- Consolidated revenues were
$747.5 million , up 10.1%, and up 6.3% on an organic constant currency (OCC) basis for the second quarter of 2021. - Net income attributable to
Verisk was$154.0 million , down 14.0% for the second quarter of 2021. Adjusted EBITDA, a non-GAAP measure, was$370.8 million , up 6.5%, and up 4.2% on an OCC basis. - Diluted GAAP earnings per share (diluted EPS) attributable to
Verisk were$0.94 for the second quarter of 2021, down 13.0%. Diluted adjusted earnings per share (diluted adjusted EPS), a non-GAAP measure, were$1.17 , down 9.3%. Adjusting for a$0.21 per diluted share impact from a non-cash revaluation charge related to theUnited Kingdom (“U.K.”) tax law change, diluted adjusted EPS would increase 7.0% to$1.38 (1). - Net cash provided by operating activities was
$233.2 million , down 6.5% for the second quarter of 2021. Free cash flow, a non-GAAP measure, was$170.7 million , down 11.5%. - We paid a cash dividend of
29 cents per share onJune 30, 2021 . Our Board of Directors approved a cash dividend of29 cents per share payable onSeptember 30, 2021 . - We repurchased
$150.0 million of our shares during the second quarter of 2021.
Summary of Results (GAAP and Non-GAAP)
(in millions, except per share amounts)
Note: Adjusted EBITDA, diluted adjusted EPS, and free cash flow are non-GAAP measures.
Three Months Ended | Six Months Ended | |||||||||||||||||||||||
2021 | 2020 | Change | 2021 | 2020 | Change | |||||||||||||||||||
Revenues | $ | 747.5 | $ | 678.8 | 10.1 | % | $ | 1,473.6 | $ | 1,368.6 | 7.7 | % | ||||||||||||
Net income attributable to | 154.0 | 179.0 | (14.0 | ) | 322.6 | 350.7 | (8.0 | ) | ||||||||||||||||
Adjusted EBITDA | 370.8 | 348.3 | 6.5 | 716.3 | 666.3 | 7.5 | ||||||||||||||||||
Diluted EPS attributable to | 0.94 | 1.08 | (13.0 | ) | 1.97 | 2.12 | (7.1 | ) | ||||||||||||||||
Diluted adjusted EPS | 1.17 | 1.29 | (9.3 | ) | 2.41 | 2.46 | (2.0 | ) | ||||||||||||||||
Net cash provided by operating activities | 233.2 | 249.5 | (6.5 | ) | 681.9 | 612.1 | 11.4 | |||||||||||||||||
Free cash flow | 170.7 | 192.8 | (11.5 | ) | 560.2 | 502.5 | 11.5 |
(1)
Revenues
Consolidated revenues increased 10.1%, and 6.3% on an OCC basis, for second-quarter 2021. In late
Revenues and Revenue Growth by Segment
(in millions)
Revenue Growth | ||||||||||||||||
Three Months Ended | Three Months Ended | |||||||||||||||
2021 | 2020 | Reported | OCC | |||||||||||||
Underwriting & rating | $ | 388.4 | $ | 349.3 | 11.2 | % | 7.6 | % | ||||||||
Claims | 161.6 | 142.9 | 13.2 | 8.4 | ||||||||||||
Insurance | 550.0 | 492.2 | 11.8 | 7.8 | ||||||||||||
Energy and Specialized Markets | 162.3 | 148.6 | 9.2 | 5.0 | ||||||||||||
Financial Services | 35.2 | 38.0 | (7.4 | ) | (8.1 | ) | ||||||||||
Revenues | $ | 747.5 | $ | 678.8 | 10.1 | 6.3 |
Revenue Growth | ||||||||||||||||
Six Months Ended | Six Months Ended | |||||||||||||||
2021 | 2020 | Reported | OCC | |||||||||||||
Underwriting & rating | $ | 765.5 | $ | 699.3 | 9.5 | % | 6.5 | % | ||||||||
Claims | 320.1 | 288.2 | 11.1 | 8.1 | ||||||||||||
Insurance | 1,085.6 | 987.5 | 9.9 | 6.9 | ||||||||||||
Energy and Specialized Markets | 318.5 | 302.8 | 5.2 | 2.1 | ||||||||||||
Financial Services | 69.5 | 78.3 | (11.3 | ) | (10.5 | ) | ||||||||||
Revenues | $ | 1,473.6 | $ | 1,368.6 | 7.7 | 4.9 |
Insurance segment revenues grew 11.8% in the second quarter and 7.8% on an OCC basis.
