Broadridge Financial Solutions, Inc. · NYSE:BR
Broadridge Financial Solutions — Investor Day (December 2017)
130 slides from Broadridge Financial Solutions's investor day presentation, Dec 6, 2017
Slide 1: 2017 Investor Day
2017 Investor Day December 5, 2017 EXHIBIT 99.1
Slide 2: Forward-Looking Statements
Forward-Looking Statements Forward-Looking StatementsThe Broadridge 2017 Investor Day presentations 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 t
Slide 3: Agenda
Agenda TIME TOPIC SPEAKER 8:00-8:25 Introduction Rich Daly 8:25-8:50 Strategic Overview Tim Gokey 8:50-9:15 Governance Franchise Bob Schifellite 9:15-9:40 Capital Markets Franchise Charlie Marchesani 9:40−9:55 Break 9:55-10:15 Wealth Management Chris Perry 10:15-10:35 The Digital Future and Broadrid
Slide 4: Ready for Next
Ready for Next CASING FORMATSHeadlines:Sentence case; no punctuationSubheads under headlines: Sentence case; with punctuationSubheads in body copy/bullets: Sentence case; no punctuation
Slide 5: Broadridge Investor Day Introduction
Broadridge Investor Day Introduction Rich DalyChief Executive Officer
Slide 6: Broadridge is Ready For Next
Market dynamics driving strong growth for Broadridge’s technology-driven solutions Broadridge is Ready For Next Proven strategy and experienced management team to drive sustainable growth Uniquely positioned to deliver network value and capture additional, large market opportunities Successful track
Slide 7: Track record of growth and value creation
Track record of growth and value creation 9% CAGR RECURRING FEE REVENUE GROWTH BROADRIDGE SHARE PRICE 18%Annualized TSR $90 share price as of 12/1/17
Slide 8: Proven management team
Proven management team 1992 - Bob SchifelliteInvestor Communication Solutions 1992 - Charlie MarchesaniGlobal Technology and Operations 2014 - Chris PerryHead of Global Sales and Marketing 1989 - Rich DalyChief Executive Officer 2010 - Tim GokeyPresident and COO 2014 - Jim YoungChief Financial Offic
Slide 9: Execution against 2014 objectives
Execution against 2014 objectives Financial Objectives Revenue Growth Margin Expansion Adjusted Earnings Technology Product Set Sales & Marketing Investment Objectives
Slide 10: Differentiated value proposition
Differentiated value propositionCreating network valuePlatform enables economic efficienciesEnhanced compliance and risk capabilitiesData drives critical and real-time insightsFaster transition to new technologiesIndustry leading cyber-securityCompetitive advantage based on first mover advantage Mea
Slide 11: Strength of Governance and Capital Markets franchises
Strength of our Governance and Capital Markets franchises with growing breadth of products built or acquired Existing Businesses Positioned to go after real opportunities based on existing capabilities, supported by investments we have already made New Opportunities Market demand, pipeline and quali
Slide 12: Creating the Next Level of Growth and Return
Creating the Next Level of Growth and Return Tim GokeyPresident and Chief Operating Officer
Slide 13: Strong and growing global franchises
Broadridge has strong and growing global franchises in Governance and Capital Markets with compelling additional opportunity in Wealth Management
Slide 14: Unique platform business model and growth platforms
Unique platform business model Strong positions in a large and growing market Three attractive growth platforms On-ramp for next-generation technologies Highly effective culture Broadridge has strong and growing global franchises in Governance and Capital Markets with compelling additional opportuni
Slide 15: Platform-based business model creates unique value
Broadridge platform-based business model creates unique value Network value Deep financial services knowledge Multi-client managed services approach
Slide 16: Multi-client managed services approach creates value for all
Multi-client managed services approach creates value for all Multi-client technologyCommon operations modelOutcomes-based pricing with strict SLAsJoint governance ImproveQuality IncreaseFlexibility MutualizeChange ContinuouslyImprove Reduce Cost Helps Ensure Compliance
Slide 17: Competing in a large and growing market
Competing in a large and growing market Benefiting from a megatrend toward third-party technology and services $50B $93B $46B $79B $43B $67B $143B $125B $110B Projected CY’14-20CAGR:5%~
Slide 18: The industry's leading choice
The industry’s leading choice Governance Capital Markets Wealth Management Serve virtually every broker, fund, and public company in North AmericaProcess 80% of outstanding shares in the United States, 50%+ for rest of worldDistribute 90%+ of broker regulatory communications to 140M individual accou
