Morningstar, Inc. · NASDAQ:MORN
Morningstar — Q4 2016 Earnings Presentation
14 slides from Morningstar's earnings presentation, Feb 21, 2017
Slide 1: Fourth-Quarter and Full-Year 2016 Financial Highlights
Fourth-Quarter and Full-Year 2016 Financial Highlights February 21, 2017 ©2017 Morningstar, Inc.
Slide 2: Key Operating Metrics
Key Operating Metrics ► Revenue for the quarter was $212.2 million, an increase of 5.3% compared with the same period in 2015. For the year, revenue was $798.6 million, an increase of 1.2% compared with $788.8 million in 2015. Organic revenue, which excludes acquisitions, divestitures, and the effec
Slide 3: Comparability of Year-Over-Year Results
Comparability of Year-Over-Year Results ► Net income for the fourth quarter and full year in 2016 included a holding gain of $37.1 million, or 86 cents per share, in connection with Morningstar’s December 2016 acquisition of the remaining ownership interest in PitchBook Data, Inc. (PitchBook). The h
Slide 4: Update on Key Investment Areas
Update on Key Investment Areas ► Total assets under management and advisement for Workplace Solutions rose 16.4% during the year to $104.4 billion. ► Licenses for Morningstar Direct rose 9.3% to 12,492 as of Dec. 31, 2016, compared with 11,428 as of Dec. 31, 2015. ► Assets under management and advis
Slide 5: Balance Sheet and Capital Allocation
Balance Sheet and Capital Allocation ► As of Dec. 31, 2016, the company had cash, cash equivalents, and investments totaling $304.0 million and $250.0 million of long-term debt, compared with cash, cash equivalents, and investments of $248.6 million and $35.0 million of short-term debt as of Dec. 31
Slide 6: Fourth-Quarter 2016 Key Metrics ($mil)
Fourth-Quarter 2016 Key Metrics ($mil) Revenue Operating Free Cash Flow* Income +5.3% -0.5% +55.5% 15 16 15 16 15 16 $201.6 $212.2 $50.1 $49.9 $35.5 $55.2 *Free cash flow is a non-GAAP financial measure.
Slide 7: Full-Year 2016 Key Metrics ($mil)
Full-Year 2016 Key Metrics ($mil) Revenue Operating Free Cash Flow 1 Income +1.2% -5.2% -18.1% 15 16 15 16 15 16 $788.8 $798.6 $190.6 $180.8 $184.2 $150.9 1 Free cash flow is a non-GAAP financial measure.
Slide 8: Revenue for Top Five Products ($mil)
Revenue for Top Five Products ($mil) Year ended December 31 (in millions) 2016 2015 change Morningstar Data $152.1 $144.5 5.3% Morningstar Direct 110.5 101.7 8.7% Morningstar Investment Management 98.4 98.8 (0.4%) Morningstar Advisor Workstation 82.4 81.4 1.2% Workplace Solutions 71.3 66.6 7.0% 8
Slide 9: Quarterly Operating Income ($mil)
Quarterly Operating Income ($mil) $60.0 $50.0 $40.0 $30.0 $20.0 $10.0 $0.0 Q4 15 Q1 16 Q2 16 Q3 16 Q4 16 9
Slide 10: Quarterly Operating Margin (%)
Quarterly Operating Margin (%) 26.0% 25.0% 24.0% 23.0% 22.0% 21.0% 20.0% Q4 15 Q1 16 Q2 16 Q3 16 Q4 16 10
Slide 11: Balance Sheet ($mil)
Balance Sheet ($mil) As of December 31, 2016 2015 Cash, cash equivalents, and investments $ 304.0 $ 248.6 Working capital 177.1 105.5 Total assets 1,350.9 1,029.0 Deferred revenue 165.4 140.7 Short- and long-term debt 250.0 35.0 Total equity 696.8 640.6 11
Slide 12: Reconciliation of Non-GAAP Measure with the Nearest Comparable GAAP Measure ($mil)
Reconciliation of Non-GAAP Measure with the Nearest Comparable GAAP Measure ($mil) Three months ended Year ended December 31, December 31, 2016 2015 2016 2015 Cash provided by operating activities $ 70.5 $ 52.9 $ 213.7 $ 241.5 Less: capital expenditures (15.3) (17.4) (62.8) (57.3) Free cash flow $55
Slide 13: Reconciliation of Non-GAAP Measure with the Nearest Comparable GAAP Measure ($mil)
Reconciliation of Non-GAAP Measure with the Nearest Comparable GAAP Measure ($mil) Three months ended Year ended December 31, December 31, 2016 2015 2016 2015 Consolidated revenue $ 212.2 $ 201.6 $ 798.6 $ 788.8 Less: divestitures -- -- -- -- Less: acquisitions (4.5) -- (5.5) -- Unfavorable effect o
Slide 14: Morningstar
MORNINGSTAR