Ladies and gentlemen, this is your operator speaking. Today's conference call will begin momentarily. You will be placed back on mute to hold until then. Thank you for your patience. Good afternoon. My name is John, and I will be your conference operator today. At this time, I would like to welcome everyone to the SS&C Technologies Holdings, Inc. fourth quarter and full year 2024 earnings call. All lines have been placed on mute to prevent background noise. After the speakers' remarks, there will be a Q&A session. If you would like to ask a question during that time, simply press star followed by the number one on your telephone keypad. If you would like to withdraw your question, simply press star one again. Thank you. I would now like to turn the call over to Chand Madakka of Investor Relations. You may now begin your conference.

Welcome, and thank you for joining us at our Q4 and full year 2024 earnings call. I'm Chand Madakka, Investor Relations at SS&C Technologies Holdings, Inc. With me today is Bill Stone, Chairman and Chief Executive Officer, Rahul Kanwar, President and Chief Operating Officer, and Brian Schell, our Chief Financial Officer. Before we get started, we need to review the Safe Harbor statement. Please note that various remarks we make today about future expectations, plans, and prospects, including the financial outlook we provide, are forward-looking statements for purposes of the Safe Harbor provisions under the Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those indicated by these forward-looking statements as a result of various important factors, including those discussed in the Risk Factors section of our most recent annual report on Form 10-K, which is on file with the SEC and can also be accessed on our website. These forward-looking statements represent our expectations only as of today, February 6, 2025. We, the company, may elect to update these forward-looking statements, but it specifically disclaims any obligation to do so. During today's call, we will be referring to certain non-GAAP financial measures. A reconciliation of these non-GAAP financial measures to comparable GAAP financial measures is included in today's earnings release, which is located in the Investor Relations section of our website at ssctech.com. I will now turn over the call to Bill.

Thanks, Chand, and welcome everyone. I want to welcome Chand to the investor relations team as she steps in while my daughter, Justine Stone, is on maternity leave. Well, I'm sure she's listening in, probably maybe with my grandson who's now ten days old. Anyway, our fourth quarter results were strong as we set several quarterly records including a record for adjusted revenue of $1.531 billion, up 8.4%. Our earnings also set quarterly records with adjusted diluted earnings per share of $1.58, up 25.4%, and adjusted consolidated EBITDA of $599.1 million, up 6.5%. Our quarterly adjusted consolidated EBITDA margin was 39.1%. Our fourth quarter adjusted organic revenue growth was 7%. Performance was driven by continued strength in global operations, wealth and investment technology business, and our global investor distribution services businesses. Global operations saw new business growth with experienced strength in the wealth-focused software like Black Diamond and GIDS outperformed due to large client volumes and continued growth in its non-transfer agency services. Additionally, the health business finished the quarter above expectations with two deals that were pushed from Q3 into Q4. Our recurring revenue growth rate for financial services was 7.4% for Q4, and 7.2% for the full year 2024, which includes all software-enabled services and maintenance revenue. Fourth quarter cash from operating activities was $486.6 million, up 25.3% from Q4 2023. Our cash flow conversion percentage was 101%, and we bought back 4.9 million shares for $365 million at an average price of $74.46 per share. We continue to believe share repurchases are the best use of our capital absent high-quality accretive acquisitions. In December, we announced an initial strategic lift-out agreement with Insignia Financial to deliver superannuation member administrative services in Australia. We are in the final contract stages with Insignia and expect a lift-out of team members in Australia to occur early in the second half of this year. We are bullish about our opportunities in Australia where we have a 5% market share of the 22 million superannuation fund accounts. I'm gonna now turn it over to Rahul to discuss the quarter and more to take home.

