GlobeNewswire Inc | Feb 8, 2021 04:01PM EST

February 08, 2021

HOFFMAN ESTATES, Ill., Feb. 08, 2021 (GLOBE NEWSWIRE) --

CDK Global, Inc. (NASDAQ:CDK) today announced financial results for its fiscal 2021 second quarter ended December 31, 2020.

"I'm extremely proud of what our teams accomplished, as we launched Neuron, our data intelligence platform and continued our initiatives to bring even more value to our dealer and OEM customers with new products and innovative technology. The efforts of our ongoing customer-first strategy resulted in achieving a new company record high net promoter score," said Brian Krzanich, CDK chief executive officer. "We remain very optimistic about our strategy to focus on growth opportunities in North America, giving us confidence we can deliver sustainable growth and create long-term shareholder value."

"We reached the highest site count in company history and increased revenue per site in both our auto and adjacency businesses, while we continue to deal with the broader uncertainty of the macro environment," said Eric Guerin, CDK chief financial officer. "As we move toward closing the sale of the CDK International business later this third quarter, Im quite pleased with our strong financial position and ability to implement our growth strategy."

On November 27, 2020, we entered into an agreement to sell the International business and as a result, the assets and liabilities of the International business are considered held for sale and the financial results are presented in net earnings from discontinued operations in the Consolidated Statements of Operations. Prior year amounts associated with the International business have been reclassified. Therefore, non-GAAP results in the table below exclude the International business.

Second Quarter Fiscal 2021 Results

CDK Global, Inc. Change Q2 2021 from ($ million except per share) Q2 2020

Revenue $ 406.3 -3 % GAAP Earnings before income taxes 81.5 -19 % Non-GAAP Adjusted earnings before income taxes 100.7 -16 % GAAP Diluted earnings attributable to CDK per 0.56 n/m share Non-GAAP Adjusted diluted earnings attributable 0.59 -17 % to CDK per share GAAP effective tax rate 27.9 % -1230 bps Non-GAAP effective tax rate 26.2 % 70 bps GAAP Net earnings attributable to CDK 68.3 n/m GAAP Net earnings attributable to CDK margin 16.8 % 1150 bps Non-GAAP Adjusted EBITDA 155.5 -11 % Non-GAAP Adjusted EBITDA margin 38.3 % -350 bps

The non-GAAP results and guidance presented in this press release represent non-GAAP financial measures. Reconciliations of these measures to the most directly comparable GAAP measures are provided in the tables at the end of this press release.

Fiscal 2021 Annual GuidanceThe fiscal 2021 guidance is provided on both a GAAP and a Non-GAAP basis.The non-GAAP guidance in the table below excludes the International business results and the expected gain on the sale as these amounts are now reported within discontinued operations. The GAAP revenue also excludes the International business as the financial results are reported within discontinued operations on a net earnings basis.

CDK Global, Inc. - GAAP BASIS FY 2021 GAAP ($ million except per share) GUIDANCE Revenue $1,660 - $1,710 GAAP Diluted earnings attributable to CDK per share $8.10 - $8.40 GAAP Net earnings attributable to CDK $990 - $1,030 GAAP Effective tax rate 29 - 30%

CDK Global, Inc. - Non-GAAP BASIS FY 2021 ADJ. ($ million except per share) GUIDANCE Revenue $1,660 - $1,710 Non-GAAP Adjusted diluted earnings attributable to CDK $2.45 - $2.75 per share Non-GAAP Adjusted EBITDA $640 - $680 Non-GAAP Adjusted effective tax rate 26 - 27%

Website SchedulesOther financial information, including financial statements and supplementary schedules presented on a GAAP and adjusted basis, and the schedule of quarterly revenue have been updated for the second quarter ended December 31, 2020 and will be posted to the CDK Investor Relations website, https://investors.cdkglobal.com, in the Financial Information section.

Webcast and Conference CallAn analyst conference call will be held today, Monday, February 8, 2021 at 4:00 p.m. CT. A live webcast of the call will be available on a listen-only basis. To listen to the webcast, go to the CDK Investor Relations website, https://investors.cdkglobal.com, and click on the webcast icon. A supplemental slide presentation will be available to download and print about 30 minutes before the webcast at the CDK Investor Relations website at https://investors.cdkglobal.com. CDK financial news releases, current financial information, SEC filings and Investor Relations presentations are accessible at the same website.

About CDK GlobalCDK Global (Nasdaq: CDK) is a leading provider of integrated data and technology solutions to the automotive, heavy truck, recreation and heavy equipment industries. Focused on enabling end-to-end, omnichannel retail commerce through open, agnostic technology, CDK Global provides solutions to dealers and original equipment manufacturers, serving nearly 15,000 retail locations in North America. CDK solutions connect people with technology by automating and integrating all parts of the dealership and buying process, including the acquisition, sale, financing, insuring, parts supply, repair and maintenance of vehicles. Visit cdkglobal.com

Safe Harbor for Forward-Looking Statements

This press release contains "forward-looking statements" within the meaning statements regarding the sale of the CDK International business ("International Business"); the Companys business outlook, including the Companys GAAP and adjusted fiscal 2021 guidance; other plans; objectives; forecasts; goals; beliefs; business strategies; future events; business conditions; results of operations; financial position and business outlook and trends; and other information, may be forward-looking statements. Words such as "might," "will," "may," "could," "should," "estimates," "expects," "continues," "contemplates," "anticipates," "projects," "plans," "potential," "predicts," "intends," "believes," "forecasts," "future," "assumes," and variations of such words or similar expressions are intended to identify forward-looking statements. These statements are based on management's expectations and assumptions and are subject to risks and uncertainties that may cause actual results to differ materially from those expressed, or implied by, these forward-looking statements.

Factors that could cause actual results to differ materially from those contemplated by the forward-looking statements include: the timing of or failure to obtain necessary regulatory approvals or to satisfy any of the other conditions to the sale of the International Business, the Companys ability to achieve the intended benefits of the sale of the International Business and the expected costs of the sale of the International Business; the Companys expectations regarding the potential impacts on the Companys business of the outbreak of the COVID-19 pandemic; the Companys success in obtaining, retaining and selling additional services to customers; the pricing of the Companys products and services; overall market and economic conditions, including interest rate and foreign currency trends, and technology trends; adverse global economic conditions and credit markets and volatility in the countries in which we do business; auto sales and related industry changes; competitive conditions; changes in regulation; changes in technology, security breaches, interruptions, failures and other errors involving the Companys systems; availability of skilled technical employees/labor/personnel; the impact of new acquisitions and divestitures; employment and wage levels; availability of capital for the payment of debt service obligations or dividends or the repurchase of shares; any changes to the Companys credit ratings and the impact of such changes on financing costs, rates, terms, debt service obligations, access to capital market and working capital needs; the impact of the Companys indebtedness, access to cash and financing, and ability to secure financing, or financing at attractive rates; the onset of or developments in litigation involving contract, intellectual property, competition, shareholder, and other matters, and governmental investigations; and the ability of the Companys significant stockholders and their affiliates to significantly influence the Companys decisions or cause it to incur significant costs.

