Good morning, and welcome to the Broadridge Fourth Quarter And Fiscal Year 2019 Earnings Conference Call. All participants will be After today's presentation, there will be an opportunity Please note, today's event is being recorded. I would now like to turn the conference over to Eddie Stebo, Head of Investor Relations. Please go ahead, sir.
Thank you, Rocco. Good morning, everyone, and welcome to Broadridge's 4th quarter fiscal year 2019 earnings conference call. Our earnings release and the slides of the company this release may be found on the Investor Relations section of Broadridge.com. Joining me on the call this morning are Tim Gokey, our CEO and President 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 Broadridge that involve risks. A summary of these risks can be found on the second page of the slides in a more complete description on our annual report on Form 10 K. Also be referring to several non GAAP measures, which we believe provide investors with a more complete understanding of Broadridge's underlying operating results. 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
Broadridge delivered strong 4th quarter and fiscal year 2019 results. Our outlook for fiscal year 2020 calls for yet another strong year. Including high single digit growth in recurring revenue and 8% to 12% adjusted EPS growth. This morning, I will provide a brief review of our 2019 results, including the strong close to another record sales year. And then talk about the acquisition of RPM Technologies which was announced after our last earnings call.
Finally, I'll give you an update on our progress against the priorities I laid out in my first earnings call as CEO earlier this year. Jim will then provide a closer look at our financial results and give you more details regarding our 2020 guidance. Will close with your questions. Let's get started. I'm really pleased with both our strong fiscal year 2019 results and with how well we are positioned to deliver sustained growth in fiscal 2020.
FY2019 recurring fee revenues rose 6% to $2,800,000,000, more than offsetting a decline in low to no margin distribution revenue and lower event driven revenues. In all total revenues rose 1 percent to $4,400,000,000. Adjusted operating income rose 8% thanks to strong margin expansion and adjusted EPS rose 11%. After a strong 4th quarter and the Landmark UBS Wealth Management deal. Full year closed sales rose 9% to $233,000,000, marking another record sales year.
Just as importantly, we hit those marks while continuing to fund investments in new products and technologies. We also made 3 tuck in acquisitions that will strengthen and grow our business, especially in Wealth Management 6% recurring fee growth, double digit earnings growth, record sales, continued investment. That's why we feel so strongly about 2019. Based on these results, we're announcing an 11% increase in our annual dividend to $2.16. Broadridge has now increased this dividend
every
8th consecutive double digit increase. Looking ahead, we expect higher growth in 2020. Specifically, we expect recurring growth revenue growth, recurring revenue growth of 8% to 10%, including 5% to 7% organic revenue growth. And factoring in lower event and flight distribution revenues, 3% to 6% total revenue growth. We further expect continued margin expansion with adjusted operating income margin to be approximately 18%.
Which will drive adjusted EPS growth of 8% another year of strong closed sales in the range of $190,000,000 to $230,000,000. Based on our 2019 results, together with our outlook for continued 3 year targets we shared at our last Investor Day, including recurring revenue growth, margin expansion, and adjusted EPS growth. I'm particularly pleased to note that the midpoint of our adjusted EPS guidance range implies an 18% 3 year CAGR. Right at the high end Keep in mind that when I discuss our ICS and GTO results, I'll be referring to growth rates that better represent the underlying business trends. By excluding the impact of the ASC 606 accounting change.
Where we ended a record year on a strong note. $72,000,000 of closed sales represents our 3rd strongest quarterly result. Trailing only last year's Q4 in the second quarter of this year and propelling us for full year record of 233,000,000. I'm especially pleased with the breadth of our sales results, with 2 thirds coming from ticket sizes of less than $2,000,000. While large deals are as critical, the most important driver of our sales in recent years has been these core deals, literally hundreds of them every year.
Our success in making these kinds bread and butter sales, most of them upsells to existing clients is a direct result of the breadth of our product offering and the quality of our client relationships. I'm also pleased to note that our fourth quarter acquisitions contributed to these results with RPM launching a nice strategic sale of Wealth Management Software for a major Canadian bank. Our ICS segment continued to perform well in the 4th quarter with 6% recurring revenue growth on an underlying basis. Excluding customer communications, ICS recurring revenues rose 8% in the 4th quarter, driven in part by solid stock and interim record growth of 6% 5% respectively. For the full year, stock record growth was also 6%.
And interim record growth was 9%. In each case, slightly stronger than the average growth of the past 10 years. The long term trend for its greater portfolio diversification coupled with the growing number of managed accounts and more recently a model driven investment shows no sign of easing. Our ICS business also benefited from continued momentum from our data and analytics products and strong growth in our corporate issuer business, where we are seeing strong demand for our Disclosure Solutions Service Cutsuring Communications and Fulfillment revenues declined 1% in the 4th quarter and 3% for the year. While the growth trajectory of our customer communications business has been disappointing in recent quarters, we expect revenue declines to narrow as we complete the off boarding of a large customer over the balance of the calendar 2019 and as recent sales wins are brought online.