- Underwriting and rating revenues increased 11.2% in the quarter and 7.6% on an OCC basis, resulting primarily from annual increases in prices derived from continued enhancements to the content of the solutions within our industry-standard insurance programs, as well as selling expanded solutions to existing customers in commercial and personal lines. In addition, catastrophe modeling services and our international software solutions contributed to the growth.
- Claims revenues grew 13.2% in the quarter and 8.4% on an OCC basis. Growth was primarily driven by our repair cost estimating solutions revenue and our claim analytics revenue.
Energy and Specialized Markets segment revenue increased 9.2% in the quarter and 5.0% on an OCC basis. Growth was primarily driven by consulting and environmental health and safety service revenues.
Financial Services segment revenue decreased 7.4% in the quarter and 8.1% on an OCC basis, primarily due to certain contract transitions, projects that did not reoccur, and lower bankruptcy volumes. These declines more than offset solid growth in spend informed analytics revenues.
Net Income and Adjusted EBITDA
During second-quarter 2021, net income attributable to
EBITDA and Adjusted EBITDA by Segment
(in millions)
Note: Adjusted EBITDA is a non-GAAP measure. Margin is calculated as a percentage of revenues. See "Non-GAAP Reconciliations" below for a reconciliation to the nearest GAAP measure.
Three Months Ended | ||||||||||||||||||||||||||||||||||||||||
EBITDA | EBITDA Margin | Adjusted EBITDA | Adjusted EBITDA Growth | Adjusted EBITDA Margin | ||||||||||||||||||||||||||||||||||||
2021 | 2021 | |||||||||||||||||||||||||||||||||||||||
2021 | 2020 | 2021 | 2020 | 2021 | 2020 | Reported | OCC | 2021 | 2020 | |||||||||||||||||||||||||||||||
Insurance | $ | 310.7 | $ | 283.0 | 56.5 | % | 57.5 | % | $ | 310.8 | $ | 285.4 | 8.9 | % | 6.6 | % | 56.5 | % | 58.0 | % | ||||||||||||||||||||
Energy and Specialized Markets | 57.6 | 51.6 | 35.5 | 34.7 | 57.6 | 51.6 | 11.5 | 8.4 | 35.5 | 34.7 | ||||||||||||||||||||||||||||||
Financial Services | 2.4 | 11.3 | 6.9 | 29.7 | 2.4 | 11.3 | (78.6 | ) | (77.4 | ) | 6.9 | 29.7 | ||||||||||||||||||||||||||||
Consolidated | $ | 370.7 | $ | 345.9 | 49.6 | 51.0 | $ | 370.8 | $ | 348.3 | 6.5 | 4.2 | 49.6 | 51.3 |
Six Months Ended | ||||||||||||||||||||||||||||||||||||||||
EBITDA | EBITDA Margin | Adjusted EBITDA | Adjusted EBITDA Growth | Adjusted EBITDA Margin | ||||||||||||||||||||||||||||||||||||
2021 | 2021 | |||||||||||||||||||||||||||||||||||||||
2021 | 2020 | 2021 | 2020 | 2021 | 2020 | Reported | OCC | 2021 | 2020 | |||||||||||||||||||||||||||||||
Insurance | $ | 599.7 | $ | 556.2 | 55.2 | % | 56.3 | % | $ | 599.7 | $ | 542.9 | 10.5 | % | 7.4 | % | 55.2 | % | 55.0 | % | ||||||||||||||||||||
Energy and Specialized Markets | 111.3 | 101.0 | 35.0 | 33.4 | 111.3 | 101.0 | 10.2 | 7.5 | 35.0 | 33.4 | ||||||||||||||||||||||||||||||
Financial Services | 5.3 | 25.9 | 7.6 | 33.1 | 5.3 | 22.4 | (76.5 | ) | (75.6 | ) | 7.6 | 28.7 | ||||||||||||||||||||||||||||
Consolidated | $ | 716.3 | $ | 683.1 | 48.6 | 49.9 | $ | 716.3 | $ | 666.3 | 7.5 | 4.7 | 48.6 | 48.7 |
Taxes
During the second quarter of 2021, our effective tax rate was 35.6% as compared to 20.4% in the year prior. This increase was the result of an earlier than expected enactment of the
Earnings Per Share and Diluted Adjusted Earnings Per Share
Diluted EPS attributable to
Diluted adjusted EPS decreased 9.3% to
Cash Flow and Free Cash Flow
Net cash provided by operating activities was
Free cash flow represented 46.0% of adjusted EBITDA for the second quarter, compared with 55.4% in the prior-year period.
