Good morning, and welcome to the Broadridge fiscal 3rd quarter earnings conference call. All participants will be in listen only mode. After today's presentation, there will be an opportunity to ask questions Please note this event is being recorded. I would now like to turn the conference over to Eddings Thibaut, Head of Investor Relations. Please go ahead.
Thank you, Andrew. Good morning, everyone, and welcome to Broadridge's fiscal 3rd quarter 2020 earnings call. Our earnings release and the slides of the company this call may be found on the Investor Relations section of Broadridge.com. Joining me on the call this morning are Tim Gokey, our CEO and our CFO, Jim Young. Before I turn the call over to Tim, a few standard reminders.
We will be making forward looking statements on today's call regarding that involve risks. A summary of these risks can be found on the second page of the slides and a more complete description on our annual report on Form 10 K. We will also be referring to several non GAAP measures, which we believe provide investors with a more complete understanding of Broadridge's underlying operating results. An explanation of these non GAAP measures and reconciliations to their comparable GAAP measures can be found in the earnings release and presentation. Let me now turn the call over to Tim Gokey.
Tim?
Thank you, Edings. Before turning to our financial and strategic results, I want to start with the human impact of the COVID virus. As it continues to extend its reach around the and nearly 10,000 associates and family members in the New York Metropolitan area. Our team is seeing up close the toll this virus has taken on so many. We have lost coworkers, family members, friends, and neighbors.
And our hearts go out to all of them and to the many still fighting this disease. We also see economic dislocation experienced by so many in our communities here and around the world These are challenging and difficult times. Our focus has helping them meet the incredible challenges they face around the world. Seeing how our teams are supporting one another, their families, and our clients, all in the face of wrenching change has been inspiring. Thank you.
With that important backdrop, let me lay out where we've been, where we are, and where we're going beginning on Slide 5. Despite the challenges in the New York area Broadridge as a global company is resilient, is performing well. And has real opportunity ahead. The COVID crisis has reinforced the essential nature and the importance of as they carry out their essential duties. That strength led to continued growth and solid financial results in the third quarter, on which Jim will elaborate further.
Finally, as we look forward, we see real opportunity Let's move onto Slide 6. These unprecedented times have reaffirmed the essential nature of what Broadridge does. In these volatile and uncertain times, the critical infrastructure powering, investing, governance and communications has never been more important. Throughout the crisis, our scalable and resilient technology platforms have processed remarkable market volumes that are multiples of normal. Supporting our capital markets and wealth management clients, enabling end investors to buy and sell securities generate liquidity, fund new investments, and react to a rapidly evolving outlook.
This performance will continue to be We have also enabled tens of millions of investors to track their holdings and other key information through periods of high uncertainty and volatility. From distributing 1,000,000,000 of dollars of checks to sending and receiving voting information to reassuring investors with timely confirmations and statements the flow of information has remained open. Finally, now more than ever, strong corporate governance is critical. As companies come to grips with unprecedented economic and health challenges, the role of the Board of Directors has never been more important. We're proud of how our technology and people have insured companies can conduct their annual meeting safely, while enabling continued shareholder engagements.
As a result of our central role in securities trading and corporate governance, many of our operations have been deemed essential service providers under guidance provided by the federal government and other governmental authorities. We have been in constant contact with the SEC and other regulators to help them better understand resiliency and challenges faced by our financial system as trading volumes spike and companies moved their annual meetings online. 11 states to date have provided temporary relief to enable virtual only annual meetings, reinforcing the importance of strong and timely corporate governance. Next slide please. This essential work is possible only to our engaged and deliver for satisfied clients leading to strong financial outcomes, defines our culture and sits at the heart of our delivery.
That's our thinking from the beginning of the crisis started with the health and safety of our nearly 13,000 associates around the globe. We first instituted a work from home policy in Asia as COVID began to spread in January. As the pandemic became more widespread in March, we moved quickly to Institute work from home mandates for all of our non production associates in Europe, and North America. By mid March, we extended that to include India. We are now operating fully on a work from home basis, for the 87 percent of associates not involved physical production.
As work from home is a normal part of our business continuity planning, This is a smooth transition. We've also taken strong measures to ensure the safety of our production associates. Working closely with our on-site medical teams and third party experts and in line with CDC guidance, We equipped our associates with masks and gloves, closed cafeterias and instituted on-site food delivery. We removed economic pressure to work by providing extended leave for those who are ill, quarantined, or they or a family member are in a high risk group. We mandate temperature checks at the beginning of every shift.
