Good morning. My name is Kanisha and I will be your conference facilitator. At this time, I would like to welcome everyone to the Broadridge Financial Solutions Fourth Quarter and Fiscal 2012 Earnings Conference Call. I would like to inform you that this call is being recorded and that all lines have been placed on mute to prevent any background noise. There will be a question-and-answer period after the speakers' remarks. Please try to limit your questions to one per participant. I would like to turn the conference over to Rick Rodick, Treasurer and Vice President of Investor Relations. Please go ahead, Sir.

Thank you. Good morning, everyone, and welcome to the Broadridge quarterly earnings call and webcast for the fourth quarter and fiscal year 2012. This morning I'm here with Rich Daly, Chief Executive Officer of Broadridge; and Dan Sheldon, Chief Financial Officer of Broadridge. I'm sure by now everyone has had the opportunity to review the earnings release we issued this morning. The news release and slide presentation that accompany today's earnings call and webcast can be found on the investor relations homepage of our website at broadridge.com. During today's conference call, we'll discuss some forward-looking statements regarding Broadridge that involve risks. These risks are summarized here on slide number one. We encourage participants to refer to our SEC filings, including our Annual Report on Form 10-K for a complete discussion of forward-looking statements and the risk factors faced by our business. Before we begin, I'd like to point out to everyone that as a result of the Penson transaction we closed in the fourth quarter fiscal year 2010, the clearing business is now shown as discontinued operations and our remaining outsourcing business is included in the Securities Processing Solutions segment. Also, as a result of the reporting treatment of the Penson transaction, the financial results discussed today will address continuing operations unless otherwise stated. Our non-GAAP results exclude the impact of the Penson charges, IBM migration costs and restructuring charges. These one-time costs are significant and we believe the non-GAAP information provides investors with a more complete understanding of Broadridge underlying operating results. Now, let's turn to slide number two and review today's agenda. Rich Daly will start today's call with his opening remarks and will provide you with a summary of the financial highlights for the fourth quarter and fiscal year 2012, followed by discussion of a few key topics. Dan Sheldon will then review the fourth quarter fiscal year 2012 financial results in further detail. Rich will then return and provide his overall summaries and closing thoughts before we head into the question-and-answering part of the call. Now please turn to slide three and I'll turn the call over to Rich Daly. Rich?

Thanks, Rick. Good morning, everyone. This morning as part of my opening remarks, I'll talk about the following topics. First, I'll start with an overview of our fiscal year 2012 financial highlights and then I'll provide you with an update on the Penson transition followed by a discussion of our closed sales performance. Next, I will provide you with a brief update on our acquisitions and then I will discuss our fiscal year 2013 guidance. After Dan provides you more of the financial details, I'll wrap it up with my closing comments. Let's start on slide four, our fiscal year 2012 financial highlights. Overall, I'm satisfied with our fiscal year 2012 non-GAAP financial highlights. Revenues were up, a very healthy 11% for the year. The recurring revenue increase was a result of net new business, internal growth, acquisitions and 99% client revenue retention. Approximately 50% of the growth was organic and 50% was related to our recent acquisitions. I am very pleased with our strong recurring revenue closed sales results due to a greater than 60% increase in closed sales of $5 million per deal, which grew in total to $108 million in fiscal year 2012. I will discuss how we achieved these strong sales results to our increased product offerings in a few minutes. The revenue was up 6% as event-driven and distribution revenues were essentially flat with fiscal year 2011 results. I am satisfied with our non-GAAP diluted earnings per share results. They were up 13% to $1.55 per share for fiscal year 2012. This increase was primarily driven by higher revenues and our continued focus on cost containment. Our non-GAAP to GAAP adjustments to our results consisted of Penson impairment charges, IBM data center migration costs and some restructuring. The Penson charges are related to the cost…

