Q4 2019 Earnings Call
Good day, everyone and welcome to Derisk fourth quarter 2018 earnings results Conference call. This call is being recorded at this time, all participants I didn't listen only mode. After today's presentation they'll be a question and I said Sasha.
It's time for opening remarks that introduction I would like to turn to come over to bring Skikda think best 30 cents Stacy brought bar Miss Broadbrush. Please go ahead.
Thank you Sarah and good morning, everyone. We appreciate you joining us today for a discussion of our fourth quarter and full year 2019 financial results today's call will be led by Scott Stephenson Verus, Chairman, President and Chief Executive Officer, who will provide a brief overview of our business.
Eric Snyder Chief Technology Officer will then provide an update on our technology strategy, including our cloud migration.
Lastly, Lee Shavel, Chief Financial Officer will highlight some key points about our financial performance Mark I worry Chief operating officer will join the team for Q1 night.
The earnings release referenced on this call as well as the associated 10-K can be found in the Investor section of our website Verus Dot com.
The earnings release has been attached to an 8-K there'll be a furnished to the FCC a replay of this call will be available for 30 days on our website I'm by dialing 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 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 FTC fine now I will turn the call over to Scott.
Thanks, Dave do you. Good morning, everyone I'm pleased to share that night was another strong year for Verisk marked by solid financial results, while we continue to invest for future growth.
Normalizing for the revenue impact of the injunction related to our route measurement solutions, we delivered organic constant currency revenue growth of 6.9% and organic constant currency adjusted EBITDA growth of 7.7% demonstrating organic market margin improvement in 2019.
Moreover, our growth was driven by broad based strength across our insurance vertical and marked improvement in energy and specialized markets. The consistency of our growth comes from four sources first intimacy with our customers.
Second ever deeper levels of integration between our solutions in their environments.
Third a steady stream of innovative new solutions and fourth the cross sell of existing solutions to existing customers within insurance, we continue to enjoy strong market uptake of our platform analytic environments, including light speed for automated underwriting and touchtone for catastrophe modeling.
Solutions are being well received by both the traditional PNC insurers as well as the insurer tech startups, who need data analytics to effectively price and sell in a competitive market. We've experienced great success with the insurer Tech segment with more than 100, new sales wins in 2019 alone.
Our energy and specialized market segment delivered improved growth in 2019, driven by particularly strong results in our market and cost intelligent solutions as well as improvements within our core research it would mckenzie.
In addition, we delivered strong topline growth and improving profitability from our breakout areas, including the lens platform and our chemicals and energy transition solutions.
As always we are in close conversation with our customers as they navigate the near term macro environment.
In financial services 2019 was a year of transition as we evolve from a tops down orientation to a bottoms up approach with an emphasis on steady growth along that journey. We took a very deep look at all or solutions in various financial certain solutions and concluded that our data hosting business what we.
Call Argus data warehouse no longer aligns with our core business model.
As such earlier this month, we entered into an agreement to transition the Argus datawarehouse by transferring approximately 50 people and licensing our intellectual property to partner so that we can focus on data analytics.
We believe this transaction will position the financial services segment for stronger growth and higher levels of profitability going forward.
Continuing on the strategic fronts on February Onest Verisk closed on the previously announced sale of our aerial imagery sourcing group to that sell group.
This transforms gianni into an asset light operation with a focus on advanced data analytics.
Moreover, it meaningfully reduces the cost structure of RG Ami business, while giving us access to the leading U.S. image library, along with favorable economics.
Regarding our roof measurement solution, we have applied for a patent on our new technology for Ruth measurement, while continuing with our plan to appeal to recent court decision.
On February 14th we closed on the sale of our compliance background screening business. This business was in the claims sub segment of our insurance business. This transaction will allow us to continue to have access to this important dataset, but in a more capital efficient manner.
Together. These three portfolio changes are examples of how we are actively managing our mix of businesses to capitalize on our competitive advantages and stay close to our proven business model of offering platform to analytic solutions and unique analytic objects.
These moves physician Verus for continued long term sustainable growth and improving returns on capital.
On the strategic acquisition front in December we acquired fast a leading SaaS company for the life insurance and annuity industry fast offers a modular flexible policy administration system that allows life insurance companies to modernize legacy systems in stages and without a large upfront capital.
Commitment.
It also provides a channel for verisk to deliver our new analytic objects to the life insurance industry.
Adding fast to the various portfolio is a strong step forward as we make advances in the life insurance market.
The software intensity of our overall business has increased over the years and we're excited about the opportunity for fast software to deliver our analytics and embed more deeply into life insurance customers workflows.
I'm pleased with the early steps towards integration with fast.
Another key strategic initiative for bears is our journey to migrate to the cloud what we refer to internally as cloud first we have made significant progress on this campaign and are poised to keep the momentum going.
When we first started this journey in earnest two years ago, we saw a customer customer feedback and listen carefully to their concerns today and all of my discussions with Ceos of our customers across all of our verticals. There's full support of our migration to the cloud as our customers realize the benefits of Verisk faster.
Our pace of innovation and our ability to enter new geographies more quickly Eric Snyder, our Chief Technology Officer will discuss with you in more detail, our cloud migration and broader technology strategy.
2019 was also a milestone year for our E.S.G. objectives, we became a participant in the UN global compact the world's largest sustainability initiative, which encourages companies to align their operations and strategies around universally accepted principles in the areas of human rights.
Labor environment and anti corruption.
We view participation as an extension of the vision and principles represented by our Verisk way and inappropriate calling card as our business grows and embraces all geographies cultures and people.
Several various businesses work with UN sponsored initiatives addressing human rights and climate weather issues by contributing data analytics professional insight and scientific expertise.
Additionally, the global compact distinguishes verisk with customers and prospects and sets. An example for our suppliers and business partners.
On the environmental front, we again reported to the carbon disclosure project or CDP.
And for the second consecutive year, we balanced 100% of our reported scope one its and two emissions and scope three business air travel with the purchase of energy attributes certificates and carbon offsets.
We're committed to reducing our mission and have continued to do so through office consolidations building improvements and greater data processing efficiency.
In the fourth quarter, we names Patt Mclaughlin as our Chief Sustainability Officer, a first for Verus reporting directly to me.
Pat and I have worked together for nearly 20 years and in that time, Pat led a major business unit for us.
His depth with the company gives him intimate knowledge of who we are and what we value and so in 2014, I ask Pat to work with leadership and employees across Verisk to build a framework for understanding and addressing our impact on society, including the environment.
