Verisk Analytics (VRSK) 21 Feb 242023 Q4 Earnings call transcript

Good day, everyone, and welcome to the Verisk Fourth Quarter and Full Year 2023 Earnings Results Conference Call. This call is being recorded. [Operator Instructions] For opening remarks and introductions, I would now like to turn the call over to Verisk's Head of Investor Relations, Ms. Stacey Brodbar. Ms. ahead. go please Brodbar,

and for everyone. fourth a XXXX full operator, joining quarter appreciate us year results. today discussion financial good you, We day, you and Thank of our

Verisk's the President Elizabeth On Chief Officer. Financial are today Lee Mann, and Executive Officer; call Chief and Shavel,

quarterly be website, release this found Investors we of our days traditional in have The been earnings replay dial-in. attached and to website earnings the well that as call SEC. the The presentation will as associated an verisk.com. release and to referenced our has A furnished on X-K earnings of be also XX-K can the available on by call this for XX section our

remind future by call in about today. could everyone forward-looking SEC the statements forth Actual including financial what performance, contained include is today's suggested recent our future performance today's set As more will detail may Verisk's in related materially filings. is from our performance in factors guidance. affect comments to those differ that our could about I earnings Information release,

Investors to currency everyone reconciliation reported Finally, but and like on discussed and provided and verisk.com. our excluded earnings non-GAAP is results in for organic in our remind are X-K A website, of today's also that consolidated GAAP results the posted are all financial measures from recent growth section I'd the figures. dispositions constant financial included historic on of this call our presentation

of effort because consequences, adjusted to most from unreasonable may and EBITDA be comparable and EBITDA effect non-GAAP projected the adjusted expenses, we example, including, from other significant. the provide and losses dispositions excluded are directly gains estimating unpredictability reconciliation costs, of for adjusted EBITDA the adjusted results GAAP margin are a EBITDA nonrecurring and certain which acquisition-related margin, high and However, that items not tax of able projected expected to of

Shavel. call to And over turn like to the now Lee I'd

everyone, recap and morning, this am by Good performance clients with participating creation alike. to Thank and year I you, thank was cultural organizational strategic, to for matched marked morning's change what exceptional in Stacey. for value call. and today for shareholders outstanding financial pleased an here and you be Verisk,

Elizabeth financial delivered we March. XXXX. exceeded in in revenue X.X% in the will constant back we on our set detail, Day offering but strongest provide in expectations the summary, initial the at Investor growth organic performance we record since XXXX, public And currency

low adjusted and of basis, We and target basis combine Insurance-only this currency XXX with the than in earlier on initial to basis margin goal points on improvement an build constant beyond. achieving place organic end the XXX EBITDA have we original growth plans that X in margin our of expansion XXXX double-digit of And year points XXXX. of

X% non-Insurance business, on of flow level cash separation basis. Despite still our over the grew unadjusted an $XXX above we to million and free XXXX our

improve our Over base recent the reducing and returning served XX%. on invested to discipline past returns capital. capital by X to from our repurchases, efficiency in about This dispositions substantially billion years, shareholders our share capital we over by through share proceeds also $X boost demonstrated

cyclical to profit-challenged in insurance consistent of And growth our Insurance new inflation while markets. addressing of growth profitability XXXX. lagging and gives deal needs backdrop The me continue long-term strategy on revenue our and clients' most XXXX the industry our confidence strong was in operating exceptional, to resulting in from XXXX the we beyond. are and comparable pressing by challenges business opportunity in drive higher with carriers which to effects restricting losses is relatively predictable

XXXX. X were first billion X the losses $XX.X losses first in in through data maintaining of further months shows of losses personal Best a $XX.X recorded of their pace The the negative to the net deterioration their of the most while for AM auto. recent stable homeowners billion, outlook the This ahead Best from negative, to outlook also line year XXXX downgrade caused way on AM the tracking for from months and

profitability some the result extent, were catastrophe-related challenges the higher in of losses. industry To

PCS points out XXXX data year record events. highest XX activity of the on catastrophe frequency own Our that was with for

period events. major X a While quarter the the fourth and and convective events hurricane quarter XXXX the was events fourth were That XX relatively lower experienced major wind XXXX, did storms not in of make was have U.S. a dominant year. landfall, tropical and said, severe with of quiet only than of which the XXXX source

and raising achieve having rate rates more success growth positive the unwind business to adequacy. carriers restrictions the on very in certain new they premium and taking lines driving end, are as On are writing steps early

XX.X% In X the fact, XXXX. written first growth premium months increased net for of

technological systems. the legacy This change, by industry insurance being structurally, industry to be digitalization technological cloud rapid migration. is More the [ and by ] of debt faces and continues challenged including aging the fact the pace also that compounded

industry focus climate In experience growing on and data fairness of addition, privacy the issues regulatory continues to risk.

our business both pressing structural and Our strategy cyclical to from most designed a are and customers' model address needs, perspective.

