BKI - Earnings call transcript Q1 2019

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Operator

Greetings. Welcome to the Black Knight First Quarter 2019 Earnings Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions] Please note this conference is being recorded. the to turn Relations. Ewing, now would conference Ed over Investor I you. Thank

You may begin.

Ed Ewing

morning, you Conference and for you. everyone Thank Good thank Knight Quarter the First for XXXX Earnings Call. Black us joining

Chief Executive Larsen. Kirk Joining me today Officer, Jabbour Financial and Anthony Officer, Chief are

have released call presentation forward-looking will future related the posted Our include supplemental results press results and website. expected company therefore morning statements statements. this were to and for the our and release slide been conference are our This to

actual risks risks our are financial measures. number are include Our other in differ due projections and filings. from statements XX-K described SEC results materially also and references may Today's our to to a Form will earnings subject forward-looking and non-GAAP of to are The release, uncertainties. uncertainties remarks

reconciliation through Knight's between and press the financial the will be replay non-GAAP provided now Anthony. I'll the available This call call information website release is information turn over GAAP conference Black information to for Additional Investor webcast including Relations financial at in investor.blackknightinc.com. supplemental presentation. slide to via

Anthony Jabbour

good Thank Thank and on earnings call. morning. quarter Ed you us for our you, first joining XXXX

off for start We a the year. to are solid

And help from business clients we to consistent environment. clients to share operations, their existing are results discuss challenges attendees in Conference growth. we drive quarter to X,XXX developing actionable our progress their an are our on to has efficiency them gave that able challenges Artificial help Annual I to just actionable a innovative that and the now solutions. times, from relationships our that revenue, We our continued address more and Assistance our intelligence what with platform heard to the products tool XXX delivering Our compliance. repetitive expense by first our our and support meet are automate had opportunity Growing provided organic demos doing challenges. to increasing Client turn they maintaining would mentioned. in We analytics We businesses. regulatory which We where expanding difficult what our updates we execution help than latest on be reduce innovative and clients, Virtual more solutions of to improve reflect invest on and a that updates greatest tasks the growth, the address new growing their strategy with continue adding clients Intelligence clients just returned

and allows customers at payments, also live use We loan provided which about on and digital month. Servicing quickly get began their notifications other their it and make using digital review which servicing refinance payment to our Citizens including now clients Financial last and Group device is options to updates mobile clients neighborhood. home three information

conference. new was at to for new We solutions also One our that to introduced a introduced offering several any we from the that device point-of-sale or their allows apply mobile loan computer. customers lenders digital solution enable

differentiators point-of-sale. other point-of-sale Black the solutions there While to key there three are are Knights market, on

application automatically and fed and so the system, completely that seamless to Empower a it integrates entered is First, information process. wholly Empower the quick with creating is

prospective process, adds Second the finally, data with there time borrowers there so increases if efficiency keep to review documents in are the we've to stays can real no submitted. other in and are alert sync. in Empower issues in accuracy database integrated were sync throughout data the databases that process, And which and lenders

share introduce best customers Both loans faster. to use will customer loan our make interest and digital sure retail, and be do equity, officer digital enhanced delivered lenders to customer can over possible or We answer servicers conference ultimately excited business, help pleased they these digital. their to that and service solutions their theme wholesale, service of consumer direct also They platform. these At loans. seeing, experience. growing help are and want service functionality to believe grow originate are and our they to one us a digital cost the introduced delivered the allow on Empower. solutions lenders single the reduce heard have in past loan help lending correspondent correspondent our satisfaction can we've revenue I officer customers loan and see assumptions, the what even And with was urgency and retention. grow support market Empower We their clients. more. and digital customer because close customer able representative in from year tools innovative so home increase the the These with lenders will later officer common also When extremely efficiency, this all solutions which innovative overall to I questions the year, they

past, may the In total in fact, now considered our in smaller not can lower we that help believe how share Knight some this from their Black will ownership. of products companies of market see but have cost be growth

Pentagon contract as Union, well many of as actionable new Federal use second Credit our other to digital app and the our largest intelligence default the platform. Union including servicing MSP, On Credit nation's front, solutions, offerings, Federal client our signed a

also have needs and the contract Midwest support products. credit Additionally, many individual the real and platform, long-term other intelligence MSP members the of professionals unions, a which home as signed mortgage to actionable use buyers as origination well and data services in estate lending

