Exhibit 99.1
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INVESTOR PRESENTATION FISCAL FOURTH QUARTER 2019
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Forward-Looking Statements * © 2019 | 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 Litigation Reform Act of 1995. Statements that are nothistorical in nature, and which may be identified by the use of words such as “expects,” “assumes,” “projects,” “anticipates,” “estimates,” “we believe,” “could be” and other words of similar meaning, are forward-looking statements. In particular, information appearing in the “Fiscal Year 2019 Guidance” section are forward-looking statements.These statements are based on management’s expectations and assumptions and are subject to risks and uncertainties that may cause actual results to differ materially from those expressed. These risks and uncertainties include those risk factors discussed in Part I, “Item 1A. Risk Factors” of our Annual Report on Form 10-K for the fiscal year ended June 30, 2018 (the “2018 Annual Report”), as they may be updated in any future reports filed with the Securities and Exchange Commission. All forward-looking statements speak only as of the date of this presentation and are expressly qualified in their entirety by reference to the factors discussed in the 2018 Annual Report.These risks include: the success of Broadridge in retaining and selling additional services to its existing clients and in obtaining new clients; Broadridge’s reliance on a relatively small number of clients, the continued financial health of those clients, and the continued use by such clients of Broadridge’s services with favorable pricing terms; a material security breach or cybersecurity attack affecting the information of Broadridge's clients; changes in laws and regulations affecting Broadridge’s clients or the services provided by Broadridge; declines in participation and activity in the securities markets; the failure of Broadridge's key service providers to provide the anticipated levels of service; a disaster or other significant slowdown or failure of Broadridge’s systems or error in the performance of Broadridge’s services; overall market and economic conditions and their impact on the securities markets; Broadridge’s failure to keep pace with changes in technology and demands of its clients; Broadridge’s ability to attract and retain key personnel; the impact of new acquisitions and divestitures; and competitive conditions. Broadridge disclaims any obligation to update or revise forward-looking statements that may be made to reflect events or circumstances that arise after the date made or to reflect the occurrence of unanticipated events, other than as required by law.Use of Material Contained HereinThe information contained in this presentation is being provided for your convenience and information only. This information is accurate as of the date of its initial presentation. If you plan to use this information for any purpose, verification of its continued accuracy is your responsibility. Broadridge assumes no duty to update or revise the information contained in this presentation.ASC 606 Revenue Accounting ChangeEffective July 1, 2018, Broadridge adopted Accounting Standards Update No. 2014-09 “Revenue from Contracts with Customers” and its related amendments (the “ASC 606 revenue accounting change”) using the modified retrospective transition approach. Under this transition approach, results for reporting periods beginning after July 1, 2018 reflect the ASC 606 revenue accounting change while prior period amounts have not been adjusted and continue to be reported in accordance with historical accounting guidelines. Where noted however, discussions of certain revenue metrics are presented assuming that the ASC 606 revenue accounting change had been applied to fiscal year 2018 revenues. Please refer to the pages 25 and 26 for a full presentation of reported fiscal year 2018 revenues giving effect to the ASC 606 revenue accounting change and page 33 for a reconciliation of reported fiscal year 2018 GAAP Total revenues to non-GAAP ASC 606 Total revenues.
