Gartner, Inc. · NYSE:IT
Gartner — Investor Presentation (February 2011)
111 slides from Gartner's investor presentation, Feb 16, 2011
Slide 1: Gartner
Gartner.
Slide 2: Forward Looking Statements
Forward Looking Statements Statements contained in this presentation regarding the growth and prospects of the business, the Company’s projected 2011 financial results, long-term objectives and all other statements in this presentation other than recitation of historical facts are forward looking st
Slide 3: Agenda
Agenda Business OverviewGene Hall Research Peter Sondergaard Events Alwyn Dawkins ConsultingPer Anders Waern BreakSales David Godfrey Financial OverviewChris Lafond Summary / Q&AGene Hall and Chris Lafond
Slide 4: Gene Hall, Chief Executive Officer
Gene HallChief Executive OfficerGartnerThis presentation, including any supporting materials, is owned by Gartner, Inc. and/or its affiliates and is for the sole use of the intended Gartner audience or other authorized recipients. This presentation may contain information that is confidential, propr
Slide 5: Gartner is the best source for clients to determine where and how to use IT
Gartner is the best source for clients to determine where and how to use IT to accomplishtheirir objectivesGartner.
Slide 6: Why Invest in Gartner
Why Invest in GartnerLong term, double-digit revenue growthRevenue growth leveraged to drive higher growth in EBITDA,EPS and cash flowProven track recordGartner.
Slide 7: Gartner is the best source for IT and Supply Chain Management
Gartner is the best source for clients to determine where and how to use IT and Supply Chain Management to accomplishheirir objectivesGartner.
Slide 8: Why Invest in Gartner
Why Invest in GartnerLong term, double-digit revenue growthStrong value proposition Vast untapped market opportunityStrategy and operationalexcellence to drive growth Revenue growth leveraged to drive higher growth in EBITDA, EPS andcash flowProven track recordGartner
Slide 9: Gartner Extraordinary Research Insight
GartnerExtraordinaryResearchInsightgartner.
Slide 10: Gartner Business Segments: Research, Events, Consulting
GartnerGartner EventsBusinessGartnerConsultingBusinessResearchBusiness Note: Percentages based on mid-point of 2011 revenue guidance. See Forward Looking Statement disclaimer on page 1 for factors that may affect our ability to achieve these projected results. Gartner
Slide 11: Gartner Research Business
GartnerGartnerResearchBusinessHighly differentiated insight delivered primarily through digital media subscriptionsGartner.
Slide 12: Gartner Events Business
GartnerExtraordinaryResearchInsightGartnerEventsBusinessDifferentiated live events leveraging research contentGartner.
Slide 13: Gartner Consulting Business
GartnerExtraordinaryResearchInsightGartnerConsultingBusinessLonger-term differentiated engagements leveraging Gartner researchGartner.
Slide 14: Role-based Recurring revenue
Role-basedRecurringrevenuGartner.
Slide 15: Research Insight
Research InsightIndependent and Objective ComprehensiveExtremely Cost-effectiveThe best source for addressing any IT issueGartner.
Slide 16: Research Pricing Strategy
Research Pricing Strategy New Clients Existing Clients List Price List Price Legacy List Price Pricing Annual Price Increases Legacy Products New Products Gartner.
Slide 17: Winning Growth Strategy
Winning Growth Strategy Extraordinary Strong Sales Capability Research Insight High Value World-Class ServiceDifferentiated OfferingsContinuous Improvement and InnovationPerformance-driven Leadership Teamartner.
Slide 18: Performance Driven Leadership Team
Performance Driven Leadership TeamAvg Tenure at Gartner11 yearsTenuredvg Tenure in Role5 yearsGlobalNationalityWorld-Class TalentSource of LeadershipNon-USUS Promotion 50%External 36%Acquisition 14%Gartner.
Slide 19: Why Invest in Gartner
Why Invest in Gartner Long term, double-digit revenue growth Strong value proposition Vast untapped market opportunity Strategy and operational excellence to drive growth Revenue growth leveraged to drive higher growth in EBITDA, EPS andcash flow Proven track recordGartner
Slide 20: Why Invest in Gartner
Why Invest in Gartner Long term, double-digit revenue growth Revenue growth leveraged to drive higher growth in EBITDA, EPS and cash flow Proven track record Gartner.
