Verisk (Nasdaq: VRSK), a leading global data analytics and
technology provider, today announced results for the first quarter
ended March 31, 2024.
Lee Shavel, president and CEO, Verisk: "I am very pleased to
share that 2024 is off to a solid start at Verisk. We are
executing our growth strategy with our powerful economic model that
creates value through investment in data, new technologies, and
strategic engagement with our clients across the entire insurance
ecosystem."
Elizabeth Mann, CFO, Verisk: "During the first quarter, Verisk
delivered solid revenue and adjusted EBITDA growth resulting in
healthy margin expansion and strong double digit EPS
growth. We continue to invest our capital behind our highest
return on invested capital opportunities while returning excess
cash to shareholders. We remain confident in our ability to
deliver on our growth strategy and our margin expansion
commitments."
Summary of Results (GAAP and Non-GAAP) from Continuing
Operations(in millions, except per share amounts)Note:
Adjusted EBITDA, diluted adjusted EPS, and free cash flow are
non-GAAP measures.
|
|
Three Months Ended |
|
|
|
|
|
|
|
March 31, |
|
|
|
|
|
|
|
2024 |
|
|
2023 |
|
|
Change |
|
Revenues |
|
$ |
704 |
|
|
$ |
652 |
|
|
|
8.0 |
% |
Income from continuing
operations |
|
|
219 |
|
|
|
194 |
|
|
|
12.9 |
|
Adjusted EBITDA |
|
|
380 |
|
|
|
340 |
|
|
|
11.8 |
|
Diluted EPS attributable to
Verisk |
|
$ |
1.52 |
|
|
$ |
1.27 |
|
|
|
19.7 |
|
Diluted adjusted EPS |
|
$ |
1.63 |
|
|
$ |
1.29 |
|
|
|
26.4 |
|
Net cash provided by operating
activities |
|
|
372 |
|
|
|
365 |
|
|
|
1.9 |
|
Free cash flow |
|
|
317 |
|
|
|
304 |
|
|
|
4.2 |
|
Revenues from Continuing Operations
Consolidated and OCC revenues increased 8.0% and 6.9%,
respectively, due to strong growth in underwriting and
modest growth in claims within our Insurance segment.
Revenues and Revenue Growth by Segment(in
millions)Note: OCC revenue growth is a non-GAAP measure.
|
|
|
|
|
|
|
|
|
|
Revenue Growth |
|
|
|
Three Months Ended |
|
|
Three Months Ended |
|
|
|
March 31, |
|
|
March 31, 2024 |
|
|
|
2024 |
|
|
2023 |
|
|
Reported |
|
|
OCC |
|
Underwriting |
|
$ |
498 |
|
|
$ |
461 |
|
|
|
8.2 |
% |
|
|
7.8 |
% |
Claims |
|
|
206 |
|
|
|
191 |
|
|
|
7.6 |
|
|
|
4.7 |
|
Insurance |
|
$ |
704 |
|
|
$ |
652 |
|
|
|
8.0 |
|
|
|
6.9 |
|
Insurance segment revenues grew 8.0% in the first quarter
and 6.9% on an OCC basis.
• Underwriting revenues increased 8.2% in the quarter
and 7.8% on an OCC basis, primarily due to our forms,
rules and loss cost services, underwriting data solutions, and
extreme event solutions. In addition, life insurance and specialty
business solutions contributed to the growth and were
partially offset by continued weakness within our marketing
solutions.
• Claims revenues grew 7.6% in the quarter and 4.7% on
an OCC basis, primarily due to solid growth in
anti-fraud solutions and international solutions. Property
estimating solutions also contributed to growth.
Income and Adjusted EBITDA from Continuing
Operations
During first-quarter 2024, income from continuing
operations was $219 million, an
increase of 12.9%. The increase in income from
continuing operations was primarily due to growth in operating
income for insurance and a reduction in our effective tax rate in
the current year. Adjusted EBITDA increased
11.8%, and 10.6% on an OCC basis, primarily due to strong
revenue growth and cost discipline.