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Use of Non-GAAP Financial Measures * © 2019 | Explanation and Reconciliation of the Company’s Use of Non-GAAP Financial MeasuresThe 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, results have been presented that are not generally accepted accounting principles measures (“Non-GAAP”). These Non-GAAP measures are Adjusted Operating income, Adjusted Operating income margin, Adjusted Net earnings, Adjusted earnings per share, and Free cash flow. These Non-GAAP financial measures should be viewed in addition to, and not as a substitute for, the Company’s reported results.The Company believes our Non-GAAP financial measures help investors understand how management plans, measures and evaluates the Company’s business performance. Management believes that Non-GAAP measures provide consistency in its financial reporting and facilitates investors’ understanding of the Company’s operating results and trends by providing an additional basis for comparison. Management uses these Non-GAAP financial measures to, among other things, evaluate our ongoing operations, for internal planning and forecasting purposes and in the calculation of performance-based compensation. In addition, and as a consequence of the importance of these Non-GAAP financial measures in managing our business, the Company’s Compensation Committee of the Board of Directors incorporates Non-GAAP financial measures in the evaluation process for determining management compensation.Adjusted Operating Income, Adjusted Operating Income Margin, Adjusted Net Earnings and Adjusted Earnings Per Share These Non-GAAP measures reflect Operating income, Operating income margin, Net earnings, and Diluted earnings per share, as adjusted to exclude the impact of certain costs, expenses, gains and losses and other specified items that management believes are not indicative of our ongoing operatingperformance. These adjusted measures exclude the impact of: (i) Amortization of Acquired Intangibles and Purchased Intellectual Property, (ii) Acquisition and Integration Costs, (iii) U.S. Tax Cuts and Jobs Act (the "Tax Act") items, and (iv) the Gain on Sale of Securities. Amortization of Acquired Intangibles and Purchased Intellectual Property represents non-cash amortization expenses associated with the Company's acquisition activities. Acquisition and Integration Costs represent certain transaction and integration costs associated with the Company’s acquisition activities. Tax Act items represent the net impact of a U.S. federal transition tax on earnings of certain foreign subsidiaries, foreign jurisdiction withholding taxes and certain benefits related to the remeasurement of the Company’s net U.S. federal and state deferred tax liabilities attributable to the Tax Act. The Gain on Sale of Securities represents a non-operating gain on the sale of securities associated with the Company's retirement plan obligations.We exclude Amortization of Acquired Intangibles and Purchased Intellectual Property, Acquisition and Integration Costs, Tax Act items, and the Gain on Sale of Securities from our earnings measures because excluding such information provides us with an understanding of the results from the primary operations of our business and these items do not reflect ordinary operations or earnings. Management believes these adjusted measures may be useful to an investor in evaluating the underlying operating performance of our business.Free Cash FlowIn addition to the Non-GAAP financial measures discussed above, we provide Free cash flow information because we consider Free cash flow to be a liquidity measure that provides useful information to management and investors about the amount of cash generated that could be used for dividends, share repurchases, strategic acquisitions, other investments, as well as debt servicing. Free cash flow is a Non-GAAP financial measure and is defined by the Company as Net cash flows provided by operating activities less Capital expenditures as well as Software purchases and capitalized internal use software.Reconciliations of such Non-GAAP measures to the most directly comparable financial measures presented in accordance with GAAP can be found in the tables that are part of this presentation.
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The Broadridge Story Strong market position across governance and capital markets and wealth management Platform-based business model creates unique value for our clients Significant growth opportunity supported by long-term trends of mutualization, digitization, and data & analytics Strong business model and long-term focus should sustain continued growth investment and shareholder returns Target Dividend Payout Ratio1 $2.6B FY18 Recurring FeeRevenue 5-7% Organic 3-Year Recurring Revenue Growth Objective 9-13% FY 2019 Adj. EPSGrowth Guidance~45% 24% Annualized 3 Yr. TSR(CY2016-2018) 1 Dividend payout ratio is a percentage of prior year Adjusted Net Earnings and is subject to Board Approval #1 Most Admired Financial Data Services Company by FORTUNE® magazine * © 2019 |
