FactSet ("FactSet" or the “Company”) (NYSE:FDS) (NASDAQ:FDS), a
global financial digital platform and enterprise solutions
provider, today announced results for its fourth quarter and full
fiscal year 2023 ended August 31, 2023.
Fourth Quarter Fiscal 2023 Highlights
- GAAP revenues
increased 7.3%, or $36.5 million, to $535.8 million for the fourth
quarter of fiscal 2023 compared with $499.3 million for the same
period in fiscal 2022. The increase was primarily due to higher
sales of Analytics & Trading and Content & Technology
solutions. Organic revenue, which excludes the effects of
acquisitions and dispositions completed within the last 12 months
and foreign currency movements, grew 7.2% to $535.2 million during
the fourth quarter of fiscal 2023 from the prior year period.
- Annual Subscription
Value (ASV) plus professional services was $2.2 billion at
August 31, 2023, compared with $2.01 billion at
August 31, 2022. Organic ASV plus professional services, which
excludes the effects of acquisitions and dispositions completed
within the last 12 months and foreign currency movements, was $2.2
billion at August 31, 2023, up $145.0 million from the prior
year at a growth rate of 7.1%.
- Organic ASV plus
professional services increased $54.9 million over the last three
months. The primary contributors to this growth were higher sales
of Analytics & Trading and Content & Technology solutions.
Please see the “ASV + Professional Services” section of this press
release for details.
- GAAP operating
margin decreased to 21.9% compared with 26.5% for the
prior year, primarily due to non-recurring restructuring and
facilities impairment, partially offset by lower third-party
content costs and lower foreign currency impact. Adjusted operating
margin improved to 33.6% compared with 31.5% in the prior year
period driven by a lower bonus accrual, partially offset by higher
salary expenses. Higher technology expenses were offset by lower
third-party content, facilities expenses and foreign currency
impact.
- Fourth quarter results include an
out-of-period adjustment related to an ongoing review and analysis
of certain tax positions, resulting in a one-time charge of $6.8
million and a $20 million provision. FactSet believes this $20
million provision represents the maximum remaining amount of net
unrealizable tax assets. Upon completion of its review, and prior
to filing its Annual Report on Form 10-K, FactSet plans to take a
one-time charge with respect to this provision to reflect the
confirmed actual amount of net unrealizable tax assets. The final
amount of this charge is not expected to differ significantly from
the current $20 million provision. At this time, FactSet has
concluded that this adjustment is not material to the current
period financial statements. The adjustment relates to the
accounting of tax balance sheet accounts, including deferred tax
assets and liabilities. All local, federal and foreign taxes
payable have been paid in a timely manner, subject to normal audits
of open years.
- GAAP diluted earnings per
share (EPS) decreased 37.5% to $1.68 compared with $2.69
for the same period in fiscal 2022, mainly due to non-recurring
charges and the higher tax provision, which had a $0.68 impact.
Adjusted diluted EPS decreased 6.4% to $2.93, compared with $3.13
for the prior year period, mainly due to non-recurring charges and
the higher tax provision, which had a $0.68 impact.
- Adjusted EBITDA
increased to $172.2 million, up 8.6% for the fourth quarter of
fiscal 2023 compared with $158.5 million for the same period in
fiscal 2022, due to higher income tax add-backs and impairment
charges, partially offset by lower net income.
- In connection with the acquisition
of CGS, FactSet entered into a new credit agreement providing for a
$1 billion term loan and revolving credit facilities. In the fourth
quarter of fiscal 2023, FactSet paid $62.5 million towards the term
loan. As of August 31, 2023, FactSet had a term loan principal
balance of $375 million, having made $625 million in total term
loan principal payments since the inception of the loan.
- The Company’s
effective tax rate for the fourth quarter of
fiscal 2023 increased to 39.9% compared with 10.3% for the three
months ended August 31, 2022, primarily due to one-time
adjustments of certain tax positions, expiring foreign tax
incentives, and higher foreign statutory rates.
_____________________________________________1
Prior year Total ASV now reflects additional CGS revenues not
previously included.
"During a transformative period where technology
is reshaping our industry, FactSet's open platform strategy is
resonating with clients seeking new sources of growth as well as
increased efficiency,” said Phil Snow, FactSet CEO. “Our unwavering
commitment to innovation is putting the full power of our vast
repository of connected data and analytical capabilities at our
clients' fingertips.”
