SS&C Technologies (NASDAQ:SSNC) Raymond James Institutional Investor Conference March 9, 2016

Transcription

1 SS&C Technologies (NASDAQ:SSNC) Raymond James Institutional Investor Conference March 9, 2016

2 2 Safe Harbor Statement This presentation contains forward-looking statements, as defined by federal and state securities laws, which are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of Forward-looking statements include statements concerning plans, objectives, goals, strategies, expectations, intentions, projections, developments, future events, performance or products, underlying assumptions, and other statements which are other than statements of historical facts. In some cases, you can identify forward-looking statements by terminology such as ''may,'' ''will,'' ''should,'' hope,'' "expects,'' ''intends,'' ''plans,'' ''anticipates,'' "contemplates," ''believes,'' ''estimates,'' ''predicts,'' ''projects,'' ''potential,'' ''continue,'' and other similar terminology or the negative of these terms. From time to time, we may publish or otherwise make available forward-looking statements of this nature. All such forward-looking statements, whether written or oral, and whether made by us or on our behalf, are expressly qualified by the cautionary statements described on this message including those set forth below. All statements contained in this presentation are made only as of the date of this presentation. In addition, except to the extent required by applicable securities laws, we undertake no obligation to update or revise any forward-looking statements to reflect events, circumstances, or new information after the date of the information or to reflect the occurrence or likelihood of unanticipated events, and we disclaim any such obligation. Forward-looking statements are only predictions that relate to future events or our future performance and are subject to known and unknown risks, uncertainties, assumptions, and other factors that may cause actual results, outcomes, levels of activity, performance, developments, or achievements to be materially different from any future results, outcomes, levels of activity, performance, developments, or achievements expressed, anticipated, or implied by these forward-looking statements. Other factors that could affect actual results, outcomes, levels of activity, performance, developments or achievements can be found under the heading Risk Factors in SS&C Technologies Holdings, Inc. s Form 10-K, filed February 27, As a result, we cannot guarantee future results, outcomes, levels of activity, performance, developments, or achievements, and there can be no assurance that our expectations, intentions, anticipations, beliefs, or projections will result or be achieved or accomplished.

3 Leading provider of mission-critical cloud-based software for financial services providers with a flexible, on-demand delivery model 3

4 4 SS&C Summary About Founded in 1986, 6,100+ employees, 73 offices worldwide, NASDAQ: SSNC (since Q1 2010) Clients, Revenues 10,000+ clients 91% contractually recurring revenues, 41.8% LTM EBITDA margins 2016 Guidance Adjusted Revenue for 2016 of $1,360.0 mil - $1,380.6 mil Adjusted Net Income of $312.5 mil - $325.0 mil Cash from Operating Activities of $355.0 mil - $370.0 mil

5 5 Experienced Management Team WILLIAM C. STONE Chairman & Chief Executive Officer NORMAND A. BOULANGER Chief Operating Officer PATRICK J. PEDONTI Chief Financial Officer PAUL G. IGOE General Counsel RAHUL KANWAR Managing Director of Alternative Assets PETE HESS Managing Director, SS&C s Advent Business Average 20+ Years of Experience

6 Broad Solutions Footprint Private Equity Hedge Funds Fund of Funds Managed Accounts Asset Managers Banks Portfolio Management Reconciliation Valuation Performance and Attribution Reporting Risk Management Regulatory Solutions Investor Services Training Registered Investment Advisors Family Offices Wealth Managers Endowment / Pension Funds Insurance Companies Real Estate 6

7 7 Business Distribution Business Alternative Assets Institutional and Investment Management Advisory Targeted Solutions Hedge Funds Fund of Funds Private Equity Fund Administration Institutional Asset Management Insurance REITs Pension Funds Wealth Management RIAs Property Management Municipal Finance Financial Modeling Money Market processing Training Research Management 2015 Revenue Business Distribution by End Market* Advisory Institutional and Investment Management 9% Targeted Solutions 31% 10% 49% Alternative Assets *Includes FY 2105 Advent Revenue

8 Industry Dynamics

9 The SS&C Solution Fund Administration / Operations Financial Technology SS&C is a leading provider of financial software and services, and offers best-in-class solutions to the investment management industry 9

