Experian share price: Q3 organic revenue grows 5%, total revenue up 7% after acquisitions

on Jan 16, 2014
Updated: Oct 21, 2019
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iNVEZZ.com, Thursday, January 16: Shares in Experian Plc (LON:EXPN) have been little changed in early morning trading after the global information services company reported third quarter organic revenue growth in line with the previous quarter and announced changes in its top management. Experian’s share price, which has gained some four percent this week, is up 0.1 percent to 1,151p as at 8:24 UTC, compared to a 0.02 percent decline in the Footsie.

**Q3 results**
Experian said its total revenue from continuing activities for its fiscal third quarter from October to December grew 7.0 percent year-on-year at constant exchange rates, while organic revenue growth was 5.0 percent, with the difference stemming from the two US acquisitions during the quarter. This compares to total and organic revenue growth of 5.0 percent in the second quarter and 7.0 percent in the first quarter. At actual exchange rates, third quarter total revenue growth was slower, at 5.0 percent due to the depreciation of the Brazilian real to the US dollar.

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The report showed that the conditions in Latin America have remained challenging, as organic revenue growth in the region slowed further to 5.0 percent in Q3 compared to 7.0 percent in the first half of the fiscal year. The company, which is best known for running consumer credit checks for banks and retailers, noted that economic conditions in Brazil remain tough amid weak consumer confidence and low levels of consumer lending activity.

Commenting on the performance, CEO Don Robert noted that all regions and business lines contributed to the Q3 revenue growth, highlighting the 16 percent growth in the Decision Analytics business, which was fuelled by fraud prevention products and strong sales of the company’s flagship PowerCurve software platform.
“We have also seen improving conditions in some markets such as the UK, and we’re making significant progress on the strategic investments we have made in prior years which are providing new sources of growth. As we have previously said, some of our markets have been challenged, with a weak economic environment in Brazil, and softness in US mortgage activity,” Rober said.

Looking ahead, the CEO forecast organic revenue growth for the second half to be at least similar to that in the third quarter. He maintained the company’s full-year outlook for modestly improved margins (at constant currency) and cash flow conversion of at least 90 percent.

**US acquisitions**
The Dublin-based company said its two US acquisitions have both made strong starts and good take up with clients has been observed. During the quarter, Experian completed the $850 million purchase of Passport Health Communications, a provider of data, analytics and software in the US healthcare payments market, and the $324 million acquisition of US fraud detection group The 41st Parameter.
The acquisitions were funded from Experian’s existing committed bank facilities. The company’s net debt stood at $4.1 billion at the end of 2013.
**Management changes**
In a separate statement, Experian said it has appointed Don Robert as Chairman to succeed John Peace, while Chief Financial Officer Brian Cassin will replace Robert as CEO. George Rose, currently an independent non-executive director will become Deputy Chairman & Senior Independent Director, succeeding Alan Rudge, who is retiring. The appointments will become effective after the company’s annual shareholders meeting, scheduled for July 16. The company will now seek an external candidate for the CFO position, as well as two independent non-executive directors to strengthen the board.
**As of 8:08 UTC buy Experian shares at 1,148.00p.**
**As of 8:08 UTC sell Experian shares at 1,144.00p.**
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