There may be other factors that may cause the Companys actual results, performance or achievements to differ materially from those expressed in, or implied by, the forward-looking statements. The Company gives no assurances that any of the events anticipated by the forward-looking statements will occur or, if any of them do, what impact they will have on its results of operations and financial condition. You should carefully read the factors described in the Companys reports filed with theSecurities and Exchange Commission("SEC"), including those discussed under "Part I, Item 1A. Risk Factors" in its most recent Annual Report on Form 10-K and its most recent Quarterly Report on Form 10-Q for a description of certain risks that could, among other things, cause the Companys actual results to differ from any forward-looking statements contained herein. These filings can be found on the Companys website at https://investors.cdkglobal.comand theSEC'swebsite atwww.sec.gov.

All forward-looking statements speak only as of the date of this press release even if subsequently made available by the Company on its website or otherwise. The Company disclaims any obligation to update or revise any forward-looking statements that may be made to reflect new information or future events or circumstances that arise after the date made or to reflect the occurrence of unanticipated events, other than as required by law.

Investor Relations Contact: Media Contact:Julie Schlueter Roxanne Pipitone847.485.4643 847.485.4423julie.schlueter@cdk.com roxanne.pipitone@cdk.com

CDK Global, Inc.Consolidated Statements of Operations(In millions, except per share amounts)(Unaudited)

Three Months Ended Six Months Ended December 31, December 31, 2020 2019 2020 2019Revenue $ 406.3 $ 418.2 $ 820.0 $ 835.9 Expenses: Cost of revenue 207.7 193.1 432.4 400.1 Selling, general and 85.0 90.9 173.6 177.5 administrative expensesLitigation provision ? ? 12.0 ? Total expenses 292.7 284.0 618.0 577.6 Operating earnings 113.6 134.2 202.0 258.3 Interest expense (34.3 ) (36.2 ) (69.0 ) (73.9 ) Loss from equity method (1.8 ) ? (5.2 ) ? investmentOther income, net 4.0 2.5 28.7 4.4 Earnings before income 81.5 100.5 156.5 188.8 taxes Provision for income (22.7 ) (40.4 ) (49.7 ) (63.8 ) taxes Net earnings from 58.8 60.1 106.8 125.0 continuing operationsNet earnings (loss) from 11.3 (36.0 ) 21.3 (16.8 ) discontinued operationsNet earnings 70.1 24.1 128.1 108.2 Less: net earningsattributable to 1.8 1.8 4.1 3.9 noncontrolling interestNet earnings attributable $ 68.3 $ 22.3 $ 124.0 $ 104.3 to CDK Net earnings attributable to CDK per share - basic:Continuing operations $ 0.47 $ 0.48 $ 0.85 $ 1.00 Discontinued operations 0.09 (0.30 ) 0.17 (0.14 ) Total net earningsattributable to CDK per $ 0.56 $ 0.18 $ 1.02 $ 0.86 share - basic Net earnings attributableto CDK per share - diluted:Continuing operations $ 0.47 $ 0.47 $ 0.84 $ 0.99 Discontinued operations 0.09 (0.29 ) 0.17 (0.14 ) Total net earningsattributable to CDK per $ 0.56 $ 0.18 $ 1.01 $ 0.85 share - diluted Weighted-average common shares outstanding:Basic 121.9 121.6 121.8 121.5 Diluted 122.6 122.1 122.3 122.1

The International Business is presented as discontinued operations and prior year amounts associated with the International Business have been reclassified as such. For additional information refer to Form 10-Q, Item 1 of Part I, "Notes to the Consolidated Financial Statements," Note 1 - Basis of Presentation and Note 4 - Discontinued Operations.

CDK Global, Inc. Consolidated Balance Sheets(In millions)(Unaudited)

December 31, June 30, 2020 2020Assets Cash and cash equivalents $ 62.8 $ 80.8 Accounts receivable, net of allowances 228.4 242.0 Other current assets 146.1 148.4 Current assets held for sale 762.2 214.4 Total current assets 1,199.5 685.6 Property, plant and equipment, net 85.8 96.7 Other assets 413.4 418.3 Goodwill 1,001.0 999.5 Intangible assets, net 235.7 229.5 Long-term assets held for sale ? 424.5 Total assets $ 2,935.4 $ 2,854.1 Liabilities and Stockholders' Deficit Current maturities of long-term debt and finance $ 320.3 $ 20.7 lease liabilitiesAccounts payable 24.6 34.3 Accrued expenses and other current liabilities 175.1 188.3 Litigation liability 34.0 57.0 Accrued payroll and payroll-related expenses 53.1 52.5 Short-term deferred revenue 42.1 44.6 Current liabilities held for sale 158.2 129.4 Total current liabilities 807.4 526.8 Long-term debt and finance lease liabilities 2,333.5 2,655.1 Long-term deferred revenue 40.4 39.4 Deferred income taxes 78.4 76.4 Other liabilities 100.9 96.5 Long-term liabilities held for sale ? 40.6 Total liabilities 3,360.6 3,434.8 Stockholders' Deficit: Preferred stock ? ? Common stock 1.6 1.6 Additional paid-in capital 696.3 687.9 Retained earnings 1,124.4 1,045.5 Treasury stock, at cost (2,295.3 ) (2,305.2 ) Accumulated other comprehensive loss 34.5 (25.9 ) Total CDK stockholders' deficit (438.5 ) (596.1 ) Noncontrolling interest 13.3 15.4 Total stockholders' deficit (425.2 ) (580.7 ) Total liabilities and stockholders' deficit $ 2,935.4 $ 2,854.1

The International Business is presented as discontinued operations and prior year amounts associated with the International Business have been reclassified as such. For additional information refer to Form 10-Q, Item 1 of Part I, "Notes to the Consolidated Financial Statements," Note 1 - Basis of Presentation and Note 4 - Discontinued Operations.

