Alight, Inc. · NYSE:ALIT
Alight — Investor Presentation (August 2022)
27 slides from Alight's investor presentation, Aug 3, 2022
Slide 1: Powering confident decisions, for life.
Powering confident decisions, for life. Alight, Inc. August 2022 Investor Presentation August 3, 2022
Slide 2: Disclaimer
Disclaimer Forward-looking statements Financial statement presentation This presentation contains forward-looking statements within the meaning of Section 27A of the This presentation includes certain historical consolidated financial and other data for Alight Holding Securities Act of 1933, as amen
Slide 3: Table of contents
Table of contents ABOUT OUR MISSION OUR OUR ALIGHT MARKET SOLUTIONS MARKET pg 4 pg 6 pg 8 pg 11 CLIENT DEMO + TECH FINANCIAL APPENDIX RESULTS ROADMAP PROFILE pg 12 pg 14 pg 18 pg 25 Alight is a leading cloud-based human capital technology and services provider that powers confident health, wealth an
Slide 4: We are Alight
⇠ TOC ABOUT ALIGHT We are Alight Health Wealth PURPOSE Benefits administration Defined contribution Benefits guidance Defined benefit Powering confident decisions, Reimbursement accounts Financial wellbeing for life. Eligibility and compliance Payroll Wellbeing VALUES Global payroll Wellbeing Champi
Slide 5: Serving global clients of all sizes across diverse industries
⇠ TOC ABOUT ALIGHT Serving global clients of all sizes across a diverse set of industries 36 million ~4,300 clients people and dependents1 15 years average client tenure2 13% 21% $2.9 billion $621 million 2021 revenue 2021 adjusted EBITDA 13% 97% 84% avg. revenue retention3 annual recurring revenue4
Slide 6: Alight is solving today's pressing challenges for organizations and their people
⇠ TOC OUR MISSION Alight is solving today’s pressing challenges for organizations and their people People are struggling 50% 60% 44% 64% and employee wellbeing and engagement are at regret a can’t retire when perceive their overall wellbeing are looking all-time lows healthcare decision1 they want1
Slide 7: The current fragmented human capital management ecosystem isn't working
⇠ TOC OUR MISSION The current fragmented human capital management ecosystem1 isn’t working Colleague recommendations HR Rx Cigna Buoy QDRO Health YSA Dental Pet Benefits information carrier Insurance Employees are overwhelmed by too much Life insurance Group Auto/ information, too many sources and P
Slide 8: Alight's platform solution provides integrated, personalized access to content and delivery
⇠ TOC OUR SOLUTIONS Alight’s platform solution provides integrated, personalized access to unparalleled content and delivery capabilities Alight Worklife engagement platform delivers content cloud solutions Alight Worklife® supported by services: Enterprise-wide engagement platform Integrated user e
Slide 9: Leveraging data and AI, Alight Worklife drives engagement and program utilization
⇠ TOC OUR SOLUTIONS Leveraging data and AI, Alight Worklife drives engagement and program utilization resulting in improved outcomes for employees and employers Integrated access Personalized experience Optimized outcomes One front door AI-based Benchmark and for health, wealth, recommendations iden
Slide 10: Alight is the only integrated offer within a fragmented market
⇠ TOC OUR SOLUTIONS Alight is the only integrated offer within a fragmented market There is no direct competitor with most companies largely focused on just one silo. Alight is differentiated by: 1) Ability to serve the size and complexity of Fortune 100 companies; 2) combination of technology and s
Slide 11: New content is driving an increase in Alight's total addressable market
⇠ TOC OUR MARKET The addition of new content leveraging our platform strategy is driving an increase in Alight’s total addressable market 2022 TAM1 Alight’s 2021 revenue represents ~4% share of fragmented market Investments $73 2017 TAM Thrift Alight Partner billion Network Optimize Hype $33 billion
Slide 12: Clients are transforming their relationship with employees and gaining ROI
⇠ TOC OUR RESULTS Clients are transforming their relationship with their employees + gaining ROI as they move from custom and complex to this platform-driven, optimized solution Powered by After implementing At a large retailer, For a large A consumer goods For an energy Alight Worklife, AI-based 16
Slide 13: New clients choosing Alight for savings, retention and wellbeing utilization
⇠ TOC OUR RESULTS New clients are choosing Alight to deliver increased healthcare savings, employee retention and wellbeing utilization RETURN ON INVESTMENT Alight to provide integrated Healthcare savings as a percentage of fees solutions from pre-hire to retire for a new client in the VALUE ON INVE