Thanks, Rich. Let me turn to slide nine, the revenue growth drivers and the EBIT margin. You can note on the far right in blue, you can see we're providing the guidance as Rich just mentioned of 3% to 4% for total consolidated revenue growth and by the way again 4% to 7% for the recurring, because as you will see that I'll walk you through, it's all coming from the recurring. We expect to get four to five points of growth from sales, or 70% is already sold and in the process of being converted. We are still expecting a client revenue loss rate of about 1%. The reduced revenue from the Penson business is about 1 point in revenue, and it is netted into internal growth and that's why you see 0% growth in this line. We do expect to see some improvement in stock record positions and trade volumes at the higher end of our guidance, which I will go into more detail when I review with your our SPS and ICS on the next two pages. Acquisitions for the most part had hit their 12-month anniversary dates, so we are currently showing no growth coming from acquisitions. In the second bullet at the bottom, we point out that acquisitions since then collectively represent approximately 10% of our total revenues, 7% of our EBIT and 10% of our EBITDA. Given that we expect to be acquisitive in the future, we are looking at ways to bring greater transparency to the cash margin benefit, or EBITDA these acquisitions provide by showing margins with and without acquired intangible amortization. The EBIT margins below include approximately $22 million in intangible amortization, expense, which has a negative impact to EBIT margins of approximately 100 basis points and $0.11 per share impact…

Thanks, Dan. Please turn to page 12 for my summary wrap up. I am satisfied with our non-GAAP operating results for fiscal year 2012. Recurring revenue was 11% and total revenues were up 6% as a result of strong recurring revenues driven by net new business, internal growth, acquisitions and excellent client retention. Event-driven revenues were flat with fiscal year 2011. We also had very good recurring revenue closed sales of $120 million due to the growing success of our emerging and acquired products. As I said earlier, I am not pleased with the new Apex agreement as a result of the Penson transaction and that it will have a negative impact on our earnings. This was the right long-term decision for Broadridge and its shareholders. Outsourcing remains a key strategy and is a large component of our sales pipeline. I am confident in the future growth of our outsourcing business. Strategically, we believe that our outsourcing assets will position Broadridge to pursue new financial service opportunities. The business that we spun-off five years ago was very different from our business today. In the past, we were generally relying on stock record growth, trade growth and event-driven revenues, but today the driver that has enabled us to perform through the market downturn has been product, and a lot more of them. Therefore, we maintain our confidence in the future, but it is not because we are banking on stock record growth, trade growth or event-driven revenues returning. It's all about new and enhanced product, increasing brand strength and Broadridge's ability to sell and execute to the new needs of our marketplace. We have a broader product portfolio and more potential right now than we've ever had in our history. We have a sales plan that gives us multiple ways to…

(Operator Instructions). Your first question comes from David Togut from Evercore Partners.

Rich, you've characterized fiscal recurring revenue closed sales of $120 million as strong, but that's at the low end of your guidance of 1.10 to 1.50, so I really have two questions. Number one, where is sales force quota set relative to your recurring revenue closed sales guidance? Then second, if you could give us more insights into the demand environment, both for ICS and SPS, and what you are seeing in terms of unit pricing trends in both businesses.

Sure. David, I think it's a great question and I appreciate you asking me to put it context. The reason I am pleased is that we have always been dependent on a couple of large deals, at least a large deal to even get into our range, and large deals have throughout our entire history always been lumpy just because of the long-term nature of getting us closed. For us to have had an increase of 60% are what I'll call the bread-and-butter deals, the basics to the point that we have confidence in those to be able to make the range and the large deals, which we are confident will continue to happen albeit on a lumpy basis to even enhance our ability to grow revenue more so is why I was so pleased with the results for this year. Because of product, we have more control of destiny, okay? Without the dependence on the large deal, we think the large deals, when they happen, we'll make it much easier to get into the range and even take us to the higher end of range as we go forward, because of our confidence. In terms of the pricing, I would say that the pricing of the deals that we did this year were pretty much in line with the expectations that we had, and we feel good about the value proposition and we feel good about the differentiation we have of our products versus the products in the market, because, one, we're viewed as the industrial strength reliable player. Two, because the value propositions and the efficiency we bring to our client is very tangible and real.

