Good morning. My name is Audra, and I will be your conference operator today. At this time, I would like to welcome everyone to the Donnelly Financial Solutions 4th Quarter Earnings Conference Call. Today's conference is being recorded. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during this time, simply press the star key followed by the number 1 on your telephone keypad. If you would like to withdraw your question, press star 1 again. At this time, I would like to turn the conference over to Mike Zhao, Head of Investor Relations. Please go ahead.

Good morning, everyone, and thank you for joining Donnelly Financial Solutions' fourth quarter and full year 2024 results conference call. This morning, we released our earnings report, including a set of supplemental trending schedules of historical results, copies of which can be found in the Investors section of our website at DFINsolutions.com. During this call, we'll refer to forward-looking statements that are subject to risks and uncertainties. For complete discussion, please refer to the cautionary statements included in our earnings release and further details in our most recent annual report on Form 10-K and other filings with the SEC. Further, we will discuss certain non-GAAP financial information, such as consolidated adjusted EBITDA, consolidated adjusted EBITDA margin, and organic net sales. We believe the presentation of non-GAAP financial information provides you with useful supplementary information concerning the company's ongoing operations and is an appropriate way for you to evaluate the company's performance. They are, however, provided for informational purposes only. please refer to the earnings release and related tables for GAAP financial information and reconciliations of GAAP to non-GAAP financial information. I am joined this morning by Dan Lieb, Dave Gardella, and other members of management. I will now turn the call over to Dan.