EBITDA and Adjusted EBITDA by Segment(in
millions)Note: Consolidated EBITDA and Adjusted EBITDA
are non-GAAP measures. Margin is calculated as a percentage of
revenues. See "Non-GAAP Reconciliations" below for a reconciliation
to the nearest GAAP measure. All OCC figures exclude
results from the disposition of the Energy business.
|
|
Three Months Ended March 31, |
|
|
|
EBITDA |
|
|
EBITDA Growth |
|
|
EBITDA Margin |
|
|
Adjusted EBITDA |
|
|
Adjusted EBITDA Growth |
|
|
Adjusted EBITDA Margin |
|
|
|
|
|
|
|
|
|
|
|
2024 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2024 |
|
|
2024 |
|
|
|
|
|
|
|
|
|
|
|
2024 |
|
|
2023 |
|
|
Reported |
|
|
2024 |
|
|
2023 |
|
|
2024 |
|
|
2023 |
|
|
Reported |
|
|
OCC |
|
|
2024 |
|
|
2023 |
|
Insurance |
|
$ |
380 |
|
|
$ |
355 |
|
|
|
6.9 |
% |
|
|
54.0 |
% |
|
|
54.5 |
% |
|
$ |
380 |
|
|
$ |
340 |
|
|
|
11.8 |
% |
|
|
10.6 |
% |
|
|
54.0 |
% |
|
|
52.2 |
% |
Earnings Per Share and Diluted Adjusted Earnings Per
Share
Diluted EPS attributable to Verisk increased 19.7% to
$1.52 for the first quarter of 2024. Diluted adjusted EPS
increased 26.4% to $1.63 for the first quarter of
2024, which reflects strong revenue and profit growth, a lower
effective tax rate and a lower average share count due to our
accelerated share repurchase program.
Cash Flow and Free Cash Flow
Net cash provided by operating activities was $372 million
for the first quarter of 2024, up 1.9%, and free cash
flow was $317 million, up 4.2%.
Dividend
On March 29, 2024, we paid a cash dividend of 39 cents per
share of common stock issued and outstanding to the holders of
record as of March 15, 2024.
On April 24, 2024, our Board of Directors approved a cash
dividend of 39 cents per share of common stock issued and
outstanding. The dividend is payable on June 28, 2024, to holders
of record as of June 15, 2024.
Share Repurchases
During the first quarter of 2024, we initiated a
$200 million Accelerated Share Repurchase program, which was
completed in April 2024, resulting in a repurchase of
862,332 shares, at an average price of $231.93. As of March
31, 2024, we had $1,442 million remaining under our share
repurchase authorization.
2024 Financial Guidance
The company reiterates its financial outlook for fiscal
2024 as follows:
|
|
Fiscal 2024 Guidance |
|
|
|
($ in millions, except per share amounts) |
|
|
|
Low |
|
|
High |
|
Revenue |
|
$ |
2,840 |
|
|
$ |
2,900 |
|
Adjusted EBITDA |
|
|
1,540 |
|
|
|
1,600 |
|
Adjusted EBITDA margin |
|
|
54.0 |
% |
|
|
55.0 |
% |
Diluted adjusted EPS |
|
$ |
6.30 |
|
|
$ |
6.60 |
|
|
|
|
|
|
|
|
|
|
Fixed asset depreciation &
amortization |
|
|
210 |
|
|
|
240 |
|
Intangible amortization |
|
|
75 |
|
|
|
75 |
|
Effective tax rate |
|
|
23.0 |
% |
|
|
25.0 |
% |
Capital expenditures |
|
|
240 |
|
|
|
260 |
|
Conference Call
Our management team will host a live audio webcast to discuss
the financial results and business highlights on Wednesday, May 1,
2024, at 8:30 a.m. EDT (5:30 a.m. PDT, 12:30 p.m. GMT). All
interested parties are invited to listen to the live event via
webcast on our investor website at http://investor.verisk.com.
The discussion will also be available through dial-in number
888-660-6191 for U.S./Canada participants or 929-203-1913
for international participants.
A replay of the webcast will be available for 30 days on our
investor website and through the conference call number
800-770-2030 for U.S./Canada participants or
647-362-9199 for international participants using Conference
ID #4026897.
About Verisk
Verisk is a leading strategic data analytics and technology
partner to the global insurance industry. It empowers clients to
strengthen operating efficiency, improve underwriting and claims
outcomes, combat fraud and make informed decisions about global
risks, including climate change, extreme events, ESG and political
issues. Through advanced data analytics, software, scientific
research and deep industry knowledge, Verisk helps build global
resilience for individuals, communities and businesses. With teams
across more than 20 countries, Verisk consistently earns
certification by Great Place to Work and fosters
an inclusive culture where all team members feel they
belong.
Verisk is traded on the Nasdaq exchange and is a part of the
S&P 500 Index and the Nasdaq-100 Index.
