Ladies and gentlemen, thank you for standing by. And welcome to the Q3 2019 Blucora Earnings Conference Call. At this time all, participants are in a listen-only mode. After the speaker presentation there will be a question-and-answer session. [Operator Instructions] I would now like to hand the conference over to your speaker, Mr. Bill Michalek, Vice President of Investor Relations. Please go ahead, sir.

Thank you. And welcome, everyone, to Blucora’s third quarter 2019 earnings conference call. By now you should have the opportunity to review a copy of our earnings release and supplemental information. If you have not yet reviewed these documents, they are available on the Investor Relations section of our website at blucora.com. In addition, this quarter we will be referencing a set of slides that are also on the website and will be displayed in the webcast viewer. I am joined today by John Clendening, Chief Executive Officer; and Davinder Athwal, Chief Financial Officer. Before we begin, let me remind everyone that today’s discussion contains forward-looking statements based on the environment as we currently see it and speak only as of the current date. As such, they include risks and uncertainties and actual results and events could differ materially from our current expectations. Please refer to our press release and our other SEC filings, including our Forms 10-K, 10-Q and other reports, for more information on the specific risk factors. We assume no obligation to update our forward-looking statements. We will discuss both GAAP and non-GAAP financial measures today, and the earnings release and supplemental information available on blucora.com include the full non-GAAP and GAAP reconciliations. With that, let me hand it over to John.