and of We participant individually. expertise achieve industry, and than applying invest industry our at knowledge scale clients any to a to one cost of value technical lower on the at ownership our can investment deliver behalf

a solutions more work opportunities develop to integrated expands. basis, new with our on we As clients the

operating articulated focused consistent on profitability and capital are at we disciplined top allocation. driving X growth, namely ensuring predictable key and the priorities Day, efficiency back Investor and line delivering We

minutes a after plan me on each go Let how in to beyond. few XXXX and we spend

Throughout analytic clients initiative through strategic dialogue progress elevate on the Our and become their strategic our strategic priority with in and and with substantial to our clients predictable first data to partner. is delivering made growth innovation. XXXX, we technology consistent dialogue

augment came accelerate over can CEOs up themes half Verisk operate primary of our Verisk our premium, help During to to can can receive? the discuss data our better the and X their of to colleagues their improve could objectives. how better How how industry insurance with the delivery repeatedly. senior finally, connect you amount direct casualty they and the I year, to met information the ecosystems representing expand leaders, in efficiency. the over we U.S. and client improve of And ability support capabilities we Three property manage dozen of written organization? to How analytics and

and the the project point, sets demands our Prospectively, we to have this data On clients been in we our in of businesses, deliver but acceleration industry the insurance on are applications. the reengineer the our intensively segment Core evolving working no-code significantly successfully and addressing see deployed we of having Reimagine most how casualty analytics low, testing ingestion core have and clients. opportunity and with meet services rapidly perhaps Lines life significance to we property that application technology across micro our to material

On applying AI and in complex through Prospectively, medical business. augmentation, applications. we casualty augmented large with generative files Navigator been already we Discovery to solution been technology of several working summarization underwriting developing refine our our dramatically to and have the have accelerate clients

for contractor, City, we partners. in of the our our Lake Both the of record adjuster our attendance Last connectivity, been ecosystem Salt this more attended Conference clients support to ecosystem Xactware investing integration enthusiasm platform and Elevate On had in XX over expressed network demonstrating partners clients have from efficiency, connectivity partners. week, and which business. and I potential and delivery our of improved insurance,

insurance will thrilled of Marsh's gratifying that digital platform. successful were builds should last Finally, broker on the initiative and Verisk of trading XXXX, world-leading its for the on pilot a at This drive [indiscernible] by in on a that we onto week's a endorsement a premium platform market. in efficiency more expansion participation connectivity, Whitespace draw data-first announcement greater which is

expansion will all flow the premium business, anticipates that end through across that XXXX. segment specialty international and With Marsh the U.K. platform its XX% in of over of client placement by

about with Our strategic innovation. unfair repeatedly also requirements are focus the In we reporting and conversations and our more on drive increasing fairness helping regulatory informed discrimination. clients, conversations hear to

internally need, to personal address a respond FairCheck change of to solution the and issues the discrimination their we and in insurers to is potential auto we regulatory outcomes personal first an pricing were To signed for race. FairCheck, customer. address fourth evaluate test determine underwriting and lines' national property our this there designed whether outcomes. recently models extension to did unfair own regarding Verisk's of the to to We helps fairness assess mitigate This unfairly process. model a solution and be variables and during to carrier discriminatory rating quarter, the launched work casualty

are Internally, more an behind industry we XXXX, implementing the sharpen go-to-market consultant practices. with This in incorporating in changed of the an to best investment composition with and XXXX. of strategy steps approach to first change incentives a sales this to during effectiveness, includes our be line outside worked

estimating solutions property packaging In this to will And year. have identified and extreme addition, throughout pricing bringing opportunities be solutions. within them we event market and we

to Our and second Day committed operating is driving over priority driving remain Investor from operating We and efficiency margin time. efficiency expansion profitability.

We our like the talent are low-cost Hyderabad, into Poland tapping leaning markets optimization talent-rich Krakow, into and initiative, India. global and

markets expanded our growth. both We have in real to estate support footprint recently our

underway we with and ERP X optimize which our be Additionally, achieved we human years. our X efficiency and benefits to should modernize our full infrastructure delivering all in across capital achieve and is in to early XXXX including should legacy continue savings upgrade, financial as internal impact technology the which start systems, to

processes. efficiency by improving careful out, look in we and reviews of As we see workflow operational our opportunity our

to our Six Lean savings drive efficiency. and focus structure program continue deploy additional and on Sigma will continue organizational our We to to

our finally, opportunities capital returns. our through value-creating share decision-making invest is We returned shareholders and capital disciplined to flow capital third dividends strong priority support at growth all underscores is repurchases. Verisk. cash with free And attractive allocation into our Excess that Disciplined allocation.

