Daniel Kennedy Murphy - Treasurer, Senior VP & Head-Investor Relations William P. Foley, II - Chairman Raymond R. Quirk - Chief Executive Officer Anthony J. Park - Chief Financial Officer Thomas J. Sanzone - CEO-Black Knight Financial Services, Fidelity National Financial, Inc..

Mark C. DeVries - Barclays Capital, Inc. Eric Beardsley - Goldman Sachs & Co. Bose George - Keefe, Bruyette & Woods, Inc. John Campbell - Stephens, Inc. Mark Douglas Hughes - SunTrust Robinson Humphrey Chris Gamaitoni - Autonomous Research US LP Jason S. Deleeuw - Piper Jaffray & Co (Broker) Kevin Kaczmarek - Zelman & Associates.

Ladies and gentlemen, thank you for standing by. Welcome to the FNF 2014 Earnings Call. At this time, all participants are in a listen-only-mode. Later, we will conduct a question-and-answer session and instructions will be given at that time. As a reminder, today's call is being recorded. I would now like to turn the conference over to Dan Murphy.

Please go ahead..

Thank you, good morning, everyone, and thank you very much for joining us for our fourth quarter 2014 earnings conference call. Joining me today are our Chairman, Bill Foley; CEO Randy Quirk; President, Brent Bickett; CFO, Tony Park; and our Black Knight CEO, Tom Sanzone. We'll begin with a brief strategic overview from Bill.

Randy will review the title business and Tony will finish with a review of the financial highlights. We'll then open the call for your questions and finish with some concluding remarks from Bill. Please note that we are only focused on FNF on this call and we will take your questions related to FNF only.

We will have a separate FNFV call at noon Eastern Time today. This conference call may contain forward-looking statements that involve a number of risks and uncertainties, statements that are not historical facts, including statements about our expectations, hopes, intentions or strategies regarding the future are forward-looking statements.

Forward-looking statements are based on management's beliefs as well as assumptions made by and information currently available to management. 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.

We undertake no obligation to update any forward-looking statements whether as a result of new information, future events or otherwise.

The risks and uncertainties which forward-looking statements are subject to include but are not limited to the risks and other factors detailed in our press release dated yesterday, and in the statement regarding forward-looking information, risk factors and other sections of the company's Form 10-K and other filings with the SEC.

This conference call will be available for replay via webcast at our website at fnf.com. It will also be available through phone replay beginning at 1:00 PM Eastern Time today through next Thursday, February 26. The replay number is 800-475-6701 and the access code is 351178. Let me now turn the call over to our Chairman, Bill Foley..

Thanks, Dan. This is a strong finish to a great year for our title insurance business. Despite a continued sluggish real estate market, we achieved a 14.1% pre-tax title margin, for the fourth quarter, a 14.3% pre-tax title margin for the last three quarters of 2014 and a 12.5% pre-tax title margin for the full year of 2014.

Overall, we are proud of the financial results we posted in our title business in 2014 and remain confident in our ability to generate a 15% to 20% pre-tax title margin in an improving real estate market.

Black Knight had an another impressive quarter, generating 12% revenue growth and an adjusted EBITDA margin of 43%, a 70 basis points sequential margin improvement from the third quarter of 2014. Total revenue was $220 million led by servicing technology revenue of approximately $155 million.

We remain excited about the organic revenue growth opportunity of Black Knight, as the sales pipeline is strong across our technology and data and analytics business as we enter 2015.

We also announced the initial filing of a Black Knight IPO registration statement with the SEC in December and are working towards having Black Knight operate as an FNF majority-owned publicly-traded company in 2015. I'll now turn the call over to Randy Quirk, to discuss the title insurance business..

Thank you, Bill. The fourth quarter was a strong finish to a very successful year for our title business. As Bill, mentioned, we generated a 14.1% title margin in the fourth quarter, our third straight quarter with better than 14% pre-tax title margin, despite closed order accounts declining sequentially in the fourth quarter.

