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FACTSET RESEARCH SYSTEMS, INC.

(FDS)
  Report
Delayed Nyse  -  04:00 2022-09-26 pm EDT
388.42 USD   -1.08%
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09/23FACTSET RESEARCH SYSTEMS INC Financial Statements and Exhibits (form 8-K/A)
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FACTSET RESEARCH SYSTEMS INC MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (form 10-Q)

07/01/2022 | 04:04pm EDT
This Management's Discussion and Analysis of Financial Condition and Results of
Operations ("MD&A") should be read in conjunction with the Consolidated
Financial Statements and related notes included in this Quarterly Report on Form
10-Q, our Annual Report on Form 10-K for the fiscal year ended August 31, 2021,
our Current Reports on Form 8-K and our other filings with the Securities and
Exchange Commission. This discussion contains forward-looking statements that
involve risks and uncertainties. Our actual results could differ materially from
those discussed below. Factors that could cause such differences include, but
are not limited to, those identified below and those discussed in Item 1A. Risk
Factors in our Annual Report on Form 10-K for the year ended August 31, 2021.

Our MD&A is designed to provide a reader of our financial statements with a
narrative from the perspective of our management on our financial condition,
results of operations, liquidity and certain other factors that may affect our
future results. Our MD&A is presented in the following sections:

•Executive Overview
•Annual Subscription Value ("ASV")
•Client and User Additions
•Employee Headcount
•Results of Operations
•Non-GAAP Financial Measures
•Liquidity and Capital Resources
•Off-Balance Sheet Arrangements
•Foreign Currency
•Critical Accounting Policies and Estimates
•New Accounting Pronouncements

Executive Overview


FactSet Research Systems Inc. and its wholly-owned subsidiaries (collectively,
"we," "our," "us," the "Company" or "FactSet") is a global financial data and
analytics company with an open and flexible digital platform which focuses on
driving the investment community to see more, think bigger, and do its best
work. Our strategy is to build the leading open content and analytics platform
that delivers a differentiated advantage for our clients' success.

For over 40 years, the FactSet platform has delivered expansive data,
sophisticated analytics, and flexible technology that global financial
professionals need to power their critical investment workflows. Approximately
174,000 investment professionals including asset managers, asset owners,
bankers, wealth managers, corporate users, private equity and venture capital
professionals, and others use our personalized solutions to identify
opportunities, explore ideas, and gain a competitive advantage. Our solutions
span investment research, portfolio construction and analysis, trade execution,
performance measurement, risk management, and reporting across the investment
lifecycle.

We provide financial data and market intelligence on securities, companies,
industries and people to enable our clients to research investment ideas, as
well as offering them the capabilities to analyze, monitor and manage their
portfolios. We combine dedicated client service with open and flexible
technology offerings, such as a configurable desktop and mobile platform,
comprehensive data feeds, cloud-based digital solutions, and application
programming interfaces ("APIs"). We are a central figure within the global
securities marketplace and a foundation for security master files relied on by
critical front, middle and back-office functions around the world through CUSIP
Global Services ("CGS"). Our revenues are primarily derived from subscriptions
to our products and services such as workstations, portfolio analytics, and
market data.

We advance our industry by comprehensively understanding our clients' workflows,
solving their most complex challenges, and helping them achieve their goals. By
providing them with the leading open content and analytics platform, an
expansive universe of connected data they can trust, next-generation workflow
support designed to help them grow and see their next best action, and the
industry's most committed service specialists, we put our clients in a position
to outperform.

We are focused on growing our business through three reportable segments
("segments"): the Americas, EMEA and Asia Pacific. Refer to Note 17, Segment
Information for further discussion. Within each of our segments, we deliver
insight and information through our three workflows: Research & Advisory
Solutions; Analytics & Trading Solutions; and Content & Technology Solutions
("CTS").
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Business Strategy


Client needs and market dynamics continue to evolve at an accelerated pace with
an increasing demand for differentiated, personalized, and connected data, an
ongoing shift to multi-asset class investing, and cost rationalization as the
shift from active to passive investing continues. Clients are seeking new
cloud-based solutions that enable self-service and automation, open and flexible
systems, and increased efficiencies when integrating and managing data as part
of their own broader digital transformations.

FactSet's strategy focuses on building the leading open content and analytics
platform that delivers differentiated advantages for our clients' success, in
keeping with our purpose of enabling the investment community to see more, think
bigger and do their best work. We want to be the trusted partner of choice for
clients, to anticipate their needs and provide them with the most innovative
solutions to make them more efficient. This includes transforming the way our
clients discover, decide, and act on an opportunity using our digital platform;
purposefully increasing our pace and speed to market by streamlining how we
work; and investing in our future workforce. To execute on our strategy, we plan
on the following:

•Growing our digital platform: Scaling up our content refinery by providing the
most comprehensive and connected inventory of industry, proprietary, and
third-party data for the financial community, including granular data for key
industry verticals, private companies, wealth, and environmental social and
governance ("ESG"). Driving next-generation workflow solutions by creating
personalized and integrated solutions to streamline workflows which includes
solutions for asset managers, asset owners, sell side, wealth and corporate
clients. Our goal is to deliver tangible efficiencies to our clients by
connecting data and analytics with a cloud based eco-system, enabling them to
manage work more effectively through an integrated investment lifecycle.

•Delivering execution excellence: Building a more agile and digital first-minded
organization that increases the speed of our product creation and go-to-market
strategy. To capitalize on market trends and give our clients innovative tools,
we plan to release new products built on a cloud-based digital foundation as
well as migrating our existing data and applications to the cloud. Additionally,
we expect to rationalize our existing product portfolio to reinvest in higher
return products.

•Driving a growth mindset: Recruiting, training and empowering a diverse and
operationally efficient workforce to drive sustainable growth. To drive a more
performance-based culture, we are investing in talent who can create leading
technological solutions, efficiently execute our go-to-market strategy and
achieve our growth targets.

At the center of our strategy is the relentless focus on our clients and their
FactSet experience. We want to be a trusted partner and service provider,
offering hyper-personalized digital products for clients to research ideas,
uncover relevant insights, and leverage cognitive computing to help get the most
out of their data and analytics. Additionally, we continually evaluate business
opportunities such as acquisitions and partnerships to help us expand our
capabilities and competitive differentiators across the investment portfolio
lifecycle.

We are focused on growing our global business in three segments: the Americas,
EMEA and Asia Pacific. We believe this geographical strategic alignment helps us
better manage our resources, target our solutions and interact with our clients.
We further execute on our growth strategy by offering data, products, and
analytical applications within our three workflow solutions: Research &
Advisory; Analytics & Trading; and CTS.

Fiscal 2022 Third Quarter in Review


Revenues in the third quarter of fiscal 2022 were $488.8 million, an increase of
22.3% from the prior year period. Revenues increased across each of our
geographic segments, primarily in the Americas, followed by EMEA and Asia
Pacific, supported by increased revenues in all our workflow solutions, mainly
in CTS, followed by Research & Advisory and Analytics & Trading. Organic
revenues contributed 10.5% of the growth during the third quarter of fiscal
2022, compared with the prior year period.

Organic revenues exclude revenue related to acquisitions and dispositions
completed in the last 12 months, the amortization of deferred revenues' fair
value adjustments from purchase accounting related to acquisitions prior to
fiscal 2022, and the impacts of foreign currency movements on the current year
period. Acquisitions during fiscal 2022 and all future acquisitions will be
accounted for in accordance with our adoption of ASU 2021-08 and will not
include a fair value adjustment. Refer to Note 3,
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Recent Accounting Pronouncements for more information on ASU 2021-08. Refer to
Non-GAAP Financial Measures in Part I, Item 2 of this Quarterly Report on Form
10-Q for a reconciliation between revenues and organic revenues.

