Q1 2022 CCC Intelligent Solutions Holdings Inc Earnings Call
Yes.
[music].
Greetings and welcome to the PTC and challenging conditions first quarter <unk> earnings conference call.
At this time, all participants are in listen only mode.
A question and answer session will follow the formal presentation.
If anyone should require operator assistance during the call.
And operator by pressing Star then zero.
As a reminder, this conference is being recorded.
I would now like to turn the conference over to your host Bryan.
ICR. Please go ahead.
Good afternoon, and thank you for joining us today for Ya Ccc's first quarter of 2022 financial results.
In our press release issued after the close of market today.
The call today are detached from MRC.
<unk> is chairman and CEO and Brian Curb CCC CFO .
The forward looking statements, we make today about the company's results and plans are subject to risks and uncertainties because the actual results and implementation of the company's plans to vary materially.
These risks are discussed in our earnings release was available on our Investor Relations website under the heading risk factors in our 2021 and our report on Form 10-K filed with the SEC.
Further these comments and the Q&A that follows are cop brighter today by CCC Intelligence solutions Holdings incorporated.
Any recording retransmission reproduction or other use of the same for profit or otherwise without prior consent of CCC is prohibited in a violation of United States copyright and other laws.
Additionally, while we have approved the publishing of a transcript of this call by a third party, we take no responsibility for inaccuracies that may appear in that transfer.
Please note that the discussion on today's call include certain non-GAAP financial measures as defined by the SEC.
The company believes these non-GAAP financial measures provide useful information to management and investors regarding certain financial and business trends relating the company's financial condition and results of operations.
A reconciliation of GAAP to non-GAAP measures is available in our earnings release that is available on our Investor Relations website. Thank you and now I'll turn it over to catastrophe.
Thanks, Brian and thanks to all of you for joining US today I'm pleased to report that CCC delivered strong top and bottom line results in the first quarter.
We had solid performance across all parts of our business.
As customers continue to invest in our solutions to digitize operations.
Like to start by summarizing our financial results for the first quarter.
Revenue was $186 $8 million up 18% year over year and ahead of our guidance range.
Adjusted EBITDA was $73 7 million.
Which grew 33% year over year.
This represents a 39% margin.
Up more than 400 basis points from the first quarter of 2021.
Our ability to deliver consistent and profitable growth.
Across our business is driven in large part by.
Our ability to solve the most pressing operational problems facing our customers businesses.
But then digital transformation is not a nice to have but critical to their long term success.
Given several challenging macro factors, including.
Rising inflation across the ecosystem.
<unk> shortages made worse by increasing levels of retirement and difficulties hiring technical staff, who understand vehicle complexity.
In the tight labor market and of course supply chain challenges.
We increasingly hear from customers that these challenges are mission critical issues that must be addressed.
Profitably.
Adapting their businesses to address these challenges are an important backdrop to what we believe are three key factors driving the digital transformation of the auto insurance economy that will underpin ccc's growth for years to come.
First is the need for our customers to deliver a better experience to the consumer.
Many of the current processes and the auto insurance economy are inefficient and lead significant room for improvement.
These process gaps can drive less than optimal engagement with policyholders and create unnecessary friction among insurers repair facilities and other industry participants.
CCT suite of cloud based solutions.
<unk> insurer routes for many of the critical elements of the claims process. So insurers can focus on the more important task.
And meet the heightened.
Patients of today's consumer.
Second is the benefits of a connected ecosystem.
A key to eliminating the friction I just mentioned is to have a truly interconnected and multi sided network that digitizes key aspects to the claims process.
We have built by far the largest connected network in the industry and one that continues to expand.
I will provide some more examples of this a little later.
Third is the power of AI.
To improve and accelerate decision making.
CCC is build a dataset of more than one trillion dollars worth of claims data over decades.
We are incorporating AI across our product portfolio to help our customers deliver faster and better decisions across a range of solutions and process steps CCC is in a unique position to help our customers benefit from these trends as they progress.
Through their digital journeys.
Our operational and financial performance in the first quarter reflects our success.
