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spk12: Good afternoon. Thank you for standing by. My name is Brent and I will be your conference operator today. At this time, I would like to welcome everyone to the SS&C Technologies fourth quarter and full year 2021 earnings conference call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you'd like to ask a question at that time, simply press star followed by the number one on your telephone keypad. If you'd like to withdraw your question, again, press star one. Thank you. It's now my pleasure to turn today's call over to Justine Stone, head of investor relations. Please go ahead, ma'am.
spk05: Hi, everyone. Welcome and thank you for joining us for our fourth quarter and full year 2021 earnings call. I'm Justine Stone, Investor Relations for SS&C Technologies. With me today is Bill Stone, Chairman and Chief Executive Officer, Rahul Kanwar, President and Chief Operating Officer, and Patrick Vedanti, our Chief Financial Officer. Before we get started, we need to review the Safe Harbor Statement. Please note that various remarks we make today about future expectations, plans, and prospects, including the financial outlook we provide, constitute forward-looking statements for the purposes of the Safe Harbor provisions under the Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those indicated by these forward-looking statements as a result of various important factors, including those discussed in the risk factor section of our most recent annual report on Form 10-K, which is on file at the SEC and can also be accessed on our website. These forward-looking statements represent our expectations only as of today, February 10th, 2021. While the company may elect to update these forward-looking statements, it specifically disclaims any obligation to do so. During today's call, we'll be referring to certain non-GAAP financial measures or reconciliation of these non-GAAP financial measures, comparable GAAP financial measures. It's included in today's earnings release, which is located in the Investor Relations section of our website at www.sfctech.com. In the third quarter of 2021, we entered into a joint venture named DomaniRx LLC, which we are the majority interest holder and primary beneficiary. All earnings figures discussed today, including operating income, EBITDA, net income, and EPS are attributable to SS&C based on the ownership interest retained by SS&C. I will now call the turnover to Bill.
spk04: Thanks, Justine, and thanks, everyone, for joining. Our results for the fourth quarter are $1.296 billion in adjusted revenue, up 7.5 percent, and $1.28 in adjusted diluted earnings per share, up 13.3 percent. For the year, adjusted revenue was $5,058.9 million, up 8.1 percent, and adjusted diluted APS was $5.02. up 16.7 percent. Adjusted consolidated EBITDA was $522.9 million for the quarter, and our EBITDA margin was 40.3 percent. Our fourth quarter adjusted organic revenue was up 6.9 percent, ahead of our expectations. Our alternatives at interlex businesses, interlinks businesses continue to drive our top-line growth, growing at 12.9 and 23 percent, respectively. As I mentioned in our earnings press release, the pandemic and its impact on the labor force has put pressure on our costs. Much of our R&D efforts are diverted towards automation and efficiency in our services business, and these productivity gains should counteract the pressure from higher labor costs. At the same time, the great resignation is drawing attention at the highest levels of fund companies, causing many to consider third-party administrators. This creates opportunity. We continue to see shifts in talent across the industry. Firms with in-house operations cannot hire talent fast enough and our competitors are not able to replace talent or meet the needs of scaling their businesses. We see this phenomenon worldwide and we expect it to be a catalyst for outsourcing services as well as clients being willing to invest in technology. 2021 was a record-breaking year for M&A. propelling our interlinks business to new heights while our execution generated market share gain. Global M&A volumes topped $5 trillion for the first time ever, comfortably eclipsing the previous record of $4.55 trillion. Based on publicly announced deals, we gained 5 percent market share in the M&A market. Our current forecast, based on a survey of over 300 dealmakers, found a majority expected level of M&A activity to increase in 2022. SF&C generated net cash from operating activities of $1,429,000,000 for the 12 months ended December 31st, 2021, up 20.6% or $244,000,000 from 2020. We paid down $519.9 million in debt in 2021 and our leverage ratio stand at 1.72 secured and 2.69 total. Our shareholder-friendly capital allocation strategy remains a top priority. In 2021, we bought back 6.8 million shares at an average price of $71.74 per share for a total of $487.9 million. We were restricted from buying back stock in Q4-21 due to material non-public information related to the Blue Prism acquisitions. In November, the Board approved a 25% increase in our quarterly dividend payout, now at $0.20 per share. We are still limited to what we can say regarding the Blue Prism acquisition. We have made good progress with regulatory approvals and expect to close in Q1 or Q2. For more background on this acquisition and information on our strategic rationale, please refer to our scheme documents. I'll now turn the call over to Rahul to discuss the quarter in more detail.