Thanks, Bill, and good morning, everyone. I am pleased to report that we continued our momentum in the third quarter and delivered strong results, achieving the high end of our target or better on revenue, adjusted EBITDA, non-GAAP net income and non-GAAP EPS. In addition to the strong results, our integration of 1st Global is running ahead of schedule. Synergy capture is now running about $2 billion ahead of plan and we are able to consolidate both of our Wealth Management brands from a clearing platform perspective, which would allow for additional synergy capture over the long-term. Overall, a good quarter for the business. Davinder will go into more detail on our Q3 results shortly. About two years ago on this call or more than a year into my tenure with Blucora, I shared details about our multi-year transformation to that point, our business model, core beliefs, market position, strategy and opportunities. I’d like to take the opportunity today to look big picture at the business once again, albeit more briefly, in the context of where we were, where we are now and where we are going. Starting first with Wealth Management. Looking back to where we were at that time in late 2016, we were embarking on a plan to create a platform that would grow and scale, while resetting the economics of the business. We were looking to exit a restrictive legacy clearing relationship and we still announced the transition to a new clearing partner, Fidelity, over the subsequent 12-months. We have since completed that transition which has enabled us to have much greater participation in the economic decline of cash, which has resulted in the step function increase and the economic value of our business. Taking a look at the left-hand side of slide four, you can see that in the third quarter 2019, we are earning quarterly sweep cash about 5 times the level of the comparable quarter in 2016. And without the restrictions that completely capped our participation above a certain fed funds rate. This past quarter we felt two rate cuts with another last month in October and we are now running at about a $6 million to $7 million quarterly run rate. Included in this benefit is additional cash from the 1st Global acquisition and resulting incremental benefit of merging the clearing agreements. While our profitability is enhanced with this new agreement at every fed funds rate, our NOI sweep income run rate as a percentage of our consolidate adjusted EBITDA is only about 20%, significantly lower than some other players, as we are more diversified with two business segments. Along with the improved clearing position economics, we have upgraded our capabilities and advisor tools for the stack of Fidelity, eMoney and Envestnet. We believe we now have one of the best commercial grade platforms in the industry, one that advisors will find attractive, supporting organic growth and one that’s scalable, enabling inorganic growth. And finally, we shifted to looking at production for advisor as a more meaningful metric, rather than the total number of advisors to ensure that we recruit, retain and develop the advisors with the highest potential. On the front-end, we implemented predictive models and advisor recruitment to identify which tax pros are most likely to be successful as an advisor. Additionally, we proactively pruned our advisor base to remove advisors that were not engaged or productive and who accounted for virtually no assets. This positioned us to allocate more resources to remaining advisors. You can see from the chart in the right, we have almost doubled our productivity per advisor. You can see looking at this next slide, how we have performed as it relates to some of the key Wealth Management metrics, including growth in total client assets, advisory assets, the proportion of advisory assets, as well as revenue, segment income and revenue per advisor. Including 1st Global, our total client assets, advisory assets, total revenue and segment income were up respectively 76%, 158%, 82% and 78%. And our total revenue for advisors now 97% higher than it was in 2016. So moving to where we are today, we are well underway in our efforts to integrate 1st Global, an acquisition that increased our size by 50%, enhances our growth opportunities and further strengthens our position as the largest and most capable player in our differentiated segment of the market. Synergies are running ahead of schedule by about $2 million due to revenue synergies, such as asset and advisor tuition running better than expected through Q3, as well as some additional headcount and other cost synergies. I am also pleased to announce that we recently consolidated our two Wealth Management broker dealers into one with respect to our clearing platform. This is important for a number of reasons including that, number one, positions us to capture certain cost synergies sooner than previously anticipated, which further enhances the long-term valued acquisition. And two, getting this done ahead of tax season positions us to get up and running at full production as one unified advisor base sooner. The alternative would have been to wait until after tax season to consolidate, then work to get up to speed many months later. This scenario would have also left perceived obstacle ahead in advisors mind. While there are clear long-term benefits from getting this done as we planned, it also brings forward any modest disruptions that you might see around these larger events, whether that is the service metrics, organic advisor growth, advisor retention and so on. So we are also pulling forward the timing of those risks as well, which Davinder will dress in a moment. Along with consolidating with respect to clearing, we also unified the two businesses under a new brand name Avantax Wealth Management. A combination of Avant, which means original and innovative with tax, reflects our unparalleled position in the industry. With the launch of Avantax Wealth Management, we are creating a powerful brand for our business as we aim to redefine what tax smart Wealth Management means and provide superior results for our clients. Our leadership in this business is strong. As you know, about five months ago, we brought in Enrique Vasquez, a veteran in the tax focused Wealth Management arena to lead this business and he’s making great progress. With the right leadership in place, with the capability and domain knowledge needed to drive the business forward and support and enable our advisors. Finally, in Wealth Management where we are going? Here, the focus is on finalizing the integration to 1st Global and driving organic growth. As I mentioned, the integration is running ahead of plan by about $2 million 2019. Despite three cuts to the fed funds rate since the acquisition closed, which affects our sweep revenue, our cost energies are running well ahead of plan. We continue to expect to exceed our original total synergy targets. As we get up to full synergy achievement and complete integration, it will mark the close of the first chapter in the story of Avantax Wealth Management. Over the past two years, the vast majority of this organization has been focused on a clearing conversion and the subsequent combination of the two firms. There’s a great deal of work involved in getting us to this point. So I’d like to thank and congratulate the team for an incredible effort and result. And I especially like to share my personal appreciation to our incredible advisor community, which I view is the very best in the industry. This