Moody's (MCO) 9 Feb 182017 Q4 Earnings call transcript

Company Profile

Participants

Stephen Maire	Moody's Corp.
Raymond W. McDaniel, Jr.	Moody's Corp.
Linda S. Huber	Moody's Corp.
Robert Fauber	Moody's Corp.
Mark E. Almeida	Moody's Corp
Toni M. Kaplan	Morgan Stanley & Co. LLC
Peter P. Appert	Piper Jaffray & Co.
Anjaneya K. Singh	Credit Suisse Securities (NYSE:USA) LLC
Manav Patnaik	Barclays Capital, Inc.
Jeffrey Marc Silber	BMO Capital Markets (United States)
Craig Anthony Huber	Huber Research Partners LLC
Joseph Foresi	Cantor Fitzgerald Securities
Timothy J. McHugh	William Blair & Co. LLC
Alex Kramm	UBS Securities LLC
Vincent Hung	Autonomous Research US LP
Conor Fitzgerald	Goldman Sachs & Co. LLC
Shlomo H. Rosenbaum	Stifel, Nicolaus & Co., Inc.
William A. Warmington	Wells Fargo Securities LLC

Call transcript

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Operator

Good day, and welcome ladies and gentlemen to the Moody's Corporation Fourth Quarter and Full Year 2017 Conference Call. At this time, I'd like to inform you that this conference is being recorded and that all participants are in a listen-only mode. At the request of the company, we will open the conference up for question-and-answers following the presentation. I would now like to turn the conference over to Mr. Steve Maire, Global Head of Investor Relations and Communications. ahead. go Please

Stephen Maire

full-year morning, XXXX. website morning, The will to this President Good our XXXX, Chief Moody's Huber, Full thanks joining the year Relations and outlook this for XXXX press Global Ray quarter Steve outlook release Thank are Also of presentation fourth released President full current Vice Head to Executive everyone lead Executive for Moody's well a its discuss as earnings on Investor accompany call. for call conference morning our as teleconference as Communications. and both year I Moody's making and the is Officer. us as Officer, McDaniel, am results, morning's Chief Financial and Maire, This and you. and well and XXXX. available at prepared Moody's Linda Fourth full Year teleconference for Quarter this the this remarks on our ir.moodys.com. on results

this adjusted this nearest figures. presenting and earnings To non-GAAP to release filed call, morning. or that GAAP our the GAAP figures was equivalent be view we During please reconciliations, refer will

be on to the on the year website together on in and the important factors SEC the such XXXX. the to statements. of may point begin, Reform and Commission's the your call call we the and Securities which actual on the of mode. are with to be discussed Form XX, also These, Discussion that Act your differ a the Harbor Management's accordance December statements in for members In attention other section available I which in ended media out XX-K of forth Report company, Risk also of and website. and set cause Act, Analysis could Private Annual filings within Safe Safe that Securities forward-looking our any morning Exchange our I Litigation contain from Factors toward the direct made in to attention Before listen-only contained language, would may Harbor can earnings materially the statements, I with forward-looking by release. results those like XXXX remarks found end this the Today's our the meaning

I'll turn the I to call to like on it remind end over of that Day additional York like the the to hosting over will Investor this everyone an if Before team be February I'd turn Ray, Relations you'd New event. Please information now XX at contact Ray month McDaniel. City. this in Moody's Investor about

Raymond W. McDaniel, Jr.

remarks, comments for fourth the with Moody's on In then of Steve. you, Financial you Full everyone and Thank prepared highlights Good with conclude the our of summarizing additional XXXX. Moody's from Linda Fourth record and be our fourth will XXXX morning I'll quarter, call. happy After and and to we'll $X.X financial for by begin settlement quarter to attorneys Results. and million Dijk respond operating follow Quarter thank increased with $XXX fourth the of the of of XXXX. fourth quarter Justice XX outlook primarily XX% questions. from quarter Columbia. in related States $XXX totaled XXXX today's and billion the U.S. organic XXXX, included the quarter joining Moody's of the charge of issuance, expenses an details I'll Year expenses revenue result van increase down an of Operating Operating District strong billion of fourth a the Bureau as Analytics. rated XXXX of $X.X general million, Department for from quarter in and acquisition performance in U.S. the your a fourth to

acquired $XXX intangible van loss XXXX from up Adjusted Charge, operating expenses Bureau income of Dijk percentage prior non-recurring the amortization points quarter up Expenses. and year XX%. the from period, Excluding including operating assets attributable XX was of Acquisition-Related fourth million. to million, million were this income Settlement was operating $XXX XX% operating Operating up $XXX expenses, of

laws operating was margin impacted was translation XX.X% in was loss the X%. by adjusted adjusted currency the diluted the a U.S. operating Europe. related of and Adjusted operating in $X.XX $X.XX, XXXX. net the in and $X.XX share, for the impact charge was XX% margin up income excluded and fourth The XX.X%. of for share EPS to EPS favorably per onetime from quarter diluted of $X.XX per quarter changes a up Foreign quarter tax Moody's the

and intangible amortization adjustments Additional assets acquired included Acquisition-Related Expenses. of

revenue Turning non-U.S. performance, was while revenue billion, up U.S. up billion, of billion revenue from $X.X XXXX. XX% full for XXXX $X.X year the XX%, was up record XX%. Moody's to full-year of $X.X was

XXXX million of year, from Organic up $X.X favorably was of currency included Investors Moody's billion non-U.S. Moody's up U.S. the while was was from Revenue XX% in prior XX% year. at from increase full-year the U.S. revenue X%. Foreign $XXX Operating XXXX which $XXX Charge. translation was MA, was $X.X up up Moody's X% the of XX%. the by million Settlement over billion impacted $X.X at fourth revenue Analytics billion, Analytics, XX%. up totaled $X.X billion, down Moody's $X up Revenue revenue billion, the billion, expenses quarter Service X%, XX% prior year. prior while revenue XX%, $X.X non-U.S. $X.X prior year. a was for revenue revenue was billion,

assets includes There Charge restructuring operating attributable Bureau Acquisition-Related points expenses charge acquired expenses, XX%, the were was was amortization in non-recurring income which to XXXX, in van XX%. and Dijk translation. quarter Charge. Settlement million operating included which up income XXXX Excluding a $X.X X Expenses. from XXXX, percentage intangible Settlement and no of Operating Adjusted currency the $XXX on up was billion operating fourth foreign up material billion, $X of expenses impact

in tax full charge was full-year up XXXX XX.X% prior favorably included impacted to related by XX%, for the was operating XX.X% the the tax was and XXXX, XX.X%, effective translation Charge. The the and Moody's which of margin X%. the in margin included from was in from effective of XX.X% net up currency income reform operating U.S. year operating Foreign adjusted quarter from year. the down adjusted Settlement XX.X%, fourth tax non-deductible which portion Europe. The impacts rate rate

effective was XXXX, net Excluding XX.X%. in the tax the rate charge

our adjusted Excluding to ranges further and provide benefit outlook diluted updates. Charge revenue of EPS results in and other an to to over approximate rate diluted the double-digit reform. turn the expecting call on growth We're percent U.S. another $X.XX to XXXX, the for Settlement effective XXXX of tax our year tax $X.XX. include Both low $X.XX now from growth, solid of I Linda $X.XX was will and $X.XX EPS financial XX.X%. in commentary is