The core of our ability to deliver these digital solutions to our customers.
<unk> and our vision for straight through processing or SPP.
STP is a comprehensive approach to the P&C insurance economy.
That will be made up of many digital and AI solutions that are seamlessly integrated to provide customers' digital solutions through while the claims process. This.
This modular approach is a great fit with what customers need to digitize the end to end claims experience.
And demonstrates the value of the CCC clouds deeply integrated position.
Customers tell us they want flexibility and fast time to value throughout the claims handling process.
<unk> cloud readily unlocks this capability without the need for costly and time consuming re platforming.
To illustrate our comprehensive that CCC cloud and our STP vision. This.
To spend a few minutes walking through at a high level, what it claimed journey looks like and how we can add value to each step of the claims workflow.
One of the first steps in the auto claims process.
Determine whether vehicle is repeatable or not for an accident.
We have made significant investments to create a compelling front end experience with their mobile and predictive analytics capabilities that enable insurers to quickly make this determination.
Today, our platform is used to determine the repair ability of tens of billions of dollars of auto claims annually.
For the approximately 80% of claims that are repairable we.
We have a comprehensive portfolio of solutions that help automate and digitize the repair experience in recent years. The car park has become increasingly sophisticated with an ever growing amount of technology embedded in their car.
<unk> automated cruise control lane departure warning systems and multiple cameras.
This greatly raises the complexity of the repair process.
Both insurers and repair facilities need solutions that can provide consistent repair process, regardless of the automaker.
One way <unk> is helping to do this is through CCC diagnostics, which simplifies the process of it.
According the diagnostic report.
And provided invoice directly into CCC, one as part of their workflow.
We have seen rapid adoption of our diagnostic solutions as customers look to CCC to help solve this challenge.
Diagnostics scans, which tell you what is damaged or needs to be reset our recalibrated in a car.
Are seeing explosive growth scans are up more than 900% since 2017.
And are now present in nearly half of all collision repair appraisals.
Dreamliner this process for repair facilities, including validating the scan with insurer as part of the claim is critically important and that point, we recently expanded the CCC diagnostics network with the addition of our partnership with Aztec.
A global leader in.
<unk> calibration and programming solutions.
They went live on the CCC diagnostics network about a month ago.
With the addition of aspect to the CCC network.
We now have more than 10% of our repair facility customers utilizing our diagnostic solution.
We believe diagnostics bend in the industry exceeds $1 billion today and will be a multiple of that in the coming years.
We expect the diagnostics can be at least a $50 million to $100 million revenue opportunity for CCC, making it one of the more compelling growth opportunities for the remaining 20% of claims doesn't determine not to be repairable.
Have developed a comprehensive suite for total loss resolution.
Which is seeing good momentum in the market historically, our total loss products have been focused on helping insurers determine the value of the vehicle.
But there are also many additional balanced training manual processes that need to be completed to finalize a total loss claim including the processing of title lien taxes and fees among others.
That's more than $1 billion of insured loss adjustment expense are Lei <unk>.
Which is the cost insurers incur to investigate and settled claims can be impacted annually.
Taken together, we believe this represents a sizable incremental revenue opportunity for CTC. There roughly 80 20 split of repair and total loss claims I just cover or what we refer to as automobile physical damage or Apd in addition to Apd. Unfortunately.
Accidents offer result in medical claims with roughly one in every five incidents having injuries.
This is referred to as casualty.
And it is a complicated part of the process that represents a significant portion of the total outlays from an insurer in a given year.
Casualty is a huge part of the overall auto claims market.
To put it in perspective.
Medical claims payouts are roughly comparable in size to the annual payments made for automobile physical damage claims.
Casualty represents a significant opportunity for CCC.
Where we have substantially less market penetration and auto physical damage.
We have made significant investments to strengthen our casualty offering in recent years grew dramatically increase the degree of Digitization.
We are starting to see good momentum.
One example of the investments we've made in our casualty platform is to automate the process of reviewing medical bills based on a customer's business rules to health insurer determined the bill should be paid directly.
<unk> spent four exception handling and extra support.
These investments are starting to pay off.
