Broadridge Financial Solutions, Inc. · NYSE:BR
Broadridge Financial Solutions — Q3 2014 Earnings Presentation
23 slides from Broadridge Financial Solutions's earnings presentation, May 9, 2014
Slide 1: Earnings Webcast & Conference Call Third Quarter 2014
Exhibit 99.2 Earnings Webcast & Conference Call Third Quarter 2014 © 2014 Broadridge Financial Solutions, Inc. Broadridge and the Broadridge logo are registered trademarks of Broadridge Financial Solutions, Inc. May 9, 2014
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, President and CEO Third Quarter and YTD 2014 Michael Liberatore, Highlights and Segment Results Acting Principal Financial Officer Summary Rich Daly, President and CEO Q&A Rich Daly, President and CEO Michael Liberatore, Acting Principal Financial Officer Cl
Slide 4: Key Messages
Key Messages Record results combined with strategic momentum Strong results led by Net New Business (recurring revenue closed sales less client losses) Market conditions remain favorable Executing on our growth strategy including investing in our future growth Reaffirming FY14 guidance; anticipating
Slide 5: Financial Highlights
Financial Highlights Strong Revenue Growth Q3 recurring revenues were up 9% (YTD up 9%) and total revenues were up 5% (YTD up 7%) Primarily due to Net New Business and internal growth Record Q3 and YTD EPS Q3 Non-GAAP diluted Earnings Per Share (EPS) of $0.44 was up 13% (YTD $1.08 up 46%) Q3 GAAP di
Slide 6: Closed Sales Performance
Closed Sales Performance YTD recurring revenue closed sales up 5% Recurring revenue closed sales were $62M compared to $58M in the prior year (Q3 sales were flat year over year ~$24M) No large transactions of $5M or greater Sales pipeline remains robust and is growing Building momentum across both s
Slide 7: Key Financial Drivers
Key Financial Drivers 3Q 3Q YTD Actual FY14 FY14 FY14 FY13 Range Growth Drivers as a % of Recurring Revenue Closed Sales (Recurring) 7% 7% 6% 7% Client Losses (3%) (3%) (1%) (3%) Net New Business 4% 4% 5% 4% (a) Internal Growth 4% 4% (1%) 2-3% Organic Growth 8% 8% 4% 6-7% Acquisitions 1% 1% 0% 1% To
Slide 8: Segment Results & Forecast – Investor Communication Solutions
Segment Results & Forecast – Investor Communication Solutions Recurring/Growth (Non-GAAP) Revenue/Growth EBIT/Growth (Non-GAAP) Margin/Growth (Non-GAAP) Q3: $209M /13% $430M / 6% $56M / 9% 12.9% / 30 bps YTD: $555M / 12% $1,152M / 8% $117M / 24% 10.2% / 140 bps FY14: $923 to $931M / 8 to 9% $1,832 t
Slide 9: Segment Results & Forecast – Securities Processing Solutions
Segment Results & Forecast – Securities Processing Solutions Revenue/Growth EBIT/Growth (Non-GAAP) Margin/Growth (Non-GAAP) Q3: $178M / 5% $38M / 32% 21.2% / 430 bps Q3 YTD: $521M / 7% $104M / 79% 20.0% / 810 bps FY14: $687 to 695M / 4 to 5% $117 to 125M / 38 to 47% 17.0% to 18.0% / 410 to 510 bps R
Slide 10: Closing Summary
Closing Summary Record YTD revenue and EPS results. FY14 revenue and EPS expected to be in the upper half of the guidance ranges Confidence in our business is higher than it has ever been Building momentum from sales pipeline growth, E&A product solutions, and favorable market-based activities Conti
Slide 11: Q&A
Q&A There are no slides during this portion of the presentation 10
Slide 12: Closing Comments
Closing Comments There are no slides during this portion of the presentation 11
Slide 13: Appendix
12 Appendix Bg Broadridge
Slide 14: Segment Results & Forecast – Other & Foreign Exchange (FX)