spk10: Thanks, Bill. Sales execution, market strength, and collaboration across our business units have been key drivers to this year's performance. Our business performed extremely well, and we made great progress on new technology, which will set us up for further success. We continue to focus on innovation and algorithmics, Our clients' front office operations can now achieve nanosecond response times for pre-trade deal checks. Algorithmic integration with Singularity has led to new wins and increased pipeline. Chorus, our automated workflow solution, has released a new workforce optimization tool focused on in-office, remote, and hybrid management to improve productivity and provide insights. Newly created SS&C Trust Suite combining Black Diamond and InnoTrust under a single contract and commercial model was sold to the first client. On the healthcare front, DomaniRx has been making great strides in building our cloud-native, API-driven claims adjudication platform. Now I will mention some key deals for Q4. A top health insurance company chose Singularity Outsourcing Services for their investment accounting operations. A $8 billion in AUM hedge fund chose a suite of Globop's middle and back office services, citing our ownership of technology as a key component to the win. A premier financial services firm chose our mutual fund sub-accounting and all-serve solution to efficiently scale and grow their new business. A $4.5 billion AUM asset manager based in Kuwait chose a suite of Advent Geneva products. A $7.5 billion AUM trust company chose a suite of Advent Cloud Delivery products due to our overall solution for equity and fixed income. A New York-based hedge fund with a firm-wide objective to move to the cloud upgraded their trading operations to Ezeklips. The pension and investment arm of one of the Canadian provinces chose to upgrade to our newest investment accounting solution, Aloha. A large Malaysian insurer also chose Aloha and our vision reporting solution. I will now turn it over to Patrick to run through the financials.
spk09: Thank you. Results for the fourth quarter of 2021 were GAAP revenues of $1,294.2 million, GAAP net income of $250.9 million, and diluted EPS of $0.94. Adjusted revenues were $1,296.2 million, including the impact of the adoption of the Revenue Standard 606 and for acquired deferred revenue adjustments or acquisitions. Adjusted revenue was up 7.5 percent. Adjusted operating income increased 10.6 percent. And adjusted EPS was $1.28, a 13.3 increase over Q4 2020. Revenue shows strong growth with strength across several product lines, including the alternative asset business, Advent, Alps, brokerage, and the interlinked businesses. Adjusted revenue increased 90.1 million or 7.5 percent over Q4 2020. Our acquisitions contributed 10.5 million in the quarter. Foreign exchange had a favorable impact of 0.8 million or 0.1 percent in the quarter. Adjusted organic revenue increased on a constant currency basis was 6.9 percent in the quarter. Adjusted operating income for the fourth quarter was $507.5 million, an increase of 48.7 or 10.6 percent in the fourth quarter of 2020. Adjusted operating margins increased from 38 percent in the fourth quarter of 2020 to 39.2 percent in the fourth quarter of 2021, driven by revenue growth and cost controls. Expenses increased 4.2 percent on a constant currency basis, Acquisitions added 8.6 million expenses, and foreign currency increased costs by 0.7 million. Adjusted consolidated EBITDA defined in Note 3 of our earnings release was 522.9 million, or 40.3% of adjusted revenue, and increased 47.1 million, or 9.9% from Q4 2020. Net interest expense for the quarter was $49 million and includes $3.2 million of non-cash amortized financing costs and OID. The average interest rate in the quarter for our credit facility, including on senior notes, was 3.09% compared to 2.99% in the fourth quarter of 2020. A reduction in the debt balance resulted in interest expense decrease of $4.1 million, or 8%. Adjusted net income defined in note four of our earnings release was $341.3 