Rich, if you could perhaps address my question on sales force quotas, are those set at the low end of your guidance or the high end? I am just trying to understand that you are setting stretched goals for the sales force. I mean are you expecting them to be at the high end of closed sales for FY'13? Are expecting big deals to actually close in FY'13, or should we expect kind of small deals singles and doubles to get you to kind of the low end of the range, but needing big deals to get more towards the high end?

David, I apologize for not picking up that part of the question. It's a great question not only for the sales force, but for management including me. The quotas are generally set higher, so even though I am saying that I am so pleased, when the proxy ultimately comes out, my quota performance versus sales is slightly below what the target would be, okay? But, at the time we set the plan up, we never anticipated the success of the deals on the $5 million and we never anticipated the increased market acceptance of our new and acquired products at the level in particularly that we achieved this year.

In answering the last piece of that which was how should you think about hitting the singles and doubles? That's pretty much in a $100 million range. Okay? Then above that is the greater than $5 million.

Your next question comes from Tien-tsin Huang from JPMorgan.

Hi, thanks. Good morning. Just wanted to ask about the visibility into the new Apex agreement and how evaluate that the $0.80 delta from the prior deal?

Okay. The way we looked at that was is that, because it's on a variable pricing and that we looked back in time like the last few quarters how they were doing as well as made some projections out there, we were able to say you know what? We think that right now when we say the $0.08 difference would more come into the high end of our guidance and then those maybe $3 million or $4 million worth are at the lower end of our guidance if there was any problem, call it, any of their volumes or revenue.

So, based on what you have seen sort of through July, what's been the sort of the run rate or the appetite of clients staying with Apex? Have you seen any big change or is it still to come?

For our visibility that we saw pretty much through June, okay? And in July, it wasn't a client retention issue that they were facing. It's like everyone out just like we're facing trade volumes and clearing.

Great. Okay. Then I just wanted to see if the retention has changed at all yet. Then just as a follow-up and just maybe can you just walk us from the prior $1.80 view that you gave us, I guess now to the mid-point of $1.70. It sounds like $0.08 is Penson. I think there were restructuring, savings as well, so what's the delta there?

The way to think about the $1.80, what we just gave you on the $0.08 was year-over-year, so at last year, okay? We had $42 million from Penson, and now I gave you the range, call it, 24 to 27 type of thing. The way to be thinking about the $1.80 was, we were anticipating $50 million from Penson, so if you just do the math, you can get down to the difference, okay? Which is 23? Right? or 53 to 27? Okay? Then most of that all fall into the bottom line, and then we also have some transitioning costs that are ongoing. This is not part of that $10 million what we're calling restructuring charge, okay? This is dollars that we agreed to, to help through a transitioning which will go on for a couple of years, and that's what makes up the difference, so what we have really said is they are somewhere between $0.10 and $0.11 of off our $1.80.

Tien-tsin, this is Rich. Given what JPMorgan does and the fact that you have a clearing business, you are probably very familiar with the challenges for projecting our business. In putting together the plan for this year, we try to anticipate some of the current challenges of the business, including clearing firms' ability to retain their client. We also did not anticipate any return of interest rates. This new transaction for us is a new economic model, because it's a percentage of revenue deal which includes interest rates as I said in my comments, and even though interest rates are at a 60-year stock low from what I understand, we have nothing in there that anticipates rates coming back during our planning period.

Okay. It's good to know. Last one for me. I guess, acquisition appetite here I know your long-term guidance you've talked about adding one or two points in tuck-ins. You are assuming zero here. Is there stuff to buy that's close? I am curious what the status is there.

