Broadridge Financial Solutions, Inc. (NYSE:BR) today reported
financial results for the first quarter ended September 30,
2016 of its fiscal year 2017.
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First Quarter |
% |
Summary Financial Results |
|
|
2017 |
|
|
2016 |
|
Change |
Dollars in
millions, except per share data |
|
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|
|
|
|
|
|
|
Total
revenues |
|
$ |
895 |
|
|
$ |
595 |
|
|
|
51 |
% |
Recurring
fee revenues |
|
|
517 |
|
|
|
393 |
|
|
|
32 |
% |
|
|
|
|
|
|
Operating
income |
|
|
66 |
|
|
|
59 |
|
|
|
12 |
% |
|
Operating income margin |
|
|
7.4 |
% |
|
|
9.9 |
% |
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|
|
Adjusted
operating income - Non-GAAP |
|
|
82 |
|
|
|
68 |
|
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|
19 |
% |
|
Adjusted operating income margin -
Non-GAAP |
|
|
9.1 |
% |
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|
11.5 |
% |
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|
|
|
|
|
Diluted
EPS |
|
$ |
0.28 |
|
|
$ |
0.28 |
|
|
|
— |
% |
Adjusted
EPS - Non-GAAP |
|
$ |
0.36 |
|
|
$ |
0.33 |
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9 |
% |
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Closed
sales |
|
$ |
22 |
|
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$ |
17 |
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26 |
% |
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“Broadridge delivered a solid first quarter,” said
Richard J. Daly, Broadridge’s President and Chief Executive
Officer. “We reported strong revenue growth, largely driven by the
acquisition of NACC, and continued strong momentum in Closed sales.
We also took steps to strengthen our leadership position over the
medium- and long-term by investing in blockchain technology for our
proxy business and by executing on the digital strategy for our
Investor Communication Solutions segment.”
“These efforts, together with other ongoing product
initiatives and our strong sales pipeline, give Broadridge multiple
paths to drive growth. We are on track to achieve our three
year financial objectives and our fiscal 2017 guidance for
recurring fee revenue growth of 29% to 31%, Adjusted EPS growth of
12% to 17%, and Closed sales in the range of $140 million to $180
million,” Mr. Daly added.
Financial Results for First Quarter Fiscal
Year 2017
RevenuesRevenues for the first
quarter of fiscal year 2017 increased 51% to $895 million, from
$595 million for the prior year period. Revenues from acquisitions
contributed $278 million of this total increase, with the revenues
of the North American Customer Communications business acquired
from DST Systems, Inc. ("NACC") contributing $272
million.
Recurring fee revenues rose 32% to $517 million
from $393 million. The increase in recurring fee revenues
reflected: contributions from our recent acquisitions (28pts),
including $106 million from the acquisition of NACC, and gains from
Net New Business (4pts).
Distribution revenues rose $181 million, or 103%,
to $357 million, largely driven by the acquisition of NACC. Changes
in foreign currency rates lowered Broadridge's total revenue by $4
million as compared to the prior year period.
Operating IncomeFor the first
quarter of fiscal year 2017:
- Operating income was $66 million, an increase of $7 million, or
12%, compared to $59 million for the prior year period. Operating
income margin decreased to 7.4%, compared to 9.9% for the prior
year period.
- Adjusted operating income was $82 million, an increase of $13
million, or 19%, compared to $68 million for the prior year period.
Adjusted operating income margin decreased to 9.1%, compared to
11.5% for the prior year period.
- The increase in Operating income and Adjusted operating income
was primarily due to the acquisition of NACC.
Interest Expense and Other Non-operating
ExpensesInterest expense, net for the first quarter of
fiscal year 2017 was $10 million, an increase of $4 million, or
68%, compared to $6 million for the prior year period. The increase
was primarily due to higher interest expense driven by higher
indebtedness. Other non-operating expenses, net were $4 million, an
increase of $3 million, primarily due to higher foreign currency
transaction losses.
Net Earnings and Earnings per
ShareFor the first quarter of fiscal year 2017:
- Net earnings were $34 million for both the current and prior
year period.
- Adjusted net earnings increased 11% to $44 million, compared to
$40 million for the prior year period.
- Diluted earnings per share were $0.28, unchanged from the prior
year period.