Thank you, Mike, and good morning, everyone. Our fourth quarter results offered further validation of our strategy, including an improved sales mix, solid growth in software Solutions net sales driven by double-digit increases in our SaaS compliance offerings and great progress in expanding the adoption of our offerings in the marketplace. Offsetting the growth in Software Solutions, our fourth quarter event-driven transactional revenue was down approximately $20 million, or 33%, compared to the fourth quarter of last year. In addition, as we previously communicated, we faced robust sales comparisons year-over-year in venue. Dave will cover the fourth quarter results in more detail shortly. Reflecting on the full year of 2024, the disciplined execution of our strategy delivered strong financial and operational results, including software solutions organic net sales growth of 13.8%, growth in adjusted EBITDA, adjusted EBITDA margin expansion, and improvements in both operating cash flow and free cash flow compared to full year 2023, despite a reduction in our event-driven transactional revenue for the third consecutive year. Following declines in capital markets transactional revenue in 2022 and 2023, deal activity remained muted in 2024, resulting in a revenue reduction of approximately $9 million, or 5%. Combined with lower event-driven transactional revenue in our investment company segment, our total event-driven revenue was down approximately $15 million, or 8%, compared to full year 2023. For perspective, the level of event-driven revenue we recorded in 2024, $186.5 million, was the lowest annual level and more than $100 million below the average annual event-driven revenue we've achieved in our history as a standalone company. While we have retained our strong share position, the level of overall transactional market activity remained depressed throughout 2024. Despite this prolonged headwind, our strong execution enabled us to deliver consolidated adjusted EBITDA of $217.3 million, an increase of $9.9 million, or 4.8 percent, year-over-year, and consolidated adjusted EBITDA margin of 27.8 percent, approximately 180 basis points higher compared to 2023. We remain on track to deliver our long-term goal of achieving adjusted EBITDA margin of 30% plus by 2028. Our continued strong performance through an extended weak transactions market is an important accomplishment that demonstrates the underlying strength of our business and is a proof point for our broader strategy. One of the fundamental drivers of our strong margin performance has been delivering higher value to clients through our higher margin software offerings. Our 2024 performance further demonstrated the progress of our strategy. For full year 2024, we delivered record software solutions net sales of approximately $330 million, an increase of 13.8% from 2023 on an organic basis, resulting in software solutions comprising approximately 42% of our total full year net sales in addition to the strong growth our software solutions performance in 2024 helped us reach two important milestones first in may of 2020 we introduced our 44 and 24 strategy specifically targeting to double our sales mix derived from software solutions over five years moving from 22 percent of net sales from software solutions in 2019 to 44% in 2024, and more importantly, benefiting from the resulting financial profile from such a business mix. From the time we committed to that aspirational target, we focused our efforts to accelerate the development and go-to-market velocities of our software solutions, including launching new products such as New Active Disclosure, ARK Digital, Total Compliance Management, and the Tailored Shareholder Reports module within ARK Reporting, increasing go-to- market investments and expanding our partner ecosystem, while divesting non-strategic software assets that could not deliver an appropriate financial return. At the same time, we maintained a strong tech-enabled services offering and successfully managed the decline in print and distribution net sales, which was impacted by regulatory-driven reductions, the secular decline in the demand for printed materials, and our proactive decision to exit some lower-margin work. We finished the year with software solutions net sales representing 42.2% of our total net sales, a bit short of the 44% goal, in part due to the divestiture of non-strategic software products. However, we are realizing the financial profile benefits associated with a significantly improved sales mix. This achievement is a significant proof point of our transformation and keeps us on the right path to achieve our long-term financial goals. Second, for the first time in the company's history, full-year net sales from software solutions exceeded net sales from each of tech-enabled services and print and distribution, becoming the largest component of our overall net sales. This offers another proof point that DFIN is delivering excellent solutions to our clients, which in turn positions us to continue to deliver strong returns to our shareholders. Since becoming a standalone company in 2016, we've grown our annual software solutions net sales by nearly $200 million, from $136 million to $330 million, representing an annualized growth rate of approximately 12% or approximately 13% on an organic basis. Let me share a few highlights that underpin the growth in our software solutions in 2024 and the momentum we are carrying into 2025. First, Venue, our virtual data room offering, delivered outstanding results in 2024, growing approximately 26% year over year and reaching a record level of revenue of nearly $140 million. dollars. Performance was driven by our strong sales execution, which resulted in several large projects, pricing improvements, and increased room and page volume. Next, we are encouraged by the sales momentum in our recurring compliance products, Active Disclosure and ArcSuite. Having posted moderate growth during the first three quarters of the year, the growth and aggregate of Active Disclosure and ArcSuite accelerated in the fourth quarter and increased approximately 19% compared to last year's fourth quarter. The improvement in trend creates positive momentum heading into 2025. For active disclosure, 2024 represented the first full year of operating on the new AD platform, which was a new build released in the first quarter of 2021. Since completing the decommission of the former AD product in the first half of 2023, we've realized improved operating performance, including growth in net client count, as well as higher subscription value per client. In addition, our sales execution, coupled with recent product enhancement, have also resulted in sequential improvements in revenue retention rates. The improvements we have made across the offering, from technology, services, support, and sales, create a strong foundation for sustained future growth we expect active disclosure to continue to deliver solid growth in 2025 as it relates to arc suite we delivered solid full year net sales growth of approximately nine percent in part from the tailored shareholder reports regulation for which we generated approximately six million dollars of software revenue in line with our expectations we remain on track to achieve 11 million to 12 million dollars of recurring software revenue on a full-year basis. In addition, during the fourth quarter, we closed on a large multi-year renewal of a software subscription contract with a strategic ARC suite client, further improving the predictability of our future revenue. Before turning it over to Dave, I wanted to provide a quick update on our strategic priorities for this year. In 2025, you can expect our primary focus to remain on accelerating our business mix shift by continuing to grow our recurring SaaS revenue base while maintaining share in our core traditional businesses, including transactions. We are encouraged by the momentum and active disclosure in ARC Suite heading into the year and expect Venue to continue to perform well in 2025, despite facing tougher year-over-year comparisons, particularly in the first half of the year. We will continue to invest in our regulatory and compliance software platform to ready ourselves to capture the demand from future new regulations and non-SEC use cases. In addition, we will continue to aggressively manage our costs and drive operational efficiencies, including taking additional actions to better align our cost structure with our current level of sales. Finally, we will maintain our disciplined approach to investments and capital allocation in our pursuit of profitable growth opportunities to maximize financial return and create long-term value. I'm confident with our continued focus on executing our strategy, we will create increased value for our clients, employees, and shareholders. Before I share a few closing remarks, I would like to turn the call over to Dave to provide more details on our fourth quarter financial results and outlook for the first quarter of 2025. Dave?

