Slide 1: 1st Quarter 2022 Earnings Presentation
ton 1st Quarter 2022 Earnings Presentat Al , Inc. Kelahe 2022 May 9
Slide 2: Disclaimer
Disclaimer Forward-looking statements This presentation contains forward-4ooking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended. These statements include, but are not li
Slide 3: Growth strategy & results
Growth strategy & results alight
Slide 4: Transformation in 2022 & beyond supported by solid foundation
Transformation in 2022 & beyond supported by solid foundation 1Q22 Transformation metrics 122M aaS bookings Y/ $724 total!) 14M (1.23% YoY) 1% Solutions bps YoY) te 120 1 Cumulative total since 1Q 2021. Foundational metrics entering 2022 ° ? Retention defined as prior year’s active client revenue co
Slide 5: Execution of our strategy: Solid 1Q22 results as technology transformation drives momentum
Execution of our strategy 1 Solid 1Q22 results as technology transformation drives momentum * Total revenue growth, excluding Hosted, of +5.0% with BPaaS revenue +22.6% and Adjusted EBITDA’ +6.8% to $142M 2 Increased client recognition of employee engagement drove new client wins in 1Q * 205% y/y gr
Slide 6: Corporations face barriers to optimizing engagement in benefit programs
Corporations face barriers to optimizing engagement in benefit programs Copious vendors and point solutions to manage Qa. oa ala (d) Disparate data sources to understand return on value 1 Source: Alight internal research 6 Limited visibility into the entire ecosystem (including program utilization)
Slide 7: BPaaS Platform
Platform • • Content BPaaS • • Delivery • •
Slide 8: Leveraging Data to Drive Higher Utilization and Engagement for Clients
Leveraging Data to Drive Higher Utilization and Engagement for Clients Stenuptor dct dea Integrated, one-stop shop for HR and benefits programs promi. 8 emi 2 @ 0 Al-based Explore your programs recommendations Featured Pits View ot highlight wellbeing actions and programs When's the last time you ch
Slide 9: Case Study: How Alight Brings the Wellbeing Solutions to Employees
Case Study: How Alight Brings the Wellbeing Solutions to Employees Promote to more eyes Integrate with benefits (+4M Today’s existing wellbeing interactions/yr and at Alight) incentive engagement 40% level 25% level Personalize the next best actions Present “next best actions” in every visit 54% lev
Slide 10: Case Study: Alight Worklife Platform and Health Engagement Tier to Drive $5M+ Savings
Case Study: Alight Worklife Platform and Health Engagement Tier to Drive $5M+ Savings ae alight = Connect directly with your personal Benefit Pro Talk to a Benefit Don't face complex care and costs alone, Quick Links (Consider More») (Find o docto Explore the relevant quick links aigntcom = premier.
Slide 11: Investing $38M into our Transformation & Growth
Investing $38M into our Transformation & Growth Products & Technology Commercial Go To Market Federal Contract * Alight Worklife platform (now has 450+ clients) * One Alight market makers * Ontrack for go live Investment * Drives growth in 2H 2022 Areas * Mobile app * Content clouds * Solution archi
Slide 12: Financial results & outlook
Financial results & outlook alight
Slide 13: 1Q22 summary of consolidated results
1Q22 summary of consolidated results * Strong BPaaS revenue Ri ret and Employer Solutions 9 revenue growth partially Total Revenue $725M $689M oi2% offset by Professional Services Revenue ex-Hosted $713M $679M +5.0% * Acquisitions, as well as BPaaS Revenue $114M $93M +22.6% investments in federal co
Slide 14: Employer Solutions benefited from strong recurring revenue while making investments for future profitable growth
Employer Solutions benefited from strong recurring revenue while making investments for future profitable growth 4 Employer Solutions Employer Solutions Employer Solutions Revenue ($M) Gross Margin Adjusted EBITDA" ($M) _@B 34.2% 32.7% $587 $623 $136 $142 Recurring Project 1Q21 1Q22 1Q21 1Q22 1Q21 1
Slide 15: Professional Services positioned for project revenue recovery in 2H22
Professional Services positioned for project revenue recovery in 2H22 Professional Services Professional Services Professional Services 1Q22 Highlights Revenue ($M) Gross Profit ($M) Adjusted EBITDA! ($M) * 3.4% increase in recurring revenue consistent with $92 $90 strategic emphasis * Closed deals
Slide 16: Capital structure provides financial flexibility
Capital structure provides financial flexibility Debt Maturity Schedule as of 3/31/22 ($M)? Nowe aca cena | $2,500 2,474 Total Debt $2,858 $2,868 Less Cash $326 $372 $2,000 Net Debt $2,532 $2,496 $1,500 * Refinanced $2.0B in term loans early in 1Q22, which $1,000 lowered Term SOFR borrowing margin a
Slide 17: 2022 guidance
• • • • • 1 A reconciliation of this non-GAAP financial metric to its closest comparable GAAP metric is included in the appendix. Note: This information is based on management’s current expectations and estimates, which are based in part on market and industry data. Many factors are outside the cont
Slide 18: 2022 outlook assumptions and notes
• • • A reconciliation of this non-GAAP financial metric to its closest comparable GAAP metric is included in the appendix. 2 Assumes a 26% US tax rate (federal + state), with a higher average effective tax rate due to incremental tax in international jurisdictions. Due to significant tax amortizati
Slide 19: Appendix — Non-GAAP Reconciliations
Appendix — Non-GAAP Reconciliations alight
Slide 20: Net Loss to Adjusted EBITDA reconciliation, 1Q22
Successor Predecessor Three Months Ended Three Months Ended March 31, March 31, (in millions) 2022 2021 Net Loss $ (13) $ (21) Interest expense 29 62 Income tax expense (benefit) 1 (3) Depreciation 17 24 Intangible amortization 79 50 EBITDA 113 112 Share-based compensation 33 2 Transaction and integ
Slide 21: Adjusted 2021 EBITDA
Adjusted 2021 EBITDA Successor Predecessor ‘Three Months Ended Six Months Ended Six Months Ended Three Months Ended Year Ended December 31, December 31, June 30, December 31, December 31, Gn millions) 2021 2021 2021 2020 2020 2019 Net Income (Loss) $ R$ 8) | $ 25) $ (8) $ (103) $ 2 Interest expense
Slide 22: Segment Profit
Segment Profit (4) Successor Predecessor Three Months Ended Three Months Ended March 31, March 31, (in millions) 2022 2021 Employer Solutions $ 142 $ 136 Professional Services — — Hosted Business — (3) Total Adjusted EBITDA of all reportable segments 142 133 Share-based compensation 33 2 Transaction
Slide 23: Adjusted Net Income and diluted shares calculation
Three Months Ended March 31, (in millions, except share and per share amounts) 2022 Numerator: Net Loss Attributable to Alight, Inc. $ (11) Conversion of noncontrolling interest (2) Intangible amortization 79 Share-based compensation 33 Transaction and integration expenses 6 Restructuring 6 Gain fro