Slide 21: Revenue Growth Leveraged to Drive Higher Growth in EBITDA and Margin Expansion
Revenue Growth Leveraged to Drive Higher Growth in EBITDA and Margin Expansion Normalized EBITDA Margin 179610 bps 118improvement2004 2010See attached Glossary for a discussion of Normalized EBITDA.Gartner
Slide 22: Why Invest in Gartner
Why Invest in Gartner Long term, double-digit revenue growth Revenue growth leveraged to drive higher growth in EBITDA, EPS and cash flow Proven track record Gartner.
Slide 23: Why Invest in Gartner
Why Invest in Gartner Long term, double-digit revenue growth Revenue growth leveraged to drive higher growth in EBITDA, EPS and cash flow Proven track record Gartner.
Slide 24: Gartner Research Business
GartnerGartnerResearchBusinessHighly differentiated insight delivered primarily through digital media subscriptionsGartner.
Slide 25: Gartner
Gartner.
Slide 26: Peter Sondergaard, Senior Vice President, Research
Peter SondergaardSenior Vice PresidentesearchThis presentation, including any supporting materials, is owned by Gartner, Inc. and/or its affiliates and is for the sole use of the intended Gartner audience or other authorized recipients. This presentation may contain information that is confidential,
Slide 27: Why Invest in Gartner
Why Invest in Gartner Long term, double-digit revenue growth Strong value proposition Vast untapped market opportunity Strategy and operational excellence to drive growth Revenue growth leveraged to drive higher growth in EBITDA, EPS and cash flow Proven track recordGartner
Slide 28: Gartner Business Segments
GartnerGartner EventssinessrtneronsultingGartnerBusinessNote: percentages based on mid-point of 2011 revenue guidance. See Forward Looking Statement disclaimer on page 1 for factors that may affect our ability to achieve these projected results.Gartner
Slide 29: Gartner Research Model: The People
Gartner Research Model The People Analysts 50% have 20+years of industry experience Subject Matter Experts Over 760 analysts in 26 countries Over 120 based in APAC, over 160 based in Europe Minimum 12 years of experience at time of hire
Slide 30: Gartner Research Model: The Research Process
Gartner Research Model The Research ProcessProcess Academic InstitutionsGartner
Slide 31: Gartner Research Model: The Research Process
Gartner Research Model The Research Process Process Data Management & Integration Business Intelligence VirtualizationBusiness Process ManagementHigh-Performance Workplace Regulatory Compliance Emerging Trends & TechnologiesCustomer Reationship Managementdustry Geography Open Source Mobile & Wireles
Slide 32: Gartner Research Model: Proprietary Data and Analytics
Gartner Research Model Proprietary Data Proprietary Data and AnalyticsAnalytics Proprietary Data and Analytics 2.9 million end-user searches per year 3.2 million document page views 220,000 recorded interactions 5,500 IT Cost and Price benchmarks Over 2,500 contract reviews and
Slide 33: Gartner Research Business
Gartner ResearchGartnerResearchBusiness Highly differentiated insight delivered primarily through digital media subscriptionsartner.
Slide 34: Gartner Research Vast Untapped Market Opportunity
Gartner Research Vast Untapped Market Opportunity $45 Billion Other Supply Chain CIO IT Functional Leader IT Professional $1 Billion technology, professional services, telecommunications and investors2010 ending Contract Value. Source: Gartner internal estimates.Gartner.
Slide 35: Research sold as subscriptions to individuals
Research sold as subscriptions to individuals Gartner.
