01—Abstract
Summary
Summary of the 10-Q filed October 30, 2024. Cited figures are marked; the original filing is the authoritative source.
Verisk Analytics, Inc. reported third-quarter 2024 revenues of $725.3 milliona, up 7.0% from $677.6 million a year earlier, with operating income of $311.5 million versus $281.1 million.
Net income attributable to Verisk was $220.1 millionb, or $1.54 diluted EPS, compared with $187.4 million, or $1.29, in the prior-year quarter. EBITDA rose to $393.8 million from $346.8 million, and the consolidated EBITDA margin was 54.3% versus 51.2%. For the nine months, revenues were $2,146.1 million (up 7.1%) and net income attributable to Verisk was $747.8 million, helped by a $102.4 million investment gain, including a $98.3 million net gain on settling retained interests in non-public companies.
Cash generation remained strong, with operating cash flow of $888.6 millionc for the nine months, up 9.9%. The company repurchased $750.0 million of common stock (including $60.0 million not yet settled) and paid $166.6 million in dividends. Total debt rose to $3,063.0 million at September 30, 2024, following a $600.0 million issuance of 5.25% senior notes due 2034 and a $400.0 million cash tender for 2025 notes.
The quarterly dividend was increased to $0.39d per share, and the Board approved a further dividend payable December 31, 2024. Litigation remains a key watch item.
The filing discloses a telematics class action multidistrict litigation, a Nepalese tax indemnification claim, a commercial earn-out suit, and several privacy suits, and states that it is not possible to reasonably estimate liability for these matters. Stockholders' equity was $304.7 million, reflecting cumulative share repurchases and dividends.
02—Key points
Key Highlights
- Q3 2024 revenues of $725.3 million, up 7.0% from $677.6 million; underwriting revenue rose 6.7% and claims revenue rose 7.9%.
- Q3 2024 operating income of $311.5 million, up from $281.1 million; EBITDA of $393.8 million, up from $346.8 million, with EBITDA margin of 54.3% versus 51.2%.
- Nine-month net income attributable to Verisk of $747.8 million, versus $440.6 million, including a $102.4 million investment gain and a $3.6 million gain on early debt extinguishment.
- Diluted EPS from continuing operations of $1.54 for Q3 2024, up from $1.29, and $5.22 for the nine months, up from $3.96.
- Operating cash flow of $888.6 million for the nine months, up 9.9% from $808.3 million.
- Share repurchases of $750.0 million for the nine months, including $400.0 million in an August 2024 accelerated share repurchase; $891.5 million remained available under the authorization.
- Total debt of $3,063.0 million, after issuing $600.0 million of 5.25% senior notes due 2034 and tendering $400.0 million of 4.00% notes due 2025; quarterly dividend raised to $0.39 per share.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in Q3 FY2024, Verisk Analytics kept $0.30.
- Revenue$725.3M100.0%
- Cost of revenue−$223.4M30.8%
- Gross profit$501.9M69.2%
- Operating costs−$190.4M26.3%
- Operating income$311.5M42.9%
- Interest, other & tax−$91.4M12.6%
- Net income$220.1M30.3%
04—Financials
Financial Highlights
Figures from 10-QQ3 FY2024filed October 30, 2024Financial Statements
Q3 FY2024 against Q3 FY2023
| Line item | Q3 FY2024Q3 FY2023 | Change |
|---|---|---|
| Revenue | $725.30M$677.60M | +7.0% |
| Cost of Revenue | $223.40M$217.20M | +2.9% |
| Gross Profit | $501.90M$460.40M | +9.0% |
| SG&A Expenses | $114.00M$111.60M | +2.2% |
| Operating Expenses | $413.80M$396.50M | +4.4% |
| Operating Income | $311.50M$281.10M | +10.8% |
| Interest Expense | $32.10M$29.40M | +9.2% |
| Net Income | $220.10M$187.40M | +17.4% |
| EPS (Basic) | $1.55$1.29 | +20.2% |
| EPS (Diluted) | $1.54$1.29 | +19.4% |
| Shares Outstanding (Basic) | 141.78M145.01M | −2.2% |
| Shares Outstanding (Diluted) | 142.51M145.74M | −2.2% |
05—Questions
Frequently Asked Questions
How did Verisk perform in the third quarter of 2024?
Revenues increased 7.0% to $725.3 million, operating income rose 10.8% to $311.5 million, and net income attributable to Verisk increased 17.4% to $220.1 million. Diluted EPS was $1.54, compared with $1.29 a year earlier. EBITDA reached $393.8 million, with a margin of 54.3%.
Why did nine-month net income increase so sharply?
Net income attributable to Verisk was $747.8 million, compared with $440.6 million, largely because of the prior-year loss from discontinued operations of $145.5 million related to the Energy business. The current period also benefited from a $102.4 million investment gain, which included a $98.3 million net gain from settling retained interests in non-public companies.
How is Verisk using its cash and changing its capital structure?
For the nine months, the company repurchased $750.0 million of common stock and paid $166.6 million in dividends. It issued $600.0 million of 5.25% senior notes due 2034 and used the proceeds to tender for $400.0 million of its 4.00% notes due 2025. Total debt was $3,063.0 million at September 30, 2024, and the company was in compliance with its covenants.
What legal risks does the filing disclose?
The filing discloses a multidistrict telematics class action involving consumer driving data, a Nepalese tax-related indemnification claim, a commercial lawsuit over earn-out targets from the Data Driven Safety acquisition, and several privacy suits, including Daniel's Law and California privacy-law cases. For each matter, the company states it is not possible to reasonably estimate the potential liability because the cases are at early stages.
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