Moody's Corporation · NYSE:MCO
Moody's — Q2 2022 Earnings Presentation
81 slides from Moody's's earnings presentation, Aug 9, 2022
Slide 1: 2Q 2022 Investor Presentation
2Q 2022 Investor Presentation August 9, 2022
Slide 2: Disclaimer
Disclaimer Certain statements contained in this release are forward-looking statements and are based on future expectations, plans and prospects for Moody’s business and operations that involve a number of risks and uncertainties. Such statements involve estimates, projections, goals, forecasts, ass
Slide 3: Table of Contents
Table of Contents 1. Moody’s Overview 2. Financial Overview 3. Capital Markets Overview 4. Moody’s Investors Service (MIS) 5. Moody’s Analytics (MA) 6. ESG & Climate Solutions 7. Appendix 2Q 2022 Investor Presentation 3
Slide 4: Moody's Overview
1 Moody’s Overview
Slide 5: Company Overview
Company Overview Global integrated risk assessment firm providing credit rating opinions, analytical Independent provider of solutions and insights that empower Provider of financial intelligence credit rating opinions and organizations to make better, faster decisions and analytical tools supportin
Slide 6: Moody's as an Integrated Risk Assessment Business
Moody’s as an Integrated Risk Assessment Business Selection of Use Cases Addressable by Moody’s Solutions $40B+ Current Addressable Helping customers make Weather and natural Market BETTER DECISIONS disaster analysis Transfer pricing Supply chain management CURATED DATA1 and trade credit Entities Se
Slide 7: Multi-Year Investment Approach
Multi-Year Investment Approach Market Penetration and KYC, CRE, Banking and Technology and Customer Access ESG & Climate Product Development Incremental sales staff, Continuation of strategic New capabilities, including customer-oriented travel, investment roadmaps across continued development of Be
Slide 8: Financial Overview
2 Financial Overview
Slide 9: Moody's Corporation Financial Profile
Moody’s Corporation Financial Profile 2Q 2022 TTM Revenue: $6.0 billion Recurring Transaction U.S. Non-U.S. MIS Other1 <1% PPIF 8% DS 39% 45% FIG 20% MIS2 9% R&I MA2 SFG 12% 10% D&I 61% 55% CFG 12% 28% Full Year 2022 Guidance as of July 26, 20223 Revenue » Decline in the high-single-digit percent ra
Slide 10: Macro Assumptions Underpinning Our Outlook
Macro Assumptions Underpinning Our Outlook1 Macroeconomic Assumptions Underpinning 2022 Outlook1 GDP Credit Inflation & Default Growth2 Spreads Unemployment Rates 1.5% - 2.5% United States Benchmark rates to continue to Global inflation levels to remain Global high yield default rise; U.S. high yiel
Slide 11: Financial Performance
Financial Performance1 Revenue2 Adjusted Diluted EPS3 $ Billions $ Per Share $14.00 MIS Revenue MA Revenue $13.50 $13.00 $12.0 $12.50 $12.00 $11.50 $10.0 Decline in the $11.00 $10.50 $9.20 - $9.70 $10.00 high-single-digit $9.50 $8.0 $9.00 $8.50 $6.2 percent range $8.00 $6.0 $4.8 $5.4 $7.50 $4.2 $4.4
Slide 12: Medium-Term Growth Targets
Medium-Term Growth Targets1 M E D I U M - T E R M 2,3 MCO Revenue At least 10% growth MA Revenue Low-to-mid-teens % growth MIS Revenue Low-to-mid-single-digit % growth MCO Adjusted Operating Margin Low-50s % range MA Adjusted Operating Margin Mid-30s % range MIS Adjusted Operating Margin Low-60s % r
Slide 13: Prudent Approach to Capital Allocation
Prudent Approach to Capital Allocation Capital allocation goals Capital allocation levers INVESTING IN GROWTH OPPORTUNITIES Reinvestment Acquisitions RETURN OF CAPITAL Dividends Anchored around Allow for Provide Meet return Manage risk Share repurchases a BBB+ rating adequate necessary capital thres