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The industry’s leading choice GOVERNANCE CAPITAL MARKETS WEALTH MANAGEMENT Process 80% of outstanding shares in the United States, 50%+ for rest of worldDistribute 90%+ of broker regulatory communications to 140M individual accountsServe most brokers, funds, and public companies in North AmericaReach 80% of North American households Clear and settle over $5T per dayServe 18 of 23 US primarydealers for fixed incomeProcess Equities for 7 of the top 10 global investment banksSupport clearance and settlement in over 80 countries Support 50M+ accounts through our technology platform25%+ of US FinancialAdvisors utilize Broadridge’s front office solutionsProvide data aggregation service for 228K+ agents and advisorsMaintain 100K retirement plans through Broadridge’s mutual fund settlements platform GROWING FRANCHISE1 GROWING FRANCHISE1 FRANCHISE1 OPPORTUNITY 1 At Broadridge we define Franchise as a business that having a truly differentiated value proposition and, more importantly, as one that creates network value * © 2019 |
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Broadridge platform-based business model creates unique value Networkvalue Deep financial servicesknowledge Multi-client managed services approach Domain expertiseTrusted * © 2019 | Unique CapabilityData & Analytics Scale leadershipSignificant IP
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Broadridge’s directly addressable market is $25-40B $9-13B * © 2019 | $6-12B $10-15B GOVERNANCE & COMMUNICATIONS WEALTH MANAGEMENT CAPITAL MARKETS 100% = $25-40B DATA & ANALYTICS DIGITIZATION MUTUALIZATION Large Growth Opportunity Key Market Trends
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Growth Opportunity: Extend Governance 140M+RETAIL SHAREHOLDER ACCOUNTS 150,000+ 27,000+MUTUAL FUNDS AND ETFs 1,100+BANKS and BROKER-DEALERS 5,000+ CORPORATE ISSUERS INSTITUTIONAL SHAREHOLDERS EXTEND GOVERNANCEFee Revenue = $1.7B BUILD WEALTH MANAGEMENT DRIVE CAPITAL MARKETS Driving Next-gen Regulatory Communications * © 2019 | Extend services to corporate Issuers Growing suite of data & analytics and digital solutions Building Omni- channel communications Note: Governance Fee revenues as of Broadridge’s December 2017 Investor Day and are primarily derived from Investor Communication Solutions (“ICS”) Segment
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Growth Opportunity: Drive Capital Markets Process for 18 of the 23 US Fixed Income primary dealersProcess Equities for 7 of the top 10 global investment banksClear and settle in over 80 markets globally Strong market position Support 30 clients for both technology and operations including 7 of 23 US Fixed Income primary dealers Unique managed services model Securities Financing & Collateral ManagementCorporate ActionsRegulatory Reporting Emerging capabilities Global marketmomentum EXTEND GOVERNANCE BUILD WEALTH MANAGEMENT DRIVE CAPITAL MARKETSFee Revenue = $0.5B Extend global post- trade technology platform 9 © 2019 | Add additional capabilities and new technologies Build network value Note: Capital Markets Fee revenues as of Broadridge’s December 2017 Investor Day and are primarily derived from Global Technology and Operations (“GTO”) Segment
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Growth Opportunity: Build Wealth Management Advisors Investors Wealth management toolsTargeted marketingWealth mobile portal Educational contentEnriched, digital communicationsTrading and account servicing Clearance & settlementClient and regulatory reportingBusiness processautomation & workflows EXTEND GOVERNANCE BUILD WEALTHFee Revenue $0.4B DRIVE CAPITAL MARKETS Drive winning targeted solutions Front-to-back global institutional platform of the future Next-generation digital and data processing capabilities Drive best-of- suite solutions for investment managers ICS GTO * © 2019 | Note: Wealth Management Fee revenues as of Broadridge’s December 2017 Investor Day and are derived across ICS and GTO Segments
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UBS Joining Broadridge Wealth Platform * © 2019 | Signing UBS as anchor client represents a major milestone in creating a Wealth Management franchiseBroadridge Wealth Platform will provide next-gen mission criticalinfrastructure to wealth managersBroadridge's platform will bring together capabilities across the front-, middle-, and back-office into a single platformOpen platform will enable connectivity to UBS and third partyapplicationsSelection of Broadridge is a powerful endorsement of Broadridge's ability to deliver enterprise-scale solutionsImportant step in building a long-term growth engine forBroadridge"Broadridge is the right partner and the only Fintech leader with the proven technology, scale and experience to deliver such a transformational solution"- Tom Naratil, Co-President, UBS Global Wealth Management
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Record Sales Building Revenue Backlog FY2014 - FY2019 YTD Closed Sales Recurring Revenue Backlog as of FY20182,3 FY19 Closed sales Guidance Range as of May 7th, 2019 Earnings CallRecurring Revenue Backlog as of August 7th, 2018 Earnings Call and are Broadridge estimates and subject to revision.Recurring Revenue Backlog represents an estimate of first year revenues from Closed sales that have not yet been recognized and are expected to be recognized. Not Yet Live represents the subset of the Backlog where none of the first year revenues from Closed sales have been recognized but are expected to be recognized. Live represents the subset of the Backlog where a portion of the first year revenues from Closed sales have been recognized in previous periods. $ in millions $215 $80 2018Not Yet Live Live Total~$295 $127 $146 $151 $215$188 $161 $50 $100 $150 $200 $250 Series1 Series3 FY14-18 CAGR = 14% FY14 FY15Closed Sales $200 $240 FY16 FY17 FY18 9M FY19FY19 Closed Sales Guidance Range1,2 * © 2019 |
