Bread Financial Holdings, Inc. (BFH) Earnings Call Transcript & Summary

Good morning, and welcome to the Alliance Data Systems Corporation 2020 Annual Meeting of Stockholders. I will now turn the meeting over to Mr. Ralph Andretta, President and Chief Executive Officer. Please go ahead, sir.

Thank you, and good morning, ladies and gentlemen. This is Ralph Andretta, and I would like to welcome you to the Annual Meeting of Stockholders of Alliance Data Systems Corporation for 2020. As President and Chief Executive Officer of the company, I will preside over the meeting. Due to the public health concerns related to the COVID-19 outbreak, the location and format of the meeting was changed to a virtual online live audio meeting. I call your attention to the rules of conduct set forth for this meeting available on our virtual annual meeting portal. Please review them as they are now in effect. The annual meeting materials are also available on our meeting portal. If we encounter any technical difficulties that prevent us from continuing the meeting, we will ask the stockholders and guests to stand by and allow us time to provide an update for the meeting. Before turning to voting matters, I thought I would provide a few introductory remarks about myself as this is my fourth month with the company and first annual stockholder meeting as Alliance Data's Chief Executive. I am a 25-year financial and operations executive, having spent most of my career at large global multibillion-dollar financial services companies, including Citi and American Express. Most recently, before coming to Alliance Data, I was Managing Director and Head of the U.S. Cards business for Citi. I have had success leading global teams, improving operational efficiencies and effectiveness, P&L leadership and financial performance. I can now add managing through a global pandemic to the list of career highlights which I'll speak to a little bit later. While at Citi, I introduced a number of highly successful products to the marketplace. I signed and resigned significant brand name partners. Additionally, under my leadership, Citi expanded new products and capabilities to card customers like digital deposits and installment lending. I am excited to be here and energized working with a terrific management team and more than 8,500 dedicated smart associates as we set our sight on Alliance Data's next exciting chapter. I have also appreciated getting to know and working closely with our Board of Directors, all of whom are attending virtually today. Turning now to some perfunctory matters. You may vote your shares through our meeting portal until the polls are closed. However, if you have already voted your shares prior to the start of the annual meeting, your vote has been received by the inspector of election, and there is no need to vote those shares during the annual meeting, unless you wish to revoke or change your vote. In addition, questions may be submitted through the meeting portal. Joe Motes, Executive Vice President, Chief Administrative Officer, General Counsel and Corporate Secretary of the company, has taken his oath and will act as inspector of election for the meeting. Jeff Plowman, a representative from our independent registered public accounting firm Deloitte Touche LLP is joining us today and will be available to answer questions relating to the company's financial statements, if any, at the end of the meeting. The Board of Directors set April 13, 2020, as a record date for stockholders for this meeting. A list of stockholders as of that date is available during the meeting on our meeting portal and was available for inspection for the last 10 days by any stockholder who had made such a request by contacting the Corporate Secretary's office. At this time, Mr. Motes will present a report of the Secretary regarding the timely notice of this meeting.

Mr. Andretta, the notice of availability of proxy materials was mailed on April 23, 2020, to stockholders of record of the company in accordance with the bylaws of the company. A supplemental notice of today's virtual meeting format was issued in a press release and filed with the SEC on May 14, 2020. In addition, I wish to report that a majority of the 47,627,016 shares of common stock outstanding as of the record date are represented at this meeting, either in person or by proxy. Therefore, a quorum is present for this Annual Meeting of Stockholders, and the meeting may proceed.

