Slide 1: FactSet Earnings Call Fourth Quarter Fiscal 2023
Thursday, September 21, 2023 FactSet Earnings Call Fourth Quarter Fiscal 2023 Copyright © 2022 FactSet Research Systems Inc. All rights reserved. FactSet Confidential: Business Do not Useforward. Only
Slide 2: Forward-Looking Statements and Non-GAAP Measures
Forward-Looking Statements and Non-GAAP Measures This presentation, and other statements that FactSet may make in connection with this presentation, contains forward-looking statements based on management's current expectations, assumptions, estimates, forecasts and projections about future events a
Slide 3: Agenda
Agenda • Welcome • Business Update • Financial Overview • Questions and Answers • Appendix Copyright © 2023 FactSet Research Systems Inc. All rights reserved. FactSet Business Use Only 3
Slide 4: We continued to deliver on our strategy
We continued to deliver on our strategy: To build the leading open content and analytics platform that delivers differentiated advantage for our clients’ success Next Scale Up Generation Client Our Content Workflow Obsession Refinery Solutions Industry leading analytics and middle office solutions d
Slide 5: Key Metrics - Fourth Quarter 2023
Key Metrics - Fourth Quarter 2023 7.1% 33.6% $2.93 1 2 2 ORGANIC ASV + ADJUSTED ADJUSTED PROFESSIONAL SERVICES + OPERATING + DILUTED GROWTH MARGIN EPS Driven by the strength of our 210 bps higher YoY due to 6.4% decrease YoY due to recurring sales model and lower bonus accrual, partially higher tax
Slide 6: ASV + Professional Services Growth Rates by Global Segments & Businesses
ASV + Professional Services Growth Rates* – By Global Segments & Businesses $2.2B Organic ASV + Professional Services + 7.1% $559M $217M EMEA ASIAPAC $708M +8% +8% $922M ANALYTICS & $23M PRO SVCS (-6%) TRADING RESEARCH & +9% ADVISORY $1,377M +5% $545M AMERICAS CTS +7% +9% * LTM Organic ASV Growth Ra
Slide 7: Fiscal 2023 Results vs. Guidance
Fiscal 2023 Results vs. Guidance FISCAL 2023 GUIDANCE 1 FISCAL 2023 Results Organic ASV + Professional Services Growth2 $145 - $175M $145M = Revenues3 $2,080 - $2,100M $2,086M + Operating Margin3 29.0% - 30.0% 30.2% + Adjusted Operating Margin3,4 35.0% - 36.0% 36.2% + Effective Tax Rate3 14.0% - 15.
Slide 8: Fourth Quarter 2023 Financial Results
Fourth Quarter 2023 Financial Results* (in thousands, except per share data) 7.3% 7.2% (11.4)% 14.4% (460)bps 210bps Revenues Organic Revenues Operating Income Adjusted Operating Operating Margin Adjusted Operating 8/31/23 $535,797 8/31/23 $535,224 8/31/23 $117,103 Income 8/31/23 21.9% Margin 8/31/2
Slide 9: Key Operational Metrics
Key Operational Metrics >95% 189,972 ASV RETENTION USER COUNT ASV retained from clients over the last twelve Number of individuals accessing FactSet’s months. solutions. No change versus 2022 | Q4 6% change since 2022 | Q4 91% CLIENT RETENTION 7,921 CLIENT COUNT Percentage of clients retained over t
Slide 10: We remain focused on returning capital to shareholders
We remain focused on returning capital to shareholders FactSet resumed share repurchases in the third fiscal quarter of 2023 (in millions except share price) $403.44 $410.64 $330.26 $270.10 $241.08 $197.06 $162.62 $220 $201 $265 $19 $177 $261 $304 $118 $126 $139 $89 $100 $110 $81 '17 '18 '19 '20 '21
Slide 11: Fiscal 2024 Outlook
At the midpoint, guidance for fiscal 2024 reflects ASV growth of 7% and adjusted operating margin of 36.5%, an expansion of 30bps over fiscal 2023 FISCAL 2024 OUTLOOK As of September 21, 2023 Organic ASV + Professional Services Growth1 $130 - $175M Revenues $2,210 - $2,230M Operating Margin 33.1% -
