FactSet(US:FDS)2023-09-21 18:53Financial Data and Key Metrics Changes - The company ended fiscal 2023 with organic ASV plus professional services growth of 7% and delivered annual revenue of $2.1 billion with adjusted EPS of $14.55 [7][50] - GAAP revenue for Q4 increased 7% to $536 million, while organic revenue also increased 7% to $535 million, primarily driven by Analytics & Trading [21][50] - Adjusted EBITDA increased to $172 million, up 8.6% year-over-year, and free cash flow for the quarter was $156 million, an increase of 15% over the same period last year [67] Business Line Data and Key Metrics Changes - Analytics & Trading organic ASV grew by 9%, with growth among asset owners driven by middle office solutions, workstations, and feeds [37] - Content & Technology Solutions (CTS) grew fastest, with organic ASV growth slightly over 9%, driven by channel partners and asset management clients [37] - Research & Advisory grew organic ASV by 5%, with private equity and venture capital clients continuing double-digit growth despite market headwinds [17] Market Data and Key Metrics Changes - Organic ASV growth in the Americas was 7%, driven by asset owners and CTS wins, but offset by weakness among asset and wealth management clients [36] - EMEA saw organic ASV growth close to 8%, with growth in asset owners driven by analytics and middle office solutions [16] - Asia Pacific delivered organic ASV growth of 8%, primarily driven by strong growth in Japan [60] Company Strategy and Development Direction - The company is focusing on enhancing its portfolio manager bot and developing solutions for wealth managers to drive client engagement [10][11] - Strategic investments in generative AI are among the top initiatives for fiscal 2024, with expectations to improve user experience and operational efficiency [29][32] - The company aims to capture additional market share in underpenetrated areas with solutions for senior bankers and investor relations professionals [34] Management's Comments on Operating Environment and Future Outlook - Management expects fiscal 2024 to be a tale of two halves, with continued caution in the first half but an improved operating environment in the second half [19][62] - The company anticipates organic ASV growth of 7% for fiscal 2024, with expectations for improved client sentiment and budget resets at the turn of the calendar year [62] - Management noted that while macro uncertainty contributes to elongated sales cycles, the sales team successfully executed several large wins and renewals [15] Other Important Information - The company repurchased 264,400 shares for $109.6 million and authorized a new share repurchase program of up to $300 million [68] - Adjusted operating margin improved by 210 basis points to 33.6%, exceeding previous guidance [55] - The company expects an effective tax rate of 17% to 18% for fiscal 2024 due to higher pre-tax income and changes in foreign tax rates [48] Q&A Session Summary Question: Insights on the wealth business - Management expressed bullishness on the wealth space, noting opportunities in adjacent workflows and a healthy pipeline despite some client cost-cutting [64][65] Question: Clarification on fiscal 2024 guidance - Management indicated that the guidance assumes improved budgets in the second half, with a focus on technology investments and pricing realization [75][80] Question: Long-term margin expansion strategies - Management highlighted control over costs and the need for continued investment in technology to drive margin expansion [86][87] Question: Growth in employee count and hiring focus - Management plans for a 5% increase in hiring for FY '24, focusing on Centers of Excellence and technology talent [135][138]