UNITED STATES SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

☑ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2021

OR

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission File Number 001-37394

Black Knight, Inc.

______________________________________________________________________________________________________________________________________________________

(Exact name of registrant as specified in its charter)

Delaware					81-5265638
(State or other jurisdiction of incorporation or organization)					(I.R.S. Employer Identification Number)
601 Riverside Avenue	,	Jacksonville	,	Florida	32204
(Address of principal executive offices)					(Zip Code)

(904) 854-5100

___________________________________________________________________

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol	Name of each exchange on which registered
Common Stock, $0.0001 par value	BKI	New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☑ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☑  No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer	☑	Accelerated filer	☐	Non-accelerated filer	☐	Smaller reporting company	☐
						Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☑

There were 156,613,822 shares outstanding of the Registrant’s common stock as of May 5, 2021.

FORM 10-Q

QUARTERLY REPORT

Quarter Ended March 31, 2021

TABLE OF CONTENTS

	Page
Part I: FINANCIAL INFORMATION
Item 1. Condensed Consolidated Financial Statements (Unaudited)
A. Condensed Consolidated Balance Sheets (Unaudited) as of March 31, 2021 and December 31, 2020	1
B. Condensed Consolidated Statements of Earnings and Comprehensive Earnings (Unaudited) for the three months ended March 31, 2021 and 2020	2
C. Condensed Consolidated Statements of Equity (Unaudited) for the three months ended March 31, 2021 and 2020	3
D. Condensed Consolidated Statements of Cash Flows (Unaudited) for the three months ended March 31, 2021 and 2020	4
E. Notes to Condensed Consolidated Financial Statements (Unaudited)	5
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	22
Item 3. Quantitative and Qualitative Disclosure About Market Risk	32
Item 4. Controls and Procedures	33
Part II: OTHER INFORMATION	34
Item 1. Legal Proceedings	34
Item 1A. Risk Factors	34
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds	34
Item 3. Defaults Upon Senior Securities	34
Item 4. Mine Safety Disclosures	34
Item 5. Other Information	34
Item 6. Exhibits	34

i

Part I: FINANCIAL INFORMATION

Item 1.Condensed Consolidated Financial Statements (Unaudited)

BLACK KNIGHT, INC.

Condensed Consolidated Balance Sheets

(In millions)

(Unaudited)

	March 31, 2021			December 31, 2020
ASSETS
Current assets:
Cash and cash equivalents	$	44.9	$	34.7
Trade receivables, net		182.5		182.2
Prepaid expenses and other current assets		83.5		70.4
Receivables from related parties		0.1		—
Total current assets		311.0		287.3
Property and equipment, net		161.2		163.1
Computer software, net		507.0		498.3
Other intangible assets, net		654.0		692.3
Goodwill		3,631.5		3,613.4
Investments in unconsolidated affiliates		475.6		470.5
Deferred contract costs, net		175.1		172.3
Other non-current assets		215.5		193.3
Total assets	$	6,130.9	$	6,090.5
LIABILITIES AND EQUITY
Current liabilities:
Trade accounts payable and other accrued liabilities	$	86.9	$	88.1
Accrued compensation and benefits		58.5		79.3
Current portion of debt		17.4		73.0
Deferred revenues		60.2		50.9
Total current liabilities		223.0		291.3
Deferred revenues		89.8		92.7
Deferred income taxes		283.9		284.0
Long-term debt, net of current portion		2,241.5		2,121.9
Other non-current liabilities		100.0		94.9
Total liabilities		2,938.2		2,884.8
Commitments and contingencies (Note 11)
Redeemable noncontrolling interests		578.0		578.0
Equity:
Common stock; $0.0001 par value; 550,000,000 shares authorized; 160,040,598 shares issued and 156,639,060 shares outstanding as of March 31, 2021, and 160,085,413 shares issued and 157,014,712 shares outstanding as of December 31, 2020		—		—
Preferred stock; $0.0001 par value; 25,000,000 shares authorized; issued and outstanding, none as of March 31, 2021 and December 31, 2020		—		—
Additional paid-in capital		2,017.0		2,053.7
Retained earnings		812.0		757.4
Accumulated other comprehensive loss		(37.8)		(38.8)
Treasury stock, at cost, 3,401,538 shares as of March 31, 2021 and 3,070,701 shares as of December 31, 2020		(176.5)		(144.6)
Total shareholders’ equity		2,614.7		2,627.7
Total liabilities, redeemable noncontrolling interests and shareholders’ equity	$	6,130.9	$	6,090.5