For more information, please visit www.verisk.com.
Contact:
Investor Relations Stacey
BrodbarHead of Investor
RelationsVerisk 201-469-4327 IR@verisk.com
MediaAlberto CanalVerisk Public
Relations201-469-2618Alberto.Canal@verisk.com
Forward-Looking Statements
This release contains forward-looking statements, including
those related to our financial guidance. 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 Securities and
Exchange Commission. If any of these risks or uncertainties
materialize or if our underlying assumptions prove to be incorrect,
actual results may vary significantly from what we projected. Any
forward-looking statement in this release reflects our current
views with respect to future events and is subject to these and
other risks, uncertainties, and assumptions relating to our
operations, results of operations, growth strategy, and liquidity.
We assume no obligation to publicly update or revise these
forward-looking statements for any reason, whether as a result of
new information, future events, or otherwise except as required by
law.
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,
U.S. GAAP and may be different from non-GAAP measures reported by
other companies. We believe that our presentation of
non-GAAP measures provides useful information to management and
investors regarding certain financial and business trends relating
to our financial condition and results of operations. In addition,
our management uses these measures for reviewing our financial
results, for budgeting and planning purposes, and for
evaluating the performance of senior management.
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, net; 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 help us allocate resources, make
business decisions, 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: Organic is defined as operating
results excluding the effect of recent acquisitions and
dispositions (which include businesses held for sale), and
nonrecurring gain/loss associated with cost-based and equity-method
investments that have occurred over the past year. An
acquisition is included as organic at the beginning of the calendar
quarter that occurs subsequent to the one-year anniversary of the
acquisition date. Once an acquisition is included in its
current-period organic base, its comparable prior-year-period
operating results are also included to calculate organic growth. A
disposition (which includes a business held for sale) is excluded
from organic at the beginning of the calendar quarter in which the
disposition occurs (or when a business meets the held-for-sale
criteria under U.S. GAAP). Once a disposition is excluded from
its current-period organic base, its comparable prior-year-period
operating results are also excluded to calculate organic growth. We
believe the organic presentation enables investors to assess the
growth of the business without the impact of recent acquisitions
for which there is no prior-year comparison and the impact of
recent dispositions, for which results are removed from all prior
periods presented to allow for comparability.
Organic Constant Currency (OCC) Growth Rate:
Our operating results, such as, but not limited to, revenue and
adjusted EBITDA, reported in U.S. dollars are affected by foreign
currency exchange rate fluctuations because the underlying foreign
currencies in which we transact changes in value over
time compared with the U.S. dollar. Accordingly,
we present certain constant currency financial
information to assess how we performed excluding the impact of
foreign currency exchange rate fluctuations. We
calculate constant currency by translating comparable
prior-year-period results at the currency exchange rates used in
the current period. We believe organic constant currency is a
useful and meaningful measure to enhance investors’ understanding
of the continuing operating performance of our business and to
facilitate the comparison of period-to-period performance because
it excludes the impact of foreign exchange rate movements,
acquisitions, and dispositions.
See page 10 for a reconciliation of
consolidated adjusted EBITDA and a segment results summary and
a reconciliation of adjusted EBITDA. See page
10 for a reconciliation of segment
adjusted EBITDA margin, a reconciliation of adjusted EBITDA
expenses, and a reconciliation of diluted adjusted EPS. See page
11 for a reconciliation of net cash
provided by operating activities to free cash flow.
We are not able to provide a reconciliation of projected
Adjusted EBITDA, Adjusted EBITDA margin, and Diluted Adjusted
EPS to the most directly comparable expected GAAP results
because of the unreasonable effort and high unpredictability of
estimating certain items that are excluded from non-GAAP Adjusted
EBITDA, Adjusted EBITDA margin, and Diluted Adjusted
EPS, including, for example, tax consequences,
acquisition-related costs, gain/loss from dispositions and other
non-recurring expenses, the effect of which may be significant.
Attached Financial Statements
Please refer to the full Form 10-Q filing for the complete
financial statements and related notes.