Thank you, Dan, and good morning, everyone. As Dan noted, we continued to deliver solid growth in our software solutions offerings during the quarter, which grew 11.6% on an organic basis, the fourth consecutive quarter of double-digit organic software solutions net sales growth. The fourth quarter capped off outstanding full-year 2024 performance, during which Software Solutions net sales increased 13.8% on an organic basis, the highest year-over-year growth rate we've achieved in the last three years. We are encouraged by the accelerating growth of our compliance software offerings, Active Disclosure and ArcSuite, with each product generating double-digit growth during the quarter, an improvement compared to recent trend. Our software performance enabled us to deliver another quarter of improved sales mix and solid adjusted EBITDA margin performance, despite lower-than-expected transactional revenue. On a consolidated basis, total net sales for the fourth quarter of 2024 were $156.3 million, a decrease of $20.2 million, or 11.4% from the fourth quarter of 2023. The decrease in consolidated net sales was driven by lower volume in our compliance and communications management segments, which decreased by $28.1 million in aggregate, with event-driven transactional revenue accounting for approximately $20 million of the year-over-year decline, related to both lower revenue from capital markets transactions as well as lapping a large mutual fund special proxy project in investment companies from last year's fourth quarter. Partially offset by the growth in software solutions net sales, which increased by $7.9 million or 11.6% on an organic basis. Fourth quarter adjusted non-GAAP gross margin was 59.9%, approximately 10 basis points higher than the fourth quarter of 2023, as the favorable impacts of higher software solutions net sales, ongoing cost control initiatives, and price uplifts were mostly offset by lower event-driven transactional activity. adjusted non-GAAP SG&A expense in the quarter was 62.1 million dollars a 2.1 million dollar decrease from the fourth quarter of 2023 as a percentage of net sales adjusted non-GAAP SG&A was 39.7 percent an increase of approximately 330 basis points from the fourth quarter of 2023 The decrease in adjusted non-GAAP SQ&A was primarily driven by reduction in selling expense as a result of lower transactional sales and the impact of ongoing cost control initiatives, partially offset by higher BAD-BAD expense. Our fourth-quarter adjusted EBITDA was $31.7 million, a decrease of $9.6 million from the fourth quarter of 2023. Fourth quarter adjusted EBITDA margin was 20.3%, a decrease of approximately 310 basis points from the fourth quarter of 2023. The declines in adjusted EBITDA and adjusted EBITDA margin were primarily driven by lower transactional revenue, partially offset by higher software solutions net sales, and the impact of ongoing cost control initiatives. Turning now to our fourth quarter segment results net sales in our capital market software solution segment were 50 million dollars an increase of 5.7 percent on an organic basis from the fourth quarter of last year driven by the performance of our recurring compliance product active disclosure which increased approximately 12 percent in the fourth quarter fourth quarter subscription revenue increased 6% year-over-year, in line with the growth rate from the third quarter, and once again, stronger than the growth we recorded in the first half of 2024. In addition, we continue to make great progress to increase the adoption of active disclosure service packages, and offering that bundles commonly used services into tiered packages which previously were offered on an ad hoc basis. The contracted service packages create a more predictable experience for our clients and a more predictable mix of recurring revenue for DFIN. Venue sales were up $0.7 million or approximately 2% year over year. As expected, venue sales growth was more modest in the fourth quarter compared to recent trend as we lapped a very strong fourth quarter of 2023 during which venue grew approximately 26 percent year over year in addition the impact from large projects which aided venue's robust growth through the first three quarters of this year was less significant during the fourth quarter on a full year basis venue delivered approximately $138 million in net sales and grew approximately 26% versus full year 2023. Adjusted EBITDA margin for the segment was 26.6%, an increase of approximately 10 basis points from the fourth quarter of 2023, primarily due to higher net sales and cost control initiatives, partially offset by higher selling expenses as a result of increased net sales. Net sales in our capital markets compliance and communications management segment were $53.3 million, a decrease of $15 million or 22% from the fourth quarter of 2023, primarily driven by lower event-driven transactional revenue. During the fourth quarter, we recorded $37.7 million in transactional revenue, which was approximately $10 million below our expectations and down nearly $12 million, or approximately 24%, from the fourth quarter of 2023. From a market perspective, the equity deal environment showed some signs of improvement in the fourth quarter, including increases in the number of priced IPOs and completed public company M&A deals in the U.S. compared to the fourth quarter of 2023. Consistent with our historical track record, we continued to maintain high market share for large, high-quality IPO and M&A transactions completed in the quarter. However, despite an increase in deal activity, we recorded lower revenue on a year-over-year basis, primarily due to three factors. First, while our revenue for priced IPOs increased, market activity for secondary and other follow-on offerings declined. Second, we recorded lower revenue from D-SPAC transactions as we deprioritized certain lower-quality deals, including D-SPACs with depleted trust due to redemptions and lack of financing, which can create future collections risk. Third, transactional revenue in the Asia-Pacific region declined year-over-year, driven by limited market activity and a proactive decision not to pursue certain low-margin work. As it relates to our approach on low-quality and low-margin opportunities, we will maintain the same level of discipline going forward. Capital markets compliance revenue was down $3.2 million, or 17.1% year-over-year, driven by a lower volume of compliance work, including