Our GTO segment performed well in the 4th quarter. GTO revenues rose 8%, driven by a rebound in organic growth to 5%. We expect this organic reacceleration to continue in FY 'twenty as GTR returns to stronger growth, especially in the second half. Much of this growth will come from new client on boarding where our strong revenue backlog gives us good line of sight on FY 'twenty growth. GTO revenue growth also benefited from the acquisitions of Rockhall, which closed in May, and RPM, which closed in early June.
Speaking of M And A, I'm pleased we could be as active as we were in the 4th quarter. We acquired 3 business for approximately $400,000,000. The largest of these with RPM, which we acquired for CAD400 1,000,000 for about USD 300,000,000. The acquisition of RPM Broadens and deepens our business in Canada by extending our product offering for Canadian Wealth Market. Much of the market in Canada is served through the bank channel.
And RPM extends and deepens our already strong relationship with several leading Canadian banks. And brings newer relationships as well. RPM has been growing at low double digits. And with the acquisition off to a promising start, we expect continued strong growth going forward. The acquisition of RPM, together with Rockhall and TD acquisitions, are great examples of how targeted tuck in acquisitions broadened our product lineup, deepening our relationship with the key clients, and drive we are well positioned to pursue additional tuck in opportunities that will strengthen our governance, capital markets and wealth management strategies.
We will also say discipline in ensuring that any transactions meet our financial and strategic hurdles. With that overview complete, let's turn to slide 6 for an update on the progress Broadridge has made against the priorities I discussed on my first earnings call as CEO. At that time, I identified 3 key priorities, all of which are lined tightly with our Investor Day strategy, to continue to transform Broadridge and to build world class franchises and governance Capital Markets And Wealth Management. The first priority I outlined in February is to deliver on our near term financial objectives both our FY 2019 guidance and the FY 2020 expectations embedded in our Investor Day targets. The second is executing against our multi year growth objectives across our governance and capital markets franchises and in building our wealth franchise.
My final priority is to continue to strengthen the long term foundations of our growth by continuing to build on our strong culture and world class capabilities and product. Next generation technology. Across all three priorities, I said we will maintain a keen focus on strong and balanced capital management. So let's take each one in order. The first one is straightforward.
With 2019 in the books, we delivered 6% recurring revenue growth, 110 basis points of margin expansion and 11% adjusted EPS growth. All in line or above our guidance. We also achieved another year of record close sales. Giving us further visibility into future growth. As I noted earlier, our FY 2020 guidance puts us on track to meet EPS growth range.
Balanced capital stewardship is a key part of our financial and growth strategy. Our first use of cash remains our dividend. And the 11% increase we announced this morning further reinforces the importance of a strong and growing dividend. In 2019, we continue to balance investments in our products and technology with returning additional capital to shareholders, investing approximately $400,000,000 in M and A $367,000,000 to repurchase shares, ending the year, on track with our leverage targets. You should expect us to continue to take a balanced and long term approach to our capital stewardship The second priority I discussed was multiyear growth execution.
In governance, our strategy is simple and clear. We're building the next generation of great turkey medications and extending the complimentary web services to all parts of the network we serve. Over the past year, Broadridge has rolled out innovative new digital capabilities, including a new voting app that can be accessed standalone or through an API. We are working with more than 130 mutual funds to put them in position to take its full advantage of the new 30e3 notice and access regulations in 2021. Last but not least, we began work with our clients to ensure that they will be able to fulfill the requirements of the EU's shareholder rights directive when it goes into effect in late 2020.
These are all important steps forward in building the next generation of regulatory communications We're also extending our services across the government's network. Thanks to the disclosure capabilities we acquired in 2017, our recurring revenues from corporate issuers grew almost 20% in 2019 as we handle more and more of our clients' critical governance needs. And annual meeting services to regulatory filings. Our data and analytics offering, we are marrying our own proprietary data with other sources to give mutual funds, critical information and worldwide funds flows also generated double digit growth. Finally, our acquisition of TD Ameritrade's retirement plan cost and trust assets will help us continue to link our mutual fund clients and financial advisors administer independent 401 plans and fund additional platform development.
Capital markets, we continue to make progress in onboarding new clients, including to our new GPTM global platform. That strong backlog and our visibility in terms of bringing these clients up online is a key driver behind our expectations for accelerated growth at GTO business. Included in that backlog is a significant GPTM sale to a leading Asian bank, another sign that our global growth strategy continues to pay off. In addition, we signed a multimillion dollar deal in the fourth quarter with a large U. S.