Slide 19: Directly addressable market is $25-40B
Broadridge’s directly addressable market is $25-40B Large growth opportunity GOVERNANCE & COMMUNICATIONS WEALTH MANAGEMENT CAPITAL MARKETS
Slide 20: Key market trends support long-term growth
Key market trends support long-term growth Mutualization Digitization Data and Analytics Firms continue to search for mutualizationIncreasing demand for global solutionsDriven by new technologyIn the future, driven by network value Rise in preference for digital delivery across multiple channelsSucc
Slide 21: Three key opportunities
Broadridge is focused on three key opportunities, two of which are already strong franchises Address critical industry needs by utilizing our unique network and industry-leading platform capabilities EXTEND GOVERNANCE DRIVE CAPITAL MARKETS BUILD WEALTH MANAGEMENT
Slide 22: Extend Governance
Extend Governance Key OpportunitiesTransform regulatory communicationsDevelop omni-channel communicationsBuild issuer services 140M+RETAIL SHAREHOLDER ACCOUNTS 150,000+INSTITUTIONAL SHAREHOLDERS 24,000+ MUTUAL FUNDS 1,100+ BANKS and BROKER-DEALERS 5,000+CORPORATE ISSUERS
Slide 23: Drive Capital Markets
Drive Capital Markets Drive global technology platformExtend with additional solutionsCreate network value Data Fabric with Global Ontology Unified Portal Global Position Manager Global P&L Global Sub-Ledger Managed Services Options Core Components Connectivity Reference Data Netting &Allocation Cle
Slide 24: Build Wealth Management
Build Wealth Management Drive winning targeted solutionsCreate front-to-back platform of the futureWrap in next-generation digital and dataDrive best-of-suite solutions for investment managers Grow AdvisorBusiness Enhance ClientExperience Drive EnterpriseProductivity “ONE WEALTH” INTEGRATION ACROSS
Slide 25: Strengthen global
Strengthen global India Hong Kong U.K. Switzerland Germany Czech Republic Japan South Africa Australia Canada United States Russia Singapore Support key franchises globally Grow largestglobal clients Engage key regional clients European sales & support International development & support Swiss datac
Slide 26: Next-generation technology to meet client needs
Strongly positioned to help clients utilizenext-generation technology to meet their critical needs Blockchain Artificial intelligence Digital Cloud
Slide 27: Highly effective culture creates a durable advantage
Highly effective culture creates a durable advantage Clients Deliver real business value every day Shareholders Deliver top-quartile TSR Associates Highly Engaged Associates
Slide 28: Why Broadridge?
Why Broadridge? Unique platform business model Strong positions in a large and growing market Three attractive growth platforms On-ramp for next-generation technologies Highly effective culture
Slide 29: Broadridge Governance Franchise
Broadridge Governance Franchise Bob SchifellitePresident, Investor Communication Solutions
Slide 30: Governance franchise is critical to capital markets
The Governance franchise is critical to capital markets functioning, has a strong growth trajectory, and can be extended further
Slide 31: Broadridge at the center of a unique network
Broadridge, at the center of a unique network, powers corporate governance History of building new businesses by engaging the network Investments in technology create sustained growth for the entire network Business model sustained by strong macro trends including growth in fund and equity positions
Slide 32: Structure of US capital markets creates complexity
MUTUAL FUNDS RETAIL SHAREHOLDERS CORPORATEISSUERS INSTITUTIONAL SHAREHOLDERS 140M+RETAIL SHAREHOLDER ACCOUNTS 150,000+INSTITUTIONAL SHAREHOLDERS 24,000+ MUTUAL FUNDS 5,000+CORPORATEISSUERS BANKS and BROKER-DEALERS 1,100+ BANKS and BROKER-DEALERS Structure of US capital markets creates significant co
Slide 33: Center of a unique network powering corporate governance
Broadridge, at the center of a unique network, powers corporate governance 140M+RETAIL SHAREHOLDER ACCOUNTS 150,000 +INSTITUTIONAL SHAREHOLDERS 24,000+ MUTUAL FUNDS REGULATORY BODIES Issuers of Securities Shareholders 1,100+ BANKS and BROKER-DEALERS 5,000+CORPORATE ISSUERS
Slide 34: Critical solutions to all network participants: banks and brokers
And provides critical solutions to all network participants Regulatory responsibility for issuer-shareholder communications____________________________Key Solutions include:Corporate and class actions1st dollar prospectus Digital communicationsTax services Banks and broker-dealers Issuers of Securit