Like with large deals, acquisitions fit into the same category, but it's not over until it's over, so let me refer to last year, which will give you a better view in terms of the future. I said we pursued three transaction. I was highly confident, we would have closed as we were proceeding through it, so we will not put anything into a plan until it's closed, and because of our what we believe is very high hurdle rate that we have internally for acquisitions and our really strong discipline not to back away from that, I wouldn't plan on any new deals being there until we announced to you that we have actually successfully closed them, but you should believe based on the success that we've had in doing transactions and we think the very strong contribution and impressive returns we are getting, you should believe we're working very hard to identify and close.

Your next question comes from Jim Kissane from Credit Suisse.

Rich, if you look at the $60 million to $80 million that you are assuming for SPS closed sales in fiscal '13, how much of that's coming from outsourcing and what's the margin profile on that? Just following up on that, presumably the smaller deals that you had success on in fiscal '12, they'll have somewhat higher margins than say the corporate average?

Jim, because of the large deal challenges, okay? Even the large deals we put in there, we cap the amount that we put in, so yes there would be one or two large deals, but they're not in our plan at the value we expect them to bring. It's a way hedging it. This year, the way we managed successfully through that hedge was by having more basic transactions the less than $5 million close than we would have expected to be successful at. We're building off of that success and I put that over the number that we have overall for sales next year, we're expecting 55% to 65% of the growth versus the 45% growth we had this year to come from that category.

Yes. Let me just help with just adding onto that. If you think about that number that we've just talked about, okay? Then think about this, so last year we had about just over $10 million in outsourcing and there was one large deal in there just slightly over $5 million. As we look at next year, the thinking in our numbers we are kind of giving you for guidance, they could be anywhere between $10 million and $15 million, but Rich is right. Everything we are looking at isn’t really just outsourcing alone. This is really going to be a combination of outsourcing as you think about people and technology When we think about margins, we’re still in that we'll call it 35% kind of range, blended range for that, okay? And then there’s other things that could be out there that are much larger.

Jim let me see if I can clarify what I said a little better. In my formal comments I said that organic and acquired was approximately 45% of closed sales, and that in 2013 we are expecting they will account for approximately 55% to 60% of closed sales, so if you go back at any point in time over our history and even just a couple of years ago, we did not have that confidence and momentum in that new organic and acquired product activity.

I think you said what portion of sales in fiscal '12 came from acquisitions that you made since the spin or since maybe '08?

Self-generated new products and acquired was 45%, approximately 45% of closed sales. The plan we are putting together are planned activity. Now, we’re thinking it’s going to be 55% to 60%. Let me give you an example. If we had the fortune of having multiple launch deals then it wouldn’t be because the overall sales number would be up. The organic and acquired would be a lower percentage but still come in about the same number that we're planning, the dollar amount just not the same percentage amount. That would be a great problem to have.

The question was acquisition, so let's put that in perspective of the 45% which was just under $30 million came from the acquisition. Slightly over $10 million came from the outsourcing and the rest then came from emerging product, I think that’s the right way to put it in perspective.

I don’t want to get into too much detail, but any particular acquisition accounting for disproportionate amount of their sell success?

We've had pretty good success and very close to our original plans that we put together overall across the board. The blended portfolio that’s how we’re going to be talking about it, but there is no disappointments on any of the sales. The point of the matter is, some are going to do better and lot of it has to do with two, when the deal closes because some of them are little bit larger than some of the other ones.

Okay. Rich, is it safe to assume given the new authorization that you buyback more stock in fiscal ’13 than you did in fiscal ’12?

Jim you know my position on this is that we’re never going to say before we do something what we may or may not do, but we’ll report on a very timely basis after we do it.

Got you. Thank you.

Your next question comes from Ian Zaffino from Oppenheimer

Hi. On the subject of deals, what areas you are looking at right now? From our perspective it's great to make those acquisitions versus buybacks or dividends et, cetera. You know what type of criteria you are looking at for deals or I know you talked to someone about the amortization, but what's the best way to assess how good a deal is when you first do it? Just help us out a little bit. Thanks.