Key Financial Measures*
(Condensed and Unaudited) |
Three Months Ended |
|
|
Twelve Months Ended |
|
Latest |
|
August 31, |
|
|
August 31, |
|
FY 2023 |
(In
thousands, except per share data) |
|
2023 |
|
|
2022 |
|
Change |
|
|
2023 |
|
|
2022 |
|
Change |
Guidance |
Revenues |
$ |
535,797 |
|
$ |
499,297 |
|
7.3 |
% |
|
$ |
2,085,508 |
|
$ |
1,843,892 |
|
13.1 |
% |
$2.08 - $2.10B |
Organic revenues |
$ |
535,224 |
|
$ |
499,297 |
|
7.2 |
% |
|
$ |
1,994,953 |
|
$ |
1,843,917 |
|
8.2 |
% |
|
Operating income |
$ |
117,103 |
|
$ |
132,219 |
|
(11.4 |
)% |
|
$ |
630,207 |
|
$ |
475,482 |
|
32.5 |
% |
|
Adjusted operating income |
$ |
180,134 |
|
$ |
157,480 |
|
14.4 |
% |
|
$ |
755,188 |
|
$ |
624,395 |
|
20.9 |
% |
|
Operating margin |
|
21.9 |
% |
|
26.5 |
% |
|
|
|
30.2 |
% |
|
25.8 |
% |
|
29% - 30% |
Adjusted operating margin |
|
33.6 |
% |
|
31.5 |
% |
|
|
|
36.2 |
% |
|
33.9 |
% |
|
35% - 36% |
Net income |
$ |
65,080 |
|
$ |
104,422 |
|
(37.7 |
)% |
|
$ |
468,134 |
|
$ |
396,917 |
|
17.9 |
% |
|
Adjusted net income |
$ |
113,556 |
|
$ |
121,512 |
|
(6.5 |
)% |
|
$ |
565,990 |
|
$ |
520,279 |
|
8.8 |
% |
|
Adjusted EBITDA |
$ |
172,207 |
|
$ |
158,514 |
|
8.6 |
% |
|
$ |
777,620 |
|
$ |
628,179 |
|
23.8 |
% |
|
Diluted EPS |
$ |
1.68 |
|
$ |
2.69 |
|
(37.5 |
)% |
|
$ |
12.03 |
|
$ |
10.25 |
|
17.4 |
% |
$12.25 - $12.65 |
Adjusted diluted EPS |
$ |
2.93 |
|
$ |
3.13 |
|
(6.4 |
)% |
|
$ |
14.55 |
|
$ |
13.43 |
|
8.3 |
% |
$14.75 - $15.15 |
* See reconciliation of U.S. GAAP to adjusted
key financial measures in the back of this press release.
“FactSet made good progress on expense
management," said Linda Huber, FactSet CFO. "Looking ahead, we will
maintain our focus on sustainable growth and profitability to fuel
innovation.”
Full Year 2023 Highlights
- GAAP Revenues
increased 13.1% to $2.09 billion, up 8.2% on an organic basis,
based primarily on the lapping of the CGS acquisition and stronger
organic ASV. This marked the 43rd consecutive year of revenue
increase for the Company.
- GAAP operating
margin increased to 30.2% compared with 25.8% for the
prior year, primarily due to the lapping of prior year facilities
impairment, partially offset by lower third-party content costs and
lower foreign currency impact. Adjusted operating margin improved
to 33.6% compared with 31.5% in the prior year period driven by a
lower bonus accrual, partially offset by higher salary expenses.
Higher technology expenses were offset by lower third-party
content, facilities expenses and foreign currency
impact.
- Diluted EPS
increased 17.4% to $12.03, mainly driven by revenue growth and the
lapping of one time charges of the prior year. This was partially
offset by a higher tax provision, which had a $0.68 impact.
Adjusted diluted EPS increased 8.3% to $14.55, primarily driven by
revenue growth and margin expansion. It was partially offset by
higher interest expense and higher tax provisions, which had a
$0.68 impact. Fiscal 2023 marks the 27th consecutive year that
FactSet has increased its adjusted diluted EPS.
- Net cash provided by operating
activities totaled $645.6 million, driven by higher net income and
the timing of estimated tax payments. Free cash flow increased
20.0% to $584.8 million, primarily due to the timing of estimated
tax payments, partially off set by higher capital
expenditures.
- Client count increased by 5.1% or
383 during the year, while users grew by 5.6% or 9,990 from the
prior year.
- In April 2023, FactSet increased
its quarterly cash dividend by 10% to $0.98 per share. The $0.09
per share increase marks the twenty-fourth consecutive year the
Company has increased dividends, highlighting FactSet's continued
commitment to return value to its shareholders.
- The Company returned $315.3 million
to shareholders in share repurchases and dividends during the 2023
fiscal year, for a return of 25% as a percentage of free cash flow
and proceeds from employee stock plans.
- FactSet won several awards in 2023,
with honors noted for research, risk, performance, trading, and
wealth management. FactSet was honored by more than thirty industry
awards and rankings reports, including winning “Trading Tech’s Best
Cloud-Based Market Data Delivery Solution.”
Annual Subscription Value (ASV) + Professional
Services1
ASV at any given point in time represents the forward-looking
revenues for the next twelve months from all subscription services
currently supplied to clients. Professional services are revenues
derived from project-based consulting and implementation.
ASV plus professional services was $2,174.6 million at
August 31, 2023, compared with $2,027.4 million at
August 31, 2022. Organic ASV plus professional services was
$2,175.1 million at August 31, 2023, up $145 million from the
prior year at a growth rate of 7.1%. Organic ASV, which excludes
the effects of acquisitions and dispositions completed within the
last 12 months and foreign currency movements, plus professional
services, increased $54.9 million over the last three months.
Buy-side and sell-side organic ASV growth rates for the fourth
quarter of fiscal 2023 were 6.9% and 9.3%, respectively. Buy-side
clients, including asset managers, wealth managers, asset owners,
hedge funds, partners, and corporate clients, accounted for
approximately 82% of organic ASV. The remaining organic ASV came
from sell-side firms, including broker-dealers, banking and
advisory, private equity and venture capital firms. Supplementary
tables covering organic buy-side and sell-side ASV growth rates may
be found on the last page of this press release.
Segment Revenues and ASV1
ASV from the Americas region was $1,376.9
million compared with ASV in the prior year period of $1,286.7
million. Organic ASV increased 7.0% to $1,376.9 million. Americas
revenues for the quarter increased to $343.3 million compared with
$323.6 million in the fourth quarter of last year. Excluding the
effects of acquisitions and dispositions completed in the last 12
months, the Americas region's organic revenues growth rate was
6.0%.
ASV from the EMEA region was $559.6 million
compared with ASV in the prior year period of $516.1 million.
Organic ASV increased 7.7% to $558.8 million. EMEA revenues were
$138.6 million compared with $126.4 million in the fourth quarter
of fiscal 2022. Excluding the effects of acquisitions and
dispositions completed in the last 12 months and foreign currency
impacts, the EMEA region's organic revenues growth rate was
9.1%.
