Moody's Corporation · NYSE:MCO
Moody's — FY2020 Earnings Presentation
75 slides from Moody's's earnings presentation, Feb 26, 2021
Slide 1: 4Q & FY 2020 Investor Presentation
4Q & FY 2020 Investor Presentation February 26, 2021
Slide 2: Disclaimer
Disclaimer Certain statements contained in this release are forward-looking statements and are based on future expectations, plans and prospects for the business and operations of Moody’s Corporation (the “Company”) that involve a number of risks and uncertainties. Such statements may include, among
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 Solutions 7. Appendix Moody’s | Better decisions 4Q & FY 2020 Investor Presentation 3
Slide 4: Moody's Overview
1 Moody’s Overview
Slide 5: Company Overview
Company Overview Global integrated risk assessment Independent provider of firm, providing credit rating Provides financial intelligence credit rating opinions and opinions, insight and tools for risk and analytical tools related information for over measurement and management supporting our custome
Slide 6: Moody's Has Evolved Over the Last 15 Years
2006 – 2016 Expanded beyond rating agency Moody’s Has » Established Moody’s Analytics Evolved Over » » Built the ERS business (e.g., Fermat, B&H) Expanded ratings to China (i.e., CCXI) the Last 2017 – 2020 Built-out substantial data and analytics capabilities 15 Years » Complemented ERS business wit
Slide 7: Moody's as an Integrated Risk Assessment Business
Moody’s as an Integrated Risk Assessment Business Supply chain management $35B+ Helping customers make Transfer pricing & trade credit Total Addressable Market BETTER DECISIONS Fixed income CURATED DATA investing Commercial lending Entities Securities ~400 million $70+ trillion public & private enti
Slide 8: Key Strategic Investments To Drive Further Growth
Key Strategic Investments To Drive Further Growth COMMERCIAL REAL ESTATE KYC AND COMPLIANCE CHINA AND LATIN AMERICA Develop new analytic tools to serve Deepen curated data sets, nurture Build out local talent and enhance diverse CRE market, accelerate data the development of new use cases domain-spe
Slide 9: Financial Overview
2 Financial Overview
Slide 10: Moody's Corporation Financial Profile
Moody’s Corporation Financial Profile Full Year 2020 Revenue: $5.4 billion MIS Other1 Recurring Transaction U.S. Non-U.S. 1% PPIF 44% 45% 9% RD&A FIG 28% MIS 10% MA SFG 7% ERS CFG 11% 56% 55% 34% Full Year 2021 Guidance as of February 12, 20212 Revenue » Increase in the mid-single-digit % range Effe
Slide 11: Macro Assumptions Underpinning Our Outlook
1 Macro Assumptions Underpinning Our Outlook 2021 GDP Benchmark interest rates remain low; U.S. high-yield 4.0% – 5.0% United States spreads below 450 bps 3.5% – 4.5% Euro area 4.5% – 5.5% Global U.S. unemployment rate Global high yield default rate of 5% - 6% by year-end falling below 5% by year en
Slide 12: Financial Performance
Financial Performance1 Revenue2 Adjusted Diluted EPS3 $ Billions $ Per Share $10.30 - $10.70 MIS Revenue MA Revenue Mid-single-digit % $11.00 $7.0 growth $10.00 $6.0 $5.4 $9.00 $4.8 $8.00 $5.0 $4.2 $4.4 $3.6 $2.1 $7.00 $4.0 $2.0 $1.4 $1.7 $6.00 $10.15 $3.0 $1.2 $8.29 $5.00 $7.39 $2.0 $4.00 $6.07 $2.