Dividend
On
On
Share Repurchases
Including the accelerated share repurchase (ASR) settled in the second quarter of 2021, we repurchased approximately 834 thousand shares at an average price of
Conference Call
Our management team will host a live audio webcast to discuss the financial results and business highlights on
A replay of the webcast will be available for 30 days on our investor website and through the conference call number 1-855-859-2056 for
About
We (Nasdaq:VRSK) provide predictive analytics and decision support solutions to customers in the insurance, energy and specialized markets, and financial services industries. More than 70 percent of the FORTUNE 100 uses our advanced technologies to manage risks, make better decisions and improve operating efficiency. Our analytic solutions address insurance underwriting and claims, fraud, regulatory compliance, natural resources, catastrophes, economic forecasting, geopolitical risks, as well as environmental, social, and governance (ESG) matters. Celebrating our 50th anniversary, we continue to make the world better, safer, and stronger, and foster an inclusive and diverse culture where all team members feel they belong. With more than 100 offices in nearly 35 countries, we consistently earn certification by
Contact:
Investor Relations
Head of Investor Relations
Verisk
201-469-4327
IR@verisk.com
Media
Head of
201-469-2618
Alberto.Canal@verisk.com
Forward-Looking Statements
This release contains forward-looking statements. These statements relate to future events or to future financial performance and involve known and unknown risks, uncertainties, and other factors that may cause our actual results, levels of activity, performance, or achievements to be materially different from any future results, levels of activity, performance, or achievements expressed or implied by these forward-looking statements. This includes, but is not limited to, our expectation and ability to pay a cash dividend on our common stock in the future, subject to the determination by our Board of Directors and based on an evaluation of our earnings, financial condition and requirements, business conditions, capital allocation determinations, and other factors, risks, and uncertainties. In some cases, you can identify forward-looking statements by the use of words such as “may,” “could,” “expect,” “intend,” “plan,” “target,” “seek,” “anticipate,” “believe,” “estimate,” “predict,” “potential,” or “continue” or the negative of these terms or other comparable terminology. You should not place undue reliance on forward-looking statements, because they involve known and unknown risks, uncertainties, and other factors that are, in some cases, beyond our control and that could materially affect actual results, levels of activity, performance, or achievements.
Other factors that could materially affect actual results, levels of activity, performance, or achievements can be found in our quarterly reports on Form 10-Q, annual reports on Form 10-K, and current reports on Form 8-K filed with the
Notes Regarding the Use of Non-GAAP Financial Measures
We have provided certain non-GAAP financial information as supplemental information regarding our operating results. These measures are not in accordance with, or an alternative for,
EBITDA, Adjusted EBITDA, and Adjusted EBITDA Expenses: EBITDA represents GAAP net income adjusted for (i) depreciation and amortization of fixed assets; (ii) amortization of intangible assets; (iii) interest expense; and (iv) provision for income taxes. Adjusted EBITDA represents EBITDA adjusted for acquisition-related costs (earn-outs), gain/loss from dispositions (which includes businesses held for sale), and nonrecurring gain/loss. Adjusted EBITDA expenses represent adjusted EBITDA net of revenues. We believe these measures are useful and meaningful because they allow for greater transparency regarding our operating performance and facilitate period-to-period comparison.
Adjusted Net Income and Diluted Adjusted EPS: Adjusted net income represents GAAP net income adjusted for (i) amortization of intangible assets, net of tax; (ii) acquisition-related costs (earn-outs), net of tax; (iii) gain/loss from dispositions (which includes businesses held for sale), net of tax; and (iv) nonrecurring gain/loss, net of tax. Diluted adjusted EPS represents adjusted net income divided by weighted-average diluted shares. We believe these measures are useful and meaningful because they allow evaluation of the after-tax profitability of our results excluding the after-tax effect of acquisition-related costs and nonrecurring items.
Free Cash Flow: Free cash flow represents net cash provided by operating activities determined in accordance with GAAP minus payments for capital expenditures. We believe free cash flow is an important measure of the recurring cash generated by our operations that may be available to repay debt obligations, repurchase our stock, invest in future growth through new business development activities, or make acquisitions.
Organic Constant Currency (OCC): Our operating results, such as, but not limited to, revenue and adjusted EBITDA, reported in
See page 10 for a reconciliation of consolidated adjusted EBITDA and a segment results summary and a reconciliation of adjusted EBITDA. See page 11 for a reconciliation of segment adjusted EBITDA margin, a reconciliation of adjusted EBITDA expenses, and a reconciliation of diluted adjusted EPS. See page 12 for a reconciliation of net cash provided by operating activities to free cash flow.
Attached Financial Statements
Please refer to the full Form 10-Q filing for the complete financial statements and related notes.
CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)
As of June 30, 2021 and
(in millions, except for share and per share data) | ||||||||
ASSETS: | ||||||||
Current assets: | ||||||||
Cash and cash equivalents | $ | 276.3 | $ | 218.8 | ||||
Accounts receivable, net of allowance for doubtful accounts of | 467.4 | 432.4 | ||||||
Prepaid expenses | 98.8 | 81.2 | ||||||
Income taxes receivable | 30.8 | 25.4 | ||||||
Other current assets | 45.4 | 36.4 | ||||||
Total current assets | 918.7 | 794.2 | ||||||
Noncurrent assets: | ||||||||
Fixed assets, net | 657.6 | 632.3 | ||||||
Operating lease right-of-use assets, net | 257.4 | 267.6 | ||||||
Intangible assets, net | 1,319.0 | 1,384.8 | ||||||
4,168.9 | 4,108.1 | |||||||
Deferred income tax assets | 9.1 | 9.1 | ||||||
Other noncurrent assets | 382.9 | 365.7 | ||||||
Total assets | $ | 7,713.6 | $ | 7,561.8 | ||||
LIABILITIES AND STOCKHOLDERS’ EQUITY: | ||||||||
Current liabilities: | ||||||||
Accounts payable and accrued liabilities | $ | 386.9 | $ | 407.3 | ||||
Short-term debt and current portion of long-term debt | 403.2 | 514.3 | ||||||
Deferred revenues | 655.3 | 466.7 | ||||||
Operating lease liabilities | 38.8 | 38.7 | ||||||
Income taxes payable | 9.7 | 3.8 | ||||||
Total current liabilities | 1,493.9 | 1,430.8 | ||||||
Noncurrent liabilities: | ||||||||
Long-term debt | 2,700.3 | 2,699.6 | ||||||
Deferred income tax liabilities | 436.2 | 396.9 | ||||||
Operating lease liabilities | 261.8 | 271.6 | ||||||
Other noncurrent liabilities | 51.2 | 64.7 | ||||||
Total liabilities | 4,943.4 | 4,863.6 | ||||||
Commitments and contingencies | ||||||||
Stockholders’ equity: | ||||||||
Common stock, | 0.1 | 0.1 | ||||||
Additional paid-in capital | 2,534.9 | 2,490.9 | ||||||
(4,423.6 | ) | (4,179.3 | ) | |||||
Retained earnings | 4,991.0 | 4,762.2 | ||||||
Accumulated other comprehensive losses | (348.9 | ) | (375.7 | ) | ||||
Total | 2,753.5 | 2,698.2 | ||||||
Noncontrolling interest | 16.7 | — | ||||||
Total stockholders’ equity | 2,770.2 | 2,698.2 | ||||||
Total liabilities and stockholders’ equity | $ | 7,713.6 | $ | 7,561.8 |
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
For the Three and Six Months Ended
Three Months Ended | Six Months Ended | |||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||
(in millions, except for share and per share data) | ||||||||||||||||
Revenues | $ | 747.5 | $ | 678.8 | $ | 1,473.6 | $ | 1,368.6 | ||||||||
Operating expenses: | ||||||||||||||||
Cost of revenues (exclusive of items shown separately below) | 264.9 | 235.8 | 527.3 | 493.5 | ||||||||||||
Selling, general and administrative | 111.4 | 96.4 | 231.2 | 208.5 | ||||||||||||
Depreciation and amortization of fixed assets | 53.3 | 45.9 | 101.8 | 92.0 | ||||||||||||
Amortization of intangible assets | 50.5 | 41.0 | 95.5 | 82.0 | ||||||||||||
Other operating income | — | — | — | (19.4 | ) | |||||||||||
Total operating expenses | 480.1 | 419.1 | 955.8 | 856.6 | ||||||||||||
Operating income | 267.4 | 259.7 | 517.8 | 512.0 | ||||||||||||
Other income (expense): | ||||||||||||||||
Investment (loss) income and others, net | (0.5 | ) | (0.7 | ) | 1.2 | (2.9 | ) | |||||||||
Interest expense | (31.5 | ) | (34.2 | ) | (66.9 | ) | (67.6 | ) | ||||||||
Total other expense, net | (32.0 | ) | (34.9 | ) | (65.7 | ) | (70.5 | ) | ||||||||
Income before income taxes | 235.4 | 224.8 | 452.1 | 441.5 | ||||||||||||
