PR Newswire | Aug 5, 2021 07:01AM EDT

08/05 06:00 CDT

Black Knight Reports Second Quarter 2021 Financial Results JACKSONVILLE, Fla., Aug. 5, 2021

JACKSONVILLE, Fla., Aug. 5, 2021 /PRNewswire/ -- Black Knight, Inc. (NYSE: BKI), a leading provider of software, data and analytics solutions to the mortgage and consumer loan, real estate and capital markets verticals, today announced unaudited financial results for the second quarter of 2021, as compared to the prior year quarter.

Second Quarter 2021 Highlights:

* Revenues of $361.3 million, an increase of 23%; Organic revenue growth of 11% * Net earnings attributable to Black Knight of $39.7 million, an increase of 2%; Diluted EPS of $0.25 compared to $0.26; Net earnings margin of 8.9% compared to 13.3% * Adjusted EBITDA of $177.5 million, an increase of 21%; Adjusted EBITDA margin was 49.1% compared to 50.2% * Adjusted net earnings of $88.6 million, an increase of 13%; Adjusted EPS of $0.57, an increase of 10%

Second Quarter 2021 Segment Highlights:

Software Solutions

* Revenues of $305.4 million, an increase of 25%; Organic revenue growth of 11% * EBITDA of $174.8 million, an increase of 20%; EBITDA margin of 57.2% compared to 59.6%

Data and Analytics

* Revenues of $55.9 million, an increase of 16%; Organic revenue growth of 14% * EBITDA of $20.8 million, an increase of 29%; EBITDA margin of 37.2% compared to 33.4%

Commentary:

Black Knight Chairman and Chief Executive Officer Anthony Jabbour said, "We are pleased with our very strong results in the second quarter, where we delivered Organic revenue growth of 11% and Adjusted EBITDA growth of 21%. These results reflect the consistent execution of our strategy to drive organic growth through the addition of new clients, the expansion of relationships with existing clients and the delivery of new innovative solutions."

Other Highlights:

* On May 17, 2021, we completed the acquisition of eMBS, Inc. ("eMBS"), a leading data and analytics aggregator for residential mortgage-backed securities. eMBS is reported within our Data and Analytics segment. * Dun & Bradstreet Holdings, Inc. ("DNB") investment: We own approximately 54.8 million shares of DNB common stock, which had a fair value of approximately $1.2 billion before income taxes (approximately $1.0 billion after income taxes) based on DNB's closing share price as of June 30, 2021. * As of June 30, 2021, we had cash and cash equivalents of $88.7 million, debt of $2,235.3 million and available capacity of $902.0 million on our revolving credit facility. * On July 7, 2021, we completed the acquisition of TOMN Holdings, Inc. ("Top of Mind"), developer of SurefireSM, a leading customer relationship management and marketing automation system for the mortgage industry. Top of Mind will be a part of Origination Software within our Software Solutions segment.

Jabbour continued, "With our strong second quarter performance, our confidence in the outlook for the remainder of the year and the effect of the Top of Mind and eMBS acquisitions, we are raising our full year guidance again. We now expect full year revenue in the range of $1,447 million to $1,463 million, Adjusted EBITDA in the range of $704 million to $716 million and Adjusted EPS in the range of $2.23 to $2.29."

Business Outlook

The following forward-looking statements reflect Black Knight's expectations as of today's date. Given the number of risk factors, uncertainties and assumptions discussed below, actual results may differ materially. Black Knight does not intend to update its forward-looking statements until its next quarterly results announcement, other than in publicly available statements.

Black Knight's updated full year 2021 outlook is as follows:



2020 2021 Growth

ActualLow High Low High

August 5, 2021 outlook (Updated)

Revenues $1,239 $1,447$1,46317%18%

Organic revenue growth 8 %9 %

Adjusted EBITDA $610 $704 $716 15%17%

Adjusted EPS $2.11 $2.23 $2.29 6 %9 %



May 6, 2021 outlook (Prior)

Revenues $1,239 $1,407$1,42814%15%

Organic revenue growth 6 %8 %

Adjusted EBITDA $610 $695 $711 14%17%

Adjusted EPS $2.11 $2.16 $2.24 2 %6 %

Definitions of non-GAAP financial measures and the reconciliations to the most directly comparable GAAP measures are provided in subsequent sections of the press release narrative and supplemental schedules. Black Knight has not provided a reconciliation of forward-looking Adjusted EBITDA and Adjusted EPS, including certain components of the forward-looking reconciliation, to the most directly comparable GAAP financial measures, due primarily to variability and difficulty in making accurate forecasts and projections of non-operating matters that may arise, as not all of the information necessary for a quantitative reconciliation is available to Black Knight without unreasonable effort. For the same reasons, Black Knight is unable to address the probable significance of the information.