Slide 13: Long-Term Growth Opportunities
Long-Term Growth Opportunities Three levers to achieve EPS growth REVENUE High Single Digit % Growth Range1 Issuance Volume & Mix Coverage Moody’s Analytics Pricing Initiatives ADJ. OPERATING MARGIN High-40s % Range1 Cost Discipline Process Re-Engineering Technology Enablement Investing for future g
Slide 14: Capital Allocation Strategy
Capital Allocation Strategy Prudent approach in uncertain times Capital allocation goals Capital allocation levers INVESTING IN GROWTH OPPORTUNITIES Reinvestment Acquisitions RETURN OF CAPITAL Dividends Anchored around Ensure adequate Provide Meet return Manage risk Share repurchase a BBB+ rating fi
Slide 15: Investment Criteria and Post Acquisition Review
Investment Criteria and Post Acquisition Review Clear Industrial Logic Disciplined Financial Targets Post-Acquisition Review Strategic fit is the most important factor and the Long held, clear financial framework for Disciplined and rigorous monitoring post close first screen external (and internal)
Slide 16: Key Takeaways
Key Takeaways Growth Company Operational Excellence Disciplined Capital Allocation » Long-term financial expectations » Strategic initiatives generate » Emphasis on returning excess remain robust cost efficiencies, enabling capital to stockholders through » Balanced revenue model reinvestment and ma
Slide 17: Capital Markets Overview
3 Capital Markets Overview
Slide 18: MIS Issuance Spotlight
MIS Issuance Spotlight 2020 CFG Issuance 34% Above Prior 5 Year Average ($ Billions) 1 Investment Grade Speculative Grade Bank Loans 2015-2019 Average 2,900 » Balance sheet fortification and increasingly $2,637 $1,973 $2,264 2,400 favorable conditions led many corporates 2015-2019 Avg. $1,955 $562 $
Slide 19: Refunding Needs Continue to Build
Refunding Needs Continue to Build Next four years North America and EMEA total refunding needs1 as of: $4,000 $3,806 10% $3,466 $3,500 $3,000 $ Billions $2,500 $1,972 $2,000 $1,500 $1,000 Jan '12 Jan '13 Jan '14 Jan '15 Jan '16 Jan '17 Jan '18 Jan '19 Jan '20 Sep '20 1. Amount reflects total maturit
Slide 20: Refunding Needs Support MIS Long-term Fundamentals
Refunding Needs1 Support MIS Long-term Fundamentals Debt Maturities: North America Moody’s-Rated Corporate Bonds and Loans2 $624 » Approximately $1.8 trillion of $532 non-financial corporate debt $ Billions 311 maturing in North America $387 205 Speculative Grade Bank Loans $252 86 Speculative Grade
Slide 21: 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 Companies Debt / EBITDA EBITDA / Interest Expense 8.0x Interest Coverage 5.5x 6.0x 6.0x 5.1x 5.2x 5.3x 5.5x 5.4x 4.6x 4.6x 4.7x 4.5x 4.6x 4.9x 4.3x 4.4x 4.0x 2.9x 2.6x 2.7x 2.9x 3.0x 3.0x
Slide 22: Default Rate Expected to Improve
Default Rate Expected to Improve Default Rates for Speculative-Grade Speculative-Grade Covenant Corporate Rated Issuance1 Quality Indicators2 Global U.S. Europe U.S. Loans U.S. Bonds European Bonds Weakening 16% 5.0 14% 4.5 4.4x 12% 4.0 4.1x 10% 4.2% global 3.9x historic average1 8% 3.5 6% 5.4% 3.0
Slide 23: Disintermediation of Credit is an Ongoing Trend
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 €8,000 $10,500 €7,000 $9,000 €6,000 48% $7,500 €5,000 4 $ Billions € B
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 Full Year 2020 Revenue: $3.3 billion » 25% recurring revenue U.S. Recurring » 32% recurring revenue Non-U.S. Transaction MIS Other 1% 37% Corporate Public, Project, Finance & Infrastructure 66% 57% Finance 15% Financial 63% Institutions 16% 34% Structured
Slide 26: MIS 2021 Guidance: Transactional Orientation Benefits Revenue