ASV from the Asia Pacific region was $215.4
million compared with ASV in the prior year period of $200.5
million. Organic ASV increased 8.1% to $216.7 million. Asia Pacific
revenues were $53.9 million compared with $49.3 million in the
fourth quarter of fiscal 2022. Excluding the effects of
acquisitions and dispositions completed in the last 12 months and
foreign currency impacts, the Asia Pacific region's organic
revenues growth rate was 9.9%.
Segment ASV does not include professional
services, which totaled $22.7 million at August 31, 2023.
Organic ASV plus professional services from
FactSet’s workflow solutions at August 31, 2023 was as follows:
- Research & Advisory ASV was
$922 million, representing 4.7% growth year over year.
- Analytics & Trading ASV was
$708 million, growing 8.8% year over year.
- Content and Technology Solutions
(CTS) ASV was $545 million, increasing 9.3% year over year. This
amount includes ASV related to CGS, which is now included in
organic ASV.
Operational Highlights – Fourth Quarter Fiscal 2023
- Client count as
of August 31, 2023 was 7,921, a net increase of 151 clients in
the past three months, primarily driven by an increase in corporate
and wealth management clients, as well as channel partners. The
count includes clients with ASV of $10,000 and more.
- User count
increased by 2,127 to 189,972 in the past three months, primarily
driven by an increase in banking and wealth management
clients.
- Annual ASV
retention was greater than 95%. When expressed as a percentage of
clients, annual retention was 91%.
- Employee count
was 12,237 as of August 31, 2023, up 9.2% over the last twelve
months, with the increase primarily in our Centers of Excellence.
Growth was largely driven by an increase in the content, product,
and technology organizations. 67% of our employees are in our
Centers of Excellence.
- Net cash
provided by operating activities increased to $175.9 million
compared with $147.2 million for the fourth quarter of fiscal 2022,
primarily related to higher net income as well as the timing of
income tax payments. Quarterly free cash flow increased to $156.3
million compared with $136.1 million a year ago, an increase of
14.8%, driven by the timing of income tax payments partially offset
by higher capital expenditures.
- A quarterly
dividend of $37.3 million, or $0.98 per share, was paid on
September 21, 2023, to holders of record of FactSet’s common
stock at the close of business on August 31, 2023.
- FactSet
acquired idaciti, Inc., an innovator in data structuring and
collection technology, expanding on the Company's multi-year
investment program to digitally transform its content collection
infrastructure and accelerating time-to-market for delivering
critical data sets.
- CGS announced
the launch of a new CUSIP based entity identifier for the $5
trillion syndicated corporate loan market.
- The Company
appointed Catrina Harding as Executive Vice President, Chief People
Officer. In this role, she oversees FactSet’s global human
resources organization and reports directly to Chief Executive
Officer (CEO) Phil Snow.
- FactSet
announced that it has appointed Ali van Nes as Senior Vice
President, Investor Relations. She will replace Kendra Brown, who
will now lead FactSet’s Banking and Sell-Side Research workflow
solution.
Share Repurchase Program
FactSet repurchased 264,400 shares of its common
stock for $109.6 million at an average price of $414.63 during the
fourth quarter under the Company’s existing share repurchase
program. As of August 31, 2023, $4.5 million remained
available for share repurchases under this program. On June 20,
2023, the Board of Directors of FactSet approved a new share
repurchase program of up to $300 million, which became available on
September 1, 2023.
Annual Business Outlook
FactSet is providing its outlook for fiscal
2024. The following forward-looking statements reflect FactSet's
expectations as of today's date. Given the risk factors,
uncertainties, and assumptions discussed below, actual results may
differ materially. FactSet does not intend to update its
forward-looking statements prior to its next quarterly results
announcement.
Fiscal 2024 Expectations
- Organic ASV
plus professional services is expected to grow in the range of $130
million to $175 million during fiscal 2024.
- GAAP revenues
are expected to be in the range of $2,210 million to $2,230
million.
- GAAP operating
margin is expected to be in the range of 33.1% to 33.5%.
- Adjusted
operating margin is expected to be in the range of 36.3% to
36.7%.
- FactSet's
annual effective tax rate is expected to be in the range of 17.0%
to 18.0%.
- GAAP diluted
EPS is expected to be in the range of $14.20 to $14.70.
- Adjusted
diluted EPS is expected to be in the range of $15.65 to
$16.15.
Both GAAP operating margin and GAAP diluted EPS
guidance do not include certain effects of any non-recurring
benefits or charges that may arise in fiscal 2024. Please see the
back of this press release for a reconciliation of GAAP to adjusted
metrics.
Conference Call
Fourth Quarter 2023 Conference Call Details |
|
|
|
Date: |
|
Thursday, September 21, 2023 |
Time: |
|
11:00 a.m. Eastern Time |
Participant Registration: |
|
FactSet Q4 2023 Earnings Call Registration |
|
|
|
Please register for the conference call using
the above link before the call start time. The conference call
platform will register your name and organization and provide
dial-in numbers and a unique access pin. The conference call will
have a live Q&A session.
A replay will be available on the Company’s
investor relations website after 1:00 p.m. Eastern Time on
September 21, 2023, through September 21, 2024. The earnings call
transcript will be available via FactSet CallStreet.
Forward-looking Statements
This news release contains forward-looking
statements based on management's current expectations, estimates,
forecasts and projections about industries in which FactSet
operates and the beliefs and assumptions of management. All
statements that address expectations, guidance, outlook or
projections about the future, including statements about the
Company's strategy for growth, product development, revenues,
future financial results, anticipated growth, market position,
subscriptions, expected expenditures, trends in FactSet’s business
and financial results, are forward-looking statements.
