Broadridge Financial Solutions, Inc. · NYSE:BR
Broadridge Financial Solutions — Q3 FY2013 Earnings Presentation
23 slides from Broadridge Financial Solutions's earnings presentation, May 7, 2013
Slide 1: Earnings Webcast & Conference Call, Third Quarter Fiscal Year 2013
Exhibit 99.2 Earnings Webcast & Conference Call Third Quarter Fiscal Year 2013 © 2013 Broadridge Financial Solutions, Inc. Broadridge and the Broadridge logo are registered trademarks of Broadridge Financial Solutions, Inc. May 7, 2013
Slide 2: Forward-Looking Statements
Forward-Looking Statements This presentation and other written or oral statements made from time to time by representatives of Broadridge may contain “forward- looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Statements that are not historical in nature
Slide 3: Today's Agenda
Today’s Agenda Opening Remarks and Other Rich Daly, CEO Key Topics Third Quarter and YTD 2013 Dan Sheldon, CFO Highlights and Segment Results Summary Rich Daly, CEO Q&A Rich Daly, CEO Dan Sheldon, CFO Closing Remarks Rich Daly, CEO 2
Slide 4: Key Topics
Opening Remarks Key Topics: Financial Highlights Closed Sales Performance 3
Slide 5: Financial Highlights
Financial Highlights Solid Revenue Growth Total revenues and recurring revenues were up 5% for the quarter • Primarily due to net new business (closed sales less client losses) • Event-driven activity was slightly positive • Equity positions grew +7%, while equity trade volumes remained challenging
Slide 6: Closed Sales Performance
Closed Sales Performance Recurring revenue closed sales were up ~50% for the quarter No large transactions of >$5M Transactions of <$5M: • ICS recurring revenue closed sales were $15M vs. $10M in prior quarter • SPS recurring revenue closed sales were $9M vs. $6M in prior quarter Year-to-date recurr
Slide 7: Key Financial Drivers and Free Cash Flow
Key Financial Drivers and Free Cash Flow Historical CAGR 3Q 3Q YTD Actual Forecast (FY07-FY12) FY13 FY13 FY12 FY13 2% Total Revenue Growth 5% 4% 6% 3-4% 3% Closed Sales (Recurring) 6% 4% 3% 4-5% (2%) Client Losses (1%) (1%) (1%) (1)% 1% Net New Business 5% 3% 2% 3-4% (a) 1% Internal Growth (2%) (1%)
Slide 8: Segment Results & Forecast – Investor Communication Solutions
Segment Results & Forecast – Investor Communication Solutions Revenue/Growth EBIT/Growth (Non-GAAP) Margin/Growth (Non-GAAP) Q3: $404M / 8% $51M / 38% 12.6% / 270 bps Q3 YTD: $1,071M / 7% $95M / 69% 8.8% / 320 bps FY13: $1,695 to 1,707M / 4% $291 to 299M / 20 to 23% 17.2 to 17.5% / 230 to 260 bps FY
Slide 9: Segment Results & Forecast – Securities Processing Solutions
Segment Results & Forecast – Securities Processing Solutions Revenue/Growth EBIT/Growth (Non-GAAP) Margin/Growth (Non-GAAP) Q3: $170M / 0% $29M / +16% 16.9% / +230 bps Q3 YTD: $487M / 0% $58M / (20)% 11.9% / (300) bps FY13: $658 to 683M / 0 to +4% $79 to 102M / (13) to +12% 12.0 to 15.0% / (190) to
Slide 10: Summary
Summary Solid operating results year-to-date Recurring fee revenue continues to grow Closed sales pipeline robust Strong Foundation for Growth Diverse and well positioned products and services Service profit chain culture built on strong values High brand recognition and trust ICS strong value creat
Slide 11: Q&A
Q&A There are no slides during this portion of the presentation 10
Slide 12: Closing Comments
Closing Comments There are no slides during this portion of the presentation 11
Slide 13: Appendix
12 Appendix Bg Broadridge
Slide 14: Segment Results & Forecast – Other & Foreign Exchange (FX)
