centralization to improve operational efficiencies and capabilities. We've already made significant progress improving customer experience across all channels and rolling out our agency technology platform, which significantly enhances ease of use of connectivity with agents.

在技術方面，我們繼續大力投資改進我們的技術，以改善標題製作、流程自動化和集中化，以提高運營效率和能力。我們已經在改善所有渠道的客戶體驗和推出我們的代理技術平台方面取得了重大進展，這顯著提高了與代理連接的易用性。

Additionally, we have made significant integrated, completed acquisitions into our production of other systems, which improves our customer experience as well as the overall operating efficiencies that we've been building on for the past several years. The remaining integrations will be an important focus for the remainder of '23. Maintaining our current strong financial position while investing opportunistically during this market remains a top priority.

此外，我們已經對其他系統的生產進行了重大的集成、完整的收購，這改善了我們的客戶體驗以及我們在過去幾年中一直建立的整體運營效率。其餘的集成將成為 23 年剩餘時間的重點。保持我們目前強勁的財務狀況，同時在這個市場中進行機會主義投資仍然是重中之重。

Financially, our long-term goals remain to generate high single, low double-digit margins over the cycle. However, there will be quarters like the first quarter and the fourth quarter '22 where margins will be challenged. We remain focused on our strategic plan of building an improved competitive position and being more efficient in having a disciplined operating model that functions well through all real estate cycles.

在財務上，我們的長期目標仍然是在整個週期內產生高個位數、低兩位數的利潤率。然而，像第一季度和第四季度 22 年這樣的季度，利潤率將受到挑戰。我們仍然專注於我們的戰略計劃，即建立一個更好的競爭地位，並更有效地擁有一個在所有房地產週期中運作良好的紀律嚴明的運營模式。

We have emphasized growing scale in attractive markets across our business, and we have made significant progress in improving the customer experience in all channels. While we are encouraged by our improvements in all our 4 critical fronts: talent, technology, customer experience and our financial model, we recognize work remains and our journey is not complete. However, we have seen the results of our efforts to increase year-over-year market share gains in each of our direct agency and commercial businesses.

我們強調在我們的業務中有吸引力的市場中不斷擴大規模，並且我們在改善所有渠道的客戶體驗方面取得了重大進展。雖然我們對所有 4 個關鍵領域（人才、技術、客戶體驗和我們的財務模型）的改進感到鼓舞，但我們認識到工作仍然存在，我們的旅程還沒有完成。然而，我們已經看到了我們在每個直接代理和商業業務中增加同比市場份額增長的努力的結果。

Let me finish by reiterating that we will both manage our expenses and investments with a practical balance between an operating discipline to the current short-term market challenges and strengthening story for the long-term growth performance. The strong financial footing should best position us to take advantage of the opportunities that this cycle will provide. I'd also like to restate my long-term view on the real estate market and the ability to become the premier title services company. A tremendous thank you to our associates in all their hard work and to our customers for their continued loyalty and support. David will now update everyone on our results.

最後，我要重申，我們將通過在應對當前短期市場挑戰的經營紀律與加強長期增長業績的故事之間取得實際平衡來管理我們的費用和投資。強大的財務基礎應該使我們能夠最好地利用這個週期將提供的機會。我還想重申我對房地產市場的長期看法以及成為首屈一指的產權服務公司的能力。非常感謝我們的同事們的辛勤工作，也感謝我們的客戶一直以來的忠誠和支持。大衛現在將向大家更新我們的結果。

Good morning, everyone, and thank you, Fred. First, I would also like to thank our associates for their amazing service and our customers for their support. As Fred noted, the first quarter saw a continuation of a difficult real estate market and poor consumer segment. Low residential inventory, high mortgage rates, lower commercial real estate activity and tough economic conditions all contributed to this situation.

大家早上好，謝謝你，弗雷德。首先，我還要感謝我們的員工提供的優質服務以及我們客戶的支持。正如 Fred 指出的那樣，第一季度房地產市場持續低迷，消費者群體不景氣。住宅庫存低、抵押貸款利率高、商業房地產活動低迷和經濟形勢嚴峻都是造成這種情況的原因。

Yesterday, Stewart reported a net loss of $8 million or $0.30 per diluted share on total revenues of $524 million. After adjusting for net realized and unrealized gains and losses, the adjusted first quarter, that loss was $7 million or $0.25 per diluted share compared to a net income of $56 million in the first quarter of 2022. The low results for the first quarter were primarily driven by significantly lower revenues caused by volume to classify lower home sales and refinances.

昨天，斯圖爾特報告淨虧損 800 萬美元或每股攤薄收益 0.30 美元，總收入為 5.24 億美元。在對已實現和未實現的淨損益進行調整後，調整後的第一季度虧損為 700 萬美元或每股攤薄收益 0.25 美元，而 2022 年第一季度的淨收入為 5600 萬美元。第一季度的低業績主要是受銷量顯著下降的推動，將較低的房屋銷售和再融資分類。

Total title revenues in the first quarter decreased $265 million or 37%, resulting in the Title segment's pretax loss of approximately $1 million from pretax income of $83 million during the prior year quarter. After adjustments for purchase intangible amortization and other items listed in Appendix A of our press release, the segment's pretax income was $4 million or 1% margin compared to $81 million or 11% margin in 2022.

