Second Quarter 2024
Earnings Call Transcript

August 8, 2024

Cannae Holdings, Inc. – Second Quarter 2024 Financial Results Conference Call, August 8, 2024

CORPORATE PARTICIPANTS

Jamie Lillis, Managing Director, Solebury Strategic Communications
Ryan Caswell, President
Bryan Coy, Chief Financial Officer

CONFERENCE CALL PARTICIPANTS

Jonathan Bass, Stephens Inc.
Kenneth Lee, RBC Capital Markets

PRESENTATION

Operator
Good afternoon, ladies and gentlemen, and welcome to the Cannae Holdings, Inc. Second Quarter 2024
Financial Results Conference Call.
During today’s presentation, all parties will be in a listen-only mode. Following the Company’s prepared
remarks, the conference will be open for questions, with instructions to follow at that time.
As a reminder, this conference call is being recorded and a replay is available through 11:59 p.m. Eastern
Time on August 15, 2024.
With that, I would like to turn the call over to Jamie Lillis of Solebury Strategic Communications. Please go
ahead.
Jamie Lillis
Thank you, Operator, and all of you for joining us.
On the call today, we have Ryan Caswell, Cannae’s President, and Bryan Coy, our Chief Financial
Officer.
Before we begin, I would like to remind listeners that this conference call and the Q&A following ourremarks may contain forward-looking statements that involve a number of risks and uncertainties.
Statements that are not historical facts, including statements about Cannae’s expectations, hopes,
intentions or strategies regarding the future are forward-looking statements. Forward-looking statements
are based on Management’s beliefs, as well as assumptions made by, and information currently available
to, Management. Because such statements are based on expectations as to future financial and
1
ViaVid has made considerable efforts to provide an accurate transcription. There may be material errors, omissions, or inaccuracies in thereporting of the substance of the conference call. This transcript is being made available for information purposes only.
1-888-562-0262 1-604-929-1352 www.viavid.com

Cannae Holdings, Inc. – Second Quarter 2024 Financial Results Conference Call, August 8, 2024
operating results and are not statements of fact, actual results may differ materially from those projected.
The Company undertakes no obligation to update any forward-looking statements, whether as a result of
new information, future events, or otherwise. The risks and uncertainties which forward-looking
statements are subject to include, but are not limited to, the risks and other factors detailed in ourquarterly shareholder letter, which was released this afternoon, and in our other filings with the SEC.
Today’s remarks will also include references to non-GAAP financial measures. Additional information,
including a reconciliation between non-GAAP financial information to the GAAP financial information, is
provided in our shareholder letter.
I would now like to turn the call over to Ryan.
Ryan CaswellThank you, Jamie.
Good afternoon, everyone, and thank you for joining us on our second quarter conference call.
First off, I want to note that Bill is unable to join the call today, as he is traveling. He will be back on thecall next quarter.
Consistent with past earnings calls, we will provide some high-level commentary on strategy and key
events during the second quarter, before turning to a more detailed discussion of some of our portfolio
companies, and finish with some financial details.
We continue to focus on executing our strategic plan, designed to grow both the net asset value, or NAV,
of our portfolio while also working to close our share price discount to NAV. Our strategy has three mainlevers, including: improving the performance and valuation of our portfolio companies; making newinvestments, primarily in private businesses that will produce cash flows and grow NAV; and providing
capital returns to our shareholders through either our recently introduced cash dividend or share
repurchases. We believe the combination of these three strategic pillars will close the value gap between
our stock price and NAV.
We remain optimistic about our portfolio companies and have spent considerable time this quarterworking with the Management Teams of each to enact strategic transactions, improve operations anddrive additional cash flow.
For example, Alight was able to close on the sale of their Payroll and Professional Services businesses
for up to $1.2 billion of consideration. This required significant time and effort from Alight’s Management
Team and Board, and we appreciate all of the work from each to get such an instrumental transaction
over the line.
With regards to D&B, Bill and the D&B Board continue to work with the Management Team to drive
revenue growth, improve free cash flow conversion, and consider strategic transactions which we believe
will drive shareholder value.
We also spent considerable time this quarter with the Management Team of the Restaurant Group and
Minden Mill, focused on refining their strategic plans with regards to sales targets and optimizing theirrespective expense bases, which we believe will maximize cash flow and increase their valuation andCannae’s NAV.

