The following is a summary of the Cannae Holdings, Inc. (CNNE) Q3 2024 Earnings Call Transcript:

Financial Performance:

• Cannae reported Q3 2024 total revenues of $114 million, down from $144 million in the prior year, primarily due to a reduction in restaurant locations.

• Adjusted EBITDA for D&B was $247 million, up 5.1% from the previous year, with a margin expansion of 60 basis points to 40.6%.

• Adjusted operating cash flow for Alight was $199 million, representing 53% of adjusted EBITDA.

Business Progress:

• Cannae continues to rebalance its portfolio, moving from public to private company investments, notably acquiring a major stake in Watkins.

• Significant capital returns to shareholders including $243 million through share buybacks and dividends, with a third quarterly dividend of $0.12 per share announced.

• Successful strategic exits and investments such as the complete divestiture of Dayforce shares and the acquisition of new companies like Watkins and Velocity Solutions via CSI.

Opportunities:

• Watkins provides significant growth opportunities in distribution and product expansion, leveraging strong market positioning in high-growth food categories.

• Potential acquisitions or partnerships via JANA could enhance Cannae's investment strategy and NAV growth.

Risks:

• Ongoing shifts in the portfolio towards more stable and potentially profitable private investments might carry integration and market risks.

• Economic pressures on the casual dining industry impacting guest traffic and revenue despite cost-cutting and strategic pricing efforts.

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