第一季度的產權總收入減少了 2.65 億美元或 37%，導致產權部門的稅前虧損從去年同期的 8300 萬美元稅前收入減少了約 100 萬美元。在對我們新聞稿附錄 A 中列出的採購無形攤銷和其他項目進行調整後，該部門的稅前收入為 400 萬美元或 1% 的利潤率，而 2022 年為 8100 萬美元或 11% 的利潤率。

In our direct title business, domestic commercial revenues decreased $24 million or 42%, primarily due to lower transaction volume and size. Average commercial fee per file was approximately $8,300 for the first quarter compared to $12,700 for the prior year quarter. Domestic residential revenues were down $70 million or 32% as a result of significantly lower purchase and refinancing transactions. However, residential fee per file was approximately $3,400, which was 30% higher from last year due to a higher purchase mix.

在我們的直接所有權業務中，國內商業收入減少了 2400 萬美元或 42%，這主要是由於交易量和規模下降。第一季度每份文件的平均商業費用約為 8,300 美元，而去年同期為 12,700 美元。由於購買和再融資交易大幅減少，國內住宅收入下降了 7000 萬美元或 32%。但是，由於更高的購買組合，每份文件的住宿費約為 3,400 美元，比去年高出 30%。

Total international revenues decreased $16 million or 40%, primarily due to lower transaction volumes in our Canadian operations. Total open and closed orders declined by 37% and 45%, respectively, in the first quarter compared to last year. In line with our direct title revenues, first quarter revenues from our agency operations decreased $155 million or 38% compared to last year. The average agency rate decreased to 17.4% compared to 18.1%, primarily as a result of geographic mix.

國際總收入減少 1600 萬美元或 40%，主要是由於我們加拿大業務的交易量減少。與去年同期相比，第一季度未結訂單和已結訂單總額分別下降了 37% 和 45%。與我們的直接產權收入一致，第一季度我們代理業務的收入與去年相比減少了 1.55 億美元或 38%。平均代理率從 18.1% 下降到 17.4%，這主要是由於地域組合。

In regard to title losses, total title loss expense in the first quarter decreased $12 million or 40%, primarily driven by lower title revenues. As a percentage of total revenues, the title loss expense was 3.9% compared to 4% last year. For the full year 2023, we expect title losses to average from 4% to 4.2% of title revenues.

在產權損失方面，第一季度總產權損失費用減少了 1200 萬美元或 40%，這主要是由於產權收入下降所致。產權損失費用佔總收入的百分比為 3.9%，而去年為 4%。對於 2023 年全年，我們預計產權損失平均佔產權收入的 4% 至 4.2%。

For the real estate solutions segment, pretax income decreased to $1.4 million for the first quarter from $7 million last year, primarily as a result of 30% lower revenues driven by lower transaction volume. First quarter pretax margin was 2.2% compared to 7.6% last year after adjusting for purchase intangible amortization for the adjusted pretax margin was 11.5% compared to 14.8% last year. The segment's total operating expenses in the quarter decreased 26%, primarily due to lower costs related to revenues and lower incentive compensation.

對於房地產解決方案部門，第一季度稅前收入從去年的 700 萬美元下降至 140 萬美元，這主要是由於交易量下降導致收入下降 30%。第一季度稅前利潤率為 2.2%，去年同期為 7.6%，經調整後的無形資產攤銷調整後稅前利潤率為 11.5%，去年同期為 14.8%。該部門本季度的總運營費用下降了 26%，這主要是由於與收入相關的成本下降和激勵薪酬下降。

Consolidated employee costs as a percentage of operating revenues increased to 33% compared to 24% in last year's quarter, primarily due to lower operating revenues in '23. Other operating expenses as a percent of operating revenues were 23%, which was comparable to last year.

綜合員工成本佔營業收入的百分比從去年同期的 24% 增加到 33%，這主要是由於 23 年營業收入下降。其他營業費用佔營業收入的比例為23%，與去年持平。

On other matters, our financial position remains strong to support our customers and employees in the real estate market. At March 31, 2023, our total cash and investments were approximately $340 million over statutory premium requirements, and we also have a fully available $200 million line of credit facility. Total stockholders' equity attributable to Stewart at the end of the quarter was approximately $1.35 billion, and our book value per share was approximately $50.

在其他方面，我們的財務狀況依然強勁，可以為房地產市場的客戶和員工提供支持。截至 2023 年 3 月 31 日，我們的現金和投資總額比法定保費要求高出約 3.4 億美元，我們還擁有完全可用的 2 億美元信貸額度。本季度末歸屬於 Stewart 的股東權益總額約為 13.5 億美元，每股賬面價值約為 50 美元。

Lastly, cash used in operations of $51 million compared with net cash provided by operations of $35 million last year, primarily driven by the first quarter's net loss. We are always grateful for our customers and associates. We advocate for safety and prosperity, remain confident in our support in real estate markets. I'll now turn the call back over to the operator for questions.

