Paylocity Holding Corporation (NASDAQ:PCTY) Q2 2023 Results Conference Call February 2, 2023 5:30 PM ET Company Participants Ryan Glenn - CFO Steve Beauchamp - Co-CEO Toby Williams - President, Co-CEO Conference Call Participants Alex Zukin - Wolfe Research Alex Sklar - Raymond James Arvind Ramnani - Piper Sandler Brad Reback - Stifel Daniel Jester - BMO Jared Levine - Cowen Jason Celino - KeyBanc Mark Marcon - Baird Matt Pfau - William Blair Robert Simmons - D.A. Davidson Samad Samana - Jefferies Scott Ber ...

Financial Data and Key Metrics Changes - Total revenue for Q1 2023 was $253.3 million, representing a 39.4% increase year-over-year, exceeding guidance by $12 million [9][21] - Recurring revenue grew by 35.7% compared to the same period last year [9][21] - Adjusted gross profit margin improved to 72.1% from 70.5% year-over-year, reflecting 160 basis points of leverage [22] - Adjusted EBITDA for Q1 was $66.6 million, a margin of 26.3%, exceeding guidance by $8.6 million [25] - Cash and cash equivalents at the end of the quarter were $65.5 million with no debt outstanding [26] Business Line Data and Key Metrics Changes - Strong sales momentum was noted across all markets, with significant growth in product utilization metrics, particularly in community engagement and video content [16][17] - New product enhancements were highlighted, including tools for employee engagement and data insights, which contributed to operational improvements for clients [11][13] Market Data and Key Metrics Changes - The average daily balance of client funds was $2.1 billion in Q1, with expectations of $2.2 billion in Q2 [27] - Interest income on client funds is expected to rise due to sustained interest rate increases, with an estimated average yield of approximately 170 basis points in Q2 [27] Company Strategy and Development Direction - The company plans to reinvest a portion of increased interest income into key areas such as people, product, and marketing to drive future growth [17] - Continued focus on digital marketing and channel initiatives, which contributed over 25% of new business in Q1 [17] - The company aims to enhance its mobile capabilities and ensure that all new developments are mobile-friendly [47] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the resilience of their client base despite macroeconomic uncertainties, noting no significant slowdown in demand [36][56] - The company is committed to maintaining investments in sales and marketing, even in the face of potential economic downturns, as these are seen as critical for long-term growth [91] Other Important Information - The company received multiple workplace certifications, including Great Places to Work certification for 2022 [19] - The Elevate Client Conference hosted a record 4,000 attendees, emphasizing the importance of connected HR solutions [10][14] Q&A Session Summary Question: How should we think about the strength in the business? - Management attributed the strong performance to effective sales execution and an increase in average revenue per customer due to new products and upmarket initiatives [33][34] Question: Are there any specifics around geographies or verticals? - Management noted that client growth has been consistent across various industries, with no significant changes observed [40] Question: What is the strategic rationale behind the credit facility? - The credit facility was upsized to reflect the growth and scale of the business, maintaining the same strategic rationale as before [42] Question: How much of the revenue growth is attributed to Blue Marble? - Blue Marble contributed less than 2% of revenue, with ongoing integration efforts continuing [78][96] Question: How is inflation impacting the business? - Inflation may affect client employee counts, impacting revenue, but increased interest rates provide a hedge against this [98]

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549 ________________________________________________________________________ Form 10-Q ________________________________________________________________________ x Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the quarterly period ended September 30, 2022 o Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the transition period from to Com ...

Paylocity Holding Corporation (NASDAQ:PCTY) Q4 2022 Earnings Conference Call August 4, 2022 5:30 PM ET Company Participants Ryan Glenn – Chief Financial Officer Steve Beauchamp – Co-Chief Executive Officer Toby Williams – President and Co-Chief Executive Officer Conference Call Participants Scott Berg – Needham & Company Brad Reback – Stifel Terry Tillman – Truist Bryan Bergin – Cowen Mark Marcon – Baird Samad Samana – Jefferies Alex Zukin – Wolfe Research Chase Donovan – Raymond James Robert Simmons – D.A. ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 __________________________________________________ FORM 10-K __________________________________________________ x ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended June 30, 2022 OR o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Transition Period from to Commission File Number 001-36348 ______________________ ...