- Adjusted earnings per share increased 9% to $0.36 from $0.33
for the prior year period
Segment and Other Results for First Quarter
Fiscal Year 2017
Investor Communication Solutions ("ICS")ICS
revenues in the first quarter of fiscal year 2017 increased $294
million, or 68%, to $723 million, compared to $430 million in the
prior year period. Revenues from acquisitions contributed $274
million of this total increase, with NACC revenues contributing
$272 million.
ICS recurring fee revenues in the first quarter of
fiscal year 2017 rose $113 million, or 52%, to $329 million.
The increase reflected: (i) contributions from our recent
acquisitions (50pts), including (49pts) from the NACC acquisition;
and (ii) Net New Business from increases in revenues from Closed
sales (3pts); which were partially offset by (iii) negative
internal growth as a result of a decline in the volume of processed
pieces (-1pt).
ICS distribution revenues rose $181 million, or
103%, to $357 million. Event-driven revenues declined $1
million to $38 million as a result of decreased equity proxy
specials and corporate actions communications activity.
Position growth compared to the same period in the
prior year, which is a component of internal growth, was 1% for
mutual fund interims and 1% for annual equity proxy
communications.
ICS earnings before income taxes declined $1
million, or 3%, to $33 million as higher operating expenses,
including higher distribution and amortization expenses, more than
offset the impact of higher revenues. Pre-tax margins
decreased by 3.4 percentage points to 4.5%, this was primarily due
to the acquisition of NACC.
Global Technology and Operations ("GTO")GTO
revenues in the first quarter of fiscal year 2017 increased $11
million, or 6%, to $188 million, compared to $177 million in the
prior year period. The increase was attributable to higher Net New
Business from Closed sales (4pts) and revenue from recent
acquisitions (2pts).
GTO earnings before income taxes rose $8 million,
or 26%, to $38 million, reflecting robust revenue growth and cost
management initiatives. Pre-tax margins increased by 320 basis
points to 20.4%.
OtherOther Pre-tax loss increased by $9 million, or
64%, in the first quarter of fiscal year 2017 to $23 million. The
biggest driver of the increased loss was higher net interest
expense of $4 million.
Additional First Quarter Fiscal Year 2017
Events Customer Communications AcquisitionOn July 1, 2016,
Broadridge completed the acquisition of NACC from DST Systems,
Inc., expanding our product offerings in our Investor Communication
Solutions segment. This business is being integrated into our
existing customer communications business, which is now known as
Broadridge Customer Communications. The aggregate purchase price
was $410 million in cash, subject to customary working capital and
other closing adjustments.
Purchase of Intellectual PropertyIn September 2016,
Broadridge acquired intellectual property assets from Inveshare,
Inc. ("Inveshare") and, at the same time, entered into a
development agreement with an affiliate of Inveshare to use these
assets to develop blockchain technology applications for
Broadridge’s proxy business. The purchase price was $95 million to
acquire the existing assets, plus an additional deferred payment of
$40 million upon delivery of the new blockchain technology
applications, which the Company expects to occur by September 2018.
Broadridge also granted Inveshare a perpetual license to the
acquired technology assets, and Inveshare will remain an
independent provider of proxy communication services.
Subsequent Event - M&O Systems
AcquisitionOn November 4, 2016, Broadridge completed the
acquisition of M&O Systems, Inc. (“M&O”). M&O is a
provider of SaaS-based compensation management and related
solutions for broker-dealers and registered investment advisors.
The aggregate purchase price was $25 million in cash, subject to
customary working capital and other closing adjustments.
Fiscal Year 2017 Financial
GuidanceThe Company reaffirms its fiscal year 2017
guidance:
- Recurring fee revenue growth in the range of 29% to 31%
- Total revenue growth in the range of 43% to 45%
- Adjusted operating income margin of ~15%
- Diluted earnings per share growth in the range of 9% to
14%
- Adjusted earnings per share growth in the range of 12% to
17%
- Free cash flow in the range of $350 million to $400
million
- Closed sales in the range of $140 million to $180 million
Earnings Conference CallAn analyst
conference call will be held today, Wednesday, November 9,
2016 at 8:30 a.m. ET. A live webcast of the call will be available
to the public on a listen-only basis. To listen to the live event
and access the slide presentation, visit Broadridge’s Investor
Relations website at www.broadridge-ir.com prior to the start
of the webcast. To listen to the call, investors may dial
1-844-348-2805 within the United States and international callers
may dial 1-213-785-7185.