VERISK ANALYTICS,
INC.CONDENSED CONSOLIDATED BALANCE SHEETS
(UNAUDITED)As of March 31, 2024 and December
31, 2023
|
|
March 31, 2024 |
|
|
December 31, 2023 |
|
|
|
(in millions, except for share and per share
data) |
|
ASSETS: |
|
Current assets: |
|
|
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
352.4 |
|
|
$ |
302.7 |
|
Accounts receivable, net of allowance for doubtful accounts of
$15.7 and $15.1, respectively |
|
|
486.6 |
|
|
|
334.2 |
|
Prepaid expenses |
|
|
85.3 |
|
|
|
84.5 |
|
Income taxes receivable |
|
|
32.2 |
|
|
|
23.5 |
|
Other current assets |
|
|
60.5 |
|
|
|
65.2 |
|
Total current assets |
|
|
1,017.0 |
|
|
|
810.1 |
|
Noncurrent assets: |
|
|
|
|
|
|
|
|
Fixed assets, net |
|
|
612.5 |
|
|
|
604.9 |
|
Operating lease right-of-use assets, net |
|
|
187.5 |
|
|
|
191.7 |
|
Intangible assets, net |
|
|
452.1 |
|
|
|
471.7 |
|
Goodwill |
|
|
1,760.6 |
|
|
|
1,760.8 |
|
Deferred income tax assets |
|
|
30.5 |
|
|
|
30.8 |
|
Other noncurrent assets |
|
|
438.4 |
|
|
|
496.1 |
|
Total assets |
|
$ |
4,498.6 |
|
|
$ |
4,366.1 |
|
LIABILITIES AND STOCKHOLDERS’ EQUITY: |
|
Current liabilities: |
|
|
|
|
|
|
|
|
Accounts payable and accrued liabilities |
|
$ |
240.7 |
|
|
$ |
340.8 |
|
Short-term debt and current portion of long-term debt |
|
|
16.4 |
|
|
|
14.5 |
|
Deferred revenues |
|
|
635.5 |
|
|
|
375.1 |
|
Operating lease liabilities |
|
|
26.7 |
|
|
|
33.1 |
|
Income taxes payable |
|
|
10.5 |
|
|
|
7.9 |
|
Total current liabilities |
|
|
929.8 |
|
|
|
771.4 |
|
Noncurrent liabilities: |
|
|
|
|
|
|
|
|
Long-term debt |
|
|
2,860.3 |
|
|
|
2,852.2 |
|
Deferred income tax liabilities |
|
|
202.5 |
|
|
|
210.1 |
|
Operating lease liabilities |
|
|
197.1 |
|
|
|
195.6 |
|
Other noncurrent liabilities |
|
|
21.1 |
|
|
|
14.6 |
|
Total liabilities |
|
|
4,210.8 |
|
|
|
4,043.9 |
|
Commitments and contingencies
(Note 16) |
|
|
|
|
|
|
|
|
Stockholders’ equity: |
|
|
|
|
|
|
|
|
Common stock, $.001 par value; 2,000,000,000 shares authorized;
544,003,038 shares issued; 142,785,185 and 143,308,729 shares
outstanding, respectively |
|
|
0.1 |
|
|
|
0.1 |
|
Additional paid-in capital |
|
|
2,895.6 |
|
|
|
2,872.3 |
|
Treasury stock, at cost, 401,217,853 and 400,694,309 shares,
respectively |
|
|
(9,238.0 |
) |
|
|
(9,037.5 |
) |
Retained earnings |
|
|
6,580.9 |
|
|
|
6,416.9 |
|
Accumulated other comprehensive income |
|
|
43.6 |
|
|
|
58.2 |
|
Total Verisk stockholders' equity |
|
|
282.2 |
|
|
|
310.0 |
|
Noncontrolling interests |
|
|
5.6 |
|
|
|
12.2 |
|
Total stockholders’ equity |
|
|
287.8 |
|
|
|
322.2 |
|
Total liabilities and stockholders’ equity |
|
$ |
4,498.6 |
|
|
$ |
4,366.1 |
|
VERISK ANALYTICS,
INC.CONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS (UNAUDITED)For the Three Months
Ended March 31, 2024 and 2023
|
|
Three Months Ended March 31, |
|
|
|
2024 |
|
|
2023 |
|
|
|
(in millions, except for share and per share
data) |
|
Revenues |
|
$ |
704.0 |
|
|
$ |
651.6 |
|
Operating expenses: |
|
|
|
|
|
|
|
|
Cost of revenues (exclusive of items shown separately below) |
