Factset Research Systems Inc. · NYSE:FDS

Factset Research Systems — Investor Presentation (November 2021)

43 slides from Factset Research Systems's investor presentation, Nov 19, 2021

Slide 2: Forward-Looking Statements and Non-GAAP Measures
Forward-Looking Statements and Non-GAAP Measures This presentation contains forward looking statements reflecting management’s current expectations based on currently available information. Actual results may differ materially from what is expressed or forecast in such forward-looking statements. Mo
Slide 5: Key Takeaways: Compelling Business Model
Key Takeaways: Compelling Business Model Consistent long-term growth Long-term financial expectations remain strong. Strong free cash flow generation Operational excellence Investment in our workforce. Disciplined expense management. Continued margin expansion Continuing innovation and investment St
Slide 6: Client Obsession, Content Refinery, Next-Gen Workflows
Copyright © 2021 FactSet Research Systems Inc. All rights reserved 6 Client Obsession: Provide open, flexible, adaptive, solutions as part of our open ecosystem with hyper- personalized digital products to provide the next best action across the investment lifecycle Content Refinery: Provide the mos
Slide 7: FactSet At a Glance
Copyright © 2021 FactSet Research Systems Inc. All rights reserved FactSet At a Glance1 22G L O B A L F O O T P R I N T ( C O U N T R I E S ) 48O F F I C E S 10K+E M P L O Y E E S 160K+U S E R S 7 C L I E N T S 6K+ 1 Figures as of FactSet fiscal year end August 31, 2021
Slide 8: Significant Outperformance Since Our IPO 25 Years Ago
Copyright © 2021 FactSet Research Systems Inc. All rights reserved $90 $290 Significant Outperformance Since Our IPO 25 Years Ago 8 Stock Performance vs. S&P 500 (Last 5 Years) FDS (+182%) S&P 500 (+116%) Nov 20212016 2017 2018 2019 2020 1 Year 3 Years 5 Years 10 Years Since IPO1 +41% +101% +182% +3
Slide 9: FactSet Snapshot
$0 $50 $100 $150 $200 $250 $300 $350 $400 $450 $500 $3,500 $3,700 $3,900 $4,100 $4,300 $4,500 $4,700 $4,900 D e c J a n F e b M a r A p r M a y J u n J u l A u g S e p O c t S&P500 FDS FactSet Snapshot 22 years of consecutive dividend growth 41 consecutive years of revenue growth 25 consecutive year
Slide 10: Significant Opportunity to Capture Greater Share of Addressable Market
Copyright © 2021 FactSet Research Systems Inc. All rights reserved Significant Opportunity to Capture Greater Share of Addressable Market $32B Total Addressable Market1 $10B Serviceable Addressable Market1 $1.7B FactSet (FY 2021)2 Overall Trends • Shift from active to passive • Cost rationalization
Slide 11: Our Digital Platform is Critical to the Success of the Investment Community
11 Centralize Content Expanded content access | Data decision support | Enabling data science Our Digital Platform is Critical to the Success of the Investment Community Open, cloud-based platform Integrated digital products Superior client service Extensive data hierarchy and taxonomy Broad and con
Slide 12: Our Content Refinery Expands our Clients' Knowledge and Trust
Copyright © 2021 FactSet Research Systems Inc. All rights reserved Our Content Refinery Expands our Clients’ Knowledge and Trust 20% • Listings • Securities • Entities • People • Transactions • Relationships – Associations (e.g. Revenue, Frequency, History) Data Connectivity Expansive coverage, dept
Slide 13: Next-Generation Workflow Solutions Built On Our Content Refinery
Copyright © 2021 FactSet Research Systems Inc. All rights reserved Next-Generation Workflow Solutions Built On Our Content Refinery 13 S Y M B O L O G Y C O N C O R D A N C E B E S T I N C L A S S T E C H N O L O G Y B E S T I N B R E E D D A T A R E S E A R C H P O R T F O L I O C O N S T R U C T I
Slide 14: Our Clients are at the Center of What We Do
Copyright © 2021 FactSet Research Systems Inc. All rights reserved Our Clients are at the Center of What We Do 14 Transforming the way our users discover, decide, and act on opportunities using our digital platform Hyper-Personalized Products Open Ecosystem & Self-ServiceTrusted Partner ❖ Remove fri
Slide 15: Investing to Drive Growth
Content Refinery Investing to Drive Growth EXECUTION EXCELLENCE GROWTH MINDSET DIGITAL PLATFORM • Deep Sector • Private Markets • Fund Data • ESG and Thematic • Market and Reference Data • Hyper-personalization • Trusted Advisor • Open Ecosystem and Self- Service Client Obsession Workflow Solutions
