S&P Global Inc. · NYSE:SPGI
S&P Global — McGraw Hill Financial — Q1 2015 Earnings Presentation
17 slides from S&P Global's earnings presentation, Apr 28, 2015
Slide 1: 1Q 2015 Earnings Call
1Q 2015 Doug Peterson Earnings Call President and CEO April 28, 2015 Jack Callahan Executive Vice President and CFO Chip Merritt Vice President, Investor Relations McGraw Hill Financial | 1Q 2015 Earnings Conference Call/Webcast Comparison of Adjusted Information to U.S. GAAP Information This presen
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 statements,” as defined in the Private Securities Litigation Reform Act of 1995. These statements, which express management’s current views concerning future events, trends,
Slide 3: 2015 – Off to a Good Start with 1Q Results
DOUG PETERSON PRESIDENT AND CHIEF EXECUTIVE OFFICER McGraw Hill Financial | 1Q 2015 Earnings Conference Call/Webcast 2015 – Off to a Good Start with 1Q Results • The Company delivered – Strong revenue growth with every business unit achieving revenue and adjusted profit growth – 380 basis‐point impr
Slide 4: Economic Drivers Support Continued Global Growth
Economic Drivers Support Continued Global Growth • U.S. economy continues to strengthen: – Labor market showing solid momentum – Consumer spending fueling GDP growth • Expect European GDP to expand 1.1% this year driven by: – Lower oil prices, quantitative easing, strong U.S. dollar • Asia Pacific i
Slide 5: MHFI Delivers 2015 – Consistent Progress in Every Business Unit
MHFI Delivers ($ in millions) 1Q 2015 1Q 2014 Change Revenue $1,273 $1,196 +6% Adj. Operating Profit $495 $420 +18% Adj. Operating Margin 38.9% 35.1% +380 bps Adjusted Diluted EPS $1.09 $.87 +25% 1Q 2015 highlights: • Healthy revenue growth despite challenging foreign exchange: – 10% domestic growth
Slide 6: Standard & Poor's Ratings Services: Revenue Growth & Cost Containment Elevate Margins
Standard & Poor’s Ratings Services: Revenue Growth & Cost Containment Elevate Margins ($ in millions) 1Q 2015 1Q 2014 Change Revenue $606 $569 +6% Adj. Segment Op. Profit $285 $240 +19% Adj. Segment Op. Margin 47.0% 42.2% +480 bps 1Q 2015 highlights: • Revenue grew 6% • Adjusted expenses decreased 3
Slide 7: Issuance Trends: U.S. and Europe Increased Sequentially
Issuance Trends: U.S and Europe Increased Sequentially United States* Europe* 31% increase year‐over‐year in 1Q 3% decrease year‐over‐year in 1Q (issuance, $ in billions) (issuance, $ in billions) $583 $547 $503 $520 $480 $464 $446 $447 Public $342 $370 Finance Structured Finance Corporates 1Q14 2Q1
Slide 8: S&P Capital IQ: Solid Revenue Growth and Margin Expansion
S&P Capital IQ: Solid Revenue Growth and Margin Expansion ($ in millions) 1Q 2015 1Q 2014 Change Revenue $320 $301 +6%* Segment Op. Profit $63 $53 +18% Segment Op. Margin 19.5% 17.5% +200 bps 1Q 2015 highlights: • Revenue‐led margin expansion continues • Consistent growth in both U.S. and outside th
Slide 9: S&P Dow Jones Indices: Top- and Bottom-Line Growth Despite Difficult Comparison
S&P Dow Jones Indices: Top‐ and Bottom‐Line Growth Despite Difficult Comparison ($ in millions) 1Q 2015 1Q 2014 Change Revenue $143 $137 +5% Segment Op. Profit $95 $91 +4% Segment Op. Margin 66.6% 67.0% (40) bps MHFI Share of Op. Profit* $70 $67 +5% 1Q 2015 highlights: • Derivative, mutual fund, and
Slide 10: S&P Dow Jones Indices: New Avenues for Growth
S&P Dow Jones Indices: New Avenues for Growth Expanding Fixed Income Business • Currently third‐largest provider of fixed income indices • S&P Aggregate™ Bond Index Family will cover over 20,000 individual securities • Launched flagship S&P U.S. Aggregate Bond Index in January • Over 70 new indices
Slide 11: Platts: Continuing to Grow Revenue and Develop Benchmarks
Platts: Continuing to Grow Revenue and Develop Benchmarks • Platts delivered high single‐digit revenue growth despite low commodity prices • Metals and agriculture products had the highest revenue growth rates • Global Trading Services’ revenue increased primarily due to license revenue from The Ste
Slide 12: MHFI: Solid Start to 2015
MHFI: Solid Start to 2015 • All four business units achieved revenue and adjusted operating profit growth • Continued adjusted operating profit margin improvement with 380 basis points increase • Achieved adjusted diluted EPS of $1.09 • Company aligned around four key themes: – Strengthening custome
Slide 13: 1Q 2015: Delivered 25% Adjusted Diluted EPS Growth
Financial Highlights – Key Areas • Consolidated income statements results • Impact of forex on revenue • Adjustments to earnings • Balance sheet update • Free cash flow and return of capital McGraw Hill Financial | 1Q 2015 Earnings Conference Call/Webcast 24 1Q 2015: Delivered 25% Adjusted Diluted E
Slide 14: 1Q 2015: Modest Adjustments to Earnings
1Q 2015: Modest Adjustments to Earnings ($ in millions) 1Q 2015 Legal settlement insurance recoveries +$35 Legal settlement charges ($29) Total pre‐tax gain excluded from adjusted results +$6 McGraw Hill Financial | 1Q 2015 Earnings Conference Call/Webcast 26 1Q 2015: Strong U.S. Dollar Reduces Reve
Slide 15: Impact of Settlement Payments
Impact of Settlement Payments ($ in millions) 1Q 2015 4Q 2014 Cash and equivalents $1,176 $2,497 Short‐term debt $365 $0 Long‐term debt $799 $799 • During the 1Q 2015 paid approximately $1.6 billion for legal settlements • Incurred short‐term debt to meet U.S. cash requirements • Short‐term debt inc
Slide 16: Guidance Remains Unchanged: Good Start to 2015
Guidance Remains Unchanged: Good Start to 2015 ($ in millions) 2015 Guidance Income Statement Revenue Mid single-digit Adjusted Unallocated Expense Flat Adjusted Operating Profit Margin > 125 bps Adjusted Tax Rate < 33.0% Adjusted Diluted EPS $4.35-$4.45 Investment/Free Cash Flow Capital Expenditure
Slide 17: 1Q 2015 Replay Options
1Q 2015 REPLAY OPTIONS Earnings Call • Internet: Replay available for one year Go to http://investor.mhfi.com April 28, 2015 • Telephone: Replay available through May 28, 2015 Domestic: 800‐759‐1637 International: 203‐369‐3019 No password required McGraw Hill Financial | 1Q 2015 Earnings Conference
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