Bright Horizons Family Solutions Inc. (BFAM) Earnings Call Transcript & Summary

Good morning and welcome to the 2020 Annual Meeting for Bright Horizons Family Solutions. Our host for today's call is David Lissy, Chairman of the Board of Directors. I will now turn the call over to your host, Mr. Lissy. You may begin.

Good morning, everyone. I'm Dave Lissy, Chair of the Board of Bright Horizons Family Solutions. It's my pleasure to welcome you to our 2020 Annual Meeting of Shareholders. On behalf of our Board, officers and employees, thank you for attending the annual meeting. As a preliminary matter, we're hosting this virtual meeting by live audio webcast, which allows us to reach a greater number of our shareholders during these uncertain times. I will serve as Chair of the Meeting; and John Casagrande, our General Counsel and Corporate Secretary, will serve as Secretary. Mr. Casagrande and Terence Hassett, a representative of Broadridge Financial Solutions, will serve as Inspectors of Election. In addition to the Secretary and Inspectors of Election, joining me today are Stephen Kramer, our CEO; Elizabeth Boland, CFO; and Mary Lou Burke-Afonso, our Chief Operating Officer for North America. Certain members of our Board are on the line as well, as well as other employees of Bright Horizons. We're also joined by Brian McAllister of Deloitte & Touche LLP, our independent auditor, who's available to answer appropriate questions following the business portion of the meeting. Please note that this meeting will be conducted in accordance with the rules of conduct that are posted on the virtual meeting website. Please note that this meeting is being recorded. However, no one attending the meeting via webcast is permitted to use any recording device. Any shareholder who experiences technical difficulties during the meeting can call the technical support number posted on the virtual meeting website. It's now shortly after 8:00 a.m. Eastern Time, and in accordance with the notice of the meeting, I call the 2020 Annual Meeting to order. I'd like to take this opportunity to explain our order of business. As is custom, we will conduct the formal business portion of the meeting first. Once the formal business has been conducted, we will adjourn the meeting and answer any questions shareholders may have at the end of the meeting. Only validated shareholders who have joined the meeting using their control number may ask questions in the designated field on the virtual meeting website. If you've joined as a guest, you cannot use this function. [Operator Instructions] Although we may not be able to answer every question, we'll do our best to provide a response to as many questions as possible. We have a few procedural matters to discuss before we take up the primary business of the meeting. This meeting is held pursuant to the notice that was properly given on or about April 27, 2020, to all shareholders of record as of the close of business on the record date, April 20, 2020. Mr. Casagrande will file a proof of notice of this meeting with the minutes of this meeting. Mr. Casagrande, have you determined whether a quorum is present at this meeting?

Mr. Chair, after conferring with the Inspectors, I have determined that there are 55,511,396 shares, the company's common stock, of the 58,180,446 shares entitled to vote represented in person or by proxy at this meeting. This is 95.41% of the eligible votes, which total exceeds the majority of the total votes entitled to be cast by the holders of outstanding shares of common stock entitled to vote and is sufficient for a quorum and for transacting the business of this meeting.