Provision for income taxes | (83.8 | ) | (45.8 | ) | (132.5 | ) | (90.8 | ) | ||||||||
Net income | 151.6 | 179.0 | 319.6 | 350.7 | ||||||||||||
Less: Net loss attributable to noncontrolling interest | 2.4 | — | 3.0 | — | ||||||||||||
Net income attributable to | $ | 154.0 | $ | 179.0 | $ | 322.6 | $ | 350.7 | ||||||||
Basic net income per share attributable to | $ | 0.95 | $ | 1.10 | $ | 1.99 | $ | 2.16 | ||||||||
Diluted net income per share attributable to | $ | 0.94 | $ | 1.08 | $ | 1.97 | $ | 2.12 | ||||||||
Weighted-average shares outstanding: | ||||||||||||||||
Basic | 162,007,784 | 162,371,920 | 162,324,802 | 162,633,113 | ||||||||||||
Diluted | 163,046,538 | 165,103,088 | 163,741,628 | 165,413,604 |
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
For the Three and Six Months Ended
Three Months Ended | Six Months Ended | |||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||
(in millions) | ||||||||||||||||
Cash flows from operating activities: | ||||||||||||||||
Net income | $ | 151.6 | $ | 179.0 | $ | 319.6 | $ | 350.7 | ||||||||
Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||||||||||
Depreciation and amortization of fixed assets | 53.3 | 45.9 | 101.8 | 92.0 | ||||||||||||
Amortization of intangible assets | 50.5 | 41.0 | 95.5 | 82.0 | ||||||||||||
Amortization of debt issuance costs and original issue discount, net of original issue premium | 0.3 | 0.5 | 0.7 | 0.8 | ||||||||||||
Provision for doubtful accounts | 5.5 | 3.9 | 8.7 | 5.4 | ||||||||||||
Gain on sale of assets | — | — | — | (19.4 | ) | |||||||||||
Stock-based compensation expense | 10.8 | 9.5 | 36.2 | 29.1 | ||||||||||||
Realized gain on available-for-sale securities, net | — | (0.5 | ) | — | — | |||||||||||
Deferred income taxes | 33.3 | (1.4 | ) | 32.6 | (1.5 | ) | ||||||||||
Loss on disposal of fixed assets, net | — | 0.1 | — | 0.4 | ||||||||||||
Changes in assets and liabilities, net of effects from acquisitions: | ||||||||||||||||
Accounts receivable | 48.5 | 66.1 | (41.0 | ) | (30.4 | ) | ||||||||||
Prepaid expenses and other assets | (18.9 | ) | (35.3 | ) | (23.1 | ) | (53.8 | ) | ||||||||
Operating lease right-of-use assets, net | 10.6 | 10.0 | 21.0 | 19.3 | ||||||||||||
Income taxes | (37.8 | ) | 25.6 | 0.6 | 66.6 | |||||||||||
Accounts payable and accrued liabilities | 5.9 | (52.9 | ) | (20.0 | ) | (114.7 | ) | |||||||||
Deferred revenues | (69.2 | ) | (52.8 | ) | 187.7 | 184.8 | ||||||||||
Operating lease liabilities | (10.4 | ) | 2.6 | (20.5 | ) | (7.9 | ) | |||||||||
Other liabilities | (0.8 | ) | 8.2 | (17.9 | ) | 8.7 | ||||||||||
Net cash provided by operating activities | 233.2 | 249.5 | 681.9 | 612.1 | ||||||||||||
Cash flows from investing activities: | ||||||||||||||||
Acquisitions and purchase of controlling interest, net of cash acquired of | (17.8 | ) | — | (31.5 | ) | — | ||||||||||
Proceeds from sale of assets | — | — | — | 23.1 | ||||||||||||
Investments in nonpublic companies | (15.1 | ) | — | (15.1 | ) | (63.8 | ) | |||||||||
Escrow funding associated with acquisitions | (4.8 | ) | — | (4.8 | ) | — | ||||||||||
Capital expenditures | (62.5 | ) | (56.7 | ) | (121.7 | ) | (109.6 | ) | ||||||||
Payment of contingent liability related to acquisitions | — | — | (1.2 | ) | — | |||||||||||
Other investing activities, net | 0.4 | (1.5 | ) | 0.8 | 4.6 | |||||||||||
Net cash used in investing activities | (99.8 | ) | (58.2 | ) | (173.5 | ) | (145.7 | ) |