at of incremental our In our internal continue capital XX% approximately invested on as return. approximately capital on at XXXX, XX% high rates returns was capital invest to with return

expansion. business excited many applications to no-code AI, including about technologies, in are low, have we across and emerging [indiscernible] our We the invest generative opportunities

of We example most project. our behind replatforming of Reimagine some need upgrades also our The investing and innovation. future core which Core modernization solutions, been have underinvested support Lines notable and is to are

the As launching customer-facing are this about our engaging and clients project we perspective, we an X/X highlighted plan from are modules before, XXXX. for of as through we investment we way in

is driving contract with they our wins done, strong we already program. returns to there the of customers are largest much recognize value the through While still work as be

estimating stakeholders. to of goal solutions our investing in a is that platform also available property for advance are ecosystem redundant creating and strategic our [indiscernible] resilient, modernizing open We all

richer simplifying a to integration, enable services. both integration new increase should and create our and clients client teams. services deeper partner dynamic for and more are We work environment workflow development solutions and our agility better our developing initiative This

incremental the acquisitions. Insurance-related to excited our in about We are also opportunities value to continue create

market leading position claims, acquisitions in and and in the the services space, in through and example, adding value are where growth add offerings entire and us bodily have life we injury For in spaces to [indiscernible] customers recent auto are enable technology claims driving X and the our Germany, German Rocket, a property respectively. solutions and to cycle. acquisitions across in our acquisitions ACTINEO, we of the deliver These synergies

planning want we leadership Saurabh over Neil to the strategic business Churney, who recent to of leaders from development reins has talented leadership X Spector, was Bill our Before retired year. And into Co-Presidents Rob deeply naming Committee. succession Verisk Extreme replacing Operating Newbold close, I management named address All the Khemka, the new and focused the evidence Underwriting who taking are announcements named a role. end moved and Doug leaders of President, Caccese Senior recently at Solutions, are bench X the of advisory process. and Events, who

leaders. into and CEO. And role I while me Verisk to many them, want the Neil Bill as they their to and left the capable stepped to I their and hands talented, personally energized experienced we in business of very miss will thank of for contributions both have

We XXXX as organizational culture. XXXX. delivered these financial change. we And absorbing while having leadership perspective into X and the was fresh a demonstration success of strong move leaders Verisk's excited and about I am evolving of energy

hand Elizabeth to to it I'll our that, results. With review over financial

in that X.X% capping more I outstanding call. up am quarter, prior basis, off good fourth Verisk Lee, to reflecting fourth growth revenue everyone quarter consolidated and solid GAAP solid an share million, in On day modest and year, and underwriting pleased a to the delivered the versus Thanks, XXXX. growth claims. was a on $XXX

X.X% continuing year, in GAAP operations year. $X.XX onetime due per decline versus continuing tax $XXX XXXX. previously prior expense fourth per to earnings measures million a million share share former down a prior quarter the reserve related segment were versus our benefit $XX Financial $XX litigation million, The in XX.X% operations to from or down Income of while $X.XX, from alongside of that sold primarily Services both was the diluted was were year-over-year the

large in the software net the program. and elevated offset developed completion depreciation These the implementation quarter growth, the partially projects share and our the from benefit amortization of lower contributed XXXX, Additionally, to year, expenses factors fourth interest were certain also internally revenue and by accelerated expense decrease. from of repurchase resulting strong during

results. Moving our of measures the operating businesses. section items [indiscernible] solid Adjusted to press constant non-GAAP for our defined financial release, organic currency of results growth for most our in our demonstrated as

]. revenue growth fourth the In have in in grew would underwriting $X.X OCC in X% X.X%, growth been Normalizing X.X% been [ OCC have fourth claims X.X% revenue the million revenues X.X% of storm-related revenue claims. the and OCC would with of quarter, and in total for growth XXXX, quarter

the highlighted the to earlier fourth quarter. trends began normalize the expected, and we in as some prior elevated recorded quarters, year growth As of environmental in in

tougher Additionally, begin we our to many comparisons overlap did businesses. of in

a full broad-based said, year in total was better-than-expected with for X.X% claims. all underwriting almost year That for and with XXXX the of Growth in revenue results. growth X.X% was delivering by businesses growth OCC X.X% strong record driven Verisk of

the our on pricing growth. highlighted. our trends resulting increased that the patterns high environmental on focus amplify trends the Insurance environment and key elevated activity the transaction the insurance Lee included and shopping capitalized our industry organization weather by business driven U.S. auto XXXX, hard Throughout for energized from market, activity insurance to These active and X

basis in XXXX. revenues, XX% comprise Our growth grew consistent total in throughout the of the an our quarter the experienced with of revenue we quarter The solutions. our trends OCC quarter, growth X.X% in we on all were during which fourth subscription almost saw with subscription-based drivers

