Morningstar, Inc. · NASDAQ:MORN
Morningstar — Q1 2022 Earnings Presentation
23 slides from Morningstar's earnings presentation, Apr 28, 2022
Slide 1: First Quarter 2022 Supplemental Presentation
First Quarter 2022 Supplemental Presentation April 27, 2022
Slide 2: Forward-looking statements and non-GAAP measures
This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based on our current expectations about future events or future financial performance. Forward-looking statements by their nature address matters that
Slide 3: Q1 2022 Financial Performance
Q1 2022 Financial Performance ($mil) $56.4 $67.2 22 21 $82.5 ҄16.3% –16.1% –10.6% 22 21 $457.0 $392.8 22 21 $92.3 ($4.5) NM 22 21 $41.5 Adjusted operating income is a non-GAAP measure and excludes intangible amortization expense and all mergers and acquisitions (M&A)-related expenses from operating
Slide 4: Q1 2022 Revenue Walk
Q1 2022 Revenue Walk *Organic revenue excludes revenue from acquisitions for a period of 12 months upon completion of the acquisition, accounting changes, and the effect of foreign currency translations. 16.3% Reported Revenue Growth Impact of M&A, Accounting Changes, and Currency 18.1% 1.8% Contrib
Slide 5: Quarterly Revenue Growth Trend
Quarterly Revenue Growth Trend ($mil) Bars represent reported revenue. Percentages represent YOY organic revenue growth, which is a non-GAAP measure. Tran saction-Based Reven ue Asset-Based Revenue License-Based Revenue Consolidated Organic Revenue Growth 5 5
Slide 6: Q1 2022 Revenue Drivers: License-Based Revenue Growth
Q1 2022 Revenue Drivers: License-Based Revenue Growth ($mil) +17.2% Reported +18.8% Organic 22 21 License-Based Revenue Drivers: PitchBook (+49.4%), Morningstar Sustainalytics (+47.7%), Morningstar Direct (+10.2%), and Morningstar Data (+9.7%) were the primary contributors to license-based organic r
Slide 7: License-Based Quarterly Trends: PitchBook, Morningstar Direct
License-Based Quarterly Trends PitchBook ($mil) PitchBook Revenue YOY Organic Revenue Growth YOY License Growth Morningstar Direct Revenue YOY Organic Revenue Growth YOY License Growth Morningstar Direct ($mil) 7 7
Slide 8: License-Based Quarterly Trends: Advisor Workstation, Morningstar Data
License-Based Quarterly Trends Advisor Workstation ($mil) Advisor Workstation Revenue YOY Organic Revenue Growth Morningstar Data ($mil) Morningstar Data Revenue YOY Organic Revenue Growth 8 8
Slide 9: License-Based Quarterly Trends: Morningstar Sustainalytics
License-Based Quarterly Trends Morningstar Sustainalytics ($mil) 9 9
Slide 10: Q1 2022 Revenue Drivers: Asset-Based Revenue Growth
Q1 2022 Revenue Drivers: Asset-Based Revenue Growth ($mil) Bars represent reported revenue. Organic revenue growth is a non-GAAP measure. Asset-Based Revenue Drivers: Morningstar Indexes (+54.1%) was the largest contributor to organic revenue in Q1 2022 along with positive performance in both Invest
Slide 11: Asset-Based Quarterly Trends: Investment Management
Asset-Based Quarterly Trends: Investment Management ($bil) Investment Management AUM/A: Investment Management assets increased 6.9% year over year in aggregate, primarily driven by Morningstar Managed Portfolios. Managed Portfolios in the U.S. was the largest revenue driver in the quarter. The decli
Slide 12: Asset-Based Quarterly Trends: Workplace Solutions
Asset-Based Quarterly Trends: Workplace Solutions ($bil) Workplace Solutions Q1 2022 AUM/A: Workplace Solutions assets grew 9.2% year over year, driven Managed Accounts AUM/A growth (+14.7%). Within Managed Accounts, Morningstar Retirement Manager was the primary driver of revenue growth in Q1 2022.
Slide 13: Q1 2022 Revenue Drivers: Transaction-Based Revenue Growth
Q1 2022 Revenue Drivers: Transaction-Based Revenue Growth ($mil) Bars represent reported revenue. Organic revenue growth is a non-GAAP measure. Transaction-Based Revenue Drivers: DBRS Morningstar organic revenue growth of 17.6% benefited from robust issuance activity in U.S. structured finance asset c
Slide 14: DBRS Morningstar Revenue Growth by Geography
Quarterly Transaction-Based Trends: DBRS Morningstar Revenue Growth by Geography ($mil) EMEA Canada DBRS Morningstar Q1 2022 Revenue Drivers: Revenue grew 46.0% year over year in the U.S., driven by higher issuance in CMBS, RMBS and corporate credit. EMEA declined (-15.6%) in aggregate and across mo
Slide 15: DBRS Morningstar Revenue by Asset Class
Quarterly Transaction-Based Trends: DBRS Morningstar Revenue by Asset Class ($mil) DBRS Morningstar Q1 2022 Revenue Drivers: Category mix in Q1 2022 was 67% Structured Finance vs 33% Fundamental Ratings. Growth in structured credit in the U.S. was the primary driver of revenue growth in the quarter,
Slide 16: Q1 2022 Operating Margins
Q1 2022 Operating Margins Operating Margin Drivers: Expense growth adjusted for M&A-related expenses outpaced revenue growth in the quarter. Key drivers of expense growth: Compensation costs increased due headcount growth across key areas of the Company including Morningstar Sustainalytics, PitchBoo
Slide 17: Quarterly Operating Margin Trends
Quarterly Operating Margin Trends Adjusted operating margin is a non-GAAP financial measure. Operating Margin Adjusted Operating Margin 17 17
Slide 18: Q1 2022 Cash Flow and Capital Allocation
Q1 2022 Cash Flow and Capital Allocation ($mil) 2 ($mil) CapEx 28.0 Dividends 15.5 Equity Method Investments 1.0 M&A 6.8 Share Repurchases 110.6 Q1 22 Q1 22 $23.5 –$4.5 Operating Cash Flow Free Cash Flow* Capital Allocation** * Free cash flow is a non-GAAP measure and is defined as cash provided by or
Slide 19: Reconciliation from Reported to Organic Revenue Growth
Reconciliation from Reported to Organic Revenue Growth 19 19
Slide 20: Reconciliation from Reported to Organic Revenue Growth
Reconciliation from Reported to Organic Revenue Growth 20 20
Slide 21: Reconciliation from Reported to Organic Revenue Growth
Reconciliation from Reported to Organic Revenue Growth 21 21
Slide 22: Reconciliation from Operating to Adjusted Operating Margin
Reconciliation from Operating to Adjusted Operating Margin 22 22
Slide 23: Morningstar
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