We do expect a normally seasonally weaker pre-tax title margin, in the first quarter of 2015. For the fourth quarter, total open orders averaged 7,175 orders per day, with October at 7,650, November at 7,400 and December declining to 6,500. Of the 7,175 total orders per day, approximately 5,600 were at FNT and 1,600 were at ServiceLink.

The mix towards purchase transactions declined sequentially from the third quarter, with 52% of fourth quarter open orders related to purchase transactions. At 60% of FNT open orders were purchase related and 77% of ServiceLink open orders were refinance related.

In January, total open orders per day averaged more than 9,500, as refinancing volumes increased with the decline in mortgage rates. Additionally for the first two weeks of February, total open orders per day averaged more than 10,000.

We had a strong finish to the year in our commercial business, generating $166 million in national commercial revenue, a 14% increase over the fourth quarter of 2013, as the average fee per file of $13,100 grew 15% and closed order volume of $12,700 decreased by 1%. Sequentially, commercial revenue grew by 22% from the third quarter.

Additionally, we have begun to capture the impact of local commercial volume for our direct operations in addition to the national commercial revenue we currently report. For the fourth quarter, total combined direct commercial revenue was approximately $274 million.

The fee per file in the fourth quarter was positively impacted by the continued mix favoring purchase transactions as well as the strong commercial title quarter. The total fee per file of $2,131 increased 2% versus the fourth quarter of 2013.

The FNT fee per file of $2,382 increased by 5% over the fourth quarter of 2013, and ServiceLink's fee per file of $1,027 was a 1% increase over the prior year. Also excluding our national commercial revenue, the total fee per file was $1,699, a 1% increase over the prior year quarter.

As we progressed through the normally seasonal slowdown in the fourth quarter order counts, we reduced head count by approximately 240 positions with approximately 220 of those coming from FNTG and 20 of those in ServiceLink.

Despite the sharp increase in refinance orders in January, we have only added approximately 95 positions with 115 of those coming in FNTG and ServiceLink actually eliminated an additional 20 positions. Let me now turn the call over to Tony Park to review the financial highlights..

Thank you, Randy. We generated $1.7 billion in revenue in the fourth quarter, with title generating approximately $1.5 billion in total revenue, and Black Knight contributing $220 million in total revenue. Adjusted net earnings were $144 million, or $0.50 per diluted share.

The title segment generated nearly $1.5 billion in total revenue for the fourth quarter, a 7% increase over the fourth quarter of 2013. Direct title premiums increased 13%, while agency premiums declined by 14%. Our direct operations received more of the commercial premiums than our agency operations and we had a very strong commercial fourth quarter.

Also the centralized refinance business that came with the LPS acquisition is in direct premiums this year and not in the prior year. ServiceLink produced revenue of $211 million, adjusted EBITDA of $27 million, an adjusted EBITDA margin of 13%, pre-tax earnings of $23 million, and an adjusted pre-tax margin of 11%.

Black Knight generated fourth quarter revenue of $220 million, an adjusted EBITDA of $96 million, an adjusted EBITDA margin of 43%, which is a 70 basis point sequential improvement from the third quarter of 2014. Debt outstanding declined to $2.7 billion, as we repaid the remaining $100 million under our credit facility during the fourth quarter.

This leaves us with the $1.1 billion term loan outstanding from the original total of $1.4 billion borrowed for the LPS acquisition in January 2014. Our debt to total capital ratio on a consolidated basis was 30% at December 31.

Total title claims paid were $78 million during the fourth quarter, a decrease of $22 million or 22% from the fourth quarter of 2013. Full year claims paid were approximately $304 million, a $99 million or 25% decrease from total claims paid in 2013.

We've realized more than $312 million in LPS run rate synergies as of the end of December with $283 million of those being expense synergies. We had more than a $67 million benefit to pre-tax earnings from the cost synergies in the fourth quarter. The synergy bonus program has been discontinued as of December 31, 2014.

Finally, our core FNF investment portfolio totaled nearly $4.3 billion at December 31. From a regulated standpoint, we have $1.8 billion in statutory reserves, $1.5 billion in regulated cash and investments, and approximately $700 million in secured trust deposits, for a total of approximately $4 billion in regulated cash and investments.

