SS&C(US:SSNC)2023-10-26 23:59Financial Data and Key Metrics Changes - Q3 2023 adjusted organic revenue increased by 2.3%, driven by strength in alternatives, particularly private markets, Intralinks, Retirement, and Blue Prism [9] - Q3 2023 GAAP revenues were $1,365.9 million, with net income of $156 million and diluted earnings per share of $0.61 [17] - Adjusted revenues for Q3 2023 were $1,366.7 million, up 3.4% year-over-year, with adjusted diluted EPS of $1.17, a 1.7% increase from Q3 2022 [17][18] - Cash from operating activities for the nine months ended September 30 was $826.7 million, up 8.1% year-over-year [10] - The company paid down $54.7 million in debt in Q3 2023, resulting in a net leverage ratio of 3.18 times consolidated EBITDA [11][26] Business Line Data and Key Metrics Changes - The Alternatives business grew by 8.4% in Q3, supported by a significant private credit client acquisition [20] - Intralinks experienced over 10% growth despite low M&A deal volume, attributed to increased contract values and new tools [40] - Retirement services grew by 15% in Q3, reflecting the go-live of large clients from previous deals [54] Market Data and Key Metrics Changes - Financial Services retention rate for Q3 2023 was 97.3%, the highest in the company's history [9] - The company reported a significant deal pipeline in fund administration exceeding $400 million, indicating strong future revenue potential [38] Company Strategy and Development Direction - The company emphasizes client service and aims to maintain high retention rates while managing expenses with a disciplined approach [27] - Focus on enhancing productivity through digital workers and automation technologies, with a notable deployment of Blue Prism digital workers [19][21] - The company is optimistic about growth opportunities in the healthcare sector, particularly with the DomaniRx initiative [111] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to cross-sell and upsell within the existing client base, contributing to improved retention rates [36] - The company anticipates adjusted organic growth for Q4 in the range of 1.8% to 4.8%, with full-year growth expected between 2.1% and 2.9% [27][30] - Management acknowledged challenges in software license revenue but expects a rebound in Q4 and 2024 [38][86] Other Important Information - The company raised its quarterly dividend by 20% to $0.24 per share, returning $156.6 million to shareholders in Q3 [10] - The company showcased over 40 solutions at the SS&C Deliver Conference, emphasizing AI and robotic process automation [32] Q&A Session Summary Question: What is driving the revenue retention rates? - Management attributed high retention rates to a focus on customer service and improved customer relationship management programs [36] Question: Can you discuss the deal pipeline and conversion cycles? - Management noted a strong pipeline in fund administration and expected a rebound in software license revenue [38][45] Question: What is driving the growth in the retirement segment? - Growth was driven by the go-live of large clients, with more expected in 2024 [54][92] Question: Are there any M&A opportunities in the market? - Management indicated interest in tuck-in acquisitions but emphasized the need for discipline in pricing [90] Question: How is the healthcare business performing? - The healthcare segment is stabilizing, with significant opportunities anticipated from the DomaniRx initiative [111]