Slide 14: Investment Criteria and Post-Acquisition Review
Investment Criteria and Post-Acquisition Review Clear Industrial Logic Disciplined Financial Targets Post-Acquisition Review Strategic fit, the most important factor, is the first Long held, clear financial framework for Disciplined and rigorous monitoring post-close screen external (and internal) i
Slide 15: Capital Markets Overview
3 Capital Markets Overview
Slide 16: Default Rates Expected to Rise; High Yield Spreads Fluctuate Around Historical Average
Default Rates Expected to Rise; High Yield Spreads Fluctuate Around Historical Average Default Rates for Speculative-Grade Corporate Rated Issuance1 U.S. HY Bond Spreads2 1000 16% Global U.S. Europe U.S. HY Bond Spreads 14% 800 12% 10% 600 ~550 bps historic average2 8% 6% 4.1% global historic averag
Slide 17: Refunding Walls Continue to Build
Refunding Walls Continue to Build Next four years U.S. and EMEA total refunding needs1 as of: $4.5 ~$4.1 $4.0 ~$3.7 $3.5 $ Trillions $3.0 $2.5 $2.0 ~$2.0 $1.5 $1.0 Jan '12 Jan '13 Jan '14 Jan '15 Jan '16 Jan '17 Jan '18 Jan '19 Jan '20 Sep '20 Sep '21 1. Amount reflects total MIS-rated U.S. non-fina
Slide 18: Refunding Needs Support MIS Long-term Fundamentals
Refunding Needs1 Support MIS Long-term Fundamentals Debt Maturities: U.S. Non-Financial Corporate Bonds and Loans ($B)2 $719 $524 308 $387 Speculative Grade Bank Loans 266 Speculative Grade Bonds 129 151 $249 » Refinancing needs totaling 25 57 62 Investment Grade Bonds 26 more than $4T over the 260
Slide 19: Debt Leverage and Interest Coverage in North America and Europe
Debt Leverage and Interest Coverage in North America and Europe Credit Metrics: North American Speculative Grade Companies1 Debt / EBITDA EBITDA / Interest Expense 8.0x Interest Coverage 5.5x 5.6x 5.8x 6.0x 4.9x 5.1x 5.1x 5.3x 5.3x 5.2x 4.6x 4.6x 4.6x 4.5x 4.3x 4.5x 4.6x 4.0x 2.9x 2.7x 2.9x 3.0x 3.0
Slide 20: Leveraged Finance Issuance Driven by Refinancing and M&A Activity
Leveraged Finance Issuance Driven by Refinancing and M&A Activity Uses of Funds from USD High Yield Bonds and Bank Loans1,2 5% 5% 6% 3% 5% 8% 8% 14% 20% 19% 26% 26% 25% 41% 83% 75% 75% 66% 69% 69% 52% FY 2016 FY 2017 FY 2018 FY 2019 FY 2020 FY 2021 1H 2022 Debt Refinancing M&A Other 3 1. Percent of
Slide 21: Disintermediation of Credit is an Ongoing Trend in the Global Capital Markets
Disintermediation of Credit is an Ongoing Trend in the Global Capital Markets European Non-Financial Corporate Bonds vs. U.S. Non-Financial Corporate Bonds vs. Bank Loans Outstanding Bank Loans Outstanding Bonds Loans Bonds Loans €8 $12 €7 $10 €6 48% €5 $8 € Trillions 4 $ Trillions 4 72% €4 8 8 $6 %
Slide 22: Debt Capital Market Penetration Continues
Debt Capital Market Penetration Continues Emerging Developed Size of bubble reflects 2021 GDP Developed North America6 Other M.E. & Asia3 Asia7 Africa5 ASEAN1 CEE/CIS2 India Latin America4 China Western Europe8 0% 20% 40% 60% 80% 100% 120% 2021 Private Sector Capital Market Debt Securities (Internat
Slide 23: Growth in Private Credit Leads to Mounting Risks
Growth in Private Credit Leads to Mounting Risks1,2 U.S. private credit market now rivals that of the Bank Loans to SMBs3 Continue to Grow, but institutional loan market Banks’ Share of the Market Declines » Private credit totals ~$1 trillion and is estimated to grow Domestic Commercial & Industrial
Slide 24: Moody's Investors Service
4 Moody’s Investors Service
Slide 25: Moody's Investors Service Financial Profile
Moody’s Investors Service Financial Profile 2Q 2022 TTM Revenue: $3.3 billion » 30% recurring revenue » 34% recurring revenue U.S. Recurring Non-U.S. Transaction MIS Other1 1% Public, Project, & Infrastructure 38% Finance 15% 65% Corporate Financial » 51% recurring revenue Finance Institutions 50% 1