From an unregulated perspective, we have approximately $180 million of unregulated cash at core FNF as of December 31. There is also approximately $140 million in consolidated cash and investments at Black Knight and ServiceLink and approximately $50 million in cash at subsidiaries that is restricted by minimum working capital or other requirements.

Let me now turn the call back to our operator to allow for any questions..

One moment please, for our first question. We'll go to the line of Mark DeVries with Barclays. Please go ahead..

Yeah. Thanks.

First, I was just hopping Bill, you could comment on kind of your interest in maintaining the majority ownership in BKFS, both over the intermediate and longer term following the IPO?.

Yeah. Mark, the FNF right now is committed to being a majority-owner into consolidating BKFS, even while it stands as a public company. The technology assets and the interrelationship with ServiceLink, our national business from both a loan origination or a refinance transactional support and also from default side is just too important to us.

And so we've really got to – it's really important for us to maintain that majority ownership. We can't speak for our partner T.H. Lee. At some point, we assume they will begin disposing off their interest and increase the public float somewhat.

We also understand that as part of the IPO process, they will be selling a relatively small amount of their shares into the market. We don't intend to offer any of our shares as part of the IPO process. So, it will be primarily new shares being issued..

Okay, that's helpful. Could you also talk about kind of first IPO thoughts on use of excess capital. I mean I guess after paying the intercompany note, you should still have some availability.

How are you thinking about either buying back stock, increasing the dividend or potentially doing some M&A to supplement your platform?.

So in terms of, on the FNF side, with the IPO proceeds, we intend to repay the intercompany note, which will generate about $690 million of proceeds up to FNF. We also have a plan that we're working on to refi the Mirror Notes, so it becomes a – it will become a Black Knight obligation as opposed to being a Mirror Notes from FNF down to Black Knight.

And both of those – the combination of those two factors will increase Black Knight's – or reduce Black Knight's interest expense by about $60 million. With that $690 million, we will then be in a position to be aggressively looking at stock buybacks.

I mean we feel for a long time with all the shares that we issued in conjunction with the LPS acquisition and just other shares that were issued over the last several years is that, we just have too many shares outstanding.

So you'll be seeing after the – assuming the Black Knight IPO is successful and the repayment of the intercompany note occurs as we believe it will, you'll be seeing a pretty aggressive stock buyback program by FNF..

Great. Thanks.

And just one last one thing, I'm sorry, if I missed this, but could you comment on how the January and February open order trends are?.

Yeah. I can give you that information. This is Randy. We certainly got surprised in January when the refinance orders really took off on us. And so, we went from about 6,000 orders per day at the end of 2014, up to 9,500 orders per day in January.

And now running through the first half pretty much into the third week of February, we're running at 10,000 orders per day, almost entirely driven by the refinance market. On the purchase market, on an order per day basis we are up 9% from the previous January, but if we remove ServiceLink from those numbers, the market is relatively flat..

Okay. Great.

And what's the purchase refi mix in the January, February numbers?.

January, now we are opening 58% refinance and the same in February. In the fourth quarter, we were to the resale side on the mix. So it's 58% refinance. So it's been quite a swing. And we don't expect it to last forever, it should start to settle down, we think, we've seen that in the last week or two. But the mix is to the refinance side currently..

Got it. Thank you..

You do have a question from Eric Beardsley with Goldman Sachs. Please go ahead..

Hi thank you. Just on the ServiceLink purchase default orders.

What's driving the strength there, are you picking up more share of those orders?.

Well we don't know if we're picking up more share, we think that recently the banks have gotten a little bit more active on the default side. So we're seeing with our current markets that we're getting – with our current relationships, we're receiving more volume from them. So in that regard, I suppose it would be more share.

But the banks are getting a little bit more active is what we've seen in the last couple of months..

Okay.

And then on the term note, I guess, what are your plans between now and the Black Knight IPO? Are you looking to pay down any of that prior to receiving proceeds?.

Tony, probably not, are we?.