Forward-looking statements may be identified by words like
"expects," "believes," "anticipates," "plans," "intends,"
"estimates," "projects," "should," "indicates," "continues," "may"
and similar expressions. These statements are not guarantees of
future performance and involve a number of risks, uncertainties and
assumptions. Many factors, including those discussed more fully
elsewhere in this release and in FactSet's filings with the
Securities and Exchange Commission, particularly its latest annual
report on Form 10-K and quarterly reports on Form 10-Q, as well as
others, could cause results to differ materially from those stated.
Forward-looking statements speak only as of the date they are made,
and FactSet assumes no duty to and does not undertake to update
forward-looking statements. Actual results could differ materially
from those anticipated in forward-looking statements and future
results could differ materially from historical performance.
About Non-GAAP Financial Measures
Financial measures in accordance with U.S. GAAP
including revenues, operating income and margin, net income,
diluted earnings per share and cash provided by operating
activities have been adjusted.
FactSet uses these adjusted financial measures
both in presenting its results to stockholders and the investment
community and in its internal evaluation and management of the
business. The Company believes that these adjusted financial
measures and the information they provide are useful to investors
because they permit investors to view the Company’s performance
using the same tools that management uses to gauge progress in
achieving its goals. Investors may benefit from referring to these
adjusted financial measures in assessing the Company’s performance
and when planning, forecasting and analyzing future periods and may
also facilitate comparisons to its historical performance. The
presentation of this financial information is not intended to be
considered in isolation or as a substitute for the financial
information prepared and presented in accordance with GAAP.
Adjusted revenues exclude the impact of the fair
value of deferred revenues acquired in a business combination.
Organic revenues further exclude the effects of acquisitions and
dispositions completed in the last 12 months and foreign currency
movements in all periods presented. Adjusted operating income and
margin, adjusted net income, and adjusted diluted earnings per
share exclude intangible asset amortization, the impact of the fair
value of deferred revenues acquired in a business combination and
non-recurring items. EBITDA excludes interest expense, provision
for income taxes and depreciation and amortization expense, while
Adjusted EBITDA further excludes non-recurring non-cash expenses.
The Company believes that these adjusted financial measures help to
fully reflect the underlying economic performance of FactSet.
Cash flows provided by operating activities has
been reduced by purchases of property, equipment, leasehold
improvements and capitalized internal-use software to report
non-GAAP free cash flow. FactSet uses this financial measure both
in presenting its results to stockholders and the investment
community and in the Company’s internal evaluation and management
of the business. Management believes that this financial measure is
useful to investors because it permits investors to view the
Company’s performance using the same metric that management uses to
gauge progress in achieving its goals and is an indication of cash
flow that may be available to fund further investments in future
growth initiatives.
About FactSet
FactSet (NYSE:FDS | NASDAQ:FDS) helps the
financial community to see more, think bigger, and work better. Our
digital platform and enterprise solutions deliver financial data,
analytics, and open technology to nearly 8,000 global clients,
including almost 190,000 individual users. Clients across the
buy-side and sell-side as well as wealth managers, private equity
firms and corporations achieve more every day with our
comprehensive and connected content, flexible next-generation
workflow solutions, and client-centric specialized support. As a
member of the S&P 500, we are committed to sustainable growth
and have repeatedly scored 100 on the Human Rights Campaign®
Corporate Equality Index. We have been recognized amongst the Best
Places to Work in 2023 by Glassdoor as a Glassdoor Employees’