Slide 26: MIS: Market Volatility Impacts Expectations for the Year
MIS: Market Volatility Impacts Expectations for the Year Revenue1 Adjusted Operating Margin1 $3.8B 62.2% Decrease in the 54% to 55% low-twenties percent range 2021 2022F 2021 2022F » Cyclical market volatility expected through year-end, with issuance to remain significantly constrained » Projecting
Slide 27: MIS: Issuance is Projected to Remain Subdued
MIS: Issuance is Projected to Remain Subdued FY 2022 Issuance Guidance1,2 Revenue ($B) As of July 26, 2022 As of May 2, 2022 Pandemic-driven issuance Total Issuance (~30%) Macroeconomic volatility & Investment Grade (~25%) geopolitical concerns High Yield Bonds (~70%) $3.8 Leveraged Loans (~40%) Dec
Slide 28: The Benefits of a Moody's Rating
The Benefits of a Moody’s Rating Investors seek Moody’s opinions and particularly value the knowledge of its analysts and the depth of Moody’s research Transparency, Access to capital credit comparison and Responsive to Planning Analytical market stability investor demand and budgeting capabilities
Slide 29: Illustrative Impact of Adding a Moody's Credit Rating
Illustrative Impact of Adding a Moody’s Credit Rating Example: 5-year $500 million corporate bond Not Rated by Moody’s Rated by Moody’s $500,000,000 Bond $500,000,000 1.20% 5-Yr US Treasury Bond Rate 1.20% 500 Option Adjusted Spread (bps)1 435 6.20% Interest Rate 5.55% = $31,000,000 Annual Interest
Slide 30: Full Year 2021 Facts & Figures
PEOPLE $73+ trillion 12,000+ MCO employees FACTS & FIGURES Total rated debt Full Year 2021 1,500+ Analysts AMERICAS EMEA ASIA PACIFIC 40+ Countries/Regions 35,000+ TOTAL RATED DEBT 1 Rated Organizations and Structured Deals $39+ trillion $20+ trillion $10+ trillion EVENTS 5,300+ 3,500+ RATED ORGANIZ
Slide 31: How We Participate in Global Domestic Markets
How We Participate in Global Domestic Markets MIS affiliate (majority) Nigeria Turkey Others MIS affiliate (minority) South Africa Peru Moody’s Local (current) MIS Emerging Markets Revenue1 Mexico Argentina National Scale Ratings Brazil Not under Egypt consideration, or $346M long-term plans under d
Slide 32: Moody's in Greater China
Moody’s in Greater China 2nd Largest Onshore Bond Market at $20 Trillion Revenue and Attributable Income from China2 Total debt securities outstanding 2012 – 20211 MIS Cross Border Revenue Total MA Revenue Attributable Income from CCXI 2012 $170 $160 5% 2021 $50 $150 $130 $ Trillions $ Millions $40
Slide 33: Moody's Analytics
5 Moody’s Analytics
Slide 34: Moody's Analytics at a Glance
Moody’s Analytics at a Glance Strong Financial Profile $2.6bn $30bn+ » Operating in large markets with significant Revenue TTM 2Q 2022 2021 Current Addressable Market1 opportunity for topline growth » Expanding revenue organically and 18% >90% Revenue Growth 2Q 2022 Retention Rate 2Q 2022 through st
Slide 35: Helping Customers Navigate Increasing Global Risks
Helping Customers Navigate Increasing Global Risks MA PROVIDES… Evolving Heightened regulatory Proprietary data with models, software and environment operational and reputational risks 1 expertise that empower customers to better measure, monitor and manage various types of risk Climate change GLOBA
Slide 36: Diverse Customer Base Across Multiple Sectors
Diverse Customer Base Across Multiple Sectors 5,300+ 900+ 70% 52% Governments & Other Entities Insurance Companies of the Fortune 1001 of the Forbes 1,0002 2,300+ 800+ Real Estate Entities ~15,000 Commercial Banks Customers3 3,600+ 200+ Corporates Securities Dealers 155+ and Investment Banks Countri