XXXX, the In anti-fraud, net our is to [indiscernible] conversion on in during stronger we currently certain premium our saw which customers from strength pricing. underlying the our the through More quarter, augmented from the of in benefit we continued specifically, the continued experienced subscription transactional some benefit bundle. business growth with of [indiscernible] in revenues growth contract by from claim previously

of the continue our That started the part business, expecting we in conversions and to from more some Insurtech are said, anniversary the the weakness benefit benefit these strengths to offset this moderate in by experienced have XXXX. we to from were the These normalized level some attrition of within transition Solutions contractor to within and reduction Marketing a customer Verisk in and weather including across segment. level activity due pressure continued

quarter, representing revenue for Our fourth on transactional XX% growth X.X% increased comparison modest been an which associated revenues, reflecting in impact, of have with year, basis, transactional Ian. the the revenues prior a included revenue OCC Hurricane Adjusting versus tough X.X%. total the would a storm

the and XXXX. our continued we healthy to strong benefit auto of During action results the quarter by solutions from signed from shopping quarter, consumer activity see driven for we large final the deal nonrate

are shopping behavior inflection the positive We in moderate from have expecting in XXXX. last to to overlap growth begun year and

are saw growth double-digit And benefited extreme solutions strong within insurance Our growth as life driven our incremental transactional growth we for within better-than-expected demand customer services. seeing transactional also by business, events revenue we securitizations. from

results now EBITDA basis growth the reported includes OCC was in and in our XX the year. Moving points which EBITDA XX.X%, fourth adjusted prior was results. results, margin, adjusted EBITDA to up inorganic quarter. from both X.X% Total organic adjusted the

investments impact and and The foreign changes. fourth of by acquisitions from quarter was the offset in incentive discipline compensation, growth. sales rate This currency higher pressure reflects margin positive for margin leverage, future part organic cost

OCC was by up revenue total XX.X%, of adjusted reflects efficiency rate cost the across This adjusted was from as points and margin core XXX and leverage year. EBITDA XX.X%, growth the prior strong margin growth of organization. Verisk for year a EBITDA from XXXX basis total operating while tremendous evidenced growth discipline the

earlier, As beyond. operational as profitability move priority Lee and for delivering efficiency a key discussed forward XXXX remains us into we and

further can progress we future confidence to also to investments make balancing growth. continue have We support while

the interest expense lower as net prior of $XX statement, interest The the as fourth the cash net reflects year. was level expense million higher million Continuing income debt quarter on balances interest compared year-over-year $XX in well current balances. down to for

of the increase amortization $XX driven an expense and the of an for the projects fixed certain large service quarter, of by increase and of Depreciation related million timing was XX%. developed completed software $XX primarily additional assets million were The was to placed into year. internally that during

The a of prior XX.X% $XX million the year-over-year to quarter. reserve in tax On compared and taxes, effective in XXXX was benefit tax tax quarter increase litigation the we fourth year the that the reported $XX quarter mentioned in taken XXXX related in rate the our of fourth rate to is onetime million X.X% earlier.

million. These depreciation decreased diluted to prior benefit X.X% net the fourth year adjusted revenue for from negative to expenses, income and solid interest impact amortization share higher net Adjusted quarter. EPS and tax EBITDA X.X% expense lower lower count. the reflect partially the $X.XX the changes by And offset and quarter a growth, $XXX decreased and onetime in average

count share the $X.X that of settlement we of as accelerated $XXX into repurchases share final in share the additional of fourth executed billion March. repurchase well in reflects entered The plan impact as our the the million quarter

cash include that is important perspective, cash basis, the increased activities still net to our divested flow flow business. energy to operating cash reported cash on of previously free flow results from prior year million. $XXX X.X% to a $XXX increased From the million, a XX.X% note while It figures

our potential business. the understate figures full growth these So growth flow Insurance-only cash of

we returned capital and and dividends of billion to XXXX, dividends shareholders repurchases. through during repurchases, $X On

XX% dividend or in $X.XX has share. the increase We cash pleased that $X.XX per quarterly a to are to share Board approved our

to repurchases, On for an [indiscernible], in growth our in our they delivered to pleased performance billion $X addition, and we And deliver $X.X authorization we our XXXX upon build exceptional the with share total with additional billion. authorized our Day are In bringing Investor XXXX. line target. margins has Board also in expectations

More of consolidated billion. revenue billion for specifically, $X.X the range XXXX expect to $X.XX to we in be

to $X.XX to reflects funding We while XX% margin that adjusted the of EBITDA to margin we opportunities also the billion $X.X drive XX% cost expect investment discipline strong This expect to growth. range adjusted be in range. future EBITDA incremental and billion in

our of force and P&L, fixed changes. investing include amortization amortization in capabilities technologies, of $XXX advanced range opportunities to Both Walking and internationally through further subject million new the million. sales items to AI. to effectiveness, our down in of sales the $XXX building with assets of of we expect currency depreciation drive are $XX These expanding million projects [ foreign greater and and including generative approximately ] of the completion timing intangibles acquisitions

We expect range be to all per share. culminates to our adjusted tax This range XX% the the of of to XX%. in earnings $X.XX in rate in $X.XX

to between organically the and which of earnings expenditures be invest list capital million found to our in website, Investors $XXX slide of growth. section million been also guidance to has drive the We all as can measures expect be we deck, posted to future continue complete $XXX A verisk.com.