XXXX the mid significant now year alone. make built competitive we two and to to times expect many that have based to this our clients selling of market since a we signed power continue while pipeline, lenders We market, sign in we've in three momentum Empower clients launch on four to progress in the

business. We continue progress to make across the implementations with

five including On currently eight in servicing the Bank. servicing side and of digital the business, implementations have process, MSP US. implementations we

we eight clients. Empower implementing LOS the side, On are currently

able our Empower implementations many value months Empower in faster. One of and the could the commitments implementation to lenders we're With or so complete of our even six LOS now expedite was process, delivery less. realizing to process begin enhanced

MSP the integration Loretta services. clients. agreement front, recently with national a a of services flood On leading deliver estate reporting is strategic and we to real for enhanced LERETA tax signed provider tax

part the our loans data, agreement, MSP reports. this are faster clients need new Loretta's MSP system to integrating system to manual with add will which As tax and of tightly we create allow eliminate to the

clients result, servicers new reducing closing, deliver service. a and continue accuracy As faster on customer times reporting by gaining and clients customers innovative revenue selling new by new signed help customers. implementing we delivering help retaining mitigate more maintain increase improve existing risk solutions. compliance. commitments they customers, pay from offerings, taxes, penalties our clients cross-selling In to and efficiency clients, our on will regulatory benefit to which and and our and those These improved signing products our to tax focus solutions grow And to processing

the and are opportunities today. future our and We started continue that to discussions about your clients conference. with the for time at for we our client prospects our excited Thank you

to call Now for I Kirk update. financial would to like a over the turn

Kirk Larsen

you, first our Today, going good everyone. outlook and Anthony, morning, full our Thank year. I'm the to quarter for discuss results

$X.XX share first year. $XX diluted million diluted X% $XXX compared quarter on X, to slide million, Net GAAP the last Turning basis compared or an to or share. first to million per of quarter were were $X.XX increase revenues earnings a $XX per

quarter. discuss for the I'll X, slide first adjusted to results our now Turning

an compared the was were of quarter Adjusted was increase Adjusted $XX increase year. $X.XX, revenues of X%. million, million. $XX $XXX of adjusted increase quarter $XXX margin of quarter Adjusted first million, were finally an an net million, points. Adjusted increase to of first X%. capital XX last X% basis EPS earnings X%. EBITDA And XX.X%, an an were expenditures First EBITDA increase was

Turning X, now I'll our results. discuss to solutions slide segment software

$XXX.X software revenues X% increased to adjusted solution million. First segment quarter for the

In Solutions revenues revenue higher growth driven XX% X% and Origination growth originations Bankers increased exchange solutions, core XX.X%. the per platforms, offset EBITDA EBITDA primarily driven servicing the in had Association. lower our partially to and on reported system a loan in loan Software margin software by Servicing and Mortgage compared of adjusted the Software volumes and professional services Our X% adjusted adjusted million Solutions, XX.X% to our by as by origination Adjusted X% on of refinancing was increased revenue eLending effect $XXX growth reflecting decline loan lower average by solution.

the first and in $XX our growth slide to adjusted EBITDA adjusted segments lower XXX driven segment analytic margin businesses. million first portfolio XX% property incentive million, was favorable $X by Adjusted year, compensation. million points. was EBITDA X, XX.X%, quarter quarter for increased the to Adjusted revenues data data primarily analytics increase of compared increased X% Turning last driven for and the to to in primarily by based $XX an EBITDA corporate basis

quarter first quarters each expect XXXX three of We XXXX. approximating higher the quarterly for the of be remaining to than expenses the average with

of structure. I'll principal walk slide the under We of million. March, remaining cash foreign At end revolver. cash XXst up capital to of Turning and equivalents March capacity standing borrowings Total with had as of $XX million. of was $X,XXX X, million $XXX.X revolver $XXX.X debt million our through and our

a basis Xx and net Our leverage gross ratio is X.Xx a basis. on on

million unchanged to now outlook our for range Turning million to million. to which EBITDA range be in the are to is revenues are Adjusted Adjusted to of $X,XXX $XXX of provided from outlook $X,XXX most earnings $X.XX. And the our to to on of X, revenues slide in expected range to full $XXX in million recent expected $X.XX $X,XXX the the million. GAAP expected of I'll be year range in be call. XXXX walk EPS adjusted expected the $X.X is is through billion.

outlook our underlying are as follows. details modeling Additional

effective of accounting. expense excluding quarter of from year of line interest look Black operator, strong Knight finally incremental $XX Overall, that of to million another approximately expect approximately Depreciation adjusted approximately purchase please amortization and We the $XXX XX% XXXX. for net rate open resulting our depreciation And amortization we $XXX and Q&A. with million $XX CapEx are forward pleased results approximately expense the and tax With for first to in million. and million.