Bank to extend the reach of our DPPM platform. Finally, we made good strides in developing enhanced network benefits for fixed income market participants. 2019 has been a big year for our Wealth Management business. During the second quarter, we signed a large deal with UPS to build a technology platform looking front middle and back office capabilities. 6 months later, we are making good progress against our product roadmap.
Also strengthened our wealth management capability via the acquisition of Rockhall and RPM. So I feel good about how we're executing for growth strategy across governance, Capital Markets And Wealth Management. My third focus is on securing the future by continuing to transform Broadridge, building on the world class capabilities that make us the right industry partner now for the long term. That means strengthening talent. On culture, I'm pleased to note that our revenue retention rate has remained a strong 97%.
And that Broadridge was again awarded multiple workplace awards, including being identified as a great place to work in the U. S. Canada and India and seeing a perfect store score out of recent ranking in best places to work for lgbt equality by the Human Rights Campaign. We're proud of these accomplishments. At the same time, we've increased our focus on product development, and we continue to make strides in integrating next generation technologies across artificial intelligence, blockchain, cloud and digital.
During 2019, Broadridge rolled out enhanced digital communications, accelerated our push to cloud, continued to invest in blockchain, and advanced our work on AI for a fixed income business among many other accomplishments. These achievements are not going unnoticed by our clients. Finally, the market for world class talent is fierce, so I'm especially pleased with some of the recent additions to our senior management team. Samir Pandiere joined us from BNY Mellon, where Huya Asset Servicing Division, a business larger than Broadridge by revenue. He will lead Broadridge International.
Fred DuPont joined us from JP Morgan and previously Charles Schwab to lead our global product management team. Fred has led to build some of the most innovative digital wealth products for the past few years. I'm convinced that our ability to increasingly link our individual products to 4 more powerful solutions suites with driver success. So I'm delighted to welcome both Sumeer and Fred to the company, and their choice to align their careers with Broadridge is emblematic of the opportunity we all see ahead. Speaking of additions, I'm also excited to welcome Amit Safery to our Board of Directors.
Amit is a seasoned technology leader with a experience building leading technology businesses at both Oracle and Google, and it will be a tremendous value to our board and to our management team. So Broadridge is making progress against all three of our key priorities: financial, strategic and foundational. Let me sum up. Broadridge delivered strong financial results while continuing to invest even in a lower EMEV environment. We have real growth momentum across our 2 strong franchises and in building a third.
We continue to make the investments across product technology and talent that further strengthen our position as a trusted partner. As a result, Broadridge has never been better positioned for growth. The Financial Services industries need to leverage next generation technology to reduce costs and increase differentiation continues to increase. And Broadridge has the unique capabilities, deep experience and ability to invest to accomplish these goals. The combination of strong underlying demand, continued execution and continued investment puts us in position deliver another strong year in 2020 and sustained continued growth over the long term.
For my part, I'm as excited as ever about Rogers' prospects to create value for our associates, shareholders, and the millions of people all over the world who rely on our clients to help them meet their financial goals. Before I turn it over to Jim for review of the financials, I want to pause and I want to thank the more than 11,000 Broadridge Associates. Around the world who are enabling better financial lives for millions and we're making our vision of transformation a reality. Jeff?
Thanks, Tim, and good morning, everyone. I'll begin my comments with a few call outs. 1st, close sales and backlog. Another record closed sales performance pushed our recurring revenue backlog up to $330,000,000 at the end of fiscal 19 from $295,000,000 at the end of fiscal 2018. 2nd, Q4 revenue growth under ASC 606.
Once again, we are providing today's presentation, revenue growth rates on both an as reported basis and fiscal 2018 adjusted for ASC 60 6 to provide a more meaningful view of our top line performance. So on an ASC 606 adjusted basis, recurring fee revenue grew a healthy 6% in fourth quarter. Full year recurring fee growth was also 6% right in line with our guidance. Importantly while the ASC 606 change did have a big impact on our quarterly recurring revenue recognition, especially in our 3rd And Fourth quarters, it had virtually no impact on full year result comparisons. 3rd, capital deployment acquisitions.
We invested approximately $400,000,000 including deferred payments in the fourth quarter for 3 acquisitions that will strengthen our growth profile and broaden our product lineup, especially in Wealth Management. We expect these acquisitions accounting for the financing costs. Shares for a total of we exited the year just below our fiscal 2020 guidance calls for organic recurring fee growth of 5% to 7% plus 3 points of growth from M and A for a total 8% to 10% recurring revenue growth. We expect this to result in 8% to 12% adjusted EPS growth. Let's move to Slide 7.
