UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT PURSUANT
TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported)
October 11, 2005
FIRST ADVANTAGE CORPORATION
(Exact Name of Registrant as Specified in Its Charter)
Delaware
(State or Other Jurisdiction of Incorporation)
| Delaware | 001-31666 | 61-1437565 | ||
| (State or Other Jurisdiction of incorporation) |
(Commission File Number) |
(IRS Employer Identification Number) |
One Progress Plaza, Suite 2400
St. Petersburg, Florida 33701
(Address of principal executive offices)
(727) 214-3411
(Registrant’s telephone number)
Not Applicable.
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2 below):
| ¨ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| ¨ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ¨ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ¨ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
| Item 8.01. | Other Events. |
On September 14, 2005, First Advantage Corporation (“First Advantage”) consummated the acquisition of the Credit Information Group (“CIG”) Business and related businesses from The First American Corporation (“First American”). The acquisition of this Business by First Advantage is a transaction between businesses under the common control of First American. In acquisitions of businesses under common control, the acquiring company generally records acquired assets and liabilities at historical cost. Historical income statements of the acquirer are restated to include operations of the acquired business at historical cost assuming the acquisition was completed at the beginning of the respective period. Included as Exhibit 99.1 is the unaudited combined quarterly financial information by segment for the six months ended June 30, 2005 and the two years ended December 31, 2004.
On September 20, 2005, First Advantage issued a press release regarding the restructuring of their business segments to reflect the realignment of the company’s business lines following the recent acquisition of the CIG Business, as well as to better structure the company for continued strategic growth. A description of the businesses included in each segment is included in the press release. A copy of this release is being furnished as Exhibit 99.2.
The following table shows the realigned reportable segments:
Previous reportable segments
Enterprise Screening
Risk Mitigation
Consumer Direct
Corporate and Eliminations
New reportable segments
Lender Services
Data Services
Dealer Services
Employer Services
Multifamily Services
Investigation and Litigation Support Services
Corporate and Eliminations
| Item 9.01. | Financial Statements and Exhibits. |
| (c) | Exhibits |
| 99.1 | First Advantage unaudited combined quarterly financial information by segment for the six months ended June 30, 2005 and the two years ended December 31, 2004 | |
| 99.2 | Press release, dated September 20, 2005, issued by First Advantage | |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| FIRST ADVANTAGE CORPORATION | ||
| By: | /s/ John Lamson | |
| Name: |
John Lamson | |
| Title: |
Executive Vice President and Chief Financial Officer | |
Dated: October 11, 2005
Exhibit 99.1
First Advantage Corporation
Unaudited Combined Financial Information By Segment
| Six months ended June 30, 2005 | Lender Services |
Data Services |
Dealer Services |
Employer Services |
Multifamily Services |
Investigative/Litigation Support Services |
Corporate |
Total | |||||||||||||||||
| Service revenue |
$ | 85,056,000 | $ | 39,760,000 | $ | 43,033,000 | $ | 65,133,000 | $ | 32,711,000 | $ | 14,905,000 | $ | (1,322,000 | ) | $ | 279,276,000 | ||||||||
| Reimbursed government fee revenue |
— | 20,162,000 | — | 5,460,000 | — | — | (1,153,000 | ) | 24,469,000 | ||||||||||||||||
| Total revenue |
85,056,000 | 59,922,000 | 43,033,000 | 70,593,000 | 32,711,000 | 14,905,000 | (2,475,000 | ) | 303,745,000 | ||||||||||||||||
| Cost of service revenue |
27,573,000 | 5,304,000 | 21,119,000 | 20,030,000 | 4,195,000 | 6,246,000 | (1,322,000 | ) | 83,145,000 | ||||||||||||||||
