Experian posts a smaller than expected decline in revenue in the fiscal first quarter

Experian posts a smaller than expected decline in revenue in the fiscal first quarter
Written by:
Wajeeh Khan
16th July, 10:44
Updated: 16th July, 10:46
  • Experian posts a smaller than expected decline in revenue in the fiscal first quarter.
  • In Norther America, its revenue climbed by 4% on resilience in mortgage volumes.
  • The Dublin-based company estimates an up to 5% decline in revenue in Q2.

Experian plc (LON: EXPN) said on Thursday that its organic revenue came in lower in the first quarter. The decline, however, was reported narrower than expected as its North American business showed robust performance in the recent quarter that contributed to offsetting the hit from COVID-19. Experian won an ongoing credit reporting dispute last month in Eleventh Circuit.

Shares of the company tanked more than 1% on Thursday but recovered the majority of its loss later in the day. At £28.41 per share, Experian is roughly 12% up year to date in the stock market after recovering from a low of £18.82 per share in March. Learn more about the financial analysis of a company.

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Experian estimates an up to 5% decline in revenue in Q2

Experian is the world’s largest credit check company that operates 11 business and 23 consumer information bureaux globally. The company reported a 2% decline in its revenue in the quarter that ended on 30th June. Experian had previously forecast a much broader 5% to 10% decline in its revenue in the first quarter.

The Dublin-based company also estimated its revenue to lie in the range of flat to a 5% decline in the second quarter on Thursday.

In North America, however, Experian saw its revenue climb by 4% in the recent quarter on the back of resilience in mortgage volumes. The company generates roughly 66% of its quarterly revenue from this region.

Experian’s revenue declines by 15% in the UK and Ireland

In the United Kingdom and Ireland combined (Experian’s 2nd largest market), revenue came in 15% lower in the first quarter attributed to a decline in lending and credit volumes at large. Organic revenue in the Asia Pacific and EMEA region posted a 20% decline in organic revenue in Q1. According to Experian:

“We also experienced delays in client purchasing decisions for software, a near total shutdown in the automotive market, and marketing data revenue was also impacted as advertisers cut back on marketing spend.”

Property transactions in the UK were also weighed significantly in recent months due to the Coronavirus pandemic that has so far infected a little under 300,000 people in the country and caused more than 45,000 deaths.

Experian performed fairly upbeat in the stock market last year with an annual gain of roughly 35%. At the time of writing, it is valued at £26.04 billion and has a price to earnings ratio of 47.92.

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