Three Months Ended | Six Months Ended | |||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||
(in millions) | ||||||||||||||||
Cash flows from financing activities: | ||||||||||||||||
Proceeds (repayments) from short-term debt, net | 390.0 | (420.0 | ) | 340.0 | (495.0 | ) | ||||||||||
Repayment of current portion of long-term debt | (450.0 | ) | — | (450.0 | ) | — | ||||||||||
Proceeds from issuance of short-term debt with original maturities greater than three months | — | — | — | 20.0 | ||||||||||||
Repayments of short-term debt with original maturities greater than three months | — | (20.0 | ) | — | (20.0 | ) | ||||||||||
Proceeds from issuance of long-term debt, inclusive of original issue premium and net of original issue discount | — | 494.8 | — | 494.8 | ||||||||||||
Payment of debt issuance costs | — | (5.6 | ) | — | (5.6 | ) | ||||||||||
Repurchases of common stock | (150.0 | ) | (75.0 | ) | (250.0 | ) | (248.8 | ) | ||||||||
Proceeds from stock options exercised | 13.4 | 22.9 | 21.0 | 42.1 | ||||||||||||
Net share settlement of taxes from restricted stock and performance share awards | (3.2 | ) | (3.5 | ) | (11.0 | ) | (3.5 | ) | ||||||||
Dividends paid | (47.1 | ) | (44.0 | ) | (94.2 | ) | (87.9 | ) | ||||||||
Payment of contingent liability related to acquisitions | — | (34.2 | ) | — | (34.2 | ) | ||||||||||
Other financing activities, net | (1.8 | ) | (2.4 | ) | (3.7 | ) | (4.3 | ) | ||||||||
Net cash used in financing activities | (248.7 | ) | (87.0 | ) | (447.9 | ) | (342.4 | ) | ||||||||
Effect of exchange rate changes | 0.7 | 0.7 | (3.0 | ) | 0.5 | |||||||||||
Net (decrease) increase in cash and cash equivalents | (114.6 | ) | 105.0 | 57.5 | 124.5 | |||||||||||
Cash and cash equivalents classified within current assets held for sale, beginning of period | — | — | — | 0.3 | ||||||||||||
Cash and cash equivalents, beginning of period | 390.9 | 204.4 | 218.8 | 184.6 | ||||||||||||
Cash and cash equivalents, end of period | $ | 276.3 | $ | 309.4 | $ | 276.3 | $ | 309.4 | ||||||||
Supplemental disclosures: | ||||||||||||||||
Income taxes paid | $ | 88.1 | $ | 21.6 | $ | 98.9 | $ | 25.7 | ||||||||
Interest paid | $ | 50.2 | $ | 41.1 | $ | 69.7 | $ | 63.7 | ||||||||
Noncash investing and financing activities: | ||||||||||||||||
Debt issuance costs included in accounts payable and accrued liabilities | $ | — | $ | 0.1 | $ | — | $ | 0.1 | ||||||||
Deferred tax liability established on date of acquisition | $ | 2.2 | $ | — | $ | 4.4 | $ | — | ||||||||
Finance lease additions | $ | 0.6 | $ | 0.1 | $ | 2.6 | $ | 1.6 | ||||||||
Operating lease additions, net of terminations | $ | 2.7 | $ | 43.6 | $ | 9.4 | $ | 45.2 | ||||||||
Fixed assets included in accounts payable and accrued liabilities | $ | 1.4 | $ | 0.7 | $ | 1.4 | $ | 0.7 | ||||||||
Dividends included in accrued liabilities and other liabilities | $ | 0.4 | $ | 0.4 | $ | 0.4 | $ | 0.4 | ||||||||
Gain on sale of assets included in other current and long-term assets | $ | — | $ | — | $ | — | $ | 3.5 | ||||||||
Held for sale assets contributed to a nonpublic company | $ | — | $ | — | $ | — | $ | 65.9 |
Non-GAAP Reconciliations
Consolidated Adjusted EBITDA Reconciliation
(in millions)
Note: EBITDA, adjusted EBITDA, and organic adjusted EBITDA are non-GAAP measures. Margin is calculated as a percentage of consolidated revenues.
