Broadridge Financial Solutions, Inc. · NYSE:BR

Broadridge Financial Solutions — Investor Presentation (September 2022)

37 slides from Broadridge Financial Solutions's investor presentation, Sep 14, 2022

  1. Slide 1: Scaling a Global Fintech Leader: First Quarter Fiscal Year 2023 Investor Presentation

    0© 2022 | Scaling a Global Fintech Leader First Quarter Fiscal Year 2023 Investor Presentation EXHIBIT 99.1

  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") contains “forward-looking statements” within the meaning of the Private Securities Litigation

  3. 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 (“

  4. Slide 4: A clear path for long term growth

    3© 2022 | A clear path for long term growth A global Fintech leader addressing a large and growing market Three franchise businesses executing on clear growth strategies grounded in long term trends Long track record delivering consistent growth and strong total shareholder returns 2014 Invest for G

  5. Slide 5: Broadridge is a global Fintech leader

    4© 2022 | Broadridge is a global Fintech leader Managing proxy voting for 750 million equity shareholder positions Powering $9T per day in fixed income and equity trades Distributing more than 7B critical communications each year 750 MILLION $9 TRILLION 7 BILLION Broadridge powers the critical infra

  6. Slide 6: We have a strong track record of delivering growth and value

    5© 2022 | $2,612 $2,760 $2,946 $3,228 $3,749 $4.19 $4.66 $5.03 $5.66 $6.46 2 2.5 3 3.5 4 4.5 5 5.5 6 6.5 7 1000 1500 2000 2500 3000 3500 4000 FY'18 FY'19 FY'20 FY'21 FY'22 Recurring revenue Adjusted EPS We have a strong track record of delivering growth and value $M except for per share measures 10%

  7. Slide 7: Broadridge has a $60 billion and growing market opportunity

    6© 2022 | Technology and operations spend by global banks is over $190 Billion Broadridge has a $60 billion and growing market opportunity $60B CURRENT OPPORTUNITY $22B GOVERNANCE $23B CAPITAL MARKETS $16B WEALTH

  8. Slide 8: Three strong growing franchises with $3.7 billion in Recurring revenue

    7© 2022 | Capital Markets $921M Recurring Revenue 14% Average Annual Growth Wealth & Investment Management $554M Recurring Revenue 11% Average Annual Growth Governance $2.3B Recurring Revenue 8% Average Annual Growth $3.7B FY’22 RECURRING REVENUE Three strong growing franchises with $3.7 billion in

  9. Slide 9: Track record of delivering consistent growth and strong TSR

    8© 2022 | Track record of delivering consistent growth and strong TSR FY’14 – FY’17 (CAGR) FY’17 – FY’20 (CAGR) Three-year Growth Objectives (CAGR) FY’20 – FY’23 Organic Recurring revenue growth1 5% 5% 5-7% Recurring revenue growth 7%2 7% 7-9% Adj. Operating Income Margin expansion (bps/ year) (Non-

  10. Slide 10: Investor Communication Solutions Segment Overview

    9© 2022 | Investor Communication Solutions SEGMENT OVERVIEW

  11. Slide 11: ICS Strategy

    10© 2022 | ICS Strategy Extend our strong and growing Governance franchise Grow End-to-End Issuer Solutions Build Data-Driven Fund Solutions Drive Next-Gen Regulatory Transform Omni-Channel Communications A leader at the heart of a powerful governance network Recurring revenues of $2.3B and five-yea

  12. Slide 12: Our network links investors, asset managers, and issuers across North America

    11© 2022 | Our network links investors, asset managers, and issuers across North America 170M+ Retail shareholder accounts 120,000+ Institutional shareholders 30,000+ Mutual funds and ETFs ISSUERS OF SECURITIES SHAREHOLDERS 200,000+ Financial advisors 9,000+ Corporate issuers REGULATORY BODIES & TRA

  13. Slide 13: Key volume drivers: position and trade volume growth

    12© 2022 | 1% 2% 8% 7% 3% 8% 11% 6% 10% 26% 18% 9% 11% 11% 8% 4% 4% 10% 9% 2% 10% 14% FY'12 FY'13 FY'14 FY'15 FY'16 FY'17 FY'18 FY'19 FY'20 FY'21 FY'22 Equity MF/ETF ITG EQUITY & MUTUAL FUND/ETF POSITION GROWTH Key volume drivers: position and trade volume growth 1% (4)% 8% 3% 2% 3% 13% 6% 9% 12% 1%