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Broadridge business model is strong Sustainable Growth Large, recurring revenue base with good visibility aidedby $295 million revenue backlogOrganic strength driven by large addressable market Steady Margin Expansion Continued scale and operational leverageFocus on operational efficiencies Strong Free Cash Flow 100+% free cash flow conversionLargely predictable model Balanced Capital Allocation Target ~45% dividend payout ratio1Balance of targeted M&A and share repurchase * © 2019 | 1 Dividend payout ratio is a percentage of prior year Adjusted Net Earnings and is subject to Board Approval
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Driving next-gen regulatory communicationsStrengthening digital products to enhance regulatory and other communications30e-3 and EnhancedContent opportunitiesBlockchain proxy capability for North American marketGrowing data & analyticssuite Broadening corporate issuer solution set Building omni-channel communications Extending global post trade technology platformContinued progress onboarding major clientsNew client wins furtherextend international reach Developing new products to drive network value in fixed income market Successfully tested blockchain proof of concept for repo market UBS win represents a major milestone in creating a Wealth Management franchiseContinued strong interest from key clients in integrated Wealth platformContinuing to drive penetration of existing productsNew back office platform wins driving growth in U.S. and Canada Extend Governance Drive Capital Markets Build Wealth Management Executing Against Investor Day Themes * © 2019 |
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Organic Recurring Fee Revenue Growth 5-7% Recurring Fee Revenue Growth 7-9% Adjusted Op Income Margin Expansion ~50bps/yr Adjusted EPS Growth 14-18% Winning formula for top quartile TSR FY17 - FY20 three year growth objectives * © 2019 | Note: FY17 - FY20 three year Adjusted EPS growth objective updated February 8th, 2018 for change in U.S. Tax Law. Compound annual growth rates (CAGRs), except margin. Three Year objectives as of February 8th, 2018 Earnings Call.
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Regulatory Update June 2018SEC Approves 30e-3 “Notice-and-access” Allows mutual funds to opt-in their shareholders to receive “notice- and-access” beginning in 2021Working with 130+ fund familiesFinancial impact: higher recurring fee revenues, lower distribution revenues, modestly net positive impact on gross profit October 2018Comments on mutual fundinterim fees Potential review of approximately $150 million of BR fee revenueBR comment letter laid out strong track record of value ($400M+ annually) delivered. Additional future savings identified.Comments only – no timeframe for decision on fee review, if anyFee reviews generally have been lengthy processes October 2018 Comments on modernization of mutual fund communications November 2018Proxy Roundtable SEC asked for comments on how to modernize and improve the design, delivery and content of fund managementOpportunity for BR to showcase capabilities to enhance shareholder engagement while lowering costs through digital and technology capabilities SEC gathered various constituents to talk about all aspects of theproxy voting processSignificant interest in examining voter confirmation capabilitiesJoint letter submitted to SEC to make end-to-end vote confirmation a reality * © 2019 |
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Deliver on FY2019 guidance and FY2020 growth objectives DELIVER RESULTS Build on current capabilities like culture, product and technology BUILD ON CAPABILITIES Execute against Investor Day growth plans across Governance, Capital Markets and Wealth Management EXECUTE AGAINST STRATEGY Broadridge focused on capturing opportunity * © 2019 |
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Fiscal Year 2018 and Third Quarter 2019 Financial Summary as of May 7th 2019 Earnings Call: * © 2019 |
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Business Update * © 2019 | Solid financial resultsInvestor Communication Solutions ("ICS") Recurring fee revenues up 6% excluding the impact of the accounting change - including 14% growth, excluding Customer CommunicationsGlobal Technology and Operations ("GTO") revenues flat compared to very strong 3Q 2018. Return to mid-single digit growth expected in 4QClosed sales of $37 million in third quarter and record $161 million YTDContinued progress on key growth initiativesRoll out of new voting app highlights Broadridge's commitment to driving the next generation of regulatory communicationsEngaging with industry players to improve proxy voting processDriving 30e-3 implementation for fund industryStrong progress on bringing new clients onto Broadridge's industry platforms and healthy backlog underlies long-term growth outlookTuck-in M&A investments expected to broaden wealth managementoffering and add scale to mutual fund product suite
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Third Quarter 2019 Revenue Growth Drivers Third Quarter 2019 Total revenues grew 1% to $1.2 billion Third Quarter 2019 Recurring fee revenues grew 4% to $767 millionOrganic Growth: 3% $1,208M $1,225M 0 pt. (0) pt. (1) pt. +3 pts. +1% $736M +4%$767M +6 pts. * © 2019 | +1 pt. (0) pt. (2) pts. Notes:(1) Please refer to pages 25 and 26 for a full presentation of reported FY18 revenues giving effect to the ASC 606 revenue accounting change and GAAP to Non-GAAP reconciliation on page 33. (2) Amounts may not sum due to rounding.
