CLGX - Earnings call transcript Q3 2017

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Operator

Good morning, and welcome to the CoreLogic Third Quarter 2017 Conference Call. [Operator Instructions] Please note, this event is being recorded. I would now like to turn the call over to Dan Smith with Investor Relations. Please go ahead.

Dan Smith

Thank you, and good morning. presentation for call XXXX. the investor our we our results financial third to and where conference present Welcome quarter of

today President CFO, CoreLogic's will Frank Speaking and Martell and Jim CEO, Balas. be

let me few Before we make begin, important a points.

presentation posted details on includes we've results First, which our financial on additional slide our website. our

plans, meaning acquisition our that securities laws, federal growth during note may expected please our industry the and presentation, we expectations and make conditions. statements of concerning performance forward-looking strategies and Second, today's statements and business operational within outlook the regarding including

known All cause of these and materially the statements unknown to results and are from could subject that statements. described in to forward-looking uncertainties differ those risks actual

filings, and including Form most report concerning on XX-Qs. annual subsequent the further please and For details SEC these recent XX-K risks our uncertainties, refer to

Our statements on forward-looking to to we do currently no any intend us for update reason. and available duty statements and undertake based not these information are

Additionally, these in be non-GAAP today's to included appendix presentation contains And should the A to financial equivalent comparisons third a results today's periods of measures basis, unless in year-over-year quarter their non-GAAP quarter reconciliation prior to is the of presentation. on are is GAAP measures. XXXX. financial identified, to specifically understood financial that measures that third of reference

me at let limit please now of end the the Martell. questions our follow-up. yourself Thanks. call CEO, additional And Frank Finally, to time take one brief question President a We'll as permits. and with introduce

Frank Martell

with our operating will of well revenue trends you, our financial capital return. off call. relevant for comments cover as QX and will third structure, guidance. targets updates share recap mix, joining Good quarter and market provide as Thank margins today earnings everyone. as I performance, growth trends, on third capital on our you financial well specific repurchase Thank results XXXX including lead Jim as quarter Dan. morning, a

management estimated performance leadership building and CoreLogic in to enhancing Consistent were delivered our and out offset quarter half and workflow two, X% results operating insurance building year, our one, down owners. at Property quarter earnings another underwriting of of last technology returning four, the the margins first insurance impact and process the conclude exceptional call. the footprint; risk sector, and an our growth the financial solutions of our in Intelligence, Total end market US quarter. public upper with mortgage capabilities; that in unit solution and compliance organic ranges through market finally, the for operating as revenues three, capital on, third with We optimization; Q&A. guidance will expanding leverage third XX% X%, provided to us focused were the spatial decline we our somewhat sets; of and on our helped Jim Financially, volumes.

operations. well We spatial seven and underpinned positive quarters. operations This pricing, international organic in have as growth and insurance, now our solutions mortgage gains, been solid underlying generated innovation has growth consecutive in organic by as development growth core product trend share for

stage residential to us US and transformative of the represents providing our years strategic sustainable property US in in purchase-driven boom pattern a leverage As roughly a and as critical the its operating the and Today, growth we in the The to sets consummated information I've and five transitioning trillion be challenging insights. progressively the of largest consumers more clients is force ecosystem of debt partner whole. believe and US and mass annually, near-term, is in mortgage in transactions world's outstanding the with end ahead. news of the and the in for volumes a for one industry both a cycle, mentioned the past, CoreLogic predictable for although market years, last refinancing mortgage good the XX which millions provides over mortgage property

executing build US continuing a with lender XXXX. mortgage of unit team the important and US virtually underwritten now initiative in leading annually of build out in content, our strategic market past significantly months, mortgage growth every over revenue unmatched our insights have US and to three focus the client resulted on mortgage New four Zealand. in is advantages, and insight in CoreLogic our protection analytics solutions capabilities and provider expand further outpacing leadership and loans valuation touch to we fuel out Australia Our our the both Our To has is data US every volumes position penetration, workflow strategic property and and major servicer already connectivity. scale CoreLogic since been XX our an valuation. innovation

appraisal manage Over operational profit us and allow appraisal, lenders platform of potential flow achieve and the cost we arena appraisal small drive in the valuation management our margins business goal to it used are building significant Mercury provide FNC software and XX% line, that strategy serves valuation of Network. inspection on With now synergies, platform-based our Mercury unmatched the growing our US. Mercury future offerings, mobile analytics property is content, and innovating technology revenues and foundational is best-in-class collateral provide major These generation. a platform our transform we platform and professionals. to year, top efforts going lenders In continue to focused acquisition build these market. our the appraisal-related lenders. medium-sized and valuation-related over operation, total to which a cash with and diversifying our solutions. our assets companies platforms a important revenue for next With our of in scaled high-margin further content, their companies completed the with primarily and/or in operations. workflow company growth the by space years, and potential capabilities out our to solutions platform provides multibillion-dollar and help a revenues Together, title to complements transform element we analytics support that this represents valuation leading expand solutions mortgage This the forward. to fast third approaching quarter, the CoreLogic XX,XXX to US and valuation to footprint and management several digital XXX opportunities expect

