Verisk Analytics, Inc. · NASDAQ:VRSK

Verisk Analytics — William Blair Annual Growth Stock Conference 2019

28 slides from Verisk Analytics's conference presentation, Jun 5, 2019

  1. Slide 1: Verisk Analytics

    Verisk Analytics Scott Stephenson, CEO William Blair Annual Growth Stock Conference June 5, 2019 © 2019 Verisk Analytics, Inc. All rights reserved. 1

  2. Slide 2: Forward Looking Statements, Safe Harbor, and Non-GAAP Financial Measures

    Investor Presentation Forward Looking Statements, Safe Harbor, and Non-GAAP Financial Measures Forward-Looking Statements This release contains forward-looking statements. These statements relate to future events or to future financial performance and involve known and unknown risks, uncertainties,

  3. Slide 3: Leveraging Distinct Assets to Drive Growth

    Investor Presentation Leveraging Distinct Assets to Drive Growth Distinctives Unique Deep Steady Stream of Deep Integration Data Domain First-to-Market into Customer Assets Expertise Innovations Workflows Growth Strategy Increase Solution Develop New Proprietary Leverage Our Pursue Strategic Penetra

  4. Slide 4: Scaled Business Model Platform with Industry-Leading EBITDA Margins

    Investor Presentation Scaled Business Model Platform with Industry-Leading EBITDA Margins Insurance Energy and Financial Services Verisk is a leading Specialized Markets data analytics Underwriting & Rating Research, Consulting, Data, Information, and provider serving Solutions Analytic Solutions to

  5. Slide 5: Our Unique and Valuable Data Assets

    Investor Presentation Our Unique and Valuable Data Assets Some examples Solutions Advantages Property/Casualty Insurance 6M commercial properties and 27.5M businesses; ratings on ~40K fire protection areas Energy and Specialized Markets 60+ tools and models providing insight and analysis across the

  6. Slide 6: Moated Business Supports Strong Financial Outcomes

    Investor Presentation Moated Business Supports Strong Financial Outcomes MODEL TARGET OUTCOMES Business Vertical Expertise Creators Who Are Contributory Deeply Efficient with ORGANIC REVENUE GROWTH Data Integrated Capital 7-8% on average, over time ORGANIC EBITDA GROWTH 1-2 pts faster than revenue g

  7. Slide 7: Strong Track Record of Organic Revenue Growth

    Investor Presentation Strong Track Record of Organic Revenue Growth (1,2,3) Total Organic Revenue Revenue $ % Growth 8.5% normalized organic constant currency (3) 7.8% 7.8% 8.0% 7.7% 6.9% 7.1% 7.2% 5.6% 5.8% 3,000.0 4.6% 49.0% 44.0% 4.2% 2,500.0 39.0% 2,000.0 34.0% 29.0% 1,500.0 24.0% 1,000.0 19.0%

  8. Slide 8: High-Quality Recurring Revenue across a Diversified Solution Set

    Investor Presentation High-Quality Recurring Revenue across a Diversified Solution Set Revenue – Subscription vs. Non-Subscription Revenue – Segment Breakdown $2.0B $2.1B $2.4B $2.0B $2.1B $2.4B 7% 7% 7% 16% 19% 20% 22% 21% 22% 84% 81% 80% 71% 72% 71% 2016 2017 2018 2016 2017 2018 Subscription/Long-

  9. Slide 9: Verisk Insurance Solutions: Voice of the Customer

    Investor Presentation Verisk Insurance Solutions: Voice of the Customer Growth Opportunities: Cross-Sell 2013–2018 Average Number of Products Across 26 Product Categories 18.3 2013 2016 2018 16.0 16.2 13.9 11.6 10.7 10.3 8.5 6.6 5.7 5.0 3.9 1-10 11-25 26-100 101-500 Top Customers Based on Verisk Rev

  10. Slide 10: Competitive Scoreboard for 2018

    Investor Presentation Competitive Scoreboard for 2018 Entrenched Incumbent Verisk Incumbent No Prior Vended Solution Wins Losses Wins Losses Wins Losses Underwriting 30 27 7 1 23 7 & Rating Total Claims Total 13 4 5 2 8 4 InsurTech Start-ups: Engaged with 67 start-ups on 182 opportunities • Won 79 i

  11. Slide 11: Growth Complemented by Stability, Leading Margins, and Moderate CapEx

    Investor Presentation Growth Complemented by Stability, Leading Margins, and Moderate CapEx Adjusted EBITDA (1) Adjusted EBITDA Margins (1) $1,036M $1,130M 60.0% $ 1,200,000,000 $998M 50.0% $ 1,000,000,000 55.0% 50.0% 48.3% 47.2% $ 800,000,000 45.0% $ 600,000,000 40.0% $ 400,000,000 35.0% $ 200,000,

  12. Slide 12: Capital Management Philosophy

    Investor Presentation Capital Management Philosophy Focused on value creation and improving ROIC • Understand and optimize operating capital generation • Identify internal and external investment opportunities • Compare estimated returns on invested capital relative to risk-weighted WACC • Compare o

  13. Slide 13: A Differentiated Business Model

    Investor Presentation A Differentiated Business Model • Exceptional businesses with unique and defensible data sets • Substantial growth opportunities for all segments • Stable subscription revenue base with established organic growth record • Leading margins and operating leverage driving free cash