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Fiscal Year 2018 Revenue Growth Drivers Fiscal Year 2018 Total revenues grew 5% to $4.3 billion $4,330M +4% +2% -1% 0% $ 4,143M $2,451M $2,610M +6% -3% +2% +1% +6% +5% Note: Amounts may not sum due to rounding Fiscal Year 2018 Recurring fee revenues grew 6% to $2.6 billionOrganic Growth: 5% * © 2019 |
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Third Quarter 2019 GAAP and Adjusted Operating Income and EPS Dollars in millions, except per share amounts Year-over-Year Change in Operating Income and Adjusted Operating Income Year-over-Year Change in EPS and Adjusted EPS +68% * © 2019 | +79% +59%+61%
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Fiscal Year 2018 GAAP and Adjusted Operating Income and Adjusted EPS $ in millions, except per share amounts Year-over-Year Change in Operating Income and Adjusted Operating Income Year-over-Year Change in EPS and Adjusted EPS +10% * © 2019 | +12% +34%+32%
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Fiscal Year 2019 Guidance - Updated * © 2019 | Prior1 Current2 Recurring fee revenue growth 5 - 7% 5 - 7% Expected to be in lower half of range Total revenue growth 3 - 5% ~1% �� Operating income margin - GAAP ~14.5% ~15.0% Adjusted Operating incomemargin - Non-GAAP ~16.5% ~17.0% Diluted earnings per sharegrowth3 12 - 16% 12 - 16% Adjusted earnings per share growth3 - Non-GAAP 9 - 13% 9 - 13% Expected to be in middle of range Free cash flow3 - Non-GAAP $565 - $615M $565 - $615M Expected to be at low end of range Closed sales $185 - $225M $200 - $240M Prior guidance as of February 7, 2019.Current Guidance as of May 7, 2019.Current fiscal year 2019 guidance includes $20 million of excess tax benefits related to stock-based compensation, reduced from $25 million assumed in Prior fiscal year 2019 guidance and down from $41 million in fiscal year 2018.
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FY2018 Total Revenues: Impact of ASC 6062018 Dollars in millions Q1 Q2 Q3 Q4 FY Revenues As Reported Recurring Fee Revenues $ 547.8 $ 562.4 $ 638.6 $ 861.5 $ 2,610.4 Event-Driven Fee Revenues 59.3 97.3 66.5 60.7 283.9 Distribution Revenues 334.2 370.4 385.4 422.9 1,512.9 FX (16.5 ) (17.4 ) (18.6 ) (24.8 ) (77.3 ) Total Revenues $ 924.8 $ 1,012.8 $ 1,071.9 $ 1,320.4 $ 4,329.9 Revenue Adjustments from ASC 606 Revenue Accounting Change Recurring Fee Revenues $ (3.3 ) $ 3.5 $ 97.8 $ (97.5 ) $ 0.4 Event-Driven Fee Revenues 43.9 (47.3 ) 2.1 (1.0 ) (2.2 ) Distribution Revenues 18.5 (21.4 ) 36.4 (24.0 ) 9.6 FX — — — — — Total Revenues $ 59.1 $ (65.2 ) $ 136.3 $ (122.5 ) $ 7.7 ASC 606 Revenues Recurring Fee Revenues $ 544.5 $ 565.9 $ 736.4 $ 764.0 $ 2,610.8 Event-Driven Fee Revenues 103.2 50.0 68.6 59.7 281.6 Distribution Revenues 352.8 349.0 421.8 399.0 1,522.5 FX (16.5 ) (17.4 ) (18.6 ) (24.8 ) (77.3 ) Total Revenues $ 983.9 $ 947.6 $ 1,208.2 $ 1,197.9 $ 4,337.6 * © 2019 | Note:Please refer to the GAAP to Non-GAAP reconciliation on page 33 for impact of the ASC 606 revenue accounting change on FY2018 Total revenues.Amounts may not sum due to rounding.