Slide 35: Critical solutions: corporate issuers and mutual funds
5,000+CORPORATE ISSUERS Regulatory responsibility for shareholder meetings and communications____________________________Key Solutions include:Corporate issuer solutions including document managementFund shareholder reportsShareholder and channel analytics CORPORATE ISSUERS ANDMUTUAL FUNDS Issuers o
Slide 36: Critical solutions: institutional shareholders
Institutional SHAREHOLDERS Issuers of Securities Shareholders 150,000+INSTITUTIONAL SHAREHOLDERS 1,100+ BANKS and BROKER-DEALERS 140M+RETAIL SHAREHOLDER ACCOUNTS REGULATORY BODIES 24,000+ MUTUAL FUNDS 5,000+CORPORATE ISSUERS And provides critical solutions to all network participants Obligation to v
Slide 37: Critical solutions: retail shareholders
Right to receive shareholder communications and participate in governance___________________________Key Solutions include:Retail shareholder data solutionsRetail engagement solutions RETAIL SHAREHOLDERS Issuers of Securities Shareholders 1,100+ BANKS and BROKER-DEALERS REGULATORY BODIES 150,000+INST
Slide 38: Across global markets
Across global markets 50,000+ public companies100 countries 5.4 trillion shares 7.6 million positionsKey Solutions include:Annual meeting servicesData & analytics solutions
Slide 39: Case study: Fortune Annual Meeting process
Case study: Fortune 500 Annual Meeting process KICK OFF MEETING PROCURE DATA DISTRIBUTE COMMUNICATIONS RECEIVE VOTES REPORT VOTE ISSUERS BROADRIDGE BROKER- DEALERS Announce record and meeting dates Decide N&A vs full package and postal tiers Receive final vote tally Create agenda and code proposalsC
Slide 40: Broadridge drives significant industry savings
Broadridge drives significant industry savings PRINT, PAPER AND POSTAGE COST TO CORPORATE ISSUERS FOR PROXY IN FY17 DELIVERY METHOD $0.05-$0.25 $0.16-$0.32 REGULATED INCREMENTAL BROKER FEE $15B savings to equity and fund issuers over last decadeSuppression increases continue:49% in 2008 to 70% in 20
Slide 41: Record of building businesses from our unique network
We have a record of building businesses from our unique network REGULATORY CORPORATE ISSUER DATA & NETWORK DRIVEN 3 YR CAGR 7% 16% 16% KEY SOLUTIONS Banks and broker-dealersMutual funds, ETFs and retirement providers Transfer agencyMeeting servicesDocument management Data and analyticsTax managed se
Slide 42: Net position growth positive every year
Net position growth was positive every year even during the worst downturn since the Great Depression Strong position growth makes our regulatory business model sustainable and resilient CAGR 9% 3%
Slide 43: Growing Issuer business through adjacencies
Growing Issuer business through aggressively expanding into adjacencies DOCUMENT MANAGEMENT ISSUER PRINT BENEFICIAL PROXY VALUE SHAREHOLDER DATA SERVICES TRANSFER AGENT, INCLUDING SHARELINK® TOTAL VALUE Beneficial positions 2,294 Registered positions 1,196
Slide 44: Portfolio of data solutions
We have utilized the network to build a strong portfolio of data solutions FY10-FY14 Wealth Insights (WINS)Shareholder Data Services (SDS) US Market IntelligenceGlobal Dividends Reclaim Opportunity HunterGlobal Market IntelligenceInvestor Analytics Sales and Market AnalyticsDistribution Insights and
Slide 45: Our commitment: invest in technology-driven solutions
OUR COMMITMENT Invest in technology-driven solutions to create sustained growth and scaled benefits for the entire network Data Blockchain Digital
Slide 46: Governance franchise summary
3-9% $9B-$13B Broadridge, at the center of a unique network, powers corporate governance History of building new businesses by engaging the network Investments in technology create sustained growth for the entire network Business model sustained by strong macro trends including growth in fund and eq
Slide 47: Broadridge Capital Markets Franchise
Broadridge Capital Markets Franchise Charlie MarchesaniPresident, Global Technology and Operations
Slide 48: Leading global provider of capital markets technology infrastructure
As a leading global provider of capital markets technology infrastructure, Broadridge is driving simplification and transformation globally for our clients and the industry
Slide 49: Well-positioned to lead in a growing market
Well-positioned to lead in a growing market Large market opportunity provides a strong path for growth Uniquely positioned to be the on-ramp for technology innovation Global Post Trade Management solution simplifies and transforms As a leading global provider of capital markets technology infrastruc
