Document_and_Entity_Informatio
Document and Entity Information | 3 Months Ended | |
In Millions, unless otherwise specified | Mar. 31, 2014 | Apr. 18, 2014 |
Document and Entity Information [Abstract] | ' | ' |
Entity Registrant Name | 'MCGRAW HILL FINANCIAL INC | ' |
Entity Central Index Key | '0000064040 | ' |
Document Type | '10-Q | ' |
Document Period End Date | 31-Mar-14 | ' |
Amendment Flag | 'false | ' |
Document Fiscal Year Focus | '2014 | ' |
Document Fiscal Period Focus | 'Q1 | ' |
Current Fiscal Year End Date | '--12-31 | ' |
Entity Filer Category | 'Large Accelerated Filer | ' |
Entity Common Stock, Shares Outstanding | ' | 272.2 |
Consolidated_Statements_of_Inc
Consolidated Statements of Income (Unaudited) (USD $) | 3 Months Ended | |
In Millions, except Per Share data, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Income Statement [Abstract] | ' | ' |
Revenue | $1,236 | $1,181 |
Expenses: | ' | ' |
Operating-related expenses | 411 | 374 |
Selling and general expenses | 362 | 494 |
Depreciation | 21 | 23 |
Amortization of intangibles | 12 | 12 |
Total expenses | 806 | 903 |
Operating profit | 430 | 278 |
Interest expense, net | 14 | 15 |
Income from continuing operations before taxes on income | 416 | 263 |
Provision for taxes on income | 141 | 89 |
Income from continuing operations | 275 | 174 |
Discontinued operations, net of tax: | ' | ' |
Loss from discontinued operations | 0 | -31 |
Gain on sale of discontinued operations | 0 | 612 |
Discontinued operations, net | 0 | 581 |
Net income | 275 | 755 |
Less: net income from continuing operations attributable to noncontrolling interests | -27 | -21 |
Less: net loss from discontinued operations attributable to noncontrolling interests | 0 | 1 |
Net income | 248 | 735 |
Amounts attributable to McGraw Hill Financial, Inc. common shareholders: | ' | ' |
Income from continuing operations | 248 | 153 |
Income from discontinued operations | 0 | 582 |
Net income | $248 | $735 |
Income from continuing operations: | ' | ' |
Basic (in dollars per share) | $0.91 | $0.55 |
Diluted (in dollars per share) | $0.89 | $0.54 |
Income from discontinued operations: | ' | ' |
Basic (in dollars per share) | $0 | $2.07 |
Diluted (in dollars per share) | $0 | $2.05 |
Net income: | ' | ' |
Basic (in dollars per share) | $0.91 | $2.62 |
Diluted (in dollars per share) | $0.89 | $2.59 |
Weighted-average number of common shares outstanding: | ' | ' |
Basic (in shares) | 271.8 | 280.5 |
Diluted (in shares) | 277.2 | 284.3 |
Dividend declared per common share (in usd per share) | $0.30 | $0.28 |
Consolidated_Statements_of_Com
Consolidated Statements of Comprehensive Income (Unaudited) (USD $) | 3 Months Ended | |
In Millions, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Statement of Comprehensive Income [Abstract] | ' | ' |
Net income | $275 | $755 |
Other comprehensive income: | ' | ' |
Foreign currency translation adjustment | 4 | 67 |
Income tax effect | -1 | -7 |
Foreign currency translation adjustment, net of income tax effect | 3 | 60 |
Pension and other postretirement benefit plans | 2 | 3 |
Income tax effect | -1 | -3 |
Pension and other post-retirement benefit plans, net of income tax effect | 1 | 0 |
Unrealized gain on investments and forward exchange contracts | 3 | 8 |
Income tax effect | -1 | -4 |
Unrealized gain (loss) on investments and forward exchange contracts, net of income tax effect | 2 | 4 |
Comprehensive income | 281 | 819 |
Less: comprehensive income attributable to nonredeemable noncontrolling interests | -3 | -3 |
Less: comprehensive income attributable to redeemable noncontrolling interests | -24 | -18 |
Comprehensive income attributable to McGraw Hill Financial, Inc. | $254 | $798 |
Consolidated_Balance_Sheets
Consolidated Balance Sheets (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
In Millions, unless otherwise specified | ||
Current assets: | ' | ' |
Cash and equivalents | $1,531 | $1,542 |
Accounts receivable, net of allowance for doubtful accounts: 2014 - $46; 2013 - $52 | 988 | 979 |
Deferred income taxes | 110 | 108 |
Prepaid and other current assets | 235 | 307 |
Total current assets | 2,864 | 2,936 |
Property and equipment, net of accumulated depreciation: 2014 - $629; 2013 - $617 | 242 | 249 |
Goodwill | 1,413 | 1,412 |
Other intangible assets, net | 1,036 | 1,033 |
Asset for pension benefits | 277 | 261 |
Other non-current assets | 179 | 170 |
Total assets | 6,011 | 6,061 |
Current liabilities: | ' | ' |
Accounts payable | 206 | 219 |
Accrued compensation and contributions to retirement plans | 212 | 427 |
Income taxes currently payable | 75 | 15 |
Unearned revenue | 1,310 | 1,309 |
Other current liabilities | 451 | 402 |
Total current liabilities | 2,254 | 2,372 |
Long-term debt | 799 | 799 |
Pension and other postretirement benefits | 265 | 264 |
Other non-current liabilities | 476 | 472 |
Total liabilities | 3,794 | 3,907 |
Redeemable noncontrolling interest (Note 7) | 810 | 810 |
Commitments and contingencies (Note 11) | ' | ' |
Equity: | ' | ' |
Common stock | 412 | 412 |
Additional paid-in capital | 348 | 447 |
Retained income | 7,565 | 7,384 |
Accumulated other comprehensive loss | -190 | -196 |
Less: common stock in treasury | -6,772 | -6,746 |
Total equity — controlling interests | 1,363 | 1,301 |
Total equity — noncontrolling interests | 44 | 43 |
Total equity | 1,407 | 1,344 |
Total liabilities and equity | $6,011 | $6,061 |
Consolidated_Balance_Sheets_Pa
Consolidated Balance Sheets (Parenthetical) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
In Millions, unless otherwise specified | ||
Statement of Financial Position [Abstract] | ' | ' |
Accounts receivable, allowance for doubtful accounts | $46 | $52 |
Property and equipment, accumulated depreciation | $629 | $617 |
Consolidated_Statements_of_Cas
Consolidated Statements of Cash Flows (Unaudited) (USD $) | 3 Months Ended | |
In Millions, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Operating Activities: | ' | ' |
Net income | $275 | $755 |
Less: discontinued operations, net | 0 | 581 |
Income from continuing operations | 275 | 174 |
Adjustments to reconcile income from continuing operations to cash provided by (used for) operating activities from continuing operations: | ' | ' |
Depreciation | 21 | 23 |
Amortization of intangibles | 12 | 12 |
Provision for losses on accounts receivable | -4 | 11 |
Stock-based compensation | 18 | 21 |
Other | 4 | 88 |
Changes in operating assets and liabilities, net of effect of acquisitions and dispositions: | ' | ' |
Accounts receivable | -9 | -46 |
Prepaid and other current assets | -6 | -25 |
Accounts payable and accrued expenses | -297 | -242 |
Unearned revenue | 1 | 63 |
Other current liabilities | 33 | 14 |
Net change in prepaid/accrued income taxes | 95 | -148 |
Net change in other assets and liabilities | -23 | 8 |
Cash provided by (used for) operating activities from continuing operations | 120 | -47 |
Investing Activities: | ' | ' |
Capital expenditures | -20 | -22 |
Acquisitions, net of cash acquired | -15 | 0 |
Cash used for investing activities from continuing operations | -35 | -22 |
Financing Activities: | ' | ' |
Repayments of short-term debt, net | 0 | -457 |
Dividends paid to shareholders | -82 | -79 |
Dividends and other payments paid to noncontrolling interests | -15 | -17 |
Repurchase of treasury shares | -164 | -500 |
Exercise of stock options | 93 | 74 |
Excess tax benefits from share-based payments | 72 | 8 |
Cash used for financing activities from continuing operations | -96 | -971 |
Effect of exchange rate changes on cash from continuing operations | 0 | -23 |
Cash used for continuing operations | -11 | -1,063 |
Discontinued Operations: | ' | ' |
Cash provided by operating activities | 0 | 73 |
Cash provided by investing activities | 0 | 2,159 |
Cash used for financing activities | 0 | -25 |
Effect of exchange rate changes on cash | 0 | 1 |
Cash provided by discontinued operations | 0 | 2,208 |
Net change in cash and equivalents | -11 | 1,145 |
Cash and equivalents at beginning of period | 1,542 | 760 |