Slide 37: Compelling Value Proposition
Compelling Value Proposition High-quality franchise » Tech-enabled solutions deeply embedded in customers’ workflows » Proprietary databases » Long-term and strong customer relationships with retention rates in the mid-90’s % range » Resilient recurring subscription business with profitable growth M
Slide 38: Assembling and Integrating Capabilities
Assembling and Integrating Capabilities Underwriting Lending & ESG & Climate Origination Portfolio Assessment Mgmt. Regulatory Investment Compliance Analysis KYC Decision Data & Solutions Research & Information Other Insights Proprietary Economic Data Forecasts Private & & Models Public Company Mode
Slide 39: Data & Information Snapshot
D&I Data & Information Snapshot Raw ingredients for unique insights $710M REVENUE » Create and aggregate extensive data from multiple sources » Standardize, cleanse and curate data » Distribute through cloud-based platforms, APIs and other web interfaces 8% DATA SETS INCLUDE REVENUE GROWTH Data feed
Slide 40: Research & Insights Snapshot
R&I Research & Insights Snapshot Generating actionable insights $719M REVENUE » Model and measure risks related to credit, financial, climate, operational, cyber and others » Forecast and benchmark micro and macroeconomic implications » Provide valuable insights and opinions that inform global decis
Slide 41: Decision Solutions Snapshot
DS Decision Solutions Snapshot Integrating best-in-class data and analytics $1,210M REVENUE » Integrate and connect data, research and analytics for enriching customer applications » Build and support software for specific customer workflows » Embedded components in external ecosystems 36% SOLUTIONS
Slide 42: Current Addressable Market Expanding
$30B+ Current Addressable Market Expanding 2Q 2022 TTM Revenue Operating in Growing Markets Decision 30% 46% 2Q22 -TTM Organic C$ Recurring KYC Solutions 86% recurring revenue 25% Revenue Growth 93% retention rate1 20% Decision Solutions Research & 27% Insights 15% Data & Information Data Applicatio
Slide 43: Strong Execution Enables Consistent Revenue Growth
Strong Execution Enables Consistent Revenue Growth Exceptional value creation - revenue has more than tripled since inception $2,500 2021 Revenue: 2008 – 2021 CAGR: $2,406M +12% (~62% organic) $2,000 CAGR 12% $ Millions $1,500 $1,000 $500 $0 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 201
Slide 44: Recurring Revenue Growth Drives Margin Expansion
Recurring Revenue Growth Drives Margin Expansion TTM Recurring And Transaction Revenue Adjusted Operating Margin1 Recurring Transaction Recurring % ~21% Recurring Revenue ~29.0% CAGR 93% +~440bps 92% 24.6% 88% 84% 81% 76% 2Q17 2Q18 2Q19 2Q20 2Q21 2Q22 2017 2022F 1. Guidance as of July 26, 2022. Refe
Slide 45: Building on a Foundation of Strong Customer Retention
Building on a Foundation of Strong Customer Retention 95% 7% 8% 110% First Half 2022 Retained Base Upgrades and Price New Sales Business Base 95% 7% 9% 111% Full Year 2021 Retained Base Upgrades and Price New Sales Business Base 93% 7% 10% 110% Full Year 2020 Retained Base Upgrades and Price New Sal
Slide 46: MA: Full Year 2022 Guidance
MA: Full Year 2022 Guidance1 Continued focus on profitable revenue growth and reinvestment to fuel future expansion » Mission-critical products and solutions provide integrated perspectives on risk KEY DRIVERS OF » Recurring revenue proportion remains in the mid-90’s; retention rates in the mid-90’s
Slide 47: Accelerating Revenue Growth