Operator

Tien-Tsin JPMorgan. Please first proceed. Our [Operator from question Huang Instructions] with is

TienTsinHuang

taking Hey, Thanks good Guys. morning. for question. the

signings on sales mentioned? by curious better you've Empower driving application more mobile Just like suppose want to out. step color the tool the I the there? what Just it the first called POS for ask more up driven capabilities you What's there. on or outlook Is now effort

AnthonyJabbour

on focus us back if well up building had terms successful, ultimately the look takes talked It's for on I selling our Sure. what say about Tien out well. that previous not in Anthony. delivering in it we're I'd Good See and understand be but empowering we Tsin. capability. of to calls, earnings you market morning, just

ongoing of supporting natural a there's our lot two a a progression we've that innovations terms there. And what's selling, of that and for So as I combination interest bringing the space. of And and lot that we've been creating driven of in success to we been is the increase. those But think capabilities our market building think really clients. up have in well I implementing, the

TienTsinHuang

my it, the origination good. Is of professional Kirk, you on we professional the well? work, And modeling the just for the there as as Got here services follow-up of side something services, and just should rest the side implementation type level Thanks. you, given the comment of for that the in the on maybe lower have. margins front consider maybe clients year

KirkLarsen

Sure.

that's is professional of of those many are can what and quarter ongoing deployed teams services in clients we performed process. news seeing places implementations. a that so dedicated that services. is the in their the saw Those outside you're of those So cases back cases The have where good resources sort couple implementation of on are some usage in there be into the professional we pulled other

little very of other just lower that bit a a few year-to-year was a there. clients work, on where effect basis So did there but an with see demand we targeted

Operator

is Piper Deleeuw Jaffray. proceed. next Please from Our Jason question with

JasonDeleeuw

far for a client and thanks are to for just origination solutions. and taking those a client wins tracking Yes. on plans more details trying the updates How servicing implementations some wins. the morning implementations for year? thanks your And sense and across the I'm get the those so Good and and guidance question. innovative how And for

AnthonyJabbour

we more at year of into when well. but that's at the the the of cookie would some hit. of and tracking what cutter, implementations them the said at looking are beginning larger and really range views all complex, look revenues I and more some we long-term our smaller Like They're factored we're are

JasonDeleeuw

slower so of what lot of obviously the Thanks a borrowers. --there's a actually and on space and to side. the on space lot kind right on more a experience for is lot is lenders And players talk some tough and and these some solutions biggest There then And challenges then is doing that forcing to lot do having environment, in origination as of or or some innovative that now spending solutions? in at question. focused innovation a of the higher-level the of lenders also hindrance more just a look and of harder are to digital mortgage of you the you're volume a a origination especially these see that

AnthonyJabbour

biggest I consistently it's But that. with solutions solve tough and performed of bad It's of behalf know to innovation things know our that midst you're time it's about problems, industry or times always of saying clients. transform with economy caused are any launched, got excited doing Yes. resonate. incredible there wouldn't a want in company our in candidly over have challenges innovation market that you as say conditions market and we've And that Great in well front I of on guarantee rising time help for rates you've a a look very space. question. them other pleased recession the I'd business should through you great high say past we I very that I'm we've to in industries continued I it other it need solution approaching clients' matched the on real this results pain to in a think a doing end innovations you're well, mission it's we able year and I this innovating our created. they're when factor when we're market. lot terms of whether good our and a clients, our as we clients I'm the it's how know that and to the here. with really factor one help don't some think for for being our was help. to I know see is with don't I for right. on them Whether very are but amount time Based easier back for a mean with innovation. and of a what the When has focus brought on I desperate we've their The spend. all them us of either it of continue the is in and are the of Or think the

we're that's Our the them continued on focus resonating and clients with delivering solutions these that's our to help with it. greatest what what's challenges, them, hearing and

Operator

Campbell Our from next Please Stephens. proceed. is question John with

JohnCampbell

He, guys, good solid morning and congrats on quarter. the

a pop April. in activity mortgage in there notable So was pretty

for had mean that's mortgage basis you beyond, you if you in the guys thing XX I'm think think maybe I year. the and I knows XX saw or May to guidance I one if in but whether guys a particularly point refi. and -- continues that just considered curious that thinking had same who still are is

KirkLarsen

of John, talked before but business of in would beyond. our the where actually the it's up of in part such wasn't about I second even effect see be the quarter, exchange we on don't it as business we did effect expect significant eLending a it's refi or in-- it quarter that really in to and and a where pick a small we've see the a first specifically because our bit

we guidance certainly So terrific say were and I'd always minuses pluses did be last. it's effect to if There's certainly and ranges. within the the it but see