See Notes to Condensed Consolidated Financial Statements (Unaudited).

1

BLACK KNIGHT, INC.

Condensed Consolidated Statements of Earnings and Comprehensive Earnings

(In millions, except per share data)

(Unaudited)

	Three months ended March 31,
	2021		2020
Revenues	$	349.7	$	290.7
Expenses:
Operating expenses		186.2		162.4
Depreciation and amortization		87.8		57.7
Transition and integration costs		7.9		2.4
Total expenses		281.9		222.5
Operating income		67.8		68.2
Other income and expense:
Interest expense, net		(20.3)		(14.7)
Other expense, net		(3.2)		(0.8)
Total other expense, net		(23.5)		(15.5)
Earnings before income taxes and equity in earnings of unconsolidated affiliates		44.3		52.7
Income tax expense		5.2		8.2
Earnings before equity in earnings of unconsolidated affiliates		39.1		44.5
Equity in earnings of unconsolidated affiliates, net of tax		6.4		5.6
Net earnings		45.5		50.1
Net losses attributable to redeemable noncontrolling interests		8.6		—
Net earnings attributable to Black Knight	$	54.1	$	50.1
Other comprehensive (loss) earnings:
Unrealized holding gains (losses), net of tax(1)		0.5		(21.6)
Reclassification adjustments for losses included in net earnings, net of tax(2)		3.9		1.2
Total unrealized gains (losses) on interest rate swaps, net of tax		4.4		(20.4)
Foreign currency translation adjustment, net of tax (3)		(0.3)		(0.2)
Unrealized losses on investments in unconsolidated affiliates(4)		(3.1)		(0.2)
Other comprehensive earnings (loss)		1.0		(20.8)
Comprehensive earnings		46.5		29.3
Net losses attributable to redeemable noncontrolling interests		8.6		—
Comprehensive earnings attributable to Black Knight	$	55.1	$	29.3
Net earnings per share attributable to Black Knight common shareholders:
Basic	$	0.35	$	0.34
Diluted	$	0.35	$	0.34
Weighted average shares of common stock outstanding (see Note 5):
Basic		155.6		148.0
Diluted		155.9		148.7

(1) Net of income tax expense of $0.2 million and tax benefit of $7.3 million for the three months ended March 31, 2021 and 2020, respectively.

(2) Amounts reclassified to net earnings relate to losses on interest rate swaps and are included in Interest expense, net above. Amounts are net of income tax benefit of $1.3 million and $0.4 million for the three months ended March 31, 2021 and 2020, respectively.

(3) Net of income tax benefit of less than $0.1 million and $0.1 million for the three months ended March 31, 2021 and 2020, respectively.

(4) Net of income tax benefit of $1.0 million and $0.1 million for the three months ended March 31, 2021 and 2020, respectively.

See Notes to Condensed Consolidated Financial Statements (Unaudited).

2

BLACK KNIGHT, INC.