Cash and equivalents at end of period | $1,531 | $1,905 |
Consolidated_Statements_of_Equ
Consolidated Statements of Equity (USD $) | Total | Common Stock $1 par | Additional Paid-in Capital | Retained Income | Accumulated Other Comprehensive Loss | Less: Treasury Stock | Total MHFI Equity | Noncontrolling Interests | |
In Millions, unless otherwise specified | |||||||||
Balance as of December 31, 2013 at Dec. 31, 2013 | $1,344 | $412 | $447 | $7,384 | ($196) | $6,746 | $1,301 | $43 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ' | ' | ' | ' | ' | ' | ' | ' | |
Comprehensive Income | [1] | 257 | ' | ' | 248 | 6 | ' | 254 | 3 |
Dividends | -82 | ' | ' | -78 | ' | ' | -78 | -4 | |
Share repurchases | -174 | ' | ' | ' | ' | 174 | -174 | ' | |
Employee stock plans, net of tax benefit | 49 | ' | -99 | ' | ' | -148 | 49 | ' | |
Change in redemption value of redeemable noncontrolling interest | 11 | ' | ' | 11 | ' | ' | 11 | ' | |
Other | 2 | ' | ' | ' | ' | ' | 0 | 2 | |
Net income attributable to noncontrolling interest | 24 | ' | ' | ' | ' | ' | ' | ' | |
Balance as of March 31, 2014 at Mar. 31, 2014 | $1,407 | $412 | $348 | $7,565 | ($190) | $6,772 | $1,363 | $44 | |
[1] | Excludes $24 million attributable to our redeemable noncontrolling interest. |
Nature_of_Operations_and_Basis
Nature of Operations and Basis of Presentation | 3 Months Ended | |
Mar. 31, 2014 | ||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ' | |
Nature of Operations and Basis of Presentation | ' | |
Nature of Operations and Basis of Presentation | ||
McGraw Hill Financial, Inc. (together with its consolidated subsidiaries, "McGraw Hill Financial," the “Company,” “we,” “us” or “our”) is a leading ratings, benchmarks and analytics provider serving the global capital, commodities and commercial markets. The capital markets include asset managers, banks, exchanges, issuers and financial advisors; the commodities markets include producers, traders and intermediaries within energy, metals, and agriculture; and the commercial markets include professionals and corporate executives within automotive, construction and marketing / research information services. | ||
Our operations consist of four reportable segments: Standard & Poor’s Ratings Services (“S&P Ratings”), S&P Capital IQ, S&P Dow Jones Indices ("S&P DJ Indices") and Commodities & Commercial Markets (“C&C”). | ||
• | S&P Ratings is an independent provider of credit ratings, research and analytics, offering investors and market participants information, ratings and benchmarks. | |
• | S&P Capital IQ is a global provider of multi-asset-class data, research and analytical capabilities, which integrate cross-asset analytics and desktop services. | |
• | S&P DJ Indices is a global index provider that maintains a wide variety of valuation and index benchmarks for investment advisors, wealth managers and institutional investors. | |
• | C&C consists of business-to-business companies specializing in commercial and commodities markets that deliver their customers access to high-value information, data, analytic services and pricing benchmarks. C&C's brands include Platts, J.D. Power and McGraw Hill Construction. | |
On March 18, 2014, we announced we are completing our portfolio rationalization with the evaluation of strategic alternatives for McGraw Hill Construction within our C&C segment. | ||
The accompanying unaudited financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. Therefore, the financial statements included herein should be read in conjunction with the financial statements and notes included in our Form 10-K for the year ended December 31, 2013 (our “Form 10-K”). | ||
In the opinion of management all normal recurring adjustments considered necessary for a fair statement of the results of the interim periods have been included. The operating results for the three months ended March 31, 2014 are not necessarily indicative of the results that may be expected for the full year. Certain prior-year amounts have been reclassified to conform to the current presentation. | ||
Our critical accounting estimates are disclosed in Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations, in our Form 10-K. On an ongoing basis, we evaluate our estimates and assumptions, including those related to revenue recognition, allowance for doubtful accounts, valuation of long-lived assets, goodwill and other intangible assets, pension plans, incentive compensation and stock-based compensation, income taxes, contingencies and redeemable noncontrolling interests. Since the date of our Form 10-K, there have been no material changes to our critical accounting policies and estimates. |
Acquisitions_and_Divestitures
Acquisitions and Divestitures | 3 Months Ended | |||
Mar. 31, 2014 | ||||
Business Combinations [Abstract] | ' | |||
Acquisitions and Divestitures | ' | |||
Acquisitions and Divestitures | ||||
Acquisitions | ||||
In March of 2014, we acquired the intellectual property of a family of Broad Market Indices (“BMI”) from Citigroup Global Markets Inc., that will be integrated into our S&P DJ Indices segment. The BMI provides a broad measure of the global equities markets which includes approximately 11,000 companies in more than 52 countries covering both developed and emerging markets. We accounted for the acquisition of the intellectual property on a cost basis and it was not material to our consolidated financial statements. | ||||
During the three months ended March 31, 2013, we did not complete any acquisitions. | ||||
Divestitures | ||||
During the three months ended March 31, 2014, we did not complete any dispositions. | ||||
On March 22, 2013, we completed the sale of McGraw-Hill Education ("MHE") to investment funds affiliated with Apollo Global Management, LLC for a purchase price of $2.4 billion in cash. We recorded an after-tax gain on the sale of $612 million for the three months ended March 31, 2013, which is included in discontinued operations, net in the consolidated statement of income. During the three months ended September 30, 2013, we adjusted the after tax gain on the sale of MHE, primarily due to post-closing working capital adjustments. For the year ended December 31, 2013, we recorded an after-tax gain on the sale of $589 million. We have used a portion of the after-tax proceeds from the sale to pay down short-term debt, for the special dividend paid in 2012, and to continue share repurchases. We intend to continue to use a portion of the after-tax proceeds to make selective acquisitions and investments. | ||||
The key components of income from discontinued operations for the three months ended March 31, 2013 consist of the following: | ||||
(in millions) | ||||
Revenue | $ | 268 | ||
Expenses | 314 | |||
Operating loss | (46 | ) | ||
Interest expense, net | 1 | |||
Loss before tax benefit | (47 | ) | ||
Tax benefit | (16 | ) | ||
Loss from discontinued operations, net of tax | (31 | ) | ||
Pre-tax gain on sale from discontinued operations | 920 | |||
Provision for taxes on income | 308 | |||
Gain on sale of discontinued operations, net of tax | 612 | |||
Discontinued operations, net | 581 | |||
Less: net loss attributable to noncontrolling interests | (1 | ) | ||
Income from discontinued operations attributable to McGraw Hill Financial, Inc. common shareholders | $ | 582 | ||
Income_Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2014 | |
Income Tax Disclosure [Abstract] | ' |
Income Taxes | ' |
Income Taxes | |
The effective income tax rate for continuing operations was 34.0% and 33.7%, for the three months ended March 31, 2014 and 2013, respectively. The increase in the effective income tax rate was primarily due to pre-tax legal settlements of approximately $77 million recorded in the comparable prior-year period, partially offset by an increase in income in lower tax rate jurisdictions during the three months ended March 31, 2014. | |