Linda S. Huber

Thanks, Ray. revenue I'll at the company level. begin with

revenue was represented total quarter billion, XX%. up Moody's revenue. up represented fourth record U.S. As and of for the million revenue up total Ray and of was XX% of XX% revenue $XXX revenue $XXX non-U.S. total $X.X revenue. XX% XX%; mentioned, a XX% up million was million Moody's Recurring was $XXX of of

was Foreign at businesses revenue X%. of revenue U.S. Non-U.S. revenue consecutive XX% represented MIS favorably up Moody's up of revenue starting $XXX this and record our quarter total for currency quarter XX% million impacted XX%. the of Total MIS. Investors $XXX XX% to revenue. was increased million, now $XXX was million. translation MIS Service, revenue for by Moody's And fourth each with the looking of

corporate looking X%. MIS; revenue of the revenue was business Foreign strong currency This first, now up XX%. grade EMEA grade finance $XXX the And at the U.S. respectively. fourth translation speculative investment activity corporate grade speculative revenues finance impacted favorably XX% for MIS investment quarter lines Asian and by reflected million, bonds, and up and issuance for non-U.S. and result bonds U.S. grade were bank loans in and XX% bonds.

primarily by and up both $XXX the increase U.S. transactions. strong contributions finance up and million, structured non-U.S. rated revenue revenues Second, U.S. as XX% in X% from well finance driven REIT in U.S. as XX%, structured and respectively. totaled Europe, were an CLOs

XX% revenue and respectively. were financial result Fourth, and was increase quarter the driven anticipated XX% up million strength million $XXX $XXX represented in were MA finance. tax XX%. U.S. and legislation revenues infrastructure U.S. now revenue was was result increased MA infrastructure issuance banking from fourth up an $XXX as issuance borrowers and Organic revenue XX% and up total well XXXX of XX% and the up of from as as million fourth respectively. financial revenue Third, This $XXX by MA revenue U.S. of of million to This from institutions finance municipal was issuers. $XXX up changes revenue institutions project for XXXX. up million, And public largely XX% finance infrequent for was turning public U.S. XX% non-U.S. was in revenue accelerated U.S. and XX%. of public non-U.S. project revenue. XX% of of was Analytics, Non-U.S. ahead of XX%. of quarter $XXX finance infrastructure up total XX%. million up Moody's reflected financings

Foreign impacted business now revenue currency lines moving MA. And translation of by to for favorably the X%. MA

First, Dijk's revenue quarter RD&A research, in of lines. million, reduction from than million acquisition the U.S. for a fourth driven revenue Organic revenue non-U.S. was $XXX quarter was and strength XX%. data $XXX or more of adjustment RD&A the accounting a broad required XXXX, up rules. and $XX result $XX deferred van XX% as revenue a of revenue analytics product up Bureau million fourth of up included under million RD&A was by RD&A all XX% revenue doubled. contribution

Financial risk Second, for well up the as year enable for U.S. International primarily or X%. was increased ERS IFRS Trailing the enterprise ERS from up solutions adoption by the XX% prior period, products strong million or ERS XX-month sales that of driven non-U.S. $XXX was demand insurance product of X in Standard while Reporting was performance revenue as requirement, down accounting revenue X%, XX%. line. revenue

to to product And XX% XXXX, Charge. quarter up and fourth to of margin XX%. non-U.S. XX-month the down now XX% XXXX. expenses included expenses operating X%. the U.S. billion the totaled up the Settlement from Moody's trailing down up progress $XX the in up Recurring X% represented from revenues the shifting quarter were $XXX $X.X prior services quarter revenue And turning professional sales XXXX ERS revenue Operating total make ERS continue expenses, million was in million operating fourth on products, the and of revenue business professional $XXX services mix million, emphasize in fourth year. services X% sales in of respectively. of with of and third, XX% We higher

to and expenses merit performance-based XX% hiring, incentive XX prior-year compensation the growth and as compensation. for Excluding expense attributable non-recurring from Expenses. drivers acquired operating percentage points, includes assets Acquisition-Related period, expenses, Other the additional Settlement which increased operating included increases Charge, as intangible up Bureau of van Dijk were well of expense amortization

operating margin unfavorably mentioned, expenses XX.X%. I'll Moody's Foreign currency margin allocation. as capital XX.X% And operating adjusted now, translation was on Ray update impacted X%. And and an operating was provide by

XX, During close per the cost stockholders declared its the the approximately share XXXX January a during XXXX. the XX, of dividend million payable Moody's XXXX, share. quarterly common of per average employee of a at Moody's to cost dividend a XX% quarterly $X.XX directors of XX, shareholders of shares total be at an And board its returned $X.XX record fourth March business on February This dividend to Moody's payments prior part is XXX,XXX of of plans. fourth $XX dividend XXXX. $XXX.XX also stock-based per quarter regular as share. on will issued or quarter increase repurchased Moody's which of XXX,XXX of from via the on compensation shares stock, $XX of of million

December repurchased the stock-based part and total as issued a or of of a XXXX, million full-year payroll dividend million The cost $XXX X.X million also shares via withheld year totaled Outstanding ago. million, flat net for returned employee net million during shareholders compensation per $XXX.XX of cost XX, includes XXXX. amount X.X shares Moody's as to average shares plans. shares of $XXX share its a payments at to approximately $XXX For its employee XXXX taxes. an Moody's

call $X.X billion flow was $XXX and borrowing $XXX repurchase in Total approximately $X And cash Bureau billion from flow van authority the XXXX, Cash $XXX share down in billion, at due cash revolving billion acquisition in facility. at of flow outstanding operations capacity due equivalents year-end, Charge to quarter $X.X declines of As had down remaining. $X.X Moody's Moody's I'll XXXX, Ray. cash million, Free of million investments XXXX XXXX. credit to from the These over $XXX December of were XX, billion million from the XXXX XX, in down of in its XXXX. had available turn XXXX. was back to Settlement And the primarily that, from with and million, end were payment Dijk. under short-term cash, additional debt December $X.X

Raymond W. McDaniel, Jr.

Okay. Thanks, Linda.

for like activities. our progress to our full-year XXXX, van integration on Dijk highlights and synergy discussing with guidance provide Before I'd some Bureau

we're well collaboration San making at Our remain cross-sell additional Asia various August, are productivity integration combined set that to van offices we integration Francisco Dijk we perform announced the efforts Moody's confident van Bureau are and acquisition pleased in and South very Dijk's measures efforts. acquisition. in are the Hong on we in track as communicated staff XXXX. targets Kong, with launched York, synergy when achieving and van have Bureau van from and products co-located the with Dijk's and initiated to Europe, our pursue offices, business New Since content six and Bureau Bureau to In sourced with progress enhance products to enhanced we programs sales America about now continues we Dijk efficiency. we Moody's, the be and closing

So interest many year for spending, corporate conditions factors, press prepared mergers XXXX rates, in and based full-year earnings on current could by and of Moody's the assumptions and fourth results to can These Investor and market the including Table Relations which website I'll discussing conclude from uncertainty XX outlook amount business release, and Moody's our full is quarter securitization borrowing year XXXX at issued. acquisitions, currency our for the guidance complete this are for found of be on and is consumer differ XXXX. our assumptions rates, geopolitical exchange about guidance included debt profitability subject and Moody's ir.moodys.com. comments outlook. list materially capital of macroeconomic morning's and investment A foreign

foreign at translation exchange assumes of guidance Our January rates as XXXX. currency XX,

exchange and $X.XX to Specifically, the the rates to forecast of pound pound for euro. British the of our euro reflects for $X.XX the

approximately resulting tax is Adjusted the XX% be the full-year The cash Depreciation expects EPS from share market be revenue $X.X $X.XX. projecting is approximately $X.XX billion. expected range. be $XXX to increase to an Moody's expected $X.XX. operating U.S. is be be to to to $X.XX is and $X.XX rate XX%. to of company conditions earlier, to expenditures expected XX%. ranges expected cash, XXXX increase Both XX%. to amortization million, tax low-double-digit reform. The subject approximate to noted decisions. Free diluted XXXX expense also percent to I approximately Adjusted to Operating be in capital expects million. As to be Capital other repurchases are Full-year range. include in approximately expected expected XX% low-double-digit EPS expenses an margin allocation flow to benefit, operating expected be diluted available to are and approximately margin is is $XXX $XXX to is million. expected effective percent Moody's