Slide 50: Firms face a difficult business environment
Firms continue to face a difficult business environment CURRENT STATE KEY BUSINESS CHALLENGES Regulatory change and compliance costs continue to pressure ROECompetitive pricing pressuresLimited investments in innovation and transformation INSTITUTIONAL SELL-SIDE REVENUES FLAT AND BELOW HISTORICAL LE
Slide 51: Capital Markets priorities
CAPITAL MARKETS PRIORITIES Focus on simplification and transformation to realize cost efficiency/ROE improvements Evolve global operating models to increase transparency, control and risk mitigationAccelerate adoption of new technologies to lower cost structures and provide greater scale and agility
Slide 52: Leading market position
Process for 18 of the 23 US Fixed Income primary dealersProcess Equities for 7 of the top 10 global investment banksClear and settle in over 80 markets internationally Leading market position Well-positioned to lead in the large, growing market for SaaS-based global capital markets infrastructure Su
Slide 53: Solution Components
Solution Components SOLUTION COMPONENTS We have invested to capitalize on this global opportunity Data Fabric with Global Ontology Unified Portal Global P&L Global Sub-Ledger Managed Services Options Asset Class and Function Coverage Core Components Connectivity Reference Data Netting &Allocation Cl
Slide 54: Transforming post trade processing globally through one platform
Unified Portal Data Fabric Global Post Trade Management SITUATION TODAY PRODUCT LINE CURRENT TECHNOLOGY NA equities In-house & licensed solutions US fixed income Broadridge EMEA fixed income In-house build Asia fixed income Multiple In-house builds LATAM fixed income In-house build Treasury solution
Slide 55: Extending asset class coverage
Extending assetclass coverageExtending beyond our core capabilities Regulatory reportingNatural extension of our post trade processing capabilities Product extensionsExpanding our post trade footprint to global enterprise solutions Significant opportunities to grow business through expansion into na
Slide 56: The power of network value
The power of network value Accelerate industryoperational transformation ACCELERATE Align the buy side and sell side ALIGN Create solutions to solve industry challenges CREATE
Slide 57: On ramp to advanced technology and innovation
Uniquely positioned to provide the on ramp to advanced technology and innovation opportunities globally Be an innovation leader by partnering on tangible operational use cases BLOCKCHAIN Lead the industry in migration to Cloud CLOUD COMPUTING Mutualize investments to drive the next generation of ope
Slide 58: Broadridge bilateral repo operational test case
GOALSProve the potential benefits of blockchain technology First step in a broader effort to apply blockchain solutions across collateral management WHY?Solve for operational and structural inefficiencies Reduce operational & counterparty riskFaster and more accurate transaction execution WHAT?Broad
Slide 59: Large market opportunity provides path for growth
Large market opportunity provides path for continued strong growth IMMEDIATELY ADDRESSABLE (~$10B) includes current products and features BROAD ADDRESSABLE (+~$5B) includes near adjacencies and product extensions CAPITAL MARKETS: ADDRESSABLE MARKET OPPORTUNITY ~$10B ~$5B EXISTING ADDRESSABLE~$15B IM
Slide 60: Well-positioned to lead in a growing market
Well-positioned to lead in a growing market Large market opportunity provides a strong path for growth Uniquely positioned to be the on-ramp for technology innovation Global Post Trade Management solution simplifies and transforms As a leading global provider of capital markets technology infrastruc
Slide 61: 2017 Investor Day
2017 Investor Day December 5, 2017
Slide 62: Broadridge Wealth Management
BroadridgeWealth Management Chris PerryPresident, Global Sales, Marketing, & Client Solutions
Slide 63: Wealth management capabilities create significant opportunity
The combination of our wealth management capabilities and the evolution of the industry creates significant opportunity for Broadridge
Slide 64: Wealth management opportunity: key points
The combination of our wealth management capabilities and the evolution of the industry creates significant opportunity for Broadridge Our platform addresses investment managers’ need to modernize technology infrastructure Broadridge has built a strong solution set and substantial client footprint M
Slide 65: Our powerful suite of wealth solutions
