11th Jul 2014 07:21
LONDON (Alliance News) - Experian PLC Friday said its revenue grew 4% in its fiscal first quarter as growth in UK, North America and the rest of the world offset a slowdown in Latin America as customers there took time out to watch the football World Cup.
The information services provider, which provides services like credit checking and financial risk analysis, had previously warned that it expected a slowdown in Latin America due to the football World Cup being held in Brazil and also due to a brand strengthening plan it is conducting in its North America consumer services business.
The overall revenue growth of 3% at constant exchange rates in the three months to June 30 represented a marked slowdown from the 7% growth at constant rates the company reported for the whole of its last financial year.
"Looking ahead, while we continue to expect growth in the first half to be constrained by the one-off headwinds we expect a return to more normal levels of organic revenue growth as the second half of the year progresses. We also continue to expect at least to maintain margins for the year, to deliver growth in earnings per share and to exceed 90% cash flow conversion," Chief Executive Don Robert said in a statement.
Its earnings before interest and tax margin was 27.4% in the year to end-March, up 30 basis points on the previous year. Its benchmark EPS was 91.7 US cents, up 8% at actual rates. Basic EPS from continuing operations was 76.1 cents, up from 24.7 cents a year earlier.
In a statement, the company said revenue was up 16% on the year in the UK in the three months to end-June. The company reports in US dollars, and so got a significant boost from sterling's strength. At constant currencies, growth was 6%, of which 5% was organic.
"We delivered organic revenue growth in credit services of 4% and in decision analytics of 2%, as we continue to see gradual improvement in lending activity, client investment in lending infrastructure and good demand for analytics. Growth in Marketing Services was 2%," it said. "Consumer Services delivered good growth with organic revenue growth of 13% reflecting new member growth and increased retention rates."
Revenue growth in North America was 5%, although organic revenue fell 2% due to a 10% decline at consumer services. It is shifting its focus from 'free' direct-to-consumer brands and investing in Experian.com as its flagship brand instead. Revenue rose 20% at Experian.com, it said. Revenue also declined 3% in its marketing services business due to lower demand for data. However, its North American passport and decision analytics business performed well.
Its North American credit services unit did particularly well, with organic revenue up 6%.
Total and organic revenue growth fell 3% at constant exchange rates in the first quarter in Latin America, as the World Cup hit trading in Brazil. Its decision analytics business in the region reported a 23% decline in revenue after a very strong performance a year earlier, while the rate of decline in its marketing services business moderated to a 1% decline.
In Europe, Middle East and Africa and Asia Pacific, the company reported total revenue growth of 4% thanks to its acquisition of 41st parameter, and organic growth of 2%.
Experian shares were up 0.8% at 1,011.00 pence early Friday.
By Steve McGrath; [email protected]; @stevemcgrath1
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