Ian, without repeating, we hope transparent data we gave you on the performance of our acquisitions to-date and even breaking out the intangible amortization amount there. That we believe gives you a pretty clear view of the acquisition performance to-date, and I would tell you that we would look for additional transactions to fit in the same category. By the setting the internal rate of return hurdle rate of 20%, we believe when we identify a transaction that meets our criteria, that gives us the ability to create that level of performance. In terms of the areas both, in my wrap up and when we talked about the strategy of the business, across our Investor Communication segment where we've had transactions, access data, NewRiver, also Matrix in our expanding products in the mutual fund world, okay? Paladyne, going, expanding our Securities Processing segment into the buy-side where we believe we’re well positioned. Those segments that we are servicing, those segment that we believe will recognize as a very good vendor partner, and a very good market leader and as a very reliable and cost-effective player, it’s leveraging that brand which is what we have a very strong desire to continue, so you should expect us to go out of our natural areas, where we are a proven success company. You should expect us to look in those areas, where we can leverage our brand, leverage our distribution channel, leverage our infrastructure, leverage our sales force and have a far better hedge than buyers of the same property, because of our strength in our markets.

Your next question comes from Chris Donat of Sandler O'Neill.

One quick question on the expanded repurchase authorization. If I take the 10 million shares at current prices that's over $200 million worth of stock you would be buying back and that’s a pretty large chunk of the $225 million of projected free cash flow. I’m just trying to get the rationale for why the Board went from 6 million to 10 million. Is that really to say, hey, if we don’t do any acquisitions then that gives us the ability to buy back shares?

Chris, this is Rich. Again, when it comes to repurchases, we recognize that we have no desire to hoard cash which I said in my comments. We’ve recognize that there will not always be the opportunities we want for tuck-ins. We’ve recognized that there are appropriate times when it is opportunistic to buyback and we will absolutely consider all those factors as we analyze what's the best use of our shareholders' cash to provide greater returns to them, so we will always consider those variables and in considering those variables, having an authorization, gives us the flexibility if and when we determine that it's appropriate that the best use of our shareholders' cash at that point in time and the best opportunity to create returns for our shareholders. Beyond that, all right? I wouldn't be comfortable going into any of the dialogue that I've had with the board because I'm not looking to telegraph anything one way or the other, all right? But I will always be very timely in a call explaining exactly what happened if and when we do something and why we did it.

Yes. The only think I would add to that is let’s not forget the cash balances we have on hand as of June 30th, okay? Which is over $320 million. We want to keep in like $150 million of that and at the same time our debt capacity now, keeping to our 2 to 1, so those are all levers that we can in order to do the various thing Rich talked about, invest in the business acquired, dividends and buybacks.

Rest assured every decision that I discuss with the board and that we will ultimately execute is tied to a relentless contentment to the need to create shareholder value.

Your next question comes from Peter Heckmann from Avondale Partners

As regards the outsourcing business, can you dive it a little bit in terms of the revenue level and the expected losses post the change to Penson/Apex. Then what you're estimating in there in terms of potential future changes.

Right. The outsourcing business, when you go back to our key steps pages is what we'll call the $82 million ending last year. There is new business coming onboard as well as you know we have now the down tick from the Penson business.

One additional thing that's not specifically related to the numbers, Pete, but if you think about the market and even some of the press releases that are client who aren't live yet, have enabled us to issue with them. Schwab announced about their international offering and we anticipate that going live in the very near future. Bloomberg announced that they are going to be moving trade book on to it and we anticipate that going live in this fiscal year. Although we're not privy to all of their internal dialogues and we're not privy to their growth plans specifically both of those organizations as an example have proven track records of being market leaders in what they do, and so we're very excited about the fact that the outsourcing opportunity enabled us to enter into a relationship with those two very, very brand name organizations along with the dozen plus other clients that we've entered into the relationship with. Although it's not in the plan to say they are all going to drive inherent growth, okay? As we go forward, I would be stunned if the transactions we entered into with just all these very strong organizations, there are so many strong organization in the outsourcing space, didn’t create inherent growth beyond what we are going forward.

