Broadridge Financial Solutions, Inc. · NYSE:BR
Broadridge Financial Solutions — Q2 2021 Earnings Presentation
25 slides from Broadridge Financial Solutions's earnings presentation, Feb 2, 2021
Slide 1: Scaling a Global Fintech Leader – Earnings Conference Call Q2 FY2021
0© 2021 | Scaling a Global Fintech Leader E A R N I N G S C O N F E R E N C E C A L L Second Quarter Fiscal Year 2021 EXHIBIT 99.2
Slide 2: Forward-Looking Statements
1© 2021 | 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 Litigati
Slide 3: Use of Non-GAAP Financial Measures and KPIs
2© 2021 | Use of Non-GAAP Financial Measures and KPIs 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. generally accepted accounting principles ("GAAP") except where otherwise noted. In
Slide 4: Key messages
3© 2021 | Key messages Well-positioned to achieve the three-year growth objectives presented at Investor Day Executing on key strategic initiatives across Governance, Capital Markets and Wealth & Investment Management Increasing investments to support long-term growth Broadridge is on-track to deliv
Slide 5: Executing on our clear growth strategy
4© 2021 | Executing on our clear growth strategy • Continued momentum around SRD II solution • Major sale of data & analytics to leading global Asset Manager • Continued strong momentum for VSM solution • Double-digit growth in Digital Communications • Announced R.J. O’Brien selected Broadridge’s po
Slide 6: Second quarter 2021 segment recurring revenues
5© 2021 | Regulatory Customer Comms. Data-Driven Fund Solutions Issuer Note: Amounts may not sum due to rounding $137 $137 $18 $21 $82 $89 $130 $147 FY'20 FY'21 $368 $394 +7% $ in millions $119 $135 $162 $168 FY'20 FY'21 $281 $302 Capital Markets Wealth & Investment Management +8% +14% (0)% +9% +13%
Slide 7: Well-positioned for long-term growth
6© 2021 | Well-positioned for long-term growth Funding investments in technology, products and people FY21 outlook and increased investments leave Broadridge well-positioned to achieve three- year objectives and drive long-term growth Strong start to fiscal 2021 leaves Broadridge well-positioned to
Slide 8: Summary financial performance
7© 2021 | Summary financial performance $ in millions, except per share data SECOND QUARTER SUMMARY FINANCIAL RESULTS 2021 2020 Inc./(Dec.) Recurring revenues $696 $648 7% Total revenues 1,055 969 9% Operating Income 79 27 197% Adjusted Operating income (Non-GAAP) 119 94 26% Adjusted Operating incom
Slide 9: Key volume drivers: Position and Trade Volume Growth
8© 2021 | Key volume drivers: Position and Trade Volume Growth 7% 11% 7% 11% 16% 24% 1% 6% 0% 2% 6% 5% Q1'20 Q2'20 Q3'20 Q4'20 Q1'21 Q2'21 Equity MF/ETF EQUITY & MUTUAL FUND/ETF POSITION GROWTH (1)% (11)% 26% 22% 12% 24% TOTAL INTERNAL TRADE VOLUME GROWTH
Slide 10: Closed Sales remain on track with FY21 guidance
9© 2021 | Closed Sales remain on track with FY21 guidance HISTORICAL CLOSED SALES PERFORMANCE $239 FY'18 FY'19 FY'20 FY'21 CLOSED SALES TO DATE $83 $79 H1'20 H1'21 $190- $235 $ in millions Guidance
Slide 11: Recurring revenue growth increased 7% in Q2'21
10© 2021 | Recurring revenue growth increased 7% in Q2’21 RECURRING REVENUE GROWTH 6% 6% 10% FY'18 FY'19 FY'20 FY'21 3 - 6% Guidance $648 $696 Q2'20 Q2'21 +7% $ in millions
Slide 12: Second quarter 2021 revenue growth drivers
11© 2021 | $576M $1,211M $623 $648 $696 Q2'20 Recurring Revenue Closed Sales Client Losses Internal Growth Acquisitions Q2'21 Recurring Revenue Second quarter 2021 revenue growth drivers SECOND QUARTER 2021 RECURRING REVENUES GREW 7% TO $696M Note: Amounts may not sum due to rounding. +6 pts (2) pts
Slide 13: Second quarter 2021 total revenue growth drivers