2
ViaVid has made considerable efforts to provide an accurate transcription. There may be material errors, omissions, or inaccuracies in thereporting of the substance of the conference call. This transcript is being made available for information purposes only.
1-888-562-0262 1-604-929-1352 www.viavid.com

Cannae Holdings, Inc. – Second Quarter 2024 Financial Results Conference Call, August 8, 2024
Unfortunately, not all of our portfolio companies performed to expectation, and during the second quarter,
we took a $141 million impairment on the book value of our Sightline investment. Sightline has been
unable to get the expected market adoption on its key products and while Management remains optimistic
about the future, we believe that given the results to date and cash position of the company, we wererequired to impair our investment.
Moving on to our investment pipeline, we continue to look for new, attractive investment opportunities that
we believe will increase our NAV. We are primarily focused on platform investments in the private
markets. As stated before, we plan to fund any new acquisition through redeploying capital from the saleof some of our public company investments.
I would now like to provide a bit more detail on our partnership to date with JANA Partners and resulting
potential investment opportunities.
Since the announcement in Q1, we spent considerable time with the team at JANA looking forundervalued public companies where there is a specific catalyst to unlock value and Cannae canparticipate in that catalyst as an acquirer or capital solution. Cannae’s participation, and as a potential
capital source, provides JANA an additional tool to push for change at the target company, while at thesame time creating potential investment opportunities for Cannae. In certain situations, Cannae may takea position in the target company stock as we see how the process plays out and if there are any potential
large or capital investment opportunities.
In Q2, we made our first investment alongside JANA. While I don’t want to discuss the specifics of thatsituation given its public nature, we remain optimistic that our partnership with JANA will produce
attractive acquisition opportunities for Cannae.
I would now like to discuss capital returns to shareholders.
On September 30, we will be paying our second dividend of $0.12 per share. We also bought back
300,000 shares in the second quarter, following the 9.7 million shares we bought back in our tender in
Q1, bringing our year-to-date purchases to 10 million shares. Between the dividend and share buybacks,
we have returned over $235 million of capital to our shareholders in 2024.
Turning to our portfolio companies, our largest holding, Dun & Bradstreet, reported second quarter
revenue of $576 million, representing 4.3% year-over-year organic growth, which is an acceleration, as
compared to 3.9% organic growth in the prior year second quarter, and the fourth consecutive quarter of
mid-single-digit growth. The company generated 5.7% growth in Adjusted EBITDA in the second quarter,
which equated to $218 million at a 37.8% margin, up 60 basis points as compared to the year ago second
quarter. Leverage at D&B today has moved down to 3.7 times, and Management expects to be at 3.5
times by the end of this year.
On Monday, D&B issued a statement acknowledging that it has received inbound interest from third
parties and has retained advisors to assist with those enquiries. We will not make any comments on thismatter going forward.
Our second largest holding, Alight, announced Tuesday that Stephan Scholl will step down as CEO and amember of the Board, effective after the Board names a successor. We wanted to thank Stephan for his
commitment and vision, and for the impact he has made as CEO.
Post closing of the sale of the previously referenced payroll and professional services business, Alightused $740 million of the proceeds to repay debt, bringing Alight’s net leverage down to 2.8 times. The
company repurchased $80 million of Alight shares in the second quarter, and announced at $75 million
3
ViaVid has made considerable efforts to provide an accurate transcription. There may be material errors, omissions, or inaccuracies in thereporting of the substance of the conference call. This transcript is being made available for information purposes only.
1-888-562-0262 1-604-929-1352 www.viavid.com