|
|
227.8 |
|
|
|
216.2 |
|
Selling, general and administrative |
|
|
92.9 |
|
|
|
79.0 |
|
Depreciation and amortization of fixed assets |
|
|
57.4 |
|
|
|
44.6 |
|
Amortization of intangible assets |
|
18.5 |
|
|
|
17.7 |
|
Total operating expenses, net |
|
|
396.6 |
|
|
|
357.5 |
|
Operating income |
|
|
307.4 |
|
|
|
294.1 |
|
Other expense: |
|
|
|
|
|
|
|
|
Investment loss |
|
|
(3.3 |
) |
|
|
(1.1 |
) |
Interest expense, net |
|
|
(28.9 |
) |
|
|
(26.4 |
) |
Total other expense, net |
|
|
(32.2 |
) |
|
|
(27.5 |
) |
Income from continuing
operations before income taxes |
|
|
275.2 |
|
|
|
266.6 |
|
Provision for income
taxes |
|
|
(55.8 |
) |
|
|
(72.2 |
) |
Income from continuing operations |
|
|
219.4 |
|
|
|
194.4 |
|
Loss from discontinued operations net of tax expense of $0.0 and
$1.1, respectively (Note 7) |
|
|
— |
|
|
|
(138.0 |
) |
Net income |
|
|
219.4 |
|
|
|
56.4 |
|
Less: Net loss (income) attributable to noncontrolling
interests |
|
|
0.2 |
|
|
|
(0.1 |
) |
Net income attributable to Verisk |
|
$ |
219.6 |
|
|
$ |
56.3 |
|
Basic net income per share
attributable to Verisk: |
|
|
|
|
|
|
|
|
Income from continuing operations |
|
$ |
1.53 |
|
|
$ |
1.28 |
|
Loss from discontinued operations |
|
|
— |
|
|
|
(0.91 |
) |
Basic net income per share attributable to Verisk: |
|
$ |
1.53 |
|
|
$ |
0.37 |
|
Diluted net income per share
attributable to Verisk: |
|
|
|
|
|
|
|
|
Income from continuing operations |
|
$ |
1.52 |
|
|
$ |
1.27 |
|
Loss from discontinued operations |
|
|
— |
|
|
|
(0.90 |
) |
Diluted net income per share attributable to Verisk: |
|
$ |
1.52 |
|
|
$ |
0.37 |
|
Weighted-average shares
outstanding: |
|
|
|
|
|
|
|
|
Basic |
|
|
143,298,163 |
|
|
|
152,032,255 |
|
Diluted |
|
|
143,973,534 |
|
|
|
152,709,319 |
|
VERISK ANALYTICS,
INC.CONDENSED CONSOLIDATED STATEMENTS OF CASH
FLOWS (UNAUDITED)For the Three Months
Ended March 31, 2024 and 2023
|
|
Three Months Ended March 31, |
|
|
|
2024 |
|
|
2023 |
|
|
|
(in millions) |
|
Cash flows from operating
activities: |
|
|
|
|
|
|
|
|
Net income |
|
$ |
219.4 |
|
|
$ |
56.4 |
|
Adjustments to reconcile net income to net cash provided by
operating activities: |
|
|
|
|
|
|
|
|
Depreciation and amortization of fixed assets |
|
|
57.4 |
|
|
|
44.6 |
|
Amortization of intangible assets |
|
18.5 |
|
|
|
17.7 |
|
Amortization of debt issuance costs and original issue discount,
net of original issue premium |
|
|
0.4 |
|
|
|
0.1 |
|
Provision for doubtful accounts |
|
|
3.4 |
|
|
|
2.6 |
|
Loss on sale of assets |
|
|
— |
|
|
|
128.4 |
|
Impairment of cost-based investments |
|
|
1.0 |
|
|
|
— |
|
Stock-based compensation expense |
|
|
13.2 |
|
|
|
23.9 |
|
Deferred income taxes |
|
|
(8.3 |
) |
|
|
(19.0 |
) |
Gain on disposal of fixed assets |
|
|
— |
|
|
|
(0.1 |
) |
Changes in assets and liabilities, net of effects from
acquisitions: |
|
|
|
|
|
|
|
|
Accounts receivable |
|
|
(155.9 |
) |
|
|
(185.4 |
) |
Prepaid expenses and other assets |
|
|
0.3 |
|
|
|
(32.9 |
) |
Operating lease right-of-use assets, net |
|
|
6.6 |
|
|
|
