NEW YORK, April 29, 2021 /PRNewswire/ -- S&P Global (NYSE: SPGI) today reported first quarter 2021
results with revenue of $2,016 million, an increase of 13% compared to the same period last year. Net
income increased 18% to $755 million and diluted earnings per share increased 19% to $3.12 primarily due to
revenue growth in every segment and productivity programs and lower T&E across the Company.
Adjusted net income increased 23% to $820 million and adjusted diluted earnings per share increased 24% to
$3.39. The largest adjustments in the first quarter of 2021 were for costs related to the pending merger
with IHS Markit and deal-related amortization related to previous acquisitions.
"Since the beginning of the pandemic, the essential nature of our products has demonstrated the resiliency of
our business model. As the global economy recovers, we continue to launch innovative new products to
help our customers with the ratings, benchmarks, data, and insights they need to navigate the changing
markets," said Douglas L. Peterson, President and Chief Executive Officer of S&P Global. "As to
the pending merger with IHS Markit, the shareholders of both companies overwhelmingly approved the
transaction and we continue to work with global regulators in anticipation of closing the merger in the
second half of 2021."
Profit Margin: The Company's operating profit margin increased 260 basis points to 53.6% primarily
due to strong operating results partially offset by costs related to the pending merger with IHS
Markit. Adjusted operating profit margin increased 450 basis points to 57.6% primarily due to strong
operating results.
Return of Capital: During the first quarter, the Company returned $186 million to shareholders
in dividends. There were no share repurchases during the quarter due to the pending merger with IHS
Markit.
Ratings: Revenue increased 23% to $1,017 million in the first quarter of 2021.
Transaction revenue increased 35% to $582 million primarily due to substantial levels of high-yield bond
issuance, bank loan rating activity and structured finance. Non-transaction revenue increased
10% to $435 million due to strength in CRISIL, surveillance, new-entity ratings, and Ratings Evaluation
Services.
Operating profit increased 31% to $681 million and operating profit margin improved 390 basis points to 67.0%
compared to the first quarter of 2020 due to exceptional revenue growth partially offset by increased
expenses. Adjusted operating profit increased 32% to $686 million and adjusted operating profit margin
improved 440 basis points to 67.5%.
S&P Dow Jones Indices: S&P Dow Jones Indices LLC is a majority-owned
subsidiary. The consolidated results are included in S&P Global's income statement and the portion
related to the 27% noncontrolling interest is removed in net income attributable to noncontrolling
interests.
Revenue increased 4% to $270 million in the first quarter of 2021 as gains in asset-linked fees were
substantially offset by reduced exchange-traded derivative fees.
Asset-linked fees include fees associated with ETFs, mutual funds, and certain over-the-counter
derivatives. Revenue from ETFs is the largest component of asset-linked fees, and average ETF AUM
associated with the Company's indices increased 30% year-over-year. Quarter-ending ETF AUM associated
with our indices was $2.2 trillion, a 65% increase from the end of the first quarter of 2020.
Operating profit increased 5% to $191 million and operating profit margin improved 80 basis points to 70.8%
due to revenue growth partially offset by increased expenses. Adjusted operating profit increased 5% to $192
million and adjusted operating profit margin improved 70 basis points to 71.3%. Operating profit
attributable to the Company increased 5% to $140 million. Adjusted operating profit attributable to
the Company increased 5% to $141 million.
Market Intelligence: Revenue increased 4% to $539 million in the first quarter of 2021
with growth in Credit Risk Solutions, Data Management Solutions, and Desktop. Operating profit
increased 13% to $166 million and operating profit margin improved 260 basis points to 30.9% due to revenue
growth and expenses that were essentially unchanged. Adjusted operating profit increased 13% to $181
million and adjusted operating profit margin improved 260 basis points to 33.5%.
Platts: Revenue increased 5% to $225 million in the first quarter of 2021 with growth in the
core subscription business partially offset by lower Global Trading Services revenue. Operating profit
increased 15% to $129 million and operating profit margin improved 530 basis points to 57.2% due to
increased revenue and a decline in expenses. Adjusted operating profit increased 15% to $131 million
and adjusted operating profit margin improved 520 basis points to 58.1%.
Corporate Unallocated Expense: This expense increased from $49 million in the prior period to
$86 million in the first quarter of 2021 due to $49 million of expenses related to the pending IHS Markit
merger partially offset by a $7 million restructuring charge in the prior period. Adjusted Corporate
Unallocated expense declined from $30 million in the prior period to $28 million primarily due to
pandemic-related management actions.
Provision for Income Taxes: The Company's effective tax rate increased to 23.4% in the first
quarter of 2021 compared to 21.5% in the same period last year, and the Company's adjusted effective tax
rate increased to 23.2% in the first quarter of 2021 compared to 21.7% in the same period last year. The
increase in the effective tax rates was primarily due to a decrease in the tax benefit associated with
stock-based compensation and an increase in taxes on foreign operations. The Company's effective tax
rate may fluctuate from quarter to quarter due to the timing of discrete tax adjustments.
Balance Sheet and Cash Flow: Cash, cash equivalents, and restricted cash at the end of the
first quarter were $4.5 billion. In the first three months of 2021, cash provided by operating activities
was $768 million, cash used for investing activities was $24 million, and cash used for financing activities
was $293 million. Free cash flow in the first three months of 2021 was $681 million, an increase of
$63 million from the same period in 2020, primarily due to increased net income. Free cash flow
excluding costs associated with the pending merger with IHS Markit was $718 million, an increase of $100
million over the same period in 2020.
Outlook: The Company is not providing 2021 GAAP guidance because given the inherent uncertainty
around the merger, management cannot reliably predict all of the necessary components of GAAP
measures. The Company is providing adjusted guidance on a stand-alone basis that excludes anticipated
merger expenses, the potential revenue and expense impact from consolidating IHS Markit following the
merger, and amortization of intangibles related to acquisitions. 2021 reported revenue is expected to
increase mid single-digits. Adjusted diluted EPS guidance has been increased by $0.30 to a new range
of $12.55 to $12.75. Guidance for free cash flow excluding certain items has also been increased to a
new range of $3.4 billion to $3.5 billion.
