Broadridge Financial Solutions, Inc. · NYSE:BR
Broadridge Financial Solutions — Q1 FY2009 Earnings Presentation
25 slides from Broadridge Financial Solutions's earnings presentation, Nov 6, 2008
Slide 1: Earnings Webcast & Conference Call
Exhibit 99.2 Broadridge Financial Solutions, Inc. Earnings Webcast & Conference Call First Quarter Fiscal Year 2009 November 6, 2008
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 Rich Daly, CEO First Quarter 2009 Results Dan Sheldon, CFO and Cash Flow Fiscal Year 2009 Guidance Summary Rich Daly, CEO Summary Rich Daly, CEO Q&A Rich Daly, CEO Dan Sheldon, CFO Marvin Sims, VP Investor Relations Closing Remarks Rich Daly, CEO 2
Slide 4: Opening Remarks
Opening Remarks Key Topics: • Financial results for the first quarter and reaffirmation of full fiscal year 2009 Non-GAAP earnings per share (EPS) guidance • General overview of current market conditions Putting market dynamics into context as they relate to Broadridge Discussing the resiliency of t
Slide 5: Opening Remarks – Key Topics
Opening Remarks – Key Topics First Quarter FY09 Financial Results • Revenues and earnings for the quarter are slightly better than expectations despite challenging market conditions even before considering one-time gain from purchase of senior notes • Reaffirming full fiscal year 2009 diluted Non-GA
Slide 6: Opening Remarks – Key Topics
Opening Remarks – Key Topics SPS Client Concentration: • Provide a component of securities processing to 8 of the top 10 U.S. broker-dealers as ranked by SIFMA • The top 15 SPS clients generate approximately 65% of the SPS segment’s revenues Securities Processing Segment Equity Processing Fixed-Inco
Slide 7: Opening Remarks – Key Topics
Opening Remarks – Key Topics Impact on Broadridge from Financial Industry Consolidation: • Financial firms are selecting vendor partners with strong financials and depth of product and service offerings • In the short term, we are gaining about as much revenue as we are losing • In the longer term,
Slide 8: Opening Remarks – Key Topics
Opening Remarks – Key Topics Broadridge Rated #1 for Brokerage Process Services Outsourcing • Broadridge was selected by The Brown & Wilson Group’s 2008 Black Book of Outsourcing® • Outsourcing vendors were evaluated across 26 management criteria and 18 operational excellence key performance indicat
Slide 9: Opening Remarks – Key Topics
Opening Remarks – Key Topics FY03 Down Market vs. Current Down Market: Why is today’s down market different for Broadridge? FY 2003 Down Market Current Down Market 1) Event-driven revenue declined by 30% or 1) M&A/Contest activity decline already occurred $100M, as a result of lower Mutual Fund Prox
Slide 10: Opening Remarks – Key Topics
Opening Remarks – Key Topics Sales Activity • Closed sales for quarter, including the new contract with Neuberger Berman, are in line with expectations • Full year closed sales forecast of $160M to $180M still on track Free Cash Flow and Capital Allocation • In any market cycle, Broadridge has histo
Slide 11: Broadridge Results – Q1 FY 2009
Broadridge Results – Q1 FY 2009 Key Highlights: Revenue 5% to $472M (fee only 4%) • Sales contributed 3% • Losses reduced growth by 1% • Internal Growth contributed 2% • Event-driven activity reduced growth by 1% • Distribution Fees contributed growth by 2% • Other/FX is flat Pre-tax Margin 80 bps t
Slide 12: Segment Results – Investor Communication Solutions
Segment Results – Investor Communication Solutions 1Q09 1Q08 FY09 Range ($ in millions) Actual Actual Low High Revenues $314 $299 $1,578 $1,626 Growth Rate 5% 0% 3% Fee Revenues $148 $143 $790 $822 Growth Rate 4% 3% 7% Recurring (RC) 5% 5% 8% Event-driven (ED) -1% -2% -1% Distribution Revenues $166
