Broadridge Financial Solutions, Inc. · NYSE:BR
Broadridge Financial Solutions — Q3 FY2022 Earnings Presentation
27 slides from Broadridge Financial Solutions's earnings presentation, May 3, 2022
Slide 1: Scaling a Global Fintech Leader - Third Quarter Fiscal Year 2022 Earnings Conference Call
0© 2022 | Scaling a Global Fintech Leader E A R N I N G S C O N F E R E N C E C A L L Third Quarter Fiscal Year 2022 EXHIBIT 99.2
Slide 2: Forward-Looking Statements
1© 2022 | Forward-Looking Statements This presentation 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 the meaning of the Private Securities Litigati
Slide 3: Use of Non-GAAP financial measures, KPIs and foreign exchange rates
2© 2022 | Use of Non-GAAP financial measures, KPIs and foreign exchange rates Use of Non-GAAP Financial Measures This presentation includes certain Non-GAAP financial measures including Adjusted Operating income, Adjusted Operating income margin, Adjusted Net earnings, Adjusted earnings per share (“
Slide 4: Key messages
3© 2022 | Key messages Broadridge delivered strong third quarter results, including 16% recurring revenue growth, double-digit Adjusted EPS growth, and strong sales 1 2 3 4 5 Our growth continues to be powered by long-term trends and the continued successful integration of Itiviti The value of the s
Slide 5: Broadridge is executing across Governance, Capital Markets, and Wealth & Investment Management
4© 2022 | Broadridge is executing across Governance, Capital Markets, and Wealth & Investment Management Extend Governance Grow Capital Markets Build Wealth & Investment Mgmt. $630M +9% YoY $247M +56% YoY $134M (2)% YoY 1. Excludes event and distribution revenue 1 Q3’22 Highlights • 17% equity recor
Slide 6: The importance of corporate governance continues to grow
5© 2022 | The importance of corporate governance continues to grow Technology is driving increased participation and diversification for retail investors New technologies are lowering the cost of investing and bringing in new investors. ✓ ETFs ✓ Managed Accounts ✓ Zero commission trading ✓ Enhanced
Slide 7: Broadridge continues to deliver strong and sustainable results
6© 2022 | Broadridge continues to deliver strong and sustainable results Third quarter results highlight continued execution against our long- term growth plan and the investments we have made in our business Continued strong performance in the face of increased macro volatility highlights the stren
Slide 8: Summary financial results
7© 2022 | Summary financial results $ in millions, except per share data THIRD QUARTER SUMMARY FINANCIAL RESULTS 2022 2021 Inc./(Dec.) Recurring revenues $1,012 $873 16% Total revenues 1,534 1,390 10% Operating income 246 239 3% Adjusted Operating income (Non-GAAP) 313 284 10% Adjusted Operating inc
Slide 9: Recurring revenue increased 16% in third quarter 2022
8© 2022 | FY'19 FY'20 FY'21 FY'22 $873 $1,012 Q3'21 Q3'22 Recurring revenue increased 16% in third quarter 2022 RECURRING REVENUE GROWTH 10%10% $ in millions Guidance High end of 12 - 15% 6% +16%
Slide 10: Third quarter 2022 segment recurring revenues
9© 2022 | $137 $134 $159 $247 Q3'21 Q3'22 $162 $172 $44 $46 $86 $285 $322 Q3'21 Q3'22 Regulatory Customer Comms. Data-Driven Fund Solutions Issuer $ in millions + 5% + 6% + 6% +13% ICS RECURRING REVENUES GTO RECURRING REVENUES Third quarter 2022 segment Recurring revenues $630 $577 Capital Markets W
Slide 11: Key volume drivers: position and trade volume growth
10© 2022 | INTERNAL TRADE GROWTH (ITG) 20% 33% 39% 20% 17% 7% 11% 9% 12% 10% Q3'21 Q4'21 Q1'22 Q2'22 Q3'22 Equity MF/ETF EQUITY & MUTUAL FUND/ETF POSITION GROWTH Key volume drivers: position and trade volume growth 12% (1)% 2% 1% (6)% FY’20 FY’21 26% 10% 10% 2% ITG 12%9% 1. SRG Q3’21 positions repre
Slide 12: Third quarter 2022 recurring revenue growth drivers
11© 2022 | GTO $296M 4 pts (2) pts (1) pt 27 pts $381M ICS $577M 5 pts (2) pts 6 pts 0 pts $630M Third quarter 2022 Recurring revenue growth drivers THIRD QUARTER 2022 RECURRING REVENUES GREW 16% TO $1.0B $ in millions Pts contribution to growth $873 $1,012 Q3'21 Recurring Revenue Closed Sales Clien
Slide 13: Third quarter 2022 total revenue growth drivers
12© 2022 | $73 $72 $76 $65 $59 Q3'21 Q4'21 Q1'22 Q2'22 Q3'22 $1,390 $1,534 Q3'21 Total Revenue Recurring Event-Driven Distribution FX Q3'22 Total Revenue Third quarter 2022 Total revenue growth drivers QUARTERLY EVENT-DRIVEN REVENUE +10 pts (1) pt +2 pts (0) pts 10% THIRD QUARTER 2022 TOTAL REVENUE