This quarter, we added two new national carriers to our casualty platform.
We remind everyone pain.
Payments is not material to our revenue in 2022, but it has an exciting future growth opportunity.
Subrogation, the process, which protects consumers and insurers from painful losses, where the insured is deemed not at fault or only partially at fault is also a sizeable opportunity across the claim spectrum.
We're making excellent progress with the integration of safety.
Which is on track from a go to market and product integration perspective.
Our initial focus is to leverage ccc's existing data.
The launch a new version of safety solutions quickly and.
With minimal effort needed on the part of carriers.
We have been very encouraged by early customer feedback on this acquisition.
Which has been consistently positive and has led to a number of new opportunities in the short time, we've owned safety.
As a reminder, safety technology helps to automate subrogation, a multibillion dollar area of focus.
Florida insurers that is historically leverage little to no technology to automate the process.
We are excited about the opportunity in subrogation and see multiple ways to expand the offering over time.
We are looking forward to highlighting all of these new innovations when we host our annual industry Conference later this month.
We're thrilled to once again be hosting this event in person meeting with customers and partners discussing key trends shaping the industry and having deep discussions about our CCC can continue to help solve challenges in their businesses.
These customer learnings inform our innovation flywheel and enabled CCC to continually develop new solutions that increase the value we can deliver.
In summary.
We see many great opportunities to deliver innovation across our client base, regardless of their size or the breadth of solutions they use from us today.
Before I turn the call over to Brian I want to close by reiterating how pleased we are with the start CCC has gotten off to in 2022.
We are raising our outlook for 2022 and are on track to deliver another year of double digit revenue growth and strong EBITDA margins.
We are seeing strong adoption across our product portfolio with both existing and newly introduced solutions.
We also continue to expand and strengthen our ecosystem.
I believe the investments, we're making in talent innovation and service delivery will help us solve critical problems for our customers as well as deliver.
System growth for years to come.
I wanted to take this opportunity to thank the CCC team for their incredible dedication.
And to our customers.
The tremendous trust they are placing us every single day.
I will now turn the call over to Brian .
Who will walk you through our results.
Thanks to cash.
As <unk> outlined we feel like we're in a strong position to deliver on the industry's vision for straight through processing and to deliver exceptional value to our client base.
In turn this will drive durable long term growth and opportunities to scale with both the more mature products like casualty and the more recent launches like diagnostics total life care.
Payments and other solutions. Thank you Kash talked about today.
Our existing products provide a long runway for growth.
In that if we sold these solutions to our eligible customers we'd be roughly three times the size we are today.
And we also believe these newer solutions that have recently launched add more than another $1 billion in future market opportunity.
As the industry continues to digitized there will be many more organic and inorganic opportunities ahead for us.
Now, let me turn to our first quarter 2022 results and provide guidance for the second quarter and the full year of 2022.
Total revenue for the first quarter was $186 8 million up 18% from the prior year period.
Our growth is being driven primarily by cross selling upsell into our installed client base, including the large expansion deals that we've talked about over the last couple of quarters, which contributed approximately five points of growth.
Also the broad based adoption of our new digital solutions, such as mobile AI and engage.
As well as growth from new logos, which is primarily driven from our repair facilities and part suppliers.
Turning to our key metrics software gross dollar retention or GTR captures the amount of revenue retained from our client base compared to the prior year period in Q1 'twenty two it was 99% up one point from historical levels.
We believe our software GDR reflects the value, we provide our customers and the stickiness of the network effect.
For <unk> as a core tenant of our predictable and resilient revenue model.
Software net dollar retention or <unk> captures the amount of cross sell and up sell from our existing customers compared to the prior year period as.
As well as volume movements within our auto property damage client base and.
In Q1, 2022 software MBR was 114%.
As expected software MDI remained above our historical range.
Consistently strong MBR performance in recent quarters reflects the success, we've had with our cross sell opportunities across our customer base.
Including the large expansion deals signed in the second half of 2021.
<unk> is a core driver in our business and we have excellent opportunities to execute against this for the foreseeable future.