million, and adjusted EPS was $1.23. And the effective tax rate used for adjusted net income was 26%. Diluted shares increased to $267 million from $266.5 million in Q3, as a result of an increase in the average share price and options exercises. On our balance sheet and cash flow, we ended the fourth quarter with $564 million of cash and cash equivalents and $6 billion of gross debt. SS&C's net debt has defined our credit agreement, which SLU's cash and cash equivalents of $139.5 million held by Damani RX LLC was $5.6 billion as of the end of the year. Operating cash flow for the 12 months was $1,429,000, a $244,000,000 or 20.6% increase compared to 2020. And for the 12 months ended December 31st, For the full year, we allocated proportionally our free cash flow to both stock buybacks and debt payments. Treasury stock buybacks were $487.9 million for purchases of 6.8 million shares at an average price of $71.74 per share, and that compares to $227.7 million of Treasury buybacks in 2020. In July 2021, the Board authorized a new stock repurchase program for up to $1 billion in stock buybacks. We have approximately $837 million remaining on that authorization. Net debt payments were $519.9 million compared to $738.2 million in 2020. We declared and paid $174 million in common stock dividends as compared to $136.1 million last year. an increase of 27.8%. For the full year, we've paid income taxes of $310.4 million, and that compares to $244.4 million in 2020. Our accounts receivable DSO was down to 49.5 days compared to 50.8 days as of September 21, and 48.4 days as of December 2020. Capital expenditures in capitalized software was $136.6 million, which is about 2.7% of adjusted revenue, compared to $106.4 million in 2020. Spending was predominantly for capitalized software and IT infrastructure. Option exercises proceeds for the year were $197.7 million for $5 million shares compared to $189.7 million for 6.3 million shares last year. Our consolidated EBITDA, which are used for our covenant compliance, was $2.66 billion and includes $1.3 million of acquired EBITDA and cost savings related to our acquisition. And based on that debt of $5.6 million, our total leverage ratio was 2.69 times and our secured ratio was 1.72 times. On our outlook for the year, I'll first cover some high-level assumptions. As we're focusing on client services, we expect retention rates to continue to be in the range of most recent results. Ending acquisitions are not included in our current 2022 guidance. We have assumed foreign currency exchange will be at the current levels. As a result, adjusted organic growth for the year will be in the range of 2 percent to 6 percent. And adjusted organic growth for Q1 will be in the range of 1.9 percent to 5.1 percent. On interest rates, we have assumed for the near term it will be 30-day LIBOR plus the spread of 175 BIPs. In mid-year and the latter part of the year, we've assumed a three- to six-month LIBOR plus the spread. We expect staff costs to increase due to continued wage inflation, and we will manage our expenses during this period by controlling variable expenses to maintain our operating margins. And we'll continue to invest in our business with capital expenditures of approximately 2.8 percent of revenue. Now, free cash flow will continue to allocate both to debt pay down and stock buybacks. And we expect the adjusted tax rate to continue to be approximately 26 percent. So, for the first quarter of 2022, we expect revenue to be in the range of $1,258 million to $1,298 million. Adjusted net income in the range of $326 million to $343.5 million. and diluted shares in the range of $268.3 million to $267.8 million. For the full year of 2022, we expect revenue in the range of $5,130,000 to $5,330,000. Adjusted net income in the range of $1,375,000 to $1,445,000 and diluted shares in the range of $269.5 to $267.5 million. And on operating cash flow, we expect the full year to be in the range of $1,440,000,000 to $1,510,000,000. And I'll turn it over back to Bill for final comments.
spk05: Bill, you might be on mute.