In New York, which has been most impacted by COVID, We reduced staffing to blow 50% to maximize social distancing, redistributing work to other facilities. These measures have been effective, and we will continue to take every action possible to protect our associates in the months ahead. As we protect our own associates, we're acutely aware of the impact this crisis is having on the communities in which we operate. We've already committed $1,000,000 in grants to support charities and schools globally in 12 or largest operating regions. These funds will focus on organizations targeting hunger relief for vulnerable populations, critical medical services and equipment, and school equipment for remote learning.
We also want to support the charitable giving of our associates as they generously support their communities. And was allocated an additional $500,000 to double match charitable donations made by associates. Turning to Slide 8. Our engaged associates and leading technology platforms have delivered exceptional operating performance. Our resilient and scalable technology processed huge spikes in both equity and fixed income trading volumes flawlessly.
Keeping our clients operating when others had challenges. Through not only the peak capacity season, but quarter end and month end statements and a volatility driven surge in other communications relating to trading. In some instances, communications needed to be shifted to a new location but working with clients and regulators, we've now successfully moved past the peak of the season. We feel very good that through this unprecedented time Broadridge differentiated itself as the right industry solution for these critical functions At the same time, public companies have rapidly shifted to move their annual meetings to a virtual format. We pioneered virtual shareholder meetings or VSMs in 2009 and steadily grew them to 3 26 meetings last year.
This year, more than 1500 clients have already contracted with us for VSMs. Virtual shareholder meeting is different than a webcast or a simple Zoom type meeting on which we've all been sitting the past few weeks. We leverage our unique capabilities to validate shareholders, moderate questions, and enable voting all in real time. Our team is mobilized across Broadridge to make that possible at dramatically larger scale than ever before. And they're making a difference in keeping corporate governance on track.
Finally, we supported our clients including stepping up to help them with work at either their own facilities or those above suppliers were unable to handle. The strongest relationships are created in difficult times and our ability to be there for our clients in this timely need will strengthen our relationships for many Our strong operating performance resulted in strong financial performance. Indeed, our third quarter results and fiscal year outlook underlying the resilience of our business model and the strength of our value proposition, even in the context of sharp declines in GDP, that are already becoming apparent. Despite headwinds from significantly lower event driven revenues and a shift in proxy timing, Broadridge reported solid 3rd quarter results with recurring revenue growth of 9% and adjusted EPS growth of 5%. Closed sales rose 20%.
Our outlook for the full year calls for continued growth. We expect to we continue to expect recurring revenue growth in the 8% to 10% range. To reflect the full impact of COVID including lower event driven revenues, we've modified our adjusted EPS full year growth guidance to 5% to 7%, which Jim will explain in detail. Importantly, We also remain on track to hit our full year guidance for closed sales of $190,000,000 to $230,000,000. Our pipeline is strong.
And the ability to achieve that Broadridge remains on track to deliver at or above the midpoint of our 3 year adjusted EPS growth objective of 14% to 18%. Even with the impact of COVID and cyclical lows for event driven activity. Our ability to achieve that objective despite those headwinds is a testament to long term demand trends driving our business. The investments we have made support our growth and the hard work of so many on our guidance and some early thoughts on FY 2021. Jim?
Like Tim, I'm deeply saddened by the toll the virus has taken on the Broadridge family. We are still grieving, but we are resilient. And it is possible not to feel intense pride in the way our associates have responded. They are truly delivering in remarkable ways to all our associates, thank you and a special thank you our production teams. Now our results.
I am pleased with our performance in the third quarter and even with ins and outs related to COVID. It was consistent with the outlook we provided in early March. Our performance and outlook highlight the resilience of our business. I will begin on Slide 10 with 6 call outs. 1st, the net impact of COVID on our recurring revenue in the third quarter was modest.
But there were more notable impacts in individual product lines. Organic recurring growth was 3% in the 3rd quarter and we expect high single digit organic growth in Q4 as we benefit from an increase in volatility and the shift of some proxy work 2nd, the week event activity trends we saw in the first half of the year have continued and are now being exacerbated by COVID. This is the lowest event activity in 6 years. 3rd, we recorded a 20% increase in sales in the 3rd quarter and notably higher sales in March. Because of our strong pipeline 4th, our strong balance sheet.