Thanks, Bill. We had another strong quarter with organic revenue growth of 7%, reflecting the underlying strength of our business. Turning to some business highlights, Wealth and Investment Technologies grew 6.8% for the quarter. The Black Diamond wealth platform is growing in the mid-teens. In the investment management industry, Genesis had a year of milestones. We modernized accounting, reconciliation, and trading capabilities and merged development efforts for Aloha into the Genesis development team. Our fund administration business, GlobeOp, saw many new business wins in 2024 contributing to organic growth of 8%. We contributed an additional $21 million in revenue for the year. In 2025, we see continued opportunity driven by retail alternatives and private markets industry growth. Q4 was also a record bookings and revenue quarter for Intralinks due to solid deal count trends, greater deal length, and technological advancements in our offering. Our global investor and distribution solutions business had another strong quarter and brought in greater revenue at our largest clients in addition to new business wins. I'll now turn it over to Brian to run through the financials.

Thanks, Rahul, and good day, everyone. As noted in our press release, our Q4 2024 GAAP results reflect revenues of $1.53 billion, net income of $248 million, and diluted earnings per share of $0.98. Our adjusted non-GAAP results include record revenues of $1.531 billion, an increase of 8.4% over Q4 2023, and record adjusted diluted EPS of $1.58, a 25.4% increase over Q4 2023. The adjusted revenue increase of $118 million over Q4 2023 was primarily driven by incremental revenue contributions from the WIT, GlobeOp, and Intralinks businesses. The acquisition of Bottega contributed $17 million, and foreign exchange had a favorable impact of approximately $2 million. As a result, adjusted organic revenue growth on a constant currency basis was 7%. Our core expenses increased 8.3% or $72 million, which excludes acquisitions and on a constant currency basis. The primary driver of the increased expenses was increased incentive compensation, commissions, and wages. Adjusted consolidated EBITDA was $599 million or 39.1% of adjusted revenue, an increase of $37 million or 6.5% from Q4 2023. On a full-year basis, adjusted consolidated EBITDA was $2.281 billion, an increase of $173 million or 8.2%, resulting in a margin of 38.8%, an improvement of 50 basis points compared to last year. Interest expense for the fourth quarter of 2024 was $113 million, a decrease of $6 million from Q4 2023. Adjusted net income was $402 million, up 26.2%, and adjusted diluted EPS was $1.58, an increase of 25.4%. An increase in the average share price drove the diluted share count up to 254.5 million from 254.1 million at Q3 2024. As Bill mentioned several quarters ago, we continue to strategically evaluate our tax rate, which has been at 26% for several years. We looked at what our adjusted tax rate represents and believe it is appropriate…

Thanks, Brian. We closed out a strong 2024 with a record fourth quarter. Record revenues, record earnings, record cash flows, and a record amount of share repurchases. We have a lot of momentum carrying on into 2025, and we're excited to execute on our plans for investment and growth to deliver long-term shareholder value. So now, open up for questions.

Ladies and gentlemen, we will now begin our question and answer session. If you have dialed in and would like to ask a question, again, as a reminder, please press star followed by the number one on your telephone keypad. We kindly ask everyone to limit themselves to one question and one follow-up. We will pause for a moment to compile the Q&A roster. Your first question comes from the line of Jeff Schmidt with William Blair. Please go ahead.

Hi. Good afternoon. In the healthcare business, clearly, the tailwind is gone. But could you provide us with more details on client wins in the quarter and how does the pipeline look for 2025?

Hopefully, you meant headwinds are gone.

That's right. Headwind. That's right. I'm sorry.

Good. I hate to get confused this early. But we, you know, we won a couple of big license deals in Q4 that, you know, really improved Q4 revenues and, you know, we have a lot of momentum there. It's still, you know, it's big healthcare companies and, you know, they can tend to be very deliberate in their purchases. But, you know, we have some great technology and we have some great pipelines and we have some huge healthcare companies that we're making progress with. I think that we have a lot of opportunity. You know, it is difficult in healthcare to be able to really project on a ninety-day basis on these enormous, you know, insurance and healthcare companies. So, you know, we try to be as prudent and not too conservative. We try not to stick our neck out too far. So we're optimistic and we're very optimistic on a longer-term basis.

Great. And then could you provide us with an update on the cross-selling efforts with and how big do you think that revenue opportunity could be?

