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Highlights
- Revenue rose 7% across all regions, with notable strength in Consumer Services and B2B sectors.
- Benchmark EBIT grew 10%, while EPS saw an 8% increase, showcasing profitability and growth.
- Strategic acquisitions and a 7% dividend increase reflect Experian's commitment to long-term expansion.
Experian (LSE:EXPN) has reported financial results for the first half of the fiscal year ending in September 2024. Total revenue from ongoing activities rose by 7% at constant currency, reflecting steady performance across its global regions. North America and Latin America led with 7% growth, while the UK and Ireland region reported a 2% increase, and EMEA and Asia Pacific also saw 7% growth. The Consumer Services segment was a key driver, achieving organic revenue growth of 9% thanks to its membership base of over 190 million people who benefit from Experian’s financial tools and services. Additionally, the Business-to-Business (B2B) sector reported 6% organic revenue growth, fueled by demand in analytics, mortgage services, and strong performances within North American verticals.
Profitability and Earnings Showcase Strong Financial Health
Experian’s benchmark EBIT rose by 10% on a constant currency basis, reaching $1.01 billion and reflecting a solid 28% EBIT margin. Benchmark earnings per share (EPS) increased by 8% at actual exchange rates and 9% at constant rates, underscoring Experian’s ability to drive shareholder value amid steady growth. The company generated an operating cash flow of $707 million, achieving a cash conversion rate of 71%, although H1 typically reflects seasonally lower cash flow.
Strategic Investments Fuel Future Growth
Experian has invested significantly to strengthen its growth trajectory, spending $818 million on strategic acquisitions during the period. This investment is aligned with its focus on enhancing product offerings, expanding analytics capabilities, and building on its competitive edge in core Consumer and B2B services. Experian also maintained its financial flexibility, keeping its net debt-to-benchmark EBITDA ratio steady at 2.0x, which underlines the company’s strong balance sheet and disciplined approach to debt management.
Dividend Increase Amid Strong Shareholder Returns
Despite a 6% decline in statutory pre-tax profit to $718 million, primarily due to non-cash fair value adjustments on interest rate swaps, Experian maintained its commitment to shareholder returns. The company announced a 7% increase in its interim dividend, raising it to 19.25 cents per share. This dividend increase reflects Experian’s confidence in its ongoing growth strategy and its dedication to delivering consistent returns to investors.
Outlook: Focus on Core Services and Analytics Expansion
Experian remains focused on capital discipline and strategic expansion, with plans to enhance its analytics offerings and strengthen its position in core markets. The company expects to continue leveraging growth opportunities in both Consumer Services and B2B markets, with a particular emphasis on advancing analytics capabilities to meet evolving client demands.