Slide 14: Operating income margin and Adjusted Operating income margin
13© 2022 | 17.1% 17.5% 18.1% FY'19 FY'20 FY'21 FY'22 15.0% 13.8% 13.6% 16.0%17.2% 20.4% 20.4% Q3'21 Q3'22 +120 bps +40 bps +60 bps OPERATING INCOME MARGIN (GAAP) ADJUSTED OPERATING INCOME MARGIN (NON- GAAP) ~18.5% Guidance Operating income margin and Adjusted Operating income margin OPERATING INCOME
Slide 15: Closed sales remain on track with fiscal year 2022 guidance
14© 2022 | $119 $170 YTD'21 YTD'22FY'20 FY'21 FY'22 $228 $232 Guidance Closed sales remain on track with fiscal year 2022 guidance $ in millions $240 – $280M CLOSED SALES
Slide 16: Capital allocation
15© 2022 | TOTAL CAPITAL RETURNS 4 YTD'21 YTD'22 $1.94 $2.16 $2.30 33% 11% 6% DIVIDENDS PER SHARE M&A Client Platform Investments CapEx and Software Capital allocation 2 1. Includes Software purchases and capitalized internal use software. 2. Net investments on new client conversions, including deve
Slide 17: Fiscal Year 2022 Guidance
16© 2022 | Fiscal Year 2022 Guidance FY’22 Guidance Updates / Change Recurring revenue growth High end of 12-15% No change Adjusted Operating income margin (Non-GAAP) ~18.5% No change Adjusted earnings per share growth (Non-GAAP) 13-15% Increasing from 11-15% Closed sales $240-$280M No change
Slide 18: Appendix
Appendix oe es Broadridge:
Slide 19: Supplemental Reporting Detail - Product Line Reporting (Unaudited)
18© 2022 | Confidential and Proprietary | Supplemental Reporting Detail ‒ Product Line Reporting (Unaudited) In the second quarter of fiscal year 2021, the Company changed its presentation of disaggregated revenue by product line disclosures to reflect internal realignment of the Company’s revenue r
Slide 20: Explanation of Non-GAAP measures and Reconciliation of GAAP to Non-GAAP measures
19© 2022 | Explanation of Non-GAAP measures and Reconciliation of GAAP to Non-GAAP measures
Slide 21: Non-GAAP measures Explanation and Reconciliation
20© 2022 | Non-GAAP measures Explanation and Reconciliation of the Company’s Use of Non-GAAP Financial Measures The Company’s results in this presentation are presented in accordance with U.S. generally accepted accounting principles ("GAAP") except where otherwise noted. In certain circumstances, r
Slide 22: Non-GAAP measures
21© 2022 | Non-GAAP measures We exclude Acquisition and Integration Costs, IBM Private Cloud Charges, Real Estate Realignment and Covid-19 Related Expenses, Investment Gains, the Software Charge and the Loss of Acquisition-Related Financial Instrument from our Adjusted Operating income (as applicabl
Slide 23: Reconciliation of GAAP to Non-GAAP Measures (Unaudited)
22© 2022 | Confidential and Proprietary | Reconciliation of GAAP to Non-GAAP Measures (Unaudited) 3 Months Ended Mar. 31 9 Months Ended Mar. 31 Dollars in millions 2022 2021 2022 2021 Operating income (GAAP) $246.0 $239.2 $418.2 $397.3 Adjustments: Amortization of Acquired Intangibles and Purchased
Slide 24: Reconciliation of GAAP to Non-GAAP Measures (Unaudited)
23© 2022 | Confidential and Proprietary | Reconciliation of GAAP to Non-GAAP Measures (Unaudited) (a) Real Estate Realignment Expenses impacted Adjusted earnings per share by $0.01 and $0.01 for the three months ended March 31, 2022 and 2021, respectively, and less than $0.01 and $0.28 for the nine
Slide 25: Reconciliation of GAAP to Non-GAAP Measures (Unaudited)
24© 2022 | Confidential and Proprietary | Reconciliation of GAAP to Non-GAAP Measures (Unaudited) (a) Real Estate Realignment Expenses were $29.6 million for the year ended June 30, 2021. Covid-19 Related Expenses were $15.7 million and $2.4 million for the year ended June 30, 2021 and 2020, respect
Slide 26: Fiscal Year 2022 Adjusted Earnings Per Share Growth Rate
25© 2022 | Confidential and Proprietary | Fiscal Year, 2022 Adjusted Earnings Per Share Growth Rate (a) Diluted earnings per share – GAAP (2) – 2% growth Adjusted earnings per share – Non-GAAP 13-15% growth Adjusted Operating Income Margin (b) Operating income margin % - GAAP ~13.5% Adjusted Operati
Slide 27: Contacts
26© 2022 | Contacts W. Edings Thibault Edings.Thibault@Broadridge.com Sean Silva Sean.Silva@Broadridge.com Replay Options Online replay available at broadridge-ir.com Telephone replay available through May 10, 2022 Domestic Dial-In: 1-877-344-7529 Access Code: 3051064 International Toll Dial-In: 1-4
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