As of May 31, 2022, organic annual subscription value ("Organic ASV") plus
Professional Services totaled $1.77 billion, an increase of 10.1% over May 31,
2021. Organic ASV increased across all our segments, with the majority of the
increase related to the Americas, followed by EMEA and Asia Pacific, supported
by increases in our workflow solutions, mainly Research & Advisory, followed by
Analytics & Trading and CTS. Refer to Annual Subscription Value in Part I, Item
2 of this Quarterly Report on Form 10-Q for the definitions of Organic ASV and
Organic ASV plus Professional Services.

Operating income decreased 17.4% and diluted earnings per share ("EPS")
decreased 26.3% for the three months ended May 31, 2022 compared with the prior
year period. Operating margin decreased to 19.9% during the three months ended
May 31, 2022 compared with 29.5% in the prior year period. This decrease in
operating margin on a year-over-year basis was primarily due to impairment
charges related to vacating certain leased office space, higher professional
fees driven by costs incurred in connection with the acquisition of CGS, higher
amortization of intangibles related to amortization of acquired intangibles and
higher royalty fees related to certain contracts acquired as part of the
acquisition of CGS, partially offset by growth in revenues and lower costs
related to employee compensation, when expressed as a percentage of revenue.

CUSIP Global Services Acquisition


On December 24, 2021, we entered into a definitive agreement to acquire CGS,
previously operated by S&P Global Inc. on behalf of the American Bankers
Association, for $1.932 billion in cash, inclusive of preliminary working
capital adjustments. The acquisition was completed on March 1, 2022. CGS manages
a database of 60 different data elements uniquely identifying more than 50
million global financial instruments. It is the foundation for security master
files relied on by critical front, middle and back-office functions. CGS is the
exclusive provider of Committee on Uniform Security Identification Procedures
("CUSIP") and CUSIP International Number System ("CINS") identifiers globally
and also acts as the official numbering agency for International Securities
Identification Number ("ISIN") identifiers in the United States. We anticipate
that the CGS acquisition will significantly expand our critical role in the
global capital markets. Revenue from CGS will be recognized based on geographic
business activities in accordance with how our operating segments are currently
aligned. CGS will function as part of CTS.

The purchase price for the CGS acquisition was financed from the net proceeds of
the issuance of the Senior Notes and borrowings under the 2022 Credit
Facilities. Refer to Note 7, Acquisitions and Note 11, Debt for more information
on these defined terms as well as our acquisition of CGS, the Senior Notes and
the 2022 Credit Facilities.

COVID-19 Update

A novel strain of coronavirus, now known as COVID-19 ("COVID-19"), was first
reported in December 2019, and it has since extensively impacted the global
health and economic environment, with the World Health Organization
characterizing COVID-19 as a pandemic on March 11, 2020. In response to the
COVID-19 pandemic, we implemented a business continuity plan with a dedicated
incident management team to respond quickly and provide ongoing guidance so that
we could continue offering our clients uninterrupted products, services and
support while also protecting our employees. We believe these actions have been
successful and that the pandemic, and our responses, have not significantly
affected our financial results for the three months ended May 31, 2022.

At the outset of the pandemic, we required the vast majority of our employees at
our offices across the globe (including our corporate headquarters) to work
remotely and implemented global travel restrictions for our employees. Since
that time, we have re-opened many of our offices globally with a focus on
safety, while acting consistently with applicable local regulations. We
anticipate that the ability to open offices will vary significantly from region
to region based on a number of factors, including the availability of COVID-19
vaccines and the spread of COVID-19 variants. Our offices will not re-open fully
until local authorities permit us to do so and our own criteria and conditions
to ensure employee health and safety are satisfied.

As of May 31, 2022, there have been minimal interruptions in our ability to
provide our products, services and support to our clients. Working remotely has
had relatively little impact on the productivity of our employees, including our
ability to gather content. We continue to work closely with our clients to
provide consistent access to our products and services and have remained
flexible to achieve client priorities.

Based on our success working in a remote environment during the COVID-19
pandemic, we have implemented a new work standard under which employees in many
of our locations, where permitted by local laws and regulations, and where the
role permits, have the opportunity to choose between different work
arrangements. These include working in a hybrid arrangement,
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where an employee can split time between working from the office and working
from a pre-approved remote location, or a fully remote arrangement, where an
employee can work entirely from a pre-approved remote location.

Our revenues, earnings, and ASV are relatively stable and predictable as a
result of our subscription-based business model. To date, the COVID-19 pandemic
has not had a material negative impact on our revenues, earnings or ASV. As we
continue to work in remote and hybrid environments, reductions in discretionary
spending, particularly travel and entertainment, have more than offset any
related increased expenses. Given our transition to our new work standard, we
anticipate that many of these expense reductions will continue going forward,
including incurring less travel and entertainment spending than we did
pre-pandemic. We also reassessed our real estate footprint in light of these new
work arrangements and have exited office space that we believe will no longer be
necessary. For the nine months ended May 31, 2022, we recognized $62.2 million
in impairment charges related to vacating certain leased office space to resize
our real estate footprint for the hybrid work environment. While we will
continue to evaluate our real estate needs, we expect that this initiative is
largely complete, and we do not currently anticipate additional similarly-sized
real estate impairment charges as part of the reduction of our real estate
footprint.

Refer to Item 1A. Risk Factors of our Annual Report on Form 10-K for the fiscal
year ended August 31, 2021 for further discussion of the potential impact of the
COVID-19 pandemic on our business.

Ukraine/Russia Conflict


As the Russian invasion of Ukraine continues to evolve, we are closely
monitoring the current and potential impact on our business, our people, and our
clients. We have taken all necessary steps to ensure compliance with all
applicable regulatory restrictions on international trade and financial
transactions. On March 18, 2022, we announced that we are discontinuing all
commercial operations and delivery of products and services to clients inside
Russia. In addition, we have identified all active vendors in Russia and have
terminated our contracts with them. We have suspended all new business, trials,
and prospecting activities in Russia. Total revenues associated with clients in
Russia are not material to our consolidated financial results, and we anticipate
termination of Russian vendors will not have a material impact on our business
or client relationships. We have no offices in Russia or Ukraine, and none of
our employees or contractors has been directly impacted by the crisis. We are
monitoring the regional and global ramifications of the unfolding events in the
area, are in close contact with our office in Latvia, and are reviewing our
business continuity plans to ensure that we are prepared in the event this
office is impacted. Our cybersecurity teams are on high alert and ready to
respond in the event of an attempted systems compromise.

Annual Subscription Value ("ASV")

We believe ASV reflects our ability to grow recurring revenues and generate positive cash flow and is the key indicator of the successful execution of our business strategy.


-"ASV" at any point in time represents our forward-looking revenues for the next
12 months from all subscription services currently being supplied to clients,
excluding revenues from Professional Services.
-"Organic ASV" at any point in time equals our ASV excluding ASV from
acquisitions and dispositions completed within the last 12 months and the
effects of foreign currency movements on the current year period.
-"Professional Services" are revenues derived from project-based consulting and
implementation.
-"Organic ASV plus Professional Services" at any point in time equals the sum of
Organic ASV and Professional Services.

Organic ASV plus Professional Services


The following table presents the calculation of Organic ASV plus Professional
Services as of May 31, 2022. With proper notice provided as contractually
required, our clients can add to, delete portions of, or terminate service,
subject to certain limitations.
(in millions)                                          As of May 31, 2022

As reported ASV plus Professional Services(1) $ 1,939.9 Currency impact(2)

                                                  5.6
Acquisition ASV(3)                                               (170.5)
Organic ASV plus Professional Services                $         1,775.0
Organic ASV plus Professional Services growth rate                 10.1  %


(1)Includes $24.4 million in Professional Services as of May 31, 2022.

(2)The impact from foreign currency movements.

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(3)Acquired ASV from acquisitions completed within the last 12 months.



As of May 31, 2022, Organic ASV plus Professional Services was $1.77 billion, an
increase of 10.1% compared with May 31, 2021. The increase in year-over-year
Organic ASV was largely attributed to increased sales to existing clients,
inclusive of price increases, followed by new client sales, partially offset by
existing client cancellations.