He is championing sustainability efforts across our operations and advancing initiatives for measuring and reporting Paris in the context of sustainability I.
I would also like to publicly welcome Lora Ipsen to our board of Directors Lora joined US at the end of 29 team and brings with her more than 25 years of experience working as a technology executive that Microsoft Cisco and Oracle, yielding a deep knowledge of the cloud artificial intelligence intelligence and.
SaaS business models.
Lora becomes the fourth woman serving on Verisk supportive directors and also our fourth new director in the past five years.
Finally, I'm pleased to announce that our board of directors has approved an 8% increase in our cash dividend to 27 cents per share. This quarter and has also increased our share repurchase authorization by $500 million.
These actions underscore our confidence in the stability of our business its profitability and cash flows our core position within our three verticals is sound and we're confident in our ability to deliver on our strategies to drive long term shareholder value as we focus on serving our customers while also investing in market leading innovator.
Patient and our people so with that let me turn it over to Eric to provide some insight into our technology strategy.
Thank you Scott Technology is mission critical to our business and as such we are continually working to optimize our technology environment and are always striving to be best in class working in partnership with our business units, we've identified for strategic areas of equal importance dedicating much of our focus energy to them as.
We believe these are the areas most impactful for driving growth and efficiency in our business.
The four areas our first data stewardship second analytics third our cloud first strategy that Scott referenced and fourth our people I'd like to take a few minutes to describe each of these and what we're doing let me start with data stewardship.
One of our key Distinctives is our unique data assets as data is the core of everything we do within this area of strategic focus we are advancing how we protect data how we acquired new data assets and how we processed data more efficiently our relentless focus on data stewardship continuously increases the usefulness of our data and analytics for.
Our customers to reach the next level. We recently added the role of Chief data officer in each of our industry verticals. This role is responsible for driving our data agenda together, our three chief data officers are sharing best practices across verticals to amplify the value of our data.
More specifically the chief data officers are identifying new and valuable data assets, making our assets more usable improving and unifying data stewardship modernizing our data processing pipelines and standardizing data governance across the enterprise for example, they champion the standardization and adopt.
Option of data protection methods like Tokenization for sensitive information across our broad portfolio of products for new data sets, our chief data officer discover and align both internal and partner data for valuable business applications. They are leading with cloud based architectures to speed up data processing times for faster concern.
Option by our customers and finally, they continuously at higher quality data assets with more coverage actively improved data quality and use cutting edge techniques like artificial intelligence and machine learning to link our data assets improved data assets with strong governance form the basis of our analytics portfolio, which I would like to see.
Talk about next.
On the analytics, Ryan, we're pushing the envelope by bringing advanced analytics and machine learning techniques to solve the business challenges facing our customers. We successfully partner with regulators to enable the use of machine learning techniques to improve analytical outcomes. We are developing novel methods to leverage unstructured data sets.
Such as images in audio in conjunction with our already differentiate unstructured data assets to further improve their value.
Our AI and machine learning center of excellence together with our business units leverage our university partnerships to bring research and advanced techniques quickly and efficiently into our solutions for our customers. Our teams focused on accelerating our innovation process and leverage our analytics platform to explore scores of ideas through quick proofs of concept.
Such that we are focusing our energies on ideas that quickly gained market traction.
Now, let's turn to our cloud first strategy.
We are well underway on our journey to the cloud we are multi cloud enabled and have workloads running an all leading cloud providers approximately one third of our compute environment is currently running in the cloud.
Our multi cloud strategy aligns our migration approach with our customer requirements, when and where necessary and the pace of our migration continues to meet our customers' expectations.
We are leading the migration via our centralized cloud center of excellence, which is offering advanced capabilities to our business is in the areas of cloud architecture financial management security operations and training each of our businesses in all three verticals actively engaged and work closely with our center of excellence to ensure a.
Secure timely and cost effective migration takes place a significant benefit of our move to the cloud is our ability to reduce and forecast our compute costs and the cloud our unit costs are reduced and our linear in lock step with our utilization of cloud services. We are taking advantage of near infinite compute capacity.
By flexing and contracting in direct response to demand by both scaling horizontally for peak periods and contracting turning environments off when not needed. Let me share. An example of an environment. We have moved from on premise datacenters to the cloud and the benefits we are realizing our telematics platform, which houses over 100.
Billion miles of driving data has been completely re architected to enhance the quality and timeliness of the analytic provided to our customers.
By moving to the cloud we have reduced processing cycle time, while at the same time, reducing cost offering an overall improved experience for our customers or telematics solutions as we move forward, we will incur transitional cost associated with re architecting and optimizing our solutions to best benefit from cloud platforms.
Fourth and perhaps most importantly is our people our talent access is superior globally, and we continue to build and attract world class talent in both our data science and cloud disciplines data scientist and cloud architectures want to work with us because we have some of the most interesting business problems to solve and we are doing so in that.
Cloud.
Our data Science Excellence program is an immersive four plus year rotational training program that firming brings the brightest talent from top schools to Verisk and exposes them to our customers business challenges as meaningful contributors to our analytic teams and from a cloud perspective, we are develop advancing the cloud skills of our people.
Our teams have obtained hundreds of cloud certifications and we plan to double that number in Twentytwenty. In addition, we have augment at our internal teams by attracting experienced cloud professionals in the areas of cloud architecture security and development operations. We continue to invest an optimized in all four of these strategic initiatives and our car.
Evident in the value they are bringing to our people to our customers and to Verisk. Overall now let me turn the call over to lead who will provide an update on our financials. Thanks, Eric first I would like to bring to everyone's attention that we've posted a quarterly earnings presentation that is available on our website moving to the financial results for the quarter on a consolidated and.
GAAP basis revenue grew 10.2% to 677 million net income decreased 9.6% to 132 million, while diluted GAAP earnings per share decreased 8% to 80 cents for the fourth quarter 2019.
The year over year decrease in GAAP net income and EPS is primarily the result of acquisition related earn out expenses of 28 million as many of our acquisitions are on target to achieve payments for strong performance. In addition, a higher effective tax rate due primarily to higher option exercises in the prior.
Year period related to expiring options associated with our IPO 10 years ago reduced net income and EPS in the quarter.
Moving to our organic constant currency results adjusted for non operating items as defined in the non-GAAP financial measures section of our press release, we believe that our operating performance remains solid.
