Broadridge Financial Solutions says Oct.-Dec. profits dropped 80%

Broadridge Financial Solutions Inc. reported Friday its profit dropped 80% in the October-December period compared with a year earlier because of less demand for its investor communications services and costly acquisitions.

The company, headquartered in Lake Success, said its profit totaled $10 million in the quarter ended Dec. 31, compared with $50 million a year earlier.

Revenue for the three-month period totaled $969 million, up 2% year over year.

Broadridge delivers billions of documents to shareholders each year and processes trillions of dollars in stock trades each day. It has large processing facilities in Edgewood, where about 2,300 people work.

Executives said Friday the company's financial performance in the October-December quarter was impacted by fewer shareholder proxy fights and other corporate events compared to the same period in 2018.

“Event-driven activity declined 36%, leading to a 5% decline in adjusted earnings per share in a seasonally small quarter,” CEO Timothy C. Gokey said, adding the January through June period is “more significant” for the company.

“Broadridge remains very well-positioned for growth, and we continue to invest in new products and technology to create value,” he said.

Broadridge has purchased many small companies in the past few years to add to its portfolio of services.

The details of two recent acquisitions, each for about $70 million, were disclosed Friday.

Broadridge bought ClearStructure Financial Technology LLC in November. The Danbury, Connecticut company provides software used by debt investors, called Sentry PM, and employs 52 people.

On Jan. 21, Broadridge announced plans to buy FundsLibrary Ltd., which delivers documents and data for the asset management industry in Europe. The British company employs more than 60 people, according to a Broadridge spokeswoman.

CFRA Research, an independent financial research firm, predicted Broadridge's revenue will "pick up into the second half of fiscal year 2020."

CFRA analyst David Holt said, "We think a rebound in growth could be led by higher trading volumes, especially if stock market volatility continues and drives" investments in mutual funds and other funds, which in turn increases demand for Broadridge's  services.

Broadridge shares were down $10.31, or 8%, to $119.15 on the New York Stock Exchange on Friday.

By James T. Madore

james.madore@newsday.comJamesTMadore

James T. Madore writes about Long Island business news including the economy, development, and the relationship between government and business. He previously served as Albany bureau chief.