S&p Global Inc. · NYSE:SPGI
S&p Global — The McGraw-Hill Companies — Investor Presentation (December 2011)
21 slides from S&p Global's investor presentation, Dec 7, 2011
Slide 1: Growth and Value Plan Update
Growth and Value Plan Update Investor Relations Presentation December 7, 2011
Slide 2: Forward-Looking Statements
Forward-Looking Statements The forward-looking statements in this Growth and Value Plan (identified by the future tense and words like “expects,” “targeted” and “projected”) involve risks and uncertainties, are subject to change, and actual results may differ materially from the Corporation’s expect
Slide 3: Agenda
I. Progress on The McGraw-Hill Companies’ Growth and Value Plan II. McGraw-Hill Financial III. McGraw-Hill Education 2
Slide 4: Progress on the Growth & Value Plan
Progress on the Growth & Value Plan • The newly named McGraw-Hill Financial1 to focus on content and analytics in global financial markets, reporting results in five lines of business • McGraw-Hill Education reduces workforce by approximately 10% (~550 positions); to increase investment in digital e
Slide 5: Cost savings & share repurchase update
Cost savings & share repurchase update • The McGraw-Hill Companies has taken substantial actions to achieve cost reductions of Cost approximately $50 million in annualized savings, making the Corporation highly confident Savings that it will exceed its initial target of $100 million • McGraw-Hill Ed
Slide 6: II. McGraw-Hill Financial
I. Progress on The McGraw-Hill Companies’ Growth and Value Plan II. McGraw-Hill Financial III. McGraw-Hill Education 5
Slide 7: Four key trends are increasing the need for content and analytics in financial markets
Four key trends are increasing the need for content and analytics in financial markets Trend Description Customer Needs For Content and Analytics • Global demand for capital and commodities markets trading and liquidity Globalization of • Increased demand for capital in emerging capital markets mark
Slide 8: The demand for content and analytics outpaces the growth of GDP and the underlying industries
The demand for content and analytics outpaces the growth of GDP and the underlying industries Value of Information 3-Year Projected Growth Rates 8.7% rs Integrated me Solutions sto Cu Credit Indices 3.6% to Ratings 3.0% dd e-A Portfolio Equity & Comm- lu Risk Fixed Inc. odities Va Analytics Analytic
Slide 9: A wide range of players are creating value by adding content and analytics capabilities
A wide range of players are creating value by adding content and analytics capabilities to their core businesses Exchanges • CME JV with S&P Indices to secure Equity & Fixed Income Info. access to key index Asset Managers Rationale intellectual property • Platts eWindow drives • Content and commodit
Slide 10: McGraw-Hill Financial is already positioned as a leader in content and analytics
McGraw-Hill Financial is already positioned as a leader in content and analytics Content and Analytics-led Platform-led McGraw-Hill Financial Markets LTM Revenue ~$4,000 $2,278 $1,258 $888 $727 $624 $853 $7,736 NA ($ in millions) Credit Ratings Indices Equity and Fixed Income Analy
Slide 11: McGraw-Hill Financial is going to grow three ways
McGraw-Hill Financial is going to grow three ways 1 2 Leverage Brand Expand Cross- Strength & Business Expertise Synergies McGraw-Hill Financial Growth Strategy 3 Pursue Acquisitions and Alliances 10
Slide 12: McGraw-Hill has consistently demonstrated the ability to build high value, double-digit growth businesses
McGraw-Hill has consistently demonstrated the ability to build high value, double-digit growth businesses 1986 1994 2011 • ~900 staff members • Executes 8,500 price assessments in • 12 staff members over 150 countries • One office Platts 12% Revenue CAGR • Oil, gas, petrochemicals, power, coal, • On
Slide 13: McGraw-Hill Financial will be reported in five lines of business
McGraw-Hill Financial will be reported in five lines of business… McGraw-Hill Financial Standard & Commercial Poor’s Ratings S&P Capital IQ S&P Indices Commodities Markets Services Note: Joint venture with Dow Jones Indexes subject to regulatory approval 12
Slide 14: Go-to-market with an operating model combining deep content expertise and horizontal capabilities
…and go-to-market with an operating model combining deep content expertise and horizontal capabilities Customers Benefits S&P Capital Commercial • Focus and depth in Businesses S&P Ratings S&P Indices Commodities IQ Markets five businesses Proprietary Channel Partners Distribution Direct Data Feeds
Slide 15: McGraw-Hill Financial will accelerate growth by expanding cross-business synergies
McGraw-Hill Financial will accelerate growth by expanding cross-business synergies Integrated Providing integrated solutions within and across market Solutions segments that fill evolving customer needs Capturing additional revenue by leveraging and expanding Distribution McGraw-Hill Financial’s str
Slide 16: Existing cross-business collaboration has already resulted in high-value integrated solutions
Existing cross-business collaboration has already resulted in the creation of high-value integrated solutions Shared Capabilities… …enable High-Value Solutions • S&P Ratings, S&P Capital IQ and S&P • Structured Finance investors use proprietary Indices cash flow and credit models that use S&P Rating
Slide 17: Summary
Summary • McGraw-Hill Financial will be a focused operating company and be reported in five business lines: Standard & Poor’s Ratings Services, S&P Capital IQ, S&P Indices, Platts and Commercial Markets • This structure will enable the company to build on its specialized market knowledge and create
Slide 18: III. McGraw-Hill Education
I. Progress on The McGraw-Hill Companies’ Growth and Value Plan II. McGraw-Hill Financial III. McGraw-Hill Education 17
Slide 19: McGraw-Hill Education is creating a flatter, more nimble company
McGraw-Hill Education is creating a flatter, more nimble company to drive margin expansion and invest in attractive growth opportunities • A workforce reduction of approximately 10% (~550 positions) Executive ranks reduced by approximately 20% Workforce reductions are expected to be substantiall
Slide 20: McGraw-Hill Education is evolving its business to capitalize on the changing education market
McGraw-Hill Education is evolving its business to capitalize on the rapidly changing education market Education Market Transformation Changing Customers Evolving McGraw-Hill Education is Channels changing by… …embracing more agile product development Solutions …moving decisions closer to customers a
Slide 21: Educational Services
These trends demonstrate attractive growth prospects for educational service providers – a space McGraw-Hill Education is targeting U.S Commercial U.S. Commercial Education, 2010-2014F Education, 2010-2014F CAGR Operating ('10-'14) Margins $125B 10% Tech 6% ~10% Support 5% 10-20% Services Content 0-
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