And comments. now Lee turn over back closing some I will call to the for

about ahead. summary, Thanks, excited the lies Elizabeth. we're In that opportunity

our globally. is our improved partner decision-making business clients through efficiency a formula and for and customer clients value motivating with value for to is focused individuals, through shareholders growth that purpose of in and building operational returns. relationships will and businesses strategy also Our resilience deliver deep to our model, The deliver to combination communities

that, line We [Operator open continue the Instructions] With the the ask to interest and operator questions. to in appreciate for support Verisk. I'll

from line comes Your Alwy the Instructions] from Bank. first Deutsche of [Operator Faiza question

a revenue normalizing. mentioned puts you talking and are onetime last the talk I of So few that noted year to been some wanted and the about all Liz, impacts of takes, you about we've guide.

a So of thinking some give you're growth there and specifically the bit more puts about how takes us transaction perspective, what and are.

full [Audio of think Gap] takes. XXXX. there on were year, in X But the really back strength zooming drivers we

insurance environment the the was pricing first in market. hard The

was space. rebound single though record-breaking a auto as the heard, was year large shopping cat third activity, there was it. XXXX transactional in the hurricane And activity second you weather elevated the a particularly even The for and events the was the driving which,

about into would When making But that we think, does we forecast a for persist think we mother normalize for hard for never we market the future nature. somewhat. can assumptions expect that year, XXXX. transactional insurance activity, first weather, factors And general, -- to the in other for that

a weather assume level of we normalized activity. So more

line next of Your Balsky America. the from question from of Heather comes Bank

It's [indiscernible] for on Heather.

pricing wanted environment a little Just for comment to bit on the XXXX. more

on XXXX? was said elevated. it is that comment you quite You into going Can how

Yes.

So thanks. This Lee. is

we distinguish, able continued strong has in Elizabeth think in first, a progress comments approvals. our have more just pricing So overall growth from first, think there's premium secure me be standpoint, let insurers some been indicated and as described, market as to that as regard. I the rate We to

want differentiate approximately has environment, a is of XX% that X-year premium our growth. from partial that tied And which I to XX% is represents perspective, to constructive. prior benefit. base been pricing to It revenue our

provides some so of And that level support.

deliver value most that anticipated, been than think investment we more are improving I able ability early through is meaningful experience, to what has we good their to realize functionality in creating, which clients as doing, have in how originally their probably Core we Lines value. demonstrated about to we're But are where the we seen our efficiency our platform. had element we We're doing clients. that project, feel what Reimagine deliver from pricing that making of we continue And our momentum renewals we are stronger more significantly have to our pricing that that the

are delivering say clients to that pricing align would structures that that more that done, identifying and for -- I our can further, think we some have identified creating go-to-market we we're to identifying we have clients. we identify value from areas to our capture through how I that the we value And review

Andrew comes JPMorgan. of question the from next from line Your Steinerman

helpful. how nonsubs. is which is mix, My want First, much I auto Slide I revenue all say revenues, Verisk to very I question think just appreciate underwriting the about X,

And ad do that. a what's this in quarter? within please fourth the market guide? assumption for verify the Just did 'XX How

feedback you the the for thanks and Andrew, on slide. We're always listening guys. Thanks, to

largely underwriting XXX%. not revenues revenues, in the is transactional there. some On but subscription auto it There is

the shopping -- was QX, is it to but still activity it And down relative historical from elevated levels. tapered in QX,

J.D. data third-party for think data encapsulates I Power that that.

historic we Even it we're to will assuming are I benefit that for the now over where that But think lapping at tapering is, the levels. more I'll continue on it to strong down turn Doug. environment, more environment. of maybe it

Sure. for question. Thanks, Andrew, Elizabeth, and the thanks,

Just said, I'll Elizabeth. what had echo you

internal and QX month, we at a slight And you see also As slowdown in December. look our data over October, external when a shopping data, slowdown at shopping November, we month the you look activity. it see from from slight

So happen. that slowdown seeing we are

in still actually slowdown We carriers that help expect that's it book to leaking continue. is to way. which in, helps shopping also to in campaigns, elevated nonrate of we earn in allow action activity. on focus so waiting The while and premium for rate bring on our expect out go immediately us this But we'll the they're levels of pivot that that XXXX,

Your comes from Sabadra next of Ashish question RBC. from the line

I to some we and subscription contracted that the as on focus about just of and the insurance I wanted were XXXX. wondering how was headwinds out. we X Marketing growth. activity go Solutions, called through were There the attrition should think deck just

Yes.

spend. carriers out still growth the profitable yet and their side, as we've marketing in year, being achieve trying turned the and to called marketing has on challenged On not

that them and of see to tide are to starting returning some profitability. turn, are We

green on we're yet, in starting that would it but this see you're levels haven't in assuming engines to to of normalized shoots quite that turned environment. to second start say will year. marketing more return been The the I half

the comes Manav Your question Barclays. Patnaik from from of next line

ask Any incremental benefits what's as from of on gen about product pipeline. [indiscernible] this this Brendan also, then talked want for new Manav. And well This [indiscernible] I for kind you with to is that -- some just AI, What's year? the planned year? AI.

to related anything that. So

And going through to Brendan. the repeat you little I'm choppy you, question there. a came because Thank Sure.

about pipeline of do a areas feel I question So product investment. how was we the new think