During at new of we second we're quarters also year, progress third to in the appraisal in pursuing diversifying the services continued we quarter, make an same process We're solid onboarding active base. secured this prospects. time, and client of and the relative of pipeline to the clients

management as future. CoreLogic up of way is will and in well points business margins of by analytical our scale, race a well appraisal-related transform operational this our advantages real improve management as poised a the residential revenue, by to remains assets productivity estate's The to capabilities the As prove valued. as primarily in businesses, and XXX performance as the and should I our believe transformation. enhancements strong discussed in for property the top-line our very year, are that in quarter The enable last our third compared be objective continue following our analytic the basis appraisal significant regard, in platform margins In quarter, team of share technology, to market legacy data and currently with total growth clients. last the call, content-related scaling fueled operations. platform, diversification continued appraisal our valuation improved US We our offset on anticipated to portion diversification last from to

energy, about collectively As be and to operations US represent I've half ultimately as one Today, our international, opportunity. will public the of sector. we revenues. horizon, presence mortgage grow our significant contribute spatial, mortgage core operations such in represents said we this a areas our closer revenues expect endeavor the and as past, Over our strategic US to our two-thirds in our multi-year a insurance, growth planning infrastructure long-term of

efficient management on cost a adjusted we was The third integrated these evident and focus our QX remain run-rate operational reduce last in also improvements. more mix, favorable new reducing are quarter XX% by Regarding results. and well to margin cost from $XX We're and were lines, facilities, XX%, relentless cost year. XXXX Along up benefiting in pricing, EBITDA at benefits making of track adoption from the least margins. SG&A technologies. other by on as consolidating as becoming million revenue

results progress plus margins quarter a platform. our build-out normalized mortgage US toward and goal EBITDA of the we solutions of making to point adjusted XX% achieving we're market based for on the accounting Third XXXX ongoing as valuation our exit

and relentless focus operational of have Our model. on business unique building generative resulted and cash the scaled solutions in durable a effectiveness creation and

technology, information our our long-term we build this investments to sustainable and in record capabilities. have continue as compliance investors In solutions leadership core As an well of track our connection, important successfully enhancing established innovation, operations. market our reinvesting expanding as in make know, to security we

the expanding our has As capture advancement of in we're and opportunities has and benefits and the tools invested accelerated, pace emerging technology imagery. year, machine of capabilities. as CoreLogic This to learning, areas voice such focus

X% services $XXX Last shareholders. repurchased we've reinvesting year, of million addition we our to In our shares people, also our cash returned for to substantial free and outstanding of flow in levels X million. products, or

a free insights. continuous our high-performing believe for who delivering count very or transforming both in strong So XX% far unique call insights in additional our we focused to the are turn share our XXXX, clients of participants of operational strategic XXXX, discuss results. In decisions successful set conclusion, our result this repurchase XX their make year, through net continued over of to management to in cash shares. Jim, housing as execution continued outstanding focused ecosystem execution success and and a ongoing our against X%. to in thank X risk set out our I is revenue, on monitoring. by strong that property leader a million period a we this share on returned results of so We back I'll has performance our reduction stage program. Since CoreLogic margin reducing XXXX. financial XXXX shareholders and support. flow employees, our operationally the translates in our to delivered our for global imperatives areas and a want of have identification, And owners will This an CoreLogic direct I allow and shares, financially. which billion These time underwriting and all remain laser far better another million an prospect $X.X close the we share have over now, bought in count into

Jim Balas

financial Thanks, Today update you quarter and our good will capital structure discuss guidance. everyone. I and Frank, third morning, results, on