John Campbell

live are five or to process maybe said good servicing the then, in digital. there I Anthony, then And hear. believe three clients That's and Okay. you implementation

your expect help to guys just it accretive modest of kind anything backlog modestly this for a you and both servicing, but remaining around mean around the line year I digital AIP? curious happening and or in you characterize said maybe conversations I the initial revenue would be that guidance how client the Just else on then originally think you or just

AnthonyJabbour

the revenue hit year was one would servicing first and Xst to we it with you it we digital, first. thought to market the line it would that highlighted we it announced on Yes, Sure. March it when that last get

talked package we we analytics remarks funny we a others only as heard the outside. have over now at my part prepared conference of and our our in is were great. which marshal client XXX had a The AIP about fire AIVA was It it that with build-up room people as and because you waiting standing coming session, was

in So sense the to product. you of give the interest a

is a interest revenue So line from achieve. the and it clients there where yet they're what hitting can significant our not

for loan plans Like well new set the about addition per side, So representative I help of executing project side, early creating the digital feel important. And said the year. we're to going we're we're to customer good on be it up the interest we I on against it as and whether keep the coming loan which with servicing solutions, or you is we're on. had service the to do in price in service our digital tools enhance the and point-of-sale officer that that customer the know the also continuing the

the clients, there's from Our area that's focus spend them. lot of where of a

Operator

is next Please from SunTrust. Jeffrey Andrew question with proceed. Our

AndrewJeffrey

good Guys. Hi, morning.

have sales on of overlap? the I'm you've or successful enterprise question Anthony, that or from numbers digital. guess mentioned, process what's make this you I update is implementations is X servings sales what's the and think standpoint. which around X there my buying both those sure is that MSP an and thinking right, front? been customers frequency with an enterprise the Are overlap I you just any making

AnthonyJabbour

capabilities. new think we as newer bundling the that sales some Sure. I'd say of of the are you launched, we've

servicing well AIP look suite. that Pentagon you as digital, as included our for at if So example

earlier, to the that be benefits increase part they're our the at share the interest we're mentioned organization easily and coming integrated because seeing and able of get could on easily how our their So they of of really are with reason like the breadth market new I it. solutions fully clients the run implementable can

So to of MSP have more and what is sell continue the and bundled more more to into solutions I'd we continue as space, that. we'll part more expect as

AndrewJeffrey

year there Okay. as growth acceleration that and Is revenue sort the on/ inform the of of any implied goes

KirkLarsen

add before, Andrew the better is story said enterprise to would given revenue that any be for is what's in growth the some a teams level to of really I biggest is sales thing going And on client accelerated the say ramp. ignoring of when of job integration than related single selling from and the timing, strongest enterprise to That's and that an typical I period go the we as the is really really growth Andrew, what have ever concept, we are is year doing goes which one I been. as implementation ever driver live for implementations. enterprise, would Anthony us driving moment, across the the that businesses, of it's definition the the a think to

we're able I but we We're have. than bundle It's more a now than have. hence penetrate we're progression, so base been able to think solutions. the to better ever we ever it And doing better

AndrewJeffrey

just just share D&A, perhaps that's then more And color quarter second a perspective what's row to maybe really a one nice from growth. on Kirk. as market that a even Okay, driving in helpful, one little quick

AnthonyJabbour

Sure.

additional really the contributor key organization space. us terms our sales in to of in strong I that's the of cross-selling just been in mentioned for what Kirk a terms facilitating think in

KirkLarsen

Yes.

really think I that sales execution about is integration, all and it Andrew.

another is it quarter. good a --but So

to growth the of digits Second and look as opposed more I quarter the single above-trend in that belt would towards to think rest the business. digits our I growth year, I of low for mid-single as the look under

Operator

with Fargo. next is Our proceed. Bill Warmington Wells from Please question

BillWarmington

morning, Good everyone.

the you for origination side. question a So on

of can for sales How you wanted timeframe? You some a customers, Empower activity with talk in on. that know in of banks I terms it's are on progress trials with going talked new an and terms ask maybe think ten a update And Empower. ask but lot the about the you betas, longer that testing about cycle to of I top Empower about Now. with or penetrating

AnthonyJabbour

market to Well, ongoing our them but and years. Top your focus there's DNA works because XX, been many, rating that the of but like what approach on an largest But to solution we I'd many to longer we Top with ours would Sure. clients said answer has the say we've we've that sales the got can the get been obviously organization specifically help. not Bill, just servicing on I -- that's in question cycles our in entire XX say is really really focusing everything for the

not it could be the So origination grow then just if relationship AIVA it's the from and there.

if interest a correspondent think lending, is on an focus assurance the in Now you seeing it's we're Our Empower comes quality area space lenders of with some and that function really of completing that's growing as lending in loan obviously that top a it's correspondent well, in.