Three Months Ended | Six Months Ended | |||||||||||||||||||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||||||||||||||||||
Total | Margin | Total | Margin | Total | Margin | Total | Margin | |||||||||||||||||||||||||
Net income | $ | 151.6 | 20.3 | % | $ | 179.0 | 26.4 | % | $ | 319.6 | 21.7 | % | $ | 350.7 | 25.6 | % | ||||||||||||||||
Depreciation and amortization of fixed assets | 53.3 | 7.1 | 45.9 | 6.8 | 101.8 | 6.9 | 92.0 | 6.7 | ||||||||||||||||||||||||
Amortization of intangible assets | 50.5 | 6.8 | 41.0 | 6.0 | 95.5 | 6.5 | 82.0 | 6.0 | ||||||||||||||||||||||||
Interest expense | 31.5 | 4.2 | 34.2 | 5.0 | 66.9 | 4.5 | 67.6 | 5.0 | ||||||||||||||||||||||||
Provision for income taxes | 83.8 | 11.2 | 45.8 | 6.8 | 132.5 | 9.0 | 90.8 | 6.6 | ||||||||||||||||||||||||
EBITDA | 370.7 | 49.6 | 345.9 | 51.0 | 716.3 | 48.6 | 683.1 | 49.9 | ||||||||||||||||||||||||
Acquisition-related costs (earn-outs) | 0.1 | — | 2.4 | 0.3 | — | — | 2.6 | 0.2 | ||||||||||||||||||||||||
Gain from dispositions | — | — | — | — | — | — | (19.4 | ) | (1.4 | ) | ||||||||||||||||||||||
Adjusted EBITDA | 370.8 | 49.6 | 348.3 | 51.3 | 716.3 | 48.6 | 666.3 | 48.7 | ||||||||||||||||||||||||
Adjusted EBITDA from acquisitions and dispositions | (5.7 | ) | (0.8 | ) | 0.1 | — | (8.9 | ) | (0.6 | ) | 3.2 | 0.2 | ||||||||||||||||||||
Organic adjusted EBITDA | $ | 365.1 | 48.8 | $ | 348.4 | 51.3 | $ | 707.4 | 48.0 | $ | 669.5 | 48.9 |
Segment Results Summary and Adjusted EBITDA Reconciliation
(in millions)
Note: Organic revenues, EBITDA, adjusted EBITDA, and organic adjusted EBITDA are non-GAAP measures.
Three Months Ended | Three Months Ended | |||||||||||||||||||||||
Insurance | Energy and Specialized Markets | Financial Services | Insurance | Energy and Specialized Markets | Financial Services | |||||||||||||||||||
Revenues | $ | 550.0 | $ | 162.3 | $ | 35.2 | $ | 492.2 | $ | 148.6 | $ | 38.0 | ||||||||||||
Revenues from acquisitions and dispositions | (16.1 | ) | (0.4 | ) | — | — | — | — | ||||||||||||||||
Organic revenues | $ | 533.9 | $ | 161.9 | $ | 35.2 | $ | 492.2 | $ | 148.6 | $ | 38.0 | ||||||||||||
EBITDA | $ | 310.7 | $ | 57.6 | $ | 2.4 | $ | 283.0 | $ | 51.6 | $ | 11.3 | ||||||||||||
Acquisition-related costs (earn-outs) | 0.1 | — | — | 2.4 | — | — | ||||||||||||||||||
Adjusted EBITDA | 310.8 | 57.6 | 2.4 | 285.4 | 51.6 | 11.3 | ||||||||||||||||||
Adjusted EBITDA from acquisitions and dispositions | (5.8 | ) | 0.1 | — | 0.1 | — | — | |||||||||||||||||
Organic adjusted EBITDA | $ | 305.0 | $ | 57.7 | $ | 2.4 | $ | 285.5 | $ | 51.6 | $ | 11.3 |
Six Months Ended | Six Months Ended | |||||||||||||||||||||||
Insurance | Energy and Specialized Markets | Financial Services | Insurance | Energy and Specialized Markets | Financial Services | |||||||||||||||||||
Revenues | $ | 1,085.6 | $ | 318.5 | $ | 69.5 | $ | 987.5 | $ | 302.8 | $ | 78.3 | ||||||||||||
Revenues from acquisitions and dispositions | (28.5 | ) | (0.4 | ) | — | (4.1 | ) | — | (1.3 | ) | ||||||||||||||
Organic revenues | $ | 1,057.1 | $ | 318.1 | $ | 69.5 | $ | 983.4 | $ | 302.8 | $ | 77.0 | ||||||||||||
EBITDA | $ | 599.7 | $ | 111.3 | $ | 5.3 | $ | 556.2 | $ | 101.0 | $ | 25.9 | ||||||||||||
Acquisition-related costs (earn-outs) | — | — | — | 2.6 | — | — | ||||||||||||||||||
Gain from dispositions | — | — | — | (15.9 | ) | — | (3.5 | ) | ||||||||||||||||
Adjusted EBITDA | 599.7 | 111.3 | 5.3 | 542.9 | 101.0 | 22.4 | ||||||||||||||||||
Adjusted EBITDA from acquisitions and dispositions | (9.0 | ) | 0.1 | — | 3.9 | — | (0.7 | ) | ||||||||||||||||
Organic adjusted EBITDA | $ | 590.7 | $ | 111.4 | $ | 5.3 | $ | 546.8 | $ | 101.0 | $ | 21.7 |
Segment Adjusted EBITDA Margin Reconciliation
Note: Segment adjusted EBITDA margin is calculated as a percentage of respective segment revenues.
