FactSet ("FactSet" or the “Company”) (NYSE:FDS) (NASDAQ:FDS), a
global financial digital platform and enterprise solutions
provider, today announced results for its third quarter ended
May 31, 2023.
Third Quarter Fiscal 2023 Highlights
-
GAAP revenues increased 8.4%, or $41.1 million, to
$529.8 million for the third quarter of fiscal 2023 compared with
$488.8 million for the same period in fiscal 2022. The increase was
primarily due to 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 8.5% to $530.3 million
during the third quarter of fiscal 2023 from the prior year
period.
- Annual
Subscription Value (ASV) plus professional services was
$2.1 billion at May 31, 2023, compared with $2.01 billion at
May 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 $2.1
billion at May 31, 2023, up $156.6 million from the prior year
at a growth rate of 8.0%.
- Organic
ASV plus professional services increased $21.2 million
over the last three months. The primary contributor to this growth
was Analytics & Trading solutions. Please see the “ASV +
Professional Services” section of this press release for
details.
- GAAP
operating margin increased to 32.5% compared with 19.9%
for the prior year, driven by the lapping of the previous year's
impairment charge of $49 million and $12 million of expenses
related to the acquisition of CUSIP Global Services (CGS). Adjusted
operating margin decreased to 36.0% compared with 36.6% in the
prior year period due to higher personnel costs and technology
expenses, partially offset by lower third-party content costs,
lower facilities expenses, and favorable impact from foreign
exchange.
- GAAP
diluted earnings per share (EPS) increased 79.3% to $3.46
compared with $1.93 for the same period in fiscal 2022, primarily
due to lapping the prior year's non-recurring items, partially
offset by increased income taxes. Adjusted diluted EPS increased
0.8% to $3.79, compared with $3.76 for the prior year period,
driven by higher revenues mostly offset by higher income
taxes.
-
Adjusted EBITDA increased to $205.3 million, up
15.6% for the third quarter of fiscal 2023 compared with $177.6
million for the same period in fiscal 2022, driven by higher
operating income and the lapping of expenses related to the CGS
acquisition.
- 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 third quarter of fiscal 2023, FactSet paid $62.5
million towards the term loan, and as of May 31, 2023, FactSet
had made a total of $562.5 million in total term loan
payments.
- The Company’s effective tax
rate for the third quarter of fiscal 2023 increased to
16.9% compared with 12.2% for the three months ended May 31,
2022, primarily due to lower stock option exercises.
- FactSet updated
its annual outlook for fiscal 2023. Please see the "Annual Business
Outlook" section of this press release for details.
“We are pleased with our third-quarter results,
which reflect the resiliency of our business in an uncertain
environment,” said Phil Snow, FactSet CEO. “As technology rapidly
evolves, we remain confident in our ability to innovate and capture
market share as we meet the needs of our clients.”
Key Financial Measures*
(Condensed and Unaudited) |
Three Months Ended |
|
|
May 31, |
|
(In
thousands, except per share data) |
|
2023 |
|
|
2022 |
|
Change |
Revenues |
$ |
529,811 |
|
$ |
488,751 |
|
8.4 |
% |
Organic revenues |
$ |
530,321 |
|
$ |
488,752 |
|
8.5 |
% |
Operating income |
$ |
171,959 |
|
$ |
97,254 |
|
76.8 |
% |
Adjusted operating income |
$ |
190,932 |
|
$ |
179,066 |
|
6.6 |
% |
Operating margin |
|
32.5 |
% |
|
19.9 |
% |
|
Adjusted operating margin |
|
36.0 |
% |
|
36.6 |
% |
|
Net income |
$ |
134,663 |
|
$ |
74,910 |
|
79.8 |
% |
Adjusted net income |
$ |
147,667 |
|
$ |
145,794 |
|
1.3 |
% |
Adjusted EBITDA |
$ |
205,284 |
|
$ |
177,610 |
|
15.6 |
% |
Diluted EPS |
$ |
3.46 |
|
$ |
1.93 |
|
79.3 |
% |
Adjusted diluted EPS |
$ |
3.79 |
|
$ |
3.76 |
|
0.8 |
% |
* See reconciliation of U.S. GAAP to adjusted key financial
measures in the back of this press release.
“Our continued cost management efforts are on
track,” said Linda Huber, FactSet CFO. “As a result, we have
increased our fiscal 2023 adjusted operating margin guidance by 100
basis points to 35% -36%, with continued high single-digit ASV
growth and double-digit EPS growth.”
