Donnelley Financial Solutions Inc

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thank you good morning everyone and thank you for joining donnelly financial solutions third quarter 2024 results conference call this morning we release our earnings report including a set of supplemental trending schedules of historical results copies of which can be found in the investor section of our website at bfin solutions.com during this call we'll refer to forward-looking statements that are subject to risks and uncertainties for a complete discussion please refer to the cautionary statements included in our earnings release, further detailed in our most recent annual report on Form 10-K, quarterly report on Form 10-Q, and other filings with the SEC. Further, we will discuss certain non-GAAP financial information, such as adjusted EBITDA, adjusted EBITDA margin, and organic net sales. We believe the presentation of non-GAAP financial information provides you with useful supplementary information concerning the company's ongoing operations and is an appropriate way for you to evaluate the company's performance. They are, however, provided for informational purposes only. Please refer to the earnings release and related tables for GAAP financial information and reconciliations of GAAP to non-GAAP financial information. I am joined this morning by Dan Lieb, Dave Gardella, and other members of management. I will now turn the call over to Dan.

Thank you, Mike, and good morning, everyone. Our third quarter results offered further validation of our strategy, including a favorable sales mix driven by double-digit growth in our SaaS offerings, improvements in both operating cash flow and free cash flow, and great progress in expanding the adoption of our offerings in the marketplace. Against the backdrop of a soft capital markets transactional environment, which resulted in an 8% reduction in our transactional revenue, we delivered solid results. With net sales of $179.5 million and adjusted EBITDA of $43.2 million, resulting in an adjusted EBITDA margin of 24.1%, which once again demonstrated the resiliency of our operating model across various market conditions, and the sustainability of our performance as our business mix continues to transform. Dave will cover our results in more detail, including some items that negatively impacted our year-over-year profitability comparisons. Specific to our third quarter performance, I am pleased with the continued strong demand for our software offerings, where we delivered year-over-year organic net sales growth of 13.6%, a continuation of the strong growth rate we achieved in the first half of this year. Software solutions net sales represented approximately 46% of total net sales in the quarter, the highest level we have achieved to date. More significantly, third quarter software solution sales were, for the first time, meaningfully higher than both tech-enabled services and print and distribution sales. As our software offerings serve recurring and reoccurring business needs of our clients, This offers another positive proof point of our progress in transforming DFIN. On a trailing four-quarter basis, Software Solutions net sales reached nearly $322 million, growing 13.1% on an organic basis from the third quarter 2023 trailing four quarters, and represent 40.1% of trailing four-quarter sales, an increase of approximately 360 basis points from the third quarter 2023 trailing four-quarter sales. Our third quarter software solutions net sales growth continues to be led by the performance of Venue, which posted approximately 27% sales growth, despite overlapping last year's strong third quarter. We remain encouraged by Venue's outstanding performance, which is primarily a result of strong sales execution. In addition, the growth rates of our recurring compliance software products, ArcSuite, and Active Disclosure, each improved in the third quarter compared to recent trend. Within ArcSuite, we realized incremental software revenue from our tailored shareholder report solution. We are encouraged by the level of client adoption of our software solutions for tailored shareholder reports and remain on track to achieve $11 million to $12 million of incremental recurring software revenue on a full year basis, with approximately half being recognized in 2024. In addition to positive client feedback, our leadership-tailored shareholder reports compliance is being recognized more broadly within the investment management industry. Earlier this week, DFIN was awarded the 2024 NOVA Award for Industry Innovation and Product Development, presented by NCSA, the Global Asset Management Trade Association. The award honors DFIN for its outstanding leadership product development, and innovative marketing approach in response to the Tailored Shareholder Reports regulation. We have spoken in the past about the creation of a platform that leverages capabilities across DFIN in areas such as composition, tagging, filing, and regulatory and financial reporting, while maintaining client segment unique capabilities. Our award-winning Tailored Shareholder Reports solution is a great example of the benefits of the platform. We leverage foundational capabilities while building new requirements to serve the market. As it relates to active disclosure, while the overall growth rate improved modestly in the third quarter compared to recent trend, the subscription component of active disclosure grew at a faster pace in the quarter, reflecting the increased sales momentum from recent wins, combined with overlapping last year's product transition. The stronger subscription revenue growth was partially offset by lower Section 16 beneficial ownership filing activity as the demand for such filings continues to be impacted by a weak IPO market. Looking ahead, we expect the growth rate for active disclosure to continue to improve in the fourth quarter of this year and into 2025. Within active disclosure, which also leverages platform capabilities, we are serving additional use cases via a hybrid model that combines our software solution with an unmatched service offering. For example, active disclosure serves the IPO registration and proxy statement use cases, which historically were managed in a traditional model. And we have received outstanding feedback from clients regarding their ability to work in a way that leverages the full spectrum of our solutions. Finally, our mix shift was accelerated by the continued reduction in print and distribution revenues. which declined by $4.3 million, or 16.3%, year over year. This reduction took place both in the printing and distribution of capital markets compliance documents, as well as lower print volume in the investment company's business as a result of the tailored shareholder reports regulation. As a reminder, the tailored shareholder reports regulation eliminated the demand for full-length shareholder reports at the fund level and replaced them with two- to four-page summary documents at the share class level. While we experienced an increase in printing and distribution volume from the additional share class documents, primarily within the regulated insurance segment, that increase in demand was more than offset by a reduction in the overall size of the reports mandated by the TSR rule. We expect this dynamic to continue in the fourth quarter in addition to the broader secular decline in the demand for printed products, resulting in lower print and distribution revenue. Before I share a few closing remarks, I would like to turn the call over to Dave to provide more details on our third quarter results and our outlook for the fourth quarter. Dave?