Broadridge Financial Solutions, Inc. · NYSE:BR
Broadridge Financial Solutions — Q2 2022 Earnings Presentation
27 slides from Broadridge Financial Solutions's earnings presentation, Feb 1, 2022
Slide 1: Scaling a Global Fintech Leader: Second Quarter Fiscal Year 2022
0© 2022 | 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 2022 EXHIBIT 99.2
Slide 2: Forward-Looking Statements
1© 2022 | 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, KPIs and foreign exchange rates
2© 2022 | Use of Non-GAAP financial measures, KPIs and foreign exchange rates Use of Non-GAAP Financial Measures This presentation includes certain Non-GAAP financial measures including Adjusted Operating income, Adjusted Operating income margin, Adjusted Net earnings, Adjusted earnings per share (“
Slide 4: Key messages
3© 2022 | Key messages Recurring revenue grew 19%, propelled by revenue from Closed sales, robust governance trends, and the continued successful integration of Itiviti Growth reflects disciplined execution against our multi-year plan across Governance, Capital Markets, and Wealth & Investment Manag
Slide 5: Broadridge is executing across Governance, Capital Markets, and Wealth & Investment Management
4© 2022 | Broadridge is executing across Governance, Capital Markets, and Wealth & Investment Management Extend Governance Grow Capital Markets Build Wealth & Investment Mgmt. $427M +10% YoY $224M +41% YoY $146M +15% YoY Q2’22 Highlights • Continued strong position growth across both funds and equit
Slide 6: Broadridge continues to deliver strong and sustainable results
5© 2022 | Broadridge continues to deliver strong and sustainable results Broadridge remains on track to drive another year of strong recurring revenue growth, powered by new sales, underlying volume growth, and targeted M&A, while investing for the long-term and delivering 11-15% Adjusted EPS growth
Slide 7: Financial Overview
Financial Overview 7, CASE ee Lio Broadridge:
Slide 8: Summary financial results
7© 2022 | Summary financial results $ in millions, except per share data SECOND QUARTER SUMMARY FINANCIAL RESULTS 2022 2021 Inc./(Dec.) Recurring revenues $798 $673 19% Total revenues 1,260 1,055 19% Operating income 69 79 (13%) Adjusted Operating income (Non-GAAP) 141 119 19% Adjusted Operating inc
Slide 9: Recurring revenue increased 19% in second quarter 2022
8© 2022 | FY'19 FY'20 FY'21 FY'22 Recurring revenue increased 19% in second quarter 2022 $673 $798 Q2'21 Q2'22 RECURRING REVENUE GROWTH 10%10% $ in millions Guidance High end of 12 - 15% 6% +19%
Slide 10: Second quarter 2022 segment recurring revenues
9© 2022 | $127 $146 $158 $224 Q2'21 Q2'22 $136 $148 $21 $24 $86 $145 $166 Q2'21 Q2'22 Regulatory Customer Comms. Data-Driven Fund Solutions Issuer $ in millions + 14% + 9% + 3% +15% ICS RECURRING REVENUES GTO RECURRING REVENUES Second quarter 2022 segment Recurring revenues $427 $387 Capital Markets
Slide 11: Key volume drivers: position and trade volume growth
10© 2022 | INTERNAL TRADE GROWTH (ITG) 24% 20% 33% 39% 20% 5% 7% 11% 9% 12% Q2'21 Q3'21 Q4'21 Q1'22 Q2'22 Equity MF/ETF EQUITY & MUTUAL FUND/ETF POSITION GROWTH Key volume drivers: position and trade volume growth 24% 12% (1)% 2% 1% FY’20 FY’21 26% 10% 10% 2% ITG 12%9% 1. Q2’21 positions represented
Slide 12: Second quarter 2022 Recurring revenue growth drivers
11© 2022 | Second quarter 2022 Recurring revenue growth drivers SECOND QUARTER 2022 RECURRING REVENUES GREW 19% TO $798M ICS $387M 8 pts (2) pts 4 pts 0 pts $427M GTO $285M 6 pts (2) pts 4 pts 22 pts $371M $ in millions Pts contribution to growth $673 $798 Q2'21 Recurring Revenue Closed Sales Client
Slide 13: Second quarter 2022 Total revenue growth drivers
12© 2022 | $45 $73 $72 $76 $65 Q2'21 Q3'21 Q4'21 Q1'22 Q2'22 $1,055 $1,260 Q2'21 Total Revenue Recurring Event-Driven Distribution FX Q2'22 Total Revenue Second quarter 2022 Total revenue growth drivers QUARTERLY EVENT-DRIVEN REVENUE +12 pts +2 pts +5 pts 0 pts 19% SECOND QUARTER 2022 TOTAL REVENUE
Slide 14: Operating income margin and Adjusted Operating income margin