| Government fees paid |
— | 20,162,000 | — | 5,460,000 | — | — | (1,153,000 | ) | 24,469,000 | ||||||||||||||||
| Total cost of service |
27,573,000 | 25,466,000 | 21,119,000 | 25,490,000 | 4,195,000 | 6,246,000 | (2,475,000 | ) | 107,614,000 | ||||||||||||||||
| Gross margin |
57,483,000 | 34,456,000 | 21,914,000 | 45,103,000 | 28,516,000 | 8,659,000 | — | 196,131,000 | |||||||||||||||||
| Salaries and benefits |
25,264,000 | 7,239,000 | 6,213,000 | 23,616,000 | 10,598,000 | 5,131,000 | 5,601,000 | 83,662,000 | |||||||||||||||||
| Other operating expenses |
4,412,000 | 10,529,000 | 8,145,000 | 11,460,000 | 7,168,000 | 2,088,000 | 6,619,000 | 50,421,000 | |||||||||||||||||
| Depreciation and amortization |
3,182,000 | 2,938,000 | 998,000 | 2,475,000 | 1,980,000 | 761,000 | 66,000 | 12,400,000 | |||||||||||||||||
| Income (loss) from operations |
$ | 24,625,000 | $ | 13,750,000 | $ | 6,558,000 | $ | 7,552,000 | $ | 8,770,000 | $ | 679,000 | $ | (12,286,000 | ) | $ | 49,648,000 | ||||||||
First Advantage Corporation
Unaudited Combined Financial Information By Segment
| Quarter ending June 30, 2005 | Lender Services |
Data Services |
Dealer Services |
Employer Services |
Multifamily Services |
Investigative/Litigation Support Services |
Corporate |
Total | |||||||||||||||||
| Service revenue |
$ | 45,853,000 | $ | 20,864,000 | $ | 23,540,000 | $ | 35,985,000 | $ | 17,721,000 | $ | 7,899,000 | $ | (691,000 | ) | $ | 151,171,000 | ||||||||
| Reimbursed government fee revenue |
— | 9,930,000 | — | 2,920,000 | — | — | (597,000 | ) | 12,253,000 | ||||||||||||||||
| Total revenue |
45,853,000 | 30,794,000 | 23,540,000 | 38,905,000 | 17,721,000 | 7,899,000 | (1,288,000 | ) | 163,424,000 | ||||||||||||||||
| Cost of service revenue |
14,989,000 | 2,883,000 | 11,893,000 | 10,808,000 | 2,276,000 | 3,154,000 | (691,000 | ) | 45,312,000 | ||||||||||||||||
| Government fees paid |
— | 9,930,000 | — | 2,920,000 | — | — | (597,000 | ) | 12,253,000 | ||||||||||||||||
| Total cost of service |
14,989,000 | 12,813,000 | 11,893,000 | 13,728,000 | 2,276,000 | 3,154,000 | (1,288,000 | ) | 57,565,000 | ||||||||||||||||
| Gross margin |
30,864,000 | 17,981,000 | 11,647,000 | 25,177,000 | 15,445,000 | 4,745,000 | — | 105,859,000 | |||||||||||||||||
| Salaries and benefits |
13,499,000 | 3,553,000 | 3,456,000 | 12,683,000 | 5,585,000 | 2,743,000 | 2,868,000 | 44,387,000 | |||||||||||||||||
| Other operating expenses |
2,729,000 | 5,487,000 | 4,433,000 | 6,774,000 | 3,216,000 | 1,132,000 | 6,329,000 | 30,100,000 | |||||||||||||||||
| Depreciation and amortization |
1,792,000 | 1,476,000 | 596,000 | 1,403,000 | 967,000 | 376,000 | 35,000 | 6,645,000 | |||||||||||||||||
| Income (loss) from operations |
$ | 12,844,000 | $ | 7,465,000 | $ | 3,162,000 | $ | 4,317,000 | $ | 5,677,000 | $ | 494,000 | $ | (9,232,000 | ) | $ | 24,727,000 | ||||||||
First Advantage Corporation
Unaudited Combined Financial Information By Segment
| Quarter ending March 31, 2005 | Lender Services |
Data Services |
Dealer Services |
Employer Services |
Multifamily Services |
Investigative/Litigation Support Services |
Corporate |
Total | |||||||||||||||||
| Service revenue |
$ | 39,203,000 | $ | 18,896,000 | $ | 19,493,000 | $ | 29,148,000 | $ | 14,990,000 | $ | 7,006,000 | $ | (631,000 | ) | $ | 128,105,000 | ||||||||
| Reimbursed government fee revenue |
— | 10,232,000 | — | 2,540,000 | — | — | (556,000 | ) | 12,216,000 | ||||||||||||||||
| Total revenue |
39,203,000 | 29,128,000 | 19,493,000 | 31,688,000 | 14,990,000 | 7,006,000 | (1,187,000 | ) | 140,321,000 | ||||||||||||||||
| Cost of service revenue |
12,584,000 | 2,421,000 | 9,226,000 | 9,222,000 | 1,919,000 | 3,092,000 | (631,000 | ) | 37,833,000 | ||||||||||||||||
| Government fees paid |
— | 10,232,000 | — | 2,540,000 | — | — | (556,000 | ) | 12,216,000 | ||||||||||||||||
| Total cost of service |
12,584,000 | 12,653,000 | 9,226,000 | 11,762,000 | 1,919,000 | 3,092,000 | (1,187,000 | ) | 50,049,000 | ||||||||||||||||
| Gross margin |