spk04: I'm proud to announce that we have completed our SS&C's Private Cloud SOC 1, and we are very close to our SOC 2 on our Private Cloud, which we expect to have within a week. These types of audits require an enormous amount of coordination and commitment. Not only have we delivered on our contractual commitments to customers, but our sales staff is busy showing prospects. We are one of the first companies with a SOC 1 and SOC 2 certified private cloud offering. Stay tuned as we roll out products and services which utilize this hyper-secure, robust, and lightning-fast technology. I'll now open it up for questions.
spk12: At this time, I would like to remind everyone In order to ask a question, press star followed by the number one on your telephone keypad. In the interest of time, we request you limit yourself to one question and one follow-up question. Thank you. Your first question comes from the line of Mike Young with Truist Securities. Your line is open.
spk10: Sorry about that. I was having a bit of an issue with my mute button as well. Thanks for taking the question. I just maybe wanted to start with the commentary about the staff cost increases and trying to, you know, offset those with some other cost savings. You know, just as we kind of look forward to next year with kind of a revenue guide in line with current expectations, should we think of kind of the EBITDA margin as a normal, you know, kind of slight expansion year over year, or do you think there will be some some pressure on that given kind of some of the dynamics with inflation?
spk04: Well, I mean, we're not immune, right? We are in businesses that our employees are highly sought after, and, you know, they're a great team. And, you know, the raises and bonuses are going to be larger and more frequent. But we also are going to have lots of productivity gains, and we think that we will be able to expand our margins, you know, in the 50 to 75 basis points. And if we get a little tailwind, maybe we'll do a little better.
spk10: Okay, that's helpful. And maybe just as a follow-up, as we kind of think about maybe the business as a whole or specific business lines, how much does kind of inflation play into contract pricing and how much of a tailwind should we be expecting as a part of that next year?
spk04: Well, you know, our customers are like Truist and other sophisticated users of technology and financial resources. financial accounting and investment accounting and reporting and tax accounting and reporting. So, you know, they're aware. They're aware that our costs increase, and they want to keep the same staff as we have on our clients. And that's what really gets our people to work hand in glove with our clients. And so, you know, people understand when costs go up, prices have to go up. And I think that that That is something that, you know, we are very cognizant of, and we have focused on it for the last two or three years. And I think that while nobody likes price increases, people certainly understand.
spk12: Your next question comes from the line of Surrender Thinned with Jeffries. Your line is open.
spk06: Thank you. Bill, I'd like to start with a question about the revenue guidance for next year. It sounds like the adjusted organic growth is going to be in the 2% to 6% range for the full year. Can you put that in the context of Investor Day, where you talked about 4% to 7% longer term? Is it near-term headwinds that you're seeing? Are clients thinking about delaying projects? How should we think about what we heard at Investor Day a few months ago versus what the guide is currently?
spk04: Well, you know, again, we're trying to, you know, maybe be a little conservative, but certainly be realistic and make sure. It's a pretty uncertain time right now with the speculation on interest rates, you know, The regulatory environment is constantly changing, and, you know, when you see as much M&A activity as you do today, you know, a lot of times our clients can merge too. So, you know, we're trying to be realistic, and, you know, we've been able to surprise positively for a few quarters, and I am hoping that – that a bunch of business comes in. We have full pipelines. We've got great products coming out, so we have some optimism, but we also want to temper that with realism.
spk06: That's helpful. And then as a follow-up to the earlier question about it sounds like you're still expecting to be able to expand margins by about 50 to maybe 75 basis points this year. Is there a bridge that you can provide us there in the sense that Um, obviously there's wage inflation, um, and then are you able to pass most of that or some of that costs onto clients or how should we think about that versus the productivity initiatives at this point? Um, just trying to get an idea for the balance of how to think about the push pull on margins at this point.