Choice Award winner. Learn more at www.factset.com and follow us on
Twitter and LinkedIn.
FactSet Investor Relations Contact:
Ali
van Nes
+1.203.810.2273 Avannes@factset.com
Media ContactMegan
Kovach+1.512.736.2795megan.kovach@factset.com
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consolidated Statements of
Income |
|
|
|
|
|
|
(Unaudited) |
|
|
|
|
|
|
|
|
Three Months Ended |
|
Twelve Months Ended |
|
|
August 31, |
|
August 31, |
(In thousands, except per share data) |
|
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
Revenues |
|
$ |
535,797 |
|
|
$ |
499,297 |
|
|
$ |
2,085,508 |
|
|
$ |
1,843,892 |
|
Operating expenses |
|
|
|
|
|
|
|
|
Cost of services |
|
|
263,688 |
|
|
|
241,944 |
|
|
|
973,225 |
|
|
|
871,106 |
|
Selling, general and administrative |
|
|
130,227 |
|
|
|
123,847 |
|
|
|
456,130 |
|
|
|
433,032 |
|
Asset impairments |
|
|
24,779 |
|
|
|
1,287 |
|
|
|
25,946 |
|
|
|
64,272 |
|
Total operating expenses |
|
|
418,694 |
|
|
|
367,078 |
|
|
|
1,455,301 |
|
|
|
1,368,410 |
|
|
|
|
|
|
|
|
|
|
Operating income |
|
|
117,103 |
|
|
|
132,219 |
|
|
|
630,207 |
|
|
|
475,482 |
|
|
|
|
|
|
|
|
|
|
Other income (expense), net |
|
|
|
|
|
|
|
|
Interest income |
|
|
4,618 |
|
|
|
1,276 |
|
|
|
12,809 |
|
|
|
6,175 |
|
Interest expense |
|
|
(16,691 |
) |
|
|
(15,580 |
) |
|
|
(66,319 |
) |
|
|
(35,697 |
) |
Other income (expense), net |
|
|
3,279 |
|
|
|
(1,487 |
) |
|
|
8,257 |
|
|
|
(2,366 |
) |
Total other income (expense),
net |
|
|
(8,794 |
) |
|
|
(15,791 |
) |
|
|
(45,253 |
) |
|
|
(31,888 |
) |
|
|
|
|
|
|
|
|
|
Income before income
taxes |
|
|
108,309 |
|
|
|
116,428 |
|
|
|
584,954 |
|
|
|
443,594 |
|
|
|
|
|
|
|
|
|
|
Provision for income taxes |
|
|
43,229 |
|
|
|
12,006 |
|
|
|
116,820 |
|
|
|
46,677 |
|
Net income |
|
$ |
65,080 |
|
|
$ |
104,422 |
|
|
$ |
468,134 |
|
|
$ |
396,917 |
|
|
|
|
|
|
|
|
|
|
Basic earnings per common
share |
|
$ |
1.71 |
|
|
$ |
2.75 |
|
|
$ |
12.26 |
|
|
$ |
10.48 |
|
Diluted earnings per common
share |
|
$ |
1.68 |
|
|
$ |
2.69 |
|
|
$ |
12.03 |
|
|
$ |
10.25 |
|
|
|
|
|
|
|
|
|
|
Basic weighted average common
shares |
|
|
38,092 |
|
|
|
38,008 |
|
|
|
38,194 |
|
|
|
37,864 |
|
Diluted weighted average common
shares |
|
|
38,784 |
|
|
|
38,820 |
|
|
|
38,898 |
|
|
|
38,736 |
|
|
|
|
|
Consolidated Balance
Sheets (Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(In thousands) |
|
August 31, 2023 |
|
|
August 31, 2022 |
ASSETS |
|
|
|
|
|
Cash and cash equivalents |
|
$ |
425,444 |
|
$ |
503,273 |
Investments |
|
|
32,210 |
|
|
33,219 |
Accounts receivable, net of reserves of $7,769 at August 31, 2023
and $2,776 at August 31, 2022 |
|
|
237,665 |
|
|
204,102 |
Prepaid taxes |
|
|
— |
|
|
38,539 |
Prepaid expenses and other current assets |
|
|
55,060 |
|
|
91,214 |
Total current assets |
|
|
750,379 |
|
|
870,347 |
|
|
|
|
Property, equipment and leasehold improvements, net |
|
|
86,107 |
|
|
80,843 |
Goodwill |
|
|
1,008,454 |
|
|
965,848 |
Intangible assets, net |
|
|
1,859,202 |
|
|
1,895,909 |
Deferred taxes |
|
|
33,172 |
|
|
3,153 |
Lease right-of-use assets, net |
|
|
141,837 |
|
|
159,458 |
Other assets |
|
|
69,226 |
|
|
38,747 |
TOTAL ASSETS |
|
$ |
3,948,377 |
|
$ |
4,014,305 |
|
|
|
|
LIABILITIES |
|
|
|
Accounts payable and accrued expenses |
|
$ |
120,816 |
|
$ |
108,395 |
Current lease liabilities |
|
|
28,839 |
|
|
29,185 |
Accrued compensation |
|
|
112,892 |
|
|
114,808 |
Deferred revenues |
|
|
152,430 |
|
|
152,039 |
Current Taxes Payable |
|
|
15,071 |
|
|
— |
Dividends payable |
|
|
37,265 |
|
|
33,860 |
Total current liabilities |
|
|
467,313 |
|
|
438,287 |
|
|
|
|
Long-term debt |
|
|
1,612,700 |
|
|
1,982,424 |
Deferred taxes |
|
|
4,141 |
|
|
8,800 |
Deferred revenues, non-current |
|
|
3,734 |
|
|
7,212 |
Taxes payable |
|
|
34,672 |
|
|
34,211 |
Long-term lease liabilities |
|
|
198,382 |
|
|
208,622 |
Other liabilities |
|
|
6,844 |
|
|
3,341 |
TOTAL LIABILITIES |
|
$ |
2,327,786 |
|
$ |
2,682,897 |
|
|
|
|
STOCKHOLDERS’
EQUITY |
|
|
|
TOTAL STOCKHOLDERS’ EQUITY |
|
$ |
1,620,591 |
|
$ |
1,331,408 |
|
|
|
|
TOTAL LIABILITIES AND STOCKHOLDERS’
EQUITY |
|
$ |
3,948,377 |
|
$ |
4,014,305 |
|
|
|
|
Consolidated Statements of
Cash Flows (Unaudited) |
|
|
|
|
|
Twelve Months Ended |
|
|
August 31, |
(In thousands) |
|
|
2023 |
|
|
2022 |
|
CASH FLOWS FROM OPERATING
ACTIVITIES |
|
|
|
Net income |
|
$ |
468,134 |
|
$ |
396,917 |
|
Adjustments to reconcile net