Our powerful suite of wealth solutions Advisory Front OfficeInvestor & advisor portalsDigital advisor tools Marketing, communications, & content managementInvestor education Retirement planning Middle OfficeClient on-boardingPerformance reportingAdvisor education & registrationCommissions & fee bill
Slide 66: Our substantial market presence
Our substantial market presence 25%+of all US financial advisors utilize Broadridge’s front office solutions 228,000+agents and advisors are supported by Broadridge’s data aggregation solution 50+ Millionaccounts serviced on Broadridge’s trade processing platforms $7+ trillion in assets custodied on
Slide 67: Market needs and sector trends
Market needs Digital advisory experience Major demographic shifts Sector trends ‘Bionic’ tech-augmented advisor Move to fee-based advisory in wealth management Next generation operations Regulations and technology pressuring profits Infrastructure optimization Growing preference for low cost and pas
Slide 68: Our strategy to grow our Wealth revenue
Drive growth of our targeted point solutions Offer an integrated “One Wealth” platform that provides enhanced capabilities across the entire wealth lifecycle Enrich the value of our solutions via digitization, data, and artificial intelligence Our strategy to grow our Wealth revenue
Slide 69: Continue to drive growth of targeted point solutions
Continue to drive growth of our targeted point solutions BROADRIDGE POINT SOLUTIONS GROWTH DRIVERS Client on-boarding Advisor solutions Performance analytics & reporting Advisor compensation solutions Retirement services Data aggregation Cross selling Solution bundles Strategic integration Grow adja
Slide 70: Integrated "One Wealth" platform
Integrated “One Wealth” platform Optimizes advisor productivity, client experience, and enterprise operations Wealth management tools Targeted marketing Wealth portal with mobile access and integrated account opening tools Educational content Enriched, digital communicationsTrading and account servi
Slide 71: "One Wealth" solution ranked #1 by Celent
Our “One Wealth” solution recently ranked #1 by Celent Broadridge demonstrates a dedication to developing its digital proposition and empowering the advisor and client through, for example, its three-prong implementation approach of AI and strong mobile apps. − Celent, “North American Wealth Front t
Slide 72: Enriching the value of our solutions via innovation
Communications CloudOur Communications Cloud enables wealth firms to collaborate with investors, through the digital channels they select Communicate and collaborate with clients Enriching the value of our solutions via innovation “Golden Copy” Our market-leading data aggregation provides a holistic
Slide 73: Our investment management solution suite
Our investment management solution suite Key trends driving sector needs Increased regulationRevenue pressureShifting service models Our powerful investment management offeringsPortfolio and order management, risk, compliance, and data managementRevenue and expense managementAccounting and general l
Slide 74: Wealth management opportunity summary
The combination of our wealth management capabilities and the evolution of the industry creates significant opportunity for Broadridge Our platform addresses investment managers’ need to modernize technology infrastructure Broadridge has built a strong solution set and substantial client footprint M
Slide 75: The Digital Future and Broadridge Customer Communications
Doug DeSchutter President, Broadridge Customer CommunicationsMichelle Jackson Managing Director, Broadridge Digital Solutions The Digital Future and Broadridge Customer Communications
Slide 76: Digital platform provides foundational capabilities
Broadridge’s digital platform provides foundational capabilities for our Governance franchise and drives growth opportunities for BRCC
Slide 77: Digital platform key points
Broadridge’s digital platform provides foundational capabilities for our Governance franchise and drives growth opportunities for BRCC Consumers are digital, but brands struggle converting their customers from print to digital Broadridge has a strong track record of digital transformation We are inv
Slide 78: Consumers are digital, but brands struggle converting from print
Consumers are digital, but brands struggleconverting their customers from print to digital US ADULTSMAKING $75K+ 70%Use paper DISTRIBUTION OF BILLS AND STATEMENTS 98%Internet users 2%Offline 30% Exclusively digital 20% “Double Dippers” Sources: Pew Research Center, 2016, Aite Group, 2017, InfoTrends
Slide 79: Brands struggle to digitally engage customers