Three Months Ended | Three Months Ended | |||||||||||||||||||||||
Insurance | Energy and Specialized Markets | Financial Services | Insurance | Energy and Specialized Markets | Financial Services | |||||||||||||||||||
EBITDA margin | 56.5 | % | 35.5 | % | 6.9 | % | 57.5 | % | 34.7 | % | 29.7 | % | ||||||||||||
Acquisition-related costs (earn-outs) | — | — | — | 0.5 | — | — | ||||||||||||||||||
Adjusted EBITDA margin | 56.5 | 35.5 | 6.9 | 58.0 | 34.7 | 29.7 |
Six Months Ended | Six Months Ended | |||||||||||||||||||||||
Insurance | Energy and Specialized Markets | Financial Services | Insurance | Energy and Specialized Markets | Financial Services | |||||||||||||||||||
EBITDA margin | 55.2 | % | 35.0 | % | 7.6 | % | 56.3 | % | 33.4 | % | 33.1 | % | ||||||||||||
Acquisition-related costs (earn-outs) | — | — | — | 0.3 | — | — | ||||||||||||||||||
Gain from dispositions | — | — | — | (1.6 | ) | — | (4.4 | ) | ||||||||||||||||
Adjusted EBITDA margin | 55.2 | 35.0 | 7.6 | 55.0 | 33.4 | 28.7 |
Consolidated Adjusted EBITDA Expense Reconciliation
(in millions)
Note: Adjusted EBITDA expenses are a non-GAAP measure.
Three Months Ended | Six Months Ended | |||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||
Operating expenses | $ | 480.1 | $ | 419.1 | $ | 955.8 | $ | 856.6 | ||||||||
Depreciation and amortization of fixed assets | (53.3 | ) | (45.9 | ) | (101.8 | ) | (92.0 | ) | ||||||||
Amortization of intangible assets | (50.5 | ) | (41.0 | ) | (95.5 | ) | (82.0 | ) | ||||||||
Investment loss (income) and others, net | 0.5 | 0.7 | (1.2 | ) | 2.9 | |||||||||||
Acquisition-related costs (earn-outs) | (0.1 | ) | (2.4 | ) | — | (2.6 | ) | |||||||||
Gain from dispositions | — | — | — | 19.4 | ||||||||||||
Adjusted EBITDA expenses | $ | 376.7 | $ | 330.5 | $ | 757.3 | $ | 702.3 |
Diluted Adjusted EPS Reconciliation
(in millions, except per share amounts)
Note: Diluted adjusted EPS is a non-GAAP measure.
Three Months Ended | Six Months Ended | |||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||
Net income | $ | 151.6 | $ | 179.0 | $ | 319.6 | $ | 350.7 | ||||||||
plus: Amortization of intangibles | 50.5 | 41.0 | 95.5 | 82.0 | ||||||||||||
less: Income tax effect on amortization of intangibles | (11.1 | ) | (9.0 | ) | (21.0 | ) | (18.0 | ) | ||||||||
plus: Acquisition-related costs and interest expense (earn-outs) | 0.1 | 2.4 | — | 2.6 | ||||||||||||
less: Income tax effect on acquisition-related costs and interest expense (earn-outs) | (0.1 | ) | (0.5 | ) | — | (0.6 | ) | |||||||||
less: Gain from dispositions | — | — | — | (19.4 | ) | |||||||||||
plus: Income tax effect on gain from dispositions | — | — | — | 9.6 | ||||||||||||
Adjusted net income | $ | 191.0 | $ | 212.9 | $ | 394.1 | $ | 406.9 | ||||||||
Diluted EPS attributable to | $ | 0.94 | $ | 1.08 | $ | 1.97 | $ | 2.12 | ||||||||
Diluted adjusted EPS | $ | 1.17 | $ | 1.29 | $ | 2.41 | $ | 2.46 | ||||||||
Weighted-average diluted shares outstanding | 163.0 | 165.1 | 163.7 | 165.4 |
Free Cash Flow Reconciliation
(in millions)
Note: Free cash flow is a non-GAAP measure.
Three Months Ended | Six Months Ended | |||||||||||||||||||||||
2021 | 2020 | Change | 2021 | 2020 | Change | |||||||||||||||||||
Net cash provided by operating activities | $ | 233.2 | $ | 249.5 | (6.5 | )% | $ | 681.9 | $ | 612.1 | 11.4 | % | ||||||||||||
Capital expenditures | (62.5 | ) | (56.7 | ) | 10.2 | (121.7 | ) | (109.6 | ) | 11.0 | ||||||||||||||
Free cash flow | $ | 170.7 | $ | 192.8 | (11.5 | ) | $ | 560.2 | $ | 502.5 | 11.5 |
Source:
2021 GlobeNewswire, Inc., source