I think we currently have seventy-five opportunities, you know, active opportunities that we have with our current clients. I believe we have already closed somewhere fifteen, twenty of them. Or fifteen or twenty others and so I think it could be a pretty large opportunity. I have read some stuff in the industry that says class action lawsuits doubled in 2024, so that would tend to be an opportunity for us. And, you know, we're looking at the business to grow, you know, high single to low double digits and so it should, you know, in 2025, be upwards of $100, $110 million in revenue.

Great. Thank you.

Your next question comes from the line of Alexei Gogolev with William Blair. Please go ahead.

Hello, everyone. Hi, Bill. Three months ago, when you provided us with the fourth quarter guidance, expectations for organic growth at the midpoint was below 3% and you delivered around 7% organic. Sounds like based on what you said in the prepared remarks, there were some deals that slipped from Q3 into Q4. I was wondering if there were any other surprises in the quarter and maybe better than demand environment. Or perhaps some deals that closed earlier than expected.

Hi, Alexei. Yeah. I think the business, a number of the businesses performed very well. And I think that the close rates on the opportunities we had were maybe a little bit better than we expected. And, you know, as we said, the healthcare business also brought in a couple of pretty large license deals. So I think overall, the whole business was a little stronger than we expected and, you know, when things start hitting on a number of cylinders, the business looks pretty strong.

Perfect. Thank you, Bill. And also, directionally, have you had a chance to maybe consider within the team with Rahul and with the rest of the team around the recent decision by the European Commission to cut the corporate reporting requirements by almost a quarter? Do you view regulation or deregulation as a risk to your either regulatory business or filing business, and what sort of long-term view do you have for where the industry is heading?

You know, Alexei, I think there's puts and takes on all of this kind of stuff, and, you know, the less regulation there is of our clients, the faster they grow. The faster they grow, the better for us. You know, do we make some money by helping them with regulation? Of course, we do. But we would much prefer them to grow than to be overregulated.

Makes total sense. Thank you, Bill.

Your next question comes from the line of Dan Perlin with RBC Capital Markets. Please go ahead.

Thanks. Good evening, Bill. Congrats on a good quarter and obviously on your new grandchild. So I wanted to spend a moment if I could, just in terms of thinking through the investment cycle, you know, you've invested a lot in products and that's obviously starting to play out in the organic growth. I'm trying to understand kind of the building blocks that you have for the 5% organic growth at the midpoint for 2025. I know healthcare turned positive and, like I said, there's some lumpiness to the license deals, but it seems like it's gonna be just a lot more sustainable with those levels, and I just want to kind of get your thoughts on what your view is there and maybe the key components to that.

Yeah. I mean, Dan, you've been around SS&C for a while, and you understand that, you know, when we are heavily weighted towards licenses, it's pretty lumpy. You know, when we are bringing in large-scale services business, it tends to grow as more and more of their accounts, more and more of their portfolios, you know, more and more of the services we provide start going live. So we can have a client that's gonna pay us $20 million a year and it doesn't ramp up for, you know, two, three, four quarters. You know, it might start at $2, $3 million a quarter and then $6, $8 million, and then $10, $15 million and then get to $20. And so, you know, it's that kind of a business. It's just a, you know, we have an increasingly larger footprint around the world and, you know, five, six years ago, you know, we were spending $200 to $250 million on sales and marketing, now we're spending $550 to $600 million on sales marketing. We think some of it works. You know, sometimes we wonder, but we think some of it works.

Yep. Totally seeing the results. So one other just quick thing if I could, Bill, I've heard your confidence also speak about, you know, the superannuation opportunity in Australia, and you've got this lift-out. Would you mind just maybe spending just a minute kind of level setting what you think of that market, how big it could be? I know you said you got 5% market share so there's a huge opportunity, but I'm just not as familiar with who the major players are there and what that competitive dynamic is and therefore what your real opportunity is. Thank you.

Yeah. Again, you know, we've been in the Australian market for quite a while, and I think that the superannuation has been built based on some acquisitions that we've done like IRIS and then also about the capabilities that we've built out in our own development cycles and, you know, they call superannuation the wall of money. So I think it really is a pretty brilliant national program that Australia has put in, and is this something where, you know, we think we have the best technologies, we think we have a really good team, we have some really great customers, you know, and those are the kinds of things that really are the ingredients for increased growth, increased client access to our technology, and increased profitability for us.