AIVA if now really help you look AIVA and process. so And can that what simplify it at can do,

one we're we're clients, is a equal what's of excited a that's and got and lot are plus it's got with these prospects excited innovations We're the LOS. now about three us what that them. who new integrating bringing in existing market So one to clients getting and

very interested think solution. in I our

KirkLarsen

the it's that the you lender which it's corresponding on to just correspondent And as one that think talked about in in adding even home one that Empower further extent get add we whether turning we with fact channel that if the really Bill, I've with or were to you you capabilities, is can capabilities foothold Citi equity well sell. gives deal, thing at whether a point. from about it's and that the a

on to done expand. retail good a grow So can one with you start start all it's and you channel the whether channel the place which equity home or or and conversation then can there. from channel of with the Empower, And start or you wholesale be correspondent really

BillWarmington

growth question piece. ask and wanted Got my follow-up loan XX% for year-over-year in That's which some I the to leads strong the guys that it. to is just And you particularly origination out called terms clients? new it of Is driven some clients? new Maybe much well. I get color just how expansion color there. existing being of as products some to is wanted by in there there

KirkLarsen

the Bill, driven, strong. That's by new That's performance several quarters last has where really the very there. That's driver driver the been the really been over clients.

really that's so the story. --that's And

Operator

George Our proceed. next question with is from KBW. Bose Please

UnidentifiedAnalyst

I and revenue Hey, on step with about growth up per of the see the quantify guys. the what When way the is and Boss. loan servicing versus is This think Tommy digital impact prices? on kind there of standard side, adopting any the clients service just we for to in your contract

KirkLarsen

when Sure, per loan on Tommy, for per of point revenue comment. just price the that's a clarity, to more in referring that really MSP. what we processing really the loan to refer that That's

to upon escalators the price that's on some So renewal. of Those specialty would servicing would I price products in digital incremental be the processing other others. other services overall a also basis. say and of additional that servicing for it's potentially or or would --those loan mitigation they're we as of relates of base like any price to different per be per and claims other but What are order processing. it the annual increases not price magnitude. incremental, it some Whether very the It's the the than MSP really loss loan

UnidentifiedAnalyst

something why? Is feedback like for of response necessary? solutions a or of up for choose their the still to there? kind to isn't kind this to are showcased there's that just as sort not what's that and it What's of not the adopt Okay it clients willingness and these pay

AnthonyJabbour

success a the not for trick it's question, the need resonating is exist. Tommy, it's with because Well, It's feels sure offering in like overwhelmingly filling such lifecycle I'm early doesn't if solution on a just that a our digital that market. we've so think, I sales got

you at they've if years the in or absolutely capabilities. specifically you and or now.. digital of -- the more versus think the yet imagine think I use if we more I mortgage And so of gap is the on ours clients And more I going resonating. more if mean will. It's was that So without banks, message a capabilities I sort hard of side do we'll said eight hard digital future filling. back you It's think it's digital a we're both there look I do world asked it, I to digital, apps myself to had

seeing are so that And our got very has that. clients mentioned mortgage rates. previously as The low feeling industry I've retention

maintain a the a all refi or things relationship new cycle through of can cycle. do and home so purchase you a that try And to

I our think clients we're agree seeing. I'm with think And I'm I I that continued and well. it's business. the results as in very like critical anticipating said, the pleased growth And

Operator

Our Ashish Please proceed. next from Bank. Sabadra with Deutsche question is

AshishSabadra

as pace pace the implementation the of on Congrats as solid well innovation. of

question tuck-in my So and was you organic done partnership. as as innovation well to sellers,

increase partnership forward As portfolio look tuck-in are you as the as for that offer you of there further well opportunities as acquisition products you can to customers? your

AnthonyJabbour

And for colleagues space. who I'm to internally think stride. we're my progress shoulders business we're excited candidly the innovation the looked that with mentioned to very is Kirk their obviously in build grateful the perspective. thought to also I I aspects And from making. and our surprised say side very continued look I'd on the in and it. into innovation sales than It's getting we and of I'm our I certainly amount we'd and what buy integrating of the year of created pleased first clients. delivering we more and put our more I'd say more as Well, servicing selling full within the integrated then with and an of

better imagine future we're the better looking think more to because innovation that getting just we're it. and at more build I building so will we And and I and the muscle

everything but how take factored to that lifecycle that look you integration you the always do really expect your what full want kind look but there's analyze We that oftentimes the of I product front. acquisition delivering, buying That's to that and is a at opportunity. you cost have but you look selling, into do, when into anytime product your So not in if not you is into into your important of implementation. and up tuck-in integrate at just and of support what's here, great a advantage it, full

a buying bunch never of them companies integrating just right either. the so And answer and not is

just So how we can market very from innovate, to we so easily. we how we're the bring thoughtful what that and being we about take quickly but solutions our they the not innovate, the clients remove friction

So, them value the increasing by margins ultimately their revenue, them again improving it keeping drives and for compliant.