Cannae Holdings, Inc. – Second Quarter 2024 Financial Results Conference Call, August 8, 2024
accelerated share repurchase mid-June, leaving $93 million of share buyback authorization. We believe
this transaction is a positive for Alight and that the remaining business is a simpler public equity story thatwill have more recurring revenue, with higher EBITDA margins. This is evidenced by Management’scomments that they already have 97% of its 2024 revenue under contract, and the company forecast asecond half 2024 Adjusted EBITDA margin range between 25% and 26% for the full year, and reaffirmed
a mid-term Adjusted EBITDA margin target of 28%.
Looking at Alight’s second quarter results, which exclude discontinued operations, the Company
generated $538 million of revenue from continuing operations in the 2024 quarter, down 4% from the$561 million in the prior year. Second quarter 2024 Adjusted EBITDA from continuing operations was$105 million, representing a 19.5% margin, compared to $119 million, or a 21.2% margin, in the 2023
quarter.
Turning to Black Knight Football. In our first full year of ownership at AFC Bournemouth, the teamfinished in 12th place in the Premier League Table and earned 48 points, the most the Cherries haveearned in a Premier League season. This success is also translating to revenue growth for AFC
Bournemouth, as revenue for the 12 months ended June 30, 2024, grew to approximately $203 million, a
19% increase from the $170 million in the corresponding period ended June 30, 2023. The uptick was
primarily driven by improvements of more than 40% in both sponsorship and hospitality revenue, as wellas higher Premier League income from Bournemouth’s higher placement in the Table. Looking forward,
we continue to see positive momentum, both from the commercial and sporting perspective.
At FC Lorient, where we own 40%, the club finished in 17th place and was relegated to Ligue 2 for theupcoming season. While we are frustrated with the result, we believe the team has the resources andtalent to quickly return to Ligue 1. Furthermore, our put collar arrangement to buy the remaining stake of
FC Lorient contemplated this potential scenario and our valuation for the remaining stake is reduced while
the team is in Ligue 2.
Hibernian FC, which we have a 25% interest, finished the season in 8th place, out of 12 clubs, in the
Scottish Premiership League.
We continue to also build out the BKFC holding company, given our belief that an interconnected, multiclub ownership model can best deliver improved sporting outcomes, create better player pathways,
enhance fan and community experiences, and improve commercial revenues and profitability across thegroup.
As part of that strategy, in June, we announced that Tim Bezbatchenko has been hired as BKFC’s first
President. Prior to BKFC, Tim enjoyed tremendous success in leadership roles within Major League
Soccer. Tim will work with our portfolio clubs to standardize and improve player recruiting anddevelopment, enhance player pathways, and optimize commercial opportunities across the group.
Lastly, I would like to provide a few updates on Minden Mill and the Restaurant Group, given the work
during the previous quarter.
We continue to make progress at Minden Mill, and it released its first product, an ultra-premium vodka,
called High Ground Vodka, which was well received by the market. The distillery is on track for a fourth
quarter release of Minden Mill bourbon, rye and American single-malt whiskey brands from inventory
acquired in the May 2023 acquisition and has already begun a more scaled development of additional
brown liquors that require four-plus years of aging.
Moving on to the Restaurant Group, following the strategic reduction in store locations discussed lastquarter, we have continued with our realignment and are reducing corporate overhead. This quarter, we
4
ViaVid has made considerable efforts to provide an accurate transcription. There may be material errors, omissions, or inaccuracies in thereporting of the substance of the conference call. This transcript is being made available for information purposes only.
1-888-562-0262 1-604-929-1352 www.viavid.com