CDK Global, Inc. Consolidated Statements of Cash Flows(In millions)(Unaudited)

Six Months Ended December 31, 2020 2019Cash Flows from Operating Activities: Net earnings $ 128.1 $ 108.2 Less: net earnings (loss) from discontinued 21.3 (16.8 ) operationsNet earnings from continuing operations 106.8 125.0 Adjustments to reconcile net earnings fromcontinuing operations to cash flows provided by operating activities:Depreciation and amortization 46.5 44.4 Loss from equity method investment 5.2 ? Deferred income taxes 2.5 15.2 Stock-based compensation expense 21.3 11.0 Other 4.0 10.3 Changes in assets and liabilities, net of effect from acquisitions of businesses:Change in accounts receivable 15.5 (20.8 ) Change in other assets (5.5 ) (4.6 ) Change in accounts payable (10.3 ) (11.8 ) Change in accrued expenses and other liabilities (38.7 ) (28.5 ) Net cash flows provided by operating activities, 147.3 140.2 continuing operationsNet cash flows provided by (used in) operating 25.9 38.5 activities, discontinued operationsNet cash flows provided by operating activities 173.2 178.7 Cash Flows from Investing Activities: Capital expenditures (10.1 ) (9.1 ) Capitalized software (31.9 ) (26.4 ) Investment in certificates of deposit ? (12.0 ) Proceeds from maturities of certificates of deposit ? 7.3 Net cash flows used in investing activities, (42.0 ) (40.2 ) continuing operationsNet cash flows used in investing activities, (4.6 ) (7.9 ) discontinued operationsNet cash flows used in investing activities (46.6 ) (48.1 ) Cash Flows from Financing Activities: Net proceeds (repayments) from revolving credit (15.0 ) 90.0 facilityRepayments of long-term debt and finance lease (10.9 ) (260.4 ) liabilitiesDividends paid to stockholders (36.5 ) (36.5 ) Proceeds from exercises of stock options 2.0 4.9 Withholding tax payments for stock-based (4.2 ) (5.7 ) compensation awardsDividend payments to noncontrolling owners (6.2 ) (6.6 ) Acquisition-related payments ? (4.7 ) Net cash flows used in financing activities, (70.8 ) (219.0 ) continuing operationsNet cash flows used in financing activities, ? (1.1 ) discontinued operationsNet cash flows used in financing activities (70.8 ) (220.1 ) Effect of exchange rate changes on cash, cash 22.1 1.3 equivalents, and restricted cashNet change in cash, cash equivalents and restrictedcash, including cash classified in current assets 77.9 (88.2 ) held for saleLess: Net change in cash classified in current (102.8 ) 6.6 assets held for saleNet change in cash, cash equivalents and restricted (24.9 ) (81.6 ) cashCash, cash equivalents, and restricted cash, 97.3 144.2 beginning of periodCash, cash equivalents, and restricted cash, end of $ 72.4 $ 62.6 period

The International Business is presented as discontinued operations and prior year amounts associated with the International Business have been reclassified as such. For additional information refer to Form 10-Q, Item 1 of Part I, "Notes to the Consolidated Financial Statements," Note 1 - Basis of Presentation and Note 4 - Discontinued Operations

CDK Global, Inc.Consolidated Adjusted Financial Information(In millions, except per share amounts)(Unaudited)

As described below under the Non-GAAP Financial Measures section of this press release, we incorporated the following additional adjustments in our calculations of non-GAAP financial measures where management has deemed it appropriate to better reflect our underlying operations. These adjustments are inconsistent in amount and frequency and do not directly reflect our underlying operations. Therefore, management believes that excluding such information provides us with a better understanding of our ongoing operating performance across periods.

Three Months Ended Six Months Ended December 31, Change December 31, Change 2020 2019 $ % 2020 2019 $ %Revenue (a) $ 406.3 $ 418.2 $ (11.9 ) (3 ) % $ 820.0 $ 835.9 $ (15.9 ) (2 ) %Impact of exchange (0.3 ) ? (0.1 ) ? ratesConstant currency $ 406.0 $ 418.2 $ (12.2 ) (3 ) % $ 819.9 $ 835.9 $ (16.0 ) (2 ) %revenue (a) (b) Earnings before $ 81.5 $ 100.5 $ (19.0 ) (19 ) % $ 156.5 $ 188.8 $ (32.3 ) (17 ) %income taxes (a)Margin 20.1 % 24.0 % -390 bps 19.1 % 22.6 % -350 bpsTotal stock-based 9.0 7.2 21.3 11.0 compensationAmortization ofacquired intangible 4.2 3.7 8.2 7.6 assetsTransaction andintegration-related 1.2 ? 1.2 8.5 costsLegal and otherexpenses related to 0.7 4.8 14.7 12.2 regulatory andcompetition mattersBusiness processmodernization 2.6 3.3 5.5 7.6 programOfficer transition ? ? 1.1 ? expenseNet adjustmentsrelated to loss 1.5 ? 4.5 ? from equity methodinvestmentAdjusted earningsbefore income taxes $ 100.7 $ 119.5 $ (18.8 ) (16 ) % $ 213.0 $ 235.7 $ (22.7 ) (10 ) %(a) (b)Adjusted margin 24.8 % 28.6 % -380 bps 26.0 % 28.2 % -220 bpsImpact of exchange (0.1 ) ? ? ? ratesConstant currencyadjusted earnings $ 100.6 $ 119.5 $ (18.9 ) (16 ) % $ 213.0 $ 235.7 $ (22.7 ) (10 ) %before income taxes(a) (b)

Three Months Ended Six Months Ended December 31, Change December 31, Change 2020 2019 $ % 2020 2019 $ %Provisionfor income $ 22.7 $ 40.4 $ (17.7 ) (44 ) % $ 49.7 $ 63.8 $ (14.1 ) (22 ) %taxes (a)Effective 27.9 % 40.2 % 31.8 % 33.8 % tax rateIncome taxeffect of 3.7 4.9 9.7 11.1 pre-taxadjustmentsChange invaluation ? (14.8 ) ? (14.8 ) allowanceImpact ofU.S tax ? ? ? 0.3 reformAdjustedprovisionfor income $ 26.4 $ 30.5 $ (4.1 ) (13 ) % $ 59.4 $ 60.4 $ (1.0 ) (2 ) %taxes (a)(b)Adjustedeffective 26.2 % 25.5 % 27.9 % 25.6 % tax rate