business has never been stronger and with more potential, and the stage is now set to turn our attention to organic growth. We have a great deal of opportunity to accelerate growth and an execution focused team in place to begin to capture it. As we have shared in the past, at the end of day in a business like this, effort to drive value manifest in two key ways, first, growth in total client assets, and second increased monetization of those assets as measured by revenue on client assets for Blucora. We currently have about $68 billion in total client assets. However, our advisors tax and web clients combined have an estimated $400 billion to $500 billion in investable assets. That means we could direct those 7 times to 8 times our current size, with our advisors having to introduce themselves to a single person they don’t already do business with and without us having to bring on a single new advisor. So how do we intend to capture this? First is to better enabling advisor performance. Now that we have largely completed recruiting efforts and are bringing in more productive advisors through our enhanced screening and recruiting process and putting them on a completely upgraded technology and infrastructure platform. We need to help them fully leverage these capabilities. We are focused on the advisor and the client experience, and are actively mapping and analyzing their journey and experience, identifying remaining pin points and opportunities to improve advisor and client experience. We are planning and implementing a number of improvements and implementing best practices across the business. For example, over the next few months, we will have regional support teams, supporting segmented groups advisors with service and operational support. 1st Global had great success here with small dedicated teams for more intimate service and support experience and this one has been doing with the chapter structure across what was the legacy HD Vest. Next year, we will also be rolling out a new comprehensive training and support program for the advisors, Avantax University, to better enable advisors to get off to a strong start, providing a clear a roadmap for success with regional consultants to keep them on track. We will also have an office improvement and an administrative track, that the entire advisor office be even more effective. I should note as well that these things will be accomplished to better use of existing resources rather than incremental spend. Another potentially significant driver advisor performance, as well as advisor tracks and retention is our proprietary tax smart investing or TSI platform, which is now live and being rolled out to advisors. As we have discussed with you in the past, research shows that investors unnecessarily give up 150 basis points to 200 basis points of performance each year to taxes by not deploying tax office [ph] strategies, such as tax loss harvesting, optimizing asset location and intelligent asset drawdown. Our TSI platform is designed to help advisors systematically capture tax for clients across multiple accounts. Our unique approach is designed to identify the top opportunities in advisors client base every day, and have automated the cash to that opportunity in a fraction of the time. This is a big deal for investors. Over a 30-year period, it could mean as much as $800,000 in incremental assets at retirement for an average investor. As I am sure all of you on the call would agree, this is an incredible amount of potential alpha generation. As you may recall, we launched the first module, the Tax Loss Harvester in June, making available to 250 advisors. We have continued to add and are now at more than 425 advisors, or about 10% of our base that has been trained on tool. These advisors is a very strong with common comments like this will completely change the way I approach you in conversations and enable me to have more effective conversations with more clients. And this enables us to really stand out in this business as the leader in tax smart Wealth Management. So, we see this technology as being core to our strategy and particularly when in the hands of our tax focused advisor base, to be a key differentiator and productivity enhancer for advisors. Looking ahead, we expect to launch our next module here in the fourth quarter, the capital gains analyzer, which captures and reports the annual capital gains estimates of mutual funds. This module will allow our advisors to focus more on planning and client outcomes, as opposed to data gathering. One of our top producers in the Northeast started beta testing our capital gains analyzer module, just within the last few weeks and noted one of the mutual funds he uses in advisory model has already announced an estimated capital gain that will impact over 200 of his client accounts. He can now identify losses to offset those gains for those clients in a fraction of the time that it took last year using the tax loss harvester module. We will also look to launch Version 2.0 of the tax loss harvester and perhaps a third module, all while continuing to expand to additional advisors. By the end of this year, we expect to have more than 500 advisors using the platform. We will also enable this capability and begin roll on to our legacy branded 1st Global advisors along the same timeframe. We will continue to invest in technology in 2020, giving us potential, despite the headwinds, a lower rate environment causes. So, overall in Wealth Management, we are very excited about what we have been able to accomplish in upgrading the foundations of technology, infrastructure platform, while enhancing our advisor base, focusing on productivity and investing in proprietary software with incredible potential that is already exciting advisors. With this foundation and 7x to 8x growth potential within our existing client base, you can see why we are so excited about this business. With significant visibility and runway to achieve growth through good deal of blocking and tackling in execution, as well as innovation. That said, our major near-term deliverable is to continue to execute on the integration. Moving to tax preparation, starting with where we were. Looking back, three years ago at TaxAct we operated the product fully on a legacy software code using internal servers, which made it difficult and less efficient to drive innovation. We are also priced at a very sharp discount up to 75% to the volumetric leader in the market. This led to poor unit economics, as well as a likely lower quality perception that goes along with anything with that type of hard to believe discount. So what do we do? We migrated successfully to a new cloud platform. We began to refactor our software code to make it more flexible, scalable and efficient, beginning with the back end. We worked over multiyear periods to narrow the gap and our discount to the volumetric leaders in order to create a more normalized discount while improving unit economics. While there is room for further price increases, we have clearly made substantial progress on unit economics. In online consumer software, our segment income per filer has nearly doubled the amount that was in 2016. And as we now feature a much healthier economic profile. This is of crucial importance as with a higher incremental segment income profiler, growing our marketing and technology investments improved markedly. And we still have a discount of 20% to 35% versus the volumetric leader as we head into tax year 2019. We significantly enhance the