26,619,000 | 16,475,000 | 10,267,000 | 19,926,000 | 13,071,000 | 3,914,000 | — | 90,272,000 | |||||||||||||||||
| Salaries and benefits |
11,765,000 | 3,686,000 | 2,757,000 | 10,933,000 | 5,013,000 | 2,388,000 | 2,733,000 | 39,275,000 | |||||||||||||||||
| Other operating expenses |
1,683,000 | 5,042,000 | 3,712,000 | 4,686,000 | 3,952,000 | 956,000 | 290,000 | 20,321,000 | |||||||||||||||||
| Depreciation and amortization |
1,390,000 | 1,462,000 | 402,000 | 1,072,000 | 1,013,000 | 385,000 | 31,000 | 5,755,000 | |||||||||||||||||
| Income (loss) from operations |
$ | 11,781,000 | $ | 6,285,000 | $ | 3,396,000 | $ | 3,235,000 | $ | 3,093,000 | $ | 185,000 | $ | (3,054,000 | ) | $ | 24,921,000 | ||||||||
First Advantage Corporation
Unaudited Combined Financial Information By Segment
| Year ending December 31, 2004 | Lender Services |
Data Services |
Dealer Services |
Employer Services |
Multifamily Services |
Investigative/Litigation Support Services |
Corporate |
Total | |||||||||||||||||
| Service revenue |
$ | 135,201,000 | $ | 74,905,000 | $ | 69,842,000 | $ | 113,129,000 | $ | 55,801,000 | $ | 25,714,000 | $ | (2,450,000 | ) | $ | 472,142,000 | ||||||||
| Reimbursed government fee revenue |
— | 34,452,000 | — | 10,147,000 | — | — | — | 44,599,000 | |||||||||||||||||
| Total revenue |
135,201,000 | 109,357,000 | 69,842,000 | 123,276,000 | 55,801,000 | 25,714,000 | (2,450,000 | ) | 516,741,000 | ||||||||||||||||
| Cost of service revenue |
39,920,000 | 16,556,000 | 32,512,000 | 39,224,000 | 7,693,000 | 13,002,000 | (2,450,000 | ) | 146,457,000 | ||||||||||||||||
| Government fees paid |
— | 34,453,000 | — | 10,146,000 | — | — | — | 44,599,000 | |||||||||||||||||
| Total cost of service |
39,920,000 | 51,009,000 | 32,512,000 | 49,370,000 | 7,693,000 | 13,002,000 | (2,450,000 | ) | 191,056,000 | ||||||||||||||||
| Gross margin |
95,281,000 | 58,348,000 | 37,330,000 | 73,906,000 | 48,108,000 | 12,712,000 | — | 325,685,000 | |||||||||||||||||
| Salaries and benefits |
43,726,000 | 11,759,000 | 11,538,000 | 39,323,000 | 20,049,000 | 7,492,000 | 9,094,000 | 142,981,000 | |||||||||||||||||
| Other operating expenses |
6,552,000 | 26,881,000 | 16,042,000 | 19,825,000 | 11,847,000 | 3,136,000 | 1,744,000 | 86,027,000 | |||||||||||||||||
| Depreciation and amortization |
6,946,000 | 5,346,000 | 1,586,000 | 4,110,000 | 3,940,000 | 1,176,000 | 80,000 | 23,184,000 | |||||||||||||||||
| Income (loss) from operations |
$ | 38,057,000 | $ | 14,362,000 | $ | 8,164,000 | $ | 10,648,000 | $ | 12,272,000 | $ | 908,000 | $ | (10,918,000 | ) | $ | 73,493,000 | ||||||||
| Total assets |
$ | 58,389,000 | $ | 155,854,000 | $ | 84,629,000 | $ | 169,839,000 | $ | 80,466,000 | $ | 44,749,000 | $ | 9,339,000 | $ | 603,265,000 | |||||||||
First Advantage Corporation
Unaudited Combined Financial Information By Segment
| Quarter ending December 31, 2004 | Lender Services |
Data Services |
Dealer Services |
Employer Services |
Multifamily Services |
Investigative/Litigation Support Services |
Corporate |
Total | |||||||||||||||||
| Service revenue |
$ | 31,721,000 | $ | 18,111,000 | $ | 16,820,000 | $ | 30,263,000 | $ | 12,690,000 | $ | 7,027,000 | $ | (1,016,000 | ) | $ | 115,616,000 | ||||||||
| Reimbursed government fee revenue |
— | 8,699,000 | — | 2,331,000 | — | — | — | 11,030,000 | |||||||||||||||||
| Total revenue |
31,721,000 | 26,810,000 | 16,820,000 | 32,594,000 | 12,690,000 | 7,027,000 | (1,016,000 | ) | 126,646,000 | ||||||||||||||||
| Cost of service revenue |
9,957,000 | 2,493,000 | 8,155,000 | 9,192,000 | 1,641,000 | 3,134,000 | (1,016,000 | ) | 33,556,000 | ||||||||||||||||
| Government fees paid |
— | 8,700,000 | — | 2,330,000 | — | — | — | 11,030,000 | |||||||||||||||||
| Total cost of service |
9,957,000 | 11,193,000 | 8,155,000 | 11,522,000 | 1,641,000 | 3,134,000 | (1,016,000 | ) | 44,586,000 | ||||||||||||||||
| Gross margin |
21,764,000 | 15,617,000 | 8,665,000 | 21,072,000 | 11,049,000 | 3,893,000 | — | 82,060,000 | |||||||||||||||||
| Salaries and benefits |
11,119,000 | 3,141,000 | 3,089,000 | 10,504,000 | 4,540,000 | 2,392,000 | 2,320,000 | 37,105,000 | |||||||||||||||||
