Welcome to Broadridge's Mid-Year 2025 Investor Update. I'm Edings Thibault, Broadridge's Senior Vice President of Investor Relations. I appreciate you joining us this evening, and I look forward to another great discussion. As we get started, I encourage you to download the accompanying slides within your portal, as I'll be referring to them tonight throughout my discussion. I'll kick us off with a few required callouts. First, I'll be making forward-looking statements on today's call about Broadridge that involve risks. A summary of the risks that may impact our business can be found on our Form 10-K Annual Report on our website. Second, I'll be referring to several financial metrics which are different from those found in our reported or GAAP financial statements. We believe these non-GAAP measures provide our investors with a more complete understanding of Broadridge's underlying operating results.
You can find an explanation of these measures and reconciliations to their comparable GAAP measures in the appendix to the presentation. In addition, please note that all mentions of recurring revenue growth this evening are in constant currency terms. Last, all statements related to our Fiscal Year 2025 financial guidance and long-term financial objectives are as of January 31st, 2025, so last week, and they're not updated. Now, we have a full agenda today, so let's turn to Slide 3 to get started. I'm going to begin our review tonight, as I always do, with a quick overview of our business. After that, I'll provide a summary of our mid-year results for Fiscal Year 2025 and our latest outlook for the full year. Then we'll take your questions. Let's begin on Slide 4.
Today, Broadridge generates over $6 billion in total recurring revenue, total revenue, pardon me, two-thirds of which is recurring. That recurring revenue has grown at a 10% annualized growth rate, or CAGR, over the last 10 years, driving a 13% Adjusted EPS CAGR over the same period. That has resulted in an annualized total shareholder return, so the combination of share price appreciation and dividend, of 19% over the past decade, compared to 13% for the S&P 500. Our ability to deliver consistent results over a decade should give you confidence about the long-term objectives we've set for the Fiscal Year 2024 to 2026 time period. Now, at the core of Broadridge's business is our unique network and business model. Broadridge operates at the intersection of financial services.
We serve nearly every broker-dealer in North America, which gives us a service relationship with almost every public company, asset manager, fund, and investor, and our governance platform reconciles investor positions, tracks client preferences, sends and receives digital and physical communications, and provides consolidated industry-wide billing, and these touchpoints give us a large and unique data set on investor positions in North America, which creates additional opportunity to extend new services to our clients, and so within that network, we've carved out three franchise businesses in governance, capital markets, and in wealth and investment management that are providing mission-critical services for our clients at scale. Our franchises process more than $7 billion regulatory and client communications each year. We enable the clearing and settlement of over $10 trillion of trades each day, and over $15 trillion in assets are custody using our SaaS technology platforms.
And we have become a trusted partner to our clients by focusing on the critical services behind the scenes to ensure a compliant, resilient, efficient, and frictionless experience. And that's why we're excited about the long-term opportunity ahead. So for more on that, let's turn to Slide 6. Broadridge serves a $60 billion vendor-addressable market. Within each franchise, there's a long runway for growth given the recurring revenue we are currently generating relative to the size of each of those markets. And there are some powerful trends supporting these markets, including the democratization of investing, the digitization of communications, the acceleration of trading, the power and presence of data and artificial intelligence, and a regulatory landscape where the only constant is change. We believe the combination of these large markets and their underlying trends create an attractive growth opportunity for Broadridge.
So let's briefly touch on our strategy for pursuing that growth on Slide 7. Broadridge has a clear plan for long-term growth. In governance, we're driving democratization of investing through innovation in tailored shareholder reports, pass-through voting, and enhanced digital delivery, making regulatory communications more engaging for investors at a lower cost for brokers and issuers. In capital markets, we're simplifying and innovating our clients' global trading operations. And in wealth, our clients are struggling with fragmented legacy technology, and we're helping them meet that challenge with the most modern technology in the marketplace. Now, to see how we're turning that strategy into financial results and growth, let's turn to our summary of our mid-year results on the next slide. So first, Broadridge delivered strong first-half financial results. Second, we are executing on the growth strategy I just summarized.