Three Months Ended Six Months Ended December 31, Change December 31, Change 2020 2019 $ % 2020 2019 $ %Net earnings $ 70.1 $ 24.1 $ 46.0 n/m $ 128.1 $ 108.2 $ 19.9 18 %Less: net earningsattributable to 1.8 1.8 4.1 3.9 noncontrollinginterestNet earnings $ 68.3 $ 22.3 $ 46.0 n/m $ 124.0 $ 104.3 $ 19.7 19 %attributable to CDKNet (earnings) lossfrom discontinued (11.3 ) 36.0 (21.3 ) 16.8 operationsTotal stock-based 9.0 7.2 21.3 11.0 compensationAmortization ofacquired intangible 4.1 3.6 8.0 7.4 assets (c)Transaction andintegration-related 1.2 ? 1.2 8.5 costsLegal and otherexpenses related to 0.7 4.8 14.7 12.2 regulatory andcompetition mattersBusiness processmodernization 2.6 3.3 5.5 7.6 programOfficer transition ? ? 1.1 ? expenseNet adjustmentsrelated to loss 1.5 ? 4.5 ? from equity methodinvestmentIncome tax effecton pre-tax (3.7 ) (4.9 ) (9.7 ) (11.1 ) adjustmentsChange in valuation ? 14.8 ? 14.8 allowanceImpact of U.S tax ? ? ? (0.3 ) reformAdjusted netearnings $ 72.4 $ 87.1 $ (14.7 ) (17 ) % $ 149.3 $ 171.2 $ (21.9 ) (13 ) %attributable to CDK(a) (b) (c)

Three Months Ended Six Months Ended December 31, Change December 31, Change 2020 2019 $ % 2020 2019 $ %Diluted earningsattributable to CDK $ 0.56 $ 0.18 $ 0.38 n/m $ 1.01 $ 0.85 $ 0.16 19 %per shareNet (earnings) lossfrom discontinued (0.09 ) 0.29 (0.17 ) 0.14 operationsTotal stock-based 0.07 0.06 0.17 0.09 compensationAmortization ofacquired intangible 0.03 0.03 0.07 0.06 assets (c)Transaction andintegration-related 0.01 ? 0.01 0.07 costsLegal and otherexpenses related to 0.01 0.04 0.12 0.10 regulatory andcompetition mattersBusiness processmodernization 0.02 0.03 0.04 0.06 programOfficer transition ? ? 0.01 ? expenseNet adjustmentsrelated to loss 0.01 ? 0.04 ? from equity methodinvestmentIncome tax effecton pre-tax (0.03 ) (0.04 ) (0.08 ) (0.09 ) adjustmentsChange in valuation ? 0.12 ? 0.12 allowanceImpact of U.S tax ? ? ? ? reform actAdjusted dilutedearningsattributable to CDK $ 0.59 $ 0.71 $ (0.12 ) (17 ) % $ 1.22 $ 1.40 $ (0.18 ) (13 ) %per share (a) (b)(c) Weighted-averagecommon shares outstanding:Diluted 122.6 122.1 122.3 122.1

Three Months Ended Six Months Ended December 31, Change December 31, Change 2020 2019 $ % 2020 2019 $ %Net earnings $ 68.3 $ 22.3 $ 46.0 n/m $ 124.0 $ 104.3 $ 19.7 19 %attributable to CDKMargin 16.8 % 5.3 % 1150 bps 15.1 % 12.5 % 260 bpsNet earningsattributable to 1.8 1.8 4.1 3.9 noncontrollinginterestNet (earnings) lossfrom discontinued (11.3 ) 36.0 (21.3 ) 16.8 operationsProvision for 22.7 40.4 49.7 63.8 income taxesInterest expense 34.3 36.2 69.0 73.9 Depreciation and 23.4 22.6 46.5 44.4 amortizationTotal stock-based 9.0 7.2 21.3 11.0 compensationTransaction andintegration-related 1.2 ? 1.2 8.5 costsLegal and otherexpenses related to 0.7 4.8 14.7 12.2 regulatory andcompetition mattersBusiness processmodernization 2.6 3.3 5.5 7.6 programOfficer transition ? ? 1.1 ? expenseNet adjustmentsrelated to loss 2.8 ? 7.3 ? from equity methodinvestmentAdjusted EBITDA (a) $ 155.5 $ 174.6 $ (19.1 ) (11 ) % $ 323.1 $ 346.4 $ (23.3 ) (7 ) %(b)Adjusted margin 38.3 % 41.8 % -350 bps 39.4 % 41.4 % -200 bps

Six Months Ended December 31, 2020 2019Net cash flows provided by operating activities $ 173.2 $ 178.7 Net cash flows used in (provided by) operating (25.9 ) (38.5 ) activities - discontinued operationsCapital expenditures (10.1 ) (9.1 ) Capitalized software (31.9 ) (26.4 ) Change in restricted cash 6.9 (0.8 ) Free cash flow from continuing operations (a) $ 112.2 $ 103.9 (b)

(a) Excludes amounts attributable to discontinued operations.(b) Refer to the Non-GAAP Financial Measures section of this press release for additional information on our non-GAAP adjustments.(c)The portion of expense related to noncontrolling interest has been removed from amortization of acquired intangible assets for the three and six months ended December 31, 2020 and 2019.

CDK Global, Inc.Revenue Disaggregation(In millions)(Unaudited)

The following table presents revenue by revenue category for the three and six months ended December31, 2020 and 2019:

Three Months Ended Six Months Ended December 31, Change December 31, Change 2020 2019 $ % 2020 2019 $ %Subscription $ 328.3 $ 336.8 $ (8.5 ) (3 ) % $ 652.2 $ 669.2 $ (17.0 ) (3 ) %On-site license and 1.5 3.0 (1.5 ) (50 ) % 3.2 5.1 (1.9 ) (37 ) %installationTransaction 39.1 39.8 (0.7 ) (2 ) % 83.0 82.5 0.5 1 %Other 37.4 38.6 (1.2 ) (3 ) % 81.6 79.1 2.5 3 %Total $ 406.3 $ 418.2 $ (11.9 ) (3 ) % $ 820.0 $ 835.9 $ (15.9 ) (2 ) %

CDK Global, Inc.Recast of Financial Information for the Six Quarterly Periods ending December 31, 2020(In millions, except per share amounts)(Unaudited)

The following tables provide the GAAP Statement of Operations and Non GAAP financial performance measures

