July / August 2010 July / August 2010 Overview Experian investment - - PDF document
July / August 2010 July / August 2010 Overview Experian investment highlights Experian investment highlights Unique combination of data & analytics Global leader with high barriers to entry Global leader with high barriers to entry
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Global continuing sales and EBIT only Global continuing sales and EBIT only Growth at constant exchange rates and for continuing activities EBIT margin excluding FARES FY06 and FY07 sales and EBIT adjusted to exclude MetaReward. FY06, FY07, FY08, FY09 and FY10 sales and EBIT adjusted to exclude UK account processing, FY07 and FY08 sales and EBIT adjusted to exclude Loyalty Solutions, FY08 and FY09 sales and EBIT adjusted to exclude French transaction processing activities and
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1,200 Operating cash flow as a percentage
800 1,000 percentage
97% 98% 99% 98%
600 800
Free cash flow* Operating cash flow
200 400 FY10 FY09 FY08 FY07
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* Free cash flow is defined as operating cash flow less net interest, tax paid and dividends paid to minority shareholders.
8%
Lehman collapse
6% 7% 8%
Credit crunch collapse
4% 5%
Organic revenue growth
2% 3%
growth
0% 1% FY09 FY10 FY08 Q1 FY08 Q2 FY08 Q3 FY08 Q4 FY09 Q1 FY09 Q2 FY09 Q3 FY09 Q4 FY10 Q1 FY10 Q2 FY10 Q3 FY10 Q4 FY11 Q1 5
Note: Growth shown is for continuing activities
EMEA /AP
Revenue by geography Revenue by business line
/AP 12% UK and Ireland 20% North America 53% Interactive 27% Credit Services 43% Marketing Latin America 15% g Services 19% Decision Analytics 11% 10% 5% Retail 14%
Other Public Sector/education Telecoms/utilities
Other 9% 2%
Central activities
Revenue by vertical Cost profile
3% 3% 5% 14% Direct to Consumer 19% Financial 5%
Telecoms/utilities Automotive Insurance Media
Labour 52% Data 14% Marketing 16% services 36% IT 7% 14%
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Global continuing revenue to 31 March 2010
4 000
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3 000 3,500 4,000
Other regions North America
3,8591
3,000 2 000 2,500
$m
47% 1 8252 23% 9% 14%
2,000 1,000 1,500
evenue US$
1,0991 1,6872 22% 1,825 19% 14% 8602 55% 67%* 33% 77%* 80% 91%* 9% 86%*
500 ,
Global re
53% 6313 68% * 32% 78% 81% 86% * 14% 90% * 10% 860 Experian Equifax D&B Acxiom Harte- Hanks FICO
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Source: Latest full year revenue, company 10K * US only 1 Year ended 31 March 2010 2 Year ended 31 December 2009 3 Year ended 30 September 2009
Vital statistics 16 consumer credit bureaux l b ll Credit application and payment history data on consumers and businesses: Overview globally 12 business credit bureaux globally Automotive information in US, UK, Holland and Italy businesses:
Holland and Italy Business model Financial services, telecoms, utilities, insurance, government, automotive dealers and others Clients Business model Transactional Volume-tiered pricing Habitually recurring revenue Credit reports to target new customers, underwrite new loans, manage account portfolios and collect on
Products Habitually recurring revenue
Vehicle history information and accident data
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693 (5)% (6)% 730 Revenue North America
693 234 191 (5)% (6)% 8% (6)% (6)% 0% 30 265 172 538 17% 17% 437 UK and Ireland EMEA/Asia Pacific Latin America
191 1,656 8% 2% 0% 1% 172 1,604 Total EBIT
di t b i
555 7% 513 EMEA/Asia Pacific Total revenue Total EBIT – direct business FARES Total EBIT 555 56 611 7% 16% 8% 513 48 561
All fi b i i b i
EBIT margin 33.5% 32.0%
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All figures above on continuing basis Growth at constant exchange rates EBIT margin is for continuing business only, excluding FARES 2009 restated to exclude small discontinuing activity in North America
Combines analytics, software, fraud prevention tools and consulting to help Overview Vital statistics Delivered into over 90 countries ld id tools and consulting to help clients better manage risk Financial services, telecoms, utilities government and Clients worldwide Build over 300 scorecards p.a. Over 1,500 systems deployed worldwide utilities, government and