And lot so are we number a say, working about been particular, been that variety certainly, focus developments the been our really its exploring on. products its we're across has a application generative new I a application. of And would around excited of we In think, the that and -- we've I have businesses. AI and of

I'm second looking what where at to Mourad, been on broadly. applications. claims in to some talk I'm little that AI looking developing going example we're area for a Maroun and going ask deployed our do to as my to generative isolate more other we are have of also bit applications what colleague, have a business doing we about an

the thank and Lee, question. you, you, Thank Manav, for

solutions. our So strong partner-driven just XXXX the building co-creation of of on me to and that ecosystem momentum, client a engagement innovations couple let and highlight our levels productization of led

space in in with domain In the as the medical a space summary we as in in conjunction our customers that injury continue also AI technologies data casualty the deep our to medical staff delivering as extraction space. in and bodily estimation space, deployed have file value legal expertise to traditional well payer methods of property well as order generative the and

order and deployed the well speed as contractors solution adjusters, a methods process. for very is as product in insurers. AI automation in have as XactXpert to talked accuracy, in estimation We've continue the our to other continue the AI We well about connect delivering to also as driving gen customers as important productivity, past which

the we've with a insurance that want add And we've about know, you many thrilled the had to really I'd business. to But success you taste front. of that that, fast doing to give we're of low what technology life businesses Brendan, application on our as been of I no-code and

the to potentially applied have be to on with P&C begun and believe that We engage can clients area. how

opportunity. the business and more business data specialty in together our So as more data to some then data. and underwriting solutions insurance-focused I the been to functions together our some a events tying And sets our integrate our as claims the in market entity extreme specialty of and excess of markets and tying area, as reinsurance well of think that's we try a our have broad able also

we And our particularly those the so migrated integrations ability have as to types are to of cloud, facilitate attractive. now fully

that the So future company. the we support lot that of a have should for stuff underway great growth

comes Meuler from line Baird. Your from question of next the Jeff

a would contribute know to on upsell. I of I'm what guess move any when areas, And pick lot sell-through, call discrete as wondering there perspective. growth, pent-up up see areas profitability And few procyclicality perspective can start as the expect with you especially demand where is may just other to innovation I'd that? premium the the you the -- if you consistent see gets a adequacy, factors a towards environment or the of to it's one, imagine I from would out healthier bookings but but love as I your is bookings maybe be marketing

question, see a procyclicality Jeff. think it. of dimension trying I going isolate the kind on business. I'm Sure, so to on handle to our as the of premium improve It's we we're complex get and and adequacy

I probably think by analysts by should degree start many I of and we economic have saying our as high or a saying of don't investors understand, sensitivity.

tend weather to muted as influenced there market. activities you've or events in so ILS by cyclical effects. is to more be sensitivity We And observed the

it. to And have element a to more so tend those pronounced

is the that encourage as is ability invested there the does we've premium that tailwind renovation is have business to in and And some well growth accelerates think of that seen in a insurance doing the some as investment technologies positive that that we deploy our that scenario. in. -- and do industry that, procyclicality I elements more technology that

separate grows, to that to unconnected is profitability their insurance economic which cyclicality, so as and that to that However, isolate broader be cyclicality, just may muted. relatively and I want

addresses of think, question. I the kind core that, your hopefully So of

the Your Kaplan from Toni next line Stanley. comes Morgan question of from

Why Toni. the Paris XX like the Greg basis on as of about by Or -- higher we those about think skew to investment? XX some Is of through in over from little do ongoing don't those that your How efficiency This you work you that? have. talked you balanced margin X for what you expansion do ongoing talk sounded the about framework points next and X years to is within initiatives initiatives? bit benefit the you a

question. the for Thanks Yes.

Verisk the looking of the efficient We to some investments think at operating business. talking enable our about, next leverage being while and at term in long the in business here core We in levers all do been are us we the continually focused that on we've will that can delivering efficiency pull. fund

out, XXXX have we in back impact to and that's on in order is future and of as still that we'll long a give efficiency years an investments some But expansion. beyond delivering and come way closer. general concept So fund the get

Jeff from question next Silber BMO Markets. the Your of from Capital comes line

XX basis XXXX in XX% And wondering should expect just points another since had guided to then I'm increase margin still if misspeaking you XXXX. last we to I'm XX% in XXXX. expansion XX Day your XX%, last for I EBITDA were excuse where in you continue looking XX% discussion, on But you're what's I'm in want year? and the to adjusted changed sorry margins slide at and XXXX March, Investor XX% to today, here. that I'm the me, about talking -- guiding And to margin then?

the question, you're for right. Thanks Jeff. Yes. Yes,

a guidance time, it at was Investor as which X-point and now Day, is we from a at a a range have that X years tightening X-point what and out said range Our X-year range.