Slide 36: Gartner Research Model: Packaging and Presentation
Gartner Research Model Packaging and PresentationPackaging ritten Actionable Advice 70,000 structured documents, 7,000 ofich were created in the past yearMethodologies enabling immediate insight incomplex decisionsMagic QuadrantsMarketScopes Hype CyclesVendor Ratings
Slide 37: Gartner Research Model: Packaging and Presentation
Gartner Research Model Packaging and Presentation ackaging Interactions Scalable structure and process to handle and rapidly respond to 250,000 one-on-one interactions Phone access to analysts giving personal, immediate and specific advice on key decisions Face-to-face interactions and advice with k
Slide 38: Research Case Study — Virtualization
Research Case Study — Virtualization Client Problem Gartner Solution Benefits Achieved Major Petrochemical 22 Gartner users with Helped client parse the company with $2.4 access to research and quote line by line billion IT budget analysts Provided benchmarks Eight critical IT Used over 360 on where
Slide 39: Research Case Study — E-commerce
Research Case Study — E-commerce Client Problem Gartner Solution Benefits Achieved $6-7B North American Research staged a A highly integrated distributor series of interactions to strategy for social and Upgrade to e-commerce solution, advise them across phases of the mobile e-commerce Considered wi
Slide 40: Why Invest in Gartner
Why Invest in Gartner Long term, double-digit revenue growth Strong value proposition Vast untapped market opportunity Strategy and operational excellence to drive growth Revenue growth leveraged to drive higher growth in EBITDA, EPS and cash flow Proven track record Gartner
Slide 41: Gartner
Gartner.
Slide 42: Gartner
Gartner.
Slide 43: Our mission: Make every conference the MUST ATTEND event
Our missionMake every conference we produce the MUST ATTEND event for the communities we serveGartner.
Slide 44: Gartner Events: World's Leading IT Conference Producer
Gartner Events 6 Events 37,200 attendees 1,200 exhibitorsExtraordinaryResearch InsightWorld’s Leading IT Conference ProducerGartner.
Slide 45: Gartner Events
Gartner Events People Process Proprietary Data Current Relevant Actionable For 7 of 10 attendees, Gartner is the only conference they attend each year Gartner
Slide 46: Gartner
Gartner.
Slide 47: Attendee Value Proposition
Attendee Value Proposition Face-to-face Analyst interaction Industry leaders Unparalleled peer networking Access to leading solution providers Actionable advice Gartner.
Slide 48: Exhibitor Value Proposition
Exhibitor Value PropositionFace to face interaction with high level attendeesMaintain existing relationshipsBuild new relationships
Slide 49: Gartner
Gartner.
Slide 50: 2010 Gartner Event Portfolio
2010 Gartner Event Portfolio56 strategic conferences 22% increase in global attendance
Slide 51: Gartner Symposium ITxpo 2010
I Gartner. SYMPOSIUM ITXPO2010The World’s Most Important Gathering of CIOs and Senior IT Executives
Slide 52: 2011 Gartner Event Portfolio
2011 Gartner Event PortfolioOver 60 strategic conferences
Slide 53: Why Invest in Gartner
Why Invest in Gartner Long term, double-digit revenue growth Strong value proposition Vast untapped market opportunity Strategy and operational excellence to drive growth Revenue growth leveraged to drive higher growth in EBITDA, EPS and cash flow Proven track record Gartner
Slide 54: Gartner
Gartner.
Slide 55: Per Anders Waern, Senior Vice President, Gartner Consulting
Per Anders Waern Senior Vice President Gartner Consulting This presentation, including any supporting materials, is owned by Gartner, Inc. and/or its affiliates and is for the sole use of the intended Gartner audience or other authorized recipients. This presentation may contain information that is
Slide 56: Gartner Consulting Business
Gartner ConsultingExtraordinaryResearchInsight GartnerConsultingBusiness Longer-term differentiated engagements leveraging Gartner researchGartner.
Slide 57: Consulting mission: on-site support to operationalize research insights
Our mission: Provide Gartner clients with on-site support, helping ther o operationalize research nsights and realize benefits in their organizationsGartner.
Slide 58: A Strong and Unique Proposition: Gartner Consulting
A Strong and UniqueProposition Gartner Consulting Core Consulting Benchmarking Services Contract Optimization Independent & Objective Powered by Research Benchmark EnabledGartner.