AshishSabadra

very platform. new on away quick ramping Ditech. any had away that. on I initial quick loans question MSP that as wondering mortgage, was I some moving of was helpful. to And they That's servicing. are servicing, you residential a the just as update question And from your Thanks. any two maybe on feedback if of then on wondering sort often just

AnthonyJabbour

you Ditech one on only Sure, can a obviously I'll loans as I excited former the through you maybe very you'd comment and what family, the really on tranche update stage. have update very of we're But remaining that which close working one. We're we so that's clarity is we've MSP about. at got on far their in take critical And imagine. deemed question. this them. the with And with staying the obviously, them, we're can Ditech, vendor Kirk, to

KirkLarsen

Ashish, can first question>? the repeat

AshishSabadra

as feedback initial MSP any just on the often to platform? I no, as Yes, ramping

KirkLarsen

gone has any implementation the that feedback. specific I for think well, say I'd but

but it's think -- question, best expected. would the them ask It's going it as well, I to be progressing ongoing.

Operator

next Our with Please Blair. question Sheldon William from is proceed. Stephen

StephenSheldon

morning. Good

on as of us maybe the relative about from you've of new the products you to can been First, Servicing frame annual conference, that you new gotten frontrunner, how think the different of more other we contributor but as and you've some just X help AIVA, significance given would next the through how you've introducing, like analytics should today at financial clients the point-of-sale like we important of the this, all I'm the RAP X think the view platform the especially products products color guessing about your some the over Digital be AIP, be could feedback solution. talked but ones years?

AnthonyJabbour

was But drive with wasn't capability. we're the many my to colleagues from on at surprised Knight been clients to looked work Kirk very at client the them, bringing them. help to to revenue And What have and I'll they them hard them; the surprise met rewarding the that And lanes entire say, first was Black the great. and feedback their to market conference for take And capabilities relationship. our and candidly. timing. when they view conference, at from that I excited at find with half feedback of enable Knight their the I delivering the and take underestimated be it. for with and working let I expected, amount that really for help that, and of new, What really that. client anticipated I comment that overwhelming. It conference, a I the business. ways to trust was was they're great exciting me, is going and a them the the of mood really Black colleagues the my needless had in exciting was I

stride feel as we're like feel like we're to clients in Our my what full need and we colleagues and I accomplish? as well I said, stride full in

KirkLarsen

quicker, expect demonstrate. Stephen, revenue So say the clients. this, there's already from perspective, ways digital a ultimately is, And is this. contribute up think revenue then I another. faster five contribute two others, I a can which about from couple think I which and about we speed to clients, it's what eight will to will ramp One talked top more very a of than easy to of our would we've We've than servicing to sold perspective,

tremendous had we've there. success So

will, so we'll first. And that see that

that next would where XXX the I to the It's more will of one, to would in be just there's of past, then quicker would harder demonstrate and then expect some based demonstrate than the And as about AIVA up analytics. AIP difficult say that interest level up. others. Anthony's think talked I a ramp take I on

And no actually test so to what it many than to different end it other we're do, period, they is trial so speak so start doing At up buy a consumer that they try before using having get we're it. they you used products. the the of take drive, people

think a strategy. And terrific that so we that's

what we'll documents AIP almost And have been contribution servicing. all analytics time and talk solutions overall be can of lot stop process. think boundary It's interest, the platform in for forward no had and those. it three think the how say what is? of really when --AIVA that'll and AIVA it skilled incremental looked with and I a future but so From AIVA I realized sort bound where there's there. has has AIVA and five that, in can doesn't and a we and the and an I today then think origination as in others with to that skills go -- AIP more think RAP And have particular line that you into about in mean that growing skills fully keeps through with I starts that quarters, starts received. origination go like and I has

it going is expand grow. continue AIVA. we really going to universe to the there almost as so continue to large. no to do AIP, thing. It's what is It's boundary And and with to is can very same

two look will really certainly with have penetrate And base. continue MSP limited servicing the of we digital years so those to out I think boundaries and as and penetrate

