- Raising FY 2014 non-GAAP EPS guidance
range to $3.95 to $4.05
Moody's Corporation (NYSE:MCO) today announced new full-year
2014 guidance. Full-year 2014 non-GAAP EPS guidance is now in the
range of $3.95 to $4.05, which excludes a $0.36 gain resulting from
Moody’s acquisition of a controlling interest in ICRA Ltd. in the
second quarter of 2014. Moody’s non-GAAP EPS guidance includes
costs related to our acquisitions of WebEquity and a majority stake
in ICRA. Non-GAAP EPS guidance now also includes costs related to
our acquisition of the remaining outstanding shares of Copal Amba,
which Moody’s expects to finalize in the fourth quarter of 2014.
Full-year 2014 total share repurchases are now expected to be up to
$1.25 billion, subject to available cash, market conditions and
other ongoing capital allocation decisions.
Certain components of Moody’s 2014 revenue guidance have been
modified to reflect the Company’s current view of business
conditions. While global Moody’s Investors Service (“MIS”) revenue
for full-year 2014 is still expected to increase in the
high-single-digit percent range, U.S. and non-U.S. MIS revenues are
now expected to increase in the high-single-digit percent range and
low-double-digit percent range, respectively. MIS financial
institutions ratings revenue is now expected to grow in the
mid-single-digit percent range.
A full summary of Moody’s guidance as of September 30, 2014 is
included in the table at the end of this press release. Moody's
outlook for 2014 is based on assumptions about many macroeconomic
and capital market factors, including interest rates, corporate
profitability and business investment spending, merger and
acquisition activity, consumer borrowing and securitization, and
the amount of debt issued. There is an important degree of
uncertainty surrounding these assumptions, and, if actual
conditions differ, Moody's results for the year may differ
materially from the current outlook. Our guidance assumes foreign
currency translation at end-of-quarter exchange rates.
Moody's is holding its 2014 Investor Day conference today in New
York City.
The event will start at 8:00 a.m. Eastern Time and is expected
to conclude at 1:00 p.m. The event will feature presentations from
Moody's management team and showcase important aspects of the
business. A copy of the presentations will be posted on Moody's
Investor Relations website, http://ir.moodys.com, at the start of
the event.
In-person attendance is by invitation only; however, the event
will be webcast live and can be accessed on Moody’s Investor
Relations website at http://ir.moodys.com. The event will also be
accessible through a live conference call. Individuals within the
U.S. and Canada can access the call by dialing 1-855-309-1713
toll-free. Other callers should dial 804-419-7747. Please dial into
the call by 7:50 a.m. Eastern Time. The participant access code for
the call is 92606323.
An on-demand replay of the event will be available on Moody’s
Investor Relations website, http://ir.moodys.com, until 11:59 p.m.
Eastern Time, December 24, 2014.
ABOUT MOODY'S CORPORATION
Moody's is an essential component of the global capital markets,
providing credit ratings, research, tools and analysis that
contribute to transparent and integrated financial markets. Moody’s
Corporation (NYSE: MCO) is the parent company of Moody's Investors
Service, which provides credit ratings and research covering debt
instruments and securities, and Moody's Analytics, which offers
leading-edge software, advisory services and research for credit
and economic analysis and financial risk management. The
Corporation, which reported revenue of $3.0 billion in 2013,
employs approximately 9,500 people worldwide and maintains a
presence in 33 countries. Further information is available at
www.moodys.com.
“Safe Harbor” Statement under the Private Securities Litigation
Reform Act of 1995
Certain statements contained in this release are forward-looking
statements and are based on future expectations, plans and
prospects for Moody’s business and operations that involve a number
of risks and uncertainties. Moody’s outlook for 2014 and other
forward-looking statements in this release are made as of September
30, 2014, and the Company disclaims any duty to supplement, update
or revise such statements on a going-forward basis, whether as a
result of subsequent developments, changed expectations or
otherwise. In connection with the “safe harbor” provisions of the
Private Securities Litigation Reform Act of 1995, the Company is
identifying certain factors that could cause actual results to
differ, perhaps materially, from those indicated by these
forward-looking statements. Those factors, risks and uncertainties
include, but are not limited to, the current world-wide credit
market disruptions and economic slowdown, which is affecting and
could continue to affect the volume of debt and other securities
issued in domestic and/or global capital markets; other matters
that could affect the volume of debt and other securities issued in
domestic and/or global capital markets, including credit quality
concerns, changes in interest rates and other volatility in the
financial markets; the level of merger and acquisition activity in
the US and abroad; the uncertain effectiveness and possible
collateral consequences of U.S. and foreign government initiatives
to respond to the current world-wide credit disruptions and
economic slowdown; concerns in the marketplace affecting our
credibility or otherwise affecting market perceptions of the
integrity or utility of independent agency ratings; the
introduction of competing products or technologies by other
companies; pricing pressure from competitors and/or customers; the
level of success of new product development and global expansion;
the impact of regulation as an NRSRO, the potential for new U.S.,
state and local legislation and regulations, including provisions
in the Dodd-Frank Wall Street Reform and Consumer Protection Act
and anticipated regulations resulting from that Act; the potential
for increased competition and regulation in the EU and other
foreign jurisdictions; exposure to litigation related to our rating
opinions, as well as any other litigation to which the Company may
be subject from time to time; provisions in the Dodd-Frank Act
legislation modifying the pleading standards, and EU regulations
modifying the liability standards, applicable to credit rating
agencies in a manner adverse to credit rating agencies; provisions
of EU regulations imposing additional procedural and substantive
requirements on the pricing of services; the possible loss of key
employees; failures or malfunctions of our operations and
infrastructure; any vulnerabilities to cyber threats or other
cybersecurity concerns; the outcome of any review by controlling
tax authorities of the Company’s global tax planning initiatives;
the outcome of those legacy tax matters and legal contingencies
that relate to the Company, its predecessors and their affiliated
companies for which Moody’s has assumed portions of the financial
responsibility; the impact of mergers, acquisitions or other
business combinations and the ability of the Company to
successfully integrate acquired businesses; currency and foreign
exchange volatility; the levels of capital investments; a decline
in the demand for credit risk management tools by financial
institutions; and other risk factors as discussed in the Company’s
annual report on Form 10-K for the year ended December 31, 2013 and
in other filings made by the Company from time to time with the
Securities and Exchange Commission.