to revenue and the Structured is percent percent is range. is in and expected Public, increase finance expected percent to finance percent is increase finance the revenue MIS, are range. U.S. low-single-digit increase to high-single-digit to range. in range. the revenue For range in low-single-digit Corporate percent is XXXX decrease revenue range. revenue revenues each percent expected mid-single-digit increase non-U.S. mid-single-digit in financial to the increase in high-single-digit institutions in expected expected the and project to expected infrastructure the

low-double-digit is high-single-digit as increase in approximately to full-year to expected Organic of the MA range by Analytics, acquisition is the and revenue contribution revenue mid-teens a expected the RD&A percent to deferred van result to the reduced Dijk is mid-XXs is revenue to increase Bureau expected XX%. to of mid-XXs is an range. expected increase expected expected expected non-U.S. range. range. revenue as part the is XXXX is will increase in in revenue range. is XXXX percent and ERS percent U.S. estimated percent in revenue range. range required in accounting. Moody's expected a revenue RD&A For adjustment $XX million percent percent professional increase low-double-digit from low-single-digit the be to to in increase percent revenue service in increase revenue the The increase the Organic revenue

call would to Q&A, Linda. to the just about Before turning talk a minute for I over like

month, right confident As wish of remain Financial Linda and the years assist We're team on service on be next for grateful transition President know, than running. search. for this to leaving hit and period also have the comprehensive We're all Executive to to Chief of announced be career. I'm looking We're at more a begun search We'll and her company firm with last every both outstanding Vice we focused take that and and she the her will that XX and has will her service a as you after us to Linda's ground agreed Officer. finding at our the success person a engaged the built, in Moody's now phase Linda role candidates have strong has the external internal be process. able in I successor grateful

on joining Linda's questions our growth President Linda's have. which Service. and you President an financial Linda to corporate during concludes prepared any question-and-answer for no Almeida, departure have take course, Of delivered effect strategy Moody's And This or our remarks. are of may and Analytics; We'll Mark has me tenure. be period of Moody's Rob session for unprecedented Investors Fauber, pleased of the Moody's priorities,

Operator

with Thank you. our ahead. comes from Please go Morgan first And Stanley. question Toni Kaplan

Toni M. Kaplan

morning. good Hi,

is grew MIS XX% guidance Your segment and the year mid-single-digit non-U.S. looks part. in it growth really strong like after a for calls where the

in Thanks. far for could geographies it's really and you comp the toughest this on seeing what products the also year? some so that XXXX in So driving and high-single-digit non-U.S. XQ, in just are just growth given color just give which you're us just

Raymond W. McDaniel, Jr.

consensus I views it can letting some collected the kick Linda talk comments Rob will on know we've we that by and this. Maybe have about off Sure.

Linda S. Huber

Yeah. consensus views for views banks not the of question. Toni, banks various we the these line with that I'll views the Moody's those survey they categorizations. start again, the revenue and thanks with may – from are up and exactly not

which of call the second spreads, offsetting remains tight bond for January with of XXXX, XXXX rising that the was grade trillion down And from investment issuance, January after largest is issuance January market XX% for robust rates. For include Notes the $X.XX record to is on XX%. XXXX. flat

the Fed hikes You rate total three probably a with XX% among XXXX. we note of of hike average grade in the growing an investment noticed in probability expectation M&A and March, pipeline in borrowers rate

is EBIT XXXX high relatively up and XX% is flat For headwind year-over-year issuance billion remains yield, strong yield refinancings. tax as and of potential issuance high fundamentals amounts with XXXX. the about pipeline of call sure an to and remaining low Year-to-date EBITDA narrow and robust. spreads on A high characterized include reform driven later. for that is improving and environment debt macroeconomic up $XXX XX% impact with primarily already and is Notes issuance, though new we'll demand issues, for from talk very I'm companies forward the by

some rising grade upside had third in area grade but a euro near with forward or Europe, be leveraged Europe, are earnings flat for investment are with floating in levels for shape those is a pick pipeline, Spreads comps but the slightly XXXX, high growth rate remains in M&A billion loan loan slower paper. XXXX Spreads strong are further notes to $XXX narrowed muted a to and demand expected demand to strong down if to expected Europe narrow. that markets fueling ECB yield leveraged in include tapering, about loan the start And though market strong to bit are of corporate include issuance up has down the see strong strong for XXXX, over rates are activity front, Speculative compared to lows, expected continues switching GDP create from year, QE the XXXX. opportunistic XXXX. to category record On profit. and and faced due leveraged accelerate issuance. should tough U.S., spreads and good issuance is it in as the are the post those concern is Full-year historical XX% the season. and Notes from

a that's view ask more Rob the bit the about to bank. again, So then from various I'll comment little the sectors. And

Robert Fauber

Thanks, Yeah. Linda.

Street generally So estimates Linda for provided down. corporate flattish issuance, overall U.S. to for the slightly

and broadly strong from those line issuance XXXX sector Our Toni, the in forecast all in in as you as a is really noted, regions. coming with off expect estimates we're you'd corporate very

to overall Just Linda issuance but all first of as this guidance, across which then concept are in supporting market commodity some the together, year. and market kind year. XXXX, and talked GXX, touched into obviously recent modest then outlook of the namely spreads same of we've this in in increase economies increases. the And we geopolitical our these, several a expanding disruption There decline translates synchronous take outlook see that that that at are any on the the of about rates some for revenue time XXXX. the risks, refinancing time robust and Currently, outlook kind XXXX. tying that growth into will about risks, didn't last several growing to the that we to prices, global factors influencing issuance declining we the concerns our since default issuance offset inflation to and firming really so tight think help this in market build particularly GXX decline, the have economy, of revenue. volatility activity Linda few seen accounted factors We rate M&A expect that the hasn't how activity, there are some bank then in activity in saw, maybe expected go loan obviously,

that activity, we some new ratings this then year Recurring happy in the the important point the new us and I these is which activity mandate mandate of I'm think on call. talk many the we our from some on this that revenue for the around that in now of of mix, quarters is recurring due bit monitored us about some is part you've about FX; recurring – talked increase growth about of the gets I over revenue growth you've the last at total an seen also a rating rate and are a pickup assumptions kind from in first-time our talk that standard pricing revenue, contribution couple heard of about, then there. growth large and First, favorability to to third the finally, and issuance forecast have calls, revenue, in issuers

Toni M. Kaplan

great. just and to follow-up, Linda, think question is drove wants but this what the know, And I everyone That's for your my move what plans on? are your to decision

Linda S. Huber

I the as Thanks, first This plans XXst out time transition in orderly of my this and really is it's don't world things earnings take to and call and finalized look Toni. say; at too to exciting very Moody's that have point. for some are nothing think just a other

Operator

with And Peter Piper Jaffray. go we'll next Appert to

Peter P. Appert

you you. your am I just here fill years. to for missing over I say shoes to like And Thank big sure. Linda, last would of couple great thanks already, the for all work

growth strong In looked organic terms next of growth RD&A the the business, outlook year. XX% and particularly the for

trend want be you then the you're the to my is follow-up you. is, me in clear, to the Just advance. legacy let speak RD&A The what what's better seems than Thank Two the, ex-BvD, performance one. seeing business? there? can And in business, That's driving right? this ask MA recent in margins like

