Good day, ladies and gentlemen and welcome to the Altisource Third Quarter 2015 Earnings Conference Call. At this time, all participants are in a listen-only mode. Later we will conduct the question-and-answer session and instruction will follow at that time. [Operator Instructions] As a reminder, this conference may be recorded. I would now like to introduce your host for today's conference, Ms. Michelle Esterman, Chief Financial Officer. Ms. Esterman, you may begin.

Thank you, operator. We first want to remind you that the earnings release, Form 10-Q and quarterly slides are available on our website at www.altisource.com. These provide additional information investors may find useful. Our presentation today contains forward-looking statements made pursuant to the Safe Harbor provisions of the Federal Securities Law. Statements in this conference call and in our press release issued earlier today, which are other than historical fact are forward-looking statements. Factors that might cause actual results to differ materially are discussed in our earnings release as well as our public filings. The Company disclaims any intent or obligation to publicly update or revise any forward-looking statements regardless of whether new information becomes available, future developments occur or otherwise. Joining me for today's call is Bill Shepro, our Chief Executive Officer. I would now like to turn the call over to Bill.

Good morning and thank you for joining today's call. This morning I plan on providing an update on the progress we’re making on our strategic initiatives and Michelle will discuss our financial performance in 2016 financial scenarios. I'm very proud of our team whose focus is on providing high-quality compliance services to our customers and positioning the company to our strategic initiatives for long-term growth. We continue to execute with existing customers onboard new customers and we see very good feedback on our offerings from the market. I'm also pleased with the financial results of the quarter, with strong service revenue, earnings per share and operating cash flow. Slide 3 provides a list of our strategic initiatives. Our initiatives in the mortgage and real estate marketplace are centered on our strategy to diversify and grow our customer and revenue base. We believe these are the right initiatives to support our growth. Each imitative addresses very large markets inline with our core competencies and provides the opportunity to leverage our competitive advantages to succeed. This morning I will discuss each initiative the contribution to 2016 service revenue assumed in our financial scenarios and the progress we're making in greater detail. Our first initiative as you can see on Slide 4 is to grow our servicer-related businesses by expanding services purchased by our existing customer base and attracting new customers. Even as delinquencies returned to historical norms, there is a very large addressable market for our services. We are one of a few service providers offering a full suite of services and technologies on a national scale. We stand to gain market shares customers consolidate to larger full-service vendors. As you can see from Slide 5 Ocwen should provide us with a long runway of earnings assuming the normal runoff of its…

Thank you, Bill. This morning we reported third quarter 2015 service revenue of $245.5 million, adjusted net income attributable to shareholders of $46.4 million and adjusted diluted earnings per share of $2.27. Slides 9 through 12 provide highlights of our results for the current quarter compared to prior period. This morning I will discuss the financial results for the quarter and our 2016 financial scenarios. Turning to service revenue. We are very pleased that third quarter 2015 service revenue was almost the same as last year. Growth in our asset management business largely offset lost revenue from the November 2014 discontinuation of the lender-placed insurance brokerage business. The full amortization of the Equator acquisition deferred revenue in November of 2014 and fewer third quarter 2015 property valuation referrals. The asset management businesses growth was primarily driven by a higher number of non-Ocwen homes sold and growth in the property and [section] and preservation business. Turning to margins. Gross profit as a percentage of service revenue in the third quarter of 2015 was the same as the third quarter in 2014. Mortgage services consistent gross profit margins, coupled with its revenue growth offset a decline in financial services gross profit margins from revenue mix. Operating income as a percentage of service revenue in the third quarter of 2015 was slightly lower than the same quarter in 2014 primarily from an increase in sales and marketing to support our growth plans. Adjusted diluted earnings per share of $2.27 in the third quarter of 2015 was 4% higher than the third quarter of 2014 driven by share repurchases and our share price. As you can see on Slide 10, we highlighted one infrequent item during the third quarter. We repurchased $11 million of our senior secured term loan at 11% discount recognizing a…

Thank you. [Operator Instructions] And our first question comes from the line of Mike Grondahl from Piper Jaffray. Your line is open.

