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  • Organic revenue growth of 1%

  • Increased demand for account management and collections helps offset depressed lending market

  • Recessionary conditions impact traditional marketing spend, but new media businesses deliver good growth

  • Strong performance at Consumer Direct with revenue up over 20%

  • EBIT margin improvement reflects progress on cost efficiency initiatives

2009 Revenue by activity: Credit services, Decision analytics, Marketing services, Interactive. Excludes discontinuing activities

EBIT US$m and margin. EBIT excludes discontining activites. EBIT margin is for continuing direct business only and excludes FARES

Total revenue growth: Organic growth, Acquired growth. Total growth is defined as year-on-year revenue growth at constant exchange rats. 2006, 2007 and 2008 excludes MetaReward

Organic revenue growth. Organic growth is defined as year-on-year revenue growth at constant exchange rates, excluding acquisitions except affiliates, until the date of their anniversary. 2006, 2007 and 2008 excludes Meta Reward

North America


Experian North America delivered modest organic revenue growth during a time of exceptionally challenging market conditions. There was good progress on margins, up 40 basis points, reflecting excellent delivery on cost efficiency initiatives.

1

Growth at constant exchange rates

2

2008 restated for the reclassification of certain businesses between segments, see note 2 to the Group financial statements

3

EBIT margin is for continuing business only, excluding FARES

 

 

 

 

 

 

 

 

Year ended 31 March

2009
US$m

2008
US$m

Total
growth1
%

Organic
growth1
%

 

 

 

 

 

 

 

 

 

Revenue

 

 

 

 

 

 

– Credit Services2

740

771

(4)

(5)

 

 

– Decision Analytics2

119

118

1

1

 

 

– Marketing Services2

358

360

(1)

(2)

 

 

– Interactive2

866

812

7

7

 

 

Total North America

2,083

2,061

1

1

 

 

 

 

 

 

 

 

 

EBIT

 

 

 

 

 

 

– Direct business

568

554

3

 

 

 

– FARES

48

54

(11)

 

 

 

Total North America

616

608

1

 

 

 

 

 

 

 

 

 

 

EBIT margin3

27.3%

26.9%

 

 

 

 

 

 

 

 

 

 


Credit Services

Total revenue at Credit Services declined by 4%, with organic revenue down 5%. Prospecting activity by financial services clients remained weak throughout the year, due to the depressed market environment for lending. Mortgage origination revenue also declined, although there were occasional surges in volumes linked to consumer refinancing activity.

These factors were partially offset by growth in account management and collections, with good traction from new counter-cyclical products such as bankruptcy scores and business delinquency notification services. In addition, there was a resilient performance from the automotive vertical, which benefited from market-share gains in the sale of vehicle history reports.

During the year, Experian continued to focus on strengthening its market position and on expanding into new growth verticals. In addition, through the acquisition of SearchAmerica in December 2008, Experian is extending its core data and analytics to the fast-growth healthcare payments sector.

As previously announced, Experian has discontinued efforts to launch a credit bureau in Canada. This reflects the reduced attractiveness of the opportunity following the global financial crisis, which has caused lender needs in Canada to change.

Decision Analytics

Revenue growth at Decision Analytics was 1%. There was good progress during the year across custom analytics, as well as account management, commercial lending and fraud prevention software. This helped to offset weaker demand for loan origination products. Experian further penetrated the market during the year, with a number of new business wins. In addition, Experian is developing its presence in new verticals, such as capital markets, by building relationships with lenders, ratings agencies and regulators.

Marketing Services

Total revenue at Marketing Services declined by 1%, while organic revenue declined by 2%. Recessionary conditions and cutbacks in discretionary retail spend impacted the traditional activities of list processing, data and database, which declined during the year. New media businesses delivered good growth reflecting deeper market penetration through new business wins and good retention rates.

Interactive

Revenue growth at Interactive was 7%. Consumer Direct delivered a very strong performance, with growth in excess of 20%, further extending Experian’s market lead. Growth was driven by higher memberships, growth in the affinity channel, plus contribution from one-off data breach contracts. During the year, Experian has invested in enhancing the value of the customer experience as well as in new product introductions, such as

In lead generation, Experian Interactive Media continued to experience very weak market conditions as lenders exited the market for subprime mortgage leads. Comparison shopping revenues were impacted by the weak retail environment and by adverse business mix as shoppers switched to lower value items.

Financial review

Revenue from continuing activities was US$2,083m, up 1%, with organic revenue growth of 1%.

EBIT from direct businesses was US$568m (2008: US$554m), an increase of 3% in the year, giving an EBIT margin of 27.3% (2008: 26.9%). The margin improvement reflected progress on cost efficiency initiatives, including offshoring of administrative and development roles to Chile and Costa Rica and technology efficiencies.

EBIT from FARES, the 20%-owned real estate information associate, was US$48m (2008: US$54m). The reduction reflected the very weak environment for mortgage origination.

Social, ethical and environmental (SEE) risks and opportunities

Experian in North America has taken steps to incorporate consideration of SEE issues into its everyday processes, communicating its stance with employees, clients and industry advocates. Environmental initiatives are beginning to contribute energy and cost savings, which are reported in the full CR report at www.experiancrreport.com.

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