2.9 |
|
Income taxes |
|
|
58.0 |
|
|
|
82.2 |
|
Accounts payable and accrued liabilities |
|
|
(99.4 |
) |
|
|
(32.4 |
) |
Deferred revenues |
|
|
260.8 |
|
|
|
261.3 |
|
Operating lease liabilities |
|
|
(7.3 |
) |
|
|
(2.6 |
) |
Other liabilities |
|
|
4.1 |
|
|
|
17.6 |
|
Net cash provided by operating activities |
|
|
372.2 |
|
|
|
365.3 |
|
Cash flows from investing
activities: |
|
|
|
|
|
|
|
|
Acquisitions and purchase of additional controlling interest, net
of cash acquired of $1.8 and $1.0, respectively |
|
|
(25.9 |
) |
|
|
(37.2 |
) |
Proceeds from sale of assets |
|
|
— |
|
|
|
3,066.4 |
|
Investments in nonpublic companies |
|
|
(1.3 |
) |
|
|
(0.8 |
) |
Capital expenditures |
|
|
(55.2 |
) |
|
|
(61.2 |
) |
Escrow funding associated with acquisitions |
|
|
2.5 |
|
|
|
— |
|
Other investing activities, net |
|
|
— |
|
|
|
(0.1 |
) |
Net cash (used in) provided by investing activities |
|
|
(79.9 |
) |
|
|
2,967.1 |
|
|
|
Three Months Ended March 31, |
|
|
|
2024 |
|
|
2023 |
|
|
|
(in millions) |
|
Cash flows from financing
activities: |
|
|
|
|
|
|
|
|
Proceeds from issuance of long-term debt, net of original issue
discount |
|
|
— |
|
|
|
495.2 |
|
Payment of debt issuance costs |
|
|
— |
|
|
|
(5.5 |
) |
Repayment from short-term debt |
|
|
— |
|
|
|
(1,265.0 |
) |
Repayment of short-term debt with original maturities greater than
three months |
|
|
— |
|
|
|
(125.0 |
) |
Repurchases of common stock |
|
|
(170.0 |
) |
|
|
(2,000.0 |
) |
Share repurchases not yet settled |
|
|
(30.0 |
) |
|
|
(500.0 |
) |
Proceeds from stock options exercised |
|
28.2 |
|
|
|
58.4 |
|
Net share settlement of taxes from restricted stock and performance
share awards |
|
|
(12.1 |
) |
|
|
(12.3 |
) |
Dividends paid |
|
|
(55.8 |
) |
|
|
(49.2 |
) |
Other financing activities, net |
|
|
(2.8 |
) |
|
|
(1.6 |
) |
Net cash used in financing activities |
|
|
(242.5 |
) |
|
|
(3,405.0 |
) |
Effect of exchange rate changes |
|
|
(0.1 |
) |
|
|
11.8 |
|
Net increase (decrease) in cash and cash equivalents |
|
|
49.7 |
|
|
|
(60.8 |
) |
Cash and cash equivalents, beginning of period |
|
|
302.7 |
|
|
|
292.7 |
|
Cash and cash equivalents, end of period |
|
$ |
352.4 |
|
|
$ |
231.9 |
|
Supplemental disclosures: |
|
|
|
|
|
|
|
|
Income taxes paid |
|
$ |
6.1 |
|
|
$ |
10.0 |
|
Interest paid |
|
$ |
9.1 |
|
|
$ |
16.3 |
|
Noncash investing and
financing activities: |
|
|
|
|
|
|
|
|
Deferred tax liability established on date of acquisition |
|
$ |
1.4 |
|
|
$ |
3.1 |
|
Net assets sold as part of disposition |
|
$ |
— |
|
|
$ |
3,211.8 |
|
Finance lease additions |
|
$ |
12.4 |
|
|
$ |
6.2 |
|
Operating lease additions, net |
|
$ |
2.7 |
|
|
$ |
26.3 |
|
Fixed assets included in accounts payable and accrued
liabilities |
|
$ |
0.2 |
|
|
$ |
0.2 |
|
Non-GAAP Reconciliations
Consolidated EBITDA, Adjusted EBITDA and Organic
Adjusted EBITDA Reconciliation from Continuing
Operations(in millions)Note: EBITDA, adjusted EBITDA, and
organic adjusted EBITDA are non-GAAP measures. Margin is
calculated as a percentage of revenues.
