13 July 2009
Experian, the global information services company, today issues an interim management statement that includes an update on trading for the three months to 30 June 2009.
Commenting on the performance of Experian, Don Robert, Chief Executive Officer, said:
“I am pleased to announce another quarter of growth for our business in what remain challenging market conditions. Latin America, Interactive and new vertical markets performed strongly while, as previously indicated, there was weakness in other areas due to the tight lending environment and recessionary economic conditions in the US and UK. At constant exchange rates, total revenue growth for the quarter was 1%, with organic revenue growth also of 1%.
“Our businesses traded in line with our expectations during the quarter, and we continue to expect little organic revenue growth in the first half. We are managing the business tightly and are on track for the year to broadly maintain margins, grow profits at constant currency and deliver strong cash flow conversion. We are aggressively pursuing a number of growth initiatives, which we expect will position Experian strongly for the future.”
|Continuing activities only1||Total growth %|
At actual exchange rates2
|Total growth %|
At constant exchange rates
|Organic growth %|
At constant exchange rates
|UK and Ireland||(22)||–||–|
In the three months to 30 June 2009, revenue from continuing activities at Experian increased by 1% at constant exchange rates. Group organic revenue growth was 1% year-on-year. By principal activity, organic revenue increased by 10% at Interactive and by 2% at Credit Services. Organic revenue declined by 7% at Decision Analytics and by 8% at Marketing Services.
Total revenue from continuing activities in North America declined by 2%. Organic revenue also declined by 2%. There was a small contribution from SearchAmerica (acquired in December 2008).
Organic revenue at Credit Services declined by 6%, as market conditions remained challenging during the quarter. Credit origination continues to be tight and lender activity is focused on account management, linked to rising loan delinquencies. Mortgage refinancing activity was volatile in the period. At Decision Analytics, while sales cycles are long the pipeline is good; organic revenue declined by 1%. As expected, the environment for Marketing Services was tough, due to client marketing cutbacks and bankruptcies, particularly in the retail sector. Organic revenue declined by 14%. New media activities continued to grow, while conditions for traditional media were very challenging. Organic revenue growth at Interactive was 6%. Consumer Direct further extended its market lead, with good growth, driven by strength in customer acquisitions.
Revenue for Latin America increased by 15% at constant exchange rates. Organic revenue growth was also 15%.
Organic revenue at Credit Services rose by 17%. There were strong performances at both consumer and business information, driven by deeper market penetration, enhanced sales execution and clients trading up to higher value-added products. At Decision Analytics, organic revenue growth was 7%. At Marketing Services organic revenue declined by 42% from a small base, reflecting a strong prior-year comparative.
At constant exchange rates, total revenue growth in UK and Ireland from continuing activities was flat. Organic revenue growth was also flat.
As expected, performance at Credit Services was affected by financial services sector consolidation and organic revenue declined by 5%. At Decision Analytics, revenue declined by 6%. This reflected delays in pipeline conversion, as well as the impact of a switch of collections software to an annual licence model (consistent with other Experian software products). In underlying terms, collections grew well. At Marketing Services, there was good growth in new media, which helped mitigate continued weakness across traditional activities; organic revenue was down 4%. Interactive grew strongly, up 56%, with continued strength in new customer acquisition as market penetration increased.
At constant exchange rates, total revenue in EMEA/Asia Pacific increased by 5%. Organic revenue growth was flat, with KreditInform in South Africa (acquired in December 2008) contributing the balance.
Organic revenue growth at Credit Services was 7%, with good progress across both established and emerging markets. Organic revenue at Decision Analytics declined by 14%, reflecting deferrals in pipeline conversion in some markets and a strong prior-year comparative that included large one-off software deliveries (including in Japan). Marketing Services’ organic revenue growth was 5%, with continued strength across contact data, email marketing and competitive intelligence activities.
There has been no change since 31 March 2009 to Experian’s general financial position, which remains strong, and no material change to its trading position to the date of this statement.
Experian will hold its AGM in Dublin on 15 July 2009 and will issue its first half trading update on 14 October 2009.
|Paul Brooks||Chief Financial Officer||+44 (0)20 3042 4215|
|Nadia Ridout-Jamieson||Director of Investor Relations|
|Alex Brog||Head of Media Relations|
|Rollo Head||+44 (0)20 7251 3801|
This announcement is available on the Experian website, www.experianplc.com. There will be two conference calls today to discuss this update, at 9.00am and 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.