income to net cash provided by operating activities |
|
|
|
Depreciation and amortization |
|
|
105,384 |
|
|
86,683 |
|
Amortization of lease right-of-use assets |
|
|
32,344 |
|
|
38,949 |
|
Stock-based compensation expense |
|
|
62,038 |
|
|
56,003 |
|
Deferred income taxes |
|
|
(42,650 |
) |
|
(8,715 |
) |
Asset impairments |
|
|
25,946 |
|
|
64,272 |
|
Changes in assets and
liabilities, net of effects of acquisitions |
|
|
|
Accounts receivable, net of reserves |
|
|
(40,103 |
) |
|
(32,980 |
) |
Accounts payable and accrued expenses |
|
|
7,393 |
|
|
13,672 |
|
Accrued compensation |
|
|
(3,431 |
) |
|
14,524 |
|
Deferred revenues |
|
|
(3,387 |
) |
|
(6,100 |
) |
Taxes payable, net of prepaid taxes |
|
|
53,991 |
|
|
(19,275 |
) |
Lease liabilities, net |
|
|
(39,704 |
) |
|
(44,544 |
) |
Other, net |
|
|
19,618 |
|
|
(35,049 |
) |
Net cash provided by operating activities |
|
|
645,573 |
|
|
524,357 |
|
|
|
|
|
CASH FLOWS FROM INVESTING
ACTIVITIES |
|
|
|
Purchases of property, equipment,
leasehold improvements and capitalized internal-use software |
|
|
(60,786 |
) |
|
(37,236 |
) |
Acquisition of businesses, net of
cash and cash equivalents acquired |
|
|
(23,593 |
) |
|
(1,981,641 |
) |
Purchases of investments |
|
|
(11,014 |
) |
|
(878 |
) |
Net cash provided by (used in) investing
activities |
|
|
(95,393 |
) |
|
(2,019,755 |
) |
|
|
|
|
CASH FLOWS FROM FINANCING
ACTIVITIES |
|
|
|
Proceeds from debt |
|
|
— |
|
|
2,238,355 |
|
Repayment of debt |
|
|
(375,000 |
) |
|
(825,000 |
) |
Payments of debt issuance
costs |
|
|
— |
|
|
(9,736 |
) |
Dividend payments |
|
|
(138,601 |
) |
|
(125,934 |
) |
Proceeds from employee stock
plans |
|
|
72,006 |
|
|
86,047 |
|
Repurchases of common stock |
|
|
(176,720 |
) |
|
(18,639 |
) |
Other financing activities |
|
|
(13,709 |
) |
|
(5,859 |
) |
Net cash provided by (used in) financing
activities |
|
|
(632,024 |
) |
|
1,339,234 |
|
|
|
|
|
Effect of exchange rate changes
on cash and cash equivalents |
|
|
4,015 |
|
|
(22,428 |
) |
Net increase (decrease) in cash
and cash equivalents |
|
|
(77,829 |
) |
|
(178,592 |
) |
Cash and cash equivalents at
beginning of period |
|
|
503,273 |
|
|
681,865 |
|
Cash and cash equivalents at end of period |
|
$ |
425,444 |
|
$ |
503,273 |
|
Reconciliation of U.S. GAAP Results to Adjusted Financial
Measures
Financial measures in accordance with U.S. GAAP,
including revenues, operating income and margin, net income,
diluted EPS and cash provided by operating activities, have been
adjusted below. FactSet uses these adjusted financial measures both
in presenting its results to stockholders and the investment
community and in its internal evaluation and management of the
business. The Company believes that these adjusted financial
measures and the information they provide are useful to investors
because they permit investors to view the Company’s performance
using the same tools that management uses to gauge progress in
achieving its goals. Adjusted measures may also facilitate
comparisons to FactSet’s historical performance.
Revenues
The table below provides a reconciliation of revenues to
adjusted revenues and organic revenues.
(Unaudited) |
|
Three Months Ended |
|
|
Twelve Months Ended |
|
|
|
August 31, |
|
|
August 31, |
|
(In
thousands) |
|
|
2023 |
|
|
2022 |
Change |
|
|
2023 |
|
|
2022 |
Change |
Revenues |
|
$ |
535,797 |
|
$ |
499,297 |
7.3 |
% |
|
$ |
2,085,508 |
|
$ |
1,843,892 |
13.1 |
% |
Deferred revenues fair value adjustment (a) |
|
|
— |
|
|
— |
|
|
|
— |
|
|
25 |
|
Adjusted revenues |
|
|
535,797 |
|
|
499,297 |
7.3 |
% |
|
|
2,085,508 |
|
|
1,843,917 |
13.1 |
% |
Acquired revenues (b) |
|
|
(128 |
) |
|
— |
|
|
|
(95,953 |
) |
|
— |
|
Currency impact (c) |
|
|
(445 |
) |
|
— |
|
|
|
5,398 |
|
|
— |
|
Organic revenues |
|
$ |
535,224 |
|
$ |
499,297 |
7.2 |
% |
|
$ |
1,994,953 |
|
$ |
1,843,917 |
8.2 |
% |
(a) The amortization effect of purchase accounting adjustment on
the fair value of acquired deferred revenue.
(b) Removes acquisition-related revenue recognized in the
current fiscal quarter and year in which the comparable prior year
period predated the acquisition(s).
(c) The impact from foreign currency movements over the past 12
months.
Non-GAAP Financial MeasuresThe table below
provides a reconciliation of operating income, operating margin,
net income and diluted EPS to adjusted operating income, adjusted
operating margin, adjusted net income, EBITDA and adjusted diluted
EPS.
