PR Newswire
CHICAGO, Oct. 25, 2017
CHICAGO, Oct. 25, 2017 /PRNewswire/ -- Morningstar, Inc. (NASDAQ: MORN), a leading provider of independent investment research, today announced its third-quarter 2017 financial results. The company reported net income of $33.9 million, or 79 cents per diluted share, compared with $30.2 million, or 70 cents per diluted share, in the third quarter of 2016.
Key Operating Metrics
"We're pleased with the top-line growth and continued momentum in our business, led by positive results in each of our strategic areas of focus," said Kunal Kapoor, Morningstar's chief executive officer. "Our major drivers of organic growth include Morningstar Direct, Morningstar Data, Managed Portfolios, and Workplace Solutions. PitchBook's growth is in line with our expectations, and we continue to be confident in its large untapped market opportunity. We're executing our strategy across our key investment areas to drive profitable growth over the long term. That said, we're conscious that strong performance across major asset classes globally is likely unsustainable."
Update on Key Investment Areas
As part of its long-term strategy, Morningstar has five major areas of focus for investment—Morningstar Data (including PitchBook), Morningstar Direct, Workplace Solutions, Morningstar Managed Portfolios, and Morningstar Credit Ratings. As a group, these five areas had quarterly organic revenue growth of about 13.4% year over year.
The highlights below summarize key operating metrics in these areas as of Sept. 30, 2017 compared with the same date in 2016.
Balance Sheet and Capital Allocation
Comparability of Year-Over-Year Results
Use of Non-GAAP Financial Measures
The table at the end of this press release includes a reconciliation of organic revenue, adjusted operating income, adjusted operating margin, and free cash flow to comparable GAAP measures and an explanation of why the company uses these non-GAAP financial measures.
Investor Communication
Morningstar encourages all interested parties—including securities analysts, current shareholders, potential shareholders, and others—to submit questions in writing. Investors and others may send questions about Morningstar's business to investors@morningstar.com.
The company will make written responses to selected inquiries available to all investors at the same time in Form 8-Ks furnished to the Securities and Exchange Commission, generally on the first Friday of every month.
About Morningstar, Inc.
Morningstar, Inc. is a leading provider of independent investment research in North America, Europe, Australia, and Asia. The company offers an extensive line of products and services for individual investors, financial advisors, asset managers, retirement plan providers and sponsors, and institutional investors in the private capital markets. Morningstar provides data and research insights on a wide range of investment offerings, including managed investment products, publicly listed companies, private capital markets, and real-time global market data. Morningstar also offers investment management services through its investment advisory subsidiaries, with more than $220 billion in assets under advisement and management as of Sept. 30, 2017. The company has operations in 27 countries.
Caution Concerning Forward-Looking Statements
This press release contains forward-looking statements as that term is used in the Private Securities Litigation Reform Act of 1995. These statements are based on our current expectations about future events or future financial performance. Forward-looking statements by their nature address matters that are, to different degrees, uncertain, and often contain words such as "may," "could," "expect," "intend," "plan," "seek," "anticipate," "believe," "estimate," "predict," "potential," "prospects," or "continue." These statements involve known and unknown risks and uncertainties that may cause the events we discuss not to occur or to differ significantly from what we expect.
For us, these risks and uncertainties include, among others, liability for any losses that result from an actual or claimed breach of our fiduciary duties; failing to maintain and protect our brand, independence, and reputation; failing to differentiate our products and continuously create innovative, proprietary research tools; failing to respond to technological change, keep pace with new technology developments, or adopt a successful technology strategy; trends in the asset management industry, including the increasing popularity of passively managed investment vehicles; liability related to the storage of personal information related to individuals as well as portfolio and account-level information; liability relating to the acquisition or redistribution of data or information we acquire or errors included therein; compliance failures, regulatory action, or changes in laws applicable to our investment advisory or credit rating operations; the failure of acquisitions and other investments to produce the results we anticipate; downturns in the financial sector, global financial markets, and global economy; the effect of market volatility on revenue from asset-based fees; a prolonged outage of our database, technology-based products and services, or network facilities; and challenges faced by our non-U.S. operations, including the concentration of data and development work at our offshore facilities in China and India.
