10 July 2008
Experian, the global information services company, today issues an update on trading for the three months to 30 June 2008.
Commenting on the performance of Experian, Don Robert, Chief Executive Officer, said:
“The strategic moves we have undertaken to balance the Experian portfolio have again enabled the Group to withstand the market challenges in the US and the UK. Total revenue growth was 21% in the first quarter, with organic revenue growth of 1%, against strong comparables.
“Looking ahead, while we do not plan on the basis of any short-term recovery in the US and UK financial services markets, we expect strength in new geographies and across many business lines to support Group revenue growth. Our cost efficiency programme is progressing well, and we remain focused on driving profit growth.”
|Continuing activities only1||Total growth %|
At actual exchange rates2
|Total growth %|
At constant exchange rates
|Organic growth %|
At constant exchange rates
|Latin America||>100 3||>100 3||54|
|UK and Ireland||7||5||1|
In the three months to 30 June 2008, revenue from continuing activities at Experian increased by 16% at constant exchange rates. Group organic revenue growth was 1% year-on-year. There was good organic revenue growth at Interactive, up 8%, and Decision Analytics, up 5%. Marketing Services was flat, while, as expected, Credit Services declined by 4%, reflecting challenging market conditions, particularly in the US. Acquisitions contributed 15% to revenue growth.
Revenue in North America for the three months ended 30 June 2008 increased by 1% in total. Organic revenue was flat. The acquisition of Hitwise (acquired in June 2007) accounts for the difference.
As expected, and against strong comparables, organic revenue declined by 5% at Credit Services. Conditions in mortgage and pre-screen continued to be weak, partially mitigated by strength in portfolio management and collections, currently major focus areas for financial services clients. At Decision Analytics, the pipeline remains strong, but sales cycles are long. Organic revenue declined by 6%, against significant one-off revenue last year. Organic revenue growth in Marketing Services was 2%, as continued strength in new media activities offset weaker conditions for traditional activities. In Interactive, organic revenue growth was 5%. Strong demand for membership services drove further excellent performance at Consumer Direct, offset by continued weakness in the mortgage vertical at Experian Interactive Media.
Revenue for Latin America in the three-month period to 30 June 2008 was US$128m (prior year US$3m), including the contributions from Informarketing and Serasa, acquired respectively in April 2007 and June 2007. Organic revenue increased by 54%, off a low base.
Revenue at Serasa performed strongly, in line with the buy plan, reflecting good performances across vertical channels such as retail, insurance and credit card, plus new wins in the financial services sector. There was also an excellent performance at Marketing Services, which benefited from a series of new business wins.
Revenue in UK and Ireland from continuing activities for the three months ended 30 June 2008 increased by 5% at constant exchange rates. Organic revenue rose 1%, with acquisitions, including Tallyman (acquired in May 2007), Hitwise, The pH Group (acquired in July 2007) and N4 Solutions (acquired in July 2007), contributing the balance.
While conditions for the UK financial services sector continue to be challenging, Credit Services organic revenue declined only modestly in the quarter, by 2%, helped by growth in business information. Decision Analytics improved, up 4% organically, reflecting new business wins and strength in customer management, analytics and scorecard rebuilds. Meanwhile, Tallyman continues to perform very strongly, as does N4 Solutions, the mortgage sector and financial services software provider. Conditions for Marketing Services continue to be challenging, impacted by the weak environment for financial services, with organic revenue down 7%. Interactive performed very strongly, up 50% organically, driven by strength in new CreditExpert memberships.
At constant exchange rates, revenue in EMEA/Asia Pacific increased by 9% in the three-month period to 30 June 2008. Organic revenue growth was 1%, with acquisitions, mainly Emailing Solution (acquired in May 2007), Tallyman and Hitwise contributing the balance.
Organic revenue declined at Credit Services by 3%, exacerbated by contract phasing in business process outsourcing and continued declines in cheque volumes at the French transaction processing business. Decision Analytics performed strongly, with organic revenue growth of 14%, reflecting new business wins in Italy and Eastern Europe and a strong one-off contribution in Japan. Marketing Services again performed well, with organic growth of 8%.
Experian will hold its AGM in Dublin on 16 July 2008 and will issue its first half trading update on 15 October 2008.
|Paul Brooks||Chief Financial Officer||+44 (0)203 042 4215|
|Nadia Ridout-Jamieson||Director of Investor Relations|
|Alex Brog||Head of Media Relations|
|Rollo Head||+44 (0)207 251 3801|
This announcement is available on the Experian website, www.experiangroup.com. There will be two conference calls today to discuss this update, at 9.00am and at 3.00pm (UK time). Both will be broadcast live on the website with a recording available later.
All financial information is based on unaudited management accounts. Certain statements made in this interim management statement are forward-looking statements. Such statements are based on current expectations and are subject to a number of risks and uncertainties that could cause actual events or results to differ materially from any expected future events or results referred to in these forward-looking statements.