certain event-driven filings such as 8K and special proxies associated with corporate transactions, as well as the related printing and distribution, consistent with the trend from the first three quarters of the year. Adjusted EBITDA margin for the segment was 25.5%, a decrease of approximately 520 basis points from the fourth quarter of 2023. The decrease in adjusted EBITDA margin was primarily due to lower transactional revenue, partially offset by cost control initiatives. Net sales in our investment company software solution segment were $31.6 million, an increase of $5.9 million, or 23% versus the fourth quarter of 2023, driven in part by revenue from our tailored shareholder report solution. In addition, as Dan noted earlier, during the fourth quarter, we closed on a large multi-year renewal of a software subscription contract with a strategic ARC Suite client. The renewal became effective in the fourth quarter and will continue to facilitate improved economics over the renewal term. On a full-year basis, total ARC Suite delivered approximately $116 million in revenue and grew 8.7% year-over-year, driven by growth in subscription revenue, including the impact of the Tailored Shareholder Report solution. Based on the incremental revenue from Tailored Shareholder Reports, we expect stronger ARC Suite revenue growth to continue in the first half of 2025. Adjusted EBITDA margin for the segment was 37%, an increase of approximately 550 basis points from the fourth quarter of 2023. The increase in adjusted EBITDA margin was primarily due to operating leverage on the increase in net sales and price uplifts partially offset by higher service-related costs associated with the ramp-up of the tailored shareholder reports offering. Net sales in our investment company's compliance and communications management segment were $21.4 million, a decrease of $13.1 million, or 38% from the fourth quarter of 2023, driven by lower print and distribution revenue, which accounted for substantially all of the year-over-year sales decline. the reduction in print and distribution revenue is a result of lapping a large mutual fund special proxy project in the fourth quarter of 2023 and the impact of the tailored shareholder reports regulation which lowered the demand for printed materials similar to what we experienced in the third quarter adjusted EBITDA margin for the segment was 22.4 percent a decrease of approximately 770 basis points from the fourth quarter of 2023 the decrease in adjusted EBITDA margin was primarily due to lower sales and an unfavorable sales mix partially offset by lower selling expenses as a result of lower sales. Non-GAAP unallocated corporate expenses were $11.7 million in the quarter, an increase of $0.8 million from the fourth quarter of 2023, primarily driven by higher incentive compensation expenses, partially offset by lower third-party expenses. Free cash flow in the quarter was $41.3 million, and full-year free cash flow was $105.2 million, an increase of $43 million over full-year 2023. The improvement in full-year free cash flow was primarily due to the flow-through of higher adjusted EBITDA and favorable working capital, partially offset by additional capital expenditures. We ended the year with $124.7 million of total debt and $67.4 million of non-GAAP net debt. At year-end 2024, we had no outstanding borrowings under our revolver and had $57.3 million of cash on hand. As of December 31, 2024, our non-GAAP net leverage ratio was 0.3 times. Regarding capital deployment, we repurchased approximately 282,000 shares of common stock during the fourth quarter for $17.4 million at an average price of $61.67 per share. For full year 2024, we repurchased approximately 947,000 shares for $58.7 million at an average price of $61.97 per share. Going forward, we will continue to take a balanced approach toward capital deployment. We continue to view organic investments to drive our transformation, share repurchases, and net debt reduction, each as key components of our capital deployment strategy, and we will remain disciplined in this area. As it relates to our outlook for the first quarter of 2025, we are encouraged by the improving transactional pipeline so far in the first quarter, though overall transactional activity remains well below the historical average. In the near term, we expect macroeconomic headwinds, market volatility, and geopolitical factors to continue to weigh on the return to a more normalized level of deal activity. In addition, we expect a continued decline in print and distribution sales, which will impact our traditional compliance offerings consistent with the recent trend. We remain bullish on the growth trajectory of our recurring compliance software offerings, Active Disclosure, and ArcSuite. Further, Venue is expected to face tough comparisons through the first half of the year, driven in part by lapping the large projects which benefited Venue sales last year. With that as the backdrop, we expect consolidated first quarter net sales in the range of $190 million to $200 million and consolidated adjusted EBITDA margin in the mid-20% range. Compared to the first quarter of last year, the midpoint of our consolidated revenue guidance, $195 million, implies a decrease of approximately 4% as growth in software solutions is more than offset by the continued decline in print and distribution volume and lower capital markets transactional activity. I'll also provide a bit more color on our assumptions for the capital markets transactional sales. At the midpoint of our sales range, we assume transactional sales of approximately $45 million in the first quarter, reflecting a decrease of approximately $3 million from the first quarter of 2024 and a sequential increase from the $37.7 million we recorded in the fourth quarter of 2024. As it relates to the full year, our 2025 operating plan reflects the continued execution of our strategy and associated investments aimed toward accelerating our transformation our capital spending which is predominantly related to development in our software products and the underlying technology to support them is projected to be between 65 million dollars and 70 million dollars this capex support the continued development of our regulatory and compliance software platform, including advancing toward our single compliance platform, in addition to developing solutions targeted for new regulations and incremental use cases. With that, I'll now pass it back to Dan.