Thank you. The report of the Secretary is accepted and will be made part of the minutes of the meeting. We may now proceed to consider the business for which this meeting has been called. We will take questions on the proposals after all of the proposals have been presented. The polls are now open to vote on these proposals. The first item of business today is proposal 1, the election of directors. The 7 directors elected today will hold office until the Annual Meeting of Stockholders in 2021 and until their respective successors are duly elected and qualified. The affirmative vote of the majority of votes cast, a quorum being present, is required to elect directors. The following persons have been nominated as directors: Ralph J. Andretta; Roger H. Ballou; John C. Gerspach, Jr.; Rajesh Natarajan; Timothy J. Theriault; Laurie A. Tucker; Sharen J. Turney. Each of the nominees is attending this meeting virtually. The Board of Directors recommends stockholders vote for each of the 7 nominees. The second item of business is proposal 2, the advisory approval of compensation of our named executive officers. An affirmative vote of the majority of votes cast, a quorum being present, is required to approve the compensation of our named executive officers on an advisory basis. The Board of Directors recommends stockholders vote for this proposal. The third item of business is proposal 3, the approval of the 2020 Omnibus Incentive Plan. An affirmative vote of a majority of votes cast, a quorum being present, is required to approve the 2020 plan. The Board of Directors recommends a vote for this proposal. The fourth item of business is proposal 4, the ratification of the selection of Deloitte Touche LLP as the independent registered public accounting firm of the company for 2020. An affirmative vote of a majority of votes cast, a quorum being present, is required to approve the ratification of the selection of Deloitte Touche LLP as the independent registered public accounting firm of the company for 2020. The Board of Directors recommends stockholders vote for this proposal. We will now respond to questions from stockholders on all of the proposals.

Mr. Andretta, there are no questions on the proposals.

Since there are no questions, I will close the polls momentarily. If you have not yet voted and wish to do so, please do so now. [Voting]

I now declare the polls closed and all matters have been voted upon by stockholders. Mr. Motes, please report the results.

Based on the preliminary review of the votes cast, each nominee for director has been elected as a director of the company, and our stockholders have approved the compensation of our named executive officers, the 2020 Omnibus Incentive Plan and the ratification of the selection of Deloitte & Touche LLP as the independent registered public accounting firm of the company for 2020. A written report of the final vote count on the 4 proposals voted on at today's meeting will be included in the minutes of the meeting. The final voting results will be reported in a Form 8-K filed with the SEC within 4 business days of today's meeting. I will now turn the meeting back over to you, Mr. Andretta.

Thank you, Mr. Motes. That completes the official business of the meeting, and the formal meeting is now adjourned. At this point, I now want to provide additional detail regarding progress Alliance Data has made on our Board refreshment efforts. As you just heard, we have 3 long-term directors that have completed their Board service today. I would like to acknowledge and thank departing directors, Bruce Anderson, Ken Jensen and Rob Minicucci for their valuable leadership and years of service to the company. I am pleased to share that a long-standing director, Mr. Roger Ballou, has been appointed Board Chair. And last, we have 2 new directors joining: Mr. John Gerspach and Mr. Rajesh Natarajan, who bring significant experience -- expertise and experience in areas of critical importance to Alliance Data's business, including banking and financial services and digital online capabilities, among others. I would encourage you to refer to our public filings and the company's website where you can read the bios of all our Board of Directors. I am pleased with the progress we have made to diversify our Board across various criteria, including critical skills, expertise, industry experience, gender and ethnicity and tenure, all of which form the underpinnings of a solid Board representation necessary for effective and responsible corporate governance and oversight of our business. In closing, I want to share a few words regarding Alliance Data's priorities, which are even more important now during such unprecedented times. As we continue to navigate through the pandemic, our leadership team and I are laser-focused on initiatives critical to our near-term and long-term business performance. Those priorities include prudent and responsible expense management across the entire organization, continued support of our partners to ensure we are providing a strong partnership focused on positive mutual outcomes and our ongoing assessment of strategic investment opportunities that coincide with the needs and direction of our evolved business. That concludes my prepared remarks. We will now answer any questions about Alliance Data that was submitted by our stockholders. As a reminder, the rules of the meeting remain in effect. Please note, we will attempt to answer as many questions as time allows, but only questions that are germane to the meeting will be addressed. Let's start with the first question, please.

Mr. Andretta, there are no questions.

Thank you. Since there are no questions, that concludes the meeting. Thank you very much for attending.

Ladies and gentlemen, this concludes the meeting. You may now disconnect. Thank you. Have a good day.