最後，運營中使用的現金為 5100 萬美元，而去年運營提供的現金淨額為 3500 萬美元，這主要是受到第一季度淨虧損的推動。我們始終感謝我們的客戶和同事。我們提倡安全和繁榮，對我們對房地產市場的支持充滿信心。我現在將電話轉回接線員詢問問題。

(Operator Instructions)

（操作員說明）

We will take our first question from Bose George with KBW.

我們將與 KBW 一起接受 Bose George 的第一個問題。

Actually, I wanted to ask about the margin, and it might be a tough question. But just given the tough -- the challenging backdrop on both residential and commercial and assuming that persists for much of this year, what can we think about in terms of the margins the business can generate?

實際上，我想問的是保證金，這可能是一個棘手的問題。但考慮到住宅和商業的艱難 - 具有挑戰性的背景，並假設今年大部分時間都持續存在，我們可以考慮業務可以產生的利潤率？

Yes. Bose, I'm still convinced that as we look out for the next 6 to 8 quarters, we will end up averaging kind of that high single digit, double digit. I did think the question is kind of how it evolves this year. And I think we all have a view that is going to improve material into the second half of the year.

是的。 Bose，我仍然相信，在我們展望接下來的 6 到 8 個季度時，我們最終將平均達到那種高個位數，兩位數。我確實認為問題是它今年如何演變。而且我認為我們都認為將在下半年改進材料。

I think if you think about it now, I would say over the last 6 weeks, I think it's going to be a more moderate improvement in the second quarter but it will improve. What's interesting for us is that closed orders were down 50% in January; 28%, I think, in February and then 40% in March, (inaudible) in March. And so I think we're much better confident I think we can manage ourselves. And I think the margins will improve dramatically through the year. I just think there'll be more moderate improvement in the second quarter than maybe we saw 6 weeks ago because of the volumes.

我想如果你現在考慮一下，我會說在過去的 6 周里，我認為第二季度會有更溫和的改善，但它會改善。對我們來說有趣的是，1 月份關閉的訂單下降了 50%； 28%，我認為是在 2 月份，然後是 40% 在 3 月份，（聽不清）3 月份。所以我認為我們更有信心我認為我們可以管理自己。我認為全年利潤率將大幅提高。我只是認為，由於銷量的原因，第二季度的改善可能比我們 6 週前看到的要溫和。

But again, if you look at last year where we had a tough fourth quarter, we ended at the 8%, I think we'll be a little less than that this year if the back half improves. But I think it's going to -- we have a lot of leverage here. But one of the things is we have capacity in the system. And so as the volume comes in, we won't be adding a lot of resource, right? So we have a lot of leverage on where we are and the portfolio is a lot better. And because I look at a historic rate, that our order count is kind of where we are, I think we're both some of the bottom now, and we're poised to do updates through the rest of the year.

但同樣，如果你看看去年我們第四季度表現不佳，我們以 8% 結束，如果後半部分有所改善，我認為今年我們會比這個少一點。但我認為它會 - 我們在這裡有很多影響力。但其中一件事是我們在系統中有能力。因此，隨著數量的增加，我們不會添加很多資源，對嗎？因此，我們對我們所處的位置有很大的影響力，而且投資組合要好得多。而且因為我看的是歷史增長率，我們的訂單數量有點像我們現在所處的位置，我認為我們現在都處於底部，我們準備在今年餘下的時間裡進行更新。

Okay. That's great. That's very helpful. And then just on the real estate solutions segment, what's a good way to think about the run rate there? Like how much of that is transaction dependent versus not?

好的。那太棒了。這很有幫助。然後就房地產解決方案部分而言，考慮那裡的運行率的好方法是什麼？比如其中有多少依賴於交易而不是交易？

Yes. This is Dave. It's pretty transaction-dependent. If you think about the mix of businesses, we've got the PropStream business, which is a subscription business so that's not as transaction-dependent on when people come in and out of that business depending on what's happening in the market. So that's less transaction-dependent. But the other businesses, appraisal, credit, those are transaction-dependent. And so that was what you really saw in this quarter in some of those businesses. Transactions hit pretty hard.

是的。這是戴夫。它非常依賴於事務。如果你考慮業務組合，我們有 PropStream 業務，這是一項訂閱業務，因此它不像交易那樣依賴於人們何時進出該業務，具體取決於市場上發生的事情。所以這對交易的依賴性較小。但是其他業務，評估，信用，這些都是交易相關的。所以這就是你在本季度在其中一些企業中真正看到的。交易受到了相當大的打擊。

We have had some pretty good success in the credit business differentially in the market. And I think in general, that business is doing well relative to the market. We're participating in the appraisal program, one of the tenders that were selected for that. So those are the kinds of things that will really help that business sort of be durable and better than some as the market improves. That's the way to maybe think about the puts and takes. So I'd say a good amount, over half is transaction-dependent, and then you've got some stuff that's less transaction-dependent.

我們在市場上差異化的信貸業務上取得了一些相當不錯的成功。我認為總的來說，相對於市場，該業務表現良好。我們正在參與評估計劃，這是為此選擇的投標之一。因此，隨著市場的改善，這些事情將真正幫助該業務持久並優於某些業務。這就是考慮看跌期權的方式。所以我會說很多，超過一半是依賴於交易的，然後你有一些不太依賴於交易的東西。

Okay, that's helpful. And then just the increase in that segment over last quarter, was that just sort of some of the acquisitions kicking in?