Earnings Conference Call and Audio Webcast

Black Knight will host a conference call to discuss the second quarter 2021 financial results on August 5, 2021, at 8:30 a.m. ET. The conference call can be accessed live over the phone by dialing (855) 327-6838, or for international callers (604) 235-2082. A replay will be available from 11:30 a.m. ET on August 5, 2021, through August 12, 2021, by dialing (844) 512-2921, or for international callers (412) 317-6671. The replay passcode will be 10015610.

The call will also be webcast live from Black Knight's investor relations website at https://investor.blackknightinc.com. Following completion of the call, a recorded replay of the webcast will be available on the website.

About Black Knight

Black Knight, Inc. (NYSE:BKI) is an award-winning software, data and analytics company that delivers innovation in the mortgage lending and servicing and real estate industries, as well as the capital and secondary markets. Businesses leverage our robust, integrated solutions across the entire homeownership life cycle to help retain existing customers, gain new customers, mitigate risk and operate more effectively.

Our clients rely on our proven, comprehensive, scalable products and our unwavering commitment to delivering superior client support to achieve their strategic goals and better serve their customers. For more information on Black Knight, please visit www.blackknightinc.com.

Non-GAAP Financial Measures

This earnings release contains non-GAAP financial measures, including Adjusted revenues, Organic revenue growth, Adjusted EBITDA, Adjusted EBITDA margin, Adjusted net earnings and Adjusted EPS. These are important financial measures for us but are not financial measures as defined by generally accepted accounting principles ("GAAP"). The presentation of this financial information is not intended to be considered in isolation of or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP.

We use these non-GAAP financial measures for financial and operational decision making and as a means to evaluate period-to-period comparisons. We believe these measures provide useful information about operating results, enhance the overall understanding of past financial performance and future prospects and allow for greater transparency with respect to key metrics used by management in its financial and operational decision making, including determining a portion of executive compensation. We also present these non-GAAP financial measures because we believe investors, analysts and rating agencies consider them useful in measuring our ability to meet our debt service obligations. By disclosing these non-GAAP financial measures, we believe we offer investors a greater understanding of, and an enhanced level of transparency into, the means by which our management operates the company.

These non-GAAP financial measures are not measures presented in accordance with GAAP, and our use of these terms may vary from that of others in our industry. These non-GAAP financial measures should not be considered as an alternative to revenues, net earnings, net earnings per share, net earnings margin or any other measures derived in accordance with GAAP as measures of operating performance or liquidity. Reconciliations of these non-GAAP financial measures to the most directly comparable GAAP financial measures are presented in the attached schedules.

Revenues, EBITDA and EBITDA margin for the Software Solutions and Data and Analytics segments are presented in conformity with Accounting Standards Codification Topic 280, Segment Reporting. These measures are reported to the chief operating decision maker for purposes of making decisions about allocating resources to the segments and assessing their performance. For these reasons, these measures are excluded from the definition of non-GAAP financial measures under the Securities and Exchange Commission's ("SEC") Regulation G and Item 10(e) of Regulation S-K.

Adjusted revenues - We define Adjusted revenues as Revenues adjusted to include the revenues that were not recorded by Black Knight during the periods presented due to the deferred revenue purchase accounting adjustment recorded in accordance with GAAP. These adjustments are reflected in Corporate and Other.

Organic revenue growth - We define Organic revenue growth as Adjusted revenues, as defined above, for the current period compared to an adjusted revenue base for the prior period, which is adjusted to add pre-acquisition revenues of acquired businesses for the portion of the prior year matching the portion of the current year that we owned the acquired businesses.