|
|
Three Months Ended |
|
Twelve Months Ended |
|
|
|
August 31, |
|
August 31, |
|
(dollar
amounts in thousands, except per share data) |
|
|
2023 |
|
|
2022 |
|
% Change |
|
2023 |
|
|
2022 |
|
% Change |
Operating income |
|
$ |
117,103 |
|
$ |
132,219 |
|
(11.4 |
)% |
$ |
630,207 |
|
$ |
475,482 |
|
32.5 |
% |
Deferred revenues fair value
adjustment |
|
|
— |
|
|
— |
|
|
|
|
— |
|
|
25 |
|
|
Intangible asset
amortization |
|
|
18,131 |
|
|
18,210 |
|
|
|
|
71,503 |
|
|
49,122 |
|
|
Asset Impairments (a) |
|
|
20,327 |
|
|
— |
|
|
|
|
20,327 |
|
|
62,205 |
|
|
Restructuring / severance |
|
|
18,128 |
|
|
(332 |
) |
|
|
|
19,879 |
|
|
9,975 |
|
|
Contingent Liability |
|
|
6,239 |
|
|
3,610 |
|
|
|
|
6,239 |
|
|
3,610 |
|
|
Business acquisition /
integration costs (b) |
|
|
206 |
|
|
3,152 |
|
|
|
|
7,033 |
|
|
20,608 |
|
|
Transformation costs (c) |
|
|
— |
|
|
621 |
|
|
|
|
— |
|
|
3,368 |
|
|
Adjusted operating income |
|
$ |
180,134 |
|
$ |
157,480 |
|
14.4 |
% |
$ |
755,188 |
|
$ |
624,395 |
|
20.9 |
% |
Operating margin |
|
|
21.9 |
% |
|
26.5 |
% |
|
|
|
30.2 |
% |
|
25.8 |
% |
|
Adjusted operating margin (d) |
|
|
33.6 |
% |
|
31.5 |
% |
|
|
|
36.2 |
% |
|
33.9 |
% |
|
|
|
|
|
|
|
|
|
|
Net income |
|
$ |
65,080 |
|
$ |
104,422 |
|
(37.7 |
)% |
$ |
468,134 |
|
$ |
396,917 |
|
17.9 |
% |
Deferred revenues fair value
adjustment |
|
|
— |
|
|
— |
|
|
|
|
— |
|
|
22 |
|
|
Intangible asset
amortization |
|
|
14,496 |
|
|
15,617 |
|
|
|
|
59,422 |
|
|
43,266 |
|
|
Asset Impairments (a) |
|
|
16,251 |
|
|
— |
|
|
|
|
16,893 |
|
|
54,789 |
|
|
Restructuring / severance |
|
|
14,493 |
|
|
(285 |
) |
|
|
|
16,520 |
|
|
8,786 |
|
|
Contingent Liability |
|
|
4,988 |
|
|
3,096 |
|
|
|
|
5,185 |
|
|
3,180 |
|
|
Business acquisition /
integration costs (b) |
|
|
165 |
|
|
2,703 |
|
|
|
|
5,845 |
|
|
18,151 |
|
|
Transformation costs (c) |
|
|
— |
|
|
533 |
|
|
|
|
— |
|
|
2,967 |
|
|
Income tax items |
|
|
(1,917 |
) |
|
(4,574 |
) |
|
|
|
(6,009 |
) |
|
(7,799 |
) |
|
Adjusted net income (e) |
|
$ |
113,556 |
|
$ |
121,512 |
|
(6.5 |
)% |
$ |
565,990 |
|
$ |
520,279 |
|
8.8 |
% |
|
|
|
|
|
|
|
|
|
Net income |
|
|
65,080 |
|
|
104,422 |
|
(37.7 |
)% |
|
468,134 |
|
|
396,917 |
|
17.9 |
% |
Interest expense |
|
|
16,691 |
|
|
15,580 |
|
|
|
|
66,319 |
|
|
35,697 |
|
|
Income taxes |
|
|
43,229 |
|
|
12,006 |
|
|
|
|
116,820 |
|
|
46,677 |
|
|
Depreciation and amortization
expense |
|
|
26,703 |
|
|
26,506 |
|
|
|
|
105,384 |
|
|
86,683 |
|
|
EBITDA |
|
$ |
151,703 |
|
$ |
158,514 |
|
(4.3 |
)% |
$ |
756,657 |
|
$ |
565,974 |
|
33.7 |
% |
Non-recurring non-cash
expenses |
|
|
20,504 |
|
|
— |
|
|
|
|
20,963 |
|
|
62,205 |
|
|
Adjusted EBITDA |
|
$ |
172,207 |
|
$ |
158,514 |
|
8.6 |
% |
$ |
777,620 |
|
$ |
628,179 |
|
23.8 |
% |
|
|
|
|
|
|
|
|
|
Diluted earnings per common
share |
|
$ |
1.68 |
|
$ |
2.69 |
|
(37.5 |
)% |
$ |
12.03 |
|
$ |
10.25 |
|
17.4 |
% |
Deferred revenues fair value
adjustment |
|
|
— |
|
|
— |
|
|
|
|
— |
|
|
0.00 |
|
|
Intangible asset
amortization |
|
|
0.38 |
|
|
0.41 |
|
|
|
|
1.53 |
|
|
1.11 |
|
|
Asset Impairments (a) |
|
|
0.42 |
|
|
— |
|
|
|
|
0.43 |
|
|
1.41 |
|
|
Restructuring / severance |
|
|
0.37 |
|
|
(0.01 |
) |
|
|
|
0.43 |
|
|
0.23 |
|
|
Contingent Liability |
|
|
0.13 |
|
|
0.08 |
|
|
|
|
0.13 |
|
|
0.08 |
|
|
Business acquisition /
integration costs (b) |
|
|
0.00 |
|
|
0.07 |
|
|
|
|
0.15 |
|
|
0.47 |
|
|
Transformation costs (c) |
|
|
— |
|
|
0.01 |
|
|
|
|
— |
|
|
0.08 |
|
|
Income tax items |
|
|
(0.05 |
) |
|
(0.12 |
) |
|
|
|
(0.15 |
) |
|
(0.20 |
) |
|
Adjusted diluted earnings per common share (e) |
|
$ |
2.93 |
|
$ |
3.13 |
|
(6.4 |
)% |
$ |
14.55 |
|
$ |
13.43 |
|
8.3 |
% |
Weighted average common shares
(Diluted) |
|
|
38,784 |
|
|
38,820 |
|
|
|
|
38,898 |
|
|
38,736 |
|
|
(a) We reclassified Real estate charges to Asset
impairments in the Non-GAAP Financial Measures to conform to
current year's presentation. Asset impairments primarily related to
impairment charges of lease right-of-use assets and property,
equipment and leasehold improvements associated with vacating
certain leased office space.