A more complete description of these risks and uncertainties can be found in our filings with the Securities and Exchange Commission, including our Annual Report on Form 10-K for the year ended December 31, 2016. If any of these risks and uncertainties materialize, our actual future results may vary significantly from what we expected. We do not undertake to update our forward-looking statements as a result of new information or future events.
Non-GAAP Financial Measures
To supplement Morningstar's condensed consolidated financial statements presented in accordance with Generally Accepted Accounting Principles (GAAP), Morningstar uses the following measures considered as non-GAAP by the U.S. Securities and Exchange Commission: consolidated revenue excluding acquisitions, divestitures, and the effect of foreign currency translations (organic revenue); consolidated operating income excluding PitchBook (adjusted operating income); consolidated operating margin excluding PitchBook (adjusted operating margin); and free cash flow. These non-GAAP measures may not be comparable to similarly titled measures reported by other companies.
Morningstar presents consolidated revenue excluding acquisitions, divestitures, and the effect of foreign currency translations (organic revenue) because the company believes this non-GAAP measure helps investors better compare period-over-period results.
Morningstar presents operating income and operating margin excluding PitchBook (adjusted operating income and adjusted operating margin) to show the effect of this acquisition, better reflect period-over-period comparisons, and improve overall understanding of Morningstar's current and future financial performance.
In addition, Morningstar presents free cash flow solely as supplemental disclosure to help investors better understand how much cash is available after making capital expenditures. Morningstar's management team uses free cash flow to evaluate its business. Free cash flow should not be considered an alternative to any measure required to be reported under GAAP (such as cash provided by (used for) operating, investing, and financing activities).
For more information about these non-GAAP measures, please see the reconciliations provided in the accompanying financial tables. All dollar and percentage comparisons, which are often accompanied by words such as "increase," "decrease," "grew," "declined, " or "was similar" refer to a comparison with the same period in the previous year unless otherwise stated.
©2017 Morningstar, Inc. All Rights Reserved.
MORN-E
Contacts:
Media: Sasha Bigda, +1 312 244-7493 or sasha.bigda@morningstar.com
Investors may submit questions to investors@morningstar.com.
Morningstar, Inc. and Subsidiaries | |||||||||||||
Unaudited Condensed Consolidated Statements of Income | |||||||||||||
| | | | | | | | | | | | | |
| | | Three months ended September 30 | | Nine months ended September 30 | ||||||||
(in millions, except per share amounts) | | 2017 | | 2016 | | change | | 2017 | | 2016 | | change | |
| | | | | | | | | | | | | |
| | | | | | | | | | | | | |
Revenue | | $ 229.9 | | $ 196.1 | | 17.3% | | $ 668.6 | | $ 586.4 | | 14.0% | |
Operating expense: | | | | | | | | | | | | | |
| Cost of revenue | | 90.9 | | 84.9 | | 7.1% | | 283.2 | | 256.3 | | 10.5% |
| Sales and marketing | | 31.1 | | 23.1 | | 35.0% | | 100.2 | | 71.1 | | 41.1% |
| General and administrative | | 33.3 | | 25.8 | | 29.0% | | 93.2 | | 76.1 | | 22.5% |
| Depreciation and amortization | | 21.8 | | 18.1 | | 19.7% | | 64.8 | | 52.0 | | 24.5% |
| Total operating expense | | 177.1 | | 151.9 | | 16.6% | | 541.4 | | 455.5 | | 18.9% |
Operating income | | 52.8 | | 44.2 | | 19.7% | | 127.2 | | 130.9 | | (2.8%) | |
Operating margin | | 23.0% | | 22.5% | | 0.5pp | | 19.0% | | 22.3% | | (3.3)pp | |
| | | | | | | | | | | | | |
Non-operating income (expense): | | | | | | | | | | | | | |
| Interest income (expense), net | | (0.9) | | - | | NMF | | (2.6) | | 0.3 Werbung Mehr Nachrichten zur Morningstar Aktie kostenlos abonnieren
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