On an organic constant currency basis, and including the impact of the injunction Verisk delivered revenue growth of 5.4% for the fourth quarter of 2019 growth was led by the energy and specialized market segment, which was our fastest growing segment for the second consecutive quarter insurance also delivered solid growth.
While financial services results were stable.
Organic constant currency adjusted EBITDA growth was 9%, reflecting leverage from organic growth across all three segments.
Total adjusted EBITDA margin for the quarter was 47.1% flat with the prior year period, including substantial investment.
This total adjusted EBITDA margin includes both organic and inorganic revenues and adjusted EBITDA.
Normalizing for the revenue impact of the injunction organic constant currency revenue grew 6.3% organic constant currency adjusted EBITDA increased 11% and total adjusted EBITDA margin expanded to 47.5%.
Moreover, on an organic basis, and particularly on the pre investment organic basis that we've discussed before we saw margin expansion in all three of our segments demonstrating the exceptional operating leverage at the core of our businesses on that note, let's turn to our segment results on an organic constant currency basis.
As you see in the press release insurance reported 5.2% revenue growth, while adjusted EBITDA increased 6.6% for the quarter normalizing for the impact of the injunction insurance would have achieved 6.5% organic constant currency revenue growth and 9.1% organic constant currency adjusted EBITDA growth demonstrating margin.
Expansion, while also investing for future growth.
Within our underwriting in rating business organic constant currency revenue growth accelerated to 8.2% and was very broad based across our solution sets in personal lines and commercial lines.
We saw healthy growth in our industry standard insurance programs light speed suite of products property specific underwriting and catastrophe modeling solutions revenue. We also had positive contributions from our international business.
Within claims organic constant currency revenues declined 1%, primarily driven by the injunction.
Normalizing for the impact from being junction claims delivered 2.9% organic constant currency revenue growth held back by fewer severe weather events. This year as compared to last year, reducing transactional revenue growth.
However, our claims subscription revenues continued to see solid growth and were primarily driven by claims analytics and repair cost estimating solutions.
Insurance adjusted EBITDA margin was 53% for the quarter flat with the prior year period normalizing for the impact from the injunction. The insurance segment adjusted EBITDA margin came in at 53.5%, reflecting leverage from the organic growth offset in part by continued investment.
Energy and specialized markets delivered revenue growth, 7.1% for the quarter, driven by particularly strong sales of our market and cost intelligence solutions and core research revenues as well as contributions from our chemicals solutions and the energy transition practice, we also had positive contributions.
From environmental health, and safety and weather and climate analytics revenues.
Energy and specialized markets adjusted EBITDA increased 23.8%, reflecting leverage on strong sales balanced with ongoing investments in breakout opportunities, including our lens platform chemicals and the energy transition practice.
Adjusted EBITDA margin expanded to 32% from 30.8%.
Financial services revenue grew 2.1% in the quarter led by growth in fraud, and credit risk management solutions as well as portfolio management solutions. This was offset in part by declines in enterprise data management revenues as Scott discussed, we have decided to transition our data hosting operations to apart.
Dinner, which will better position this segment for more predictable sustainable growth.
As evidence the financial services segment would have delivered revenue growth of 7% in the quarter without the impact of the Argus data warehousing business.
Financial services segment, adjusted EBITDA increased 6.2% and adjusted EBITDA margin expanded to 40.3% from 37.9%, reflecting strong cost discipline.
Our reported effective tax rate was 23.2% for the quarter compared to 18.6% in the prior year quarter, primarily due to the impact of a higher level of option exercise in the prior year period for the full year, our effective tax rate was 20.9%, which was inline with our targeted range.
For 2020, we expect our tax rate to be between 19% and 21%, though there will be likely some quarterly variability related to the impact of employee stock option exercises, which depends in part on the Verisk stock price and employee personal decisions decisions.
Adjusted net income was 188 million and diluted adjusted EPS was a $1.13 for the fourth quarter 2019 up 8.7% from the prior year. This increase reflects organic growth in the business contributions from acquisitions and lower average share count. These increases were offset in part by higher depreciation.
And amortization increased interest expense and a higher effective tax rate.
Net cash provided by operating activities was 176 million for the quarter up 1.7% from the prior year period, reflecting primarily a higher effective tax rate due to the option exercises in 2018 mentioned earlier.
Capital expenditures were 64 million for the quarter down 16.3% from the prior year period, primarily the result of reduced capital expenditure at GE Omni Capex represented 9.5% of total revenue in the quarter.
As we look to 2020, we expect capital expenditures to be in the range of 250 to 270 million included in this number are one time expenditures of approximately 35 million related to the consolidation of office space that we have planned in two key cities, London and Boston, We are excited about the long term.
Benefits of having our business units and people together under one roof.
Related relating this to Capex, we expect fixed asset depreciation and amortization to be within a range of 170 million to 180 million in comparison to the 186 million for 2019.
Depreciation and amortization should be lower year over year helped by the sale of our imagery sourcing group, including the planes and sensors to vessel, we expect intangible amortization to be approximately 165 million in 2020 in comparison to 138 million in 2019.
Depreciation and amortization elements are subject to FX variability the timing of purchases and completion of projects and future M&A activity free cash flow was $112 million for the quarter, an increase of 16% from the prior year period, primarily due to lower capital expenditures.
During the fourth quarter, we returned 141 million and capital to shareholders through share repurchases and dividends, we repurchased approximately 700000 shares at a weighted average price of $145 in seven cents for a total cost of 100 million.
At December 30, Onest 2019, we had 128 million remaining under our share repurchase authorization, we remain committed to ongoing capital returned to shareholders and as Scott mentioned, we are pleased that Verisk board of directors approved an additional authorization of 500 million for share repurchases as well as an 8%.
The increase in our cash dividend to 27 cents per share this quarter.
As Scott mentioned, we have recently engaged in a series of transactions that focus our portfolio of businesses to fully capitalize on our key distinctives and our core competitive advantages.
Each of these transactions is unique in its structure, but share the motivation of active capital discipline and achieving more predictable long term growth at Verisk.
Before I conclude and looking ahead to the first quarter I want to inform you of a timing shifts in expenses between the first and second quarters that will impact our reported financial results. The company recently changed the timing of the grant of long term incentive compensation ended the first quarter from the second quarter previously this timing change aligns with.
Derisk with a greater market and more closely times employee compensation with calendar year results, the resulting impact will be increased expense of 10 million in the first quarter related to long term incentive compensation, but that will reverse to a benefit in the second quarter.