We have $1.1 billion outstanding on the term-loan. We have repaid the credit facility, so that's fully paid down. I guess to the extent we have excess cash generated. Keep in mind, Q1 is typically are always the lightest in terms of cash generation at FNF, because of annual incentives paid in the first quarter.

So there're probably not a lot of repayment to the term loan in the first quarter..

Okay, great. Thank you..

And next we'll go to the line of Mr. George with KBW. Please go ahead..

Hey, guys. First, actually one on the title margin, in terms of, if transaction activity is relatively stable in 2015 versus 2014, what do you guys expect in terms of the title margin? And also in your presentation or in the release you note that 15% to 20% margins are attainable in an improving real estate market.

Just curious if you can quantify what kind of market you would need to get to the high end of that range?.

Well, what we do need is a purchase market in 2015. We're very strong with our multiple brands on the commercial. On the commercial side we expect debt to continue in 2015 into 2016, and potentially beyond. The refinances we've seen fell off in the backend of 2013 through most of 2014.

We've got this bit of a surge, but the real cornerstone of this margin improvement will be an increase in the purchase market. The MBA is projecting – I believe it's a 15% increase in purchase in 2015 over 2014. And we've got the footprint, we're ready to go. We just need a larger market.

MBAs, they were at $1.2 trillion last year, they're looking for $1.1 trillion this year. We can use a little help there in the overall volume. But when the purchase moves and the commercial stays where it's at, we can get into that 15% to 20% range..

Okay. Great. And then actually just switching to Black Knight. Actually during your Investor Day you guys had shown kind of the addressable market and Black Knight's share of that.

In terms of the market as a whole, can you discuss how fast that could grow? And then I think you had Black Knight at kind of 27% of that addressable market and how big Black Knight could get over the next few years?.

The particular growth areas for Black Knight are going to be data and analytics, which is showing strong growth right now, our RealEC platform, our Empower loan origination platform. We really are – we have great software and technology.

And while we had a very good organic growth quarter in the fourth quarter of 12%, we don't expect that same 12% to occur in the first half of this year. We really believe we're going to be mid to high single-digits.

Then as we start following through on a number of implementations that will be finalized in August, we should start seeing some significant growth again organically. So, specific numbers, I can't give them to you. We're taking share, we're taking business every day from our competitors. We have an excellent management group in place.

So that's kind of the way I'd have to answer the question..

And actually in terms of the changes that are happening in August, I guess that's the new disclosures.

Can you just – is there any impact on the title side? Are they compliance-related costs that we have to think about there as well?.

Not really.

Are there Randy?.

No, I don't see, so nothing – not to any measure..

Okay.

And then the benefit from that piece of it, is that really going to be coming in through closing Insight?.

I don't know. Tom, you're on the phone.

Do you want to address that?.

Yeah. I mean basically we have our heads down on major deliveries for closing Insight for August, that's going to automate the process. We're working with most, many of the significant players in the industry to kind of standardize on the platform as much as we can.

And hopefully a combination of working with the top lenders and all the agents we'll be able to automate as much of the process as we can to help make it more efficient, if you didn't have the automation it would be significantly higher cost to do it manually..

Okay. Actually just one follow-up on that.

And in terms of revenues for closing Insight, do a lot of that come in after the August 1 deadline or is it sort of already coming in?.

There is some coming in for some of that actually earlier deals, but most of it hits in August..

We will go to the line of John Campbell with Stephens, Inc. Please go ahead..

Thanks guys. Congrats on a good quarter..

Thanks..

Just back to the question just relating to the RESPA-TILA deadline in August and as we think about Black Knight in the pipeline.

Are some of the mega lenders, the Bank of Americas and the Citis of the world, are they just laser focused on the pending (23:05) and that might be extending the Black Knight sales cycle?.

Tom, I don't really feel there that's happening. I mean we've got our sales in place.

We really are implementing as opposed to selling right now through August, then we will start the sales cycle aggressively again, but our plate is pretty full right now, that's why we're really thinking that we're going to be in that mid-to-high single digits in terms of organic growth through the first six months or nine months of this year.

And then we'll be able to start cranking it up..