好的，這很有幫助。然後只是上個季度該細分市場的增長，這只是一些收購的開始嗎？

Well, we did have the small account check acquisition in the first quarter. We had a nominal benefit from that. But we did also have some customer wins, and so I think it was a combination of those.

好吧，我們在第一季度確實獲得了小額支票。我們從中獲得了名義上的好處。但我們確實也贏得了一些客戶，所以我認為這是這些的結合。

Yes. We had -- we have some good momentum in a couple of those businesses around products that actually help lenders save money in the mortgage process. And so we're actually getting a little bit of growth happening in a couple of those businesses right now.

是的。我們有——我們在其中一些業務中有一些良好的勢頭，圍繞著實際上幫助貸方在抵押貸款過程中省錢的產品。因此，我們現在實際上在其中一些業務中取得了一些增長。

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

我們將接受 Stephens Inc. 的 John Campbell 的下一個問題。

Going back to the question, and this is for Fred or maybe David here, but can you talk to the levers to control in the model or you don't think you need to add much additional expense as the revenue rebuilds? Just trying to get a better grip on those incrementals. It would be helpful if you guys maybe provide the all-in fixed cost level as it stands right now, or if you're not able to provide that, maybe just talk broadly to the mix of fixed first variable costs now and maybe how you expect that to shift from here.

回到這個問題，這是給 Fred 或 David 的，但是你能談談模型中的槓桿控制嗎，或者你認為你不需要在收入重建時增加太多額外費用？只是想更好地掌握這些增量。如果你們可以提供目前的全部固定成本水平，或者如果您無法提供，也許只是廣泛地談談現在固定的第一可變成本的組合以及您如何期望從這裡轉變。

Well, obviously, we have the strict fixed costs, right, during the 20% or 30% thing.

好吧，很明顯，我們有嚴格的固定成本，對，在 20% 或 30% 的事情期間。

Yes, sort of 20% to 30% fixed, then you've got sort of the 40% to 50% 70% variable and then the 30% or 40% of true variable. And the challenge is always managing the variable.

是的，20% 到 30% 是固定的，然後你有 40% 到 50% 70% 的變量，然後是 30% 或 40% 的真實變量。挑戰始終是管理變量。

Exactly. So what I would say, John, is the personnel lines, like if you're 50% point, you can't cut 50% of your resource, personnel, right? And so you're going to be really careful about how you're managing the resource and protect the capabilities of the institution. So what I would say is that we've been very thoughtful and we've done a lot of actions.

確切地。所以我要說的是，約翰，是人事線，如果你是 50%，你就不能削減 50% 的資源，人事，對嗎？所以你要非常小心你如何管理資源和保護機構的能力。所以我要說的是，我們考慮周全，也採取了很多行動。

But the way I think about it is we have excess capacity in that semi-variable component that we've retained to take advantage of the market as it comes back. And so therefore, what you see is in notorious in this business, right? And the way up, your margin is higher, right, because you're managing kind of that semi-variable, to Dave's point, in a fixed way and that will increase.

但我的想法是，我們保留了半可變組件的過剩產能，以便在市場回歸時利用它。因此，您所看到的在這個行業中是臭名昭著的，對吧？往上走，你的利潤率更高，對吧，因為你正在以一種固定的方式管理那種半變量，對戴夫的觀點來說，這會增加。

And then at some point, you hit in over time, if we hit in '21 if you don't have resources, it really gets exaggerated as far as your margin. So again, the way I look at it is that we're bouncing off the bottom here, we've done a very good job. I really applaud our team on being across the board, and we've thought about expenses in every dimension.

然後在某個時候，隨著時間的推移，如果我們在沒有資源的情況下進入 21 年，那麼你的利潤率真的會被誇大。所以，我的看法是，我們正在從底部反彈，我們做得非常好。我真的很讚賞我們的團隊的全面性，我們已經考慮了各個方面的費用。

And as I look forward, that incremental revenue helps us tremendously on margin. I just think it's going to be a tad slower than we thought before. I think the second quarter, what you're seeing is, well, 10 years down, that spread wide and the inventory is not a little bit hesitant to go up, although I saw that yesterday was a tad better about total level. But it's kind of a freeze over time. I'm still pretty encouraged by the end of the year, especially next quarter is a transition period.

正如我所期待的那樣，增加的收入極大地幫助了我們的利潤率。我只是認為它會比我們之前想像的要慢一點。我認為第二季度，你所看到的是，嗯，下降了 10 年，範圍廣泛，庫存沒有一點猶豫要上升，儘管我看到昨天的總水平略好一些。但隨著時間的推移，它有點凍結。到年底我還是很受鼓舞的，尤其是下個季度是一個過渡期。

And again, I'll reiterate what I said, we would have 30% in order count in March, and we made some, right? This company historically we haven't been able to do at this company. For 100 years, we've never been running in the first quarter. So we have been fortunate enough to do that the last 3 years and you look at our portfolio and how we manage ourselves, and I think we have a lot of leverage on the way up here. We just got to keep managing ourselves, right? So it's a challenged market.