Annual Subscription Value (ASV) + Professional
Services
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 $2,120.1
million at May 31, 2023, compared with $1,965.6 million at
May 31, 2022. Organic ASV plus professional services was
$2,120.2 million at May 31, 2023, up $156.6 million from the
prior year at a growth rate of 8.0%. Organic ASV, which excludes
the effects of acquisitions and dispositions completed within the
last 12 months and foreign currency movements, plus professional
services, increased $21.2 million over the last three months.
Buy-side and sell-side organic ASV growth rates
for the third quarter of fiscal 2023 were 7.3% and 12.3%,
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 $1,344.7
million compared with ASV in the prior year period of $1,245.2
million. Organic ASV increased 8.0% to $1,344.7 million. Americas
revenues for the quarter increased to $337.7 million compared with
$309.7 million in the third 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
9.0%.
ASV from the EMEA region was $541.3 million
compared with ASV in the prior year period of $504.0 million.
Organic ASV increased 7.4% to $540.7 million. EMEA revenues were
$138.0 million compared with $128.3 million in the third 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 7.5%.
ASV from the Asia Pacific region was $209.8
million compared with ASV in the prior year period of $192.0
million. Organic ASV increased 10.5% to $210.5 million. Asia
Pacific revenues were $54.1 million compared with $50.7 million in
the third 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 7.9%.
Segment ASV does not include professional
services, which totaled $24.3 million at May 31, 2023.
Operational Highlights – Third Quarter Fiscal 2023
- Client count as
of May 31, 2023 was 7,770, a net increase of 40 clients in the
past three months, primarily driven by an increase in corporate and
wealth management clients. The count includes clients with ASV of
$10,000 and more.
- User count
increased by 1,382 to 187,845 in the past three months, primarily
driven by an increase in asset management, asset owner, and wealth
management users.
- Annual ASV
retention was greater than 95%. When expressed as a percentage of
clients, annual retention was 92%.
- Employee count
was 12,072 as of May 31, 2023, up 12.9% 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. 65% of our employees are in our
Centers of Excellence.
- Net cash
provided by operating activities increased to $218.6 million
compared with $192.0 million for the third quarter of fiscal 2022,
primarily related to higher net income as well as the timing of
income tax payments, partially offset by a higher bonus payout in
the current year. Quarterly free cash flow increased to $192.6
million compared with $176.6 million a year ago, an increase of
9.1%, driven by cash generated from working capital changes as well
as the timing of income tax payments.
- A quarterly
dividend of $37.4 million, or $0.98 per share, was paid on
June 15, 2023, to holders of record of FactSet’s common stock
at the close of business on May 31, 2023. This represented a
10% increase in the regular quarterly dividend from the $0.89 per
share paid in the previous quarter and marks the twenty-fourth
consecutive year the Company has increased dividends on a stock
split-adjusted basis.
- The Company
announced the appointment of Elisha Wiesel to its Board of
Directors. Wiesel is a founding partner and the Chief Risk Officer
of ClearAlpha Technologies, an emerging investment manager.
Previously, Wiesel spent 25 years at Goldman Sachs, including 15
years as a partner, innovating in software, markets, and risk
management. He also served as Chief Risk Officer of the Securities
Division for seven years and as Chief Information Officer for three
years.
Share Repurchase Program
FactSet repurchased 165,950 shares of its common
stock for $67.1 million at an average price of $404.29 during the
third quarter under the Company’s existing share repurchase
program. As of May 31, 2023, $114.2 million is available for
share repurchases under this program. Additionally, on June 20,
2023, the Board of Directors of FactSet approved a new share
repurchase authorization of up to $300 million, which will be
available on September 1, 2023.
Annual Business Outlook
FactSet is updating its outlook for fiscal 2023
from its previous guidance provided on March 22, 2023. 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 2023 Expectations
- Organic ASV
plus professional services growth is expected to be at the lower
end of the range of $145 million to $175 million during fiscal
2023.
- GAAP revenues
are expected to be at the lower end of the range of $2,080 million
to $2,100 million.