Yeah. I think....

Do you have something to add Tom to that?.

Yeah. I think, Bill that's right. And the way it kind of lays out right now is, the large players really have two areas of focus right now. The consent order being number one and getting out of the consent order.

And then, two, they are focused on the RESPA-TILA changes that are coming in August, which predominantly affects their origination business and so that's their priority. We are obviously right in the middle of it with closing Insight on the RESPA-TILA.

But I do think that as they come out of the consent order, then it opens up opportunities for us in other areas of the business like servicing and other areas like that..

Okay. That's helpful. And then just curious about your thoughts around just the agency strategy in 2015 and 2016. And don't get me wrong, the direct rev growth outpacing agency, I mean that's great for margins, so we are happy to see that. But direct outpacing agency throughout 2014 was a little surprising just given the decline in refi.

Is that more a product of direct just outperforming, are you guys shutting agents? And then just related to that, you guys talked at Investor Day about growing that agency market share by about – I think you said 3% or so.

Is that still the case, and how quickly would you guys like to see that done?.

Well, yes, that is the case. We are growing our agency footprint. In 2014, we signed over 300 new agents and of course it takes a while for that revenue to hit the pipeline and come into play. So that's part of the commitment that we made in terms of agency growth.

And you're also correct in that particularly the impact of the commercial revenue at the back end of 2014, most of that falls into our direct operations. So you'll see all the spike in revenue there, but you don't necessarily get the same percentage over on the agency side.

And then we have very significant centralized refinance play in our National Agency Solutions that services national agents. And when the refi's fell off in 2000 – through 2014, that revenue dropped also, it's a very significant part of our agency play. But we're very committed to growing our agents. We're aggressive in that regard.

As I said, we're continuing to sign agents. Our cancelation program, we've kind of left that behind over the last year or two. We look at our agents not just based on some metrics relative to claims potentials. And so, we're continuing to build that footprint and we're very committed to continuing to grow it..

Great, thanks for taking our questions, guys..

You do have a question from the line of Mark Hughes with SunTrust. Please go ahead..

Yeah, thank you.

The EBITDA profitability within the Black Knight business, how should we think about that in the first half? If organic is slowing a little bit, as you ramp up some of these new initiatives, will that have an impact on profitability and is there any meaningful seasonality to that in the first quarter?.

There's is not really seasonality. We'll continue to grow our EBITDA even through these first six months or nine months while we're doing these implementations. We have a lot of deferred revenue, and now some of that deferred revenue rolls into recognizable revenue and also EBITDA.

So, we have an aggressive budget for next year, and it's going to end up with a pretty significant EBITDA expansion. The other thing that happened last year was, we had our synergy bonus plan, which was expensive, but we did get a lot of cost out of Black Knight and that synergy bonus plan has now been terminated or is at an end.

So that stops, so that's actually an advantage to us and the increase in EBITDA. So we're looking for EBITDA growth every quarter. And we don't, we really aren't seasonal, we're kind of recurring revenue model..

Okay. And then, one final one though. Corporate and other category, the personnel other operating expenses. Any notable trend that we should look for, looked like those were down in Q4.

How should we think about that for 2015?.

Yeah. I think 2015, you can expect it to look a lot like what you see in the fourth quarter, there's really as you can see, as we carve out non-GAAPs, there's very little noise in the corporate and other. And so we're running at about $30 million loss on a quarterly basis, pre-tax loss, which is – $21 million of which is interest expense.

So you can expect that to be a pretty good run rate for 2015..

Thank you..

We'll go to the line of Chris with Autonomous Research. Please go ahead..

Thanks for taking my call. On Black Knight, the service business, you mentioned revenue was $130 million or is it $120 million last quarter.

Did you win a big contract or was there a change in the definition?.

No, we added. Tom, we added..

We did add some deals quarter-to-quarter, but the significant ones we announced..

Yeah..

Chris, this is Dan. What we did, Black Knight reports that servicing revenue internally. And so, I wanted to be consistent with that. Last quarter, it was only MSP. So a comparable number last quarter was a couple million dollars less than that. In the future, we're going to continue to stick to that internal definition, so it'll be a better comparison.

