Slide 1: 3rd Quarter 2024 Earnings Presentation
3 rd Quarter 2024 Earnings Presentation Alight, Inc. November 12, 2024 © 2024 Alight. All rights reserved.
Slide 2: Disclaimer
Disclaimer Forward-looking statements results under applicable regulations. Additionally, certain of the information in this presentation is not presented in This presentation contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as accordance with GAAP
Slide 3: 3Q24 strategic highlights
3Q24 strategic highlights 1 Transformational achievements set the stage for Alight’s next chapter as technology-enabled services company • Completed divestiture on July 12th, 2024 for $1.0 billion in upfront gross proceeds, with up to $200 million in seller notes • Cloud migration completed with ini
Slide 4: 3Q24 financial results
3Q24 financial results (Excludes 11-day stub period from Payroll & Professional Services divestiture and financials from Hosted) ($ in millions) 3Q24 3Q231 Change Revenue Recurring Revenue $504 $505 -0.2% Project Revenue $51 $53 -3.8% Total Revenue $555 $558 -0.5% Adjusted Gross Profit2 $200 $207 -3
Slide 5: Financial guidance (99% of 2024 revenue under contract)
Financial guidance (99% of 2024 revenue under contract) (Raised revenue guidance with midpoint for FY24 increased by $10M) 4Q24 guidance Full Year 2024 guidance (proforma basis) $2,338 – $2,358M Revenue $665 – $685M Revenue (up from $2,325-$2,350M) BPaaS Revenue $144 - $154M BPaaS Revenue $497 - $50
Slide 6: Capital structure update
Capital structure update YTD Adj. Operating Cash Flow ($M) ($ millions) 9/30/2024 12/31/2023 $199 Total Debt $2,031 $2,794 • One-time separation costs of $57M and deal Less Cash $300 $324 $72 costs of $15M related to Payroll & Professional Services sale Net Debt $1,731 $2,470 • 1H24 Proforma adjustm
Slide 7: 4Q24 adjusted diluted EPS and modeling notes
4Q24 adjusted diluted EPS and modeling notes Adjusted diluted EPS bridge 4Q 2024 Notes Annual Modeling Notes Adjusted EBITDA $208-233M See slide 5 • Capital Expenditures4 mid-term target Depreciation $33-38M 5-6% of revenue ~4-5% of revenue, above 5% in 2024 Interest Expense $21-31M Based on current
Slide 8: Key Drivers of Revenue Growth
Key Drivers of Revenue Growth Growth Model 2024 Expectations Revenue from New Wins: Bookings with new logos & existing client +6 - 8% 4.5 – 5.5% 1 Prior guidance 4 – 5% expansions that go-live and add revenue to the existing base of recurring revenue, including project revenue sold during current ye
Slide 9: Path to Growth Model
Path to Growth Model +1 – 3% 4 - 6% +2 – 3% +2% (2.5) – (1.5)% 2024 Revenue Volume New Logos & Products, Pricing Target Annual Growth normalization Client Model & Revenue Growth Expansion Retention Near-term Mid-term COBRA volume Go-to-market momentum: Focus on services, partner headwind subsides in
Slide 10: Appendix-Proforma Adjustment Reconciliations
Appendix-Proforma Adjustment Reconciliations 10 © 2024 Alight. All rights reserved.
Slide 11: Background regarding proforma adjusted supplemental financial results
Background regarding proforma adjusted supplemental financial results Proforma adjusted supplemental financial results are designed to show the impact of the sale of the Payroll and Professional Services business as if it had happened at the beginning of 2023 with the objective of providing better c
Slide 12: 2023 3Q Total Revenue Disaggregation with Proforma Adjustments (unaudited)
2023 3Q Total Revenue Disaggregation with Proforma Adjustments (unaudited) Three Months Ended September 30, ($ in millions) 2023 Revenue: Recurring $ 497 Proforma Adjustments 8 Recurring - adjusted 505 Project 53 Total Revenue, excluding Hosted 558 Hosted Revenue 7 Total Revenue $ 565 12 Note: Profo
Slide 13: Reconciliation of 2023 3Q Gross Profit to Adjusted Gross Profit with Proforma Adjustments
Reconciliation of 2023 3Q Gross Profit to Adjusted Gross Profit with Proforma Adjustments (unaudited) Three Months Ended September 30, 2023 ($ in millions) Gross Profit $ 166 Add: stock-based compensation 7 Add: depreciation and amortization 19 Add: Proforma Adjustments 15 Adjusted Gross Profit $ 20
Slide 14: Reconciliation of Net Income (Loss) to Adjusted EBITDA with Proforma Adjustments
Reconciliation of Net Income (Loss) to Adjusted EBITDA with Proforma Adjustments (unaudited) Three Months Three Months Three Months Three Months Three Months Ended Ended Ended Ended Ended September 30, December 31, March 31, June 30, September 30, (in millions) 2023 2023 2024 2024 2024 Net Income (L
Slide 15: Reconciliation of 2024 3Q Operating Cash Flow with Proforma Adjustments
Reconciliation of 2024 3Q Operating Cash Flow with Proforma Adjustments (unaudited) Nine Months Ended (in millions) September 30, 2024 Net cash provided by continuing operating activities $ 75 Separation costs 72 Proforma Adjustments 52 Net cash provided by continuing operating activities w/ proform
Slide 16: Appendix-GAAP to Non-GAAP Reconciliations
Appendix-GAAP to Non-GAAP Reconciliations 16 © 2024 Alight. All rights reserved.
Slide 17: Reconciliation of Net Income (Loss) to Adjusted EBITDA (unaudited)
Reconciliation of Net Income (Loss) to Adjusted EBITDA (unaudited) 17 © 2024 Alight. All rights reserved.
Slide 18: Reconciliation of Gross Profit to Adjusted Gross Profit (unaudited)
Reconciliation of Gross Profit to Adjusted Gross Profit (unaudited) 18 © 2024 Alight. All rights reserved.
Slide 19: Reconciliation of Net (Loss) Income to Adjusted Net Income & Adjusted Diluted EPS
Reconciliation of Net (Loss) Income to Adjusted Net Income & Adjusted Diluted Earnings per Share (unaudited) (1) Excludes the impact of discontinued operations. Comparable periods have been recast to exclude these impacts. (2) Transaction and integration expenses primarily relate to acquisitions and