- GAAP operating
margin is expected to be in the range of 29.0% to 30.0%, a 50-basis
point decrease at the midpoint from the prior guidance of 29.5% -
30.5%
- Adjusted
operating margin is expected to be in the range of 35.0% to 36.0%,
a 100-basis point increase at the midpoint from the prior guidance
of 34.0% - 35.0%
- FactSet's
annual effective tax rate is expected to be in the range of 14.0%
to 15.0%, a 50-basis point increase at the midpoint from the prior
guidance of 13.5% - 14.5%
- GAAP diluted
EPS is expected to be in the range of $12.25 to $12.65, a $0.20
decrease at the midpoint from the prior guidance of $12.45 -
$12.85
- Adjusted
diluted EPS is expected to be in the range of $14.75 to $15.15, a
$0.25 increase at the midpoint from the prior guidance of $14.50 -
$14.90
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 2023. Please see the
back of this press release for a reconciliation of GAAP to adjusted
metrics.
Conference Call
Third Quarter 2023 Conference Call Details
Date: |
Thursday,
June 22, 2023 |
Time: |
11:00 a.m. Eastern Time |
Participant Registration: |
FactSet Q3 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 June 22, 2023, through June
22, 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 over 7,500 global clients, including over 185,000
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&P500, we are
committed to sustainable growth and have repeatedly scored 100 on
the Human Rights Campaign® Corporate Equality Index and 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:Kendra
Brown+1.203.810.2684kbrown@factset.com
Media ContactMegan
Kovach+1.512.736.2795megan.kovach@factset.com
Consolidated Statements of Income
(Unaudited) |
|
|
|
|
|
|
Three Months Ended |
|
Nine Months Ended |
|
May 31, |
|
May 31, |
(In thousands, except per share data) |
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
Revenues |
$ |
529,811 |
|
|
$ |
488,751 |
|
|
$ |
1,549,711 |
|
|
$ |
1,344,595 |
|
Operating expenses |
|
|
|
|
|
|
|
Cost of services |
|
241,689 |
|
|
|
222,618 |
|
|
|
709,537 |
|
|
|
629,162 |
|
Selling, general and administrative |
|
115,725 |
|
|
|
119,881 |
|
|
|
325,903 |
|
|
|
309,185 |
|
Asset impairments |
|
438 |
|
|
|
48,998 |
|
|
|
1,167 |
|
|
|
62,985 |
|
Total operating expenses |
|
357,852 |
|
|
|
391,497 |
|
|
|
1,036,607 |
|
|
|
1,001,332 |
|
|
|
|
|
|
|
|
|
Operating income |
|
171,959 |
|
|
|
97,254 |
|
|
|
513,104 |
|
|
|
343,263 |
|
|
|
|
|
|
|
|
|
Other income (expense), net |
|
|
|
|
|
|
|
Interest income |
|
3,083 |
|
|
|
4,133 |
|
|
|
8,191 |
|
|
|
4,900 |
|
Interest expense |
|
(16,354 |
) |
|
|
(16,184 |
) |
|
|
(49,628 |
) |
|
|
(20,118 |
) |
Other income (expense), net |
|
3,310 |
|
|
|
77 |
|
|
|
4,978 |
|
|
|
(879 |
) |
Income before income
taxes |
|
161,998 |
|
|
|
85,280 |
|
|
|
476,645 |
|
|
|
327,166 |
|
|
|
|
|
|
|
|
|
Provision for income taxes |
|
27,335 |
|
|
|
10,370 |
|
|
|
73,591 |
|
|
|
34,671 |
|
Net income |
$ |
134,663 |
|
|
$ |
74,910 |
|
|
$ |
403,054 |
|
|
$ |
292,495 |
|
|
|
|
|
|
|
|
|
Diluted earnings per common
share |
$ |
3.46 |
|
|
$ |
1.93 |
|
|
$ |
10.35 |
|
|
$ |
7.58 |
|
Diluted weighted average common
shares |
|
38,912 |
|
|
|
38,720 |
|
|
|
38,936 |
|
|
|
38,607 |
|
Consolidated Balance
Sheets (Unaudited) |
|
|
|
|
|
|
|
(In thousands) |
May 31, 2023 |
August 31, 2022 |
ASSETS |
|
|
Cash and cash equivalents |
$ |
486,627 |
$ |
503,273 |
Investments |
|
32,151 |
|
33,219 |
Accounts receivable, net of reserves of $5,956 at May 31, 2023 and
$2,776 at August 31, 2022 |
|
237,794 |
|
204,102 |
Prepaid taxes |
|
21,566 |
|
38,539 |
Prepaid expenses and other current assets |
|
66,171 |
|
91,214 |
Total current assets |
|
844,309 |
|
870,347 |
|
|
|
Property, equipment and leasehold improvements, net |
|
81,908 |
|
80,843 |
Goodwill |
|
982,162 |
|
965,848 |
Intangible assets, net |
|
1,859,242 |
|
1,895,909 |
Deferred taxes |
|
12,041 |
|
3,153 |