A replay of the webcast will be available and can
be accessed in the same manner as the live webcast at the
Broadridge Investor Relations site. Through November 23, 2016, the
recording will also be available by dialing 1-855-859-2056
passcode: 8672496 within the United States or 1-404-537-3406
passcode: 8672496 for international callers.
Explanation and Reconciliation of the
Company’s Use of Non-GAAP Financial MeasuresThe Company’s
results in this press release are presented in accordance with U.S.
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 ShareThese 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
operating performance. These adjusted measures exclude the impact
of Amortization of Acquired Intangibles and Purchased Intellectual
Property, and Acquisition and Integration Costs. Amortization
of Acquired Intangibles and Purchased Intellectual Property
represents non-cash 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. We exclude Amortization of
Acquired Intangibles and Purchased Intellectual Property, and
Acquisition and Integration Costs from these 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 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 and other
discretionary investments. 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 and
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 press
release.
Forward-Looking StatementsThis
press release and other written or oral statements made from time
to time by representatives of Broadridge may contain
“forward-looking statements” within the meaning of the Private
Securities Litigation Reform Act of 1995. Statements that are not
historical 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 2017 Financial 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, 2016 (the “2016 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 press release and are expressly qualified in
their entirety by reference to the factors discussed in the 2016
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; changes in laws and
regulations affecting Broadridge’s clients or the services provided
by Broadridge; any material breach of Broadridge security affecting
its clients’ customer information; declines in participation and
activity in the securities markets; the failure of Broadridge’s
outsourced data center services provider 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.
About BroadridgeBroadridge
Financial Solutions, Inc. (NYSE:BR) is a leading provider of
investor communications and technology-driven solutions for banks,
broker-dealers, mutual funds and corporate issuers. Broadridge’s
investor and customer communications, securities processing and
managed services solutions help clients reduce their capital
investments in operations infrastructure, allowing them to increase
their focus on core business activities. With over 50 years of
experience, Broadridge’s infrastructure underpins proxy voting
services for over 90% of public companies and mutual funds in North
America, and processes on average over $5 trillion in equity and
fixed income trades per day. Broadridge employs approximately
10,000 associates in 16 countries. For more information about
Broadridge, please visit www.broadridge.com.
Broadridge Financial Solutions,
Inc. |
Condensed Consolidated Statements of
Earnings |
(In millions, except per share
amounts) |
(Unaudited) |
|
|
Three Months Ended September
30, |
|
2016 |
|
2015 |
Revenues |
$ |
895.3 |
|
$ |
594.7 |
|
Operating expenses: |
|
|
|
Cost of revenues |
717.9 |
|
438.6 |
|