Mark E. Almeida

it's Excuse me, Mark. Peter,

do van our there That the quarter, XXXX, have first, XXXX. Dijk organic van reflected talk for and in for Dijk in Dijk. have, XXXX includes about – no guidance we out, so in in organic, XXXX becomes to in In Bureau we fourth RD&A, numbers the Bureau what's will van is XXXX just Bureau Dijk about we RD&A RD&A. van be no So guidance, Bureau when in clear the the in what's and

– So that's that's working we're what definitionally, the with.

result very Just I very to in a – call some improve seeing to results our the a credit data work that we're the upon the content I'd RD&A. CreditView guess platform good our and low-double-digit which was solid in out data the growth to color we and businesses, just around research feed. underlying provide expand our of delivered good had and

and production more as in attrition our remained content existing their customer business institutions has generated solid. upgrading growth has users from New are and yield to extending strong our organizations. been very rights their Customer across usage access low customers

work in addition, points from of requirements testing modeling was basis for customer helped X were points the in and quarter RD&A of growth X So further we gained and projects, in X favorable or our IFRS one-time fourth fourth about by stress which mostly in results XXX the quarter FX.

look good capabilities, plus benefits. we in the that quarter the saw seeing drove of very And execution numbers strong our some what we of it's So had. short, of of we the with product our of strategy, XXXX That's take-up range FX are XXXX, we very into in as frankly, fourth good more the same.

strong van will Bureau which get in a Bureau addition, expect favorable also the business FX businesses, moves X.X, and new to Dijk the already We especially platform, with accommodates content cross-sell range by XXXX. of have performance in points. will contribution our content from interface provide in impact, And data, bring as which CreditView see greater full-year in that modern midyear. we market the year-on-year our CreditView as And of strong the broader the expanded better into a we momentum Dijk into all takes fourth more will of another a the good to up going good We us enable outlook to content. organic couple continued quarter. continued access category van flexibility X.X delivery we

Peter P. Appert

And legacy it. trend and about the how seeing the you're then MA there? Got margins

Mark E. Almeida

with adjusted from Yeah, Most of Analytics Moody's some well, you from saw operating in in Dijk. that is van the fourth business, quarter, Bureau expansion we points had margin. XXX of the legacy additional the contribution basis

success expansion continue we as good drive strategy margin to pursue in seeing we're rigorously MA. our to So

next Ignoring two XXXX that of van Bureau Analytics Analytics You head we end compared the at literally had year. the note with XXXX. no Moody's growth may working end addition staff, we the Moody's of of Dijk in the had people count more in

opportunities, best we're that we've deploy our So are to which the continue that good to and and resources the feel we to about pursue pursuing where strategy and we strategy them is very have against expect identified headed.

Raymond W. McDaniel, Jr.

expect. And XXXX, getting larger the Moody's Peter, in of I would because we will a van add, of what Bureau as the Dijk so primarily, look Analytics be terms business allocation increased forward with of acquisition Ray. it's of size just our just to shared in service the expense of

Mark E. Almeida

And I at into Day. think we detail will that in some Investor dive

Linda S. Huber

– also Peter, Linda. it's

aware, so accounting Just here. we're from everyone perspective Mark helping not is the

to deferred brought do, on had with BvD in bit modeling through and that will purposes. more some to for is of of so there we revenue move a just we the adjustment. We in As business, a had that guidance remain the XXXX handled XXXX, some we business,

$XX adjustment expect We Bureau of that revenue million is van Dijk there about in for deferred XXXX. left

Just have close the we're think million And quarter-by-quarter detail August QX done about the that so and in the I $XX QX, of lays with $X out million the that in we in once in you lap rest QX. XXXX. acquisition

addition as as terms Mark it's in a So nodding; well not deferred is its it case there should of in haircut revenue understood just quick be.

Peter P. Appert

Thanks. That Great. helps.

Linda S. Huber

Sure.

Operator

tax quicker Thanks. your to capital look to savings. you do any taking on allocation - to priorities like capital you next wondering tweaks (USA) Suisse. or Credit thanks you'd with allocation Suisse Anjaneya the plan a faster. Hi, could for was from as Securities the bit, Singh delever if proceeds Anj Credit questions. normal just I changes what go We'll XXXX. seems to with wondering if It we my But K. probably LLC and Singh speak

Linda S. Huber

this and one. I'll Ray let It's Sure. me Linda with help

million had billion schedule in debt of announced I strong planning business we're for our really think we to on on In of XXXX, we're capital acquisition, we added same. deleveraging remain process about after ahead operating we when we by allocation centered XXXX $XXX the are to XXXX deal. about reduce for van that Dijk the flow. and our that the going plans and that cash that think Bureau $X with took are because We priorities our debt

opportunities our be good We will have which in invest some one. job always very to business

of we it point have for offshore less spent international we the In many our acquisition. at van billion that Bureau cash, terms Dijk corporations of because than do $X.X probably cash

hundred a may to a with for but dollars of So cash Moody's, end offshore repatriate, million amount. couple we huge not up

as to for share repurchase think stick and I on million the about something you might want And may we're XXXX. to continue going to think Ray focus have Ray on had $XXX to So deleveraging. else, docket plans I of our add. mentioned,

Raymond W. McDaniel, Jr.

I deleveraging. I is – how our just It characterized No. Linda agree with priorities. has

going Suisse in are to to growth are be deleveraging. our able acquisition able to ahead same - the Singh we Securities the the Anjaneya be we compared at Okay. as to (USA) analysis on necessary K. the going investments of schedule of business. to be make time, Credit And First, LLC

margin basis, margins, XX% Okay. on year-over-year you. That's it comp follow-up, full-year to relates that revenue a strongly for help how Got growth. then despite the driven or in Thank it. up understand quarter. much just a incentive could MIS helpful. is strength for as speak down How but comes mix just shape realize by to this your for you in And segment outlook versus I it's us guide investments and these XXXX? your the

Linda S. Huber

It's full-year Linda. the margin up despite quarter. the in revenue the on operating to the note important MIS operating And that XXX basis this And XX% points, on one. start XXX basis fact, did in points. basis, decline MIS in it's margin growth I'll Sure. is by

additional fourth unusual the saddled Rob indicative. point really would expenses activity fourth in year full towards of So quarter. some some had we We you the quarter, more But in being as kind here. with we the

very know, we our had quarter, in compensation, and had incentive we profit our strong you performance-based sharing to had compensation performance XXXX. we the increase so stock fourth As in

so I think million, that MIS. was hit of over amount all a $XX total the little

we one was is or thing of bit The that million the little had $XX a businesses. than All in charge comes a severance of less to so. important little bit second non-U.S. that

I'll just him So, strong that result we previously, right-sized. one follow of up I on performance should item really the but Rob But you let and as back the to had very little see think described this. margins

Robert Fauber

to Yeah. color drive what to to a Maybe continue about just do margin. give on the we're to little going

the our to expenses we're years; over efficiency You've fashion. for seen disciplined in in results a several further last managing continuing look

think support I So just a will point I to couple that. of might things

of ebbs us reorganization completed help junior staff the year, this organization. manage That's dedicated resource up into to utilization. of our and our staffing going issuance flows just, a and more inevitable we First, a drive support our effectively through

Credit help we're across Second, tasks our and more repeatable like October low-cost that open first an head are year, In developing on in count center efficient sense, hiring Rica of is, we're through was can are got Robotic bots be the And spend Process office of looking thing bots at launched support value-added and analytical in also last Singh so our currently places. to of LLC much. ways automating year say are Costa that variety Okay, we and MIS going in India, a have a to leveraging K. we just done growth by in so I'd their right tools and it. activities. past you technology Suisse We right higher in MIS. this India. our We're half to as the part jobs about - give more Automation Anjaneya manual staff Thanks initiative analysts our these sure this make locations, time we're focused being Securities that the in workflow the people. (USA)