Lease right-of-use assets, net |
|
156,786 |
|
159,458 |
Other assets |
|
61,462 |
|
38,747 |
TOTAL ASSETS |
$ |
3,997,910 |
$ |
4,014,305 |
|
|
|
LIABILITIES |
|
|
Accounts payable and accrued expenses |
$ |
110,282 |
$ |
108,395 |
Current lease liabilities |
|
29,600 |
|
29,185 |
Accrued compensation |
|
75,803 |
|
114,808 |
Deferred revenues |
|
147,813 |
|
152,039 |
Dividends payable |
|
37,442 |
|
33,860 |
Total current liabilities |
|
400,940 |
|
438,287 |
|
|
|
Long-term debt |
|
1,674,194 |
|
1,982,424 |
Deferred taxes |
|
6,068 |
|
8,800 |
Deferred revenues, non-current |
|
7,580 |
|
7,212 |
Taxes payable |
|
36,448 |
|
34,211 |
Long-term lease liabilities |
|
200,740 |
|
208,622 |
Other liabilities |
|
3,107 |
|
3,341 |
TOTAL LIABILITIES |
$ |
2,329,077 |
$ |
2,682,897 |
|
|
|
STOCKHOLDERS’
EQUITY |
|
|
TOTAL STOCKHOLDERS’ EQUITY |
$ |
1,668,833 |
$ |
1,331,408 |
|
|
|
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY |
$ |
3,997,910 |
$ |
4,014,305 |
Consolidated Statements of
Cash Flows (Unaudited) |
|
|
|
Nine Months Ended |
|
May 31, |
(In thousands) |
|
2023 |
|
|
2022 |
|
CASH FLOWS FROM OPERATING
ACTIVITIES |
|
|
Net income |
$ |
403,054 |
|
$ |
292,495 |
|
Adjustments to reconcile net
income to net cash provided by operating activities |
|
|
Depreciation and amortization |
|
78,681 |
|
|
60,176 |
|
Amortization of lease right-of-use assets |
|
29,245 |
|
|
32,936 |
|
Stock-based compensation expense |
|
44,365 |
|
|
40,604 |
|
Deferred income taxes |
|
(12,716 |
) |
|
(5,488 |
) |
Asset impairments |
|
1,167 |
|
|
62,985 |
|
Changes in assets and
liabilities, net of effects of acquisitions |
|
|
Accounts receivable, net of reserves |
|
(37,879 |
) |
|
(39,005 |
) |
Accounts payable and accrued expenses |
|
5,870 |
|
|
15,292 |
|
Accrued compensation |
|
(39,935 |
) |
|
(23,992 |
) |
Deferred revenues |
|
(3,861 |
) |
|
4,091 |
|
Taxes payable, net of prepaid taxes |
|
19,112 |
|
|
(18,552 |
) |
Lease liabilities, net |
|
(34,041 |
) |
|
(35,961 |
) |
Other, net |
|
36,841 |
|
|
1,343 |
|
Net cash provided by operating activities |
|
489,903 |
|
|
386,924 |
|
|
|
|
CASH FLOWS FROM INVESTING
ACTIVITIES |
|
|
Purchases of property, equipment,
leasehold improvements and capitalized internal-use software |
|
(61,421 |
) |
|
(35,950 |
) |
Acquisition of businesses, net of
cash and cash equivalents acquired |
|
— |
|
|
(1,981,641 |
) |
Purchases of investments |
|
(10,889 |
) |
|
(678 |
) |
Net cash provided by (used in) investing
activities |
|
(72,310 |
) |
|
(2,018,269 |
) |
|
|
|
CASH FLOWS FROM FINANCING
ACTIVITIES |
|
|
Proceeds from debt |
|
— |
|
|
2,238,355 |
|
Repayment of debt |
|
(312,500 |
) |
|
(700,000 |
) |
Payments of debt issuance
costs |
|
— |
|
|
(9,736 |
) |
Dividend payments |
|
(101,377 |
) |
|
(92,334 |
) |
Proceeds from employee stock
plans |
|
55,885 |
|
|
74,173 |
|
Repurchases of common stock |
|
(67,092 |
) |
|
(18,639 |
) |
Other financing activities |
|
(12,273 |
) |
|
(3,263 |
) |
Net cash provided by (used in) financing
activities |
|
(437,357 |
) |
|
1,488,556 |
|
|
|
|
Effect of exchange rate changes
on cash and cash equivalents |
|
3,118 |
|
|
(12,110 |
) |
Net increase (decrease) in cash
and cash equivalents |
|
(16,646 |
) |
|
(154,899 |
) |
Cash and cash equivalents at
beginning of period |
|
503,273 |
|
|
681,865 |
|
Cash and cash equivalents at end of period |
$ |
486,627 |
|
$ |
526,966 |
|
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 |
|
|
May 31, |
|
(In
thousands) |
|
2023 |
|
2022 |
Change |
Revenues |
$ |
529,811 |
$ |
488,751 |
8.4 |
% |
Deferred revenues fair value adjustment (a) |
|
— |
|
1 |
|
Adjusted revenues |
|
529,811 |
|
488,752 |
8.4 |
% |
Acquired revenues (b) |
|
— |
|
— |
|
Currency impact (c) |
|
510 |
|
— |
|
Organic revenues |
$ |
530,321 |
$ |
488,752 |
8.5 |
% |
(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 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.
