Black Knight, Inc.

Greetings, and welcome to the Black Knight Third Quarter 2020 Earnings Call. At this time, all participants are in a listen-only mode. A question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Steve Egerton, Investor Relations with Black Knight. Thank you. You may begin.

Thanks. Good morning, everyone, and thank you for joining us for the Black Knight Third Quarter 2020 Earnings Conference Call. Joining me today are Chief Executive Officer Anthony DeBoer and Chief Financial Officer Kirk Larson. Our results were released this morning, and the press release and supplemental slide presentation have been posted to our website. This conference call will include statements related to the expected future results of our company and are therefore forward-looking statements. Our actual results may differ materially from our projections due to a number of risks and uncertainties. The risks and uncertainties that forward-looking statements are subject to are described in our earnings release, Form 10-K, and other SEC filings. Today's remarks will also include references to non-GAAP financial measures. Additional information, including reconciliation between non-GAAP financial information to the GAAP financial information, is provided in the press release and supplemental slide presentations. This conference call will be available for replay via webcast through Black Knight's Investor Relations website at investor.blackknightinc.com.

I'll now turn over the call to Anthony. Thank you, Steve. Good morning, everyone, and thank you for joining us for our third quarter earnings call. This was a strong quarter for Black Knight, during which we continued to execute against our strategic growth initiatives, including adding new clients to our core platforms, cross-selling, delivering innovative solutions, and making strategic acquisitions. Our sales have been particularly strong so far this year, despite the challenges from this unprecedented environment. This illustrates that forward-thinking lenders and servicers are seeing the value of our innovations, the integration of One Black Knight, and our sense of urgency in all that we do, and they want to reap the benefits that our valuable solutions offer. First, let me provide an update on each of our businesses, beginning with our servicing software business. In the third quarter, we signed three new clients to MSP, including Caliber, a top 25 non-bank servicer, which I mentioned on the last call, and two mid-tier servicers. Year-to-date, we've signed five new MSP clients, representing over 750,000 loans. We also renewed our MSP contract with Dover Mule Mortgage, a top 10 servicer. In our origination software business, we've continued the momentum selling Expedite, AVA, fee services, and exchange, which are solutions that can be used with any loan origination system. At the end of last year, we reorganized the team that sells these solutions, and the results have been remarkable, as we've seen sales contract value more than double. We also had continued success selling Empower to mid- and top-tier lenders. In fact, we signed two new lenders to our Empower platform in the third quarter. In addition to signing the truest long-term renewal, That includes adding to BB&T production onto Black Knight Systems, which we previously discussed. Next, I'd like to talk about our data and analytics business. Last year, we launched the Rapid Analytics Platform, or RAP. We signed twice as many clients to RAP in the third quarter than we have since launching the product last year, which speaks to the value our clients see in the solution to help them make informed business decisions and develop effective and informed strategies. In addition to being a powerful platform, RAP drives more bundled data sales and is a differentiator when it comes to customer renewals. At the onset of the pandemic, we launched the McDash Flash data set to give clients deeper daily insights into the impacts of the coronavirus on servicing performance. In the third quarter alone, we executed eight deals that included both McDash Flash data and RAP. The companies that will be leveraging these unique solutions include four of the top investment banks and a Federal Reserve Bank. I frequently share with our clients, our colleagues, and with you our intense focus on innovation, integration, and urgency. It is this commitment that has enabled us to launch our next generation customer service solution, which helps MSP clients better support their customers by displaying all the information they need to respond to a caller's questions in a single location. so they can respond quickly, efficiently, and accurately. We've signed four clients to this solution since launching it last month. We also continue to add capabilities to our digital origination suite. Our digital point of sale solution, which is now generally available, simplifies the loan application process by leveraging AI throughout the process and enables consumers to complete the loan application on their schedule and from any device. Complementing this solution, we have also delivered a digital solution for loan officers, which gives them a single mobile responsive platform with all the tools they need to serve their customers anytime, anywhere. Next, I'm going to talk about some enhancements we've made to our expedite close solution, which uses advanced intelligence to select the best, most permissible way to digitally close a loan for each jurisdiction. In the third quarter, we acquired DocVerify and integrated this leading software into Expedite Close to support e-notarization and remote online notarization. Another innovation in the digital mortgage lifecycle journey is our new guided close solution that guides borrowers on a document-by-document basis through the closing package. Together, these solutions are transforming closings into a more efficient and contactless process. As the trend towards a fully digital mortgage process accelerates, particularly in the socially distanced environment, these solutions further enhance our clients' ability to serve their customers where they are. All the solutions I just mentioned are integrated and further our digital footprint. We are the only provider in the industry that offers comprehensive platforms across the loan lifecycle, as well as digital solutions that can be leveraged at any point in the process, to help our clients be more efficient and better serve their customers, which leads to increased customer satisfaction and retention. Finally, we continue gaining traction with our innovative servicing digital and loss mitigation solutions. In fact, we now have 43% of the loans on MSP signed for servicing digital and 34% for loss mitigation. Next, I'd like to give an update on our acquisition of Optimal Blue, which closed in September. By combining the Optimal Blue and Compass Analytics teams and offerings, we now have the leading product pricing and eligibility engine, as well as the premier hedging capability in the industry. The combined team has a great deal of experience in both mortgage and technology that will help drive continued innovations for our company. We've already started to identify ways we can aggregate our strong data assets to deliver even more valuable analytics and insights to our clients. The power of this combined set of solutions is resonating with clients of both companies. I look forward to providing you with additional updates on this acquisition on future calls. In closing, it's clear that the core fundamentals of our business remain strong and we continue to execute on our strategy to drive revenue growth by adding new clients, expanding relationships with existing clients, delivering innovative solutions, and pursuing strategic acquisitions. I'm excited about the momentum we have built and how we'll continue to transform the industry. Thank you for your time today. Now I'd like to turn the call over to Kirk for a financial update.