Operator

Manav Barclays. Patnaik We'll go next to with

Manav Patnaik

there's I was the a thank need a here. guess you. think help Yeah, it's And the bit bit around little of just you beginning in when first conservative. I guidance. I few just question usually give where guidance more areas, My a year,

to of quite sounds going with But in mandates group, mix it think maybe. areas Rob I be the think on the one similarly, the new I like and the PPIF down explained bit. group, was a U.S., at finance least it's corporate which

an you digits, here we So single maybe only there is it low mix down thought where helps international more. have would

And around just the FX, the part, sort Linda. part second of guidance was

I which rate, us you've unlike your is prior assumed spot revenue you above presume the margin tell – and benefit the spot is If the on guide that's contributions because your side, could believe. years, I

Raymond W. McDaniel, Jr.

don't Rob PPIF outlook let on the and off we Sure. Why corporate? around start

Robert Fauber

Yeah.

as the U.S. in have the we is rating tax that U.S. ,somewhere tax-exempt we in decline adversely [low-single] significantly be mind, keep of depending refundings that's has the – status advanced our between really So the loss to the public We XX% guidance. U.S. several digit in year of going XX% around for from (XX:XX:XX) impacted market. have law; public changes But and the to mid-single think finance, a which on was, significant segment a do revenue finance it. lines PPIF issuance (sic) our

Raymond W. McDaniel, Jr.

we saw And the quarter. the fourth pull that in forward

Robert Fauber

saw That's right. pull-forward We some activity.

kind to, probably think very slowdown a a all modest then pretty our to the globe outlook. year in ultimately after stable environment I around in and revenue a that infrastructure of builds issuance strong and sub-sovereign

Linda S. Huber

It's Yeah. Linda.

side, before I what to in have we interest from little move Rob, him the a because encourage expressed he's bit corporate always analysts On about speak seeing this. new in away mandates

cover So why ahead that, don't go you Rob? and

Robert Fauber

Yeah, sure. on, touch guidance also of the around And Toni's non-U.S. is to I questions that one growth. think, going around

So the about a that's quarter. XX% fourth up year-over-year mandates; first-time really good story the XXX quarter, in on

a the above mandates us new set record. for took X,XXX new year, it that So

see and the but European grew continued still a activity. the as first-time at States. strength look mandates the that We – about another growth, was the interestingly, mandates Xx had the in rate Asian And expect that strong growth slightly below mandate we at mandates United of first-time first-time for that somewhere we of first-time into into mix mandates, and in pipeline. that year that we first-time The number,

least for at is So growth part. higher contributing to that then non-U.S. revenues, of in that rate

Linda S. Huber

Manav, the have And FX, been you're point, dramatically. moving the around FX spots right. quite on

X% expect income. on X% adjusted positive We a impact revenue on FX have operating impact in and XXXX positive to

pin the purposes, pound said, euro know, the that one the about planning $X.XX. And as to dollar, a in the the in your $X.XX our €X.XX you basically doesn't the to exposures much. probably put Ray of the are for our $X.XX our that and the pound at the EPS here off in at takes all main As is euro and and EPS move thumb we euro rule pound decline it decline £X.XX with

and moving a around we're will that more little So hopefully note to that Yes, bit. a the we are you bit currencies the help euro out. do sensitive

Manav Patnaik

just then could give that typically And it. give just out. got that if growth. us if of point could have revenue quarter build you going I fourth maybe presume just that, the help I that has us Okay, MA and you the us X you more into expense price

Linda S. Huber

think expense the for is you give what me ramp year, next Let which I looking for. you're

can from and quarter $XX first get me we of a ramp give to expense saw changes and to we're we know be here very a expense so very expense know, an number just ramp, FX of million for $XX looking we're starting late-period by in minute. XXXX, For movements million impacted strong timing year, in you what compensation. as as strongly I'll The incentive somebody expenses, this

what given look $XX that through So is go million, know $XX million now. we'll the at But year. we as we

$XX million of XXXX. million to million So increasing good $XX at might quarter to a let's be $XXX for a year. first through place starting of ramp look then Maybe the we start use and number move sort as

Manav Patnaik

you. Thank right. All

Operator

we'll with Markets. Capital Silber go next Jeff to And BMO

Jeffrey Marc Silber

the going maybe reform tax back of remarks bankers in potential on again, from any your customers well? Thanks. impact noise still on anything corporate excuse interest that you there as Even side some the you hate a I tax but or reform, go me, it's side, grade are that to note much. limits market, front deductibility, so even even I to. potential prepared your I'm or I know seeing and investment hearing And expense expense, to the early. was on about think that? (XX:XX:XX) of yield we've on Thanks the I corporate high watered down about remarks, a adverse know Are but then bit, in I know little you early

Raymond W. McDaniel, Jr.

from what you heard do talk you people? to want Rob, about Yeah.

Robert Fauber

good a question. It's Yeah.

raised issuers of not with yet. least behavior, the form the think the significant impacts As not and be topic. noticeable. it's early that I very the there to at change time. this highly by And we're you where because active that to seen that's though enormous could would deployed on can that is very we're contact amount this money still that's indicated firms to imagine, view be any more of regular needs an issue, And a this I a of we're seeing very note be market is is equity speaking And private corporate terms kind that in in obviously this seeing in days that with been LBO have of remains the leveraged companies at general the

Raymond W. McDaniel, Jr.

rate will that on actual interest just have scale, say the really I'd then And company. for only at BX grade an obviously the are firms rating caps deductibility, vary and so of in individual by impact the the going that add, impact and below terms of to is bottom speculative

Jeffrey Marc Silber

follow-up. stick Okay, the that's theme to with and I'm for my tax going helpful

Thanks. tax the that you're second, terms stock-based using in that the third benefit first of In we'd quarter quarter? or for that guidance, basis inclusive XX% to rate of is is in getting XX% the comp fourth year, the be on and this number that a the normalized

Linda S. Huber

the That's quarter. in the of benefits inclusive first

bit a taken well is I heavily think may quarter. your point that weigh toward more that first little the

lighten in up we exercise So that's should would heavier options expect I'd and then majority put and bit little the in and third a it be of quarter pretty a through when first much we the I'd that. second quarter because just the

that. think these somewhere I documents had we $XX for million a number around in approximately of

can you So of said. as I had spread kind it

Jeffrey Marc Silber

Okay. Thanks very much. so helpful. Great. That's

Operator

to next Huber go Partners. Craig Research with we'll And Huber

Craig Anthony Huber

you. to you'll say, you heck of a want and just a job Thank be did I Linda, missed.

Linda S. Huber

Thanks, Craig.

Craig Anthony Huber

My whoever answer Ray to this. or first question is, like would

outlook this New this you said with know further in given loan XX% a years, are your something. I bank to down the little you of you X just bit for for the year talk banks checked On or last that? can (XX:XX), for couple some investment about Year outlook the strength

or for takes and we puts that year? bank to higher are on lower move the this what Just loans? are number What there looking

Raymond W. McDaniel, Jr.

debt have the bond volatile extent to spec rate sector. to certainly positive the is grade more attractive least from relatively that mean environment, could competition floating I a in at more that relative a interest rate Well, impact,

so are pipeline, we early good days. the activity sector, very think that, bank in loan far, but, reasonable Beyond I it's seeing

Robert Fauber

add I thing only that to the refi and an over enormous would wave had we XX Yeah, the last months. is that

pickup see to M&A, we offset will an decline some think the in we a question the extent will refinancing activity? be expected So be, as what in will that

Craig Anthony Huber

then percent versus incentive about and also rating could. ago? in missed quick then this comp what I yield have could of Okay, or was which the quarter talked a outstanding, lower And Linda, BX say in, I if high what earlier? the just your real that. also I year sneak you might just is Ray,

Linda S. Huber

Craig.