Condensed Consolidated Statements of Equity

(In millions)

(Unaudited)

	Three months ended March 31, 2021
								Accumulated
				Additional				other					Total		Redeemable
	Common stock			paid-in		Retained		comprehensive		Treasury stock			shareholders’		noncontrolling
	Shares	$		capital		earnings		loss		Shares	$		equity		interests
Balance, December 31, 2020	160.1	$	—	$	2,053.7	$	757.4	$	(38.8)	3.1	$	(144.6)	$	2,627.7	$	578.0
Fair value adjustment to redeemable noncontrolling interests in Optimal Blue Holdco, LLC	—		—		(8.6)		—		—	—		—		(8.6)		8.6
Grant of restricted shares of common stock	—		—		(25.3)		—		—	(0.5)		25.3		—		—
Forfeitures of restricted shares of common stock	—		—		0.1		—		—	—		(0.1)		—		—
Tax withholding payments for restricted share vesting	(0.1)		—		(22.7)		—		—	—		—		(22.7)		—
Vesting of restricted shares granted from treasury stock	—		—		10.4		—		—	0.2		(10.4)		—		—
Equity-based compensation expense	—		—		9.4		—		—	—		—		9.4		—
Net earnings (losses)	—		—		—		54.1		—	—		—		54.1		(8.6)
Equity-based compensation expense of unconsolidated affiliates	—		—		—		0.5		—	—		—		0.5		—
Purchases of treasury stock	—		—		—		—		—	0.6		(46.7)		(46.7)		—
Foreign currency translation adjustment	—		—		—		—		(0.3)	—		—		(0.3)		—
Unrealized gains on interest rate swaps, net	—		—		—		—		4.4	—		—		4.4		—
Other comprehensive loss on investments in unconsolidated affiliates	—		—		—		—		(3.1)	—		—		(3.1)		—
Balance, March 31, 2021	160.0	$	—	$	2,017.0	$	812.0	$	(37.8)	3.4	$	(176.5)	$	2,614.7	$	578.0

	Three months ended March 31, 2020
								Accumulated other
	Common stock			Additional		Retained		comprehensive		Treasury stock			Total shareholders’
	Shares	$		paid-in capital		earnings		loss		Shares	$		equity
Balance December 31, 2019	153.1		—	$	1,586.8	$	490.6	$	(20.2)	3.4	$	(158.7)	$	1,898.5
Effect of CECL adoption	—		—		—		(1.1)		—	—		—		(1.1)
Adjusted balance at January 1, 2020	153.1		—		1,586.8		489.5		(20.2)	3.4		(158.7)		1,897.4
Grant of restricted shares of common stock	—		—		(24.5)		—		—	(0.5)		24.5		—
Forfeitures of restricted shares of common stock	—		—		0.2		—		—	—		(0.2)		—
Tax withholding payments for restricted share vesting	(0.1)		—		(18.2)		—		—	—		—		(18.2)
Vesting of restricted shares granted from treasury stock	—		—		7.7		—		—	0.1		(7.7)		—
Equity-based compensation expense	—		—		10.7		—		—	—		—		10.7
Net earnings	—		—		—		50.1		—	—		—		50.1
Equity-based compensation expense of unconsolidated affiliates	—		—		—		0.4		—	—		—		0.4
Foreign currency translation adjustment	—		—		—		—		(0.2)	—		—		(0.2)
Unrealized losses on interest rate swaps, net	—		—		—		—		(20.4)	—		—		(20.4)
Other comprehensive loss on investments in unconsolidated affiliates	—		—		—		—		(0.2)	—		—		(0.2)
Balance, March 31, 2021	153.0	$	—	$	1,562.7	$	540.0	$	(41.0)	3.0	$	(142.1)	$	1,919.6

See Notes to Condensed Consolidated Financial Statements (Unaudited).

3

BLACK KNIGHT, INC.