Slide 16: Recent Deals Complement Our Product Offerings
Recent Deals Complement Our Product Offerings Headquarters San Francisco, CA Boston, MA Lakewood, CO Boston, MA Founded 2013 2004 2014 2011 Sponsoring SBU CTS Analytics & Trading Research & Advisory Research & Advisory Strategic Alignment ESG Portfolio Lifecycle Deep Sector Private Markets Deal Rati
Slide 17: Building the Workforce of the Future
Building the Workforce of the Future Recruit for future talent needs across content, technology, and client solutions Partner with local leaders and universities to identify educational opportunities to prepare future talent for the jobs of tomorrow Attract, develop, and retain top talent via a stro
Slide 18: Committed to Sustainable Growth in the Communities in Which We Live and Work
➢ CPD and EcoVadis filings ➢ GRI, SASB and UN Sustainable Development Goals tables published ➢ Task Force on Climate-Related Financial Disclosures (TCFD) and Science Based Targets Initiative (SBTi) Reporting (planned) Committed to Sustainable Growth in the Communities in Which We Live and Work ➢ Sus
Slide 19: Commitment to Global Diversity, Equity & Inclusion
Commitment to Global Diversity, Equity & Inclusion Copyright © 2021 FactSet Research Systems Inc. All rights reserved. Confidential: Do not forward. Inclusion, Equity & Belonging W O R K F O R C E Economic Opportunity M A R K E T P L A C E Justice S O C I E T Y We have implemented a robust diversity
Slide 20: Our Awards
Our Awards B E S T D A T A A N A L Y T I C S P R O V I D E R Inside Market Data & Inside Reference Data Award Buy-Side Technology Award Fund Technology & WSL Awards B E S T R E P O R T I N G S Y S T E M P R O V I D E R Waters Ranking Awards Wealth Briefing European Award B E S T O V E R A L L T E C
Slide 22: We Have Accelerated Top-Line Growth While Maintaining High Retention
160K+ $66 $79 $72 $78 $112 FY17 FY18 FY19 FY20 FY21 We Have Accelerated Top-Line Growth While Maintaining High Retention 90.8% 91.1% 89.7% 89.7% 91.0% FY17 FY18 FY19 FY20 FY21 GLOBAL USERS 5 Year CAGR 14% 6.5K+ GLOBAL CLIENTS 5 Year CAGR 9% 1 LTM Organic ASV + Professional Services Growth Rate is ba
Slide 23: ASV Split by Client, Geography and Business
Copyright © 2021 FactSet Research Systems Inc. All rights reserved 83% 61% 48% 17% 27% 36% 10% 17% APAC EMEA Americas Content Technology Solutions Analytics & Trading Research & Advisory Sell-Side Buy-Side 23 ASV1 Split by Client, Geography and Business Executing our strategy through three businesse
Slide 24: The Majority of our Business is Subscription-Based
The Majority of our Business is Subscription-Based 24 $1.2 $1.4 $1.5 $1.5 $1.7 $0.02 $0.02 $0.02 $0.03 $0.02 FY17 FY18 FY19 FY20 FY21 Subscription-based ASV Professional Services 98.6% 98.5% 98.5% 98.4% 98.6% FY17 FY18 FY19 FY20 FY21 $1.4 $1.5 $1.5 $1.7 Organic ASV + Professional Services Subscripti
Slide 25: Fiscal 2021 was a Record Year for Revenue and Adjusted EPS
1.2 1.4 1.4 1.5 1.6 FY17 FY18 FY19 FY20 FY21 396 426 476 503 518 FY17 FY18 FY19 FY20 FY21 $7.31 $8.53 $10.00 $10.87 $11.20 FY17 FY18 FY19 FY20 FY21 Fiscal 2021 was a Record Year for Revenue and Adjusted EPS …building on momentum of the last several years $1.6B Revenue Adj Operating margin1 Adj Dilut
Slide 26: SG&A Savings Reflect Productivity Gains and Cost Discipline
SG&A Savings Reflect Productivity Gains and Cost Discipline 25% FY17 SG&A (4)% FY21SG&A Change 21% Avg. Chg. (100) bps • Improvements in SG&A productivity and cost discipline have driven substantial margin expansion • A centralized global procurement function will enable us to continue to rationaliz
Slide 27: Technology Investment has Grown, Helping to Drive Top-Line Growth
Technology Investment has Grown, Helping to Drive Top-Line Growth 27 $786 $963 $45 $66 $177 $112 FY17 Total Expense FY17-FY21 Tech Increase FY17-FY21 Non-Tech Increase FY21 Total Expense Technology investments reflect new cloud-based product capabilities Tech Non- Tech 4% 64% 7% 60% % of Net Revenue
Slide 28: Balanced Approach to Capital Allocation
1 2 3 4 Investments (R&D) Buybacks Dividends Acquisitions Fiscal 2017 - 2021 Five Year Total $1.1B $499M $1.3B $364M Capital Allocation Philosophy ❖ Capital to re-invest in capabilities and product innovation ❖ Creating long-term value for shareholders ❖ Ensuring financial flexibility and risk manag
Slide 29: Delivering Value to Shareholders