(Unaudited) |
Three Months Ended |
|
|
May 31, |
|
(In
thousands, except per share data) |
|
2023 |
|
|
2022 |
|
Change |
Operating income |
$ |
171,959 |
|
$ |
97,254 |
|
76.8 |
% |
Deferred revenues fair value
adjustment |
|
— |
|
|
1 |
|
|
Intangible asset
amortization |
|
17,655 |
|
|
18,548 |
|
|
Restructuring / severance |
|
1,318 |
|
|
1,079 |
|
|
Real estate charges (a) |
|
— |
|
|
48,797 |
|
|
Business acquisition /
integration costs (b) |
|
— |
|
|
12,408 |
|
|
Transformation costs (c) |
|
— |
|
|
979 |
|
|
Adjusted operating income |
$ |
190,932 |
|
$ |
179,066 |
|
6.6 |
% |
Operating margin |
|
32.5 |
% |
|
19.9 |
% |
|
Adjusted operating margin (d) |
|
36.0 |
% |
|
36.6 |
% |
|
|
|
|
|
Net income |
$ |
134,663 |
|
$ |
74,910 |
|
79.8 |
% |
Deferred revenues fair value
adjustment |
|
— |
|
|
1 |
|
|
Intangible asset
amortization |
|
14,406 |
|
|
16,184 |
|
|
Restructuring / severance |
|
1,075 |
|
|
941 |
|
|
Real estate charges (a) |
|
— |
|
|
42,577 |
|
|
Business acquisition /
integration costs (b) |
|
— |
|
|
10,827 |
|
|
Transformation costs (c) |
|
— |
|
|
854 |
|
|
Income tax items |
|
(2,477 |
) |
|
(500 |
) |
|
Adjusted net income (e) |
$ |
147,667 |
|
$ |
145,794 |
|
1.3 |
% |
|
|
|
|
Net income |
$ |
134,663 |
|
$ |
74,910 |
|
|
Interest expense |
|
16,354 |
|
|
16,184 |
|
|
Income taxes |
|
27,335 |
|
|
10,370 |
|
|
Depreciation and amortization
expense |
|
26,473 |
|
|
27,349 |
|
|
EBITDA |
$ |
204,825 |
|
$ |
128,813 |
|
59.0 |
% |
Non-cash severance |
|
459 |
|
|
— |
|
|
Real estate charges |
|
— |
|
|
48,797 |
|
|
Adjusted EBITDA |
$ |
205,284 |
|
$ |
177,610 |
|
15.6 |
% |
|
|
|
|
Diluted earnings per common
share |
$ |
3.46 |
|
$ |
1.93 |
|
79.3 |
% |
Deferred revenues fair value
adjustment |
|
— |
|
|
0.00 |
|
|
Intangible asset
amortization |
|
0.36 |
|
|
0.42 |
|
|
Restructuring / severance |
|
0.03 |
|
|
0.02 |
|
|
Real estate charges (a) |
|
— |
|
|
1.10 |
|
|
Business acquisition /
integration costs (b) |
|
— |
|
|
0.28 |
|
|
Transformation costs (c) |
|
— |
|
|
0.02 |
|
|
Income tax items |
|
(0.06 |
) |
|
(0.01 |
) |
|
Adjusted diluted earnings per common share (e) |
$ |
3.79 |
|
$ |
3.76 |
|
0.8 |
% |
Weighted average common shares (Diluted) |
|
38,912 |
|
|
38,720 |
|
|
(a) 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
were taxed at the quarterly effective tax rates of 16.9% for fiscal
2023 and 12.7% for fiscal 2022.