spk04: Well, I mean, again, you know, we, we don't control inflation and, um, You know, like everybody, you know, we I think last year hired, you know, 5.7 thousand people. Right. So that's a lot of people, you know, and so that's a lot of training and that's a lot of education. And, you know, that's a lot of administration. So, you know, our costs are going to go up. And, you know, when it's inflationary, they're going to go up more. And, you know, we're going to compete. and we're going to compete hard, and we're going to deliver superior service to our clients in a period where we believe that a number of our competitors are going to deliver inferior service. And that's the opportunity, and that's, you know, one of the ways in which, you know, if our win rates go up and our price is firm, our margins are going to go up. Rahul, you might have something to add.
spk10: Bill, in addition to the productivity and the labor force dynamics that you covered, we still have some opportunities on things like enterprise contracts that are coming up for renewal and third-party software and discretionary spend. So in addition to obviously making sure that we've got highly motivated employees that are continuously innovating and making our processes better, we also keep looking at other areas in which to control costs and all of those things together. ought to result in some margin improvement.
spk06: That's helpful.
spk12: Thank you. Your next question comes from the line of Peter Heckman with DA Company. Your line is open.
spk11: Thank you. Yeah, this is John on for Pete. Just a quick one. Within fund administration, have you guys seen any change in the competitive dynamics over the last year?
spk04: Well, I think if you look at the league tables, you'll see that, you know, Apex is, you know, is buying everything in sight. And so they're getting larger. And, you know, but, you know, they've done a number of acquisitions. They got a couple of them left on the limb to finish, I think. But acquisitions are challenging. And my guess is it's challenging for them. So, you know, other than what they have done, I don't think there's been that much of a difference in our competitive landscape. Would you agree with that, Rahul?
spk10: I would, Bill. I'd also say, you know, if you look at our growth rates, you know, our business is accelerating, right? So the other change in dynamic is that as we continue to build products and services and get more and more scaled, our ability to compete and enhance that win rate is, you know, it just gets a little bit better every year. And that's what we saw this past year.
spk11: Got it. Got it. And I know the acquisitions aren't included in the current 2022 guide, but just wondering, how should we look at the, you know, potential contribution of the OSHA ETF and HubWise deals?
spk09: I think, Mr. Patrick, I think Hawaii's is fairly small. It might be around $8 million of revenue. And O'Shares might be around $29 million of revenue.
spk11: Got it. Thank you so much.
spk09: But they're both not included, as we indicated.
spk12: Your next question comes from the line of Andrew Schmidt with Citi. Your line is open.
spk03: Hey, guys. Thanks for taking my questions. I like this slide you have in the investor deck that suggests organic growth by business. It highlights the good growth in the alternatives business in 2021. I was wondering if you could talk about the expectation within the organic growth guidance for alternatives for 2022. and particularly how you think about potential, you know, if we do see market volatility continue, what impact it could have on that business. Thanks.
spk09: Patrick, I think at the midpoint of our guidance, you know, we expect the fund administration growth in the high single digits for 2022. So it continued to be higher than, you know, historical.
spk04: And while there's been volatility at different times, you know, if you look at the chart of our capital markets or capital movements indicator that we publish every month, you know, since 2011, I think it's almost a straight line north. You know, so I think that, you know, the talent in the alternatives business, you know, match to the, you know, breadth of investments and strategies that that talented group of people have, I think, bodes well for the alternatives. We see nothing but – but increased interest from very large-scale fund companies, from very large-scale institutions, from very large-scale sovereign wealth funds and governments. So I see, if anything, that in our guidance and stuff, that our alternative guidance might be the most conservative of all.
spk03: Got it. That's pretty constructive. I appreciate that. And then just in the fourth quarter and maybe into the first quarter, did Omicron have an impact on sales pipeline or deal closing? Just wondering if it might have temporarily slowed things down, which might imply some pent-up demand at some point in the first quarter into the second quarter. Thanks.
