Alight, Inc. · NYSE:ALIT

Alight — Q1 2024 Earnings Presentation

19 slides from Alight's earnings presentation, May 8, 2024

  1. Slide 1: 1st Quarter 2024 Earnings Presentation

    1 st Quarter 2024 Earnings Presentation Alight, Inc. May 8, 2024 © 2024 Alight. All rights reserved.

  2. Slide 2: Disclaimer

    Disclaimer Forward-looking statements obligation to publicly update or review any forward-looking statement, whether as a result of new This presentation contains forward-looking statements within the meaning of Section 27A of the Securities information, future developments or otherwise, except as r

  3. Slide 3: Total Company First Quarter Summary Results

    Total Company First Quarter Summary Results — Starting in Q1 2024, financial statements will be presented on a Continuing Operations basis to reflect the pending disposition of the Payroll & Professional Services business — We will also present on a Total Company basis to allow comparability with th

  4. Slide 4: Continuing Operations First Quarter Summary Results

    Continuing Operations First Quarter Summary Results 1Q Revenue 1Q Adj. EBITDA1 KEY HIGHLIGHTS ($ in millions) ($ in millions) $586 $559 $116 Recurring Revenue 93.2% $112 as % of sales Up 50 bps y/y $576 BPaaS Revenue ↑20.6% $559 20.9% of total revenue Adjusted Gross Profit Margin2 % ↑120 bps $10 To

  5. Slide 5: Advancing profitable growth strategy

    Advancing profitable growth strategy (Commentary is on a Continuing Operations basis unless otherwise noted) 1 Strong revenue growth from BPaaS offset by non-recurring project work • BPaaS revenue grew nearly 21% to $117 million o BPaaS represented 20.9% of total revenues, up 440 basis points from t

  6. Slide 6: Go-forward benefits to anticipated divestiture of Professional Services and HCM & Payroll Outsourcing

    Go-forward benefits to anticipated divestiture of Alight’s Professional Services and HCM & Payroll Outsourcing businesses $1B Up to $200M ~$20M Earnings upfront gross proceeds seller notes temporary stranded costs (assumed in PF margin of ~25%) Power • Net upfront proceeds estimate of $750 million,

  7. Slide 7: Latest Alight Worklife release for 2024 focuses on AI-driven support

    Latest Alight Worklife® release for 2024 focuses on AI-driven support to enhance employee experience and employer ROI AI-powered workforce support New Alight LumenAI engine enhances various AI capabilities (including chatbots) while automation streamlines configuration process Comprehensive benefits

  8. Slide 8: Financial results

    Financial results 8 © 2024 Alight. All rights reserved.

  9. Slide 9: Total Company Alight Results

    Total Company Alight Results ($ in millions) 1Q24 1Q23 Change Revenue Under Contract3 As of 3/31/24 Revenue Total Revenue $816 $831 -1.8% 2024 $3.1B Revenue ex-Other (Hosted) $816 $821 -0.6% 2025 $2.2B BPaaS Revenue $208 $171 +21.6% 2026 $1.6B Adjusted Gross Profit1 $278 $285 -2.5% % margin 34.1% 34

  10. Slide 10: Continuing Operations Results

    Continuing Operations Results ($ in millions) 1Q24 1Q23 Change 1Q Highlights • Strong growth of nearly 21% in Revenue BPaaS revenues Total Revenue $559 $586 -4.6% • Continued strong expansion in adjusted gross profit margin1 Revenue ex-Other (Hosted) $559 $576 -3.0% • Adjusted EBITDA1 grew nearly 4%

  11. Slide 11: Strong capital structure expected to be bolstered by transaction proceeds

    Strong capital structure expected to be bolstered by transaction proceeds Total Company Operating Cash Flow ($M) ($ millions) 3/31/2024 12/31/2023 Total Debt $2,787 $2,794 Less Cash1 $286 $358 +38.9% $100 0.6x Net Debt $2,501 $2,436 • Well-protected in volatile interest rate environment $72 • Total

  12. Slide 12: Appendix – Non-GAAP Reconciliations

    Appendix – Non-GAAP Reconciliations © 2024 Alight. All rights reserved.

  13. Slide 13: Reconciliation of Continuing Operations Net Income (Loss) to Adjusted EBITDA

    Reconciliation of Continuing Operations Net Income (Loss) to Adjusted EBITDA (unaudited) Three Months Ended March 31, (in millions) 2024 2023 (1) Net Income (Loss) From Continuing Operations $ (121) $ (84) Interest expense 31 33 Income tax expense (benefit) (27) (23) Depreciation 26 22 Intangible am

  14. Slide 14: Reconciliation of Continuing Operations Gross Profit to Adjusted Gross Profit

    Reconciliation of Continuing Operations Gross Profit to Adjusted Gross Profit (unaudited) Three Months Ended March 31, 2024 ($ in millions) Employer Solutions Other Total Gross Profit $ 182 $ - $ 182 Add: stock-based compensation 5 - 5 Add: depreciation and amortization 21 - 21 Adjusted Gross Profit

  15. Slide 15: Reconciliation of Continuing Operations Net Income to Adjusted Net Income and Adjusted Diluted EPS

    Reconciliation of Continuing Operations Net (Loss) Income From Continuing Operations to Adjusted Net Income & Adjusted Diluted Earnings per Share From Continuing Operations (unaudited) Three Months Ended March 31, 2024 2023 (in millions, except share and per share amounts) Numerator: (1) Net Income

  16. Slide 16: Reconciliation of Total Company Net Income (Loss) to Adjusted EBITDA

    Reconciliation of Total Company Net Income (Loss) to Adjusted EBITDA (unaudited) Three Months Ended March 31 (in millions) 2024 2023 Net Income (Loss) $ (116) $ (74) Interest expense 31 33 Income tax expense (benefit) (12) (8) Depreciation 29 24 Intangible amortization 80 80 EBITDA 12 55 Share-based

  17. Slide 17: Reconciliation of Total Company Gross Profit to Adjusted Gross Profit

    Reconciliation of Total Company Gross Profit to Adjusted Gross Profit (unaudited) Three Months Ended March 31, ($ in millions) 2024 Gross Profit $ 249 Add: stock-based compensation 5 Add: depreciation and amortization 24 Adjusted Gross Profit $ 278 Gross Profit Margin 30.5% Adjusted Gross Profit Mar

  18. Slide 18: Reconciliation of Total Company Net Income to Adjusted Net Income and Adjusted Diluted EPS

    Reconciliation of Total Company Net (Loss) Income Attributable to Alight, Inc. to Adjusted Net Income & Adjusted Diluted Earnings per Share (unaudited) Three Months Ended March 31, 2024 2023 (in millions, except share and per share amounts) Numerator: Net (Loss) Income Attributable to Alight, Inc. $

  19. Slide 19: Total Company Revenue Disaggregation

    Total Company Revenue Disaggregation (unaudited) Three Months Ended March 31, ($ in millions) 2024 2023 Employer Solutions: Recurring $ 521 $ 533 Project 38 43 Total Employer Solutions 559 576 Revenue from Discontinued Operations 257 245 Total Revenue, excluding Hosted 816 821 (1) Other - 10 Total A

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