Segment Results & Forecast – Other & Foreign Exchange (FX) YTD FY13 Range 3Q13 3Q13 Low High Corporate Expenses $(8)M $(23)M $(30)M $(37)M Interest Expense, net $(4)M $(11)M $(17)M $(21)M FX - P&L - Revenue $3M $8M $13M $13M - EBIT $4M $11M $14M $14M - Transaction Activity $0M $(1)M $(1)M $(1)M Rest
Slide 15: Broadridge FY13 Q3 and YTD from Continuing Operations
Broadridge FY13 Q3 and YTD from Continuing Operations Revenue Earnings FY12 FY13 FY12 FY13 FY12 FY13 FY12 FY13 Q3 Q3 YTD Q3 YTD Q3 Q3 Q3 YTD Q3 YTD Q3 $374 $404 $1,004 $1,071 ICS $37 $51 $56 $95 1% 8% 7% 7% Growth % / Margin % 9.9% 12.6% 5.6% 8.8% $169 $170 $489 $487 SPS $25 $29 $73 $58 10% 0% 11% 0
Slide 16: Broadridge FY13 Guidance from Continuing Operations
Broadridge FY13 Guidance from Continuing Operations Revenue Earnings FY12 FY13 Range FY12 FY13 Range Actual Low High ($ in millions) Actual Low High $1,634 $1,695 $1,707 ICS $243 $291 $299 5% 4% 4% Growth % / Margin % 14.9% 17.2% 17.5% $655 $658 $683 SPS $91 $79 $102 10% 0% 4% Growth % / Margin % 13
Slide 17: Cash Flow – YTD FY13 Results and FY13 Forecast
Cash Flow –YTD FY13 Results and FY13 Forecast Free Cash Flow - Non-GAAP Unaudited ($ millions) Nine Months Ended FY13 Range (a) March 2013 Low High Free Cash Flow (Non-GAAP): Round Net earnings from continuing operations (GAAP) $ 77.5 $ 78 $ 205 $ 218 Depreciation and amortization (includes other LT
Slide 18: Recurring Closed Sales to Revenue Contribution
Recurring Closed Sales to Revenue Contribution Recurring Closed Sales to Revenue (a) (b) ($ in millions) Closed Sales Revenue Contribution Backlog Forecast Forecast Forecast FY13 FY13 FY13 ICS $50-70 ~$50-60 ~$35-45 ~Contribution to revenue growth ~3% SPS $60-80 ~$40-50 ~$85-105 ~Contribution to rev
Slide 19: Revenues and Closed Sales FY07-FY13
Revenues and Closed Sales FY07-FY13 ($ in millions) Forecast Recurring Fee Revenues FY07 FY08 FY09 FY10 FY11 FY12 CAGR FY13 ICS $ 529 $ 567 $ 594 $ 632 $ 720 $ 798 9% $862-874 Growth 3% 7% 5% 6% 14% 11% 8-10% SPS $ 527 $ 534 $ 559 $ 536 $ 594 $ 655 4% $658-683 Growth 11% 1% 5% -4% 11% 10% 0-4% Total
Slide 20: Reconciliation of Non-GAAP to GAAP Measures
Reconciliation of Non-GAAP to GAAP Measures Reconciliation of EPS Guidance 3Q12 3Q13 YTD12 YTD13 FY10 FY11 FY12 FY13 Range Actual Actual Actual Actual Actual Actual Actual Low High Guidance Provided in August 2012 - Diluted EPS (Non-GAAP) $0.28 $0.37 $0.55 $0.66 $1.56 $1.37 $1.55 $1.65 $1.75 Acquisi
Slide 21: ICS Key Segment Revenue Stats
ICS Key Segment Revenue Stats RC= Recurring Fee Revenues 3Q12 3Q13 YTD FY12 YTD FY13 Type ED= Event-Driven In millions Proxy Equities $ 31.7 $ 34.0 $ 80.1 $ 84.8 RC Stock Record Position Growth 4% 7% 1% 3% Pieces 24.5 27.1 66.1 68.1 Mutual Funds $ 5.5 $ 7.1 $ 19.3 $ 22.7 ED Pieces 6.6 13.0 29.6 36.7
Slide 22: SPS and Outsourcing Key Segment Revenue Stats
SPS and Outsourcing Key Segment Revenue Stats RC= Recurring 3Q12 3Q13 YTD FY12 YTD FY13 Type ED= Event-Driven In millions Equity Transaction-Based Equity Trades $ 35.5 $ 33.8 $ 104.7 $ 94.9 RC Internal Trade Volume 985 969 970 880 Internal Trade Growth -11% -2% 1% -9% Trade Volume (Average Trades pe
Slide 23: Broadridge ICS Definitions
Broadridge ICS Definitions Proxy Equities - Refers to the proxy services we provide in connection with annual stockholder meetings for publicly traded corporate issuers. Annual meetings of public companies include shares held in "street name" (meaning that they are held of record by brokers or banks
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