Frank results both quarter CoreLogic an perspective. achieved operational from mentioned, in third and the financial very As strong

two, flow, cash year, leverage operating and highlights benefits, drove and us Over US continue significantly pricing the adjusted unit repurchase our one, significant million mortgage organic high to by financial growth months five, scale productivity products; six, levels run Network the share shareholders. achieving of facility. generated the included, benefits; the nine free continued three, trends, shares; finally, and capital gains, of Notable closing SG&A significantly we acquisition; our refinancing outperformed Mercury the and this lowered targeted of trends XXXX and third allowing the cost first for company's of quarter rate to credit four, return cost supported expansion; and upsizing reduction and X to common volume margin EBITDA the quarter new of

period, $XXX in million totaled second and the million $XXX XXXX XXXX. in same revenues quarter million of up $XXX compared from quarter the Third with

revenues X% up were quarter sequentially. Third

helped both US in by period. from cost benefits pricing continuing of previously programs. market income the driven totaled of collectively lower cost for legal mortgage $XXX revenues $XX insurance, market the productivity as discussed including RMW volumes, the The the reduced of million in market Operating During estimated mortgage income decline unfavorable than XX% outperformance, vendor the and US the XX% decline estimated market valuation settlement solutions XXXX and growth partially upsides related approximately declined well partially of client. in approximately offset primarily origination volumes XX% million, the an to impact was as the X% gains the segments ongoing operating planned impact and $XX as quarter, XX% year-over-year million an XXX higher products a impact management were in volumes. attributable last decline from management X% appraisal third revenues, below more offset PI totaling operations revenues compared discussed was XX% million share and totaled of solutions by to more decline points to attributable margin as the a basis from revenues of year. cost mortgage same and and revenue offset offset with that revenues settlement contributions our and pricing reporting international diversification quarter, mortgage by than volumes. $XXX of benefits Operating new product earlier lower US new spatial legal significant to

$XX income attributable decline market benefits were with productivity compared same EPS volumes totaled second which for the EBITDA and million, EBITDA PI by approximately XXXX the adjusted well margins. RMW higher margins $X.XX $XX of operations in totaled third The mortgage in the as in XX% XXX and The primarily to adjusted product program the $XXX was period net XX%, outperformance, I basis quarter mortgage the year. adjusted in US from impacts totaled prior-year pricing and down continuing with adjusted Adjusted continuing $XX to XX% unit down higher costs, growth segment the XXXX costs as period. and XX% from significantly quarter in largely $XXX by was year-over-year. international from EBITDA settlement in solutions-related XXXX. from resulted EBITDA initiatives levels, same offset US valuation mortgage lower in basis origination rose quarter offset revenue to margin partially and principally market legal noted decrease volumes. and cost $XX Third impacts XXXX. with prior-year margin EPS more million of EBITDA more operations compared and this was from RMW from than XXX cost EBITDA discussed compared of XXXX, modest fueled of $X.XX margin and was cost operating up adjusted offset million, million totaled XX%, XX%, EBITDA interest $XXX growth decline quarter points in year-over-year up new XX% which offset totaled productivity solutions-related mortgage management down unit approximately Diluted higher $X.XX spatial valuation the previously Adjusted million insurance, unit points mix benefits. volumes. compared as previously. third $X.XX lower as primarily than leverage PI year. operations, in the lower million Adjusted the estimated in million operating from volumes prior

million EBITDA. cash $XXX XXXX, which Finally, generate to flow cash we we XX rate levels basis, flow free to On months free flow. of strong a conversion continue September represented a cash able for were in remarks our will Year-to-date, with discussion free shares strong common outlook to trailing repurchase capital of of and totaled XX, QX, as of million, XX% Due or adjusted X million common prepared of close repurchase our on fourth structure, our X% a outstanding shares. share quarter million. I we have plans. $XXX my repurchased X our our today

facility and loan $XXX provide and will financial recently going credit we the In secured August terms flexibility amended to our borrowing structure, senior months extends of capacity The capital more XXXX of facility term the amended which than by forward. million. expands XX by capacity our additional

fund remain capital line return progressively capital and shares, levels repurchase common our disciplined allocation long-term in to the of M&A Our targets. reinvestment, pursue priorities through leverage with our opportunistic our reduce to overall debt

guidance. financial increased full quarter range range a and guidance our $XXX results implying market to approximately for our to have EBITDA current to Based the trends Regarding full of of XXXX, $XXX on $XXX million, million adjusted bottom end of quarter third year end view million our of year reflect million. $XXX volumes, and we a fourth the growth of cost strong productivity likely

more full million We to by year XX% shares. for than share are X.XX our target also raising repurchases

conditions. past reflects mortgage XXXX now to even execute to over Thanks market and demonstrate strength the strongly our To financial well results in model. in year. back with and deliver of another continue consistent very our results delivered the operating US and time financial for Q&A. outperform turn positioned strong over durable CoreLogic for operator over tactical the this strategic outperformance is the your plan years market to outstanding up, CoreLogic's results I plans sum strategic and adverse balance actual today. several year-to-date are the it believe we strong third to call the This quarter. performance capabilities will in and Our business against of our I the

Operator

come Darrin first The Instructions] with [Operator question from Peller will Barclays.