Brands also struggle to digitally engage their customers Retail Banking Wealth Management Insurance Utilities Active digital customers Sources: Broadridge Data Analysis and Quantcast
Slide 80: Strong track record of digital transformation
Broadridge has a strong track record of digital transformation Customer Communications2 Presentment & Payment Notifications Cloud Delivery E-Delivery Proxy & Other Regulatory1 Data & Analytics Suppression Algorithms Summary Prospectus E-Delivery Investor Mailbox Enhanced Broker Internet Platform Mob
Slide 81: Print to digital conversion economics
Print to digital conversion economics benefit both brands and Broadridge (illustrative) PRINT Fee Revenue Paper and Postage DIGITAL DIGITAL Saves billions in communications costs Drives greater profit potential Profit Fee Revenue PRINT Distribution Revenue Profit BRANDS Processing Processing
Slide 82: Accelerating print-to-digital transition
Network Effect 3 We are investing to accelerate the“print-to-digital” transition for our clients Our digital growth strategy is focused on 3 levers Enhanced Reach 2 IN MARKET TODAYMaking every communication more valuablePersonalized communicationsData-driven content BEING LAUNCHEDExpandingconsumer r
Slide 83: Platform creates a valuable Network Effect
Sources: SharesPost, 2017 and Broadridge Data Analysis Broadridge’s platform creates a valuable “Network Effect” for both brands and consumers OPPORTUNITY TO BECOME A 21ST CENTURY DIGITAL COMMUNICATIONS HUB HEALTHCARE WEALTH TELECOM 5B+Annual communications ONLINE BANKING 97% US digital consumers co
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Slide 86: MESSAGES 5m ago
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Slide 90: ARENA A Jl
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Slide 91: NACC acquisition generates expansion opportunities
NACC acquisition generates attractive expansion opportunities and paves the way for future digital growth ACQUISITION RECAP Compelling near-term financial benefits Attractive mid-term expansion opportunity Larger long-term opportunity $20 million of annualized synergies to be achieved by FY’19 Broad
Slide 92: Key milestones to track
Broadridge’s Digital platform provides foundational capabilities for our Governance franchise and drives growth opportunities for BRCC Meaningful outsourcing winsMix of wins with digital componentLaunch of digital solutionsPartnership announcements that further extend the reach of our digital platfo
Slide 93: Broadridge International
Broadridge International Tom Carey President, Broadridge International
Slide 94: Sizeable, rapidly growing presence in EMEA and Asia-Pacific
Broadridge has a sizeable, rapidly growing presence in EMEA and Asia-Pacific Industry trends, combined with a ~$5B market opportunity creates the ability to continue our growth Driving growth through multi-year opportunities with our largest clients, expanding with regional clients, and offering mar
Slide 95: Our growing presence across EMEA and APAC
Our growing presence across EMEA and APAC We have expanded our global footprint to address growing client demands London Frankfurt Tokyo Hong Kong Singapore Sydney Edinburgh Johannesburg Prague Gdansk St Petersburg Hyderabad Bangalore
Slide 96: Growing presence across EMEA and APAC: milestones
Our growing presence across EMEA and APAC YEAR LOCATION KEY MILESTONE 2013 Europe Signs large post-trade utility client Partners with Accenture to create Eurasia post-trade 2014 Europe Creates European data center Australia Signs largest local market clearer 2015 Europe Second post-trade utility cli
Slide 97: Growth Opportunities
Growth Opportunities Building from North American relationships and now with regional clientsBroadridge brand and execution capability seen as increasingly attractivePartnerships have increased our market channelsGrowth balanced across Capital Markets, Governance and Investment Management Delivering
Slide 98: Key industry drivers will accelerate our growth
Key industry drivers will accelerate our growth Regulatory & Compliance Regulatory pressure continues to drive budget decisionsRegional regulations have a global impact, e.g. MiFID-II Globalization Shift to global solutions over regional or asset-based choicesNeed to optimize capital and collateral
Slide 99: Market factors enhance ability to address $5B market
Market factors enhance Broadridge’s abilityto address $5B international market Capital Markets Globalization of marketsContinued cost pressure to improve ROERegulatory change continues and has global impacts Investment Management Fee pressure driving cost rationalization Higher scrutiny on money mov