Condensed Consolidated Statements of Cash Flows

(In millions)

(Unaudited)

	Three months ended March 31,
	2021		2020
Cash flows from operating activities:
Net earnings	$	45.5	$	50.1
Adjustments to reconcile net earnings to net cash provided by operating activities:
Depreciation and amortization		87.8		57.7
Amortization of debt issuance costs and original issue discount		1.0		0.7
Loss on extinguishment of debt		2.5		—
Deferred income taxes, net		(1.8)		1.1
Equity in earnings of unconsolidated affiliates, net of tax		(6.4)		(5.6)
Equity-based compensation		9.4		10.7
Changes in assets and liabilities, net of acquired assets and liabilities:
Trade and other receivables, including receivables from related parties		0.4		(1.4)
Prepaid expenses and other assets		(32.5)		(5.3)
Deferred contract costs		(11.0)		(12.8)
Deferred revenues		6.4		(0.4)
Trade accounts payable and other liabilities		(23.9)		(34.3)
Net cash provided by operating activities		77.4		60.5
Cash flows from investing activities:
Additions to property and equipment		(5.2)		(3.5)
Additions to computer software		(24.7)		(18.2)
Business acquisitions, net of cash acquired		(20.0)		(50.4)
Asset acquisitions		(10.0)		(15.0)
Net cash used in investing activities		(59.9)		(87.1)
Cash flows from financing activities:
Revolver borrowings		167.8		246.6
Revolver payments		(98.5)		(140.6)
Term loan borrowings		1.6		—
Term loan payments		—		(7.8)
Purchases of treasury stock		(46.7)		—
Tax withholding payments for restricted share vesting		(22.7)		(18.2)
Finance lease payments		(1.2)		(2.3)
Debt issuance costs paid		(7.6)		—
Net cash (used in) provided by financing activities		(7.3)		77.7
Net increase in cash and cash equivalents		10.2		51.1
Cash and cash equivalents, beginning of period		34.7		15.4
Cash and cash equivalents, end of period	$	44.9	$	66.5
Supplemental cash flow information:
Interest paid, net	$	(29.1)	$	(13.9)
Income taxes paid, net	$	(0.9)	$	(0.4)

See Notes to Condensed Consolidated Financial Statements (Unaudited).

4

BLACK KNIGHT, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

(1)Basis of Presentation and Overview

The accompanying Condensed Consolidated Financial Statements (Unaudited) of Black Knight, Inc. (“BKI”) and its subsidiaries ("Black Knight," the "Company," "we," "us" or "our") were prepared in accordance with U.S. generally accepted accounting principles ("GAAP"), and all adjustments considered necessary for a fair presentation have been included. All significant intercompany accounts and transactions have been eliminated.

The preparation of these Condensed Consolidated Financial Statements (Unaudited) in conformity with GAAP requires management to make estimates and assumptions. These estimates and assumptions affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the Condensed Consolidated Financial Statements (Unaudited), as well as the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates.

This Quarterly Report on Form 10-Q should be read in conjunction with our Annual Report on Form 10-K for the year ended December 31, 2020 filed with the Securities and Exchange Commission ("SEC") on February 26, 2021 and other filings with the SEC.

Description of Business

We are a leading provider of integrated software, data and analytics solutions to the mortgage and consumer loan, real estate and capital markets verticals. Our solutions facilitate and automate many of the mission-critical business processes across the homeownership lifecycle. We are committed to being a premier business partner that clients rely on to achieve their strategic goals, realize greater success and better serve their customers by delivering best-in-class software, services and insights with a relentless commitment to excellence, innovation, integrity and leadership.

Principles of Consolidation

The consolidated financial statements include the accounts of BKI, its wholly-owned subsidiaries and non-wholly owned subsidiaries in which we have a controlling financial interest either through voting rights or means other than voting rights. Intercompany transactions and balances have been eliminated in consolidation. Where our ownership interest in a consolidated subsidiary is less than 100%, the noncontrolling interests’ share of these non-wholly owned subsidiaries is reported in our consolidated balance sheets as a separate component of equity or within temporary equity. The noncontrolling interests’ share of the net earnings (loss) of these non-wholly owned subsidiaries is reported in our Condensed Consolidated Statements of Earnings and Comprehensive Earnings (Unaudited) as an adjustment to our net earnings to arrive at Net earnings attributable to Black Knight.