Darrin Peller

quick comment guidance. Just again on a

million push improvement the And the from think also upside you the could given the organic EBITDA the just at if anything XXX is it's now. there to and rates, is back market -- on just in full Is guide, Mercury contribution million million Just mean, on Mercury half Mercury the increase year I the from around implied the where see and last quarter? as versus tenure -- the do coming, well? $XXX from all? touch lower-than-expected if about on, I XXX of potentially you on mortgage the areas that Or guidance

Jim Balas

Thanks, Darrin.

in guidance, embedded So the last was in terms the guidance when updated quarter. of we Mercury

So nothing there. new

the an now, terms have outlook. that range still of providing we're we In

As still the you back last quarter. quarter going be thought from we on the year. were to the the more recall That the expecting into market what little but improved to It's amount a going of in probably than it's half challenging headwinds that more call, -- not a has market bit fourth be the headwinds we second significant of in call, changed.

Darrin Peller

you should market's down? know new right. add-ons. that guys I over diversification it for the of it's relatively a than for But current some All more VSG a in confidence expected impactful trend Obviously, the will -- guess And or 'XX some have seeing? from flat offset we we're was I the little client I growth area quarter. think only this mentioned helpful. into for slightly headwinds second. That's onboardings then How if just client

Frank Martell

think couple look, we've pleased how team -- is focused the is up what super been the in which this lot really, VSG really and is I we're are Darrin, last with a Frank. Hey, going quarters Yes, the on. margins

I a I think strong, of And the now. is said. are I as slew onboarding clients think pipeline we

think the similar it's last to I quarter. So commentary

the really attrition. offset substantially expect We to

it So and VSG for diversification be terrific we related in an if that, business. the the base result flat I well, a margin excited the -- similarly, of think year think The margin market's go and client, to platform we as high attrition is as should in higher client And we'll and given legacy pay profile also we understand some serve produce us AMC I with as the the flat, us perspective. holding would offset we're has having the combination a would next from market FNC a forward. to we're I very about though say Mercury platform really going synergies a of lot dividends which today.

of is, encouraging story. portion and a introduction coming the the the think, of our in side Data a I VSG & So the significant solutions valuation Analytics platform from very development

Darrin Peller

helpful. That's right. All

then to you've the a environment or is that get queue. the and back headwinds. mid- Just growth I story were market in seeing does market last growth more we're environment in XXXX, it X-ish been talk profile? think an -- seen higher in the of to bit what growth, VSG we question, we level, guys actually can in high look, and forecasts about single-digit where growth, level turn organic Clearly, you're when the little show I'll what you even percent now. Frank, originations have market type I constant for in to mean, organic But potential the there low single-digits, If

Frank Martell

the quarters, and in of encouraging the look I drivers. distributed the been Yes, for quarter profile, couple evenly for was, pretty underneath it's the you think at really terms growth of if Darrin, thing last

product introduction, had So you've gains. had you've you've had share pricing,

terms a to be number of of the in I organic So like horses growth profile. riding

planned. us one for I has of think those potential currently each can if on areas we execute upside we opportunity have what

spending the think turbulence years had, So X% market you I and major is look year at the we're pricing of think really, X% servicers and pretty that. for if some we're patterns well the the at lenders I many forward. go than the in we've growth as look pleased bode about getting and the and profile year-to-date many, that you And pricing, more this so at of solid we pretty progressively should to

which because scale I share should info for as are our a -- investing major critical player, base. we're increasingly things think the we in client gains like a continue are compliance, security

And looking and really safe hands, so a through for our of clients provide I that are scale. think our pair we

So things like share improve. gain also should

a riding range X% a we're go to move higher into can't in I And I lot we of think as I that year. horses. delivering forward, a of terms up reason see don't X% we why we're that this So think

Operator

be SunTrust. will from question next with Oscar Turner The

Oscar Turner

on you first there also I'm new you're wondering VSG. So analytics outs be on any it solution specific content, call capabilities? just customer question's valuation whether whether or the on Any the technology, platforms? can color provide getting feedback

Frank Martell

the Hi, Oscar, this Appreciate is question. Frank.

