Summary
Moody's Corporation reported a modest revenue increase of 10.9% to $2.26 billion for the fiscal year ended December 31, 2007. While overall revenue grew, the company experienced a significant slowdown in its structured finance business in the latter half of the year due to credit market turmoil, particularly impacting U.S. markets. This led to a $50 million restructuring charge. Net income decreased by 7.0% to $701.5 million, and earnings per diluted share were $2.58. The company actively managed its capital by repurchasing shares and paying dividends, while also undertaking a significant corporate reorganization to separate its ratings business (Moody's Investors Service) from its other commercial activities (Moody's Analytics). Looking ahead, Moody's projected a decline in revenue for 2008, citing continued weakness in certain market sectors, especially structured finance. Despite these headwinds, the company continued to invest in its Moody's Analytics segment, anticipating growth in its data and risk management solutions. Regulatory reviews of credit rating agencies were ongoing, with potential impacts on the business model and costs.
Financial Highlights
28 data points| Revenue | $2.26B |
| SG&A Expenses | $451.10M |
| Operating Expenses | $1.13B |
| Operating Income | $1.13B |
| Net Income | $701.50M |
| EPS (Basic) | $2.63 |
| EPS (Diluted) | $2.58 |
| Shares Outstanding (Basic) | 266.40M |
| Shares Outstanding (Diluted) | 272.20M |
Key Highlights
- 1Revenue increased by 10.9% to $2.26 billion in 2007, driven by corporate finance and research segments.
- 2Net income decreased by 7.0% to $701.5 million, with diluted EPS at $2.58.
- 3A $50 million restructuring charge was recorded due to business reorganization and market conditions.
- 4Structured finance revenue experienced a significant decline in the second half of 2007 due to credit market turmoil.
- 5Moody's Corporation underwent a reorganization, creating two distinct segments: Moody's Investors Service and Moody's Analytics.
- 6The company repurchased approximately 31.3 million shares for $1.74 billion during 2007.
- 7Moody's outlook for 2008 projected a revenue decline in the low double-digit percent range.
- 8The company was subject to ongoing regulatory reviews concerning credit rating agencies.