13© 2022 | 17.1% 17.5% 18.1% FY'19 FY'20 FY'21 FY'22 15.0% 13.8% 13.6% 5.5%7.5% 11.2% 11.2% Q2'21 Q2'22 +120 bps +40 bps +60 bps OPERATING INCOME MARGIN (GAAP) ADJUSTED OPERATING INCOME MARGIN (NON- GAAP) ~18.5% Guidance Operating income margin and Adjusted Operating income margin OPERATING INCOME M
Slide 15: Closed sales remain on track with fiscal year 2022 guidance
14© 2022 | FY'20 FY'21 FY'22 $76 $113 YTD'21 YTD'22 $228 $232 Guidance Closed sales remain on track with fiscal year 2022 guidance $ in millions $240 – $280M CLOSED SALES
Slide 16: Capital allocation
15© 2022 | YTD'21 YTD'22 $1.94 $2.16 $2.30 33% 11% 6% DIVIDENDS PER SHARE M&A Client Platform Investments CapEx and Software Capital allocation 2 1. Includes Software purchases and capitalized internal use software. 2. Net investments on new client conversions, including development of platform capa
Slide 17: Fiscal Year 2022 Guidance
16© 2022 | Fiscal Year 2022 Guidance FY’22 Guidance Updates / Changes Recurring revenue growth 12-15% High end Adjusted Operating income margin (Non-GAAP) ~19% ~18.5% Adjusted earnings per share growth (Non-GAAP) 11-15% No change Closed sales $240-$280M No change
Slide 18: Appendix
Appendix oe es Broadridge:
Slide 19: Supplemental Reporting Detail - Product Line Reporting
18© 2022 | Confidential and Proprietary | Supplemental Reporting Detail ‒ Product Line Reporting (Unaudited) In the second quarter of fiscal year 2021, the Company changed its presentation of product line revenue reporting. Beginning with the first quarter of fiscal year 2022, the Company also revis
Slide 20: Explanation of Non-GAAP measures and Reconciliation of GAAP to Non-GAAP measures
19© 2022 | Explanation of Non-GAAP measures and Reconciliation of GAAP to Non-GAAP measures
Slide 21: Non-GAAP measures Explanation and Reconciliation
20© 2022 | Non-GAAP 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. generally accepted accounting principles ("GAAP") except where otherwise noted. In certain circumstances, r
Slide 22: Non-GAAP measures
21© 2022 | Non-GAAP measures Adjusted EBITDA reflects Net earnings before interest, taxes, other non-operating (income)/expenses net, depreciation, amortization, Acquisition and Integration Costs, Real Estate Realignment and Covid-19 Related Expenses and Software Charge. We exclude Acquisition and I
Slide 23: Reconciliation of GAAP to Non-GAAP Measures
22© 2022 | Confidential and Proprietary | Reconciliation of GAAP to Non-GAAP Measures (Unaudited) (a) Calculated using the GAAP effective tax rate, adjusted to exclude $7.1 million and $11.5 million of excess tax benefits associated with stock-based compensation for the three and six months ended De
Slide 24: Reconciliation of GAAP to Non-GAAP Measures
23© 2022 | Confidential and Proprietary | Reconciliation of GAAP to Non-GAAP Measures (Unaudited) (a) Calculated using the GAAP effective tax rate, adjusted to exclude $7.1 million and $11.5 million of excess tax benefits associated with stock-based compensation for the three and six months ended De
Slide 25: Reconciliation of GAAP to Non-GAAP Measures (Unaudited)
24© 2022 | Confidential and Proprietary | Reconciliation of GAAP to Non-GAAP Measures (Unaudited) Year ended June 30, Dollars in millions 2021 2020 2019 Operating income (GAAP) $678.7 $624.9 $652.7 Adjustments: Amortization of Acquired Intangibles and Purchased Intellectual Property 153.7 122.9 87.4
Slide 26: Fiscal Year 2022 Adjusted Earnings Per Share Growth Rate
25© 2022 | Confidential and Proprietary | Fiscal Year, 2022 Adjusted Earnings Per Share Growth Rate (a) Diluted earnings per share – GAAP (5) – 0% growth Adjusted earnings per share – Non-GAAP 11-15% growth Adjusted Operating Income Margin (b) Operating income margin % - GAAP ~13.5% Adjusted Operati
Slide 27: Contacts
26© 2022 | Contacts W. Edings Thibault Edings.Thibault@Broadridge.com Sean Silva Sean.Silva@Broadridge.com Replay Options Online replay available at broadridge-ir.com Telephone replay available through February 8, 2022 Domestic Dial-In: 1-877-344-7529 Access Code: 2652304 International Toll Dial-In:
Broadridge Financial Solutions — Q2 2022 Earnings Presentation on 6ix