Three Months Ended Sep 30, Dec 31, Mar 31, Jun 30, Sep 30, Dec 31, 2019 2019 2020 2020 2020 2020Revenue $ 417.7 $ 418.2 $ 426.4 $ 376.7 $ 413.7 $ 406.3 Expenses: Cost of revenue 207.0 193.1 198.8 201.7 224.7 207.7 Selling, generaland administrative 86.6 90.9 81.6 79.6 88.6 85.0 expensesLitigation ? ? ? ? 12.0 ? provisionTotal expenses 293.6 284.0 280.4 281.3 325.3 292.7 Operating earnings 124.1 134.2 146.0 95.4 88.4 113.6 Interest expense (37.7 ) (36.2 ) (35.2 ) (35.0 ) (34.7 ) (34.3 ) Loss from equity ? ? ? (2.7 ) (3.4 ) (1.8 ) method investmentOther income, net 1.9 2.5 (1.7 ) 18.4 24.7 4.0 Earnings before 88.3 100.5 109.1 76.1 75.0 81.5 income taxes Provision for (23.4 ) (40.4 ) (31.7 ) (13.3 ) (27.0 ) (22.7 ) income taxes Net earnings fromcontinuing 64.9 60.1 77.4 62.8 48.0 58.8 operationsNet earnings (loss)from discontinued 19.2 (36.0 ) (17.9 ) (16.0 ) 10.0 11.3 operationsNet earnings 84.1 24.1 59.5 46.8 58.0 70.1 Less: net earningsattributable to 2.1 1.8 1.9 1.2 2.3 1.8 noncontrollinginterestNet earnings $ 82.0 $ 22.3 $ 57.6 $ 45.6 $ 55.7 $ 68.3 attributable to CDK Net earnings (loss)attributable to CDK per share - basic:Continuing $ 0.52 $ 0.48 $ 0.62 $ 0.51 $ 0.38 $ 0.47 operationsDiscontinued 0.16 (0.30 ) (0.15 ) (0.13 ) 0.08 0.09 operationsTotal net earningsattributable to CDK $ 0.68 $ 0.18 $ 0.47 $ 0.38 $ 0.46 $ 0.56 per share - basic Net earnings (loss)attributable to CDK per share -diluted:Continuing $ 0.51 $ 0.47 $ 0.62 $ 0.50 $ 0.38 $ 0.47 operationsDiscontinued 0.16 (0.29 ) (0.15 ) (0.13 ) 0.08 0.09 operationsTotal net earningsattributable to CDK $ 0.67 $ 0.18 $ 0.47 $ 0.37 $ 0.46 $ 0.56 per share - diluted Weighted-averagecommon shares outstanding:Basic 121.4 121.6 121.6 121.6 121.7 121.9 Diluted 122.0 122.1 122.2 122.1 122.3 122.6

Three Months Ended Sep 30, Dec 31, Mar 31, Jun 30, Sep 30, Dec 31, 2019 2019 2020 2020 2020 2020Subscription $ 332.4 $ 336.8 $ 331.7 $ 305.1 $ 323.9 328.3 RevenueOn-sitelicense and 2.1 3.0 2.4 3.3 1.7 1.5 installationTransaction 42.7 39.8 38.1 34.4 43.9 39.1 Other 40.5 38.6 54.2 33.9 44.2 37.4 Total $ 417.7 $ 418.2 $ 426.4 $ 376.7 $ 413.7 $ 406.3

As described below under the Non-GAAP Financial Measures section of this press release, we incorporated the following additional adjustments in our recast of calculations of non-GAAP financial measures where management has deemed it appropriate to better reflect our underlying operations. These adjustments are inconsistent in amount and frequency and do not directly reflect our underlying operations. Therefore, management believes that excluding such information provides us with a better understanding of our ongoing operating performance across periods.

Three Months Ended Sep 30, Dec 31, Mar 31, Jun 30, Sep 30, Dec 31, 2019 2019 2020 2020 2020 2020Revenue (a) $ 417.7 $ 418.2 $ 426.4 $ 376.7 $ 413.7 $ 406.3 Earnings before $ 88.3 $ 100.5 $ 109.1 $ 76.1 $ 75.0 $ 81.5 income taxes (a)Margin 21.1 % 24.0 % 25.6 % 20.2 % 18.1 % 20.1 %Total stock-based 3.8 7.2 2.2 6.0 12.3 9.0 compensationAmortization ofacquired intangible 3.9 3.7 3.8 3.9 4.0 4.2 assetsTransaction andintegration-related 8.5 ? ? 1.0 ? 1.2 costsLegal and otherexpenses related to 7.4 4.8 4.4 2.8 14.0 0.7 regulatory andcompetition mattersBusiness processmodernization 4.3 3.3 4.4 4.1 2.9 2.6 programOfficer transition ? ? ? ? 1.1 ? expenseNet adjustmentsrelated to loss ? ? ? 2.2 3.0 1.5 from equity methodinvestmentAdjusted earningsbefore income taxes $ 116.2 $ 119.5 $ 123.9 $ 96.1 $ 112.3 $ 100.7 (a) (b)Adjusted margin 27.8 % 28.6 % 29.1 % 25.5 % 27.1 % 24.8 %

Three Months Ended Sep 30, Dec 31, Mar 31, Jun 30, Sep 30, Dec 31, 2019 2019 2020 2020 2020 2020Provision for income $ 23.4 $ 40.4 $ 31.7 $ 13.3 $ 27.0 $ 22.7 taxes (a)Effective tax rate 26.5 % 40.2 % 29.1 % 17.5 % 36.0 % 27.9 %Income tax effect of 6.2 4.9 3.8 4.9 6.2 3.7 pre-tax adjustmentsIncome tax effect forforeign earningspreviously deemed ? ? (7.0 ) 4.4 ? ? indefinitelyreinvestedChange in valuation ? (14.8 ) ? ? ? ? allowanceImpact of U.S tax 0.3 ? ? ? ? ? reformAdjusted provisionfor income taxes (a) $ 29.9 $ 30.5 $ 28.5 $ 22.6 $ 33.2 $ 26.4 (b)Adjusted effective 25.7 % 25.5 % 23.0 % 23.5 % 29.6 % 26.2 %tax rate

Three Months Ended Sep 30, Dec 31, Mar 31, Jun 30, Sep 30, Dec 31, 2019 2019 2020 2020 2020 2020Net earnings $ 84.1 $ 24.1 $ 59.5 $ 46.8 $ 58.0 $ 70.1 Less: net earningsattributable to 2.1 1.8 1.9 1.2 2.3 1.8 noncontrollinginterestNet earnings $ 82.0 $ 22.3 $ 57.6 $ 45.6 $ 55.7 $ 68.3 attributable to CDKNet (earnings) lossfrom discontinued (19.2 ) 36.0 17.9 16.0 (10.0 ) (11.3 ) operationsTotal stock-based 3.8 7.2 2.2 6.0 12.3 9.0 compensationAmortization ofacquired intangible 3.8 3.6 3.7 3.8 3.9 4.1 assets (c)Transaction andintegration-related 8.5 ? ? 1.0 ? 1.2 costsLegal and otherexpenses related toregulatory and 7.4 4.8 4.4 2.7 14.0 0.7 competition matters(c)Business processmodernization 4.3 3.3 4.4 4.1 2.9 2.6 programOfficer transition ? ? ? ? 1.1 ? expenseNet adjustmentsrelated to loss ? ? ? 2.2 3.0 1.5 from equity methodinvestmentIncome tax effectof pre-tax (6.2 ) (4.9 ) (3.8 ) (4.9 ) (6.2 ) (3.7 ) adjustmentsIncome tax effectfor foreignearnings previously ? ? 7.0 (4.4 ) ? ? deemed indefinitelyreinvestedChange in valuation ? 14.8 ? ? ? ? allowanceImpact of U.S. tax (0.3 ) ? ? ? ? ? reform actAdjusted netearnings $ 84.1 $ 87.1 $ 93.4 $ 72.1 $ 76.7 $ 72.4 attributable to CDK(a) (b) (c)