再一次，我要重申我說過的話，我們 3 月份的訂單數量將達到 30%，我們做了一些，對嗎？歷史上我們無法在這家公司做這家公司。 100 年來，我們從未在第一季度運行過。所以我們很幸運在過去的三年裡做到了這一點，你看看我們的投資組合以及我們如何管理自己，我認為我們在上升的過程中有很大的影響力。我們只需要繼續管理自己，對吧？所以這是一個充滿挑戰的市場。

Makes sense. That's really good color. I appreciate that. And then on commercial, obviously, a lot of uncertainty out there. I think investor attention is really shifting towards commercial obviously. If you guys can maybe talk to the order pipeline, what you guys are seeing? I saw March, the open orders are down 40%. Kind of what you're seeing if you've got any insight into April? And then if you could just talk broadly to the mix and the fee for file, maybe what you're expecting around fee per file, there's going to be continued pressure there as you close out in 2Q.

說得通。這顏色真好我很感激。然後在商業上，顯然存在很多不確定性。我認為投資者的注意力正在明顯地轉向商業。如果你們可以談談訂單管道，你們看到了什麼？我看到 3 月份，未結訂單下降了 40%。如果您對 April 有任何了解，您會看到什麼？然後，如果您可以廣泛地談論文件的組合和費用，也許您對每個文件的費用的期望是什麼，那麼當您在第二季度結束時，那裡將會繼續承受壓力。

Go ahead, Dave.

來吧，戴夫。

Yes, John. I mean, it's -- I think what you're seeing is in our book is not inconsistent with what you're seeing in the market generally. You've got offices obviously challenged, although some market's not as challenged as others. I think the major natural offices tend -- the major metrics tend to be a little more challenged primarily because they have some more work from home.

是的，約翰。我的意思是，我認為你在我們的書中看到的與你在市場上普遍看到的並不矛盾。你的辦公室顯然受到了挑戰，儘管有些市場的挑戰沒有其他市場那麼大。我認為主要的自然辦公室傾向於 - 主要指標往往更具挑戰性，主要是因為他們有更多的在家工作。

And so we haven't seen like in New York in places like that, the bigger transactions come back, and you're seeing that in the longer fee for file. I think as you get into some of the smaller markets, it's not as bad of a story on office, although there, you have to see what's going to happen with all the regional banks because they've been a big credit provider to that sector.

因此，我們在紐約這樣的地方還沒有看到，更大的交易又回來了，而且你在更長的文件費用中看到了這一點。我認為當你進入一些較小的市場時，辦公室的故事並沒有那麼糟糕，儘管在那裡，你必須看看所有區域性銀行會發生什麼，因為它們一直是該行業的大型信貸提供者.

We saw a lot of energy deals at the end of the year. I think there's still a lot of activity there and we'll probably see some of those mature and close here over the coming year. And then it's sort of a mixed bag. I mean, you're seeing decent stuff in retail. Multifamily have been really strong. It's slipping a little bit but generally stronger than the rest. And industrial's backed off a little bit, right, because there just isn't as much activity as we saw during the pandemic but still generally strong.

我們在年底看到了很多能源交易。我認為那裡仍然有很多活動，我們可能會在來年看到其中一些成熟並關閉。然後它有點複雜。我的意思是，你在零售業看到了不錯的東西。多戶家庭真的很強大。它有點下滑，但總體上比其他的強。工業有所回落，對吧，因為活動沒有我們在大流行期間看到的那麼多，但總體上仍然很強勁。

So I think it's the combination of those things and then what's happening in the capital markets and then people trying to adjust the cap rate change in the lifetime valuation that's causing that slowing. But one, if there is a slightly positive thing, deals are mainly getting pushed, not careful. And so we just have to see how that all develops. And so hopefully, as there's more clarity on valuation in capital and financing, those will actually close, right? And that or maybe there's a better outcome. But should that situation not change, that will continue to be challenged.

所以我認為這是這些事情的結合，然後是資本市場正在發生的事情，然後是人們試圖調整導致這種放緩的終身估值的資本化率變化。但是，第一，如果有一點積極的事情，交易主要是被推動，不小心。所以我們只需要看看這一切是如何發展的。所以希望，隨著資本和融資估值的更加清晰，這些實際上會關閉，對吧？那或者也許會有更好的結果。但如果這種情況不改變，它將繼續受到挑戰。

Yes. So I think we're -- I don't think it's like the res market. I think it's -- again, we're planning on it being down a little bit. We were fortunate enough to gain share last year in commercial. We've done -- we've had some good progress. Our energy practice is as busy as it's ever been. It's a little bit choppy, is lumping because of when the closings are.

是的。所以我認為我們 - 我不認為它像資源市場。我認為它 - 再一次，我們計劃將其降低一點。我們很幸運去年在商業領域獲得了份額。我們已經完成了——我們取得了一些不錯的進展。我們的能量練習一如既往地忙碌。它有點起伏不定，因為關閉的時間而結塊。

So one of the interesting things we have is we have probably a higher portfolio in our centralized commercial smaller deals. And I think the uncertainty around the regional banks is a little bit of a pause in some of that market. And so there is a little bit, I think, kicking out of some of that. So we kind of think we're going to have -- this downturn is going to be real for a while, and we'll see, I think, the back half of the year some better results.