MIS 2021 Guidance: Transactional Orientation Benefits Revenue Revenue Adjusted Operating Margin1 FY 2021 Issuance Guidance1,2 $3.3B Approximately flat 59.7% Approximately 60% 15%-20% ~10% ~(5%) Decline in the high-single- digit % range ~(30%) 1 Investment High Yield Leveraged Structured Total 3 2020
Slide 27: 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 28: Illustrative Value of a Moody's Rating
Illustrative Value of a Moody’s Rating Example: 10 year $500 million corporate bond Not Rated by Moody’s Rated by Moody’s $500,000,000 Bond $500,000,000 x 2.5% Interest rate x 2.1% = $12,500,000 Annual interest payments = $10,500,000 x 10 years Tenor x 10 years = $125,000,000 Lifetime interest expen
Slide 29: Managing Ratings in Turbulent Times
Managing Ratings in Turbulent Times Transparency and relevance of credit ratings through the cycle Order sectors by degree Order issuers by Reassess all Reassess ratings Monitor credit profiles Coordinate Take account of of exposure vulnerability ratings in the most of the most associated with all o
Slide 30: MIS Facts and Figures: Full Year 2020
MIS Facts and Figures: $70+ PEOPLE 11,400+ trillion Full Year 2020 Total rated debt MCO employees 1,000+ Analysts 35,000+ 40+ Rated Organizations and Structured Deals AMERICAS EMEA ASIA PACIFIC Countries/Regions TOTAL RATED DEBT 5,000+ 3,600+ $37.8+ trillion $19.8+ trillion $11.7+ trillion EVENTS No
Slide 31: Strongly Positioned in Emerging Markets
Strongly Positioned in Emerging Markets Emerging Markets - Domestic TAM MIS Emerging Markets Revenue1 Chile Malaysia MIS Affiliate (majority) Others MIS Affiliate (minority) Moody’s Local South Africa National Scale Ratings $411M Brazil Other Emerging Markets Mexico Argentina China Peru Egypt $700M
Slide 32: Moody's in Greater China
Moody’s in Greater China 2nd Largest Onshore Bond Market at $15 Trillion Revenue and Attributable Income from China2 Total debt securities outstanding 2012–20201 MIS Cross Border Revenue Total MA Revenue Attributable Income from CCXI 2012 2020 180 $169 50 5% 160 140 $ Millions 40 120 30 100 22% -1%
Slide 33: Moody's Analytics
5 Moody’s Analytics
Slide 34: Moody's Analytics Financial Profile
Moody’s Analytics Financial Profile Full Year 2020 Revenue: $2.1 billion » 95% recurring revenue1 » 94% retention rate2 U.S. Recurring Non-U.S. Transaction 9% Research, Data 57% and Analytics 73% 91% Enterprise Risk 43% Solutions 27% » 79% recurring revenue » 92% retention rate 1. Recurring revenue
Slide 35: MA 2021 Guidance: Revenue Growth and Reinvestment
MA 2021 Guidance: Revenue Growth and Reinvestment to Drive Future Expansion Revenue Adjusted Operating Margin1 Low-double-digit % increase 29.4% Approximately 30% $2.1B 1 1 2020 2021F 2020 2021F Key drivers of MA FY 2021 outlook1 » ~93% recurring revenue » ERS: Strong growth in recurring revenue, pa
Slide 36: Moody's Analytics Has Several Platforms for Growth
Moody’s Analytics Has Several Platforms for Growth Revenue Has More Than Tripled Since Inception Moody’s Analytics 2020 Revenue: $2,079m $2,000 2008 – 2020 CAGR: +12% (~63% organic) $1,500 Enterprise Risk Solutions 2020 Revenue: $565M $ Millions 2008 – 2020 CAGR: +14% (~68% organic) $1,000 Research,
Slide 37: Healthy Growth in MA's Recurring Revenue Supports Margin Expansion
Healthy Growth in MA’s Recurring Revenue Supports Long-term Margin Expansion Amidst Investment MA RECURRING AND TRANSACTION REVENUE MA ADJUSTED OPERATING MARGIN 2 EXPANSION % Transaction % Recurring Recurring Revenue 29.4% ~$1.9B 27.8% 84% 26.4% 78% 85% 91% ~$1.1B 24.6% 22% 16% 15% 9% 2017 2018 2019
Slide 38: Diverse Product Solutions