Adjusted EBITDA - We define Adjusted EBITDA as Net earnings attributable to Black Knight, with adjustments to reflect the addition or elimination of certain statement of earnings items including, but not limited to:

* Depreciation and amortization; * Impairment charges; * Interest expense, net; * Income tax expense; * Other expense (income), net; * Equity in losses (earnings) of unconsolidated affiliates, net of tax; * (Gains) losses on sale of investments in unconsolidated affiliate, net of tax; * Net earnings (losses) attributable to redeemable noncontrolling interests; * deferred revenue purchase accounting adjustment; * equity-based compensation, including certain related payroll taxes; * costs associated with debt and/or equity offerings; * acquisition-related costs, including costs pursuant to purchase agreements; and * costs associated with expense reduction initiatives.

These adjustments are reflected in Corporate and Other.

Adjusted EBITDA margin - Adjusted EBITDA margin is calculated by dividing Adjusted EBITDA by Adjusted revenues.

Adjusted net earnings - We define Adjusted net earnings as Net earnings attributable to Black Knight with adjustments to reflect the addition or elimination of certain statement of earnings items including, but not limited to:

* equity in losses (earnings) of unconsolidated affiliates, net of tax; * (gains) losses on sale of investments in unconsolidated affiliate, net of tax; * the net incremental depreciation and amortization adjustments associated with the application of purchase accounting; * deferred revenue purchase accounting adjustment; * equity-based compensation, including certain related payroll taxes; * costs associated with debt and/or equity offerings; * acquisition-related costs, including costs pursuant to purchase agreements; * costs associated with expense reduction initiatives; * costs and settlement (gains) losses associated with significant legal matters; * adjustment for income tax expense primarily related to the tax effect of the non-GAAP adjustments; and * adjustment for redeemable noncontrolling interests primarily related to the effect of the non-GAAP adjustments.

Adjusted EPS - Adjusted EPS is calculated by dividing Adjusted net earnings by the diluted weighted average shares of common stock outstanding.

Forward-Looking Statements

This press release contains forward-looking statements that involve a number of risks and uncertainties. Statements that are not historical facts, including statements regarding expectations, hopes, intentions or strategies regarding the future are forward-looking statements. Forward-looking statements are based on Black Knight management's beliefs, as well as assumptions made by, and information currently available to, them. Because such statements are based on expectations as to future financial and operating results and are not statements of fact, actual results may differ materially from those projected. Black Knight undertakes no obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise.

The risks and uncertainties that forward-looking statements are subject to include, but are not limited to:

* changes in general economic, business, regulatory and political conditions, including those resulting from pandemics such as COVID-19, particularly as they affect foreclosures and the mortgage industry; * the outbreak of COVID-19 and measures to reduce its spread, including the effect of governmental or voluntary actions such as business shutdowns and stay-at-home orders; * security breaches against our information systems or breaches involving our third-party vendors; * our ability to maintain and grow our relationships with our clients; * our ability to comply with or changes to the laws, rules and regulations that affect our and our clients' businesses; * our ability to adapt our solutions to technological changes or evolving industry standards or to achieve our growth strategies; * our ability to protect our proprietary software and information rights; * the effect of any potential defects, development delays, installation difficulties or system failures on our business and reputation; * risks associated with the availability of data; * the effects of our existing leverage on our ability to make acquisitions and invest in our business; * our ability to successfully consummate, integrate and achieve the intended benefits of acquisitions; * risks associated with our investment in DNB and integrating and achieving the intended benefits of the acquisition of Optimal Blue, LLC ("Optimal Blue"); and * other risks and uncertainties detailed in the "Statement Regarding Forward-Looking Information," "Risk Factors" and other sections of our Annual Report on Form 10-K for the year ended December 31, 2020 and other filings with the SEC.

BLACK KNIGHT, INC.