On a reported basis, recurring revenues were down 6% and total revenues were down 8%. However, as I noted, the implementation of the ASC 606 accounting standard in fiscal 2019 shifted a significant chunk of equity proxy revenues and the fiscal 2018 results are reported under the old ASC 605 standard. Therefore, the most meaningful comparison is to fiscal 8 teens Q4 revenue results under ASC 606 as shown on this page. Using this like for like basis, recurring revenue grew a healthy 6% and total revenue grew 1%. Slide 8 provides the same view on In both cases, recurring revenues rose 6 percent in fiscal 2019 to $2,800,000,000 and total revenues rose 1 percent to 4,400,000,000 With ASC 606 now fully implemented, fiscal 2020 results starting with the first quarter were reported on
the same basis as fiscal 2019.
Let's turn to Slide 9 to dig a little deeper into our quarterly revenue growth. Keep in mind that the numbers in the slide are presented on the ASC 606 adjusted basis I just talked about. I'll start with recurring on the bottom half of the slide, because those are the revenues that are the biggest driver of our overall economics. Recurring revenues rose 6% in the or closed sales as shown here. As expected, internal growth rebounded nicely in the fourth quarter after a lull in Q3, contributing two points of growth, driven by higher stock record as the RPM acquisition did not close until early June and the TD deal closed at the end of June.
As I noted earlier, these deals will contribute more meaningfully in fiscal 2020. Total revenues grew 1 percent to $1,200,000,000 in the quarter, as The growth in recurring revenues was offset by lower event driven and distribution revenues. Event driven revenues came in at a healthy $51,000,000 but were down from a year ago. Strength in the U. S.
Dollar versus the Canadian dollar and British pound lowered revenue growth by one point. Next, I'll cover the performance of percent on an as reported basis that the accounting change shifted approximately $100,000,000 of mostly proxy revenue to the 3rd quarter. Adjusting for ASC 606, recurring revenues rose 6% in the 4th quarter. Looking at the growth drivers behind that 6% increase, steady net new business gains kept pace even with the ongoing run off of the known client loss and customer communications. Solid equity and interposition growth, an excellent issue of performance helped to drive 2 points of internal growth in the 4th quarter.
The acquisitions of FundAssist and MacKay Williams in the fourth quarter of fiscal 2018 also contributed a point to growth. Turning to DTO. GTO rebounded nicely in the 4th quarter with 8% total revenue growth and 5% organic growth, up from flat in Q3. Contributing to GTOs' return to healthy organic growth levels was 2 points of internal growth compared to a negative 3 points last quarter. That rebound was driven by a combination of modestly higher trading volumes and better licenses and other revenues performance.
Let's turn to profits on Slide 11. On a reported to reported basis, adjusted operating income declined 8% to $267,000,000 and adjusted EPS declined 8 percent to $1.72 per share. The decline in 4th quarter earnings was the result of the ASC 606 shift of proxy fee revenues and related earnings from the fourth quarter to 3rd quarter. These results were right in line with the guidance we gave on our May earnings call. And now for the full year on Slide 12.
Looking through all the noise around the timing of revenue recognition caused by ASC 606 and typical seasonality, Broadridge delivered another strong full year with adjusted operating income growth of 8% and adjusted EPS growth of 11%. Moving to capital allocation on Slide 13. Broadridge generated $544,000,000 of free cash flow in fiscal 'nineteen. Approximately $20,000,000 below our guidance range as a result of higher working capital, a slightly lower excess tax benefit or ETB, and higher client onboarding investments, which should serve to drive future growth. We invested approximately $550,000,000 back into our business.
The biggest use of cash was for acquisitions, which as Tim noted, will extend our product breadth and strengthen our Wealth Management business. In total, we invested approximately $400,000,000 to buy RPM, Rockall and the TD assets with $350,000,000 of an aggregate purchase price coming out of cash in fiscal 2019 and another $43,000,000 that will be paid in Q1 of fiscal 2020. Given our typical reinvestment in newly acquired businesses and deal financing costs, we expect modest EPS contribution in fiscal 2020 for these deals. Although we expect all 3 to generate very attractive returns over time. We also invested more than $70,000,000 in CapEx and software.
Another large area of investment client driven work we are doing to build our global GPTM post trade technology platform and our new wealth product. Linking these product development efforts to long term client contracts gives us the confidence and ability to accelerate our product development efforts. And we expect this area of investment to pick up further in fiscal 2020 as large efforts accelerate and push the investment to greater than $100,000,000. In conjunction with our revenue backlog, Given this increase in investment, we expect fiscal 2020 free cash flow to be equivalent to that of fiscal 2019. In fiscal 2019, we also balanced those investments with returning capital to shareholders.