Three Months Ended Sep 30, Dec 31, Mar 31, Jun 30, Sep 30, Dec 31, 2019 2019 2020 2020 2020 2020Diluted earningsattributable to CDK $ 0.67 $ 0.18 $ 0.47 $ 0.37 $ 0.46 $ 0.56 per shareNet (earnings) lossfrom discontinued (0.16 ) 0.29 0.15 0.13 (0.08 ) (0.09 ) operationsTotal stock-based 0.03 0.06 0.02 0.05 0.10 0.07 compensationAmortization ofacquired intangible 0.03 0.03 0.03 0.03 0.03 0.03 assets (c)Transaction andintegration-related 0.07 ? ? 0.01 ? 0.01 costsLegal and otherexpenses related toregulatory and 0.06 0.04 0.03 0.03 0.12 0.01 competition matters(c)Business processmodernization 0.04 0.03 0.03 0.03 0.02 0.02 programOfficer transition ? ? ? ? 0.01 ? expenseNet adjustmentsrelated to loss ? ? ? 0.02 0.02 0.01 from equity methodinvestmentIncome tax effectof pre-tax (0.05 ) (0.04 ) (0.03 ) (0.04 ) (0.05 ) (0.03 ) adjustmentsIncome tax effectfor foreignearnings previously ? ? 0.06 (0.04 ) ? ? deemed indefinitelyreinvestedChange in valuation ? 0.12 ? ? ? ? allowanceAdjusted dilutedearningsattributable to CDK $ 0.69 $ 0.71 $ 0.76 $ 0.59 $ 0.63 $ 0.59 per share (a) (b)(c) Weighted-averagecommon shares outstanding:Diluted 122.0 122.1 122.2 122.1 122.3 122.6

Three Months Ended Sep 30, Dec 31, Mar 31, Jun 30, Sep 30, Dec 31, 2019 2019 2020 2020 2020 2020Net earnings $ 82.0 $ 22.3 $ 57.6 $ 45.6 $ 55.7 $ 68.3 attributable to CDKMargin 19.6 % 5.3 % 13.5 % 12.1 % 13.5 % 16.8 %Net earningsattributable to 2.1 1.8 1.9 1.2 2.3 1.8 noncontrollinginterestNet (earnings) lossfrom discontinued (19.2 ) 36.0 17.9 16.0 (10.0 ) (11.3 ) operationsProvision for 23.4 40.4 31.7 13.3 27.0 22.7 income taxesInterest expense 37.7 36.2 35.2 35.0 34.7 34.3 Depreciation and 21.8 22.6 22.3 25.0 23.1 23.4 amortizationTotal stock-based 3.8 7.2 2.2 6.0 12.3 9.0 compensationTransaction andintegration-related 8.5 ? ? 1.0 ? 1.2 costsLegal and otherexpenses related to 7.4 4.8 4.4 2.8 14.0 0.7 regulatory andcompetition mattersBusiness processmodernization 4.3 3.3 4.4 4.1 2.9 2.6 programOfficer transition ? ? ? ? 1.1 ? expenseNet adjustmentsrelated to loss ? ? ? 3.3 4.5 2.8 from equity methodinvestmentAdjusted EBITDA (a) $ 171.8 $ 174.6 $ 177.6 $ 153.3 $ 167.6 $ 155.5 (b)Adjusted margin 41.1 % 41.8 % 41.7 % 40.7 % 40.5 % 38.3 %

(a) Excludes amounts attributable to discontinued operations.(b) Refer to the Non-GAAP Financial Measures section of this press release for additional information on our non-GAAP adjustments.(c)The portion of expense related to noncontrolling interest has been removed from amortization of acquired intangible assets and legal and other expenses related to regulatory and competition matters for the applicable periods.

CDK Global, Inc.Consolidated Fiscal 2021 Guidance(In millions, except per share amounts)(Unaudited)

As described below under the Non-GAAP Financial Measures section of this press release, the fiscal 2021 guidance is provided on both a GAAP and a Non-GAAP basis.The non-GAAP guidance in the table below excludes the International Business results and the expected gain on the sale as these amounts are now reported within discontinued operations. The GAAP revenue also excludes the International Business as the financial results are reported within discontinued operations on a net earnings basis. The table below includes these adjustments for fiscal 2021 guidance.

Fiscal 2021 Point Guidance Estimate (a)Revenue (b) $ 1,685 $1,660 - $1,710 Earnings before income taxes (b) 310 Total stock-based compensation 45 Amortization of acquired intangible assets 15 Transaction and integration-related costs 1 Legal and other expenses related to regulatory 25 and competition mattersBusiness process modernization program 15 Loss from extinguishment of debt 22 Officer transition expense 1 Net adjustments related to loss from equity 10 method investmentAdjusted earnings before income taxes (b)(c) $ 444 Fiscal 2021 Point Estimate Guidance (a)Provision for income taxes (b) $ 92 Effective tax rate 29.7 % 29% - 30%Income tax effect of pre-tax adjustments 26 Adjusted provision for income taxes (b)(c) $ 118 Adjusted effective tax rate 26.6 % 26% - 27% Fiscal 2021 Point Guidance Estimate (a)Net earnings (d) $ 1,018 Less: net earnings attributable to noncontrolling 8 interestNet earnings attributable to CDK $ 1,010 Net earnings loss from discontinued operations (800 ) Total stock-based compensation 45 Amortization of acquired intangible assets 15 Transaction and integration-related expenses 1 Legal and regulatory expenses related to 25 competition mattersBusiness process modernization program 15 Loss from extinguishment of debt 22 Officer transition expense 1 Net adjustments related to loss from equity 10 method investmentIncome tax effect of pre-tax adjustments (26 ) Adjusted net earnings attributable to CDK (b)(c) $ 318 Fiscal 2021 Point Guidance Estimate (a)Diluted net earnings attributable to CDK per $ 8.24 $8.10 -share (d) $8.40Net earnings from discontinued operations (6.53 ) Total stock-based compensation 0.37 Amortization of acquired intangible assets 0.12 Transaction and integration-related expenses 0.01 Legal and regulatory expenses related to 0.21 competition mattersBusiness process modernization program 0.12 Loss from extinguishment of debt 0.18 Officer transition expense 0.01 Net adjustments related to loss from equity 0.08 method investmentIncome tax effect of pre-tax adjustments (0.21 ) Adjusted diluted net earnings attributable to CDK $ 2.60 $2.45 -per share (b)(c) $2.75