capability of our mobile app while increasing the scope to enable essentially, all users to fully complete their taxes on the app up from single-digit percentages. We also enhanced our customer support capabilities, including expanded chat support with tax specialist to help them completing return. We tested and assisted for live solution. And we tested a variety of ways to monetize our information manage. So moving to where we are today, we are finishing up for our second years and three years of code factoring on our consumer software. The work now is at a stage where the focus is on improving the client experience. In fact, improving the client experience is the number one focus of the team, which has been scouring every page and every word on the customer journey, making it easier and much more enjoyable while removing friction points requires at every level of complexity. This work will show up in a significant improved customer experience and show up drive increases in conversion in season with less leakage in the customers funnel, as well as better retention in subsequent seasons unchanged as they are focused on lifetime value. And also unchanged is our goal to offer the best overall value across the range of filers. This focus points to making some changes to our lineup and represents an investment in our value proposition. While we cannot reveal too many specifics about our plans for tax year 2019 we want to pause here and update you on decision we reached with our skew lineup. For background we launched the basic skew in a second peak of tax year 2017. And was slightly in between free and our first typical paid skew. It is designed to target the segment of the population to file 1048 that were willing to pay for a low cost product to get an improved experience into additional features. The product did very well that season and was a good contributor this past season as well. But as the industry added more features to free most notably, prior year import, and also increased the number of files that could file for free, it no longer has a logical position in the market. As this product primarily appeal to those that would otherwise file for free. We expect the removal of the product result in a headwind or one-time we resetting revenue as we moved in the next season. But it also takes away reason to not choose and return to TaxAct. On another note, we also sold our Canadian software subsidiary SimpleTax for $9.6 million this quarter to focus on our core business. This will also be an adjustment to our revenue run rate. Similar to Wealth Management I believe our leadership in this business is very strong. Curtis Campbell joined Blucora in October 2018. So this upcoming season being his first full cycle at the helm driving strategy, preparation and execution. He’s continued to bring in strong talent and has focused the business in the right places and will be better positioned to participate in a tailwind in the digital DIY space than ever. Finishing up in tax preparation to where we are going, having stabilized monetize units over the past two seasons while raising prices to a fair degree. Going forward, we are looking for more balanced growth across units and pricing with competitive skews that are normalized smaller discount with differentiated position in the marketplace will become apparent in 2020. In short, we need to win and grow through a four part strategy, including a large attitudinal segment that is looking for a forward leaning approach to improve their financial position, not just completing this year’s taxes, leveraging our improvement unit economics, delivering a superior client experience, while also increasing the differentiated position, maintaining better value with moderate price increases and increasing ARPU through new initiatives which may include an assisted offering, which will more fully test and explore in tax year 2019. For clarity, our focused on a new segmentation along with investments and the client experience is not at least been in conflict with an LTV approach to this business. In fact, the opposite is true. Our investments in the client experience will benefit all filers, regardless of whether they are a paying customer in year one or not. Likewise, while we will not dedicate specific marketing spend to attract free year one filers, we leave our approach in messaging will position us to capture more of these filers at no incremental costs. In addition, with this focus on the core, the tax preparation experience, with the emphasizing for the time being partnership efforts unless they contribute directly to improving the tax filing experience. As a part of this, we will repurpose our blueprint analysis to support our approach optimizing the tax filers tax position, providing insights to all filers. Altogether, I continue to be more excited than ever about the prospects of this business. We will share more down the road. But I will close out tax preparation by noting the key drivers of a high level of confidence heading into the year. First, we will have improved branding and messaging with our testing indicates can drive increase quality and quantity of traffic. Second, we will have a significantly improved core product experience, supported by analytics indicate we are focused on here that can most increase conversion. Third, we will be launching new branded product features, which are custom research tells us will have a strong appeal and differentiation. Fourth, while we will still take some pricing, we will be more moderate which would drive improvements in retention. Lately we will remove a skew that is no longer relevant and is dampened conversion. And last but not least, we have brought in a seasoned team with strong industry and functional experience. Moving to the corporate level, you can see our consistent growth and keep an annual metrics as we reduce debt, what was four times net leverage at the end of 2016 to 2.1 times today and strengthen our balance sheet. In the second quarter of this year, we closed the acquisition of 1st Global which is very much an on strategy accretive acquisition that advances our goals and improves our position. From a capital allocation perspective in the near term, we will be aggressively focused on integration and ensuring we achieve the full potential of this acquisition. And you should expect us to be disciplined about the leveraging, just like you saw after HP Vest acquisition. Overall, our capital allocation philosophy remains unchanged and is to maximize shareholder value creation from a set of available opportunities. We have been focused on funding organic growth opportunities and debt reduction. As in the past, attracted M&A would be in our consideration set should present itself along with continued opportunistic share repurchase. Our share repurchase program executed this last quarter and Davinder will provide a few more details on that in a moment. In summary, the company has demonstrated strong long-term financial performance, while laying the groundwork for future growth. Our third quarter results are favorable exceeding our targets and with acquisition synergies are running ahead of plan. That was there additional headwinds with the recent cuts in the fed funds rate and a less certain overall economic environment. However, with a favorable position, it comes with its strong and well positioned core business and a highly capable leadership team committed to long-term growth. I am excited about the opportunity ahead of us and optimistic about our future.