We are excited about the opportunities to invest in our business and remain focused on long term profitable growth and solid returns on capital, where we remain confident that we have the financial strength and capital structure to support investment for the long term. We continue to appreciate all the support and interest in Verisk given the large number of analysts that we have covering us we ask.
That you limit yourself to one question and with that I'll ask the operator to open the line for questions.
Thank you sorry minded to ask a question you in the depressed by one on your telephone till we try a question Brad the key.
Again, if we will like to ask the question Press Star then a number one I guess telephone keypad. Please standby, we compile the PNM Sir.
Your first question comes from the line of coming up but snack from Barclays. You May ask your question.
Thank you good morning.
Question is around the cloud strategy, so just kind of a two parter so one.
Scott when you reference you were talking to customers in the AD supported that the move other customers also soda in this cloud move and are ready to adopted or would that be at transition period, a duplicate cost unaudited. So the customer better and then Lee I was just hoping you could put some financial.
Parameters around like how much of spend savings et cetera, we might start thinking about.
Yes, all I'll start with that Mark good morning.
Our customers are in various stages of considering how they're going to manage their own technical infrastructure I would say in general that our company is has moved faster probably considerably faster.
In modifying our compute environment relative to our customers.
But it doesn't really.
It doesn't really.
Create and added burden.
For our customers or put more cost into the system as we work with them in fact, if anything the interface between us and the customer becomes a little bit easier to manage so theres no. There's no systemic increase in cost. We obviously as we've talked many times. We are we are adding the cloud dimension to our.
Business.
Even as we are working to retire the premise dimension of our business. The premise dimension comes off sort of in shells, the cloud sort of growth in a linear fashion is as Eric said before but we've absorbed all that into into our BNL.
And our just artist.
We continue to head in the same direction at the same pace.
And so it all feels very organically customers, it's really nothing but good for customers and it doesn't it doesn't add and an additional burden for them.
Finally, I don't know if you wanted to talk a little bit more about the specifics sure and might have thanks for the question I appreciate that you know the.
Very simply we are providing an estimate of the cost savings.
For a couple of reasons. One is that this is a multi year project as we are rolling out these transitions across.
Many datasets, many individual businesses and while we're tracking it on each of those bases and we look at each of those situations as test cases, where we can see the savings we can see the return on capital for the investments that we're making because of the.
Rolling impact of us achieving some savings investing in the transition over time, we don't want to create a fixed benchmark I think from our perspective. Our view is that this activity will generate both operational improvements in terms of lower opex relative to.
This function and so there will be a margin in benefit that supports our overall margin improvement objectives as well as EBITDA growth ahead of revenue growth as well as capital efficiencies that will boost our return over time.
But given that it is deeply embedded within our businesses and something that we're managing as part of their full technology spend it's not something that at an aggregate level and we are going to provide that a full full estimates for for that reason, but we absolutely have seen those benefits in.
The projects that we have executed within specific datasets in the businesses and we'll expect that to kind of roll forward as we prosecute this initiative overtime.
Next question.
Your next question comes from the line if I understood Stern men from JP Morgan you May ask your question.
Hi, Lee its margin question. So the fourth quarter 2019 reported EBITDA margins were flat year over year, that's reported that's including past acquisitions as well as the drag from the roof support injunction you were good to say how much that drag from the roof support injunction is and also we're seeing the operating leverage.
From the breakout admission to the core so as such as various position to FY 2020 reported EBITDA margins to be flattish to perhaps leaning forward.
Yes. So thank you Andrew I appreciate the question and that and the consistent focus on margin we bring the same discipline in looking at our overall business. So I. Appreciate the fact that what you recognize is at the core we are generating very strong and consistent operating leverage in the businesses.
On a core on a pre investment basis. So in the fourth quarter, we did see that margin expansion for all of our core businesses before the impact of our breakouts, which include GE omni as well as the impact from our from our acquisitions and so we.
It's certain certainly shouldn't come as a surprise that GE omni was a significant impact in terms of investment in the fourth quarter of 2019 as it was.
In for the year as a whole and so you would that element will certainly benefit from the transaction with with back sell so at least that component.
In 2000, 2020, I'm should have a substantially reduced impact overall on margins, but that's balanced then again of course, the ongoing investment in our businesses that we make on a return basis as well as the impact from him from acquisitions. Our long term objective continues to be.
To generate EBITDA growth in excess of revenue growth on an organic basis and to improve that margin over overtime and I think going into 2020, we feel.
As confident as ever in our ability to achieve that.
Thank you.
Your next question comes from the line Toni Kaplan from Morgan Stanley. Please ask your question.
Thank you.
Scott just thinking about your strategy of getting out of the data collection and aerial imagery and also the data hosting business Argus. It doesn't sound like your view on the Valley live data is change, but maybe just some tangential away is how do you get the data and what you do it that is slightly changing until.
Just wanted to understand like because they knew partnership around the Argus Datawarehouse change anything with regard to the ownership of the data and just how you're thinking outside and then Lee if you could get some additional color on the financial and Patrick then that cost savings from that that sell transaction and how much revenue.
Total.
Reduced by all of that portfolio actions. Thank you.
Thanks, Tony So.
First of all our view the value unique data assets is completely unchanged.
And actually if anything I think.
Going forward unique unique data assets actually will be even.
Probably more rare.
Not not that we feel that there is any there will be we will take any step back in terms of the volume or the value of the data.
That we've got so our view of that as a part of our business is completely unchanged.
Data remains the oxygen in our blood stream and it always will so the two changes that we made first of all but what I would really like to emphasize around.
That sell transaction is that we actually put ourselves in physician to have an even better dataset.
That sell was as we as we've already described already engaged in data capture they're also one of the globes, leading providers of sensor technology, and so putting together our image capture process with their methods and some of the commitments they already had.
To creating this this image library, we actually have access we will have access and we have access to a better.
Set of images than we had before and that.
Substantially improved economics. So it's it's it's merely about how do we get to the data not our we interested in the data.
And with the with the move with the Argus data warehouse.
Thats, a little bit different because the Argus data warehouse was not about.
Our our gathering of data from customers that was really customers, who had observed our facility with dealing with their data and they said can you essentially white label your way of managing data to me.
And we said, yes as as a.
As another benefit for for our customers and what happened over time as this this whole space of.
Hosting data warehouses, and particularly cloud enabled.
Has just sort of exploded over the last several years.