Diverse Product Solutions Continuous expansion and refinement of content, tools and user experience to help customers make better and faster decisions Integrated Experience: Ease of Use Enhanced Content & Coverage: More Value 1,500+ 2,900+ Asset Managers Commercial Banks Compliance modules Onboard c
Slide 39: Curated Data Combined with Analytics Foundation of Strategy
Curated Data Combined with Analytics are the Foundation of our Integrated Risk Assessment Strategy Domain Expertise Curated Data Best in Class Analytics Portfolio News Monitoring Climate CRE Economic Modeling MA’s approach to deepening Proprietary data assets Risk available data sets and Financials
Slide 40: RD&A Enables Better Decisions through Data and Insights
RD&A RD&A Enables Better Decisions through Data and Insights Our business solutions Our customers Research Data Insurers Opinions and insights Public and private that explain ratings, company information1 methodologies and markets MIS Ratings Banks Corporates Customers Economics Commercial Real Esta
Slide 41: Curated Company Data Is the Foundation for High Value Solutions
RD&A Curated Company Data Is the Foundation for Multiple High Value Solutions High Value Customer Solutions KYC, compliance and financial crime Corporate finance and M&A Conduct on-boarding and anti-money laundering research with Find targets/sellers, perform M&A/deal analysis and conduct due extens
Slide 42: Bringing it All Together
RD&A Bringing it All Together Comprehensive suite of data assets to serve a range of KYC, compliance Private Company and Trade Credit Data and financial crime use cases Private Company Data » Global database, with a » 36M+ North American business focus in EMEA and APAC profiles ~$525M » 156M benefic
Slide 43: 2020 RD&A Growth Driven by KYC and Compliance, Research and Data Feeds
RD&A 2020 RD&A Growth Driven by KYC and Compliance, Research and Data Feeds Subscription Sales Growth (constant currency) 110% Full Year 94% 8% 9% 2020 Expansion of ratings coverage Retained Base Upgrades and Price New Sales Business Base (including BvD) (including BvD) Production of insightful cred
Slide 44: ERS Empowers Customers' Success With Analytics
ERS ERS Empowers Customers’ Success With Analytics Technology with a purpose – enabling better, faster decisions Our business solutions Our customers Accounting Balance sheet Insurers management Impairments, Portfolio, valuation IFRS-17 and ALM1 Banks Corporates Customers Credit decisioning & RegTec
Slide 45: ERS: ~80% Recurring Revenue; Mid-teens Subscription CAGR
ERS ERS: ~80% Recurring Revenue; Mid-teens Subscription CAGR ERS Revenue: Recurring1 vs. Non-recurring Recurring Revenue CAGR2 = 14% » ERS recurring revenue has grown by $500 approximately $200 million since 2015 79% » Emphasis on subscription products supports $400 scalability, drives operating lev
Slide 46: Global Regulatory and Accounting Drivers for the ERS Business
ERS Global Regulatory and Accounting Drivers for the ERS Business EMEA BoE/ PRA Output floor ST BoE/ PRA BES Incorporate ESG risks into Revised SA supervisory process CVA review operational risk FRTB Updated HLA requirement Leverage Ratio Revised IRB approach CR Revised SA Revised minimum market ris
Slide 47: ESG Solutions
6 ESG Solutions
Slide 48: ESG Market Overview
ESG Market Overview Market Trends Sustainable bonds set for Spend on ESG data & » Multiple drivers and stakeholders supporting the growth of ESG, with record volumes1 metrics growing rapidly2 increasing relevance to corporates, banks, insurers, investors, 1,000 Annual Spending ($ millions) 700 Annua
Slide 49: Priorities for Strategic Growth: ESG Integrated Across All Platforms