Now to review the income statement in more detail.
As a reminder, unless otherwise noted all metrics are non-GAAP and we've provided a reconciliation of GAAP to non-GAAP in our press release.
Adjusted gross profit in the quarter was $145 1 million with adjusted gross profit margin of 78% <unk>.
Compared to an adjusted gross profit margin of 76% in the first quarter last year.
Adjusted gross profit margin benefited from the continued scale in our business and the efficient multi tenant cloud platform.
This was slightly below the 79% adjusted gross profit margin reported last quarter, which benefited our point from the $4 million of nonrecurring revenue we spoke about.
As we turn to our operating expenses.
Adjusted operating expenses were $78 2 million, which grew 12% year over year.
Growth in these expenses were largely driven by head count additions public company cost and the increases in discretionary spend as these expenses continue to normalize.
On the head Count addition point.
We are pleased with the progress made to advance our operational capabilities by adding key positions across product management product development partnerships and M&A.
We feel like we are in a strong position to continue delivering on building innovation into the market.
And execute on our strategic agenda.
Adjusted EBITDA for the quarter was $73 $7 million with a 39% adjusted EBITDA margin.
Adjusted EBITDA grew 33% year over year and margins improved more than 400 basis points compared to prior year.
Margin progression is being driven from scaling revenue flowing through to EBITDA.
At high rates as we have an efficient and scalable business model.
Now turning to the balance sheet and cash flow, we ended the quarter with $195 million in cash and cash equivalents.
$798 million of debt at the ended the quarter. Our net leverage was approximately two two times adjusted EBITDA.
Free cash flow in the quarter was $32 6 million compared to $33 5 million in the prior year period.
Looking at cash flow on an unlevered basis year to date, we converted approximately 51% of adjusted EBITDA into Unlevered free cash flow.
This quarter included the impact of our annual incentive plan payments and finishing the build out of our new headquarters adjusting for these items and on a normalized basis cash conversion would have been above our historical position in the low to mid sixties.
Subsequent to the end of the quarter, we successfully completed a secondary stock offering of 20 million shares by our selling shareholders.
<unk> did not receive any proceeds from this offering.
Now I'd like to finish with guidance beginning in the second quarter. We expect total revenue of 189 five to 191 5 million. This represents 14% year over year growth at the midpoint, we expect adjusted EBITDA between <unk>.
Nine to 71 million, which represents a 36% adjusted EBITDA margin at the midpoint.
For the full year 2022, we expect revenue of $763 million to $771 million, which is 11% year over year growth.
At the midpoint.
We expect adjusted EBITDA between $288 million to $294 million, which represents a 38% adjusted EBITDA margin at the midpoint.
There are a few things to keep in mind as you think about our guidance for 2022.
Our revenue guidance reflects our confidence in the underlying momentum in the business.
We will continue to see growth shift more to cross selling upsell versus new logos, reflecting our growing solution portfolio.
And we feel really good about the strategic position and long term opportunities with straight through processing.
Payments and are safe keep acquisition. However, these will not be meaningful contributors to growth in 2022.
Also keep in mind in the second half of this year, we will be lapping the large expansion deals signed in the second half of 2021 as well as the $4 million of nonrecurring revenue recorded in the fourth quarter of last year.
In terms of profitability. The second quarter includes the impact of cost phasing and our annual industry conference.
And we expect to see the impact of continued hiring in key positions across product management.
In product development to support our growth and innovation roadmap.
We do expect profitability to grow sequentially each quarter in the back half of the year.
To wrap up.
<unk> got off to a strong start in 2022 and is well positioned to deliver on our financial and operational targets for the year.
The need for Digitization across the P&C insurance economy continues to accelerate and CCC is well positioned to drive durable revenue growth in the near and long term.
We are confident that.
As we continue to execute on our strategic priorities, we will generate significant value for both our customers and our shareholders.
With that operator, we're now ready to take questions. Thank you.
Thank you Sir.
At this time, we will be conducting a question and answer session.
He would like to ask the question Keith I'll start and then one on your telephone keypad.
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Our first question is from bending Deca from William Blair.