Third, during our earnings call last month, actually last week, we reaffirmed our Fiscal Year 2025 guidance, including 6%-8% recurring revenue growth, 8%-12% Adjusted EPS growth, and strong sales. Finally, we're on track to deliver on our three-year financial objectives. Let's turn to a summary of our financial results on Slide 9. As I just noted, we delivered strong financial results for the first half of the year. Recurring revenues rose 6% constant currency to $1.9 billion. Adjusted operating income margin increased 170 basis points to 14.9%. Adjusted EPS grew 27% to $2.56. Finally, we delivered closed sales of $103 million, compared to $106 million during the prior year period. Let's review the performance of each of our franchises, starting on Slide 10.
I'll start with our governance business, where we are driving democratization and digitization by delivering innovation, by helping our clients adapt to change. ICS, or governance recurring revenues, rose 7% for the first half. Investor participation continues to be an important growth driver for our governance business. Equity position growth, which measures the number of individual shareholder positions, strengthened to 8% in the first half. We saw that growth begin to pick up in November, and we now expect low double-digit growth for the full year. The number of mutual fund and ETF shareholder positions also grew at 8%, but we expect that to slow in the second half. Beyond positions, our growth is predicated on delivering innovative solutions to our clients. Our new tailored shareholder reporting solution is enabling funds to communicate more effectively with their clients. Our Wealth InFocus solution is powering digital communications growth.
And as we prepare for the upcoming proxy season, more than 400 funds will be using our pass-through voting solutions to give their shareholders a greater voice on governance and other issues. I'd be remiss if I didn't call out our work in the first half of the year in facilitating board elections at a leading global mutual fund complex. Broadridge seamlessly processed more than 100 million beneficial positions in over 400 funds held at more than 1,000 brokers. Board of Directors elections like these highlight the critical role that Broadridge plays behind the scenes, ensuring that funds can communicate with their investors and get the approvals they need on key governance matters. Let's turn to our capital markets business on Slide 11. Capital markets reported 6% first-half recurring revenue growth, and we are simplifying and innovating trading across the front and back office.
In the front office, we continue to roll out new solutions to speed trading and reduce the costs of trade execution with a new AI-enabled trading solution for algorithmic trading strategies and with a new trading capability that simplifies and improves trading for structured products. In the back office, our post-trade platforms continue to support strong volumes across both equity and fixed income markets. We rolled out new Gen AI enhancements for our OpsGPT post-trade platform, and our cutting-edge Distributed Ledger Repo product is enabling a growing number of banks to more easily adapt to the new treasury clearing requirements. Turning now to our wealth franchise, where we are modernizing wealth management. Wealth and investment management recurring revenue grew 4% in the first half. During the second quarter, we closed a $185 million acquisition of Kyndryl's SIS business to further expand our wealth business in Canada.
Now, stepping back over the years, we built a strong Canadian technology business serving many of the largest banks, broker-dealers, and wealth managers in Canada, so the acquisition of SIS gives us more opportunity to drive productivity for advisors, enhance investor experience, and streamline operations for our clients using our common integration layer, financial services APIs, and our component-based approach. Outside of Canada, our Broadridge wealth management platform continues to be recognized for its leading-edge capabilities, with recent awards from both Chartis and the Everest Group, and that recognition is helping drive a record pipeline for our wealth business. What are we doing with the capital we're generating? Broadridge has a long history of balanced capital allocation.
Our priorities are to invest internally, maintain an investment-grade credit rating, continue to pay a growing dividend in line with our earnings growth, and pursue strategic Tuck-in M&A and return excess capital to shareholders in the form of share buybacks. In the first half of the year, we returned $196 million in capital to our shareholders through the dividend. And I'll remind you, that's the 12th year out of the past 13 years where Broadridge has delivered double-digit dividend growth. As you can see on the slide, we're able to do this while still making internal investments in our business and investing in Tuck-in M&A. And importantly, at our call last week, we maintained our expectation for full-year cash conversion of between 95%- 105%, which means we are positioned to pursue additional M&A and/or repurchase shares in the second half of Fiscal 2025.