10 Attractive Industry Dynamics Market Drivers Total Worldwide Banking and Securities IT Spending by Software Segment (US$Bn) CAGR 7% GLOBALIZING WEALTH INFORMATION ANYTIME, ANYWHERE Source: Gartner Global Hedge Fund AUM (US$Tn) CAGR 19% INCREASING REGULATORY BURDENS CLOUD CAPABILITIES Source: HFR industry report 10

11 A Market in Transition Fund Administration Hedge Fund Administrator Ranking April 2006 (AUA $bil)* Hedge Fund Administrator Ranking April 2015 (AUA $bil)* Company $ AUA % of Total 1 CITCO Fund Services % 2 HSBC % 3 State Street % 4 BISYS % 5 Goldman Sachs % 6 Investors Bank & Trust % 7 Fortis Prime Fund Solutions % 8 CACEIS Investor Services % 9 GlobeOp % 10 BNY Mellon % Top 10 1, % Total 1, % Company $ AUA % of Total 1 State Street % 2 CITCO Fund Services % 3 BNY Mellon % 4 SS&C GlobeOp % 5 Citi % 6 Northern Trust % 7 Morgan Stanley Fund Services % 8 HedgeServ % 9 SEI % 10 RBC Investor & Treasury Services % Top 10 3, % Total 5, % *HFM Week Survey includes Hedge Fund AUA only 11

12 A Market in Transition Financial Technology Top Companies by Revenue in Fintech 2006* Top Companies by Revenue in Fintech 2015* Rank Company Company 1 Fiserv, Inc. 2 FIS 3 Sungard 4 NCR Corporation 5 First Data Corporation 6 Unisys 7 Diebold, Inc 8 Reuters Group 9 Total System Services 10 DST Systems 1 Tata Consultancy Services (TCS) 2 FIS 3 Fiserv, Inc. 4 Cognizant Technology Solutions 5 NCR Corporation 6 Infosys Limited 7 Diebold, Inc. 8 Sungard 9 Wincor Nixdorf 10 Nomura Research Institute, Ltd. 54 Advent Software 55 SS&C Technologies 23 SS&C Technologies 40 Advent Software 91 Primatics Financial *Source: IDC Financial Insights: The FinTech Rankings categorize and evaluate technology providers based on calendar year revenues from financial institutions for hardware, software and/or services 12

13 13 Investing in Innovation SS&C HAS COMPLETED 43 ACQUISITIONS TO DATE CHALKE, INC. SHEPRO BRAUN QUANTRA THE SAVID GROUP HEDGEWARE, INC. DIGITAL VISIONS REAL-TIME USA DBC OMR SYSTEMS NEOVISION HYPERSYSTEMS EISNERFAST FMC ZOOLOGIC NORTHPORT MICRODESIGN SERVICES MAXIMIS TRADEWARE THENEXTROUND, INC. GELLER INVESTMENT PARTNERSHIP SERVICES PORTIA GLOBEOP PRIME MANAGEMENT DST GLOBAL SOLUTIONS ADVENT SOFTWARE VARDEN TECHNOLOGIES PRIMATICS FINANCIAL

14 M&A in Last 12 Months Acquisition Closed Price Rationale Ownership of fund administration platform, Geneva Advent Software 7/6/2015 $2.7 bil Best-in-class portfolio accounting software solutions Foothold in fast growing RIA market Varden Technologies 9/2/2015 $25 mil Tuck-in acquisition that provides advanced client communications solutions Leveragable across SS&C s client base Primatics Financial 11/16/2015 $116 mil About $50 million in revenue Evolv, end-to-end loan risk and finance solution Will make SS&C 2 nd largest fund administrator Citi Fund Services Pending ~$425 mil Private equity presence in Asia Can bring margins to corporate average 14

15 Competition and Clients

16 16 Key Competitors by Market Alternative Asset Fund Administration Institutional and Investment Management Advisory SS&C is the only company that provides software and services solutions across all three markets, and offers a flexible, on demand delivery model

17 17 Over 10,000 Blue Chip Clients Alternatives Institutional & Investment Management Advisory Other

18 Financials

19 Revenue Distribution LTM 12/31/15 Business Distribution LTM 12/31/15 Currency Exposure LTM 12/31/15 Geographic Distribution Non-Recurring $ AUD GBP Other APAC $ CAD EMEA Recurring $ USD Americas Recurring: Software Enabled Services, Maintenance, Term license revenue Non-Recurring: Perpetual license, professional service revenue Other: EUR, RM, THB, $ SGD, ZAR, CNY, $ HKD 19

