Segment Information

6 Months Ended

Jun. 30, 2023

(12)Segment Information

Accounting Standards Codification (“ASC”) Topic 280, Segment Reporting ("ASC 280") establishes standards for reporting information about segments and requires that a public business enterprise reports financial and descriptive information about its segments. Segments are components of an enterprise for which separate financial information is available and are evaluated regularly by the chief operating decision maker (“CODM”) in deciding how to allocate resources and in assessing performance. Our chief executive officer is identified as the CODM as defined by ASC 280. To align with the internal management of our business operations based on service offerings, our business is organized into two segments. Refer to Note 10 — Revenues for a description of our Software Solutions and Data and Analytics segments.

Separate discrete financial information is available for these two segments, and the operating results of each segment are regularly evaluated by the CODM in order to assess performance and allocate resources. We use EBITDA as the primary profitability measure for making decisions regarding ongoing operations. EBITDA is earnings before Interest expense, net, Other income (expense), net, Income tax expense and Depreciation and amortization. It also excludes Equity in (losses) earnings of unconsolidated affiliates. We do not allocate Interest expense, net, Other income (expense), net, Income tax expense, equity-based compensation and certain other items, such as purchase accounting adjustments and acquisition-related costs to the segments, since these items are not considered in evaluating the segments’ overall operating performance.

Segment asset information is not included below because we do not use it to evaluate performance or allocate resources. Summarized financial information concerning our segments is shown in the tables below (in millions):


	Three months ended June 30, 2023
	Software		Data and		Corporate and
	Solutions		Analytics		Other			Total
Revenues	$	323.6	$	44.6	$	—		$	368.2
Expenses:
Operating expenses		155.5		33.9		25.0	(1)		214.4
Transition and integration costs		—		—		11.0	(2)		11.0
EBITDA		168.1		10.7		(36.0)			142.8
Depreciation and amortization		34.0		3.9		44.2	(3)		82.1
Operating income (loss)		134.1		6.8		(80.2)			60.7
Interest expense, net									(33.5)
Other income, net									50.0
Earnings before income taxes and equity in losses of unconsolidated affiliates									77.2
Income tax expense									21.2
Earnings before equity in losses of unconsolidated affiliates									56.0
Equity in losses of unconsolidated affiliates, net of tax									(0.7)
Net earnings								$	55.3


	Three months ended June 30, 2022
	Software		Data and		Corporate and
	Solutions		Analytics		Other			Total
Revenues	$	339.4	$	55.1	$	—		$	394.5
Expenses:
Operating expenses		148.7		37.4		30.7	(1)		216.8
Transition and integration costs		—		—		8.2	(2)		8.2
EBITDA		190.7		17.7		(38.9)			169.5
Depreciation and amortization		35.9		4.0		52.6	(3)		92.5
Operating income (loss)		154.8		13.7		(91.5)			77.0
Interest expense, net									(22.6)
Other expense, net									(2.4)
Earnings before income taxes and equity in losses of unconsolidated affiliates									52.0
Income tax expense									11.6
Earnings before equity in losses of unconsolidated affiliates									40.4
Equity in losses of unconsolidated affiliates, net of tax									(0.1)
Net earnings								$	40.3


	Six months ended June 30, 2023
	Software		Data and		Corporate and
	Solutions		Analytics		Other			Total
Revenues	$	660.3	$	90.1	$	—		$	750.4
Expenses:
Operating expenses		305.5		67.2		54.8	(1)		427.5
Transition and integration costs		—		—		16.5	(2)		16.5
EBITDA		354.8		22.9		(71.3)			306.4
Depreciation and amortization		68.1		7.9		88.7	(3)		164.7
Operating income (loss)		286.7		15.0		(160.0)			141.7
Interest expense, net									(63.6)
Other income, net									188.0
Earnings before income taxes and equity in losses of unconsolidated affiliates									266.1
Income tax expense									67.1
Earnings before equity in losses of unconsolidated affiliates									199.0
Equity in losses of unconsolidated affiliates, net of tax									(1.9)
Net earnings								$	197.1


	Six months ended June 30, 2022
	Software		Data and		Corporate and
	Solutions		Analytics		Other			Total
Revenues	$	670.1	$	111.6	$	—		$	781.7
Expenses:
Operating expenses		291.2		74.9		58.6	(1)		424.7
Transition and integration costs		—		—		15.8	(2)		15.8
EBITDA		378.9		36.7		(74.4)			341.2
Depreciation and amortization		71.0		7.8		105.2	(3)		184.0
Operating income (loss)		307.9		28.9		(179.6)			157.2
Interest expense, net									(43.7)
Other expense, net									(3.6)
Earnings before income taxes and equity in earnings of unconsolidated affiliates									109.9
Income tax expense									10.5
Earnings before equity in earnings of unconsolidated affiliates									99.4
Equity in earnings of unconsolidated affiliates, net of tax									303.0
Net earnings									402.4
Net losses attributable to redeemable noncontrolling interests									2.5
Net earnings attributable to Black Knight								$	404.9

(1)

Operating expenses for Corporate and Other includes equity-based compensation, including certain related payroll taxes, of $6.7 million and $13.0 million for the three months ended June 30, 2023 and 2022, respectively and $18.3 million and $24.2 million for the six months ended June 30, 2023 and 2022, respectively.

(2)	Transition and integration costs primarily consists of costs related to the ICE Transaction and costs associated with acquisitions.

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

- Definition

The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 22
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482810/280-10-50-22

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
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-Name Accounting Standards Codification
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-Paragraph 15
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482810/280-10-50-15

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
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-Name Accounting Standards Codification
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-URI https://asc.fasb.org//1943274/2147482810/280-10-50-31

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
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Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
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-Name Accounting Standards Codification
-Section 50
-Paragraph 42
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482810/280-10-50-42

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
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-Section 50
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-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482810/280-10-50-32

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 40
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482810/280-10-50-40

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
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Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
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-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482810/280-10-50-26

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
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-Name Accounting Standards Codification
-Section 50
-Paragraph 34
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482810/280-10-50-34

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
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-Name Accounting Standards Codification
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-Paragraph 41
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482810/280-10-50-41

Reference 12: http://www.xbrl.org/2003/role/disclosureRef
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Reference 13: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
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-Paragraph 21
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Reference 14: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 32
-Subparagraph (e)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482810/280-10-50-32

+ Details

Black Knight, Inc. 10-Q