general, getting think, we're very I in positive client feedback.

think so management I we're appraisal in sell of dialog. piece, kind that a in mode, the obviously, we're

I business, terms good think the good in margins. of platform growth,

Mercury transformation, data -- leverage, around and assets things and the and reputation that's opportunity to good I got very things the can that terms methodologies high going like platform. array and broad both a in would of for still constituencies say our our reputation, FNC alternative developing. I continually We're forward the valuation have team so a positive. that's the Mercury talking in of analytical think real market, team

more to lot digital, a pent-up that work going and now. fully But of still for experience of quicker So lot have is story around demand written. we that's valuation. of where change a a be a And right obviously, there's

obviously, And days, really early but that. wants everybody again, so

challenge our is to So able deliver to it. be

Oscar Turner

the VSG. then margin at And just on side

margin it margin for was improvement then margin you segment? remaining? is still have there And How do of XX% upside target, think a I basis think year-over-year. mentioned guys XXX you points that much I

Frank Martell

been mean, So level of couple that last what things quarter time. margin story, this in quarters. talking one some the about I for and the last great this of quite we're we've think I validates quarter is, pushing about really it

lifting feel cetera. we're heavy operational like from lot track panel there. standpoint, right A we efficiency, of on So around utilization, that et

of in margin So to do we're we're in side trying terms on what of VSG. terms right track on the

the positive think an margin. the recently inherently I side platform which the up has business, the of been much scaling higher development of is

mentioned the continue So the bigger, you'll gets the to as percentage through in efficiency. supportive see that favorable the as margin be addition mix and - XX% I operational mix total, of kind that mix to of climb

So we're some track potential. I think right with on good

Operator

next The question from Baird. ahead. Please go with Meuler be will Jeff

Jeff Meuler

I one in the I guess follow-up margins also utilization Or even come? this what on last is, on up benefit the the a a on And that you Or the is I'm VSG down margins. up a a market? of on driving Are shift? portion guess staff just it? mix the AMC is are wondering

Frank Martell

side. we think have that less of in of actually of we But we And the segment question, biggest first and your on maybe - heavier part that or the kind a are second biggest that's It's believe think point little and pricing your both contributing terms type part the through the more have of thing. significantly combination the Jeff, more terms Yes, the question, improvement bit more coming AMC of platform your in staff had. equal, in the AMC - I I segment of we've XXX so segments, also, even panel to a fundamentally, industry. of basis your

utilization and the efficiency. people is the that full-time of panel group important So of great terms in driving of a employee panel,

there. think a benefit getting I we're So

panels you've now. together, I up is, landscape think efficiency I is relative other those companies And bringing think the been together. bringing our so you’re obviously the thing

through we're bits So working the of last integration the there.

from see seeing. some we as which efficiency some are So naturally, - you well should that

Jeff Meuler

there And things in throw for is out the the what is terms mortgage US any rate that insurance, combined bucket international, on organic on that organic is break then So on adjusted of versus you for adjusted non-US spatial, mortgage what growth it to organically other it basis? the way growth, the businesses?

Jim Balas

been past data, continuing on calls, On think grow the in the to and we've insurance digits. international upper they've said I spatial single

Jeff Meuler

mortgage it them? anything but in - Or the then signaling one a potential is saying of acquisition know in to you just remarks. of you near-term those And markets? I other been in for prepared non-US a rates while, the this growth included this XX% going you've time. Are The your in Thanks. mix of between the terms delta target over

Frank Martell

period a towards an time. of tracking No, We - strongly play. We opportunistic is about talked that that's really VSG some for pretty target. been consistent were strategy

So we little added already mortgage the in to VSG, we - bit are the a but it US, evident. - there adds it's centricity think benefits more

So still we we to remarks, that strategic US XX%. consumer largest the if perspective, look of market, want the my it a get prepared planning a you from and mix perspective still, as mortgage to is about in property said But I at data.

important scale lot invest we position leadership So us have. good cash in and leader the to basic the play to flow to of a and is provide make it be to a in we that where money space allow

that we've seen So provides bigger But company in or non-mortgage, gets as that's an important it to XX% the that the post-recession. having offset so. to cyclicality said certainly keep think that, I

Operator

Deleeuw from Jason go Jaffray. come with Next ahead. will Please question Piper

Jason Deleeuw

try shorten Where for stand right Just you update on times. now? And effort lenders? I days, to that the the an go looking it's to guess to appraisal market is think of the but that do from appraisal still to does a win you business how differentiator early as important

Frank Martell

Yes.