Slide 59: Sourcing Advisory Services Case Study
Sourcing Advisory Services Case Study Client Problem artner Solution Benefits Achieved Major manufacturing client at end of large outsourcing deal Desire to improve service and flexibility, and to reduce costs Sharpened the overall Sourcing strategy Assessed contract and uncovered cost savings Devel
Slide 60: Benchmarking Analytics Case Study
Benchmarking Analytics Case Study Gartner Solution enefits Achieved nalyzed its IT spending in order to find immediate cost saving potentials Our findings showed 15% overspending vs. average performance and 55% vs. best in class organizations Currently realizing identified cost savingsGartner.
Slide 61: Gartner
Gartner.
Slide 62: Gartner Consulting Gross Contribution Margin
Gartner Consulting Gross Contribution Margin Continuous productivity improvements Margin expansion $101M in starting backlog 201120042010 Note: 2004 Gross Contribution Margin re-stated to reflect the impact of equity compensation expenseimpact is 1 pt.Gartner
Slide 63: Gartner Consulting Business
Gartner ConsultingExtraordinaryResearchInsightGartnerConsultingBusinessLonger-term differentiated engagements leveraging Gartner researchGartner.
Slide 64: Gartner
Gartner.
Slide 65: David Godfrey, Senior Vice President Worldwide Sales
David GodfreySenior Vice President Worldwide Sales This presentation, including any supporting materials, is owned by Gartner, Inc. and/or its affiliates and is for the sole use of the intended Gartner audience or other authorized recipients. This presentation may contain information that is confide
Slide 66: Gartner Sales People
artner SalesPeopleGartner.
Slide 67: Gartner Sales People
Benchmarking Analytics Case Study Gartner SalesPeople1,049 quota-bearing sales associates
Slide 68: Vast Market Opportunity For Research
Vast Market Opportunity For Research $45 Billion Other Supply Chain CIOs IT Functional Leaders Front-line IT Professionals $1 Billion
Slide 69: Vast Market Opportunity For Research
Vast Market Opportunity For Research $45 Billion Other Supply Chain CIOs IT Functional Leaders Front-line IT Professionals$1 Billion 100,000
Slide 70: Research sold as subscriptions to individuals
Research sold as subscriptions to individuals le-basedRecurring revenue Gartner.
Slide 71: Why Invest in Gartner
Why Invest in Gartner ong term, double-digit revenue growth Strong value proposition Vast untapped market opportunity Strategy and operational excellence to drive growth Revenue growth leveraged to drive higher growth in EBITDA, EPS and cash flow Proven track record Gartner
Slide 72: Sales Strategy to Capture Market Opportunity
Sales Strategy to Capture Market OpportunityCapacityCoverageSales EffectivenessGartner.
Slide 73: Sales Strategy: Capacity
Sales Strategy to Capture Market Opportunity Capacity 15 — 20% increased annual sales headcount objective Architected recruitment and training plan Direct Quota BearingHeadcount
Slide 74: Gartner Sales: A great place to work
Gartner Sales: A great place to workBeing part of a growth company allows:Career opportunityProfessional developmentGreat earnings potentialProduct innovation Access to senior levels High-performance cultureGartner.
Slide 75: Sales Strategy: Coverage
Sales Strategy to Capture Market OpportunityCoverage Focused channel approach Matched to global opportunity Emphasizing Client intimacy
Slide 76: Sales Strategy: Sales Effectiveness
Sales Strategy to Capture Market OpportunitySales Effectiveness Enhanced use of proprietary tools and best practices Increased revenue per client Average CV per Client Organization2010Gartner.
Slide 77: Why Invest in Gartner
Why Invest in Gartner Long term, double-digit revenue growth Strong value proposition Vast untapped market opportunity Strategy and operational excellence to drive growth Revenue growth leveraged to drive higher growth in EBITDA, EPS and cash flow Proven track recordGartner
Slide 78: Gartner
Gartner.