Now, let's wrap up with our guidance on Slide 14. During last week's earnings call, we reaffirmed our Fiscal Year 2025 guidance, including 6%-8% recurring revenue growth constant currency, 8%-12% adjusted earnings per share growth, and closed sales of $290 million-$330 million. In other words, Broadridge is on track to deliver another strong year. So let me wrap on Slide 15 with three simple messages. One, Broadridge delivered strong results during the first half of 2025. Two, those results keep us on track to deliver on both our Fiscal Year 2025 guidance and our three-year financial objectives.
Third, Broadridge's unique network, our investments in long-term growth, and our track record of stellar client service positions us to remain the trusted and transformative partner of choice for our clients as they make the transition from fragmented legacy systems to a cohesive set of platform-based strategies. That is a great place for our company to be. Now, that concludes my prepared remarks. Let me explain how our Q&A session will work. All shareholders who are given a shareholder registration number as part of their invitation, which means you are shareholders of record as of January 16, 2025. Those shareholders may submit questions electronically through our portal, and their submissions will come to me with their name and shareholder registration number, and I will answer as many questions as time allows.
If you're not a shareholder or became a shareholder after January 16, then you are on this call in listen-only mode, and you can always contact our investor relations team with questions after the event. Please allow for a moment to load up the question queue. Great, so I see the questions coming in. We'll give it another second here. Terrific, so our first question is, how on February 6th are you reporting first-half 2025 results? I'd love to tell you our business is that predictable, but in all seriousness, Broadridge's fiscal year runs from July 1st through June 30th, and so when we think about our fiscal year performance, we're in the midst of our fiscal year 2025, which will conclude on June 30th, 2025, so we just wrapped up the first six months of our fiscal year and are reporting our first-half results to you.
So thank you for that question. All right. Our next question, your year-to-date performance is strong. Can you talk about your outlook for the second half versus the first half? Absolutely. We are very pleased with our results halfway through the year. The biggest driver of our revenue growth as we think about the full year, and particularly our recurring revenue growth, is really revenue from new sales, in which we are onboarding contracts from businesses already sold to clients. So it's really about the pace of our ability to onboard our sales, and that's tracking essentially in line with our expectations. And we're thinking as here today, we're telling you our full-year outlook is right in line with the 6%-8% recurring revenue growth outlook that we set at the beginning of the year and the 8%-12% earnings growth guidance that we gave as well.
The first half of the year showed strong results, but we're also tracking essentially in line with where we thought we'd be. On the positives, we're clearly seeing the benefit of strong equity position growth. The market momentum since November has really led to our outlook for that particular metric improving from mid- to high single digits to low double digits. That's going to be a driver of our recurring revenue growth in the second half of the year. We clearly benefited in the first half of the year from stronger event-driven revenue. That's that mutual fund proxy contest I talked about. Those are the types of activities that don't recur every year. In the case of this particular Fiscal 2025, we saw record first-half results. We think they'll actually moderate.
So when we think about the second half of the year, we see the other part of our fund position growth continuing to stay in the mid-single digits. We see the dollar strengthening. That's going to clip our results a little bit. We clearly have the full second-half benefit of our acquisition of SIS, which is going to drive recurring revenue growth. And we expect our event-driven revenues, as I said earlier, we expect those to be lower in the second half of the year than they were in the second half of last year, largely because we expect them to normalize and because we're anniversarying the Disney proxy contest that benefited our results in Fiscal Year 2024.
So bottom line, we expect strong recurring revenue growth in the second half of the year, a little bit more tempered earnings growth, largely as a result of lower event-driven revenue and the timing of the investments we're making in our long-term growth. So thanks for that question. Next question. Right along, the stock market has gotten stronger over the past few months. How much of an impact does that have on Broadridge? That's a really great question because we really are selling to in and around the financial services ecosystem. We talked about operating at the intersection of banks, broker-dealers, asset managers, wealth managers, and retail investors, so really keep a position in the overall ecosystem of financial services. That being said, Broadridge has very little direct impact from stock prices or the value of assets per se.
But what we are seeing clearly is an improving market backdrop over the last few months. That includes more optimism about the economy. We're hearing from our bank clients indicating that they're looking forward to a rebound in capital markets activity. And that is translating for now into higher equity position growth. So we're seeing more investors come into the market, own more positions across equities, and that's helping drive our equity position growth. We're not quite seeing that on the mutual fund side. So a little bit of a mixed message there, but clearly strong equity markets and increased confidence about the economy seemingly are driving a higher equity position growth. We've seen that really pick up beginning in November, and that's continued on through the beginning of the calendar year through January. So we're definitely our testing is showing that'll continue in the second half of the year.