At the end of each interim period, we estimate the annual effective tax rate and apply that rate to our ordinary quarterly earnings. The tax expense or benefit related to significant, unusual or extraordinary items that will be separately reported or reported net of their related tax effect, and are individually computed, are recognized in the interim period in which those items occur. In addition, the effect of changes in enacted tax laws or rates or tax status is recognized in the interim period in which the change occurs. | |
As of March 31, 2014 and December 31, 2013, the total amount of federal, state and local, and foreign unrecognized tax benefits was $88 million and $82 million, respectively, exclusive of interest and penalties. We recognize accrued interest and penalties related to unrecognized tax benefits in interest expense and operating-related expense, respectively. In addition to the unrecognized tax benefits, as of March 31, 2014 and December 31, 2013, we had $19 million of accrued interest and penalties associated with uncertain tax positions. | |
Based on the current status of income tax audits, we believe that it is reasonably possible that the total amount of unrecognized tax benefits will significantly decrease in the next twelve months. Although the ultimate resolution of our tax audits is unpredictable, the resulting change in our unrecognized tax benefits could have a material impact on our results of operations and/or cash flows. |
Debt
Debt | 3 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
Debt Disclosure [Abstract] | ' | |||||||
Debt | ' | |||||||
Debt | ||||||||
(in millions) | March 31, | December 31, | ||||||
2014 | 2013 | |||||||
5.9% Senior Notes, due 2017 1 | $ | 400 | $ | 400 | ||||
6.55% Senior Notes, due 2037 2 | 399 | 399 | ||||||
Long-term debt | $ | 799 | $ | 799 | ||||
1 | Interest payments are due semiannually on April 15 and October 15, and, as of March 31, 2014, the unamortized debt discount is less than $1 million. | |||||||
2 | Interest payments are due semiannually on May 15 and November 15, and, as of March 31, 2014, the unamortized debt discount is approximately $1 million. | |||||||
The fair value of our long-term debt borrowings was $841 million and $801 million as of March 31, 2014 and December 31, 2013, respectively, and was estimated based on quoted market prices. | ||||||||
Currently, we have the ability to borrow a total of $1.0 billion through our commercial paper program, which is supported by our $1.0 billion four-year credit agreement (our “credit facility”) that we entered into in June of 2013. This credit facility will terminate on June 19, 2017. As of March 31, 2014 and December 31, 2013, we had no outstanding commercial paper. | ||||||||
We pay a commitment fee of 20 to 45 basis points for our credit facility, depending on our indebtedness to cash flow ratio, whether or not amounts have been borrowed, and currently pay a commitment fee of 25 basis points. The interest rate on borrowings under our credit facility is, at our option, calculated using rates that are primarily based on either the prevailing London Inter-Bank Offer Rate, the prime rate determined by the administrative agent or the Federal Funds Rate. For certain borrowings under this credit facility, there is also a spread based on our indebtedness to cash flow ratio added to the applicable rate. | ||||||||
Our credit facility contains certain covenants. The only financial covenant requires that our indebtedness to cash flow ratio, as defined in our credit facility, is not greater than 3.25 to 1, and this covenant level has never been exceeded. |
Employee_Benefits
Employee Benefits | 3 Months Ended |
Mar. 31, 2014 | |
Compensation and Retirement Disclosure [Abstract] | ' |
Employee Benefits | ' |
Employee Benefits | |
We maintain a number of active defined contribution retirement plans for our employees. The majority of our defined benefit plans are frozen. As a result, no new employees will be permitted to enter these plans and no additional benefits for current participants in the frozen plans will be accrued. | |
We have supplemental benefit plans that provide senior management with supplemental retirement, disability and death benefits. Certain supplemental retirement benefits are based on final monthly earnings. In addition, we sponsor voluntary 401(k) plans under which we may match employee contributions up to certain levels of compensation as well as profit-sharing plans under which we contribute a percentage of eligible employees' compensation to the employees' accounts. | |
We also provide certain medical, dental and life insurance benefits for active and retired employees and eligible dependents. The medical and dental plans and supplemental life insurance plan are contributory, while the basic life insurance plan is noncontributory. We currently do not prefund any of these plans. | |
We recognize the funded status of our defined benefit retirement and postretirement plans in the consolidated balance sheets, with a corresponding adjustment to accumulated other comprehensive loss, net of taxes. The amounts in accumulated other comprehensive loss represent unrecognized actuarial losses and unrecognized prior service costs. These amounts will be subsequently recognized as net periodic pension cost pursuant to our accounting policy for amortizing such amounts. | |
As discussed in our Form 10-K, we changed certain discount rate assumptions and our expected return on assets assumption for our retirement plans, which became effective on January 1, 2014. The effect of the assumption changes on retirement expense for the three months ended March 31, 2014 did not have a material impact on our consolidated financial statements. | |
In the first quarter of 2014, we contributed $5 million to our retirement plans and expect to make additional required contributions of approximately $18 million to our retirement plans during the remainder of the year. We may elect to make additional non-required contributions depending on investment performance and the pension plan status in the remaining nine months of 2014. |
StockBased_Compensation
Stock-Based Compensation | 3 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ' | |||||||
Stock-Based Compensation | ' | |||||||
Stock-Based Compensation | ||||||||
We issue stock-based incentive awards to our eligible employees and Directors under the 2002 Employee Stock Incentive Plan and a Director Deferred Stock Ownership Plan. The 2002 Employee Stock Incentive Plan permits the granting of nonqualified stock options, stock appreciation rights, performance stock, restricted stock and other stock-based awards. | ||||||||
Stock-based compensation for the three months ended March 31 is as follows: | ||||||||
(in millions) | 2014 | 2013 | ||||||
Stock option expense | $ | 3 | $ | 2 | ||||
Restricted stock and unit awards expense | 15 | 19 | ||||||
Total stock-based compensation expense | $ | 18 | $ | 21 | ||||
Equity
Equity | 3 Months Ended | ||||||||||||||||
Mar. 31, 2014 | |||||||||||||||||
Equity [Abstract] | ' | ||||||||||||||||
Equity | ' | ||||||||||||||||
Equity | |||||||||||||||||
Stock Repurchases | |||||||||||||||||
On December 4, 2013, the Board of Directors approved a new stock repurchase program authorizing the purchase of 50 million shares (the "2013 Repurchase Program"), which was approximately 18% of the total shares of our outstanding common stock at that time. | |||||||||||||||||
In any period, share repurchase transactions could result in timing differences between the recognition of those repurchases and their settlement for cash. This could result in a difference between the cash used for financing activities related to common stock repurchased and the comparable change in equity. | |||||||||||||||||
Share repurchases for the three months ended March 31 were as follows: | |||||||||||||||||
(in millions, except average price) | 2014 | 2013 | |||||||||||||||
Total number of shares purchased 1 | 2.2 | 7.2 | |||||||||||||||
Average price paid per share 2 | $ | 78.47 | $ | — | |||||||||||||
Total cash utilized 3 | $ | 174 | $ | 500 | |||||||||||||
1 | The three month period ended March 31, 2013 includes shares received as part of our accelerated share repurchase agreements described in more detail below. | ||||||||||||||||
