S&p Global Inc. · NYSE:SPGI
S&p Global — Q2 2023 Earnings Presentation
34 slides from S&p Global's earnings presentation, Jul 27, 2023
Slide 1: S&P Global Quarterly Update 2Q 2023
2Q 2023 S&P Global Quarterly Update July 27, 2023 1
Slide 2: Safe Harbor statement under the Private Securities Litigation Reform Act of 1995
Safe Harbor statement under the Private Securities Litigation Reform Act of 1995 This presentation contains “forward-looking Forward-looking statements are subject to inherent risks and uncertainties. Factors that could cause actual results to differ materially from those expressed or implied in for
Slide 3: Comparison of adjusted information to U.S. GAAP information
Comparison of adjusted information to U.S. GAAP information This presentation includes Company financials on an as-reported basis, and on a pro forma basis as if The Company’s non-GAAP measures include adjustments that reflect how management views our the merger had closed on January 1, 2021, for pe
Slide 4: EU regulation affecting investors in credit rating agencies
EU regulation affecting investors in credit rating agencies European Union Regulation 1060/2009 (as amended) applies to credit rating agencies Any person obtaining direct or indirect ownership or control of 5% or more or 10% (CRAs) registered in the European Union (“EU”) and therefore to the activit
Slide 5: Quarterly Update Call Presenters
Quarterly Update Call Presenters Doug Ewout Mark Peterson Steenbergen Grant President and CEO Executive Vice Senior Vice President, President and CFO Investor Relations 5
Slide 6: Strategy, Vision, and Execution
Strategy, Vision, and Execution Doug Peterson President and CEO 6
Slide 7: Second quarter highlights
Second quarter highlights Financial highlights 1 Additional highlights Adjusted revenue, excluding Engineering Solutions Developing comprehensive strategy around Generative increased 7% year over year, with positive revenue AI, both for commercial products and internal growth in all five other divis
Slide 8: Customer at the Core, Grow & Innovate, Lead & Inspire
Customer at the Core Grow & Innovate Data & Technology Lead & Inspire Execute & Deliver 8
Slide 9: Customer confidence beginning to stabilize
Customer at the Core Customer confidence beginning to stabilize Commercial conditions Customer value Stabilization in sales cycles, High retention rates and contract early signs of adjusting to expansions drive 8% subscription current market conditions revenue growth, ex-Eng. Solutions Strategic ali
Slide 10: Ratings issuance returns to positive growth
Customer at the Core Ratings issuance returns to positive growth Billed issuance up 8% Updates on market conditions ($ in billions) $690 Some signs of stabilizing central $639 bank policy rates $318 $270 Issuance impacted by higher level $44 $75 of refinancing activity Investment Grade High-Yield $3
Slide 11: Continued investment to drive innovation
Grow & Innovate Continued investment to drive innovation Product development1 Key contributors of Vitality revenue Vitality revenue RatingsDirect reinvented on Capital IQ Pro CARFAX Used Car Listings Vitality revenue (Mobility) Launched Loan Pricing and grew 14% and Energy Transition and Analytics o
Slide 12: Comprehensive strategic vision for AI
Data & Technology Comprehensive strategic vision for AI Key competitive advantages Principles governing our AI strategy Data - Proprietary and differentiated data sets that Customer at the Core – invest and build features, span equity, fixed income, and commodity markets tools, and products that acc
