SS&C Technologies Holdings Inc at UBS Global Technology and AI Conference Summary

The following is excerpted from the question-and-answer section of the transcript.

Question: Kevin Mcveigh - UBS - Analyst : <_ALACRA_META_ABSTRACT>Bill, this is the third time we've been fortunate to host you. I've always started with the same question. And it's important to level set what you've done with SS&C over time. And so maybe just briefly talk about, I think, the business you started in 1986 with $86,000 of revenue and you're kind of pacing to $6 billion today. And over the course of time, there's been some transformational events, whether it's the acquisition of DST, Intralinks. So maybe talk about the initial vision and kind of some of those more transformational acquisitions that kind of put you where you are today because you've been -- just had so much foresight for the industry and continue to really, really execute at a high level. William Stone - SS&C Technologies Holdings Inc - Chairman of the Board, Chief Executive Officer Well, thanks. Thanks for having me, and thanks for all of you for spending some time. You go back to 1986, the world was a different place, right? I mean, that's the beginning of the PC as really the workhorse in the tech. So the ability to have a smart client rather than a big mainframe or even a mid-range was really what really changed the world. And when I first started, we were doing -- building systems for large-scale insurance companies and pension funds for their investments. These places didn't trade like a hedge fund or a broker-dealer. They traded five, six, seven trades a week, sometimes a month. And so you have a PC that says MIPS. Not that I'm some tech wizard by any stretch of the imagination but I think that stands for millions of instructions per second. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. DECEMBER 05, 2024 / 7:15PM, SSNC.OQ - SS&C Technologies Holdings Inc at UBS Global Technology and AI Conference Let's see, if you're doing five trades in a week, I bet you can get those through a PC in a pretty fast time. And so when we did the first system called CAMRA, Complete Asset Management Reporting and Accounting system in 1987 at General American Life Insurance Company in St. Louis. And I had audited General American when I was with KPMG, and the guy who was an assistant treasurer, a guy named Larry Rubenstein, had risen to be Chief Investment Officer. And I had started SS&C and he hired me to build him the system. And he was paying their IT department about $90,000 a month to run a system called bond and stock. And I think that was owned by Policy Management Systems Corp, and that was another one that was owned by like all American Systems, and it was called stock and bond. Really great marketers in this business, right? So he's paying $90,000 a month. It cost him over $1 million to run it. We build him a system for $115,000. He has a little server in a closet. He doesn't have to pay the $90,000 a month anymore, and he's got a system that he has real-time access. So those kinds of things are what happened in the '80s. You fast forward, really, we still have the same thing. Now the power of the handheld is the way we hire in the infrastructure, right? You can get on your phone; you can call anybody in the world anywhere. And that infrastructure is what's allowed us -- and we're going through the big things that I think since the '80s and that's this AI revolution. So all this Gen AI, all this intelligent automation, all this stuff is changing because what it's doing, it's replacing humans. Before, you didn't really replace humans. You just changed how they worked. But now we're using digital workers instead of humans. And what do you get? Well, they don't b****, for starters. They don't get raises. They work 24/7 and you just have to build really smart ones. And then you have to make sure that your people that start using all this Gen AI and everything, that they don't forget to think, right? Because they don't do a lot for you. And so we think it's really important to have the right controls, the right security, the right education, the right training in order to be able to take advantage of it without taking undue risk. So that's what we're thinking. And so we've always tried to get a large portfolio of systems and services that we could sell because we sell to big places. So we have Capital Group, and there are tens of millions in revenue to us if we can sell them something new and get a 10% uptick, that might be worth $10 million to us, whereas if you get an old one that's a couple of hundred thousand, you get a 10% uptick, you get $20,000. When you're at $6 billion and you need to get my friends out here, they want us to grow mid-single digits at $20,000, man, you need to do a bunch of those. So we need to get big players, and we do have big players: JPMorgan, Fidelity, Capital Group, St. James Place. And now you see things like I've told you before, like companies have problems like Link Administration in Australia. So now we're a big player in superannuation and we're going to get way bigger, right, because we have great products and great services. And we've delivered, and we have a number of very highly referenceable clients in Australia. And so those are really big pools of money, like $100 billion, $200 billion, some older things. St. James Place in London has 4,600 RIAs, again, a huge place. We do a lot of stuff in private, so we do it with like KKR and Carlyle and all this. And I think we're up to about $900 billion in private assets that we track and report on. So it's that kind of stuff. And the acquisitions we've done have really accelerated what we do. The latest one is Battea and they do class action recovery services. So for our clients, they used to just throw those things in the trash. Now we take them and we go down, we track it all down, get them what their payment is going to be and just send them a check. And we take -- we clip a 15% fee on it. But it's all found money for them. So it's really worked out very, very well for us. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. DECEMBER 05, 2024 / 7:15PM, SSNC.OQ - SS&C Technologies Holdings Inc at UBS Global Technology and AI Conference

Question: Kevin Mcveigh - UBS - Analyst : And that really proves that, I mean, I think if you look at the AUA that you disclosed about $2.5 trillion in the most recent quarter, it's up almost 15% since 2022 in a market that's been uneven. And to your point, it just got the private market dynamics of that and really impressive. Switching to kind of the growth targets, just rounding out the M&A. Maybe talk to Blue Prism a little bit. Just you've had it a couple of years. There's been a real opportunity on both the revenue side but also the margin. So maybe how we're thinking about that,

Question: Kevin Mcveigh - UBS - Analyst : In addition, what's been really impressive growth on the AUA, the retentions really increased, too. Is that a function of the client mix as you're kind of scaling more up? Maybe help us understand that a little bit because I think it's -- when I think of AUA and the retention and the pricing, which I'll get into a minute, I think it really helps explain some of the success you've seen on the organic growth. But maybe just talk to the retention a little bit.