2 | In March of 2014, 0.3 million shares were repurchased for $21 million, which settled in April of 2014. Excluding these shares, the average price paid per share was $78.99. | ||||||||||||||||
3 | In December of 2013, 0.1 million shares were repurchased for approximately $10 million, which settled in January of 2014. Cash used for financing activities only reflects those shares which settled during the three months ended March 31, 2014 resulting in $164 million of cash used to repurchase shares. | ||||||||||||||||
Our purchased shares may be used for general corporate purposes, including the issuance of shares for stock compensation plans and to offset the dilutive effect of the exercise of employee stock options. As of March 31, 2014, 47.8 million shares remained available under the 2013 Repurchase Program. The 2013 Repurchase Program has no expiration date and purchases under this program may be made from time to time on the open market and in private transactions, depending on market conditions. | |||||||||||||||||
Accelerated Share Repurchase Program | |||||||||||||||||
We entered into an accelerated share repurchase (“ASR”) agreement with a financial institution on March 25, 2013 to initiate share repurchases aggregating $500 million. The ASR agreement was structured as a capped ASR agreement in which we paid $500 million and received an initial delivery of approximately 7.2 million shares during the three months ended March 31, 2013, with an additional 1.4 million shares received on April 1, 2013, in the aggregate, representing the minimum number of shares of our common stock to be repurchased based on a calculation using a specific capped price per share. The total number of shares ultimately purchased was determined based on the volume weighted-average share price (“VWAP”), minus a discount, of our common stock from March 25, 2013 through July 22, 2013. On July 25, 2013, we received a final incremental delivery of 0.7 million shares determined using a VWAP of $53.7995, bringing the total amount of shares received to 9.3 million. | |||||||||||||||||
Redeemable Noncontrolling Interests | |||||||||||||||||
The agreement with the minority partners of our S&P Dow Jones Indices LLC established in June of 2012 contains redemption features whereby interests held by minority partners are redeemable either (i) at the option of the holder or (ii) upon the occurrence of an event that is not solely within our control. Specifically, under the terms of the operating agreement of S&P Dow Jones Indices LLC, after December 31, 2017, CME Group, Inc. ("CME Group") and CME Group Index Services LLC ("CGIS") will have the right at any time to sell, and we are obligated to buy, at least 20% of their share in S&P Dow Jones Indices LLC. In addition, in the event there is a change of control of the Company, for the 15 days following a change in control, CME Group and CGIS will have the right to put their interest to us at the then fair value of CME Group's and CGIS' minority interest. | |||||||||||||||||
If interests were to be redeemed under this agreement, we would generally be required to purchase the interest at fair value on the date of redemption. This interest is presented on the consolidated balance sheets outside of equity under the caption “Redeemable noncontrolling interest” with an initial value based on fair value for the portion attributable to the net assets we acquired, and based on our historical cost for the portion attributable to our S&P Index business. We adjust the redeemable noncontrolling interest each reporting period to its estimated redemption value, but never less than its initial fair value, considering a combination of an income and market valuation approach. Our income and market valuation approaches may incorporate Level 3 fair value measures for instances when observable inputs are not available, including assumptions related to expected future net cash flows, long-term growth rates, the timing and nature of tax attributes, and the redemption features. Any adjustments to the redemption value will impact retained income. | |||||||||||||||||
Noncontrolling interests that do not contain such redemption features are presented in equity. | |||||||||||||||||
Changes to redeemable noncontrolling interest during the three months ended March 31, 2014 were as follows: | |||||||||||||||||
(in millions) | |||||||||||||||||
Balance as of December 31, 2013 | $ | 810 | |||||||||||||||
Net income attributable to noncontrolling interest | 24 | ||||||||||||||||
Distributions to noncontrolling interest | (13 | ) | |||||||||||||||
Redemption value adjustment | (11 | ) | |||||||||||||||
Balance as of March 31, 2014 | $ | 810 | |||||||||||||||
Accumulated Other Comprehensive Loss | |||||||||||||||||
The following table summarizes the changes in the components of accumulated other comprehensive loss for the three months ended March 31, 2014: | |||||||||||||||||
(in millions) | Foreign Currency Translation Adjustment | Pension and Postretirement Benefit Plans | Unrealized Gain (Loss) on Forward Exchange Contracts | Accumulated Other Comprehensive Loss | |||||||||||||
Balance as of December 31, 2013 | $ | 23 | $ | (216 | ) | $ | (3 | ) | $ | (196 | ) | ||||||
Other comprehensive income before reclassifications | 3 | — | 2 | 5 | |||||||||||||
Reclassifications from accumulated other comprehensive loss to net earnings | — | 1 | 1 | — | 1 | ||||||||||||
Net other comprehensive income | 3 | 1 | 2 | 6 | |||||||||||||
Balance as of March 31, 2014 | $ | 26 | $ | (215 | ) | $ | (1 | ) | $ | (190 | ) | ||||||
1 | See Note 5 — Employee Benefits for additional details of items reclassed from accumulated other comprehensive loss to net earnings. | ||||||||||||||||
The net actuarial loss and prior service cost related to pension and other postretirement benefit plans included in other comprehensive income is net of a tax provision of $1 million for the three months ended March 31, 2014. |
Earnings_Per_Share
Earnings Per Share | 3 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
Earnings Per Share [Abstract] | ' | |||||||
Earnings Per Share | ' | |||||||
Earnings Per Share | ||||||||
Basic earnings per common share (“EPS”) is computed by dividing net income attributable to the common shareholders of the Company by the weighted-average number of common shares outstanding. Diluted EPS is computed in the same manner as basic EPS, except the number of shares is increased to include additional common shares that would have been outstanding if potential common shares with a dilutive effect had been issued. Potential common shares consist primarily of stock options, restricted stock and restricted stock units calculated using the treasury stock method. | ||||||||
The calculation for basic and diluted EPS for the three months ended March 31 is as follows: | ||||||||
(in millions, except per share amounts) | 2014 | 2013 | ||||||
Amounts attributable to McGraw Hill Financial, Inc. common shareholders: | ||||||||
Income from continuing operations | $ | 248 | $ | 153 | ||||
Income from discontinued operations | — | 582 | ||||||
Net income | $ | 248 | $ | 735 | ||||
Basic weighted-average number of common shares outstanding | 271.8 | 280.5 | ||||||
Effect of stock options and other dilutive securities | 5.4 | 3.8 | ||||||
Diluted weighted-average number of common shares outstanding | 277.2 | 284.3 | ||||||
Earnings per share attributable to McGraw Hill Financial, Inc. common shareholders: | ||||||||
Income from continuing operations: | ||||||||
Basic | $ | 0.91 | $ | 0.55 | ||||
Diluted | $ | 0.89 | $ | 0.54 | ||||
Income from discontinued operations: | ||||||||
Basic | $ | — | $ | 2.07 | ||||
Diluted | $ | — | $ | 2.05 | ||||
Net income: | ||||||||
Basic | $ | 0.91 | $ | 2.62 | ||||
Diluted | $ | 0.89 | $ | 2.59 | ||||
Restricted performance shares outstanding of 0.9 million and 1.4 million as of March 31, 2014 and 2013, respectively, were not included in the computation of diluted EPS because the necessary performance conditions had not been met. | ||||||||