Our investment grade credit rating and $1,500,000,000 of liquidity give us ample flexibility to fund our operations, repay our maturing notes and support our dividend. There's no substitute for a healthy balance sheet nexus to capital. And ours gives us the comfort and confidence to focus on doing what is right for the business 5th, guidance, factoring a full quarter's impact of COVID, we are reiterating our guidance for recurring revenue 6th, and final call out, COVID in the year ahead. As is our practice, we will not provide formal guidance on next fiscal year until we report our fourth quarter. But I think it's important we provide some perspective on how the business may perform in the recession, including a very preliminary view on recurring revenue growth.
Let's turn to Slide 11 and our revenue growth drivers. Our recurring fee revenues rose 9% in the quarter with healthy new sales additions contributing 5 points to growth. Most implementations have long lead times and are in motion months before go live. Importantly, we did not see much of an impact on onboarding processes in March is clearly something we are keeping an eye on as the pandemic continues to unfold. We saw the biggest COVID impact in internal growth, although the net effect was neutral.
The headline proxy work from the third quarter to 4th quarter. These big revenue factors essentially neutralized each other. I will touch on these again in my review of each business. Acquisitions are performing well and contributed 6 points of growth. We'll start to annualize 2 of our larger acquisitions next declined modestly in the 4th quarter.
Looking to next quarter, we expect organic revenue growth to improve meaningfully The improvement should come from the combination of sustained strong sales to revenue performance and positive internal growth boosted by strong stock record growth and the realization Total revenues increased 2 reduction revenues. Let's dive deeper into each of our business segments, starting with ICS on Slide 12. Recurring revenues grew 2% as solid net new business and acquisition gains each contributed 3 points. Organic growth dipped negative due to COVID timing and other impacts. The biggest driver of our decline in organic growth was a timing shift in proxy.
As you may recall with the implementation of the new revenue recognition standard last year, Q3 and Q4 mix is very sense each day represents about $5,000,000, so it only takes a couple days of movement to shift meaningful revenue between quarters. This year, COVID related safety measures, including staff level reductions and social distancing, moved some of our dates out by a few days, This shift lowered our 3rd quarter revenues by $15,000,000 to $20,000,000. Importantly, stock record growth remained very healthy at 7% and with much of the quarter of quarterly volume now shipped, we expect high single digit stock record growth in the 4th quarter as well. The proxy catch up, coupled with the dramatic pickup in demand for our virtual shareholder meetings that Tim described, should lead to a notable pickup our equity proxy revenue line next quarter. Mutual fund and ETF Interim's revenues benefited from a positive mix shift.
Underlying record growth was 0 as the fund industry experienced record outflows in March. Customer communications and fulfillment revenues rose 3% as the decline in equity markets triggered a wave of portfolio rebalancing, which drove a 24% increase in the volume of prospectuses we sent out. Customer Communications revenues was also up 3%, which was nice to see. Rounding out ICS recurring revenues, continued growth in data and analytics revenue was partially offset by lower revenues from securities market value and interest rate sensitive products and our Retirement Fund trading and custody business, following the big market declines in the Fed's decision to slash rates. Looking ahead, ICS is on track for mid to high single digit organic revenue growth in the fourth quarter, given the combination of a strong proxy season, the pickup from the proxy timing shift, strong demand for virtual shareholder meetings and a modest pickup in post sale volumes is shaping up to be a strong finish to the year.
As I noted in my call outs, event driven revenues declined sharply to $39,000,000. As you'll see on Slide 13, 3rd quarter event driven revenues were at their lowest level since 2014, reflecting a continuation of the trend we have seen all year and new COVID related delays. As the crisis unfolded, we have seen a couple of notable proxy campaigns push into fiscal 'twenty one and high profile proxy fights set aside. So we are now anticipating additional declines in event driven revenues in the fourth quarter. Our significantly reduced full year forecast of $155,000,000 would take us to fiscal 13 levels and our weakest Q4 for event revenue since fiscal 12.
Let's turn to our GTO business on Slide 12, which reported very strong results for the 3rd quarter. Revenues rose 23% on 11 points organic growth. The biggest driver was exceptional trading growth, 28% in equity, the 19% in fixed income. As Tim noted, it is a testament to our technology and our associates that we handled record volumes so flawlessly. As a reminder, about 30% to 40% of the GTO business is volume sensitive to trading activity.