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FY 2018 Segment Recurring Fee Revenues: Impact of ASC 606 Note: Amounts may not sum due to rounding * © 2019 | 2018 Dollars in millions Q1 Q2 Q3 Q4 FY Recurring Fee Revenues As Reported ICS $ 332.9 $ 334.4 $ 403.5 $ 628.0 $ 1,698.9 GTO 214.9 228.0 235.2 233.5 911.6 Total Recurring Fee Revenues $ 547.8 $ 562.4 $ 638.6 $ 861.5 $ 2,610.4 % of FY Recurring Fee Revenue 21.0 % 21.5 % 24.5 % 33.0 % 100.0 % Recurring Fee Revenue Adjustments from ASC 606 Revenue Accounting Change ICS $ (1.1 ) $ 3.1 $ 96.9 $ (97.7 ) $ 1.3 GTO (2.3 ) 0.4 0.8 0.2 (0.9 ) Total Recurring Fee Revenues $ (3.3 ) $ 3.5 $ 97.8 $ (97.5 ) $ 0.4 ASC 606 Recurring Fee Revenues ICS $ 331.8 $ 337.5 $ 500.4 $ 530.4 $ 1,700.1 GTO 212.6 228.4 236.0 233.7 910.7 Total Recurring Fee Revenues $ 544.5 $ 565.9 $ 736.4 $ 764.0 $ 2,610.8 % of FY Recurring Fee Revenue 20.9 % 21.7 % 28.2 % 29.3 % 100.0 %
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Supplemental Reporting Detail - Product Line Reporting Q1FY18 Q2FY18 Q3FY18 Q4FY18 Note: Amounts may not sum due to rounding * © 2019 | FY 2018 Q1FY19 Q2 FY19 Dollars in millions Q3 FY19 YTD FY19 $ $ 30.049.2181.572.2 $ 33.6 $ 45.1 $ 298.146.9 67.0 58.3187.3 210.7 180.666.5 80.7 91.1 $ 406.8221.4760.1310.6 31.0 $ 57.8 174.9 83.8 41.7 $ 152.9 $60.7 82.1182.6 201.182.1 94.4 225.6200.6558.6260.3 Investor Communication Solutions ("ICS")Equity proxyMutual fund and ETF interimsCustomer communications and fulfillment Other ICSTotal ICS recurring fee revenues $ 332.9 $ 334.4 $ 403.5 $ 628.0 $ 1,698.9 $ 347.4 $ 367.2 $ 530.5 $ 1,245.1 $ 30.8 $ 28.8 $ 39.9 $ 34.9 28.5 68.6 26.6 25.8 Equity and other Mutual fundsTotal Event-driven fee revenues $ 59.3 $ 97.3 $ 66.5 $ 60.7 $ 134.4 149.4 $ 283.9 $ 79.0 114.5 $ 193.5 DistributionTotal ICS revenues 334.2 370.4 385.4 422.9 $ 726.4 $ 802.2 $ 855.3 $ 1,111.7 1,512.9 $ 3,495.6 $ 24.1 $ 19.5 $ 35.4 52.8 28.6 33.1 $ 76.9 $ 48.1 $ 68.4 341.4 322.9 418.2 $ 765.8 $ 738.1 $ 1,017.1 1,082.5 $ 2,521.0 $ 179.0 $ 189.4 $ 195.9 $ 193.0 35.9 38.5 39.3 40.5 Global Technology and Operations ("GTO")Equities and other Fixed incomeTotal GTO recurring fee revenues $ 214.9 $ 228.0 $ 235.2 $ 233.5 $ 757.2 154.3 $ 911.6 $ 579.7 121.2 $ 700.9 (16.5) (17.4) (18.6) (24.8) Foreign currency exchangeTotal revenues $ 924.8 $ 1,012.8 $ 1,071.9 $ 1,320.4 (77.3)$ 4,329.9 $ 187.7 $ 196.5 $ 195.5 40.0 40.1 41.1 $ 227.7 $ 236.6 $ 236.6 (20.7) (21.4) (28.9)$ 972.8 $ 953.4 $ 1,224.8 (70.9)$ 3,151.0 Revenues by Type $ 547.859.3334.2 $ 562.4 $ 638.6 $ 861.597.3 66.5 60.7370.4 385.4 422.9 $ 575.2 $ 603.8 $ 767.076.9 48.1 68.4341.4 322.9 418.2 Recurring fee revenues Event-driven fee revenues Distribution revenues Foreign currency exchange Total revenues (16.5) (17.4) (18.6) (24.8)$ 924.8 $ 1,012.8 $ 1,071.9 $ 1,320.4 $ 2,610.4283.91,512.9 (77.3)$ 4,329.9 (20.7) (21.4) (28.9) $ 972.8 $ 953.4 $ 1,224.8 $ 1,946.0193.51,082.5 (70.9)$ 3,151.0
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Appendix * © 2019 |