Thanks, Dave. Our performance in 2024 serves as further proof point that our strategic transformation is enabling DFIN to become more profitable, focused, and resilient. We executed well in a very challenging market environment, delivering solid financial results while also continuing to invest in and execute our strategic transformation. Before we open it up for Q&A, I'd like to thank the DFIN employees around the world who ensure our clients continue to receive the highest quality solutions. Now with that, we're ready for questions.

Thank you. We will now begin the question and answer session. If you have dialed in and would like to ask a question, please press star 1 on your telephone keypad to raise your hand and join the queue. If you would like to withdraw your question, simply press star 1 again. We'll take our first question from Charles Strausser at CJS Securities.

Hi, good morning. Just a couple of questions. If we could talk about more color on results versus guidance and what were some of the key drivers behind the differential?

Yeah, Charlie, it's Dave. I'll take that one. Thanks for the question. So from a revenue perspective, the biggest variance, as we talked about, was the capital markets transactional revenue, which was off $10 million from what we had assumed in our guidance. You know, I think from an EBITDA margin perspective as well, you know, we came in at just north of 20%. Our guidance was for the low 20s. I think when you look at the variance in that transactional revenue, right, so $10 million, we typically think about incremental margins on that work in the 50% to 60% range. So, you add another $5 million to $6 million of EBITDA, and it puts us in the 22.5% to 23% range, which would have been right in line with our guidance of low 20s. So, effectively, it's really just that capital markets transactional volume, which explains the variance.

Great. Thank you for that. And then just shifting gears a little bit to regulations, you know, can you comment on basically, you know, how you think about how you will address kind of future regulations and regulatory change and whether or not you expect negative impact from the reduction in regulations, you know, specifically on kind of ESG in the U.S. and the EU?

Thank you, Charlie. It's Dan. And I'll start and then I'll ask Craig and Eric to make a couple comments. So, you know, relative to just broadly speaking, our teams are working to assess proposed regulations and if and how they fit with our offerings. And, you know, certainly if we're best suited to build on our own or to partner from a timing perspective, you know, typically a long lead time between a regulations proposal the comment period and then the effectiveness period and so one of the benefits of the platform that we've talked about and have built is our ability to get to market quicker and more economically as we share our common platform services this also lowers our investment required to serve core regulations So relative, you know, if we pivot over to your specific question on U.S., EU, ESG-related and the impact, de minimis impact to us, our plan was to leverage our existing platform entering the market as the last mile to the SEC for tagging and filing. So, you know, with that, I'd ask Craig if you want to add a little more detail.