Let me start with incentive compensation.

For so may... the $XX call it was increase And last got about Ray year; million fourth around quarter $XX.X XXXX, that up so. from we XX% or $XX million; million increase,

Raymond W. McDaniel, Jr.

With Yeah. get happy we'll and a the top quote head. the BX off to call, a back be have during of number it. number respect the I on below, don't we find for to and you my If can

Robert Fauber

and of was credits thing an good though that I is it XXXX, is the all-time BX which say number at lower actually was high. one might in The bit than now below a

So have the I percent hand. that on proportion we've seen don't just absolute decline;

Linda S. Huber

Craig, I give some just you more... want to

Craig Anthony Huber

go think don't you like – sounds It ahead.

Linda S. Huber

you don't Why sorry. up I'm follow there?

Raymond W. McDaniel, Jr.

ahead Go Craig.

Craig Anthony Huber

though guys this yield your statement? think the of like deductibility from material expense – sounds was to I tax impact I don't is ask, interest you fair was just so issue business, piece going on is a just it high your a sorry, reform have to that

Raymond W. McDaniel, Jr.

a tremendously one headwind, a but is that our statement. in strong think I It's No, a fair it's opinion. not

Linda S. Huber

Craig...

Raymond W. McDaniel, Jr.

BX about and Rob grade. XX% of just below our spec And me telling XX%, is was that

Linda S. Huber

Linda. think some detail comp quarter for was million $XX.X just lumpy quarter. $XX We it's and help. million, million would $XX had then $XX million Incentive about I speak compensation I little the then went quarters very wanted and the because about XXXX. a incentive bit fourth to in Craig, the third And more

quarter. of million added fourth incentive third and the profit employees million we the to worldwide Within quarter, compensation $X sharing in $X.X for the

profit quarter. total fourth we up but to of falls a compensation that profit numbers million the third pretty for in So into good that requires order have $XX.X and some sharing, for which sharing incentive again, take effect, put

of if big we normal If move thinking down kind first really compensation of miss, incentive compensation numbers. million-ish more XXXX, incentive returns pools up. you But the as were kind the if the we Conversely, again, comes up number compensation put looking to model as hit. the this for numbers, does $XX number we're to maybe bonus next incentive year, for back take

make So just wanted to lumpiness understood you the sure there.

Craig Anthony Huber

you. Thank Understood.

Operator

We'll go Joseph with to Foresi next Cantor Fitzgerald.

Joseph Foresi

congratulations And and a on of one, luck. Hi. best Linda, good

Linda S. Huber

Thanks.

Joseph Foresi

to issuance the Just be what's about guidance. clear in

couple of increases, level from the least corporate a it? to tax and some that the interest at thinking expectations we're So built is at no rate you've way a expecting in about issuance fair change reform for of

Raymond W. McDaniel, Jr.

certainly are takes tax be puts increases are year. interest of to are the to this Yes. there's interest the expecting cash. And repatriation We rate reform. and There there Obviously, deductibility going going caps. and stronger to activity and But mergers activity, business at growth time, economic back investment this same is think business and boost support the acquisitions expansion. in possibly we that

depend and on it's the to how each So going takes puts really those balance over out against other year.

Linda S. Huber

Linda. it's Joe, And

look points in rates deck. basis our year. I investor take in increases up and with the XXX It's when at point looking, Moody's often then March went basis futures, first times you you are cite where to three at If points gone with rates that XXXX the that. XXXX, the a back up rate to more in We've XXX XXXX when look and potential to basis probability a as before an plus points. had markets investors for rates think We interest has said, though on this happened periods we'd up went important pretty have XXX I XX% XXXX than

he'd euro what had As both takes In together. to of periods, Mario up. those went it do said, the Draghi revenues hold MIS

understand positive for growth for time. very we synchronous So a is important condition that had growth as to it's said quite a very long Moody's the and haven't had Ray

equity be present market's is as compared that volatility. So to of have eye things the could we're as to the of as on. to do, for market's how we're Robert are us, helpful seemed has volatility to for something but to to course this keeping close all going be But subdued they pan a predicted bond see move the relatively and us, along said, things if very reaction very, out

you helps bit. a that hope So,

Joseph Foresi

I my sneak as then issuance MA? takeaway a I just clarification, kind of point And it. talked last Got markets Thanks. year you the positioning follow-up, with about a within BvD competitive the in, how how's of of maybe little moving of and wins as quarter? more at some one beginning could this around been has bit the think

Raymond W. McDaniel, Jr.

Rob, tackle I'd you want just to say, part. do first

Robert Fauber

expectations, line in blackout of market, Yeah, I issuance little rates everything would the but the many issuers think. say we've a indicates the issuance. I spreads steady period bit as up, seen that stride. in obviously a general, first of are general, but specifically In with pipelines normally lighter recently our that so is in – bit, that hearing I I'm bit and took bond said, the Linda look widened the this are market have that's in period, a of recent In this very to regards all, volatility. mean,

We've and would week postpone they In spreads, before deal that. were XX points, done for we've think a did and U.S., about also of more deals If some this one recently the they out seen sizable they end move about were at acquisition on those say four-year aggressive did this tights get you basis structures. two some the I seen kind market, but financing. in or the of

the have hearing taking pause Europe, this digest a may they of if general volatility. pretty in still we is of to I a think to some is constructive, least and market bit see now issuers, need. view similar a the what think, market the a financing come issuance I will think of we're opportunistic some wait to story. on that's at to What continue I And

The issuance You've bit say in market. to a And there, with market slower pretty of react loan know primary is are a strong a European loan last I'd selective, seeing markets, flow debt year was year being issuance this what to robust in hearing, the got and very market. little perhaps cash tone we're you investors that more levels. quite the volatility bit of we're constructive a they loan again, but continued the

Raymond W. McDaniel, Jr.

think because periods this, particularly on indicator but And an and pipelines will volatility it's of then want be eye be like when health did issuers to very the to market. the earlier we wait to unlike you relative of years they would go for future for would keep I important get like calm a on – XXXX, BvD? opportunistically, they become important poised the so comment pipeline's Mark,

Mark E. Almeida

being question, you to Could just make the I'm Yeah. I responsive. sure want repeat please?

Raymond W. McDaniel, Jr.

on, Joe. looks It can go ahead. like sorry, back you okay, we lost, Joe, get

Joseph Foresi

competitive takeaways now I think on had some BvD now after together you last curious what's give as update two the quarter, us an if you and and just had so happening the you go competitive you talked companies some MA I environment market that with about was share together. could in

Mark E. Almeida

already that some some Bureau and build Again, Dijk but were us execute planned plans Moody's frankly van in a making relatively there could well on had Sure. Dijk, we early together product do to still the products had still, launch development and on days with good it's in Analytics area. developed It's what had efforts. joint of that product for we're Bureau we to we some van that progress reasonably

them that And the features working build-out of so that we've we with product together had create to independently. been add and some and of planned to enhancements the complete additional

feel and the the will prospects about going positive be very that with we product we to year there. So early opportunity and market this

Joseph Foresi

you. Thank

Operator

next go we'll Company. with to & And Blair McHugh Tim William

Timothy J. McHugh

Hi.

up fourth willing, will you're rate pro about the thinking of follow guess, Bureau if kind you're of XXXX? sense you for guess Dijk – and I quarter a forward to on the on of in basis Can you van underlying – if forma Just growth what going that. kind any I into

Raymond W. McDaniel, Jr.