因此，我們擁有的一件有趣的事情是，在我們集中的商業小交易中，我們可能擁有更高的投資組合。而且我認為圍繞區域性銀行的不確定性在某些市場上有點暫停。因此，我認為，其中有一點被排除在外。所以我們有點認為我們將會有 - 這種低迷將持續一段時間，我認為我們會在今年下半年看到一些更好的結果。

But it's interesting to us. We are really busy in a couple of these segments as good as we've ever been. And so it's interesting. I feel pretty good about the business by the end of the year and towards the end of the year. But it is kind of a very uncertain all the stuff for the bank this week it makes all that stuff a little bit uncertain.

但這對我們來說很有趣。我們真的很忙於其中的幾個部分，就像我們以往一樣。所以這很有趣。到年底和臨近年底，我對這項業務感覺非常好。但本周銀行的所有事情都非常不確定，這讓所有事情都變得有點不確定。

But you also, John, have to think about it in the dimensions. It's not only sector-specific but it's type of activity. So new developments, sales and then refinances, right? And you do have that $1.5 trillion maturity ladder mainly this year and next year. That's going to provide some support to commercial.

但是，約翰，你也必須從維度上考慮它。它不僅是特定於部門的，而且是活動的類型。那麼新的開發、銷售和再融資，對嗎？而且你確實主要在今年和明年擁有 1.5 萬億美元的到期階梯。這將為商業提供一些支持。

And then it's just a question of what happens with that, right? You have a lot of restructure. You have some defaults. As it looks like now with all the REITs and everybody reporting, even though people might be increasing reserves, a lot of those loans are still for (inaudible), right which could be positive because it might mean you could actually refinance those and have to restructure the default.

然後這只是一個問題，對吧？你有很多重組。你有一些默認值。現在看來，所有房地產投資信託基金和每個人都在報告，即使人們可能會增加準備金，但其中很多貸款仍在（聽不清），這可能是積極的，因為這可能意味著您實際上可以為這些貸款再融資，並且必須重構默認值。

Yes, that's helpful. That's great insight. I appreciate that guys. Last one for me, just a housekeeping question. But David, on the other orders, I know M&A is sort of influencing that but you've had a pretty big step-up there. If you could maybe talk to the seasonality of those other orders as well as what that kind of average fee per file is.

是的，這很有幫助。這是偉大的洞察力。我很感激你們。最後一個對我來說，只是一個內務問題。但是大衛，在其他訂單上，我知道併購有點影響，但你在那裡有很大的進步。如果您可以談談其他訂單的季節性以及每個文件的平均費用是多少。

Others primarily are reversed basis through FMC. And yes, I mean, that's going to approximate more, not exactly because the transactions are a little bit smaller but it's going to be closer to a purchase transaction and a refinance transaction.

其他主要是通過 FMC 的反向基礎。是的，我的意思是，這將接近更多，不完全是因為交易有點小，但它會更接近購買交易和再融資交易。

Okay. And then -- and that's from a fee per file standpoint and seasonality standpoint?

好的。然後——這是從每個文件的角度和季節性的角度收費嗎？

Well, it's not as seasonal, right, because it's -- you can do that -- if you have equity, it's more a function of getting a hold of a customer and closing the well. So it's not as seasonal. It's in markets like this where you have a lot of built-in equity is actually a good market. It's just that market has been changing a lot with some of the originators being sold, repositioned, that kind of thing. You've also got new originators coming in. So I think it's more a function on the volume side of what's happening with the originators than it is the opportunity from an equity and an age perspective.

好吧，它不是季節性的，對吧，因為它——你可以做到——如果你有股權，它更像是抓住客戶和關閉油井的功能。所以它不是季節性的。在這樣的市場中，您擁有大量內置資產實際上是一個很好的市場。只是隨著一些原創者被出售、重新定位之類的事情，市場發生了很大變化。你也有新的發起人進來。所以我認為這更多的是發起人正在發生的事情的數量方面的功能，而不是從公平和年齡的角度來看的機會。

(Operator Instructions)

（操作員說明）

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

我們將接受 Dowling & Partners 的 Geoffrey Dunn 的下一個問題。

So I'm not sure if I'm going to ask this right but from a commercial market, obviously, we're going through a big downturn cycle here. But with what's going on with office space, do you have concerns that there's any kind of secular shift happening? And I ask that more because of you mentioned about investing in commercial talent. Is your commercial talent, for example, focused on certain sectors, and you could have made an investment in some of your specialized in office, and now that's not necessarily the right investment? Is that something we have to worry about if office doesn't come back? Or is your talent -- commercial talent more flexible across the various sectors that you cite?

所以我不確定我是否會問這個問題，但從商業市場來看，顯然，我們正在經歷一個大的低迷週期。但是隨著辦公空間的發展，您是否擔心會發生任何類型的長期轉變？我問的更多是因為你提到了投資商業人才。例如，您的商業人才是否專注於某些領域，您本可以對辦公室的一些專業進行投資，但現在這不一定是正確的投資？如果 office 不回來，那是我們必須擔心的事情嗎？還是您的才能——商業人才在您提到的各個領域都更加靈活？

It's a good question because it is actually more flexible. For us, it's very geographical. So one of the things that this company was historically is we were very skewed to New York on the commercial side and we didn't have the breadth geographically. And so it actually is diversified away from office in some ways or office life developments. And so I feel really good about it.