The effect of the potential exercise of stock options is excluded from the computation of diluted EPS when the average market price of our common stock is lower than the exercise price of the related option during the period because the effect would have been antidilutive. For the three months ended March 31, 2014, there were no stock options excluded from the computation as compared to 3.0 million stock options excluded from the computation for the three months ended March 31, 2013. |
Restructuring
Restructuring | 3 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
Restructuring and Related Activities [Abstract] | ' | |||||||
Restructuring | ' | |||||||
Restructuring | ||||||||
During 2013, we continued to evaluate our cost structure and further identified cost savings associated with streamlining our management structure and our decision to exit non-strategic businesses. The resulting restructuring plan consisted of a company-wide workforce reduction of approximately 520 positions and is further detailed below. The charges for the restructuring plan are classified as selling and general expenses within the consolidated statements of income and the reserves are included in other current liabilities in the consolidated balance sheets. | ||||||||
In certain circumstances, reserves are no longer needed because of efficiencies in carrying out the plans or because employees previously identified for separation resigned from the Company and did not receive severance or were reassigned due to circumstances not foreseen when the original plans were initiated. In these cases, we reverse reserves through the consolidated statements of income during the period when it is determined they are no longer needed. | ||||||||
The initial restructuring charge recorded and the ending reserve balance as of March 31, 2014 by segment is as follows: | ||||||||
(in millions) | Initial Charge Recorded | Ending Reserve Balance | ||||||
S&P Ratings | $ | 13 | $ | 12 | ||||
S&P Capital IQ | 10 | 7 | ||||||
C&C | 10 | 5 | ||||||
Corporate | 16 | 8 | ||||||
Total | $ | 49 | $ | 32 | ||||
The ending reserve balance for the 2013 restructuring plan was $39 million as of December 31, 2013. For the three months ended March 31, 2014, we have reduced the reserve for the 2013 restructuring plan by $7 million. |
Segment_and_Related_Informatio
Segment and Related Information | 3 Months Ended | |||||||||||||||
Mar. 31, 2014 | ||||||||||||||||
Segment Reporting [Abstract] | ' | |||||||||||||||
Segment and Related Information | ' | |||||||||||||||
Segment and Related Information | ||||||||||||||||
We have four reportable segments: S&P Ratings, S&P Capital IQ, S&P DJ Indices and C&C. Our Chief Executive Officer is our chief operating decision-maker and evaluates performance of our segments and allocates resources based primarily on operating profit. Segment operating profit does not include unallocated expense or interest expense as these are costs that do not affect the operating results of our segments. | ||||||||||||||||
As part of our transformation to McGraw Hill Financial, a comprehensive review of our accounting and reporting practices and policies was undertaken. As a result, beginning on January 1, 2014, all shared operating services have been fully allocated to the segments utilizing a methodology that more closely aligns with each segment's usage of these services. The costs that remain in unallocated expense primarily relate to corporate center functions. The updated methodology is reflected in the segment results for the three months ended March 31, 2014 and accordingly, the segment results for the prior-year comparative period have been reclassified to conform with the new presentation. | ||||||||||||||||
A summary of operating results by segment for the three months ended March 31 is as follows: | ||||||||||||||||
2014 | 2013 | |||||||||||||||
(in millions) | Revenue | Operating Profit | Revenue | Operating Profit | ||||||||||||
S&P Ratings | $ | 569 | $ | 240 | $ | 561 | $ | 249 | ||||||||
S&P Capital IQ | 301 | 53 | 288 | 50 | ||||||||||||
S&P DJ Indices | 137 | 91 | 115 | 64 | ||||||||||||
C&C | 251 | 76 | 236 | 60 | ||||||||||||
Intersegment elimination 1 | (22 | ) | — | (19 | ) | — | ||||||||||
Total operating segments | 1,236 | 460 | 1,181 | 423 | ||||||||||||
Unallocated expense 2 | — | (30 | ) | — | (145 | ) | ||||||||||
Total | $ | 1,236 | $ | 430 | $ | 1,181 | $ | 278 | ||||||||
1 | Revenue for S&P Ratings and expenses for S&P Capital IQ include an intersegment royalty charged to S&P Capital IQ for the rights to use and distribute content and data developed by S&P Ratings. | |||||||||||||||
2 | The three months ended March 31, 2013, includes $44 million in costs necessary to enable the separation of MHE and reduce our cost structure and approximately $77 million for pre-tax legal settlements. | |||||||||||||||
See Note 2 — Acquisitions and Divestitures and Note 9 — Restructuring for additional actions that impacted the segment operating results. |
Commitments_and_Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2014 | |
Commitments and Contingencies Disclosure [Abstract] | ' |
Commitments and Contingencies | ' |
Commitments and Contingencies | |
Rental Expense and Lease Obligations | |
In December of 2003, we sold our 45% equity investment in Rock-McGraw, Inc., which owns our headquarters building in New York City, and remained an anchor tenant in our corporate headquarters building in New York City by concurrently leasing back space from the buyer through 2020. In December of 2013, we entered into an arrangement with the buyer to shorten the lease to December 2015 in exchange for approximately $60 million which was recorded as a reduction to the unrecognized deferred gain from the sale. The remaining gain is being amortized over the remaining lease term as a reduction in rent expense. | |
As of March 31, 2014, the remaining deferred gain was $39 million, as $6 million was amortized during the three months ended March 31, 2014. Interest expense associated with this operating lease for the three months ended March 31, 2014 was less than $1 million. | |
Related Party Agreements | |
In June of 2012, we entered into a new license agreement (the "License Agreement") with the holder of S&P Dow Jones Indices LLC noncontrolling interest, CME Group, which replaced the 2005 license agreement between S&P DJ Indices and CME Group. Under the terms of the License Agreement, S&P Dow Jones Indices LLC receives a share of the profits from the trading and clearing of CME Group's equity index products. During the three months ended March 31, 2014, S&P Dow Jones Indices LLC earned $12 million of revenue under the terms of the License Agreement. The entire amount of this revenue is included in our consolidated statement of income, and the portion related to the 27% noncontrolling interest is removed in net income attributable to noncontrolling interests. | |
Legal Matters | |
There have been no amendments to the disclosure in Note 12 — Commitments and Contingencies to the consolidated financial statements of our Form 10-K. | |
We believe that the claims asserted and/or contemplated in the proceedings described in Note 12 — Commitments and Contingencies to the consolidated financial statements of our Form 10-K have no basis and they will be vigorously defended by the Company and/or the subsidiaries involved. | |
In view of the inherent difficulty of predicting the outcome of legal matters, particularly where the claimants seek very large or indeterminate damages, or where the cases present novel legal theories, involve a large number of parties or are in early stages of discovery, we cannot state with confidence what the eventual outcome of the pending matters described in Note 12 — Commitments and Contingencies to the consolidated financial statements of our Form 10-K will be, what the timing of the ultimate resolution of these matters will be or what the eventual loss, fines, penalties or impact related to each pending matter may be. We believe, based on our current knowledge, the outcome of the legal actions, proceedings and investigations currently pending should not have a material, adverse effect on our consolidated financial statements. |
