Investor Seminar

28 January 2015 - Experian, the global information services company, will host a seminar for analysts and institutional investors today in London.

During our half-yearly results in November, we discussed our objective to deliver attractive rates of earnings growth and superior returns through five key strategic priorities:

• Focus on our key strengths

• Deliver performance improvements

• Seize attractive growth opportunities

• Drive organisational efficiency and productivity

• Rigorously optimise capital

In today’s seminar we will elaborate on these strategic themes, with presentations from the Experian management team. We will discuss growth opportunities across Credit Services, our fraud prevention and identity verification operations and in software and analytics, as well as across our healthcare operations in North America. We will discuss the plans we have in place to drive performance improvements in North America Consumer Services, in Marketing Services and in Brazil, and we will also elaborate on the outcome of a review of the Group’s capital allocation framework.

The agenda for today’s sessions is included in the appendix below.

Result of capital framework review

As discussed in November 2014, we have reviewed our capital allocation framework as part of our strategic priority to rigorously optimise capital. The conclusions and outcomes of this review are detailed below. This comprehensive review encompassed our risk and capital returns framework, our balance sheet structure, and the scope and mechanism for future shareholder returns.

Our key conclusions are that:

• The Group has strong cash generation potential which provides substantial cashflow for investment, both organic and inorganic, to meet the Group’s strategic goals. 

• The capital allocation process can provide greater emphasis on the assessment of risk in the investment appraisal process. 

• As at 31 December 2014, the Group had a net debt/EBITDA ratio below 2x, reduced in line with our commitments at the time of the Passport acquisition. There is now scope to enhance the efficiency of the capital structure, whilst sustaining strong investment grade credit ratings and sufficient flexibility for future investment. 

• The Group’s strong cash profile provides the potential to progress the ordinary dividend payout. 

• The rate of future cash generation is expected to continue to provide residual capital for additional returns to shareholders. 

As a consequence of the review, we intend to adopt the following approach:

• Our priority will be to allocate capital in support of our growth ambitions, while driving business efficiency and generating good investment returns. We will prioritise growth investment in core activities, both organically and inorganically. Acquisitions will continue to form part of the investment mix, assessed by a range of stringent criteria. We will also continually evaluate peripheral activities and, where appropriate, rationalise accordingly. 

• To achieve this, we are implementing changes in the way we assess risk and the way we allocate capital internally, with a more prominent focus on return on capital employed and internal capital rationing. We will require organic and inorganic investment returns to be significantly in excess of the Group’s weighted average cost of capital and we will test all acquisitions against the use of capital for share repurchases. 

• We will continue our progressive dividend policy, and expect to grow ordinary dividends in line with, or ahead of, the growth in Benchmark earnings. 

• We will adopt a new target leverage range of 2-2.5x net debt/EBITDA, consistent with striking a balance between operating an efficient balance sheet, where our weighted average cost of capital is optimised, and maintaining good access to the debt capital markets. We intend to move into this new range as we progress through the year ending 31 March 2016. 

• We will periodically return surplus capital to shareholders (keeping this policy under review), commencing with a US$600m share repurchase programme, to be completed over the next 14 months, subject to trading conditions.

With this strategic and capital framework our aspiration will be to deliver annual average growth in organic revenue in the mid-single digit range. With the application of our cash flows into organic investment opportunities, acquisitions and returns of excess capital to shareholders, we have the potential for strong growth in earnings per share.

With this framework the management team and Board of Experian believe we will create significant shareholder value.

No new information on current trading will be disclosed in the investor presentation. Guidance for FY15, as communicated at the Q3 trading update on 15 January 2015, remains unchanged. 

The investor seminar will be webcast live on our website at www.experianplc.com.  A recording and transcript of the event will be available later on our website at www.experianplc.com.

Appendix

Agenda for Experian investor seminar, 28 January 2015.

Contact:

Experian

Nadia Ridout-Jamieson          Director of Investor Relations       +44 (0)20 3042 4215

James Russell                        Director of Corporate Communications

Finsbury

Rollo Head                                                                                    +44 (0)20 7251 3801

Jenny Davey

About Experian

We are the leading global information services company, providing data and analytical tools to our clients around the world. We help businesses to manage credit risk, prevent fraud, target marketing offers and automate decision making. We also help people to check their credit report and credit score, and protect against identity theft.  In 2014, we were named by Forbes magazine as one of the ‘World’s Most Innovative Companies’.

We employ approximately 16,000 people in 39 countries and our corporate headquarters are in Dublin, Ireland, with operational headquarters in Nottingham, UK; California, US; and São Paulo, Brazil.

Experian plc is listed on the London Stock Exchange (EXPN) and is a constituent of the FTSE 100 index. Total revenue for the year ended March 31, 2014, was US$4.8 billion.

To find out more about our company, please visit http://www.experianplc.com or watch our documentary, ‘Inside Experian’.