|
|
Three Months Ended March 31, |
|
|
|
2024 |
|
|
2023 |
|
|
|
Total |
|
|
Margin |
|
|
Total |
|
|
Margin |
|
Net income |
|
$ |
219.4 |
|
|
|
31.2 |
% |
|
$ |
56.4 |
|
|
|
8.6 |
% |
Less: Loss from discontinued
operations, net of tax expense of $0.0 and $1.1, respectively |
|
|
— |
|
|
|
— |
|
|
|
138.0 |
|
|
|
21.2 |
|
Income from continuing operations |
|
|
219.4 |
|
|
|
31.2 |
|
|
|
194.4 |
|
|
|
29.8 |
|
Depreciation and amortization
of fixed assets |
|
|
57.4 |
|
|
|
8.2 |
|
|
|
44.6 |
|
|
|
6.8 |
|
Amortization of intangible
assets |
|
|
18.5 |
|
|
|
2.6 |
|
|
|
17.7 |
|
|
|
2.7 |
|
Interest expense, net |
|
|
28.9 |
|
|
|
4.1 |
|
|
|
26.4 |
|
|
|
4.1 |
|
Provision for income
taxes |
|
|
55.8 |
|
|
|
7.9 |
|
|
|
72.2 |
|
|
|
11.1 |
|
EBITDA |
|
|
380.0 |
|
|
|
54.0 |
|
|
|
355.3 |
|
|
|
54.5 |
|
Acquisition-related
adjustments (earn-outs) |
|
|
— |
|
|
|
— |
|
|
|
(15.0 |
) |
|
|
(2.3 |
) |
Impairment of cost-based
investments |
|
|
1.0 |
|
|
|
0.1 |
|
|
|
— |
|
|
|
— |
|
Nonoperational foreign
currency loss on internal loan transaction |
|
|
4.2 |
|
|
|
0.6 |
|
|
|
— |
|
|
|
— |
|
Litigation reserve, net of
recovery |
|
|
(4.7 |
) |
|
|
(0.7 |
) |
|
|
— |
|
|
|
— |
|
Adjusted EBITDA |
|
|
380.5 |
|
|
|
54.0 |
|
|
|
340.3 |
|
|
|
52.2 |
|
Less: Adjusted EBITDA from
acquisitions |
|
|
(1.2 |
) |
|
|
|
|
|
|
0.1 |
|
|
|
|
|
Organic adjusted EBITDA |
|
$ |
379.3 |
|
|
|
54.5 |
|
|
$ |
340.4 |
|
|
|
52.4 |
|
Segment Results Summary, EBITDA
and Adjusted EBITDA
Reconciliation(in millions)Note: Organic revenues, EBITDA,
adjusted EBITDA, and organic adjusted EBITDA are non-GAAP
measures.
|
|
Three Months Ended March 31, |
|
|
|
2024 |
|
|
2023 |
|
Revenues |
|
$ |
704.0 |
|
|
$ |
651.6 |
|
Less: Revenues from
acquisitions and dispositions |
|
|
(7.8 |
) |
|
|
(1.9 |
) |
Organic revenues |
|
$ |
696.2 |
|
|
$ |
649.7 |
|
|
|
|
|
|
|
|
|
|
EBITDA |
|
$ |
380.0 |
|
|
$ |
355.3 |
|
Acquisition-related
adjustments (earn-outs) |
|
|
— |
|
|
|
(15.0 |
) |
Impairment of cost-based
investments |
|
|
1.0 |
|
|
|
— |
|
Nonoperational foreign
currency loss on internal loan transaction |
|
|
4.2 |
|
|
|
— |
|
Litigation reserve, net of
recovery |
|
|
(4.7 |
) |
|
|
— |
|
Adjusted EBITDA |
|
|
380.5 |
|
|
|
340.3 |
|
Less: Adjusted EBITDA from
acquisitions |
|
|
(1.2 |
) |
|
|
0.1 |
|
Organic adjusted EBITDA |
|
$ |
379.3 |
|
|
$ |
340.4 |
|
Segment Adjusted EBITDA Margin
ReconciliationNote: Segment adjusted EBITDA margin is
calculated as a percentage of segment revenues.
|
|
Three Months Ended March 31, 2024 |
|
|
Three Months Ended March 31, 2023 |
|
EBITDA margin |
|
|
54.0 |
% |
|
|
54.5 |
% |
Acquisition-related
adjustments (earn-outs) |
|
|
— |
|
|
|
(2.3 |
) |
Nonoperational foreign
currency loss on internal loan transaction |
|
|
0.6 |
|
|
|
— |
|
Impairment of cost-based
investments |
|
|
0.1 |
|
|
|
— |
|
Litigation reserve, net of
recovery |
|
|
(0.7 |
) |
|
|
— |
|
Adjusted EBITDA margin |
|
|
54.0 |
|
|
|
52.2 |
|
Consolidated Adjusted EBITDA Expense
Reconciliation(in millions)Note: Adjusted EBITDA expenses
are a non-GAAP measure.
