Press Release

For Immediate Release

SS&C Technologies Releases Q4 and Full Year 2020 Earnings Results


Q4 2020 GAAP revenue $1,203.4 million, flat, Fully Diluted GAAP Earnings Per Share $0.74, up 37.0%

Adjusted revenue $1,206.1 million, down 0.5%, Adjusted Diluted Earnings Per Share $1.13, up 4.6%

WINDSOR, CT, February 10, 2021 (PR Newswire) SS&C Technologies Holdings, Inc. (NASDAQ: SSNC), a global provider of investment, financial, and healthcare software-enabled services and software, today announced its financial results for the fourth quarter and full year ended December 31, 2020.

(in millions, except per share data): Three Months Ended December 31, 2020 Three Months Ended December 31, 2019 Change Twelve Months Ended December 31, 2020 Twelve Months Ended December 31, 2019 Change
GAAP Results
Revenue $1,203.4 $1,203.5 (0.0)% $4,667.9 $4,632.9 0.8%
Operating income 268.7 261.3 2.8% 985.8 914.4 7.8%
Operating income margin 22.3% 21.7% 60 bp 21.1% 19.7% 140 bp
Diluted earnings per share $0.74 $0.54 37.0% $2.35 $1.66 41.6%
 
Adjusted Non-GAAP Results (defined in Notes 1 - 4 below)
Adjusted revenue $1,206.1 $1,212.2 (0.5)% $4,681.1 $4,668.8 0.3%
Adjusted operating income 458.8 470.0 (2.4)% 1,781.9 1,742.7 2.2%
Adjusted operating income margin 38.0% 38.8% (80 bp) 38.1% 37.3% 80 bp
Adjusted diluted earnings per share $1.13 $1.08 4.6% $4.30 $3.83 12.3%

Fourth Quarter and Full Year 2020 Highlights:

  • SS&C generated net cash from operating activities of $1,184.7 million for the twelve months ended December 31, 2020.
  • We paid down $738.2 million in debt in 2020 to bring our net leverage ratio and net secured leverage ratio to 39 times and 2.31 times consolidated EBITDA, respectively.
  • Repurchased 3.7 million shares of common stock in 2020 at an average price of $60.99 per shares for $227.7 million.
  • SS&C spent $471.0 million on research & development and capitalized software in 2020, and acquired three businesses for $138.9 million, a total of over $600 million.
  • Launched SS&C’s Blue Sky Portal, a dedicated cloud-based technology solution to help investment managers comply with state Blue Sky laws.
  • SS&C Health completed the new COVAX Program, focused on ensuring the successful completion of the COVID Vaccine series for members receiving the vaccination from SS&C Health partner pharmacies.

“SS&C’s 2020 financial results prove the resiliency of our business model, the stability of our client base, and the dedication of our workforce. Despite the many challenges this year presented, we were able to grow earnings in the double digits, hold margins steady, complete three acquisitions, while keeping our employees safe,” says Bill Stone, Chairman and Chief Executive Officer. “SS&C generates nearly 25% of our revenue in operating cash which demonstrates the power of our business model.  2021 is the third year anniversary of our 2018 deployment of $8.3 billion in capital to acquire DST Systems, Eze Software, and Intralinks.  Our adjusted earnings per share have grown from $1.93 in 2017, to $2.92 in 2018, to $3.83 in 2019 and $4.30 in 2020. The 4 year compounded growth rate in adjusted earnings per share is 22.2%.  We believe cash from operations and adjusted earnings per share are good proxies for the health of our business.”

“We have also been meeting with major shareholders and have begun a significant change to our executive compensation system and overall corporate governance.  SS&C has a 35 year history of adapting to change and in February of 2021 we have never had more opportunity, more resources to pursue these opportunities, or a more talented workforce.  I want to thank our employees, customers and suppliers for focusing, collaborating and accomplishing our 2020 goals.  We look at 2021 with increased optimism.”

Operating Cash Flow

SS&C generated net cash from operating activities of $1,184.7 million for the twelve months ended December 31, 2020, compared to $1,328.3 million for the same period in 2019.  SS&C ended the fourth quarter with $209.3 million in cash and cash equivalents and $6,504.9 million in gross debt, for a net debt balance of $6,295.6 million.  SS&C’s consolidated net leverage ratio as defined in our credit agreement stood at 3.39 times consolidated EBITDA as of December 31, 2020. SS&C’s net secured leverage ratio stood at 2.31 times consolidated EBITDA as of December 31, 2020.

SS&C’s COVID-19 Response

SS&C is operating in a global public health crisis.  Covid-19’s impact is devastating to many and nations are being tested from human and economic perspectives.  As long as the duration and scale of the pandemic and economic slowdown remains we expect markets to be volatile. The slowdown in the global economy will take time to recover.