Excellent. Thank you.

Your next question comes from the line of Peter Heckmann with DA Davidson. Please go ahead.

Hey. Good afternoon, everyone. Sorry. Someone poked their head in, so I hope I haven't already asked my question. But in Insignia Financial, can you talk about that deal a little bit? Whether you've included anything in your 2025 guidance? Then and then if you could, maybe size it a little bit in terms of, you know, what should we be thinking about it in terms of, like, an annual revenue contribution?

Well, you know, Peter, I don't know if we want to get quite as granular as an individual, but it's a very large deal, would be probably in the top twenty in our client base, and, you know, top twenty of SS&C's are pretty big. Pretty big fish in our book. But there's a lot of work to be done, you know, and we need to focus on that client satisfaction and giving them increased capabilities as they become an increasingly large money manager and retirement manager for a bunch of Australians, and that's what we're focused on. And, you know, they've been a really great prospect and we moved very long on way and, you know, like I said, it should be a very significant client for us and, you know, we're gonna get most of the revenue from them in the second half of 2025 as we, you know, we hope to get contracts finalized by the end of this quarter and begin the entire implementation process in Q2.

Okay. And then just in terms of this most recent acquisition, FPS Trust, I did ping Brian. Yeah. They hadn't got any ideas in terms of, like, sizing or price. And would you characterize that as a relatively small tuck-in deal or something a bit bigger?

It is a small tuck-in deal, but it also gives us a real capability that allows us to really leverage what we've done with TrustSuite and other things of the merging of some of the stuff with, you know, the, you know, trust act was had a focus and are getting quite good.

Got it. Thank you.

Your next question comes from the line of Kevin McVeigh with UBS. Please go ahead.

Great. Thanks so much. And let me add my congratulations to you as well, Bill, on your grandson. I guess if it's the midpoint of 2025 is 5%, what would be the low end of that organically, and what would be the high end of that? And any kind of factors as to what gets to the low end as opposed to the high end?

Yeah. You know, I think in general, the way we bookmark these things is, you know, roughly $80 million in revenue on either side of the number. So I think that $160 million is probably a reasonable range. I think as Bill said earlier, what we feel good about is, you know, we have all of our businesses performing reasonably well. Right? And so there's a lot of strength in that combined business. And as we're bringing solutions together across the company, I think that we have more sales opportunities for new clients as well as, you know, getting deeper with the current client base. So there's a lot of positive, but really to answer your question, the things that make us go a little bit towards the lower end of the range versus a little bit towards the higher end of the range really does come down to new sales, timing of implementations, and making sure we get those converted and live fast enough for them to make a meaningful difference during the course of the year. And a little bit organic things or macroeconomic things like deal volume and Intralinks and, you know, fund flows in fund administration. But those are, generally speaking, not as important as the...

Super helpful. And then just real quick, obviously, the healthcare business looks terrific. It sounds like there were some software sales. Is that a pretty good proxy? Like, is there any type of leading indicator that leads to maybe larger contracts or if did you think about 2025 ever, you know, going into 2026? Or is that, you know, kind of independent?

Yeah. That's probably mostly independent, Kevin, but I do think that what is going on in healthcare is that, you know, they're under pressure because the loss ratios in medical have gotten, you know, more expensive for them and, you know, they're looking for ways in which to have lower operating expenses and DomaniRx and a few other of our technologies are quite good at being able to manage your expenses, and that's something where they're gonna have to do it because, you know, the entire healthcare ecosystem is going to be, you know, probably turned a little bit upside down. As this new administration starts to make changes to the Medicare and Medicaid systems and, you know, I don't think they're gonna lower them, lower the expenses, but I do think they're gonna focus on efficiency and effectiveness.

A lot of sense. Congratulations on that. Just really terrific results.

As a reminder, if you are dialed in and would like to ask a question, please press star one. Your next question comes from the line of Andrew Schmidt with TD.