Though the majority of our contracts are based on trading bans. We're not every trade translates into incremental revenue. We also continue to achieve strong net new business additions and pickups from licenses the recent acquisitions performed well adding meaningful revenue. Beyond the higher trading volumes, the impact of the COVID crisis on our G business was limited. We did see 1 large license contract slip out of the quarter and ultimately close in April.
More generally, we are keeping a very close eye on our client onboarding schedules, and most plans are on schedule at this time. Looking ahead to the fourth quarter, we expect to see more strong sales to revenue growth and continued higher trading volumes, although below levels in March. In the fourth quarter, we expect GTO organic revenue growth to be in the high single digit range and total growth in the high teens. Turning to Slide 15. In this uncertain economic environment, our balance sheet is a source of strength.
At the close of the quarter, Our available liquidity was $1,500,000,000, comprised of $402,000,000 in cash balances and $1,100,000,000 remaining on our committed $1,500,000,000 revolving credit facility. Moreover, our debt maturity profile further enhances our liquidity outlook. Over 75% of the fixed portion of our debt does not mature for 6 or more years. Our only maturity less than 6 years is $400,000,000 of senior notes coming due in September of 2020, and we anticipate having ample excess cash and revolver availability to refinance this maturity. Our revolving credit facility has 1 financial covenant, a debt leverage ceiling, which we are well below.
An important factor in our capital planning is our credit rating. We remain committed to our strong investment grade credit rating while taking a balanced and disciplined approach to capital allocations. Given the environment in our recent M and A, we are focused on the near term reducing our leverage ratio from as a result is unlikely we will do any meaningful share repurchases in the fourth quarter. Underpinning our capital planning is our free cash flow, Broadridge generated free cash flow of quarter, where we typically generate most of our free cash flow. 2 other call outs: 1st, in our operating cash flow, you can see the impact of the large investment we are making to develop the UBS And Industry Wealth Management platform, which is on schedule.
2nd, we are keeping a watchful eye in collections, which have been very healthy so far in the crisis. We've invested $339,000,000 in tuck in M and A fiscal year to date, which includes our acquisition of Funds Library that closed at the end of February. Finally, we remain committed to our dividend. And earlier this week, our board approved our next dividend payable on July 2nd. I've made a lot of comments about our outlook and my discussion of our results.
So let me sum up there here with our full year guidance on Slide 16. We expect total recurring revenue growth our outlook for total recurring growth of low to mid teens. Taking into account event driven revenues of approximately 155,000,000 down from our previous $175,000,000 to $195,000,000 range and a modest decline in distribution revenues, we are guiding to total revenue growth at the low end of 3 6%. We continue to expect our full year adjusted operating income margin to be about 18%. We're expecting adjusted EPS growth of 5% to 7%, down from our prior guidance of about 8%.
The biggest driver of the decline in our EPS guidance is our outlook for event driven revenue. We've also derisked our outlook for the excess tax benefit to $12,000,000 from $20,000,000. Notably, the reduction in event and ETB combined referred represents approximately $0.20 or 4 points of EPS growth. Finally, a comment on sales, Our guidance for closed sales in the range of $190,000,000 to $230,000,000 remains unchanged. While our sales pipeline is strong, the challenges All in all, I would consider this a pretty strong performance.
If we close out the year with adjusted EPS growth of 5% to 7% in the face of a $90,000,000 downdraft and event fees and in range sales in this environment. And this outcome would mean achieving a 16% or better 3 year adjusted EPS k compared to our target of 14% to 18%. We all know the economic outlook is uncertain, and many of you have asked about the outlook for Broadridge beyond our fiscal fourth quarter. Was so much unknown, I for one am relieved that I don't owe you a 12 month outlook until August. That said, we do want to share with you of our preliminary thinking about how Broadridge may perform at least from a revenue perspective in a recession.
Let's move to Slide 17. Our first point of reference is to go back and look at the last downturn in 2008. We're a stronger company today, but it's worth noting how Broadridge performed in the global financial crisis which began to gather force in the beginning of fiscal 'nine. While the impact varied by business in total, Broadridge is able to sustain recurring revenue growth of 5% in the 1st year of the crisis, in the 2nd year that distinctly financial services focused crisis Broadridge posted modest positive growth despite big client consolidations and lower trading volumes. By 2011, Broadridge had returned to mid single digit organic growth.