Comparison of Adjusted Information to U.S. GAAP Information: The Company reports its financial
results in accordance with accounting principles generally accepted in the United States ("GAAP"). The
Company also refers to and presents certain additional non-GAAP financial measures, within the meaning of
Regulation G under the Securities Exchange Act of 1934. These measures are: adjusted diluted earnings per
share, adjusted net income, adjusted operating profit and margin, organic revenue, adjusted Corporate
Unallocated expense, adjusted effective tax rates, adjusted diluted EPS guidance, free cash flow, and free
cash flow excluding certain items. The Company has included reconciliations of these non-GAAP financial
measures to the most directly comparable financial measures calculated in accordance with GAAP on Exhibits 5
and 7. Reconciliations of certain forward-looking non-GAAP financial measures to comparable GAAP measures
are not available due to the challenges and impracticability with estimating some of the items. The Company
is not able to provide reconciliations of such forward-looking non-GAAP financial measures because certain
items required for such reconciliations are outside of the Company's control and/or cannot be reasonably
predicted. Because of those challenges, reconciliations of such forward-looking non-GAAP financial measures
are not available without unreasonable effort.
The Company's non-GAAP measures include adjustments that reflect how management views our businesses. The
Company believes these non-GAAP financial measures provide useful supplemental information that, in the case
of non-GAAP financial measures other than free cash flow and free cash flow excluding certain items, enables
investors to better compare the Company's performance across periods, and management also uses these
measures internally to assess the operating performance of its business, to assess performance for employee
compensation purposes and to decide how to allocate resources. The Company believes that the presentation of
free cash flow and free cash flow excluding certain items allows investors to evaluate the cash generated
from our underlying operations in a manner similar to the method used by management and that such measures
are useful in evaluating the cash available to us to prepay debt, make strategic acquisitions and
investments, and repurchase stock. However, investors should not consider any of these non-GAAP measures in
isolation from, or as a substitute for, the financial information that the Company reports.
Conference Call/Webcast Details: The Company's senior management will review the first quarter
2021 earnings results on a conference call scheduled for today, April 29, at 8:30 a.m. EDT. Additional
information presented on the conference call may be made available on the Company's Investor Relations
Website at http://investor.spglobal.com.
The Webcast will be available live and in replay at http://investor.spglobal.com/Quarterly-Earnings. (Please copy and paste URL
into Web browser.)
Telephone access is available. U.S. participants may call (888) 603-9623; international participants may call
+1 (630) 395-0220 (long-distance charges will apply). The passcode is "S&P Global" and the conference
leader is Douglas Peterson. A recorded telephone replay will be available approximately two hours after the
meeting concludes and will remain available until May 28, 2021. U.S. participants may call (800) 947-2123;
international participants may call +1 (203) 369-3956 (long-distance charges will apply). No passcode is
required.
Forward-Looking Statements: This press release contains "forward-looking statements," as
defined in the Private Securities Litigation Reform Act of 1995. These statements, including
statements about COVID-19 and the merger (the "Merger") between a subsidiary of the Company and IHS Markit
Ltd. ("IHS Markit"), which express management's current views concerning future events, trends,
contingencies or results, appear at various places in this report and use words like "anticipate," "assume,"
"believe," "continue," "estimate," "expect," "forecast," "future," "intend," "plan," "potential," "predict,"
"project," "strategy," "target" and similar terms, and future or conditional tense verbs like "could,"
"may," "might," "should," "will," and "would." For example, management may use forward-looking statements
when addressing topics such as: the outcome of contingencies; future actions by regulators; changes in the
Company's business strategies and methods of generating revenue; the development and performance of the
Company's services and products; the expected impact of acquisitions and dispositions; the Company's
effective tax rates; and the Company's cost structure, dividend policy, cash flows or liquidity.
Forward-looking statements are subject to inherent risks and uncertainties. Factors that could cause actual
results to differ materially from those expressed or implied in forward-looking statements include, among
other things:
- worldwide economic, financial, political and regulatory conditions, and factors that contribute to
uncertainty and volatility, natural and man-made disasters, civil unrest, pandemics (e.g., COVID-19),
geopolitical uncertainty, and conditions that may result from legislative, regulatory, trade and policy
changes;
- the satisfaction of the conditions precedent to consummation of the Merger, including the ability to
secure regulatory approvals on the terms expected at all or in a timely manner;
- the occurrence of events that may give rise to a right of one or both of the parties to terminate the
merger agreement;
- uncertainty relating to the impact of the Merger on the businesses of the Company and IHS Markit,
including potential adverse reactions or changes to the market price of the Company's common stock and
IHS Markit shares resulting from the announcement or completion of the Merger and changes to existing
business relationships during the pendency of the acquisition that could affect the Company's and/or IHS
Markit's financial performance;
- risks relating to the value of the Company's stock to be issued in the Merger, significant transaction
costs and/or unknown liabilities;
- the ability of the Company to successfully integrate IHS Markit's operations and retain and hire key
personnel of both companies;
- the ability of the Company to retain customers and to implement its plans, forecasts and other
expectations with respect to IHS Markit's business after the consummation of the Merger and realize
expected synergies;
- business disruption following the Merger;
- the possibility that the Merger may be more expensive to complete than anticipated, including as a
result of unexpected factors or events;
- the Company's and IHS Markit's ability to meet expectations regarding the accounting and tax treatments
of the Merger;
- the Company's ability to successfully recover should it experience a disaster or other business
continuity problem from a hurricane, flood, earthquake, terrorist attack, pandemic, security breach,
cyber attack, power loss, telecommunications failure or other natural or man-made event, including the
ability to function remotely during long-term disruptions such as the ongoing COVID-19 pandemic;
