Experian Annual Report 2011 - Key performance indicators

Key performance indicators

Experian uses a number of key metrics to assess its performance. Experian’s financial objectives are to drive organic revenue growth, to maintain or grow EBIT margins and to convert at least 90% of EBIT into operating cash flow. The Group also deploys a series of non-financial indicators to monitor and gauge performance.

Total revenue growth In the year ended 31 March 2011, Experian increased its total revenue from continuing activities by 10% at constant exchange rates. Total continuing revenue increased by US$411m. See the financial review for definition of total revenue growth. For further information on revenue split by operating and business segment, see note 9 to the Group financial statements.

Organic revenue growth Experian returned to its target of mid-to-high single digit organic revenue growth in the year ended 31 March 2011, increasing by 8%, with growth across all regions and business activities. See the financial review for definition of organic revenue growth.

EBIT (US$m) and margin In the year ended 31 March 2011, Experian increased its total EBIT at constant exchange rates by 12% to US$1,044m. EBIT from continuing activities increased 11% at constant exchange rates. The Group again met its margin objective, with a 30 basis points expansion in margin from continuing activities to 24.8%. This was achieved while continuing to invest organically in future growth initiatives. 2007 to 2010 restated to exclude FARES. EBIT includes discontinuing activities.

Revenue dependence on top 20 clients (percentage of total revenue) Experian aims to reduce its reliance on any single client and to increase the balance and diversity of its revenue base. In the year ended 31 March 2011, the Group made progress against this objective with further reduction in revenue dependency on our top 20 clients.

Percentage of revenue from customer segments other than financial services Experian aims to diversify beyond financial services by expanding into new customer segments including SME, healthcare payments, insurance, public sector, telecommunications and utilities. Experian now generates 67% of revenue from non-financial verticals.

Cash flow (US$m) and cash flow conversion Experian aims to convert at least 90% of its EBIT into operating cash flow each year. In the year ended 31 March 2011, this target was exceeded, converting 98% of EBIT into operating cash flow. 2007 to 2010 restated to exclude FARES. See the Group financial statements and the financial review for definition of operating cash flow and cash flow conversion. For additional information on cash flow see the Group cash flow statement.

Carbon footprint (000’s tonnes) Experian’s environmental impact is largely the result of energy use in buildings, especially its data centres, and employee travel. Steps have been taken to ensure Experian steadily reduces energy consumption and hence cost, including increased use of energy from renewable sources. Where emissions factors have changed, Experian has applied the most recent factors retrospectively. Data in respect of air travel was included for the first time in 2007. 2010 and 2011 data reflects improved measurement and estimation processes which it has not been possible to apply to previous years’ data. See the full CR report for details and calculation methods and further information on how Experian is minimising its impact on the environment at www.experiancrreport.com.

Employee engagement Experian’s people are at the heart of its business success and are a key resource. An all-employee global people survey is conducted every 18 months to monitor the degree of employee engagement, as well as to assess general levels of satisfaction and involvement at work. Percentage score calculated by the degree of positive response to a specified range of questions. The 2007 score is an amalgamation of regional surveys conducted over a two-year period. The next survey will be conducted in November 2011. Please refer to the key resources section for further information on how people are a key resource at Experian.

Percentage of revenue from Latin America, EMEA and Asia Pacific Experian aims to diversify beyond its traditional regions of North America and UK and Ireland by penetrating further into Latin America, EMEA and Asia Pacific. In the year ended 31 March 2011, Experian made good progress towards its goal to generate between 30 to 40% of global revenue from these regions by 2014. % based on revenue from continuing activities.

Countries with offices As a global business, Experian aims to support its clients around multiple territories across the world and seeks to realise opportunities in new geographies. The number of countries in which Experian operates has continued to rise and it currently has offices in 41 countries.

Number of consumer credit bureaux Experian’s consumer credit bureaux are the foundation for its consumer credit-related activities. It owns consumer credit bureaux in 14 countries and has an interest in a further two.

Number of business credit bureaux Experian’s business credit bureaux are the foundation for its business information activities. It owns business credit bureaux in 10 countries and has an interest in a further two. Please refer to the business and market overview section for further information on Credit Services.