Priorities for Strategic Growth: ESG Integrated Across All Platforms, Driving Growth and Enhanced Relevance MIS Integration MA Integration Moody’s ESG Solutions Real Estate Moodys.com ESG Measures Climate Solutions Solutions Credit Ratings & ESG Credit Scores Research Risk Analytics & regulatory rep
Slide 50: MIS: Four Components to MIS Integration of ESG
MIS: Four Components to MIS Integration of ESG New ESG scores will assist in transparently and systematically demonstrating the impact of ESG on credit ratings Credit Ratings & Research ESG Credit Scores ESG Classification Heat Maps How is ESG integrated into How is a specific issuer What is ESG? Is
Slide 51: MA: ESG Integrated into Multiple Offerings
MA: ESG Integrated into Multiple Offerings » ESG & Physical Climate Risk Scores » All of Moody’s data on a centralized platform » ESG Company and Sector Reports » ESG, climate risk and controversy data » MIS Sector Heatmaps & classifications » MIS Entity CTA & CGA scores ESG Score Predictor MA Clima
Slide 52: Moody's ESG Solutions Group
Moody’s ESG Solutions Group A leader in ESG: providing a range of risk management, equity and credit market solutions SME Solutions » Brings together over 30 years of ESG expertise in Climate Index a single global group Solutions Solutions » Provides data and analytics to MIS, MA and external custom
Slide 53: MESG Current Solution Suite
MESG Current Solution Suite ESG Measures Index Solutions » Data, Scores & Benchmarks » 75+ Indices (Equity & Fixed » Assessments & Research Income) » Controversy Monitoring & Alerts » 10+ Partnerships » Positive/Negative Screening » Benchmarking Data » Portfolio Review » ETFs, Listed & OTC Derivates
Slide 54: Moody's ESG 2020 Snapshot
Moody’s ESG 2020 Snapshot1 30+ 5,000+ 10 Million + Years of dedicated ESG experience ESG assessments Climate Risk Scores Pioneering ESG analysis since 19832 Covering 273 unique ESG data points Spanning countries, counties, cities, companies & real estate assets globally 1,900+ 100,000+ ~25 MIS resea
Slide 55: Appendix
7 Appendix
Slide 56: 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 Other 2 Investment Grade Speculative Grade Bank Loans U.S. Speculative-Grade Bank Loans Non-U.S. Speculative-Grade Bank
Slide 57: 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% 80% 25% 20% 25% 25% 31% 30% 29% 28% 31% 29% 30% 80% 65% 68% 62% 66% 62% 65% 67% 68% 69% 72% 70% 60% 60% 40% 40% 75% 80% 7
Slide 58: 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 $160 $350 $140 $300 $120 $0 $44 $ Millions $250 $ Billions $1 $1 $49 $49 $100 $1 $1 $57 $31 $47 $1 $0 $36 $39 $41 $32 $0 $200 $38 $80 $35
Slide 59: 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% 80% 36% 39% 43% 42% 44% 45% 48% 49% 61% 56% 61% 56% 59% 57% 53% 52% 63% 64% 64% 62% 63% 64% 60% 60% 40% 40% 64% 61%
Slide 60: 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 $160 $2 $140 $2 $500 $3 $3 $8 $3 $3 $3 $6 $30 $120 $3 $8 $
Slide 61: 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% 40% 42% 45% 42% 42% 44% 47% 47% 48% 49% 80% 46% 51% 54% 55% 52% 50% 52% 50% 58% 59% 58% 60% 60% 40% 40% 56%
Slide 62: Public, Project and Infrastructure: Revenue and Issuance
Public, Project and Infrastructure: Revenue and Issuance1 Revenue2: Mix by Quarter Issuance3: Mix by Quarter Public Finance and Sovereign Project and Infrastructure Finance Other Long-Term Rated U.S. Muni Bonds Rated Global Project and Infrastructure Finance Bonds $150 $250 $200 $ Millions $ Billion
Slide 63: 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% 34% 31% 33% 28% 31% 34% 32% 80% 80% 39% 41% 35% 37% 59% 65% 64% 61% 64% 63% 62% 65% 62% 61% 63% 60% 60%
Slide 64: Moody's Analytics: Financial Overview
