Experian a portfolio of opportunities June 2006 This presentation - PDF document

Experian – a portfolio of opportunities June 2006 This presentation is not an offer of securities for sale in any jurisdiction. Any shares to be issued in Experian have not been and will not be registered under the US Securities Act of 1933 (the “Securities Act”) and may not be offered or sold within the United States absent registration under the Securities Act or an exemption from registration. No public offering of such shares will be made in the United States. Certain statements made in this presentation are forward looking statements. Such statements are based on current expectations and are subject to a number of risks and uncertainties that could cause actual events or results to differ materially from any expected future events or results referred to in these forward looking statements. 2

Experian - contents • Overview • Growth drivers in the UK • International opportunities • Experian North America • Experian Interactive • Appendix 3 Experian Experian is a global leader in providing information solutions to organisations and consumers We help organisations find, develop and manage profitable customer relationships; with information, decision-making solutions and processing services We empower consumers to understand, manage and protect their personal information and assets 4

Experian – helping organisations Enables m ajor banks to reduce bad debt losses Helps retailers to grow custom er loyalty and cross-sell new products Prevents fraud for online retailers 5 Experian – helping consumers Enabled 4 4 m illion US consum ers to refinance their m ortgage Helps a m obile phone com pany to offer the right services to its 1 3 m users Told over 8 m consum ers by text and e-m ail about changes to their credit report 6

Experian - what we do I nform ation is the foundation of our business Catalogue Consumer Business Vehicle Insurance Consumer purchasing credit credit histories databases marketing habits 300m plus c. 25m c. 500m c. 30m c. 105m US c. 120m consumers businesses vehicles policies households households I NFORMATI ON Credit Marketing 7 Experian - what we do Solutions add value to the inform ation SOLUTI ONS Application Classifying Econom ic Scoring Customer Fraud and consumers analysis and data prevention account and and decisions integration processing businesses forecasting Transact Strategy Hunter Business / Autoscore Truvue Mosaic Manager / Detect Strategies / GEMS I NFORMATI ON Credit Marketing 8

Experian – balanced portfolio North I nternational Am erica 4 2 % 5 8 % I nteractive I nteractive 2 0 % 2 0 % Outsourcing Outsourcing I nform ation Credit 8 % 8 % 4 0 % 4 7 % Marketing Solutions 2 5 % 3 2 % Sales – 12 months to 31 March 2006 9 Continuing activities Experian – how we are paid I nform ation Volume-based contracts Solutions Value-based long-term contacts Outsourcing Cost-plus long-term contracts I nteractive Subscriptions; pay-per-lead 10

Experian – broad offering % of sales by vertical m arket • Over 50,000 clients in more than 60 countries Other 6% Publishing/ media 3% Financial Government 3% services • Top 10 clients account for about Automotive 3% 55% 25% of sales Telecom/ utilities/ insurance 7% • At least 85% of top 50 clients Retail/ bought from Experian for over home shopping 11% five years Direct-to- Clients include: consumer • AOL Time Warner • MBNA 12% • BNP Paribas • McDonald’s • Barclays • Microsoft Year to March 2 0 0 6 • Citigroup • Morgan Stanley • Ford • Orange • HBOS • Société Générale 11 Experian – competitive strength No single com petitor offers as m any products and solutions in as m any countries Global sales revenue $ 3 .1 bn $ m North America I nternational 2 0 x 1 9 x 2 8 x 2 0 x 1 6 x Experian D&B Equifax Acxiom Harte-Hanks Fair, Isaac Mar 06 Dec 05 Dec 05 Mar 06 Dec 05 Sep 05 All figures are for last full year of actuals Source: Company accounts Number on top of bar represents prospective PE rating I/ B/ E/ S estimates Exchange rate £1: $1.79 12

Broad portfolio – cross-selling opportunities • HSBC already a major global client for Experian • Recently signed global multi-million pound, multi-year deal for Strategy Management software, initially in 22 countries • Experian will enable up to 50bn customer decisions annually • Contract won due to – High quality product – Global reach of Experian – Strength of existing relationship with Experian 13 Experian – strong financial performance Sales EBI T £ m £ m 3 1 6 4 1 7 1 ,1 1 5 1 ,2 0 1 1 ,2 8 6 1 ,3 3 2 1 ,7 2 2 2 2 4 2 5 6 2 8 2 + 2 9 % + 2 7 % + 1 6 % + 1 8 % + 2 0 % + 1 4 % + 2 0 % + 1 2 % 2002 2003 2004 2005 2006 2002 2003 2004 2005 2006 Year to March Year to March 14