Yeah, thanks, Dan. The global ESG regulations are certainly changing to reflect the current political climate. So here in the U.S., our clients are telling us that ultimately the court is going to vacate the ESG rule in its entirety. If you move to the EU, the EU president has said that their upcoming omnibus bill, which is expected on February 26, is to, quote, take a huge approach to reducing in one step all three ESG requirements that have previously been passed. So that includes their taxonomy, the CSRD, and the CS3D. And as Dan stated, there's very little impact to DFIN as a result of this, but I think it's worth noting that without an ESG mandate, our clients are talking about their ESG efforts within their documents today. And DFIN has met that moment with a one-stop shop. So, we're delivering through our compliance platform, active disclosure, the last mile of the SEC, as well as to our clients, shareholders, and investors. In addition to the general disclosure, DFIN for years has been providing an ESG fact sheet solution, which uses SASB guidelines. It's a really easy way for companies to take what they're doing and visualize that via design. So it's a presentation layer, again, integrated with an active disclosure. I think at the highest level, whether it's ESG or any new disclosure required, it highlights our value proposition. We have great software and client trust to make it happen.

Great. Yeah, Charles, if I could just add to that from an investment company's perspective. I think it's important to note, and Dan and David mentioned this, the tailored shareholder reports rule is really just passing the midway point and 2025 will be our first full year impact. So we're still working through that process with our clients, which will roll out through the balance of the year. And then as Dan mentioned around the benefits of our platform, the ARC suite is also very well positioned to help our clients meet the financial reporting requirements related to emerging new investment trends. I'm sure you're tracking and many have been watching what's happening in the market relative to broadening access to private markets for retail investors. So this is going to drive new products, different product structures. And as Dan mentioned, the benefits of our platform is the ability to be nimble and handle these financial reporting requirements, which are really based on historical regulations and reporting requirements. So we see some very nice positives in that area as well. And I'll just close out by saying, you know, the ARC suite is – our clients tell us they use it to drive cost efficiencies. They also use the streamlined processes via workflow and robust content management tools. So the utilization of the ARC suite goes well beyond, you know, this regulatory horizon. So we've got a lot of work to do this year relative to TSR and certainly some exciting things with new products being created with this private market shift to retail investors. Thanks.

That was insightful. Thank you very much. You got it. Thanks.

We'll go next to Kyle Peterson at Needham.

Great. Thank you. And good morning. I appreciate you guys taking my questions. I want to start off on the D-SPAC headwind that you guys kind of mentioned in the prepared remarks. I guess it seems like, I guess, how long should we think about this continuing to remain a Is this the last year, or how long is the tail on some of this activity?

Yeah, thank you for the question. This is Craig. Greg, I think you can expect that we're certainly at the tail end. The D-SPAC, SPAC market certainly took off in 20 through 21. And where we changed our strategy is, again, we had lower revenue in the quarter from D-SPAC transactions because we deprioritized these low-quality deals. So the market has shifted. When we look at a deal, it includes looking at D-SPACs that are going to happen with depleted trust due to redemptions, D-SPACs with poor financing. If you unpack what happened in Q4, there were 12 completed D-SPACs. 10 of them had done their IPO over three years ago and had almost nothing left in the trust due to redemptions. Two of them had previously terminated deals. Half of the targets they were acquiring were foreign, and almost all are now nano micro stocks, and many of them are at risk of D-list due to not meeting the NASDAQ or New York Stock Exchange listing requirements. So the market is coming to an end. Are there a few quality ones left? Yes, we will compete for those.

The new SEC chairman that's coming in has said he'll look at the rules that are passed, but we'll be very prescriptive about what we take, and I think we'll see that moving forward into the to the 25 and 26 market okay yeah and kyle i would just sorry kyle i would just add to it um you know a lot of that strategy you know over the last few years we've talked about the increase that we've seen um you know in the sgna line specifically as it relates to bad debt and so um you know we look back and and say you know when the spac market was at its peak, you know, from an economic perspective, it made sense to capture as much of that share as we could, knowing that there were going to be some winners and some losers in that arena. But as we go forward here and evaluate the quality, we're just being much more discerning on that as Craig outlined.

Okay. Appreciate the color on that. I wanted to switch over to the print and distribution revenue. I think historically, how you guys have kind of messaged it is we should think about kind of a single digit runoff. Obviously, it was quite a bit larger in 24. How should we think about the pace of print and distribution in 25? Should it kind of revert back to that mid single digit declines after the bigger reset in 2024, or how are you guys kind of budgeting for the print revenue for the coming year?