And it was never founded the ADW work was never founded upon providing us a data source, which we then translate through our analytics. It was it was really more of an accommodation for our customers in there in their own workflows.
So there is really theres really no change in term, where there is zero change in terms of our access to data in the in the financial segment.
So we view data as we always have we have.
As much or better access to data that we used to in our economics of improved as a result of these changes that we mainly anything you've got that you have Tony I give you.
Some sense that from a from a financial impacts standpoint, I understand you want when they get a sense from a from a revenue perspective.
That you we would kind of roughly estimated approximately on in the fourth quarter. There were approximately 8 million of revenues associated with the image capture business that will be moving to that we'll be moving to have XL. So it gives you kind of some sense of the scale on from an EBIT or.
Theres not a material impact from a.
From the impact of those of those revenues, so kind of roughly equivalent level of of EBITDA expense associated with that but on a year over year basis, we are expecting a the benefit of eliminating the the costs associated with.
The individuals and the flight operations associated with that image capture business that we will no longer continue to bear even though we will continue to have access to all of that data on very preferential terms I'm. Looking ahead. So it will clearly be a benefit to us from a from an EBITDA perspective.
Thank you.
Your next question comes from the line of Gary This the of Bank of America, You May ask your question.
Yes. Thanks, Good morning, guys I wanted to ask a just a bit more about the margins in the quarter. So a quarter ago you talked about.
Loss of revenue from the injunction not having enough time to really get at or reduce those costs and yet the insurance margin.
Was was quite strong so obviously, you're able to get rid of.
Rid of a bunch of that cost in and on.
On the energy business, we'd also thought there would be maybe more of a drag than it appeared there was from the Gen. Scape deal that I think you on for a couple of months in the quarter side, just help us think about as we think moving into Q1 and moving forward.
What what the dilution from Gen scape is and what.
How we think about the GE omni.
Lost sales and the impact of that all in with backfill. Thank you.
Yes. Thank you Gary I'm, so a lot of a lot of elements I am here. So let me try to give you a couple a couple of components of that so I think the statement that we made in the third quarter with regard to not being able to make substantial headway on on the expense for Jeremy in the fourth quarter.
Is is accurate kind of specific to the overall entity within our within our GAAP within our GAAP results.
Naturally the vac sell transaction.
I will.
Be moving substantial part of that expense not all of it we will have operating expenses associated with our analytics component of that business that will be retained but a in excess of the majority of the expenses will move out of the move out of the business but.
The margin uplift within with insurance really wasn't driven by cost savings within GE Omni I think it was just the natural operating leverage within the within the business as a whole.
And specific to the energy and specialized markets I'm discussion there are market and cost intelligence business and the strong growth that we experienced within that business.
As well as cost of disciplined wood Mackenzie was really the primary contributor to the margin expansion within that business and for the business as the as a whole and so there we are benefiting from a very strong growth in that in that product and.
Relatively low associated expense expansion within that so I think that is when we look at that margin strength. There was certainly some component of it within insurance, but a lot of that benefit came from from those activities. So as I mentioned with regard to Andrew's comments I think all of those effects.
We think will put us in a very good position to continue to work towards that that margin expansion objective that we have over the long term in 2020.
Thank you.
Your next question comes from the line of handset Rosario from Jefferies. Your line is open.
Hey, good morning, Thank you historically.
You guys have not talked a whole lot.
Commercial sales organization on calls.
Maybe just give us an update.
Is that an opportunity however, you measure salesforce productivity.
And any changes to incentives maybe that you've made there or haven't made.
As you look forward for growth it seems like you're doing a lot of acquisitions around software.
Sort of penetrate customers Bart.
Any thoughts this to you know, adding salespeople and going after more revenue.
Thank you.
Yes, so obviously an important dimension of our business across all the verticals, we take a three tier approach to selling so we have account representation, where there we have people who are owning our end to end relationship with with our customer than we have product specialists, whether they be data analytics.
Solutions or.
Software solutions, almost everything that we do as very technical and so we do need people who are focused on specific parts of our product suite to go in.
Present credentials.
Work on issues of integration.
Etcetera, and then thirdly, we have inside sales to help us cover.
What in some cases as the fairly long tail of smaller customers inside of our market spaces.
Generally we find it a good use of of.
Money to expand our go to market team and we're always looking.
To do that and the only other thing I would say in this ties a little bit to the point that Lee was just on as we make acquisitions, which are inside of verticals. There were already serving one of the things. We think hard about is how are we going to integrate the too and I will say by the way that that we had ambitious plans for gen scape integration and the team has met all of their.
Remarks, and so it's gone it's gone very very well, but one of the places where we're fairly slow to take any to take any cost out actually is with respect to market representation. So as we say integrate something that we acquire we actually want to hold onto the go to market resources as much as as we possibly can and then we're always.
Asking the question would would more be helpful. I mean in general I would just say that I've I've really been pleased in impressed with what our teams accomplished in 2019 in terms of building our book of business. So yes, it's always on our mine. We've always had the same structure, we always lean into more investment in that area when it makes sense.
Thank you next question.
Your next question comes from the line of Jeff Miller from Baird. You May ask your question, yes. Thank you with the preface that I fully recognize the importance of data and analytics as a source of value. The solutions, Scott will love kind of your perspective on where you draw the lines or what types of software solutions you.
Back to provide for just talking about increased software intensity the life insurance software acquisition and some other software acquisitions. We've done but you also continue to partner with the likes of Guidewire and I think there was a relatively recent announcement with with Duck Creek, So what types of software solutions.
Do you expect to provide where do you look to partner to you increasingly compete against some of those vertical software providers over time. Thanks.
Yes, no. It's it's a good question and it does relate to the fabric of our company. So.
Bottom line for me is that.
I would only want to see us in software businesses that have the potential to yield data assets that we can use and reuse for analytic purposes, that's really that sort of the bottom line. So there are there a core transaction processing.
Platforms the tend to exist in all the verticals that we serve and to the extent that those those those particular platforms are unlikely to yield any sort of data.
Data rights.
Then, it's just less likely to be of interest to us.
That's the first that's the first dimension of it in the second sort of relates to the first and that is what we're really interested in is what we call platform to analytic environment. So we want to be.
The place where somebody who is trying to make a decision goes they go in the morning, and they stay there much if not all of the day, that's our ambition thats, where we want to be almost by definition if thats. The nature of the software you're providing then you are close to the data sets. So thats really the distinction that I would I would I would trace for you here.
Thank you.
You bet.
