8-KEarnings & ResultsRegulation FDExhibits & Filings

S&P Global Inc. 8-K Report, Financial Results (Jul 25, 2006)

Filed July 25, 2006For Securities:SPGI

Summary

S&P Global Inc. (formerly The McGraw-Hill Companies, Inc.) filed this Form 8-K on July 25, 2006, to disclose its second-quarter 2006 financial results and provide an updated full-year outlook. The company reported a significant increase in diluted earnings per share (EPS) for the quarter, driven by strong performance in its Financial Services segment. This segment saw a substantial revenue increase, bolstered by growth in structured finance and corporate/government ratings, with specific exclusions for divested businesses and recent acquisitions. Crucially, the company raised its full-year 2006 EPS guidance, signaling confidence in its ongoing performance and future growth opportunities. The updated guidance reflects an $0.08 improvement, projecting EPS between $2.44 and $2.49, excluding the impact of stock-based compensation. Management anticipates returning to double-digit earnings growth in 2007, indicating a positive outlook for the company's strategic direction and business segments.

Key Highlights

  • 1Reported a 17.6% increase in diluted EPS to $0.60 for Q2 2006 compared to Q2 2005.
  • 2Financial Services segment revenue grew 13.4% to $677.3 million in Q2 2006.
  • 3Non-GAAP revenue growth in Financial Services was primarily driven by structured finance (38.6%) and corporate/government ratings (34.8%).
  • 4Raised full-year 2006 EPS guidance by $0.08, now projecting $2.44 to $2.49 (excluding stock-based compensation).
  • 5Expects to return to double-digit earnings growth in 2007.
  • 6The filing includes non-GAAP financial measures to provide a clearer view of continuing business performance.

Frequently Asked Questions

The increase in diluted EPS for Q2 2006 was primarily driven by strong revenue growth in the Financial Services segment, which benefited from increased activity in structured finance and corporate/government ratings.

The company raised its full-year 2006 EPS guidance due to the 'strength of our first half performance,' indicating better-than-expected results and positive business momentum.

The company is presenting certain financial results on a non-GAAP basis to exclude the impact of items like divested businesses (Corporate Value Consulting), recent acquisitions (CRISIL, Ltd.), and stock-based compensation. They believe these non-GAAP measures offer a more meaningful way for investors to understand the performance of their ongoing businesses and facilitate period-to-period comparisons.

The company anticipates returning to double-digit earnings growth in 2007, citing 'more robust opportunities taking shape next year.'