These crises are very different, and we are better positioned today than we were in 2008 with no clearing business, more diverse revenue streams and a much stronger GTO business. I'll turn to my final slide 18. There's no easy way to dimension the exact size and shape of the COVID recession, but our initial planning approach has been to assume that we are in a prolonged recession with tough macroeconomic conditions extending through our fiscal 2021. We feel there's a prudent way to prepare for the year ahead, while keeping our eye on the large opportunities ahead of us. And assessing our business in a recession scenario is important to 1st ground in those aspects of our business that we believe are uniquely resilient.
First, our biggest revenue growth driver is the conversion of sales to revenue. We currently estimate our revenue backlog to be about $330,000,000, which is equivalent to 11 revenue growth without any new sales. 2nd, one of our most important drivers is position growth in our governance business And while we expect position growth to moderate in a recession, we take comfort that aggregate position growth stayed modestly positive, even at the low point of the global financial crisis. 3rd, we have a long track record of 97 plus percent client revenue retention, which should serve us well in a potentially more challenging sales environment. And 4th, the core of what we do is mutualization across the Financial Services industry, which historically performs well in tougher times.
Customer communications, an example of a historically lower growth business, is not cyclical and should perform evenly through a recession with even more opportunities. But to be sure, there are definitely headwinds that we expect to feel in this COVID recession. First, because we are beneficiaries of market volatility, we would back to face some tough comparables in trading and post sale volumes in the second half of next year. 2nd, lower assets under administration from market declines and interest rates may impact our fees in our mutual fund processing and transfer agency businesses. We are seeing this now in Q3 and Q4.
And third, our clients may not be able to engage in onboarding activities in the same way, which would have the effect of delaying onboardings. Frankly, though, we're not seeing this at this point. Clients could also contract for smaller or fewer licenses for certain on premise software. Net net, our preliminary work indicates recurring fee growth in the low single digits and a tough recession, which would again demonstrate the resilience of our business. Again, this represents a preliminary view and is based on our current outlook.
We will learn more with the passage of time and more data, and we'll be back in August with our Q4 results and latest thinking fiscal 2021. Let me wrap up here, as I know I've given you a lot to digest. In summary, after a solid third quarter, we expect to close out fiscal 2020 very healthy organic recurring revenue growth and strong sales. Our strong balance sheet and ample liquidity keep us well positioned to navigate a challenging environment. Above all, we have the technology, culture and people to grow and succeed.
Now back to Tim.
Thanks, Jim. Broadridge is well positioned to weather any economic downturn. And I've directed our team to prepare for an extended period of economic weakness. As always, we will balance the sometime competing imperatives of investing for what we believe is a very strong future and delivering bottom line growth in the near term. Like others, we'll use this time to evaluate where we're devoting resources and to concentrate our efforts on those most relevant in the new environment.
I'm confident we'll find the right balance and I look forward to updating you on our next earnings call. I'm convinced that a long term focus has never been more important. As we emerge from the crisis, the world will be a different place. As I talk to client, it is clear that the fallout will cause permanent shifts in the way they operate to strengthen the long term drivers of our growth. We must ensure the existing trends driving our growth around mutualization, digitization, and data will only strengthen in this new normal.
A big driver of mutualization has been the need by our clients to reduce the cost and complexity of their operations. Now as Financial Services Firms comes to grips with slower growth and near 0 interest rates. Their need to transform their business with next generation technology will only increase. A wealth management industry that was already in transition will only face more pressure to evolve. The need for digitized communications will grow.
The challenges facing the investment management industry have accelerated. And as I noted at the outset of my remarks, the importance of strong corporate governance will only increase as investors ensure that boards supply hard earned lessons about business and financial risk But the impact of COVID and client operations. Every business leader has been forced to think more deeply about the resilience of their technology and operations, creating an even greater impetus to adopt the right industry solutions with proven scalability and resilience. Simply put, the cost and risk of going it alone has never been greater. The impact of work from home is accelerating digital literacy and the demand for digitized communications.