Your next question comes from the line of Andrew Jeffrey from Suntrust. Your line is open.
Hi, Good morning appreciate you taking the question.
When I think about.
A few call out drivers that you discussed.
And in insurance I'm thinking about the opportunities and in life, and ensure tech, which sounds pretty robust as well as UK, which.
I think.
It was mentioned, we I think you mentioned as being pretty strong.
Can you over the next few years, perhaps quantify or Dimensionalize, how those may.
Ben the growth curve and your insurance business.
Sure, so I'm going to I'll I'll take a.
Take a first cut at it and I'm sure Mark and can provide some some broader perspective on it so I think as it relates to the insurer Tech dimension.
Our view is that it contributes to incremental growth across two dimensions. One is that we have a group of new clients that we are serving in a in a traditional contacts with with our industry standard products and other and other datasets, but the other dimension is that.
Yeah, they are bringing innovation new ways of doing things that is putting more of a focus around our traditional customers to utilize data more intensively than they may have in the past and that is creating new opportunities for us to develop products to support their needs and our lights feed.
Suite of products is probably a perfect example of that have that dynamic and so it is I would describe at one level as accelerating the demand and the expansion of analytic objects and demand for platform analytics that has it.
Enabled our underwriting in rating business to generate levels of growth as you've seen in this quarter that probably wouldn't have been expected two or three years ago. So I think that's that's one dimension of it and we spent a lot of time thinking about the life opportunity.
Ill hand, it over to Mark to describe.
How we see that opportunity influencing and providing incremental growth for us.
So let me basically said this I think there's two types of ensure tax one is on making sure. We're probably at managing general agent on underwriting business or at least trying to find business. There. What they are looking forward to begin to business faster automate and that drive towards a nation drive trucks magnet technology.
He.
Has been a wonderful opportunity for us and we.
We have had some great sales there and it has accelerated growth across all of insurance Theres also ensure tech that they're trying to do some technology around data and information and although probably on the outskirts could be competitive overtime. So we certainly keep keep track of them.
I guess the theme that I will bring out which kind of may tie together a couple of questions is our customers are interested in content, that's king but at the same time, they're pushing towards automation they want the seamless ecosystem.
So they can tap into any data or any solution, whether it's their own or third party and they expect through a series of ipi microservices to be able to.
Consume that information or consume that application in a very seamless way and I think that is a large part of why we're thinking that the fast acquisition will help us quite a bit. It. It is that light touch quick implementation law upfront cost that life insurers are looking for.
And we see the same thing.
Probably PNC is a little bit of head from a from a analytics perspective.
But we see the same thing for PNC customers. So.
Hopefully that provital broader color.
Thanks Mark.
Your next question Santander line charge song from Goldman Sachs. Your line is open.
Hi, Thanks, Good morning, your pace of M&A activity has picked up in recent quarters, particularly with the acquisition of Gen scale. When you had a similar level of M&A activity in 2018, EBITDA margins did contract by about 100, Bips. So diving deeper into margin from a year ahead can you discuss how the margin profile of Gen compares to your earlier acquisition.
Particularly ones being integrated in 2018, and if you intend to changer pace of investment activity in a breakout opportunities. This year ahead versus earlier years. Thank you.
Yes, Thanks, George Im so whenever we talk about the margin impact I want to to kind of start with the fact that the important thing for all of our businesses is that they have fundamental operating leverage that allows us to deliver on EBITDA growth.
In excess of of revenue growth, because we think thats the fundamental value creation driver for that for that business and so we look at each of those businesses. In every business has a different margin margin dynamic, but we want to make certain that that that that dynamic is present and we have the ability to improve upon that over time.
We so when we're looking at Aquas acquisitions, George we are funded fundamentally making eight capital decision and a group decision in terms of is this going to be a good use of capital can we generate a good return on the business and what we can do to enhance it and beneath that is their operating.
Leverage that will allow us to continue to generate that EBITDA growth over time, and so when we talk about our organic constant currency revenue growth. Yes, we are making that adjustments. So that we see that dynamic across our business as a whole we tend not to be.
Overly focused on the portfolio impact of the acquisitions because if it is a good return acquisition and it has operating leverage than it will allow us to generate that EBITDA growth over time, and I think talking about it in individual acquisition like Gen scale, which is is going to come in at a lower margin.
And then the rest of the business that will naturally have a portfolio impact, but what we can we hope to generate with that business in its association with wood Mackenzie and generating incremental returns and incremental margins should really drive what we're focused on which is that EBITDA expansion ahead of revenue growth I'm. So I know that isn't a occur.
Please answer to your question, but philosophically I think it's important to understand that's that's the way we the way, we think about those acquisitions and their contribution.
Your next question comes from deadline of Kevin Let me from Credit Suisse. Your line is open.
Great. Thanks.
Lee you talked about kind of three different portfolio transactions.
An aerial financial services insurance can you give us kind of the overall revenue and margin impact from those dispositions.
So I think I gave the.
The impact from the back so im from the back sell transaction.
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So I and the other the other ones I think I like we can deal with in a in a follow up call.
I, just they're not that material overall to the business I think the 8 million is really the bulk of it. So we can probably find we can fine tune that with you offline separately, but it's the the the geometries XL transaction that would have the the more significant impact the rest are.
Less significant.
Super Thank you.
Your next question comes from the line of Jeff Silber from BMO capital markets. Your line is open.
Thanks, So much just wanted to step back and kind of look at your portfolio of assets you did some pruning I think.
Last quarter or so.
Is there anything else left to divest and then also do you see synergy between the three major verticals, obviously within insurance Theres a lot, but I'm just wondering cross synergies with the other verticals. Thanks.
So we're always looking at the mix of assets we've got.
But I would say that I think we have done a fair amount of the kind of work that was expressed in those three moves will always keep our eyes open.
But there's nothing.
Major which is which is eminent to your question about synergies across the verticals. We have re purpose to energy data into the insurance vertical we're looking at opportunities to tie together observations from retail banking with.
Sumer forms of of insurance. So that work is always going on in the background, but the thing I would really highlight for you is all of the the technical work that Eric described before this is the kind of work where it would be more burdensome for any one of our verticals or even a business unit in.
Side of a vertical to take it on on their own because these are these are pretty large expenditures.
And if you're going to do it right you have to really commit to these things Eric.
I talked about the work have to do the transition to the cloud or to create a data fabric inside of.
The the platform data environment that we provide to all parts of Verus and.
And not only does doing this work excellently and the center provide acceleration to each of the businesses inside of each of the verticals.