Organic ASV increased across all our geographic segments, with the majority of
the increase related to the Americas, followed by EMEA and Asia Pacific. This
increase was driven by additional sales in our workflow solutions, primarily
Research & Advisory, followed by Analytics & Trading and CTS. Sales increased in
Research & Advisory mainly due to higher demand for our workstations. Sales
increased in Analytics & Trading mainly from demand for our portfolio analytics
solutions and performance and reporting products. CTS sales increased primarily
due to purchases of company financial data, such as fundamentals, estimates and
ownership, along with data management solutions to empower data connectivity.

Segment ASV


As of May 31, 2022, ASV from the Americas represented 64% of total ASV and was
$1,220.4 million, an increase from $993.4 million as of May 31, 2021. Americas
Organic ASV increased to $1,093.4 million as of May 31, 2022, a 10.1% increase
compared with May 31, 2021.

As of May 31, 2022, ASV from EMEA represented 26% of total ASV and was $503.1
million, an increase from $436.4 million as of May 31, 2021. EMEA Organic ASV
increased to $471.0 million as of May 31, 2022, a 8.3% increase compared with
May 31, 2021.

As of May 31, 2022, ASV from Asia Pacific represented 10% of total ASV and was
$192.0 million, an increase from $163.4 million as of May 31, 2021. Asia Pacific
Organic ASV increased to $186.1 million as of May 31, 2022, a 14.3% increase
compared with May 31, 2021.

The increase in Organic ASV across all our segments was largely attributed to
increased sales to existing clients, inclusive of price increases, followed by
new client sales, partially offset by existing client cancellations. Organic ASV
increased in the Americas primarily due to higher sales in Research & Advisory,
followed by Analytics & Trading. EMEA Organic ASV increased due to higher sales
in Research & Advisory, followed by CTS and Analytics & Trading. The increase in
Asia Pacific Organic ASV was driven by higher sales in Research & Advisory,
followed by Analytics & Trading and CTS.

Buy-side and Sell-side Organic ASV Growth


Buy-side and sell-side Organic ASV growth rates at May 31, 2022, compared with
May 31, 2021, were 9.6% and 12.9%, respectively. Buy-side clients account for
approximately 84% of our Organic ASV, consistent with the prior year period,
primarily including asset managers, wealth managers, asset owners, channel
partners, hedge funds, and corporate firms. The remainder of our Organic ASV is
derived from sell-side firms, primarily including broker-dealers, banking and
advisory, private equity and venture capital firms.

Client and User Additions

The table below presents our total clients and users:

                As of May 31, 2022      As of May 31, 2021      Change
Clients(1)            7,319                   6,172             18.6  %
Users               173,698                 155,004             12.1  %

(1)The client count includes clients with ASV of $10,000 and above.


Our total client count was 7,319 as of May 31, 2022, a net increase of 18.6%, or
1,147 clients, in the last 12 months, mainly due to an increase in corporate,
wealth management and private equity and venture capital clients. This increase
is due to our continued focus on our on- and off-platform workflow-focused
solutions, connected content and client-focused services.

As of May 31, 2022, there were 173,698 professionals using FactSet, representing
a net increase of 12.1%, or 18,694 users, in the last 12 months, driven
primarily by an increase in banking clients from the sell-side, followed by an
increase in wealth management clients, asset managers and corporate clients from
the buy-side. The increase in users was mainly due to increased new hiring at
our banking clients and the addition of new clients.

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Annual client retention was greater than 95% of ASV for the period ended May 31,
2022, consistent with the prior year period. When expressed as a percentage of
clients, annual retention was approximately 92% for the period ended May 31,
2022, an improvement from approximately 91% for the period ended May 31, 2021.

Employee Headcount


As of May 31, 2022, our employee headcount was 10,691, a decrease of 0.2%
compared with 10,713 employees as of May 31, 2021. This reduction in headcount
was primarily due to a decrease of 6.2% in the Americas and a decrease of 0.1%
in EMEA, partially offset by an increase of 1.9% in Asia Pacific. At May 31,
2022, 7,056 employees were located in Asia Pacific, 2,287 in the Americas, and
1,348 in EMEA.

Results of Operations

For an understanding of the significant factors that influenced our performance
for the three and nine months ended May 31, 2022 and May 31, 2021, the following
discussion should be read in conjunction with the Consolidated Financial
Statements and related notes presented in this Quarterly Report on Form 10-Q.

The following table summarizes the results of operations for the periods
described:

                                               Three Months Ended                                                   Nine Months Ended
                                                     May 31,                                                             May 31,
(in thousands, except per share data)        2022               2021                 % Change      2022                   2021                     % Change
Revenues                                 $ 488,751          $ 399,558                     22.3  %         $ 1,344,595            $ 1,179,551                  14.0  %
Cost of services                         $ 222,618          $ 205,257                      8.5  %         $   629,162            $   588,868                   6.8  %
Selling, general and administrative      $ 119,881          $  76,599                     56.5  %         $   309,185            $   235,818                  31.1  %
Long-lived asset impairments             $  48,998          $       -                         N/M         $    62,985            $         -                      N/M
Operating income                         $  97,254          $ 117,702                    (17.4) %         $   343,263            $   354,865                  (3.3) %
Net income                               $  74,910          $ 100,679                    (25.6) %         $   292,495            $   298,528                  (2.0) %
Diluted earnings per common share        $    1.93          $    2.62                    (26.3) %         $      7.58            $      7.73                  (1.9) %
Diluted weighted average common shares      38,720             38,488                                          38,607                 38,602


Revenues

Three months ended May 31, 2022 compared with three months ended May 31, 2021


Revenues for the three months ended May 31, 2022 were $488.8 million, an
increase of 22.3%. The increase in revenues was largely attributable to
increased sales to existing clients, inclusive of price increases, followed by
new client sales, partially offset by existing client cancellations. Revenues
increased across all our geographic segments, primarily from the Americas,
followed by EMEA and Asia Pacific, driven by increased revenues in all of our
workflow solutions, primarily in CTS, followed by Research & Advisory and
Analytics & Trading, compared with the prior year. Organic revenues increased to
$441.7 million for the three months ended May 31, 2022, a 10.5% increase over
the prior year period.

The growth in revenues of 22.3% was composed of growth in organic revenues of
10.5% and a 12.3% increase primarily related to acquisition-related revenues,
partially offset by a 0.5% decrease from foreign currency exchange rate
fluctuations.

Nine months ended May 31, 2022 compared with nine months ended May 31, 2021


Revenues for the nine months ended May 31, 2022 was $1,344.6 million, an
increase of 14.0%. The increase in revenues was largely attributable to
increased sales to existing clients, inclusive of price increases, followed by
new client sales, partially offset by existing client cancellations. Revenues
increased across all our geographic segments, primarily from the Americas,
followed by EMEA and Asia Pacific, driven by increased revenues in all of our
workflow solutions, primarily in CTS and Research & Advisory, followed by
Analytics & Trading, compared with the prior year. Organic revenues increased to
$1,295.6 million for the nine months ended May 31, 2022, a 9.8% increase over
the prior year period.

The growth in revenues of 14.0% was reflective of organic revenue growth of 9.8%
and a 4.5% increase primarily related to acquisition-related revenue, partially
offset by a 0.3% decrease from foreign currency exchange rate fluctuations.

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Revenues by Segment

                      Three Months Ended                              Nine Months Ended
                           May 31,                                         May 31,

(in thousands)       2022            2021         % Change          2022              2021          % Change
Americas         $ 309,740       $ 253,786          22.0  %    $   850,312       $   746,112          14.0  %
% of revenues         63.4  %         63.5  %                         63.2  %           63.3  %
EMEA             $ 128,326       $ 106,833          20.1  %    $   357,920       $   318,103          12.5  %
% of revenues         26.3  %         26.7  %                         26.6  %           26.9  %

Asia Pacific $ 50,685 $ 38,939 30.2 % $ 136,363

      $   115,336          18.2  %
% of revenues         10.3  %          9.8  %                         10.2  %            9.8  %

Consolidated $ 488,751 $ 399,558 22.3 % $ 1,344,595

$ 1,179,551 14.0 %

Three months ended May 31, 2022 compared with three months ended May 31, 2021

Americas


Revenues from our Americas segment increased 22.0% to $309.7 million during the
three months ended May 31, 2022, compared with $253.8 million from the same
period a year ago. The increased revenues were driven by higher sales in all of
our workflow solutions, primarily in Research & Advisory and CTS, followed by
Analytics & Trading. The growth in revenues of 22.0% was reflective of increased
organic revenues of 7.4% and a 14.6% increase primarily due to the impact of
acquisition-related revenues.