- the Company's ability to maintain adequate physical, technical and administrative safeguards to protect
the security of confidential information and data, and the potential for a system or network disruption
that results in regulatory penalties and remedial costs or improper disclosure of confidential
information or data;
- the outcome of litigation, government and regulatory proceedings, investigations and inquiries;
- the health of debt and equity markets, including credit quality and spreads, the level of liquidity and
future debt issuances, demand for investment products that track indices and assessments and trading
volumes of certain exchange-traded derivatives;
- the demand and market for credit ratings in and across the sectors and geographies where the Company
operates;
- concerns in the marketplace affecting the Company's credibility or otherwise affecting market
perceptions of the integrity or utility of independent credit ratings, benchmarks and indices;
- the effect of competitive products and pricing, including the level of success of new product
developments and global expansion;
- the Company's exposure to potential criminal sanctions or civil penalties for noncompliance with foreign
and U.S. laws and regulations that are applicable in the domestic and international jurisdictions in
which it operates, including sanctions laws relating to countries such as Iran, Russia, Sudan, Syria and
Venezuela, anti-corruption laws such as the U.S. Foreign Corrupt Practices Act and the U.K. Bribery Act
of 2010, and local laws prohibiting corrupt payments to government officials, as well as import and
export restrictions;
- the continuously evolving regulatory environment, in Europe, the United States and elsewhere, affecting
S&P Global Ratings, S&P Global Platts, S&P Dow Jones Indices, S&P Global Market
Intelligence and the products those business divisions offer including our ESG products, and the
Company's compliance therewith;
- the Company's ability to make acquisitions and dispositions and successfully integrate the businesses we
acquire;
- consolidation in the Company's end-customer markets;
- the introduction of competing products or technologies by other companies;
- the impact of customer cost-cutting pressures, including in the financial services industry and the
commodities markets;
- a decline in the demand for credit risk management tools by financial institutions;
- the level of merger and acquisition activity in the United States and abroad;
- the volatility and health of the energy and commodities markets;
- our ability to attract, incentivize and retain key employees;
- the level of the Company's future cash flows and capital investments;
- the impact on the Company's revenue and net income caused by fluctuations in foreign currency exchange
rates;
- the Company's ability to adjust to changes in European and United Kingdom markets as the United Kingdom
leaves the European Union, and the impact of the United Kingdom's departure on our credit rating
activities and other offerings in the European Union and United Kingdom; and
- the impact of changes in applicable tax or accounting requirements on the Company.
The factors noted above are not exhaustive. The Company and its subsidiaries operate in a dynamic business
environment in which new risks emerge frequently. Accordingly, the Company cautions readers not to place
undue reliance on any forward-looking statements, which speak only as of the dates on which they are made.
The Company undertakes no obligation to update or revise any forward-looking statement to reflect events or
circumstances arising after the date on which it is made, except as required by applicable law. Further
information about the Company's businesses, including information about factors that could materially affect
its results of operations and financial condition, is contained in the Company's filings with the SEC,
including Item 1A, Risk Factors, in our most recently filed Annual Report on Form 10-K.
No Offer or Solicitation
This communication is not intended to and shall not constitute an offer to sell or the solicitation of an
offer to sell or the solicitation of an offer to buy any securities or a solicitation of any vote of
approval, nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or
sale would be unlawful prior to registration or qualification under the securities laws of any such
jurisdiction. No offering of securities shall be made except by means of a prospectus meeting the
requirements of Section 10 of the Securities Act of 1933, as amended.
Important Information About the Transaction and Where to Find It
In connection with the proposed
transaction, S&P Global and IHS Markit have filed and will file relevant materials with the SEC. On
January 8, 2021, S&P Global filed with the SEC a registration statement on Form S-4, as amended (No.
333-251999), to register the shares of S&P Global common stock to be issued in connection with the
proposed transaction. The registration statement, which was declared effective by the SEC on January 22,
2021, includes a definitive joint proxy statement/prospectus of S&P Global and IHS Markit. The
definitive joint proxy statement/prospectus was mailed to the shareholders of S&P Global and IHS Markit
seeking their approval of their respective transaction-related proposals. INVESTORS AND SECURITY HOLDERS ARE
URGED TO READ THE REGISTRATION STATEMENT ON FORM S-4 AND THE RELATED JOINT PROXY STATEMENT/PROSPECTUS, AS
WELL AS ANY AMENDMENTS OR SUPPLEMENTS TO THOSE DOCUMENTS AND ANY OTHER RELEVANT DOCUMENTS THAT ARE FILED OR
TO BE FILED WITH THE SEC IN CONNECTION WITH THE PROPOSED TRANSACTION, CAREFULLY AND IN THEIR ENTIRETY
BECAUSE THEY CONTAIN OR WILL CONTAIN IMPORTANT INFORMATION ABOUT S&P GLOBAL, IHS MARKIT AND THE PROPOSED
TRANSACTION.
Investors and security holders may obtain copies of these documents free of charge through the website
maintained by the SEC at www.sec.gov or from S&P Global at its website, or from IHS Markit at its
website. Documents filed with the SEC by S&P Global will be available free of charge by accessing
S&P Global's website at www.spglobal.com under the heading Investor Relations, or, alternatively, by
directing a request by telephone to 866-436-8502 (domestic callers) or 212-438-2192 (international callers)
or by mail to S&P Global at Investor Relations, S&P Global Inc., 55 Water Street, New York, NY
10041, and documents filed with the SEC by IHS Markit will be available free of charge by accessing IHS
Markit's website at www.ihsmarkit.com under the heading Investor Relations or, alternatively, by
directing a request by telephone to 303-790-0600 or by mail to IHS Markit at IHS Markit Investor Relations
and Corporate Communications, 15 Inverness Way East, Englewood, CO 80112.
About S&P Global
S&P Global is the world's foremost provider of credit ratings, benchmarks
and analytics in the global capital and commodity markets, offering ESG solutions, deep data, and insights
on critical economic, market, and business factors. We've been providing essential intelligence that unlocks
opportunity, fosters growth, and accelerates progress for more than 160 years. Our divisions include S&P
Global Ratings, S&P Global Market Intelligence, S&P Dow Jones Indices, and S&P Global Platts.
For more information, visit www.spglobal.com.
