Cannae Q1 Earnings Call Highlights

Key Points

• Cannae prioritized shareholder returns in Q1, returning about $51 million year-to-date through buybacks and its regular dividend. The company repurchased 3.4 million shares, or about 7.3% of shares outstanding, and expanded its repurchase authorization to 14.9 million shares.
• Black Knight Football was highlighted as the top growth asset, with AFC Bournemouth sitting in sixth place in the Premier League at the time of the call and potentially heading for its first-ever European competition berth. Management said the multi-club sports platform is generating meaningful player-trading profits and improved EBITDA.
• Cannae continues to work on monetizing non-core restaurant assets while reducing holding company costs. The company said restaurant operations remain under strategic review, operating revenue fell due to closures and weaker traffic, and corporate holding costs were down roughly 45% year over year.

Cannae NYSE: CNNE said it returned the bulk of its first-quarter capital allocation to shareholders while continuing to evaluate sales of non-core holdings and emphasizing growth in its sports-related investments.

On the company’s first-quarter 2026 earnings call, Chief Executive Officer Ryan Caswell said Cannae returned approximately $51 million to shareholders year-to-date through buybacks and its regular dividend, which he said currently provides a 4.2% yield. That represented about 86% of capital allocated during the period, compared with roughly 70% a year earlier.

“The shift toward buybacks was deliberate in the quarter as we viewed the highest return investment available to us was our own equity,” Caswell said.

Buybacks Remain a Central Capital Allocation Tool

Caswell said Cannae repurchased 3.4 million shares year-to-date, representing about 7.3% of shares outstanding, for $43 million. The board expanded the company’s repurchase authorization to 14.9 million shares during the quarter, giving Cannae room to continue opportunistic repurchases.

Asked by Kenneth Lee of RBC Capital Markets about capital returns, Caswell said Cannae remains committed to buybacks and has not evaluated special dividends. He said the company continues to assess capital allocation based on what it believes will maximize shareholder value between capital returns and new investments.

In response to a question from Oscar Nieves of Stephens about whether Cannae could use a structured buyback process similar to a prior tender offer, Caswell said the company is currently focused on open-market repurchases. He said a tender could be considered if the company could not obtain desired volume or pricing, but noted that after the prior tender, Cannae bought shares at a premium and the stock traded down.

Black Knight Football Performance Highlighted

Caswell described Black Knight Football as Cannae’s largest single portfolio position and “the asset with the greatest upside.” He said AFC Bournemouth was in sixth place in the Premier League at the time of the call. If maintained, that position would mark the highest finish in the club’s 127-year history and qualify the club for European competition for the first time.

Caswell said European qualification would materially change the club’s commercial, branding and economic profile. He also said the performance was notable because Black Knight Football had sold top players to Manchester City, Real Madrid, Paris Saint-Germain and Liverpool over the past 18 months, generating roughly $360 million in transfer fees.

Caswell pointed to 19-year-old Eli Junior Kroupi as an example of Black Knight Football’s multi-club model. He said Kroupi came through the academy at FC Lorient, which Black Knight Football owns, and was acquired by AFC Bournemouth while remaining at Lorient for the rest of the season to continue developing. Caswell said Kroupi later moved to Bournemouth, became the club’s leading scorer and scored more goals in a single Premier League season than any teenager in Premier League history.

“That is the multi-club platform in one transaction,” Caswell said, adding that the model can benefit both clubs economically and competitively while improving a player’s career trajectory.

Chief Financial Officer Bryan Coy said Black Knight Football’s total revenue rose 19% to $274 million for the 12 months ended Dec. 31, 2025. EBITDA increased to $136 million in 2025 from $12 million in 2024, driven by player trading profits that rose to $113 million from $30 million. Adjusted EBITDA, excluding player trading profits, improved to $21 million from a loss of $5 million, reflecting better operating leverage net of higher player wages.

Restaurant Business Remains Non-Core

Caswell said the strategic review of Cannae’s restaurant group remains ongoing and that the board’s position is unchanged: the restaurants are non-core assets. He said the company’s focus is to monetize the business, maximize proceeds and redeploy the capital into higher-return investments or Cannae stock.

“We are working hard to achieve this outcome and expect to be able to give you a more substantive update on the next call,” Caswell said.

Coy said first-quarter operating revenue totaled $96 million, down 7% from the prior year, with the decline entirely attributable to the restaurant group. He said the decrease reflected the closure of eight O’Charley’s locations since March of last year and lower traffic at both brands. At Ninety Nine, higher average guest checks nearly offset the traffic decline, while at O’Charley’s pricing recovered roughly half of the traffic decline.

Total operating expenses were $118 million, down from $125 million in the prior-year quarter. Coy said the cost of restaurant revenues fell by just over $7 million on lower sales volume, but that decrease was offset by approximately $8 million in non-cash impairments tied to restaurant right-of-use assets and fixed assets.

Holding Company Costs Decline

Cannae also emphasized reduced holding company costs. Caswell said first-quarter corporate holding company costs were down approximately 45% from last year. Coy said holding company expenses were $8.9 million in the first quarter of 2026, compared with $16.1 million a year earlier, a reduction of $7.2 million.

Coy attributed the decline to a $3.6 million decrease in corporate personnel costs due to lower bonus and stock compensation following the management transition, as well as the absence of management or termination fees compared with $3.6 million in such fees in the prior-year period. He said Cannae expects the current run rate to continue through the remainder of the year.

Caswell also said the board refreshed committee composition during the quarter to include four new directors elected last year and continues to evaluate additional governance enhancements.

Liquidity and Portfolio Outlook

At quarter-end, Cannae had $123 million of cash at the corporate level, Coy said. After continued buybacks following the quarter close, cash stood at approximately $90 million. Coy said the company filed its corporate tax return and refund claim in March and expects to receive about $45 million in cash refund proceeds and approximately $10 million of additional tax assets later this year, after part of the refund was recharacterized as carryforwards.

Coy said Cannae terminated its margin loan during the first quarter, reducing commitment and custody fees by approximately $350,000 annually. Following the termination, the company’s only corporate-level debt is $48 million of 5% fixed-rate, interest-only term debt that matures in more than four years.

During the question-and-answer session, Caswell said Cannae continues to review its entire portfolio with the board each quarter and will disclose divestiture decisions when appropriate. While the company is focused on shifting toward sports and entertainment-related assets, he said Cannae still sees attractive attributes in its current investments. Caswell also said Cannae is reviewing potential new investment opportunities but is weighing them against the value of additional share repurchases.

“We believe that transitioning the portfolio to the sports-related assets will create the most shareholder value over time,” Caswell said.

About Cannae NYSE: CNNE

Cannae Holdings, Inc NYSE: CNNE is a publicly traded diversified holding company that focuses on partnering with and investing in businesses across a range of industry sectors. The company seeks to identify attractive opportunities in both private and public markets, leveraging its capital resources and management expertise to support operational growth and value creation. Cannae's investment strategy emphasizes companies in data and analytics, marketing services, healthcare technology, and payment processing.

Through its portfolio, Cannae holds controlling or significant minority stakes in companies that provide critical software, data and services to corporate clients.

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