EMEA


Revenues from our EMEA segment increased 20.1% to $128.3 million during the
three months ended May 31, 2022, compared with $106.8 million from the same
period a year ago. The increased revenues were driven by higher sales in all of
our workflow solutions, primarily in CTS, followed by Research & Advisory and
Analytics & Trading. The growth in revenues of 20.1% was reflective of increased
organic revenues of 13.2% and an 8.2% increase primarily due to the impact of
acquisition-related revenues, partially offset by a 1.3% decrease related to
foreign currency exchange rate fluctuations.

Asia Pacific


Revenues from our Asia Pacific segment increased 30.2% to $50.7 million during
the three months ended May 31, 2022, compared with $38.9 million from the same
period a year ago. The increased revenues were driven by higher sales in all of
our workflow solutions, primarily in CTS, followed by Research & Advisory and
Analytics & Trading. The growth in revenues of 30.2% was reflective of increased
organic revenues of 23.6% and an 8.9% increase due to the impact of
acquisition-related revenues, partially offset by a 2.3% decrease related to
foreign currency exchange rate fluctuations.

Nine months ended May 31, 2022 compared with nine months ended May 31, 2021

Americas


Revenues from our Americas segment increased 14.0% to $850.3 million during the
nine months ended May 31, 2022, compared with $746.1 million from the same
period a year ago. The increased revenues were driven by higher sales in all of
our workflow solutions, primarily in CTS and Research & Advisory, followed by
Analytics & Trading. The growth in revenues of 14.0% was due to organic revenue
growth of 8.4% and a 5.6% increase primarily due to the impact of
acquisition-related revenue.

EMEA


Revenues from our EMEA segment increased 12.5% to $357.9 million during the nine
months ended May 31, 2022, compared with $318.1 million from the same period a
year ago. The increased revenues were driven by higher sales in all of our
workflow solutions, primarily in CTS, followed by Research & Advisory and
Analytics & Trading. The growth in revenues of 12.5% was driven by organic
revenue growth of 10.5% and a 2.7% increase primarily due to the impact of
acquisition-related revenue, partially offset by an 0.7% decrease from foreign
currency exchange rate fluctuations.

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Asia Pacific

Revenues from our Asia Pacific segment increased 18.2% to $136.4 million during
the nine months ended May 31, 2022, compared with $115.3 million from the same
period a year ago. The increased revenues were driven by higher sales across all
of our workflow solutions, primarily in CTS, followed by Analytics & Trading and
Research & Advisory. The growth in revenues of 18.2% was due mainly to organic
revenues growth of 17.0% and a 3.0% increase from acquisition-related revenue,
partially offset by a 1.8% decrease from foreign currency exchange rate
fluctuations.

Revenues by Workflow Solution

Three months ended May 31, 2022 compared with three months ended May 31, 2021


The growth in revenues of 22.3% for the three months ended May 31, 2022,
compared with the same period a year ago, was due to revenue growth across each
of our segments supported by increased revenues from our workflow solutions,
primarily from CTS, followed by Research & Advisory and Analytics & Trading. The
increase in CTS revenues was driven mainly by sales of company financial data,
such as fundamentals, estimates and ownership, and the inclusion of CUSIP
related data licensing and issuance revenues. The increase in Research &
Advisory revenues was driven mainly by higher demand for our workstations. The
increase in revenues from Analytics & Trading was primarily due to increased
demand for our portfolio analytics solutions.

Nine months ended May 31, 2022 compared with nine months ended May 31, 2021


The growth in revenues of 14.0% for the nine months ended May 31, 2022, compared
with the same period a year ago, was due to revenue growth across our segments
supported by increased revenues from our workflow solutions, primarily from CTS
and Research & Advisory, followed by Analytics & Trading. The increase in CTS
revenues was driven mainly by increased purchases of company financial data,
such as fundamentals, estimates and ownership, and the inclusion of CUSIP
related data licensing and issuance revenues. The increase in Research &
Advisory revenues was driven mainly by higher demand for our workstations. The
increase in Analytics & Trading revenues was mainly due to increased sales of
our performance and reporting products and portfolio analytics solutions.

Operating Expenses

                                              Three Months Ended                                            Nine Months Ended
                                                    May 31,                                                      May 31,

(in thousands)                              2022               2021              % Change                2022                2021              % Change
Cost of services                        $ 222,618          $ 205,257                   8.5  %       $   629,162          $ 588,868                   6.8  %
Selling, general and administrative       119,881             76,599                  56.5  %           309,185            235,818                  31.1  %
Long-lived asset impairments               48,998                  -                      N/M            62,985                  -                      

N/M

Total operating expenses                $ 391,497          $ 281,856                  38.9  %       $ 1,001,332          $ 824,686                  21.4  %

Operating income                        $  97,254          $ 117,702                 (17.4) %       $   343,263          $ 354,865                  (3.3) %
Operating margin                             19.9  %            29.5  %                                    25.5  %            30.1  %


Cost of Services

Three months ended May 31, 2022 compared with three months ended May 31, 2021


Cost of services increased 8.5% to $222.6 million for the three months ended
May 31, 2022, compared with $205.3 million in the same period a year ago,
primarily due to an increase in amortization of intangible assets and royalty
fees, partially offset by a decrease in employee compensation expense.

Cost of services, when expressed as a percentage of revenues, was 45.5% for the
three months ended May 31, 2022, a decrease of 580 basis points compared with
the same period a year ago. This decrease was primarily due to lower employee
compensation expense, partially offset by an increase in amortization of
intangible assets and royalty fees. Employee compensation expense decreased 740
basis points, due primarily to a shift in headcount distribution from higher to
lower cost locations and a net reduction in cost of services employee headcount
of 138, partially offset by higher base salaries. Amortization of intangible
assets increased 230 basis points mainly due to increased amortization related
to acquired intangible

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Table of Contents assets. Royalty fees increased cost of services by 170 basis points due to contracts acquired in connection with the acquisition of CGS.

Nine months ended May 31, 2022 compared with nine months ended May 31, 2021

For the nine months ended May 31, 2022, cost of services increased 6.8% to $629.2 million compared with $588.9 million in the same period a year ago, primarily due to an increase in amortization of intangible assets, computer-related expenses, royalty fees, employee compensation expense and data costs.


Cost of services, when expressed as a percentage of revenues, was 46.8% for the
nine months ended May 31, 2022, a decrease of 310 basis points compared with the
same period a year ago. This decrease was primarily driven by lower employee
compensation expense and data costs, partially offset by higher amortization of
intangible assets and royalty fees as a percentage of revenue. Employee
compensation expense decreased 390 basis points, primarily due to a shift in
headcount distribution from higher to lower cost locations and a net reduction
in cost of services employee headcount of 138, partially offset by higher annual
base salaries, a one-time restructuring charge to drive organizational
realignment and a decrease in capitalization of compensation costs related to
development of our internal-use software projects. Data costs decreased 50 basis
points, primarily due to revenue growth outpacing the cost of content, partially
offset by a non-recurring charge for certain data content. Amortization of
intangible assets increased 100 basis points, mainly due to higher amortization
related to acquired intangibles and increased amortization from capitalized
internal-use software. Royalty fees increased cost of services 60 basis points
due to contracts acquired in connection with the acquisition of CGS.