single-digits, flowing Yeah. historically Tim, growth Bureau XXXX sort into low XXXX, the rates. at our rates high MA kinds and half say and that's van see of and kinds those that to contribution I'd growing for the after double-digit of business sales in back is what been And has we the outlook its acquisition, of Dijk of that in at saw overall. we inherent momentum

bit or So, Moody's to the above may the rate. Analytics little see business overall we well at growth continuing be perform a

Timothy J. McHugh

impacting Okay. smaller performance guess, Great. a guidance but story, I lately? professional that know is is the there lately up ticked I good. it's And bit, and but currency improved is piece, the services, a imagine to a it's I there

Raymond W. McDaniel, Jr.

in clients our then and business those our pieces staff story, track it we've got of that the to Yeah. we're to we've couple business, and But knowledge both both India we world, business or midyear operationally out from analytical around of Tim, and our our is the research The two outsource a last where businesses platform education struggled services get training business. of bit those they starting is that attrition years. done product early and our over is XXXX, number of lines. of in of on around production up. Customer things good and a sort results turned down, XXXX to coming see Both new them of

good progress those seeing momentum we're of businesses. in both good So and

there some two we we're good generally, well. there XXXX. those seeing going the But benefit training particularly have of as right. into quite businesses, stories business, optimistic and we we're also FX from You're Both think turnaround

Linda S. Huber

it's Tim, Linda.

Just we've Earlier the years turned on done Max a that from the And get organization, nice we over – public XXXX, been that. seen we've Mark's in standards that. sales running have We in front to frankly, two quick as it companies. in I sales up to SOX U.S. organization. very results business, on for over which the someone turned the follow-up quite to for compliance

turbocharged within that interesting Moody's a really from Indian is to has public standard – Mark's very private then business journey quite companies company a safely the the with and an two team front. Indian nicely and U.S. sales Now, operating on the framework

So thank noting you and that happy for been that story a has change.

Timothy J. McHugh

you. Thank

Operator

Alex next And UBS. Kramm with we'll to go

Alex Kramm

everyone. that in I'm strong years hello that the too. past the Can go you to year high recurring to year. to that and back think around last higher mentioned when in that? this hey, FX should I've lead meat seen fees going could had we've helped beginning I or issuance revenues monitoring obviously think, the how and more Oh, single Rob, a strong in issuance, digits MIS I little up like when put lead bit

it side So is high the here thinking MIS on recurring be should we be or single digits kind of color? even what could about better? Any

Robert Fauber

an growth typically that, again, And but guide the I Yeah, we don't the revenue because growth mean of rate to seen existing we last – have recurring over yeah fee of in the issuance necessarily we're think acceleration have doesn't from recurring have going quarters. just on issuance because comes issuers. you few that it's the revenues

the future think, at revenue look So really it's issuers, first-time growth. mandates really, you really and best growth that have to I of indicator of the the is, recurring first-time

Raymond W. McDaniel, Jr.

Yeah, and little going-forward rolls and X,XXX mandates you'll monitoring in a new recall that on that into a rating basis. a forward over relationship had XXXX we

Alex Kramm

switching just here. for then And also minute you. Thank a BvD to Great.

owned that the a through renewals few few Now you've company months, guess, a for of you've gone I clients.

can related RD&A you seasonality XXXX BvD renewals to call So any just tell as modeling you or about we actually pricing would in the that, now? as you or out for think And us seen opportunities seasonality combined there then is renew? you've about

Raymond W. McDaniel, Jr.

not any business. the Yeah. – No, the let second first particular part me Well, take the seasonality or underlying there in first, Alex. is part

don't I business well. the to about need the much. that and And business then is on really generally performing think too So, think the opportunities you there,

Analytics now business. pricing. the our and to broken running with of opportunities on Dijk though in Bureau and are practices – share solid Bureau business good a and processes not – well. to But as some side we Analytics and to van Moody's it begin executive do business applying to it's have continue we substantial was and But as see the us Moody's a We van It's some the very perform we regard content between to the side, it development with. product Dijk on cross-selling for continues

real yet, other that – we development just at have at lever and we particular we're that of context on that continue the look to look So, we'll not hit that product side. candidly, the have we'll doing in the hard but work

Alex Kramm

Very you. helpful. Thank

Operator

Hung Vincent to Autonomous. go We'll next with

Vincent Hung

Hey.

Just for me. one

acceleration and phase persist, of pre-funding you maturities? expect would XXXX of late rates the high issuance XXXX maybe from an if So around

Raymond W. McDaniel, Jr.

counting business forward not the from economic XXXX our of view, of be M&A. in we're into It's to growth, on No, borrowing is business a going really for positive lot pull – expansion and XXXX. around story side the expansion, around

where even or XXXX. for forward more So than from we the that's upsides pull look XXXX

Vincent Hung

Thanks.

Operator

to next Fitzgerald Conor Goldman We'll with go Sachs.

Conor Fitzgerald

afternoon. Good

the business, much way we Just through all? at to indicate on What be potential impact be could it's maybe at one impacts its least or your meaningful will not infrastructure business whether an have bill see your on provisions key a going potentially of make you'll as potentially bill watching to a Congress. the that

Raymond W. McDaniel, Jr.

the sale mean, should it is on legislation the potential that infrastructure I we've infrastructure could increase would have Yeah. projects, actually to debt. extent business. PPIF positive bonds on And certainly seen But course allow our of coverage the how the finance structured. depends bill. final of a the to for on media of impact It that use that tax-exempt

you would have do that to anything So, positive. that? be a Rob, add on

Robert Fauber

a to mean, at actually to scheme state and been some the significant some the some in level know investment of those U.S. issuance. things I infrastructure of there's I increase and the think is it shortening been about then understand – level make want will market. about trillion, but for, are state and to on mix and versus large take timeframes I a then local impact Yeah. not look increase spending will another it and look are that few there's that of at at federal long the how overall local I into federal topic the about level. approvals, around funding over think to be have others discussion the to it an regulatory this how approvals translates And States. infrastructure the discussion $X.X have would but an there's in I obviously some United bill. we – infrastructure the the And current economy, Talking

Conor Fitzgerald

ask cash position And about in business. helpful to on then color. and That's Thanks. the wanted the leverage how just to the think

for still just into extra you've dividends Just changing for you debt and another think given debt Moody's of reform, $XXX buybacks, percentage guidance dry on cash looking at post got pay-down, around thoughts free there. billion how the feels like flow, should your $XXX income. was then for $XXX cash you powder at a down pay looking I and be your tax just million any higher CapEx $X.X And million convert then levered how of EBITDA about some million, it actual

So that about could how think wondering get to deployed. just

Linda S. Huber

Yeah, it's Linda.

as to we edge dollars be million dry we we're potential ratings your our potentially like I had a additional levels. intend which few we We things leverage observation as those on to on powder our don't said use have seeing continue level probably But if right and the things. we think another correct; of proceed any could way. of hundred now, is in at

kind and third imagine. as of and first in to it further the this, ramps $X going what with pay In million addition the would million from terms in probably quarter down got expensive add BvD then observations That additional second of and probably we're $XX an in do most and first and million you XXXX. debt interest prepay quarter, down to the $XX going then some $X let Ray is expense so throughout I'll to we've to interest fourth million

a sort leverage luck, our dry bit expand little do a how delever on of you modeling like perhaps take and of probably can it like that. better a that's bit we bit at more like that. to we'll Ray shot So But remain was consistent have to a more powder We and with or levels. had would little maybe a expected. than quickly could We bit

Raymond W. McDaniel, Jr.

certainly back and to add handle had we delever extent capital of able policy we thing how at want anticipating, that. the to what only would ahead is we go and to our previously look are we the been that I No, would