Investor Relations: http://investor.spglobal.com
Get news direct via RSS:
https://investor.spglobal.com/contact-investor-relations/rss-feeds/default.aspx
Contact:
Investor Relations:
Chip Merritt
Senior Vice President, Investor Relations
(212) 438-4321
(office)
[email protected]
News Media:
David Guarino
Chief Communications Officer
(201) 755-5334 (cell)
[email protected]
Christopher Krantz
Lead, Executive Communications
+44 (0) 20 7176 0060 (office)
[email protected]
Exhibit 1
|
|
S&P Global
|
Condensed Consolidated Statements of Income
|
Three months ended March 31, 2021 and 2020 (dollars
in millions, except per share data)
|
|
|
|
(unaudited)
|
|
2021
|
|
2020
|
|
% Change
|
|
|
|
|
|
|
|
|
|
Revenue
|
|
$
|
2,016
|
|
|
$
|
1,786
|
|
|
13%
|
|
Expenses
|
|
937
|
|
|
881
|
|
|
6%
|
|
Gain on dispositions
|
|
(2)
|
|
|
(7)
|
|
|
(71)%
|
|
Operating profit
|
|
1,081
|
|
|
912
|
|
|
19%
|
|
Other (income) expense, net
|
|
(7)
|
|
|
1
|
|
|
N/M
|
|
Interest expense, net
|
|
32
|
|
|
34
|
|
|
(7)%
|
|
Income before taxes on income
|
|
1,056
|
|
|
877
|
|
|
20%
|
|
Provision for taxes on income
|
|
248
|
|
|
188
|
|
|
32%
|
|
Net income
|
|
808
|
|
|
689
|
|
|
17%
|
|
Less: net income attributable to noncontrolling
interests
|
|
(53)
|
|
|
(50)
|
|
|
(7)%
|
|
Net income attributable to S&P Global Inc.
|
|
$
|
755
|
|
|
$
|
639
|
|
|
18%
|
|
|
|
|
|
|
|
|
|
Earnings per share attributable to S&P Global Inc. common
shareholders:
|
|
|
|
|
|
|
|
Net income:
|
|
|
|
|
|
|
|
Basic
|
|
$
|
3.14
|
|
|
$
|
2.64
|
|
|
19%
|
|
Diluted
|
|
$
|
3.12
|
|
|
$
|
2.62
|
|
|
19%
|
|
|
|
|
|
|
|
|
|
Weighted-average number of common
shares outstanding:
|
|
|
|
|
|
|
|
Basic
|
|
240.6
|
|
|
242.1
|
|
|
|
|
Diluted
|
|
241.6
|
|
|
243.3
|
|
|
|
|
|
|
|
|
|
|
|
|
Actual shares outstanding at period end
|
|
240.9
|
|
|
240.9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
N/M - not meaningful
|
Note - % change in the tables throughout the exhibits are
calculated off of the actual number, not the rounded number presented.
|
Exhibit 2
|
|
S&P Global
|
Condensed Consolidated Balance Sheets
|
March 31, 2021 and December 31, 2020
|
(dollars in millions)
|
|
(unaudited)
|
|
March 31,
|
|
|
December 31,
|
|
|
|
2021
|
|
|
2020
|
|
|
|
|
|
|
|
|
Assets:
|
|
|
|
|
|
|
Cash, cash equivalents, and restricted cash
|
|
$
|
4,518
|
|
|
|
$
|
4,122
|
|
|
Other current assets
|
|
1,788
|
|
|
|
1,866
|
|
|
Total current assets
|
|
6,306
|
|
|
|
5,988
|
|
|
Property and equipment, net
|
|
281
|
|
|
|
284
|
|
|
Right of use assets
|
|
479
|
|
|
|
494
|
|
|
Goodwill and other intangible assets, net
|
|
5,045
|
|
|
|
5,087
|
|
|
Other non-current assets
|
|
719
|
|
|
|
684
|
|
|
Total assets
|
|
$
|
12,830
|
|
|
|
$
|
12,537
|
|
|
|
|
|
|
|
|
|
Liabilities and Equity:
|
|
|
|
|
|
|
Unearned revenue
|
|
2,111
|
|
|
|
2,168
|
|
|
Other current liabilities
|
|
1,292
|
|
|
|
1,419
|
|
|
Long-term debt
|
|
4,111
|
|
|
|
4,110
|
|
|
Lease liabilities — non-current
|
|
525
|
|
|
|
544
|
|
|
Pension, other postretirement benefits and other non-current
liabilities
|
|
885
|
|
|
|
944
|
|
|
Total liabilities
|
|
8,924
|
|
|
|
9,185
|
|
|
Redeemable noncontrolling interest
|
|
2,808
|
|
|
|
2,781
|
|
|
Total equity
|
|
1,098
|
|
|
|
571
|
|
|
Total liabilities and equity
|
|
$
|
12,830
|
|
|
|
$
|
12,537
|
|
|
|
|
|
|
|
|
|
Exhibit 3
|
|
S&P Global
|
Condensed Consolidated Statements of Cash Flows
|
Three months ended March 31, 2021 and 2020
|
(dollars in millions)
|
|
(unaudited)
|
|
2021
|
|
|
2020
|
|
|
|
|
|
|
|
|
Operating Activities:
|
|
|
|
|
|
|
Net income
|
|
$
|
808
|
|
|
|
$
|
689
|
|
|
Adjustments to reconcile net income to cash provided by
operating activities:
|
|
|
|
|
|
|
Depreciation
|
|
19
|
|
|
|
20
|
|
|
Amortization of intangibles
|
|
31
|
|
|
|
29
|
|
|
Deferred income taxes
|
|
(3)
|
|
|
|