I I'd progress. So good Jason, think we're I that on - say, making making we're think question,

you've significantly think experiences in automation But the get and mobility, efficiency to is probably, in like as mobility, speaking. mentioned things digital leading in I cycle looking ways because a at using I across already out a and transformative the and broadly I control think of basic alignment terms remarks, what our able earlier, improve we my times, mentioned we're to in I position is industry think terms participants. we got As can of what

that, think a in aggregate, But pack, kind opportunity so. I far truly lot our think So the a truly of clients. discussion of but the lot of quickest with be and lot to of around so we're digital a transformative, we investment of the certainly

investing can with solutions. We certainly forward. as go But players have we we're this, think work to we key transformative and their workflow around behind more we the get

Jason Deleeuw

part And the pricing the on And to we PI versus to segment and then pricing which parse story. expect segment? can we the anyway gains RMW just a of the CoreLogic of that become kind can on seems the like, it think out continue about for has how benefits? pricing question I It guess,

Jim Balas

Sure.

just part two it's becoming we get pretty still On do part early last in in days. continue expect the of the in price of we have our to the where long-term, segments And We're first, the terms overall. it's gotten to because strategy in And between future. of price. that's balanced terms the

are We have a lot multi-year. of contracts that

So to as they more time. take that's renew, going

So to a we expect price. nutshell, in get future yes,

Operator

question from Blair. will be Dobell next with William Brandon The

Brandon Dobell

cash conversion, should two, just or even conversion expect kinds year numbers. we range? cash VSG First, One, XX% we that works? in those XX%, percentage as free given free think next in of up should still little VSG how Or drift growth, kind quick out a about of things, flow looking that as the bit recovers

Frank Martell

from assets' First cash really of a free all, I think flow percentage highly. the VSG perspective

there. dollars on focused we're think I So

years We - - I flow the look, We solid on great think XX% and I - to done little for free - done has many job team, have rock really, team Jim to now. number bit. ebb been a flow. a and have cash a the think entire XX% XX%

models. end top think going range to to the that that a not to do that's - no that this of stick continue at your I close to a in point, want point reason we're is that number to range. of But I in better obviously. think see this kind We range. at good I

Brandon Dobell

digital who And view two share the buyer you seems top from eventual Frank, to the maybe ends your maybe How of a would to or view the mortgage? have products you get it that you or how of it's or of changes about point risks book think out guys press from just see flesh point of these is. a guys wallet of your the you be for in then the lot priced mortgage opportunities product digital which days. getting that whether point to a have view, remarks mentioned couple

Frank Martell

investment. digital think depending you're a aggregate, requires opportunity. term tremendous to. - a is in digital I who is a defined Look, mortgage widely talking It's on It the

there are I reality through is, consumption. digital applications think through many of the distribution,

stuff. that You APIs, talk of about kind

well, areas. playing to with in people, nobody as partner those partnering everything So because can you've We're we're smart do got all themselves.

about I And and and to think then advantage the we see of effective which plays I without digital the content. is to for me consumption the nothing - kind think you're going bring to us. the the content, our as as it's content that distribution of the distribution because digital really really, lead-in

drones on. We've but with what lot that's we're voice. area and a not got in tremendously where can So classically is the modeling done imagery focused imagery drone necessarily and defined digital, really going exciting. on mobility, through It's be

everything. by in So those be trying to where all focus the we're working to chase that highest and on get think areas. that's need is to to distracted I going not too impact And we something

Brandon Dobell

even of more their you of the market purchase? larger out business it? aggressive guess of banks that of transitions kind have the this Do out, to starting see last about especially market longer on or And money think as and I bottomed years Do lot it's the based retail your to of or would in, the to impact then you reasons two, the in answer mortgage the them out. And doing maybe center you flattened banks, stalled seeded to a of have to see a cohort lenders seems how not what do institutions, - be? get share have of share kind variety kind for financial than seems that, it three

Frank Martell

driven a depository stronger least a have the purchase - a make institutions in feeling at is, cycle, My share. traditionally,

difference the originators, to stay. very I and seen you've think by - high-quality, is significant It innovative those they now to remains got some lower tier players the non-depository be of mid here what do. they're out there, really long-established

we as towards go share players. I the depository my think forward rebalancing kind a of is guess is definitely bit

Operator

of question ahead. Please next Our go from is Greene Glenn Oppenheimer.