| Other operating expenses |
1,976,000 | 5,191,000 | 3,670,000 | 5,994,000 | 2,842,000 | 828,000 | 934,000 | 21,435,000 | |||||||||||||||||
| Depreciation and amortization |
1,624,000 | 1,464,000 | 407,000 | 764,000 | 1,377,000 | 386,000 | 28,000 | 6,050,000 | |||||||||||||||||
| Income (loss) from operations |
$ | 7,045,000 | $ | 5,821,000 | $ | 1,499,000 | $ | 3,810,000 | $ | 2,290,000 | $ | 287,000 | $ | (3,282,000 | ) | $ | 17,470,000 | ||||||||
First Advantage Corporation
Unaudited Combined Financial Information By Segment
| Quarter ending September 30, 2004 | Lender Services |
Data Services |
Dealer Services |
Employer Services |
Multifamily Services |
Investigative/Litigation Support Services |
Corporate |
Total | |||||||||||||||||
| Service revenue |
$ | 33,870,000 | $ | 16,678,000 | $ | 18,355,000 | $ | 31,325,000 | $ | 16,204,000 | $ | 6,770,000 | $ | (337,000 | ) | $ | 122,865,000 | ||||||||
| Reimbursed government fee revenue |
— | 8,427,000 | — | 2,781,000 | — | — | — | 11,208,000 | |||||||||||||||||
| Total revenue |
33,870,000 | 25,105,000 | 18,355,000 | 34,106,000 | 16,204,000 | 6,770,000 | (337,000 | ) | 134,073,000 | ||||||||||||||||
| Cost of service revenue |
10,020,000 | 2,957,000 | 8,652,000 | 10,769,000 | 2,117,000 | 3,041,000 | (337,000 | ) | 37,219,000 | ||||||||||||||||
| Government fees paid |
— | 8,427,000 | — | 2,781,000 | — | — | — | 11,208,000 | |||||||||||||||||
| Total cost of service |
10,020,000 | 11,384,000 | 8,652,000 | 13,550,000 | 2,117,000 | 3,041,000 | (337,000 | ) | 48,427,000 | ||||||||||||||||
| Gross margin |
23,850,000 | 13,721,000 | 9,703,000 | 20,556,000 | 14,087,000 | 3,729,000 | — | 85,646,000 | |||||||||||||||||
| Salaries and benefits |
10,802,000 | 2,735,000 | 2,932,000 | 10,879,000 | 5,318,000 | 1,956,000 | 2,396,000 | 37,018,000 | |||||||||||||||||
| Other operating expenses |
2,266,000 | 4,577,000 | 4,242,000 | 4,623,000 | 3,359,000 | 818,000 | 563,000 | 20,448,000 | |||||||||||||||||
| Depreciation and amortization |
1,657,000 | 1,307,000 | 404,000 | 1,232,000 | 912,000 | 343,000 | 23,000 | 5,878,000 | |||||||||||||||||
| Income (loss) from operations |
$ | 9,125,000 | $ | 5,102,000 | $ | 2,125,000 | $ | 3,822,000 | $ | 4,498,000 | $ | 612,000 | $ | (2,982,000 | ) | $ | 22,302,000 | ||||||||
First Advantage Corporation
Unaudited Combined Financial Information By Segment
| Quarter ending June 30, 2004 | Lender Services |
Data Services |
Dealer Services |
Employer Services |
Multifamily Services |
Investigative/Litigation Support Services |
Corporate |
Total | ||||||||||||||||||
| Service revenue |
$ | 34,614,000 | $ | 19,844,000 | $ | 17,802,000 | $ | 28,758,000 | $ | 15,986,000 | $ | 6,643,000 | $ | (540,000 | ) | $ | 123,107,000 | |||||||||
| Reimbursed government fee revenue |
— | 8,167,000 | — | 2,720,000 | — | — | — | 10,887,000 | ||||||||||||||||||
| Total revenue |
34,614,000 | 28,011,000 | 17,802,000 | 31,478,000 | 15,986,000 | 6,643,000 | (540,000 | ) | 133,994,000 | |||||||||||||||||
| Cost of service revenue |
10,057,000 | 5,855,000 | 8,264,000 | 10,085,000 | 2,431,000 | 3,349,000 | (540,000 | ) | 39,501,000 | |||||||||||||||||
| Government fees paid |
— | 8,167,000 | — | 2,720,000 | — | — | — | 10,887,000 | ||||||||||||||||||
| Total cost of service |
10,057,000 | 14,022,000 | 8,264,000 | 12,805,000 | 2,431,000 | 3,349,000 | (540,000 | ) | 50,388,000 | |||||||||||||||||
| Gross margin |
24,557,000 | 13,989,000 | 9,538,000 | 18,673,000 | 13,555,000 | 3,294,000 | — | 83,606,000 | ||||||||||||||||||
| Salaries and benefits |
10,629,000 | 2,793,000 | 2,825,000 | 9,844,000 | 5,640,000 | 1,730,000 | 2,356,000 | 35,817,000 | ||||||||||||||||||
| Other operating expenses |
1,155,000 | 10,310,000 | 4,244,000 | 4,763,000 | 3,303,000 | 835,000 | 327,000 | 24,937,000 | ||||||||||||||||||
| Depreciation and amortization |
1,736,000 | 1,306,000 | 405,000 | 1,165,000 | 913,000 | 271,000 | 20,000 | 5,816,000 | ||||||||||||||||||
| Income (loss) from operations |