Yes. Just kind of going back on the perspective of kind of things we've talked about a lot. I told you add just over $80 million, obviously it is around $20 million as well as the new business that we've been talking about this in the backlog et, cetera should drive us above $70 million. We did say that by the way with no huge deals that we should be doing 10 to 15 in sales next year, but what I will tell you is in our pipeline the largest amount of activity that we're excited about is in the outsourcing space. Let's see if we land it, but the point of the matter is, I haven't seen as high of a level of interest in the pipeline in any of the past years as I have seen to where we are today.

Okay. That's great. Maybe we are not specifically drawing a roadmap, we get an indication that while that business may have fallen back to generating, operating losses. We should be in a good position to get it back into the black and potentially reach those target margins over a reasonable period of time?

One of the things that we are dealing with is the difficulty in projecting these mega large deals Dan's comments support the formal, comments that I made about where the most significant opportunities, we have in the pipeline are I'll also say that the one product that consistently enables Broadridge and myself to not only have meaningful dialogue in the C suite, but at the absolute highest level being the CEO in the C suite is the outsourcing opportunity.

Great. Then just one further question on the event-driven piece. I guess I am little bit unclear if there change in control at a mutual fund firm does that automatically then require some proxy activity, or does it kind of dependent on how that change of control goes when there is going to be fund that emerge?

It does depend on how it goes, but in the majority of cases, historically a change of control require shareholder approval and things that require shareholder approval have to involve Broadridge because we handle the vast, vast majority of the street side and of course because of our strong technology we win a very high percentage of the registered site as well, and we certainly intend to continue that.

Your next question comes from Leo [Schmidt].

Hello, gentlemen. I wanted to clear up something in mind here. You were saying that you had a very large percentage last year of about 45% of the under the $5 million deals. I thought I heard you say lot of that is having to do with your new should I say product offerings that have come with the acquisitions, and I wanted to make sure that's the case If it is, is this changing some of the character of your growth, meaning that you’re going to be able to have a lot more the smaller, possibly more profitable under $5 million opportunities that will just drive growth may be in a more consistent and profitable way.

Leo, I am delighted you are asking for clarification, because what you're really leaving with is a key takeaway that we were hoping you would leave with which is, because of our success in organic and acquired products, okay? We were able to have a strong fourth quarter in sales and we were able to get further into the range than we would have anticipated getting into without a large deal. Going forward, in our plan for next year, yes. We are intending to continue that. We have very detailed sales plans by product, by business unit, by sales head, by sales individuals which reconciles back to all of this and so we are expecting Broadridge overall to be able to sell more of these organic we develop new and acquired products as we go forward into fiscal '13.

As I think about this as conceptually, this should give you a more consistent growth rate meaning that you can add these lumpy outsourcing deals that would accelerate the growth rate, but you are not necessarily counting on that as you move forward. Am I putting words into your mouth there or is that what's the message I was supposed to be taking away?

Leo, I like the way you stated that, and because sales can never be something as guaranteed, all right? I said specifically that the one takeaway I'd like you to leave the call with is that irrespective of our markets and clients challenges going to right what you said? Broadridge has proven that we can create and acquire products that will grow revenue. The proof statement this year, from the 60% increase we had in sales of less than $5 million per deal is exactly what you're referring to. We believe that going forward we can maintain that momentum and have at least to the low end of the range more control of destiny in achieving our sales performance than we've historically had.

(Operator Instructions). Thank you. There are no further questions at this time. I'll now turn the call back to Mr. Daly.

Thanks, Kanisha. Well, thank you for your active participation today. It is truly sincerely appreciated. Dan, Rick and I are going to choose to have a great day, but I will tell you we are also going to choose to continue on the path to find multiple ways to create the shareholder value you deserve. Thanks so much.

This concludes today's Broadridge Financial Solutions Incorporated fourth quarter and fiscal year 2012 earnings conference call. Thank you for your participation. You may now disconnect.