That's going to have a modest benefit for us, and it's one of the reasons we feel really positive about our outlook for second-half recurring revenue growth and our overall outlook for our recurring revenue growth of 6%-8% for the full year fiscal 2025, and another one of these are great questions. You talk about investing for long-term growth. We do. Can you provide a little bit more information about the areas that you're investing in? Absolutely, and another great question because one of the keys to Broadridge is we're very focused on organic growth. That means growth outside of acquisitions. We really see acquisitions as an accelerant to our core growth strategy. We think of every client as a 99-year client, and part of that promise that we make to clients is we're always investing in what's next.
We want to make it easy for clients to sign a contract with us today and then re-sign on that same contract in three, five, seven years when it's renewed. To do that, we need to make sure that we're reinvesting in our products to keep them valuable for our clients. So it helps drive organic growth, and we've consistently invested in our own business over the last 10 years. Now, your question was really, what are some of the areas you're investing in? And they're really aligned with where we're seeing some strong sales performance. So when we think about it, we think about our digital communications, the omnichannel communications, and our Wealth InFocus solution, which really helps drive the digitization of communications. That's clearly an area of investment for us.
We're also investing in our data and analytics capabilities and our fund solutions unit to drive more insight to our fund clients. In our technology businesses, we're investing in front and back-office simplification. You heard me reference Distributed Ledger Repo and capital markets. That's an area where we're driving some significant innovation in the marketplace. And in wealth, we're investing in our key capabilities around advisor solutions, private debt, back-office modernization. And we're also investing more broadly, DORA and resiliency, which is a regulatory need to help our clients achieve greater resiliency within their operations. And then last but not least, internally, we're always looking at investing in AI and in our core technology platforms. So lots of great areas to invest. It's really the areas where we're really driving our sales as well.
It's great to see that these investments are translating very concretely into future growth for our company. All right. Our next question, capital allocation. So right in line with investments. Can you talk about capital allocation, whether you're planning to pursue more M&A in the second half of the year, share buybacks, or dividends? Well, it wouldn't be a great investor conversation if we didn't talk about dividends and share buybacks. Those are our ways of returning capital to shareholders. And clearly, for many of our investors, the fact that we paid a strong and growing dividend over time is a core part of our attractiveness as an investment opportunity. So let's step back, though, and think about what are our priorities for our capital allocation. And they've been very consistent over the last decade or more. We have a business model that has strong free cash flow conversion.
We're not a capital-intensive business, so we tend to generate strong levels of free cash flow. Our focus on that, we're always going to prioritize that internal investment, all of the areas I just spoke about. We do believe it's important for us to remain in investment-grade credit, so having a strong balance sheet is also how we approach managing our capital, and beyond that, beyond the internal investments, maintaining investment-grade capital, if we can't find investments to invest internally, we're going to look for M&A. We have a long track record of successful tuck-in M&A of all sizes that's helped drive and position ourselves for growth, and if we can't find those tuck-in deals, we're very comfortable returning capital to shareholder in the form of a share buyback, and I didn't mention that even before M&A, our strong and growing dividends.
We're going to fund internal investment, remain investment-grade, pay a strong and growing dividend, do tuck-in M&A where we can find the right opportunities. Any excess capital beyond that, we're going to return to shareholders in the form of a buyback. Now, when we think about fiscal year 2025, as we said earlier, we're going into the second half of the year. We're expecting to generate about $1 billion of free cash flow this year, give or take, based on some of the guidance we share with you. We've already committed about $600 million of that. I look at that as about $400 million as part of our dividend, another approximately $200 million for the SIS acquisition. That leaves us with potentially $400 million to go out and fund additional tuck-in M&A and/or return capital to shareholders, i.e., share buybacks.