Moody’s Analytics: Financial Overview Professional Services Enterprise Risk Solutions Research, Data and Analytics Revenue1: Mix by Quarter Revenue1: Distribution by Line of Business Revenue1: Mix by Year $2,400 $600 100% 6% 8% 0% 9% 9% 9% 9% $2,000 $500 $31 $151 28% 26% 27% 27% 27% $159 $565 $43 $1
Slide 65: Historically, Moody's Revenue and Interest Rates Have Not Been Strongly Correlated
Historically, Moody’s Revenue and Interest Rates Have Not Been Strongly Correlated MCO Revenue and Interest Rates 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% +120bps 8% $6,000 7% 6.5% +100bps $ Millions $5,000
Slide 66: Proactive Capital and Liquidity Management
Proactive Capital and Liquidity Management Bond portfolio WAC1 Balanced maturity schedule5 $ in millions 1000 5.0% 4.7% 900 4.3% 4.3% 800 4.5% 3.9% 700 4.0% 3.5% 3.3% 3.3% 600 4.2% 3.3% 300 3.5% 3.9% 4.0% 500 918 3.0% 3.4% 3.4% 400 250 2.4% 300 330 612 600 2.5% 2.1% 2.4% 500 500 500 200 400 400 400
Slide 67: Drivers of Sustainable Corporate Value
ENVIRONMENTAL Drivers of Sustainable Corporate Value SOCIAL Sustainability Disclosures in our Public Filings GOVERNANCE ENVIRONMENTAL » Focused on reducing greenhouse gas emissions with science- » Moody’s and its subsidiaries engages with a multitude of based targets1 on our path to net-zero Sustain
Slide 68: Drivers of Sustainable Corporate Value
ENVIRONMENTAL Drivers of Sustainable Corporate Value SOCIAL Sustainability Disclosures in our Public Filings GOVERNANCE SOCIAL GOVERNANCE » Support a diverse, equitable and inclusive workplace » Professional integrity » Launched DE&I portal » Systematic risk management » Active global community and
Slide 69: Technology: Innovating with Purpose
Technology: Innovating with Purpose Next Gen Tech is a Defining Element of our Culture, Setting Stage for Growth » Incorporating alternative data sources to augment » NLP based early warning and monitoring tools for SME credit scoring accuracy MIS analysts and MA customers » QuantCube pilot program
Slide 70: Moody's Global Presence
Moody’s Global Presence Americas Argentina Mexico Brazil Panama Canada Peru Chile United States Costa Rica Europe, Middle East & Africa Austria Poland Belgium Portugal Cyprus Russia Czech Republic Saudi Arabia Denmark Slovak Republic France South Africa Germany Spain Israel Sweden Italy Switzerland
Slide 71: Reconciliation of Adjusted Financial Measures to GAAP
Reconciliation of Adjusted Financial Measures to GAAP Moody's Corporation Adjusted Operating Income and Adjusted Operating Margin Reconciliation1 Moody's Corporation Net Debt Reconciliation (in $ millions) 2015 2016 2017 2018 2019 2020 (in $ millions) 2015 2016 2017 2018 2019 2020 Operating Income $
Slide 72: Reconciliation of Adjusted Financial Measures to GAAP (cont.)
Reconciliation of Adjusted Financial Measures to GAAP (cont.) Moody's Corporation Operating Margin Guidance Reconciliation 2021F1 Projected Operating Margin - GAAP Approximately 45% Depreciation & Amortization Approximately 4.5% Restructuring Negligible Projected Adjusted Operating Margin 49 - 50% F
Slide 73: Reconciliation of Adjusted Financial Measures to GAAP (cont.)
Reconciliation of Adjusted Financial Measures to GAAP (cont.) Moody's Corporation Diluted EPS Reconciliation 2015 2016 2017 2018 2019 2020 2021F1 Diluted EPS - GAAP $4.63 $1.36 $5.15 $6.74 $7.42 $9.39 $9.70 – $10.10 Legacy Tax (0.03) - - - - - - Impact of Litigation Settlement - $3.59 - - - - - Capt
Slide 74: Investor Relations
Investor Relations ir.moodys.com ir@moodys.com moodys.com
Slide 75: Moody's | Better decisions
© 2021 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