And MSP and segment. think growth platforms it's on the if Empower plan platform's clients how it's they and in of strategy grow. overall solutions on And and growth new think you so our about themselves our it. loan all, data and then we MSP, analytics on to that incremental selling top both I It's and products

way will elements continue over build time growth are each to how these grow. just So incremental regular of part we I our think become and that individual

AnthonyJabbour

as that add If to well. I can

how at helping. our with where the There's its seeing it's in you lifecycle, where you as AIVA AIVA, it's not increase look significant a in If loan at driven we're is know revenue it's direct origination real sales. correlation any yet

to even So fully our AIVA's and there's live revenue in it's stride. contributing full though not company

it. They're choosing seeing as us decisions Empower go are clients Our doing it. on loan forward they system. origination into diligence They're factoring with on their

StephenSheldon

up then great, follow appreciate as And the origination That's really business. color. on the a

the a are that clients right think many potential below stabilize and given minimums, of limited seeing we now drag volumes to from industry the start in but two. year next overall should volumes how about mortgage talked contracted upside or You if kind grow of implementing and about and ramping

KirkLarsen

It's even it what you're further take a asking. than great and question, I'll

around uptick happens that were in volumes. to result and as will go an a refinance does that to what you or economic few look over exchange there. recession certainly being higher to written ultimately have? starts into what a result If We've the current result and last two more would points as refi of forward down situation on one a see either the comes We of of in what bordering That the forward recession enough three effect a the low refi. that's and years out back say and rates decline of potentially revenue

that overtime a couple really in back that the it prior would that so be that thing and revenue back up asked it as come is little certainly looked scenario. you would it noteworthy we recessions, where a And particular take back. would be just the I'll It a The so come question would years happen in there's other bit that instance. of quarter, all would that at in piece wouldn't likely over beyond pick up comes it

even Great in look a low If not a before recession what accelerates. refi is happens while Recession the of but are just past event that recessions so and for the is you rates at

heightened. with so other The foreclosures have happens is that people their mortgages thing and issues unfortunate unemployment are rises, more

for was that -- do years what off recession driven see you of looks the because for don't last volumes platforms you hasn't default prior see I our elevated like, talk recessions Now the were back been but last us is in think about that haven't are business to meaningful minimums. have and about. unique, are to talked But foreclosures of higher. to and it would And have enough level we go couple it's it if we specialty servicing something

so say also or second-order refi the back to pick another effect where actually And the us. effect of extent in could incremental there a that same revenue up There's pick of is up. I should foreclosures circumstance

situation. there's to But a been revenue do great up. economic a so the to last years when of actually that element because speak hasn't our really things would in what counter we've that been that cyclical And there business come incremental turn several is over

KirkLarsen

Yes. is Again, that It's we platform with market our if bankruptcy could significant with share, market share the and XX% our than on I market aware share for that MSP foreclosure greater our have of everyone about add MSP. currently. to it's

happen, can of turns the when and to point So we're well when none to going Kirk's for positioned that. cycle us predict that's

come now. feel well the positioned company as comes good very that it future doesn't right well. again And So about come, our where is very recession situated in or we're whether should confident the and for

Operator

Sachs. is Our next Schneider proceed. Jim question with from Please Goldman

JimSchneider

in Dun a Knight the might areas you those and terms from reflect morning. either you going & some synergies potential -- how Good now what sense be of taking or dimensions Thanks for a know and benefit from cross-selling clients forward? of product the DnB strategic of give -- between in might while, having level business Anthony, my that some interplay Black and question. a of a of can with of for involved Bradstreet, being us maybe

AnthonyJabbour

by Knight a Jim. really company, -- with We're Sure, and integration not Knight. DnB's an focus standalone Black is Black acquisition

a is opportunities There but what a time. accountability at lot very there am Certainly still that. great of being have the math of significant business, a a what future and overlapping focused significantly we agents as There the period am on any it in the in and lot we of We that's to work with by progress Dun going be. is analytics got ability and there think to well continue as actions; than space, would and Bradstreet. clients are aggressive to implemented take pleased more and team and focus who side, expect & time. I we restructured more there the recruited stage, many this be confident them. I am needed to being it's are to I critical, D&B, improve performance time a and to We period of times, done on I created very the our and a we've really team short together. in of I you'd goes very will at changes will the the number great I very lot very do organization, team anything that change the said, on a find closed client is made like on data am of very first I and space is do both short new in made done It's it So we working February. and confident say executive that here. the here is needs organizations, between a to of will is week

JimSchneider

be last in thing, over been you with Fair comments you. maybe last quarter? about very in uptick give level as of of below on far the but several would and Thank can what's us average update And the current how minimums an saw made the there's quarter the your originations then that's just you kind enough. happened are a maybe contractual just temporal originations given rates understand

AnthonyJabbour

XX% I What represent the at systems, that that origination below minimums processing are the clients for will say that revenue. or of our is loan

it's XX%; now XX%. was that quarter actually last So,

Operator

Glenn Oppenheimer. question is next Greene with from Please Our proceed.