Yes, thanks guys. A couple questions. The revenue per non-GSE loan was up at $565 per quarter. Can you talk about what's driving that up, that increase year-over-year?

Sure, Mike. Compared to the third quarter of 2014, service revenue per delinquent loan increased from higher revenue from our property preservation services. And of course this was partially offset from lower revenue from the lender-placed insurance brokerage business that was discontinued and slightly lower valuation.

Okay. And then on the four initiatives that you list on page 6, 5 through 8, I think it is, which ones do you have the most confidence in? Which two of those do you think you feel the best about?

Mike, it sort of like asking which child we like the best, but look we are very excited about each of the initiatives. I think in terms of the progress we are making right now, we feel very good on the services. On related services, we are getting great feedback and we are seeing really good RFP, strong RFPs and really good response and we’ve got an active pipeline. On owners.com, I think if we are successful, longer term, if we were to forecast that a couple of years, right now that would be our largest initiative, but of course there is a lot of wood to chop to get there. On originations, we are very encouraged by the agreements we’ve signed in the third quarter and the pipeline we are building for next year. And then on rental and renovation, as we give a competitive advantage continue to give a strong competitive advantage to RESI and they perform well. We think that represents a huge opportunity and we also think Investability and RentRange. So it's a tough question to answer. We feel really good about them, Mike and we think we can achieve what we set forth to do next year.

Got it. Yes, the detail helps. Just following up on Owners, how many markets did you say? You said something about 15 markets. Was that the end of 2015 or the end of 2016?

So Mike, we are going to launch in January in two markets, two large metropolitan areas and we think will be in 2015 by the end of the next year.

Got it. And then what were you saying, Bill, about 24 homes or 23 homes? I didn't quite follow that.

Sure. So far this year, since we launched the new site, the new experience in June, we have sold so buyers have come to us to purchase a home and we would help them buy a home and close 24 times, and when I think I said we have 22 homes under contract to close. So without really launching, we’ve just had some organic users come to us and we’ve actually helped them buy 24 homes and we have another 22 under contract. So we think that bodes well for when we actually launch the marketing.

Got it. Is your buyer's rebate - I think that's what you've been marketing there - that buyer's rebate of like 50%, is that the hook right now, do you think?

Yes and it's a little bit different in each market but, today, we are providing value. Longer-term there’s a lot more we’re going to offer buyers. And I don’t want to talkabout it too much for competitive reasons. Today, it’s value longer-term, there’s a lot more that benefit a buyer will receive by using Owners.

Got you. And lastly, could you just go into your strategy of spending $20 million buying homes and creating rentals and then I think flipping them on a six-month basis? Talk a little bit more about that strategy and why you are doing it and what you hope to learn from it?

Look, we have actually renovated 1,200 homes I think is the number a little bit more than 1,200 homes so far for our customers. And so we have a lot of experience renovating homes. We also can eliminate a lot of the friction cost associated with the business because we could be the real estate broker on the acquisition and sale of the home, we can be the title agent and the escrow agent, for example. But, Mike, the reason why we’re looking at is we have a $150 million of cash. And we think, we want to be conservative in terms of how we use that cash in the event we need it and the unlikely event we need it. But we don't like the returns we are earning on the money sitting in the bank. So if we can earn a 20% to 25% return doing something we’re very good at. In the meantime we think it's a very good use of our cash, we get to recycle the cash so it’s there should we need it and in the meantime, we get to earn a very attractive return on it and something that we know how to do.

Got it, okay. Hey, thank you.

Thanks, Mike. End of Q&A

Thank you. [Operator Instructions] And I'm not showing any further questions at this time. I would now like to turn the call back over to Ms. Esterman for any further remarks.

Yes, thanks for joining the call today and we look forward to updating you next quarter. Have a great day.

Ladies and gentlemen, thank you for participating in today's conference. This does conclude the program. And you may all disconnect. Everyone have a great day.