這是一個很好的問題，因為它實際上更靈活。對我們來說，這是非常地理性的。所以這家公司歷史上的一件事是我們在商業方面非常偏向紐約，而且我們在地理上沒有廣度。因此，它實際上在某些方面或辦公室生活的發展中遠離辦公室。所以我對此感覺非常好。

In fact, we did some energy-focused acquisition because it's kind of one of our underwriting capabilities. It's obviously because of what's happening, there's some opportunity there. But it's been very much geographic. And obviously, there's some obvious places, whether it's industrial or the warehouse or the data center stuff, there are some natural places that we focused on, given what the trends were. And so I feel pretty good about what we've done.

事實上，我們進行了一些以能源為重點的收購，因為這是我們的承銷能力之一。這顯然是因為正在發生的事情，那裡有一些機會。但這在很大程度上是地理性的。顯然，有一些明顯的地方，無論是工業、倉庫還是數據中心的東西，有一些我們關注的自然地方，考慮到趨勢。所以我對我們所做的事情感覺很好。

I would say the way I think about it, we primarily in certain geographies and our coverage and in growth markets that were important to cover, and that's how we thought about it. So I actually think we're pretty well positioned. But the other thing, since the pandemic, everybody expected it. I mean, again, this isn't some new and the other thing, the secondary city versus the primary city, in my view, is also something that kind of -- you kind of knew when you anticipated as you thought about staffing approach.

我會說我的想法，我們主要在某些地區和我們的覆蓋範圍以及重要的增長市場，這就是我們的想法。所以我實際上認為我們的定位非常好。但另一方面，自大流行以來，每個人都預料到了。我的意思是，再一次，這不是什麼新鮮事，在我看來，二級城市與主要城市的對比也是一種——你在考慮人員配置方法時就知道什麼時候預期了。

But one of the interesting things about us is we've always had a great reputation from an underwriting point of view. We issued it because of our uncertainty of being "for sale" 3 years ago, and the notion of our we had a lot less capital back then. We weren't a relevant third player. We were but we were less better way to say it. We're now very relevant. The question is, do we have the right capabilities in the right markets to impact the business?

但關於我們的一件有趣的事情是，從承保的角度來看，我們一直享有很高的聲譽。我們發行它是因為 3 年前我們不確定是否“待售”，以及我們當時的資本少得多的想法。我們不是相關的第三者。我們是，但我們不是更好的說法。我們現在非常相關。問題是，我們是否具備在正確市場中影響業務的正確能力？

And by the way, I would also say that's true in the direct offices at the low end of commercial where we didn't have as many people dedicated to that segment as we needed to have and will have going forward because that's going to be a vibrant segment for most -- when you look at all our secondary cities, it's still the most powerful segment. So again, I think we've been thoughtful about this, I'm not worried about necessarily office in or (inaudible) The retail has been held up a little bit more expected retail is the other one. So I think everybody anticipated was you weren't going to belong into retail. And so we were pretty thoughtful about how we thought that adding these sources.

順便說一句，我還要說的是，在商業低端的直屬辦公室中，我們沒有足夠多的人致力於該領域，因為我們需要擁有並且將會繼續前進，因為這將是對大多數人來說充滿活力的部分——當你看看我們所有的二線城市時，它仍然是最強大的部分。所以，我想我們已經考慮過了，我並不擔心一定是辦公室或（聽不清）零售業已經被阻止了一點，更多的是預期零售業是另一個。所以我想每個人都預料到你不會屬於零售業。因此，我們對添加這些來源的想法深思熟慮。

Right. And then you've mentioned a few times balancing expense management with longer-term investments. But how long can you sustain that balance? You could paint a scenario that maybe mortgage rates start loosening up, but if the consumer starts running into economic pressure, the estimates for originations this year, next year could still prove optimistic, and it looks like the spring selling season starting off soft. At what point do you have to start cutting muscle? Or do you just kind of bear down and endure it?

正確的。然後你多次提到平衡費用管理和長期投資。但是你能維持這種平衡多久呢？你可以描繪一個場景，抵押貸款利率可能開始放鬆，但如果消費者開始面臨經濟壓力，那麼今年、明年的貸款發放估計仍可能樂觀，看起來春季銷售旺季開始疲軟。什麼時候開始減肌？還是你只是有點承受和忍受它？

Yes. I feel -- again, I do feel like we're best to do. It's a great question. So about a couple of things I would refer you to. I (inaudible) about $18 million to $20 million and I identify as discretionary investments in long-term stuff for the year. That's about (inaudible) a quarter so I could have made a little bit of money this quarter or close to.

是的。我覺得——再一次，我確實覺得我們最好這樣做。這是一個很好的問題。所以我會向你推薦幾件事。我（聽不清）大約 1800 萬到 2000 萬美元，我認為這是今年對長期項目的可自由支配投資。這大約是（聽不清）一個季度，所以我本可以在這個季度或接近這個季度賺到一點錢。

And as a apart of kind of the data management stuff we're doing. We're doing some -- we kind of work on kind of centralization, and we've got some stuff we're doing on balancing where we do our search work and the cost of delivery of search work. And if I look at those initiatives, if we give you probably a couple -- I believe, a couple of hundred basis points of improvement in margin over the next 18 to 24 months. And they're discretionary.