12© 2021 | Second quarter 2021 total revenue growth drivers $51 $40 $31 $39 $68 $46 $45 Q4'19 Q1'20 Q2'20 Q3'20 Q4'20 Q1'21 Q2'21 EVENT-DRIVEN REVENUE $52M FY14-FY20 AVERAGE1 $ in millions Pts contribution to growth $969 $1,055 Q2'20 Total Revenue Recurring Event-Driven Distribution FX Q2'21 Total R
Slide 14: Adjusted Operating Income Margin and Operating Income Margin
13© 2021 | Adjusted Operating Income Margin and Operating Income Margin 15.9% 17.1% 17.5% FY'18 FY'19 FY'20 FY'21 9.7% 11.2% Q2'20 Q2'21 ~18% Guidance +80bps +120bps +40bps +150 bps 13.8% 15.0% 13.8% OPERATING INCOME MARGIN (GAAP) 2.8% 7.5% Adjusted Operating Income Margin (Non-GAAP)
Slide 15: Capital allocation
14© 2021 | Capital allocation $51 $0 $128 CapEx and Software M&A Client Platform Spend 3. Capital returns to shareholder per share through Annual Dividend and total share repurchase net of option proceeds $391 $578 $269 FY18 FY19 FY20 1 1. Net cash spent on new client conversions, including developm
Slide 16: FY'21 Guidance Updates / Changes
15© 2021 | FY’21 Guidance Updates / Changes Recurring revenue growth 3-6% At the higher end Total revenue growth 1-4% At the higher end Adj. Operating Income Margin (Non-GAAP) ~18% Changed from previous ~100bps expansion Adj. Earnings per Share Growth (Non-GAAP) 6-10% At the higher end Closed sales
Slide 17: Appendix
Appendix ae pa Broadridge’
Slide 18: Revenue by segment and quarter
17© 2021 | 2020 2021 % Dollars in millions Q1 Q2 Q3 Q4 FY Q1 Q2 Growth Investor Communication Solutions ("ICS") Regulatory $120 $130 $241 $300 $792 $136 $147 13% Data-driven fund solutions 79 82 89 90 339 82 89 9% Issuer 15 18 35 89 157 18 21 14% Customer communications 135 137 164 137 573 139 137 -
Slide 19: Explanation of Non-GAAP Measures and Reconciliation of GAAP to Non-GAAP Measures
18© 2021 | Explanation of Non-GAAP Measures and Reconciliation of GAAP to Non-GAAP Measures
Slide 20: Non-GAAP Measures
19© 2021 | Non-GAAP Measures Adjusted Operating Income, Adjusted Operating Income Margin, Adjusted Net Earnings, and Adjusted Earnings Per Share These Non-GAAP measures reflect Operating income, Operating income margin, Net earnings, and Diluted earnings per share, each as adjusted to exclude the im
Slide 21: Reconciliation of GAAP to Non-GAAP Measures
20© 2021 | 3 Months Ended Dec. 31 6 Months Ended Dec. 31 Dollars in millions 2020 2019 2020 2019 Operating income (GAAP) $79.5 $26.8 $158.1 $99.9 Adjustments: Amortization of Acquired Intangibles and Purchased Intellectual Property 32.6 30.3 64.9 58.4 Acquisition and Integration Costs 0.7 3.4 2.4 5.
Slide 22: Reconciliation of GAAP to Non-GAAP Measures (annual)
21© 2021 | Reconciliation of GAAP to Non-GAAP Measures Year ended June 30, Dollars in millions 2020 2019 2018 Operating income (GAAP) $624.9 $652.7 $598.1 Adjustments: Amortization of Acquired Intangibles and Purchased Intellectual Property 122.9 87.4 81.4 Acquisition and Integration Costs 12.5 6.4
Slide 23: Reconciliation of GAAP to Non-GAAP Measures (EPS)
22© 2021 | (a) Calculated using the GAAP effective tax rate, adjusted to exclude $3.6 million and $12.8 million of excess tax benefits associated with stock-based compensation for the three and six months ended December 31, 2020, and $2.2 million and $7.9 million for the three and six months ended D
Slide 24: Reconciliation of Non-GAAP to GAAP Measures – Fiscal Year 2021 Guidance
23© 2021 | FISCAL YEAR 2021 Adjusted Earnings Per Share Growth and Adjusted Operating Income Margin FY21 Adjusted Earnings Per Share Growth Rate (a) Diluted earnings per share - GAAP 5 - 12% growth Adjusted earnings per share - Non-GAAP 6 - 10% growth FY21 Adjusted Operating Income Margin (b) Operat
Slide 25: Broadridge Investor Relations Contacts
24© 2021 | Elsa Ballard Tel: 212-973-6197 Email: Elsa.Ballard@Broadridge.com W. Edings Thibault Tel: 516-472-5129 Email: Edings.Thibault@Broadridge.com Broadridge Investor Relations Contacts
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