IHS Markit Ltd. (NASDAQ:INFO) Q2 2017 Earnings Conference Call Transcript

Jun 27, 2017 • 08:00 am ET

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IHS Markit Ltd. (NASDAQ:INFO) Q2 2017 Earnings Conference Call Transcript

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Presentation
Operator
Operator

Good day, ladies and gentlemen, and welcome to the Second Quarter 2018 IHS Markit Earnings Conference Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session and instructions will follow at that time. (Operator Instructions) And as a reminder, today's conference call is being recorded.

I'd now like to turn the conference over to Eric Boyer, Head of Investor Relations. Please go ahead.

Executive
Eric Boyer

Good morning and thank you for joining us for the IHS Markit Q2 2018 Earnings Conference Call. Earlier this morning, we issued our Q2 earnings press release and posted supplemental materials to the IHS Markit Investor Relations website.

Our discussion on the quarter is based on non-GAAP measures or adjusted numbers, which exclude stock-based compensation, amortization of acquired intangibles and other items. IHS Markit believes non-GAAP results are useful in order to enhance understanding of our ongoing operating performance, but they are supplement to and should not be considered in isolation from or as a substitute for GAAP financial information.

As a reminder, this conference call is being recorded and webcast and is the copyrighted property of IHS Markit. Any rebroadcast of this information, in whole or in part, without the prior written consent of IHS Markit is prohibited.

This conference call, especially the discussion of our outlook, may contain statements about expected future events that are forward-looking and subject to risks and uncertainties. Factors that could cause actual results to differ materially from expectations can be found in IHS Markit's filings with the SEC and on the IHS Markit website.

After our prepared remarks, Lance Uggla, Chairman and CEO; and Todd Hyatt, EVP and Chief Financial Officer, will be available to take your questions.

With that, it is my pleasure to turn the call over to Lance.

Executive
Lance Uggla

Thank you, Eric. Thank you for joining us for the IHS Markit Q2 earnings call. We outperformed our expectations for the quarter and were able to continue to invest in our people, products, technology and customers for long-term profitable growth.

Some key financial highlights of the quarter are, revenue of $1.008 billion, up 11% year-over-year and 8% on an organic basis, and well above the upper end of our longer term range. We experienced broad based growth across the firm and all business performed well. Adjusted EBITDA of $398 million, up 13% over the prior year and margin of 39.5%. Normalized margin expansion was 110 basis points, excluding the impact of FX and adjusted EPS of $0.61, up 17% over the prior year.

Let me now provide some highlights. I'll start with Transportation, which delivered record organic revenue growth of 14% in the quarter. Growth was driven broadly with continued strength across autos, aerospace and defense and maritime and trade businesses. Financial Services reported 7% organic growth with strength across our information and solutions businesses. Within these businesses, top performers were pricing, indices, valuation services, managed loan services, reg and compliance products, and enterprise data management offerings.

CMS organic revenue growth was