Slide 14: Alight Worklife: moving to a platform approach has increased pace of innovation
⇠ TOC TECH ROADMAP Alight Worklife — Moving to a platform approach has increased pace of innovation MOBILE UPDATES Mobile U2 2022: Mobile acceleration Mobile U3 2022: Expanding everyday use — Hype AI notifications — Chatbot updates — Program optimization experience — To-do’s integration — Clinical g
Slide 15: Program optimization is an example of new content in 2022 R2
⇠ TOC TECH ROADMAP Program optimization is one example of the 2022 R2 new content added in the second release in 2022 A value framework Improving access, driving Measuring outcomes and for wellbeing awareness and engagement identifying opportunities There is an abundance of research that ties each m
Slide 16: Alight Worklife third release (2023 R1) will focus on wellbeing
⇠ TOC TECH ROADMAP Alight Worklife third release (“2023 R1”) will focus on wellbeing 2023 R1 Alight wellbeing A fully integrated Alight wellbeing experience driving year-round engagement and greater wellbeing for a healthy mind, body, wallet and life Alight marketplace Support total wellbeing throug
Slide 17: 2023 R1 will finalize status tracking capabilities to address call costs
⇠ TOC TECH ROADMAP 2023 R1 will also have finalized the status tracking capabilities, which 2023 R1 could address the $40 million in costs associated with calls received Designed to reduce customer effort and call volume-related processes 4.4 CHALLENGE million status calls in 2021 — Status inquiry c
Slide 18: Multiple levers to drive top-line growth
⇠ TOC FINANCIAL PROFILE Multiple levers to drive top-line growth... One Alight New logos M&A ~$1.3 billion ~$73 billion ~$40 billion Average uplift of 1.5x annual recurring Total addressable market of over Proven track record of disciplined M&A and revenue on bundled health BPaaS deals1 $73 billion2
Slide 19: One Alight BPaaS deals driving improved margin
⇠ TOC FINANCIAL PROFILE …with One Alight BPaaS deals driving improved margin BPaaS expands share of wallet + higher profitability Representative products STAND-ALONE SOLUTIONS Health benefits admin with SmartBen Healthcare navigation Hyper personalization 1 2 3 Global payroll leveraging HrX Higher r
Slide 20: BPaaS offering increases share of wallet and higher margins
⇠ TOC FINANCIAL PROFILE BPaaS offering increases share of wallet and higher margins REPRESENTATIVE DEALS Stand-alone benefit administration deals BPaaS deals STANDALONE # OF DEAL BUNDLED # OF TOTAL ARR PRODUCTS MARGIN ARR PRODUCTS DEAL MARGIN Client 1 $4.8 million 1 22.7% $12.5 million 9 37.1% STAND
Slide 21: Growing cash flow profile
⇠ TOC FINANCIAL PROFILE Growing cash flow profile 60-80% Capital Expenditures 40-50% Target ~4% of revenue per annum2 Operating FUTURE TARGET Spend has shifted to Cash Flow 1 conversion 19% Working capital improvements growth investment Return on investments flowing (~60%) from through maintenance 2
Slide 22: Capital allocation framework
⇠ TOC FINANCIAL PROFILE Capital allocation framework A strong balance sheet to Optimize the Distribute excess execute strategic priorities capital structure cash to shareholders Re-invest in business and pursue M&A to create value and Maintain 3 – 4x (net debt to Stock repurchases generate growth EB
Slide 23: Resilient business model in challenging macroeconomic environment
⇠ TOC FINANCIAL PROFILE Resilient business model in challenging macroeconomic environment Demonstrated stability with 83% Recurring Revenue and 97% Average Revenue Retention PANDEMIC EXPERIENCE (in millions) Higher unemployment level potential impact is muted by: $600 14.0% 1. Health participants wi
Slide 24: Alight provides mission-critical solutions that keep people healthy and financially secure
⇠ TOC FINANCIAL PROFILE Alight provides mission-critical solutions that keep people healthy and financially secure Business snapshot — 2021 Strong recurring revenue growth (7.6% CAGR over last 5 years) Employer Solutions Professional Services 2017 - $1.6 billion 2021 - $2.4 billion (87% of Revenue)
Slide 25: Additional technology detail and non-GAAP reconciliations
⇠ TOC APPENDIX Additional technology detail and non-GAAP reconciliations 25
Slide 26: Alight Worklife provides an omnichannel customer experience
⇠ TOC APPENDIX The Alight Worklife platform provides an omnichannel customer experience leveraging our AI and analytics layer and transaction engines to drive a personalized approach for customers Analytics and AI — Visibility into multiple information sources Customer experience — Personalized and
Slide 27: Adjusted 2021 EBITDA
⇠ TOC APPENDIX Adjusted 2021 EBITDA 27