FactSet Research Systems Inc.

Ladies and gentlemen, thank you for standing by, and welcome to the FACSET Q1 earnings call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question-and-answer session. To ask a question during the session, you need to press star 1 on your telephone. If you require any further assistance, please press star then 0. I would now like to use your audience conference call, Ms. Rupa Heider. You may begin.

Thank you, Kevin, and good morning, everyone. Welcome to FACSET's first quarter of 2021 earnings call. We continue to be in various remote locations today. We may have some audio quality issues and we appreciate your patience should we experience a disruption. Before we begin, I would like to point out that the slides we will reference during this presentation can be accessed via the webcast on the investor relations section of our website at faxit.com. The slides will be posted on our website at the conclusion of this call. A replay of today's call will be available via phone and on our website. After our prepared remarks, we will open the call to questions from investors. To be fair to everyone, please limit yourself to one question plus one follow-up. Before we discuss our results, I encourage all listeners to review the legal notice on slide 2, which explains the risks of forward-looking statements and the use of non-GAAP financial measures. please refer to our forms 10-K and 10-Q for a discussion of risk factors that could cause actual results to differ materially from these forward-looking statements. Our slide presentation and discussions on this call will include certain non-GAAP financial measures. For such measures, reconciliation to the most directly comparable GAAP measures are in the appendix to the presentation and in our earnings release issued earlier this morning. Joining me today are Phil Snow, Chief Executive Officer, and Helen Chan, our Chief Financial Officer. I would now like to turn the discussion over to Phil Snow.

Thanks, Reema, and good morning, everyone. I'm pleased to report that FACSA has started its fiscal year on track to meet its first half goals. We've learned a lot over calendar year 2020, how resilient our business is, how well we can work remotely, and the strength of our client relationships. The last 12 months have also served as a reaffirmation of our investment strategy in content and technology. FactSet's focus on supporting client workflows across the entire portfolio lifecycle is increasingly serving as a differentiator for us in the market, and we enter the new calendar year with increased visibility and measured confidence in our position. Our focus remains on maintaining our already high client retention, adding new clients, expanding wallet share with large strategic clients and continued pricing discipline as we seek to capture more market share. Strong execution will be key to performance this fiscal year and we are optimistic in our ability to close our pipeline. Our second quarter pipeline is higher now than it was at this point a year ago and we have proven that we can execute well. Ultimately, We provide clients with critical data that is only increasing in importance. The demand for more and more differentiated content is at an all-time high, especially on the buy side, and FactSet's depth and scale in this area place us in a solid position. We believe we offer the strongest data concordance in the industry, and this strength, coupled with FactSet's comprehensive suite of open and flexible technology solutions, are driving more engaged and actionable C-suite level conversations. Moreover, our ability to link diverse content and convert unstructured data into structured meaningful financial insights is a key differentiator for us in the industry. We are the provider of choice for many of our clients looking to scale their technology and migrate their workflows to the cloud. We further improved our content and technology this quarter with the exciting acquisition of True Value Labs, one of the strongest ESG providers in the industry. I'm very pleased with the demand we see from clients and the speed with which we're integrating this company into the FactSet ecosystem. They were already a provider on the open FactSet marketplace and one of the many ESG data providers on our platform. True Value is pioneering AI technology Their alignment with SASB and the UN SDGs combined with our existing library of content creates a powerful engine for data collection and signal creation that will certainly add value for clients across all our businesses. As we look at Q1, the growth rate for organic ASV plus professional services decelerated by 40 pips over the last three months, ending at 5%. Our research business, which primarily experienced higher growth due to stronger retention, helped support the ASV growth this quarter. The strength in research was offset by delayed decision-making that slowed our ability to close deals, as well as higher cancellations in other businesses. We also saw an increased level of activity in new business, as well as expansion with existing clients. As we've said before, the first quarter typically tends to be our smallest quarter and is not necessarily an indication of our performance for the remainder of the year. We're also pleased with improved results for both the adjusted operating margin and EPS this quarter, driven by higher operating results. Helen will walk you through the details in a few minutes. Turning to our regional segments, in America's strong retention and expansion of our research solutions with our largest clients, especially banks and asset managers, help sustain growth in this region. As we enter our second quarter of 2021, we anticipate closing on large deals within wealth, banking, and asset owners that we believe will help us stay on track to meet our first half goals. Our EMEA region contracted this quarter, largely impacted by cancellations. There is a heightened focus by the sales team to mitigate these cancellations by increasing new business with ESG as a central theme. We have plans to deploy the True Value Lamps product as a differentiated offering in this region. We also continue to see good opportunities in EMEA for our CTS and analytics solutions. In Asia Pacific, the ongoing conversations with clients around digital transformation and portfolio lifecycle are helping to build a strong pipeline across different markets. The Q2 pipeline looks strong, as some large deals, largely in our analytics business, were pushed from Q1 into Q2 as they neared their final stages of closure. We also see solid demand for CTS data feeds across the region, and our new business pipeline reflects that. We have conviction in the second quarter pipeline across all regions, stemming from the demand we see for our products, especially with our end-to-end portfolio lifecycle solutions. We are the only provider of integrated solutions that originate in portfolio research and end with client reporting. We are targeting the front office with these robust research and analytic solutions, tapping into clients' technology budgets with digital transformation, focused on thematic-based selling, especially with ESG products, and continuing to provide holistic, open, and flexible solutions. This sets us up well to meet our goals for the first half of the year. In summary, I'm proud of our team for delivering solid results this quarter. We are reaffirming our fiscal 2021 guidance. As we look at the world today, we are more confident than ever that the early investments we made in content and technology, coupled with solutions that cover the entire portfolio lifecycle, increase FACTS' value to our clients. While the short-term environment continues to be affected by the prolonged pandemic, we are taking the necessary steps to meet our goals this fiscal year. We are doing all this while maintaining cost and capital discipline across the organization. The relationships with our clients have strengthened during the pandemic, allowing us to build an even stronger Q2 pipeline than we saw at this time last year. Above all, we have an exemplary team that has demonstrated again and again its ability to execute. I'll now send things over to Helen, who will take you through the specifics of our first quarter performance.