We consolidate variable interest entities (“VIEs”) if we are considered the primary beneficiary because we have (a) the power to direct matters that most significantly impact the VIE’s economic performance and (b) the obligation to absorb losses or the right to receive benefits of the VIE that could potentially be significant to the VIE.

Optimal Blue Holdco, LLC (“Optimal Blue Holdco”), a non-wholly owned subsidiary, is considered a VIE. We are the primary beneficiary of Optimal Blue Holdco through our controlling interest and our rights established in the Second Amended and Restated Limited Liability Company Agreement of Optimal Blue Holdco dated November 24, 2020 (the “OB Holdco LLC Agreement”). As such, we control Optimal Blue Holdco and its subsidiaries and consolidate its financial position and results of operations. As of March 31, 2021 and December 31, 2020, we own 60% of Optimal Blue Holdco. Redeemable noncontrolling interests represent the collective 40% equity interest in Optimal Blue Holdco owned by Cannae Holdings, LLC ("Cannae") and affiliates of Thomas H. Lee Partners, L.P. ("THL"). As these redeemable noncontrolling interests provide for redemption features not solely within our control, they are presented outside of shareholders' equity.

Reporting Segments

We conduct our operations through two reporting segments: (1) Software Solutions and (2) Data and Analytics. See further discussion in Note 14 — Segment Information.

5

BLACK KNIGHT, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) – (Continued)

(2)Condensed Consolidated Financial Statement Details

Cash and Cash Equivalents

Cash and cash equivalents are unrestricted and include the following (in millions):

	March 31, 2021		December 31, 2020
Cash	$	25.4	$	27.1
Cash equivalents		19.5		7.6
Cash and cash equivalents	$	44.9	$	34.7

Trade Receivables, Net

A summary of Trade receivables, net of allowance for credit losses is as follows (in millions):

	March 31, 2021		December 31, 2020
Trade receivables — billed	$	134.4	$	136.4
Trade receivables — unbilled		50.3		47.9
Trade receivables		184.7		184.3
Allowance for credit losses		(2.2)		(2.1)
Trade receivables, net	$	182.5	$	182.2

In addition to the amounts above, we have unbilled receivables that we do not expect to collect within the next year included in Other non-current assets in our Condensed Consolidated Balance Sheets (Unaudited). Billings for these receivables are based on contractual terms.

Prepaid Expenses and Other Current Assets

Prepaid expenses and other current assets consist of the following (in millions):

	March 31, 2021		December 31, 2020
Prepaid expenses	$	48.5	$	39.7
Contract assets, net		22.8		20.9
Other current assets		12.2		9.8
Prepaid expenses and other current assets	$	83.5	$	70.4

6

BLACK KNIGHT, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) – (Continued)

Other Non-Current Assets

Other non-current assets consist of the following (in millions):

	March 31, 2021		December 31, 2020
Property records database	$	60.5	$	60.5
Contract assets, net		61.2		56.5
Right-of-use assets(1)		37.7		41.1
Contract credits		23.8		5.0
Deferred compensation plan related assets		23.2		19.5
Prepaid expenses		3.8		4.9
Other		5.3		5.8
Other non-current assets	$	215.5	$	193.3

(1) Includes non-cash additions for right-of-use assets obtained in exchange for lease liabilities of  $2.6 million for the three months ended March 31, 2020.

Trade Accounts Payable and Other Accrued Liabilities

Trade accounts payable and other accrued liabilities consist of the following (in millions):

	March 31, 2021		December 31, 2020
Income taxes payable	$	18.7	$	13.6
Lease liabilities, current		11.4		13.5
Trade accounts payable		9.0		8.9
Other taxes payable and accrued		7.1		10.7
Accrued client liabilities		3.6		6.4
Accrued interest		3.1		12.8
Other		34.0		22.2
Trade accounts payable and accrued liabilities	$	86.9	$	88.1

Deferred Revenues

During the three months ended March 31, 2021 and 2020, revenues recognized related to the amount included in the Deferred revenues balance at the beginning of each year were $17.7 million and $15.6 million, respectively.