Slide 13: Segment Results – Securities Processing Solutions
Segment Results – Securities Processing Solutions 1Q09 1Q08 FY09 Range ($ in millions) Actual Actual Low High Revenues $133 $124 $526 $535 Growth Rate 7% 2% 4% Margin 28.1% 31.2% 25.3% 26.0% Margin Basis Points (bps) Changes 310 bps 140 bps 70 bps Q1 FY09 Key Highlights: Revenues 7% • Net New Busine
Slide 14: Segment Results – Clearing and Outsourcing Solutions
Segment Results – Clearing and Outsourcing Solutions 1Q09 1Q08 FY09 Range ($ in millions) Actual Actual Low High Revenues $23 $25 $106 $109 Growth Rate -6% 11% 14% Pre-tax Loss -$3 -$2 -$6 -$3 Q1 FY09 Key Highlights: Revenues 6% • Net New Business contributed 4% (Sales of 10% offset by losses of 6%)
Slide 15: Segment Results – Other & Foreign Exchange (FX)
Segment Results – Other & Foreign Exchange (FX) 1Q09 1Q08 FY09 Range ($ in millions) Actual Actual Low High Termination Fees Revenues $0 $2 $1 $1 Termination Fees Pre-tax Margin $0 $2 $1 $1 FX Revenues $2 $1 -$9 $0 FX Pre-tax Margin $1 $0 -$4 $0 Other Transition Expense $0 -$2 $0 $0 Interest Expense
Slide 16: Fiscal Year 2009 Grow-Over Discussion
Fiscal Year 2009 Grow-Over Discussion First quarter as well as second quarter of FY’09 tough EPS compare given grow-over items FY'08 Grow-Overs ($ in millions) Q1 Q1 Q2 Q3 Q4 FY09 Actual Forecast Q1 Act. & Q2-4 Forecast Other- Corporate/Investments Termination Fees (2) (2) (5) 0 (1) (8) Corporate Bu
Slide 17: Broadridge Cash Flow – Q1 FY 2009 and FY 2009 Forecast
Broadridge Cash Flow – Q1 FY 2009 and FY 2009 Forecast Broadridge Financial Solutions, Inc. Calculation of Free Cash Flow - Non-GAAP Unaudited (In millions) Three Months Ended FY09 Range September 2008 Low High Ridge Clearing All Other All Other Financing Processing Broadridge Processing Calculation
Slide 18: Broadridge - FY 2009 Financial Guidance Summary
Broadridge - FY 2009 Financial Guidance Summary Revenue growth of flat to 3% (1% - 5% fee only) Sales Plan for year of $160M - $180M Earnings before interest and taxes margin of 15.9% - 16.8% Diluted EPS in the range of: GAAP EPS $1.49 - $1.59 Non-GAAP EPS $1.45 - $1.55 (excludes one-time gain from
Slide 19: Summary
Summary Solid first quarter with results slightly better than expectations Reaffirming full fiscal year 2009 Non-GAAP EPS guidance despite unprecedented market conditions Broadridge business model continues to be resilient as business fundamentals remain solid We believe the recent financial service
Slide 20: Q&A
Q&A There are no slides during this portion of the presentation 19
Slide 21: Closing Comments
Closing Comments There are no slides during this portion of the presentation 20
Slide 22: Appendix
Ce ee Appendix Appendix 1 ea Broadridge’
Slide 23: Segments – FY 2009 Financial Guidance Summary
Segments – FY 2009 Financial Guidance Summary Investor Communication: Revenues Flat - 3% Margins 16.3% - 17.3% Sales Plan $100M - $110M Securities Processing: Revenues 2% - 4% Margins 25.3% - 26.0% Clearing and Outsourcing: Revenues 11% - 14% Operating losses at $3M - $6M Sales Plan $60M - $70M for
Slide 24: EPS Impact from One-time Items and Termination Fees Reconciliation
EPS Impact from One-time Items and Termination Fees Reconciliation Broadridge Financial Solutions, Inc. Reconciliation of GAAP to Non-GAAP Measures Impact of One-time Items on Earnings Per Share Reconciliation (In millions except per share amounts) (unaudited) FY09 Fiscal Year 2008 1st 1st 2nd 3rd 4
Slide 25: Use of Materials Contained Herein
Use of Materials 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 ac
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