In total, we returned $578,000,000 equivalent to about $5 a figure that will climb to greater than $240,000,000 in fiscal 2020 as a result of 11% increase in the dividend that we announced this morning. We also deployed $367,000,000 net of option proceeds to repurchase 3,200,000 shares including 2,300,000 shares in the fourth quarter. We closed fiscal 2019 with an EBITDAR debt leverage ratio of 1.9 times in line with our long term target of 2.0 times adjusted leverage. Our free cash flow and balance sheet position Broadridge well for continued balance, capital allocation and fiscal 2020 and beyond. Before I give some additional insight into our guidance, I want to touch on our current revenue backlog on Slide 14.
As a reminder, Our recurring revenue backlog represents an estimate of 1st year revenue from closed sales that has not yet been recognized. Our recurring revenue backlog grew 12 percent to approximately $330,000,000 from $295,000,000 at the end of fiscal 2018. As our record percent of fiscal 2019 recurring revenues. Further, the not yet live portion grew to $240,000,000. We believe that backlog is a good indicator of our ability to generate ongoing revenue growth.
Now let's look ahead into fiscal 2020. Our full year guidance can be found on Slide 15. First, we expect recurring fee revenue growth to be in the range of 8% to 10%, which includes organic growth of 5% to 7%. And approximately 3 points of growth coming from our 4th quarter acquisitions. The midpoint represents acceleration from fiscal 2019 driven mostly by acceleration of growth in our GTO segment.
Teens as a steady stream of new client on boarding should push up GTO's full year organic growth rate to mid to high single digit levels. RPM, a $40,000,000 to $50,000,000 revenue business, and Rockall, a $10,000,000 to $15,000,000 revenue business will contribute the balance. In ICS, we expect another year of mid single digit organic growth, driven by continued healthy mid to upper single digit position growth. And growth in our data and analytics products lines, partially offset by a flattish top line performance in customer communications. Next, we expect total revenue growth to be in the range to be roughly flat and 5% to 15% decline in event driven revenues.
And we expect FX loss to widen at a rate greater than recurring growth with the addition of more non U. S. Revenue including from our recent acquisitions. 3rd, we expect adjusted operating income margin to be approximately 18%, up from 17% in fiscal 2019. Which is more or less in line with our is being driven by higher recurring revenues and modest expense growth, offset in part by lower event driven revenues.
This means we are targeting high single digit or better growth in adjusted operating income. Moving down the income statement, the increase in leverage percent as our core tax rate, which excludes the excess tax benefit, remains unchanged at 24%. And we are projecting ETB of $20,000,000 in fiscal 2020, in line with fiscal 2019's $19,300,000 benefit. We also expect a modest benefit from lower share count as a result of our fourth quarter share repurchases. As a result, we expect adjusted EPS growth to be 8 12%.
And last, we expect closed sales to be in the range of $190,000,000 to $230,000,000. Finally, a word on Q1 fiscal 2020 and earnings seasonality. If you think about the quarterization of your estimates, please recall Consequently, we expect event fees to contract in the first quarter of fiscal 2020 by approximately 30% to 35% to a more normalized level, which will also have an impact on first quarter EPS. But event driven revenues at this level, we believe fiscal 2020 Q1 EPS likely to be consistent with In closing, we maintain our strong business momentum, exiting fiscal 2019 and are positioned well for another good year, marked by healthy, mid single digit organic recurring fee revenue growth and double digit adjusted EPS growth. We'll now go to questions.
Rocco?
Yes, sir. We will now begin the question and answer you. Today's first question comes from David Togut of Evercore ISI. Please go ahead.
Thank you. Good morning, Jim and Tim, and good to see the strong finish on closed sales. Just to dig into the 2020 closed sales target of $190,000,000 to $230,000,000 Could you drill down a little bit on what you expect to be the main drivers of that close sales target more ICS, more GTO, any thoughts by product?
Yes, Dave. It's Tim. Thank you very much for the commentary. And we are really excited about the continued momentum that we see in the business and as reflected in sales and as reflected in our pipeline. And the in 2019, we obviously had the very large wealth win.
And And so when we think about 2020, this target that we're putting out represents a nice growth above where we were in 2019 when you exclude that big wealth win. So I think that's just a sign of the confidence and momentum that we see in the business. It is is really across the board. And if I were to try to focus in on any one area, there's not some giant big deal that is baked in here. We continue to see really good momentum in our various ICS solutions that fit all around the regulatory communications business.
We continue to see really good underlying momentum in the GTO areas both in capital markets and in Wealth And Investment Management. We don't see another UBS type thing in this next calendar year. That is something that will take longer to develop, but we have a lot of other wealth solutions that have a good, a good head of steam on them. And we're having really good results in the area serving mutual funds as well with a good head of steam there around our data and lettuce products. So we're really seeing very balanced growth across all of our product lines.
