Broadridge Financial Solutions, Inc. · NYSE:BR
Broadridge Financial Solutions — Q2 2010 Earnings Presentation
25 slides from Broadridge Financial Solutions's earnings presentation, Feb 4, 2010
Slide 1: Earnings Webcast & Conference Call, Second Quarter Fiscal Year 2010
Exhibit 99.2 Broadridge Financial Solutions, Inc. Earnings Webcast & Conference Call Second Quarter Fiscal Year 2010 © 2010 Broadridge Financial Solutions, Inc. Broadridge and the Broadridge logo are registered trademarks of Broadridge Financial Solutions, Inc. February 4, 2010
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 Key Topics Rich Daly, CEO Second Quarter 2010 Results and Dan Sheldon, CFO Full Year Guidance Summary Summary and Closing Comments 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 second quarter of fiscal year 2010 • A review of closed sales performance • Strategy Update 3
Slide 5: Opening Remarks – Key Topics: Second Quarter Fiscal Year 2010 Financial Results
Opening Remarks – Key Topics Second Quarter Fiscal Year 2010 Financial Results: Strong financial performance in the second quarter was better than expected • Driven by an unprecedented level of event-driven mutual fund proxy activity that pulled in revenue from the second half of the year • Event-dr
Slide 6: Opening Remarks – Key Topics: Sales Performance Overview
Opening Remarks – Key Topics Sales Performance Overview: Closed sales for the quarter of $58M increased 30% compared to the same period last year • Year-to-date closed sales of $88M increased 36% Strong recurring revenue sales include the previously announced $35M MSSB transaction • Recurring revenu
Slide 7: Strategy Update: Investor Communications Strategy
Strategy Update Investor Communications Strategy: Expand our leadership role in driving e-solutions • We have driven electronic participation in our traditional proxy business from 0% to >50% in recent years • Our transaction reporting business is approximately 10% electronic and growing • We want t
Slide 8: ICS Unique Business Systems Processing Model
ICS Unique Business Systems Processing Model Proxy and Interim processing system is the “plumbing” supporting the voting process for corporate governance (1) Represents Broadridge’s estimated total number of brokerage firms and banks in the U.S. and international markets (2) Represents Broadridge’s
Slide 9: Strategy Update: Investor Communications Strategy
Strategy Update Investor Communications Strategy: Expand our leadership role in driving e-solutions • We have driven electronic participation in our traditional proxy business from 0% to >50% in recent years • Our transaction reporting business is approximately 10% electronic and growing • We want t
Slide 10: Strategy Update: Securities Processing & Outsourcing Strategy
Strategy Update Securities Processing & Outsourcing Strategy: Expand our leadership position in securities processing and outsourcing • Leverage our #1 market position in securities processing and outsourcing • Leverage our #1 ranking by independent service rater – Brown-Wilson Group’s, “The Black B
Slide 11: Broadridge Results From Continuing Operations – Q2 & YTD FY 2010
Broadridge Results From Continuing Operations – Q2 & YTD FY 2010 Key Highlights: Q2 - Revenue 21% to $530M and YTD 8% to $968M • Primarily related to event-driven mutual fund proxy activities • Recurring revenues from sales contributed mid-single digits and are expected to contribute mid- single dig
Slide 12: Segment Results – Investor Communication Solutions
Segment Results – Investor Communication Solutions 2Q10 2Q09 2Q10 YTD 2Q09 YTD FY10 Range ($ in millions) Actual Actual Actual Actual Low High Revenues $393 $296 $703 $609 $1,698 $1,737 Growth Rate 33% -3% 15% 1% 11% 13% Fee Revenues $209 $144 $366 $292 $898 $923 Growth Rate 46% -2% 26% 1% 16% 19% R
Slide 13: Business Results – Securities Processing Solutions