Cannae Holdings, Inc. – Second Quarter 2024 Financial Results Conference Call, August 8, 2024
laid off approximately 20% of the corporate employees and are in the process of reducing third-party
spending and downsizing the Group’s headquarters. Our work has already produced positive results, as
second quarter 2024 Adjusted EBITDA was more than twice that of the prior year second quarter. Our
Management Team is focused on improving cash flow and increasing the guest counts at our locations,which is key to long-term profitability at the store and corporate levels.
We believe the actions at both Minden Mill and the Restaurant Group will improve cash flows andincrease their respective values.
I will now turn the call over to Bryan.
Bryan CoyThanks, Ryan.
I’ll briefly cover the P&L, balance sheet and liquidity.
Second quarter 2024 operating revenues were down $35 million, or 23%, compared to the prior year
quarter, reflecting a 27% reduction in the number of restaurant locations year-over-year. Same store
sales on the remaining locations were down slightly, with lower guest counts offset by higher average
checks.
Cost of restaurant revenues fell at a greater pace than revenues, dropping to 85.6% of restaurant
revenues in the second quarter of 2024, compared to 88.4% in the second quarter of ’23, a 280-basispoint improvement resulting from the reduction of four-wall, or onsite, costs.
The remainder of operating expenses comprise personnel costs, depreciation, and other operating
expenses. These expenses, which include the restaurant and the real estate businesses, as well as
Cannae corporate, increased $4.8 million in the aggregate, or approximately 11% quarter-over-quarter.
The drivers for this increase include an ISIP bonus related to sales of Dayforce shares during the 2024
quarter, notably on which Cannae realized a $27 million gain over the pre-IPO basis, as well as higher
stock comp and termination fees. These were offset by significant decreases in the Restaurant Groupimpairments and expenses, as well as reduction in professional fees at the Cannae corporate level.
Recognized losses of $145 million in the second quarter reflect a non-cash impairment charge to thebook value of Sightline, while decreased losses from equity method investments relate to the prior year
write-down of System1.
I’ll also give you a little bit more detail on the impairment of Sightline and the rational behind it. The lack oftraction with their legacy products, combined with investments in completing development of a new
product, caused further pressure on their operational results and liquidity through the second quarter. In
light of continued negative cash flows from operations, uncertainty in future financial and operational
forecasts, and a challenged liquidity position, we had a valuation of the company prepared and, based on
those results, we recorded an impairment charge to the book value of our investment. With that said,
we’re hopeful the company begins to see better results, and we’ll continue to work with Sightline
Management Team.
Cannae’s balance sheet and liquidity position remain solid.
Since March 31, we’ve sold 1 million shares of Dayforce for gross proceeds of $57 million. We’re now
down to 500,000 shares remaining out of the 37.1 million shares we held at Dayforce’s IPO. We’ll use this5
ViaVid has made considerable efforts to provide an accurate transcription. There may be material errors, omissions, or inaccuracies in thereporting of the substance of the conference call. This transcript is being made available for information purposes only.
1-888-562-0262 1-604-929-1352 www.viavid.com

Cannae Holdings, Inc. – Second Quarter 2024 Financial Results Conference Call, August 8, 2024
capital for new investments, investments in the growth of our existing portfolio, as well as capital returns
to our shareholders.
Cannae has approximately $29 million in corporate cash today, and has nothing drawn on its margin loan,leaving $150 million of immediate capacity on that facility. The only outstanding debt presently is $60
million under the term note that matures near the end of 2025. Cannae also, notably, has $1.3 billion ofmarketable securities that could be utilized for future liquidity.
At close today, Cannae’s aggregate NAV was $2.1 billion, or $32.90 per Cannae share, compared to
today’s closing price of $19.95.
With that, I’ll now turn the call back to the Operator to begin our Q&A session.
OperatorThank you. At this time, if you would like to ask a question, please press the star and one on yourtelephone keypad. You may remove yourself from the queue at any time by pressing star and two. We’ll
pause for a moment to allow questions to queue.
We will take our first question from John Campbell with Stephens.
Jonathan Bass
Hey, guys. It’s Jonathan Bass on for John. Thanks for taking my questions. I know you can’t comment
directly on the D&B take-out rumors, so I’d love to hear just at a high level a refresh on your investment
thesis for D&B, and why you guys view the valuation so steeply discounted here. Thanks.
Ryan Caswell
So, I guess the thesis when we made the investment, or kind of how we view valuation today? Is that—what are you trying to get at? I apologize.
Jonathan Bass
Yes, that’s right, just what your thesis was when you got into D&B and maybe just your thesis, if you
could.
Ryan CaswellThanks for the clarification. When we initially invested in the business, we thought it was an undervalued
business that had kind of great data assets, great market penetration, and we believed that there wassome obvious cost savings that we could enact in the business, as well as we could invest in product toimprove the revenue growth.
We think we have done a lot of it. We think Anthony and the team have done a lot of those things, if you
look at the growth in the EBITDA since our deal, as well as kind of they’ve turned what was—at the timeof the acquisition was kind of a flat revenue business to 4.3% organic growth. With that all being said,
we’re frustrated where the business is, where the business trades, but we think the team is on the rightpath and they’re doing the right things to create additional value at D&B.