Thanks. I find that a quorum is present for the purposes of conducting business at this meeting, and I declare that this meeting is legally convened and ready to transact business. On behalf of the company, I'd like to express my appreciation to all shareholders who returned their proxies that authorize the persons named in the proxy, Stephen Kramer, John Casagrande and Elizabeth Boland, to vote on all proposals coming before the meeting. All holders of the company's common stock as of the close of business on April 20, 2020, are entitled to vote at this meeting, either in person or by proxy, and are entitled to 1 vote for each share held in his or her name. As stated in the notice of the meeting, there are 3 items of business on our agenda. Proposal 1 is the election of 4 Class I directors to serve until the 2023 Annual Meeting of Shareholders and until such time as their respective successors are duly elected and qualified. The Board of Directors has nominated the following persons to serve as Class I directors: Stephen Kramer; Dr. Sara Lawrence-Lightfoot; David Lissy; and Cathy Minehan. Mr. Casagrande advises me there were no nominations by shareholders submitted to the company prior to this meeting in accordance with our bylaws. Accordingly, I declare the nominations closed. The Board recommends approval of the director nominees. Proposal 2 is the approval on an advisory basis of the compensation paid to the company's named executive officers. This is a nonbinding advisory vote to approve the compensation paid to our named executive officers as disclosed and discussed in the Compensation Discussion and Analysis section of our proxy statement. The Board recommends approval of the compensation of the named executive officers. Proposal 3 is the ratification of the appointment of Deloitte & Touche LLP as the company's independent registered public accounting firm for the fiscal year ending December 31, 2020. The Audit Committee has appointed Deloitte & Touche LLP as our independent registered public accounting firm for the fiscal year ending December 31, 2020, and the Board recommends ratification of this appointment. These items are more fully described in our notice and proxy statement. No other items of business have been submitted for consideration at the meeting in accordance with the company's bylaws or applicable law. [Operator Instructions] It's now 8:06 a.m., and I declare the online polls for this meeting -- I declare the online polls open for this meeting. Any shareholder who is yet to vote or wishes to change their vote may do so by clicking the Vote Here button on the virtual meeting website and following the instructions there. However, we urge all shareholders to allow their proxies to stand. Shareholders who have mailed their -- in proxies or have voted previously via telephone or Internet do not need to take any further action at this time. I'll now pause to allow shareholders to vote. [Voting]

Now that all shareholders have had the opportunity to vote, I declare the polls for this meeting closed as of 8:07 a.m. Will Mr. Casagrande please report the results of the ballot?

I have the preliminary report of Inspector based on the proxies already received. The final voting results will be presented in the company's current report on Form 8-K, which will be filed within 4 days following the end of the annual meeting. The preliminary report shows, with respect to the first proposal, the votes cast for each director nominee exceeded the votes cast against such nominee, and each of the nominees for Class I director received the majority of the votes cast. With respect to the second proposal, the compensation paid to our named executive officers has been approved by a majority of the votes cast. With respect to the third proposal, Deloitte & Touche LLP has been ratified as the company's independent registered public accounting firm for the fiscal year ending December 31, 2020, by a majority of the votes cast.

Thank you. Mr. Casagrande has indicated that each of the nominees for election as a director received the majority of the votes cast in the election. I therefore declare those persons to be duly elected directors of the company, hold office from this day until the 2023 Annual Meeting of Shareholders and until their successors are duly elected and qualified. I hereby further declare that the compensation paid to our named executive officers has been approved and that the appointment of Deloitte & Touche as the company's independent registered public accounting firm for the fiscal year ending December 1, 2020, has been ratified.

December 31.

Sorry. Excuse me, December 31, 2020, has been ratified. I hereby direct the results of the voting to be incorporated into the minutes of the meeting. So this concludes the business of our annual meeting. There being no further business to come before the meeting, the formal portion of our 2020 Annual Meeting of Shareholders is now adjourned. We would like to now open the meeting for shareholder questions that have been submitted today on the virtual meeting website. If you'd like to ask a question, please do so now. Please note, we will attempt to answer as many questions as time allows but only questions that are germane to this meeting and meet the guidelines set forth in the rules of conduct will be addressed. Any questions that we don't answer today may be raised separately after the annual meeting by contacting investor relations at investors.brighthorizons.com. Before we move to Q&A, please note this portion of the meeting may include forward-looking statements. Forward-looking statements are subject to numerous risks and uncertainties, which could cause further results to differ materially from those expressed in or implied by our comments. These risks and uncertainties are set forth in our SEC filings, including our annual report on 10-K and quarterly report on Form 10-Q. I will now pause as we poll for questions. Mr. Casagrande, do we have any questions?

Thank you, Mr. Lissy. At this time, we do not have any questions from shareholders.

Thank you, Mr. Casagrande. Then this concludes the meeting. Thank you all for joining the Bright Horizons 2020 Annual Meeting of Shareholders, and have a good day.

Thank you, ladies and gentlemen. This concludes today's meeting. Thank you for participating. You may now disconnect.