Core Insights - The company has completed 'Chapter 2' of its corporate transformation, shifting from a legacy print model to a high-margin, software-centric compliance platform [1] - Achieved record adjusted EBITDA margins of 31.3% for the full year, despite lower overall revenue, indicating structural profitability gains from a more favorable sales mix [1] - Software Solutions now account for approximately 47% of total net sales, driven by a 13% aggregate growth in recurring compliance products ActiveDisclosure and Arc Suite [1] Performance Highlights - ActiveDisclosure's performance improved due to higher net client counts and increased value per client following a full product transition completed in 2023 [1] - The company is strategically exiting low-margin print work and managing secular declines in physical distribution to prioritize tech-enabled services [1] - Deployed 'Active Intelligence' AI capabilities to automate research and analysis for SEC filings, aiming to enhance development velocity and client productivity [1] Market Position - Maintained a dominant market share in high-quality IPO and M&A transactions, capturing 65% of IPOs raising over $100 million in the fourth quarter [1]

Core Insights - The company reported solid full-year results for 2025, with adjusted EBITDA of $239.8 million, an increase of 10.4% year-over-year, and a record adjusted EBITDA margin of 31.3% [1][6]. Financial Performance - Full-year consolidated net sales reached $358.4 million in software solutions, representing about 47% of total sales, indicating a shift towards higher-margin recurring software [6][8]. - In Q4 2025, consolidated net sales rose 10.4% year-over-year to $172.5 million, exceeding guidance, driven by strong capital markets transactional revenue and software growth [4][7]. - Free cash flow for the quarter was $47.9 million, with higher operating cash flow compared to the prior year [2]. Margin and Profitability - Adjusted EBITDA for Q4 was $45.8 million, up 44% from the prior year, with an adjusted EBITDA margin of 26.6%, an increase of approximately 630 basis points year-over-year [3][7]. - The company achieved a record adjusted EBITDA margin of 31.3% for the full year, surpassing the previous record of 29.7% [1][6]. Capital Allocation - The company repurchased approximately $172 million of stock in 2025, representing about 12% of outstanding shares, and ended the year with a non-GAAP net leverage ratio of 0.6x [5][16]. - Total debt at year-end was reported at $171.3 million, with $146.8 million in non-GAAP net debt [17]. Growth Drivers - Software solutions net sales grew 11.4% year-over-year in Q4, with capital markets software solutions net sales increasing by 20% [9]. - ActiveDisclosure saw a 20.2% increase in Q4 sales, with total subscription revenue up about 12% [10][14]. - The company introduced new products in 2025, including Venue Virtual Data Room and ArcFlex, which received positive market responses [15]. Future Outlook - For Q1 2026, the company guided consolidated net sales of $200 million to $210 million, with an adjusted EBITDA margin of 33% to 35% [19]. - The company anticipates continued growth in recurring revenue, which is approaching 80% of total revenue, while event-driven revenue is expected to remain around 20% [18].