Glenn Greene

quantify I unit businesses? relates what across the you to and as us guess, drag help question. maybe first the the two and profit revenue the directionally decline Could it maybe XX%

Jim Balas

like million. then was the us And overall was up you The $XX market a the hit revenue, simple it XX%, market organic down on bridge some some the And Overall, miscellaneous a for to offset items basis. have about point call then about stuff number a X%. for if net portion for for you growth on accounting and of down M&A that - wind X%. last do impact,

Glenn Greene

hit million XX% VSG? was in And VSG in balance of $XX decline, the RMW? roughly much how Or revenue that - say, let's split and was that,

Jim Balas

little was would VSG, bit It in call XX%-XX%, I know, it don't XX%-XX%. more I like, say, a

Frank Martell

that things, the exposure, the a clients. not obviously, of primarily it's exposure has phenomenon market its Glenn, to One broad is, VSG got too

of bit little impact a there's well So diversification a there. as

Glenn Greene

of was that to your and sort in wins the and highlighted kind is - second drag. converted share client in client you gotten VSG I benefit in still of question. through of you've from the they And Or yet? Yes, don't I market of come know terms market the really to my your trying that versus think was impact quarter? just through sort any sort that of if next haven't

Frank Martell

No. them said. onboarding as I We're

prospective. it's be impact progressively more So pronounced will The prospectively.

year, the kind this adding thought seeing And we we'd we'd clients of we see. diversification we're So of see. thought the we're kind

pronounced was more the you'll if a think normal longer see tremendous bit look clients look, this I the market, benefit So in We opinion. a a just year. than from segment, additional tough, in my mean, I I'd I say just cycle a third quarter next But from RMW mean, is you also, result line. Glenn, although much of the perspective, at a onboarding my product said the

the as really look and that performance year-over-year team well team control. share it's and mean, you VSG at team the I a gain I profile they the the think terms and and by really, margins pricing, what real standout If that of through in could

good mortgage decline how the performed and it pretty despite refi. operation the of feel we tough about the So

Glenn Greene

as obviously, sharp better terms context the not and the it mixed sort LandSafe. of thinking in right And now? of given and expansion. them, certainly been what this and sort of in And forward of of the efficiencies a is then there's a grows? like hopefully few going just on of expansion related margins if of margin terms out a RELS VSG revenue of your face questions as margin sort in difficult As improving the number But the in integrating to and revenue sustainable, what sort is seen trajectory we've long-term decline, things of sounded flattens market it VSG really a

Frank Martell

kind especially of on we've I couple fixate think, darn - pretty mean landscape. last VSG. But look it the you quarter good and at - if I calls, look, VSG today, Yes, to of context third tended produced of right on a the the it's really, competitive - results. very

generating and XXs. we for the VSG flow margins a a are content substantial that's We bit obviously, talked past, be a cash right perspective. involved. a and business from a think client overall into there's data it's - And But we've margins as perspective now, about a us push in - up XX% can and I going to the there strong we little of business from a about think the seasonality

be added. other benefits will financial So many benefits there're and non-financial indirect

So team how very with pleased VSG that I'm has driven business. the we're -

Operator

go question will with ahead. be The Campbell from John Please Stephens Inc. next

Hayden Blair

Blair you that maybe there maybe there realizing for that? million of just been the guys already. of the on XQ? year? But answered any have for wondering Or than you the any finishing for lower is expected I'm portion the Campbell. $XX this an end portion Is John questions of were of that Hayden savings earlier is It's have guys finished implied guidance Most of my expecting raising cost that of of

Frank Martell

and actions recall, second the the No, so in essentially what the to that's of pretty a start - then continuation. we - occur the benefits the been bulk did And if expected quarter, of plan you which we took in realization and quarter, we on of the it's first expected.

pouring So second, the and continue we fourth that's the quarter. through expect third, into been to that

Hayden Blair

stock years stocks then looking at about five your here, out the the chart, And for of term share or doubled over the and or five basically have year. this guidance five looking so, talked longer - past there the years. pretty you ten your significant upped or repurchase past But kind guys you over

return is then to something steady is secondary greater you so - that And repurchase at your element of going to may a or now forward, where activity? like in strategy this be kind of be it or of a moving will take going capital be share and Or are maybe tertiary repos position a a share a that? point M&A continuation

Jim Balas

fronts. the an to where opportunistic think shares current than share be they we're always, in As opportunistic is to opportunity, on how If all the on is fronts all going but we're then greater going the we value trading on we repo capital. remain allocate are

Operator

Associates. question Kevin Please next from with be The will & go Kaczmarek Zelman ahead.