We are, and this growth, we think we'll carriers to a very good result in 2020 without any specific large deal, driving that And frankly, we are planning in terms of how we believe that we can continue to grow sales in the years beyond because we see a lot of demand for, for what we're doing. And let me just take a minute on this because over the past 7 months, I've met more than 20 CEOs of our client in my as I'm introducing myself and really talking to them about what are the issues driving them and the themes that we've been talking about and I'll come back to this as we go through other questions. But are really resonating. And so we see good demand across each of the growth themes that we're pursuing.
Appreciate that. Just as a quick follow-up, Jim, what are your assumptions on share repurchase for 2020? I don't think you called out any share repurchase in your 2020 EPS guide?
No, we don't really have any explicit assumptions for 2020. As you know, most of the, like all of the shared account implications are coming from our FY19 activity. So we were happy that we were able to deploy, 300 and almost $70,000,000 against share repurchases. So no really additional contributions in fine.
Understood. Thank you very much.
And our next question today comes from Darren Peller of Wolfe Research. Please go ahead.
Hey, thanks guys. Look, we're happy to see the reacceleration in GTO in the quarter. If you could just help understand. I mean, I know you had a few large clients that you've been working towards. Are you starting to see the final, the actual revenue roll onto that now?
I think you were alluding to a couple in your prepared remarks. And then perhaps just think about the cadence for GTO as we look forward to 2020 to the fiscal 2020 year.
Sure, Darren, it's Tim. And as you know, these are These large projects are complex. And, some of them come in right at time, right on time, some of them take longer and sometimes that's due to us and sometimes that is due to them. And so the acceleration that you that we saw in in GTO in this last quarter was not the result of any major client onboarding, and that's something that is still to come. And we like the fact that we're seeing acceleration, even though some of the stuff is taking a little bit longer than we like, but it definitely will be one of the things driving us as the year goes on.
So that, that 8% to 10% that we're seeing in recurring revenue crop for
the company is take all of this into account. And, it is we feel very good about it. And Darren, this is Jim. On the cadence for GTO, obviously, as we said, we're pretty excited about mid teens growth that we're targeting for GTO. At the moment, it looks even in terms of the growth across the quarters, what you'll get is a bit of a mix between the organic and the acquisitions over the quarters, acquisitions obviously would be a bit heavier in the early quarters as we annualize.
And then organic, we would expect to start more modestly and then ramp over the year as we start working through the big backlog and get, the onboardings going.
Okay, all right. Guys, I mean, your business performed well pretty broad based. I'd be curious to hear more about the newer to do anymore. But one of the areas you've been growing in on wealth, first of all, you've done deals there. Now M and A has been more pronounced there.
You just help us understand the split, first of all, between GTO and ICS? And then more importantly, what's the what do you expect the growth profile of that overall of Wealth Management to be? And is that something worth splitting out as a separate business or almost a separate line item for modeling purposes?
Well, yes, it's, there, thanks for asking that question. And just as a reminder for for everyone listening. The opportunity here is that firms are having to really evolve their business model due to commoditization of Asset Management, all the other trends in Wealth Management. And there's no real scale technology player serving Wealth firms, they have to either build it themselves or they have to buy a plethora of point solutions and try to integrate them together. And we think that big opportunity.
And one of the things that I've been talking to the CEOs that I just mentioned, as we talk about our vision for creating something that you buy part of it works, but the more you buy, the better it is, that vision is really resonating with them. And So that's just I think the big picture. We do see this as something that is going to be an ongoing growth engine for us. It is and recognizing that regulatory communications has a lot lot to do with Wealth Management is really in part because of regulatory business that we do serve 20 of the top 20 wealth managers today. Some of this growth though is probably more on the TTO side than than the ICS side.
We do have some good products in ICS like advisor websites, data aggregation and some other offers, but it's a bit more a bit more on the TTO side. And, this is something that in the in this near future, you're going to see the impact from the M and A that we've done. And just as a reminder, RockCall is a really good securities based lending platform, previously we did advisor compensation with RPM. We're really bringing on the ability integrate the banking side with Wealth Management in Canada now and maybe more than that eventually. The all the digital communications conversations are having really resonate well with wealth managers.
So there's a lot there. But we'll see, I think initially the impact on the M and A, we'll see the impact from our existing point solutions And then probably not in 2020, but beyond 2020, we'll begin to see the impact from some of these larger transformative deals.
On the reporting side, Darren, obviously, we'll be excited to showcase our results in the area and we'll give that some thought as when the best time to break that out is. But obviously, we're, we're really excited about the progress in
And our next question today comes from Peter Heckmann of D. A. Davidson and Company. Please go ahead.
Hi guys. This is Alexis Huseby on for Pete. Thanks for taking our questions. Could you just remind us of the annual revenue contribution of the 3 recent acquisitions?
