Slide 1: Second Quarter 2012 Earnings Presentation
msci.com ©2012. All rights reserved. msci.com Second Quarter 2012 Earnings Presentation August 2, 2012 MSCI A Clear View of Rish and Return
Slide 2: Forward-Looking Statements – Safe Harbor Statement
msci.com ©2012. All rights reserved. 2 msci.com Forward-Looking Statements – Safe Harbor Statement This presentation may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. You should not place undue reliance on forward-looking statements be
Slide 3: Summary of Second Quarter 2012 Financial Results
msci.com ©2012. All rights reserved. Summary of Second Quarter 2012 Financial Results 3 Operating revenues increased 5% to $238.6 million versus Q2’11 Net income decreased by 18% to $37.5 million Adjusted EBITDA1 increased by 1% to $107.9 million. Adjusted EBITDA margin was 45.2% Diluted EPS for sec
Slide 4: Summary of Second Quarter 2012 Operating Results
msci.com ©2012. All rights reserved. Summary of Second Quarter 2012 Operating Results 4 Total YoY Run Rate Growth of 4% Total Sales1 and Retention Q2’12 revenues grew YoY by 5% to $239 million Q2’12 run rate (RR) grew YoY by 4% to $920 million Subscription run rate grew by 6% Asset-based fee (ABF) r
Slide 5: Index and ESG Products
msci.com ©2012. All rights reserved. Index and ESG Products 5 Index and ESG Run Rate and Revenue Highlights: Q2’12 Index and ESG products revenues grew by 7% to $110 million Q2’12 run rate grew by 4% YoY to $415 million Subscription run rate grew by 11% Asset-based fee run rate declined by 8% YoY an
Slide 6: Index and ESG Subscription
msci.com ©2012. All rights reserved. Index and ESG Subscription Index and ESG Subscription Run Rate and Subscription Revenue Highlights: Q2’12 Index and ESG subscription revenues grew by 14% to $76 million Q2’12 run rate grew by 11% YoY to $286 million Total sales were $13 million in Q2’12 Core Emer
Slide 7: Asset-Based Fee Highlights
Highlights:-- Q2’12 asset-based fee revenues declined by 6% to $34 million -- Total ABF Run Rate declined by 8% YoY and 6% sequentially to $129 million -- Total AUM fell by 9% YoY and by 8% sequentially to $327 billion at the end of Q2’12 -- Fund flows minimal in Q2’12 -- Average basis point fee rem
Slide 8: Portfolio Management Analytics
msci.com ©2012. All rights reserved. Portfolio Management Analytics Portfolio Management Analytics Run Rate and Revenue Highlights: Q2’12 portfolio management analytics revenues flat YoY at $29 million Q2’12 run rate declined by 1% YoY to $117 million New market models released in Q2 include Austral
Slide 9: Portfolio Management Analytics
msci.com ©2012. All rights reserved. Portfolio Management Analytics Portfolio Management Analytics Run Rate and Revenue Highlights: Q2’12 portfolio management analytics revenues flat YoY at $29 million Q2’12 run rate declined by 1% YoY to $117 million New market models released in Q2 include Austral
Slide 10: Governance
msci.com ©2012. All rights reserved. Governance Governance Run Rate and Revenue Highlights: Q2’12 governance revenues were unchanged YoY at $31 million Q2’12 run rate grew by 6% YoY to $114 million Total sales for Q2’12 were $6 million Sales of executive compensation data and analytics tool remain s
Slide 11: Breakdown of Q2'11 vs Q2'12 Revenue Growth
msci.com ©2012. All rights reserved. Breakdown of Q2’11 vs Q2’12 Revenue Growth 11 ($ in millions) By Product Line By Revenue Type $226.5 $238.6 $15.9 $210 $220 $230 $240 $250 Q2'11 revenue Subscription revenue Asset-based fees Non-recurring revenue Q2'12 revenue ($1.6) ($2.2) $226.5 $238.6 $7.4 $3.
Slide 12: Compensation and Non-Compensation Expense
msci.com ©2012. All rights reserved. $0$25$50 $75 $100 Q2'11 Q2'12 $82 $94 $37 $37 Compensation (1) Non-Compensation (2) Compensation and Non-Compensation Expense Comp and Non-Comp Expenses1, 2 +13% ($ in millions) (1) Compensation expense excludes non-recurring stock-based compensation. Please see
Slide 13: Summary of Profitability Metrics: Net Income, EPS and Adjusted EBITDA
msci.com ©2012. All rights reserved. Summary of Profitability Metrics: Net Income, EPS and Adjusted EBITDA1 13 $ per share -19% +6% Diluted and Adjusted 2 EPS Net Income fell 18% Debt repayment and refinancing expense of $20.6 million Effective tax rate was 34.4% in Q2’12, flat with Q2’11 Adjusted E
Slide 14: Summary Balance Sheet
msci.com ©2012. All rights reserved. June 30,December 31, In thousands 2012 2011Cash and cash equivalents 273,307 $ 252,211 $ Short-term investments 86,460 140,490 Trade receivables, net of allowances 136,074 180,566 Deferred revenue 333,890 $ 289,217 $ Current maturites of long-term debt 43,070 10,
Slide 15: Use of Non-GAAP Financial Measures
msci.com ©2012. All rights reserved. Use of Non-GAAP Financial Measures MSCI has presented supplemental non-GAAP financial measures as part of this presentation. A reconciliation is provided that reconciles each non-GAAP financial measure with the most comparable GAAP measure. The presentation of no
Slide 16: Reconciliation of Adjusted Net Income and Adjusted EPS
msci.com ©2012. All rights reserved. 16 Reconciliation of Adjusted Net Income and Adjusted EPS (Dollars in thousands, except per share figures) June 30,June 30,March 31,June 30,June 30,20122011201220122011GAAP - Net income37,546$ 45,660$ 43,966$ 81,512$ 79,181$ Plus:Non-recurring stock-based comp192
Slide 17: Reconciliation of Adjusted EBITDA to Net Income
msci.com ©2012. All rights reserved. Reconciliation of Adjusted EBITDA to Net Income 17 (Dollars in thousands, except per share figures) Performance and RiskGovernanceTotalPerformance and RiskGovernanceTotalNet income37,546$ 45,660$ Plus:Provision for income taxes19,715 23,982 Plus:Other expense (in
Slide 18: Reconciliation of Operating Expenses
msci.com ©2012. All rights reserved. Reconciliation of Operating Expenses 18 (Dollars in thousands, except per share figures) June 30,June 30,March 31,June 30,March 31,In thousands20122011201220112012Cost of servicesCompensation55,492 $ 48,118 $ 53,549 $ 15.3%3.6% Non-recurring stock based comp94 1,