(6)
|
|
|
Stock-based compensation
|
|
19
|
|
|
|
11
|
|
|
Gain on dispositions
|
|
(2)
|
|
|
|
(7)
|
|
|
Other
|
|
29
|
|
|
|
39
|
|
|
Net changes in other operating assets and liabilities
|
|
(133)
|
|
|
|
(95)
|
|
|
Cash provided by operating activities
|
|
768
|
|
|
|
680
|
|
|
|
|
|
|
|
|
|
Investing Activities:
|
|
|
|
|
|
|
Capital expenditures
|
|
(18)
|
|
|
|
(11)
|
|
|
Acquisitions, net of cash acquired
|
|
(9)
|
|
|
|
(183)
|
|
|
Proceeds from disposition
|
|
2
|
|
|
|
—
|
|
|
Changes in short-term investments
|
|
1
|
|
|
|
11
|
|
|
Cash used for investing activities
|
|
(24)
|
|
|
|
(183)
|
|
|
|
|
|
|
|
|
|
Financing Activities:
|
|
|
|
|
|
|
Dividends paid to shareholders
|
|
(186)
|
|
|
|
(161)
|
|
|
Distributions to noncontrolling interest holders, net
|
|
(69)
|
|
|
|
(51)
|
|
|
Repurchase of treasury shares
|
|
—
|
|
|
|
(1,153)
|
|
|
Exercise of stock options and employee withholding tax on
share-based payments
|
|
(38)
|
|
|
|
(36)
|
|
|
Cash used for financing activities
|
|
(293)
|
|
|
|
(1,401)
|
|
|
Effect of exchange rate changes on cash
|
|
(55)
|
|
|
|
(30)
|
|
|
Net change in cash, cash equivalents, and restricted
cash
|
|
396
|
|
|
|
(934)
|
|
|
Cash, cash equivalents, and restricted cash at beginning of
period
|
|
4,122
|
|
|
|
2,886
|
|
|
Cash, cash equivalents, and restricted cash at end of
period
|
|
$
|
4,518
|
|
|
|
$
|
1,952
|
|
|
|
|
|
|
|
|
|
Exhibit 4
|
|
S&P Global
|
Operating Results by Segment
|
Three months ended March 31, 2021 and 2020
|
(dollars in millions)
|
|
(unaudited)
|
|
Revenue
|
|
|
|
|
|
|
|
|
|
|
|
2021
|
|
2020
|
|
% Change
|
|
|
|
|
|
|
|
|
|
Ratings
|
|
$
|
1,017
|
|
|
$
|
825
|
|
|
23%
|
|
Market Intelligence
|
|
539
|
|
|
519
|
|
|
4%
|
|
Platts
|
|
225
|
|
|
215
|
|
|
5%
|
|
Indices
|
|
270
|
|
|
259
|
|
|
4%
|
|
Intersegment Elimination
|
|
(35)
|
|
|
(32)
|
|
|
(9)%
|
|
Total revenue
|
|
$
|
2,016
|
|
|
$
|
1,786
|
|
|
13%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Expenses
|
|
|
|
|
|
|
|
|
|
|
|
2021
|
|
2020
|
|
% Change
|
|
|
|
|
|
|
|
|
|
Ratings (a)
|
|
$
|
336
|
|
|
$
|
305
|
|
|
10%
|
|
Market Intelligence (b)
|
|
373
|
|
|
372
|
|
|
—%
|
|
Platts (c)
|
|
96
|
|
|
103
|
|
|
(7)%
|
|
Indices (d)
|
|
79
|
|
|
77
|
|
|
2%
|
|
Corporate Unallocated expense (e)
|
|
86
|
|
|
49
|
|
|
77%
|
|
Intersegment Elimination
|
|
(35)
|
|
|
(32)
|
|
|
(9)%
|
|
Total expenses
|
|
$
|
935
|
|
|
$
|
874
|
|
|
7%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating Profit
|
|
|
|
|
|
|
|
|
|
|
|
2021
|
|
2020
|
|
% Change
|
|
|
|
|
|
|
|
|
|
Ratings (a)
|
|
$
|
681
|
|
|
$
|
520
|
|
|
31%
|
|
Market Intelligence (b)
|
|
166
|
|
|
147
|
|
|
13%
|
|
Platts (c)
|
|
129
|
|
|
112
|
|
|
15%
|
|
Indices (d)
|
|
191
|
|
|
182
|
|
|
5%
|
|
Total reportable segments
|
|
1,167
|
|
|
961
|
|
|
22%
|
|
Corporate Unallocated expense (e)
|
|
(86)
|
|
|
(49)
|
|
|
(77)%
|
|
Total operating profit
|
|
$
|
1,081
|
|
|
$
|
912
|
|
|
19%
|
|
|
|
|
|
|
|
|
|
|
|
(a)
|
2021 includes amortization of intangibles from acquisitions of
$5 million.
|
(b)
|
2021 includes a gain on disposition of $2 million. 2020
includes a gain on the sale of Investor Relations of $7 million and employee
severance charges of $2 million. 2021 and 2020 includes amortization of intangibles
from acquisitions of $16 million and $19 million, respectively.
|
(c)
|
2021 and 2020 both include amortization of intangibles from
acquisitions of $2 million.
|
(d)
|
2021 and 2020 both include amortization of intangibles from
acquisitions of $1 million.
|
(e)
|
2021 includes $49 million of IHS Markit merger costs and
Kensho retention related expense of $2 million. 2020 includes employee severance
charges of $7 million and Kensho retention related expense of $5 million. 2021 and
2020 both include amortization of intangibles from acquisitions of $7
million.