But in the third quarter sequentially, I think it was about $152 million or $153 million versus that $155 million, and you'll see us reporting it that way in the future..

Okay. So, you probably consolidated a lot of the default-related service technologies..

Exactly..

Perfect. That's what I thought I just want to make sure.

Is there any update on when we might get additional clarity on the other revenue line items, besides servicing for Black Knight?.

I mean, we really never – we've really got data and analytics and we've got servicing and you've got – we're not breaking on in power and....

No, we don't at this point. We can look at that in the future, maybe post IPO..

Okay. Perfect. And then just some clarity on the Black Night IPO. It was mentioned that proceeds, $600 million and some. So (30:50) share, I'm a little confused.

I thought the offering amount was going to be about $100 million in new issue?.

No, it's going to be larger than that..

Okay..

Probably about 15% of the dilution or about 15% to our interest and THL will sell a very small portion of their ownership interest, 2% or 3%..

Okay..

That proceeds then will go to pay debt – repay the intercompany note and allow us to refinance the mirror note down at Black Knight. So that Black Knight's interest expense is going to really drop significantly..

That makes a lot more sense to me now. And then finally, I just missed this, how much of the synergies were in the quarterly run rate. I know you said it, I just missed it..

Yeah, it was $67 million in pre-tax synergies..

Okay.

And how much of that was cost-related?.

Okay. That's all either personnel or....

Right. All of it....

All of it is cost related..

Perfect. Thank you so much..

Jason Deleeuw with Piper Jaffray. Please go ahead..

Hey, thanks. Congrats on a good quarter. First on Black Knight, could you give us a little bit more color on the pipeline is, pipeline is mostly cross-selling opportunities, any color on new clients in that pipeline.

And also, are you getting more midsized clients there? And then also, can you give us an update on the timing of when Walter is going to board onto MSP?.

Well. Tom, we've had a number of large contracts that we've executed and are continuing to execute, particularly in the data and analytics area. But we aren't at liberty to disclose the names, they're significant names in the industry. And we're taking this business from our competitors.

But we're trying to be a little careful about disclosing who those names are. But one particular contract that was executed in the fourth quarter was $7 million, and it's going to be a terrific run rate contract going forward. Tom, I don't know if you want to talk about the pipeline because we have a strong pipeline....

Yeah..

...in every category that we're – in every one of our technology categories..

We're actually, that's right Bill, it's pretty much strong across the board. If you take our servicing business, obviously we picked up some big clients, we're still going after some big clients in the servicing space. We see a great opportunity in servicing, in the consumer loan space, and we're making a lot of progress there.

So we have a strong pipeline there. We have a strong pipeline in origination technology. The way I think about that, that's non-origination platforms and I really see business, really see is, got the closing Insight platform. The way that's shaping up is we have a lot to deliver for August.

But I actually think that as I see the market evolving, a lot of the players who got on top of the changes quickly are going to convert in August. But I do see a lot of demand for those products post August as well. And our data and analytics business is growing at double-digit rates. We expect that to continue.

As Bill mentioned, we had a very significant deal in the fourth quarter and we expect that there will be others as well. So I'd say pipeline across the board is strong as far as Walter which is Green Tree, either Q4 of this year or Q1 of next year..

Okay. And then on the incremental margins and just the margin profile for Black Knight. It sounds like you guys are still targeting the mid-40%s.

Why can't it be higher going forward? I mean, do we stop at mid-40%s or do we – can we keep going higher from there, any thoughts on that front?.

We're never going to stop. Our first goal is to get to those mid-40%s, to get to 45% or so. But you'll see continued margin expansion and continued revenue growth as we move through 2015. We have a lot of exciting things going on at Black Knight..

Okay. And then on the title side, with commercial, the – can you speak about the mix of higher price properties versus lower price because the refi fee per file or the fee per file in commercial was up meaningfully. But the orders are kind of flattish year-over-year.

So if we get something kind of unique this fourth quarter, why the fee was so much higher? And can you talk about how you see things progressing going forward?.

