PRESS DIGEST- New York Times business news - March 23
March 23 The following are the top stories on the New York Times business pages. Reuters has not verified these stories and does not vouch for their accuracy.
June 28 Fitch Ratings has affirmed its ratings for Broadridge Financial Solutions, Inc. (Broadridge). The ratings and Outlook are supported by the following considerations: --Broadridge has a leading share in the proxy distribution market, which Fitch views as facing minimal competitive threats and pricing that is largely insulated by SEC regulations; --The company's core Investor Communications and Securities Processing business segments produce steady free cash flow with minimal exposure to economic volatility; --Long-term customer contracts and customer relationships in both core businesses; --Broadridge has a diverse customer base with no customer representing greater than 7% of total revenue, and expectations of achieving greater geographic diversification by capitalizing on growth opportunities in international markets going forward; --The low capital intensity of Broadridge's business model has produced high historical returns on invested capital. Ratings concerns include the following: --Changing regulations could negatively impact Broadridge's business, particularly related to the proxy distribution business; --Broadridge's acquisition growth strategy carries integration and execution risks; --Execution risk related to the company's processing of confidential client information and the risk of security breaches as well as operating risks stemming from the mission-critical nature of the company's securities processing solutions. The ratings reflect the following financial expectations: --Broadridge can organically grow revenue in the low- to mid-single digits with periods of higher growth driven by acquisitions; --EBITDA margins should rebound closer to the historical average of 20% going forward once the migration of processing services to IBM is completed; --Free cash flow to adjusted debt is expected to remain within a range near 20% with adjusted debt to EBITDAR of approximately 2x or less. Fitch currently estimates free cash flow to adjusted debt at 18.2% and adjusted debt to EBITDAR at 2.1x; --Broadridge will utilize excess free cash flow for share repurchases and acquisitions; --Quarterly results will remain volatile depending on the level of event-driven revenues but as Broadridge continues to diversify its business beyond proxy services, year-to-year volatility in results will be reduced. Liquidity as of March 31, 2012 was solid at $719 million, which includes $219 million in cash and $500 million available under the company's $500 million senior unsecured revolving credit facility which matures in September 2016. Fitch expects annual free cash flow to average between $150 million and $200 million. Total debt as of March 31, 2012 was $564 million, with $440 million outstanding under a senior unsecured term loan facility which matures September 2016 and $124 million in senior unsecured notes due June 2017. Fitch affirms Broadridge as follows: --Issuer Default Rating (IDR) at 'BBB+'; --Senior unsecured revolving credit facility at 'BBB+'; --Senior unsecured debt at 'BBB+'.
* Checkers Drive-In Restaurants has agreed to be sold to Oak Hill Capital Partners for $525 million in deal expected to be announced on Thursday - WSJ