Hey, guys I appreciate you taking the question and nice job during the quarter, maybe I guess first for you. The cash as you think about some of the inflation dynamics that are impacting some of your repair facility customers insurance carriers, having to navigate and manage that profitability headwinds.
<unk> talked a lot about kind of those key platform adjacencies, how much has that need for better input cost visibility right. The repair dynamics driven accelerated demand youre seeing.
Around the platform expansion and then some of those earlier stage tools like diagnostics and total loss that you've talked about as well.
Yes.
Thanks.
A couple of things right.
The need for precision.
To really manage.
Repairs to manage claims is an incredible need to manage precision and to really understand how the supply chain is developing so we've had tons of requests from customers across our customer base to really understand the analytics the data and we publish a crash course.
And then of course for each customer we provide unique insights into what is going on so I would say that.
Inflation has clearly been running heavy.
So with the shortage of labor. So all of these things have really made these mission critical solutions that you can deploy and get very quick ROI.
Clearly important so I would not say that.
It has accelerated anything in particular, but the long term secular demand for the products and solutions. We have continues to be emphasized pretty heavily.
What we're seeing.
Yes, I think Thats fair and obviously, adding that visibility is the key value driver at the end of the day.
I guess, if you think about the evolution as well of your overall ecosystem, you've got a lot of the key constituents. Today. There's also a lot of white space going out there the lender dynamically moana on our medical claims side that you talked about as well.
There is this there's multiple counterparties involved here right. So how do you think about the progression of that broader platform expansion and the opportunity to drive value.
And competitive strength by adding more components of that ecosystem over time as well.
Yes, I would say you have to think about it and really a couple of dimensions. So when you look at our overall macro view our overall macro view is our vision of STP, our straight through processing. So from the moment that <unk> happen and then and runs all the way through.
Deciding what it said total repair and running all the way through to the end and then when you look at specific components. Each of these has multiple ecosystems. So when you look at repair <unk> got repair facilities, you got parts providers, you've got insurers. When you look at casualty medical providers got insurers, we've got other parties.
When you look at total losses, we've got banks lien holders. So what we are doing is our vision of STP really involves stitching together a seamless experience.
Across all of these different ecosystems, that's where the power of the network and frankly year stuff, having delivered solutions to our customers really comes out.
Hope that answers your question.
Yeah, absolutely that's fantastic color, thanks, guys and congrats on the quarter.
Thank you.
Thank you. The next question, we have between Chris Moore from CJS Securities.
Hey, good afternoon, guys. Thanks for taking a couple of questions.
It was very interesting discussion.
Casualty had no idea that.
Insurers spent that much.
Sure.
Are there any unique challenges within the penetration that you're seeking there that that could be helped.
Through M&A.
We actually did the M&A a few years ago.
And we acquired a company years ago, and we have actually been investing significantly in the platform over the last several years and have a number of customers again penetration as I pointed out is significantly less than it is in auto physical damage.
But we are we have several top 20 carriers and we have a number of carriers, but significantly less penetration and I think as I pointed out we bought <unk>.
Added a couple of customers during the quarter as well.
And again.
Stitching all of this together into a seamless experience with straight through processing artificial intelligence all of these capabilities becomes super important.
So yes, we did see every day, a few years back and as that.
From where you are now is it.
Kind of a couple years before it's a meaningful contributor to revenue.
Today, it's about roughly 10% of our revenue okay.
Got it.
Yes. They are underrepresented part I guess it was just in terms of of the potential markets.
Exactly.
And just.
Maybe a little bit more on CCC I know you've talked about the first carrier.
Are there any other kind of specific milestones that you could point to for the balance of 'twenty two into 'twenty three that we should be thinking about.
We have built the business to be QUADRA resilient to any particular event.
So if you look at.
You look at our customer base right. We've got insurers, we got punched providers, who got repair facilities and I'm, assuming so we've got a broad mix of folks and we are bringing.
And various products have different.
Milestones, but are you talking specifically about payments yes.
Yes.
Okay on payments in particular, yes.