Thanks, John, and good morning, everyone. I’d like to provide some additional detail on the third quarter results and updated outlook for the full year 2019, as well as a preliminary outlook for the upcoming tax season. Consolidated third quarter results, which include growth global for the full period were total revenue of $149 million, which is at the high end of our guidance range. Adjusted EBITDA of $2.1 million above the high end of target range, non-GAAP net loss of $9.6 million or $0.20 per share, both at the high end of range and GAAP net loss of $62.4 million or $1.28 per share, which includes the $51 million noncash impairment charge related to the HD Vest trade name partially offset by the gain from sale of SimpleTax. In terms of certain performance and beginning with Wealth Management, revenue was $145.4 million and segment income was $20.6 million, although, which were toward the high end of our target ranges. A portion of favorability royalty for midpoint of the guidance range is due to [inaudible] expected advisor and asset retention to Q3. On a pro forma basis Wealth Management revenue is up 8% year over year, driven by sweep revenue, which is up by about 90%, as well as advisory and transactional and mutual fund revenue, which were all up in the 8% to 9% range. Net inflows into advisory assets in the third quarter were about $225 million and we ended the quarter with $26.3 billion in advisory assets. Total client assets were approximately flat versus last quarter and we ended the third quarter with a combined $67.7 billion. Advisory asset as a proportional of total client assets ended the quarter at 38.9%. Recruiting performed well in Q3. Our platform recruited about 40 new tech professionals into Wealth Management. In addition, we also attracted a handful of established advisor transfers to the combined $150 million in client assets that will soon begin to move over to our platform. Similar to last quarter, lot of transfer were from RIA, while RIA are not an everyday occurrence, our strong compliance support and product offerings enabled advisors [inaudible] growth is compelling. Last, but not least, we also had another large accounting firm, which has an estimated $1.2 billion in client asset prospecting opportunities. Looking here for a moment to the integration of a Wealth Management business, and as John noted, we are pleased to report that the company were in significantly ahead of plan, as part of a modeling of the acquisition we had assumed about $3 million of synergy realization in 2019, but we now expect to be around $2 million above that goal at about $5 million. Similarly, we had originally models synergy realization of $8 million in 2020, we now believe synergy will exceed $10 million next year, even after taking to account the three cuts from the fed funds rate since the acquisition, which as you know has an adverse effect on free income. The better than expected synergy performance will give you identification and capture of additional cost savings opportunities as we execute our integration plan, as well as the acceleration clearing conversion into 2019. Moving on to tax prep. TaxAct revenue for third quarter was $3.6 million, up 2.6% versus the prior year. Segment loss was $12.1 million, up by about $5 million versus the prior year, driven primarily by the code refactoring and our latest product investment work that we discussed last quarter. One note to add here, in the third quarter, we reclassified $960,000 a third quarter professional tax prep revenue into deferred revenue for pre sales related to tax year 2019, which has the recording of revenue in the second quarter. This adjustment reduces FY19 revenue and trying to serve it to the first quarter of 2020. However, there is no impact on FY19 segment income as we have been able to mitigate the impact of the deferred revenue to OpEx management. Finishing up on third quarter performance, unallocated corporate expenses were $6.5 million, which is wider than we expected you the timing of certain items between quarters. Moving on to liquidity, we end of the quarter with cash and cash equivalents of $97.5 million, and our net debt was $292.5 million, resulting in a net leverage ratio of 2.1 times at the end of September. During the quarter, we began putting some of this balance sheet transfer work by initiating new purchases of common stock. In total, we repurchased approximately 560,000 shares at an average price of approximately $22.50 per share, for a total of about $12.7 million in repurchases, representing about 1% of our shares outstanding. As a reminder, we have authorization to repurchase up to $100 million. Finally, as it relates to integration costs and in the third quarter we recorded $6.8 million. These costs have broken out on a separate line in on supplemental so you can crack them. And they were added back for purposes of reporting adjusted EBITDA. We have previously indicated that expect a total of $28 million in integration expense of 1st Global is roughly $10 million in 2019 and the balance in 2020. We also indicated our goals with accelerated much of the integration activity into 2019 is possible to maximize the long-term benefit and that if you were successful in doing that more of that cost will fall into 2019 as well. As I mentioned earlier, we were in fact able to pull more into 2019 more specifically the clearing conversion, we expect the breakdown to be close to the $17 million in 2019, with a balance in 2020. With that, let’s turn to a full year outlook for 2019. For the full year, we expect TaxAct revenue of between $209.5 million and $210.5 million and segment income of $93 million to $94.5 million For our Wealth Management business, we expect full year revenue, which includes 1st Global for the period of May 6th through the year end of $505 million to $510 million and segment income of $67 million to $69.5 million. This translates to consolidate full year outlook, again including 1st Global for the partial year of revenue between $714.5 million and $720.5 million, adjusted EBITDA of $130.5 million to $135.5 million, non-GAAP net income of $93.5 million to $99.5 million or $1.88 per diluted share to $2.01 per diluted share and GAAP net loss attributable to Blucora of $0.4 million to $5.4 million or $0.01 to $0.11 per diluted share with $28.5 million to $29.5 million in corporate unallocated expense. So as you can see, while third quarter results were ahead of our target. We are not rolling that into the full year guidance. There were a few factors that are driving that. First, as you know, there’s an additional rate cut to the fed fund rate in October that was not contemplated and our guidance, which will impact revenue. Second as John noted, while we were able to accelerate the timing of the current consolidation related to the integration of 1st Global, which has a long-term net positive, it also pulled forward the timing of any moderate churn or disruption that we make to in the near-term. As a result, we are taking more conservative view to things like integration related, transactional revenue, asset flows, retention and payout. Third, while the fourth quarter retention seasonally strong, the current economic climate also points to a more conservative view to transactional revenue that flows across the business. And finally we have continued to see relatively stronger growth in Ohio paid advisor [ph], which has led average payout to be higher in the near-term. Finally, as we look ahead to next tax season and its contribution to the strategy for maximizing the segments long-term growth prospects as outlined by John really incorporated a number of factors into our preliminary outlook for the first half of 2020. Specifically, while TaxAct has consistently grown revenue well above market rates a number of years now, and recent growth has been driven mostly by pricing or we sought to improve our unit economics and the lifetime value of our customers. In terms of this pricing work that we have been executing over the last few years, we are now in a strong position to derive growth from both volume and price and a revolt returned to overall unit growth. We are making the right investments and great improvement already strong product experience is updated branding and marketing to improve conversion and retention. To be most competitive in the market, we will remove our basic skew and make a few other adjustments that will result in a one year reach that or headwind of about $17 million in 2020. The sale of SimpleTax has also been reflected in our growth rate assumptions. Incorporating these factors and taking a more conservative view in this transition year. For the first half of 2020, we are targeting at TaxAct segment margin in the range of 56.7% to 57.7%, which is consistent with the prior year, but revenue will grow in line with market in the 3% to 5% range versus a comparable prior year period. Normalizing for the removal of basic and the sale of SimpleTax will result in an equivalent year-over-year growth of about 11% in revenue and 15% in segment income. This concludes our prepared remarks. And we will now turn the call over to the operator for Q&A. Operator?