Depreciation and Amortization

Depreciation and amortization includes the following (in millions):

	Three months ended March 31,
	2021		2020
Computer software	$	30.6	$	25.8
Other intangible assets		38.8		13.0
Deferred contract costs		8.2		8.9
Property and equipment		10.2		10.0
Total	$	87.8	$	57.7

7

BLACK KNIGHT, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) – (Continued)

(3)Business Acquisitions

Allocation of purchase price

The purchase price of acquisitions are allocated to the assets acquired and liabilities assumed based on their estimated fair value at the acquisition date. The fair value of the acquired Computer software and Other intangible assets were primarily determined using a third party valuation based on significant estimates and assumptions, including Level 3 inputs, which are judgmental in nature. These estimates and assumptions include the projected timing and amount of future cash flows and discount rates reflecting the risk inherent in the future cash flows.

NexSpring Acquisition

On March 16, 2021, we completed the acquisition of the technology assets and business of NexSpring Financial, LLC (“NexSpring”). This solution is expected to broaden our ability to serve mortgage brokers. NexSpring’s digital lending platform will be integrated with our Empower^® loan origination system and reported within our Software Solutions segment.

Total consideration was $24.4 million, including $20.0 million paid at closing and $4.4 million of estimated contingent consideration to be paid in cash based on NexSpring revenues recognized over the three-year period subsequent to the acquisition. We recorded a preliminary allocation of the $20.0 million purchase price to tangible and identifiable intangible assets acquired and liabilities assumed based on their estimated fair values, consisting primarily of $4.6 million of computer software assets and $0.5 million of other intangible assets. The weighted-average amortization periods for these acquired assets are 5 years for computer software and 3 years for other intangible assets, respectively. We recorded $18.1 million in goodwill for the residual amount by which the purchase price exceeded the preliminary fair value of the net assets acquired. These estimates are preliminary and subject to adjustments as we complete our valuation process with respect to Computer software, Other intangible assets and contingent consideration. Refer to Note 9 — Fair Value Measurements for additional information.

Optimal Blue Acquisition

On September 15, 2020, we completed the acquisition of Optimal Blue, a leading provider of secondary market solutions and actionable data services, funded with cash on hand, debt financing and investments from co-investors Cannae and THL. Optimal Blue is reported within our Software Solutions segment because it enhances our robust set of software solutions and includes additional product, pricing and eligibility capabilities.

Total consideration, net of cash acquired was approximately $1.8 billion for 100% of the equity interests in Optimal Blue and certain affiliates. The total consideration was as follows (in millions):

Cash paid	$	1,828.3
Less: cash acquired		(29.3)
Total consideration, net	$	1,799.0

8

BLACK KNIGHT, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) – (Continued)

The following table summarizes the total purchase price consideration and the preliminary fair value amounts recognized for the assets acquired and liabilities assumed (in millions):

Total consideration, net	$	1,799.0
Trade receivables	$	11.3
Computer software		79.7
Other intangible assets		610.8
Goodwill		1,206.0
Other current and non-current assets		13.3
Total assets acquired		1,921.1
Deferred income taxes		101.4
Current and other non-current liabilities		20.7
Total liabilities assumed		122.1
Net assets acquired	$	1,799.0

The fair value of Computer Software, Other intangible assets, Goodwill and certain assumed liabilities, including estimated liabilities for pre-acquisition tax exposure, is preliminary and subject to adjustments as we complete our valuation process. During the three months ended March 31, 2021, no measurement period adjustments were recorded.

(4)Investments in Unconsolidated Affiliates

DNB Investment

Dun & Bradstreet Holdings, Inc. (“DNB”) is a global leader in commercial data and analytics that provides various services helping companies improve their operational performance. On July 6, 2020, DNB, previously a wholly-owned subsidiary of Star Parent, L.P., a Delaware limited partnership (“Star Parent”), closed its initial public offering (the “DNB IPO”) and concurrent private placement (the “DNB Private Placement”). In connection with the DNB IPO and DNB Private Placement, our limited partner interests in Star Parent were exchanged for 54.8 million shares of DNB common stock, which represented ownership of 13.0% of DNB.