Yes, we are actually working through four use cases right. So last year. We set our first goal is to build the get the payments infrastructure in place. We did that second we said we are going to work with early customers to refine use cases, and we've been doing that and then third we said look we're going to get our first customer on board and we.
What we just did and we are continuing to work with a number of cases.
Again payments as an important component so I wouldn't call out any particular big macro.
No.
Particular point.
As you pointed out in the call, we do not expect payments to contribute in any meaningful way in 'twenty two.
Alright understood helpful. I'll leave it there thanks guys.
Thanks, Chris.
Thank you ladies and gentlemen, just a reminder, if you would like to ask a question Peter Scott and then one now.
Next question, we have not.
From Evercore ISI. Please go ahead.
Okay.
Hi, guys. This is actually pay to Berkeley on for Kirk.
So first of all I guess.
You guys are doing a lot of innovation and you talked a little bit about diagnostics today.
I'm curious last quarter, you were testing the safety auto a bit.
And kind of excitement about all the subrogation capability and how that kind of open up more of the P&C insurance economy outcome outside of auto So I'm just curious.
Some of that outside of auto something you guys are thinking about in terms of future product for your roadmap, even if not near term even if later down the line.
Yes, exactly as you pointed out.
Subrogation is one of those solutions that extend well beyond auto subrogation existing property exists and workers.
Across a range of solutions payments solutions also extends outside of auto as the needs to make payments while outside of auto. So this is what we referred to us when we say horizontal solutions. Those are two solutions in particular that extend beyond auto.
And Brian maybe one just quick one for you.
Yes.
Last quarter, you called out hiring maybe being a little bit behind schedule and that is helping driving some of that margin expansion and it sounds like hiring spending pretty nicely in the quarter now this quarter. So I'm just curious any more color how it's selling in the quarter and then how you guys are thinking about hiring for the rest of the year here.
Yes.
Hey, Peter Yes, so we have been making progress across our our plans. So we brought in had around product development around product management. We also highlighted that we've invested in some of our partnership capabilities.
So we're making additions we will continue to do that.
As we go through the year.
We are very focused on balancing investment against our strategic priorities at the same time delivering against our long term margin goals as well. So those are the things we're really focused on balancing but we feel good about the hires that we've made in our operational capabilities.
<unk>.
As we go forward.
Very helpful. Appreciate it.
Great. Thanks.
Thank you. The next question inherently can campaign a portion.
Jack.
Hey, Thanks for taking the question. This is Jake title men on for Gabriela.
<unk> is obviously a key part of the long term vision, you announced estimate STP recently can you comment on some early success. There and then maybe talk about what are the what are the other key technical challenges and innovations that need to be solved to get you closer to a full STP solution down the road.
Sure.
Exactly as you pointed out.
Estimate STP is a component of our overall STP vision and I'd argue.
One of the hardest things to that SPP vision.
To pull off.
We have.
Whats been exciting is we announced.
Estimate STP I think it was around October of last year.
And literally six seven months since then.
Got eight significant customers up and running an estimate STP and this involves very sophisticated AI very sophisticated workflows very sophisticated tuning of the AI parameters.
And that's also giving us a lot of credibility for STP overall bidding to conversations with our team one yesterday and one today with customers exactly around this topic.
So estimate STB is going well.
Fairly quick adoption.
Has significant ROI and fairly quick ROI and it's also showing the power of how it became how STP in general as it extends across the different components of the claims that we talked about.
So huge impact so yes, we are investing many of the people that we're hiring recruiting that Brian talked about are all around this ambition.
Thanks for the color and just for my follow up you've talked about growth shifting more toward cross sell and up sell versus new logos. What are the implications for your unit economics and your margins is it fair to assume that the cost of customer acquisition on cross sell is lower than on new logos.
Yeah happy to take that.
Yes, so we have highlighted this shift.
Go back and just to give us a few data points. So we historically had about two thirds of the growth was driven firm cross sell up sell and about a third from new logos and we've highlighted that that will shift and it will look like more like 80% of the growth coming from cross sell upsell and 20% new logos.
We started to see that play out.