spk04: Well, like everything, right? Everything is Omicron related. There aren't any automobile deaths anymore. They're all or also Omicron or some other COVID derivatives. But I think that 6.9% organic growth off of a pretty good Q4 of 20 is pretty solid, you know. And I think, you know, as I think Surinder said before, our 4 to 7 that we talked about on analyst day, you know, that's at the high end of the 4 to 7. We, again, are focused on organic growth, and even the acquisitions that we've done are really, we think, are going to be very additive to our product offerings and the scope and capabilities that we're going to be able to offer across our entire product lines.
spk12: Your next question comes from Jackson Ader with JP Morgan. Your line is open.
spk10: Great. Thanks for taking our questions, guys. The first one is on Blue Prison. It kind of has a different financial profile than some of the other recent acquisitions that you've made. So just curious, any initial thoughts on, you know, what the integration or strategy after closing might look like relative to some of the the different acquisitions that you've made in the past.
spk04: Yeah, Jackson, we're really not in any position to comment on Blue Prism. And, you know, the London and UK takeover board frowns for us to say anything. So we think that that should close in the late Q1 or Q2, and we'll be happy to set up a call with you at that time.
spk10: No big deal. You know, felt like I had to ask. And then the follow-up question, with retention rates and AUA both kind of ticking down, I'm curious how much of an impact maybe those lower retention rates had on assets versus maybe market factors.
spk04: Yeah, I don't think, you know, we're going to get a little bit of fluctuation with our with our AUA, both with market values and then also when certain clients, you know, launch new funds or even shut down funds. And I do think we had one sovereign wealth fund with a lot of assets, but very few services. So the amount of a drop, you know, could have been, you know, 30, 40, 50 billion, but I don't think we made very much money on it because they didn't take very many services, right? So, so we don't do that as much of a, much of a headwind. And I think, I think in the first quarter of 20, we were at 2 billion, 150, and we're now at, you know, two, two, to 1.7, I think. So, I think we have a very strong business, and it's getting stronger. Male Speaker 1 Okay. All right. Thank you.
spk12: Male Speaker 2 Your next question comes from the line of Chris Donat with Piper Sandler. Your line is open.
spk10: Chris Donat Good evening. Thanks for taking my question. Bill and Raul, I just want to follow up on that last one about the AUA. Just looking at slide 12, I was a little surprised at the reduction quarter on quarter in AUA. And, Bill, you just made the comment about the sovereign wealth fund. And I know you've got a higher mix of fixed income assets than probably equities-focused people like me think about. But can you just help me understand the sequential decline? And, again, I'm equity biased, so I think about the S&P 500 being up like 10.5% in the fourth quarter. So I'm probably looking at the wrong – or a fraction of the benchmark.
spk04: Yeah. You know, again, you know, like I said, we're going to have some fluctuation in this, but I would say that, you know, over time, we have really grown. Yeah, I think the first quarter of 2020, we were at $1.7 trillion, and now we're up, you know, almost $500 billion. in two years. And if you look at the league tables in this, I think $500 billion, you get to be about fifth in the league tables. You're fifth or sixth. And so, you know, and I think that it was up, you know, I mean, Rahul's up Middle Eastern, Southern Western. Yeah.
spk10: Yeah, that's right. So there's, there's one, you know, one sort of a one off in there, which is like Bill just said, there's a nearly $50 billion AUA in a single customer that paid us less than a million dollars a year. Right. So so that's the that's that I think is the biggest reason the underlying other metrics on new funds, new business that we have won, you know, performance driven growth, things like that continue to be in line with historical averages.
spk04: And we would comment a little bit that, you know, we have very strong pipelines and we have a very strong sales force and they're executing.
spk10: Okay. Thanks for clarifying that one. And then for Patrick, I would also appreciate seeing the organic growth by business broken out. Just thinking about the software businesses and DST financial, are the Organic growth rates for 2021, probably the best way to think about growth rates for 2022?
spk09: I think so. I think the major changes we'll see in 2022 is, you know, we're expecting a decline in our healthcare business in 2022. And currently we're You know, we expect the growth rate of interlinks to continue to be double digits, but not as high as 2021. And the vast majority of the other product lines will be pretty similar.