Whether signing up for digital content, or using remote learning tools, more people are relying more than ever on digital communications in every facet of their lives. This is only going to increase the pressure on financial services firms to raise the bar on delivering enhanced digital communications whether it be a bill, statement or regulatory disclosure. All these trends play to Broadridge's strengths and will fuel our growth Business fundamentals are we have a highly resilient business model, with recurring revenues under long term contract built on providing mission critical services, for leading institutions. We have a strong investment grade balance sheet, high liquidity and a long history of balanced capital allocation, including a dividend that has increased every year since Broadridge became a public company. And finally, we have a track record of delivering growth backed by 97% client revenue retention, a $330,000,000 sales backlog and favorable long term trends that have been reinforced by the crisis.
So while the near term remains understandably uncertain, we are well positioned and the longer term opportunity for Broadridge, has never been stronger I want to speak directly to our associates around the globe listening to this call. To all of you working from home, in our production facilities. Thank you. You've risen to the challenge under more difficult conditions than any of us could have imagined a few months ago. Thanks to you, our financial system has begun to adapt to the biggest economic shock of our lifetime, keeping vital services open to millions around the globe.
I'm truly proud to and we're now open for
questions.
First
question, comes from David Togut of Evercore ISI.
And Jim. Hope you are both well and healthy. My question really relates to the early thought process you laid out, Jim, on fiscal 2021. Really with 3 specific points of clarification. 1st, on position growth, are you assuming position growth falls from high single to low single digit in fiscal 2021.
The second is on event driven revenue. Are you assuming a further decline in event driven for 2021, if so, how much? And then third, how are you thinking about managing expenses to the extent the revenue pick for 2021 is challenged as you've laid out?
Yes, in the position growth scenarios and look, again, very preliminary and we'll come back in August with all of our details. But in the scenarios we laid out, yes, we're seeing we would as we saw in the crisis. So that's embedded in some of our thinking for those scenarios. On Event, obviously, it's not in that recurring revenue. We haven't called it out, probably just too early, but obviously, we are staring at remarkable lows of $155,000,000, which states takes us back 7, 8 years.
And we are, so I think all in all, that's a good base to start off of, just given no one can call bottom, but clearly a good base to build off of, but we'll come back in August with our thoughts on event recognizing that's always the toughest line item to get. And then on yes.
Yes. That always Jim, do you want to continue on the expense side? You want me to grab that? Okay. We're not in the same room.
So we're doing this over a WebEx, so you can imagine the hand waving that's going on. So The important thing as we go into next year is that we position ourselves for the future. And we think, as I said earlier, that there are real opportunities that are going to be coming out of this. And so we will definitely be investing in 2021. At the same time, given our scenarios around revenue growth, we need to match our expense growth as well.
And so we'll be looking very carefully at all of our expenses. And as you heard me say, we'll be looking at all the areas of investment we have to make sure that we're really focused on the ones that have the biggest impact in this in this new environment.
Understood. Stay safe.
Thank you.
The next question comes from Chris Donat of Huffer Sandler. Please go ahead.
Hi, good morning. It's good to hear your voices. I wanted to ask kind of a follow-up on the event driven just to think about, the I don't know if cycles is always the right word to talk about it, but has anything fundamentally changed on event driven either from the corporate proxy side or for mutual funds that would you think might alter things. And I know there's other puts and takes around, contested, proxies and things like that, but just the big picture mutual fund activity?
Yes, absolutely. It is look, because as you know, event driven revenues are core to our business. They can be quite volatile. Their attractive, high margin business and they grow over time in line with stock record growth. And, what we're seeing right now is cyclical we are not seeing any changes to the underlying structure.
For different reasons, both mutual fund proxy and equity contests art cyclical lows. Typically, in these periods of high stress, fund companies do what they can to put off these events. So we wouldn't expect to see them anything come back really on the mutual fund side in a significant way. On the equity contest side, we've clearly seen a pullback in activism during the this part of the crisis, what lots of people are saying is that that will be back in the future. So we'll have to see how that goes.
I think the good news is that we're delivering 5% to 7% adjusted EPS growth in the face of this $90,000,000 pullback in the event this year. And we won't face that grow over next year. So I think with those points, we, we feel feel good about the contribution event we'll make in the future.
Okay. That's helpful. And then As we think about like Kim, you alluded to some of the conversations you're starting to have potential new business opportunities. Can you give us any more color on that one or is it just too soon to know where you might have new business opportunities with existing clients or are you getting some inbound phone calls from potential new clients I got to believe that there are a lot of banks and brokerage firms in the world that figured out that their technology was not everything it should be in March April?