Thank you. [Operator Instructions] Our first question comes from Brad Berning from Craig-Hallum.

Good morning guys. Good progress on the Asset Management business. I just wanted to follow up a little bit further and make sure to clarify with it. We understand the last commentary on the tax season. So the revenue guide for 3% to 5% revenue growth for first half tax season per capita next year with tax season that is after the $17 million headwind for removing the basic skew or is that prior to removing that, just want to make sure that’s clear?

Thank you, Brad. Good morning. This is Davinder. Thanks for the question. Yeah. That is actually prior to that, I am sorry, after the headwind. It is include the…

After the headwinds,

… the headwind. Yeah. Right.

Yeah. Okay. Just wanted to make sure that that was really clear. You also talked about synergies on the asset management of business, going forward. And I wanted to just make sure we understand, is that the items that you have already clarified and it’s mostly to do with the cost and timing of synergies or are you talking about additional potential revenue synergies that you are identifying and just want to talk about what you are seeing for the opportunities from a synergistic standpoint, both cost and revenues.

Brad, hey, John here. Thanks for this question as well. It’s really more the former that team’s been working tirelessly to bring forward the positive benefits of having acquired 1st Global around cost structure bringing teams together, re-pointing if you will around the clearing a partner. So it’s, it’s really most of those opportunities. Having said that, we have identified some opportunities around each of the ways the different businesses go to market, which we are looking to capitalize on. But, suffice to say that the implications for how we have talked about synergy is really around having brought forward those advantages. Of course, we have had to absorb now a third rate cut and still are over making, what we thought we would be at this point as well as for next year.