Half of last year was more in the 70 30.
Shift and it's going to continue to move towards that.
We do see the opportunity with margin expansion.
With the ability to sell into our existing base and the efficiency that drives so we do see that as being a tailwind to margin progression and that's part of what gives us confidence as we look towards the long term margins that we've highlighted I'm moving from where we are now to the mid <unk>.
<unk> over time.
Yes. It absolutely is a helpful tailwind that said today, we don't spend a lot of money on customer acquisitions, we have a very efficient sales organization and have coverage across our customer groups.
Although we see efficiency with the cross sell is not as of today, we are spending significant dollars on customer acquisition.
Very clear thank you very much for the color.
Absolutely.
Okay.
Thank you ladies and gentlemen, just a final reminder, if you would like to ask a question. Please press star and then one now.
The next question, we have is from Guy casino.
Barrington research.
Hey, good afternoon, everyone.
Eric.
Full of questions here first of all on the payments business that you saw and you said you signed one customer right detached you've got one out there that I assume is working kind of in a beta test with you now.
No. This is a signed customer so okay. So we have a number of customers that we're working with in the early stages.
So the customer that converted over who is working on the implementation.
And this would be an insurance carrier.
Yes.
Okay.
So in your mind as you as you implement this I mean, how quickly once you implement this in its out in the market do you see it kind of a cascading effect, where something that it becomes maybe I might have it too it's necessary for me to have it.
As with many of our other solutions right we've been in this business.
Think you would notice I haven't known us for a long time and I look back over the last 20 plus years of driving this growth is.
Is through new solutions.
We're very focused on delivering a great experience when you deliver a great experience in their first product.
That is really really and customer and it really delivers an ROI for our customer.
That really has a huge impact on how quickly things get adopted.
I am not going to make any predictions Gary on time and speed, but what we are focused inordinately is delivering a great experience.
Okay Alright.
And then just a couple of more questions here.
Was the.
Software MBR for last year, Brian do you have that handy.
Yes. So we ended last year at 115, but if you look across the year of last year it averaged around 113.
Average of the four quarters of last year, while I'm talking about for Q1 last year was that a.
Should have been a little bit more precise you have the Q1 of last year was 106, okay.
Okay.
That's fine and then in terms of things like engage in electronic parts ordering.
I think you said about 30% of your rooftops have got engaged and 40% increase last less in Q4 last year.
Electronic parts ordering.
Could you give us an idea of how much more uptake there was in engage.
From the repair shops, as well as with electronic parts ordering.
Yes, I mean, we made progress on both fronts. So we continue to sign part suppliers.
And we're seeing growth both from new rooftops part suppliers as.
As well as electronic ordering just increasing.
As a percent of overall, what parts are making it on.
Repair order and we're seeing good progress on engage and the number of rooftops that we have on engagement.
The key drivers when we look at our MTR.
And see the strength is engage in the other digital solutions. So mobile AI engage some of the early adoption on the total loss care portfolio those are our core drivers.
Of our MBR performance.
Hey, there.
One other thing sorry, yes.
The one other thing I'd point out is when you look at engage many of our customers have integrated it into their websites and the likes so now as customers are trying to book appointments and tried to give estimates. It is super helpful to that process. So that word is also spreading pretty broadly so are we.
Expect that.
Gage will continue to grow over the next couple.
Yes for sure.
Thanks, a lot guys.
Great. Thanks, Gary.
Thank you.
And gentlemen, we at least.
At the end of our question on consumption and I would like to turn the call back to Ken Sherman for closing remarks.
Well, thanks, everybody for joining us and again as we've said before we believe the industry is in the early stages of Digitization, we have terrific credibility with our customers having delivered a lot of solutions, we're investing in innovation, that's being really well received.
And I want to wrap up by saying thanks to all the CCC years, who make this possible day in day out thanks, very much to our customers who place their trust in US every day and also want to thank our investors.
For continuing to be a key part of what we do.
Look forward to.
Addressing the next quarter.
Thank you Sir.
Ladies and gentlemen that concludes today's conference. Thank you for joining US you may now disconnect your lines.