Slide 100: Delivering growth in International
Delivering growth in International Delivering ‘Ready for Next’ to the market by becoming the preferred global provider Significant opportunities with our large global clients Greater access to regional clients with our broad portfolio Meeting market needs with new solutions Offering integrated solut
Slide 101: Expanding product portfolio with a Global Tier client
Expanding our portfolio of products with a Global Tier 1 Long-term client of our US business expanded its relationship with Broadridge, resulting in $17M of new recurring revenue sales in International US EMEA ASIA Governance Equity Post-Trade Fixed Income Post-Trade Managed Services
Slide 102: Geographic expansion in key markets: Japan
Geographic expansion in key markets: Japan Capital MarketsProviding deep local market capabilities and ability for Japanese clients to process globallyAwarded Japanese government contract in 2013Significant new client wins in 2016/2017 Established in 1998 government policies creating ongoing market
Slide 103: Well-positioned to drive International growth: market opportunity
Well-positioned to drive International growth Capital Markets $2.6B Investment Management $1.7B Governance $0.7B Large market opportunity
Slide 104: Well-positioned to drive International growth
Well-positioned to drive International growth Delivering ‘Ready for Next’ to the market by becoming the preferred global provider Offering integrated solutions that address the challenges of today and tomorrow Delivering strong organic growth with favorable market dynamics
Slide 105: International summary
Broadridge has a sizeable, rapidly growing presence in EMEA and Asia-Pacific Industry trends, combined with a ~$5B market opportunity creates the ability to continue our growth Driving growth through multi-year opportunities with our largest clients, expanding with regional clients, and offering mar
Slide 106: MV Foundation Residential Bridge Camp CASING FORMATSHeadlines:Sentence case; no punctuationSubheads under headlines: …
MV Foundation Residential Bridge Camp CASING FORMATSHeadlines:Sentence case; no punctuationSubheads under headlines: Sentence case; with punctuationSubheads in body copy/bullets: Sentence case; no punctuation
Slide 107: 2017 Investor Day
2017 Investor Day December 5, 2017
Slide 108: Financial Overview
Financial Overview Jim YoungChief Financial Officer
Slide 109: Key points for today's discussion
Key points for today’s discussion Broadridge has a strong business model with compelling growth opportunities Strong free cash flow enables balanced, shareholder-friendly capital allocation Three-year objectives constitute a plan for continued top quartile TSR
Slide 110: Achieved multi-year objectives
Achieved multi-year objectives and demonstrated strong growth performance 2014 Investor Day 3-Year Objectives Excluding NACC Actuals Recurring Fee Revenue 7% - 10% 7% 14% Total Revenue 5% - 7% 6% 17% Adjusted Op Income Margin % 18.6% - 19.5%1 18.9% 15.0% Adjusted Net Earnings 9% - 11% 9% 11% 1 2014
Slide 111: Broadridge business model is strong
Broadridge business model is strong Sustainable Growth Large, recurring revenue base with good visibilityOrganic strength driven by large addressable market opportunity Steady Margin Expansion Continued scale and operational leverageFocus on operational efficiencies Strong Free Cash Flow 100+% free
Slide 112: High quality revenue stream
High quality revenue stream $4.1B Total FY17 Revenues Event-Driven Fee (5%) ~$200MAnnual Average (FY15-FY17) $0.2B Distribution (38%) <10% Gross Margin $1.6B Recurring Fee (59%) 14% CAGR (FY14-17) 6 yrsAverage Contract Length 5% Organic CAGR (FY14-17) 98% Revenue Retention Rate $2.5B Note: Revenue c
Slide 113: Two strong and growing segments
Two strong and growing segments INVESTOR COMMUNICATION SOLUTIONS $3.4B Total Revenue $0.2B 12.3%Margin 6%Organic Growth Key Businesses Key Businesses GovernanceCustomer CommunicationsData Driven Solutions Capital Markets InfrastructureWealth ManagementInvestment Management 21.1%Margin 6%Organic Grow
Slide 114: Record sales create revenue backlog and visibility
Record sales create revenue backlog and visibility CLOSED SALES PERFORMANCE NEW RECURRING REVENUE BACKLOG 14% CAGR Total~$250M Not Yet Live~$170M Note: Total New Recurring Revenue Backlog represents an estimate as of FYE17 of first year revenues from Closed Sales that have not yet been recognized an
Slide 115: Steady margin expansion