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Tax Act and Excess Tax Benefit ("ETB") Impact 3Q 9M Fiscal Year Dollars in millions 2018 2019 2018 2019 2018 2019Outlook Earnings before income taxes $125.2 $223.6 $303.0 $377.2 $561.0 Provision for income taxes (excluding ETB and non-recurring gains and charges) $31.8 $52.8 $84.4 $87.6 $158.6 Net Tax Charges — — 16.1 — 15.4 — ETB (15.6) (1.3) (18.6) (9.2) (40.9) ~(20) Provision for income taxes (GAAP) $16.2 $51.4 $81.9 $78.4 $133.1 Tax Rates Tax Rate (excluding ETB and non-recurring gains and charges) 25.4% 23.6% 27.9% 23.2% 28.3% ~24% Tax Rate (GAAP) 12.9% 23.0% 27.0% 20.8% 23.7% ~20% EPS Growth (a) Diluted EPS 43% 61% 60% 36% 32% Adjusted EPS 45% 59% 63% 26% 34% Adjusted EPS (excluding ETB) 28% 80% 52% 32% 23% * © 2019 | (a) Please refer to page 32 for the GAAP to Non-GAAP reconciliation. Note: Amounts may not sum due to rounding
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GAAP Reconciliations * © 2019 |
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Dollars in millions Three Months Ended March 31, Nine Months Ended March 31, 2019 2018 2019 2018 Operating income (GAAP) $ 233.6 $ 130.8 $ 411.9 $ 331.9 Adjustments: Amortization of Acquired Intangibles and Purchased IntellectualProperty 21.2 20.2 64.3 59.4 Acquisition and Integration Costs 0.9 1.3 3.1 6.0 Adjusted Operating income (Non-GAAP) $ 255.7 $ 152.3 $ 479.4 $ 397.2 Operating income margin (GAAP) 19.1 % 12.2 % 13.1 % 11.0 % Adjusted Operating income margin (Non-GAAP) 20.9 % 14.2 % 15.2 % 13.2 % * © 2019 | Three Months Ended March 31, Nine Months Ended March 31, 2019 2018 2019 2018 Net earnings (GAAP) $ 172.2 $ 109.1 $ 298.8 $ 221.1 Adjustments: Amortization of Acquired Intangibles and Purchased Intellectual Property 21.2 20.2 64.3 59.4 Acquisition and Integration Costs 0.9 1.3 3.1 6.0 Gain on Sale of Securities — (5.5 ) — (5.5 Taxable adjustments 22.1 16.1 67.5 59.9 Tax Act items — — — 16.1 Tax impact of adjustments (a) (5.4 ) (3.7 ) (15.7 ) (16.7 Adjusted Net earnings (Non-GAAP) $ 188.9 $ 121.4 $ 350.6 $ 280.4 ))(a) Calculated using the GAAP effective tax rate, adjusted to exclude $1.3 million and $9.2 million of excess tax benefits associated with stock-based compensation for the three and nine months ended March 31, 2019, and $15.6 million and $18.6 million of excess tax benefits associated with stock-based compensation, for the three and nine months ended March 31, 2018, as well as the net $16.1 million charges associated with the Tax Act for the nine months ended March 31, 2018. For purposes of calculating the Adjusted earnings per share, the same adjustments were made on a per share basis.Note: Amounts may not sum due to rounding Reconciliation of GAAP to Non-GAAP Measures(Unaudited)
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)) * © 2019 | Dollars in millions, except per share amounts Three Months Ended March 31, Nine Months Ended March 31, 2019 2018 2019 2018 Diluted earnings per share (GAAP) $ 1.45 $ 0.90 $ 2.51 $ 1.84 Adjustments: Amortization of Acquired Intangibles and Purchased Intellectual Property 0.18 0.17 0.54 0.49 Acquisition and Integration Costs 0.01 0.01 0.03 0.05 Gain on Sale of Securities — (0.05 ) — (0.05 Taxable adjustments 0.19 0.13 0.57 0.50 Tax Act items — — — 0.13 Tax impact of adjustments (a) ( 0.05 ) (0.03 ) (0.13 ) (0.14 Adjusted earnings per share (Non-GAAP) $ 1.59 $ 1.00 $ 2.94 $ 2.33 ) Nine Months Ended March 31, 2019 2018 Net cash flows provided by operating activities (GAAP) $ 217.9 $ 274.8 Capital expenditures and