20 High Margin Business Model Strong Revenue performance and high margin business model 4Q 2015 Adjusted Revenue increased 61.9% to $325.8 million compared to 4Q Q 2015 Adj. Con. EBITDA is $139.8 million, increased 66.2% since 4Q 2014 *Analyst Estimates 20

21 21 High Quality Earnings Adjusted net income increased 34.6% to $73.6 million in 4Q 2015 Net cash from operating activities was $110.1 million for Q $67.5 million of deal and financing costs for 2015 DSO as of December 2015 is 45 days

22 22 Resilient Operating Platform during SS&C Revenue ($MM) $280 $ SS&C EBITDA ($MM) and Margin (%) $113 $111 Advent Revenue ($MM) $260 $ Advent EBITDA ($MM) and Margin (%) $62 High level of revenue visibility and flexible cost base allowed for SS&C and Advent management to predict revenue headwinds in 2009, and implement cost control initiatives to increase EBITDA margin 40% 41% $47 20% 24%

23 23 Adjusted Diluted EPS since 2010 IPO $3.50 $3.00 $2.50 $ % CAGR $1.97 $2.36 $2.66 $3.09 E 4Q 2015 adjusted diluted EPS $0.72 Share count increased to million for Q $1.50 $1.00 $0.90 $1.07 $ % CAGR since our 2010 IPO $0.50 $ E

24 Proven History of Deleveraging Historical Leverage (1) 5.3x deleveraging 2.7x deleveraging (2) (3) (4) (5) (6) (7) 11/23/ SS&C is taken private by the Carlyle Group and SS&C management for $1.05bn 3/31/ SS&C completes its IPO, raising $135MM 2/9/ SS&C issues a follow-on offering, raising $52MM 3/14/ SS&C acquires GlobeOp for $834MM after acquiring PORTIA for $170MM Standalone at 3/31/15 Pro Forma for Advent Acquisition 1. Reflected as net debt / consolidated EBITDA 2. Balance sheet data and LTM consolidated EBITDA as of 9/30/05, as adjusted to give effect to the debt incurred related to the leveraged buyout 3. Balance sheet data and LTM consolidated EBITDA as of 3/31/10 4. Balance sheet data and LTM consolidated EBITDA as of 12/31/10 5. Balance sheet data and LTM consolidated EBITDA as of 6/30/12 6. Balance sheet data and LTM consolidated EBITDA as of 3/31/15 7. Balance sheet data as of 3/31/15 and based on LTM 3/31/15 combined Acquisition Adj. EBITDA of $532MM, which includes anticipated synergies of approximately $45MM. For combined Acquisition Adj. EBITDA reconciliation and details related to synergies, see slide 40 24

25 25 Q Financial Highlights Metric Q Q $ +/- % +/- Adjusted Revenue ($mm) $325.8 $201.2 $ % Adjusted Operating Income ($mm) $133.3 $80.2 $ % Adjusted Net Income ($mm) $73.6 $54.7 $ % Adjusted Consolidated EBITDA ($mm) $139.8 $84.1 $ % Adjusted EBITDA Margin 42.9% 41.8% 110bps 2.6%

26 26 Q1 and Full Year 2016 Guidance Q Guidance Metric Range ($mm) Revenue $327.0 $333.0 Adjusted Net Income $72.0 $75.0 Diluted shares Full Year 2016 Guidance Metric Range ($mm) Revenue $1,360.0 $ Adjusted Net Income $312.5 $325.0 Diluted shares Cash from Operating activities $355.0 $370.0

27 27 Target Operating Model Organic revenue growth of 5%-10% Disciplined acquisition strategy to provide further upside EBITDA margins of 41-43% near term with potential for future growth Operating cash flow to pay down debt, fund acquisitions, or pay quarterly dividend Capex consistent with historical levels of % of revenue

28 28 Who Owns SS&C? Institutional Owners* % Owned 1. T. Rowe Price Associates, Inc. 15.8% 2. Fidelity Management & Research Co. 6.6% 3. Janus Capital Management LLC 5.9% 4. The Vanguard Group, Inc. 5.6% 5. Baron Capital Management, Inc. 4.9% SS&C Ownership William C. Stone, Chairman and CEO 16.8% Directors, Management, Employee Stock Options 5.2%

29 SS&C Technologies (NASDAQ:SSNC)