Consolidated Balance Sheets

(In millions)

(Unaudited)





June 30, 2021December 31, 2020

ASSETS

Current assets:

Cash and cash equivalents $88.7 $ 34.7

Trade receivables, net 183.6 182.2

Prepaid expenses and other current assets 86.3 70.4

Receivables from related parties 10.5 -

Total current assets 369.1 287.3

Property and equipment, net 157.5 163.1

Computer software, net 496.5 498.3

Other intangible assets, net 624.6 692.3

Goodwill 3,649.6 3,613.4

Investments in unconsolidated affiliates 475.8 470.5

Deferred contract costs, net 179.6 172.3

Other non-current assets 213.2 193.3

Total assets $6,165.9 $ 6,090.5

LIABILITIES AND EQUITY

Current liabilities:

Trade accounts payable and other accrued $73.8 $ 88.1 liabilities

Accrued compensation and benefits 91.0 79.3

Current portion of debt 19.0 73.0

Deferred revenues 68.7 50.9

Total current liabilities 252.5 291.3

Deferred revenues 82.7 92.7

Deferred income taxes 282.1 284.0

Long-term debt, net of current portion 2,216.3 2,121.9

Other non-current liabilities 90.1 94.9

Total liabilities 2,923.7 2,884.8



Redeemable noncontrolling interests 578.0 578.0



Equity:

Additional paid-in capital 2,021.0 2,053.7

Retained earnings 852.4 757.4

Accumulated other comprehensive loss (32.6) (38.8)

Treasury stock, at cost (176.6) (144.6)

Total shareholders' equity 2,664.2 2,627.7

Total liabilities, redeemable noncontrolling interests and shareholders' $6,165.9 $ 6,090.5 equity

BLACK KNIGHT, INC.

Consolidated Statements of Earnings

(In millions, except per share data)

(Unaudited)



Three months ended June 30, Six months ended June 30,

2021 2020 2021 2020

Revenues $361.3 $293.1 $711.0 $583.8

Expenses:

Operating expenses 197.0 155.5 383.2 317.9

Depreciation and 90.4 58.6 178.2 116.3 amortization

Transition and 4.3 2.5 12.2 4.9 integration costs

Total expenses 291.7 216.6 573.6 439.1

Operating income 69.6 76.5 137.4 144.7

Other income and expense:

Interest expense, (20.9) (13.0) (41.2) (27.7) net

Other (expense) (1.0) 18.8 (4.2) 18.0 income, net

Total other (expense) income, (21.9) 5.8 (45.4) (9.7) net

Earnings before income taxes and equity in (losses) 47.7 82.3 92.0 135.0 earnings of unconsolidated affiliates

Income tax expense 10.5 17.2 15.7 25.4

Earnings before equity in (losses) earnings of 37.2 65.1 76.3 109.6 unconsolidated affiliates

Equity in (losses) earnings of unconsolidated (5.0) (26.0) 1.4 (20.4) affiliates, net of tax

Net earnings 32.2 39.1 77.7 89.2

Net losses attributable to redeemable 7.5 - 16.1 - noncontrolling interests

Net earnings attributable to $39.7 $39.1 $93.8 $89.2 Black Knight



Net earnings per share attributable to Black Knight shareholders:

Basic $0.26 $0.26 $0.60 $0.60

Diluted ^(1) $0.25 $0.26 $0.60 $0.60

Weighted average shares of common stock outstanding:

Basic 155.4 149.2 155.5 148.6

Diluted ^(1) 155.7 150.0 155.8 149.3

For the periods presented, dilutive securities include time-based and(1) performance-based unvested restricted stock awards for which performance metrics have been achieved.

BLACK KNIGHT, INC.

Consolidated Statements of Cash Flows

(In millions)

(Unaudited)



Six months ended June 30,

2021 2020

Cash flows from operating activities:

Net earnings $77.7 $89.2

Adjustments to reconcile net earnings to net cash provided by operating activities:

Depreciation and amortization 178.2 116.3

Amortization of debt issuance costs and original 2.0 1.4 issue discount

Loss on extinguishment of debt 2.5 -

Deferred income taxes, net (3.9) 0.9

Equity in (earnings) losses of unconsolidated (1.4) 20.4 affiliates, net of tax

Equity-based compensation 22.5 20.2

Changes in assets and liabilities, net of acquired assets and liabilities:

Trade receivables, including receivables from (10.7) 4.9 related parties

Prepaid expenses and other assets (36.8) (13.9)

Deferred contract costs (24.1) (26.0)

Deferred revenues 6.4 (10.2)

Trade accounts payable and other liabilities (13.2) (7.9)

Net cash provided by operating activities 199.2 195.3

Cash flows from investing activities:

Additions to property and equipment (11.5) (12.6)