Fiscal 2021 Point Guidance Estimate (a)Revenue $ 1,685 $1,660 - $1,710 Net earnings attributable to CDK (d) $ 1,010 $990 - $1,030Margin 59.9 % Net earnings attributable to noncontrolling 8 interestNet earnings from discontinued operations (800 ) Provision for income taxes 92 Interest expense 130 Depreciation and amortization 95 Total stock-based compensation 45 Transaction and integration-related costs 1 Legal and other expenses related to regulatory and 25 competition mattersBusiness process modernization program 15 Loss from extinguishment of debt 22 Officer transition expense 1 Net adjustments related to loss from equity method 16 investmentAdjusted EBITDA (b)(c) $ 660 $640 - $680Adjusted margin 39.2 %

(a) The point estimates are arbitrary amounts in the guidance ranges provided and are not meant to represent CDK's forecast of actual results. They are used solely to provide a means to reconcile each non-GAAP guidance range to the most directly comparable GAAP measure in dollars and percentages, where applicable.

(b) Excludes amounts attributable to discontinued operations.

(c) Refer to the Non-GAAP Financial Measures section of this press release for additional information on our non-GAAP adjustments.

(d) GAAP net earnings attributable to CDK includes the International Business results and an estimate of the gain on sale, subject to the application of customary adjustments, including currency translation, indebtedness and working capital adjustments, which will be reported in discontinued operations upon closing in the third quarter of fiscal 2021.

CDK Global, Inc.Performance Metrics(Unaudited)

CDK management regularly reviews the following key performance measures to evaluate business results and make operating and strategic decisions. These measures are intended to provide directional information regarding trends in our subscription revenue. The following table summarizes these measures for certain subscription revenue.

For the three months ended December March 31, June 30, September December 31, 2020 (a) 2020 (a) 30, 31, 2019 (a) 2020 2020Automotive DMS Customer 8,974 8,948 8,951 8,966 8,997 Sites (b)Avg Revenue $ 8,858 $ 9,009 $ 8,034 $ 8,902 $ 9,005 Per Site (c)Adjacencies DMS Customer 5,802 5,793 5,768 5,804 5,854 Sites (b)Avg Revenue $ 1,764 $ 1,784 $ 1,661 $ 1,799 $ 1,822 Per Site (c)Total CDK DMS Customer 14,776 14,741 14,719 14,770 14,851 Sites (b)Avg Revenue $ 6,076 $ 6,171 $ 5,533 $ 6,114 $ 6,179 Per Site (c)

(a) Average revenue per Dealer Management System (DMS) customer site has been updated for fiscal 2020 to reflect budgeted foreign exchange rates for fiscal 2021.

(b) DMS Customer Sites (end of period) - We track the number of retail customer sites with an active DMS that sell vehicles in the automotive and adjacent markets as an indicator of our opportunity set for generating subscription revenue. We consider a DMS to be active if we have billed a subscription fee for that solution during the last billing cycle in the period presented in the table. Adjacent markets include heavy truck dealerships that provide vehicles to the over-the-road trucking industry, recreation dealerships in the motorcycle, powersports, marine, and recreational vehicle industries, and heavy equipment dealerships in the agriculture and construction equipment industries.

(c) Average Revenue Per DMS Customer Site (monthly average for period) - Average revenue per DMS customer site is an indicator of the scope of adoption of our solutions by DMS customers. We monitor changes in this metric to measure the effectiveness of our strategy to deepen our relationships with our current customer base through upgrading and expanding solutions. We calculate average revenue per DMS customer site by dividing subscription revenue generated from our solutions, in an applicable quarterly period by the monthly average number of DMS customer sites in the same period, divided by three. The metric excludes subscription revenue generated from customers not included in our DMS customer site count as well as subscription revenue related to certain installation and training activities that is deferred then recognized as revenue over the life of the contract. Revenue underlying this metric is based on budgeted foreign exchange rates. When we discuss growth in average revenue per DMS customer site, revenue for the comparable prior period has been adjusted to reflect budgeted foreign exchange rates for the current period.

Non-GAAP Financial Measures

We disclose certain financial measures for our consolidated results on both a GAAP and a non-GAAP basis. The non-GAAP financial measures disclosed should be viewed in addition to, and not as an alternative to, results prepared in accordance with GAAP. Our use of each of the following non-GAAP financial measures may differ from similarly titled non-GAAP financial measures presented by other companies, and other companies may not define these non-GAAP financial measures, or reconcile them to the comparable GAAP financial measures, in the same way.

Non-GAAP Financial Measure Comparable GAAP Financial MeasureAdjusted earnings before income taxes Earnings before income taxesAdjusted provision for income taxes Provision for income taxesAdjusted net earnings attributable to CDK Net earnings attributable to CDKAdjusted diluted earnings attributable to Diluted earnings attributable to CDKCDK per share per shareAdjusted EBITDA Net earnings attributable to CDKAdjusted EBITDA margin Net earnings attributable to CDK marginConstant currency revenue RevenueConstant currency adjusted earnings before Earnings before income taxesincome taxesFree cash flow from continuing operations Net cash flows provided by operating activities

We use adjusted earnings before income taxes, adjusted provision for income taxes, adjusted net earnings attributable to CDK, adjusted diluted earnings attributable to CDK per share, adjusted EBITDA and adjusted EBITDA margin internally to evaluate our performance on a consistent basis, because those measures adjust for the impact of certain items that we believe do not directly reflect our underlying operations. By adjusting for these items we believe we have more precise inputs for use as factors in (i) our budgeting process, (ii) making financial and operational decisions, (iii) evaluating ongoing overall operating performance on a consistent period-to-period basis and relative to our competitors, (iv) target leverage calculations, and (v) determining incentive-based compensation.

We believe our non-GAAP financial measures are helpful to users of the financial statements because they (i) provide investors with meaningful supplemental information regarding financial performance by excluding certain items, (ii) permit investors to view performance using the same tools that management uses, and (iii) otherwise provide supplemental information that may be useful to investors in evaluating our ongoing operating results on a consistent basis. We believe that the presentation of these non-GAAP financial measures, when considered in addition to the corresponding GAAP financial measures and the reconciliations to those measures disclosed below, provides investors with a better understanding of the factors and trends affecting our business than could be obtained absent these disclosures.

We incorporated additional adjustments in our calculations of non-GAAP financial measures where management has deemed it appropriate to better reflect our underlying operations. These adjustments are inconsistent in amount and frequency and do not directly reflect our underlying operations. Therefore, management believes that excluding such information provides us with a better understanding of our ongoing operating performance across periods. Prior period information has been revised to conform to the new presentation.

