Broadridge registers 17% Y/Y rise in revenues in Q1 FY22
Broadridge Financial Solutions, Inc. (NYSE:BR) today reported financial results for the first quarter ended September 30, 2021 of its fiscal year 2022.
Total revenues increased 17% to $1,193 million from $1,017 million in the prior year period.
Recurring fee revenues increased 16% to $751 million from $650 million. The increase was driven by 5pts of net new business and 2pts of internal growth. Growth from acquisitions was 9pts, most notably from the Itiviti acquisition which closed in May 2021.
Event-driven fee revenues increased $31 million, or 69%, to $76 million, primarily due to increased mutual fund proxy activity.
Distribution revenues increased $36 million, or 11%, to $367 million, driven by an increase in customer communications mailings and event-driven activity.
Operating income was $103 million, an increase of $25 million, or 31%. Operating income margin increased to 8.7%, compared to 7.7% for the prior year period due to growth in recurring and event-driven revenues and the absence of the real estate realignment charge that occurred in the prior year period, which more than offset higher amortization expense from acquired intangible assets and other spending.
Adjusted Operating income was $177 million, an increase of $26 million, or 17%. The increase was driven by higher recurring revenues, including from the acquisition of Itiviti, and event-driven revenues, partially offset by growth investments and other spending. Adjusted Operating income margin was flat at 14.8%.
Net earnings increased 2% to $67 million and Adjusted Net earnings increased 10% to $126 million.
Diluted earnings per share increased 2% to $0.57, compared to $0.56 in the prior year period and Adjusted earnings per share increased 9% to $1.07, compared to $0.98 in the prior year period.
Tim Gokey, Broadridge’s CEO, commented:
“Broadridge reported strong first quarter results. Recurring revenues grew by 16%, propelled by revenue from new sales, continued robust governance trends, and our ongoing integration of Itiviti.
With a strong first quarter, Broadridge is on track to achieve our full-year guidance of 12-15% recurring revenue growth and 11-15% Adjusted EPS growth. We are focused on delivering sustainable, long-term growth across our governance, capital markets and wealth businesses, and we remain well-positioned to achieve the higher end of our three-year growth objectives.”
During the first quarter of fiscal year 2022, Broadridge completed the acquisitions of the assets of Jordan & Jordan, as well as the approximately 68% of Alpha Omega that Broadridge did not already own.
The acquisition of the Jordan & Jordan assets will enable Broadridge to further extend its strategic regulatory reporting capabilities as well as add compliance and regulatory reporting consulting capabilities. The Alpha Omega acquisition will enable Broadridge to fully consolidate Alpha Omega’s post-trade matching and consolidation solution into its existing NYFIX connectivity and FIX infrastructure to better automate buy-side and sell-side firms’ trade matching processes.