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Verisk Analytics 8-K Report, Financial Results (Jul 31, 2024)

Reports
Earnings & Results·Exhibits & Filings
Filing Date
Filed July 31, 2024
Period End
July 31, 2024
Security
VRSK
In the record · 2016–202610-K1110-Q328-K115

VRSK filed 11 annual reports (10-K), 32 quarterly reports (10-Q) and 115 current reports (8-K) between 2016 and 2026.

  1. Material agreement8-K · Mar ’19Mar ’19
  2. Leadership change8-K · Apr ’21Apr ’21
  3. Deal closed8-K · May ’23May ’23
  4. Leadership change8-K · Sep ’26Sep ’26

01—Abstract

Summary

Summary of the 8-K filed July 31, 2024. Cited figures are marked; the original filing is the authoritative source.

Verisk Analytics, Inc. filed this Form 8-K on July 31, 2024 under Item 2.02 (Results of Operations and Financial Condition) to furnish its press release reporting results for the quarter ended June 30, 2024 as Exhibit 99.1.

Consolidated revenues were $717 milliona, up 6.2% (6.0% on an organic constant currency basis), with growth from both underwriting and claims within Insurance. Income from continuing operations was $308 million, up 50.7%, but this was primarily driven by net gains of $98.3 million from the settlement of retained interests tied to prior business sales and a $3.6 million gain on early debt extinguishment. Adjusted EBITDA was $397 million, up 8.8% (8.5% on an OCC basis), and free cash flow was $154 million, up 14.3%.

Diluted GAAP EPS from continuing operations was $2.15b, up 52.5%, while diluted adjusted EPS was $1.74, up 15.2%, which the company attributed to revenue and profit growth, a lower effective tax rate and a lower average share count from its accelerated share repurchase program. The company repurchased $150 million of common shares in the second quarter, and the Board approved a 39-cent quarterly dividend payable September 30, 2024, an increase of 15% from 2023. As of June 30, 2024, $1.3 billion remained under the repurchase authorization.

Management left 2024 guidance unchanged, with revenue of $2,840 million to $2,900 millionc, adjusted EBITDA of $1,540 million to $1,600 million, and diluted adjusted EPS of $6.30 to $6.60. Investors should weigh the GAAP earnings growth against the one-time gains that drove it, and focus on the underlying 6% organic revenue growth and adjusted metrics.

02—Key points

Key Highlights

  1. Consolidated revenues of $717 million, up 6.2% (6.0% OCC), with Underwriting revenue of $508 million and Claims revenue of $209 million.
  2. Income from continuing operations rose 50.7% to $308 million, helped by $98.3 million in net gains on settlement of retained interests from prior business sales and a $3.6 million gain on early debt extinguishment.
  3. Adjusted EBITDA of $397 million, up 8.8% (8.5% OCC), with an adjusted EBITDA margin of 55.4% versus 54.1% a year earlier.
  4. Diluted GAAP EPS from continuing operations of $2.15, up 52.5%; diluted adjusted EPS of $1.74, up 15.2%.
  5. Free cash flow of $154 million, up 14.3%, and net cash from operating activities of $212 million, up 9.7%.
  6. Repurchased $150 million of common shares via an accelerated share repurchase program completed in July 2024; $1.3 billion remained under authorization as of June 30, 2024.
  7. 2024 guidance unchanged: revenue of $2,840-$2,900 million, adjusted EBITDA of $1,540-$1,600 million, and diluted adjusted EPS of $6.30-$6.60.

03—Questions

Frequently Asked Questions

  1. Did Verisk's second-quarter earnings growth come from core operations?

    Only partly. Income from continuing operations rose 50.7%, but the filing states this was primarily driven by $98.3 million in net gains on settlement of retained interests tied to prior sales of the healthcare business (2016) and specialized markets business (2022), plus a $3.6 million gain on early debt extinguishment. Core metrics grew more modestly, with revenue up 6.2% and adjusted EBITDA up 8.8%.

  2. What drove revenue growth in the quarter?

    The filing attributes Underwriting revenue growth (6.2% reported, 6.0% OCC) primarily to forms, rules and loss cost services and extreme event solutions, with specialty business and life solutions also contributing. Claims revenue grew 6.3% reported (5.8% OCC), primarily from anti-fraud solutions and property estimating solutions.

  3. Why did diluted adjusted EPS grow faster than adjusted EBITDA?

    The company said diluted adjusted EPS rose 15.2% to $1.74 because of revenue and profit growth, a lower effective tax rate, and a lower average share count from its accelerated share repurchase program. Adjusted EBITDA grew 8.8% over the same period.

  4. Is Verisk's 2024 guidance changing?

    No. The company stated its 2024 financial outlook remains unchanged, with revenue of $2,840-$2,900 million, adjusted EBITDA of $1,540-$1,600 million, adjusted EBITDA margin of 54.0%-55.0%, and diluted adjusted EPS of $6.30-$6.60.

  5. What capital return actions did Verisk announce?

    Verisk paid a 39-cent per share dividend on June 28, 2024, and its Board approved another 39-cent dividend payable September 30, 2024 to holders of record as of September 15, 2024, an increase of 15% from 2023. It repurchased $150 million of common shares in the second quarter through an accelerated share repurchase program completed in July 2024, and had $1.3 billion remaining under its authorization as of June 30, 2024.

04—Continue

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