Slide 13: Continued commitment to leadership by example
Lead & Inspire Continued commitment to leadership by example Transparency and accountability External Recognition 100 Most Sustainable Companies Just 100 Issued 12th annual Sustainability Barron’s / 2020-2023 Just Capital / 2019, 2021-2023 Impact report1 The Civic 50 Bloomberg Gender-Equality Index
Slide 14: Revenue growth across all five divisions
Execute & Deliver Revenue growth across all five divisions 1 2Q23 Revenue TTM Adjusted TTM Adjusted Financial Performance Growth 2 Operating Margin 3 Operating Margin Y/Y 3 +6% 32.4% +220 bps +7% 55.2% (460) bps +8% 45.5% +220 bps +10% 38.9% (60) bps +3% 68.3% (30) bps Total S&P Global +4%4 45.0% (9
Slide 15: 2023 economic factors facing the Company
2023 economic factors facing the Company Macroeconomic Environment: + Global supply chain alleviation – Economic slowdown, no global recession +/– Uncertainty in banking end market Equity Markets: + Continued flows from active to passive +/– Sustained heightened volatility Difficult year-over-year c
Slide 16: 2023 debt issuance outlook improves
2023 debt issuance outlook improves S&P Global Ratings +4% +8% billed issuance assumption Global market -8% +5% issuance forecast1 -1.5% Forecast S&P Global Ratings billed issuance includes Global market issuance forecast is a the impact of levered loans, and excludes product of the S&P Global Ratin
Slide 17: July 2023 Global Refinancing Study
July 2023 Global Refinancing Study Long-term confidence in Ratings growth bolstered by strong multi- year pipeline of debt maturities ($ in billions) $3,000 $2,500 As of 7/1/2022 $2,000 As of 1/1/2023 $1,500 As of 7/1/20231 $1,000 $500 $0 2023.2H 2024 2025 2026 2027 2028 2029 2030 2031 1. For the re
Slide 18: Financial Strategy and Guidance
Financial Strategy and Guidance Ewout Steenbergen Executive Vice President and CFO 18
Slide 19: Second quarter enterprise financial results
Second quarter enterprise financial results Revenue 1 Adjusted Operating Profit & Expense 1, 2 ($ in millions) ($ in millions) y/y y/y $3,101 $2,970 $3,101 $2,970 $347 3% $338 $369 10% $337 $1,432 2% $1,402 Indices $427 $462 8% Mobility 45.2% 41.2% Commodity Insights Adjusted Operating Profit 47.2%
Slide 20: Continued growth in strategic investment areas
Continued growth in strategic investment areas Sustainability & Private Market Vitality Energy Transition 1 Solutions 2 Revenue 3 ($ in millions) ($ in millions) ($ in millions) +17% +5% +14% $70 $106 $343 $101 $60 $301 Vitality 11.2% 10.5% Index4 2Q '22 2Q '23 2Q '22 2Q '23 2Q '22 2Q '23 Note: Cate
Slide 21: Delivering on cost and revenue synergies
Delivering on cost and revenue synergies Cost Synergies Revenue Synergies ($ in millions) ($ in millions) Targeting $600 million Targeting $350 million run-rate in 2023 run-rate in 2026 $350 $600 $574 Targeting 85% achieved Targeting 45% achieved in 2023 in 2024 $68 Achievement through 2Q23 Target R
Slide 22: 2022 expense cuts create difficult y/y margin comparison
2022 expense cuts create difficult y/y margin comparison Total Adjusted Expenses1 ($ in millions) $1,669 $1,568 2Q2022 2Q2023 1. Refers to non-GAAP adjusted expenses in the current period and the year-ago period 22
Slide 23: S&P Global Market Intelligence
S&P Global Market Intelligence Revenue 1 Adjusted Operating Profit & Expense 1, 2 ($ in millions) ($ in millions) y/y y/y $1,020 $1,079 $1,020 $1,079 $349 4% $270 4% $336 $260 33.0% 32.3% Desktop $336 7% Data & Advisory Solutions $315 Adjusted Operating Profit 7% Enterprise Solutions Adjusted Expens