Additions to computer software (45.4) (38.2)

Business acquisitions, net of cash acquired (48.3) (50.4)

Asset acquisitions (10.0) (15.0)

Other investing activities (1.2) 8.4

Net cash used in investing activities (116.4) (107.8)

Cash flows from financing activities:

Net proceeds from issuance of common stock, - 484.6 before offering expenses

Costs directly associated with issuance of common - (0.4) stock

Revolver borrowings 260.3 266.6

Revolver payments (210.0) (576.6)

Term loan borrowings 1.6 -

Term loan payments - (23.4)

Purchases of treasury stock (46.7) -

Tax withholding payments for restricted share (24.4) (19.7) vesting

Finance lease payments (2.0) (5.8)

Debt issuance costs paid (7.6) -

Net cash (used in) provided by financing (28.8) 125.3 activities

Net increase in cash and cash equivalents 54.0 212.8

Cash and cash equivalents, beginning of period 34.7 15.4

Cash and cash equivalents, end of period $88.7 $228.2

Supplemental cash flow information:

Interest paid, net $(40.0) $(26.1)

Income taxes paid, net $(42.7) $(5.4)

BLACK KNIGHT, INC.

Segment Information

(In millions)

(Unaudited)



Three months ended June 30, 2021

Software Data and Corporate

SolutionsAnalyticsand Other Total

Revenues $305.4 $55.9 $- (1)$361.3

Expenses:

Operating expenses 130.6 35.1 31.3 (2) 197.0

Transition and integration - - 4.3 (3) 4.3 costs

EBITDA 174.8 20.8 (35.6) 160.0

Depreciation and amortization 33.2 3.7 53.5 (4) 90.4

Operating income (loss) 141.6 17.1 (89.1) 69.6

Interest expense, net (20.9)

Other expense, net (1.0)

Earnings before income taxes and equity in losses of 47.7 unconsolidated affiliates

Income tax expense 10.5

Earnings before equity in losses of unconsolidated 37.2 affiliates

Equity in losses of unconsolidated affiliates, net (5.0) of tax

Net earnings 32.2

Net losses attributable to redeemable noncontrolling 7.5 interests

Net earnings attributable to $39.7 Black Knight



Three months ended June 30, 2020

Software Data and Corporate

SolutionsAnalyticsand Other Total

Revenues $245.1 $48.2 $(0.2) (1)$293.1

Expenses:

Operating expenses 98.9 32.1 24.5 (2) 155.5

Transition and integration - - 2.5 (3) 2.5 costs

EBITDA 146.2 16.1 (27.2) 135.1

Depreciation and amortization 30.2 3.8 24.6 (4) 58.6

Operating income (loss) 116.0 12.3 (51.8) 76.5

Interest expense, net (13.0)

Other income, net 18.8

Earnings before income taxes and equity in losses of 82.3 unconsolidated affiliates

Income tax expense 17.2

Earnings before equity in losses of unconsolidated 65.1 affiliates

Equity in losses of unconsolidated affiliates, net (26.0)of tax

Net earnings $39.1

BLACK KNIGHT, INC.

Segment Information (Continued)

(In millions)

(Unaudited)



Six months ended June 30, 2021

Software Data and Corporate and

SolutionsAnalyticsOther Total

Revenues $601.2 $109.8 $- (1)$711.0

Expenses:

Operating expenses 255.5 69.3 58.4 (2) 383.2

Transition and integration - - 12.2 (3) 12.2 costs

EBITDA 345.7 40.5 (70.6) 315.6

Depreciation and 64.4 7.5 106.3 (4) 178.2 amortization

Operating income (loss) 281.3 33.0 (176.9) 137.4

Interest expense, net (41.2)

Other expense, net (4.2)

Earnings before income taxes and equity in 92.0 earnings of unconsolidated affiliates

Income tax expense 15.7

Earnings before equity in earnings of unconsolidated 76.3 affiliates

Equity in earnings of unconsolidated affiliates, 1.4 net of tax

Net earnings 77.7

Net losses attributable to redeemable noncontrolling 16.1 interests

Net earnings attributable $93.8 to Black Knight



Six months ended June 30, 2020

Software Data and Corporate and

SolutionsAnalyticsOther Total

Revenues $489.8 $94.3 $(0.3) (1)$583.8

Expenses:

