Moody’s(MCO)2024-10-23 20:28Revenue Growth - Revenue for the three months ended September 30, 2024, was $1,813 million, a 23.2% increase from $1,472 million in the same period of 2023[17] - Total external revenue for the three months ended September 30, 2024, was $982 million, a 41% increase from $696 million in the same period of 2023[46] - Total revenue for Moody's Corporation in Q3 2024 reached $1,813 million, a 39% increase compared to $1,472 million in Q3 2023[50] - Total revenue for the nine months ended September 30, 2024, reached $3,128 million, a 35% increase compared to $2,314 million in the same period of 2023[193] - Moody's total revenue for the nine months ended September 30, 2024, was $5,416 million, representing a 22% increase from $4,436 million in 2023[58] Income and Earnings - Net income attributable to Moody's for the three months ended September 30, 2024, was $534 million, compared to $389 million in the same period of 2023, representing a 37.4% increase[17] - Basic earnings per share for the three months ended September 30, 2024, was $2.94, an increase from $2.12 in the same period of 2023[17] - Net income for the nine months ended September 30, 2024, was $1,664 million, an increase from $1,268 million in the same period of 2023, representing a growth of approximately 31%[25] - The diluted EPS attributable to Moody's common shareholders increased by 39% to $2.93, while adjusted diluted EPS rose by 32% to $3.21[138] Operating Performance - Operating income for the three months ended September 30, 2024, was $738 million, up 37.9% from $535 million in the same period of 2023[17] - Adjusted Operating Income for 2024 was $867 million, compared to $657 million in 2023, reflecting a 32% growth[121] - Operating margin improved to 40.7%, up 440 basis points from 36.3% in the prior year, reflecting strong revenue growth[137] - Adjusted operating margin improved to 62.5%, up from 55.3% in the previous year[193] Expenses and Costs - Total expenses for the three months ended September 30, 2024, were $1,075 million, compared to $937 million in the same period of 2023, reflecting a 14.7% increase[17] - Total operating and SG&A expenses rose to $946 million, a 16% increase from $815 million, primarily due to higher compensation costs[137] - Total operating and SG&A expenses for MA increased by 9% to $1,721 million, with compensation expenses rising by $102 million[189] Assets and Liabilities - Total current assets increased to $5,393 million as of September 30, 2024, compared to $4,341 million at December 31, 2023, reflecting a growth of about 24%[23] - Total liabilities increased to $11,701 million as of September 30, 2024, compared to $11,146 million at December 31, 2023, marking an increase of about 5%[23] - Total shareholders' equity increased to $4,068 million as of September 30, 2024, up from $3,476 million at December 31, 2023, representing a growth of about 17%[23] Cash Flow and Investments - The company reported net cash provided by operating activities of $2,164 million for the nine months ended September 30, 2024, compared to $1,674 million for the same period in 2023, a growth of approximately 29%[25] - Cash and cash equivalents at the end of the period were $2,642 million, up from $2,006 million at the end of the previous year, indicating a rise of approximately 32%[25] - The company has invested in COLI with a contract value of $49 million as of September 30, 2024, up from $47 million as of December 31, 2023[65] Segment Performance - Decision Solutions (DS) revenue reached $383 million, up from $354 million year-over-year, with a notable increase in KYC revenue from $80 million to $95 million[45] - Corporate Finance (CFG) revenue surged to $515 million, compared to $346 million in the prior year, driven by a significant rise in investment-grade revenue from $63 million to $149 million[45] - Moody's Analytics (MA) external revenue increased by 7% to $831 million, driven by sustained demand for KYC and insurance offerings[137] Tax and Compliance - The effective tax rate (ETR) for the nine months ended September 30, 2024, was 23.5%, an increase from 14.6% in the same period of 2023, primarily due to prior year tax benefits not recurring[62] - The company is subject to ongoing tax audits and legal proceedings, which may impact its financial position and operations[117] Strategic Initiatives - The company acquired a controlling financial interest in GCR in July 2024, expanding its market presence in Africa[10] - Moody's acquired a controlling financial interest in Praedicat in September 2024, enhancing its analytics capabilities in casualty insurance[12] - The restructuring program is expected to generate annualized savings of $145 million to $165 million, with cumulative expenses incurred amounting to $213 million[87]