Credit risk and fraud analytics (e g scoring) worldwide Clients often standardise lending
Business model Products analytics (e.g. scoring) Application processing, customer management and collections software Part transactional revenue Part software licence and implementation fees Fraud and identity solutions Habitually and contractually recurring revenue
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116 (3)% (3)% 119 Revenue North America
193 125 ( )% (8)% (5)% ( )% (8)% (5)% 226 131 7 (26)% (26)% 10 UK and Ireland EMEA/Asia Pacific Latin America
EBIT 125 441 (5)% (7)% (5)% (7)% 131 486 119 (11)% 140 EMEA/Asia Pacific Total revenue EBIT margin 27.0% 28.8%
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All figures above on continuing basis Growth at constant exchange rates 2009 restated to exclude small discontinuing activity in UK & Ireland
Provision of online credit monitoring services, credit scores and identity theft Consumer Direct Vital statistics c.10m members in US and UK for dit it i i scores and identity theft prevention products to consumers Online lead generation and
credit monitoring services Recent US launch of identity protection services Other
services Consumers for credit reference and identity monitoring products Customers Business model monitoring products Businesses and retailers for lead generation and price comparison Membership subscriptions in consumer direct Pay per lead or referral
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922 8% 8% 852 Revenue North America
UK and Ireland Total revenue 109 38% 11% 38% 84 936 1,031 11%
EBIT EBIT margin 242 23.5% 15% 212 22.6%
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All figures above on continuing basis Growth at constant exchange rates 2009 restated to exclude small discontinuing activity in North America
Vital statistics Migration from traditional to newer di h l Consumer data: demographic, geographic, purchasing and media Overview media channels
new media activities Global deployment purchasing and media preference data Platforms: technology platforms to enable delivery
Global deployment Business model Part transactional revenue
across multiple channels Analytics: predictive modelling Part data license and subscription fees Habitually and contractually recurring revenue Retail, financial services, media, telecoms and other Clients recurring revenue
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358 329 (8)% (8)% Revenue North America
358 3 9 243 145 (8)% (4)% 16% (8)% (2)% 8% 268 123 14 (13)% (13)% 15 UK and Ireland EMEA/Asia Pacific Latin America
145 731 16% (3)% 8% (4)% 123 764 86 0% 88 EBIT EMEA/Asia Pacific Total revenue
11.8% 11.5% EBIT margin
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All figures above on continuing basis Growth at constant exchange rates 2009 restated to exclude small discontinuing activities in UK & Ireland
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33.2
45.0
110.4
136.8
45%
18 Source: Central Banks – 2008. Brazil - 2009
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Vertical markets Geographic markets
Gradual recovery in core markets Underpenetrated channels Invest in data
FY10 organic
core markets Invest in data and analytics Superior execution
revenue growth
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2.2x
3,500
1.8x 2.1x
3,000 2,500
2,000 1,500
1,000 500
Mar 08 Mar 09 Mar 10 Sep 08 Sep 09
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1 Valuation at 31 March 2010
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* Continuing activities at constant currency
Revenue North America 2,060 0% 0% 2,059
1% UK and Ireland EMEA/Asia Pacific , 779 461 (1)% 6% (1)% , 843 426 Latin America 559 16% 16% 462
1% 2% EMEA/Asia Pacific Total revenue 461 3,859 6% 2% 426 3,790 EBIT before Central Activities 1,002 6% 953
EBIT – direct business FARES 940 56 5% 16% 896 48 Central Activities (62) (57) EBIT – continuing activities EBIT margin 996 24.4% 6% 944 23.6%
All fi b i i b i
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All figures above on continuing basis Growth at constant exchange rates EBIT margin is for continuing business only, excluding FARES 2009 restated to exclude small discontinuing activities in North America and UK & Ireland
10% 10% 80%