Segment Results & Forecast – Other & Foreign Exchange (FX) YTD FY14 Range 3Q14 3Q14 Low High Corporate Expenses $(14)M $(28)M $(51)M $(49)M Interest Expense, net $(6)M $(18)M $(25)M $(25)M FX - P&L - Revenue $(2)M $(1)M $10M $10M - EBIT $4M $13M $16M $16M - Transaction Activity $0M $1M $1M $1M Corpo
Slide 15: Broadridge Q3 and YTD FY14
Broadridge Q3 and YTD FY14 Revenue Earnings FY13 FY14 FY13 FY14 FY13 FY14 FY13 FY14 Q3 Q3 Q3 YTD Q3 YTD Q3 Q3 Q3 YTD Q3 YTD $404 $430 $1,071 $1,152 $51 $56 $95 $117 8% 6% 7% 8% 12.6% 12.9% 8.8% 10.2% ICS $170 $178 $487 $521 $29 $38 $58 $104 0% 5% 0% 7% Growth % / Margin % 16.9% 21.2% 11.9% 20.0% $57
Slide 16: Broadridge FY14 Guidance
Broadridge FY14 Guidance Revenue Earnings FY13 FY14 Range FY13 FY14 Range Actual Low High ($ in millions) Actual Low High $1,760 $1,832 $1,848 ICS $302 $335 $344 8% 4% 5% Growth % / Margin % 17.2% 18.3% 18.6% $661 $687 $695 SPS $85 $117 $125 1% 4% 5% Growth % / Margin % 12.9% 17.0% 18.0% $2,421 $2,5
Slide 17: Cash Flow – YTD FY14 Results and FY14 Forecast
Cash Flow –YTD FY14 Results and FY14 Forecast Free Cash Flow - Non-GAAP Unaudited ($ millions) Nine Months Ending FY14 Range(a) Round March 2014 Low High Free Cash Flow (Non-GAAP) : Round Net earnings from operations (GAAP) $ 122.8 $ 123 $ 252 $ 265 Depreciation and amortization (includes other LT a
Slide 18: Recurring Revenue Closed Sales to Revenue Contribution
Recurring Revenue Closed Sales to Revenue Contribution (a) (b) ($ in millions) Closed Sales Revenue Contribution Backlog Forecast Forecast Forecast FY14 FY14 FY14 ICS (less than $5M deals) $60-70 ~$45-55 ~$60-70 ~Contribution to recurring revenue growth ~6% SPS (less than $5M deals) $30-40 ~$50-55 ~
Slide 19: Revenues and Closed Sales FY08-FY13
Revenues and Closed Sales FY08-FY13 ($ in millions) CAGR Forecast Recurring Fee Revenues FY08 FY09 FY10 FY11 FY12 FY13 FY08-FY13 FY14 ICS $ 567 $ 594 $ 632 $ 720 $ 798 $ 850 8% $923-931 Growth 7% 5% 6% 14% 11% 7% 8-9% SPS $ 534 $ 559 $ 536 $ 594 $ 655 $ 661 4% $687-695 Growth 1% 5% -4% 11% 10% 1% 4-
Slide 20: Reconciliation of Non-GAAP to GAAP Measures
Reconciliation of Non-GAAP to GAAP Measures Reconciliation of EPS Guidance 3Q13 3Q14 YTD13 YTD14 FY11 FY12 FY13 FY14 Range Actual Actual Actual Actual Actual Actual Actual Low High Diluted EPS (Non-GAAP) $0.39 $0.44 $0.74 $1.08 $1.47 $1.67 $1.88 $2.15 $2.25 Acquisition Amortization and Other Costs (
Slide 21: ICS Key Segment Revenue Stats
ICS Key Segment Revenue Stats RC= Recurring ED= Event-Driven In millions Fee Revenues 3Q13 3Q14 YTD FY13 YTD FY14 Type Proxy Equities $ 34.0 $ 37.9 $ 84.8 $ 88.3 RC Stock Record Position Growth 7% 7% 3% 3% Pieces 27.1 30.6 68.1 72.1 0.6 Mutual Funds $ 7.1 $ 9.5 $ 22.7 $ 36.0 ED Pieces 13.0 12.1 36.7
Slide 22: SPS Key Segment Revenue Stats
SPS Key Segment Revenue Stats RC= Recurring 3Q13 3Q14 YTD FY13 YTD FY14 Type ED= Event-Driven In millions Equity Transaction-Based Equity Trades $ 33.8 $ 35.5 $ 94.9 $ 101.4 RC Internal Trade Volume 917 1,053 828 959 Internal Trade Growth -2% 15% -9% 16% Trade Volume (Average Trades per Day in '000)
Slide 23: Broadridge ICS Definitions
Broadridge ICS Definitions Proxy Equities - Refers to the proxy services we providein connection with annual stockholder meetings for publicly traded corporate issuers. Annual meetings of public companies include shares held in "street name" (meaning that they are held of record by brokers or banks,
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