I'll range a XX%. itself XX% that was range, XX% which our XX% had And to margin Day Investor been the tightening target, was a X-year that, you of what of remind to X-point

years the points points been increase margins to by XXXX, in over XXX our X trajectory past has basis basis in XXXX. XXX another So

of basis And would this that. represent then points another of currently, the midpoint XXX top guide on

margin expansion margin trajectory that and in with balancing the growth. of expansion are we So investments

at expansion the of investments and the that midpoint of the in time Day cards I midpoint X Investor The the guide at Those investments that the yet incremental the sales force by investments Day. in the our highlighted encompassed differential were Lee new products. is discussed, not AI to entirely international between that current has our our are place in drive that since then the with Investor Day and Investor M&A generative taken

the are of we're doing ones So since Investor that client-facing particularly new ones margin the being investments, we that of basis XXX delivering those think delivering on still points expansion. our while Day. We're all X --

we that package. so an balance is think attractive And

compound you ahead had March. you on we those what already this in of in top targets of If and come XXXX, delivered that this expansion margin out we

line of Jeffrey comes Andrew from next Your question Securities. from Truist the

question to you side, the most here, And have excited underwriting it different the ability graphic. I'll you you're what that super like you initiatives. a where think or out and my that's about echo on sounds have the perhaps growth, some whether solutions look drive call you faster claims pricing Elizabeth, Andrew's the could on side you helpful. Slide at goes X, maybe when couple the comments to specifically and Lee

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in see to Thank question of opportunity. a you, gives think terms that answer we your you insight value I in way some Yes. I'm going where Andrew. creation

off, value generating industry. our scale to clearly organic I businesses of delivering all different the at think are strong levels. They're first growth,

Saurabh instance, And rules a that's Lines Reimagine and to focused value. our in value creating going can so effort there. scaled I'll a who I'm that It's value broad are area, about for area forms, where where that in capture leads probably incremental reiterate to our talk that loss find opportunity we're And we area where cost ask most Core creating that we business, we bit value. and how our Khemka,

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XXXX announcement specialty variety are with our us of solutions And Core a impact, contribution our a X% in property and the variety that Marsh clients me holds the that where I Saurabh in business about with to to an our that Lines value loss little allows ways expansion. value solutions, with forms, build network bit But costs. of to that of opportunity a talk adding total note let a represents in we also think give revenue areas, network I'll particularly estimating while and And rules Reimagine in connectivity true project.

Sure. Thanks, Lee.

program our from we team our the and Reimagine management to benefits the customers; analytics moves to them naturally analytics, modernization our will of new programs; and client which our into continued make to where the innovation to for program deliverables executive made. will really overall, business, allow we that which new contents of our towards of be access will will industry will has insights the migration benchmark easier customers lines our progress feel about our track forms are systems, and of customers to platform. the internal with as in So like XXXX, provide new it platform, our manage around see core faster finally, value And additional our brought good [indiscernible] analytics insights our to have changes the and

the really are customers [indiscernible]. by encouraged feedback We and around client our these excited innovations, to are see these

thanks opportunity And I'll a And the of more to saying the SaaS as a to more move clients business, is question. opens it segment migration of of there, into growth of well. events for our that in incremental of deliver model, environment. But our by believe, extreme our another traditional products SaaS cap to of off value we ability dimension the to some more type up

from comes Surinder line the Jefferies. question next of Your from Thind

go-to-market In about in equation? this the there terms headcount more of changes should you're are can in part the for? investment color provide a the in terms thing compensation looking strategy, force that of just that we the at point, think or bit How sales structure you of little like

Thank Surinder. Yes. you,

perspectives businesses. structure are we a focus. doing its really could And and number our an looked organization We what of there across So area the all of of for elements, was be have complement I compensation it receptivity better. to outside on to at certainly,

most we there from were market And X they team fairly so as levels we a composition a felt were our where level at -- things. that standpoint One, looked from that create there, for our that retention I believe being treated, both and our customer. aligning they were, sales are though think and opportunities And with the on and a that, the good interest we the that improve value us. focused opportunity generate make will certain

where and though their to at responsive our as how can delivering relative We and of pricing clients in and looking are. also what value more feel value pricing with a that value we aligns way needs clients' spent our we structuring our demonstrable time we're be perception to to

functions. the So I of would just identify those as primary X

we our well effort add as we so would that somewhat sales dialogue is strategic to stronger of we outside into also our driven a support products the opportunities of this, have working not that I communicating tied within may that dialogue, we been be have existing capitalize level certain make value are our the for on at to higher or clients effectively because on a sales of find proposition internally level senior-level of organization. senior aware

expect we do And better so that's well. an we'll where area be to a able that job as

question Blair. comes from William Andrew next line Your Nicholas from the of

ask a about way. different I the businesses wanted to higher-growth

a think you XX% Is XXXX businesses specifically? that XXXX. Day, way in business in in your Investor about trajectory how and I potentially those comment faster-growth the those there talked back representing to on of kind performed of

Elizabeth. at Day trajectory in They achieve results can path kind They've overperformance And businesses. achieved be been the continue strong mix to growth is core largest versus the of change on that. comment to the of Investor Yes, and This in algorithm laid I that 'XX Yes. the goal. on has the our on the in out XXXX.