Operating expenses 204.2 63.6 50.1 (2) 317.9

Transition and integration - - 4.9 (3) 4.9 costs

EBITDA 285.6 30.7 (55.3) 261.0

Depreciation and 60.5 7.8 48.0 (4) 116.3 amortization

Operating income (loss) 225.1 22.9 (103.3) 144.7

Interest expense, net (27.7)

Other income, net 18.0

Earnings before income taxes and equity in losses 135.0 of unconsolidated affiliates

Income tax expense 25.4

Earnings before equity in losses of unconsolidated 109.6 affiliates

Equity in losses of unconsolidated affiliates, (20.4)net of tax

Net earnings $89.2

(1) Revenues for Corporate and Other represent deferred revenue purchase accounting adjustments recorded in accordance with GAAP.

Operating expenses for Corporate and Other includes equity-based compensation, including certain related payroll taxes, of $13.2 million(2) and $9.5 million for the three months ended June 30, 2021 and 2020, respectively, and $23.7 million and $21.2 million for the six months ended June 30, 2021 and 2020, respectively.

(3) Transition and integration costs primarily consists of costs associated with acquisitions.

Depreciation and amortization for Corporate and Other primarily represents(4) net incremental depreciation and amortization adjustments associated with the application of purchase accounting recorded in accordance with GAAP.

BLACK KNIGHT, INC.

Reconciliation of GAAP to Non-GAAP Financial Measures

(In millions)

(Unaudited)

Reconciliation of Revenues to Adjusted Revenues and Organic Revenue Growth



Three months ended June 30,

2021 2020 Organic

Pre-acquisitionAdjustedrevenue

As reportedAs reportedrevenues^(1) base growth

Servicing $207.8 $184.3 $ - $184.3 13 %Software

Origination 97.6 60.8 30.6 91.4 7 %Software

Software 305.4 245.1 30.6 275.7 11 %Solutions

Data and 55.9 48.2 0.7 48.9 14 %Analytics

Corporate and - (0.2) Other

Revenues 361.3 293.1

Deferred revenue purchase - 0.2 accounting adjustment

Adjusted $361.3 $293.3 $ 31.3 $324.6 11 %revenues

Includes pre-acquisition revenues of Optimal Blue, DocVerify, eMBS and(1) NexSpring Financial, LLC ("NexSpring") for the three months ended June 30, 2020.



Six months ended June 30,

2021 2020 Organic

Pre-acquisitionAdjustedrevenue

As reportedAs reportedrevenues^(1) base growth

Servicing $410.5 $380.0 $ - $380.0 8 %Software

Origination 190.7 109.8 58.3 168.1 13 %Software

Software 601.2 489.8 58.3 548.1 10 %Solutions

Data and 109.8 94.3 3.0 97.3 13 %Analytics

Corporate and - (0.3) Other

Revenues 711.0 583.8

Deferred revenue purchase - 0.3 accounting adjustment

Adjusted $711.0 $584.1 $ 61.3 $645.4 10 %revenues

Includes pre-acquisition revenues of Optimal Blue, Collateral Analytics,(1) LLC ("Collateral Analytics"), DocVerify, eMBS and NexSpring for the six months ended June 30, 2020.

BLACK KNIGHT, INC.

Reconciliation of GAAP to Non-GAAP Financial Measures (Continued)

(In millions, except per share data)

(Unaudited)

Reconciliation of Net Earnings to Adjusted EBITDA



Three months ended June 30, Six months ended June 30,

2021 2020 2021 2020

Net earnings attributable to $ 39.7 $ 39.1 $93.8 $89.2 Black Knight

Depreciation and 90.4 58.6 178.2 116.3 amortization

Interest expense, 20.9 13.0 41.2 27.7 net

Income tax expense 10.5 17.2 15.7 25.4

Other expense 1.0 (18.8) 4.2 (18.0) (income), net

Equity in losses (earnings) of unconsolidated 5.0 31.0 (1.4) 25.4 affiliates, net of tax

Gain on sale of investment in unconsolidated - (5.0) - (5.0) affiliate, net of tax