Understood. I will get back in the queue. Thanks a lot.

Thanks, Brad.

Thank you. Our next question comes from Will Cuddy with JPMorgan.

Good morning. Thanks for taking our questions. Just first on Wealth Management. So a nice healthy uptake in advisor productivity, but the advisor number of advisors continues to fall. Could you speak a little bit about more about what’s driving the decrease in advisors is primarily legacy HD Vest or 1st Global and then how long will the platform consolidation remain an overhang on advisor growth?

Well, good morning. Thank you for that question as well John, John here. So with regards to the status on counts, as you noted, we were down but the changes almost entirely on the HD Vest side. And consistent with our prior commentary on this, this is associated with advisors with minimal productivity and production that left like many frankly, have left the industry as well. There would be some small number there that just didn’t complete their record ad or whatever retired, that sort of thing. But the headline there is it’s around unproductive advisors, the vast majority which would be just to put a number on it, folks blow less than like $5,000 in production so really a de minimis impact with regard to overall revenue and things on those lines. Now, so the selling point you raised as well around well, how long can we expect some disruption on the business based on the conversion? In our experience, this is a far less impactful conversion from the kind of then the clearing conversion from the standpoint of gosh I do my business very differently. It’s not as impactful there. There are some impacts there, but the other element here of course, is that as we bring together two teams, and say, consistent with the principle we have shared with you guys, with advisors and employees, around choosing the very best leadership team, relationship managers and those sorts of things there will be some change in connectivity with some of the people that you have grown quite familiar with, and we are very good contributors for us. And so we are essentially rebuilding relationships is what that means, in some cases. In a business like this, advisors really like the TLC that we want to give them and some of that’s been disrupted. So having said that we are rebuilding relationships we will come out in February, with a firmer sense of obviously we will do guidance for the year on that business and I will talk further about it. But I’d expect it to be a quarter or so probably as the -- it’s really initial and probably the most difficult sort of wind to insert headwind to fight against.

Great, thanks, John. Following up on that, did you have a rough idea of how many more unproductive advisors are still remaining in the 4000 on the platform?

You know, I guess the way to characterize it right why because of course we have got a broad range of advisors that go from just beginning the business. We are working really hard so we get lift off. Those have been added for a couple years. So we kind of take a vintage look at the business and all the way up to folks that are cruising at a level you would see it at, some of the biggest producers at some other firms. And so there’s going to always be a little bit of a number of advisors who opt out or, we may steer them to actually sell their business to another advisor, things along those lines. But it’s important to share to that we have completed the bulk of the proactive nudging, if you will, of advisors. We still have some very low minimums around production and that sort of thing. But it’s important to take away that we at this stage have completed the bulk of the programmatic let’s proactively, try to get people to get in or move on. And so be more of a steady state of folks that retire, maybe passed away sell their practice internally, hopefully, and that sort of thing. So the largest part of that is behind us now, as you know, our orientation for the comment also is around driving growth and driving productivity. And we feel like the sooner we get more and more advisors to adopt our tax we are investing. And hopefully this 500 number at the end of the year will make it even easier to see how they can initially add value, which gets over a little bit of the hump that we always face with the CPA type community because they are pretty conservative in nature its good, right. They are not swinging for the fences, but they want to be able to sell practical solutions with fair value PSI will be something that helps enable advisors to do that we think we are successful.

Okay. Great. Thanks, John.

Thanks.

Thank you. [Operator Instructions] Our next question will come from Chris Shutler with William Blair.

Hey guys. Good morning. On TaxAct how confident are you that you can return to positive unit growth in 2020?

So Chris thanks for the question. Good morning as you know, we don’t guide to unit volume. But clearly our goal is to get back to overall unit growth each year. We spoke about that, like two calls ago for the first time. And with the removal of our basic, let’s be clear about it, since that was a monetized unit. We likely won’t be forecasting a growth in monetized units, as we do the one-time reset on that. However, we are very confident in the idea of seeing terrific progress in all the indicators of a long term growth business here in TaxAct, like I have shared a lot already upfront, but to amplify it. As we picked apart the experience, literally as I counted page by page, word by word looking for ways to simplify and make it easier. We see large opportunities in improving the conversion rate. And we really think we are on to something with regard to the segmentation work that we have done. That’s turning both into wealth tested by the way it’s turning into new ways to communicate our brand and our value proposition, along with real value to consumers that they are going to see in the following experience itself. So our confidence level on the right track here is actually never been higher than it is right now. And certainly, some of that goes with the sort of team that had now had a chance to essentially last one year, if you will, from the kind of reload on leadership and its business, all the folks that come with it. So always saying we are clearly looking for more balanced growth. We think we have got a really well grounded approach to get us there and now is the time to be shifting in that direction. And we believe that we can fight through the economic impacted as the first caller had sort of clarified and still drive revenue and income growth while dealing with a one-time, sort of hold cleared by the ski cleanup.