Yes. I think as you said, these are long term conversations, it is definitely true that many firms experienced challenges. I think that the trend toward mutualization will accelerate as in house platforms make even less sense and, and firm's ability to invest in those things versus other priorities that are more customer facing will be even lower. So we do see significant long term opportunity. Those discussions typically do take a while.
And then in terms of the other opportunities we're seeing, we certainly expect that what we're seeing with virtual shareholder meetings, there will be there'll be some, obviously, there are states that, that did give a temporary, temporary pre, so those will go the other way. But I think people are going to see the success of this season and how well those are going. We're getting very good feedback on them, and that will continue that trend. And obviously, as I as I said in my remarks, we believe that the trend towards digital communications continues to represent a real opportunity.
The next question comes from Darren Peller of Wolfe Research. Please go ahead.
Thanks guys. Glad to hear you're doing okay. Look, I mean, I think it's really something and it's impressive to see the March close sales growth rate still strong per your comments.
I guess I'd really just be curious to hear where
you're at business in this kind of environment? Like what kind of calls are you getting inbound for what specific businesses? I mean, the resilience of your business is fairly shown through versus a lot of other companies that are covered in the market overall. But what can you actually add? What's the highest demand right now if we just start there?
Yes. First of all, if we just talk about March, it was interesting because we didn't have any sales that were above $1,500,000 in March. We had lot of different solutions. And as you know, we have a pretty wide wide solution set there. And so it was gratifying to see usage and ice increase across a broad array of products.
And as we look forward, we think about the sales that will happen in the next 6 months or so, those are, based on conversations that are already taking place and there's a nice balance of conversations across both the communication side of the business and the technology side of the business with some we think pretty exciting solutions that we are in discussions with clients. As we look at the period beyond that, then we're getting into, things that will take longer. But, you know, it's interesting. One of the things we monitor very closely is our pipeline. Pipeline formation of new opportunities.
And that is holding it very nicely. So what we're seeing is not just at least in March, not just the continuation of the sales, but also the continuation of the pipeline building.
Okay. In terms of your capability to implement deals in the more remote working environment, obviously, hopefully this doesn't last forever, you just comment on your capabilities in that to actually execute on contracts and new business? And then maybe just a quick touching of the BRCC area growth in the quarter, was there anything, anything to update on the post sale prospectus dynamic or, Just any more color you can give on that, that growth profile having looks like an inflected. Thanks guys.
Yes. Okay. So just, both good topic. So on implementations, this is certainly something that we are watching very carefully. We have been really impressed with how smoothly the transition to work from home has gone and it's going reasonably well for our clients as well.
And so we are seeing we're not seeing a drop off in productivity. Relative to our onboarding projects. Scenarios for that, but we are not seeing any change or pushback in our major projects to date. On the the RCC side, the we did and there's a couple of pieces there, Darren. There's a in that communication infillment line, there's the post sale piece and there's BRCC proper, which is the, which is the transactional print piece.
The post sale dynamics, very, very high volumes, this quarter relative to all of the trading activity. And that more than made effort. If you recall, we were planning a, a bit of a downtick there based on some, changes in how people are handling managed accounts, but that was more than made up for by the volatility. And then on the BRCC side, as I mentioned, the last call the off boarding of a major compliant is complete. And so we did see modest growth in Q3 from higher transaction volumes as the second 2nd quarter of stabilization and slight growth.
For the year, we're expecting BRCC to contribute to earnings, but not to revenue growth. And We continue to have discussions with large clients about outsourcing their in house transactional communications, and that's a part of that long term hypothesis. And we're making continued progress on digital with more than 100 fund complexes on a digital platform. And we expect further growth as they begin to take advantage of new capabilities. So we're feeling, especially in this uncertain environment as a very stable business.
And and we're feeling very solid about it.
The next question comes from Puneet Jain of JP Morgan. Please go ahead.
You all are safe. So, Tim, you have been quite, acquisitive recently. Should we expect, like, a pause there in M and A activity given everything that's going on related to COVID and markets?
Yes, Funeet. Great question. And we did make a lot of investments in fiscal 2020. And we really, we really like what we got and is making a nice impact on our business, particularly on the wealth management side. And that has left us with a little bit elevated, leverage, you know, because we like being invested in grade.
We like the 2.0 and we're going to work that down over this next quarter as we have very strong cash flow. As we look forward, we want to put ourselves a position of being very flexible going forward. And so let me just ask Jim to comment further and give us any additional color on that.