$ | 11,037,000 | $ | (420,000 | ) | $ | 2,064,000 | $ | 2,901,000 | $ | 3,699,000 | $ | 458,000 | $ | (2,703,000 | ) | $ | 17,036,000 | ||||||||
First Advantage Corporation
Unaudited Combined Financial Information By Segment
| Quarter ending March 31, 2004 | Lender Services |
Data Services |
Dealer Services |
Employer Services |
Multifamily Services |
Investigative/Litigation Support Services |
Corporate |
Total | ||||||||||||||||||
| Service revenue |
$ | 34,996,000 | $ | 20,272,000 | $ | 16,865,000 | $ | 22,783,000 | $ | 10,921,000 | $ | 5,274,000 | $ | (557,000 | ) | $ | 110,554,000 | |||||||||
| Reimbursed government fee revenue |
— | 9,159,000 | — | 2,315,000 | — | — | — | 11,474,000 | ||||||||||||||||||
| Total revenue |
34,996,000 | 29,431,000 | 16,865,000 | 25,098,000 | 10,921,000 | 5,274,000 | (557,000 | ) | 122,028,000 | |||||||||||||||||
| Cost of service revenue |
9,886,000 | 5,251,000 | 7,441,000 | 9,178,000 | 1,504,000 | 3,478,000 | (557,000 | ) | 36,181,000 | |||||||||||||||||
| Government fees paid |
— | 9,159,000 | — | 2,315,000 | — | — | — | 11,474,000 | ||||||||||||||||||
| Total cost of service |
9,886,000 | 14,410,000 | 7,441,000 | 11,493,000 | 1,504,000 | 3,478,000 | (557,000 | ) | 47,655,000 | |||||||||||||||||
| Gross margin |
25,110,000 | 15,021,000 | 9,424,000 | 13,605,000 | 9,417,000 | 1,796,000 | — | 74,373,000 | ||||||||||||||||||
| Salaries and benefits |
11,176,000 | 3,090,000 | 2,692,000 | 8,096,000 | 4,551,000 | 1,414,000 | 2,022,000 | 33,041,000 | ||||||||||||||||||
| Other operating expenses |
1,155,000 | 6,803,000 | 3,886,000 | 4,445,000 | 2,343,000 | 655,000 | (80,000 | ) | 19,207,000 | |||||||||||||||||
| Depreciation and amortization |
1,929,000 | 1,269,000 | 370,000 | 949,000 | 738,000 | 176,000 | 9,000 | 5,440,000 | ||||||||||||||||||
| Income (loss) from operations |
$ | 10,850,000 | $ | 3,859,000 | $ | 2,476,000 | $ | 115,000 | $ | 1,785,000 | $ | (449,000 | ) | $ | (1,951,000 | ) | $ | 16,685,000 | ||||||||
First Advantage Corporation
Unaudited Combined Financial Information By Segment
| Year ending December 31, 2003 | Lender Services |
Data Services |
Dealer Services |
Employer Services |
Multifamily Services |
Investigative/Litigation Support Services |
Corporate |
Total | ||||||||||||||||||
| Service revenue |
$ | 151,220,000 | $ | 56,479,000 | $ | 66,912,000 | $ | 64,715,000 | $ | 42,865,000 | $ | 8,065,000 | $ | (1,480,000 | ) | $ | 388,776,000 | |||||||||
| Reimbursed government fee revenue |
— | 27,201,000 | — | 4,384,000 | — | — | — | 31,585,000 | ||||||||||||||||||
| Total revenue |
151,220,000 | 83,680,000 | 66,912,000 | 69,099,000 | 42,865,000 | 8,065,000 | (1,480,000 | ) | 420,361,000 | |||||||||||||||||
| Cost of service revenue |
42,741,000 | 10,918,000 | 29,206,000 | 28,018,000 | 5,958,000 | 4,763,000 | (1,480,000 | ) | 120,124,000 | |||||||||||||||||
| Government fees paid |
— | 27,201,000 | — | 4,384,000 | — | — | — | 31,585,000 | ||||||||||||||||||
| Total cost of service |
42,741,000 | 38,119,000 | 29,206,000 | 32,402,000 | 5,958,000 | 4,763,000 | (1,480,000 | ) | 151,709,000 | |||||||||||||||||
| Gross margin |
108,479,000 | 45,561,000 | 37,706,000 | 36,697,000 | 36,907,000 | 3,302,000 | — | 268,652,000 | ||||||||||||||||||
| Salaries and benefits |
43,664,000 | 10,981,000 | 12,193,000 | 22,271,000 | 17,920,000 | 1,733,000 | 3,938,000 | 112,700,000 | ||||||||||||||||||
| Other operating expenses |
14,020,000 | 23,283,000 | 13,719,000 | 11,233,000 | 9,282,000 | 853,000 | 2,717,000 | 75,107,000 | ||||||||||||||||||
| Depreciation and amortization |
8,825,000 | 3,590,000 | 1,815,000 | 4,896,000 | 3,112,000 | 213,000 | 7,000 | 22,458,000 | ||||||||||||||||||
| Income (loss) from operations |
$ | 41,970,000 | $ | 7,707,000 | $ | 9,979,000 | $ | (1,703,000 | ) | $ | 6,593,000 | $ | 503,000 | $ | (6,662,000 | ) | $ | 58,387,000 | ||||||||
| Total assets |
$ | 62,859,000 | $ | 135,633,000 | $ | 84,156,000 | $ | 107,979,000 | $ | 55,167,000 | $ | 19,810,000 | $ | 1,083,000 | $ | 466,687,000 | ||||||||||
First Advantage Corporation