Selling, general and administrative
expenses |
111.3 |
|
97.1 |
|
Total operating expenses |
829.3 |
|
535.7 |
|
|
|
|
|
Operating income |
66.0 |
|
59.1 |
|
Interest expense, net |
10.4 |
|
6.2 |
|
Other non-operating
expenses, net |
4.2 |
|
1.2 |
|
Earnings before income
taxes |
51.5 |
|
51.7 |
|
Provision for income
taxes |
17.9 |
|
18.1 |
|
Net earnings |
$ |
33.7 |
|
$ |
33.5 |
|
|
|
|
|
Basic earnings per
share |
$ |
0.28 |
|
$ |
0.28 |
|
Diluted earnings per
share |
$ |
0.28 |
|
$ |
0.28 |
|
|
|
|
|
|
|
|
Weighted-average shares
outstanding: |
|
|
|
Basic |
118.5 |
|
118.3 |
|
Diluted |
121.6 |
|
121.7 |
|
|
|
|
|
Dividends declared per
common share |
$ |
0.33 |
|
$ |
0.30 |
|
|
|
|
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|
Amounts may not sum due to
rounding. |
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Broadridge Financial Solutions,
Inc. |
Condensed Consolidated Balance
Sheets |
(In millions) |
(Unaudited) |
|
|
September 30, 2016 |
|
June 30, 2016 |
Assets |
|
|
|
Current assets: |
|
|
|
Cash and cash equivalents |
$ |
227.4 |
|
|
$ |
727.7 |
|
Accounts receivable, net of
allowance for doubtful accounts of $3.0 and $2.3, respectively |
499.4 |
|
|
453.4 |
|
Other current assets |
159.0 |
|
|
108.0 |
|
Total current assets |
885.8 |
|
|
1,289.1 |
|
Property, plant and
equipment, net |
130.7 |
|
|
112.2 |
|
Goodwill |
1,239.5 |
|
|
999.3 |
|
Intangible assets,
net |
389.0 |
|
|
210.3 |
|
Other non-current
assets |
297.3 |
|
|
261.8 |
|
Total assets |
$ |
2,942.3 |
|
|
$ |
2,872.7 |
|
|
|
|
|
Liabilities and
Stockholders’ Equity |
|
|
|
Current liabilities: |
|
|
|
Current portion of long-term
debt |
$ |
124.9 |
|
|
$ |
124.8 |
|
Accounts payable |
134.1 |
|
|
133.2 |
|
Accrued expenses and other current
liabilities |
308.4 |
|
|
352.2 |
|
Deferred revenues |
74.4 |
|
|
82.7 |
|
Total current liabilities |
641.8 |
|
|
692.9 |
|
Long-term debt, excluding
current portion |
1,001.0 |
|
|
890.7 |
|
Deferred taxes |
61.4 |
|
|
61.6 |
|
Deferred revenues |
69.6 |
|
|
70.3 |
|
Other non-current
liabilities |
117.3 |
|
|
111.8 |
|
Total liabilities |
1,891.0 |
|
|
1,827.3 |
|
|
|
|
|
Stockholders’ equity: |
|
|
|
Common stock, $0.01 par value:
650.0 shares authorized; 154.5 and 154.5 shares issued,
respectively; and 119.1 and 118.3 shares outstanding,
respectively |
1.6 |
|
|
1.6 |
|
Additional paid-in capital |
936.5 |
|
|
901.2 |
|
Retained earnings |
1,292.4 |
|
|
1,297.8 |
|
Treasury stock, at cost: 35.4 and
36.2 shares, respectively |
(1,130.2 |
) |
|
(1,116.9 |
) |
Accumulated other comprehensive
loss |
(48.9 |
) |
|
(38.2 |
) |
Total stockholders’ equity |
1,051.3 |
|
|
1,045.5 |
|
Total liabilities and stockholders’
equity |
$ |
2,942.3 |
|
|
$ |
2,872.7 |
|
|
|
|
|
|
|
|
|
Amounts may not sum due to rounding. |
|
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|
Broadridge Financial Solutions,
Inc. |
Condensed Consolidated Statements of Cash
Flows |
(In millions) |
(Unaudited) |
|
|
Three Months Ended September
30, |
|
2016 |
|
2015 |
Cash Flows From
Operating Activities |
|
|
|
Net earnings |
$ |
33.7 |
|
|
$ |
33.5 |
|
Adjustments to reconcile
Net earnings to Net cash flows provided by operating
activities: |
|
|
|
Depreciation and amortization |
17.5 |
|
|
12.4 |
|
Amortization of acquired
intangibles and purchased intellectual property |
12.8 |
|
|
8.1 |
|
Amortization of other assets |
7.4 |
|
|
6.5 |
|
Stock-based compensation
expense |
8.8 |
|
|
9.0 |
|
Deferred income taxes |
(7.8 |
) |
|
(8.8 |
) |
Excess tax benefits from
stock-based compensation awards |
(20.9 |