Tim got it right. I think, near term goal is to end the year, much closer to our 2 times number, which I think keeps us, in really good shape and a lot of flexibility for all of the capital allocation priorities we have. And I think it'll leave us in a really good position to be opportunistic, down the road, but we'll be making sure that we are ready and nimble and healthy.
And then how does, like, economics of virtual shareholder meetings, like, meaningful projects? Give a sense of, like, the scale, like, the magnitude of potential impact, you might get there. From hosting shareholder meetings, virtually.
Yes. Puneet, a great question. These are not major events in and of themselves, think of a ticket price of anywhere from $10,000 to $15,000, per, per meeting. And so, by themselves, they they're nice. It's not going to materially move the ICS line.
What it does do though is it really cements our relationship with, those companies with the, with the corporate secretary, the Assistant Corporate Secretary, and it leads over time to us to able to help them in other ways. And our vision, as you know, is to provide a very holistic approach to the annual meeting where we're doing a number of the services in and around the annual meeting. And so we have been doing, you know, the proxy piece But as we go out to the other services in and around that, we think we can make it much more convenient and much deeper relationships with our corporate issuer clients.
Got it. And who would, who would you compete in that business, for virtual shareholder meetings?
Well, for virtual shareholder meetings, it is that it's it's, you know, it's not just doing a, a Webex or a Webcast. It is there is real capabilities required to validate shareholders and to provide voting in real time. The the transfer agents have created a competing offer. Basically, and we provide information to them to allow them to to do that. The their offers are much more nascent than ours We've been doing it for a long time and, frankly, are a bit more funky.
So we do have a strong advantage in this. And, and it's something that we, you know, we think we can do really well for people.
Got it. Thank you.
The next question comes from Patrick O'Shaughnessy of Raymond James. Please go ahead.
Hey, good morning. Maybe to follow-up on your earlier commentary on development, any update on your UBS build out I think it sounds like the CapEx spending is still taking place as expected, but any changes in the development timeline or the go live timeline without one?
Yes, thank you for that question. It is, that really remains very much on track. We are we continue to be very excited about the overall opportunity in Wealth Management and with UBS. And as you saw, we have appointed Mike Alexander to lead our Wealth Management business. So that is a key step there.
We We are investing significantly in that engagement for UBS and for the platform to really create what we think is the the platform of the future that will be very attractive for others in the industry and that project remains on track. And it's one of those examples of it's a large project and we could have seen a change, but we're working very effectively in the in the remote environment. And then just stepping back from UBS to talk more broadly about wealth. We feel really good about that overall. Overall opportunity, we when we look at the M and A we've done over the past year, there's a fair bit of it that was in and around wealth management And that has led to a lot of good discussions across the spectrum and wealth management space.
We are having a number of discussions with large wealth managers, nothing nothing imminent, but there are real pain points that we can solve around helping people move to a more open architecture platform in the future.
Great. Appreciate that. And then just a quick clarification question. You've mentioned a couple of times the $330,000,000 sales backlog Is that the number end of March or are you referring to the number that you guys previously discussed as of the end of fiscal 2019?
We will do a final true up, at year end, but we are, our estimate right now is that it's somewhat similar, which means we've added $120 plus 1,000,000 in sales this year and we've onboarded somewhat similar amounts. So you're back to a similar place. Obviously, if we have the strong Q4 that we're planning, that we would be adding to that in the fourth quarter. And again, we'll come back and through this all up in August.
Great, appreciate it. Thank you.
This concludes our question back over to Tim Gokey for any closing remarks.
Good. I'm just going to I do want to summarize here. I just want to mention I want to just expand on one answer that, we talked about previously. It was just we got into a discussion of discussion about capital allocation. And I did just want to mention, we just paid our dividend and that is something that we continue to think important going forward.
So, you know, we remain committed to our dividend and that was something I just think it's important in the context of the call for for that to be out there. So with that, I want to thank you for joining today. These are unprecedented times And because of what we do and because of how we're doing it, Broadridge is resilient and performing strongly, we expect, as Jim said, a strong 4th quarter. And while there's uncertainty around 'twenty one, we are positioned well, and we see real opportunity as the world evolves to a new normal. So thank you very much for joining today.
And, we appreciate appreciate the support. Thank you.
The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.