Yeah, and Kyle, thanks for the question. I should clarify, when we talk about print revenue declining in the, you know, call it four to five percent range, that's how we view just the overall secular trend, right? So the overall market, all else being equal. I think when you look at specific to our results, in addition to any, that underlying secular decline, we'll see variances, both positive and negative, relative to that baseline. You know, the best example probably was the special proxy in the fourth quarter of 2023, right, that really drives print revenue, certainly on transactional revenue to the extent that market activity reverts back to a more normalized level, there will be increased print demand with that as well. So you almost have to bifurcate the underlying print secular decline from market activity or event-driven activity, such as special proxies, et cetera. Sure.

Okay. Okay. That's good color. And then if I could just squeeze one last one in, particularly on capital allocation, you guys made a lot of progress and have the debt in a really good spot. You're continuing to buy back stock. How are you guys kind of thinking about this in 2025? And then is there any update? I think you guys were planning on annuitizing uh, your pension. Uh, so just any, any update or on timing or expected cash impact there would be be very helpful.

Yeah. So, um, a lot there, let me unpack it from a capital deployment perspective. I think you should expect business as usual, as we outlined in our prepared remarks, uh, you know, investing in the business, repurchasing shares and net debt reduction are the priorities for, for capital deployment. Um, so more of the same going forward, uh, specifically as it relates to the pension termination, we are still on track to have that done, uh, by the end of this year. Um, we don't yet have an estimate, um, that, that we're ready to share on the, um, on the, the cash contribution. Um, you know, I, I would say similar to, uh, the, the balance of our capital deployment, right? We took a pretty disciplined look at this and had waited for a while to do this transaction. And we're very confident that now is the right time to get this behind us.

Okay. Appreciate all the color. And thank you guys for taking my question. Thank you. Thank you.

We'll now take a follow-up from Charles Strouser at CJS Securities.

Hi, just a quick follow-up. We're looking at Q1 guidance. if you wouldn't mind providing a little bit more insight, color, really, in the confidence level you have behind the guidance and some of the assumptions you're baking into that.

Yeah, Charlie. So from an overall confidence perspective, obviously, we have a look at January at this point and factor in February activity. I think when you look at some of the variables obviously the the biggest one will be uh the assumption around capital markets transactional activity um as we noted in the prepared remarks right the the 45 million that we're assuming um for for capital markets transactions uh is down slightly from first quarter of 2024, down about $3 million. But also, the $45 million is a pretty significant increase from roughly $38 million that we did in the fourth quarter. Again, that's with the insight on how January came in and what we're seeing so far in February. I would say that still remains the biggest area of variability if we were to, you know, fast forward and look back, similar to what we saw in Q4, you know, where we were off $10 million. That's the area where, you know, we do have some visibility, but from a timing perspective, you know, tough to really understand when these deals will hit.

Great. To add maybe to a little bit of that, this is Craig. as stated, we're always subject to the uncertainty, and we are a little bit pleased with what we see early on. January was the busiest January for IPOs, which is good news since 2021. As of today, DFIN's IPO count is 11, so we've done 80% of the IPOs this year. It's worth noting that in full quarter of 24, there were only 14. So we're hopeful for that market. But it's still trying to find its direction. SailPoint, which was a decent client, priced last week. It's exciting. They only had three years of private equity ownership. And they had a lot of positives. So they priced at the high end. They had 10 million more shares than anticipated. But the headline after it was in TechCrunch, SailPoint's dull debut did little to unstick the IPO window. So we just don't know how these things are going to impact the market. As Dave said, we're planning for any market. We plan for continued volatility. We're off to a solid start. It only takes a few deals to make it happen. And then as you think about the M&A market, where we're really focused is some of the euphoria in that space has depleted a little bit. So you have the Wall Street Journal this past week, which had an article that the CEOs and bankers say that Trump euphoria is fading fast. And that deal market has been curtailed by the uncertainty earlier in the year. January had a decade low announced deals, just 900, which were compared to 1,200 in the prior year and 1,500 in 2023. So, again, a lot of optimism. You know, the partner of Paul Weiss in the article stated the tsunami of M&A is coming. It's just a ripe to arrive later. We have no idea when that's going to come, but given the nature of it, we're certainly focused from an M&A transaction perspective and then as it relates to venue in that space as well.

Thank you.

And that concludes our Q&A session. I will now turn the conference back over to Dan Lieb for closing remarks.

Thank you and thank you everyone for joining us. We look forward to speaking in a couple months.

And this concludes today's conference call. Thank you for your participation. You may now disconnect.