) |
|
(1.4 |
) |
Other |
2.3 |
|
|
(1.1 |
) |
Changes in operating
assets and liabilities, net of assets and liabilities
acquired: |
|
|
|
Current assets and
liabilities: |
|
|
|
Decrease in Accounts receivable,
net |
44.4 |
|
|
36.7 |
|
Increase in Other current
assets |
(27.5 |
) |
|
(5.9 |
) |
Decrease in Accounts payable |
(7.9 |
) |
|
(3.5 |
) |
Decrease in Accrued expenses and
other current liabilities |
(118.5 |
) |
|
(96.0 |
) |
Increase (decrease) in Deferred
revenues |
(11.7 |
) |
|
2.2 |
|
Non-current assets and
liabilities: |
|
|
|
Increase in Other non-current
assets |
(27.1 |
) |
|
(14.6 |
) |
Increase (decrease) in Other
non-current liabilities |
7.3 |
|
|
(1.7 |
) |
Net cash flows used in
operating activities |
(87.4 |
) |
|
(24.6 |
) |
Cash Flows From
Investing Activities |
|
|
|
Capital expenditures |
(7.2 |
) |
|
(14.9 |
) |
Software purchases and
capitalized internal use software |
(7.6 |
) |
|
(2.9 |
) |
Acquisitions, net of cash
acquired |
(402.0 |
) |
|
— |
|
Purchase of intellectual
property |
(90.0 |
) |
|
— |
|
Equity method
investment |
(1.6 |
) |
|
(0.3 |
) |
Net cash flows used in
investing activities |
(508.4 |
) |
|
(18.1 |
) |
Cash Flows From
Financing Activities |
|
|
|
Proceeds from Long-term
debt |
110.0 |
|
|
65.0 |
|
Repayments on Long-term
debt |
— |
|
|
(20.0 |
) |
Excess tax benefits from
stock-based compensation awards |
20.9 |
|
|
1.4 |
|
Dividends paid |
(35.5 |
) |
|
(32.0 |
) |
Purchases of Treasury
stock |
(40.0 |
) |
|
(3.0 |
) |
Proceeds from exercise of
stock options |
41.4 |
|
|
3.1 |
|
Payment of contingent
consideration liabilities |
— |
|
|
(0.8 |
) |
Costs related to issuance
of bonds |
(0.7 |
) |
|
— |
|
Net cash flows provided by
financing activities |
96.1 |
|
|
13.7 |
|
Effect of exchange rate
changes on Cash and cash equivalents |
(0.7 |
) |
|
(8.8 |
) |
Net change in Cash and
cash equivalents |
(500.3 |
) |
|
(37.8 |
) |
Cash and cash equivalents,
beginning of period |
727.7 |
|
|
324.1 |
|
Cash and cash equivalents,
end of period |
$ |
227.4 |
|
|
$ |
286.3 |
|
Supplemental
disclosure of cash flow information: |
|
|
|
Cash payments made for
interest |
$ |
8.0 |
|
|
$ |
8.5 |
|
Cash payments made for income
taxes, net of refunds |
$ |
55.0 |
|
|
$ |
30.0 |
|
Non-cash investing and financing
activities: |
|
|
|
Accrual of unpaid property, plant
and equipment and software |
$ |
0.6 |
|
|
$ |
— |
|
Obligations related to the purchase
of intellectual property |
$ |
5.0 |
|
|
$ |
— |
|
|
|
|
|
|
|
|
|
Amounts may not sum due to
rounding. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Broadridge Financial Solutions,
Inc. |
Segment Results |
(In millions) |
(Unaudited) |
|
Segment results: |
|
|
|
Revenues |
|
|
|
Three Months Ended September
30, |
|
|
|
2016 |
|
2015 |
|
|
|
(in millions) |
Investor Communication
Solutions |
|
|
$ |
723.3 |
|
|
$ |
429.7 |
|
Global Technology and
Operations |
|
|
187.8 |
|
|
176.8 |
|
Foreign currency
exchange |
|
|
(15.9 |
) |
|
(11.7 |
) |
|
|
|
|
|
|
Total |
|
|
$ |
895.3 |
|
|
$ |
594.7 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings (Loss)
before IncomeTaxes |
|
|
|
Three Months Ended September
30, |
|
|
|
2016 |
|
2015 |
|
|
|
(in
millions) |
Investor Communication Solutions |
|
|
$ |
32.9 |
|
|
$ |
33.9 |
|
Global Technology and Operations |
|
|
|
38.3 |
|
|
|
30.3 |
|
Other |
|
|
|
(22.8 |
) |
|
|
(13.9 |
) |
Foreign currency exchange |
|
|
|
3.2 |
|
|
|
1.3 |
|
|
|
|
|
|
|
|
|
|
|
Total |
|
|
$ |
51.5 |
|
|
$ |
51.7 |
|
|
|
|
|
|
|
|
|
|
|
Amounts may not sum due to rounding. |