|
|
Three Months Ended |
|
|
|
March 31, |
|
|
|
2024 |
|
|
2023 |
|
Operating expenses |
|
$ |
396.6 |
|
|
$ |
357.5 |
|
Less: Depreciation and
amortization of fixed assets |
|
|
(57.4 |
) |
|
|
(44.6 |
) |
Less: Amortization of
intangible assets |
|
|
(18.5 |
) |
|
|
(17.7 |
) |
Plus: Investment loss |
|
|
2.3 |
|
|
|
1.1 |
|
Plus: Acquisition-related
adjustments (earn-outs) |
|
|
— |
|
|
|
15.0 |
|
Plus: Impairment of cost-based
investments |
|
|
1.0 |
|
|
|
— |
|
Plus: Nonoperational foreign
currency loss on internal loan transaction |
|
|
4.2 |
|
|
|
— |
|
Less: Litigation reserve, net
of recovery |
|
|
(4.7 |
) |
|
|
— |
|
Adjusted EBITDA expenses |
|
$ |
323.5 |
|
|
$ |
311.3 |
|
Diluted Adjusted EPS Reconciliation(in
millions, except per share amounts)Note: Diluted adjusted EPS is a
non-GAAP measure.
|
|
Three Months Ended |
|
|
|
March 31, |
|
|
|
2024 |
|
|
2023 |
|
Net income |
|
$ |
219.4 |
|
|
$ |
56.4 |
|
Less: Loss from discontinued
operations, net of tax expense of $0.0 and $1.1, respectively |
|
|
— |
|
|
|
138.0 |
|
Income from continuing operations |
|
|
219.4 |
|
|
|
194.4 |
|
Plus: Amortization of
intangibles |
|
18.5 |
|
|
|
17.7 |
|
Less: Income tax effect on
amortization of intangibles |
|
|
(4.8 |
) |
|
|
(4.5 |
) |
Less: Acquisition-related
adjustment (earn-outs) |
|
|
— |
|
|
|
(15.0 |
) |
Plus: Income tax effect on
acquisition-related adjustment (earn-outs) |
|
|
— |
|
|
|
3.8 |
|
Plus: Nonoperational foreign
currency loss on internal loan transaction |
|
|
4.2 |
|
|
|
— |
|
Less: Income tax effect on
nonoperational foreign currency loss on internal loan
transaction |
|
|
(1.0 |
) |
|
|
— |
|
Plus: Impairment of cost-based
investments |
|
|
1.0 |
|
|
|
— |
|
Less: Income tax effect on
impairment of cost-based investments |
|
|
(0.3 |
) |
|
|
— |
|
Less: Litigation reserve, net
of recovery |
|
|
(4.7 |
) |
|
|
— |
|
Plus: Income tax effect on
litigation reserve, net of recovery |
|
|
1.7 |
|
|
|
— |
|
Adjusted net income |
|
$ |
234.0 |
|
|
$ |
196.4 |
|
|
|
|
|
|
|
|
|
|
Diluted EPS attributable to
Verisk |
|
$ |
1.52 |
|
|
$ |
1.27 |
|
Diluted adjusted EPS |
|
$ |
1.63 |
|
|
$ |
1.29 |
|
|
|
|
|
|
|
|
|
|
Weighted-average diluted
shares outstanding |
|
|
144.0 |
|
|
|
152.7 |
|
Free Cash Flow Reconciliation(in millions)Note:
Free cash flow is a non-GAAP measure.
|
|
Three Months Ended |
|
|
|
|
|
|
|
March 31, |
|
|
|
|
|
|
|
2024 |
|
|
2023 |
|
|
Change |
|
Net cash provided by operating
activities |
|
$ |
372.2 |
|
|
$ |
365.3 |
|
|
|
1.9 |
% |
Capital expenditures |
|
|
(55.2 |
) |
|
|
(61.2 |
) |
|
|
(9.8 |
)% |
Free cash flow |
|
$ |
317.0 |
|
|
$ |
304.1 |
|
|
|
4.2 |
% |
Investor Relations
Stacey Brodbar
Head of Investor Relations
Verisk
201-469-4327
IR@verisk.com
Media
Alberto Canal
Verisk Public Relations
201-469-2618
Alberto.Canal@verisk.com
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