Financial Data and Key Metrics Changes - The company achieved a consolidated net sales growth of 10.4% year-over-year in Q4 2025, with adjusted EBITDA increasing by $14.1 million or approximately 44% year-over-year, resulting in an adjusted EBITDA margin of 26.6%, up 630 basis points from the previous year [4][5][24]. - For the full year 2025, consolidated adjusted EBITDA reached $239.8 million, a 10.4% increase year-over-year, with an adjusted EBITDA margin of 31.3%, up 350 basis points from 2024 [6][19]. Business Line Data and Key Metrics Changes - Software solutions net sales grew by 8.7% year-over-year to $358.4 million, comprising approximately 47% of total net sales for 2025 [9][19]. - The capital markets software solutions segment saw net sales of $60 million, a 20% increase from the previous year, driven by strong growth in Venue and ActiveDisclosure, both up approximately 20% year-over-year [27][28]. - The investment company's software solution segment reported net sales of $30.9 million, a decrease of 2.2% compared to Q4 2024, primarily due to tough comparisons with the previous year's strong performance [32]. Market Data and Key Metrics Changes - The company recorded $48.6 million in transactional revenue in Q4 2025, a 29% increase from the previous year, benefiting from a recovery in deal completions following a government shutdown [30]. - The overall equity deal environment showed positive momentum, with a significant increase in the number of IPO transactions raising over $100 million [30][61]. Company Strategy and Development Direction - The company is transitioning to chapter three of its transformation, focusing on sustained growth and increasing the revenue mix towards recurring offerings, which are expected to approach 80% of total revenue [19][20]. - The introduction of new products like ArcFlex and enhancements in existing solutions are aimed at capturing additional market demand, particularly in the private investment space [12][15]. Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the ongoing momentum in capital markets and the potential for increased deal activity in 2026, despite a continued decline in print and distribution sales [20][38]. - The company does not anticipate major SEC rule changes for 2026, but it is well-positioned to capture demand from future regulations [22]. Other Important Information - The company repurchased approximately 3.6 million shares in 2025, representing about 12% of outstanding shares, at an average price of $48.36 per share [4][36]. - Free cash flow for Q4 was $47.9 million, with full-year free cash flow reaching $107.8 million, an increase of $2.6 million over the previous year [35]. Q&A Session Summary Question: How much of the outperformance in Q4 was volume versus price? - Management indicated that the outperformance was predominantly driven by volume, particularly in capital markets transactional revenue, with modest contributions from price [48]. Question: Can you provide more color on the drivers behind the strong margins? - The strong margins were attributed to a favorable sales mix, cost structure improvements, and operating leverage from increased sales, with long-term guidance for margins above 30% [50][51]. Question: How does the potential opportunity in capital allocation look given recent valuation multiples? - Management noted that while valuations have contracted, there may be interesting opportunities as companies seek liquidity, although it may take time for expectations to adjust [52]. Question: Can you discuss the relative TAM for ArcFlex compared to Arc Suite? - ArcFlex can be sold as a standalone product, and there is significant interest in the market for alternative investment solutions, with a growing number of private funds [56][58]. Question: How did DFIN's share of traditional IPOs perform in Q4? - DFIN maintained a strong share of over 65% in IPOs raising over $100 million, with significant activity in the healthcare sector [60][61]. Question: What are the expectations for software growth in 2026? - Continued strong growth is expected from ActiveDisclosure and Venue, while growth in Arc Suite may be more variable due to fewer regulatory changes [68][70].

Investor Presentation February 2026 DFINsolutions.com © 2026 DFIN. All rights reserved This presentation is the intellectual property of DFIN. The ideas expressed in it may not be adopted or reproduced without prior permission from and compensation to DFIN. Forward Looking Statements and Use of Non-GAAP Financial Measures USE OF FORWARD-LOOKING STATEMENTS This presentation includes certain "forward-looking statements" within the meaning of, and subject to the safe harbor created by, Section 21E of the Secur ...

October 2025 DFINsolutions.com © 2025 DFIN. All rights reserved Investor Presentation This presentation is the intellectual property of DFIN. The ideas expressed in it may not be adopted or reproduced without prior permission from and compensation to DFIN. Forward Looking Statements and Use of Non-GAAP Financial Measures USE OF FORWARD-LOOKING STATEMENTS This presentation includes certain "forward-looking statements" within the meaning of, and subject to the safe harbor created by, Section 21E of the Securi ...

Core Insights - Donnelley Financial Solutions reported strong non-GAAP earnings per share of $1.49, exceeding the consensus estimate of $1.42, but total revenue of $218.1 million fell short of expectations of $225.5 million and declined from $242.7 million year-over-year [1][2] Financial Performance - Non-GAAP EPS for Q2 2025 was $1.49, down 10.2% from $1.66 in Q2 2024 [2] - Total revenue was $218.1 million, a decrease of 10.1% from $242.7 million in the prior year [2] - Free cash flow increased to $51.7 million, up 40.5% from $36.8 million in Q2 2024 [2][8] - Adjusted EBITDA fell 12.5% to $76.3 million, with a margin of 35.0%, down 0.9 percentage points [2][7] - Software Solutions revenue reached $92.2 million, growing 7.7% year-over-year and accounting for 42.3% of total sales, up from 35.3% a year ago [2][5] Business Overview - Donnelley Financial Solutions specializes in software and services for compliance, regulatory, and financial reporting, serving corporations, investment companies, and capital markets [3] - The company is focusing on expanding its software offerings while reducing reliance on legacy print and manual services [4] Strategic Focus - Key areas of emphasis include technological leadership in regulatory software and managing the balance between cyclical project-driven demand and stable recurring revenues from software subscriptions [4] - The company aims to achieve a 60% software mix by 2028, with ongoing efforts to grow its software revenue [12] Market Conditions and Outlook - Management anticipates Q3 2025 GAAP net sales between $165 million and $175 million, indicating a decline from both the previous quarter and the prior year [11] - The adjusted EBITDA margin is expected to fall to 23% to 25%, reflecting ongoing pressures from lower transactional and print revenues [11] - The capital markets segment is projected to deliver $35 million to $40 million in transactional net sales [11]