Non-GAAP diluted earnings per share attributable to Moody's
common shareholders:
The Company presents this non-GAAP measure to exclude the impact
of the ICRA Gain in the second quarter of 2014 to allow for a more
meaningful comparison of Moody’s diluted earnings per share from
period to period. Below is a reconciliation of this measure to its
most directly comparable U.S. GAAP amount:
Projected full-year
endedDecember 31,2014
Diluted EPS guidance - GAAP
$ 4.31 - 4.41 ICRA Gain (0.36)
Diluted EPS guidance -
Non-GAAP $ 3.95 - 4.05
2014 Outlook
Moody’s outlook for 2014 is based on assumptions about many
macroeconomic and capital market factors, including interest rates,
corporate profitability and business investment spending, merger
and acquisition activity, consumer borrowing and securitization,
and the amount of debt issued. There is an important degree of
uncertainty surrounding these assumptions, and, if actual
conditions differ, Moody’s results for the year may differ
materially from the current outlook. The Company’s guidance, which
is presented in the table below, assumes foreign currency
translation at end-of-quarter exchange rates.
Full-year 2014 Moody’s Corporation guidance MOODY'S
CORPORATION Current guidance as of September 30,
2014 Last publicly disclosed guidance as of July 31,
2014 Revenue growth in the low-double-digit percent
range NC Operating expenses growth in the high-single-digit
percent range NC Growth in compliance and regulatory expense Less
than $5 million NC Depreciation & amortization Approximately
$100 million NC Operating margin 42% to 43% NC Adjusted operating
margin 45% to 46% NC Effective tax rate Approximately 33% NC
Non-GAAP EPS $3.95 to $4.05 $3.90 to $4.00 Capital expenditures
Approximately $90 million NC Free cash flow Approximately $900
million NC Share repurchases
Up to $1.25 billion (subject to available
cash, market conditionsand other ongoing capital allocation
decisions)
Approximately $1 billion (subject to
available cash, marketconditions and other ongoing capital
allocation decisions)
Full-year 2014
revenue guidance MOODY'S INVESTORS SERVICE
Current guidance as of September 30, 2014 Last
publicly disclosed guidance as of July 31, 2014 MIS global
growth in the high-single-digit percent range NC MIS U.S. growth in
the high-single-digit percent range growth in the mid-single-digit
percent range MIS Non-U.S. growth in the low-double-digit percent
range growth in the low-teens percent range Corporate finance
growth in the low-double-digit percent range NC Structured finance
growth of approximately 10% NC Financial institutions growth in the
mid-single-digit percent range growth in the low-single-digit
percent range Public, project and infrastructure finance growth in
the high-single-digit percent range NC ICRA Ltd.* Approximately $12
million NC
MOODY'S ANALYTICS MA
global growth in the mid-teens percent range NC MA U.S. growth in
the low-double-digit percent range NC MA Non-U.S. growth in the
high-teens percent range NC Research, data, and analytics growth in
the high-single-digit percent range NC Enterprise risk solutions
growth in the mid-teens percent range NC Professional services
growth of approximately 40% NC
NC- There is no
difference between the Company's current guidance and the last
publicly disclosed guidance for this item.
* Due to the three month lag in
consolidating ICRA's operating results, there is only one quarter
of ICRA revenue included in the above table.
Michael Adler, 212-553-4667Senior Vice PresidentCorporate
Communicationsmichael.adler@moodys.comorSalli Schwartz,
212-553-4862Global Head of Investor
Relationssallilyn.schwartz@moodys.com
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