Kevin Kaczmarek

with can delayed mean, some guys thought Could as in estate your in for the might have see real you exposure if saw originations revenue? bump you of a within a weather Texas any some We this and we a sense driven we volume results impact, as get I Florida bump XQ? to - for volumes Do see affected that quarter. how of XQ? bit companies have especially and mortgage

Jim Balas

but activity had pretty required was a the of quarter in of we We perspective, an on take we're side. charges little it from event get a bit third pick little to the But bit accounting when up So revenue did occurs. the also modest.

a results So the modest third pretty the it's on impact quarter. from

Kevin Kaczmarek

that won I occasionally that And and to on come contracts noticed their had the some lumpy contract guys you valuation have FHA one you in sense this? lumpy with could perform Or you guidance a those would solutions. this Can workflow this be realize of I give a of revenue? and guys already? us bump of the line. size contracts up off of Is

Frank Martell

business a - with have in - - the contractual we has FHA. next couple what quarter have related third that you're But That do speak some - which there second now, Yes, get we we because services - to year, are revenue. we're to into growth lumpiness some wins, don't that fourth of we as Right last is quarter into referring contracts will we it the project-related as Obviously, an in in good kick into we of beginning sizable. some out - in general, of really a Kevin, not business have not specific of obligations. what the of call, called advisory that and kind we and do that period but going quarter occurred. the

Kevin Kaczmarek

lastly, like? looks you can I side? M&A guess And the the on some give you're at what what color pipeline on And looking us

Frank Martell

capital my growth allocation, we've point and and of really really, the priority first profile M&A from our Look, perspective, to business. organic on the Jim's in been efficiency reinvest on disciplined to the is

tackle, crazy know, out you It's of the terms to in what M&A. we very disciplined We a pipeline Mercury at and want do will Secondly, be as we look consummated there. we deal. just

consistent to of So and share content, intend disciplined we'll But repurchase, we the and in us, continue there. And things out capabilities, focus things mostly will been content our terms to there look are accretive connectivity just approach and capital. of in be to remain for consistent are there. is again, that returning our for on we then have we terms

we will focused to a go we we continue that return forward. do capital and as company, So are

Operator

will George Please with KBW. from next question Bose be ahead. go The

Unidentified Analyst

on This is for Bose. Tommy

up? client about that And any see same other wrapping wanted clients are guys diversification to follow-up approach? taking thinking large the few diversification there on you that indications have a talked any you large that times. the of When the do of Just guys are effects

Frank Martell

to more operations. captive our LandSafe, is a of this appraisal situation. Tom, relates which really acquisition and It So of RELS were

So you XXX% two represented that had by revenue. there the definition, clients of

of perspective. that from So it's kind unusual

acquiring believe we going which the to use really So services that be our and is other in diversification really top-notch. the market lenders just to want

the kind progressive. it's of just So

if when to benefits then you large. think, from ends, XXXX in your of continuing that material adequately. This be, The is it out I have is you bringing will the can lenders number I pipeline that end, larger never new diversification on and We're of and there point to mean. progressively look, does the clients we thereafter. the know kind So of large, what address

Unidentified Analyst

do where a of the the of the kind guys they of are differ similar already increases guys that price and that kind have Mercury, you are Or some getting through small contract there? multi-year sort built are clients you it's had? And of naturally setup mid-sized larger from and clients in contract

Jim Balas

They're a what we'll house. evaluate have is going opportunity future we probably with to that side FNC of the Price forward. similar the

Unidentified Analyst

And margin then that between Intelligence on exit that of XXXX just quickly Property guys RMW? the have mentioned, you and XXs EBITDA does breakdown sort how

Jim Balas

Should at balanced at the this as between two, be fairly they're stage. you similar look pretty today, margins the

tilt heavily towards So going one I don't to or think it's way other. the

So I would just balanced. assume pretty

Unidentified Analyst

And last then just one.

For down? is in fourth mortgage guess do what have it terms of and your incorporated full-year much I XXXX, unit forecast quarter they volumes? How

Jim Balas

look there, the for to it's down have we're you fourth from at in some we're as if we assuming So you around the XX if - it's look do quarter. the from sources seeing we initiatives. But market - out offsets assuming do, to XX-ish multiple the I'm productivity anything XX XX.

new we've VSG You enhancements to partially that. of in offset price and the have made and products the benefits

Operator

presentation. Ladies concludes today's session Thank this you today's much concludes and attending gentlemen, very thus and for today's call. Q&A

Take disconnect your care. You may now lines.

Corelogic (CLGX) 28 Oct 172017 Q3 Earnings call transcript