Net losses attributable to redeemable (7.5) - (16.1) - noncontrolling interests

EBITDA 160.0 135.1 315.6 261.0

Deferred revenue purchase accounting - 0.2 - 0.3 adjustment

Equity-based 13.2 9.5 23.7 21.2 compensation^(1)

Debt and/or equity - - - 0.2 offering expenses

Acquisition-related 4.0 2.5 11.3 3.9 costs

Expense reduction 0.3 - 0.9 0.8 initiatives

Adjusted EBITDA $ 177.5 $ 147.3 $351.5 $287.4

Net earnings margin 8.9 % 13.3 % 10.9 % 15.3 %

Adjusted EBITDA 49.1 % 50.2 % 49.4 % 49.2 %margin

Includes accelerated recognition of equity-based compensation expense of(1) $2.9 million for the three and six months ended June 30, 2021 and $0.2 million for the six months ended June 30, 2020.

BLACK KNIGHT, INC.

Reconciliation of GAAP to Non-GAAP Financial Measures (Continued)

(In millions, except per share data)

(Unaudited)

Reconciliation of Net Earnings to Adjusted Net Earnings



Three months ended June 30, Six months ended June 30,

2021 2020 2021 2020

Net earnings attributable to $39.7 $39.1 $93.8 $89.2 Black Knight

Equity in losses (earnings) of unconsolidated 5.0 31.0 (1.4) 25.4 affiliates, net of tax

Gain on sale of investment in unconsolidated - (5.0) - (5.0) affiliate, net of tax

Depreciation and amortization 53.7 24.7 106.6 48.3 purchase accounting adjustment ^(1)

Deferred revenue purchase accounting - 0.2 - 0.3 adjustment

Equity-based 13.2 9.5 23.7 21.2 compensation ^(2)

Debt and/or equity 0.1 - 2.3 0.2 offering expenses

Acquisition-related 4.0 2.5 11.3 3.9 costs

Expense reduction 0.3 - 0.9 0.8 initiatives

Legal matters 1.0 (18.7) 1.9 (17.9)

Income tax expense (15.9) (5.0) (38.0) (18.7) adjustment

Redeemable noncontrolling (12.5) - (25.0) - interests adjustment ^(3)

Adjusted net $88.6 $78.3 $176.1 $147.7 earnings



Adjusted EPS $0.57 $0.52 $1.13 $0.99

Weighted average shares outstanding, 155.7 150.0 155.8 149.3 diluted

(1) Components of the depreciation and amortization purchase accounting adjustment are as follows:



Three months ended June 30, Six months ended June 30,

2021 2020 2021 2020

Other intangible $ 39.1 $ 13.4 $ 77.9 $ 26.4 assets

Computer software 14.5 11.3 28.4 22.0

Property and 0.2 0.2 0.4 0.4 equipment

Deferred contract (0.1) (0.2) (0.1) (0.5) costs

Depreciation and amortization $ 53.7 $ 24.7 $ 106.6 $ 48.3 purchase accounting adjustment

Includes accelerated recognition of equity-based compensation expense of(2) $2.9 million for the three and six months ended June 30, 2021 and $0.2 million for the six months ended June 30, 2020.

For the three and six months ended June 30, 2021, the redeemable(3) noncontrolling interests adjustment primarily includes the effect of the net incremental depreciation and amortization adjustments associated with the application of purchase accounting.

BLACK KNIGHT, INC.

Reconciliation of GAAP to Non-GAAP Financial Measures (Continued)

(In millions)

(Unaudited)

Reconciliation of Revenue Growth to Adjusted Revenue Growth and Organic Revenue Growth



Full Year 2021 Guidance Full Year 2020

Pre-acquisitionAdjusted

Low High As reportedrevenues^(1) base

Revenues $ 1,447 $ 1,463 $ 1,239 $ 101 $1,340

Revenue growth 17 % 18 %

Organic revenue 8 % 9 % growth

Includes pre-acquisition revenues of Optimal Blue, Top of Mind, eMBS,(1) DocVerify, Collateral Analytics and NexSpring for the year ended December 31, 2020.

Information for Investors:Information for Media:



Steve Eagerton Michelle Kersch

Black Knight Black Knight

904.854.3683 904.854.5043

steven.eagerton@bkfs.com michelle.kersch@bkfs.com

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SOURCE Black Knight, Inc.