We hold less than 20% of the outstanding common equity of DNB, but we continue to account for our investment under the equity method because we continue to have significant influence over DNB primarily through a combination of our investment, an agreement with certain other DNB investors pursuant to which we agreed to collectively vote together on matters related to the election of DNB directors for a period of three years following the initial public offering of DNB and our shared Chief Executive Officer.

On January 8, 2021, DNB completed its acquisition of Bisnode Business Information Group AB (the “Bisnode acquisition”). In connection with the Bisnode acquisition, DNB issued 6.2 million shares of common stock, which resulted in a decrease in our ownership interest in DNB to 12.8%.

As of March 31, 2021, we have invested an aggregate of $492.6 million in DNB. As of March 31, 2021, DNB’s closing share price was $23.81 and the fair value of our investment in DNB was $1,306.0 million before tax.

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BLACK KNIGHT, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) – (Continued)

Summarized consolidated financial information for DNB (Successor) and Star Parent (Predecessor) is presented below (in millions):

	March 31, 2021		December 31, 2020
Current assets	$	673.2	$	874.4
Non-current assets		9,251.7		8,345.9
Total assets	$	9,924.9	$	9,220.3
Current liabilities, including short-term debt	$	996.3	$	828.1
Non-current liabilities		5,250.4		4,808.3
Total liabilities		6,246.7		5,636.4
Total equity		3,678.2		3,583.9
Total liabilities and shareholders' equity	$	9,924.9	$	9,220.3

	Three months ended March 31,
	2021		2020
Revenues	$	504.5	$	395.7
Loss before provision for income taxes and equity in net income of affiliates		(33.7)		(0.6)
Net (loss) income		(23.3)		74.3
Net (loss) income attributable to DNB (Successor)/Star Parent (Predecessor)		(25.0)		41.9

Effective January 1, 2021, DNB eliminated the one-month reporting lag for certain of its subsidiaries outside North America and aligned the year-end for all of its subsidiaries to December 31. DNB applied this change in their accounting policy retrospectively. The effect of this change in accounting policy did not have a material impact to our results of operations or financial condition and was included in our current period accounting for our investment in DNB. The summarized consolidated financial information above was derived from DNB’s most recently available unaudited consolidated financial information and includes the effect of their change in accounting policy.

Equity in earnings (losses) of unconsolidated affiliates, net of tax consists of the following (in millions):

	Three months ended March 31,
	2021		2020
Equity in (losses) earnings of unconsolidated affiliates, net of tax	$	(3.5)	$	5.6
Non-cash gain related to DNB's issuance of common stock, net of tax		9.9		—
Equity in earnings of unconsolidated affiliates, net of tax	$	6.4	$	5.6

(5)Earnings Per Share

Diluted net earnings per share includes the effect of unvested restricted stock awards. For the three months ended March 31, 2021, the outstanding Optimal Blue Holdo profits interests units (“OB PIUs”) were excluded from the diluted earnings per share calculations because

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BLACK KNIGHT, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) – (Continued)

the effect of their inclusion was antidilutive. The following table sets forth the computation of basic and diluted net earnings per share (in millions, except per share amounts):

	Three months ended March 31,
	2021		2020
Basic:
Net earnings attributable to Black Knight	$	54.1	$	50.1
Shares used for basic net earnings per share:
Weighted average shares of common stock outstanding		155.6		148.0
Basic net earnings per share	$	0.35	$	0.34
Diluted:
Net earnings attributable to Black Knight	$	54.1	$	50.1
Shares used for diluted net earnings per share:
Weighted average shares of common stock outstanding		155.6		148.0
Dilutive effect of unvested restricted shares of common stock		0.3		0.7
Weighted average shares of common stock, diluted