Selling, General and Administrative

Three months ended May 31, 2022 compared with three months ended May 31, 2021


Selling, general and administrative ("SG&A") expenses increased 56.5% to $119.9
million for the three months ended May 31, 2022, compared with $76.6 million for
the same period a year ago, primarily due to higher employee compensation
expense and professional fees.

SG&A expenses, when expressed as a percentage of revenues, were 24.5% for the
three months ended May 31, 2022, an increase of 540 basis points over the prior
year period. This increase was primarily due to higher professional fees and
employee compensation expense as a percentage of revenue. Professional fees
increased 270 basis points, primarily driven by costs incurred in connection
with the acquisition of CGS. Employee compensation expense increased 140 basis
points, primarily due to increased variable compensation, a net increase in SG&A
employee headcount of 116, increased stock-based compensation expense and higher
annual base salaries.

Nine months ended May 31, 2022 compared with nine months ended May 31, 2021


For the nine months ended May 31, 2022, SG&A expenses increased 31.1% to $309.2
million, compared with $235.8 million for the same period a year ago, primarily
due to higher employee compensation expense and professional fees.

SG&A expenses, expressed as a percentage of revenues, were 23.0% for the nine
months ended May 31, 2022, an increase of 300 basis points over the prior year
period. This increase was primarily driven by higher professional fees and
employee compensation expense as a percentage of revenue. Professional fees
increased 130 basis points, primarily driven by costs incurred in connection
with the acquisition of CGS. Employee compensation expense increased 100 basis
points, primarily due to increased variable compensation, a net increase in SG&A
employee headcount of 116, higher annual base salaries and higher stock-based
compensation expense.

Long-Lived Asset Impairments

Three months ended May 31, 2022 compared with three months ended May 31, 2021


Long-lived asset impairments were $49.0 million, or 10.0% when expressed as a
percentage of revenues, for the three months ended May 31, 2022. The impairment
charges related primarily to lease ROU assets and Property, equipment and
leasehold improvements ("PPE") associated with vacating certain leased office
space. We fully impaired the lease ROU assets for locations we vacated with no
intention to sublease. We recognized an impairment for locations we intend to
sublease when the estimated fair value of the lease ROU asset was less than its
carrying value. Substantially all the PPE associated with the vacated lease
office space was fully impaired as there are no expected future cash flows
related to these items. Impairment charges related to our lease ROU assets and
PPE were $24.2 million and $24.6 million, respectively, for the three months
ended May 31, 2022.
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Nine months ended May 31, 2022 compared with nine months ended May 31, 2021


Long-lived asset impairments were $63.0 million, or 4.7% when expressed as a
percentage of revenues, for the nine months ended May 31, 2022. The impairment
charges related primarily to lease ROU assets and PPE associated with vacating
certain leased office space. We fully impaired the lease ROU assets for
locations we vacated with no intention to sublease. We recognized an impairment
for locations we intend to sublease when the estimated fair value of the lease
ROU asset was less than its carrying value. Substantially all the PPE associated
with the vacated lease office space was fully impaired as there are no expected
future cash flows related to these items. Impairment charges related to our
lease ROU assets and PPE were $31.5 million and $30.7 million, respectively, for
the nine months ended May 31, 2022.

Operating Income and Operating Margin

Three months ended May 31, 2022 compared with three months ended May 31, 2021


Operating income decreased 17.4% to $97.3 million for the three months ended
May 31, 2022, compared with $117.7 million in the prior year. Operating income
decreased primarily due to impairment of long-lived assets, higher professional
fees, higher amortization of intangible assets, higher employee compensation
expense and higher royalty fees, partially offset by growth in revenues of
22.3%. Foreign currency exchange rate fluctuations, net of hedge activity,
decreased operating income by $1.3 million.

Operating margin decreased to 19.9% during the three months ended May 31, 2022,
compared with 29.5% in the prior year period. Operating margin decreased mainly
due to the impairment of long-lived assets, professional fees, amortization of
intangible assets and royalty fees, partially offset by growth in revenues and
lower employee compensation expense.

Nine months ended May 31, 2022 compared with nine months ended May 31, 2021


Operating income decreased 3.3% to $343.3 million for the nine months ended
May 31, 2022 compared with $354.9 million in the prior year period. Operating
income decreased primarily due to impairment of long-lived assets, higher
employee compensation expense, professional fees, amortization of intangible
assets, computer-related expenses, royalty fees and data costs, partially offset
by growth in revenues of 14.0%. Foreign currency exchange rate fluctuations, net
of hedge activity, decreased operating income by $6.7 million.

Operating margin decreased to 25.5% for the nine months ended May 31, 2022, compared with 30.1% in the prior year period. Operating margin decreased primarily due to impairment of long-lived assets, higher professional fees, amortization of intangible assets and royalty fees, partially offset by growth in revenues and lower employee compensation expense and data costs.

Operating Income by Segment

Our internal financial reporting structure is based on three reportable segments: the Americas; EMEA; and Asia Pacific. Refer to Note 17, Segment Information for further discussion regarding our segments.

                             Three Months Ended                          Nine Months Ended
                                  May 31,                                     May 31,

(in thousands)              2022           2021         % Change        2022           2021         % Change
Americas                 $  11,212      $  51,800        (78.4) %    $ 115,613      $ 161,789        (28.5) %
EMEA                        53,228         41,468         28.4  %      139,826        122,392         14.2  %
Asia Pacific                32,814         24,434         34.3  %       

87,824 70,684 24.2 % Total Operating Income $ 97,254 $ 117,702 (17.4) % $ 343,263 $ 354,865 (3.3) %

Three months ended May 31, 2022 compared with three months ended May 31, 2021

Americas


Americas operating income decreased 78.4% to $11.2 million during the three
months ended May 31, 2022, compared with $51.8 million in the same period a year
ago. This decrease in operating income was due to an impairment of long-lived
assets, higher amortization of intangible assets, professional fees, employee
compensation expense and royalty fees, partially offset by growth in revenues of
22.0%. The impairment charges related mainly to lease ROU assets and PPE
associated with vacating certain leased office space. Amortization of intangible
assets increased primarily due to increased amortization related to
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acquired intangibles. Professional fees increased primarily due to costs
incurred in connection with the acquisition of CGS. Employee compensation
expense increased mainly due to increased variable compensation, higher stock
compensation expense and higher annual base salaries, partially offset by a net
decrease in employee headcount of 152. Royalty fees increased due to contracts
acquired in connection with the acquisition of CGS.

EMEA


EMEA operating income increased 28.4% to $53.2 million during the three months
ended May 31, 2022, compared with $41.5 million recognized during the same
period a year ago. The increase in EMEA operating income was due to growth in
revenues of 20.1% as well as lower bad debt expense and employee compensation
expense, partially offset by an impairment of long-lived assets. Employee
compensation expense decreased mainly due to lower annual base salaries
primarily driven by foreign currency exchange rate fluctuations and
restructuring charges. The impairment charges related mainly to our lease ROU
assets and PPE associated with vacating certain leased office space.

Asia Pacific


Asia Pacific operating income increased 34.3% to $32.8 million during the three
months ended May 31, 2022, compared with $24.4 million in the same period a year
ago. This increase in operating income was mainly due to growth in revenues of
30.2%, partially offset by higher employee compensation expense. Employee
compensation expense increased mainly due to higher annual base salaries,
inclusive of a net increase in employee headcount of 132.

Nine months ended May 31, 2022 compared with nine months ended May 31, 2021

Americas


Americas operating income decreased 28.5% to $115.6 million during the nine
months ended May 31, 2022, compared with $161.8 million in the same period a
year ago. This decrease in operating income was due to an impairment of
long-lived assets, higher employee compensation expense, professional fees,
amortization of intangible assets, computer related expenses and royalty fees,
partially offset by growth in revenues of 14.0%. The impairment charges related
mainly to our lease ROU assets and PPE associated with vacating certain leased
office space. Employee compensation expense increased primarily due to increased
variable compensation, higher stock compensation expense, the impact of a
one-time restructuring charge to drive organizational realignment, and a
decrease in capitalization of compensation costs related to development of our
internal-use software projects, partially offset by a decrease in annual base
salary driven by a net decrease in employee headcount of 152. Professional fees
increased primarily due to costs incurred in connection with the acquisition of
CGS. Amortization of intangible assets increased primarily due to increased
amortization related to acquired intangibles, as well as continued investment in
capitalized internal-use software, with more assets placed in service.
Computer-related expenses increased primarily due to increased spend from our
migration to cloud-based hosting services and licensed software arrangements.
Royalty fees increased due to contracts acquired in connection with the
acquisition of CGS.