  14. Slide 14: The importance of corporate governance continues to grow

    13© 2022 | The importance of corporate governance continues to grow Technology is driving increased participation and diversification for retail investors New technologies are lowering the cost of investing and bringing in new investors. ✓ ETFs ✓ Managed Accounts ✓ Zero commission trading ✓ Enhanced

  15. Slide 15: ICS Segment Overview

    14© 2022 | ICS Segment Overview FY'18 FY'19 FY'20 FY'21 FY'22 11% 8% ICS FISCAL YEAR RECURRING REVENUES $570 $616 $189 $216 $344 $366 $940 $1,077 FY'21 FY'22 $2,042 $2,275 YoY Growth +15% +6% +14% 8% Regulatory Customer Communications Data-Driven Fund Solutions Issuer Avg. Annual Growth 4% 7% 6% $2.

  16. Slide 16: Global Technology and Operations Segment Overview

    15© 2022 | Global Technology and Operations SEGMENT OVERVIEW

  17. Slide 17: GTO Fiscal Year Recurring Revenues

    16© 2022 | $701M $558M GTO FISCAL YEAR RECURRING REVENUES $525 $554 $661 $921 FY'21 FY'22 $1,186 $1,474 +39% +5% YoY Growth FY'18 FY'19 FY'20 FY'21 FY'22 Wealth & Investment Management Capital Markets 18% 4%10% 24%13% Avg. Annual Growth $1.5B GTO Strategy: Grow Capital Markets franchise and continue

  18. Slide 18: Capital Markets Overview

    17© 2022 | Capital Markets Overview 1. In equity and fixed income trades processed on average per day • A global leader in post-trade processing for cash securities • Continued growth driven by evolution of global banks • Launching AI-powered fixed income trading platform • Itiviti adds strength, sc

  19. Slide 19: Simplification, mutualization, front-to-back digitization and trading innovation

    18© 2022 | Simplification Clients are looking to simplify their technology stack and operating models and reduce solution fragmentation Mutualization Market pressures are accelerating front office mutualization Front-to-back digitization Firms are looking to drive deeper integration and automation a

  20. Slide 20: Wealth & Investment Management Overview

    19© 2022 | • Leading provider of back-office capabilities • Strong set of differentiated component solutions for front- and middle-office • Launching the industry’s only unified front-to-back technology platform • Growing Integrated Investment Management Suite Wealth & Investment Management Overview

  21. Slide 21: Broadridge Business Model

    20© 2022 | Broadridge Business Model

  22. Slide 22: The Broadridge financial model is focused on driving steady revenue growth

    21© 2022 | The Broadridge financial model is focused on driving steady revenue growth and consistent earnings per share growth, generated by: Continued margin expansion from our scale and operational efficiencies Balanced capital allocation leveraging our strong free cash flow businesses Investments

  23. Slide 23: We are maintaining closed sales momentum

    22© 2022 | FY'20 FY'21 FY'22 $228 $232 We are maintaining closed sales momentum… $ in millions CLOSED SALES FY'21 FY'22 FY’22 SALES BACKLOG $385 $440 12% 12% % OF RECURRING REVENUE $282

  24. Slide 24: ...while continuing to expand margin

    23© 2022 | 13.8% 15.0% 13.8% 13.6% 13.3% …while continuing to expand margin Note: Information about our use of Non-GAAP measures and a reconciliation to closest GAAP measures may be found on slides 29 - 35 15.9% 17.1% 17.5% FY'18 FY'19 FY'20 FY'21 FY'22 +120 bps +40 bps +60 bps Efficiency Contributi

  25. Slide 25: Total capital returns and capital allocation

    24© 2022 | TOTAL CAPITAL RETURNS $1.94 $2.16 $2.30 $2.56 $2.90 33% 11% 6% 11% 13% 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

  26. Slide 26: Fiscal Year 2023 Guidance

    25© 2022 | Fiscal Year 2023 Guidance as of August 12, 2022 FY’23 Guidance Recurring revenue growth 6 - 9% Adjusted Operating income margin (Non-GAAP) Increase of ~ 50 bps Adjusted earnings per share growth (Non-GAAP) 7 - 11% Closed sales $270M - $310M