GlennGreene

be in morning. actually is Knight's to question know to wanted going sharing plan? I could of expectations the you well you in ask to kind what's Anthony, game at share D&B big Black sort of two of of as given -- profitability point significant what economic sort Good interest Thanks. D&B, or be sort the or years you might some vision one are

KirkLarsen

don't actually be would well. performance. in is I Cannae on details business through more be on forward owner giving will are, plan today provided. those to will that will going talk financial future the certainly that who and and cost that we savings in a and quarters next I certainly what detail don't I -- don't than early I say think -- ourselves is things. to and as But will does they're we Glenn, forward, provide say going more Cannae week that's we believe even going those a updates details Holdings larger -- little would it's between

GlennGreene

growth number to initial for the components, a me. your the meaning couple just Okay helpful out expectations services what give expectations software to solutions piece Kirk, update current could it relative for LOS you of and year, on questions get the for then us just and were? their the Was D&A expectations the the to piece close

KirkLarsen

expectations changed. The haven't

I think about business servicing low -- and that slightly what be software was quarter last that the at last year's I origination growth. that have single be talked or below, would double-digit growth would high

GlennGreene

to convert then are finally still to to backlog And XX% just 'XX? of Okay. tracking you XX% in the

KirkLarsen

That's That's right. correct.

Operator

Our & next Kevin Zelman is Associates. proceed. Kaczmarek from with Please question

KevinKaczmarek

for my Thanks guys. Hey, taking question.

if more LERETA of the you clients or guys from processing On stick directly revenue get an or they feature tax tax that that are the you use it a mentioned. for platform? with to Do a add-on reason

AnthonyJabbour

integration of we're a think a-- the it. as it of part doing smaller work get of that the for revenue piece as We

our it's that perspective, revenue that's the but have not real pure meaningful and that in points a that pain we're from And of is reason. one client's they So solving on focused problems. the again regard,

with helping So we're along way, to a solve problem. them getting the but some revenue

KevinKaczmarek

Okay and in terms the broader I product capabilities. guess of

of share a you've retain point-of-sale, that in remaining of are trying servicing to you holes clients? getting fill AI, on the are from seen to on going to I the spent guess overall mentioned kind lot this really market revenue make but You you're sure and up at Where where you things speed the point? origination your that terms

AnthonyJabbour

we're or very to company about good of pain these And we're urgency. it's kinds organized innovations. with Whether after moving and of feel I how and gaping if thoughtful we're we're really clients the at Well, any sure our I'm are stage. and to pain with that there always urgency clients our this points have. the go major the opportunity, of holes not moving about each We're asking it makeup

thoughts So I to mind. anything But, wouldn't you say any Kirk, that do have jumps there on? is

KirkLarsen

little do that's bought know year agree that we as a what our of you would sliver could to solve nothing the we add to incrementally. them we help along a way Ernst we find a gaping clients from time Anthony I that there's sell sliver if Last of the that Q&A like would for capability will It's time exactly that say But Kevin. that, process mid-tier. to said. process where No. of us why help more things as the End was we to

Operator

to have question-and-answer over We session. the for Anthony call our to I back closing would reached like turn remarks.

Anthony Jabbour

Thank you.

on joining great Thank today As in to of for thank efforts. Black us for always, interest strong rest day. the And your the call exceptional and Enjoy your clients their colleagues our you partnerships. like their Knight I'd for our company. my for

Operator

conference. today's Thank you. This concludes

You may for thank participation. lines at this And your disconnect you your time.

Ed Ewing	Investor Relations
Anthony Jabbour	Chief Executive Officer
Kirk Larsen	Chief Financial Officer
Tien Tsin Huang	JPMorgan
Jason Deleeuw	Piper Jaffray
John Campbell	Stephens Inc.
Andrew Jeffrey	SunTrust
Bill Warmington	Wells Fargo
Ashish Sabadra	Deutsche Bank
Stephen Sheldon	William Blair
Jim Schneider	Goldman Sachs
Kevin Kaczmarek	Zelman & Associates

Black Knight (BKI) 1 May 192019 Q1 Earnings call transcript