Recent_Accounting_Standards
Recent Accounting Standards | 3 Months Ended |
Mar. 31, 2014 | |
Accounting Changes and Error Corrections [Abstract] | ' |
Recent Accounting Standards | ' |
Recent Accounting Standards | |
In April of 2014, the Financial Accounting Standards Board (“FASB”) issued final guidance that raises the threshold for a disposal to qualify as a discontinued operation and requires new disclosures of both discontinued operations and certain other disposals that do not meet the definition of a discontinued operation. The guidance is intended to reduce the frequency of disposals reported as discontinued operations by focusing on strategic shifts that have or will have a major effect on an entity’s operations and financial results. In addition, the guidance permits companies to have continuing cash flows and significant continuing involvement with the disposed component. The FASB’s amended guidance is effective for our annual reporting period beginning January 1, 2015, however, early adoption is permitted. We do not expect the adoption of the guidance to have a significant impact on our consolidated financial statements. | |
In July of 2013, the FASB issued amended guidance that resolves the diversity in practice for the presentation of an unrecognized tax benefit when a net operating loss carryforward, a similar tax loss, or a tax credit carryforward exists. This new accounting guidance requires the netting of unrecognized tax benefits ("UTBs") against a deferred tax asset for a loss or other carryforward that would apply in settlement of the uncertain tax positions. Under the new standard, UTBs will be netted against all available same-jurisdiction loss or other tax carryforwards that would be utilized, rather than only against carryforwards that are created by the UTBs. The new standard requires prospective adoption but allows retrospective adoption for all periods presented. The amendments were effective on January 1, 2014, and the adoption of the guidance did not have a significant impact on our consolidated financial statements. | |
In March of 2013, the FASB issued amended guidance that resolves the diversity in practice for the accounting for the cumulative translation adjustment upon derecognition of certain subsidiaries or groups of assets within a foreign entity. The amended guidance requires that when a parent entity ceases to have a controlling financial interest in a subsidiary or group of assets within a foreign entity, the parent is required to release any related cumulative translation adjustment into net income in instances when a sale or transfer results in the complete or substantially complete liquidation of the foreign entity in which the subsidiary or group of assets had resided. Additionally, the amended guidance clarifies that the sale of an investment in a foreign entity includes both (1) events that result in the loss of a controlling financial interest in a foreign entity and (2) events that result in an acquirer obtaining control of an acquiree in which it held an equity interest immediately before the acquisition date. In these instances, an entity is required to release the cumulative translation adjustment into net income. The amendments were effective on January 1, 2014, and the adoption of the guidance did not have a significant impact on our consolidated financial statements. |
Acquisitions_and_Divestitures_
Acquisitions and Divestitures (Tables) | 3 Months Ended | |||
Mar. 31, 2014 | ||||
Business Combinations [Abstract] | ' | |||
Schedule of components of income and assets and liabilities from discontinued operations | ' | |||
The key components of income from discontinued operations for the three months ended March 31, 2013 consist of the following: | ||||
(in millions) | ||||
Revenue | $ | 268 | ||
Expenses | 314 | |||
Operating loss | (46 | ) | ||
Interest expense, net | 1 | |||
Loss before tax benefit | (47 | ) | ||
Tax benefit | (16 | ) | ||
Loss from discontinued operations, net of tax | (31 | ) | ||
Pre-tax gain on sale from discontinued operations | 920 | |||
Provision for taxes on income | 308 | |||
Gain on sale of discontinued operations, net of tax | 612 | |||
Discontinued operations, net | 581 | |||
Less: net loss attributable to noncontrolling interests | (1 | ) | ||
Income from discontinued operations attributable to McGraw Hill Financial, Inc. common shareholders | $ | 582 | ||
Debt_Tables
Debt (Tables) | 3 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
Debt Disclosure [Abstract] | ' | |||||||
Schedule of debt | ' | |||||||
(in millions) | March 31, | December 31, | ||||||
2014 | 2013 | |||||||
5.9% Senior Notes, due 2017 1 | $ | 400 | $ | 400 | ||||
6.55% Senior Notes, due 2037 2 | 399 | 399 | ||||||
Long-term debt | $ | 799 | $ | 799 | ||||
1 | Interest payments are due semiannually on April 15 and October 15, and, as of March 31, 2014, the unamortized debt discount is less than $1 million. | |||||||
2 | Interest payments are due semiannually on May 15 and November 15, and, as of March 31, 2014, the unamortized debt discount is approximately $1 million. |
StockBased_Compensation_Tables
Stock-Based Compensation (Tables) | 3 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | ' | |||||||
Stock-Based Compensation | ' | |||||||
Stock-based compensation for the three months ended March 31 is as follows: | ||||||||
(in millions) | 2014 | 2013 | ||||||
Stock option expense | $ | 3 | $ | 2 | ||||
Restricted stock and unit awards expense | 15 | 19 | ||||||
Total stock-based compensation expense | $ | 18 | $ | 21 | ||||
Equity_Tables
Equity (Tables) | 3 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
Equity [Abstract] | ' | |||||||
Schedule of stock repurchases | ' | |||||||
Share repurchases for the three months ended March 31 were as follows: | ||||||||
(in millions, except average price) | 2014 | 2013 | ||||||
Total number of shares purchased 1 | 2.2 | 7.2 | ||||||
Average price paid per share 2 | $ | 78.47 | $ | — | ||||
Total cash utilized 3 | $ | 174 | $ | 500 | ||||
1 | The three month period ended March 31, 2013 includes shares received as part of our accelerated share repurchase agreements described in more detail below. | |||||||
2 | In March of 2014, 0.3 million shares were repurchased for $21 million, which settled in April of 2014. Excluding these shares, the average price paid per share was $78.99. | |||||||
3 | In December of 2013, 0.1 million shares were repurchased for approximately $10 million, which settled in January of 2014. Cash used for financing activities only reflects those shares which settled during the three months ended March 31, 2014 resulting in $164 million of cash used to repurchase shares. | |||||||
Schedule of redeemable noncontrolling interest | ' | |||||||
Changes to redeemable noncontrolling interest during the three months ended March 31, 2014 were as follows: | ||||||||
(in millions) | ||||||||
Balance as of December 31, 2013 | $ | 810 | ||||||
Net income attributable to noncontrolling interest | 24 | |||||||
Distributions to noncontrolling interest | (13 | ) | ||||||
Redemption value adjustment | (11 | ) | ||||||
Balance as of March 31, 2014 | $ | 810 | ||||||
Earnings_Per_Share_Tables
Earnings Per Share (Tables) | 3 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
Earnings Per Share [Abstract] | ' | |||||||
Schedule of calculation for basic and diluted EPS | ' | |||||||
The calculation for basic and diluted EPS for the three months ended March 31 is as follows: | ||||||||
(in millions, except per share amounts) | 2014 | 2013 | ||||||
Amounts attributable to McGraw Hill Financial, Inc. common shareholders: | ||||||||
Income from continuing operations | $ | 248 | $ | 153 | ||||
Income from discontinued operations | — | 582 | ||||||
Net income | $ | 248 | $ | 735 | ||||
Basic weighted-average number of common shares outstanding | 271.8 | 280.5 | ||||||