Well, typically at the end of the year, a lot of the large, large transactions close. And I think that's what we see in every fourth quarter. And then you pay a little bit of a price for it in the first quarter of the following year.

But we just see a lot of large transactions and then the small and medium commercial market is very vibrant also, a lot of activity in the multi-family and the office segments and refinances now are beginning to play a larger role on the commercial side.

But really as the trend goes, when you get towards the back end of the year, you'll just close some real, real large transactions..

Okay. And then on the free cash flow, it looks like it's running roughly in line with adjusted net income now and about 50% of EBITDA.

Are those the correct metrics or ways to think about FNF, free cash flow generation going forward?.

I think generally speaking, that's pretty close. It's going to move around from quarter-to-quarter, but probably in that range. If you look at adjusted cash flows from operations, we generated $177 million in the quarter, less $38 million in CapEx gets you to free cash flow of $139 million.

The $177 million adjusted cash flow is consistent with our pre-tax earnings..

Great. And the last thing on the refi activity, you're seeing to start the year.

Is that mostly on the FHA side with the premium reduction, can you guys tell? And what's your – are you seeing or are you hearing from any of your customers any potential benefit on the purchase side with the FHA premium reduction?.

Well, we don't really have that information. We did see in a couple of weeks in the beginning of the year here that as the refinances came up quickly, it did bring along the resale market coming back quickly.

So even though we're not far ahead from where we were last January in terms of the open orders, the orders came back more quickly here in January into February. So, maybe that has that effect that you're asking about..

Great. Thanks a lot guys..

We do have a question from the line of Kevin with Zalman & Associates. Please go ahead..

Hey, good morning guys. Just had a quick question on the title refinance orders. The FNT orders seem to be gaining some share relative to some other companies that have reported.

And I was wondering if there are any special items that drove that and should we be expecting that going forward?.

You're talking about the overall refinance orders in the – in order account?.

Yeah, within Fidelity National Title, the FNT, so excluding ServiceLink, the refi's were up significantly..

Well, we have a real large network, we have multiple brands, we've got a very aggressive sales team and we have great relationships with these natural lenders as well as the – as long as the regional banks.

So we like what we see and they've come back pretty quickly, and the interest rates, and particularly in these markets where we have our multiple brands, we're able to take advantage of these large markets that have come back maybe more aggressively than some of the smaller markets.

So that might be the answer, I hope I was able to answer that for you..

Okay. Yeah. That's great. Thanks a lot..

You do have a follow-up with Chris. Please go ahead..

Thanks for the follow-up, (39:44) this question.

Can you give us some clarity on the progress of selling Empower and really see down to the mid-market? I know you always were at much strength at (39:55) the enterprise level, but I think that was a goal laid out in your Investor Day?.

We continued to make progress in that area, although right now, we're kind of focused on getting everything done for August. I would see us making more sales and deliveries in that space post August of this year. But, there is definitely interest in that market.

We are in dialog with a number of firms in that segment and I do expect that we will do deals with them, but post August..

And those types of clients, do you see them switching from more installed software platforms or kind of how do you – are they going from in-house to out-of-house or are they switching providers generally?.

Really, I mean, it's a mixed bag, right. I mean some of that is in-house developed software, period, others are vendor products that they actually customize on their own. So in essence they made it a customized platform. It's really not – even though it started as a vendor product, it's really customized.

I'd say those are the two most common scenarios, sometimes it's a one-for-one takeout with another vendor, but most of it is unique customized platforms within the business..

Thank you..

There are no additional questions at this time. Please continue..

The last three quarters of 2014 highlighted our ability to generate strong margins in the Title business in a somewhat sluggish real estate environment. We continue to believe that we can generate even higher margins as mortgage credit becomes more readily available and the residential real estate market continues to improve.

We also expect strong financial performance from Black Knight as we enter 2015. Thanks for being with us this morning..

Ladies and gentlemen, that does conclude our conference for today. Thank you for your participation and for using AT&T Executive TeleConference service. You may now disconnect. Speakers, please hold..