Unaudited Combined Financial Information By Segment
| Quarter ending December 31, 2003 | Lender Services |
Data Services |
Dealer Services |
Employer Services |
Multifamily Services |
Investigative/Litigation Support Services |
Corporate |
Total | ||||||||||||||||||
| Service revenue |
$ | 27,950,000 | $ | 17,285,000 | $ | 14,913,000 | $ | 20,149,000 | $ | 9,235,000 | $ | 6,124,000 | $ | (405,000 | ) | $ | 95,251,000 | |||||||||
| Reimbursed government fee revenue |
— | 7,499,000 | — | 1,363,000 | — | — | — | 8,862,000 | ||||||||||||||||||
| Total revenue |
27,950,000 | 24,784,000 | 14,913,000 | 21,512,000 | 9,235,000 | 6,124,000 | (405,000 | ) | 104,113,000 | |||||||||||||||||
| Cost of service revenue |
7,886,000 | 3,936,000 | 6,208,000 | 9,067,000 | 1,296,000 | 3,619,000 | (405,000 | ) | 31,607,000 | |||||||||||||||||
| Government fees paid |
— | 7,499,000 | — | 1,363,000 | — | — | — | 8,862,000 | ||||||||||||||||||
| Total cost of service |
7,886,000 | 11,435,000 | 6,208,000 | 10,430,000 | 1,296,000 | 3,619,000 | (405,000 | ) | 40,469,000 | |||||||||||||||||
| Gross margin |
20,064,000 | 13,349,000 | 8,705,000 | 11,082,000 | 7,939,000 | 2,505,000 | — | 63,644,000 | ||||||||||||||||||
| Salaries and benefits |
10,334,000 | 3,260,000 | 2,685,000 | 6,743,000 | 4,041,000 | 1,330,000 | 1,116,000 | 29,509,000 | ||||||||||||||||||
| Other operating expenses |
2,867,000 | 8,663,000 | 3,174,000 | 4,078,000 | 1,994,000 | 651,000 | 879,000 | 22,306,000 | ||||||||||||||||||
| Depreciation and amortization |
2,112,000 | 1,039,000 | 427,000 | 2,730,000 | 714,000 | 179,000 | 7,000 | 7,208,000 | ||||||||||||||||||
| Income (loss) from operations |
$ | 4,751,000 | $ | 387,000 | $ | 2,419,000 | $ | (2,469,000 | ) | $ | 1,190,000 | $ | 345,000 | $ | (2,002,000 | ) | $ | 4,621,000 | ||||||||
First Advantage Corporation
Unaudited Combined Financial Information By Segment
| Quarter ending September 30, 2003 | Lender Services |
Data Services |
Dealer Services |
Employer Services |
Multifamily Services |
Investigative/Litigation Support Services |
Corporate |
Total | |||||||||||||||||
| Service revenue |
$ | 37,580,000 | $ | 16,810,000 | $ | 16,931,000 | $ | 18,556,000 | $ | 11,899,000 | $ | 1,941,000 | $ | (440,000 | ) | $ | 103,277,000 | ||||||||
| Reimbursed government fee revenue |
— | 6,819,000 | — | 1,260,000 | — | — | — | 8,079,000 | |||||||||||||||||
| Total revenue |
37,580,000 | 23,629,000 | 16,931,000 | 19,816,000 | 11,899,000 | 1,941,000 | (440,000 | ) | 111,356,000 | ||||||||||||||||
| Cost of service revenue |
10,751,000 | 2,814,000 | 7,569,000 | 7,711,000 | 1,677,000 | 1,144,000 | (440,000 | ) | 31,226,000 | ||||||||||||||||
| Government fees paid |
— | 6,819,000 | — | 1,260,000 | — | — | — | 8,079,000 | |||||||||||||||||
| Total cost of service |
10,751,000 | 9,633,000 | 7,569,000 | 8,971,000 | 1,677,000 | 1,144,000 | (440,000 | ) | 39,305,000 | ||||||||||||||||
| Gross margin |
26,829,000 | 13,996,000 | 9,362,000 | 10,845,000 | 10,222,000 | 797,000 | — | 72,051,000 | |||||||||||||||||
| Salaries and benefits |
10,930,000 | 3,216,000 | 3,016,000 | 6,379,000 | 4,580,000 | 403,000 | 1,100,000 | 29,624,000 | |||||||||||||||||
| Other operating expenses |
2,939,000 | 6,668,000 | 3,191,000 | 3,570,000 | 2,375,000 | 202,000 | 850,000 | 19,795,000 | |||||||||||||||||
| Depreciation and amortization |
2,208,000 | 1,241,000 | 374,000 | 831,000 | 710,000 | 34,000 | — | 5,398,000 | |||||||||||||||||
| Income (loss) from operations |
$ | 10,752,000 | $ | 2,871,000 | $ | 2,781,000 | $ | 65,000 | $ | 2,557,000 | $ | 158,000 | $ | (1,950,000 | ) | $ | 17,234,000 | ||||||||
First Advantage Corporation
Unaudited Combined Financial Information By Segment
| Quarter ending June 30, 2003 | Lender Services |
Data Services |
Dealer Services |
Employer Services |
Multifamily Services |
Investigative/Litigation Support Services |
Corporate |
Total | |||||||||||||||||
| Service revenue |
$ | 45,825,000 | $ | 12,916,000 | $ | 16,972,000 | $ | 13,944,000 | $ | 12,187,000 | $ | — | $ | (312,000 | ) | $ | 101,532,000 | ||||||||