Steady margin expansion Contributors to Adjusted Operating Income Margin Expansion Scale & Productivity ▲ Margin contribution from new business and internal growth Product Mix ▲ Growing share of recurring fee revenue Distribution Revenue ▲ Conversion to digital delivery M&A ▼ Primarily weighted to e
Slide 116: Free cash flow strength and predictability
Free cash flow strength and predictability FY17 Free cash flow as a % of Adjusted Net earnings High Conversion 106% Low Capital Intensity FY17 Capital expenditures as % of total Revenue 2.7% Note: Free cash flow and Adjusted Net earnings are Non-GAAP measures. See Appendix for reconciliation of Non-
Slide 117: Capital allocation priorities
Capital allocation priorities Strong Dividend Target ~45% payout ratio1Top quartile payout ratio compared toS&P 500 and leads peer group $0.4B Returned to shareholders during FY15 – FY17 Disciplined M&A $0.8B Compelling returnsAccretive to EPS within first 12-18 monthsFocus on tuck-in acquisitions I
Slide 118: Investing to support growth strategies through M&A
Investing to support growth strategies through M&A Investment Themes Digital Capital Markets adjacenciesData & AnalyticsWealth & Investment Management $0.8B M&A spend FY15 – FY17 12 # of deals FY15 – FY17 $69M Average deal size APPROACHDisciplined underwritingClear criteriaCompelling returns
Slide 119: Ample capital provides flexibility to invest
Ample capital provides flexibility to invest Expected available capital FY18-FY20 $0.1B 1 2 3 4 1 Approximately $0.1B of Broadridge’s 6/30/2017 cash balance of approximately $0.3B is considered available and not needed for working capital or regulatory purposes2 Free cash flow, “FCF”, is a Non-GAAP
Slide 120: New sales drive organic recurring revenue growth
New sales drive organic recurring revenue growth Net New Business Internal Growth Total Organic Growth Acquisitions 5-6% FY17- FY20 Objective (CAGR) 0-1% 5-7% ~2% Total Recurring Revenue 7-9% 4% 2% 5% 10% FY14- FY17 (CAGR) Note: Totals may not sum due to rounding
Slide 121: Recurring fee revenue driving total revenue growth
Strength in recurring fee revenue driving total revenue growth % of Revenue FY17- FY20 CAGR Objective Recurring Fee Revenue ~60% 7-9% Event-Driven Revenue ~5% 0-1% Distribution Revenue ~35% 1-2% Total Revenue 100% 5-7% Note: Objectives shown as compound annual growth rates (CAGRs)
Slide 122: FY17-FY20 three year growth objectives
Recurring Fee Revenue Growth 7-9% Total Revenue Growth 5-7% Adjusted Op Income Margin Expansion ~50bps/yr Adjusted EPS Growth1 9-13% Winning formula for top quartile TSR FY17 - FY20 three year growth objectives Note: Compound annual growth rates (CAGRs), except margin1 Adjusted EPS CAGR includes Exc
Slide 123: Key points for today's discussion
Key points for today’s discussion Broadridge has a strong business model with compelling growth opportunities Strong free cash flow enables balanced, shareholder-friendly capital allocation Three-year objectives constitute a plan for continued top quartile TSR
Slide 124: Conclusion
Conclusion Rich DalyChief Executive Officer
Slide 125: Core franchises poised for sustained growth
Core Governance and Capital Markets franchises poised for sustained growth Broadridge is Ready For Next Well-positioned to address tangible and compelling additional growth opportunities Strong financial model focused on delivering top quartile total shareholder returns through 2020 and beyond
Slide 126: Ready for Next - Q&A
Ready for Next Q&A pa Broadridge
Slide 127: Ready for Next
Ready for Next ea Broadridge No partof this document may be distributed, reproduced or posted without the express written permission of Broadridge Financial Solutions, inc (©2017 Broadridge Financial Solutions, Inc. All rights reserved. Broadridge and the Broadridge logo are registered trademarks of
Slide 128: Appendix
Ready for Next Appendix @ Broadridge
Slide 129: Use of Non-GAAP Financial Measures
Use of Non-GAAP Financial Measures Explanation and Reconciliation of the Company’s Use of Non-GAAP Financial MeasuresThe Company’s results in the Broadridge 2017 Investor Day presentations are presented in accordance with U.S. generally accepted accounting principles ("GAAP") except where otherwise
Slide 130: Reconciliation of GAAP to Non-GAAP Measures
Reconciliation of GAAP to Non-GAAP Measures (Unaudited - dollars in millions, except per share amounts) Fiscal Years Ended June 30, 2017 2017 2016 2016 2015 2014 Operating income (GAAP) $ 531.6 $ 500.3 $ 466.9 $ 418.2 Adjustments: Amortization of Acquired Intangibles and Purchased Intellectual Prope
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