But it really represents.
A very cost efficient way of doing it.
As well and so that is that's actually to me one as a large major points of logic as to why we should be in multiple verticals and another one is all of what we do in these verticals and not every vertical has this has the quality, but all the verticals that weren't.
The opportunity for unique differentiated data assets.
Exists and that's not true.
In in a lot of verticals, but it is true in places, where we do business and.
I would add as a case in point, we often.
You get.
Questions about the relevance in of the financial services business and as we've we've talked about the deal with a dataset that is.
In order of magnitude if not more larger than many of our other businesses, but the expertise that we have developed in cloud technology and data analytics within that business generates a return on intellectual capital that we have leveraged in our lens platform within the insurance business as we're implementing that.
Cloud technology, and probably wouldn't be as effective in bringing those efficiencies and advantages if we hadnt been dealing with that dataset and with that level of level of expertise and so I think it's a great kind of case in point in how we leverage that yes, Im just did not want it into too many times, but case in point.
Inside the London insurance market, the expertise and technology associated with the various financial services assets were combined with kindly ISIL expertise to build a platform. There that has been kind of changing some of the London market transaction processing self insurance.
Next question Nick Your next question comes from the line, especially supply drag from Deutsche Bank. Your line is open.
Hi.
Thanks for taking my question quick question team, even exceeding one sonic little bit soft.
Because of the field.
But then event I was just wondering if you can provide any color on how much of the revenues generated from these are the event and as we think about going forward should we see that business the excellent given the stability of the subscription business. Thanks.
So this is mark thanks for the question.
So first of all I want to start with the insurance business as a whole was was very strong we think of it as a portfolio and we're very pleased with the interaction with customers and will progressed specifically to claims I think there's three things that we've seen over.
Over the course of little longer term and clearly short term.
One I think we've talked about some of the extensions we've had really on the.
Claims for water claims fraud detection side of the world's related to outside PMC health companies in like.
Where we brought some time, so the customers and that has kind of rolled off.
But more specifically as it relates to the fourth quarter clearly the injunction affected us we weren't able to deliver the growth that we've been delivering inside of geometry that was a negative.
The thing that was clearly changed are different in the fourth quarter of 19 relative to 18 was a relatively modest.
Set of storms there was a very quiet storm season. This is about catastrophes. This is just.
Severe weather throughout the nation.
That had been now.
Quite a bit of impact on whenever for is to claims business. So those two things we're kind of the anomalies in the quarter I will reassess reinforced underlying.
Business the underlying economics remain very strong customer engagement very strong and I think the mission were on with regard to automation and automating.
Claim adjusting is.
On the theme inside the industry. So we remain optimistic.
And Mark, let's let's just clarify real quick when you talk about the effect of the health insurers coming into our claims are claimsearch platform and you referred to as rolling off what you meant was it provided if it's not that they went away they certainly to sort out there selling the prospects as much as they ever work the grow over right, Okay and represented.
Growth in 2018 and into 2019, but now they're in and they are solidly it yes.
Your next question comes from the line of Greg Peters from Raymond James You May ask your question.
Good morning. Thank you for fitting me in the large insurance brokers seem to be pushing data analytics as a growth area for their business.
Can you tell us how you're working with them or should we view their strategies as potentially encroaching on your business.
They have also reported good organic revenue growth than its impart due to the strong pricing environment and commercial lines can you talk to us about how youre business is affected by pricing trends and commercial lines insurance and then finally on light speed.
Can you give us an idea the size of that business I've been struggling to identify actual customers in our channel checks, but that doesn't mean I'm looking in the right place. So any help there would be appreciated.
Well you managed to get three questions in there.
I think I kind of poor.
Hey, Mark why don't you and I do this together I'll just take the first part of that which is the question about the brokers. So the brokers and we really do not have a lot of overlap.
The brokers from time to time attempt to put together some you know some.
Some forms of data analytics in order to try to add value inside of their customer relationships, but fundamentally they and we there. They are more much more of a service oriented kind of a business.
We license subscription solutions to our customers.
And the brokers.
Touch a good number of situations.
And they have the data associated with the transactions that their engagement, but those datasets are really not overlapping of the datasets that we have got.
And so.
I mean as a practical matter out in the marketplace. We just don't compete with with the brokers and nor do I think we will compete with the brokers there just a fundamentally separate kind of an environment.
And in fact, they operate as customers because.
Particularly our catastrophe modeling solutions.
Our made available to them as well as to others. So.
Yeah, you know if I was running one of one of the major brokerages actually if I was running almost any business in the world I would try to make a more data analytic as a way of trying to achieve advantage and that's that's what they're working on but I don't.
Their business model and ours is.
That's very different basically and I think will remain so mark you want to take on those other and I'll just add two years I think from a brokering broken fee perspective, clearly, they're looking to differentiate themselves. So they are providing analytics I think most that analytics leased the way we've seen it.
Is sold into and provided to the corporate customer where were more on the insurer side.
That.
I think your second question was around pricing.
Pricing impact so commercial lines.
Hardening market if you will.
I think the short answer is that if our customers are growing quicker.
Theres more opportunity to focus on topline focus on.
Dancing potentially purchasing new solutions.
To foster that growth.
So I think it's a friendly environment when everyone is growing and it's probably more opportunities to buy new solutions or extend them.
We do have this wonderful.
Solution inside of underwriting rating, our ISO business when it is a difficult period or its soft market and people have to go back to the actuarial fundamentals have to go to fundamentals around how I underwrite because they want to be profitable. So clearly that supports our business as well, but I think everyone is.
In better shape with a high tide floating all boats last question I think I was around lightspeed.
Let me say it this way the way we packed up Lightspeed is we are trying to take and in the world of insurance I'll use personal automobile you can get online and you can get a quote pretty quickly, but what typically happens is after you get that quote people then run all the different reports to get information about whether youre an accident leather in past history.
Less pest accidents.
And all that motor vehicle record data all that cost money. So they then run that information and they.
More or less changed price and about 35% of the cases thats a customer unfriendly way to go. So we are pushing this data afforded forward strategy, we are trying to move.
The point of sale. So there's no separation between binding quote that is more attractive for consumer and we are very uniquely position in the commercial lines market because the data and information we have more so than even in personal lines.
And that strategy that approach has been gaining quite a bit of receptivity.
Among major customers, both large ones and those ensure techs we're talking about.
So when we saw the lightspeed, it's a package of solutions and products and many many insurers are buying pieces.