Slide 79: Chris Lafond, Chief Financial Officer
Chris LafondGartner Chief Financial Officer This presentation, including any supporting materials, is owned by Gartner, Inc. and/or its affiliates and is for the sole use of the intended Gartner audience or other authorized recipients. This presentation may contain information that is confidential,
Slide 80: Winning Growth Strategy
Winning Growth Strategy Extraordinary Strong Sales Capability Research Insight
Slide 81: Consistent Growth Strategy: The Financial Plan We Set in 2005
Consistent Growth Strategy The Financial Plan We Set in 2005 Grow the Research business Effectively manage the Events portfolio Improve the profitability of the Consulting business Leverage our G&A infrastructure Drive shareholder valueartner.
Slide 82: Strategy for growing research has shifted the mix of the business
Strategy for growing research has resulted in a meaningful shift in mix of the business a Based on mid-point of 2011 revenue guidance b See Forward Looking Statement disclaimer on page 1 for factors that may affect our ability to achieve these results.Gartner.
Slide 83: Why Invest in Gartner
Why Invest in Gartner Long term, double-digit revenue growth Revenue growth leveraged to drive higher growth in EBITDA, EPS and cash flow Proven track record Gartner.
Slide 84: Our Unique Business Model: Gartner's Financial Strength
Our Unique Business Model Gartner’s Financial Strength Compound Annual Growth Rate 2004 — 2010 Revenue EBITDA Free EPS
Slide 85: Why Invest in Gartner
Why Invest in Gartner Long term, double-digit revenue growth Strong value proposition Vast untapped market opportunity Strategy and operational excellence to drive growth Revenue growth leveraged to drive higher growth in EBITDA, EPS and cash flow Proven track recorGartner
Slide 86: Proven Sales Strategy Delivering Results
Proven Sales Strategy Delivering Results 1,049 11,601 $84K $978M 8,720 $58K $509M 2004 2010 2004 2010 2004 2010 2004 2010 Quota esearch AverageContract Bearing ClientContract Value HeadcountOrganizations Value per Organization
Slide 87: Proven Track Record: Revenue Growth
Consistent Growth Strategy Proven Track Record: Revenue Growth Total Revenue (a) $ in millions 279 1,288 (a) Restated to exclude results of Vision Events (b) CAGR calculations use mid-point of 2011 guidance (c) See Forward Looking Statement disclaimer on page 1 for factors that may affect our abilit
Slide 88: Margin Expansion
Margin Expansion igh incremental gross contribution margins Scalable global infrastructure G&A leverage Normalized EBITDA Margin(a) (b) (c) (a) See the attached Glossary for the definition of Normalized EBITDA, and cautionary statement regarding this non-GAAP financial measure (b) 2011 Normalized EB
Slide 89: Business Model: Incremental Gross Contribution Margins
Business Model Incremental Gross Contribution Margins
Slide 90: Business Model: Gross Contribution
Business Model ross Contribution 20042010 Notes: 2004 figures re-stated to reflect impact of Equity Compensation expenseimpact as follows: Research 1 pt, Eventst, Consulting 1 pt, SG&A 1 pt.Gartner.
Slide 91: Cash Flow Leverage
Cash Flow Leverage Up-front billing for majority of Research contracts Non-capital intensive business Cash From Operations (c) See Forward Looking Statement disclaimer on page 1 for factors that may affect our ability to achieve these results.
Slide 92: Focus on Capital Structure and Strategic Use of Cash
Focus on Capital Structure and StrategicUse of Cash Low levels of debt with ample and favorable available credit Cash deployed for selective strategic acquisitions Cash deployed for share re-purchases Debt Normalized EBITDA Ratio
Slide 93: Long-Term Financial Objectives
Long-Term Financial ObjectivesTotal Revenue GrowthResearchConsultingEventsAnnual(1) (1) See Forward Looking Statement disclaimer on page 1 for factors that may affect our ability to achieve these results. (2) Excludes equity compensation expense Note: See the attached Glossary for the definition of
Slide 94: Offering Summary
Offering Summary Offering Secondary offering of common stock Company Gartner, Inc. 8,000,000 shares to the public (ValueAct selling 8.5mm shares in total, Company will repurchase 0.5mm shares concurrently in a privately negotiated Offered transaction) Over-allotment Option 15% (100% secondary) Selli
Slide 95: Why Invest in Gartner
Why Invest in GartnerLong term, double-digit revenue growthevenue growth leveraged to drive higher growth in EBITDA, EPS and cash flowProven track recordGartner.