Accelerating Revenue Growth Recurring Revenue Growth Rate1 Organic growth Acquired growth 2 2020 ~9% ~4% ~13% Strong Customer Retention Rates 2 Cross-selling, Upgrades & Pricing 2021 ~10% ~7% ~17% Continued SaaS Transition Low-double Low- Low- 2022F double- -digit %1 digit % twenties % Increased Dis
Slide 48: KYC: Best-in-Class Compliance Solutions
DS KYC: Best-in-Class Compliance Solutions Well-positioned to deliver differentiated solutions in a growing market INDUSTRY TRENDS KYC SOLUTIONS Complex Sophisticated D ATA 435+ Companies regulatory crime tactics World’s preeminent and comprehensive database on: million and entities environment » En
Slide 49: RMS: Expanding Mission-Critical Role to Other Industries
DS RMS: Expanding Mission-Critical Role to Other Industries » Cross-trained sales forces to offer » Deepening relationships with P&C » Embedding climate-related breadth of combined product suite customers by providing Moody’s financial loss estimates across holistic suite of products and multiple us
Slide 50: Awards & Accolades
Awards & Accolades Recognition for our industry-leading solutions: data, research, analytics and software 2Q 2022 Investor Presentation 50
Slide 51: ESG & Climate Solutions
6 ESG & Climate Solutions
Slide 52: Moody's is Well-Positioned to Develop Critical ESG & Climate Market Solutions
Moody’s is Well-Positioned to Develop Critical ESG & Climate Market Solutions ESG Domain » Climate Solutions Asset Managers » ESG Measures MESG » Sustainable Finance Banks & Insurers » Catastrophe Models Integrated » Lending Solutions and Tools Companies & Organizations Risk MA » Risk Analytics & Re
Slide 53: Comprehensive ESG & Climate Offerings
Comprehensive ESG & Climate Offerings Holistic, detailed, MESG applies a double materiality Insight delivery suited to customers’ needs. clear: a leading lens to its analysis to capture Includes powerful ESG platforms that give a and reliable financial and stakeholder impact singular view of ESG ris
Slide 54: MIS: Four Components to Integration of ESG & Climate
MIS: Four Components to Integration of ESG & Climate ESG scores transparently and systematically demonstrate the impact of ESG factors on credit ratings Credit Ratings & Research ESG Credit Scores ESG Classification Heat Maps Are ESG factors integrated How is a specific issuer What is ESG? Is ESG ma
Slide 55: MA: Identifying and Quantifying ESG & Climate Risk
MA: Identifying Moodys.com » Physical climate risk exposure scores and Moody’s Analytics Climate Risk » RMS catastrophe models provide ESG performance scores physical risk data and analysis on a and Quantifying » ESG company and sector reports wide range of perils » Economic climate risk impact » MI
Slide 56: Double Materiality
Double Materiality How it Works in our Corporate ESG Assessments A balanced and comprehensive view on ESG performance Looking at a broader range of ESG factors is key because: » Over time, these factors could translate into financial risks that impact enterprise value, and » Today’s investors demand
Slide 57: Moody's ESG360
Moody’s ESG360™ Enhancing customer access to ESG & Climate insights Investing to expand our data universe and develop delivery Moody's ESG360TM for Investors Moody's ESG360TM Connect for Corporates channels to facilitate » A new easy to use approach to » Enables companies to easily engage with easy
Slide 58: Appendix
sl Appendix
Slide 59: Corporate Finance: Revenue and Issuance
Corporate Finance: Revenue and Issuance1 Revenue2: Mix by Quarter Issuance4: Mix by Quarter Global Non-Financial Investment-Grade Bonds Global Non-Financial Speculative-Grade Bonds Other3 Investment Grade Speculative Grade Bank Loans U.S. Speculative-Grade Bank Loans Non-U.S. Speculative-Grade Bank
