Verisk Analytics, Inc.

Good morning. My name is Cheryl, and I will be your conference operator today. At this time, I would like to welcome everyone to the Very Risk Analytic Q2 2019 earnings conference call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during this time, you may do so by pressing star, then the number one on your telephone keypad. To withdraw your question, press the pound key. Ms. Robber, you may begin your conference.

Thank you, Sherelle, and good morning to everyone. We appreciate you joining us today for a discussion of our second quarter 2019 financial results. Today's call will be led by Scott Stevenson, Chairman, President, and Chief Executive Officer, who will provide a brief overview of our business. Lisa Benally-Hannon, President of Verisk Financial Services, will then provide an update on our financial services segment. Lastly, Lee Shavel, Chief Financial Officer, We'll highlight some key points about our financial performance. Mark Aguilera, Chief Operating Officer, will join the team for Q&A. The earnings release referenced on this call, as well as the associated 10Q, can be found in the investor section of our website, Veris.com. The earnings release has been attached to an 8K that has been furnished to the SEC. A replay of this call will be available for 30 days on our website and by dial-in. Finally, as set forth in more detail in today's earnings release, I will remind everyone that today's call may include forward-looking statements about Verisk's future performance. Actual performance could differ materially from what is suggested by our comments today. Information about the factors that could affect future performance is contained in our recent SEC filings. Now I'll turn the call over to Scott.

Thanks, Stacey. Good morning, everyone. I'm pleased to report that Verisk delivered another strong quarter. marked by solid 7.2% organic constant currency revenue growth, which remains the most important measure of the health of our organization. Moreover, our growth was driven by continued broad-based strength in our insurance segment, as well as marked improvement in our financial services segment. At Verisk, it is our people that drive innovation, provide a great customer experience, and are critical to delivering our consistent and solid financial results. As such, we are keenly focused on maintaining an environment that attracts and retains the best talent through strong recruitment, leading talent development programs, and management training efforts, which ultimately result in highly engaged employees. I'm pleased to share that employee engagement at Verisk is on an upward trend, improving two percentage points from 2018. At the same time, we have maintained retention of our top performers at over 92% in each of the last three years, in what is a very competitive labor market for our kind of talent. From a recruiting perspective, this summer we are hosting our largest class of interns ever, with 119 interns across all our business units who can serve as a pipeline for permanent hires. On the training and development front, we are investing in our future by hiring talent earlier in the talent pipeline and training them ourselves instead of competing for experienced talent. As such, we have expanded our global data science excellence program which is an internal four-plus-year rotational training program for data scientists with a master's in data science or data analytics. We have also extended training programs for talent in key areas, including cloud architecture and artificial intelligence. We have enhanced our management training programs to include offerings for first-line managers as well as experienced leaders, and have expanded our online education offerings in data science and analytics in connection with leading universities, such as Johns Hopkins and University of Michigan. Lastly, as part of our global talent optimization strategy, during the second quarter, we opened a new office in Krakow, Poland. This office focuses on data science and analytics talent, and we are seeing early success building out this team and have a strong pipeline of talent interested in joining Verisk. On the client engagement front in June, we hosted Verisk Vision in London, our client conference tailored to the London and European markets. We hosted approximately 300 attendees for a day-long event that focused on the ongoing transformation in the insurance landscape and covered areas including risk, claims, and insure tech such as cyber risk, artificial intelligence, anti-fraud analytics, and digital transformation. The events also featured the Verisk Innovation Lab, which showcased product demos, featuring new technologies and industry applications which incorporate cutting-edge fields such as social media, image forensics, security and surveillance, aerial imagery, and entity resolution. The event not only solidifies our position as an InsurTech thought leader, but it also strengthens our position as a key technology and data partner for the London and European insurance companies. On the innovation front, we're seeing great success and gaining market share in personal lines due to strong sales of our Lightspeed suite of products. Lightspeed helps our insurance customers compete in the digital age as it utilizes innovative data-forward advanced analytics that enable insurers to provide a fully bindable quote on just three simple pieces of information. This addresses our customers' dual needs to both increase the velocity and efficiency of their operations by increasing the precision of their underwriting analytic. The result is more profitable conversion rates for our customers. Personal auto automation has led the way in this growth, quickly followed by personal property and small commercial. At Wood Mackenzie, we continue to be encouraged by the early results of our data analytic platform called Lens. We have a strong pipeline of interest and continue to sign up new subscriptions with major oil companies, independents, and global investment banks. Additionally, we are seeing solid double-digit growth in both visits and unique users to the platform And we continue to work in partnership with our customers to deliver an offering that is unique in the marketplace One that is scalable dynamic and integrated into their workflows We plan to add the next module global upstream valuations to the lens platform by year end 2019 which we think will be very well received by the market and And in financial services, we're seeing great success with our merchant analytics platform, which Lisa will talk to you about in more detail. Finally, we continue to be engaged on the strategic acquisition front with a focus on finding high return on invested capital transactions that leverage our scale existing resource and deep domain expertise. We recently announced the acquisition of Keystone Aerial Surveys. Keystone is a leading aerial survey company with operations that cover the entire United States. Keystone will become part of Geomni, and it demonstrates our commitment to becoming a leader in aerial imagery, property analytics, and geospatial data solutions. The addition of Keystone will accelerate our nationwide imagery coverage effort and improve our refresh rate as we strive to bring our customers the most innovative and technologically superior geospatial solutions. And now I'll turn the call over to Lisa to provide some insights on our financial services segment.