Effect of stock options and other dilutive securities | 5.4 | 3.8 | ||||||
Diluted weighted-average number of common shares outstanding | 277.2 | 284.3 | ||||||
Earnings per share attributable to McGraw Hill Financial, Inc. common shareholders: | ||||||||
Income from continuing operations: | ||||||||
Basic | $ | 0.91 | $ | 0.55 | ||||
Diluted | $ | 0.89 | $ | 0.54 | ||||
Income from discontinued operations: | ||||||||
Basic | $ | — | $ | 2.07 | ||||
Diluted | $ | — | $ | 2.05 | ||||
Net income: | ||||||||
Basic | $ | 0.91 | $ | 2.62 | ||||
Diluted | $ | 0.89 | $ | 2.59 | ||||
Restructuring_Tables
Restructuring (Tables) | 3 Months Ended | |||||||
Mar. 31, 2014 | ||||||||
Restructuring and Related Activities [Abstract] | ' | |||||||
Schedule of initial restructuring charge recorded and the ending reserve balance | ' | |||||||
The initial restructuring charge recorded and the ending reserve balance as of March 31, 2014 by segment is as follows: | ||||||||
(in millions) | Initial Charge Recorded | Ending Reserve Balance | ||||||
S&P Ratings | $ | 13 | $ | 12 | ||||
S&P Capital IQ | 10 | 7 | ||||||
C&C | 10 | 5 | ||||||
Corporate | 16 | 8 | ||||||
Total | $ | 49 | $ | 32 | ||||
Segment_and_Related_Informatio1
Segment and Related Information (Tables) | 3 Months Ended | |||||||||||||||
Mar. 31, 2014 | ||||||||||||||||
Segment Reporting [Abstract] | ' | |||||||||||||||
Schedule of operating results by segment | ' | |||||||||||||||
A summary of operating results by segment for the three months ended March 31 is as follows: | ||||||||||||||||
2014 | 2013 | |||||||||||||||
(in millions) | Revenue | Operating Profit | Revenue | Operating Profit | ||||||||||||
S&P Ratings | $ | 569 | $ | 240 | $ | 561 | $ | 249 | ||||||||
S&P Capital IQ | 301 | 53 | 288 | 50 | ||||||||||||
S&P DJ Indices | 137 | 91 | 115 | 64 | ||||||||||||
C&C | 251 | 76 | 236 | 60 | ||||||||||||
Intersegment elimination 1 | (22 | ) | — | (19 | ) | — | ||||||||||
Total operating segments | 1,236 | 460 | 1,181 | 423 | ||||||||||||
Unallocated expense 2 | — | (30 | ) | — | (145 | ) | ||||||||||
Total | $ | 1,236 | $ | 430 | $ | 1,181 | $ | 278 | ||||||||
1 | Revenue for S&P Ratings and expenses for S&P Capital IQ include an intersegment royalty charged to S&P Capital IQ for the rights to use and distribute content and data developed by S&P Ratings. | |||||||||||||||
2 | The three months ended March 31, 2013, includes $44 million in costs necessary to enable the separation of MHE and reduce our cost structure and approximately $77 million for pre-tax legal settlements. |
Nature_of_Operations_and_Basis1
Nature of Operations and Basis of Presentation (Details) | 3 Months Ended |
Mar. 31, 2014 | |
Segment | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ' |
Number of reportable segments (in segments) | 4 |
Acquisitions_and_Divestitures_1
Acquisitions and Divestitures (Narrative) (Details) (USD $) | 1 Months Ended | 3 Months Ended | 0 Months Ended | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2014 | Mar. 31, 2014 | Mar. 31, 2013 | Mar. 22, 2013 | Mar. 31, 2013 | Dec. 31, 2013 | |
Country | MHE | MHE | MHE | |||
company | ||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ' | ' | ' | ' | ' | ' |
Minimum Number of Companies Represented in Broad Market Indices | 11,000 | ' | ' | ' | ' | ' |
Minimum Number of Countries Represented in Broad Market Indices | 52 | ' | ' | ' | ' | ' |
After-tax gain on sale of business | ' | $0 | $612,000,000 | ' | $612,000,000 | $589,000,000 |
Cash proceeds from sale of business | ' | ' | ' | $2,400,000,000 | ' | ' |
Acquisitions_and_Divestitures_2
Acquisitions and Divestitures (Details) (USD $) | 3 Months Ended | |
In Millions, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Components of income from discontinued operations | ' | ' |
Revenue | ' | $268 |
Expenses | ' | 314 |
Operating loss | ' | -46 |
Interest expense, net | ' | 1 |
Loss before tax benefit | ' | -47 |
Tax benefit | ' | -16 |
Loss from discontinued operations, net of tax | 0 | -31 |
Pre-tax gain on sale from discontinued operations | ' | 920 |
Provision for taxes on income | ' | 308 |
Gain on sale of discontinued operations, net of tax | 0 | 612 |
Discontinued operations, net | 0 | 581 |
Less: net loss attributable to noncontrolling interests | 0 | -1 |
Income from discontinued operations attributable to McGraw Hill Financial, Inc. common shareholders | $0 | $582 |
Income_Taxes_Details
Income Taxes (Details) (USD $) | 3 Months Ended | ||
In Millions, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 | Dec. 31, 2013 |
Income Tax Disclosure [Abstract] | ' | ' | ' |
Effective income tax rate | 34.00% | 33.70% | ' |
Unrecognized tax benefits | $88 | ' | $82 |
Accrued interest and penalties associated with uncertain tax positions | $19 | ' | $77 |
Debt_Details
Debt (Details) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
In Millions, unless otherwise specified | ||
Debt Instrument [Line Items] | ' | ' |
Long-term debt | $799 | $799 |
5.9% Senior Notes, due 2017 | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Long-term debt | 400 | 400 |
Interest rate | 5.90% | 5.90% |
Unamortized debt discount on senior notes | 1 | ' |
6.55% Senior Notes, due 2037 | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Long-term debt | 399 | 399 |
Interest rate | 6.55% | 6.55% |
Unamortized debt discount on senior notes | $1 | ' |
Debt_Narrative_Details
Debt (Narrative) (Details) (USD $) | 1 Months Ended | 3 Months Ended | |
Jun. 30, 2013 | Mar. 31, 2014 | Dec. 31, 2013 | |
Debt Instrument [Line Items] | ' | ' | ' |
Long-term debt fair value | ' | $841,000,000 | $801,000,000 |
4 Year Facility | ' | ' | ' |
Debt Instrument [Line Items] | ' | ' | ' |
Maximum borrowing capacity | 1,000,000,000 | 1,000,000,000 | ' |
Term of facility | '4 years | ' | ' |
Line of credit amount outstanding | ' | ' | $0 |
Commitment fee | ' | 0.25% | ' |
Minimum | 4 Year Facility | ' | ' | ' |
Debt Instrument [Line Items] | ' | ' | ' |
Commitment fee | ' | 0.20% | ' |
Maximum | 4 Year Facility | ' | ' | ' |
Debt Instrument [Line Items] | ' | ' | ' |
Commitment fee | ' | 0.45% | ' |
Indebtedness to cash flow | ' | 3.25 | ' |
Employee_Benefits_Details
Employee Benefits (Details) (USD $) | 3 Months Ended |
In Millions, unless otherwise specified | Mar. 31, 2014 |
Compensation and Retirement Disclosure [Abstract] | ' |
Contribution towards retirement plans | $5 |
Expected contributions towards of retirement plans | $18 |
StockBased_Compensation_Detail
Stock-Based Compensation (Details) (USD $) | 3 Months Ended | |
In Millions, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ' | ' |
Total stock-based compensation expense | $18 | $21 |
Stock option expense | ' | ' |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ' | ' |
Total stock-based compensation expense | 3 | 2 |
Restricted stock and unit awards expense | ' | ' |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ' | ' |
Total stock-based compensation expense | $15 | $19 |
Equity_Schedule_of_stock_repur
Equity (Schedule of stock repurchases) (Details) (USD $) | 3 Months Ended | 1 Months Ended | 3 Months Ended | |
In Millions, except Per Share data, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 | Dec. 31, 2013 | Mar. 31, 2014 |
2013 Repurchase Program | 2013 Repurchase Program | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' | ' |
Total number of shares purchased (in shares) | 2.2 | 7.2 | 0.1 | 0.3 |
Average price paid per share (in dollars per share) | $78.47 | $0 | ' | $78.99 |
Total cash utilized | $174 | $500 | $10 | $21 |
Equity_Narrative_Details
Equity (Narrative) (Details) (USD $) | 3 Months Ended | 0 Months Ended | 3 Months Ended | 4 Months Ended | |||
In Millions, except Share data, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2014 | Dec. 04, 2013 | Apr. 02, 2013 | Mar. 25, 2013 | Mar. 31, 2013 | Jul. 25, 2013 |
2013 Repurchase Program | 2013 Repurchase Program | Accelerated Share Repurchase Program | Accelerated Share Repurchase Program | Accelerated Share Repurchase Program | Accelerated Share Repurchase Program | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ' | ' | ' | ' | ' | ' | ' |