Yes. We talked about, the business in Canada RPM, which in U. S. Dollars, about $40,000,000 to $50,000,000 The Rockall business based in Ireland is about $10,000,000 to $15,000,000 and the TD assets represent a business that's approaching about $20,000,000 in fee revenues. So good contribution.
That's where we get the 3 points of growth next year from acquisitions.
Great. Thank you. And then are you aware of the timing of any proposed rule changes on mutual fund term distribution or any other regulatory changes pending that we should be monitoring?
Yes, let me grab that one. So really two areas on regulatory there is the the implementation of 30e3 and is there and what is the next generation of client experience for fund companies. And as context there over the past 10 years, we've reduced the overall cost per transaction by 40 percent saving the industry $400,000,000. So we feel really good about the impact that we've made here. And we're pleased that more than 130 funds are adopting our solution for implementing 30e3.
We think that there is a future opportunity to make those notices that be sent even more valuable by having enhanced content on them. And that's something that we continue to discuss with players in the industry. And the implementation this, which is in 2021, as we said before, is a modest positive for us. But for us, we really see it as more of an investment in the ecosystem So that's the 30e3, please. There is, ongoing, I'd say, research by the SEC in terms of how to further enhance the client experience.
And we are certainly giving input into that, which we think can help the investors closure be even a higher level. And I think both ourselves and the investment company to have talked about the idea of summary documents and making these documents much more legible and either to read for investors. And then the other big area is proxy Plumbing. And the discussions there that have followed from the roundtable last fall. And on is good momentum there really around the notion of end to end confirmation.
And that is something we wrote a letter along with the Council of Institutional Investors, Society of Corporate Secretary and SIFMA, this past winter, all supporting the idea of end to end confirmation. We are we currently calculate for about half of the and we're going to introduce end to end confirmation for the part where we can make it happen beginning next year. And there is an industry working group around how to bring that to the other half of the industry. And again, we think this is something that will just continue to increase investor's confidence in the current system and allow through NN confirmation to, to eliminate any possibility of things like omnibus proxies that don't transfer and things like that. There's some sort of edge cases that will surfaced through and confirmation that will really improve the integrity of the entire process.
And our next question today comes from Oscar Turner of SunTrust. Please go ahead.
Hey Oscar. Oscar.
So first question is on customer communications. Just wondering if you can give some color on the pipeline in that segment. And I think Tim discussed a couple recent wins, but are those anything that you think would move the needle?
Hey, Oscar, it's Tim. I think communications is, so first of all, I'm going to come back to sales. But I do want to just one thing we always talk about the revenue, but I also want take us back for a thesis and the strong synergies. And we have achieved 2 times on the synergies. So we are well, we've had planning revenues, that has not been not been affecting earnings.
I think that's just something to have out there. We right now, we're seeing lots of small and medium sales and we have a nice backlog of business to onboard. That amount of business to onboard is probably not enough to sort of significantly accelerate the growth to sort of move it to what we're talking about for next year, which is sort of roughly flat. The we have been moving through this large client that has been off porting. And it's an interesting one because The fact that it has been off boarding more slowly than expected has meaning we've been talking about this decline for a lot longer than we expected if we personally own this business, we'd be happy.
The longer it stays, the better it is. But as a public company, means we're talking about it a lot longer. So we do expect to be to be finally done with that, sort of at the end of the calendar year. And, at that time, we would expect the rate of sales we have to sort of get us to even balance. And beyond that, Ben is really looking forward to are there larger conversations that could make a bigger can't really tell with the timing of those, but they would be meaningful when they occurred.
And of course, in the longer run, yet is the whole, digital idea. And definitely in the conversations that I have with CEOs Wealth Management firms when when we talk about the future of communications is and how this all needs to be delivered through mobile experience with abilities to drill down and to take action that is a vision that people really see as what the future is. And so our thought is really about how do we focus all of this in terms of helping our clients transition to that future timing, which is indeterminate but important.
Okay. Thanks for that color. And then second question just on M and A, seeing a pickup in the deal pace recently. With the tuck ins that you mentioned. Just wondering how we should think about your appetite for a larger transformational deal in any of those spaces you mentioned.
So I think you talked about governance, capital markets and Wealth Management.
Absolutely. So first of all, just tugging M and A in fintech is an evergreen strategy. It is there's there are always new solutions, there are always management teams getting things for a certain size, wanting to take it to the next level and wanting to partner with someone like us we have a strong track record of doing that really for growth and making it growth accretive. And it's something that's just we view as an ongoing piece of our business And we were fairly active in the last quarter. I'd say our approach hasn't changed.