Slide 24: S&P Global Ratings
S&P Global Ratings Revenue Adjusted Operating Profit & Expense 2 ($ in millions) ($ in millions) y/y y/y $851 $851 $796 $796 $125 8% $116 $68 3% $65 $89 (8)% $491 4% CRISIL, Other 1 $97 $473 Governments $140 2% $138 Structured Finance Adjusted Operating Profit 59.5% 57.7% Financials Adjusted Expense
Slide 25: S&P Global Commodity Insights
S&P Global Commodity Insights Revenue 1 Adjusted Operating Profit & Expense 1, 2 ($ in millions) ($ in millions) y/y y/y $427 $462 $427 $462 $40 12% $36 (2)% $98 $211 Advisory and $100 $188 12% Transactional Services Upstream Data and Insights 12% 45.6% $160 Adjusted Operating Profit 44.0% $143 Pric
Slide 26: S&P Global Mobility
S&P Global Mobility Revenue Adjusted Operating Profit & Expense 1 ($ in millions) ($ in millions) y/y y/y $369 $369 $337 $337 $63 9% $58 $149 5% $141 $84 5% $80 41.9% 40.3% Financials and Other Adjusted Operating Profit Manufacturing Adjusted Expense $221 13% $196 Dealer Adjusted Operating Margin $1
Slide 27: S&P Dow Jones Indices
S&P Dow Jones Indices Revenue 1 Adjusted Operating Profit & Expense 1, 2 ($ in millions) ($ in millions) y/y y/y $338 $348 $338 $348 $67 $70 3% Data & Custom $57 $67 17% $238 (2)% Subscriptions $243 Exchange-Traded Adjusted Operating Profit 71.9% 68.6% Derivatives Adjusted Expense Asset-Linked Fees
Slide 28: 2023 macroeconomic assumptions underlying guidance
2023 macroeconomic assumptions underlying guidance Real GDP United States Brent Crude 3 Global Market Growth 1 CPI 2 Debt Issuance 4 +2.9% +4.3% $80 -1.5% Global Average Per Barrel Range -8% to +5% United States +1.7% Eurozone +0.6% China +5.2% 1 S&P Global Ratings Economic Research - Global Economi
Slide 29: 2023 GAAP guidance (unchanged from prior)
2023 GAAP guidance (unchanged from prior) Revenue Growth 10% - 12% Operating Profit Margin 34.0% - 35.0% Diluted EPS $8.65 - $8.85 29
Slide 30: 2023 adjusted guidance (unchanged from prior)
2023 adjusted guidance (unchanged from prior) Adjusted 1 Actual Contribution from ES Revenue Growth 4% - 6% $133 million Operating Profit Margin 45.5% - 46.5% Diluted EPS2 $12.35 - $12.55 1. Expected growth compares 2023 revenue to 2022 pro forma and non-GAAP pro forma adjusted revenue, and includes
Slide 31: Updated 2023 division revenue outlook
Updated 2023 division revenue outlook Previous 2023 Current 2023 Revenue Growth 1 Revenue Growth 1 6.5% - 8.5% 6.0% - 8.0% 4.0% - 6.0% 5.0% - 7.0% 7.5% - 9.5% 7.5% - 9.5% 8.5% - 10.5% 8.5% - 10.5% 1.0% - 3.0% 2.0% - 4.0% Indicates a change from prior guidance 1. For Market Intelligence, Commodity In
Slide 32: Updated 2023 division operating margin outlook
Updated 2023 division operating margin outlook Previous 2023 Adjusted Current 2023 Adjusted Operating Operating Profit Margin Outlook 1 Profit Margin Outlook 1 34.0% - 35.0% 33.5% - 34.5% 56.0% - 57.0% 56.0% - 57.0% 46.0% - 47.0% 46.0% - 47.0% 38.5% - 39.5% 38.5% - 39.5% 67.0% - 68.0% 67.5% - 68.5%
Slide 33: 2Q 2023 Earnings Call
2Q 2023 Earnings Call Doug Peterson Edouard Tavernier President and CEO President, S&P Global Mobility Ewout Steenbergen Executive Vice President and CFO Mark Grant Senior Vice President, Investor Relations July 27, 2023 33
Slide 34: 2Q 2023 Earnings Call
2Q 2023 Earnings Call Doug Peterson REPLAY OPTIONS President and CEO Internet: Replay available for one year Ewout Steenbergen Go to http://investor.spglobal.com Executive Vice President and CFO Mark Grant Telephone: Replay available through August 26, 2023 Senior Vice President, Investor Relations