| Reimbursed government fee revenue |
— | 6,378,000 | — | 909,000 | — | — | — | 7,287,000 | |||||||||||||||||
| Total revenue |
45,825,000 | 19,294,000 | 16,972,000 | 14,853,000 | 12,187,000 | — | (312,000 | ) | 108,819,000 | ||||||||||||||||
| Cost of service revenue |
12,955,000 | 2,323,000 | 7,724,000 | 5,920,000 | 1,688,000 | — | (312,000 | ) | 30,298,000 | ||||||||||||||||
| Government fees paid |
— | 6,378,000 | — | 909,000 | — | — | — | 7,287,000 | |||||||||||||||||
| Total cost of service |
12,955,000 | 8,701,000 | 7,724,000 | 6,829,000 | 1,688,000 | — | (312,000 | ) | 37,585,000 | ||||||||||||||||
| Gross margin |
32,870,000 | 10,593,000 | 9,248,000 | 8,024,000 | 10,499,000 | — | — | 71,234,000 | |||||||||||||||||
| Salaries and benefits |
11,432,000 | 2,439,000 | 2,968,000 | 4,540,000 | 4,927,000 | — | 781,000 | 27,087,000 | |||||||||||||||||
| Other operating expenses |
4,111,000 | 4,838,000 | 3,571,000 | 2,051,000 | 2,522,000 | — | 516,000 | 17,609,000 | |||||||||||||||||
| Depreciation and amortization |
2,245,000 | 774,000 | 391,000 | 658,000 | 744,000 | — | — | 4,812,000 | |||||||||||||||||
| Income (loss) from operations |
$ | 15,082,000 | $ | 2,542,000 | $ | 2,318,000 | $ | 775,000 | $ | 2,306,000 | $ | — | $ | (1,297,000 | ) | $ | 21,726,000 | ||||||||
First Advantage Corporation
Unaudited Combined Financial Information By Segment
| Quarter ending March 31, 2003 | Lender Services |
Data Services |
Dealer Services |
Employer Services |
Multifamily Services |
Investigative/Litigation Support Services |
Corporate |
Total | ||||||||||||||||||
| Service revenue |
$ | 39,865,000 | $ | 9,468,000 | $ | 18,096,000 | $ | 12,066,000 | $ | 9,544,000 | $ | — | $ | (323,000 | ) | $ | 88,716,000 | |||||||||
| Reimbursed government fee revenue |
— | 6,505,000 | — | 852,000 | — | — | — | 7,357,000 | ||||||||||||||||||
| Total revenue |
39,865,000 | 15,973,000 | 18,096,000 | 12,918,000 | 9,544,000 | — | (323,000 | ) | 96,073,000 | |||||||||||||||||
| Cost of service revenue |
11,149,000 | 1,845,000 | 7,705,000 | 5,320,000 | 1,297,000 | — | (323,000 | ) | 26,993,000 | |||||||||||||||||
| Government fees paid |
— | 6,505,000 | — | 852,000 | — | — | — | 7,357,000 | ||||||||||||||||||
| Total cost of service |
11,149,000 | 8,350,000 | 7,705,000 | 6,172,000 | 1,297,000 | — | (323,000 | ) | 34,350,000 | |||||||||||||||||
| Gross margin |
28,716,000 | 7,623,000 | 10,391,000 | 6,746,000 | 8,247,000 | — | — | 61,723,000 | ||||||||||||||||||
| Salaries and benefits |
10,968,000 | 2,066,000 | 3,524,000 | 4,609,000 | 4,372,000 | — | 941,000 | 26,480,000 | ||||||||||||||||||
| Other operating expenses |
4,103,000 | 3,114,000 | 3,783,000 | 1,534,000 | 2,391,000 | — | 472,000 | 15,397,000 | ||||||||||||||||||
| Depreciation and amortization |
2,260,000 | 536,000 | 623,000 | 677,000 | 944,000 | — | — | 5,040,000 | ||||||||||||||||||
| Income (loss) from operations |
$ | 11,385,000 | $ | 1,907,000 | $ | 2,461,000 | $ | (74,000 | ) | $ | 540,000 | $ | — | $ | (1,413,000 | ) | $ | 14,806,000 | ||||||||
Exhibit 99.2
100 Carillon Parkway · St. Petersburg, FL 33701
NEWS FOR IMMEDIATE RELEASE
| First Advantage Contacts: | ||
| Renee Svec | Cindy Williams | |
| Director - Marketing & Communications | Investor Relations Manager | |
| 727.214.3411, ext. 212 | 727.214.3438 | |
| rsvec@FADV.com | clwilliams@FADV.com |
FIRST ADVANTAGE ANNOUNCES NEW REPORTING SEGMENTS
ST. PETERSBURG, Fla., Sept. 20, 2005—First Advantage Corporation (NASDAQ: FADV), a global risk mitigation and business solutions provider, today introduced its new business segments to reflect the realignment of the company’s business lines following the recent acquisition of the Credit Information Group (CIG) of The First American Corporation, as well as to better structure the company for continued strategic growth.