Conor Fitzgerald

That's questions. helpful. my Thank taking you for

Operator

go We'll Rosenbaum next Stifel. Shlomo to with

Shlomo H. Rosenbaum

Hi, afternoon, good in morning. squeezing thank me here. for you Thank good you or – for

able to on be the just, the to impact legislation? tax Linda, question tax would cash flow you bracket First due free

Linda S. Huber

a $X.XX Might for is we're the our helpful. Shlomo, XXXX I've EPS a this were from look able reduction to moving of Sure. be free the about We to if the tax in about in over And little got adjusted from take midpoint diluted to, rate, cash a to $XXX which increase $X.XX. interesting, guidance. million XXXX, at flow add right

each $X.XX there from from $X.XX coming from think and other have FX about we U.S. about I and what and $X.XX BvD is the that of tax business maybe reform, things.

and our our from of FX. reform rest coming So the the $X.XX $X.XX acquisition, from increase really is there and tax from business

about the terms of much that the also of how In operating margin is FX. question from got expansion, we

So, if that points look FX. XX you XX at basis is only from points, basis

the So we're that of hard doing most way.

about I to where in you that So, with thinking all going that of is helpful XXXX. we're hope

Shlomo H. Rosenbaum

change guys one old BvD. and reasons any sold a follow-up, become they of there. in BvD, about competitive business if business challenged thanks, competitive over a by private little in a environment theirs to want has more that were on And a DNB for back the Benelux just DNB great. year then? I prime the sold Okay, being as ago. competitor Was investor of and I know there a a because mean was you was they just half to they

Raymond W. McDaniel, Jr.

market Bureau and a long in has van Europe time. has Dijk a terrific position very for

we meaningful are. about where there well change We to but situation have seen is good which positioned, very say that not very, competitive feel there, not competition, that the any to feel we isn't we're we

Shlomo H. Rosenbaum

much. very you Thank great. Okay,

Operator

Wells next with to go Fargo. we'll And Bill Warmington

William A. Warmington

everyone. afternoon, Good

to congratulations run, to Linda, paths say cross phenomenal when forward So, and I again. just wanted look our

Linda S. Huber

Thanks, Bill.

William A. Warmington

I wanted a to RD&A. ask question on

You'd the the a strong talked in pickup the business. about of drivers, some research and there organic nice growth core

adjustment. deferred also mentioned points You revenue BvD also from the to and you projects, X one-time coming X highlighted

your of currency forward. and trying how growth organic the ask So in of about normalized things to terms think I'm to kind for weigh all help for those revenue I should RD&A, pieces these constant I for going want

Raymond W. McDaniel, Jr.

of Bill, which a then overall underlying Bureau think FX the kinds number the high we've addition impact Yeah I legacy up of digit I boost And the from results. there. got takes single think We've of things got that going guess us about at performing forward, the rates. We've you business got Dijk. can van

William A. Warmington

it. Got

Raymond W. McDaniel, Jr.

Is that helpful?

William A. Warmington

to organic factors, or normalized not your kind exiting once Is on that maybe XXXX, about for words of think of that to kind as mid-teens going put you're sounds in an it I low-teens, am growth to the it? it well, missing So but piece. mouth, you've you're like way the like as it be sounds like

Raymond W. McDaniel, Jr.

Bill. did not high, little I'm sure sounds That that. how you a

William A. Warmington

Okay. Maybe the Fair that. there color in last for follow-up question ERS. driving there of point. us And All my growth low- some right. then terms give on one on single-digit what's

Raymond W. McDaniel, Jr.

substantially rather was from customers really where been the intentional continuation as I to growth there it lots them. us we're and are that Yeah, manner were there and by of from that that very business. a product were business in There's where to We strategy pursuing, talking asking it. driven about for – for guess while bespoke away two doing driven install story pieces we've a moving were our a one-off configure a of we're was rather the large substantially works project we highly away that moving software

Now moving where reduce undertaking. is amount larger units we ideally a strong very sell a that kind away low more that number product from on of business services pretty that position, a of the we've basis established delivering much what to customized margin of I work subscription can we're think standard and market

growth this period the decline is product we in and So But we've a taking work from We're make have transition at a a offsetting good clip. this business, declining, where as less growing and less on intentionally. the services very that product-led business got we in business services to the profit. of is services-led business the

through As that will base situation this we growing we more then more start and be to we'll XXXX. year, stable move stabilize off as of work into that a

regulatory and over through I story which driven issues. to So very market capital of adequacy placed as the respect would the see kinds that's new heavily by I years dealing et around part part the cetera. stress and the growing part of guess don't of on and with as nearly well number idiosyncratic ERS regulation the is much liquidity of last We banks new characterize story with one was regulation testing, those That XXXX, wave were then the matured. that of story has very, that being banks

of driver regulatory the demand has dissipated. So

a the softer product environment, market with at same executing in strategy. dealing shift also time are we're the that so And we

two business. have going we growth the So is ERS that constraining on in things

Linda S. Huber

maybe of work subscription term, doing tricky, that's little volatility, is bifurcate the year, more Mark's reclassify just on XXXX a MA's results that about smooth terms Revenue move accounting accounting software it's standard, bit as you overall X% out know Also little of as should add to in bit through on we negative of have going that the of but XXX, Standard get something Linda. that, And lot we on going to near Recognition some make heard more let pretty later adopt. other Bill, we have all new that you things a in that we're licenses, set that life a it's these changes, to to technical requires software may've Hey, companies wanted to and in to things. a

more on release You'll be XX-K. we as our that seeing detail

William A. Warmington

much. Got you it. Well, very thank

Linda S. Huber

Welcome.

Operator

question Huber a have follow-up do Research with we And Partners. Craig Huber from

Craig Anthony Huber

quarter flesh would, Hi. guess, in for, Yes. mid-single-digit in revenue obviously growth year. bit, strong in the the little upcoming you're this in and growth a well you fourth just you XXXX, finance looking for segment year institutions very that this Can if I up here out as of

there year, please? growth what's decent stellar So, of top just on Thanks. on going

Raymond W. McDaniel, Jr.

if I on fourth interestingly U.S. the have U.S. Yeah, the a mean of as the inside and was large I detail in titled issuers was from part there's that Rob, the in as that. know of strength story don't outside quarter infrequent well there more the issuance you

Robert Fauber

of in it in banks, part brokerages. really companies, TLAC regimes In as cards, bail-in-able mean Yeah, Europe. capital by that's move towards this in U.S., I driven securities across of issuance part insurance continued the of the the Europe, right. building as was resolution levels

good a subsidiaries in saw of companies, some And trend. And even So where was foreign from that's of Chinese been we good full-year issuance there asset a good saw issuance ASEAN. in issuance kind from some Korea Asia, management bit banks. from we affiliate of our activity

lot markets frequently. issuance the that aren't a hitting from said, issuers Ray like come So, to tended who of

As you And XXXX. to construct. Craig, there's we move more see like to that know, guidance, in that more something expect you looks can our relationship-based would a back

Craig Anthony Huber

you. Thank

Operator

And back additional today's to time, that the Ray Mr. or I'll session. McDaniel, remarks. question-and-answer conference this turn you for concludes at closing any

Raymond W. McDaniel, Jr.

Okay.

February Just we want for with to forward you at Investor Day Thanks speaking everyone thank again. and today look call joining the on to XX.

Operator

And Full-Year Earnings this Fourth Call. XXXX and concludes Moody's Quarter

breakdown As the a section Quarter revenue the and IR the reminder, homepage. immediately MIS following this Fourth Full the call, post Moody's of Earnings company under XXXX will Year

of Eastern replay Thank you. call PM a Moody's this be Time X:XX will after website. on available Additionally, IR

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