作為我們正在做的數據管理工作的一部分。我們正在做一些——我們在集中化方面做了一些工作，我們正在做一些事情來平衡我們進行搜索工作的地方和搜索工作的交付成本。如果我看看這些舉措，如果我們可能給你幾個——我相信，在未來 18 到 24 個月內，利潤率會提高幾百個基點。他們是酌情決定的。

But we're well into them. I think the right thing to do. In some cases, you could characterize them as we're catching up through our competition. And that's what I was referring as discretionary. There's another way to think about it, which is we have taken -- we take a much weak action as anybody that we compete against. The issue with my view is that I don't think there's a lot of great alternatives to go for. So I think there's always good hygiene and as things shift, as commercial gets weaker than there are some things that we could do on a targeted basis.

但我們很喜歡他們。我認為正確的做法。在某些情況下，您可以將它們描述為我們在競爭中迎頭趕上。這就是我所說的自由裁量權。還有另一種思考方式，我們已經採取了這種方式——我們採取的行動與我們競爭的任何人一樣弱。我的觀點的問題是我不認為有很多很棒的選擇可供選擇。因此，我認為始終保持良好的衛生習慣，並且隨著情況的變化，隨著商業活動變得越來越弱，我們可以有針對性地做一些事情。

But we've done kind of what I feel is appropriate. And it will be so if we went a lot further. Now again, the market is going to be down 50% continuously. You got to rethink that, but the whole industry is going to have to hit that. So I don't -- again, we're a little easy because of the seasonality of us more so than others. But I think we've managed our expenses well. I think we're in a good place to actually have increasing margin through the rest of the year. So I feel okay with that.

但我們做了一些我認為合適的事情。如果我們走得更遠，情況就會如此。現在，市場將再次下跌 50%。你必須重新考慮這一點，但整個行業都將不得不打擊這一點。所以我不 - 再一次，我們有點容易，因為我們比其他人更容易季節性。但我認為我們已經很好地管理了我們的開支。我認為我們處於一個很好的位置，可以在今年餘下的時間裡實際提高利潤率。所以我覺得沒問題。

The other point I would make is I mentioned in the last call, one place I feel like we just haven't done enough yet is our interest income on escrow. And when we first started the journey, we looked at the bank and as we do money was that quarter of point. So nobody was interested in deposits. We are working hard at creating partnerships with a couple of banks to make sure that we're extracting on our couple billion dollars of escrow, some interest return, which again, changes our margin at this level of volume.

我要說的另一點是我在上次電話中提到的，我覺得我們做得還不夠的一個地方是我們的託管利息收入。當我們第一次開始旅程時，我們看著銀行，當我們做錢時，那是四分之一點。所以沒有人對存款感興趣。我們正在努力與幾家銀行建立合作夥伴關係，以確保我們正在提取數十億美元的託管資金，一些利息回報，這再次改變了我們在這個數量水平上的利潤率。

And so I think we can do get that done by the end of the year and it kind of helps our profile relatively materially. And so that's the one lever kind of, I believe, we need to aggressively act on that we have. As far as the portfolio stuff, one of the other questions today was our data business has been growing, and that is more stable at a low volume like this. And so I think we're doing some things on the offensive side that will enhance our margins if the market stays at this low.

所以我認為我們可以在年底前完成這項工作，這對我們的形像有相對實質性的幫助。因此，我認為這是一種槓桿，我們需要積極採取行動。就投資組合而言，今天的另一個問題是我們的數據業務一直在增長，而且在像這樣的低容量下更穩定。因此，我認為我們正在進攻端做一些事情，如果市場保持在這麼低的水平，這將提高我們的利潤率。

So I actually think that in most all scenarios, we're going to enhance margins through the year. So I feel pretty good about where we are. But again, it's something we work at pretty hard. And I (inaudible) 20 because it's an exclusive decision we made. I think the right decision at the that is the tremendous because I think the improvement. I think somebody asked me on previous calls. The problem with that improvement is if we don't have volume, we don't get the full benefit of those improvements in efficiency. But we'll get to higher volume soon here that those will be more transparent. So I feel like they want to take it.

所以我實際上認為，在大多數情況下，我們將在全年提高利潤率。所以我對我們所處的位置感覺很好。但同樣，這是我們非常努力的工作。我（聽不清）20，因為這是我們做出的獨家決定。我認為當時的正確決定是巨大的，因為我認為改進。我想有人在之前的電話中問過我。這種改進的問題是，如果我們沒有體積，我們就無法從這些效率改進中獲得全部好處。但是我們很快就會達到更高的音量，這樣會更加透明。所以我覺得他們想接受它。

And it appears that there are no further questions at this time. I'll turn the call back over to the management for closing remarks.

並且目前似乎沒有進一步的問題。我會把電話轉回給管理層作結束語。

I want to thank everybody for joining us for this quarter's call. Thank you so much for your attention.

我要感謝大家參加本季度的電話會議。非常感謝您的關注。

Thank you for your participation. You may disconnect.

感謝您的參與。您可能會斷開連接。