Your Quelch the from Russell question Atlantic. Redburn comes of next line from

in And Yes. did I the the yield. But flow. at you've It's still flow the free improving free growing Appreciate making of mention think, a her Elizabeth strategy cash I me on on. also peer end at the to you having business. low been and want I the focus appreciate in cash remarks, group. growing look

expect to grow maybe you flow on little cash could beyond. XXXX we free should much So expand this and how and a bit in

We'll at we think has have yield that strength because of flow. Russell. with you free flow very it cash look understate question, business to strong the maybe Again, Insurance for the Thanks the free at Yes. looking revenue stat cash as percent may a of on it.

year still the QX growing. energy demonstration even prior the the which over been it's I numbers mean prior include though number, has grown a the year the growth think we in of business. So

So we about of are flow free generation cash excited the business. the

can conceptually, but the give of think I dividend our line. it, been should roughly on guidance it the that we line in on increase. to give confidence with grow don't demonstration We continue commitment has bottom purest And the

I would you one cash Russell, given accounting add flow, the with start thing And Yes. that even is should out. think free over time I if differences

is commensurate growing it with should growth overall EBITDA that CapEx the that. assuming our so approximate And rate,

see a that I do we're to AI the higher XXXX, the what relates as of business. in CapEx we of number opportunity. think of within because generative growth Part slightly seeing opportunities

we But that have bring periods CapEx should of cash investment flow overall long may And level growth. free growth be down. see the adjusted may term, we over higher overall that EBITDA the -- commensurate of so very with our very

question comes Securities. next Weber from Wells Fargo of from Your line the Seth

a times heard talked opportunities. Lee, couple I've of pricing about you

Or kind XXXX? Do I longer-term extreme think think and to out you couple called a you details some maybe of new way Or is this of here? kind going opportunities, just and estimating. opportunity? pricing any of can finding get more expect just sort we events should you that play that frame of trying this of that. forward? areas more property first And these where will help on I'm you're impact is the that

of renewals kind terms from I've that perspective. certainly occurs improvements that Seth, to referred of our contract revenue would in isolate across Yes. XXXX I an because that to difficult question. thanks our new into It's those say guidance overall are growth for the business. pricing it it factored

as do So a create largely described for us value really than growth see to a particularly that our I we different it model, what we influence operating of which of can and it's source value in that by add general that our believe investing near-term regard, is is And expectations. data and we're existing the that industry our we broader capturing believe that But as is that term. we this for not longer beginning very pricing. some to clients -- in much value-driven that technology

consistent that the basis. target we are longer-term And predictable and X% achieve growth to -- that a so X% supports working to that on

comes Raymond James. question the next from Peters Your from line of Greg

investor This when talk I and curious should just is deck capital repurchases view or forward, acquisitions XX framework And on Greg. moving philosophy. versus investments, of internal management your how wanted et following for we to Slide focus you capital your your Sid cetera? management about in on

Yes. Thanks the for question, Sid.

As we on focuses there, on really philosophy management capital our our returns invested highlight capital.

We will business. look the in invest to

we've given CapEx for the shows year organic business. you the range that the Our investment in

and to above business. On will the continue And we what And the bring and we market. well something those M&A things X And are our that to assess active the continue generating be cost to evaluate strong we opportunities returns of side, Verisk we see businesses additive there in track out for which capital. should it.

opportunities capital extent were as capital continue we return As approximately To we find will past. seen XX%. incremental to shareholders we highlighted you've our in invested in returns the to year on the this don't pretty consistently us the script, do there,

Investor I was to following And want add, in it get investor thank thought X of and first Greg, feedback quarters conducted. Day. that to We that our the after who the I investors thing important one participated survey year-end all and would was

and leverage to our the returns. to kind priority generate that for investors one surveyed Greg, that and high your from comments, specific very Elizabeth's And internal investment, ability of point we recognizing preference clear a was very

us. to our and that, view for that's appreciate And clearly a share will business that so the we input. We very priority be additive

from final Tong Goldman question comes from Your today Sachs. George

bit revenue. What [ ] higher trends transaction that lower storm takes shopping X% and comps, revenue X% in revenue constant growth X% to puts of a year? from an XXXX, into growth this like than considering transaction do are revenue how to you in was dive normalized of Directionally, basis of to Adjusting [ wanted XQ. or trend you organic transaction auto on the some revenue conversion and behavior ] for you're currency deeper seeing. transaction for the growth I revenue rate expect transaction the that strong little trends gets comps, subscription some

for Thanks George. question, the Yes.

double the all, a digit, coming prior off of is transaction very X the growth, I quarters. transactional -- You're revenue for right, year well, full first think, strong it's of

lapping we of So period. sort are that

driver a was was it customers big actually actually we've growth. of of anti-fraud talked biggest the in before element as trends subscription that customers. that auto The by shopping that another activity the about they being headwinds our offset strength, business piece elevated That transactional transactional to some in and weather converted

auto activity. assuming So expect looking we The normalize. shopping to those we're will elevated trends not to trends normalize. begin forward, I Again, think weather

today. participating the We call on thank you for

day. may You Have a now great disconnect.