6
ViaVid has made considerable efforts to provide an accurate transcription. There may be material errors, omissions, or inaccuracies in thereporting of the substance of the conference call. This transcript is being made available for information purposes only.
1-888-562-0262 1-604-929-1352 www.viavid.com

Cannae Holdings, Inc. – Second Quarter 2024 Financial Results Conference Call, August 8, 2024
Jonathan Bass
Got it, thanks. Then, turning to Bournemouth here, they had a really nice season, finishing at the midlevel of the Table, which is a solid improvement from the prior year, and it seems like your guys’ strategy
is playing out nicely there, so I want to touch on two things here. One, could you just speak to the level ofinvestment you guys expect over the course of the next year, and as the club looks at starting its new
season here shortly; and then maybe after that, at this point, given what the club has done, would you
guys consider taking some ownership off the table?
Ryan Caswell
On the first question, we’re still in the middle of the transfer window, so kind of the exact capital needs forthe club, given the importance of buying and selling players, we need to determine kind of the exact
squad makeup before, I think, we have a real view of kind of the capital needs or the capital position of
the club will be, so I think we’ll have to hold off on that. I do think at Bournemouth, there will be some ofthat amount of investment over the season, but what that is, we’re still trying to figure out, based on what
happens over the next month of the window.
Then, in terms of taking ownership off the table, I don’t think in the near term we are looking to do that.
Unless, obviously, if someone came up and offered us an incredible price, we would think about it, but wethink there are a lot more changes, there are a lot more things that we can do at Bournemouth, and Black
Knight Football more broadly, to create shareholder value.
Jonathan Bass
Got it. Thank you, guys.
OperatorThank you. We will take our next question from Ian Zaffino with Oppenheimer.
Ian Zaffino
Thank you very much. Maybe on Alight here. Like you’ve said, Management change, you’ve got the
payroll sales. Is a potential strategic sale of this still something you might consider? I guess the way I
think about is, if you look at the D&B news and then you look at this, maybe to take that money and thenwith that capital, do what you please. Any thoughts there? Thanks.
Ryan Caswell
I’ll answer that in two ways. In terms of a specific sale, or something like that, I mean, I don’t—it’s a publiccompany, obviously, there’s a price out there every day for it, so if people are interested, obviously, they
can come talk to them.
But, in terms of how we think about capital allocation more broadly, I would say that we clearly—as we
mentioned in some of the prepared remarks, as we think about new investments, we have to reallocate
capital from some of our public company investments into those investments, or into returns of capital toshareholders. Clearly, Dun & Bradstreet and Alight are some of the biggest positions. So, just kind of
depending on the cadence, and when that is, we’ll have to think about kind of all the different things thatare going on as we think about allocating that capital.

7
ViaVid has made considerable efforts to provide an accurate transcription. There may be material errors, omissions, or inaccuracies in thereporting of the substance of the conference call. This transcript is being made available for information purposes only.
1-888-562-0262 1-604-929-1352 www.viavid.com

Cannae Holdings, Inc. – Second Quarter 2024 Financial Results Conference Call, August 8, 2024
Ian Zaffino
Okay, thank you, and then, I guess, the other follow-up would be on capital allocation. You’re buying
stock, but is there a read into that as far as maybe there might not be as many opportunities, or how do
you kind of prioritize buying stock versus returning capital to shareholders? Thanks.
Ryan Caswell
Look, I think we’ve returned quite a bit of capital to shareholders over the first two quarters, between thetender and the dividend. I think we like just doing a dividend, because it’s consistent capital that’s
returned to shareholders every quarter, and obviously, in the first quarter, we bought back about 9.7
million shares, which is a big chunk for us, so we’re letting that kind of, I’ll say, settle out and see kind ofwhere we are. But we believe that the strategy that closes the discount is both a combination of capital
returns to shareholders, including share buybacks, as well as basically investments that are growing
NAV, and we believe those are most likely private company investments, where we can reallocate someof the capital from the public companies into those.
I don’t have a specific view on the allocation, it’s more of, I think, we look at on a case-by-case basis as
we have investments and as we look at kind of where our stock is trading, and we make a decision on
how we want to allocate that capital, but we believe it’s a combination of both of those things.
Ian Zaffino
Okay, thank you very much.
Ryan CaswellThank you.
OperatorThank you. Once again, if you would like to ask a question, please press the star and one on yourtelephone keypad now.
We will take our next question from Kenneth Lee with RBC Capital Markets.
Kenneth Lee
Hey, good afternoon, and thanks for taking my question, just one follow-up on the previous question
there, and perhaps just to put a finer point on it. I realize you can’t talk to much about the D&B strategic
view, but if there was a potentially sizeable monetization of your public portfolio holdings, at this point,
would you lean towards returning the bulk of that excess cash towards repurchases or allocating towards
newer investments, just given the current environment? Thanks.
Ryan Caswell
Look, I think we’d have to think about that when something actually comes up and kind of what is goingon, but, in general, we believe it’s a combination of both, of the share buybacks and the dividend, as wellas kind of investments in businesses. So, what the percentage allocation is, and all that, we’d have tothink about that when the situation comes up, but it’s a combination of those two things.