Question: Kevin Mcveigh - UBS - Analyst : You had a terrific Investor Day in the fall. I think what we're really encouraged about was the organic growth targets of 4% to 8%. I think historically, it was probably closer to 4% to 7%. I was just to kind of frame that a little bit. I think the midpoint of the range for '24 is 4.9%, which is up pretty meaningfully from 1.6% in '22. One of my big takeaways from kind of the new range was it didn't feel like it was macro. It felt a little bit more structural to me, right, whether it's pricing, retention, AUA, average quantas. So maybe talk to that a little bit, if you can, because I think it's been a really nice outcome in terms of, again, a lot of the larger wins, as they start to come in kind of create this base, that you can kind of grow off of. So maybe any way to dimensionalize the pricing as opposed to retention as opposed to -- and again, it doesn't feel like we're in the best launch environment. Clearly, there hasn't been an M&A cycle yet, ECM, which would impact things like Intralinks, but maybe just any thoughts around that? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. DECEMBER 05, 2024 / 7:15PM, SSNC.OQ - SS&C Technologies Holdings Inc at UBS Global Technology and AI Conference

Question: Kevin Mcveigh - UBS - Analyst : That's helpful. Any questions from the audience? Probably pretty good time to open up or anyone -- I'll check, anything on the line? All right. Terrific. We'll keep going then. You alluded to this a little bit but I think it's important. Maybe talk to -- because the margin impact in '22 was staffing levels. Also maybe some of the margin dilution from Blue Prism. You scaled up pretty dramatically, right? But you talk about efficiency with your staff. Maybe how Blue Prism can impact the efficiencies because I think one of the things that we think is terrific is, right, some of that lower pick and axe work that your staff don't need to do and you can kind of upskill them, right? And to your point, pay them more without maybe having the same impact on margin as what you might have had historically. So maybe talk to that a little bit and where we are in the pacing of Blue Prism internally at assets. And obviously, there's a pretty

Question: Kevin Mcveigh - UBS - Analyst : One thing, because, as long as we've covered you, you've been maniacal about cash flow. And again, you've delevered the balance sheet from, I think, 6.5 times in 2018 to sub-3. If you look at the pacing of that, I probably don't have it to the dollar. But over that period, it was probably 50% deleveraging, 25% buyback, 25% dividend. More recently with the leverage where you want it, it seems like you really increased the buyback. So maybe any thoughts on capital allocation, given where you are? And you've been much more, I'd say, selective on M&A. Just any thoughts around just capital allocation more broadly? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. DECEMBER 05, 2024 / 7:15PM, SSNC.OQ - SS&C Technologies Holdings Inc at UBS Global Technology and AI Conference

Question: Kevin Mcveigh - UBS - Analyst : Sounds like Juan Soto. I'm glad you mentioned competition because maybe talk to that a little bit. And to your point on, I think, the market endorsing your strategy, whether it's SimCorp being acquired by Deutsche Borse, Addenda being acquired by Nasdaq and really healthy multiples. Maybe talk to that a little bit in terms of, has that created any opportunity on that integration or anything across the broader spectrum? Because again, was kind of $86,000 but of -- revenue. But when you look at 2018, the shift in the scale of the business, I think, is a opportunity, really scaling to much larger clients and deliver on that, which we really like because it creates more stability, more retention, more predictability. Maybe just talk to that a little bit.

Question: Kevin Mcveigh - UBS - Analyst : Two other, and correct me if I'm wrong, but I think it used to be historically, you'd have to hire somewhere around 1,500 accountants a year to service the incremental revenue that you'd have come in, in any given year. I think that number has been reduced. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. DECEMBER 05, 2024 / 7:15PM, SSNC.OQ - SS&C Technologies Holdings Inc at UBS Global Technology and AI Conference Maybe I think in '24, it was flat. I don't know if it's quite going to be flat going forward, but any thoughts as to some of the leverage just -- and again, it's right, you drive more expertise as some of the lower end things get automated. But any thoughts -- because we always thought one of your real core competencies was the hiring process because it's -- when I started Deloitte, class was 450. I think it's 200 now. So there's a supply-demand imbalance in CPAs, but just any thoughts on what you need to hire to kind of serve the demand, if you would?

Question: Kevin Mcveigh - UBS - Analyst : I think we'll close it there unless any last questions in the audience?