Hey, guys. Thanks for taking my questions, and congrats on the organic growth here. It's great to see. Maybe just dig in the GlobeOp for a second. Nice to see the acceleration there. Maybe we could just unpack the drivers. This quarter over the past few quarters across, you know, private markets, hedge funds, real assets. Any callouts in terms of the growth drivers? And, obviously, you know, middle and back office, you know, where the opportunities are? Thanks, guys.

I think, you know, a lot of it is just it's a continuation of what we've seen the last two years. So private markets, private credit, real estate, continues to be very strong for us. And in that space in particular, it's both opportunities with existing very large funds that are letting us in now and giving us more and more as well as, you know, new funds that for the most part outsource on day one. And we still think there's a lot of new opportunity in that market. Our hedge fund business is also performing. And performed really well in 2024. And that's a combination of new client wins, as well as we're now fortunate in the sense that we have some of the biggest names in the industry, and they have tended to attract almost a disproportionate share of the fund allocation. So our clients are getting bigger. That helps us. We're winning more. And we have a pretty broad opportunity across both hedge and private markets.

That's great to hear, Rahul. Appreciate that. And then maybe just two other questions that separate areas, I'll ask them upfront. Just, you know, GlobeOp, how to think about the range of outcomes for 2025 in terms of baking in. And then just separately, obviously, you know, automation continues to be a big opportunity for you guys. Just maybe give us an update in terms of where you're at in terms of automating key functions and I know some of that is, you know, we invest in a product, etcetera, but where we're at in terms of that initiative. Thanks a lot, guys. Really appreciate it.

Yeah. Just building on what Rahul said. I mean, you know, we honestly believe that we're the best fund administrator in the world, both for hedge funds as well as, you know, private assets whether it's equity or credit or others, you know. So having the expertise that we have and the clients that we have who are demanding, you know, which improves us. You know, when you play in the biggest games, you get better or you don't get to play in the biggest games anymore. So, you know, most of the large-scale macro hedge funds are our clients. And I believe we will continue to have them as our clients. And as Rahul said, as they get there, they get some real star portfolio managers, and those star portfolio managers sometimes spin out, and that, you know, that's why we always say that we much prefer that our clients grow than that they get overregulated. You know, we are much more in really helping our clients access new markets. You know, have the range of what they want to invest in always at the broadest level. That there are clients and that there are no geographic limitations if you're a client of us. So we think those are very valuable to people and I think that we have won a lot of business because we have invested very heavily in being able to deliver those capabilities.

Got it. Thanks so much, Bill. And then just on the automation side...

You know, that's primarily been driven by Blue Prism. I think we're up to, you know, about fifteen hundred and fifty, you know, what we call digital workers and, you know, the savings for us are, you know, moving above $150 million towards $200 million in savings. And, you know, another thing we've done is if you look at us, you know, I think about five, six years ago, we spent, you know, like I said, $200 to $250 million on sales marketing, then we spend, you know, $550 to $600 million on sales marketing. If you look at R&D, it's very similar. We're spending way more than we did five and six years ago. And it's a little bit because we decided to now rather than drive up our margins, we wanted to reinvest in the business and try to drive organic revenue growth. You gotta do that with new products, new services. And it's not without risk of its own. You know, not that we don't build great software and oftentimes, we're successful in building great software, and other times, we're not quite as successful in building great software. So, you know, it's a difficult business and we focus on it and we think that's something that gives us competitive advantage and will continue to give us competitive advantage.

Got it. Thanks so much, Bill.

As there are no further questions at this time, that concludes the Q&A session for today. I would now like to turn the call over to Bill Stone for closing remarks.

Again, we really appreciate you all being on the call and, you know, I knew I had to bring up my new grandson so he wouldn't pick on me, but I think we had good enough numbers that we didn't have to worry about that too much. I'm gonna have to have another one soon. So, anyway, I really appreciate you being on, and I think that, you know, it's always amazing when it's only Rahul and I have to answer and Brian doesn't. Must mean he had really good numbers. Enjoy your week. Thanks for being off. Bye.

This concludes today's meeting. Thank you for your participation. You may now disconnect.