8
ViaVid has made considerable efforts to provide an accurate transcription. There may be material errors, omissions, or inaccuracies in thereporting of the substance of the conference call. This transcript is being made available for information purposes only.
1-888-562-0262 1-604-929-1352 www.viavid.com

Cannae Holdings, Inc. – Second Quarter 2024 Financial Results Conference Call, August 8, 2024
Kenneth Lee
Got you, okay. Then, for my follow-up, and this one is about the JANA partnership here, more broadly, inthe context of the partnership, what’s sort of like the playbook here, what could we expect in terms of apotential transaction or investment going forward? I realize you can’t talk too much about the Rapid7
investment, but is it sort of like we could see a potential co-investment, where Cannae makes aninvestment in equity along with some other investment firms? I just want to get a better sense of how
future investments or transactions could emerge there. Thanks.
Ryan Caswell
Look, I think it’s—I mean, you understand our capital base. It kind of depends on the size of the businessthat we’re looking at, what that business needs, whether it’s—you know, ideally, it would be an acquisition
opportunity, but could it be another capital solution, and then, depending on the size, we would look topartner with different firms, similar to what we’ve done with D&B, or other take-privates of businesses in
the past. So, again, how the exact the playbook and how it plays out is a bit TBD, given the early stage ofthe partnership, but it’s relying on the skills of JANA to enact change and utilizing Cannae as a capitalsource in a potential acquisition partner to find attractive investments.
Kenneth Lee
Okay, got you, and just one last quick one, if I may, and this is in regards to the impairment charge you
took for Sightline in the quarter there. In terms of the specifics driving the impairment, it sounded as if
there was, if I got it right, a lack of progress in terms of development of a new product.
Was there any kind of changing industry conditions, or anything that changed in terms of potential
adoption by the industry, that also drove the impairment? I just want to get a better understanding there.
Thanks.
Bryan Coy
I can take that one, Ryan, if you want. It’s a little bit backwards, Ken. It’s more of some of their legacy
products were not getting the traction that they wanted while they’re developing—they’ve got a new
product in development, as well, but the combination of those two put quite a bit of pressure on them as
far as cash flow from operations and profitability in the short run.
Kenneth Lee
Got you, okay, helpful there, helpful. I think that’s it. Thank you very much.
Ryan CaswellThanks, Ken.
Bryan CoyThank you, Ken.
OperatorThank you, and it appears that we have no further questions at this time. I will now turn the call back to
Ryan Caswell for closing remarks.
9
ViaVid has made considerable efforts to provide an accurate transcription. There may be material errors, omissions, or inaccuracies in thereporting of the substance of the conference call. This transcript is being made available for information purposes only.
1-888-562-0262 1-604-929-1352 www.viavid.com

Cannae Holdings, Inc. – Second Quarter 2024 Financial Results Conference Call, August 8, 2024

Ryan CaswellThank you, Operator.
To conclude, we have taken significant steps through the first six months of the year to position Cannae
for success, which we believe will lead to NAV growth and narrowing our share price discount. We remain
confident that we are on the right path and are excited with the opportunities that we have in front of us tocreate value for our shareholders.
Thank you again for your time today.
OperatorThank you. This does conclude today’s Cannae Holdings Second Quarter 2024 Earnings Call. Thank you
for your participation. You may disconnect at any time.

10
ViaVid has made considerable efforts to provide an accurate transcription. There may be material errors, omissions, or inaccuracies in thereporting of the substance of the conference call. This transcript is being made available for information purposes only.
1-888-562-0262 1-604-929-1352 www.viavid.com