Slide 60: Corporate Finance: Revenue Diversification
Corporate Finance: Revenue Diversification Revenue1: Distribution by Geography Revenue1: Distribution by Recurring vs. Transaction Non-U.S. U.S. Transaction Recurring 100% 100% 25% 20% 25% 25% 20% 22% 25% 23% 80% 30% 28% 30% 80% 38% 69% 67% 68% 68% 63% 68% 66% 66% 66% 65% 72% 70% 60% 60% 40% 40% 75%
Slide 61: Financial Institutions: Revenue and Issuance
Financial Institutions: Revenue and Issuance1 Revenue2: Mix by Quarter Issuance3: Mix by Quarter Banking Insurance Managed Investments Other Global Speculative Grade Financial Corporate Bonds Global Investment Grade Financial Corporate Bonds $180 $2 $2 $700 $160 $8 $3 $2 $3 $140 $2 $3 $13 $8 $3 $600
Slide 62: Financial Institutions: Revenue Diversification
Financial Institutions: Revenue Diversification Revenue1: Distribution by Geography Revenue1: Distribution by Recurring vs. Transaction Non-U.S. U.S. Transaction Recurring 100% 100% 80% 44% 47% 47% 46% 46% 46% 41% 80% 46% 44% 47% 46% 47% 48% 49% 53% 48% 50% 52% 50% 52% 50% 50% 53% 55% 60% 60% 40% 40
Slide 63: Public, Project and Infrastructure: Revenue and Issuance
Public, Project and Infrastructure: Revenue and Issuance1 Revenue2: Mix by Quarter Issuance3: Mix by Quarter $200 Public Finance and Sovereign Project & Infrastructure Finance Long-Term Rated U.S. Muni Bonds Rated Global Project & Infrastructure Finance Bonds $250 $150 $ Millions $200 $ Billions $84
Slide 64: Public, Project and Infrastructure: Revenue Diversification
Public, Project and Infrastructure: Revenue Diversification Revenue1: Distribution by Geography Revenue1: Distribution by Recurring vs. Transaction Non-U.S. U.S. Transaction Recurring 100% 100% 28% 31% 34% 32% 30% 32% 32% 34% 32% 33% 80% 80% 37% 36% 61% 55% 61% 58% 60% 58% 61% 62% 65% 62% 63% 64% 60
Slide 65: Structured Finance: Revenue and Issuance
Structured Finance: Revenue and Issuance1 Revenue2: Mix by Quarter Issuance3: Mix by Quarter ABS RMBS CMBS Structured Credit Other ABS RMBS CMBS Structured Credit $200 $500 $180 $160 $1 $400 $0 $0 $97 $ Millions $140 $0 $ Billions $67 $39 $1 $120 $1 $300 $70 $53 $57 $0 $36 $59 $31 $100 $1 $0 $38 $60
Slide 66: Structured Finance: Revenue Diversification
Structured Finance: Revenue Diversification Revenue1: Distribution by Geography Revenue1: Distribution by Recurring vs. Transaction Non-U.S. U.S. Transaction Recurring 100% 100% 80% 34% 35% 31% 35% 35% 80% 43% 41% 56% 56% 59% 59% 48% 53% 49% 52% 64% 61% 63% 65% 67% 67% 57% 69% 68% 60% 60% 40% 40% 66
Slide 67: Moody's Analytics: Financial Overview
Moody’s Analytics: Financial Overview Decision Solutions Research & Insights Data & Information Moody’s Analytics Revenue: Mix by Quarter Revenue: Distribution by Line of Business Revenue: Mix by Year $800 100% $3,000 $700 90% 26% $2,406 28% 29% 28% 29% 30% 31% 29% 27% 26% $2,500 $600 $178 $178 80%
Slide 68: Moody's Revenue and Interest Rates Over Time
Moody’s Revenue and Interest Rates1 Over Time MIS Revenue (L) MIS Revenue Guidance MA Revenue (L) MA Revenue Guidance MCO Revenue (L) 10-yr U.S. Treasury Yield (R)1 $7,000 9% 7.8% 8% $6,000 +100bps +120bps 7% 6.5% $ Millions $5,000 6% 5.8% $4,000 5% 4.7% $3,000 4% 3.3% +200bps +180bps 3.0% 3% $2,000
Slide 69: Proactive Capital and Liquidity Management
Proactive Capital and Liquidity Management1 Bond portfolio WAC2 Balanced maturity schedule6 $ in millions 5.0% 4.7% 4.3% 4.3% 4.5% 3.9% 300 4.0% 4.2% 3.5% 3.3% 3.3% 4.0% 3.3% 300 3.5% 3.9% 3.1% 765 500 250 3.0% 3.4% 3.4% 600 500 510 500 300 500 500 500 2.5% 400 400 2.8% 300 300 2.0% 250 2.1% 2.4% 2.