We continue to have the same criteria that we always have in terms of good returns that we're the very best owner. And we do have a very we've been active in the 4th quarter and we have a a very active pipeline right now because there are a lot of properties for sale because it's a good time to be a seller, which also means be careful as a buyer and so our criteria around, are we really the best owner and do they align with our strategic theme? When we think about larger transactions, it is, there's a version of that that's an extension of what I just talked about where it's still tuck in, the bigger tuck in, and we would have definitely appetite for the right thing that met all those criteria around strategic fit and around the ability to have a good financial return over time. And then when one thinks about something that is even more transformative than that, I think it becomes pretty opportunistic in terms of are there any situations that make sense? And we it's just it's not something you can really analyze ahead of time and we just are really focused on what we can control and which is a steady pipeline of things that are very visible at looking at 100 deals a year and we think we can be very repeatable for the long term.
And our next question today comes from Chris Donak of Sandler O'Neill. Please go ahead.
Hi, good morning. Thanks for taking my questions. Just wanted to follow-up on that last one as it relates to your share repurchase activity in fiscal 2019, because Is it fair to say that when you're more active on the share repurchase side, that's like your last alternative to investing in the business
on the balanced capital allocation. And so we look over a long period of time and not necessarily formulaically, but we certainly arrive at a pretty good balance between M and A and share repurchase. In a given year, clearly, we keep an eye on what our M and A pipeline looks like. And obviously, we also look at our share price. And clearly, there's some opportunities this year to jump in and get some shares at good prices And obviously, it helps when it's towards the end of the year, we've got better visibility in the high free cash flow quarter for us, it helps us align that.
So and still finishing the year, just below our target leverage ratio. So this is going to continue to be part of our MO. And we're pleased with sort of what we accomplished, both good M and A goals, as well as sort of meaningful share repurchase in the year. As Tim said, the pipeline and M and A remains strong. Timing is always a fool's errand to figure out exactly the timing.
Okay. And then one question about your guidance for event driven revenue. And I recognize that, it's event driven. So it's hard to predict. But first, just do you have, at this point, being August 1st, pretty good visibility into your fiscal first quarter?
And then second, what are the big swing factors for the full year on the difference between down 5% or down 15%. Is it mostly on the mutual fund side or is it more contest specials? Like just what would you expect it would be more likely to move the needle?
Yes, Chris, that, and as a reminder, for others, remember, this is about 5% of our revenue but clearly, we like it when it's there. I would just highlight before getting your question. I think one of the things that we're very pleased with is, look, we had we had some good event years where we had chances to reinvest significantly at a year like this, events down and it wasn't much of a ripple, even in our guidance, we're expecting to be down again and still teeing up similar earnings growth target So obviously, we always keep an eye on it. There's not a lot to manage with it, but our goal is to sort of manage through that, whether it's up or down. So as we look at the given year, yes, we have decent visibility.
As we've always said, as we look out 98 plus days, we always feel pretty good about what we see we've got one decent sized fund in the queue for the year, as you get out into the second half of the year, much harder to determine where it's going to come from. That said, we've been at this for a while. And so we have pretty good analytics on understanding some base level of event to recognizing the forecasting challenges in this area. And so we feel pretty good on the funds, I would say, more chance for upside coming from Equity contests and specials and on the fund side. And, as you know, those are certainly hard to handicap, but we don't have any heroic assumptions in there on that.
And obviously, we get a lot of little contributions across a lot small deals and occasionally some larger deals. So we feel good. I mean, we're focused on delivering on the things we've got, plans to deliver against and good visibility on a good case level of event fees.
And our final question today comes from Patrick O'Shaughnessy of Raymond James. Please go ahead.
Good morning guys. So normally I think as we look at your deals, you guys pay maybe around 3 times revenue for the companies that you're buying. You paid around 6.5 times for RPM. What were the characteristics that you saw at RPM that justified that price in your view?
Yes. Patrick, it is, it's Tim. And, RPM has a really strong growth trajectory. And is a really good strategic fit and it is has good profitability. So when we look at We model all this out obviously like everyone does in terms of what do we expect is going to happen over time in terms of its future revenues, how those are going to translate into contribution for us and what's the return we're going to get.
And so the revenue multiple can definitely vary on those. But this is one that is, is something that is, you know, we think it's going to be a really nice, really nice fit for us, really help us grow our Wealth Management business in Canada, but also us some optionality over time as a really technology architecture that can do some other things for us too.
Thank you. This concludes our question and answer session. I'd like to turn the conference back over to the management team for any final remarks.
Great. I just wanted to thank everyone for participating in the call. And just want to reiterate that really the significant opportunity that we see ahead and how well positioned we think Broadridge is to really help make a difference for the industry. And and just look forward to talking to you next quarter when we have more progress to report. Thank you.
And thank you, sir. Today's conference has now concluded and we thank you all for attending today's presentation. You may now disconnect your lines and have a wonderful