Broadridge Financial Solutions, Inc. · NYSE:BR
Broadridge Financial Solutions — FY2011 Earnings Presentation
30 slides from Broadridge Financial Solutions's earnings presentation, Aug 11, 2011
Slide 1: Earnings Webcast & Conference Call
Exhibit 99.2 Broadridge Financial Solutions, Inc. Earnings Webcast & Conference Call Fourth Quarter and Fiscal Year 2011 © 2011 Broadridge Financial Solutions, Inc. Broadridge and the Broadridge logo are registered trademarks of Broadridge Financial Solutions, Inc. August 11, 2011
Slide 2: Forward-Looking Statements and Non-GAAP Measures
Forward-Looking Statements and Non-GAAP Measures 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
Slide 3: Today's Agenda
Today’s Agenda Opening Remarks and Key Topics Rich Daly, CEO Fourth Quarter and Fiscal Year 2011 Dan Sheldon, CFO Results and Fiscal Year 2012 Guidance Summary Rich Daly, CEO Q&A Rich Daly, CEO Dan Sheldon, CFO Rick Rodick, VP Investor Relations Closing Remarks Rich Daly, CEO 2
Slide 4: Opening Remarks Key Topics
Opening Remarks Key Topics: Financial Highlights Fiscal Year 2012 Guidance Closed Sales Performance Acquisition Update 3
Slide 5: Fiscal Year 2011 Financial Highlights
Fiscal Year 2011 Financial Highlights Financial performance for the quarter in line with expectations Revenues for the year declined 2% However recurring revenues were up 12% ($143M) Full year Non-GAAP $1.37 and GAAP $1.34 diluted earnings per share from continuing operations Down from prior year pr
Slide 6: Fiscal Year 2012 Guidance
Fiscal Year 2012 Guidance Fiscal year 2012 guidance Revenue growth 8-10% Non-GAAP fully diluted earnings per share from continuing operations of $1.50-1.60, excluding IBM migration costs, representing 9-17% growth Free cash flow of $225M (mid-point of range), excluding IBM migration costs Increasing
Slide 7: Closed Sales Performance
Closed Sales Performance Total closed sales for the year were $134M Recurring revenue closed sales were $113M for the year SPS full year closed sales of $50M were up 25% as compared with the prior year primarily due to >$5M deals ICS full year recurring revenue closed sales of $63M were down ~$15M o
Slide 8: Acquisition Update
Acquisition Update During the last three years we have made five $15M+ acquisitions in which we spent approximately $370M Three of the acquisitions occurred this year at a cost of approximately $295M The acquisitions contributed approximately $109M to revenue, $17M to EBITDA and $3M to EBT in fiscal
Slide 9: IBM Data Center Migration – Q4 FY11, FY12 & Beyond
IBM Data Center Migration – Q4 FY11, FY12 & Beyond Are in the final stages of planning with IBM Still expecting ~$25M in average annual savings over the contract service life which includes the impact of deferred cost amortization Total BR migration costs currently estimated at ~$95M BR cost of ~$30
Slide 10: Revenue Growth Drivers
Revenue Growth Drivers Historical CAGR Actual Forecast (FY05-FY10) FY11 FY12 6% Total Revenue Growth (2)% 8-10% 4% Closed Sales (Recurring) 3% 4-5% (2)% Client Losses (1)% (1)% 2% Net New Business 2% 3-4% 3% Internal Growth (a) 1% 0-1% 0% Acquisitions 4% ~2% 5% Total Recurring 7% 5-7% 1% Event-Drive
Slide 11: Segment Results & Forecast – Investor Communication Solutions
Segment Results & Forecast – Investor Communication Solutions Revenue/Growth EBIT/Growth (Non-GAAP) Margin/Growth (Non-GAAP) FY11: $1,559M/ (7)% $213M/ (22)% 13.7%/ (260) bps FY12: $1,707 to 1,718M / 9 to 10% $254 to 263M / 19 to 23% 14.9 to 15.3% / 120 to 160 bps FY11 revenue and margins in line wi
Slide 12: Segment Results & Forecast – Securities Processing Solutions
Segment Results & Forecast – Securities Processing Solutions Revenue/Growth EBIT/Growth (Non-GAAP) Margin/Growth (Non-GAAP) FY11: $594M / +11% $87M / (12)% 14.7% / (380) bps FY12: $631 to 647M / +6 to +9% $99 to 115M / +13 to +31% 15.7 to 17.7% / +100 to +300 bps FY11 growth primarily due to on-boar
Slide 13: FY12 Continuing Operations Financial Guidance Summary
Broadridge - FY12 Continuing Operations Financial Guidance Summary Revenue growth in the range of 8-10% Recurring closed sales forecast for the year at $110-150M Earnings before interest and taxes (excluding IBM migration costs) growth of 13- 20% (Non-GAAP) and margin of 13.8-14.4% (Non-GAAP) Dilute
Slide 14: Exiting FY12 and moving into FY13
Broadridge – Exiting FY12 and moving into FY13 FY12 Non-GAAP Diluted EPS guidance $1.50-1.60 Key initiatives expected to deliver on annualized basis: IBM - ~$0.12 MSSB/Restructuring - ~$0.06 Assuming event-driven revenues begin to return to “historic normalized levels” - Fee revenues FY12-13 increas