A few very large ones have signed up for well call. The full package. So that has definitely been contributing to growth inside of our underwriting rates.
When they when that when when customers use that mark I I, just I would think a lot of them actually identify with myrisk, rather than saying, Oh thats touchdown, because as a whole series of services that's.
We tie that together as touchstone.
But I think the customers are relating to the overall brand bears.
Thank you for your answers.
Welcome to next question comes from the line Bill Warmington from Wells Fargo you'd ask your question.
One.
So.
Good morning, and.
The question I had was to see if we could get.
And update on new product pipeline, specifically around loan verifier also some of the life insurance underwriting products and then maybe also the you could comment on.
How you plan on leveraging some of the unstructured data set.
Audio in land.
And images that.
Eric mentioned in his comments.
Might take those aren't sure. So let me kind of walk through those I think you were talking about loan verifier you were talking about life insurance in some unstructured data. So let me start with the.
Final two because in some ways they're connected.
So life insurance, we think provides a pretty big opportunity for us we do have some solutions already available. So think about our catastrophe modeling what we refer to as extreme event modeling. We do you work along longevity models.
Mortality shock model think of pandemic.
Corona virus, we do that type of work and that fits into some of the life insurance models that are necessary and interested but we're also doing is we're doing work around.
Model as it relates to specific underwriting decision. So that is around partnerships with the medical inspection girl, which represents a group inside of life around that I'll call. It physicals and health we've done some work around electronic health care Records and doing some analytics there to analytics that you're most focused.
John we've done some work around tobacco, we've done some work around application.
Pure kind of like Sky diving that doesn't make you the best risk.
And you know kind of combining some of the technology that Eric and his team we're talking about with some of the specialists we have from an insurance perspective.
We have used some voice recognition technology, which allows us to understand things about your voice and whether theres indication that a lead to tobacco use as an example, so hopefully you can kind of understand one small example of how it fits.
Into a a wonderful technology group.
Helping insurance business extend into life insurance and fast provide some of that.
Hopefully that response, maybe talk a little bit also mark about using imagery to interpret damage to vehicles.
Absolutely without having the sending human being so I think one of the things that we would love to do as part of automated adjusting is due a quick look so this is a.
Well I'll refer to as low severity type of crashing small dollars, but highly frequent.
You can do a quick reviewing and make payments. So we have some bill that needs to take a look at images just think about machine learning and understanding a couple things one is the image legitimate and accurate based upon timing date stamp and things like that was implemented medically.
But we go beyond that to do a few more things one word saying is it salvageable or not should it be complete loss and then to its eligible we can do a quick estimate is what's going to cost repaired and those are the type of things that advanced.
Analytics provide to automate this process and it's a quick way to do.
Things that is typically take in quite a bit time and effort to and fast.
Okay.
Bill I think you'll start the loan verify alone verifier is a another important idea for us what it does though with any of our really differentiate idea as it does take us time to aggregate data. So what we're working with is working with insurers to get information access to a lot of that information behind the scenes.
So that we can connect.
Those folks who are on the loan side of things that could the banks.
With those insurers, who are kind of ensuring that risk and keeps us together some of that information we have an in house at the same time, we have a very strong scatter stewardship approach to thanks.
We can only use data for use cases that have been provide us. So we're working with insurers to validate use case and honestly bring on customers. So hopefully maybe a little long winded, but a full answer to your questions.
Well, thank you very much.
Your next question comes from denying added Nicolas from William Blair You May ask your question.
Hi, good morning.
Realizing your acquisitions of Gen scape and faster are still pretty fresh.
Hoping you could provide an update on how those integrations are trending and then any commentary on the early pipeline builds for those products. Thanks.
Integrations are right on track with both of them, we actually just review that we though.
And.
With respect to everything from cost factors too.
Sales they are performing almost exactly the way that we expected them to and in both cases, they nest very nicely inside of.
Existing organizations.
So these transitions have been very organic.
And.
The pipelines are the pipelines are good pipelines are strong.
The only thing I would add as I think that Theres, just a genuine enthusiasm in the.
In the case of Gen scape among the wood Mackenzie team for the ability to utilize that data and integrated in in their analysis in the products that they are serving for their clients. So every time I'm in contact with wood Mackenzie I hear their enthusiasm for utilizing that data.
Fastest more recent but I can tell you the on the insurance side, particularly on the life side, our ability to work with them as we described before high level of of excitement about what we can potentially accomplished together.
Final question.
Your final question comes from the line of Joseph Foresi from Cantor Fitzgerald.
So your question.
So maybe I should ask click 18 part questions.
[laughter].
I'll give you a soft.
And the day.
On the insurance and energy side, maybe you could talk about the differences in the demand.
Backdrop heading into 2020 versus 2019, either from a pipeline or a necessity on your customer part.
Perspective thanks.
Yes. So let me just give you the perspective that really explains verisk analytics, we have and.
This has been true for a long period of time, our company has grown faster than the end markets that we serve and the reason is that our customers are rotating their own budgets in the direction of what it is the that we do they want to become more automated and they want to become more deeply analytic and the way.
That they run their businesses. So you will see a lot of discussion.
About the level of technology spending.
On the part of the company's the populate the verticals that we serve and that in in of itself is a very constructive trend, but you have to actually take that pool of spending and break that down further into sort of datacenter keep the lights on sort of spending versus the platforms analytic environment.
Analytic objects that we provide and even within the technology category Theres been a rotation in the direction of what we do so if you're looking for explanation in terms of where our businesses and where it's going to go that is the driving force what our companies are trying to do.
And the fact that.
Because of our vertical approach we understand their issues, we have in deeply intimate relationships because we sell.
In the case of insurance.
We may be selling up to 20 families of solutions to our customers and from all this death of relationship and all of the data with that they make available to us. It is really the perfect place from which to try to think about the next thing that they need and work collaboratively with them to develop it and Thats why our business grows.
The actual macro environments inside of insurance and energy you know I mean, they sort of wax and wane a little bit.
But I don't those will not in my view have explanatory power in terms of the growth of our business in 2020 2021 and on.
Thank you.
You're welcome there no further questions at this site recent Sir you may continue.
Great well, thanks, everybody for joining us and as Lee mentioned will have a number of follow ups with you and.
Look forward to those thanks, thanks for your interest.
We'll speak with you soon.
Ladies and gentlemen, this concludes today's conference call. Thank you for your present the basin you may now disconnect.
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