Broadridge Financial Solutions, Inc. · NYSE:BR
Broadridge Financial Solutions — JP Morgan FinTech and Specialty Finance Forum 2016
21 slides from Broadridge Financial Solutions's conference presentation, Nov 30, 2016
Slide 1: JP Morgan FinTech and Specialty Finance Forum
JP Morgan FinTech and Specialty Finance Forum November 30, 2016
Slide 2: Forward-Looking Statements
1© 2016 Forward-Looking Statements This presentation and other written or oral statements made from time to time by representatives of Broadridge Financial Solutions, Inc. ("Broadridge" or the "Company") may contain “forward-looking statements” within the meaning of the Private Securities Litigation
Slide 3: Use of Non-GAAP Financial Measures
2© 2016 Use of Non-GAAP Financial Measures Explanation and Reconciliation of the Company’s Use of Non-GAAP Financial Measures The Company’s results in this presentation are presented in accordance with U.S. GAAP except where otherwise noted. In certain circumstances, results have been presented that
Slide 4: What is Broadridge?
3© 2016 What is Broadridge? Unique Franchises with Ubiquitous Presence Growing and Predictable Revenues • 6% Revenue CAGR since FY2011 with 98% client revenue retention rate Strong Free Cash Flow • FY2016 CapEx:Revenue ratio of 2.6% Balanced Capital Allocation • 45% dividend payout ratio target and
Slide 5: Broadridge's Unique Franchise in Financial Services
4© 2016 Broadridge’s Unique Franchise in Financial Services 98% client revenue retention rate 50+ years of financial services experience of the top-101 global banks are our clients 10 #1 leading provider of U.S. beneficial proxy and prospectus, U.S. fixed income & Canadian equity processing Billion
Slide 6: Technology Solutions to its Core Client Segments
5© 2016 Broadridge Brings Technology Solutions to its Core Client Segments Capital Markets Wealth Management Asset Management Corporates Communications Processing Data & Analytics • 1,100 Banks & Brokers • 6,700 Institutional Investors • 140,000,000 Individual Accounts • 100,000 Financial Advisors •
Slide 7: Strong and Predictable Business Model
6© 2016 Strong and Predictable Business Model 98% client revenue retention rate Consistently high retention rate reflects the strength of our client relationships Long-term contracts Expanding portfolio of growth products Growth products contributing a growing % of revenue NACC acquisition should ac
Slide 8: Fiscal Year 2016 Total Revenues of $2.9 Billion
7© 2016 Fiscal Year 2016 Total Revenues of $2.9 Billion FY 2016 Revenues by Type Recurring Fee Revenue Growth FY2011-FY2016$0.9 29% $1.9 64% $0.2 7% Distribution Recurring Fees Event-Driven FY 2016 Revenues by Segment $2.2 75% $0.7 25% ICS GTO $ in billions FY 2011 FY 2012 FY 2013 FY 2014 FY 2015 FY
Slide 9: $24B Market Opportunity Bolstered By Key Market Trends
8© 2016 $24B Market Opportunity Bolstered By Key Market Trends Current Addressable Market Key Market Trends $16B $8B Global Technology & Operations Investor Communication Solutions Mutualization Strong drive to standardize duplicative, non-differentiating industry capabilities Digitization Digital t
Slide 10: ICS Revenue Breakdown and Growth Trends
9© 2016 $1,647 $1,776 $1,881 $2,030 $2,220 $1,500 $1,600 $1,700 $1,800 $1,900 $2,000 $2,100 $2,200 $2,300 FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 $ in millions ICS Revenue Breakdown and Growth Trends FY 2016 ICS Revenues of $2.22 billion1 Broad Client Base $864 39% $199 9% $290 13% $321 14% $193 9%
Slide 11: Customer Communications Combination Highlights
10© 2016 Customer Communications Combination Highlights Compelling financial and strategic opportunities Compelling near term financial benefits Attractive medium term expansion opportunity Larger long term digital opportunity Projected to be accretive to EPS and Adjusted EPS in FY 2017 (EPS accre
Slide 12: GTO Revenue Breakdown and Growth Trends
11© 2016 $642 $645 $681 $693 $738 $300 $400 $500 $600 $700 $800 $900 FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 $ in millions GTO Revenue Breakdown and Growth Trends By Product1 Strong Market Position Clears and settles in over 70 countries Processes avg. of over $5 trillion in equity and fixed income
Slide 13: Executing Our Capital Stewardship Strategy
12© 2016 Pr iorit y Executing Our Capital Stewardship Strategy To Enhance Shareholder Value Committed to a strong dividend Targeting tuck-in acquisitions to drive growth Share repurchases Maintain investment grade credit rating Fiscal Years 2013 - 2016: Select Uses of Cash (a) Purchases of Treasury
Slide 14: On Track to Achieve Three Year Financial Objectives
13© 2016 FY15–FY17F FY16A FY17F* Recurring Fee Revenue Growth 7-10% 9% 29-31% Total Revenue Growth 5-7% 8% 43-45% Adjusted Operating Income Margin +50-60bps/yr. 18.5% ~15% Adjusted Earnings Growth 9-11% 8% 12-17% On Track to Achieve Three Year Financial Objectives* 3-Year CAGR * As of November 9 Fir
Slide 15: Sustainable Growth, Operational Excellence, and Sound Capital Deployment
14© 2016 Sustainable Growth, Operational Excellence, and Sound Capital Deployment Drive Performance • Drive organic growth in current markets • Exploit adjacencies 7–10% Recurring Fee 3-Year CAGR (FY14–FY17F) Sustainable Growth • Realize efficiencies • Increase operational leverage Consistent Margin
Slide 16: Broadridge First Quarter Fiscal Year 2017 Highlights
Broadridge First Quarter Fiscal Year 2017 Highlights
Slide 17: First Quarter 2017 Financial Summary
16© 2016 First Quarter 2017 Financial Summary First quarter is seasonally smallest quarter of Broadridge's fiscal year Total revenue growth of 51% and recurring revenue growth of 32% o NACC acquisition biggest driver of growth o Organic recurring fee revenue growth of 3% Strong bottom line gro
Slide 18: Business Update
17© 2016 Business Update Interim record growth improved sequentially - still below recent levels NACC integration going well o On track to achieve $20 million of targeted synergies o Building blocks of digital strategy coming into place including rollout of Broadridge Communications Cloud at Mon
Slide 19: Appendix
Appendix B& Broadridge:
Slide 20: Reconciliation of Non-GAAP to GAAP Measures
19© 2016 Reconciliation of Non-GAAP to GAAP Measures $ in million, except per share figures Three Months Ended September 30, 2016 2015 Operating income (GAAP) $ 66.0 $ 59.1 Adjustments: Amortization of Acquired Intangibles and Purchased Intellectual Property 12.8 8.1 Acquisition and Integration Cost
Slide 21: Reconciliation of Non-GAAP to GAAP Measures – Fiscal Year 2017 Guidance
20© 2016 Reconciliation of Non-GAAP to GAAP Measures – Fiscal Year 2017 Guidance (Unaudited) Adjusted Earnings Per Share Growth Rate (1) Diluted earnings per share (GAAP) 9% - 14% Adjusted earnings per share (Non-GAAP) 12% - 17% Adjusted Operating Income Margin (2) Operating income margin % (GAAP) ~
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