So I think you're going to see us well positioned to be active on investing in our business or returning capital to shareholders or both. All right. Last, how is Broadridge leveraging AI? Well, it also wouldn't be a conversation if we didn't talk about artificial intelligence because that's obviously a hot topic across the market and truly potentially transformative technology in the long term. So Broadridge is committed to being an AI leader within our space. We operate - we're a trusted fintech at the center of a unique network, as I described. And we believe there's huge power in the dataset that we see and run through our system over the long term. And that could be a real differentiator for Broadridge. However, we're approaching AI really focused on four areas. One, we're enabling our current platform and products with AI capabilities.
So these are essentially putting a ChatGPT or other AI GPT function on top of our platforms. It's really about building that as an integral part of our products. We do think those types of product enhancements driven by AI are going to become table stakes or increasingly common in our business. Second, we're really launching new AI products where we see AI as being a core differentiator of that product. So truly standalone products, things like our Global Demand Model, our AI algo platform, which enables algorithmic trading strategies to happen more rapidly. So where our domain and our unique data really brings unique value proposition to our clients. Our third area of focus is really around productivity. How do we drive productivity and re-engineer our businesses across this?
So whether it's key areas and key processes where we can speed that up or even enabling our associates to tap into AI so that they can look for incremental productivity enhancements. And we see that as a really attractive opportunity over the medium term. And the last area of focus for us is, of course, safety, making sure that we're treating our data and our clients' data with the utmost care and that we're careful to keep it inside our own ecosystem. So we're going to stay an AI leader. We're going to invest in products. We're going to invest in our productivity, and we're going to do it safely. Last question here. How is Broadridge thinking about digital assets and crypto? That's a great question as well. We've gotten a lot of really good questions tonight. I'm excited about the engagement we're getting from this platform.
I think when we think about digital assets, whether it's crypto or tokenization or other things, these are really opportunities that we see over three potential horizons. In the short term, we're focused on our Distributed Ledger Repo platform where we have a really good position in fixed income, and we've been doing over $50 billion in trades a day on that platform. That's not too far off of the entire cryptocurrency market, excluding Tether. So it's really a great example of a successful distributed ledger capability and using that. And so we're moving from a current focus, which is really about how institutions handle repos within their own institution, intra-institution, where we're extending that to sponsored repo to help with industry transition to treasury clearing. You heard me reference that earlier. And then ultimately to real-time repo, which should be a real new source of daily liquidity.
Now, beyond DLR, we're looking at the market for digital assets, which is changing rapidly, and we expect very significant growth in the overall digital industry there. We see a great opportunity to help support the popularity of digital assets, things like crypto assets, with a really robust disclosure regime. We think the popularization of investments with robust disclosure has been a great formula for success in U.S. capital markets over the last century or more. It's really why American capital markets remain the real envy of the world, and I think in the longer term, there's even an opportunity around widespread tokenization of assets. We think we're well positioned there given our strength in Distributed Ledger Repo, and we'll look to extend that over time as well. Near-term, we're pushing our Distributed Ledger Repo.
I think in the medium term, as we see more popularization or with a pro-crypto administration, see more opportunities for crypto assets, we see a potential opportunity to help those assets become more available to mainstream investors with greater disclosure. And then long-term, it's the creeping tokenization across different asset classes and eventually potentially across the entire financial ecosystem. And we think we're well positioned there. So great. I think we are coming to the end of our time. So I tremendously appreciate it. I do want to wrap up here with a few callouts. One, of course, we appreciate your continued participation and engagement on these calls. You play a huge part in our efforts to democratize investing. And remember, as an investor, please feel free to contact Broadridge's investor relations team at any time with questions about our business.
Two, we believe we are a strong business with a long runway for growth. I hope that message came across to you tonight. We're excited about fiscal year 2025 for the second half. We're excited about how we're executing on our three-year targets, and we're excited about our position for long-term growth. Third point, I'll always leave you with my own personal PSA. Remember, we are entering peak proxy season at this time where the vast majority of annual meetings take place, and your voice as an investor matters. I encourage you, please be engaged in the governance of the companies and funds you're invested in. Download the ProxyVote app, vote your proxy, and respond to surveys asking for your views on how funds should vote. I urge you all, be an owner, not a renter of your investments.
Thank you again for your interest and your investment in Broadridge. Have a wonderful day.