  14. Slide 14: Appendix: Supplemental Slides and Non-GAAP Reconciliations

    Appendix: Supplemental Slides and Non-GAAP Reconciliations © 2019 2017 Verisk Analytics, Inc. All rights reserved. 14

  15. Slide 15: Supplemental Slides

    Supplemental Slides © 2019 2017 Verisk Analytics, Inc. All rights reserved. 15

  16. Slide 16: Insurance

    Investor Presentation Insurance Industry-leading data analytics and insights Underwriting & Rating Solutions Claims Solutions Industry-standard insurance programs, Integrated analytics solutions for improving property-specific underwriting & rating info, claim outcomes and fighting fraud at every an

  17. Slide 17: Energy and Specialized Markets

    Investor Presentation Energy and Specialized Markets Unique insight on the world’s energy resources and intelligent compliance solutions Energy Specialized Markets Energy and natural resources solutions across Improving our understanding of the global Research & Analytics and Advisory Services envir

  18. Slide 18: Financial Services

    Investor Presentation Financial Services Big data, predictive analytics, and insights Portfolio Analytics, Regulatory Data Management, and Marketing Credit Risk Management, Fraud, and Abuse Solutions for financial institutions, including Risk management tools associated with competitive benchmarking

  19. Slide 19: Segment Trends

    Investor Presentation Segment Trends Insurance Energy Financial Organic Constant Currency Revenue Growth Organic Constant Currency Adjusted EBITDA Growth 8.7% 14.1% 9.0% 15.0% 7.3% 7.0% 7.2% 7.2% 10.0% 10.0% 5.0% 4.9% 6.7% 7.2% 7.2% 6.5% 3.1% 5.0% 3.0% 1.9% 2.5% Axis Title Axis Title 1.4% 1.5% 0.0%

  20. Slide 20: Cash Flow Utilization

    Investor Presentation Cash Flow Utilization (in $ millions) 2016 (1) 2017 2018 1Q18 1Q19 Net cash provided by operating activities $656M $744M $934M $327M $366M Capital expenditures (146) (184) (231) (43) (45) Free cash flow (FCF) 510 560 703 284 321 Acquisitions, net of cash acquired (74) (915) (15

  21. Slide 21: Non-GAAP Reconciliations

    Non-GAAP Reconciliations © 2019 2017 Verisk Analytics, Inc. All rights reserved. 21

  22. Slide 22: Non-GAAP Reconciliations

    Investor Presentation Non-GAAP Reconciliations Specified Metrics Constant Currency Growth Our operating results reported in U.S. dollars are affected by foreign currency exchange rate fluctuations because the underlying foreign currencies in which we transact change in value over time compared to th

  23. Slide 23: Non-GAAP Reconciliations: Segment Results and EBITDA

    Investor Presentation Non-GAAP Reconciliations Segment Results and EBITDA | Current and Prior-Year Period Segment Results Summary and EBITDA Reconciliation 1Q19 1Q18 Change Organic Insurance revenues $441.1M $412.1M 7.0% Organic Energy and Specialized Markets revenues 130.8M 125.5M 4.2% Organic Fina

  24. Slide 24: Non-GAAP Reconciliations: Adjusted Net Income/EPS and Free Cash Flow

    Investor Presentation Non-GAAP Reconciliations Adjusted Net Income/EPS and Free Cash Flow | Current and Prior-Year Period Adjusted Net Income and EPS 1Q19 1Q18 Change Net income $134.4M $133.0M 1.0% plus: Amortization of intangible assets 33.2M 33.2M —M less: Tax effect on amortization of intangible

  25. Slide 25: Adjusted EBITDA – Insurance Segment

    Investor Presentation Non-GAAP Reconciliations Adjusted EBITDA – Insurance Segment | Historical Full-Year Periods Insurance Segment – Adjusted EBITDA 2018 2017 2016 Organic adjusted EBITDA $908.1M $847.4M $790.1M Adjusted EBITDA from acquisitions 6.1M (3.4)M (0.1)M Adjusted EBITDA 914.2M 844.0M 790.

  26. Slide 26: Adjusted EBITDA – Energy and Specialized Markets Segment

    Investor Presentation Non-GAAP Reconciliations Adjusted EBITDA – Energy and Specialized Markets Segment | Historical Full-Year Periods Energy and Specialized Markets Segment – Adjusted EBITDA 2018 2017 2016 Organic adjusted EBITDA $144.7M $132.4M $84.6M Adjusted EBITDA from acquisitions 10.7M 1.2M 6

  27. Slide 27: Adjusted EBITDA – Financial Services Segment

    Investor Presentation Non-GAAP Reconciliations Adjusted EBITDA – Financial Services Segment | Historical Full-Year Periods Financial Services Segment – Adjusted EBITDA 2018 2017 2016 Organic adjusted EBITDA $49.8M $54.9M $54.9M Adjusted EBITDA from acquisitions 10.8M 3.5M —M Adjusted EBITDA 60.6M 58

  28. Slide 28: © 2019 Verisk Analytics, Inc. All rights reserved.

    © 2019 Verisk Analytics, Inc. All rights reserved. 28

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