EMEA


EMEA operating income increased 14.2% to $139.8 million during the nine months
ended May 31, 2022, compared with $122.4 million in the same period a year ago.
The increase in EMEA operating income was primarily due to growth in revenues of
12.5%, a decrease in bad debt expense and amortization of intangible assets,
partially offset by an impairment of long-lived assets, higher employee
compensation expense and data costs. Amortization of intangible assets decreased
as certain acquired intangible assets were fully amortized during the third
quarter of fiscal 2022. The impairment charges related mainly to our lease ROU
assets and PPE associated with vacating certain leased office space. Employee
compensation expense increased mainly due to the impact of a one-time
restructuring charge to drive organizational realignment. Data costs increased
primarily due to a non-recurring charge for certain data content.

Asia Pacific


Asia Pacific operating income increased 24.2% to $87.8 million during the nine
months ended May 31, 2022, compared with $70.7 million in the same period a year
ago. The increase in Asia Pacific operating income was mainly due to growth in
revenues of 18.2%, partially offset by an increase in employee compensation
expense. Employee compensation expense increased mainly due to higher annual
base salaries, inclusive of a net increase in employee headcount of 132, and
increased variable compensation.
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Income Taxes, Net Income and Diluted Earnings per Share

Income Taxes

The provision for income taxes is as follows:

                                  Three Months Ended             Nine Months Ended
                                        May 31,                       May 31,
(in thousands)                   2022            2021            2022         2021
Income before income taxes    $ 85,280       $ 114,276       $ 327,166    $ 349,174
Provision for income taxes    $ 10,370       $  13,597       $  34,671    $  50,646
Effective tax rate                12.2  %         11.9  %         10.6  %      14.5  %



Our effective tax rate is lower than the applicable U.S. corporate income tax
rate for the three and nine months ended May 31, 2022, driven mainly by research
and development ("R&D") tax credits and a foreign derived intangible income
("FDII") deduction. Our effective tax rate for the three and nine months ended
May 31, 2022 is further reduced by windfall tax benefits associated with the
employee exercise of stock options.

Three months ended May 31, 2022 compared with three months ended May 31, 2021


For the three months ended May 31, 2022, the provision for income taxes was
$10.4 million, compared with $13.6 million for the same period a year ago. The
provision decreased mainly due to lower pretax income for the three months ended
May 31, 2022, compared with the prior year period.

Nine months ended May 31, 2022 compared with nine months ended May 31, 2021


For the nine months ended May 31, 2022, the provision for income taxes was $34.7
million, compared with $50.6 million for the same period a year ago. The
provision decreased mainly due to lower pretax income and $12.0 million in
higher windfall tax benefit from stock-based compensation for the nine months
ended May 31, 2022, compared with the prior year period.

Net Income and Diluted Earnings per Share

                                              Three Months Ended                                           Nine Months Ended
                                                    May 31,                                                     May 31,

(in thousands, except for per share
data)                                       2022               2021              % Change               2022               2021              % Change
Net income                              $  74,910          $ 100,679                 (25.6) %       $ 292,495          $ 298,528                  (2.0) %

Diluted earnings per common share $ 1.93 $ 2.62

          (26.3) %       $    7.58          $    7.73                  (1.9) %
Diluted weighted average common shares     38,720             38,488                   0.6  %          38,607             38,602                     -  %


Three months ended May 31, 2022 compared with three months ended May 31, 2021


Net income decreased 25.6% to $74.9 million and diluted earnings per share
("EPS") decreased 26.3% to $1.93 for the three months ended May 31, 2022,
compared with the same period a year ago. Net income and diluted EPS decreased
primarily due to lower operating income mainly due to impairment charges related
to vacating certain leased office space and higher interest expense related to
our debt refinancing, partially offset by a reduction in the provision for
income taxes. EPS also decreased due to an increase in our diluted weighted
average shares outstanding compared to the same period a year ago.

Nine months ended May 31, 2022 compared with nine months ended May 31, 2021


Net income decreased 2.0% to $292.5 million and diluted EPS decreased 1.9% to
$7.58 for the nine months ended May 31, 2022, compared with the same period a
year ago. Net income and diluted EPS decreased primarily due to lower operating
income mainly due to impairment charges related to vacating certain leased
office space and higher interest expense related to our debt refinancing,
partially offset by a reduction in the provision for income taxes.

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Non-GAAP Financial Measures


To supplement the financial measures prepared in accordance with generally
accepted accounting principles in the United States ("GAAP"), we use non-GAAP
financial measures including organic revenues, adjusted operating income,
adjusted operating margin, adjusted net income, EBITDA, adjusted EBITDA and
adjusted diluted EPS. The reconciliations of these non-GAAP financial measures
to the most directly comparable financial measures calculated and presented in
accordance with GAAP are show in the tables below. These non-GAAP financial
measures should not be considered in isolation from, as a substitute for or
superior to, financial measures reported in accordance with GAAP. Moreover,
these non-GAAP financial measures have limitations in that they do not reflect
all the items associated with the operations of the business as determined in
accordance with GAAP. Other companies may calculate similarly titled non-GAAP
financial measures differently that we do, limiting the usefulness of those
measures for comparative purposes.

Despite the limitations of these non-GAAP financial measures, we believe these
adjusted financial measures, and the information they provide, are useful in
viewing our performance using the same tools that management uses to gauge
progress in achieving our goals. Adjusted measures may also facilitate
comparisons to our historical performance.

The table below provides an unaudited reconciliation of revenues to adjusted revenues and organic revenues.

                                                   Three Months Ended
                                                        May 31,

(In thousands)                                    2022           2021         % Change
Revenues                                       $ 488,751      $ 399,558         22.3  %
  Deferred revenues fair value adjustment(1)           1            181
Adjusted revenues                                488,752        399,739         22.3  %
  Acquired revenues(2)                           (49,385)             -
  Currency impact(3)                               2,326              -
Organic revenues                               $ 441,693      $ 399,739         10.5  %


(1)The amortization effect of the purchase accounting adjustment on the fair
value of acquired deferred revenues.
(2)Revenues from acquisitions completed within the last 12 months.
(3)The impact from foreign currency movements over the past 12 months.
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The table below provides an unaudited reconciliation of operating income, operating margin, net income and diluted EPS to adjusted operating income, adjusted operating margin, adjusted net income, EBITDA, adjusted EBITDA and adjusted diluted EPS.