45% 33% Credit Services Consumer information 16% 6% Marketing Services Interactive Decision Analytics Automotive Business information
Approximate % of NA Credit Services Pre screen <15%
16%
Pre-screen <15% Mortgage <10% Account management and collections >20%
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30% 14% 12%
30% Consumer information 50% Credit Services 25% 31% Automotive Business information 38% Marketing Services Interactive Decision Analytics
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Depreciation and amortisation Capital expenditure Working capital (17) Retained 11 Net interest (68) Dividends to minority (314) 275 in associate 11 ( ) Tax (48) to minority interests (42) 25 Sale of fixed assets 991 976
98% i
818
120% i
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98% conversion
flow 120% conversion
earnings into free cash flow
Free cash flow Operating cash flow EBIT
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(135) (62) Net purchase of shares for equity incentive plans (56) ( ) 161 (206) 818 Foreign exchange and
Dividend (114) Acquisitions 118 (52) (2,110) (1,627) (62) (19) Exceptional cash outflow Free cash flow (114) Acquisitions and disposals FARES disposal Net debt at 1 April 2009 Net debt at 31 March 2010
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6% 939
(96)
991
(81)
Total EBIT Net Interest
8% 843
(184)
659
( )
910
(184)
726
( ) Benchmark taxation Benchmark PAT Benchmark PBT1
1,015 1,013 8%
(28)
631
(45)
681
Weighted average number of shares Benchmark minority interest Benchmark earnings
1,015 1,013
Weighted average number of shares Dividend per share, US cents Benchmark EPS, US cents
23.0 67.1 62.3 20.0 8% 15%
p ,
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Growth at actual exchange rates 1 Benchmark PBT is defined as profit before amortisation of acquisition intangibles, goodwill impairments, charges in respect
the Group’s share of associates’ pre-tax profit.
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Experian
15% 17%
Experian Equifax
19% 49% 17%
ACSP Other
5%
11% 22% 62%
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1 Share of credit reference market Source: Serasa Experian estimates
NA & UK Financial Services revenue in Consumer Information Rest of Experian global revenue
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Based on total revenues for year ended 31 March 2010
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Experian Cardinal Place 80 Victoria Street London London SW1E 5JL Tel: +44 (0)203 042 4200 Website: www.experianplc.com Website: www.experianplc.com Paul Brooks Nadia Ridout-Jamieson Chief Financial Officer Director of Investor Relations Email: paul.brooks@experian.com Email: nadia.rjamieson@experian.com Email: paul.brooks@experian.com Email: nadia.rjamieson@experian.com Peg Smith Sarah Schibli Executive Vice-President Investor Relations Analyst Executive Vice President Investor Relations Analyst Email: peg.smith@experian.com Email: sarah.schibli@experian.com
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presentation may lawfully be communicated (“relevant persons”). Any person who is not a relevant person should not act or rely on this presentation or any of its contents.
bo ght or sold in the past or the ield on s ch in estments cannot be relied pon as a g ide to bought or sold in the past or the yield on such investments cannot be relied upon as a guide to the future performance of such investments.
person to underwrite, subscribe for or otherwise acquire securities in any company within the E i (th “G ”) Experian group (the “Group”).
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 expressed or implied in these forward-looking statements. Forward-looking statements p p g g speak only as of the date of this presentation.
believes that these measures provide valuable additional information in understanding the performance of the Group or the Group’s businesses because they provide measures used by the Group to assess performance. Although these measures are important in the management of the Group to assess performance. Although these measures are important in the management of the business, they should not be viewed as replacements for, but rather as complementary to, the GAAP measures.
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