What were the main drivers of revenue growth in the second quarter of 2019?

Revenue growth was primarily driven by increases across all reportable segments. Market Intelligence saw strong performance due to annualized contract value growth in its key solutions. Ratings benefited from higher corporate bond ratings, while Indices and Platts experienced growth due to continued demand for their data and price assessment products, along with favorable contract terms and asset-linked fees for Indices.

How did the company manage its expenses and what was the impact on operating profit?

Total expenses decreased by 5% for the quarter and 2% for the six months. Operating profit increased significantly (21% for the quarter, 10% for the six months) due to revenue growth and effective cost management. While there were employee severance charges and a lease impairment in 2019, these were offset by a decrease in selling and general expenses, partly due to lower legal settlement expenses compared to the prior year.

What is the company's strategy for returning capital to shareholders?

S&P Global demonstrated its commitment to returning capital through a quarterly common stock dividend, which was increased from $0.50 to $0.57 per share. Additionally, the company actively engaged in share repurchases, utilizing $644 million in the first six months of 2019 through an accelerated share repurchase program and other open market purchases.

Are there any significant acquisitions or divestitures that impacted the financial results?

In July 2019, S&P Global completed the acquisition of the Orion technology center, which was not material to the consolidated financial statements. The company also entered into an agreement to sell RigData and completed the sale of Standard & Poor's Investment Advisory Services LLC (SPIAS) in July 2019. These divestitures are not expected to have a material impact on the consolidated financial statements. The acquisition of Kensho in April 2018 continued to influence operating expenses, particularly amortization.

SPGI 10-Q Quarterly Report Q2 FY2019 — Revenue, Net Income, EPS

Summary

S&P Global Inc. (SPGI) reported strong financial results for the quarter and six months ended June 30, 2019, demonstrating robust revenue growth and improved profitability across its diverse business segments. Total revenue increased by 6% for the quarter and 3% for the six-month period, driven by strong performance in Market Intelligence, Indices, and Platts, supported by sustained demand for their data, analytics, and benchmark services. Operating profit saw a significant increase of 21% for the quarter and 10% for the six months, reflecting effective cost management and the benefit of higher revenue, partially offset by strategic investments and restructuring charges. Key growth drivers include expanding subscription revenue in Market Intelligence and Platts, alongside increased asset-linked fees in Indices due to higher assets under management. The company's Ratings segment experienced mixed performance with strong corporate bond ratings offsetting a decline in bank loan ratings. S&P Global continues to focus on its strategic priorities, including delivering revenue growth, margin expansion, and returning capital to shareholders through dividends and share repurchases, while investing in technology and innovation to maintain its market leadership.

Financial Highlights

51 data points

Beta

Revenue

$1.70B

0.7% Gross Margin

Net Income

$555.00M

0.3% Net Margin

EPS (Diluted)

$2.24

Total Assets

$10.19B

Cash & Equivalents

$1.92B

Free Cash Flow

$717.00M

Financial Statements

Beta

Revenue	$1.70B
Cost of Revenue	$471.00M
Gross Profit	$1.23B
SG&A Expenses	$368.00M
Operating Expenses	$891.00M
Operating Income	$813.00M
Net Income	$555.00M
EPS (Basic)	$2.25
EPS (Diluted)	$2.24
Shares Outstanding (Basic)	246.10M
Shares Outstanding (Diluted)	247.40M

Key Highlights

1Total revenue increased by 6% to $1.704 billion for the three months ended June 30, 2019, and by 3% to $3.275 billion for the six months ended June 30, 2019, compared to the prior year periods.
2Operating profit surged by 21% to $813 million for the three months and 10% to $1.518 billion for the six months, indicating improved operational efficiency.
3Diluted earnings per share (EPS) rose to $2.24 for the quarter and $3.89 for the six months, up from $1.82 and $3.75, respectively, demonstrating enhanced profitability for shareholders.
4Market Intelligence and Indices segments showed particularly strong revenue growth, driven by increased subscription revenue and asset-linked fees respectively.
5The company repurchased $644 million of its shares during the first six months of 2019, signaling confidence in its financial health and commitment to returning value to shareholders.
6The company adopted new lease accounting standards, resulting in the recognition of right-of-use assets and lease liabilities on the balance sheet.

S&P Global Inc. Quarterly Report for Q2 Ended Jun 30, 2019

Summary

Financial Highlights

Key Highlights

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