Software purchases and capitalized internal use software (46.3 ) (70.6 Free cash flow (Non-GAAP) $ 171.6 $ 204.2 (a) Calculated using the GAAP effective tax rate, adjusted to exclude $1.3 million and $9.2 million of excess tax benefits associated with stock-based compensation for the three and nine months ended March 31, 2019, and $15.6 million and $18.6 million of excess tax benefits associated with stock-based compensation, for the three and nine months ended March 31, 2018, as well as the net $16.1 million charges associated with the Tax Act for the nine months ended March 31, 2018. For purposes of calculating the Adjusted earnings per share, the same adjustments were made on a per share basis.Note: Amounts may not sum due to rounding Reconciliation of GAAP to Non-GAAP Measures(Unaudited)
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Reconciliation of GAAP to Non-GAAP Measures(Unaudited) * © 2019 | Three Months Ended Nine Months Ended Fiscal Year Dollars in millions Sept. 30, 2017 Dec. 31, 2017 March 31, 2018 June 30 , 2018 March 31, 2018 2018 Total Revenues $ 924.8 $ 1,012.8 $ 1,071.9 $ 1,320.4 $ 3,009.5 $ 4,329.9 ASC 606 Accounting Impact (a) 59.1 (65.2 ) 136.3 (122.5 ) 130.2 7.7 ASC 606 Total Revenues (a) $ 983.9 $ 947.6 $ 1,208.2 $ 1,197.9 $ 3,139.7 $ 4,337.6 (a) Reflects the impact of the ASC 606 revenue accounting change on fiscal year 2018 reported Total revenues.Note: Amounts may not sum due to rounding
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Dollars in millions, except per share amounts FY19 Adjusted Earnings Per Share Growth Rate (1) Diluted earnings per share (GAAP) 12% - 16% Adjusted earnings per share (Non-GAAP) 9% - 13% FY19 Adjusted Operating Income Margin (2) Operating income margin % (GAAP) ~15.0% Adjusted Operating income margin % (Non-GAAP) ~17.0% Free Cash Flow Net cash flows provided by operating activities (GAAP) $660 - $730 million Capital expenditures and Software purchases and capitalized internal use software (95) - (115) million Free cash flow (Non-GAAP) $565 - $615 million * © 2019 | Adjusted earnings per share growth (Non-GAAP) is adjusted to exclude the projected impact of Amortization of Acquired Intangibles and Purchased Intellectual Property, and Acquisition and Integration Costs, and is calculated using diluted shares outstanding. Fiscal year 2019 Non- GAAP Adjusted earnings per share guidance estimates exclude Amortization of Acquired Intangibles and Purchased Intellectual Property, and Acquisition and Integration Costs, net of taxes, of approximately $0.60 per share.Adjusted Operating income margin (Non-GAAP) is adjusted to exclude the projected impact of Amortization of Acquired Intangibles and Purchased Intellectual Property, and Acquisition and Integration Costs. Fiscal year 2019 Non-GAAP Adjusted Operating income margin guidance estimates exclude Amortization of Acquired Intangibles and Purchased Intellectual Property, and Acquisition and Integration Costs of approximately $94 million. Reconciliation of GAAP to Non-GAAP Measures - Third Quarter and FY19 Guidance (Unaudited)
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Broadridge Investor Relations * © 2019 | W. Edings ThibaultInvestor RelationsTel: 516-472-5129Email: edings.thibault@broadridge.com