31% 34% 28% 30% 30% FY17 FY18 FY19 FY20 FY21 81 89 100 110 118 FY17 FY18 FY19 FY20 FY21 $261 $304 $220 $201 $265 $163 $197 $241 $270 $330 FY17 FY18 FY19 FY20 FY21 Share Repurchases Avg Share Price Delivering Value to Shareholders Returned $118M in Dividends in Fiscal 2021… …and $1.25B of Share Repur
Slide 30: Financial Results for Fiscal 2021 Either Met or Exceeded Guidance
FY 2021 Guidance1 FY 2021 Results Organic ASV + Professional Services Growth $85m - $95m $112.1m GAAP Revenues $1.570b - $1.585b $1.591b GAAP Operating Margin 29.5% - 30.5% 29.8% Adjusted Operating Margin2 32.0% - 33.0% 32.5% Annual Effective Tax Rate3 15.0% - 16.5% 14.5% GAAP Diluted EPS $10.05 - $
Slide 31: Fiscal 2022 Outlook
In Fiscal 2022, We Expect to Deliver 7% or Higher ASV1 Growth and Expanded Margin 1 Organic ASV + Professional Services 2 FactSet’s expectations as of September 28, 2021. Actual results may differ materially from expectations above. 3 Growth over fiscal 2021. 4 Please see Appendix for a reconciliati
Slide 32: Key Takeaways: Compelling Business Model
Key Takeaways: Compelling Business Model Consistent long-term growth Long-term financial expectations remain strong. Strong free cash flow generation Operational excellence Investment in our workforce. Disciplined expense management. Continued margin expansion Continuing innovation and investment St
Slide 34: Financial Performance
1,221 1,350 1,435 1,494 1,591 FY17 FY18 FY19 FY20 FY21 Financial Performance 1,225 1,358 1,441 1,498 1,592 FY17 FY18 FY19 FY20 FY21 352 366 438 440 474 FY17 FY18 FY19 FY20 FY21 396 426 476 503 518 FY17 FY18 FY19 FY20 FY21 $M $M $M $M 1 Please see Appendix for a reconciliation of these non-GAAP metri
Slide 35: Financial Performance (continued)
Financial Performance (continued) 32% 31% 33% 34% 33% FY17 FY18 FY19 FY20 FY21 29% 27% 31% 29% 30% FY17 FY18 FY19 FY20 FY21 Avg 29.1% Avg 32.6% 7.31 8.53 10.00 10.87 11.20 FY17 FY18 FY19 FY20 FY21 6.51 6.78 9.08 9.65 10.36 FY17 FY18 FY19 FY20 FY21 $$ GAAP Operating Margin Adjusted Operating Margin1
Slide 36: Non-GAAP Reconciliations – FY 2021 & FY 2020
Non-GAAP Reconciliations – FY 2021 & FY 2020 Adjusted Operating Income, Margin, Net Income, Adjusted Diluted EPS (in thousands, except per share data) 36Copyright © 2021 FactSet Research Systems Inc. All rights reserved. FOR THE YEAR ENDED AUGUST 31st (Unaudited) 2021 2020 % Change GAAP Operat
Slide 37: Non-GAAP Reconciliations – FY 2020 & FY 2019
Non-GAAP Reconciliations – FY 2020 & FY 2019 Adjusted Operating Income, Margin, Net Income and Diluted EPS 37Copyright © 2020 FactSet Research Systems Inc. All rights reserved. (in thousands, except per share data) FOR THE YEAR ENDED AUGUST 31st (Unaudited) 2020 2019 % Change GAAP Operating In
Slide 38: Non-GAAP Reconciliations – FY 2019 & FY 2018
Non-GAAP Reconciliations – FY 2019 & FY 2018 Adjusted Operating Income, Margin, Net Income and Diluted EPS 38Copyright © 2020 FactSet Research Systems Inc. All rights reserved. (in thousands, except per share data) FOR THE YEAR ENDED AUGUST 31st (Unaudited) 2019 2018 % Change GAAP Operating In
Slide 39: Non-GAAP Reconciliations – FY 2018 & FY 2017
Non-GAAP Reconciliations – FY 2018 & FY 2017 Adjusted Operating Income, Margin, Net Income and Diluted EPS 39Copyright © 2020 FactSet Research Systems Inc. All rights reserved. (in thousands, except per share data) FOR THE YEAR ENDED AUGUST 31st (Unaudited) 2018 2017 % Change GAAP Operating In
Slide 40: Non-GAAP Reconciliations Free Cash Flow
Non-GAAP Reconciliations Free Cash Flow 40 (in thousands) Copyright © 2021 FactSet Research Systems Inc. All rights reserved. FOR THE YEAR ENDED AUGUST 31st (Unaudited) 2017 2018 2019 2020 2021 Net Cash Provided by Operating Activities 320,527$ 385,668$ 427,136$ 505,840$ 555,226$ Capital Expenditure
Slide 41: Technology Expense vs. Non-Technology Expense
Non-GAAP Reconciliation (Unaudited) 41Copyright © 2018 FactSet Research Systems Inc. All rights reserved. Confidential: Do not forward. (in millions) 1 Technology expenses include Hardware, Software, Communications and related expenses Technology Expense1 vs. Non-Technology Expense FOR THE YEAR ENDE
Slide 42: Non-GAAP Reconciliations Business Outlook
Non-GAAP Reconciliations Business Outlook Operating Margin, Net Income and Diluted EPS FISCAL 2022 (FULL YEAR) Low End of Range High End of Range GAAP Revenue $1,705 $1,720 GAAP operating income $ 528 $550 GAAP operating margin 31.0% 32.0% Intangible asset amortization 18 18 Transformation costs 8 8