Adjusted Earnings before Income Taxes

Management has excluded the following items from adjusted earnings before income taxes for the periods presented:

-- Total stock-based compensation expense included in cost of revenue and selling, general and administrative expenses. -- Amortization of acquired intangible assets consists of non-cash amortization of intangible assets such as customer lists, purchased software, and trademarks acquired in connection with business combinations. We exclude the impact of amortization of acquired intangible assets because these non-cash amounts are significantly impacted by the timing and size of individual acquisitions and do not factor into our budgeting process, financial and operational decision making, target leverage calculations, and determination of incentive based pay. Furthermore, management believes that this adjustment enables better comparison of our overall operating results as amortization of acquired intangibles will not recur in future periods once such intangible assets have been fully amortized. Although we exclude amortization of acquired intangible assets from our presentation of adjusted earnings before income taxes, adjusted provision for income taxes, adjusted net earnings attributable to CDK, and adjusted diluted net earnings attributable to CDK per share, we believe that it is important for the users of the financial statements to understand that the associated intangible assets were recorded as part of purchase accounting and contribute to revenue generation. Amortization of intangible assets that relate to past acquisitions will recur in future periods until such intangible assets have been fully amortized. Any future acquisitions may result in the amortization of additional intangible assets. -- Transaction and integration-related costs include: (i) legal, accounting, outside service fees, and other costs incurred in connection with assessment and integration of acquisitions and other strategic business opportunities; and (ii) post-close adjustments to acquisition-related contingent consideration, included in cost of revenue and selling, general and administrative expenses. -- Legal and other expenses, related to regulatory and competition matters included in selling, general and administrative expenses, and litigation provision. -- Business process modernization program designed to improve the way we do business for our customers through best-in-class product offerings, processes, governance and systems. The business process modernization program will include a comprehensive redesign in the way we go to market, including the quoting, contracting, fulfilling, and invoicing processes, and the systems and tools we use. The investment to implement this holistic business reform, including the design and implementation of a new ERP system, which began in the first quarter of fiscal 2020, will be completed over a three-year time horizon. The expense is included in cost of revenue and selling, general and administrative expenses. -- Officer transition expense includes severance expense in connection with officer departures included in cost of revenue and selling, general and administrative expenses. -- Net adjustments related to earnings (loss) from equity method investment includes certain portions of Ansira earnings attributable to the equity interest owned by CDK included in earnings (loss) from equity method investment.

Adjusted Provision for Income taxes

Management has excluded the following items from adjusted provision for income taxes for the periods presented:

-- Income tax effect of pre-tax adjustments calculated at applicable statutory rates net of applicable permanent differences. -- True up of income tax expense for cumulative withholding tax associated with historical foreign earnings that are no longer considered indefinitely reinvested as of March 31, 2020. The change in assertion was made in this quarter in response to the uncertainty related to the COVID 19 pandemic and its potential impact on CDKs liquidity needs. -- Increase in valuation allowance associated with a deferred tax asset for a capital loss carryforward which the Company does not expect to utilize. -- In fiscal 2020, a one-time tax benefit for an adjustment of an accrual for foreign withholding taxes related to undistributed earnings as a result of the Tax Reform Act.

Adjusted Net Earnings Attributable to CDK and Adjusted Diluted Net Earnings Attributable to CDK per Share

For each respective presentation, management has excluded earnings (loss) from discontinued operations, net of taxes associated with the Company's divestiture of the Digital Marketing Business which closed on April 21, 2020 and the expected sale of the International Business in the third quarter of fiscal 2021, in addition to the items described above for adjusted earnings before income taxes and adjusted provision for income taxes from adjusted net earnings attributable to CDK and adjusted diluted net earnings attributable to CDK per share.

The portion of expense related to noncontrolling interest has been removed from amortization of acquired intangible assets and legal and other expenses related to regulatory and competition matters for the applicable periods.

Adjusted EBITDA

Management has excluded the following items from net earnings attributable to CDK in order to calculate adjusted EBITDA for the periods presented:

-- Net earnings attributable to noncontrolling interest included in the financial statements. -- Net earnings from discontinued operations, net of taxes associated with the Company's divestiture of the Digital Marketing Business which closed on April 21, 2020 and the expected sale of the International Business in the third quarter of fiscal 2021 included in the financial statements. -- Provision for income taxes included in the financial statements. -- Interest expense included in the financial statements. -- Depreciation and amortization expense included in the financial statements. -- Total stock-based compensation expense included in cost of revenue and selling, general and administrative expenses. -- Transaction and integration-related costs include: (i) legal, accounting, outside service fees, and other costs incurred in connection with assessment and integration of acquisitions and other strategic business opportunities and (ii) post-close adjustments to acquisition related contingent consideration, reported in cost of revenue and selling, general and administrative expenses. -- Legal and other expenses, related to regulatory and competition matters included in selling, general and administrative expenses and litigation provision. -- Business process modernization program designed to improve the way we do business for our customers through best-in-class product offerings, processes, governance and systems. The business process modernization program will include a comprehensive redesign in the way we go to market, including the quoting, contracting, fulfilling, and invoicing processes, and the systems and tools we use. The investment to implement this holistic business reform, including the design and implementation of a new ERP system, which began in the first quarter of fiscal 2020, will be completed over a three-year time horizon. The expense is included in cost of revenue and selling, general and administrative expenses. -- Officer transition expense includes severance expense in connection with officer departures included in cost of revenue and selling, general and administrative expenses. -- Net adjustments related to loss from equity method investment included certain portions of Ansira earnings attributable to the equity interest owned by CDK included in loss from equity method investment.

Free Cash Flow

We also review free cash flow from continuing operations as a measure of our ability to generate additional cash from our business operations. Free cash flow from continuing operations is defined as cash flow from operating activities less net cash flows used in operating activities attributable to discontinued operations, amounts paid for capital expenditures and capitalized software and change in restricted cash. Free cash flow from continuing operations should be considered in addition to, rather than as a substitute for consolidated net income as a measure of our performance and net cash provided by operating activities as a measure of our liquidity.

The change in restricted cash is funds held for clients before remittance to agencies for titling and registration services on behalf of those clients.

Constant Currency

We use constant currency revenue and constant currency adjusted earnings before income taxes to review revenue and adjusted earnings before income taxes for our consolidated results on a constant currency basis to understand underlying business trends. To present these results on a constant currency basis, current period results for entities reporting in currencies other than the U.S. dollar were translated into U.S. dollar using the average monthly exchange rates for the comparable prior period. As a result, constant currency results neutralize the effects of foreign currency.