spk08: Male Speaker 1 Okay. Thanks very much, Patrick.
spk12: Male Speaker 2 Your next question comes from the line of Kevin McVey with Credit Suisse. Your line is open.
spk02: Great. Thanks so much. I wonder if you could just talk into the revenue guidance for 2022. It looks like the range is 2% to 6%. Last year, it looks like the range was about 200 basis points from the low to the high end. Any sense of the puts and takes on what we get to the low end this year versus the high end and why you widened out the range a little bit?
spk09: I think the range in 2020 was somewhere around $180 million, and now it's $200 million. I don't think it's that much different from what I recall.
spk02: Okay.
spk09: In absolute dollars.
spk02: Okay.
spk09: That's what I recall, but I can get back to you if you want.
spk02: Okay. Maybe follow up offline. Can you just remind us of the seasonality? I know there's some year-end work, things like that. Does that fall into the first quarter in terms of the filings and things like that? Is there any way to think about what the impact is on the quarter in that?
spk04: Well, there's a little more tax and financial statement work in the first and second quarters than third and fourth quarters. I think that's the primary seasonality that we have. Is that right, Rahul?
spk10: That's right, Bill. And the other one is just there tends to be a little bit more license in Q4. Great.
spk12: Thank you. Your next question comes from the line of Jason Fawcett with Morgan Stanley. Your line is open.
spk08: Hey, it's Jonathan on for James. Appreciate the appreciate the color here. Can you provide an update on sort of the M&A environment from what you're seeing? Obviously, you're waiting on two deals to close. But are you seeing any other attractive targets on the market? And sort of what assets would you be looking for from a capability or geographic perspective?
spk04: Yeah, I think there's, there's a number of properties that are that are in the market or coming to the market that we will have some interest in. You know, FinTech has kind of reset as far as price is concerned, if you look across the horizon. So, a number of FinTechs that were trying to get public didn't get it out. And, you know, some of the ones that cut out early in the year have, you know, kind of come back to, you know, just moderate nosebleed levels instead of extreme. You know, so that gives us a lot more stuff to take a look at. But at the same time, right, we're going to push hard to get that organic revenue growth up. And so, you know, the acquisitions have to have a higher hurdle. And, you know, we have a lot of people that want to do acquisitions within SS&C, but they recognize that if they don't have organic revenue growth, we don't have much capital for their acquisition plan. So it's trying to have a discipline in the process that everybody understands that, you know, we always want to back our best businesses.
spk08: Thanks for that color, Bill. And I want to build on some of the questions I've already been asked around sort of the pricing environment and wage inflation. You know, how are you thinking about the magnitude and timing of price increases through the year and just given some of that wage inflation that you're seeing in the market?
spk04: Yeah, I mean, Jonathan, that's a great question. And, you know, it is one that, you know, we've given a lot of thought to, and we're trying to figure out, you know, different ways in which to – make SS&C a great place to work, you know, make sure that we pay very well and that we're extremely competitive. And so on that side, you know, that is just, you know, what the labor market demands, and it's something that, you know, we're well aware of. You know, in a lot of ways it's running a business. And, you know, when your costs go up, you know, if you don't send your prices up, you know, obviously your margins are going to get hammered. So, you know, we're not that anxious of getting hammered. So, you know, we're focusing on those things and working hard with our clients to make sure that when they have issues that they need to have solved, that, you know, it's our number they call. You know, so that, as you see, we came out with a press release, I think a week ago or so, and about our treasury management system. And we just did a seminar, I think, today where we had 277 people lined up or signed up to come to our webinar on our new treasury management system. We have another product coming out in very short order called Go Central that we're really excited about. So, you know, we've got a lot of stuff happening. And, you know, you've got to execute. You've got to win. You have to have satisfied clients. And have to be upfront and, you know, brutally honest with everybody so that we can get on with doing the things that are necessary to have a business.