  27. Slide 27: Key messages (as of August 12, 2022 earnings call)

    26© 2022 | Key messages (as of August 12, 2022 earnings call) Broadridge delivered very strong fourth quarter results, including 15% recurring revenue growth (12% organic) and 21% Adjusted EPS growth 1 2 3 4 Broadridge’s growth is being powered by strong execution on key growth initiatives, the perf

  28. Slide 28: Summary financial performance

    27© 2022 | Summary financial performance Q4’22 Inc./(Dec.) FY’22 Inc./(Dec.) Recurring revenues $1,189 15% $3,749 16% Total revenues 1,723 12% 5,709 14% Operating income 342 21% 760 12% Adjusted Operating income (Non-GAAP) 436 25% 1,066 18% Adjusted Operating income margin (Non-GAAP) 25.3% 250 bps 1

  29. Slide 29: Explanation of Non-GAAP measures and Reconciliation of GAAP to Non-GAAP measures

    28© 2022 | Explanation of Non-GAAP measures and Reconciliation of GAAP to Non-GAAP measures

  30. Slide 30: Non-GAAP measures: Explanation and Reconciliation

    29© 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

  31. Slide 31: Non-GAAP measures

    30© 2022 | Non-GAAP measures We exclude Acquisition and Integration Costs, IBM Private Cloud Charges, Real Estate Realignment and Covid-19 Related Expenses, the Russia-Related Exit Costs, Investment Gains, the Software Charge, the Gain on Acquisition-Related Financial Instrument and the Gain on Sale

  32. Slide 32: Reconciliation of GAAP to Non-GAAP Measures

    31© 2022 | 1Confidential and Proprietary | Reconciliation of GAAP to Non-GAAP Measures Note: Amounts may not sum due to rounding. Year ended June 30, Dollars in millions 2022 2021 2020 2019 2018 2017 2016 2015 2014 Operating Income (GAAP) $759.9 $678.7 $624.9 $652.7 $598.1 $534.0 $502.3 $468.5 $418.

  33. Slide 33: Reconciliation of GAAP to Non-GAAP Measures (Unaudited)

    32© 2022 | 1Confidential and Proprietary | Reconciliation of GAAP to Non-GAAP Measures (Unaudited) Year ended June 30, Dollars in millions, except per share amounts 2022 2021 2020 2019 2018 2017 2016 2015 2014 Diluted earnings per share (GAAP) $4.55 $4.65 $3.95 $4.06 $3.56 $2.70 $2.53 $2.32 $2.12 Ad

  34. Slide 34: Reconciliation of GAAP to Non-GAAP Measures (Unaudited)

    33© 2022 | 1Confidential and Proprietary | Reconciliation of GAAP to Non-GAAP Measures (Unaudited) 3 Months Ended June 30 Fiscal Year Ended June 30 Dollars in millions 2022 2021 2022 2021 2020 Operating income (GAAP) $341.7 $281.4 $759.9 $678.7 $624.9 Adjustments: Amortization of Acq. Intangibles an

  35. Slide 35: Reconciliation of GAAP to Non-GAAP Measures (Unaudited)

    34© 2022 | 1Confidential and Proprietary | Reconciliation of GAAP to Non-GAAP Measures (Unaudited) (a) Real Estate Realignment Expenses were $22.6 million and ($3.3 million) for the three months ended June 30, 2022 and 2021, respectively, and $23.0 million, $29.6 million, and $0.0 million for the fi

  36. Slide 36: Fiscal Year 2023 Adjusted Earnings Per Share Growth Rate

    35© 2022 | 1Confidential and Proprietary | Fiscal Year, 2023 Adjusted Earnings Per Share Growth Rate (a) Diluted earnings per share – GAAP ~13-17% growth Adjusted earnings per share – Non-GAAP 7-11% growth Adjusted Operating Income Margin (b) Operating income margin % - GAAP Increase of ~150 bps Adj

  37. Slide 37: Broadridge Investor Relations Contacts

    36© 2022 | W. Edings Thibault Sean Silva broadridgeir@broadridge.com Broadridge Investor Relations Contacts

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