(b) Related to acquisition and integration costs
of the CGS acquisition.
(c) Primarily related to professional fees
associated with the ongoing multi-year investment plan.
(d) Adjusted operating margin is calculated as
adjusted operating income divided by adjusted revenues as shown in
the revenues table above.
(e) For purposes of calculating Adjusted net
income and Adjusted diluted earnings per share, all adjustments for
the three months ended August 31, 2023 and August 31,
2022 were taxed at an adjusted tax rate of 20.1% and 12.3%,
respectively. The twelve months ended August 31, 2023 and
August 31, 2022 were taxed at an adjusted tax rate of 16.9%
and 11.9%, respectively.
Business Outlook Operating Margin, Net Income and
Diluted EPS
(Unaudited) |
|
|
|
|
|
Annual Fiscal 2024 Guidance |
(In millions, except per share
data) |
|
Low end of range |
High end of range |
Revenues |
|
$ |
2,210 |
|
$ |
2,230 |
|
Operating income |
|
$ |
732 |
|
$ |
747 |
|
Operating margin |
|
|
33.1 |
% |
|
33.5 |
% |
Intangible asset
amortization |
|
|
70 |
|
|
71 |
|
Adjusted operating income |
|
$ |
802 |
|
$ |
818 |
|
Adjusted operating margin (a) |
|
|
36.3 |
% |
|
36.7 |
% |
|
|
|
|
Net income |
|
$ |
550 |
|
$ |
569 |
|
Intangible asset
amortization |
|
|
60 |
|
|
59 |
|
Discrete tax items |
|
|
(4 |
) |
|
(3 |
) |
Adjusted net income |
|
$ |
606 |
|
$ |
625 |
|
|
|
|
|
Diluted earnings per common
share |
|
$ |
14.20 |
|
$ |
14.70 |
|
Intangible asset
amortization |
|
|
1.54 |
|
|
1.53 |
|
Discrete tax items |
|
|
(0.09 |
) |
|
(0.08 |
) |
Adjusted diluted earnings per common share |
|
$ |
15.65 |
|
$ |
16.15 |
|
(a) Adjusted operating margin
is calculated as adjusted operating income divided by adjusted
revenues as shown in the organic revenues table above.
Free Cash Flow
(Unaudited) |
|
Three Months Ended |
|
Twelve Months Ended |
|
|
|
August 31, |
|
August 31, |
|
(In
thousands) |
|
|
2023 |
|
|
2022 |
|
Change |
|
2023 |
|
|
2022 |
|
Change |
Net Cash Provided for Operating Activities |
|
$ |
175,911 |
|
$ |
147,212 |
|
|
$ |
645,573 |
|
$ |
524,357 |
|
|
Less: purchases of property,
equipment, leasehold improvements and capitalized internal-use
software |
|
|
(19,606 |
) |
|
(11,065 |
) |
|
|
(60,786 |
) |
|
(37,236 |
) |
|
Free Cash Flow |
|
$ |
156,305 |
|
$ |
136,147 |
|
14.8 |
% |
$ |
584,787 |
|
$ |
487,121 |
|
20.0 |
% |
Supplementary Schedules of Historical ASV by
Client Type
The following table presents the percentages and
growth rates of organic ASV by client type, excluding the impact of
currency movements, and may be useful to facilitate historical
comparisons. Organic ASV excludes acquisitions and dispositions
completed within the last 12 months and the effects of foreign
currency movements. The numbers below do not include professional
services.
|
Q4'23 |
Q3'23 |
Q2'23 |
Q1'23 |
Q4'22 |
Q3'22 |
Q2'22 |
Q1'22 |
% of ASV from buy-side clients |
81.8 |
% |
82.1 |
% |
82.8 |
% |
82.8 |
% |
82.9 |
% |
83.7 |
% |
83.6 |
% |
83.1 |
% |
% of ASV from sell-side
clients |
18.2 |
% |
17.9 |
% |
17.2 |
% |
17.2 |
% |
17.1 |
% |
16.3 |
% |
16.4 |
% |
16.9 |
% |
|
|
|
|
|
|
|
|
|
ASV Growth rate from buy-side
clients |
6.9 |
% |
7.3 |
% |
8.1 |
% |
8.0 |
% |
8.5 |
% |
9.6 |
% |
8.4 |
% |
8.5 |
% |
ASV Growth rate from sell-side
clients |
9.3 |
% |
12.3 |
% |
15.8 |
% |
14.4 |
% |
13.8 |
% |
12.9 |
% |
12.6 |
% |
13.2 |
% |
The following table presents the calculation of organic ASV plus
professional services. (Details may not sum to total due to
rounding)
(In
millions) |
Q4'23 |
As reported ASV plus Professional Services (a) |
$ |
2,174.6 |
|
Currency impact (b) |
|
0.5 |
|
Acquisition ASV (c) |
|
— |
|
Organic ASV plus Professional
Services |
$ |
2,175.1 |
|
Organic ASV plus Professional
Services growth rate |
|
7.1 |
% |
(a) Includes $22.7 million in professional
services as of August 31, 2023.
(b) The impact of foreign currency
movements.
(c) ASV from acquisitions completed within the
last 12 months.
FactSet Research Systems (NYSE:FDS)
Gráfico Histórico do Ativo
De Mai 2024 até Jun 2024
FactSet Research Systems (NYSE:FDS)
Gráfico Histórico do Ativo
De Jun 2023 até Jun 2024