Factset Research Systems — Investor Presentation (November 2021) on 6ix

Factset Research Systems — Investor Presentation (November 2021)

Slide 1: FactSet Overview FY 2021

Slide 2: Forward-Looking Statements and Non-GAAP Measures

Slide 3: Agenda

Slide 4: Company Overview

Slide 5: Key Takeaways: Compelling Business Model

Slide 6: Client Obsession, Content Refinery, Next-Gen Workflows

Slide 7: FactSet At a Glance

Slide 8: Significant Outperformance Since Our IPO 25 Years Ago

Slide 9: FactSet Snapshot

Slide 10: Significant Opportunity to Capture Greater Share of Addressable Market

Slide 11: Our Digital Platform is Critical to the Success of the Investment Community

Slide 12: Our Content Refinery Expands our Clients' Knowledge and Trust

Slide 13: Next-Generation Workflow Solutions Built On Our Content Refinery

Slide 14: Our Clients are at the Center of What We Do

Slide 15: Investing to Drive Growth

Slide 16: Recent Deals Complement Our Product Offerings

Slide 17: Building the Workforce of the Future

Slide 18: Committed to Sustainable Growth in the Communities in Which We Live and Work

Slide 19: Commitment to Global Diversity, Equity & Inclusion

Slide 20: Our Awards

Slide 21: Financial Review | Fiscal 2022 Guidance

Slide 22: We Have Accelerated Top-Line Growth While Maintaining High Retention

Slide 23: ASV Split by Client, Geography and Business

Slide 24: The Majority of our Business is Subscription-Based

Slide 25: Fiscal 2021 was a Record Year for Revenue and Adjusted EPS

Slide 26: SG&A Savings Reflect Productivity Gains and Cost Discipline

Slide 27: Technology Investment has Grown, Helping to Drive Top-Line Growth

Slide 28: Balanced Approach to Capital Allocation

Slide 29: Delivering Value to Shareholders

Slide 30: Financial Results for Fiscal 2021 Either Met or Exceeded Guidance

Slide 31: Fiscal 2022 Outlook

Slide 32: Key Takeaways: Compelling Business Model

Slide 33: Appendix

Slide 34: Financial Performance

Slide 35: Financial Performance (continued)

Slide 36: Non-GAAP Reconciliations – FY 2021 & FY 2020

Slide 37: Non-GAAP Reconciliations – FY 2020 & FY 2019

Slide 38: Non-GAAP Reconciliations – FY 2019 & FY 2018

Slide 39: Non-GAAP Reconciliations – FY 2018 & FY 2017

Slide 40: Non-GAAP Reconciliations Free Cash Flow

Slide 41: Technology Expense vs. Non-Technology Expense

Slide 42: Non-GAAP Reconciliations Business Outlook

Slide 43: Thank You