Business Outlook Operating Margin, Net Income and
Diluted EPS
(Unaudited) |
|
|
|
Annual Fiscal 2023 Guidance |
(In millions, except per share
data) |
Low end of range |
High end of range |
Revenues |
$ |
2,080 |
|
$ |
2,100 |
|
Operating income |
$ |
603 |
|
$ |
630 |
|
Operating margin |
|
29.0 |
% |
|
30.0 |
% |
Intangible asset
amortization |
|
71 |
|
|
71 |
|
Restructuring / severance |
|
29 |
|
|
29 |
|
Real estate charges |
|
18 |
|
|
20 |
|
Business acquisition /
integration costs (a) |
|
7 |
|
|
7 |
|
Adjusted operating income |
$ |
728 |
|
$ |
756 |
|
Adjusted operating margin (b) |
|
35.0 |
% |
|
36.0 |
% |
|
|
|
Net income |
$ |
469 |
|
$ |
497 |
|
Intangible asset
amortization |
|
60 |
|
|
61 |
|
Restructuring / severance |
|
24 |
|
|
24 |
|
Real estate charges |
|
15 |
|
|
17 |
|
Business acquisition /
integration costs (a) |
|
6 |
|
|
6 |
|
Discrete tax items |
|
(7 |
) |
|
(7 |
) |
Adjusted net income |
$ |
567 |
|
$ |
598 |
|
|
|
|
Diluted earnings per common
share |
$ |
12.25 |
|
$ |
12.65 |
|
Intangible asset
amortization |
|
1.55 |
|
|
1.57 |
|
Restructuring / severance |
|
0.58 |
|
|
0.51 |
|
Real estate charges |
|
0.39 |
|
|
0.44 |
|
Business acquisition /
integration costs (a) |
|
0.15 |
|
|
0.15 |
|
Discrete tax items |
|
(0.17 |
) |
|
(0.17 |
) |
Adjusted diluted earnings per common share |
$ |
14.75 |
|
$ |
15.15 |
|
(a) Related to integration costs of the CGS
acquisition.
(b) 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 |
|
|
May 31, |
|
(In
thousands) |
|
2023 |
|
|
2022 |
|
Change |
Net Cash Provided for Operating Activities |
$ |
218,589 |
|
$ |
191,972 |
|
|
Less: purchases of property,
equipment, leasehold improvements and capitalized internal-use
software |
|
(26,005 |
) |
|
(15,404 |
) |
|
Free Cash Flow |
$ |
192,584 |
|
$ |
176,568 |
|
9.1 |
% |
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.
|
Q3'23 |
Q2'23 |
Q1'23 |
Q4'22 |
Q3'22 |
Q2'22 |
Q1'22 |
Q4'21 |
%
of ASV from buy-side clients |
82.1% |
82.8% |
82.8% |
82.9% |
83.7% |
83.6% |
83.1% |
83.2% |
% of ASV from sell-side
clients |
17.9% |
17.2% |
17.2% |
17.1% |
16.3% |
16.4% |
16.9% |
16.8% |
|
|
|
|
|
|
|
|
|
ASV Growth rate from buy-side
clients |
7.3% |
8.1% |
8.0% |
8.5% |
9.6% |
8.4% |
8.5% |
6.5% |
ASV Growth rate from sell-side
clients |
12.3% |
15.8% |
14.4% |
13.8% |
12.9% |
12.6% |
13.2% |
12.0% |
The following table presents the calculation of organic ASV plus
professional services. (Details may not sum to total due to
rounding)
(In
millions) |
Q3'23 |
As reported ASV plus Professional Services (a) |
$ |
2,120.1 |
|
Currency impact (b) |
|
0.1 |
|
Acquisition ASV (c) |
|
— |
|
Organic ASV plus Professional
Services |
$ |
2,120.2 |
|
Organic ASV plus Professional
Services growth rate |
|
8.0 |
% |
(a) Includes $24.3 million in professional
services as of May 31, 2023.
(b) The impact of foreign currency
movements.
(c) ASV from acquisitions completed within the
last 12 months.
1 Prior year Total ASV now reflects additional CGS revenues not
previously included.
FactSet Research Systems (NYSE:FDS)
Gráfico Histórico do Ativo
De Abr 2024 até Mai 2024
FactSet Research Systems (NYSE:FDS)
Gráfico Histórico do Ativo
De Mai 2023 até Mai 2024