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Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549 ________________________________________________________________________ Form 10-Q ________________________________________________________________________ x Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the quarterly period ended March 31, 2022 o Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the transition period from to Commiss ...

Paylocity Holding Corporation (NASDAQ:PCTY) Q3 2022 Results Conference Call May 5, 2022 5:30 PM ET Company Participants Ryan Glenn - Chief Financial Officer Steve Beauchamp - Chief Executive Officer Toby Williams - Co-Chief Financial Officer Conference Call Participants Scott Berg - Needham Brian Peterson - Raymond James Bryan Bergin - Cowen Robert Dee - Truist Brad Reback - Stifel Matt Pfau - William Blair Ryan Krieger - Wolfe Research Kevin McVeigh - Credit Suisse Lucky Schreiner - D.A. Davidson Mark Marc ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549 ________________________________________________________________________ Form 10-Q ________________________________________________________________________ x Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the quarterly period ended December 31, 2021 o Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the transition period from to Comm ...

Financial Data and Key Metrics Changes - Total revenue for Q2 was $196 million, representing a 34% increase compared to the same period last year, exceeding guidance by $6.5 million [11][20] - Adjusted EBITDA for the quarter was $46.6 million, with a margin of 23.8%, surpassing guidance by $4.6 million [12][24] - Gross profit for Q2 was $125.2 million, with operating income at $8.1 million and net income at $9.9 million [24] Business Line Data and Key Metrics Changes - Recurring and other revenues increased by 34.1% year-over-year [20] - Investment in R&D rose by 21.6% year-over-year, reflecting a commitment to enhancing the Paylocity platform [21] - Sales and marketing expenses were 23.7% of revenue, while G&A costs were 13.1% of revenue, showing a slight improvement from the previous year [23] Market Data and Key Metrics Changes - The average daily balance of client funds was $1.8 billion in Q2, expected to rise to approximately $2.2 billion in Q3 [26] - The company anticipates an average yield of 5 to 10 basis points for Q3 [26] Company Strategy and Development Direction - The company is raising its target market segment from clients with over 1,000 employees to those with up to 5,000 employees, indicating a strategic shift to capture larger clients [18] - The acquisition of Cloudsnap aims to enhance integration capabilities, supporting the strategy of automating data exchange between critical systems [15][17] - Continued investment in R&D and product development is seen as crucial for maintaining competitiveness in the market [13][21] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the strong sales momentum and the ability to maintain growth, citing a return to pre-COVID activity levels [57][90] - The demand for human capital management solutions is increasing, driven by challenges in attracting and retaining talent [90][91] - The company maintains a long-term growth target of over 20%, despite recent strong performance [47][48] Other Important Information - The company ended the quarter with cash and cash equivalents of $84.1 million and drew down $50 million from its revolving credit facility for the Cloudsnap acquisition [25] - The guidance for Q3 revenue is expected to be between $239 million and $243 million, reflecting approximately 30% growth year-over-year [28] Q&A Session Summary Question: How prepared is the company for moving upmarket? - Management indicated that the move upmarket has occurred naturally over time, with a significant number of clients already in the 1,000+ employee segment [35][36] Question: What is the retention rate for engaged customers? - Early signs suggest that higher engagement with modern workforce products correlates with better retention rates, although quantifiable data is still being gathered [38] Question: How is customer feedback on new tools? - New tools like the COVID tracker and diversity tools are well-received and provide differentiation, although they are included in the platform at no additional cost [42] Question: What are the biggest factors affecting EBITDA margins? - Management reiterated a commitment to achieving 30% to 35% EBITDA margins over time, with scale and revenue growth being key drivers [43][44] Question: How is the company addressing the competitive landscape? - The company focuses on modernizing employee engagement tools, which resonate well with clients looking to attract and retain talent [83][84] Question: What is the impact of rising interest rates on the business? - Rising interest rates are expected to provide a tailwind for revenue and profitability, although the timing and magnitude of these effects remain uncertain [85][86]