                                                        Three Months Ended
                                                             May 31,

(In thousands, except per share data)                  2022            2021         % Change
Operating income                                   $  97,254       $ 117,702         (17.4) %
Deferred revenues fair value adjustment                    1             181
Intangible asset amortization                         18,548           5,741
Real estate charges(4)                                48,797               -
Business acquisition costs                            12,408               -
Restructuring / severance                              1,079               -
Transformation costs (1)                                 979           2,841

   Adjusted operating income                       $ 179,066       $ 126,465          41.6  %
   Operating margin                                     19.9  %         29.5  %
   Adjusted operating margin(2)                         36.6  %         

31.6 %


Net income                                         $  74,910       $ 100,679         (25.6) %
Deferred revenues fair value adjustment                    1             

150

Intangible asset amortization                         16,184           4,746
Real estate charges(4)                                42,577               -
Business acquisition costs                            10,827               -
Restructuring / severance                                941               -
Transformation costs(1)                                  854           2,349

Income tax items                                        (500)         (3,114)
   Adjusted net income(3)                          $ 145,794       $ 104,810          39.1  %

Net income                                         $  74,910       $ 100,679
Interest expense, net                                 12,051           1,839
Income taxes                                          10,370          13,597
Depreciation and amortization expense                 27,349          17,223
EBITDA                                             $ 124,680       $ 133,338          (6.5) %
Real estate charges(4)                                48,797               -
Adjusted EBITDA                                    $ 173,477       $ 133,338          30.1  %

Diluted earnings per common share                  $    1.93       $    2.62         (26.3) %
Deferred revenues fair value adjustment                 0.00            0.00
Intangible asset amortization                           0.42            0.12
Real estate charges(4)                                  1.10               -
Business acquisition costs                              0.28               -
Restructuring / severance                               0.02               -
Transformation costs(1)                                 0.02            0.06

Income tax items                                       (0.01)          (0.08)

Adjusted diluted earnings per common share(3) $ 3.76 $ 2.72 38.2 % Weighted average common shares (Diluted)

              38,720          

38,488

(1)Costs primarily related to professional fees associated with the ongoing multi-year investment plan.

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(2)Adjusted operating margin is calculated as Adjusted operating income divided by Adjusted revenues as shown in the revenues reconciliation table above.


(3)For purposes of calculating Adjusted net income and Adjusted diluted earnings
per share, Intangible asset amortization, Deferred revenues fair value
adjustments and other items were taxed at the quarterly effective tax rates of
12.7% for fiscal 2022 and 17.3% for fiscal 2021.

(4)Costs related to impairment charges of our lease ROU assets and PPE associated with vacating certain leased office space.

Liquidity and Capital Resources


Our cash flows provided by operating activities, existing cash and cash
equivalents, supplemented with our long-term debt borrowings, have been
sufficient to fund our operations while allowing us to invest in activities that
support the long-term growth of our operations. Generally, some or all of the
remaining available cash flow has been used to among other things, service our
existing and future debt obligations, satisfy our working capital requirements
and fund our capital expenditures, investments, acquisitions, dividend payments
and repurchases of our common stock. Based on past performance and current
expectations, we believe our sources of liquidity, including the available
capacity under our existing revolving credit facility and other financing
alternatives, will provide us the necessary capital to fund these transactions
and achieve our planned growth for the next 12 months and the foreseeable
future.

Sources of Liquidity

Long-Term Debt

2022 Credit Agreement

On March 1, 2022, we entered into a credit agreement (the "2022 Credit
Agreement") which provides for a senior unsecured term loan credit facility in
an aggregate principal amount of $1.0 billion (the "2022 Term Facility") and a
senior unsecured revolving credit facility in an aggregate principal amount of
$500.0 million (the "2022 Revolving Facility" and, together with the 2022 Term
Facility, the "2022 Credit Facilities"). The 2022 Term Facility matures on
March 1, 2025, and the 2022 Revolving Facility matures on March 1, 2027. The
2022 Revolving Facility allows for the availability of up to $100.0 million in
the form of letters of credit and up to $50.0 million in the form of swingline
loans. We may seek additional commitments under the 2022 Revolving Facility from
lenders or other financial institutions up to an aggregate principal amount of
$750.0 million.

On March 1, 2022, we borrowed $1.0 billion under the 2022 Term Facility and
$250.0 million of the available $500.0 million under the 2022 Revolving
Facility. We are required to pay a commitment fee on the daily unused amount of
the 2022 Revolving Facility using a pricing grid which was 0.125% as of May 31,
2022 and can fluctuate between 0.10% per annum and 0.25% per annum.

We used these borrowings, along with the net proceeds from the issuance of the
Senior Notes (as defined below) and cash on hand, to finance the consideration
for the CGS acquisition, to repay borrowings under the 2019 Credit Agreement and
to pay related transaction fees, costs and expenses.

During the third quarter of 2022, we incurred approximately $9.5 million in debt
issuance costs related to the 2022 Credit Facilities. We defer costs we incur to
issue debt, which are presented in the Consolidated Balance Sheets as a direct
deduction from the carrying amount of the related debt liability, and we
amortize these costs to Interest expense, net in the Consolidated Statements of
Income over the contractual term on a straight-line basis, which approximates
the effective interest method.

Loans under the 2022 Term Facility are subject to scheduled amortization
payments on the last day of each fiscal quarter, commencing with August 31, 2022
and ending on the last such day to occur prior to the maturity date. Each
amortization payment is equal to 1.25% of the original principal amount of the
2022 Term Facility. Any remaining outstanding principal will be repaid in full
on March 1, 2025, the maturity date of the 2022 Term Facility. The 2022 Credit
Facilities are not otherwise subject to any mandatory prepayments. We may
voluntarily prepay loans under the 2022 Credit Facilities at any time without
premium or penalty. Prepayments of the 2022 Term Facility shall be applied to
reduce the subsequent scheduled amortization payments in direct order of
maturity. During the third quarter of fiscal 2022, we repaid $125.0 million
under the 2022 Term Facility.

The 2022 Credit Agreement provides that loans denominated in U.S. dollars, at
our option, will bear interest at either (i) one-month Term SOFR (with a 10
basis points credit spread adjustment and subject to a "zero" floor), (ii) Daily
Simple SOFR (with a 10 basis points credit spread adjustment and subject to a
"zero" floor) or (iii) an alternate base rate. Under the 2022 Credit Agreement,
loans denominated in Pounds Sterling will bear interest at Daily Simple SONIA
(subject to a "zero" floor) and
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loans denominated in Euros will bear interest at EURIBOR (subject to a "zero"
floor), in each case, plus an applicable interest rate margin. The interest rate
margin will be based upon our senior unsecured non-credit enhanced long-term
debt rating and our total leverage ratio.

The outstanding borrowings under the 2022 Term Facility through the third quarter of fiscal 2022 bore interest at a rate equal to the applicable Term SOFR rate plus a spread using a debt leverage pricing grid currently at 1.1%.


The 2022 Credit Agreement contains usual and customary event of default
provisions for facilities of this type, which are subject to usual and customary
grace periods and materiality thresholds. If an event of default occurs under
the 2022 Credit Agreement, the lenders may, among other things, terminate their
commitments and declare all outstanding borrowings immediately due and payable.

Refer to Note 12, Debt for further discussion of the 2022 Credit Agreement.

Senior Notes


On March 1, 2022 we completed a public offering of $500.0 million aggregate
principal amount of 2.900% Senior Notes due March 1, 2027 (the "2027 Notes") and
$500.0 million aggregate principal amount of 3.450% Senior Notes due March 1,
2032 (the "2032 Notes" and, together with the 2027 Notes, the "Senior Notes").
The Senior Notes were issued pursuant to an indenture, dated as of March 1,
2022, by and between us and U.S. Bank Trust Company, National Association, as
trustee (the "Trustee"), as supplemented by the supplemental indenture, dated as
of March 1, 2022, between us and the Trustee (the "Supplemental Indenture").

The Senior Notes were issued at an aggregate discount of $2.8 million, and
during the third quarter of 2022, we incurred approximately $9.1 million in debt
issuance costs related to the Senior Notes. We deferred the debt discounts and
costs we incurred to issue debt, which are presented in the Consolidated Balance
Sheets as a net direct deduction from the carrying amount of the related debt
liability, and we amortize these costs to Interest expense, net in the
Consolidated Statements of Income over the contractual term leveraging the
effective interest method.

The 2027 Notes and the 2032 Notes will mature on March 1, 2027 and March 1, 2032, respectively. Interest on the Senior Notes is payable semiannually in arrears on March 1 and September 1 of each year, beginning September 1, 2022. We may redeem the Senior Notes, in whole or in part, at any time at specified redemption prices, plus accrued and unpaid interest, if any.

The Senior Notes are unsecured unsubordinated obligations and will be effectively subordinated to any of our existing and future secured obligations to the extent of the value of the assets securing such obligations.