Slide 15: Summary
Summary Fiscal year 2011 results are not reflective of the value-creation foundation that has been grown and expanded during the year Due to the decline in event-driven revenues However recurring revenues continued to grow Strong recurring revenue closed sales, second highest in our history Strong c
Slide 16: Q&A
Q&A There are no slides during this portion of the presentation 15
Slide 17: Closing Comments
Closing Comments There are no slides during this portion of the presentation 16
Slide 18: Appendix
Ce ee Appendix Appendix 7 Ba Broadridge
Slide 19: Segment Results & Forecast – Other & Foreign Exchange (FX)
Segment Results & Forecast – Other & Foreign Exchange (FX) FY12 Range 4Q11 FY11 Low High Other Fees Revenue $0M $0M $0M $0M Other Fees Margin $0M $0M $0M $0M Interest Expense, net $(2)M $(8)M $(17)M $(17)M Corp. Expenses & Investments including IBM $(14)M $(31)M $(69)M $(76)M FX - P&L - Revenue $7M
Slide 20: Broadridge 4Q and FY11 from Continuing Operations
Broadridge 4Q and FY11 from Continuing Operations (a) FY11 excludes the IBM migration costs of $6M, after-tax $4M, or $0.03 EPS impact. (b) Includes impacts of FX P&L Margins and FX Transaction Activity (c) FY10 excludes the release of a valuation allowance on a deferred tax asset relating to tax lo
Slide 21: Broadridge FY12 Guidance from Continuing Operations
Broadridge FY12 Guidance from Continuing Operations (a) FY11 excludes the IBM migration costs of $6M, after-tax $4M, or $0.03 EPS impact. FY12 Range Low & High excludes the estimated IBM migration costs of $33M, after-tax $21M, or $0.16 EPS impact. (b) Includes impact of FX P&L Margin and FX Transac
Slide 22: Cash Flow – FY11 Results and FY12 Forecast
Cash Flow – FY11 Results and FY12 Forecast Unaudited (In millions) Year Ended FY12 Range (a) June 2011 Low High Free Cash Flow(Non-GAAP): Net earnings from continuing operations per GAAP $ 172 $ 172 $ 184 Depreciation and amortization (includes other LT assets) 72 95 100 Stock-based compensation exp
Slide 23: Closed Sales to Revenue Contribution
Closed Sales to Revenue Contribution (A) Recurring Closed Sales to Revenue ($ in millions) Forecast (C) (D) Recurring FY09 FY10 FY11 FY12 ICS $55 $80 $65 $65-85 ~ Revenue Contribution Year 1-3 55% 35% 10% 50% 50% 0% 45% 45% 10% 40% 35% 25% (B) SPS $30 $40 $50 $45-65 ~ Revenue Contribution Year 1-3 3
Slide 24: Revenues and Closed Sales FY05-FY12
Revenues and Closed Sales FY05-FY12 ($ in millions) FY05-10 Forecast FY11-12 Recurring Fee Revenues FY05 FY06 FY07 FY08 FY09 FY10 CAGR FY11 FY12 Growth Rates ICS $ 444 $ 513 $ 519 $ 558 $ 583 $ 610 7% $ 650 $706-715 9-10% Growth 16% 1% 8% 4% 5% 7% SPS $ 459 $ 458 $ 509 $ 515 $ 537 $ 513 2% $ 522 $54
Slide 25: Reconciliation of Non-GAAP to GAAP Measures
Reconciliation of Non-GAAP to GAAP Measures EBIT Reconciliation 4Q10 4Q11 FY10 FY11 FY12 Range ($ in millions) Actual Actual Actual Actual Low High (a) & (b) EBIT (Non-GAAP / excluding IBM migration costs) $185 $190 $352 $285 $323 $343 Margin % 24.6% 24.4% 15.9% 13.1% 13.8% 14.4% Interest & Other ($
Slide 26: One-time Items (For Informational Purposes Only)
One-time Items (For Informational Purposes Only) (a) Estimated for Informational Purposes Only. Included are other items that management believes should be excluded from the GAAP financials when assessing the overall business performance. (b) Deal Costs include only costs related to closed transacti
Slide 27: ICS Key Segment Revenue Stats
ICS Key Segment Revenue Stats $ in millions RC= Recurring ED= Event-Driven (1) Consolidated Pre-sale and Post-sale Fulfillment and reclassified Pre-sale from event-driven to recurring revenues. (2) Other Recurring Fee Revenue includes Matrix, NewRiver, StockTrans, Access Data, Forefield and Tax Repo
Slide 28: SPS and Outsourcing Key Segment Revenue Stats
SPS and Outsourcing Key Segment Revenue Stats All Revenues are Recurring $ in millions [1] 4Q10 Internal Trade Volume was previously reported as 1,581 and 287 for Equities and Fixed Income, respectively. FY10 Internal Trade Volume was previously reported as 1,507 and 269 for Equities and Fixed Incom
Slide 29: Broadridge ICS Definitions
Broadridge ICS Definitions 28
Slide 30: Use of Material Contained Herein
Use of Material Contained Herein The information contained in this presentation is being provided for your convenience and information only. This information is accurate as of the date of its initial presentation. If you plan to use this information for any purpose, verification of its continued acc
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