|
Exhibit 5
|
|
S&P Global
|
Operating Results - Reported vs. Adjusted
|
Non-GAAP Financial Information
|
Three months ended March 31, 2021 and 2020
|
(dollars in millions, except per share amounts)
|
Adjusted Expenses
|
|
(unaudited)
|
|
|
2021
|
|
2020
|
|
% Change
|
|
|
|
|
|
|
|
|
|
|
Ratings
|
Expenses
|
|
$
|
336
|
|
|
$
|
305
|
|
|
10%
|
|
Deal-related amortization
|
|
(5)
|
|
|
—
|
|
|
|
|
Adjusted expenses
|
|
$
|
331
|
|
|
$
|
304
|
|
|
9%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Market Intelligence
|
Expenses
|
|
$
|
373
|
|
|
$
|
372
|
|
|
—%
|
|
Non-GAAP Adjustments (a)
|
|
2
|
|
|
5
|
|
|
|
|
Deal-related amortization
|
|
(16)
|
|
|
(19)
|
|
|
|
|
Adjusted expenses
|
|
$
|
358
|
|
|
$
|
358
|
|
|
—%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Platts
|
Expenses
|
|
$
|
96
|
|
|
$
|
103
|
|
|
(7)%
|
|
Deal-related amortization
|
|
(2)
|
|
|
(2)
|
|
|
|
|
Adjusted expenses
|
|
$
|
94
|
|
|
$
|
101
|
|
|
(7)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Indices
|
Expenses
|
|
$
|
79
|
|
|
$
|
77
|
|
|
2%
|
|
Deal-related amortization
|
|
(1)
|
|
|
(1)
|
|
|
|
|
Adjusted expenses
|
|
$
|
77
|
|
|
$
|
76
|
|
|
2%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total segments
|
Expenses
|
|
$
|
849
|
|
|
$
|
826
|
|
|
3%
|
|
Non-GAAP Adjustments (a)
|
|
2
|
|
|
5
|
|
|
|
|
Deal-related amortization
|
|
(24)
|
|
|
(23)
|
|
|
|
|
Adjusted expenses
|
|
$
|
826
|
|
|
$
|
808
|
|
|
2%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Corporate Unallocated expense
|
Corporate Unallocated expense
|
|
$
|
86
|
|
|
$
|
49
|
|
|
77%
|
|
Non-GAAP adjustments (b)
|
|
(52)
|
|
|
(12)
|
|
|
|
|
Deal-related amortization
|
|
(7)
|
|
|
(7)
|
|
|
|
|
Adjusted expenses
|
|
$
|
28
|
|
|
$
|
30
|
|
|
(6)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total SPGI
|
Expenses
|
|
$
|
935
|
|
|
$
|
874
|
|
|
7%
|
|
Non-GAAP adjustments (a) (b)
|
|
(50)
|
|
|
(7)
|
|
|
|
|
Deal-related amortization
|
|
(31)
|
|
|
(29)
|
|
|
|
|
Adjusted expenses
|
|
$
|
855
|
|
|
$
|
839
|
|
|
2%
|
|
|
|
|
|
|
|
|
|
|
Adjusted Operating Profit
|
|
(unaudited)
|
|
|
2021
|
|
2020
|
|
% Change
|
|
|
|
|
|
|
|
|
|
|
Ratings
|
Operating profit
|
|
$
|
681
|
|
|
$
|
520
|
|
|
31%
|
|
Deal-related amortization
|
|
5
|
|
|
—
|
|
|
|
|
Adjusted operating profit
|
|
$
|
686
|
|
|
$
|
521
|
|
|
32%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Market Intelligence
|
Operating profit
|
|
$
|
166
|
|
|
$
|
147
|
|
|
13%
|
|
Non-GAAP Adjustments (a)
|
|
(2)
|
|
|
(5)
|
|
|
|
|
Deal-related amortization
|
|
16
|
|
|
19
|
|
|
|
|
Adjusted operating profit
|
|
$
|
181
|
|
|
$160
|
|
|
13%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Platts
|
Operating profit
|
|
$
|
129
|
|
|
$
|
112
|
|
|
15%
|
|
Deal-related amortization
|
|
2
|
|
|
2
|
|
|
|
|
Adjusted operating profit
|
|
$
|
131
|
|
|
$
|
114
|
|
|
15%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Indices
|
Operating profit
|
|
$
|
191
|
|
|
$
|
182
|
|
|
5%
|
|
Deal-related amortization
|
|
1
|
|
|
1
|
|
|
|
|
Adjusted operating profit
|
|
$
|
192
|
|
|
$
|
183
|
|
|
5%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total segments
|
Operating profit
|
|
$
|
1,167
|
|
|
$
|
961
|
|
|
22%
|
|
Non-GAAP Adjustments (a)
|
|
(2)
|
|
|
(5)
|
|
|
|
|
Deal-related amortization
|
|
24
|
|
|
23
|
|
|
|
|
Adjusted segment operating profit
|
|
$
|
1,190
|
|
|
$
|
978
|
|
|
22%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Corporate Unallocated expense
|
Corporate Unallocated expense
|
|
$
|
(86)
|
|
|
$
|
(49)
|
|
|
77%
|
|
Non-GAAP adjustments (b)
|
|
52
|
|
|
12
|
|
|
|
|
Deal-related amortization
|
|
7
|
|
|
7
|
|
|
|
|
Adjusted Corporate Unallocated expense
|
|
$
|
(28)
|
|
|
$
|
(30)
|
|
|
(7)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total SPGI
|
Operating profit
|
|
$
|
1,081
|
|
|
$
|
912
|
|
|
19%
|
|
Non-GAAP adjustments (a) (b)
|
|
50
|
|
|
7
|
|
|
|
|
Deal-related amortization
|
|
31
|
|
|
29
|
|
|
|
|
Adjusted operating profit
|
|
$
|
1,162
|
|
|
$
|
948
|
|
|
23%
|
|
|
|
|
|
|
|
|
|
|
Adjusted Provision for Income Taxes
|
|
(unaudited)
|
|
2021
|
|
2020
|
|
% Change
|
|
|
|
|
|
|
|
|
|
Provision for income taxes
|
|
$
|
248
|
|
|
$
|
188
|
|
|
32%
|
|
Non-GAAP adjustments (a) (b)
|
|
10
|
|
|
3
|
|
|
|
|
Deal-related amortization
|
|
7
|
|
|
7
|
|
|
|
|
Adjusted provision for income taxes
|
|
$
|
264
|
|
|
$
|
198
|
|
|
33%
|
|
|
|
|
|
|
|
|
|
Adjusted Effective Tax Rate
|
|
(unaudited)
|
|
2021
|
|
2020
|
|
% Change
|
|
|
|
|
|
|
|
|
|
Adjusted operating profit
|
|
$
|
1,162
|
|
|
$
|
948
|
|
|
23%
|
|
Other (income) expense, net
|
|
(7)
|
|
|
1
|
|
|
|
|
Interest expense, net
|
|
32
|
|
|
34
|
|
|
|
|
Adjusted income before taxes on income
|
|
$
|
1,137
|
|
|
$
|
913
|
|
|
25%
|
|
Adjusted provision for income taxes
|
|
$
|
264
|
|
|
$
|
198
|
|
|
|
|
Adjusted effective tax rate 1
|
|
23.2%
|
|
|
21.7%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1
The adjusted effective tax rate is calculated by dividing the adjusted
provision for income taxes by the adjusted income before taxes on income.