Business Results – Securities Processing Solutions 2Q10 2Q09 2Q10 YTD 2Q09 YTD FY10 Range ($ in millions) Actual Actual Actual Actual Low High Revenues $128 $140 $252 $273 $502 $511 Growth Rate -9% 9% -8% 8% -6% -4% Trade $72 $84 $143 $164 $285 $292 Growth Rate -14% 6% -12% 7% -8% -6% Non-trade $56
Slide 14: Business Results – Outsourcing Solutions (Continuing Operations)
Business Results – Outsourcing Solutions (Continuing Operations) 2Q10 2Q09 2Q10 YTD 2Q09 YTD FY10 Range 4Q10 ($ in millions) Actuals Actuals Actuals Actuals Low High "Run-rate" Revenues $6 $7 $12 $13 $34 $38 $16 Growth Rate -11% 59% -8% 37% 37% 50% Pre-tax Loss -$2 -$2 -$5 -$4 -$14 -$16 -$5 Key High
Slide 15: Continuing & Discontinued Operations: Evolution of the Penson Deal
Continuing & Discontinued Operations "Evolution of the Penson Deal" FY'09 Actual results to Continuing Operations GAAP FY'09 GAAP Continuing Operations to Fully Converted Penson Phases 1 & 2 (1) (2) (3) (4) (5) (6) (7) Pre-Penson Transaction - Discontinued Operations = Continuing Operations + Penson
Slide 16: Segment Results – Securities Processing Solutions with Outsourcing
Segment Results – Securities Processing Solutions with Outsourcing 2Q10 2Q09 2Q10 YTD 2Q09 YTD FY10 Range ($ in millions) Actual Actual Actual Actual Low High Revenues $134 $147 $264 $286 $536 $549 Growth Rate -9% 11% -8% 9% -4% -2% Trade $72 $84 $143 $164 $285 $292 Growth Rate -14% 6% -12% 7% -8% -
Slide 17: Segment Results – Other & Foreign Exchange (FX)
Segment Results – Other & Foreign Exchange (FX) 2Q10 2Q09 2Q10 YTD 2Q 09 YTD FY10 Range ($ in millions) Actual Actual Actual Actual Low High Other Fees Revenues $2 - $2 - $2 $2 Other Fees Margin $2 - $2 - $2 $2 FX Revenues $1 -$5 -$1 -$3 -$25 -$20 FX P&L Margin $1 -$1 $1 - -$10 -$7 Other Interest Ex
Slide 18: Free Cash Flow (Non-GAAP) – YTD and FY10 Forecast
Free Cash Flow (Non-GAAP) – YTD and FY10 Forecast (In millions) Six Months Ended FY10 Range (a) December 2009 Low High Free Cash Flow (Non-GAAP) : Net earnings from continuing operations (GAAP) $ 78 $ 216 $ 230 Depreciation and amortization (includes other LT assets) 28 60 62 Stock-based compensatio
Slide 19: FY 2010 Continuing Operations Financial Guidance Summary
Broadridge - FY 2010 Continuing Operations Financial Guidance Summary Revenue growth in a range of 7-9% Closed sales forecast for the year of $185-205M Earnings before interest and taxes margin of 15.4-16.0% (non-GAAP) Diluted Earnings Per Share: GAAP EPS (continuing operations) in the range of $1.5
Slide 20: Summary
Summary Year-to-date FY10 is going very well. Second quarter revenues, earnings and sales were very strong and are tracking to our full year expectations Event-driven mutual fund proxy activity was up significantly and represented the majority of the second quarter improvement Both of the segments h
Slide 21: Q&A
Q&A There are no slides during this portion of the presentation 20
Slide 22: Closing Comments
Closing Comments There are no slides during this portion of the presentation 21
Slide 23: Appendix
Ce ee Appendix Appendix 22 Ba Broadridge
Slide 24: Broadridge FY10 Guidance from Continuing Operations
Broadridge FY10 Guidance from Continuing Operations Revenue ($ in millions) EBIT FY09 FY10 Range FY09 FY10 Range Actual Low High Actual Low High $1,531 $1,698 $1,737 ICS $249 $287 $309 -3% 11% 13% Growth % / Margin % 16.3% 16.9% 17.8% $559 $536 $549 SPS $134 $89 $98 5% -4% -2% Growth % / Margin % 23
Slide 25: Broadridge Q2 & YTD Results and FY10 Guidance
Broadridge Q2 & YTD Results and FY10 Guidance 2Q10 2Q09 2Q10 YTD 2Q09 YTD FY10 Range DRIVERS Actual Actual Actual Actual Low High Sales 4% 3% 3% 3% 4% 5% Losses -2% -1% -2% -1% -2% -2% Net New Business 2% 2% 1% 2% 2% 3% Internal Growth -4% 2% -3% 3% -2% -1% Event-Driven 14% -2% 7% -1% 4% 4% Distribu
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