Experian – strong cash flow 400 100% 350 300 75% 250 £m 200 50% 150 100 25% 50 0 0% 2001 2002 2003 2004 2005 2006 Year to March Operating cash flow (LHS) Operating cash flow as % of EBIT (RHS) Operating cash flow is defined as EBIT plus depreciation and amortisation, less capex, plus change in working capital and associates 15 Experian – acquisition strategy • Organic growth accelerated in last four years • Acquisitions are key part of growth strategy • Often small; always complementary; bringing – Data – New products – Geographical expansion – Vertical market expansion – Consolidation – Cross-selling opportunities • Must generate double-digit post-tax returns over time 16

Experian - key growth drivers • Growth in online advertising • Increase in consumer credit and card usage • Move to multi-channel marketing • Growth in fraud prevention • Growth in demand for information in new sectors, e.g. automotive, insurance, business-to-business, government • Growth in emerging markets 17

Growth drivers in the UK Experian International – growth record CAGR of 1 9 % sales and 2 2 % EBI T £m £m 900 160 800 140 700 120 600 100 500 80 400 60 300 40 200 20 100 0 0 '93 '94 '95 '96 '97 '98 '99 '00 '01 '02 '03 '04 '05 '06 Year to March Sales (LHS) EBIT (RHS) 20

Experian International • Founded in 1980 • Strong organic growth • Supported by complementary acquisitions Rest of W orld* UK 4 1 % 5 9 % • Wide product range • Wide geographic reach Sales Year to March 2 0 0 6 * Continental Europe, Eastern Europe, South Africa, Latin America, Asia Pacific. France is c.55% of ROW 21 Experian in UK - total solutions provider • Clear market leader in Information and Solutions • Grown to offer widest range of services in any one country • Principal credit information supplier to nine of the top ten UK banks • Future growth driven by – Deeper client relationships, e.g. HBOS – Product innovation, e.g. authentication; fraud detection – New sectors, e.g. government; business-to business; direct-to-consumer 22

UK consumer credit growth slowing Gross lending grow th slow ed, but som e offset as client spend shifts from acquiring custom ers to m anaging existing accounts 25 20 15 annual % change Net lending 10 5 Gross lending 0 2006F 2007F 2008F 2009F 2010F 1996 2001 1995 1997 1998 1999 2000 2002 2003 2004 2005 -5 Source: Bank of England; Experian Business Strategies forecasts 23 Experian in UK - HBOS contract • Over £40m five-year contract • Experian offers a unique combination of services – Credit I nformation • Consumer and business lending – Credit Solutions • Application processing/ scoring solutions • Fraud prevention capabilities • Consumer and business authentication – Marketing Information • Analysis and consultancy support – Marketing Solutions • Database hosting • Outsourced data processing • Experian selling new products, such as fraud prevention • Experian supporting HBOS across its product groups, e.g. mortgage, credit cards 24

Fraud Fraud is a grow ing global issue • Total fraud losses in US are $150bn - $115bn in healthcare and insurance, $13bn in financial services and $13bn borne by merchants (Experian) • Total UK fraud losses of £20bn in 2003 (Fraud Advisory Panel) • Global credit card fraud estimated at $4bn (Juniper Bank) • Online fraud cost US merchants $2.6bn or 2% of sales in 2004 (CyberSource) • Between $600bn and $1.5 trillion is money-laundered globally each year (UN Office of Drug Control and Crime Prevention) Experian offers global solutions 25 Fraud prevention – saving clients money • Hunter: identifies at the application stage fraudulent new accounts or claims • Global solution: standalone or web- based • Immediate benefits – £3m per month for a major bank – £1.5m per month for a large building society – £1m plus per month for a medium-sized mortgage lender – £1m per month for a major motor finance organisation – £0.5m per month for an Internet bank 26