|
|
|
|
|
|
|
Broadridge Financial Solutions,
Inc. |
Reconciliation of Non-GAAP to GAAP
Measures |
(In millions, except per share
amounts) |
(Unaudited) |
|
|
|
Three Months Ended |
September 30, |
|
2016 |
|
2015 |
|
(in millions) |
Operating income
(GAAP) |
$ |
66.0 |
|
|
$ |
59.1 |
|
Adjustments: |
|
|
|
Amortization of Acquired
Intangibles and Purchased Intellectual Property |
12.8 |
|
|
8.1 |
|
Acquisition and Integration
Costs |
2.8 |
|
|
1.3 |
|
Adjusted Operating
income (Non-GAAP) |
$ |
81.6 |
|
|
$ |
68.4 |
|
|
|
|
|
Operating income margin (GAAP) |
7.4 |
% |
|
9.9 |
% |
Adjusted Operating income margin
(Non-GAAP) |
9.1 |
% |
|
11.5 |
% |
|
|
|
Three Months Ended |
September 30, |
|
2016 |
|
2015 |
|
(in millions) |
Net earnings
(GAAP) |
$ |
33.7 |
|
|
$ |
33.5 |
|
Adjustments: |
|
|
|
Amortization of Acquired
Intangibles and Purchased Intellectual Property |
12.8 |
|
|
8.1 |
|
Acquisition and Integration
Costs |
2.8 |
|
|
1.3 |
|
Tax impact of adjustments |
(5.4 |
) |
|
(3.3 |
) |
Adjusted Net earnings
(Non-GAAP) |
$ |
43.9 |
|
|
$ |
39.6 |
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
September 30, |
|
2016 |
|
2015 |
Diluted earnings per
share (GAAP) |
$ |
0.28 |
|
|
$ |
0.28 |
|
Adjustments: |
|
|
|
Amortization of Acquired
Intangibles and Purchased Intellectual Property |
0.11 |
|
|
0.07 |
|
Acquisition and Integration
Costs |
0.02 |
|
|
0.01 |
|
Tax impact of adjustments |
(0.04 |
) |
|
(0.03 |
) |
Adjusted earnings per
share (Non-GAAP) |
$ |
0.36 |
|
|
$ |
0.33 |
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
September 30, |
|
2016 |
|
2015 |
|
(in millions) |
Net cash flows used in
operating activities (GAAP) |
$ |
(87.4 |
) |
|
$ |
(24.6 |
) |
|
|
|
|
Capital expenditures
and Software purchases and capitalized internal use software |
(14.7 |
) |
|
(17.8 |
) |
Free cash flow
(Non-GAAP) |
$ |
(102.1 |
) |
|
$ |
(42.4 |
) |
|
|
|
|
|
Note: Amounts may not
sum due to rounding. |
|
|
|
|
Broadridge Financial Solutions,
Inc. |
Reconciliation of Non-GAAP to GAAP
Measures |
Adjusted Earnings Per Share Growth, Adjusted
Operating Income Margin and Free Cash Flow |
Fiscal Year 2017 Guidance |
(In millions, except per share
amounts) |
(Unaudited) |
|
Adjusted
Earnings Per Share Growth Rate (1) |
|
|
Diluted earnings per share
(GAAP) |
|
9% -
14% growth |
Adjusted earnings per share
(Non-GAAP) |
|
12% -
17% growth |
|
|
|
Adjusted
Operating Income Margin (2) |
|
|
Operating income margin %
(GAAP) |
|
~13.6% |
Adjusted Operating income margin %
(Non-GAAP) |
|
~15% |
|
|
|
Free Cash
Flow |
|
|
Net cash flows provided by
operating activities (GAAP) |
|
$470 -
$550 |
Capital expenditures and Software
purchases and capitalized internal use software |
|
(120) -
(150) |
Free cash flow (Non-GAAP) |
|
$350 - $400 |
|
|
|
(1) Adjusted EPS 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 2017 Non-GAAP Adjusted EPS guidance
estimates exclude estimated Amortization of Acquired Intangibles
and Purchased Intellectual Property, and Acquisition and
Integration Costs, net of taxes, of approximately $0.40 per
share.
(2) 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 2017
Non-GAAP Adjusted Operating income margin guidance estimates
exclude Amortization of Acquired Intangibles and Purchased
Intellectual Property, and Acquisition and Integration Costs of
approximately $74 million.
Contact Information
Investors:
W. Edings Thibault
Investor Relations
(516) 472-5129
Media:
Gregg Rosenberg
Corporate Communications
(212) 918-6966
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