John Long, chief executive officer of First Advantage said, “First Advantage’s rapid growth over the past two years has dramatically changed our company. Through dozens of acquisitions, we have built scale in existing business lines, expanded our product set, extended our geographic reach, pursued new vertical markets and created cross selling opportunities between our business lines. Today, we are a leading business information provider that can offer services to virtually every organization worldwide to help drive their efficiency and to make smarter business decisions.”
The new business segments better reflect the current organization, position First Advantage for ongoing growth and provide greater operational transparency to stakeholders. The company’s six business segments are: Data Services, Dealer Services, Employer Services, Investigative and Litigation Support Services, Lender Services and Multifamily Services.
The Data Services segment includes business lines that provide transportation credit reporting, motor vehicle record reporting, fleet management, supply chain theft and damage mitigation consulting, consumer location, criminal records reselling, subprime credit reporting, and consumer credit reporting services. These First Advantage units collect and manage data to provide insightful information to support the needs of businesses and consumers nationally and, in some business lines, internationally.
The Dealer Services business segment serves the automotive dealer marketplace by delivering consolidated consumer credit reports, credit automation software and lead development services.
The Employer Services segment is comprised of the business lines that deliver global employment background verifications, occupational health services, tax credits and
-more-
First Advantage Announces New Reporting Segments
Page 2
incentives programs and other business tax consulting services that are frequently sold to support organization’s human resource functions.
The Investigative and Litigation Support Services segment consists of the business lines that support businesses, insurers and law firms nationwide with their insurance fraud investigations, surveillance, computer forensics, electronic discovery, data recovery, due diligence reporting and corporate and litigation investigative needs.
The business lines in the Lender Services segment offers lenders across the country credit reporting solutions for mortgage and home equity needs.
Finally, the Multifamily Services segment’s business lines include resident screening, property management software and renters insurance services—providing solutions to property owners and managers across the nation.
About First Advantage Corporation
First Advantage Corporation (NASDAQ: FADV) combines industry expertise with information to create products and services that organizations worldwide use to make smarter business decisions. First Advantage is a leading provider of business credit information in the transportation industry; consumer credit information in the mortgage, automotive and subprime markets; motor vehicle record reports; supply chain security consulting; employment background verifications; occupational health services; business tax consulting services; insurance fraud, corporate and litigation investigations; surveillance; computer forensics; electronic discovery; data recovery; due diligence reporting; resident screening; property management software; renters insurance and consumer location services. First Advantage ranks among the top three companies in all of its major business lines. First Advantage is headquartered in St. Petersburg, Fla., and has 3,300 employees in offices throughout the United States and abroad. More information about First Advantage can be found at www.FADV.com.
First Advantage is a majority-owned subsidiary of The First American Corporation (NYSE: FAF), a Fortune 500 company that traces its history to 1889. First American is the nation’s largest data provider, supplying businesses and consumers with information resources in connection with the major economic events of people’s lives. Additional information about the First American Family of Companies can be found at www.firstam.com.
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