spk08: Loud and clear. Thanks, Bill.
spk12: Your next question comes from the line of Alex Cram with UBS. Your line is open.
spk01: Yeah, hey, hello, everyone. Just on the healthcare comment from earlier with the decline, hopefully I got this right, but can you flesh it out a little bit more? I mean, very recently you sounded super bullish on that business, so just want to make sure I didn't miss anything there, and maybe related, I think you're hoping to get some more partners into the Domani JV, so maybe any updates there would be great. Yes.
spk04: Yeah, I mean, we remain very optimistic. You know, we have a number of people that are trying to become partners and customers. We have, you know, knock on wood, had a lot of progress on the development side. And so we're optimistic about that. And, you know, hopefully we will have some
spk10: some uh announcements on on health care over the next quarter or two that are that are quite positive is that how you would look at it that's right bill we're making uh we're making really good progress on the new system that we're building and and have lots of great support from our partners and in regards to the decline uh why is this business going to be down this year remind me please There's some attrition on the medical claims side, so Domani is very focused on pharmacy. And on the medical claims side, we have some attrition, some we've known about, and we're going to need to overcome that this year.
spk01: Yeah, okay, thanks. Thanks for the reminder. And then just real quick in terms of capital allocation, not sure if this came up already, but I know obviously you've got Blue Prism here soon, but outside of that, given the cash flow that you're throwing off, You know, you already delivered decently. Like, so should we assume buybacks can continue at a pretty attractive pace, or how should we be thinking about the remainder of the cash in absence of any deals?
spk04: Yeah, you know, again, Alex, we're trying to be as wise as we can be. I would guess, you know, given that, you know, the term market is still pretty strong, uh, the, the high yield market, not as, uh, so, you know, I, I would imagine that we will be, uh, pretty active in, in buying back our shares and, and, you know, we'll still pay down a, a, a good amount of, of debt. And, you know, obviously we're not, you know, we're not paying down our 2% debt so we can just refinance it on blue prism at 3% or three and a half. So, so we, we have a whole lot of cash that we'll use in, in, um, in closing these acquisitions and then, and then, you know, but we're still generally like, like, you know, as you, as you saw, we generated, you know, almost a quarter of a billion dollars in cash above what we did in 2020. So, you know, at a billion, four 29, you have an awful, awful lot of flexibility and an awful lot of optionality.
spk01: Very good. Thank you very much.
spk12: Your final question comes from the line of Patrick O'Shaughnessy with Raymond James. Your line is open.
spk07: Patrick O'Shaughnessy Hi. Good evening. On the M&A front, do you think getting regulatory approval for larger acquisitions is going to be incrementally more challenging going forward, given the current stance of global regulators? Or would you anticipate largely steering clear from extended antitrust reviews?
spk04: Raymond James Well, I mean, again, Patrick, you know, we're not anxious to have antitrust reviews, as you can imagine. At the same time, the more attractive an acquisition is, you know, the more dogged we will be to close it, you know, and hopefully that's the way that we drive success in our M&A activities and, you know, But we're getting big, right? So we're not going to be able to, you know, hide.
spk07: Got it. Okay. And then staying on the regulatory theme, do you guys have any preliminary thoughts on how the SEC's proposal to increase disclosure requirements on private fund managers might offer either opportunities or threats to SS&C?
spk04: I think it's primarily an opportunity to help our clients you know, with additional regulation, and we're optimistic in our ability to do that.
spk07: All right. Thank you.
spk12: There are no further questions at this time. I would now like to turn the call back over to Mr. Bill Stone for closing remarks.
spk04: Thanks, everybody. We look forward to talking to you at the end of Q1, and Stay healthy and stay safe, and we'll talk to you in 90 days or so. Thank you.
spk12: Ladies and gentlemen, thank you for your participation. This concludes today's conference call. You may now disconnect.
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