Guidance
    Q1 2021   FY 2021
Adjusted Revenue ($M)   $1,158.0 – $1,198.0   $4,685.0 – $4,875.0 
Adjusted Net Income ($M)   $281.5 – $298.5   $1,185.0 – $1,270.0
Adjusted Diluted Earnings per Share   $1.05 – $1.11   $4.36 – $4.64
Cash from Operating Activities ($M)     $1,240.0 – $1,320.0
Capital Expenditures (% of revenue)     2.6% – 3.0%
Diluted Shares (M)   269.0 – 270.0   271.5 – 274.0
Effective Income Tax Rate (%)   26%   26%

SS&C does not provide reconciliations of guidance for Adjusted Revenues and Adjusted Net Income to comparable GAAP measures, in reliance on the unreasonable efforts exception provided under Item 10(e)(1)(i)(B) of Regulation S-K.  SS&C is unable, without unreasonable efforts, to forecast certain items required to develop meaningful comparable GAAP financial measures.  These items include acquisition transactions and integration, foreign exchange rate changes, as well as other non-cash and other adjustments as defined under the Company’s Credit agreement, that are difficult to predict in advance in order to include in a GAAP estimate.  The unavailable information could have a significant impact on Q1 2021 and FY 2021 GAAP financial results.

Non-GAAP Financial Measures

Adjusted revenue, adjusted operating income, adjusted consolidated EBITDA, adjusted net income and adjusted diluted earnings per share are non-GAAP measures.  See the accompanying notes for the reconciliations and definitions for each of these non-GAAP measures and the reasons our management believes these measures provide useful information to investors regarding our financial condition and results of operations.

Earnings Call and Press Release

SS&C’s Q4 2020 earnings call will take place at 5:00 p.m. eastern time today, February 10, 2021.  The call will discuss Q4 2020 results and business outlook.  Interested parties may dial 844-343-4183 (US and Canada) or 647-689-5128 (International), and request the “SS&C Technologies Fourth Quarter and Full Year 2020 Conference Call”; conference ID # 1458468.  In connection with the earnings call, a presentation will be available on SS&C’s website at http://investor.ssctech.com/results.cfm. A replay will be available after 10:00 p.m. eastern time on February 10, 2021, until midnight on February 17, 2021.  The replay dial-in number is 800-585-8367 or 416-621-4642; access code # 1458468.  The call will also be available for replay on SS&C’s website after February 10, 2021; access: http://investor.ssctech.com/results.cfm.

Certain information contained in this press release relating to, among other things, the Company’s financial guidance for the first quarter and full year of 2021 constitute forward-looking statements for purposes of the safe harbor provisions under the Private Securities Litigation Reform Act of 1995.  Forward-looking statements include statements concerning plans, objectives, goals, strategies, expectations, intentions, projections, developments, future events, performance, underlying assumptions, and other statements that are other than statements of historical facts.  Without limiting the foregoing, the words “believes”, “anticipates”, “plans”, “expects”, “estimates”, “projects”, “forecasts”, “may”, “assume”, “intend”, “will”, “continue”, “opportunity”, “predict”, “potential”, “future”, “guarantee”, “likely”, “target”, “indicate”, “would”, “could” and “should” and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements are accompanied by such words.  Such statements reflect management’s best judgment based on factors currently known but are subject to risks and uncertainties, which could cause actual results to differ materially from those anticipated.  Such risks and uncertainties include, but are not limited to, the state of the economy and the financial services industry and other industries in which the Company’s clients operate, the Company’s ability to realize anticipated benefits from its acquisitions, including DST Systems, Inc.,  the effect of customer consolidation on demand for the Company’s products and services, the increasing focus of the Company’s business on the hedge fund industry, the variability of revenue as a result of activity in the securities markets, the ability to retain and attract clients, fluctuations in customer demand for the Company’s products and services, the intensity of competition with respect to the Company’s products and services, the exposure to litigation and other claims, terrorist activities and other catastrophic events, disruptions, attacks or failures affecting the Company’s software-enabled services, risks associated with the Company’s foreign operations, privacy concerns relating to the collection and storage of personal information, evolving regulations and increased scrutiny from regulators,  the Company’s ability to protect intellectual property assets and litigation regarding intellectual property rights, delays in product development, investment decisions concerning cash balances, regulatory and tax risks, risks associated with the Company’s joint ventures, changes in accounting standards, risks related to the Company’s substantial indebtedness, the market price of the Company’s stock prevailing from time to time, and the risks discussed in the “Risk Factors” section of the Company’s most recent Annual Report on Form 10-K and Quarterly Report on Form 10-Q, which are on file with the Securities and Exchange Commission and can also be accessed on our website.  Forward-looking statements speak only as of the date on which they are made and, except to the extent required by applicable securities laws, we undertake no obligation to update or revise any forward-looking statements.

About SS&C Technologies

SS&C is a global provider of services and software for the financial services and healthcare industries. Founded in 1986, SS&C is headquartered in Windsor, Connecticut, and has offices around the world. Some 18,000 financial services and healthcare organizations, from the world's largest companies to small and mid-market firms, rely on SS&C for expertise, scale, and technology.

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Click here to view the financial earnings statement in PDF format.


Contact(s):

  Patrick Pedonti
  Chief Financial Officer
  Tel: +1 860-298-4738

  Justine Stone
  Investor Relations
  Tel: +1 212-367-4705
  E-mail: InvestorRelations@sscinc.com