Okay, thanks for that. And I wanted to dig into this a little bit more. I think Davinder said that the tax guidance I think correct me if I am wrong, he said it was potentially a conservative view. Given all the changes in play this coming season maybe just walk us through the process of how you actually built the guidance. Is that your expectation that the basic skew folks will basically move into free and that you will have an opportunity to monetize them either in season or in future seasons. And then what are you thinking about, from a pricing standpoint, that the magnitude of a price increase relative to past seasons?

Hey, Chris. Good morning. It’s Davinder. I will take that question for me kind of maybe just start off by saying a lot of changes taking place this year, right. So we are kind of in a transition year, which makes it somewhat harder to predict than being in more of a steady state scenario. So that’s really why we are being more conservative, we don’t want to get ahead of ourselves, thinking we know more than we actually do. And in terms of pricing, you know, we said in the past, we have had 25% to 30% discount against other competitor of skews we think that’s kind of where we are going to go into this year with, but as you think about some of the other things that are happening. If I move from purely being a price based scorer to more of a, balanced score between volume and price, just think kind of hard to predict, given that we haven’t had as much of that in the last few years. So again, just to reiterate the point where that’s what’s causing us to be more conservative on the tax side played though you may be ordinarily.

The only thing to amplify there, as well as is we have a well modeled view of this business with a very detailed way of thinking about every aspect of conversion from traffic down through hidden the file button. And it’s been that those analytics which as we have shared before, we have only been rapidly building the last year and a half or so. And so while we have that sort of detailed understanding, and no more so than ever, where we are going to be during the course of the year as it unfolds. As you know in diameter, so there’s a lot of change here that’s for sure. But we feel like the modeling and the consumer research that we have done all points to the sort of guidance that we have shared. I think here on pricing to is as we shared for a couple of quarters and has been on our minds sometime now. We are looking forward to getting into a point where it’s not the season clearly. But we are looking forward to getting a point where we only grow pricing with the market and take away some of the kind of retention challenges that above market increases in pricing drives. So we head into the year with a point of view on where we feel like the largest gaps are that we can continue to close maybe a little bit more aggressively than some of the other SBUs [ph] and we will stay nimble in the season as well. But we think that we have got some math right as we think about LTV on this business where - as you know that’s how we focus everything here, as we have got the LTV right and the analytics around that so that as we increased price less over a few seasons at the same time and add value right back with regard to some of the filers that the increases in folks that start and close will, produce value for shareholders over time. One of the thing you mentioned free and how we think about free aid [ph] another opportunity to be super clear here. Very true that and important to note that are economic situations vastly different. The slides probably made that abundantly clear when you are in a business where you have a competitor many, many times your size and also your unit economics still in comparison. You have got to address that. And we chose to address unit economics first and now we are looking to address volume and growth and scale and those sorts of things. But the way the math has changed has made it so that if we can bring in folks that don’t file for three in year one at no incremental cost due to the strength of our message, that’s a good thing, because hasn’t cost us anything incrementally, and we have got the opportunities that those percentage of folks that year two, three, four or whatever it might be, end up being a paying customer that math now works a few years ago. It would be like, well, gosh, is that, just the rate of that doesn’t work because the prize at the end of it, [inaudible] too small. We are not going out and looking for fee filers. We are looking to increase the interest with which everybody has in our brand and in so doing, we increase LTV.

All Right. Thank you.

You bet.

Thank you. I am showing no further questions in the queue at this time. I would now like to turn the call back over to management for any closing remarks.

Well, thank you all for joining us today. I hope the deeper dive was helpful for you in understanding our business, our growth and opportunities. We look forward to continue to update you all on our progress. Thanks everybody. Have a good rest of the day.

Ladies and gentlemen, this concludes today’s conference call. Thank you for your participation. You may now disconnect.