Stock repurchase program number of shares authorized to be repurchased (in shares) | ' | ' | 50,000,000 | ' | ' | ' | ' |
Maximum number of shares authorized for repurchase under stock repurchase plan as percentage of outstanding common stock | ' | ' | 18.00% | ' | ' | ' | ' |
Remaining shares available under repurchase program (in shares) | ' | 47,800,000 | ' | ' | ' | ' | ' |
Repurchase of additional shares (in shares) | ' | ' | ' | ' | $500 | ' | ' |
Shares received on initial delivery (in shares) | ' | ' | ' | ' | ' | 7,200,000 | ' |
Additional shares received (in shares) | ' | ' | ' | 1,400,000 | ' | ' | 700,000 |
Accelerated share repurchases, final price paid (in dollars per share) | ' | ' | ' | ' | ' | ' | $53.80 |
Accelerated share repurchases, cumulative shares repurchased (in shares) | ' | ' | ' | ' | ' | ' | 9,300,000 |
Interest in joint venture minimum percentage | 20.00% | ' | ' | ' | ' | ' | ' |
Agreement terms, change of control, put option for minority interest ownership, effective period | '15 days | ' | ' | ' | ' | ' | ' |
Equity_Schedule_of_redeemable_
Equity (Schedule of redeemable noncontrolling interest) (Details) (USD $) | 3 Months Ended |
In Millions, unless otherwise specified | Mar. 31, 2014 |
Equity [Abstract] | ' |
Balance as of December 31, 2013 | $810 |
Net income attributable to noncontrolling interest | 24 |
Distributions to noncontrolling interest | -13 |
Redemption value adjustment | -11 |
Balance as of March 31, 2014 | $810 |
Equity_Accumulated_Other_Compr
Equity (Accumulated Other Comprehensive Loss) (Details) (USD $) | 3 Months Ended | |
Mar. 31, 2014 | Mar. 31, 2013 | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | ' | ' |
Balance as of December 31, 2013 | ($196,000,000) | ' |
Other comprehensive income before reclassifications | 5,000,000 | ' |
Reclassifications from accumulated other comprehensive loss to net earnings | 1,000,000 | ' |
Net other comprehensive income | 6,000,000 | ' |
Balance as of March 31, 2014 | -190,000,000 | ' |
Pension and other postretirement benefit plans, tax | -1,000,000 | -3,000,000 |
Foreign Currency Translation Adjustment | ' | ' |
Accumulated Other Comprehensive Income (Loss) [Line Items] | ' | ' |
Balance as of December 31, 2013 | 23,000,000 | ' |
Other comprehensive income before reclassifications | 3,000,000 | ' |
Reclassifications from accumulated other comprehensive loss to net earnings | 0 | ' |
Net other comprehensive income | 3,000,000 | ' |
Balance as of March 31, 2014 | 26,000,000 | ' |
Pension and Postretirement Benefit Plans | ' | ' |
Accumulated Other Comprehensive Income (Loss) [Line Items] | ' | ' |
Balance as of December 31, 2013 | -216,000,000 | ' |
Other comprehensive income before reclassifications | 0 | ' |
Reclassifications from accumulated other comprehensive loss to net earnings | 1,000,000 | ' |
Net other comprehensive income | 1,000,000 | ' |
Balance as of March 31, 2014 | -215,000,000 | ' |
Unrealized Gain (Loss) on Forward Exchange Contracts | ' | ' |
Accumulated Other Comprehensive Income (Loss) [Line Items] | ' | ' |
Balance as of December 31, 2013 | -3,000,000 | ' |
Other comprehensive income before reclassifications | 2,000,000 | ' |
Reclassifications from accumulated other comprehensive loss to net earnings | 0 | ' |
Net other comprehensive income | 2,000,000 | ' |
Balance as of March 31, 2014 | ($1,000,000) | ' |
Earnings_Per_Share_Details
Earnings Per Share (Details) (USD $) | 3 Months Ended | |
In Millions, except Per Share data, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Amounts attributable to McGraw Hill Financial, Inc. common shareholders: | ' | ' |
Income from continuing operations | $248 | $153 |
Income from discontinued operations | 0 | 582 |
Net income | $248 | $735 |
Basic weighted-average number of common shares outstanding (in shares) | 271.8 | 280.5 |
Effect of stock options and other dilutive securities (in shares) | 5.4 | 3.8 |
Diluted weighted-average number of common shares outstanding (in shares) | 277.2 | 284.3 |
Income from continuing operations: | ' | ' |
Basic (in dollars per share) | $0.91 | $0.55 |
Diluted (in dollars per share) | $0.89 | $0.54 |
Income from discontinued operations: | ' | ' |
Basic (in dollars per share) | $0 | $2.07 |
Diluted (in dollars per share) | $0 | $2.05 |
Net income: | ' | ' |
Basic (in dollars per share) | $0.91 | $2.62 |
Diluted (in dollars per share) | $0.89 | $2.59 |
Restricted performance shares | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ' | ' |
Outstanding shares not included in the computation of diluted earnings per share (in shares) | 0.9 | 1.4 |
Stock options | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ' | ' |
Outstanding shares not included in the computation of diluted earnings per share (in shares) | ' | 3 |
Restructuring_Details
Restructuring (Details) (2013 restructuring plan, USD $) | 3 Months Ended | 12 Months Ended |
In Millions, unless otherwise specified | Mar. 31, 2014 | Dec. 31, 2013 |
Positions | ||
Restructuring Cost and Reserve [Line Items] | ' | ' |
Workforce reduction (in positions) | ' | 520 |
Restructuring charges paid | $7 | ' |
S&P Ratings | ' | ' |
Restructuring Cost and Reserve [Line Items] | ' | ' |
Initial Charge Recorded | 13 | ' |
Ending Reserve Balance | 12 | ' |
S&P Capital IQ | ' | ' |
Restructuring Cost and Reserve [Line Items] | ' | ' |
Initial Charge Recorded | 10 | ' |
Ending Reserve Balance | 7 | ' |
C&C | ' | ' |
Restructuring Cost and Reserve [Line Items] | ' | ' |
Initial Charge Recorded | 10 | ' |
Ending Reserve Balance | 5 | ' |
Corporate | ' | ' |
Restructuring Cost and Reserve [Line Items] | ' | ' |
Initial Charge Recorded | 16 | ' |
Ending Reserve Balance | 8 | ' |
Total | ' | ' |
Restructuring Cost and Reserve [Line Items] | ' | ' |
Initial Charge Recorded | 49 | ' |
Ending Reserve Balance | $32 | 39 |
Segment_and_Related_Informatio2
Segment and Related Information (Details) (USD $) | 3 Months Ended | |
In Millions, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Segment | ||
Segment Reporting Information [Line Items] | ' | ' |
Number of reportable segments (in segments) | 4 | ' |
Revenue | $1,236 | $1,181 |
Operating Profit | 430 | 278 |
S&P Ratings | ' | ' |
Segment Reporting Information [Line Items] | ' | ' |
Revenue | 569 | 561 |
Operating Profit | 240 | 249 |
S&P Capital IQ | ' | ' |
Segment Reporting Information [Line Items] | ' | ' |
Revenue | 301 | 288 |
Operating Profit | 53 | 50 |
S&P DJ Indices | ' | ' |
Segment Reporting Information [Line Items] | ' | ' |
Revenue | 137 | 115 |
Operating Profit | 91 | 64 |
C&C | ' | ' |
Segment Reporting Information [Line Items] | ' | ' |
Revenue | 251 | 236 |
Operating Profit | 76 | 60 |
Intersegment elimination | ' | ' |
Segment Reporting Information [Line Items] | ' | ' |
Revenue | -22 | -19 |
Operating Profit | 0 | 0 |
Total | ' | ' |
Segment Reporting Information [Line Items] | ' | ' |
Revenue | 1,236 | 1,181 |
Operating Profit | 460 | 423 |
Unallocated expense | ' | ' |
Segment Reporting Information [Line Items] | ' | ' |
Revenue | 0 | 0 |
Operating Profit | -30 | -145 |
Growth and value plan | Unallocated expense | ' | ' |
Segment Reporting Information [Line Items] | ' | ' |
Initial Charge Recorded | ' | 44 |
Pre-tax legal settlements | Unallocated expense | ' | ' |
Segment Reporting Information [Line Items] | ' | ' |
Initial Charge Recorded | ' | $77 |
Commitments_and_Contingencies_
Commitments and Contingencies (Details) (USD $) | 3 Months Ended | ||
In Millions, unless otherwise specified | Mar. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2003 |
Commitments and Contingencies Disclosure [Abstract] | ' | ' | ' |
Equity method investment ownership percentage | ' | ' | 45.00% |
Deferred gain | $39 | $60 | ' |
Amortized deferred gain | 6 | ' | ' |
Interest expense | 1 | ' | ' |
S&P DJ Indices | CME Group | ' | ' | ' |
Related Party Transaction [Line Items] | ' | ' | ' |
Revenues earned under license agreement | $12 | ' | ' |
Noncontrolling interest ownership by noncontrolling owners | 27.00% | ' | ' |