Upon the occurrence of a change of control triggering event (as defined in the
Supplemental Indenture), we must offer to repurchase the Senior Notes at 101% of
their principal amount, plus accrued and unpaid interest, if any.

2022 Swap Agreement


On March 1, 2022, we entered into the 2022 Swap Agreement to hedge a portion of
our outstanding floating SOFR rate debt with a fixed interest rate of 1.162%.
Refer to Note 6, Derivative Instruments, for defined terms and more information
on the 2022 Swap Agreement.

2019 Credit Agreement


On March 29, 2019, we entered into a credit agreement with PNC Bank, National
Association ("PNC") (the "2019 Credit Agreement"), which provided for a $750.0
million revolving credit facility (the "2019 Revolving Credit Facility"). The
2019 Revolving Credit Facility allowed for borrowings until its maturity date of
March 29, 2024. The 2019 Credit Agreement also allowed for, subject to certain
requirements, additional borrowings with PNC for an aggregate amount up to
$500.0 million, provided that any such request for additional borrowings must be
in a minimum amount of $25.0 million.
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We borrowed $575.0 million of the available $750.0 million provided by the 2019
Revolving Credit Facility, resulting in $175.0 million that was available to be
borrowed. We were required to pay a commitment fee using a pricing grid based on
the daily amount by which the available balance in the 2019 Revolving Credit
Facility exceeded the borrowed amount. All outstanding loan amounts were
reported as Long-term debt within the Consolidated Balance Sheets.

Borrowings under the 2019 Revolving Credit Facility bore interest on the
outstanding principal amount at a rate equal to the daily LIBOR plus a spread
using a debt leverage pricing grid. Interest on the amounts outstanding under
the 2019 Revolving Credit Facility was payable quarterly, in arrears, and on the
maturity date.

During fiscal 2019, we incurred approximately $0.9 million in debt issuance
costs related to the 2019 Credit Agreement. These costs were capitalized as debt
issuance costs and were amortized into Interest expense, net in the Consolidated
Statements of Income ratably over the term of the 2019 Credit Agreement.

The 2019 Credit Agreement contained covenants and requirements restricting
certain of our activities, which were usual and customary for this type of loan.
In addition, the 2019 Credit Agreement required that we maintain a consolidated
net leverage ratio, as measured by total net funded debt/EBITDA (as defined in
the 2019 Credit Agreement), below a specified level as of the end of each fiscal
quarter.

As of March 1, 2022, we repaid in full and terminated the 2019 Credit Agreement. Refer to Note 12, Debt for more information on the termination.

Uses of Liquidity

Returning Value to Shareholders

For the nine months ended May 31, 2022, we returned $111.0 million to stockholders in the form of share repurchases and dividends. Over the last 12 months, we returned $234.2 million to stockholders in the form of share repurchases and dividends.

Share Repurchase Program

Under our share repurchase program, we may repurchase shares of our common stock from time to time in the open market and privately negotiated transactions, subject to market conditions.


Beginning in the second quarter of fiscal 2022, we suspended our share
repurchase program through at least the second half of fiscal 2023, with the
exception of potential minor repurchases to offset dilution from grants of
equity awards or repurchases to satisfy withholding tax obligations due upon the
vesting of stock-based awards. The suspension of our share repurchase program
allows us to prioritize the repayment of debt of the 2022 Credit Facilities.
Refer to Note 12, Debt for more information on the 2022 Credit Facilities.

As such, for the three months ended May 31, 2022, we did not make any
repurchases under our existing share repurchase program, compared to 178,100
shares repurchased for $57.6 million for the three months ended May 31, 2021.
During the nine months ended May 31, 2022, we repurchased 46,200 shares for
$18.6 million under our existing share repurchase program, compared with 531,859
shares for $172.2 million in the same period a year ago.

As of May 31, 2022, $181.3 million remained available under the share repurchase
program for future share repurchases. There is no defined number of shares to be
repurchased over a specified timeframe through the life of the share repurchase
program. It is expected that share repurchases will be paid using existing and
future cash generated by operations.

Capital Expenditures


For the nine months ended May 31, 2022, capital expenditures were $36.0 million,
compared with $47.4 million during the same period a year ago, a decrease of
$11.6 million. Capital expenditures decreased primarily due to costs incurred
for the build-out of our office space in the Philippines during the nine months
ended May 31, 2021, partially offset by higher expenditures related to the
development of capitalized internal-use software and peripherals for office
space primarily in India during the nine months ended May 31, 2022.

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Dividends


On April 28, 2022, our Board of Directors approved a regular quarterly dividend
of $0.89 per share. The increase of $0.07 per share, or 8.5%, in the amount of
our quarterly dividend marked the 23rd consecutive year we have increased
dividends, highlighting our continued commitment to returning value to our
shareholders. Dividends of $33.8 million were paid on June 16, 2022 to common
stockholders of record at the close of business on May 31, 2022. Future cash
dividends will depend on our earnings, capital requirements, financial condition
and other factors considered relevant by us and are subject to final
determination by our Board of Directors.

Acquisitions


During fiscal 2022 and 2021, we completed acquisitions of several businesses,
with the most significant cash flows related to the acquisitions of CGS, Cobalt
Software, Inc. ("Cobalt") and Truvalue Labs, Inc. ("TVL").

On March 1, 2022, we completed the acquisition of CGS, previously operated by
S&P Global Inc. on behalf of the American Bankers Association, for a cash
purchase price of $1.932 billion, inclusive of preliminary working capital
adjustments. CGS manages a database of 60 different data elements uniquely
identifying more than 50 million global financial instruments. CGS is the
exclusive provider of Committee on Uniform Security Identification Procedures
("CUSIP") and CUSIP International Number System ("CINS") identifiers globally
and also acts as the official numbering agency for International Securities
Identification Number ("ISIN") identifiers in the United States and as a
substitute number agency for more than 35 other countries. We anticipate that
the CGS acquisition will significantly expand our critical role in the global
capital markets.

On October 12, 2021, we acquired all of the outstanding shares of Cobalt for a
purchase price of $50.0 million, net of cash acquired. Cobalt is a leading
portfolio monitoring solutions provider for the private capital industry. This
acquisition advances our strategy to scale our data and workflow solutions
through targeted investments as part of our multi-year investment plan and
expands our private markets offering.

On November 2, 2020, we acquired all of the outstanding shares of TVL for a
purchase price of $41.9 million, net of cash acquired. TVL is a leading provider
of ESG information. TVL applies artificial intelligence driven technology to
over 100,000 unstructured text sources in multiple languages, including news,
trade journals, and non-governmental organizations and industry reports, to
provide daily signals that identify positive and negative ESG behavior. The
acquisition of TVL further enhances our commitment to providing industry leading
access to ESG data across our platforms.

Refer to Note 7, Acquisitions, for further discussion of the CGS, Cobalt and TVL acquisitions.


Contractual Obligations

Purchase obligations represent our legally-binding agreements to purchase fixed
or minimum quantities at determinable prices. Our purchase obligations consist
of two primary arrangements, data content and hosting services. We also have
contractual obligations related to our lease liabilities and outstanding debt.

The effect of our contractual obligations on our liquidity and capital resources
in future periods should incorporate the information described in Note 14,
Commitments and Contingencies in the Notes to the Consolidated Financial
Statements included in Part II, Item 8 in our Annual Report on Form 10-K for
fiscal year ended August 31, 2021, in conjunction with the factors mentioned
here.

As of August 31, 2021, we had total purchase commitments of $191.9 million.
During the second quarter of fiscal 2022, we entered into a software
subscription agreement with total purchase commitments of approximately $10
million with a contract term of three years. During the third quarter of fiscal
2022, we entered into a cloud hosting contract with a total purchase commitments
of approximately $$275.0 million with a contract term of six years. This cloud
hosting contract replaced a previous contract which was included in the
August 31, 2021 balance with a minimum purchase commitment of $125.0 million.
Refer to Note 11, Leases and Note 12, Debt for information regarding lease
commitments and outstanding debt obligations, respectively.
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