|
Adjusted Net Income attributable to SPGI and Adjusted Diluted EPS
|
|
(unaudited)
|
|
2021
|
|
|
2020
|
|
|
% Change
|
|
|
|
Net Income attributable to SPGI
|
|
Diluted EPS
|
|
|
Net Income attributable to SPGI
|
|
Diluted EPS
|
|
|
Net Income attributable
to SPGI
|
|
Diluted EPS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As reported
|
|
$
|
755
|
|
|
$
|
3.12
|
|
|
|
$
|
639
|
|
|
$
|
2.62
|
|
|
|
18%
|
|
19%
|
|
Non-GAAP adjustments (a)
(b)
|
|
40
|
|
|
0.17
|
|
|
|
4
|
|
|
0.01
|
|
|
|
|
|
|
|
Deal-related amortization
|
|
25
|
|
|
0.10
|
|
|
|
22
|
|
|
0.09
|
|
|
|
|
|
|
|
Adjusted
|
|
$
|
820
|
|
|
$
|
3.39
|
|
|
|
$
|
665
|
|
|
$
|
2.73
|
|
|
|
23%
|
|
24%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Note - Totals presented may not sum due to rounding.
|
Note - Adjusted operating profit margin for Ratings, Market
Intelligence, Platts and Indices was 67%, 34%, 58% and 71% for the three months
ended March 31, 2021. Adjusted operating profit margin for the Company was 58%
for the three months ended March 31, 2021. Adjusted operating profit margin is
calculated as adjusted operating profit divided by revenue.
|
|
|
(a)
|
2021 includes a gain on disposition of $2 million ($2 million
after-tax). 2020 includes a gain on the sale of Investor Relations of $7 million ($7
million after-tax) and employee severance charges of $2 million ($2 million
after-tax).
|
(b)
|
2021 includes $49 million ($41 million after-tax) of IHS
Markit merger costs and Kensho retention related expense of $2 million ($2 million
after-tax). 2020 includes employee severance charges of $7 million ($5 million
after-tax) and Kensho retention related expense of $5 million ($4 million
after-tax).
|
Exhibit 6
|
|
S&P Global
|
Revenue Information
|
Three months ended March 31, 2021 and 2020
|
(dollars in millions)
|
Revenue by Type
|
|
(unaudited)
|
Ratings
|
Market Intelligence
|
Platts
|
Indices
|
Intersegment Elimination
|
|
|
2021
|
|
2020
|
|
% Change
|
|
|
2021
|
|
2020
|
|
% Change
|
|
|
2021
|
|
2020
|
|
% Change
|
|
|
2021
|
|
2020
|
|
% Change
|
|
|
2021
|
|
2020
|
|
% Change
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-Subscription / Transaction (a)
|
|
$
|
582
|
|
$
|
430
|
|
35%
|
|
|
$
|
12
|
|
$
|
13
|
|
(11)%
|
|
|
$
|
1
|
|
$
|
1
|
|
(23)%
|
|
|
$
|
—
|
|
$
|
—
|
|
N/M
|
|
|
$
|
—
|
|
$
|
—
|
|
N/M
|
Non-Transaction (b)
|
|
435
|
|
395
|
|
10%
|
|
|
—
|
|
—
|
|
N/M
|
|
|
—
|
|
—
|
|
N/M
|
|
|
—
|
|
—
|
|
N/M
|
|
|
(35)
|
|
(32)
|
|
(9)%
|
Subscription (c)
|
|
—
|
|
—
|
|
N/M
|
|
|
527
|
|
505
|
|
4%
|
|
|
208
|
|
197
|
|
6%
|
|
|
46
|
|
46
|
|
1%
|
|
|
—
|
|
—
|
|
N/M
|
Asset-Linked Fees (d)
|
|
—
|
|
—
|
|
N/M
|
|
|
—
|
|
1
|
|
(84)%
|
|
|
—
|
|
—
|
|
N/M
|
|
|
183
|
|
159
|
|
15%
|
|
|
—
|
|
—
|
|
N/M
|
Sales Usage-Based Royalties (e)
|
|
—
|
|
—
|
|
N/M
|
|
|
—
|
|
—
|
|
N/M
|
|
|
16
|
|
17
|
|
(4)%
|
|
|
41
|
|
54
|
|
(24)%
|
|
|
—
|
|
—
|
|
N/M
|
Total revenue
|
|
$
|
1,017
|
|
$
|
825
|
|
23%
|
|
|
$
|
539
|
|
$
|
519
|
|
4%
|
|
|
$
|
225
|
|
$
|
215
|
|
5%
|
|
|
$
|
270
|
|
$
|
259
|
|
4%
|
|
|
$
|
(35)
|
|
$
|
(32)
|
|
(9)%
|
|
|
|
|
|
|
|
|
|
|
|
|
N/M - not meaningful
|
|
Note - In the first quarter of 2021, we reevaluated our
transaction and non-transaction presentation for Ratings which resulted in a
reclassification from transaction revenue to non-transaction revenue of $2 million
for the first quarter of 2020.
|
|
|
(a)
|
Non-subscription / transaction revenue is primarily related to
ratings of publicly-issued debt and bank loan ratings.
|
(b)
|
Non-transaction revenue is primarily related to surveillance
of a credit rating, annual fees for customer relationship-based pricing programs,
fees for entity credit ratings and global research and analytics at CRISIL.