Slide 96: Q&A
Q&A Gartner.
Slide 97: Gartner
Gartner.
Slide 98: Why Invest in Gartner
Why Invest in GartnerLong term, double-digit revenue growthRevenue growth leveraged to drive higher growth in EBITDA, EPS and cash flowProven track recordGartner.
Slide 99: Gartner
Gartner.
Slide 100: Appendix
Appendix
Slide 101: Projected 2011 Full Year Revenue and EBITDA Outlook
Projected 2011 Full Year Revenue and EBITDA Outlook ($ in millions except per share data) Research Consulting Events Total Revenue Normalized EBITDA (2) 2011 Projection (1) change (1) (1) See Forward Looking Statement disclaimer on page 1 for factors that may affect our ability to achieve these resu
Slide 102: Projected 2011 Earnings and Cash Flow Outlook
Projected 2011 Earnings and Cash Flow Outlook (1) Includes a projected $(0.04) per share impact from AMR Research and Burton Group Acquisition Adjustments. In 2010, these charges were $(0.14) per share. (2) Includes approximately $15.0 million of estimated payments for the renovation of our Stamford
Slide 103: Projected 2011 Quarterly Phasing Revenue
Projected 2011 Quarterly Phasing Revenue Research revenue driven by retention rates and timing of new business Balanced renewals with 26% expected in Q1 Fourth quarter historically the largest for new business Events revenue recognized when conferences delivered Symposium Series in Q4 drives phasing
Slide 104: Projected 2011 Quarterly Phasing Revenue
Projected 2011 Quarterly Phasing Revenue Approximate estimated revenue phasing in 2011:ResearchConsultingEvents Above based on midpoint of revenue guidanceNote: See Forward Looking Statement disclaimer on page 1 for factors that may affect our ability toachieve these results.Gartner.
Slide 105: Projected 2011 Quarterly Phasing Expense
Projected 2011 Quarterly Phasing Expense Quarterly fluctuations in cost of services driven primarily by the conference schedule in our Events business Higher Research and Sales expenses in Q4 related to Symposia and year-end sales support activities G&A is less seasonal Note: See Forward Looking Sta
Slide 106: Projected 2011 Sales, G&A and Other Expenses
Projected 2011 Sales, G&A and Other Expenses Depreciation and amortization of $33 — 34 million nterest expense of $11 — 13 million Other income/expense of $2 — 3 million (primarily transaction FX gains/losses) Tax rate projected to be between 31 and 32% Note: See Forward Looking Statement disclaimer
Slide 107: Projected 2011 Quarterly Phasing Earnings
Projected 2011 Quarterly Phasing Earnings pproximate income per share excluding acuisition and integration charges: Above based on the midpoint of guidance Based upon business conditions the Company may accelerate or postpone expenses throughout the year which could shift earnings between quarters N
Slide 108: Glossary: Non-GAAP Financial Measures
Glossary Non-GAAP Financial Measures Investors are cautioned that Normalized EBITDA and Free Cash Flow are not financial measures under generally accepted accounting principles. In addition, they should not be construed as alternatives to any other measures of performance determined in accordance wi
Slide 109: Glossary: Non-GAAP Financial Measures, Free Cash Flow
Glossary on-GAAP Financial Measures ree Cash Flow: Represents cash provided by operating activities excluding cash charges related to the acquisitions of AMR Research and Burton Group, which primarily consist of certain non-recurring costs such as severance and other exit costs (“Cash Acquisition an
Slide 110: Registration statement and prospectus notice
The issuer has filed a registration statement (including a preliminary prospectus supplement dated February 15, 2011 and an accompanying prospectus dated February 15, 2011) with the Securities and Exchange Commission (the “SEC”) for the offering to which this communication relates. Before you invest
Slide 111: Gartner
Gartner.