Slide 12: Appendix
Appendix
Slide 13: ASV + Professional Services Growth Rates - Preliminary View by New Business Alignment
ASV + Professional Services Growth Rates* – Preliminary View by New Business Alignment $2.2B Organic ASV + Professional Services + 7.1% $277M WEALTH +9% $355M $1,109M PARTNERS 7% INSTITUTIONAL BUY-SIDE 6% $434M DEALMAKERS 8% * LTM Organic ASV Growth Rate is based on last twelve months as of August 3
Slide 14: Fourth Quarter 2023 Adjusted Operating Income Walk
Fourth Quarter 2023 Adjusted Operating Income Walk US$ millions 536 228 26 50 18 35 180 Revenue People Third Party Technology Real Estate Other Adjusted Operating Content Income Figures as of August 31, 2023 Copyright © 2023 FactSet Research Systems Inc. All rights reserved. FactSet Business Use Onl
Slide 15: Non-GAAP Reconciliations: Organic Revenues
Non-GAAP Reconciliations Organic Revenues (in thousands) FOR THE THREE MONTHS ENDED AUGUST 31 FOR THE YEAR ENDED AUGUST 31 (Unaudited) 2023 2022 % Change 2023 2022 % Change GAAP Revenues $ 535,797 $ 499,297 7.3% $ 2,085,508 $ 1,843,892 13.1% Deferred revenue fair - - - 25 value adjustment Adjusted r
Slide 16: Non-GAAP Reconciliations: Adjusted Operating Income, Margin, Net Income
Non-GAAP Reconciliations Adjusted Operating Income, Margin, Net Income (in thousands, except per share data) FOR THE THREE MONTHS ENDED AUGUST 31 FOR THE YEAR ENDED AUGUST 31 (Unaudited) 2023 2022 % Change 2023 2022 % Change GAAP Operating Income $ 117,103 $ 132,219 (11.4)% $ 630,207 $ 475,482 32.5%
Slide 17: Non-GAAP Reconciliations: Adjusted EBITDA
Non-GAAP Reconciliations Adjusted EBITDA (in thousands) FOR THE THREE MONTHS ENDED AUGUST 31 (Unaudited) 2023 2022 % Change Net Income $ 65,080 $ 104,422 Interest Expense 16,691 15,580 Income taxes 43,229 12,006 Depreciation and amortization expense 26,703 26,506 EBITDA 151,703 158,514 Non-recurring
Slide 18: Non-GAAP Reconciliations: Adjusted Diluted EPS
Non-GAAP Reconciliations Adjusted Diluted EPS (in thousands, except per share data) FOR THE THREE MONTHS ENDED AUGUST 31 FOR THE YEAR ENDED AUGUST 31 (Unaudited) 2023 2022 % Change 2023 2022 % Change GAAP Diluted Earnings per Common Share $ 1.68 $ 2.69 (37.5)% $ 12.03 $ 10.25 (17.4)% Deferred revenu
Slide 19: Non-GAAP Reconciliations: Free Cash Flow
Non-GAAP Reconciliations Free Cash Flow (in thousands) FOR THE THREE MONTHS ENDED AUGUST 31 FOR THE YEAR ENDED AUGUST 31 (Unaudited) 2023 2022 % Change 2023 2022 % Change Net Cash Provided by Operating Activities $ 175,911 $ 147,212 $ 645,573 $ 524,537 Capital Expenditures $ (19,606) $ (11,065) $ (6
Slide 20: Non-GAAP Reconciliations: Business Outlook Operating Margin, Net Income
Non-GAAP Reconciliations Business Outlook Operating Margin, Net Income (in millions, except per share data) Fiscal 2024 (Forward Looking) Low End of Range High End of Range Revenues $2,210 $2,230 Operating Income $ 732 $747 Operating Margin 33.1% 33.5% Intangible Asset Amortization 70 71 Adjusted Op
Slide 21: Non-GAAP Reconciliations: Business Outlook Adjusted Diluted EPS
Non-GAAP Reconciliations Business Outlook Adjusted Diluted EPS (in thousands, except per share data) ($ in thousands) Low-end of range High-end of range Diluted earnings per common share $14.20 $14.70 Intangible asset amortization 1.54 1.53 Discrete tax items (0.09) (0.08) Adjusted diluted earnings