Slide 70: ESG & Climate at Moody's: Snapshot
ESG & Climate at Moody’s: Snapshot1 35+ Years of dedicated ESG ~300M Companies scored via a 43 Awards in the ESG & experience combination of analyst- Climate space (from verified and modeled 2021), including IFR’s scores ‘Best ESG Opinion Provider’ 2021 ~3,500 MIS research reports 10K Companies with
Slide 71: Drivers of Sustainable Corporate Value
Drivers of Sustainable Corporate Value Placing Sustainability at the Core of the Business Better Business Better Lives Better Solutions » Committed to net-zero by 2040: Moody’s is one of the » Published our pay equity analysis for global gender » Launched several new solutions that provide greater f
Slide 72: Modernizing our Internal Data & Technology Infrastructure
Modernizing our Internal Data & Technology Infrastructure to Further Enhance Business Capabilities Cloud and Platform DevOps » Progressing on our cloud infrastructure journey to » Continuing our DevOps journey within MIS and allow “always on”; majority of MA workloads are in MA to promote high quali
Slide 73: Innovation Enabled by Artificial Intelligence (AI)
Innovation Enabled by Artificial Intelligence (AI) Utilizing natural language processing (NLP) and machine learning (ML) across Moody’s external products and solutions mlfabric™ MA Products » Extensible modular machine learning framework » QUIQspread: product capable of automating to accelerate & sc
Slide 74: Addressing the Needs of the Greater China Market
Addressing the Needs of the Greater China Market1 25+ 8,000+ years Research reports International Investors Domestic Investors Covering and serving Related to Asia Pacific, » MIS credit ratings on cross-border » CCXI provides market-leading rating Chinese markets attracting 800,000+ market issuance
Slide 75: Moody's Global Presence
Moody’s Global Presence Americas Argentina Costa Rica Brazil Mexico Bermuda Panama Canada Peru Chile United States Europe, Middle East & Africa Austria Netherlands Belgium Poland Cyprus Portugal Czech Republic Saudi Arabia Denmark Slovak Republic France South Africa Germany Spain Ireland Sweden Isra
Slide 76: Reconciliation of Adjusted Financial Measures to U.S. GAAP
Reconciliation of Adjusted Financial Measures to U.S. GAAP Moody's Corporation Adjusted Operating Income and Adjusted Operating Margin Reconciliation1 Moody's Corporation Net Debt Reconciliation TTM (in $ millions) 2017 2018 2019 2020 2021 1Q 2022 2Q 2022 (in $ millions) 2017 2018 2019 2020 2021 2Q
Slide 77: Reconciliation of Adjusted Financial Measures to U.S. GAAP (cont.)
Reconciliation of Adjusted Financial Measures to U.S. GAAP (cont.) Moody's Corporation Operating Margin Guidance Reconciliation 2022F1 Projected Operating Margin – U.S. GAAP 37% to 38% Depreciation & Amortization Approximately 6% Restructuring 0.5% to 1.0% Projected Adjusted Operating Margin Approxi
Slide 78: Reconciliation of Adjusted Financial Measures to U.S. GAAP (cont.)
Reconciliation of Adjusted Financial Measures to U.S. GAAP (cont.) Moody's Corporation Diluted EPS Reconciliation 2017 2018 2019 2020 2021 2022F1 Diluted EPS – U.S. GAAP $5.15 $6.74 $7.42 $9.39 $11.78 $8.10 to $8.60 Acquisition-Related Intangible Amortization Expenses $0.23 $0.40 $0.42 $0.51 $0.65 ~
Slide 79: Key Assumptions Underlying our Medium-Term Targets
Key Assumptions Underlying our Medium-Term Targets Moody’s medium-term guidance refers to a time period within 5 years and reflects assumptions about numerous factors that could affect its business and is based on currently available information reviewed by management through and as of today’s date.
Slide 80: Investor Relations
Investor Relations ir.moodys.com ir@moodys.com moodys.com
Slide 81: 2Q 2022 Investor Presentation
© 2022 Moody’s Corporation, Moody’s Investors Service, Inc., Moody’s Analytics, Inc. and/or their licensors and affiliates (collectively, “MOODY’S”). All To the extent permitted by law, MOODY’S and its directors, officers, employees, agents, representatives, licensors and suppliers disclaim liabilit