Core Insights - Donnelley Financial Solutions, Inc. (DFIN) reported a decrease in net sales for Q2 2025, totaling $218.1 million, down 10.1% from Q2 2024, primarily due to lower print and distribution volumes and reduced capital markets transactional revenue [3][5][7] - The company achieved record software solutions net sales of $92.2 million, a 7.7% increase year-over-year, with software solutions now accounting for 42.3% of total net sales, up from 35.3% in the previous year [5][7][8] - Adjusted EBITDA for Q2 2025 was $76.3 million, reflecting a decrease of $10.9 million compared to the same quarter in 2024, with an adjusted EBITDA margin of 35.0% [7][8][10] Financial Performance - Net earnings for Q2 2025 were $36.1 million, or $1.28 per diluted share, compared to $44.1 million, or $1.47 per diluted share, in Q2 2024 [4][5][8] - The company reported an increase in operating cash flow by $12.2 million and free cash flow by $14.9 million year-over-year [5][7] - Gross leverage was reported at 0.9x and net leverage at 0.7x as of June 30, 2025 [5][7] Market Outlook - The company expressed optimism regarding improving market activity trends despite ongoing macroeconomic challenges, indicating a focus on transitioning to a more recurring sales mix and disciplined capital allocation [2][5] - Guidance for Q3 2025 includes total net sales projected between $165 million and $175 million, with an adjusted EBITDA margin expected to range from 23% to 25% [10][11]

Company Overview - DFIN is a leader in assisting companies with their regulatory reporting requirements[9] - DFIN's portfolio of software solutions and regulatory experts support corporations and money managers in SEC compliance document creation, formatting, filing, and distribution[10] - Approximately 80% of the top 50 global fund complexes work with DFIN[10] Financial Performance & Metrics - Q1 2025 TTM net sales reached $779.6 million[12, 25] - Q1 2025 TTM Adjusted EBITDA was $230.3 million, resulting in a 29.5% margin[12, 19, 25] - Q1 2025 TTM Free Cash Flow was $94.4 million[25] - Net leverage as of March 31, 2025, was 0.8x[14, 25, 51] - Software sales in Q1 2025 TTM reached $334 million[14] Capital Allocation & Shareholder Value - From 2020 to 2024, the company repurchased 8.3 million shares for $276.4 million, at an average price of $33.42 per share[48] - A $150 million share repurchase program is in place, expiring December 31, 2025[49] Segment Performance (Q1 2025 TTM) - Capital Markets segment net sales were $527 million, with an EBITDA of $178 million and a 34% margin[12] - Investment Companies segment net sales were $253 million, with an EBITDA of $90 million and a 36% margin[12]

Core Insights - Donnelley Financial Solutions, Inc. (DFIN) reported strong financial performance in Q1 2025, with Adjusted EBITDA of $68.2 million, a 23.6% increase year-over-year, and an Adjusted EBITDA margin of 33.9%, up approximately 680 basis points from the previous year [2][6][7]. Financial Performance - Net sales for Q1 2025 were $201.1 million, a decrease of $2.3 million, or 1.1%, from Q1 2024, primarily due to lower capital markets compliance volumes and Venue sales [4][6]. - Net earnings for Q1 2025 were $31.0 million, or $1.05 per diluted share, compared to $33.3 million, or $1.09 per diluted share, in Q1 2024 [5][6]. - The company achieved record software solutions net sales of $84.6 million, a 5.4% increase from Q1 2024, accounting for 42.1% of total net sales, up from 39.5% [6][8]. Strategic Focus - DFIN is focused on expanding the adoption of its software solutions, with a 5.8% organic increase in total software solutions net sales compared to Q1 2024 [3][6]. - The company aims to increase its recurring sales mix, manage costs aggressively, and allocate capital in a disciplined manner to enhance shareholder value [3][6]. Debt and Share Repurchase - DFIN amended its credit agreement to establish a $300 million revolving facility and a $115 million term loan A facility, using proceeds to retire existing debt [6][7]. - The company repurchased 861,301 shares for approximately $41.8 million at an average price of $48.57 per share, with a remaining share repurchase authorization of $49.5 million as of March 31, 2025 [6][7].