Non-transaction revenue also includes an intersegment revenue elimination, which
mainly consists of the royalty of $33 million and $31 million for the three months
ended March 31, 2021 and 2020 respectively, charged to Market Intelligence for
the rights to use and distribute content and data developed by Ratings.
|
(c)
|
Subscription revenue is related to credit ratings-related
information products, Market Intelligence Desktop products, investment research
products and other data subscriptions, real-time news, market data and price
assessments, along with other information products.
|
(d)
|
Asset-linked fees is primarily related to fees based on assets
underlying exchange-traded funds, mutual funds and insurance products.
|
(e)
|
Sales usage-based royalty revenue is primarily related to
trading based fees from exchange-traded derivatives and licensing of its proprietary
market price data and price assessments to commodity exchanges.
|
Revenue by Geographic Area
|
|
(unaudited)
|
|
U.S.
|
|
|
International
|
|
|
|
2021
|
|
2020
|
|
% Change
|
|
|
2021
|
|
2020
|
|
% Change
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ratings
|
|
$
|
612
|
|
|
$
|
494
|
|
|
24%
|
|
|
$
|
405
|
|
|
$
|
331
|
|
|
22%
|
|
Market Intelligence
|
|
346
|
|
|
339
|
|
|
2%
|
|
|
193
|
|
|
180
|
|
|
7%
|
|
Platts
|
|
72
|
|
|
70
|
|
|
2%
|
|
|
153
|
|
|
145
|
|
|
6%
|
|
Indices
|
|
227
|
|
|
222
|
|
|
2%
|
|
|
43
|
|
|
37
|
|
|
17%
|
|
Intersegment elimination
|
|
(19)
|
|
|
(17)
|
|
|
6%
|
|
|
(16)
|
|
|
(15)
|
|
|
12%
|
|
Total revenue
|
|
$
|
1,238
|
|
|
$
|
1,108
|
|
|
12%
|
|
|
$
|
778
|
|
|
$
|
678
|
|
|
15%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Exhibit 7
|
|
S&P Global
|
Non-GAAP Financial Information
|
Three months ended March 31, 2021 and 2020
|
(dollars in millions)
|
Computation of Free Cash Flow and Free Cash Flow Excluding Certain Items
|
|
(unaudited)
|
|
Three Months
|
|
|
|
2021
|
|
2020
|
|
Cash provided by operating activities
|
|
$
|
768
|
|
|
$
|
680
|
|
|
Capital expenditures
|
|
(18)
|
|
|
(11)
|
|
|
Distributions to noncontrolling interest holders, net
|
|
(69)
|
|
|
(51)
|
|
|
Free cash flow
|
|
$
|
681
|
|
|
$
|
618
|
|
|
IHS Markit merger costs
|
|
37
|
|
|
—
|
|
|
Free cash flow excluding certain items
|
|
$
|
718
|
|
|
$
|
618
|
|
|
|
|
|
|
|
|
S&P Global Organic Revenue
|
(unaudited)
|
|
2021
|
|
2020
|
|
% Change
|
|
Total revenue
|
|
$
|
2,016
|
|
|
$
|
1,786
|
|
|
13%
|
|
Ratings acquisitions
|
|
(8)
|
|
|
(2)
|
|
|
|
|
Market Intelligence divestitures
|
|
—
|
|
|
(3)
|
|
|
|
|
Total adjusted revenue
|
|
$
|
2,008
|
|
|
$
|
1,781
|
|
|
13%
|
|
|
|
|
|
|
|
|
|
Organic revenue constant currency basis
|
|
$
|
1,989
|
|
|
$
|
1,781
|
|
|
12%
|
|
|
|
|
|
|
|
|
|
|
Ratings Organic Revenue
|
(unaudited)
|
|
2021
|
|
2020
|
|
% Change
|
|
Ratings revenue
|
|
$
|
1,017
|
|
|
$
|
825
|
|
|
23%
|
|
Acquisitions
|
|
(8)
|
|
|
(2)
|
|
|
|
|
Adjusted Ratings revenue
|
|
$
|
1,009
|
|
|
$
|
823
|
|
|
23%
|
|
|
|
|
|
|
|
|
|
|
Market Intelligence Organic Revenue
|
(unaudited)
|
|
2021
|
|
2020
|
|
% Change
|
|
Market Intelligence revenue
|
|
$
|
539
|
|
|
$
|
519
|
|
|
4%
|
|
Divestitures
|
|
—
|
|
|
(3)
|
|
|
|
|
Adjusted Market Intelligence revenue
|
|
$
|
539
|
|
|
$
|
516
|
|
|
4%
|
|
|
|
|
|
|
|
|
|
|
Platts Organic Revenue
|
(unaudited)
|
|
2021
|
|
2020
|
|
% Change
|
|
Platts revenue
|
|
$
|
225
|
|
|
$
|
215
|
|
|
5%
|
|
Acquisitions and divestitures
|
|
—
|
|
|
—
|
|
|
|
|
Adjusted Platts revenue
|
|
$
|
225
|
|
|
$
|
215
|
|
|
5%
|
|
|
|
|
|
|
|
|
|
|
Indices Organic Revenue
|
(unaudited)
|
|
2021
|
|
2020
|
|
% Change
|
|
Indices revenue
|
|
$
|
270
|
|
|
$
|
259
|
|
|
4%
|
|
Acquisitions and divestitures
|
|
—
|
|
|
—
|
|
|
|
|
Adjusted Indices revenue
|
|
$
|
270
|
|
|
$
|
259
|
|
|
4%
|
|
|
|
|
|
|
|
|
|
|
Adjusted Indices Net Operating Profit
|
(unaudited)
|
|
2021
|
|
2020
|
|
% Change
|
|
Adjusted operating profit
|
|
$
|
192
|
|
|
$
|
183
|
|
|
5%
|
|
Less: income attributable to NCI
|
|
51
|
|
|
49
|
|
|
|
|
Adjusted Indices Net Operating Profit
|
|
$
|
141
|
|
|
$
|
134
|
|
|
5%
|
|
|
|
|
|
|
|
|
|
View original content:http://www.prnewswire.com/news-releases/sp-global-revenue-increased-13-in-the-first-quarter-with-growth-across-all-four-divisions-301280090.html
SOURCE S&P Global